Deals and Financings
Merck (NYSE: MRK) announced plans to build an Asia Research & Development headquarters in Beijing, which will be devoted to innovative drug discovery and development (see story). The new initiative is part of a broader $1.5 billion investment in China R&D that Merck will make over the next five years. Merck said the investment has two goals: building its own capabilities and fostering relationships with outside researchers. It expects the center to provide new drugs and vaccines that meet global needs.
AstraZeneca (NYSE: AZN) announced it will increase its China presence by acquiring Guangdong BeiKang Pharmaceutical, a drug maker with five generic injectible anti-infective products (see story). The purchase price for BeiKang, a privately held company, was not disclosed. At the same time, AstraZeneca is laying off 1,150 members of its US-based sales force.
Lanzhou Foci Pharma [SHE: 002644] will issue 20.2 million shares in its IPO on the Shenzhen Small and Medium Enterprise Exchang.. The expected date is December 13th. The new shares will comprise 25% of the company’s post-IPO capitalization of 80.8 million shares. Founded in Shanghai in 1929, Foci Pharma mainly sells and distributes patented TCMs, although it also deals in western drugs and raw herbs.
Guangdong Taiantang Pharma [SHE: 002433] will pay 136 million RMB ($21.4 million) for a 52% stake in Guangzhou Hongxing Group, a company that has a portfolio of 94 patented TCM medicines. Taiantang, which makes skin and cardiovascular drugs, acquired the stake by buying Shanyan Investment.
Beijing SL Pharmaceutical [SHE: 002038] will invest 90 million RMB ($14 million) to buy new shares of Forwell Biopharm Co., giving Beijing SL an 18% stake in Forwell. Forwell’s major product is a human Adsorbed Rabies vaccine, which is administered before or after exposure to rabies. The transaction is the second investment Beijing SL has made in a vaccine company this year.
Zhejiang Conba Pharma [SHA: 600572] bought an 84% stake in Yunnan Xiongye Pharma, a company that makes both TCMs and western drugs. Last year, Xiongye lost 4.7 million RMB ($739,000) on 7.8 million RMB ($1.2 million) of revenue. Founded in 1969, Xiongye has a portfolio of over 40 products, the ostensible reason for Conba's interest. Terms of the transaction were not disclosed.
Mindray Medical (NYSE: MR) agreed to buy a controlling interest in Zhejiang Greenlander Information Technology, a Hangzhou company that specializes in healthcare IT (see story). Greenlander has developed software that archives medical images and combined it with a database tailored for the needs of radiology departments. Mindray makes numerous medical imaging devices. Terms of the transaction were not disclosed.
Aoxing Pharma (AMEX: AXN) announced a new 20 million RMB ($3.2 million) bank loan, arranged with the help of a city-government owned investment firm. The one-year loan features a high 15% interest rate. Last month, Aoxing received $315,000 from Heibei Province to pay interest on its existing $12 million of debt. Aoxing reported cash of $2.5 million at the end of its most recent reporting period, and a negative cash flow of $2 million over the previous 12 months.
Deals and Financings