Deals and Financings
BeiGene (NASDAQ: BGNE), a Beijing clinical-stage novel drug company, raised $158.4 million in its US IPO that showed strong interest. The company priced the offering at the top of the expected range - $24 per share - and increased its size from 5.5 million ADSs to 6.6 million. In its first day of trading, the company's stock rose $4.62 to $28.62, a 19% increase. The transaction is especially impressive in view of the early-2016 stock market turmoil, which prevented any companies from completing IPOs in the US during the month of January.
Sinovac Biotech (NASDAQ: SVA), a Beijing vaccine company, received a privatization offer from management that values the company at $345 million. The offer is priced at $6.18 per share, a 23% premium to Sinovac's previous closing price of $5.02.
Only a few days later, a consortium of outside investors and pharmas topped management's offer for Sinovac with a $7 per share bid. The outside group's offer is 13% higher than management's and values Sinovac at $390 million. Sinovac reported only $65 million in revenues and a small loss over the previous 12 months. EBITDA was $10 million.
Cellular Biomedicine (NASDAQ: CBMG), a US-China biopharma, announced a $43 million investment from Wuhan Dangdai Science & Technology Industries. Dangdai acquired 2.27 million shares of CBMG's stock at a price of $19 each, a 19.4% stake in the company. CBMG is developing two technologies: immuno-oncology therapies, including cancer vaccines, CAR-T and PD-1 technologies, and stem cell treatments for joint and autoimmune diseases. CBMG is headquartered in Palo Alto, California, and operates an R&D facility in Wuxi and a manufacturing plant in Shanghai.
Phagelux, a Shanghai company developing bacteriophages as an alternative to antibiotics, raised an undisclosed amount of capital from Fosun Pharma (SH: 600196, HK: 02196). Mark Engel, CEO of Phagelux, called the transaction a "milestone" and Fosun a "strategic partner." Phagelux operates labs in Nanjing and Montreal. Last month, it opened a pilot production facility in Suzhou, and it plans to open a dedicated lysin development facility in Wuhan this month.
Agena Bioscience of San Diego will collaborate with Guangzhou DaRui Biotechnology to co-develop in vitro diagnostic tests for oncology and inherited diseases using Agena's MassARRAY System. The collaboration will target needs that are specific to China. DaRui will be responsible for CFDA approval and will market the system in China. In the US, the MassArray System is not approved for clinical use.
Government and Regulatory
China is expected to soon announce a massive investment in precision medicine, with plans to spend $9 billion over the next fifteen years. The effort will combine genomic sequencing and clinical patient data to tailor medical treatments to individuals, with the goal of improving care and curtailing waste. China's investment dwarfs a similar US initiative. One year ago, the US announced a $215 million plan, run by the National Institutes of Health, though that effort was spread over just four years. Some of China's money will be allocated to develop new drugs, based on research discoveries.