Deals and Financings
Shaanxi Bicon Pharma, a Xian maker of APIs and finished drugs, received a massive $250 million in fresh capital from private equity fund PAG Asia Capital. PAG spent last year amassing its $1.7 billion war chest and is now deploying funds. Bicon said the investment will be used to make acquisitions and to fund a large complex in Jiangsu province that includes space for R&D as well as manufacturing.
In an unusual move, one private equity fund has sold its majority ownership in a China pharma to three other funds, a rare fund-to-fund transaction. MBK Partners, a PE group based in Korea, sold its 77% interest in Luye Pharma Group, a Singapore listed company that operates mainly in China. According to the Wall Street Journal, the transaction shows that investor funds have more investable capital than attractive targets, while public valuations are low by comparison. The selling price has not been disclosed.
C3 Jian, a spinoff from UCLA, announced a new $30 million funding round, which will allow the company to develop its lead peptide drug for dental caries (tooth decay or cavities) and begin US clinical trials. In 2010, C3 Jian established a China subsidiary, Chengdu Sen Nuo Wei Biotechnology, which opened a clinical research center with West China School of Stomatology at Sichuan University. The center will conduct clinical trials of new oral healthcare products in China.
Shijiazhuang Yiling Pharmaceutical announced plans to invest 138 million RMB ($22 million) into collaborations with other China pharmas to develop innovative drugs. Last summer, Yiling conducted a very popular IPO on the ChiNext exchange. Because of high investor demand, Yiling raised the price of its shares by one-third, ultimately raising $348 million. The company is now investing some of the “unexpected” proceeds into innovation
Tibet Pharma (NSDQ: TBET) announced – almost in passing – that it wishes to go private, ending its short career as a public company (see story). The Chairman of the company, Hong Yu, offered $3 per each share of Tibet Pharma, which is more than four times its previous closing price of $.72. That is an impressive premium, but for investors, the downside is that the company floated its IPO just 13 months ago at $5.50.
Cumberland Pharma (NSDQ: CPIX) of the US has out-licensed the China rights for two of its drugs to Harbin Gloria Pharma (see story). The two drugs are Acetadote, an injectable drug used to treat acetaminophen overdose, and Caldolor, an injectible form of ibuprofen used to treat pain and fever in a hospital. Harbin Gloria will be responsible for obtaining SFDA approval for the two products, and it will also assume marketing and distribution duties.
Shanghai Pharmaceuticals said a subsidiary, Beijing Keyuan Xinhai Pharma, signed a strategic agreement with Guangdong Province’s Center for Disease Control and Prevention. The two entities will set up a joint institute to research cold chain technology in the distribution of biological products, especially vaccines.