Deals and Financings
Chongqing Huapont Pharma (SHE: 002004) will raise $146 million in a private placement, which will be spent on four projects: $47.5 million on a new R&D center; $44.3 million to increase production capacity; $33.3 million on a topical formulation facility, leaving $19 million for general corporate use. Huapont, which produces APIs, intermediates and finished drugs, is primarily known as a dermatology company.
Lee's Pharmaceutical of Hong Kong signed a term sheet with RegeneRx Biopharma [OTCBB: RGRX] of the US to in-license the China rights for three Thymosin Beta 4-based drug candidates. The three products are currently in Phase II trials in the US. Lee's Pharma will make $400,000 in upfront payments, plus it is responsible for $3.6 million in milestones.
GlaxoSmithKline (NYSE: GSK) and Hanmi Pharma, a Korean company, agreed to co-develop and co-market drugs they call Evidence Based Formulation (EBF) products (see story) . The two companies will co-market their products in Korea and China, while GSK will be responsible for selling them in other territories. According to the agreement, Hanmi will perform the formulation research, early clinical studies and manufacturing; GSK will be in charge of late-stage clinical studies and registrations.
Hubei Minkang Pharma [OTCBB: HBMK] has signed a MOU with Hubei Merryclin Pharma to acquire a 30% to 51% interest in Merryclin. As part of the agreement, Minkang will gain immediate use of some GMP certified production facilities belonging to Merryclin. Minkang said the stake in Merryclin would require only a "modest" capital injection. Minkang makes TCM products along with some chemical drugs.
Big Pharma in China
Bayer HealthCare [Xetra: BAY] extended its research partnership with Beijing's Tsinghua University for another three years. In 2009, the two parties established the Bayer-Tsinghua Joint Research Center for Innovative Drug Discovery (BTC). At the BTC, projects include basic disease research, identification of new drug targets and medicinal chemistry programs. A new research area will be structural biology.
GE Healthcare, the medical device subsidiary of General Electric (NYSE: GE), will seek to increase its China revenues by expanding beyond top tier markets (see story). The company plans to introduce 32 new products in China over the next five years, 70% of which will be aimed at grassroots institutions. GE wants to generate 50% of its China revenues from these institutions by 2017, up from less than 20% at present.
Roche (OTCQX:RHHBY) will "significantly" reduce the price the company charges in India for two expensive biotech cancer drugs - Herceptin and MabThera (known as Rituxin in the US) (see story). The move came two weeks after India stripped Bayer of its exclusive license to market the cancer treatment Nexavar in India. As part of the ruling, India allowed a local company to produce Nexavar at a price of $172 per month, a 97% reduction from the $5,500 that Bayer charged. So far, Roche has not agreed to lower prices in China as well.
Novasep, a French CMO and purification products supplier, opened a new 21,400 square foot facility in Shanghai's Pudong district. The company began operating in China in 2006, but as its business grew, the original facility became too small. The new facility, which will join Novasep's 12 existing facilities in Europe and the US, will serve China and East Asia.