China Biotech Week in Review: More Support for Biopharma

Includes: MDT, MR, QGEN, SCR, SNBP, WX
by: ChinaBio Today

The 12th Five Year Plan (2011-2015) for the biopharmaceutical industry may have over 10 billion RMB ($1.5 billion) in development support for new drugs (see story). The plan is in final draft form and may be announced in late August, according to unnamed sources that were quoted by the 21st Century Business Herald.

In 2009, the total output value of China’s pharmaceutical sector topped 1 trillion RMB ($148 billion), according to SFDA Director Mingli Shao (see story). That was up 20% from 2008’s output of 867 million ($127 billion), a total reported by Wicon. Since 2005, when the sector’s output equaled 568 million RMB ($84 billion), China’s pharmaceutical sector has grown at a CAGR of 23%.

WuXi PharmaTech (NYSE: WX) will spend $100 million to build a new R&D facility in the central China city of Wuhan (see story). The company will construct a 40,000 sq meter CRO facility in the Wuhan National Biological Industry Base (Optics Valley of BioLake). Wuhan sources told ChinaBio that a cooperative agreement between WuXi and the Wuhan Biological Base was signed on August 9.

Kanghui Holdings (NYSE: KH), a China orthopedic device maker, priced its IPO in the exact middle of its expected range, $10.25 per ADS, raising a total of $68.4 million in the offering (see story). The pricing showed investors took a favorable read on Kanghui’s business, an interest also shown in subsequent open market trading. Kanghui’s ADSs rose 88 cents to $11.13, a 9% increase, in early NYSE action.

In a mixed Q2 financial report, Mindray Medical (NYSE: MR), a major China medical device company, reported higher numbers for the period, though revenues were below analysts’ predictions (see story). The company blamed the miss on a decline in its Q2 China revenues, largely because of a shortfall in its revenues from government tenders. International sales, on the other hand, remained robust, rising 27%.

QIAGEN (NSDQ: QGEN) expects its China revenues to double this year, riding a wave of demand for its core sample and assay technologies (see story). Last year, QIAGEN experienced a 90% increase in China sales, leading the company’s Asia Pacific region to a 40% gain, according to the head of the Asia Pacific division, Victor Shi.

Tianjin Tasly Pharmaceutical (SHEX: 600535) said its patented TCM treatment for angina, Compound Danshen Dripping Pills, posted positive results in a Phase II trial conducted in the US (see story). The FDA has also given its go-ahead to move the drug into Phase III trials, according to Tasly. Assuming a positive outcome for the trial, the company hopes to launch the drug in the US as early as 2013. Tasly said Danshen is the first TCM drug approved by the FDA for Phase III trials.

Sinobiopharma, Inc. (OTC:SNBP), a US-headquartered company that operates entirely in China, will co-develop, manufacture and commercialize Eplerenone, with Jiangsu Lianhuan Pharmaceuticals (see story). Eplerenone is an aldosterone antagonist used as an adjunct to treat hypertension and heart failure. Sinobiopharma will receive 60% of the profits.

Simcere Pharmaceutical Group (NYSE: SCR) reported that its China subsidiary, Simcere Dongyuan Pharmaceutical Co., was granted SFDA approval to manufacture and market Palonosetron material and injections (see story). Palonosetron is given to prevent the nausea and vomiting side effects of chemotherapy. Simcere, which focuses on branded generics, already markets four other drugs that treat cancer.

Disclosure: none.