China Biotech Review: Tongjitang, WuXi On The Go Since Their IPOs

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Includes: AZN, TCM, WX
by: ChinaBio Today

US Pharmacopeia [USP], the non-profit organization that promotes public health, opened a facility in Zhangjiang Hi-Tech Park in Shanghai. A ribbon-cutting ceremony was held at the new 10,500 square foot lab-office Sunday. The goal of the organization is to help countries and organizations achieve the best pharmaceutical care and quality food ingredients.

To accomplish this, US Pharmacopeia develops standards of quality, which it disseminates to interested parties in 130 countries. USP concerns itself with healthcare delivery, food ingredients, nutritional aids and related products. The China facility, which is the third international lab built by USP following similar ones opened in India and Switzerland, will initially employ 19 people. USP is based in the US. USP has committed itself to working with all of China’s regulatory bodies, as well as with pharmaceutical organizations and manufacturers.

Also during the last week, Tongjitang Chinese Medicines Company (NYSE:TCM) announced its intention to spend $5.6 million of the proceeds from its IPO to buy a fellow traditional Chinese medicines company with complementary products, Guizhou Long-Life Pharmaceutical. The acquisition was priced at less than one times revenues.

WuXi PharmaTech (NYSE:WX) reported Q2 revenues and earnings that were in line with its earlier estimates. Despite the lack of a surprise, the numbers were impressive as WuXi doubled its year-earlier revenues and it increased profits by 482%. Since its IPO one month ago, WuXi has climbed from the $14 IPO price to over $28 per share.

AstraZeneca (NYSE:AZN), long a presence in China, announced its intention to open a clinical pharmacology unit in partnership with Peking University 3rd Hospital. The unit, the first clinical lab for AstraZeneca in China, will be used to conduct Phase I safety trials of drugs that are seeking approval from the SFDA.

Royal DSM N.V. of the Netherlands started construction of a new campus in the Zhangjiang Hi-Tech Park in Shanghai. Besides an R&D lab, the new facility will bring together in one area several business groups of the company, which makes nutritional and pharmaceutical ingredients, in addition to performance materials and industrial chemicals.

In the rumor mill last week, the word was that four Shanghai CROs, each of them residents of Shanghai’s Zhangjiang Hi-Tech Park, are planning their IPOs. The source revealed the name of only one of the four: Shanghai Genomics, which will most likely list its shares on the Tokyo exchange.

And finally, we looked at the recommendations for China from the Organization for Economic Development and Cooperation. The group of 30 free-market economies had some suggestions of what China needs to do if it wants to achieve its goal of instituting an innovation-based economic system. Among other ideas, the OEDC says China needs to stop working on products and begin performing basic research to create true innovation.