Week In Review: Illumina Pays $8 Billion To Acquire GRAIL, An Early-Stage Cancer Testing Company

Deals and Financings

• Illumina (ILMN) will acquire Grail, an Illumina spin-out that is developing an early screening test for multiple forms of cancer, for $8 billion in cash and stock (see story). Before Grail was acquired by Illumina, Grail merged with Cirina, a Hong Kong company that had developed the novel technology that was the cornerstone for Grail's cancer test (see story). Cirina was backed by Decheng Capital, a healthcare venture capital firm with offices in Silicon Valley and Shanghai.
• JD Health, a Beijing online healthcare company started by China e-commerce giant JD.com, plans to raise $3 billion in a Hong Kong IPO later this year, according to unofficial sources (see story). In August, JD Health completed an $830 million Series B funding led by Hillhouse Capital at a $12 billion valuation. JD Health offers 30-minute delivery of pharmaceuticals, a telemedicine service that saw increased demand during the COVID-19 pandemic, and health services such as genetic testing.
• Sequoia Capital China is raising $2.2 billion for a new yuan-denominated fund, the company's sixth fund (see story). The company has invested in about 600 China companies in sectors that include TMT, healthcare, consumer/service, and industrial technology over the past 15 years. Sequoia China's website lists 40 healthcare members of its portfolio, including Innovent, CStone, Zai Lab (ZLAB), and Venus MedTech. The new fundraising is significant because it shows Sequoia, a US company, is committed to building its China business, despite rising diplomatic tensions between the two countries.  
• Genor Biopharma, a Shanghai company, is conducting a Hong Kong IPO that could raise up to $370 million (see story). The company is developing a clinical-stage portfolio of 14 mAbs and recombinant fusion proteins, a combination of novel drugs and biosimilars that target indications in cancer, metabolic, and autoimmune diseases. In June, Genor completed a $160 million Series B financing led by Beijing's Hillhouse Capital Group.  
• Viva Biotech (HK: 1873) of Shanghai will pay $80 million to acquire fellow drug CRO SYNthesis Med Chem (Hong Kong) (see story). SYNthesis is a preclinical small molecule drug discovery CRO that specializes in high-end pharmaceutical chemistry and synthetic chemistry services. The company has labs in Suzhou, Shanghai, and Australia. SYNthesis' expertise is "downstream" from Viva's structure-based drug discovery services. One month ago, Viva announced a $368 million deal to acquire an 80% stake in Zhejiang Langhua Pharma, a CDMO and API company.  
• Sperogenix Therapeutics of Beijing in-licensed a CNS drug from Barcelona's Minoryx Therapeutics in a $78 million agreement (see story). Sperogenix will own China rights to leriglitazone, a brain penetrating disease-modifying PPAR-y agonist. The candidate is a proposed treatment of X-linked adrenoleukodystrophy (X-ALD), a rare life-threatening disease. Sperogenix was formed in 2019 with backing from Lilly Asia Ventures and Morningside Venture Capital to bring later clinical stage and commercial stage treatments for rare diseases to China.  
• ImmVira Group, a Shenzhen biotech, raised $10 million in a Series B to develop its next-gen genetically modified oncolytic viruses for cancer (see story). The financing was entirely funded by Shanghai Healthcare Capital, which is affiliated with Shanghai Pharma. In August, Shanghai Pharma in-licensed ImmVira's MVR-T3011 oncolytic virus program in a $165 million deal.  
• BioDuro and Sundia, two pre-clinical China-US CROs, have merged to form one of the largest CRDMOs with operations in China and the US. As part of the deal, Advent, a Boston  private equity investor, will lead a majority investment in Sundia. In early 2019, Advent acquired control of BioDuro, also via a majority investment. The new company, which will operate as BioDuro-Sundia, will offer drug discovery, development, and manufacturing for both APIs and drug products. Bridgewest Capital was a co-investor in Sundia.

Trials and Approvals

• Sinovac Biotech (SVA) announced the start of a Phase III trial of CoronaVac, its COVID-19 vaccine, in Turkey (see story). The trial will first enroll 1,300 healthcare workers between the ages of 18-59, who will receive two doses of vaccine or placebo at a two-week interval. Then, it will enroll 12,000 members of the general public under the same protocol. Sinovac has also completed China Phase I/II trials of the vaccine in adults and elderly people with seroconversion rates above 90%. The vaccine was well-tolerated, Sinovac added.
• XiangXue Life Sciences received US permission to start a Phase I trial of its high affinity specific T-cell receptor candidate, TCRT-ESO-A2 (see story). The molecule is China's first TCR-T candidate to target solid tumors, aiming at tumors that are NY-ESO-1 positive in HLA-A*02:01 positive patients. XLifeSc is a subsidiary of Guangzhou XiangXue Pharma (SHZ: 300147) that focuses on TCR therapies for cancer. TCRT-ESO-A2 is being developed globally (ex-China) by Axis Therapeutics, a JV formed by XLifeSc and Athenex, a US-China biopharma.

Company News

• Legend Biotech (LEGN) of Nanjing announced its CEO, Dr. Fangliang Zhang, is under China house arrest, presumably because of alleged violations of China import and export regulations (see story). Officials from China Customs Office appeared in Legend's offices on Friday, September 18 to conduct an inspection. Fierce Biotech believes authorities were most likely looking for violations of China's tightened rules for export of human genetic resources or import of plasma products. Legend's lead candidate is a BCMA-targeted CAR-T cell therapy that it partnered with Janssen in a $1 billion deal.