Alibaba's (NYSE: BABA) investment arm and Yunfeng Capital offered $1.4 billion to acquire iKang Healthcare (Nasdaq: KANG), a chain of private China healthcare clinics (see story). Yunfeng is a venture capital firm co-founded by Jack Ma, the founder and CEO of Alibaba. Most likely, if the deal succeeds, Alibaba will incorporate iKang's 110 clinics into its own network of online/offline healthcare offerings. Nearly two years ago, Yunfeng made a similar offer, bidding up to $1.6 billion for iKang, an offer that topped one from a rival chain, Meinian Onehealth. However, Yunfeng never closed the deal.

Timwell, a Hong Kong medical device company, will invest $20 million in ReWalk Robotics (Nasdaq:RWLK), an Israeli company that has developed a soft-suit exoskeleton to help patients walk after a stroke (see story). Timwell, ReWalk and RealCan Ambrum Investment will form a China JV to develop, produce and market the Restore exoskeleton in greater China. After the tranched investment is complete, Timwell will own 16 million shares of ReWalk, a 35% share of the company. 

HitGen, a Chengdu discovery company, will collaborate with Germany's BASF to identify small molecule leads for agrochemical crop protection targets (see story). It is the fourteenth collaboration HitGen has announced in its short history, though the first one with an agricultural company. The others are all pharmas. HitGen will use its DNA-encoded library platform to discover novel candidates for the targets. HitGen says its DNA-encoded libraries now contain over 150 billion leads. The company has 20 projects in its own pipeline, while providing discovery services for other pharmas.  

Government and Regulatory

China's government plans to move control over the CFDA, which currently reports directly to President Jinping Xi, into a new agency, the State Administration of Market Supervision (see story). The change is part of a larger reorganization that will reduce the number of ministries by eight and vice-ministries by seven. This implies the move is not a demotion. In fact, when Xi assumed direct control of the CFDA about five years ago, the agency was in crisis mode. It had a huge backlog of new drug applications that was growing, not declining, and Xi took over. Now, the backlog is gone, and drug approval times have been shortened, due to administrative reforms and more CFDA staff.  

Trials and Approvals

XW Labs, a CNS company with R&D operations in Wuhan and Taipei, will start an Australian Phase I trial of its lead candidate (see story). XW10172 is a small molecule treatment aimed at narcolepsy. The trial will enroll patients who have type 1 narcolepsy with excessive daytime sleepiness and cataplexy (the sudden onset of muscle weakness following strong emotions). According to XW, current treatments for narcolepsy that address EDS and cataplexy are often associated with limiting side-effects and poor compliance.  

In a review its drug development progress, Hutchison China MediTech (Chi-Med) (AIM/Nasdaq: HCM) reported it expects China approval of its first novel drug in 2018 and that it also spent $88 million on novel drug R&D last year (see story). During 2017, Chi-Med completed a Phase III trial of fruquintinib, its VEGFR inhibitor for colorectal cancer. It is awaiting CFDA approval of its Suzhou production facility as the last step of the process. All together, Chi-Med has eight candidates in clinical trials in 36 different indications.  

News and Analysis

United Biopharma, a Taiwan based pharmaceutical company, will build a mAb manufacturing facility in Yangzhou, China to supply the China market with its novel and biosimilar candidates (see story). To finance the facility, UBP Yangzhou signed a $40 million loan agreement with Yangzhou High Technology Industry Park. Using these funds, UBP Yangzhou will partner with GE Healthcare Life Sciences to supply the facility with six single-use bioreactors (2x200L, 3x500L and 2x2000L). This facility is expected to test run in June 2019. In Taiwan, UBP will work with GE Healthcare to establish a contract development and manufacturing (CDMO) service.  

Loncar Investments has launched its Loncar China Biopharma Index (LCHINA), an index comprised of 32 China publicly traded biotech companies (see story). The index, which is re-priced once a day, includes innovative life science companies that are listed in Hong Kong or on Nasdaq. Loncar said it introduced the LCHINA Index because of the growing interest in China biopharma investments, creating the need for a read on the strength of the sector. The Index started operating on February 13, 2018, at a value of 1,000. One month later it is at 1129.71, a 13% increase.