Week In Review: Alibaba Bids $1.4 Billion For IKang, A Chain Of China Healthcare Clinics

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.  

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