Deals and Financings

Cirina, a Hong Kong cancer diagnostics company, will merge with GRAIL, a Menlo Park startup, which is also developing non-invasive early-stage molecular cancer diagnostics (see story). GRAIL is a spin-out from Illumina (NSDQ: ILMN) that has raised an impressive $1re capital. The merger combines GRAIL's deep pockets, which will fund large-scale clinical trials, with one of the scientific leaders in the fiel billion in ventud, Dennis Lo, DM, DPhil, a co-founder of Cirina. He is joined by other co-founders of Cirina, Rossa Chiu and Allen Chan at the Chinese University of Hong Kong, and lead investor, Decheng Capital. 

LYFE Capital, a life science investment firm, closed LYFE Capital Fund II with $420 million in capital, consisting of $289 million and another RMB 900 million ($131 million) committed (see story). LYFE II was oversubscribed: its original target was $230 million and RMB 800 million. The new fund will continue the firm's strategy, which focuses on equity transactions in China healthcare, starting at early growth stage. This includes companies in the pharmaceutical, medical device, diagnostics, animal health, healthcare services and digital health sectors. LYFE has offices in Shanghai, Hong Kong and, recently, Palo Alto, California. 

The Shenzhen International Institute of Biological Research signed a memorandum of understanding with Israeli pharma Zion Medical to develop two drug candidates in China (see story). Zion said the value of the deal was $440 million. Details of the MOU are not known, though some investment in Zion, a virtual company, is included, and probably SIIBR will contribute early-stage drug development on the candidates, a strong suit of the institute. One of the molecules is a cancer treatment, the other a cure for AIDS/HIV with a novel mechanism. Both molecules were discovered at the Hebrew University of Jerusalem by Prof. Abraham Loyter and in-licensed by Zion. 

InventisBio, a Shanghai-US startup, raised $19 million in a Series B round for its portfolio of four small molecule candidates (see story). The two-year-old company is targeting cancer (lung and breast) and gout indications, developing molecules that might be paired with immuno-oncology therapies. It hopes to start clinical trials on three of the candidates in the US and China this year. The investment was led by OrbiMed Asia Partners and joined by Lilly Asia Ventures. 

OBI Pharma (TWO: 4174), a Taiwan company, acquired rights to a preclinical cancer drug candidate from Threshold Pharma (NSDQ: THLD) of South San Francisco for an undisclosed, one-time upfront payment (see story). TH-3424, now renamed OBI-3424, is a first-in-class small-molecule prodrug. It is designed to release a DNA alkylating agent only in cancers that over-express the activating enzyme aldo-keto reductase 1C3 (AKR1C3). OBI intends to develop the drug initially in the US. The agreement does not include Japan, China, Taiwan or certain other countries. 

Essex Bio-Technology (HKEX: 1061) of Guangdong will co-develop a novel biologic therapeutic discovered by Switzerland's AC Immune (NSDQ: ACIU) (see story). The preclinical candidate is aimed at neurodegenerative diseases and neuroinflammation. In 2016, Essex invested $5 million in AC Immune for a 1% stake in the company. Essex focuses on recombinant DNA products that treat wounds, eye problems and CNS disorders. AC Immune develops treatments for neurodegenerative diseases. Financial details of the agreement were not disclosed. 

Trials and Approvals

The first China clinical trial using human embryonic stem (ES) cells will soon get underway. Zhengzhou University researchers in Henan Province plan to implant four million neuronal-precursor cells, developed from embryonic stem cells, into the brains of patients with Parkinson's disease (see story). The goal will be to address the dopamine deficit that causes Parkinson's. The test will be the first China clinical trial of ES cells since 2015, when China adopted new rules to regulate stem cell experimentation and outlaw unproven stem cell treatments. 

Hutchison China MediTech (Chi-Med) (AIM/NSDQ: HCM) reported positive survival data for its lead drug, fruquintinib. In a pivotal Phase III China trial, fruquintinib increased median survival in 416 colorectal cancer patients from 6.6 months to 9.3 months, a 41% improvement (see story). Chi-Med released the data in conjunction with the current ASCO meeting in Chicago. In March, the company announced the trial was successful, but did not release details. Chi-Med, which partnered China development of fruquintinib with Lilly (NYSE: LLY), plans to file an NDA with the CFDA for the drug. 

TaiGen Biotech (TWO: 4157) of Taiwan submitted a New Drug Application in China for the IV formulation of Taigexyn®, an antibiotic for drug-resistant infections (see story). TaiGen already has CFDA approval for the oral form of the drug, a novel non-fluorinated quinolone antibiotic. The IV formulation of Taigexyn proved non-inferiority to levofloxacin in a Phase III trial among patients with moderate to severe community-acquired pneumonia. Taigexyn's clinical success rate was 92% vs. 86% for levofloxacin. 

Government and Regulatory

China has been accepted as a member of the ICH (International Council for Harmonization of Technical Requirements for Pharmaceuticals for Human Use) (see story). The ICH is a world-wide organization, originally set up by the US, Europe and Japan in 1990 to standardize global drug regulations (approvals, good manufacturing practices, etc). The news means that China intends to continue reforms that will bring China drug regulation into line with international standards. Because of the acceptance, it should become easier for drugmakers, in China and ex-China, to bring their products across borders. But how much easier and when the reforms will take effect -- those remain open questions.