Deals and Financings

WuXi PharmaTech (NYSE: WX), a China-US CRO/CMO, announced its SynTheAll Pharma subsidiary, a small-molecule manufacturing company will raise $80 million through a private placement of 6% of its shares (see story). The financing values SynTheAll at $1.3 billion. In April 2015, WuXi completed a listing of the subsidiary on China's Third Board, a two-year old electronic OTC exchange. WuXi, which pointed out that STA does not include WuXi's biologic drug manufacturing operations, continues to hold an 89% stake in STA, worth about $1.16 billion. 

Mindray Medical (NYSE: MR), a China medical device maker, will pay $72.6 million to acquire the remaining part of Wuhan Dragonbio Surgical Implant Co. it does not already own (see story). In 2012, Mindray bought a controlling stake in Dragonbio for $35.5 million. Dragonbio, which specializes in trauma, spine, joint implant and fixation orthopedic products, reported revenues of only $7.7 million in 2011. Although Mindray is currently considering a $3.5 billion privatization offer from its management, the company seems to remain interested in M&A.

Oramed Pharma (NSDQ: ORMP) of Jerusalem signed a LOI to complete a $50 million deal for China rights to its clinical-stage oral insulin with Sinopharm Capital Management and Hefei Life Science & Technology Park Investments and Development (see story). During the previous week, Oramed announced a similar deal (though not identical) with Wuzhou Zhongheng Group (SHA: 600252), an agreement that apparently fell apart. Sinopharm/Hefei paid $500,000 for 60 days of exclusive talks with Oramed, while final terms of the agreement are negotiated. 

Benitec Biopharma (ASX: BLT; OTCPK: BTEBD) of Australia will pay $4.5 million to buy out its China JV partner, Biomics Biotech (see story). The acquisition gives Benitec full control of Hepbarna™, a pre-clinical ddRNAi-based hepatitis B therapy that the JV was developing. Both companies focus on developing RNAi therapeutics. Benitec will pay $1.9 million upfront and another $2.6 million plus a single digit royalty if Hepbarna is commercialized. 

Cathay Capital Private Equity invested in Cenexi Group, a French pharmaceutical contract manufacturing organization (see story). Cathay's goal is to help Cenexi become a global company, adding US operations. Cathay, with offices in Shanghai, Beijing, New York and Paris, specializes in cross-border growth, either through internal expansion or through M&A. Cenexi was spun out of Roche in 2008 and specializes in making high value-added sterile products. The size of the investment was not disclosed. 

ASLAN Pharmaceuticals, a Singapore clinical-stage biopharma, will collaborate with ACT Genomics of Taiwan to undertake detailed genomic studies of patients who exhibit better-than-expected therapeutic responses to a given therapy (see story). As an example, in a clinical trial of ASLAN001, one patient with bile duct cancer experienced an 87% shrinkage in the tumor, a very positive reaction in a type of cancer that is difficult to treat. ACT is combining next-gen sequencing and multiplex molecular testing platforms to develop clinical molecule assays.

Trials and Approvals

AstraZeneca (NYSE: AZN) and Ironwood Pharma (NSDQ: IRWD) reported positive results from a global Phase III trial (including China) of linaclotide in patients suffering from irritable bowel syndrome with constipation (see story). The drug met all primary and secondary endpoints in the trial. The two companies plan to file for CFDA approval of linaclotide in early 2016. AstraZeneca signed a $150 million deal with Ironwood in 2012 to share China regulatory and marketing responsibility for the drug, which Ironwood discovered. 

Industry Insights

China ordered a halt to new IPOs on its two domestic exchanges, Shanghai and Shenzhen. The move seeks to stop a precipitous month-long decline of over 30% in the exchange indexes, including a 7% drop last weekFriday (see story). The government hopes the hiatus in new offerings will encourage investors to hold on to their present holdings, rather than selling them to buy new offerings. In addition, the nation's largest stock brokerage companies agreed to buy $19.3 billion worth of stock in already public companies, another move that could support stock prices. 

Company News

BioNano Genomics of San Diego signed up China's Gene Company to distribute its genome mapping device, the Irys® System, in China with the exception of Shanghai (see story). The Irys platform detects a genome's structural variations, the insertions, deletions, inversions, translocations and repeats that BioNano calls the "inaccessible genome." Irys is intended to be used in tandem with genomic sequencers. In November 2014, BioNano raised $53 million in a C round that was co-led by Beijing's Legend Capital.