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News Jun 7, 2020 05:55 pm EqualOcean

FD Zhangjiang Will Make Subscription Tomorrow

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Jul 9, 2020 07:40 pm · Harbour Biomed

Anti-cancer Drug Maker Harbour Biomed Receives USD 102.8 M in Series C

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Jul 7, 2020 11:10 pm · https://mp.weixin.qq.com/s/kg8ECgzgWr1BZczDuNcyoA

Obio Technology Receives CNY 200 Million in Pre-Series C

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Jun 19, 2020 11:56 am ·

HK Stock Shanghai Fudan-Zhangjiang Back to SSE Star Market

► Fudan-Zhangjiang Biotech goes public on the Star Market today. ► This follows a trend that is seeing many Hong Kong-listed Chinese pharmaceutical companies go back to list among China's A-shares, with Shanghai's Star Market a coveted destination. Fudan-Zhangjiang, the Hong Kong-listed biopharmaceutical company, began trading on the Shanghai Star Market at a public offering of CNY 8.95 per share, for 120 million shares. The opening price soared to CNY 35, close to fourfold the IPO price. According to the prospectus, it plans to raise a fund of CNY 650 million. It has invested CNY 230 million in the US registration project for Hemporfin, CNY 240 million in a sustainable project for innovative biopharmaceutical medicine and CNY 180 million in acquiring minority shares of Taizhou Fudan-Zhangjiang. This IPO is sponsored and underwritten by Haitong Securities, with participation from the other lead underwriter, China International Capital Corporation (CICC). At its IPO, the company’s price-to-earnings ratio (PE) reached 46.93. This Shanghai-based biotech giant gained revenue of CNY 227 million in 2019, over 102.7% higher than its 2018 revenues, with a revenue CAGR of 57.59% from 2017 to 2019. Fudan-Zhangjiang mainly provides services in biopharmaceutical innovative research and development, manufacturing and marketing. Its photodynamic technology has reached a world-class level and primarily levers this cutting-edge tech in skin venereal disease treatment and oncology therapies, backed by its advanced nanotechnology and genetic engineering. Fudan-Zhangjiang is not alone. More dual-listed pharmaceutical companies are eyeing the golden opportunities in the Shanghai Star Market. The first ‘NEEQ + H’ stock Junshi Biosciences (1877:HKEX) boarded on the Star Market this May following an estimated valuation of over HKD 20.1 billion publicized last November. Its key product, ‘Tripleitumab,’ as the first-ever domestic PD-1 monoclonal antibody, brought a considerable boost in sales in 2019. All this can be attributed to the R&D investment of CNY 1.9 billion during the last four years. The Star Market actively welcomes a variety of high-value biotechnology companies, in particular those with sustainable and robust capabilities in research and development – with key attributes being “overvaluation of over CNY 4 billion”, having an “extensive market size,” and “at least one core product moving into clinical Phase II.” Zelgen (688266:SH), the first A-share list innovation-driven pharmaceutical, focuses on oncology, hemorrhage, blood disease and hepatobiliary diseases. It landed on the Star Market at an IPO issuance price of CNY 33.76, with a closed stock price of 120.94%, higher than the issuance price at a valuation of CNY 17.9 billion. Bio-Thera Solutions (688177:SH) is Guangzhou-based biotechnology firm dedicated to studying innovative drugs and biosimilar medicines. It mentions the most significant operational risk as considerable losses in its prospectus. The continued COVID-19 pandemic is raising the wind of investment into research and development. It is the right moment for biopharmaceutical companies listed on the Hong Kong Stock Exchange to look out for more listing opportunities. The Chinese A-market, widely known for overvaluation in dual-listed companies, provides a promising solution.

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Jun 3, 2020 11:36 pm · official site of NMPA

BeiGene's New Drug Zebutinib Approved for Market in China

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Jun 3, 2020 03:06 pm ·

New Normal, New Policies: A Focus on Healthcare in Two Sessions 

► China's Two Sessions has touched upon healthcare in five major fields: primary care, medical informatization, insurance, 'aging businesses' and women's health. ► Digital transformation in healthcare, broader insurance coverage and more gender equality in reproduction — this article highlights the three. As part of the 13th ‘Two Sessions’ meeting, the third session received 54 healthcare-related proposals from people’s representatives for one week. These proposals are submitted by people’s representatives from all walks of life, from the principal at a children’s hospital, headmaster at college, village doctors, lawyers, officers to entrepreneurs.  In the major trend of healthcare reform, many healthcare-related topics were covered and still are heatedly discussed – these can be generally divided into public healthcare, medical informatization, healthcare insurance, aging industry and women’s health. From the perspective of technology and equality, EqualOcean has selected three topics and looked into the proposals to see how far ahead we can imagine, starting from today’s words on the paper. Healthcare informatization: Internet, information and data There are eleven proposals about informatizing the healthcare business, showing a robust shared will to digitize this industry, from very down-to-earth suppliers, industry chain and business elements. The first proposal was put forward by Mr. Lee Xiaojia (李小加), the Hong Kong Stock Exchange CEO. He suggested asking the Shenzhen Reform Commission to take the lead in accelerating the cultivation process of the data market in a joint effort with the National Development and Reform Commission. In the wind of healthcare reform, the medical data market is the ideal starting point from his side. As the representative of Chinese capital institutions, Mr. Shen Nanpeng (沈南鹏), the global CEO of Sequoia Capital, also submitted a healthcare-related proposal. This globally known VC investor pointed out the immaturity of China’s current medical informatization. This shortcoming has severely depressed an overall performance of medical supply and the ‘Information Island’ phenomenon hinders the accessibility of high-quality medical resources. As part of the solution, this proposal stresses the popularity and application of big data and AI to improve both software and hardware capabilities. There are several voices from enterprises in the field of consumption goods. Mr. Ding Lei (丁磊), the CEO of NetEase, proposed establishing big data centers for patients on the national level. It is critical to identify and treat the initial signs of severe diseases by leveraging big data computation, cloud, dynamic diagnosis and medical imaging. Similar was the message from the voice from Mr. Yang Yuanqing (杨元庆), the board of Lenovo. His plan depicts a new generation of healthcare Internet platforms and a ‘Digital Family Doctor’ platform as part of an IoMT (Internet of Medical Things) solution constructed on community-divided units. Last but not least, the representatives of the medical world tend to speak on more practical issues. Mr. Sun Piaoyang (孙飘扬), the board of Jiangsu Hengrui — an oncological pharmaceutical manufacturer – provided his feedback on the ‘Measure for the Administration of Drug Registration.’ He thinks this set of measures should cover an abundant variety of innovative drugs, considering that these ‘new drugs’ need to be thoroughly tested during clinical stages before the market. “The point of the measure is to utilize patents to protect those companies who devoted considerable time and money on developing new drugs and hinder those potential free-riders,” says the board of this Chinese pharmaceutical flagship. He believes it necessary to add a clause to protect innovative medicines — three-year data protection for general ones and four years for those new indications. Healthcare insurance: More diverse coverage When it comes to the living quality of grassroot organizations, healthcare insurance is one topic coming into the limelight. This session heard many suggestions standing for a variety of age groups, from patients with chronic disease, senior population to pregnant women. A diverse discussion indicates a positive outlook for a more open policy and incubates a promising insurance business. The China Banking Regulatory Commission issued new commercial insurance guidelines in the field of social service and healthcare this January. In this field, some initiatives focus on the infrastructure and public services of healthcare insurance. Representative Hu Jiqiang (胡季强), the board of Conba Group (康恩贝集团) — a pharmaceutical manufacturer, pushes to accelerate the legalization and implementation of healthcare insurance. Another representative in telehealthcare, Mr. Yang Wenlong (杨文龙), the board of Dingdang Medicine Express (叮当快药) — an O2O (online to offline) medicine distributor, submitted drafts about the Internet-based medicine industry. He advised establishing an integrated healthcare platform providing an all-in-one service, namely a ‘doctors + physical check + medicine + insurance’ management platform.  Besides, more people’s representatives want to expand healthcare insurance coverage to benefit weaker groups, such as the old, sick, and pregnant. Home visits for patients with severe chronic disease, consecutive care for the senior, Class-B OTC drugs, and postpartum depression are highlighted to be incorporated into the coverage of insurance. Above all, an inevitable trend is more diversity and more public welfare. Women’s health: A late focus Another particular field this year is women’s health. It is good to see this meeting regarding it as critical, but ironically only three proposals emerged. This year, three topics focused on were: HPV vaccines, talent education dedicated to women and children’s health, and single women’s reproductive rights.  Critical and reasonable to address female rights –  yet this also comes quite late.  The first HPV proposal was put forward by Mr. Yu Luming (于鲁明), the head of the Beijing Healthcare Security Administration. He suggested incorporating this particular vaccine into the National Immunization Program (NIP) and making it free for girls aged between nine and fourteen.  Not to exaggerate, the HPV vaccination proposal has been delayed for one generation. Human Papilloma Virus (HPV) is the leading cause of cervical cancer. China has more identified cases than in any other country, accounting for 20% of all cases worldwide in 2018. The current HPV vaccination rate of females aged 9-45 is less than 0.05%, with less than 5% in girls aged 9-14. Although more Chinese ladies are more aware of the significance of this matter than ever before, the supply end and reimbursement have been far from satisfactory. The Chinese HPV vaccine market has long been dominated by some foreign pharmaceutical giants like GlaxoSmithKline (GSK) and Merck & Co. Now some domestic vaccine maker Wantai Pharma (万泰生物) are uprising, undertaking the expectation to provide insured vaccines. Single females’ freedom to give birth with medical support is another heatedly discussed issue. Inspired by the ‘first case of frozen eggs in China’ last December, Ms. Peng Jing (彭静), a lawyer from Chongqing, called on the meeting to address the quality of reproductive rights. The existing Regulation on Assisted Reproduction of the PRC 2003 bans the assisted reproductive techniques for single women. However, this violates the second clause in the Law on the Protection of the Rights and Interests of Women, which states that women enjoy equal rights with men – consider that men, regardless of whether married or single, are eligible to store semen. This virtual Two Sessions closed with surprising and promising in-depth healthcare reforms. For some, these proposals show a positive start, while for others, they are more like an ex post facto revamp. But it shows encouraging signs of progress in any case.

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May 22, 2020 10:52 pm ·

Jiangsu Hengrui, Chinese Cancer Drugmaker Emerging from the Shadows

► Jiangsu Hengrui has shown a very positive future growth driven by heavy investment in R&D along with stains – several cases of corruption scandals in the history. ► As China's healthcare reform, more pharmaceutical companies are being monitored in the public. Looking at the oncology pharmaceutical market in China, Jiangsu Hengrui (600276:SH) has been deemed one of the flagships of recent years – unexpectedly, as the story is one of an outlier that somehow witnessed the whole history of the domestic pharmaceutical industry. Founded as a traditional medicine factory in 1970, it advanced to become a high-tech firm in 1999, listed on the Shanghai Stock Exchange market in 2000, was approved for sale in the US in 2011 and was granted the European CE mark in 2012, etc. During the last decade, this healthcare giant has evolved to become a medicinal innovator from being only a generic drug manufacturer. In a brief overview of its product portfolio – Hengrui Medicine has covered oncology drugs, narcotics, contrast agents, cardiovascular medicines, injections and antibiotics with prominent popularity in the first three aforementioned products.  As this high-tech-driven global pharmaceutical brand boasted of its 2019 performance, with an over 30% increase in both gross margin and net margin, it soon came out that a corruption scandal was brewing, just one month after its disclosure of its annual report in April. Here is a case of the ‘shadow in the sun.’ Although it is not uncommon to be 'surprised' by the many corruption incidents in healthcare businesses, it is still an 'intolerable' fact. It cannot help but leave the market wondering whether the next big deal will be more real or more fake? An artificial light bulb or natural sunshine? Monetizing innovation power? R&D is undoubtedly the value driver, but how efficient is it? For an innovative medicine provider, research and development is one major growth engine. The year of 2019 saw an R&D investment of CNY 3.9 billion, as much as 16.7% of the revenue. It claims that it has devoted around 15% of revenue to developing new drugs in recent years – a ratio that just hit the required R&D threshold of Chinese Star Market-listed companies.  Powered by a research team of over 3,400 people, including over 2,000 with advanced degrees above post-graduate level, this giant has a wide range of on-going pipelines covering oncological auxiliary treatments, immune system and respiratory system-related problems and other chronic diseases, such as diabetes. In 2009, six products in the pipes obtained periodic breakthroughs; among them there were two most noteworthy improvements. The first was the approval for remazolam toluene sulfonate for injection ('注射用甲苯磺酸瑞马唑仑') to go to the market. As a safer, more effective narcotic alternative, this is expected to be applied to routine gastroscopy. This treatment for fiber bronchoscopy sedation has just been approved to enter its Phase III clinic trial on May 15. The other breakthrough is the launch of camrelizumab ('注射用卡瑞利珠单抗'), a kind of PD-1 monoclonal antibody, approved in May 2019. However, it is a heated-competed arena. On a global scale, there are seven pharmaceuticals approved to sell these antibodies, including four Chinese companies – Jiangsu Hengrui, Shanghai Junshi Biosciences (1877:HKSE), Innovent Biologics (1801:HKSE) and BeiGene (6061:HKSE). However, this business progression is not as sexy as it looks. In a look at the 2019 market, the global sales revenue of this PD-1 antibody was USD 18.9 billion. Hengrui has been a little behind, since it is not only a late entrant, but also provides more expensive products, without healthcare insurance incentives to patients. Hengrui's PD-1 antibody is the most expensive, at a unit priced at four times from Innovent Biologics at the same amount(milligram). To take a share out of the tripolar-dominated market size, it introduced a more aggressive selling strategy. No player wants to lose its portion of the market pie by being stingy. A direct result of the discount price war is that all end up giving away a lot of profits. In an estimation about their post-discount revenues, Jiangsu Hengrui sent out 19.8 units, followed by Innovent Biologics at 14.2 units and Junshi Biosciences at 12.5 units (calculated by ex-ante expected unites minus ex-post units). As of March 2020, Hengrui has invested over CNY 893.4 million in developing this product.  An international medical giant, Hengrui never lacks in Plan Bs. Late in the first quarter this year, Hengrui announced that it plans to yield its patent and related legal use rights (exclusive clinical development, registration and sales in the market) to CrystalGenomics (083790:KOSDAQ), a Korean public biotechnology company, for a decade. This license-out will guarantee Hengrui a USD 1.5 million front-pay, R&D and market launch milestone pays totaled at up to USD 2 million, and sales milestone pays of up to USD 84.25 million and 10-12% from net revenue since the commercial stage. Hard to do a ‘clean’ job – but it has to be done However, no matter how flashing and eye-catching its business tricks and financial performance look, it has acquired noticeable stains – like many other pharmaceuticals. This May saw a breakout scandal about sales corruption in Hengrui Medicine. The pharmaceutical company bribed the head of the anesthesia department at Lishui ('丽水') Civic Central Hospital in Zhejiang province with dirty money to the tune of CNY 2.77 million. Sadly, not a rare moment in the Chinese pharmaceutical industry. Likewise tarnished have been other big-name drug providers had commercial briberies, such as Fosun Pharmaceutical (600196:SH) and Buchang Pharmaceutical (603858:SH), etc.  This commercial bribery problem has been a historical issue, with a root in 'Gold Sales' ('带金销售') – a kind of sale to provide kickbacks to doctors with prescription rights. In the past, the pharmaceutical business was generally sales-oriented, so companies wasted a lot of money on selling expenses instead of investing in innovation. Although this gray area has been known about for years, it has not been eradicated. Now China has escalated healthcare reform to the anti-corruption stage, by introducing a national policy, Centralized Purchasing of Drugs for Public Hospitals ('带量采购'). It is still too early to judge how much it can clean the healthcare industry – several healthcare companies are being cleaned out of the medicine distribution business, such as Yunnan Baiyao (000538:SZ). (See EqualOcean's analysis here) A promising but unexpected market As the competition gets fierce, companies should be more ambitious and eye more niche opportunities along the industry chain – not only to get hold of the current position, build up a more robust advantage moat, but also to diversify idiosyncratic risks. Chinese National Medical Products Administration (NMPA) announced on March 25 that paclitaxel for injection (Albumin Bound) provided by Celgene was banned from importing, sales and use in China. Celgene is a biotechnology company, delisted from Nasdaq on May 4 and merged to Bristol Myers Squibb (BMY:NYSE). Paclitaxel is a core ingredient that kills cancer cells and is widely used in oncological medicines. And the albumin-bound type is the most effective one with global recognition by the Food and Drug Administration (FDA) and the National Comprehensive Cancer Network (NCCN).  Before the ban, there was a triopoly – a situation in the domestic supply of paclitaxel: CSPC Pharmaceutical (1093:HKSE), Hengrui Medicine and BeiGene, who was in strategic cooperation with Celgene. It is very like to see a duopoly market in this cancer killer in a short time. The total market size of paclitaxel in 2019 is between 17 million and 18 million units. According to International Medicine Studies' data, the new centralized procurement has ordered an amount of 136,890 units of albumin-bound type. (100 milligrams per unit). For sure, Chinese pharmaceutical companies have a long way to go. A harsh attitude towards old stains is a must to embrace a more transparent, equal and clean industry environment. 

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Updated 13 hours ago · Tianyancha

DingDang Quick Medicine Set up New E-Commerce in Jiangxi

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Aug 11, 2020 11:04 am · VCBeat

Wallaby Medical in Neuro-intervention Closes Series B+

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Aug 10, 2020 06:44 pm · Tonghuashun

Tibet Rhodiola Pharmaceutical Publishes 1H 2020 Financials

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