Week In Review: Zai Lab Targets $1 Billion Valuation In Planned US IPO

Shanghai's Zai Lab is planning a US IPO that could raise $150 million and value the company at $1 billion, according to knowledgeable sources (see story). The company has already picked Citigroup and JPMorgan Chase as underwriters, though it has not completed a US filing. Zai Lab is led by high-profile Samantha Du, PhD, who previously was responsible for Chi-Med's innovative drug R&D operations. Zai is developing innovative products with an eye toward the China market in oncology, autoimmune and infectious disease areas. The company has in-licensed products from western drug companies, and it started its own drug discovery operations in 2015. 

Hangzhou Just Biotherapeutics (Just China), a company focused on providing affordable biologic drugs, completed a $57 million Series B funding (see story). Just China is developing a portfolio of innovative and biosimilar products. Founded in early 2016 as a joint venture with Just Biotherapeutics (Just) of Seattle, Just China was established with the goal of shortening the development process and reducing the manufacturing cost of biologic drugs. The B round was led by Temasek of Singapore and joined by existing investors Lilly Asia Ventures and ARCH Venture Partners. 

New Horizon Health, a Beijing-Hangzhou company developing early-stage cancer screening products, raised $20 million in a B round led by Qiming Venture Partners (see story). New Horizon's first product is a home-based test for colorectal cancer using fecal gene analysis (FIT-DNA) technology. Horizon believes the test can detect precancerous lesions five years earlier than blood tests. Using a colonoscopy, the lesions can be removed before they become cancerous. Previous investors Legend Capital and SoftBank China also participated in the B round. 

Shanghai Fosun Pharma (SHA: 600196; HK: 2196) is vying with Shanghai Pharma Holding (SHA: 601607) in a battle to acquire a minority stake in Atlanta's Arbor Pharma, according to Bloomberg News (see story). Apparently, US private equity company KKR has put its Arbor stake up for sale, with bids expected in the $600-$700 million range. Arbor makes both generic and patented drugs; it also has an active R&D program with seven candidates in clinical trials and another in pre-clinical development. KKR made an investment of undisclosed size in Arbor in late 2014. 

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