CDH leads round for Chinese DNA-based drug developer

The private equity firm committed capital from its debut mid-market fund, which closed early last year at $800 million, comprising $300 million in US dollars and $500 million in renminbi. Leadyond Capital, a GP established in 2007 by one of the founders of Legend Capital and Hony Capital, also took part in the round.

Founded in 2013 by Jin Li, who previously worked for AstraZeneca, HitGen focuses on DNA-encoded libraries (DELs). The company combines molecular biology, chemical synthesis, high throughput sequencing, and advanced information processing to create huge collections of molecules. Every molecular compound is encoded with a DNA sequence.

This is followed by a screening process whereby a target protein is incubated with different DELs to see whether any compounds bind with the protein. Those that do could potentially be used in drug development. DEL technology serves to accelerate the discovery process, especially in early-stage activities such as target validation and hit identification.

HitGen has more than 900 DELs with over 200 billion novel small molecules, said to be one of the largest and most diverse collections in the world. It has formed partnerships with the likes of Johnson & Johnson, Pfizer, Merck, Takeda, and BASF.

HitGen's own drug portfolio includes nine treatments, of which five are focused on cancer. One has filed a new drug application, three are in the preclinical study stage, and the rest are less mature. The new capital will go towards speeding up these development programs as well as expanding and improving the company's technology platform.

"We believe that HitGen, with its unique business model, is not only a service provider in early-stage drug development but also has the potential to become a drug-development company with capability to generate batches of original new drugs," Lily Zhang, a partner with CDH's venture and growth capital team, said in a statement.

Lin Wang (pictured, right, with HitGen's Li), a founding partner of the private equity firm, added that biotech innovation has entered a "golden stage" in China, supported by returnees such as Li and government policies intended to speed up drug approval. He expects moves to permit zero-revenue biotech companies to list in Hong Kong will attract more capital into the space and accelerate R&D.

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• Topics
• Greater China
• Early-stage
• Healthcare
• Technology
• China
• CDH Investments Management