GIC leads $125m round for China cancer diagnostics business

Lyfe Capital, CMB International Capital, Lilly Asia Ventures (LAV), Sequoia Capital China, and T&Brothers Capital also participated. All apart from T&Brothers Capital featured in Burning Rock’s RMB300 million Series B in 2016. A year earlier, Sequoia, Legend Star and Ji Feng Capital contributed RMB150 million through an extended Series A round. The initial tranche of RMB62 million was provided by Legend Star, an incubator under Legend Holdings, and Northern Light Venture Capital.

Founded in 2014, Burning Rock focuses on NGS (next-generation sequencing) diagnostics solutions for oncology. The company is headquartered in Beijing and has a medical laboratory in Guangzhou and an R&D center in Shanghai. It claims to have developed 32 products for different cancer types and clinical applications.

There are three core businesses: cancer patient companion diagnostics, where a test is administered alongside a drug to assess its applicability; early cancer detection; and a cancer genome big data ecosystem. The new funding will support the development of an early cancer detection product and drive growth in the companion diagnostics business.

"Tumor precision medicine is based on precise diagnosis. As more and more new targeted drugs and immunotherapy are available in the market, NGS-based companion diagnostics has become essential for better cancer treatment solutions,” said Yusheng Han, the founder and CEO of Burning Rock, in a statement. He added that the market has seen compound annual growth of more than 100% over the last three years, with rapid expansion set to continue over the next three years.

These numbers have attracted plenty of competitors. NGS and precision medicine involves the analysis of genomes to help doctors develop treatments tailored for unique genetic profiles. Companies usually sell access to their big data ecosystems – enabling drug developers to study how genes function and relate to different diseases – and provide testing services.

BGI and Berry Genomics are the dominant force in China for the most common genetic test, which establishes whether a fetus is afflicted with a disease, working in partnership with thousands of women and children’s hospitals. WuXi NextCode, on the other hand, has received substantial private funding for a strategy that involves tapping mass market consumer demand for personal gene tests that offer a snapshot of an individual’s health, lifestyle, and personality.

Other PE and VC-backed sequencing and testing businesses include 23Mofang, Prenetics, and Annoroad. Annoroad is a NGS specialist much like Burning Rock. Both have partnerships with Illumina, a leading US sequencing player.

Meanwhile, early tumor detection is relatively underdeveloped, but several Chinese start-ups are focusing on the space, perhaps inspired by the success of US-based Grail, an Illumina spin-out that is developing blood-based cancer testing services. Novogene, Amoy Dx, and Geneseeq are among the other local players. BGI spun out its cancer prevention and early detection unit in 2016.

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• Topics
• Greater China
• Healthcare
• Expansion
• China
• Growth capital
• GIC Private
• Lyfe Capital
• Lilly Asia Ventures
• Sequoia Capital