General Atlantic invests $100m in Chinese drug maker
General Atlantic has invested $100 million in NASDAQ-listed Chinese cancer drug developer Hutchison China MediTech - also known as Chi-Med - a subsidiary of Hong Kong conglomerate CK Hutchison Holdings.
The private equity firm subscribed to four million American Depository Shares (ADS) priced at $25 apiece, a 10.4% premium to the 30-day volume-weighted average, according to a filing. It has also been granted a warrant to purchase an additional 3.33 million shares at $30 apiece within 18 months, which would take the overall commitment to $200 million.
The proceeds will fund ongoing research and clinical development and support the growth of Chi-Med’s commercialization capabilities in China and globally. Chi-Med's stock closed up 4.44% at $26.11 on June 25 in response to the announcement.
Founded in 2000, the company focuses on targeted therapies and immunotherapies for the treatment of cancer and immunological diseases. It has a portfolio of eight cancer drug candidates in clinical studies around the world. Three treatments targeting colorectal cancer and neuroendocrine tumors have been designated for fast track approval by the US Food & Drug Administration. Another neuroendocrine tumor treatment will make a new new drug application in the US later this year.
“We believe Chi-Med is a pioneer of the Chinese biotech market in bringing advanced oncology therapies to the world,” said Lefei Sun, head of healthcare for China at General Atlantic, in a statement.
The private equity firm formally launched its healthcare and life sciences business in China two years ago. Earlier this year, it led a Series D round for Adagene, a Chinese drug developer with one cancer treatment in phase one clinical trials in China and the US. General Atlantic also participated in a funding round for CANbridge Pharmaceuticals, another cancer drug developer.
Chi-Med generated $204.9 million in revenue last year, down from $214.1 million in 2018. Over the same period, its net loss widened from $74.8 million to $106 million.
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