Hongyun Biologics Secures Nearly RMB 100 Million in Series B+ Financing to Advance Global Development of Oncology Drugs Based on Structural Pharmacology Platform, Advised by WinX Capital

May 2023,RedCloudBio Co., Ltd. (hereinafter referred to as "RedCloudBio") announced the completion of a nearly RMB 100 million Series B+ financing round, led jointly by TusPark Ventures and Taizhou Huayin Jintou, with participation from Shanghai Renjin Investment Management Center (L.P.) and Taizhou Angel Fund. Existing shareholder Sherpa Healthcare Partners continued its support. VCBeat Capital served as the exclusive financial advisor for this round. The proceeds will help RedCloudBio conduct clinical trials of the next-generation EGFR inhibitor H002 in non-small cell lung cancer patients simultaneously in China and the United States, while accelerating the development of its pipeline and technology based on its unique structural pharmacology platform.

RedCloudBio is a clinical-stage small molecule innovative drug discovery company that centers on structural pharmacology and integrates cutting-edge computational technologies such as molecular dynamics simulation, computational chemistry, and artificial intelligence (AI). RedCloudBio has accumulated unique structural biology data and algorithmic models in multiple target areas oriented toward clinical needs. It has also established several pipelines for the precise development of small molecule drugs, covering treatment areas including oncology, rare diseases, and other fields with highly unmet clinical needs. Currently, H002, a novel small molecule drug independently developed by the company, is undergoing Phase I clinical trials in both China and the United States and is expected to become the optimal choice for the next generation of EGFR-TKI inhibitors. Meanwhile, a first-in-class target project for breast cancer and various other tumors has reached the PCC stage and is anticipated to file for clinical trials in 2024.

For this round of financing,Dr. Maijing Liao, CEO of RedCloudBioRedCloudBio stated that over the past year, it has grown from an early-stage R&D company with industry-leading innovative concepts into a clinical-stage R&D enterprise with a global perspective. We are deeply grateful for the continuous recognition and unwavering support from our investors, as well as the experts and partner institutions involved in our clinical trial programs. RedCloudBio will continue to attract top talents in the industry, focus on patients and clinical needs, integrate various new technological approaches, and develop the best innovative targeted drugs based on insights into protein dynamic structures. Guided by a global mindset, we will actively advance clinical development and cooperation.

Qiu Qing, Managing Director of TusPark VenturesWe are very pleased to participate in this round of financing for RedCloudBio. RedCloudBio has an efficient execution team that combines research and industrial backgrounds. The company uses structural pharmacology as its core technology, based on the complex structures of measured candidate molecules and targets, combined with computational methods to understand the dynamic structure of drugs and targets for drug design optimization—a frontier technology field worth investing in. The R&D data for the new generation of EGFR inhibitors developed on this technical platform is detailed and encouraging. We look forward to the company’s products providing safer and more effective solutions to meet the urgent need for clinical third-generation EGFR inhibitor resistance, benefiting more patients.

Yang Miao, Chairman of Taizhou Huayin JintouRedCloudBio Co., Ltd. has a leading new drug design platform based on structural pharmacology, which precisely grasps the structure and function of target proteins and their mutants at atomic resolution. It is supported by artificial intelligence, molecular dynamics simulation, and computational chemistry to empower hit compound discovery and lead compound optimization technology. This allows them to tackle drug-resistant targets and novel targets with significant clinical potential. We have high expectations for the future development of RedCloudBio.

Liang Jianping, Executive Partner of Shanghai Renjin Investment Management Center (L.P.)RedCloudBio's next-generation EGFR inhibitor H002, designed with a unique mechanism, has overcome the challenge of balancing target activity and selectivity previously encountered in the development of this target. It has demonstrated efficacy against various EGFR mutations, including osimertinib-resistant mutations, second-generation mutations, and first-generation mutations. H002 not only addresses issues faced by patients with drug resistance but also shows great market potential as a first-line treatment for non-resistant patients. We look forward to the product’s early approval and market launch.

Zhang Xiaoyan, Partner of Taizhou Angel FundRepresentatives stated that RedCloudBio is the first biopharmaceutical project in our investment portfolio. We have high expectations for RedCloudBio's team and technology platform. In particular, the H002 product is the result of many years of research by the RedCloudBio team and has demonstrated significant inhibitory effects on various single mutants, double mutants, and triple mutants in both cellular and animal model experiments. Preclinical trial results also indicate that H002 has good bioavailability, tissue distribution, and a therapeutic window. Early clinical data further shows promising efficacy and safety for H002. We look forward to the disclosure of more product data.

Sherpa Healthcare Partners Partner, Vince XingWe continue to be optimistic about RedCloudBio's technology platform and innovative pipeline, especially the clinical data of H002, which has made us even more excited. This also fully demonstrates the increasing maturity of RedCloudBio’s technology platform and the team's deep understanding of targets and clinical translation. We have great confidence in the company's future development.

Dr. Liu Yuheng, Partner of WinX CapitalIt is a great honor to assist RedCloudBio in completing this round of financing. Despite the capital winter in the pharmaceuticals and biotech industry since last year, several significant events underscore the importance of structure-based pharmacology in drug development as the pinnacle of small molecule innovative drug research: Ventus Therapeutics securing over $100 million in funding, and Takeda Pharmaceutical paying $4 billion upfront to Nimbus Therapeutics for the introduction of a TYK2 inhibitor. RedCloudBio, leveraging its extensive "hands-on experience," has refined a platform that includes structural pharmacology, protein dynamic simulation, ultra-high throughput screening, and a novel AI technology platform, leading to the discovery of drug molecules. This demonstrates that the company has positioned itself at the forefront of this field globally. We deeply appreciate the trust RedCloudBio has placed in WinX Capital, and we hope RedCloudBio accelerates the advancement of its R&D pipeline to benefit patients as soon as possible.

TusPark Ventures was reorganized and established in 2014 under the strategic background of Tsinghua University’s promotion of technology transfer. It is a professional investment management institution primarily focused on early-stage investments in science and technology innovation enterprises. TusPark Ventures concentrates on key fields such as life sciences, medical devices, information technology, and modern manufacturing. It has long been dedicated to investing in innovative enterprises with core hard technologies, while also specializing in incubating investments derived from scientific and technological achievements by university and top-tier hospital clinical experts. Currently, TusPark Ventures manages funds exceeding 3 billion yuan, with over 70 accumulated investment projects. Two-thirds of these projects hold dominant positions in niche markets, and more than half are domestic or even international firsts in technology. This has generated favorable financial returns for fund investors and earned the firm a spot on the "Class A Private Equity Fund Managers for Insurance Capital Investment" whitelist released by the China Insurance Asset Management Association.

Huayin Financial Investment Co., Ltd. of Taizhou Medical High-tech Zone (hereinafter referred to as "Huayin Financial Investment") is a state-owned financial investment enterprise in Taizhou Medical High-tech Zone (Gaogang District), with a registered capital of 5 billion yuan. The company is mainly engaged in financial businesses such as equity investment, debt financing, capital operation and asset management, credit guarantee and re-guarantee, and oversees business sectors including fund investment, technology-based microfinance, financing guarantee, financial leasing, commercial factoring, and pawnbroking.

Over the years, Huayin Jintou has relied on the industrial advantages of the pharmaceutical high-tech zone (Gaogang District) to vigorously develop direct investment funds. It has established a number of direct investment funds such as angel, VC, and PE, with a total fund investment scale of nearly 5 billion yuan, generating significant economic and social benefits. At the same time, it has actively developed a large health fund of funds and an industry-guiding fund of funds. Collaborating with Everbright Holdings, China Merchants Capital, and Shanghai Renjin Investment Management Center(L.P.), it has initiated and set up more than 10 cooperative funds. Further committed to partnering with excellent investment fund management institutions, it aims to create an equity investment cluster zone to support the rapid development of local enterprises.

In the future, Huayin Jintou will continue to gather advantageous resources, create a high-quality business environment, and contribute financial strength to support the industrial development of Taizhou Medical High-tech Zone (Gaogang District).

Shanghai Renjin Investment Management Center (L.P.), established in 2013, is an equity investment fund manager registered with the Asset Management Association of China. Renjin Investment focuses on the large health industry while also investing in TMT, environmental protection, new energy, and high-end equipment manufacturing sectors. Its investment activities span the entire industrial chain, from angel investments to VC, from PE to mergers and acquisitions. Currently, all invested projects have yielded positive returns and successfully achieved industrial implementation. Renjin Investment boasts several senior investment experts with experience across both primary and secondary markets, as well as a young, dynamic executive team with overseas education backgrounds. The company is united in its efforts to deeply cultivate niche sectors, actively building an investment ecosystem platform for the large health industry, and is committed to becoming a boutique industrial investment institution with influence across China and even globally.

Taizhou Angel Fund is an early-stage science and technology investment fund operated in a market-oriented manner, focusing on policy-driven direct investments in life sciences, new energy, advanced manufacturing, and other fields. The Angel Fund was initiated by the Taizhou Science and Technology Bureau, leveraging regional industrial advantages to empower innovation and entrepreneurship while driving industrial upgrading.

Little Table Venture Capital is the manager of an angel fund, established through a collaboration between China's largest entrepreneur community, Little Table, and a well-known domestic financial services group. The investment team has extensive early-stage investment experience and actively seeks out and covers disruptive technological innovations, leveraging an ecosystem combined with capital and a long-term mindset to support more success stories.

Sherpa Investment is a professional fund focused on early-stage healthcare investments, adhering to the investment philosophy of building an industry ecosystem. Based on an in-depth understanding of major disease treatment areas, it constructs a portfolio targeting unmet medical needs, extending its reach along the industry's vertical and upstream/downstream sectors. By actively sharing operational experience and forward-looking perspectives across the entire industry chain with invested companies, the team proactively promotes internal and external collaboration, helping businesses achieve rapid growth in both operating performance and value, and securing leading positions in niche markets. The firm has invested in leading enterprises within sub-sectors such as pharmaceuticals, gene technology, medical devices, healthcare services, and upstream/downstream tools, forming comprehensive resource advantages in project sourcing, post-investment value-added services, and exit strategies. From 2011 to 2023, through five fund cycles and over 160 healthcare projects, Sherpa has had the privilege of partnering with many outstanding entrepreneurs, growing together.

WinX Capital is a leading investment bank in China's healthcare sector, headquartered in Beijing and Shanghai, covering over 3,000 active investment institutions and industry groups. It has been awarded "Top 1 Financial Advisor in the Medical and Health Field in 2022" by First New Voice, "Top 2 Best Financial Advisor in the Medical and Health Field for 2021-2022" by Qiming and New Voice Creative Service, "Top 5 Annual Healthcare Financial Advisor of the 2022-2023 Pengcheng Award" by VCBeat, among many other honors.