Major Pharma M&A Week: Nanjing Xinbai's Dendreon Acquisition Approved, Shanghai Pharma Acquires 26.34% Stake in Tianpu for RMB 3.475 Billion

Last week (May 21 to May 26), as May drew to a close, numerous Chinese pharmaceutical companies launched high-value M&A transactions: SPH acquired a 26.34% stake in Techpool BIO-PHARMA for RMB 3.475 billion; Hainan Haiyao acquired 100% of Qili Pharmaceutical for over RMB 2.1 billion; Salubris obtained product property rights and partial equity in a Swiss company’s portfolio for nearly RMB 200 million; Nanjing Xinjibai’s acquisition of Dendreon was approved; Amoy Diagnostics proposed an USD 8 million minority investment in UST; and Tonghua Jinma acquired an 84.14% equity stake in each of five hospitals for nearly RMB 2.2 billion.

▌SPH Acquires 26.34% Stake in Techpool for RMB 3.475 Billion

On May 21, Shanghai Pharmaceuticals Holding Co., Ltd. announced that its wholly-owned overseas subsidiary, SPH (Hong Kong) Investment Co., Ltd., had signed a share purchase agreement with Takeda Pharma AG (“Takeda Switzerland”) in Hong Kong. Through negotiations, the two parties finally determined that the value of 100% equity interest in Techpool BIO-PHARMA Co., Ltd. was USD 545 million (approximately RMB 3.475 billion).

Specifically, SPH invested USD 144 million (approximately RMB 915 million) to acquire 100% equity interest in Takeda Chromo Beteiligungs AG, a wholly-owned subsidiary of Takeda in Switzerland, thereby indirectly holding a 26.34% stake in Techpool BIO-PHARMA Co., Ltd. Upon completion of this transaction, the Company’s shareholding in Techpool will increase from 40.80% to approximately 67.14%, achieving absolute controlling interest. DetailsClick:Takeda Exits! SPH Acquires 26.34% Stake in Techpool for RMB 915 Million, Achieving Absolute Control!

▌Hainan Haiyao Acquires 100% Stake in Qili Pharmaceutical for Over RMB 2.1 Billion

On the evening of May 21, Hainan Haiyao disclosed a plan for a major asset acquisition, under which the company intends to acquire 100% of the shares of Haikou Qili Pharmaceutical Co., Ltd. (hereinafter referred to as "Qili Pharmaceutical") for RMB 2.142 billion in cash. Qili Pharmaceutical’s product portfolio covers antibiotics, cardiovascular drugs, and digestive system medications. The company reported revenue of RMB 1.201 billion and net profit of RMB 105 million last year. Based on the final valuation, the target company carries a premium of 255%, and the counterparties have made no performance commitments.

▌Salubris Acquires Product IP and Partial Equity Stake in Swiss Company for Nearly RMB 200 Million

On the evening of May 21, Salubris announced its intention to enter into an agreement with the Swiss company M.A.MED ALLIANCE SA (the “Target Company”) to acquire, for $10 million in self-owned funds, the exclusive licensing rights in mainland China to the intellectual property and technical information related to the Target Company’s sirolimus-eluting balloon catheter, Selution™. This product is primarily indicated for the treatment of coronary artery disease or peripheral arterial disease, among other conditions. Additionally, Salubris’ wholly-owned subsidiary, Nuotai International Limited, intends to subscribe for 44,790 newly issued ordinary shares at a cost of $20 million in self-owned funds. Upon completion of the subscription, Nuotai will hold a 16.67% equity stake in the Target Company, thereby becoming a shareholder.

▌Jiaying Pharmaceutical Plans to Acquire 99.70% Equity Stake in Dechangxiang

On the evening of May 21, Jiaying Pharmaceutical announced that it had signed a strategic framework agreement with Guiyang Dechangxiang Pharmaceutical Co., Ltd. The two parties intend to carry out comprehensive business cooperation in areas such as drug research and development, marketing, and sales in the future. Meanwhile, the company plans to acquire a 99.70% equity stake in Dechangxiang through private share issuance and cash payments. The company's stock resumed trading on May 22, with the restructuring process continuing; however, its share price hit the daily limit down for three consecutive trading days following the resumption.

▌The Largest Pharmaceutical Merger and Acquisition Between China and the United States,Nanjing Xinjibai's Acquisition of Dendreon Approved!

On the evening of May 23, Nanjing Xinjiekou Department Store Co., Ltd. announced that its issuance of shares to acquire Shiding Hong Kong and raise matching funds had been approved by the Mergers and Acquisitions Restructuring Review Committee of the China Securities Regulatory Commission (CSRC).

Nanjing Xinjiekou Department Store Co., Ltd. previously announced a plan to acquire Dendreon by issuing new shares to its controlling shareholder, Sanpower Group, to purchase the 100% equity interest in Worldbest Biotechnology (Hong Kong) Co., Ltd. held by the latter, and to raise matching funds. The transaction value of the target assets was set at RMB 5.968 billion. Meanwhile, Nanjing Xinjiekou Department Store would issue 180 million shares to Sanpower Group at a price of RMB 33.11 per share.

It is reported that the primary operating asset of Shiding Hong Kong is the 100% equity interest in the U.S. biopharmaceutical company Dendreon. Dendreon’s core product, Provenge, is the first cell-based immunotherapy drug approved by the U.S. Food and Drug Administration (FDA) for marketing, and currently remains the only cell-based immunotherapy drug for the treatment of prostate cancer. Upon completion of the acquisition, Nanjing Xinjiekou Department Store will become the first A-share listed company to own a cell-based immunotherapy drug approved by the U.S. FDA.

▌AmoyDx Proposes to Invest $8 Million for a Stake in UST

On the evening of May 23, AmoyDx announced that it intends to enter into a "Series A Preferred Stock Purchase Agreement" with Universal Sequencing Technology Corporation. The company plans to use $8 million of its own funds to purchase 1,509,595 preferred shares issued by UST, at a purchase price of approximately $5.30 per share. Upon completion of the transaction, this will account for 18.986% of the total number of issued shares of UST.

It is understood that UST Company is a high-tech biotechnology enterprise specializing in the research and development and industrialization of gene sequencing platforms. Currently, UST Company is still in the stage of R&D and industrialization promotion, with its related products not yet achieving mass production or external sales. Since its inception, Amoy Diagnostics has been committed to researching, developing, and manufacturing genetic testing system solutions/series of products that comply with national laws and industry standards and serve precision oncology medicine, so as to meet the clinical testing needs of cancer patients. This capital increase and equity investment in UST Company is made in consideration of the company’s long-term development strategy. It is conducive to strengthening cooperation with innovative enterprises possessing technological advantages overseas, further improving the company’s industrial layout, expanding its business scope, and enhancing its core competitiveness and sustainable development capabilities.

▌Tonghua Jinma Acquires 84.14% Equity Stake in Five Hospitals for Nearly RMB 2.2 Billion

On May 23, Tonghua Jinma released an acquisition report, proposing to acquire 84.14% equity stakes in Qimei Hospital, Shuangkuang Hospital, Jikuang Hospital, Hekuang Hospital, and Hekang Oncology Hospital respectively through share issuance and cash payments, with a total valuation of nearly RMB 2.191 billion. Of this amount, RMB 1.5 billion will be paid in cash, and RMB 690 million in shares. Meanwhile, the company plans a private placement to raise matching funds not exceeding RMB 690 million, which will be used to cover the cash consideration and various expenses related to this transaction. Upon completion of the acquisition, Tonghua Jinma will gain controlling interests in these five hospitals located in several coal-mining cities in Heilongjiang Province, thereby adding a new hospital operations segment to its business portfolio.

Prior to the transaction, Qimei Group, Shuangkuang Group, Jikuang Group, and Hekuang Group each held a 15% equity interest in the target hospital. These four groups are wholly-owned subsidiaries of Longmei Group. Following the sale of their equity interests in the hospital, these four regional coal mining groups will also exit from the aforementioned target hospital.

▌Huahai Pharmaceutical Plans Private Placement to Raise No More Than RMB 1.8 Billion

On the evening of May 25, Huahai Pharmaceutical announced that, after comprehensive consideration of various factors including the overall environment of the capital market and the company’s actual situation, it has decided to terminate the public issuance of convertible corporate bonds. The company intends to meet its funding needs for development through other financing methods. Meanwhile, the company released a private placement plan, proposing to issue no more than 250 million shares, with a maximum fundraising amount of RMB 1.8 billion. The proceeds will be primarily used for the construction of the biopharmaceutical park and R&D center, the intelligent manufacturing system integration project, and supplementary working capital.

(Translational Medicine Network 360zhyx.com)