Chongqing-based Biotech Chen'an Pharma Acquired by Zhifei Biological for RMB 593 Million to Expand into Metabolic Disease Therapeutics

On the evening of March 21, Zhifei Biological issued an announcement stating that it had signed the "Capital Increase and Share Expansion Agreement Regarding Chongqing Chen'an Biological Pharmaceutical Co., Ltd." with Chen'an Biological, Zhirui Investment, and Zhang Gaoxia. Zhifei Biological will inject RMB 593 million in cash into Chen'an Biological to acquire a 51% equity stake in the company.

As early as November 2023, Zhifei Biological issued an announcement stating its intention to acquire equity in Chen'an Biology with cash and signed an "Intentional Agreement for Equity Acquisition." The latest announcement signifies the formal completion of this transaction. Upon the completion of this capital increase, Chen'an Biology will become a holding subsidiary of the company. Through this transaction, Zhifei Biological will extend its business scope to cover metabolic diseases such as diabetes and obesity, and will also enter the field of therapeutic biologics.

Chen’an Biopharma was established in 2015 as a joint venture by Zhirui Investment and Zhang Gaoxia. Zhirui Investment contributed RMB 85 million, accounting for 85% of the registered capital, while Zhang Gaoxia contributed RMB 15 million, representing 15% of the registered capital. Zhirui Investment itself was jointly founded by Jiang Rensheng (Chairman of Zhifei Biological) and Chongqing Zhifei Biological Products Co., Ltd. Jiang Rensheng contributed RMB 90 million, holding a 90% equity stake, and Chongqing Zhifei Biological Products Co., Ltd. contributed RMB 10 million, holding a 10% equity stake.

Therefore, even without an acquisition, Chen'an Biopharma remains a key asset of Jiang Rensheng, the chairman of Zhifei Biologicals, bearing strong “Zhifei elements.” With its recent acquisition and formal integration as a subsidiary of Chongqing Zhifei Biological Products Co., Ltd., this move not only maximizes the interests of both companies but also indirectly demonstrates Zhifei Biologicals’ recognition of Chen'an Biopharma.

ChenAn Biologics is an innovative biopharmaceutical company driven by independent R&D and built upon a recombinant protein technology platform. The company has established a platform for the application of scientific research achievements and their industrial translation, and has mastered technologies for constructing high-expression recombinant protein strains. By directionally engineering yeast and Escherichia coli expression systems, it can achieve high-density fermentation and expression of recombinant human insulin and GLP-1 analog precursor proteins. Due to the high level of protein expression, impurities can be effectively controlled during subsequent purification processes, thereby reducing overall production costs. As a result, ChenAn Biologics holds certain technological advantages among domestic biopharmaceutical companies in China.

ChenAn Bio focuses on metabolic diseases such as diabetes and obesity, with a research and development pipeline centered on GLP-1 analogs and insulin analogs. As of December 31, 2024, ChenAn Bio’s total investment in its R&D pipeline had reached nearly RMB 700 million. Supported by sustained R&D funding, the company has established a portfolio of more than ten ongoing projects, including: (1) Liraglutide Injection, which is at the stage of filing for marketing approval; (2) two candidate drugs—Semaglutide Injection (for glycemic control) and Insulin Degludec Injection—that have completed Phase III clinical trials; (3) two candidate drugs—Semaglutide Injection (for weight management) and Insulin Degludec/Insulin Aspart Injection—that are currently in Phase III clinical trials; and (4) nearly ten additional pipeline candidates in preclinical research, such as a dual GLP-1/GIP receptor agonist and oral Semaglutide tablets.

Key Clinical-Stage Pipeline Projects of ChenAn Biologics, Source: Zhifei Biological Products Announcement

It is evident that Chenan Biologics has multiple pipeline products nearing maturity. In China, once Novo Nordisk’s semaglutide patent expires in 2026, Chenan Biologics, as a company with several candidates in Phase III clinical trials for metabolic diseases, is poised to become a key competitor in this sector. Furthermore, upon successful approval of its products, and leveraging Chongqing Zhifei Biological Products Co., Ltd.’s mature and extensive commercialization infrastructure and resources, Chenan Biologics’ path to market will accelerate significantly, potentially reshaping the landscape of the domestic metabolic disease sector.

In response, Chenan Biologics has long been prepared to compete for the coveted title of “Blockbuster Drug King.” The company has established an industrial base capable of supporting product development and large-scale manufacturing, comprising one formulation workshop and three active pharmaceutical ingredient (API) workshops, with an annual production capacity of 30 million finished dosage units. Through this transaction, Zhifei Biologics will integrate Chenan Biologics into its portfolio, expanding its business from vaccines into the field of metabolic diseases and, on this basis, entering the therapeutic biopharmaceutical sector.

Zhifei Biological was established in 2002, with its core business focused on preventive vaccines. In September 2010, Zhifei Biological was listed on the Shenzhen Stock Exchange (Stock Code: 300122), becoming the first private vaccine enterprise to be listed on the ChiNext board. It has since grown into a leading company in China’s private vaccine industry. As a “top-tier” player in China’s vaccine sector, Zhifei Biological has remained dedicated to the field of biopharmaceuticals since its inception, targeting common and frequently occurring diseases with high incidence rates and severe health impacts.

In the field of prevention,Zhifei Biologicals has 33 independent R&D projects in its pipeline. Among them, the 15-valent pneumococcal conjugate vaccine has obtained the Phase III clinical trial summary report, with no equivalent product currently approved for market launch in China; the 26-valent pneumococcal conjugate vaccine has entered Phase I/II clinical trials, representing the highest-valency product among similar candidates currently in clinical trials in China; the quadrivalent recombinant norovirus vaccine has entered Phase III clinical trials, making it the fastest-moving product at this valency level; and the bivalent conjugate vaccine against Shigella flexneri and Shigella sonnei is currently in Phase III clinical development, being the first vaccine globally developed to simultaneously prevent infections caused by both S. flexneri and S. sonnei.

In the field of treatment,Zhifei Biologicals has leveraged its Zhirui Investment platform to deploy equity investments in the broader healthcare sector, primarily targeting oncology, metabolic disorders, cardiovascular diseases, autoimmune diseases, and neurodegenerative diseases. To this end, it established the Zhirui Biopharmaceutical Industrial Park in Banan District, Chongqing. The park occupies a net land area of 1,100 mu and has attracted cumulative investment and financing exceeding RMB 12 billion. After a decade of development, companies incubated by Zhirui Investment, such as Zhixiang Jintai and Chen’an Biologics, have entered their harvest phase. As mentioned above, Chen’an Biologics, which is now controlled through a capital increase, is also an enterprise incubated by Zhirui Investment.

In fact, as any enterprise reaches a certain scale, it will pursue horizontal and vertical development and transformation to balance development risks and raise its growth ceiling. This transaction represents one of Zhifei Biological’s strategic steps toward future sustainable development, enhancing corporate innovation capabilities, and building new-quality productive forces, thereby laying a foundation for the company’s long-term and steady growth. As Chen’an Bio’s R&D pipeline advances steadily and gradually achieves commercialization, revenue from therapeutic biologics is expected to become a key growth driver for Zhifei Biological’s future performance, making this capital increase necessary.

As one of the leading enterprises in China’s vaccine industry, Chongqing Zhifei Biological Products Co., Ltd. has achieved remarkable success in the vaccine sector by leveraging its robust R&D capabilities, diverse product portfolio, and efficient market expansion strategies. We also look forward to this “top-tier” vaccine player achieving breakthroughs in both prevention and treatment, scaling new heights on its fresh journey.