Shenzhou Bio Raises Over RMB 200 Million in Series A1 Funding to Advance iPSC-Derived Therapies for Neurological Disorders

On November 8, 2022, focusing on the R&D and industrialization of iPS cell-derived therapeuticsXsellSmart Biopharmaceuticals (Suzhou) Co., Ltd.(hereinafter referred to as“XsellSmart”）Officially Announces Completion of Over RMB 200 MillionA1 Round Financing. This round of financing was led byQiming Venture Partners, Lilly Asia Ventures, Jinyuan Zhanhong, and Zhongxin Capital jointly led the investment; Oriza Holdings, Peking University Technology Transfer Fund (Founder H Fund), and Junshan Capital participated as co-investors; FreeS Fund, HongShan, and Jiacheng CapitalPending further investment. This round of financing will be used to accelerate the advancement of XsellSmartPreclinical R&D of XsellSmart’s iPS cell-derived therapeutic pipeline for neurological diseases, expansion of the professional team, and trial production of clinical-grade iPS cell-derived therapeutic products.

Dr. Li Xiang, Founder of XsellSmart, has dedicated over a decade to the development of iPSC-derived cell therapies, having previously held positions at renowned domestic and international laboratories specializing in iPSC reprogramming and directed differentiation, as well as at leading global companies in the field.XsellSmart was founded in early 2021 by Dr. Li Xiang as a full-time venture upon his return to China., is a Chinese biopharmaceutical company dedicated to providing scalable, low-cost therapeutic solutions based on iPS cell-derived pharmaceuticals for a range of major or critical diseases that currently lack substantial clinical solutions, with Parkinson’s disease as a representative example.“Bringing unparalleled stem cell innovative drugs to benefit millions of suffering patient families” is the long-term vision of XsellSmart.

Since its establishment, under the comprehensive leadership of Dr. Li Xiang:

XsellSmart has assembled a full-time professional team of over 100 members, including 17 PhDs and postdoctoral researchers. The core team hails from prestigious domestic and international institutions such as Peking University, Tsinghua University, Fudan University, Shanghai Jiao Tong University, Tongji University, the Chinese Academy of Sciences, the University of Wisconsin–Madison, Johns Hopkins University, and the University of California, as well as from renowned companies in the cell therapy industry. The team possesses cutting-edge stem cell therapy technologies and translational experience at the forefront of both international research and industry applications.

XsellSmart has completed the construction of key technology platforms, including iPSC line reprogramming, iPSC gene editing, and directed differentiation of iPSCs into various cell subtypes; established animal models for evaluating the safety and efficacy of cell-based therapies; and developed a robust patent system for its core technologies.

XsellSmart independently designed and constructed a 1,800-square-meter R&D center (2021) and a GMP pilot-scale manufacturing workshop and quality control center spanning several thousand square meters (2022);

XsellSmart has collaborated with numerous renowned universities, institutions, and Grade A tertiary hospitals on related technologies and early-stage clinical development, and serves as a member unit of the Cell and Gene Therapy Product Regulatory Research Committee under the China Association for Drug Administration Research.

XsellSmart has been honored with numerous awards and industry recognitions, including being named one of the “Top 10 Most Promising Innovative Therapy Companies” on the 2022 China Biopharmaceutical Industry Value List, listed among the “Top 50 Most Innovative Biopharmaceutical Companies in China” in 2021, recognized as the “Most Promising Innovative Company” at the 2021 Golden Award Ceremony, awarded the Highest Honor for Cell Therapy in China at the 2021 Zhangjiang International Cell Industry Summit, and receiving the 2021 BioBay Growth Award from Suzhou Industrial Park.

XsellSmart has made significant progress in its lead pipeline for treating Parkinson’s disease with iPSC-derived dopaminergic neural precursor cells, as well as in the development of next-generation universal pluripotent stem cells:

Leveraging XsellSmart’s proprietary next-generation differentiation process, the induction culture system and its components are significantly simplified compared to traditional methods. This approach substantially shortens induction time and reduces production costs, enabling the preparation of high-purity, subtype-specific dopaminergic neural progenitor cells. The relevant quality standards reach an internationally advanced level. The product has been evaluated and validated in various preclinical animal models, demonstrating excellent druggability. Key platform technology patents have been secured, with the core pipeline expected to enter clinical stages in 2023–2024. XsellSmart’s project, “Treatment of Major Neurological Diseases Using Subtype-Specific Neurons and Glial Cells Derived from Universal Pluripotent Stem Cells,” received the highest award (Excellence Award) at the finals of the National Disruptive Technology Innovation Competition organized by the Ministry of Science and Technology of China, and was certified and included in the national database by the Ministry.

Dr. Li Xiang, Founder of XsellSmart

XsellSmart Successfully Completes Over RMB 200 Million in Series A1 Financing, XsLi Xiang, Founder, Chairman, CEO & CSO of XsellSmartstated: “This round of financing represents XsellSmart’s triumph amidst the broader chill in the biopharmaceutical sector. Adversity and headwinds help the industry reflect calmly, iterate, and return to rationality, significantly raising the threshold for investment and financing while promoting the selective concentration of resources among leading players, which is beneficial to the orderly and healthy long-term development of the industry.”

We extend our gratitude to the cohort of new and existing professional investment institutions in this round for their discerning recognition and support of XsellSmart’s innovation, execution capabilities, progress in core business operations, and growth potential, as well as for their long-term alignment with our values and confidence in XsellSmart and the field of innovative iPS cell-derived therapeutics in China.

The XsellSmart team is deeply aware that behind every new drug development effort lie the vibrant lives of millions of patient families and their last hopes for changing their destinies. We must go all in, revere life, and endure rigorous refinement to achieve excellence. Only by deeply committing to product quality and clinical value, continuously evolving and proving our practical industrialization capabilities and execution strength, can we navigate the cyclical shifts of the industry and ultimately “benefit millions of suffering patient families with unparalleled, state-level innovative stem cell therapies.”

Hong Feng, General Manager of Jinyuan Equity, Co-Lead Investor in XsellSmart’s Series A1 Financing Round“He stated, ‘Parkinson’s disease, a chronic degenerative disorder of the central nervous system, has remained without a cure for many years; cell therapy holds promise as a breakthrough solution. In recent years, significant progress has been made in induced pluripotent stem cells (iPSCs), spanning basic research, chemistry, manufacturing, and controls (CMC), national policy regulation, and clinical standards. XsellSmart is undoubtedly a leading company at the forefront of this field. Dr. Li Xiang brings extensive academic and industrial experience in stem cells and regenerative medicine. His hands-on approach and dedicated work ethic will ultimately guide the XsellSmart team to overcome challenges and benefit patients.’”

Tian Xueling, Chairman of Zhongxin Industrial Investment & Zhongxin Capital under China-Singapore Group, Co-led XsellSmart’s Series A1 Financing Round“It was stated: ‘Induced pluripotent stem cells (iPSCs) represent an innovative technology in the biomedical field. As a versatile cell technology honored with the Nobel Prize, iPSCs hold immense application value in areas such as cell therapy, regenerative medicine, disease modeling, and drug development, with their promising prospects widely recognized both domestically and internationally. XsellSmart is one of the leading enterprises in China’s iPSC industry, boasting profound technological expertise, an excellent team, and strong execution capabilities. Zhongxin Capital is delighted to participate in this financing round and looks forward to working closely with the team, providing long-term support to accelerate the clinical application of iPSC technology and benefit society.’”

Head of Oriza Holdings, Co-Lead Investor in XsellSmart's Series A1 Financing RoundIt stated, “As the second most prevalent neurodegenerative disease, Parkinson’s disease currently has mainstream pharmacological therapies that can only alleviate symptoms but cannot halt disease progression. XsellSmart utilizes iPSC-induced differentiation technology to generate specific neuronal subtypes. Following transplantation, these cells are expected to replace dopamine neurons lost in Parkinson’s disease, offering a potential treatment option for patients with moderate to severe Parkinson’s. We look forward to the early clinical translation of XsellSmart’s products to benefit a broad patient population.”

XsellSmart’s A1 Round Co-Investors: Peking University Technology Transfer Fund and Mr. Mu Jingrui, Managing Director of Founder H Fund“He stated: ‘Diseases of the central nervous system represent one of the steep peaks that human medical research has yet to fully conquer. The application of iPSC technology in this field holds great promise for addressing many of the current challenges faced in treating degenerative disorders. The core team at XsellSmart has accumulated years of specialized technical expertise in the iPSC domain and has achieved highly encouraging and significant progress in the development of iPSC-based therapies for Parkinson’s disease. The Peking University Technology Transfer Fund, managed by Founder H Fund, has consistently adhered to the principles of long-term patience and a focus on high-end hard technologies. Our participation in this investment in a leading sci-tech innovation project led by Peking University alumni aligns perfectly with the fund’s investment strategy and preferences. We hereby wish XsellSmart continued success in scaling new technological heights, bringing benefits to countless patients, and achieving its own milestones.’”

XsellSmart’s Series A1 Financing: Ms. You Sitong, Partner at Junshan Private Equity Fund of Funds, a Co-Investing Institutionstated: “We have consistently maintained a close watch on the iPS cell field and highly recognize the work of Dr. Li Xiang’s team in the area of neurological diseases, with multiple products in their pipeline achieving breakthrough progress. Junshan Capital will continue to provide strong support for the company’s development. We hope that XsellSmart’s products will be applied in clinical settings soon, bringing benefits to patients and making greater contributions to the industry’s advancement.”

FreeS Fund was established in 2015 and has grown into a full-chain fund management company driven by early-stage investments, while actively positioning itself in growth-stage and late-stage ventures. Focusing on three major sectors—Consumer and TMT, Hard Tech, and Biopharmaceuticals—FreeS Fund has invested in over 150 innovative enterprises, covering areas such as lifestyle, culture and entertainment, intelligent manufacturing, artificial intelligence, biotechnology and new drug R&D, new energy, and new materials. Research-driven and innovation-encouraging, FreeS Fund has developed its own systematic investment strategy through continuous exploration: seeking unique investment opportunities at the intersection of disciplines. We believe that interdisciplinary fields typically represent the most promising directions and opportunities for technological innovation, as breakthrough innovations often occur at the crossroads of scientific disciplines.

Qiming Venture Partners was established in 2006 and has successively set up offices in Shanghai, Beijing, Suzhou, Hong Kong, Seattle, Boston, and the San Francisco Bay Area.

Currently, Qiming Venture Partners manages 11 US dollar funds and seven RMB funds, with total assets under management reaching $9.4 billion. Since its establishment, the firm has focused on investing in outstanding early-stage and growth-stage companies in sectors such as Technology and Consumer (T&C) and Healthcare.

To date, Qiming Venture Partners has invested in more than 480 high-growth innovative companies, among which over 180 have achieved exits through listings on exchanges such as the New York Stock Exchange (NYSE), NASDAQ, the Hong Kong Stock Exchange (HKEX), the Shanghai Stock Exchange (SSE), and the Shenzhen Stock Exchange (SZSE), as well as through mergers and acquisitions. More than 70 of these portfolio companies have become industry-recognized unicorns and super unicorns.

Lilly Asia Ventures (LAV) is a premier venture capital fund dedicated to investing in the life sciences and healthcare sectors. Headquartered in Shanghai, China, with offices in Hong Kong, China, and Silicon Valley, USA, our long-term vision is to build great companies that overcome diseases and improve human health through breakthrough products, and to serve as a trusted partner for outstanding entrepreneurs seeking smart capital.

HongShan is committed to helping entrepreneurs build enduring, great companies by providing its portfolio companies with abundant global resources and valuable historical expertise. As “entrepreneurs behind entrepreneurs,” HongShan focuses on investment opportunities in technology, consumer, and healthcare sectors. Over the past 17 years, HongShan has invested in more than 900 companies characterized by distinct technological advantages, innovative business models, and high growth potential.

Jiacheng Capital focuses on early-stage investments in the technology sector, paying close attention to innovators in traditional industries and pioneers in emerging fields, firmly believing that “technology drives business transformation.” We concentrate on angel rounds—“the first money for innovators”—to partner with promising young talents who have the potential to become future tech leaders, jointly harnessing the power of innovation to shape the future. Hong

Xiamen Jinyuan Zhanhong Equity Investment Fund is a market-oriented and professional fund-of-funds platform established by Xiamen Jinyuan Investment Group Co., Ltd., and managed by Xiamen Jinyuan Equity Investment Co., Ltd. The fund focuses on a "fund-of-funds + direct investment" model, targeting sectors such as big health, new energy, advanced intelligent manufacturing, and industrial internet. Upholding its mission, the fund leverages Jinyuan Group’s diverse financial instruments to drive industrial development with determination and vigor.

Zhongxin Capital is a professional fund manager under the Zhongxin Group. Through its “Park Innovation” and “Park Development” series of funds, it is based in the Suzhou Industrial Park (SIP), extends its reach to various cooperation zones within the Zhongxin network, and radiates outwards via the China-Singapore International Business Cooperation Center (offshore). Focusing on regional leading and advantageous industries, and emphasizing its distinctive role in empowering the industrialization and internationalization of “Specialized, Refined, Differential, and Innovative” (SRDI) enterprises, Zhongxin Capital actively engages in venture capital activities.Established in August 1994 through cooperation between the Chinese and Singaporean governments, Zhongxin Group serves as the main entity for park development and a vehicle for China-Singapore collaboration, making significant contributions to the development and construction of the Suzhou Industrial Park. In 2019, Zhongxin Group was listed on the Shanghai Stock Exchange. Committed to its mission of “Building China’s Dreams, Creating New-Type Parks,” Zhongxin Group adheres to an industry-centric and people-oriented approach. It has established park development and operation as its core business segment, supported by two wings: industrial investment and green public utilities. Through segment synergy and resource aggregation, the Group achieves high-level integration of industry and city characterized by “thriving industries, comprehensive supporting facilities, green and low-carbon practices, and open innovation,” thereby contributing to national technological innovation and industrial upgrading.

Oriza Holdings has focused on the field of equity investment since its establishment in 2001. With assets under management exceeding RMB 100 billion, it is one of China’s leading equity investment institutions. Since its inception, the firm has prioritized investment opportunities in emerging industries such as integrated circuits, biopharmaceuticals, artificial intelligence, nanotechnology applications, cloud computing, and big data, while adhering to its commitment to supporting the real economy and promoting industrial transformation and upgrading. To date, Oriza Holdings has made direct investments in over 1,200 projects, and its fund of funds has invested in 150 subsidiary funds.

The Peking University Technology Transfer Fund is the first technology transfer fund established by Peking University, jointly initiated by Peking University, the Beijing Science and Technology Innovation Fund, and several other renowned investment institutions. Following a public selection process, Founder H Fund was appointed as the fund manager. With a scale exceeding RMB 1 billion and a maximum duration of up to 12 years, the fund serves as patient capital. It will focus on high-end “hard tech” sectors, prioritizing investments in original innovation, with the aim of promoting the commercialization of scientific and technological achievements and bolstering national innovation capabilities.

Junshan Capital Markets boasts many years of experience in managing private securities investment funds. It has launched actively managed private securities investment funds, focusing on the new economy industries and strategically positioning itself across seven disruptive sectors to capture high-quality investment opportunities. As one of the first market-oriented managers of private securities fund-of-funds (FOF) in China, Junshan Capital Markets has established a screening system for private securities fund managers that combines qualitative and quantitative analysis, along with a rigorous risk control and investment research framework. Through on-site due diligence, it has conducted in-depth coverage of more than 1,000 private securities fund managers. Guided by the principle of diversified asset allocation, the firm pursues portfolio investment strategies aimed at generating stable excess returns for investors within a controlled risk profile. By strictly maintaining an approved whitelist and selecting top-tier private securities fund managers across various investment strategies, Junshan Capital Markets ensures multi-layered oversight tailored to appropriate market conditions. With long-term, in-depth research on private securities investment funds across the entire market, the firm has built a comprehensive selection framework, developed a unique methodology for evaluating, analyzing, and screening private securities funds, and established a scientific and rigorous system for investment and post-investment management. Client-centric and committed to integrating knowledge with action, Junshan Capital Markets continuously creates value for its investors.

Daoyuan Capital is a leading private equity investment firm specializing in the healthcare sector, dedicated to leveraging capital and industry resources to accelerate the growth of outstanding healthcare enterprises, deliver superior medical products and services to society, and advance human health. Currently, Daoyuan Capital manages 13 RMB-denominated funds and three USD-denominated funds. Its funds have invested in 78 high-quality projects, with 14 portfolio companies having completed initial public offerings (IPOs), including Jinxin Fertility (01951.HK), Viva Biotech (01873.HK), Sino Medical Sciences Technology (688108.SH), LBP Medicine (688393.SH), and Clover Biopharmaceuticals (02197.HK). As of 2022, one company has received approval from the China Securities Regulatory Commission for registration on the ChiNext board, one has passed the Hong Kong Stock Exchange’s listing hearing, and two others are in the IPO process. Daoyuan Capital expects that more than 10 of its portfolio companies will list on major domestic and international stock exchanges over the next two years.

Suzhou Industrial Park Leader Venture Capital Co., Ltd. was established in December 2012 as a wholly-owned subsidiary of the Suzhou Industrial Park Enterprise Development Service Center, with a registered capital of RMB 367.5 million. Its managed funds include the Park Science and Technology Innovation Fund and the Leader Yuanrui Fintech Fund, among others, with total assets under management amounting to RMB 2 billion. As the largest policy-oriented angel investment institution in Suzhou Industrial Park, it has played an active role in supporting the park’s efforts to attract high-end talent, accelerate corporate growth, and foster a technological innovation ecosystem.

YuanSheng Venture Capital is an investment firm focused on early-stage and growth-stage healthcare and medical sectors, headquartered in Suzhou BioBAY with a global reach. To date, it has invested in over 160 outstanding companies in the life and health fields, covering four major areas: new drug development, medical devices, in vitro diagnostics and precision medicine, as well as healthcare services. The firm has achieved substantial investment returns, with 16 of its portfolio companies having listed on capital markets such as the Hong Kong Stock Exchange and the STAR Market. YuanSheng Venture Capital has been repeatedly recognized as one of the Top 10 venture capital funds in China’s healthcare sector and as one of the most active healthcare investment institutions in China. Bringing together seasoned professional investors and a team of world-class scientific advisors, YuanSheng Venture Capital possesses extensive experience in entrepreneurship, venture capital, and corporate operations within the biopharmaceutical industry and beyond. Leveraging our professionalism, focus, and abundant industry resources, we are committed to becoming one of the most successful medical and pharmaceutical venture capital funds in China.

TEDAVC was established in October 2000 with a registered capital of RMB 1.873 billion and assets under management exceeding RMB 10 billion. As one of the first professional venture capital firms in China, TEDAVC has evolved over more than two decades of continuous development and accumulation into a comprehensive venture capital group engaged in controlling interests and operations of listed companies, management services for social capital, and investments across China. Its investment sectors include healthcare, semiconductors, software and big data, and intelligent manufacturing. From 2017 to 2021, the company was consecutively ranked among Zero2IPO’s “Top 50 Venture Capital Institutions in China,” as well as honored in the “Top 30 Healthcare Investment Institutions” and “Top 50 Hard-Tech Investment Institutions in China.” It also received the title of “Best Industrial Investment Institution in Semiconductors 2021” from the China Semiconductor Investment Alliance.