Innovent Biologics and ETANA Announce Indonesian Approval of Dabevac (Bevacizumab), Facilitated by Legend Capital’s Strategic Partnership

On June 14, 2022, Innovent Biologics and Indonesian biotechnology company PT Etana Biotechnologies Indonesia (ETANA) jointly announced that Bevagen (bevacizumab injection; Indonesian brand name: Bevagen) had received approval from the Indonesian Food and Drug Authority (BPOM) for the treatment of five indications: metastatic colorectal cancer, metastatic triple-negative breast cancer, advanced non-small cell lung cancer, ovarian cancer, and cervical cancer.Under the exclusive licensing agreement reached between both parties, ETANA is committed to bringing Dayoutong® (Bevacizumab Injection) to the Indonesian market.

Based on trends in the pharmaceutical industry over the past two years, exchanges between China’s pharmaceutical sector—particularly the innovative drug segment—and Southeast Asia have become increasingly frequent. This approval not only signifies that Dayoutong is poised to become the first antibody drug from China to be commercialized and locally manufactured in Southeast Asia, but also indicates thatSoutheast Asia Market Expansion: The Conversation Shifts from Discussion to Commercial Implementation, attracting more industries and capital to focus on the Southeast Asian market and embark on the path of global expansion for emerging markets.

Why has this new wave of expansion into Southeast Asia surged in the past two years? What future trends will it shape for the global outreach of China’s healthcare industry?VCBeat interviewed Nathan Tirtana, founder of Etana, and Qi Fei, Executive Director at Legend Capital, to gain deeper insights into Etana and its backstory.

Etana was established in 2014, jointly founded by its founder Nathan Tirtana and a Southeast Asian pharmaceutical family-owned enterprise.

Nathan, an Indonesian of Chinese descent, studied in Australia before coming to China in 2001 for further studies. He subsequently worked in Chinese pharmaceutical companies for over a decade, witnessing the rapid development of China’s pharmaceutical industry. Upon returning to Indonesia, Nathan recognized that the country’s biopharmaceutical sector was still in its infancy. Determined to contribute personally to advancing Indonesia’s pharmaceutical industry, he persuaded his partners to jointly establish Etana.

ETANA Founder & CEO Nathan Tirtana

As the largest country in Southeast Asia by both area and population (270 million people), Indonesia’s pharmaceutical market environment is highly representative of the region.

Corresponding to its large population is a weak pharmaceutical industry. Indonesia’s pharmaceutical market is dominated by a vast array of over-the-counter (OTC) medicines and generic drugs, supplemented by a small share of local traditional herbal medicines, patented drugs, and vaccines. The biologics sector is virtually nonexistent, with only a few imported products available. Due to the underdeveloped pharmaceutical industry and limited purchasing power, major pharmaceutical companies have largely deprioritized market expansion in Southeast Asian countries like Indonesia, resulting in prolonged launch cycles for innovative products.

In reality, over the past two decades, Indonesia has maintained an economic growth rate of 5–6%, with its per capita GDP reaching $4,349.5 in 2021. This indicates that the relatively affluent segment of the Indonesian population already possesses sufficient ability to pay for high-priced patented pharmaceutical products. Furthermore, Indonesia’s new national health insurance scheme, implemented by the government in 2014, has continued to expand over the past two years and has now achieved nearly 100% coverage. As a result, Indonesia has initially established the financial capacity to afford innovative drugs and high-end biologics.

On one hand, Indonesia has a weak pharmaceutical industry; on the other, it faces robust healthcare demand driven by economic growth. This has created a significant imbalance between supply and demand in the country’s pharmaceutical sector.This held immense opportunity, which Nathan identified and became the key catalyst for the establishment of Etana.

Establishing Etana in Indonesia was no easy feat. Given the complete absence of a local biopharmaceutical industrial base, it took Nathan nearly two years simply to recruit talent and build the team. In 2016, the company initiated the construction of its production facility, a process that involved considerable effort in sourcing suppliers and engaging with regulators to align on standards and regulations. As the production base entered the construction phase, determining which products to manufacture emerged as a new challenge. After thorough research and analysis, Nathan decided to enter the market with erythropoietin (EPO), which already had a certain foundation in the local market, and gradually established a partnership with North China Pharmaceutical Group. Finally, in March 2018, the company’s first product was officially launched for commercial sale, marking the beginning of rigorous tests for its commercialization team.

As ETANA’s commercialization efforts gradually gained momentum, leading Chinese investors and pharmaceutical companies began to recognize the latent opportunities in Southeast Asia. Among them, Legend Capital was the first to invest in ETANA.

Legend Capital’s focus on the Southeast Asian market is driven not only by the identified supply-demand imbalance in Indonesia’s pharmaceutical sector, but also by the clear international expansion aspirations demonstrated by its portfolio companies.

In the exchange between the Chinese market and the global market, the focus has long been on drug imports. However, with the gradual maturation of China’s domestic innovative drug industry over the past five years, the global expansion of domestically developed innovative drugs has emerged as a new industry trend. We observe that most collaboration cases occur in exchanges with mature markets such as the United States, Europe, Japan, and South Korea, while few companies have paid attention to the broad market of developing countries.

Indonesia’s pharmaceutical industry lacks sufficient supply capacity and seeks to exchange market access for technology by introducing high-end biopharmaceutical products; meanwhile, domestically produced innovative drugs aim to expand globally, leveraging technological expertise to empower international markets and capture greater market share. The demands on both sides are perfectly aligned, with only a connector missing in between.

Thus, starting in 2019, Legend Capital began by seeking opportunities in Indonesia’s pharmaceutical market.Legend Capital has decided to establish a strategic foothold in the Southeast Asian pharmaceutical market through investment, thereby paving the way for Chinese-made high-end biologics to enter Indonesia.There are not many options for this bridgehead; the most critical requirement—possessing certain capabilities in the production and sales of biological drugs—narrows the field down to three companies.

Qi Fei, Executive Director at Legend Capital, told VCBeat: “Indonesia’s biopharmaceutical industry is still in its early stages. There are only three local companies with a certain foundation in biologics, and among them, Etana is the only one with the potential for in-depth cooperation with Chinese enterprises.”

Biopharmaceuticals is a capital-intensive industry with long development cycles. Nathan and his team were determined to commit to the field for the long haul and began considering entry into the more urgently needed area of antibody-based therapeutics. However, at that time, Etana lacked the necessary funding, technical expertise, and governance mechanisms to develop antibody drugs. It was at this critical juncture that Legend Capital stepped in at just the right moment.

Lack of funding: Hong Tan, Managing Director of Legend Capital, has known Nathan for over a decade. Based on their shared understanding of the global expansion of Chinese biopharmaceutical companies and the dynamics of industry development, Legend Capital and Etana quickly decided to work together to drive in-depth cooperation between the two parties;

Lack of Technology: Innovent Biologics is a leader in the field of antibody-based therapeutics in China and an investee of Legend Capital. Through Legend Capital’s facilitation, Innovent decided to enter into product licensing and technical collaboration with Etana, while Etana also assists Innovent in expanding into the Southeast Asian market;

Lack of Governance Mechanisms: With the assistance of Legend Capital, Etana’s management team has truly become the “owners” of the company through a series of equity restructurings.

The needs of both parties are well aligned. As funding, technology, and governance mechanisms are addressed one by one, Etana is also rapidly accelerating onto a fast-track development path.

Nathan recalled the situation: “We hit it off with Legend Capital right away. Developing biopharmaceuticals in Southeast Asia is no easy feat. Our years of prior accumulation in regulatory registration and market access, manufacturing facilities, and commercialization proved to be the right move, and the tremendous support from Legend Capital and the ecosystem they have built has truly given us the wings to take off.”

The collaboration between Legend Capital and Etana brings not only investment but also industrial resources and two decades of experience from China’s biopharmaceutical industry.

In July 2019, Legend Capital and Innovent jointly conducted a site visit to Indonesia to evaluate Etana’s facilities, production processes, quality control, and other key operational aspects. Ultimately, Innovent’s experts gave Etana highly favorable assessments, affirming the promising prospects for collaboration with Etana. They also provided numerous recommendations beneficial to the company, tailored to the current stage of biopharmaceutical development in Southeast Asia. Nathan and his team greatly appreciated the professionalism demonstrated by their Chinese industrial partners and investors, further strengthening their resolve to collaborate with Chinese partners and establish Etana as an international company.

ETANA Factory Interior

The Southeast Asian market differs significantly from China’s, requiring Chinese industries and capital to learn and adapt across various dimensions, including policy regulation, folk customs, and healthcare systems. Moreover, the concrete execution of cross-border investments and industrial cooperation is by no means a simple endeavor. As the project’s executive lead, Qi Fei traveled frequently between Beijing and Jakarta in 2019, engaging in in-depth discussions with Nathan and the Etana team on every detail pertaining to the industry, strategy, market access, and other aspects. Due to the impact of the pandemic, the due diligence phase following the 2020 Spring Festival had to be conducted entirely online.

Discussing the deal, Qi Fei remarked, “This was likely the most complex transaction I have ever handled. Given its cross-border nature, restructuring components, and industrial collaboration elements, the process was highly intricate and involved numerous stakeholders, spanning nearly two years. Fortunately, all parties shared a common vision and mutual trust. We were impressed by Nathan and Etana’s team’s determination to establish a biopharmaceutical platform company in Southeast Asia, while investors from both industry and capital sectors were highly understanding and cooperative, united in their desire to support the company’s growth.”

At the end of 2020, the Series A financing round, led by Legend Capital and with participation from Innovent Biologics and Dahua Venture Capital Management Co., Ltd. (UOBVM), was finalized through agreement signing. In 2021, Etana entered into a pipeline collaboration with Innovent Biologics to comprehensively expand its portfolio in oncology biologics. Subsequently, with support from China’s industrial and capital sectors, Etana established extensive collaborations with multiple renowned Chinese pharmaceutical companies, expanding into the fields of vaccines and anti-infectives.

With the entry of Chinese industry players and capital, Etana has entered a fast-track development phase. The substantial support in terms of pipeline and technology, coupled with the resources brought through strategic partnerships, has made Etana increasingly distinctive in Indonesia. The company has reoptimized its positioning and strategy: Etana will serve as a bridge facilitating the Southeast Asian market entry of innovative Chinese pharmaceutical companies, linking these enterprises on one hand while establishing a foothold in Indonesia and Southeast Asia on the other, thereby building core competencies in industrial translation and commercialization.

In its partnership with Etana, Legend Capital places the greatest emphasis on Etana’s core capability in local industrial translation. This capability has established a significant competitive barrier in Southeast Asia, where the biologics sector is still in its early stages. Etana will further strengthen these three core competitive advantages:

The first level is access capability (Access).The company has established robust regulatory and government market access relationships through years of exploration and accumulation. It has built strong and solid ties with the Indonesian Ministry of Health and regulatory authorities, which will facilitate the company’s effective navigation of regulatory requirements and drug approval processes.

The second dimension is the manufacturing capacity for biologics (Manufacturing).The Company possesses leading biopharmaceutical manufacturing capabilities in Indonesia and across Southeast Asia. It operates one of the largest GMP-compliant facilities in Indonesia (6,500 square meters) for local biopharmaceutical production (only four such facilities exist in Indonesia). The Company’s relevant facilities have obtained Halal certification from the Indonesian Ulema Council (MUI), an authoritative body in Indonesia, enabling its products to be marketed to countries in the Islamic world.

The third dimension is commercialization capability (Commercialization).Etana honed its team through prior EPO sales, rapidly emerging as an industry leader within three years. The company boasts a professional, localized sales force and has established a nationwide sales network in China. In the field of oncology, it has forged collaborative relationships with major key opinion leaders (KOLs) and institutions across the country.

And now,With the support of Chinese industry and capital, the final piece of ETANA’s rapid growth puzzle—its business development capability—has gradually been established., through introductions by Legend Capital and other partners, the company has rapidly engaged in discussions with more than ten renowned Chinese biopharmaceutical companies regarding potential collaborations. The plan is to introduce drugs currently lacking in Indonesia, such as monoclonal antibody therapies for cancer, COVID-19 vaccines, and antiviral medications.

With this, ETANA’s core competency module of “AMC+BD” has been unveiled, and the company’s strategy and business model have become increasingly clear. ETANA will continue to expand its collaborations with Chinese enterprises, leveraging joint efforts with its partners to deliver high-quality, affordable innovative Chinese medicines to Indonesia, Southeast Asia, and even the Islamic world more rapidly and effectively.

On April 11, 2022, GoTo (GOTO.JK), Indonesia’s largest internet technology company, was listed on the Indonesia Stock Exchange, with its market capitalization once exceeding $30 billion. Behind this milestone stood numerous Chinese internet industry players and investors, marking a new high point in the global expansion of China’s internet sector that began in 2012.

In the biopharmaceutical industry, it remains to be seen whether a “Copy from China” model will emerge. Given the distinct characteristics and developmental stages of the sector, lessons from the internet industry may not be directly applicable. However, by expanding into emerging markets along the Belt and Road Initiative, identifying local partners with a deep understanding of China, and leveraging investment and product licensing collaborations, this comprehensive strategic framework could be replicated across various fields. This approach may offer a new pathway for the global expansion of China’s pharmaceutical industry.

The path for Chinese innovative drugs to go global, pioneered by capital firms such as Legend Capital and industry players like Innovent Biologics, is highly exploratory in nature. The achievement of cooperation milestones between Innovent Biologics and ETANA has fully demonstrated the feasibility of this approach. In the coming years, using the ETANA case as a model, the export of Chinese innovative drugs to developing countries may become a new trend, redefining the logic of industrial globalization. We also look forward to China’s biopharmaceutical industry and capital sectors writing more “Chinese stories” on a broader stage.

At the Top 100 Forum on the afternoon of the 14th, Qi Fei, Executive Director of Legend Capital, engaged in a direct dialogue with Nathan, Founder & CEO of ETANA. This marks ETANA’s debut in China. Scan the QR code on the poster below to watch the live stream of the conference.

Founded in 2014, Etana is a leading biopharmaceutical company in Indonesia, dedicated to the research and development, manufacturing, and sales of biopharmaceutical products for the Southeast Asian (ASEAN) market. Committed to providing patients with high-quality, affordable innovative medicines, Etana has established the most advanced local production facilities that comply with international standards and Indonesian FDA regulations. These facilities have also obtained Halal certification from the Indonesian Ulema Council (MUI), a recognized authoritative body in Indonesia. With a strong focus on oncology and vaccines, Etana has built an integrated system for the R&D, manufacturing, and commercialization of antibodies, mRNA, and other biological therapies. Through active collaborations to expand its product pipeline and increase production capacity, Etana aims to become the leading biopharmaceutical enterprise in Southeast Asia.

ETANA’s management team comprises professionals with international educational backgrounds and extensive experience in the biopharmaceutical industry. The company has secured investment and collaborative support from international institutional investors and leading biopharmaceutical companies. ETANA is committed to supporting the Indonesian government’s industrial development plans and meeting the region’s growing market demand by locally producing high-quality, innovative, and affordable biopharmaceutical products.

Legend Capital, established in April 2001, is a fund management company under Legend Holdings Corporation, specializing in early-stage venture capital and growth-stage private equity investments. Over the past two decades, Legend Capital has adhered to international standards and created best practices in fund operations and management. Through its proactive value-added service system, Legend Capital drives innovative corporate growth, consistently delivering strong investment returns across multiple sectors while advancing China’s industrial progress and social development. Guided by the vision of “becoming an internationally influential investment firm” and upholding the core value of “Prosperity with Integrity,” Legend Capital actively fulfills its social responsibilities.

Legend Capital has consistently maintained a systematic investment strategy in the field of innovative drugs, adhering to the investment philosophy of “global vision, Chinese perspective.” It seeks technologies and teams with genuine international competitiveness to address unmet clinical needs. Its portfolio companies, including Kaiyin Technology (688687.SH), Innovent Biologics (01801.HK), Harbour BioMed (02142.HK), and Recbio Pharma (02179.HK), have been listed on the A-share and Hong Kong stock exchanges. Additionally, Legend Capital has invested in leading enterprises in niche sectors, such as Gebo Biotechnology, Suzhou Ribo Life Science, PegBio, Jiayin Biopharma, LinkMed Pharmaceuticals, and Longxin Biopharmaceuticals.