HiRO Files for IPO: Bridging Chinese Biotechs to Global Markets with Integrated Clinical Trial Solutions

Pharmaceutical CROs remain a sector with immense growth potential. Data from the China Commercial Industry Research Institute shows that the market size of China's pharmaceutical R&D and production outsourcing services grew from RMB 32.5 billion in 2016 to RMB 83.9 billion in 2020, and is projected to reach RMB 134.4 billion by 2022.

Meanwhile, the large number of small CROs in China has increasingly highlighted the intense competition within the industry, prompting many CRO companies to urgently seek new growth drivers.

On another front, internationalization has emerged as a recent hotspot. In recent months, Legend Biotech’s ciltacabtagene autoleucel received marketing approval from the U.S. Food and Drug Administration (FDA). Additionally, I-Mab’s bispecific antibody TJ-CD4B was recently granted Orphan Drug Designation by the FDA for the treatment of gastric cancer (including gastroesophageal junction cancer). Prior to these developments, BeiGene’s zanubrutinib successfully entered overseas markets, becoming the first Chinese innovative anticancer drug to achieve such success and paving the way for the global expansion of China’s innovative pharmaceuticals.

Amid the wave of international expansion, multiple Chinese pharmaceutical companies are poised to launch their global initiatives, seeking guidance from professional CROs to conduct clinical trials that meet the certification requirements of overseas regulatory authorities.

“Often, global expansion is simplistically understood as CROs recruiting patients overseas on behalf of Chinese pharmaceutical companies to complete clinical trials. However, conducting clinical trials abroad not only requires the efficient recruitment of patients who meet inclusion criteria but also necessitates compliance with diverse local regulatory requirements and adherence to the treatment recommendations of local experts. Companies must clearly define their objectives for going global, design appropriate clinical protocols, identify suitable key opinion leaders (KOLs), and establish milestones to manage the quality and pace of clinical trials,” stated Dr. Karen Chu, Founder and CEO of HiRO.

“Conducting clinical trials overseas is extremely costly. If the initial clinical design fails to meet regulatory requirements and there is no effective communication with regulatory authorities during the process, companies will incur substantial financial and time costs. Recently, several Chinese pharmaceutical companies have encountered setbacks in their global expansion efforts, highlighting the significant challenges that Chinese innovative drug developers still face in going global. Therefore, it is even more critical for companies to select appropriate partners to jointly pursue international markets.”

To this end, Dr. Karen Chu sought to build a bridge for Chinese pharmaceutical companies to successfully expand into global markets, and founded Shanghai Harvest Integrated Research Organization (HiRO) in September 2020. The company currently has branches in Beijing, Australia, New Zealand, and the Philippines.

Leveraging talent, AI, and big data technologies, HiRO has built a comprehensive service platform with high-quality clinical operations and management capabilities, providing end-to-end services and solutions to global clients. Its core team members each have 15–30 years of experience at leading international CROs and pharmaceutical companies. While helping Chinese innovative pharmaceutical companies expand overseas, HiRO also assists foreign pharmaceutical companies in entering the Chinese market. Currently, HiRO serves more than 30 global clients.

HiRO has completed two rounds of financing, with investors including Fengchuan Capital and OrbiMed. In addition, HiRO acquired the Australia- and New Zealand-based CRO company Pharmaceutical Solutions (“PharmaSols”) in December 2021, providing more options for clinical trials by domestic and international pharmaceutical companies.

Under China’s current policies, it is difficult for innovative drugs to secure high pricing and access a sufficiently large market. In contrast, the same innovative drug may be priced several times higher in overseas markets, making regions such as the United States, Europe, and Japan highly attractive in terms of market potential.

“From a financing perspective, an increasing number of investors are seeking to see innovative pharmaceutical companies pursue global expansion rather than focusing solely on the Chinese market.“Dr. Karen Chu told VCBeat.”

Driven by multiple factors, numerous Chinese pharmaceutical companies have been conducting overseas clinical trials in recent years to accelerate their global expansion. According to publicly available data from the Center for Drug Evaluation (CDE), as of July 2021, China had registered 1,126 international multi-center clinical trials, accounting for approximately 8.31% of all clinical trials.

Amid the surge in pharmaceutical companies expanding overseas, numerous CROs have begun offering global expansion services. According to Dr. Karen Chu, CRO firms currently capable of supporting pharmaceutical companies in their international expansion mainly fall into two categories:

One category is overseas CROs.Such companies have overseas teams and deep-rooted experience abroad. Chinese pharmaceutical companies can outsource their needs to overseas CROs; however, due to cultural and linguistic differences, these overseas CROs often fail to fully understand the specific requirements of Chinese clients. Meanwhile, most domestic pharmaceutical companies lack in-depth knowledge of overseas clinical trials and regulatory submissions, are unfamiliar with foreign regulations, and do not grasp the operational details of conducting clinical trials abroad. This mutual lack of understanding leads to inefficient collaboration and hinders a smooth global expansion.

Another category is domestic Chinese CROs.Such companies have a deep understanding of Chinese clients’ needs and are well adept at collaborating with them. However, they often lack mature and robust overseas teams, or may even have no such teams at all. Their typical model involves outsourcing to overseas contract research organizations (CROs). This full-outsourcing arrangement makes it difficult for these companies to implement refined management of the personnel at their overseas CRO partners, and also hinders their ability to ensure consistent service quality and standardized operations.

“Having engaged with numerous biotech firms, one common dilemma they face is the difficulty in finding a preferred CRO partner to facilitate their global expansion. The market demands CROs that not only understand Chinese clients’ needs and support their internationalization but also provide comprehensive and meticulous project management, while possessing in-depth knowledge of regulatory requirements and cultural differences across various countries.”

Overall, in facilitating pharmaceutical companies’ global expansion, current CRO firms generally suffer from inadequate comprehensiveness and flexibility in their services. “Amid the overseas expansion needs of pharmaceutical companies, there remains a gap between overseas CROs and China-based local CROs—a space brimming with opportunities,” said Dr. Karen Chu.The industry urgently needs to establish a CRO service platform that understands domestic market demands while aligning with international standards.HiRO was born in this context.

CRO is a talent-dependent industry, where human capital constitutes the greatest differentiator.HiRO's greatest differentiated advantage lies precisely in its personnel.

From filing the Investigational New Drug (IND) application, to conducting Phase I, II, and III clinical trials, and finally obtaining regulatory approval for successful market launch, the entire process is highly complex, with numerous details and issues requiring the attention and consideration of the participating teams. For instance, regarding regulations, first-line cancer therapies in China may differ from those in other countries; therefore, when designing international multi-center clinical trials, it is essential to understand whether overseas medication practices differ from those in China.

Therefore, throughout the clinical trial, the team must possess extensive clinical knowledge and have a thorough understanding of and conduct in-depth research on the regulations and healthcare environments of various countries.

HiRO’s core team members each bring 15 to 30 years of professional experience, with some having over two decades of expertise at large pharmaceutical companies, biotech firms, and global CROs. They are well-versed in the entire drug development lifecycle—from pre-IND through to market approval—and adept at addressing various challenges throughout this process. All company personnel have experience in international multi-center clinical trials, and all have project experience in the fields of oncology and immunology. Additionally, 45% of the staff have more than 10 years of industry experience.

Among them,Dr. Karen Chu, Founder and CEO of HiRO, has over 20 years of management and operational experience in the international CRO industry. She previously managed 600–800 clinical trials annually while leading a global clinical team of 5,700 professionals across more than 55 countries.

It is important to note that not every drug successfully reaches the market, as various challenges may arise during the process. HiRO’s team has encountered many of the issues commonly faced in new drug development. Leveraging this extensive experience, HiRO helps clients proactively mitigate risks, promptly identify and resolve problems, thereby facilitating the smooth progression of drug development and commercialization.

Another major advantage of HiRO lies in its flexible services.The Company can design tailored collaboration models to address the individualized needs of different pharmaceutical companies. For instance, if a pharmaceutical company requires only regulatory consulting, HiRO can provide standalone regulatory consulting services; if a pharmaceutical company needs to conduct Phase III clinical trials, the Company can also deliver targeted clinical trial services.

Dr. Karen Chu also mentioned, “In the past, many pharmaceutical companies were more inclined to choose large comprehensive CROs and lacked trust in small CRO enterprises. In fact,”Small CROs offer more flexible services, faster response times, and more refined service delivery.”

Furthermore, HiRO’s operational workflows and service standards are aligned with the global best practices of large-scale CROs. Following its acquisition of overseas CRO firms, HiRO rapidly integrates them by unifying processes and quality standards, thereby enhancing client confidence in the accuracy and completeness of data.

In December 2021, HiRO completed the acquisition of PharmaSols, a CRO company. PharmaSols has long focused on the Australian and New Zealand markets, with its core team boasting over 20 years of experience in conducting Phase I–IV clinical trials in these regions. The company can assist Chinese pharmaceutical enterprises in carrying out Phase I clinical trials in healthy volunteers in Australia and New Zealand. Furthermore, under eligible Australian government incentive programs, conducting Phase I clinical trials in Australia can enable pharmaceutical companies to recoup approximately 43% of their clinical trial costs.

HiRO has established its presence in China, Australia, New Zealand, and the Philippines, collaborating with multiple clients to actively accelerate the R&D of new drugs both domestically and internationally.

“Due to the substantial demand from our clients, we are frequently asked whether we can accelerate the expansion of our global business footprint. Therefore, HiRO is in a race against time.” In 2022, the company will continue to raise funds and pursue acquisitions to expand its operations in Asia, with a plan to establish its presence in South Korea, Japan, Europe, and the United States within three years.

In the future, both China’s and the global innovative drug and CRO industries will maintain strong, sustained growth. Going global will also remain a long-term trend for innovative pharmaceutical companies.

“What needs to be clarified is that, in the context of the global expansion trend, it is no longer viable for CROs to provide pharmaceutical companies with simple clinical trial services in traditional ways. One of the significant characteristics of next-generation CROs is that biotech companies can integrate CROs as part of their internal teams, working closely together. Whether pharmaceutical companies require regulatory expertise or medical talent, CROs can provide these resources. More importantly, CROs need to think from the perspective of pharmaceutical companies, helping them plan multi-center clinical trials, offering legal and regulatory consultations, and assisting with market launch strategies. This represents both new opportunities and challenges for CRO enterprises,” summarized Dr. Karen Chu.