Dingjing Bio Completes Series D1 Financing of Over RMB 100 Million to Accelerate Construction of China's Largest Precision Testing Network and IPO Process

Shanghai Topgen Biopharm Company Limited (hereinafter referred to as “Topgen Biopharm”) has completed a Series D1 financing round worth hundreds of millions of yuan. This round of investmentJointly invested by Guoke Liandong (Shaoxing Keqiao) Venture Capital Partnership (Limited Partnership), Ningbo Chuangda Funeng Enterprise Management Center (Limited Partnership) and its consortium, Sanya Yazhou Bay Venture Capital Co., Ltd., and Changshi (Sanya) Venture Capital Partnership (Limited Partnership), the company previously completed a C-round financing of RMB 120 million in 2021. Following this round of financing, the company will enter a fast track toward capitalization.

Founded in 2012, Topgen Biopharm is a high-tech enterprise dedicated to the integration, research and development, and sales of globally leading precision medicine technologies and products. Leveraging high-throughput sequencing as its core technology and self-developed reagents, Topgen Biopharm has established a nationwide dual-engine system comprising LDT (Laboratory Developed Tests) and IVD (In Vitro Diagnostic) kits across the fields of early cancer screening, companion diagnostics, prognostic monitoring, precision medication guidance for chronic diseases, and infectious diseases. The company aims to “make precision medicine accessible to all.”

Among the investors in this round, Guoke Liandong Venture Capital is an investment fund jointly established by CAS Holdings and the People’s Government of Keqiao District, Shaoxing City, with healthcare as one of its key focus areas; Chuangda Funeng is a smart manufacturing innovation platform whose investment portfolio covers medical devices and in vitro diagnostics; Yazhou Bay Venture Capital is the leading investment firm of the Yazhou Bay Science and Technology City in Sanya, Hainan Province, and its investment in Topgen Biopharm will accelerate the development of Hainan’s “Pilot Medical Zone”; Changshi Venture Capital is a growth-stage-focused fund set up by a large private conglomerate.

According toMr. Shen Weiqiang, Founder, CEO, and Chairman of the BoardIntroduction: Over the past decade, Shanghai Topgen Biopharm Company Limited has expanded its workforce from three employees to hundreds. Dozens of various laboratories are now distributed across 30 major and medium-sized cities throughout China, with annual revenue exceeding hundreds of millions of RMB. Driven by a dual-engine model of products and services, we have essentially established a precision testing network covering cities at all administrative levels nationwide. In the broader gene testing industry, particularly in cancer next-generation sequencing (NGS) testing, the current overall penetration rate is estimated to be below 10%. The three core reasons for this low penetration are: first, limited policy support for business development; second, the high cost of NGS sequencing; and third, the low adoption rate of new anticancer drugs. We anticipate that over the next three to five years, industry penetration will increase significantly, driven by the rollout of new Laboratory Developed Tests (LDT) regulations across various regions, the launch and widespread adoption of domestically produced sequencing systems, and broader inclusion of innovative drugs in national medical insurance coverage. Shanghai Topgen Biopharm is rapidly making breakthroughs in each of these three critical areas. For instance, we have successively obtained regulatory approvals in multiple regions, implemented a “dual-system” strategy utilizing both domestic and imported platforms during the R&D phase, and applied domestic sequencing systems in the application process for Class III medical device certification for cancer testing.

Mr. Shen continued to introduce that "high test volume, comprehensive product portfolio, extensive channel coverage, and innovative products" are the defining characteristics and competitive advantages of Topgen. Specifically, in terms of the volume of genetic cancer testing orders, the company has secured a leading position in the industry. Its nearly 100 active cancer testing products basically cover over 95% of patient needs. The business volume in Grade A hospitals located outside first-tier cities leads the industry in both absolute figures and market share, contributing to the national strategy of decentralizing cancer treatment resources. For new testing items with significant market potential and operating in a blue-ocean competitive landscape, Topgen has engaged in deep cultivation. It has proactively rolled out these tests nationwide in the form of Laboratory Developed Tests (LDTs), generating substantial revenue that will support and fuel large-scale sales once the corresponding In Vitro Diagnostic (IVD) products receive regulatory approval.

At the level of flagship products, the company’s offering for Minimal Residual Disease (MRD) detection—a product targeting a market valued at hundreds of billions of RMB and applied in prognostic testing for cancer patients—completed its R&D phase in the first half of this year and has been launched to the market, with sales gradually materializing recently. According to Mr. Shi Weiwei, the company’s CTO, Dingjing’s MRD detection product (MaRryDa™) possesses proprietary technological barriers. Its most significant feature can be summarized as integrating the strengths of the two currently prevalent MRD detection technical approaches (Tumor-Naive and Tumor-Informed), thereby creating unique product advantages:1. By incorporating molecular barcodes during library preparation, as seen in the first approach, it enables ultra-deep sequencing (500,000x coverage) in subsequent processes. Combined with proprietary bioinformatics algorithms, this enhances result reliability while ensuring high specificity after noise reduction.2. The core of this technology overcomes primer interference caused by multiplex PCR and the associated difficulties and time consumption of preliminary experiments, both of which are limitations inherent in the second approach.3. By leveraging the PCR enrichment method from the second approach for customization, it significantly improves detection sensitivity and reduces costs compared to the first approach.Thus, MaRryDa™ technologically combines the advantages of both technical routes. In practical clinical applications, it also shortens detection turnaround time and lowers testing costs.

For instance, given the nearly 200 million existing patients with thyroid diseases and approximately 500,000 new cases of thyroid cancer annually, the market size is projected to reach nearly RMB 7 billion per year following the widespread adoption of genetic testing for distinguishing benign from malignant thyroid cancers and guiding medication. Dingjing’s NGS-based thyroid cancer test (Sairuoli® Thyrolead®), which features a 25-gene panel (covering 17 mutation sites, 7 fusion sites, and 1 MSI molecular marker), was fully launched in the market last year, with its revenue expected to reach the tens of millions range this year. Meanwhile, the corresponding kit for distinguishing benign from malignant thyroid cancers is currently in the “preclinical study” phase, with clinical trials planned for this year and regulatory approval anticipated between 2023 and 2024.

Within Shanghai Topgen Biopharm’s pipeline of Class III in vitro diagnostic (IVD) certifications, its first Class III-certified product, the “PCR Kit for Guiding Statin Therapy in Hyperlipidemia,” is currently undergoing technical review. It is expected to receive approval and commence commercial sales within 2022. According to Mr. Shen, China currently has a population of 400 million individuals with dyslipidemia, including 160 million patients who require medication. With nearly 10 million new cases added annually, over 4 million people die each year from complications associated with hyperlipidemia. Given that hyperlipidemia requires lifelong pharmacological management and the penetration rate of genetic testing for medication guidance is currently near zero, Shanghai Topgen Biopharm believes that reasonable pricing per test could generate annual revenues on the scale of RMB 1 billion. In addition to its thyroid cancer assay kit, the company’s oncology portfolio includes diagnostics for homologous recombination deficiency (HRD), microsatellite instability (MSI) via circulating tumor DNA (ctDNA), molecular subtyping of endometrial cancer, and minimal residual disease (MRD) detection. In the chronic disease sector, pharmacogenomic guidance products for clopidogrel, hyperuricemia, and folic acid supplementation are either in preclinical development or poised to enter clinical trials.

VCBeat learned from Zhang Wenjie, the company’s CFO and Head of Capital Markets, that the company has initiated its IPO process and aims to complete its capitalization path within the next one to two years following this round of financing. Regarding the choice of capital market, Mr. Zhang highlighted three key points. First, the pathway for gene testing companies specializing in cancer detection to list on China’s A-share market has opened up, and we await further developments. Second, price reflects value. Although market sentiment fluctuates through cycles, high-quality underlying assets can transcend these cycles and reasonably reflect their intrinsic value in any market. The core indicators of “high quality” are high revenue growth, strong cash flow, and improving profit margins—precisely the financial performance Topgen has demonstrated in recent years. We believe that as the company continues to enhance its product portfolio, optimize its structure, and scale up its core flagship products, its financial performance will further improve. Third, as one of the few high-growth sectors within the overall economy, and given the substantial market capitalization capacity of the sector, the market is expected to assign a reasonably optimistic valuation. The company’s future performance in the capital markets looks promising.

Finally, Shen Weiqiang, Chairman and CEO of the Company, stated that this financing marks the beginning of a new decade. With significant responsibilities and challenges ahead, he expressed confidence that the vision of “making precision medicine accessible to all” will guide Topgen Biopharm to surpass a market capitalization of RMB 10 billion.