Terasi Pharma: A Global ADC Innovator Back on Track with Zhenbaodao Investment and Poised for International Breakthrough

Investment and financing in the biopharmaceutical sector continue to heat up.

According to statistics from VCBeat, the global healthcare industry witnessed 2,199 financing events in 2020, with the total amount raised reaching a record high of $74.9 billion (approximately RMB 516.93 billion), representing a year-on-year increase of about 41%. The global biopharmaceutical sector once again led all sub-sectors, recording 786 transactions totaling $36.9 billion (approximately RMB 254.7 billion).

Among these, conjugated drugs have emerged as a highly prominent field in recent years. Within this category, antibody-drug conjugates (ADCs) have become a key strategic focus for innovative pharmaceutical companies worldwide. Compared with small-molecule therapies, ADCs offer greater specificity and fewer side effects; relative to monoclonal antibody therapies, they demonstrate superior tumor-killing efficacy and a more pronounced bystander effect.

Since the launch of the first ADC drug in 2000, 14 ADC drugs have been approved on the global market. Global innovation in ADC drugs has gradually entered a golden period of development, with a new peak expected in the next 3–5 years.

Amid this trend, a large number of innovative biopharmaceutical companies have emerged. However, in the emerging field of antibody-drug conjugates (ADCs), standing out requires comprehensive strengths across multiple dimensions, including innovation capability, depth of clinical understanding, R&D proficiency, and execution ability.

Dr. Wu Youling, who led the CMC team for the world’s first ADC product to secure FDA clinical trial approval (BR96-Dox) and oversaw CMC-Regulatory affairs for the blockbuster marketed ADC Brentuximab, may already hold a “first-mover” advantage. Since returning to China in 2011 to found Teruisi and subsequently securing significant investment from the publicly listed company Zhenbaodao, she and her company have been enjoying considerable prominence.

What sets Teruisi apart in its ADC pipeline strategy? What are Teruisi’s plans for the future? Due to the pandemic, our planned visit to Teruisi did not take place. Instead, we ultimately conducted an online interview with Dr. Wu Youling, a leading expert in the field and the founder and general manager of Teruisi.

The original aspiration of entrepreneurs sometimes determines the manner and duration in which a company will sustain its journey.

When we asked Dr. Wu why he had given up a promising career in the United States to return to China and start a business, he recounted the story behind his decision. Ultimately, his motivation remained rooted in a desire to serve his country by “developing affordable medicines for the general public.” This philosophy has been consistently reflected in Teruisi’s strategic layout in the field of antibody-drug conjugates (ADCs), which will be discussed in detail later.

She went to the United States for her studies in 1984 and earned her Ph.D. from Rutgers University in April 1991. Subsequently, she led and participated in the development of multiple (six) blockbuster products at renowned international pharmaceutical giants such as Bristol-Myers Squibb, Johnson & Johnson, Sanofi (Genzyme), and Seattle Genetics, a leader in antibody-drug conjugate (ADC) technology. During her tenure at Bristol-Myers Squibb, she oversaw the Chemistry, Manufacturing, and Controls (CMC) aspects of BR96-Dox, the first ADC product to successfully receive FDA clinical trial approval worldwide (1993). Later, she joined Seattle Genetics, where she was responsible for CMC and regulatory affairs for Brentuximab (Adcetris), which was then preparing for pivotal Phase II clinical trials. “Brentuximab has four designations: Fast Track, Accelerated Approval, Orphan Drug, and Breakthrough Therapy,” Dr. Wu emphasized.

Her decision to pursue a career in the field of antibody-drug conjugates (ADCs) was driven by her recognition of the limitations of chemotherapy. Although chemotherapeutic agents are widely used as first-line clinical treatments due to their efficacy in halting or slowing the growth of malignant tumors, a significant proportion lack the ability to specifically target tumor cells. This often results in systemic toxicity and substantial adverse effects. Conversely, monoclonal antibodies alone exhibit inferior cytotoxic potency compared to conventional chemotherapeutic agents. ADCs combine the advantages of both modalities, enabling highly efficient, targeted identification and eradication of tumor cells while minimizing damage to healthy tissues.

The impetus for returning to China may have been planted long ago.

As early as 2000, Han Qide, an academician of the Chinese Academy of Sciences, had contacted her, hoping she would return to China to engage in the research and development (R&D) of monoclonal antibody drugs. However, given that the domestic industrial environment was not yet mature at the time, she chose to continue her cutting-edge research in the United States, where she accumulated extensive experience in the R&D and successful commercialization of multiple monoclonal antibody products, including expertise in the field of antibody-drug conjugates (ADCs). Although various sectors actively invited her to return to China for career development during this period, she declined each offer. Ten years later, in December 2010, Chen Zhu, then Minister of Health, met with her and extended an invitation to return to China to start a business, once again encouraging her to contribute to the nation’s health industry. This time, Wu Youling accepted the invitation and led a team of senior scientists with extensive experience in biopharmaceuticals, including the ADC field, back to China.

Regarding her return to China, Dr. Wu stated that Steven Kozlowski, Director of the FDA’s Office of Biologics, had told her, “China needs a cohort of scientists like you, who have accumulated extensive experience abroad, to return home and drive the development of China’s biopharmaceutical industry.” She had long understood this imperative; thus, while gaining professional experience, she closely monitored developments in China. In her view, there remains a significant shortage of high-quality drug supplies domestically. The range of medications available for clinical use in China is quite limited, and many patients cannot afford certain high-end cancer therapies due to their prohibitive costs.

Ten years later, recognizing that the entire biopharmaceutical sector had undergone significant improvements compared to a decade earlier and encouraged by the substantial reforms implemented by China’s regulatory authorities, she saw hope and believed it was time to make a contribution. She therefore resolutely decided to return to China.

Unlike other domestic biopharmaceutical founding teams, the early core members of Teruisi’s founding team are predominantly overseas-educated PhDs. With 26 to 33 years of drug R&D experience at leading international pharmaceutical companies, they possess in-depth knowledge of overseas regulatory policies, cutting-edge global technologies, and technological development trajectories. Their shared vision on the strategic layout of the biopharmaceutical industry ultimately facilitated the formulation of Teruisi’s product pipeline and development strategy.

The Teruisi team includes Wang Huiwen, who returned to China alongside the founder to launch the startup. As Senior Vice President (SVP) of Product Process R&D and Production Technology, she brings over 33 years of experience in biopharmaceutical development. She has held positions at renowned companies such as Bayer, Genentech (Roche), and WuXi Biologics, and played key roles in leading the development, launch, and manufacturing of products including Factor VIII, Herceptin, Bevacizumab, and Kadcyla. She is an expert in process development and technology transfer. Also on the team is Dr. Xie Yansheng, SVP of Production Operations, who has over 26 years of experience in the R&D and management of monoclonal antibody products. He has worked at prestigious firms such as GlaxoSmithKline and Bristol-Myers Squibb, contributing to or leading the development and launch of products including IL-8, Albugon, Orencia, Velafermin, and CR011. He spearheaded the scale-up of processes to commercial production at a 20,000-liter scale. Rounding out the leadership is Dr. Zhong Shan, who oversees preclinical and early-stage R&D. A former Department Director at Genentech and Senior Scientist at Genzyme, he possesses extensive expertise in antibody screening and construction. He established various bioanalytical methods for monoclonal antibodies and pioneered in vitro immunogenicity prediction. He participated in the R&D and launch of multiple monoclonal antibody products, including Roche’s two ADC products, Kadcyla and Polivy, as well as nine ADC candidates currently in development.

Compared with other teams in China, members of its team have participated in the development of three out of the 14 ADC drugs already launched globally, and have been involved in as many as 18 ADC product candidates. Ardeagen, a U.S.-based company, is Teruisi’s international partner in the ADC field.

Teruisi focuses on the research, development, and commercialization of First-in-Class ADC (FIC) products. Leveraging its first-mover advantage, Teruisi has maintained a significant lead in the FIC space from an early stage.

Teruisi’s clinical-stage product pipeline comprises two biosimilars and five innovative biologics.

One of the products is a national Class 1 innovative antibody-drug conjugate (ADC) drug, primarily targeting refractory non-Hodgkin lymphoma. It demonstrates eightfold greater efficacy than unconjugated monoclonal antibodies with reduced toxicity. Phase I clinical trials are currently underway; upon completion of Phase II trials, marketing approval can be applied for through the special review pathway.

Its bevacizumab biosimilar is the first biosimilar from a Chinese enterprise to receive Investigational New Drug (IND) approval from the U.S. FDA, earning high recognition from the agency as “substantially similar,” which waived the requirements for an advisory committee meeting and preclinical animal studies. Following its Phase I clinical trial in the United States, it became the first bevacizumab biosimilar approved to conduct “interchangeability trials with the reference product.” It has now launched an international multicenter Phase III clinical trial, with the FDA even agreeing that 70% of the Phase III participants can be from China—a first for the FDA.

Whether gaining access to China’s special review pathway or having the FDA waive advisory committee meetings and preclinical animal studies, while approving that 70% of patients in Phase III clinical trials can be from China, all demonstrate Teruisi’s inherent strength and capabilities.

Teruisi also has distinct perspectives on its product pipeline layout and development strategy. It can be said that the company has adopted two major directions (subdivided into three sub-directions) to advance in parallel.

In the realm of biosimilars, the company has chosen to enter the U.S. biosimilar market—a high-barrier, high-margin sector—by developing high-quality biosimilars with low development risks. This strategic decision is driven by two main factors. First, the market size is substantial; the international biosimilars market, particularly the U.S. market for interchangeable biosimilars, is vast. Second, Teruisi possesses the necessary qualifications for market access in the United States and meets the essential conditions for international collaboration on combination therapies.

In the realm of new drug development, Teruisi has developed a differentiated novel agent based on known targets—a PD-1 nanobody—characterized by ease of administration (subcutaneous injection), stability at room temperature (eliminating the need for cold-chain transportation), high expression levels (8 g/L), and low production costs. Regarding target selection, Teruisi’s TRS005 avoided the then-popular targets such as HER2, c-Met, and Trop2 in the highly homogeneous ADC landscape, opting instead for the CD20 target. The other three ADC candidates all target first-in-class (FIC) mechanisms and are among the global leading pipeline assets. This differentiated strategic layout and the first-in-class potential of its products have positioned Teruisi as a rising star in the ADC sector.

Teruisi has established its own proprietary technology platform encompassing innovative host cell lines and cell line development platforms with independent intellectual property rights; protein purification processes featuring high expression (8 g/L), high recovery rates (>80%), and high purity (>98%); as well as cGMP-compliant large-scale commercial manufacturing facilities and quality management systems that meet international standards. The developability of monoclonal antibody drugs is highly dependent on Chemistry, Manufacturing, and Controls (CMC). Historically, CMC and process scale-up have represented significant industrialization bottlenecks for Chinese biopharmaceutical companies, challenges that Teruisi has effectively addressed in both areas.

 
The pursuit of cutting-edge technologies has also led Dr. Wu to point out that the company will establish its R&D bridgehead in the United States in the future, because it is “closer to innovation.” “Our current technology platform was built based on our past experience and remains original. However, after leaving the United States, where the degree of originality is highest, our experience may become outdated. Therefore, we need to position our R&D bridgehead in the United States.”

“In her view, substantial foundational biomedical research is essential to better facilitate R&D and launch new drug products. Currently, the biopharmaceutical sector faces a severe talent shortage, particularly of professionals with independent critical thinking skills. ‘In fact, much of the foundational research in Europe and the United States initially lacked clear practical applications, yet it has since played a pivotal role. Take CTLA-4 and PD-1, for example; no one originally anticipated that they would fundamentally transform cancer treatment paradigms as they have today,’ said Dr. Wu. She expressed hope that the government would support and encourage research institutions to increase investment in basic research. She remarked that such foundational research could potentially reshape the entire industry, noting that the government is placing growing emphasis on basic scientific research.”

“Teruisi’s development strategy has been different from that of other companies from the very beginning,” said Dr. Wu Youling. “So far, I believe our strategy remains correct.”

Teruisi is likely one of the few companies in the industry that has targeted commercialization from the very outset. Teruisi has chosen to deploy high-expression cell lines and build a manufacturing facility with a 5,000-liter capacity, aiming to reduce the final market price of its drugs by lowering production costs. In Dr. Wu’s words, this strategy is about “making high-end biologics affordable for the general public.”

“First, we must pursue an internationalization strategy. We are not merely adopting an ‘In China for China’ approach; rather, we are actively targeting the U.S. market. Second, to develop affordable medications accessible to the general public, we must achieve industrialization and commercial implementation. We cannot remain indefinitely in the early stages; instead, we must ensure the tangible realization of industrial scale-up,” stated Dr. Wu.

In the past, most innovative biopharmaceutical companies did not genuinely consider commercialization and cost control issues in their early stages. In contrast, Teruisi adopted a “commercialization-oriented” approach by designing stainless steel bioreactors with a single-batch capacity of 5,000 liters. At that time, mainstream innovative biopharmaceutical companies in China still opted for single-use bioreactors. This was partly because these companies failed to take commercialization and cost considerations into account, and partly because they had not overcome the technical barriers involved.

Under the influence of Teruisi, an increasing number of biopharmaceutical companies have begun to invest in the construction of large-capacity stainless steel tank facilities. In terms of cost control, Teruisi has gone even further. Dr. Wu explained, “The use of proprietary high-expression, high-stability cell lines, combined with high-yield, large-scale production, also signifies a substantial reduction in costs.” The cost of PD-1 is now $50 per gram, making it accessible to a broad patient population!

To better advance its overseas market expansion, Teruisi has adhered from the outset to the high standards of international biopharmaceutical companies, holding itself to strict requirements. “Many companies have failed in the U.S. for various reasons, but Teruisi’s market entry and regulatory submissions in the U.S. have proceeded smoothly (with zero deficiency letters), thanks to its familiarity with overseas policies and technologies.” Teruisi has built a commercial-scale production facility compliant with international cGMP standards (4 × 5,000 L = 20,000 L), all of which position the company favorably for strong commercial prospects.

In fact, it was not until around 2016 that China’s supportive policies for innovative biopharmaceutical enterprises saw significant improvement. With the intensification of policy support, Teruisi has also ushered in a prime opportunity for its own development—

Following the receipt of national special funding for major new drug creation under the “12th Five-Year Plan” for its innovative drug TRS005 in 2014, Teruisi’s TRS003, TRS006, and TRS008 were granted national special funding for major new drug creation under the “13th Five-Year Plan” in 2017. In July of the same year, Teruisi’s biosimilar TRS001 obtained clinical trial approval in China. In October, its biosimilar TRS003 received clinical trial approval in China, followed by FDA clearance for clinical trials in the United States in November. In May 2018, TRS005 received clinical trial approval from the Center for Drug Evaluation (CDE) through the special review pathway. In October 2020, an Investigational New Drug (IND) application for TRS004 was filed in the United States.

When we asked Teruisi what missing link needed to be addressed to accelerate its development, Dr. Wu candidly stated that the company needed to make better use of the capital markets. This was also one of the key reasons why Teruisi ultimately chose to partner with Zhenbaodao. As a publicly listed company, Zhenbaodao’s expertise in capital operations will better facilitate Teruisi’s future strategic layout and growth.

Teruisi’s unique insight into the ADC field and its long-term persistence have ushered in a new dawn for the company.

In June 2021, Zhenbaodao Pharmaceutical announced a RMB 400 million investment in Teruisi. The capital injection from this listed pharmaceutical company has enabled Teruisi to build on its existing success and achieve further growth.

In fact, Teruisi is currently excited about the latest data from a clinical drug—the Phase Ia dose-escalation study involving 21 patients with end-stage cancer demonstrated excellent efficacy of Teruisi’s drug: the disease control rate (DCR) in the recommended dose group was 100%, and the objective response rate (ORR) reached as high as 83%.

Zhenbaodao’s investment in Teruisi was by no means accidental; long before the deal, Zhenbaodao had conducted in-depth research on the ADC sector. Subsequently, Zhenbaodao directly or through its affiliated industrial funds invested in multiple ADC companies, including Duoxi Bio and Aikeruisi.

Teruisi operates a first-class, large-scale commercial biologics manufacturing facility in China, having overcome technical bottlenecks in process scale-up and mass production of monoclonal antibodies. This capability provides a cost advantage and enables Teruisi to offer CDMO services to domestic and international partners. Investing in Teruisi signifies a strategic deep dive into the biologics sector, accelerating Zhenbaodao’s strategic transformation and alignment with international standards. Furthermore, Teruisi’s established commercial manufacturing capacity can synergize with other biopharmaceutical companies invested in by Zhenbaodao, thereby enhancing the efficiency of industrial translation for innovative products.

For Teruisi, which had previously stalled due to its equity structure, development has returned to the right track with Zhenbaodao’s investment and respect for the management team. The injection of new capital also enables Teruisi to better devote resources to the research and development of innovative drugs, while Zhenbaodao’s channel-building efforts will further contribute to Teruisi’s future growth.

With early-stage hurdles cleared and new clinical trial data demonstrating superior efficacy, Teruisi is poised for a new phase of robust growth.

According to Dr. Wu’s plan, the biosimilar bevacizumab TRS003 and TRS005 (ADC) were expected to file for marketing approval in 2023. Teruisi, which has consistently emphasized overseas markets, will establish its R&D bridgehead in the United States, with its products launched simultaneously in domestic and international markets to achieve true globalization.

After more than a decade of strategic development, what further surprises Teruisi will bring remains to be seen and is certainly worth anticipating.