GRAIL Secures $300 Million Series C Funding, Prepares for Hong Kong Launch of First Nasopharyngeal Cancer Screening Product

Image from the GRAIL official website

On the evening of May 21, 2018, liquid biopsy unicorn GRAIL announced the completion of an oversubscribed Series C financing round amounting to $300 million. Notably, unlike the previous two rounds, this financing saw significant participation from Chinese capital. The round was co-led by BridgeBio Capital (Huiqiao Capital), Allomed Partners (Tonghe Yucheng), and Hillhouse Capital. Other prominent domestic and international investors included Blue Pool Capital, China Merchants Securities International, CRF Investment, Huangpu River Capital (HPR), ICBC International, Sequoia Capital China, and WuXi NextCODE.

This company, which spun out of Illumina, has been in the industry spotlight since its inception. Its supporters range from Bill Gates and Jeff Bezos to Google Ventures and ARCH Venture Partners, as well as pharmaceutical giants such as Johnson & Johnson and Bristol-Myers Squibb, and even China’s Tencent. The company’s fan base includes IT titans, top-tier venture capitalists, pharmaceutical behemoths, and Chinese tech giants.

Like all those dedicated to early cancer screening, GRAIL aims to achieve early detection of cancer, as highlighted by the most prominent tagline on its homepage: “detect cancer early, when it can be cured” (translated by the author as: “Catch cancer while there is still time, leaving it nowhere to hide”).

To achieve this goal, GRAIL has invested significant time and money. The company utilizes Illumina’s ctDNA detection technology; although it did not need to develop the technology from scratch, it had never previously been applied to early cancer detection.

GRAIL is a methylation sequencing-based approach within the field of liquid biopsy for early cancer screening. A key characteristic of this technology is the necessity for extensive clinical trials. To this end, GRAIL has launched two large-scale clinical trials, namely CCGA and STRIVE, with combined investments exceeding $1 billion.

According to the company’s previous report at ASCO, results from the CCGA trial showed that the technology’s detection rate for early-stage cancers (Stage I to Stage III) ranged from 56% to 80%, with a sensitivity of 98%.

GRAIL merged with the Hong Kong-based company Cirina in 2017, since which time the U.S. firm’s ties with China have appeared to grow closer. It has not only attracted a large cohort of Chinese investors, but there were also earlier reports that it was planning an initial public offering (IPO) in Hong Kong (though the company has yet to issue an official response).

It remains uncertain whether the company will list in Hong Kong, but what is certain is that Cirina will serve as the link between GRAIL and China.

After merging with it, After becoming an operating subsidiary of GRAIL, Cirina continued its research collaboration with The Chinese University of Hong Kong. In the financing announcement, GRAIL revealed that its early-screening product, scheduled for launch in late 2018, would not target breast cancer—which had previously attracted over $1 billion in investment—but rather nasopharyngeal carcinoma, often referred to as the “Chinese cancer.” The initial market launch is currently set for Hong Kong. Nasopharyngeal carcinoma is also one of the cancer types in which Cirina’s founder, Professor Dennis Lo’s team, achieved a major breakthrough. In a 2017 publication, they demonstrated an effective non-invasive screening method for nasopharyngeal carcinoma through a clinical trial involving more than 20,000 participants, achieving a sensitivity of 97.1% and a specificity of 98.6%.

“GRAIL’s mission is to save lives through early cancer detection, and we are making rapid progress toward this goal. In our population-scale clinical trials, CCGA and STRIVE, we have enrolled more than 73,000 participants and are on track to complete the enrollment of the remaining participants this year,” said Ms. Jennifer Cook, CEO of GRAIL. “The blood test we have developed demonstrates high specificity and sensitivity, and recent data further support its potential. We are currently continuing these development efforts to optimize and validate one of our products, which holds promise for the early detection of multiple types of cancer.”

“These new international investors share our vision of bringing early cancer detection products to people around the world. We are fortunate to partner with them,” said Dr. Ken Drazan, President of GRAIL. “Many of our investors focus on Asia, which aligns naturally with our strategy. We plan to strengthen our capabilities and operations in these regions and will launch our first product for early detection of nasopharyngeal carcinoma in Hong Kong later this year.”

“The achievements made by the GRAIL team over the past two years in science, clinical development, and software engineering have left a deep impression on us. Our significant investment in GRAIL aligns with Huiqiao Capital’s vision of investing in the world’s most innovative life sciences technologies to enhance cross-border value creation,” said Mr. Yu Fan, Founder and Chief Executive Officer of Huiqiao Capital Group.