Tianxinhe Biotech Files for IPO: Providing the 'Vegetable Basket' for Biopharma via Advanced Cell Culture Technologies

One afternoon in the new year of 2016, Chen Wenqing received a phone call from Dr. Zhao Chunlin, founder of Anlong Fund. At that time, Anlong Fund was planning to invest in a biopharmaceutical company. If the investment could be successfully made, Dr. Zhao Chunlin and Wu Yuepeng, Investment Director of Anlong Fund, hoped to invite Chen Wenqing to “come out of retirement” and participate in the management of this company. Coincidentally, not long before, the founder of this biotech company had also approached him, with intentions that aligned unexpectedly with those of Anlong Fund.

“Since my friends trust me so much, I’ll give it a try.” In September 2016, Chen Wenqing was invited to join Tianxinhe Biotechnology and serve as its Chairman. He told VCBeat that there weren’t many reasons behind his decision to join the company.

Chen Wenqing, an elderly man who often humorously refers to himself as a “free spirit,” is in fact the pioneer of the industrialization of cell culture media in China. In 2004, he co-founded Beijing Qingda Tianyi Biotechnology Co., Ltd., the first domestic enterprise dedicated to the research, development, and production of cell culture media and bioreactors. The company once stood as a leading supplier in China’s biopharmaceutical industry, providing cell culture media, bioreactors, and large-scale cell culture technical services. In 2010, Qingda Tianyi was acquired by Merck KGaA, Germany.

Tianxinhe Biotech, established in 2014, is a high-tech enterprise specializing in the provision of customized animal cell culture media, the research and development and manufacturing of bioreactors, the development of biopharmaceutical process technologies, and CRO/CMO services for the industrialization of biopharmaceuticals. This company will mark a new starting point for Chen Wenqing in the field of biopharmaceuticals.

Cell culture is a foundational technology for the biopharmaceutical industry. All biopharmaceutical research relies on mammalian cells. Therefore, customized cell culture media and large-scale animal cell culture technologies are essential supports for biopharmaceutical research.

Take vaccine production as an example. To produce inactivated vaccines, it is first necessary to obtain viruses with high expression levels. These viruses are then cultured in customized cell culture media, and viral bulk solutions with high antigen content are produced using bioreactors. Following these steps, the viruses undergo inactivation and purification. Only vaccines manufactured through this series of processes can meet the requirements for pilot production.

Prior to 2004, the domestic cell culture media market was almost entirely monopolized by foreign companies. Before 2008, the domestic bioreactor market was also nearly dominated by foreign enterprises. Even as late as 2014, the majority of cell culture media and bioreactors used in China were imported. Very few domestic manufacturers of cell culture media and bioreactors were capable of competing with major international brands.

In recent years, the biopharmaceutical industry has seen robust growth, driven by the return of overseas talent and strong government support. Consequently, demand for cell culture technology within the industry is steadily increasing, and the cell culture market is gradually becoming more active and competitive.

Although Tianxinhe is not the only player in this blue-ocean market, it is a highly recognizable company. Chen Wenqing stated, “This recognizability is most clearly reflected in its business layout and team.”

Tianxinhe’s business layout is divided into three major segments: personalized animal cell culture media, bioreactors, and the development of biopharmaceutical process technologies. These three business areas correspond to the products and technologies required for the three different stages of vaccine production mentioned earlier.

“There are some companies in China that focus solely on cell culture media, and some machinery manufacturers also venture into the bioreactor production business. However, few combine these three areas,” Chen Wenqing told VCBeat. According to Chen, Tianxinhe has adhered to this “three-in-one” model since its establishment in 2014.

“This model essentially establishes a platform for biopharmaceutical process technologies. Such a platform is an essential requirement for any biopharmaceutical company,” said Chen Wenqing.

Cells are akin to crops, cell culture media serve as the soil required for cell growth, and process technologies act as the climate. When the soil and climate change, crop growth is inevitably affected. Therefore, personalized cell culture media and process technologies are of great significance for improving the production efficiency of vaccines and other pharmaceuticals.

This is a foundational technology with high entry barriers. While companies with strong technical capabilities have the capacity to develop it in-house, for those with relatively weaker expertise in this area, seeking collaboration with suitable partners is a more viable strategy.

“Animal cell culture media,” “bioreactors,” and “biopharmaceutical process technologies” are all indispensable. However, it is extremely rare for domestic enterprises to integrate these three business segments.

Downstream enterprises typically need to partner with multiple vendors, which is not only cumbersome but also requires integration across different manufacturers’ products and technologies. By consolidating these products and technologies onto a single platform, Tianxinhe can save downstream enterprises significant time and effort.

In addition to its existing process development capabilities for biopharmaceuticals, the company has integrated downstream technologies—such as virus purification and protein separation—to establish a comprehensive downstream biopharmaceutical technology platform.

Many biopharmaceutical companies have overseas or returnee teams. However, Tianxinhe boasts a fully localized team. Tianxinhe’s technical team has accumulated extensive experience in personalized cell culture media screening, cell adaptation and clone selection, suspension cell culture technology, protein purification, and the development and industrial application of bioreactors. It is an industry driver and technological leader in the upgrading of process technologies within China’s biopharmaceutical sector.

“A reliable team with a proven track record,” “steady business operations,” and “strong market demand”—it was precisely these highlights that attracted Anlong Fund. In 2016, the firm invested RMB 20 million in the company.

The continuous development of the biopharmaceutical industry will create opportunities for upstream sectors. Core supporting technologies for China’s biopharmaceutical industry still largely rely on foreign companies. Cell culture media represent a significant portion of manufacturing costs in pharmaceutical production; localizing these products and technologies can help reduce drug manufacturing costs to some extent.

Therefore, as the biopharmaceutical industry continues to develop, the market prospects for key raw and auxiliary materials and supporting technologies in cell culture media will become increasingly promising. The current gaps among domestic enterprises present both a sense of mission and significant opportunities for companies like Tianxinhe that have established an early presence in this field.

As Wu Yuepeng stated, “Whether or not gold is unearthed, shovels are always in demand.”