Exclusive Interview: Uncovering the Secrets Behind Burning Rock's RMB 300 Million Series B Funding

On the evening of December 28, 2016, VCBeat (WeChat ID: vcbeat) learned that Burning Rock Biotech held a signing ceremony for its Series B financing round, officially announcing the completion of RMB 300 million in Series B funding. The investors included Sequoia Capital, OrbiMed Asia Partners, CMB International, and Legend Star.In the newly released VCBeat Future Healthcare Top 100 List, Burning Rock Biotech ranked 26th with a valuation of RMB 2.5 billion.

As early as August 2015, Burning Rock Biotech completed a RMB 150 million Series A+ financing round, jointly invested by Lepu Capital, Sequoia Capital, and Legend Star. In 2014, it had secured a RMB 40 million Series A financing round.

According to insiders, this financing round was also vigorously facilitated by Legend Star. So why has this genetic testing firm garnered such strong interest from so many investors? Just how impressive is it?

Leng Yan, a director at Legend Star, told reporters, “We are optimistic about Han Yusheng, the founder of Burning Rock Biotech, and its core team. He has an outstanding medical background. In the more than one year since the company’s establishment, it has achieved remarkable growth. We are also drawn to its team and hope to support Burning Rock Biotech’s development through our professional collaboration, helping it become a leading enterprise in next-generation sequencing for oncology in China.”

Yang Yunxia of Sequoia Capital stated, “Burning Rock Biotech has implemented a strategic layout across China, with its business now covering most regions of the country. We believe it is well-positioned for success in the field of oncology next-generation sequencing in China. As the company moves forward, we hope to leverage Sequoia’s resources and brand to support its growth.”

Deng Feng of Northern Light Venture Capital stated, “Burning Rock Biotech possesses a robust bioinformatics analysis platform, as well as a highly professional elite team dedicated to product R&D and marketing. Since its inception, Burning Rock Biotech has achieved remarkable success, attracting the participation of more world-class investors. Through our joint efforts, I am confident that Burning Rock Biotech will become one of the most outstanding enterprises in the field of genomic testing for precision oncology.”

Burning Rock Biotech’s founder and CEO, Han Yusheng, gave up his position as a Ph.D. candidate in biology at Peking Union Medical College, general manager of BioTek’s China region, and an investor role to embark on an unconventional path by stepping out of his comfort zone to start a business.

Han Yusheng, a former investor at Northern Light Venture Capital, struggled to find startups worthy of his investment. “I found that many entrepreneurial ventures had irreparable shortcomings in their business models and teams, making them unable to meet expectations,” said Han, who ultimately decided to build his own team and venture out on his own.

In January 2014, Burning Rock Biotech was registered and established in Beijing, with its laboratory completed in Guangzhou six months later. In February this year, its Shanghai R&D center began operations. In August, it jointly established a 3,000-square-meter NGS clinical research laboratory with the Chinese Thoracic Oncology Group (CTONG), currently the most active academic organization in lung cancer research in China.

Han Yusheng analyzes that approximately 3.12 million new cancer cases are diagnosed annually in China, indicating a vast market and significant economic potential for precision medicine domestically. Furthermore, compared with foreign countries, China lacks sufficient tumor genomic atlas data.

Unleashing the power of genomic big data to bridge technological gaps, thereby empowering physicians to address mid- to long-term clinical challenges—this is the mission of Burning Rock Biotech. By deciphering the code of life through genomic big data and standing on the cusp of breakthroughs in medical technology, they leverage their expertise to transform tumor genetic testing from aspiration into reality. Innovation makes life better.

In addition, Burning Rock Biotech boasts a seasoned team with extensive expertise in bioinformatics, laboratory management, and operational management, as well as a marketing and sales team composed of professionals from leading companies in the molecular and genetic diagnostics industries, such as Qiagen and PerkinElmer. For instance, Mr. Chua Shaokun, the Chief Operating Officer and co-founder of the company, brings 13 years of experience in bioinformatics and translational medicine. He possesses internationally advanced technical capabilities and has accumulated comprehensive R&D experience closely related to personalized cancer diagnosis and treatment, including next-generation sequencing (NGS) data analysis, molecular diagnostics, clinical trial design, and biomarker development.

The Company’s Chief Medical Officer, Liu Hao, brings 14 years of clinical R&D experience from multinational pharmaceutical companies. His therapeutic areas of expertise include oncology, immunology, neurology, and urology. He has previously led the clinical development of multiple key drugs in China, including crizotinib, ceritinib, axitinib, and Velcade. He oversees all solid tumor R&D strategies and projects in China, including the strategy formulation and execution for landmark ALK TKI therapies such as ceritinib for lung cancer, as well as other pivotal medicines. He is recognized as one of China’s most experienced senior experts in the development of ALK TKIs.

Burning Rock Biotech is also the only third-party clinical laboratory with a dedicated Department of Clinical Medicine. At its inception, the company secured a combined RMB 43 million in investment from top-tier venture capital firms Northern Light Venture Capital and Legend Star. Burning Rock Biotech allocated these funds to laboratory construction and product research and development. As the saying goes, no pain, no gain. Under the leadership of Founder and CEO Hansheng Han, the Burning Rock team has pioneered advances in the clinical translation of personalized cancer therapy, accelerating the adoption of next-generation sequencing technology in the field of clinical oncology diagnostics.

In October 2014, Burning Rock Biotech launched its first product—the “Lung Cancer Targeted Therapy Gene Detection Panel”—which officially went on sale in November. This panel, based on next-generation sequencing (NGS) technology, is designed to perform genetic testing for lung cancer patients, thereby assisting patients and their attending physicians in selecting the most effective personalized targeted therapies.

In late January 2015, U.S. President Barack Obama announced a new initiative in the life sciences—the Precision Medicine Initiative—in his State of the Union address. This initiative is dedicated to curing diseases such as cancer and diabetes, with the aim of providing everyone with personalized health information. This heralded the true arrival of the era of precision medicine. The founders of Burning Rock Biotech seized the opportunity early on, striving to advance precision oncology even before the concept of precision medicine became widely known to the public.

Burning Rock Biotech has successively developed targeted therapy panels for lung cancer, diagnostic panels for differentiating benign from malignant thyroid cancer, liquid biopsy gene detection panels for lung cancer, and hereditary susceptibility gene panels for multiple cancer types. Compared with traditional testing methods, the next-generation sequencing technology employed by Burning Rock Biotech enables simultaneous detection of multiple genes, various mutation sites, and diverse mutation types, thereby saving time and reducing overall costs.

In addition to testing tissue samples, the company has also launched a blood sample testing service. The primary advantage of liquid biopsy is its non-invasive nature, requiring only a small amount of blood for analysis. It offers significant benefits for patients from whom tissue samples cannot be obtained or whose limited tissue precludes repeat sampling.

Currently, liquid biopsy is the most effective means of achieving real-time monitoring throughout a patient’s disease course. Burning Rock Biotech has successively launched OncoScreen™ and OncoScreen™ (Blood Version), personalized pharmacogenomic testing products for lung cancer based on circulating tumor DNA (ctDNA) in peripheral blood, as well as PanOnco™, a personalized pharmacogenomic testing product applicable to other cancer types.

The era of precision medicine has arrived. Hanyusheng believes that in the future business landscape, competition will be defined by “the fast fish eating the slow fish,” rather than “the big fish eating the small fish.”