HanHong Sci Secures Nearly RMB 1 Billion in Series A Funding to Advance Non-Natural Amino Acid Supply Chain

VCBeat has learned that, recently,Shanghai Hanhong Technology Co., Ltd. (hereinafter referred to as “Hanhong Technology”) has completed a Series A financing round of nearly RMB 100 million, led by Wisdomont Asset Management and participated in by Jinshuihu (Shanghai) Venture Capital Management Co., Ltd. The proceeds from this round will be primarily used for the construction of production facilities, increased investment in research and development, and supplementation of working capital.Previously, Hanhong Technology had successively completed its seed and angel financing rounds.

Hanhong Technology, established in 2003, has been dedicated to the non-natural amino acid industry and the field of biocatalysis for over two decades. With extensive industry experience, the company has mastered core technologies for the industrial production of numerous products and holds dozens of invention patents. Its current core product portfolio includes non-natural amino acids, protected amino acids, amino acid derivatives, peptides, and peptidomimetic pharmaceutical intermediates. Hanhong Technology provides high-quality products and services to more than 3,000 new drug R&D and pharmaceutical manufacturing companies both domestically and internationally. It is recognized as a National High-Tech Enterprise and a Shanghai “Specialized, Refined, Differential, and Innovative” (SRDI) Enterprise.

Non-natural amino acids primarily refer to those not encoded by the genetic code and not involved in protein synthesis, which have significant applications in various fields such as pharmaceuticals and agrochemicals. With the development of innovative drugs, the application scale of chiral drugs, peptidomimetic drugs, and peptide drugs derived from non-natural amino acids in the pharmaceutical industry is expanding. According to QYResearch's "China Non-Natural Amino Acid Market Report 2023-2029," the market size of non-natural amino acids in China is projected to reach USD 1.89 billion by 2029, with a compound annual growth rate (CAGR) of 1.5%.

According to Frost & Sullivan, the global market size for peptide drugs is projected to grow from $62.8 billion to $96 billion by 2025, while China’s peptide drug market is expected to expand from $8.5 billion in 2020 to $18.2 billion by 2025, indicating substantial market potential. Notably, drugs targeting metabolic diseases via the GLP-1 pathway are experiencing explosive growth, with their market size anticipated to reach $28.2 billion by 2025. The sustained expansion of the peptide drug market will drive rapid development in upstream industries, including protected amino acids and synthesis reagents for peptide raw materials.

Traditional industrial production processes for non-natural amino acids primarily rely on chemical methods, including chemical resolution, asymmetric transformation, and chiral synthesis. These chemical approaches suffer from drawbacks such as numerous side reactions, low chiral purity, and poor utilization efficiency of ineffective enantiomers. The novel biocatalytic technology for producing non-natural amino acids, developed by Hanhong Technology, has effectively reduced production costs, achieved product chiral purity exceeding 99.9%, significantly decreased the discharge of waste water, waste gas, and solid waste, and substantially lowered safety risks. In 2013, the technology for its biocatalytic production of non-natural amino acids was awarded the First Prize of the Shanghai Science and Technology Progress Award. In 2015, the company’s biocatalytic project technology was appraised by the Yancheng Municipal Science and Technology Bureau as reaching an “internationally advanced level.” In 2016, the company undertook a major scientific and technological achievement conversion project in Jiangsu Province.

Currently, Hanhong Technology is capable of producing over 3,000 types of non-natural amino acids and nearly 10,000 types of protected amino acids. Among these, products such as L-tert-leucine, L-norvaline, R-3-aminobutyric acid, D-serine, D-phenylalanine, and D-proline hold a leading position in the industry and are widely used in the production of antihypertensive, antidiabetic, antiviral, and peptide-based pharmaceuticals. The company’s Boc-protected and Fmoc-protected amino acids are extensively utilized in the manufacturing of peptide and peptidomimetic drugs. With the rapid development of GLP-1 receptor agonists for type 2 diabetes and weight management, such as semaglutide and tirzepatide, the production volume of the company’s protected amino acids has been increasing rapidly.

Currently, Hanhong Technology has established two R&D centers and possesses a synthetic biology technology platform, a chiral chemistry technology platform, and a green chemistry technology platform. The total area of its R&D laboratories reaches 3,000 square meters, with the company initiating over one hundred routine R&D projects internally each year.

The research scope of the synthetic biology technology platform encompasses technologies such as gene design and novel enzyme construction, fermentation engineering and enzymatic catalysis, and product separation and purification. Currently, the company has mastered the industrial-scale production and application technologies for nearly 20 types of enzymes, including leucine dehydrogenase, isopropanol dehydrogenase, amino acid decarboxylase, aminoacylase, penicillin acylase, nitrile hydratase, and nitrilase.

Chiral Chemistry Technology Platform encompasses chiral reagent production technology, chiral asymmetric synthesis technology, and chiral resolution technology. The platform holds numerous patents and has achieved industrial-scale production, with its tartaric acid series and mandelic acid series resolving agent technologies leading the industry.

The green chemistry technology platform has developed over 1,000 green synthesis technologies for organic reagents, as well as more than 20 green synthesis technologies for novel active pharmaceutical ingredients (APIs) and intermediates.

Leveraging its core technology platforms, Hanhong Technology provides a wide range of molecular building blocks, pharmaceutical intermediates, and active pharmaceutical ingredient (API) products, spanning from the drug discovery stage to commercial launch. The company emphasizes scalability in product development. “We aim to pursue vertical growth in drug molecular building blocks by engaging with customer needs at an early stage and further developing these into scalable intermediates or API candidates,” said Ma Shizhong, Chairman and General Manager of Hanhong Technology.

Image courtesy of Hanhong Biotech

In terms of production capacity, Hanhong Technology has established two manufacturing bases in Liaocheng, Shandong Province, and Lanzhou, Gansu Province, covering a total area of over 100 mu. These facilities have an annual industrialized production capacity of 1,000 metric tons of active pharmaceutical ingredients (APIs) and pharmaceutical intermediates. Meanwhile, Hanhong Technology is actively preparing for the construction of a CDMO base for pharmaceutical intermediates and APIs, spanning nearly 200 mu, to further expand its amino acid derivative production capacity and advance the implementation of peptidomimetic API and peptide API projects.

In the future, Hanhong Technology will focus on the non-natural amino acid industry chain, adhere to the integration of drug molecular building blocks, intermediates, and active pharmaceutical ingredients (APIs), strive to become a specialized, refined, distinctive, and innovative enterprise in the API and intermediate sectors, and emerge as a “hidden champion” in the non-natural amino acid industry.

For this round of financing,Mr. Ma Shizhong, Chairman & General Manager of Hanhong TechnologyThe company stated: “We extend our sincere gratitude to Wisdomont Capital and Jinshuihu Fund for their recognition and trust in this funding round. Following this financing, Hanhong will increase investment in its R&D platform to enhance innovation capabilities in foundational application areas such as green synthesis, genetic engineering, biocatalysis, fermentation engineering, biochemical separation engineering, and chiral chemistry. We will also further invest in production lines to boost large-scale manufacturing capacity, thereby achieving integration of pharmaceutical building blocks, pharmaceutical intermediates, and active pharmaceutical ingredients (APIs). With the joint support of all employees, shareholders, customers, and suppliers, we aim to become a specialized, refined, distinctive, and innovative enterprise in the intermediates and APIs industry at an early date.”

Dr. Cheng Hao, Partner at Wisdomont CapitalStatement: Hanhong Technology is a leading enterprise in the field of non-natural amino acids in China. With over 20 years of deep engagement in the non-natural amino acid industry chain leveraging synthetic biology technologies, the team has accumulated extensive experience ranging from small-scale trials to large-scale production. Currently, the team possesses integrated capabilities covering drug molecular building blocks, pharmaceutical intermediates, and active pharmaceutical ingredients (APIs). We are pleased to lead this round of financing and look forward to the company continuing its steady growth under the leadership of Mr. Ma, while seizing market opportunities and actively expanding into overseas markets to become an internationally leading enterprise at an early date.

Mr. Xie Jianchao, Investment Director of Jinshuihu FundStatement: Hanhong Technology has been deeply engaged in the field of non-natural amino acids for many years. The team has accumulated extensive experience in the pharmaceutical intermediates industry, possessing robust capabilities in synthetic biology, chemical synthesis development, and engineering scale-up. Non-natural amino acids hold broad application prospects in new drug synthesis and peptide therapeutics. We are optimistic about the commercial opportunities within this niche segment of pharmaceutical intermediates. We are pleased to have reached a cooperation agreement with Hanhong Technology and look forward to the company supplying more competitive non-natural amino acids and derivative products to the market in the future.

Shengshan Capital, established in 2014, specializes in equity investments in the life sciences and healthcare sectors. The company’s founder and investment research team possess extensive professional medical expertise, industry background, and capital operation experience. Guided by the principles of “technology-driven, clinically oriented, industry-integrated, and value-based investing,” Shengshan Capital deeply focuses on leading enterprises in niche segments such as biotechnology, innovative drugs, and digital health, serving as a long-term enabler for these companies. Committed to becoming a boutique investment firm in the healthcare sector, its portfolio includes WuXi Biology (01873.HK), Sunlight Nuohua (688621.SH), Obio Technology (688238.SH), Kangfeng Biotech (6922.HK), Meizhong Jiahe, Yikon Genomics, Gene+ Tech, Compass Therapeutics, Starlight Medical, Jiangfeng Bio, and Changjin Biologics, among others.

Jinshuihu Fund is strategically held by Shanghai Jinshan Capital Group and the Bay Area High-Tech Zone. Established in 2021, it serves as a direct investment platform for the market-oriented reform and innovation of state-owned assets in Jinshan District. The fund aims to fully leverage the resource advantages of state-owned capital and the operational efficiency of market-based mechanisms, focusing on the local area while radiating influence across the Yangtze River Delta region. Its investment stages cover early-stage, growth-stage, and mature-stage companies.