Real estate

With a big cash assist from local officials, BeiGene is building a $330M biologics facility in China

Xiaodong Wang, BeiGene

In the latest sign that China’s biotech industry is developing at high speed, one of its most prominent biotechs is preparing to break dirt on a $330 million biologics manufacturing center in Guangzhou which will also provide some direct support for R&D activities.

BeiGene struck a deal to build the facility in partnership with local development officials who are kicking in close to half of the money. The biotech will partner with Guangzhou GET Technology Development Co., which is contributing $150 million in cash and convertible loans for the joint venture. BeiGene will provide $30 million of the cost and the rest will be covered by loans.

According to the announcement, the JV plans to finance clinical-stage drug R&D as well.

“This joint venture will enable BeiGene to keep pace with a growing demand for the development and use of biologics in China and global markets,” commented Xiaodong Wang, the co-founder and chairman of the scientific advisory board of BeiGene.

BeiGene, trading on Nasdaq as {BGNE}, has been growing fast, with a special focus on oncology, a big field in China. The biotech has built a staff of more than 200 working on four cancer therapies. The lead drug is a BTK inhibitor now in the clinic, with a PD-1 drug coming up behind, along with a PARP inhibitor. And it’s working in partnership with Merck KGaA.

The Chinese government is playing a big role in fostering its biotechs. Chi-Med, which has a research staff based in Shanghai, has been getting a government subsidy to help pay for the work it’s doing on new cancer drugs, according to CEO Christian Hogg. And Chi-Med is now prepping its first new drug application to China’s FDA, testing the country’s commitment to fostering more home-grown therapies.

Guangzhou officials sound like they’re all in, hoping to see their biotech hub near Hong Kong grow around this new project.

“We attach great importance to this project and believe that the successful introduction of BeiGene Biologics will transform Guangzhou Development District into a center for the innovative biopharmaceutical industry, promote the development of the biotechnology industry in the region, and provide a powerful driving force for economic transformation and upgrade. The government will provide strong support in funding, management service, and creating a good business environment,” commented the administrative committee of Guangzhou Municipal Government and Guangzhou Development District.


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