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The chief executive of Genmab, one of Europe’s leading biotech companies, says that despite “anti-China sentiment” in the U.S. life sciences, Western drug companies have made “amazingly impressive innovations” in China. ” needs to be utilized.
Jan van de Winkel, the head of the DKK132 billion ($19 billion) Danish biotech company, which recently announced its first acquisition by acquiring pharmaceutical companies in the US and China, said pharmaceutical companies He said China’s biotech cannot be ignored, saying it is “growing very rapidly with government investment.” A huge amount of money.”
His comments come even as the appetite for biotech acquisitions and signing Chinese-designed drug development deals appears undiminished thanks to high innovation and attractive prices. The announcement comes as a US bill to restrict manufacturers from partnering with drug companies is moving through Congress. .
AstraZeneca acquired Chinese company Graycell Biotechnologies for $1.2 billion in December, and GSK also signed two licensing deals with cancer drug maker Hanso Pharma worth about $1.5 billion each.
“China is a good place to start when it comes to getting innovation at an affordable price,” said Peter Berdalt, an analyst at Citi.
ProfoundBio, the company Genmab acquired for $1.8 billion, is based between Suzhou and Washington state, and its research is conducted at the BioBay complex, a vast state-backed science park in the Chinese city. .
“It’s like a new industrial revolution in biotechnology and life sciences,” said Van de Winkel, who recently visited the site. All the big companies are there, so I don’t think there’s anything to fear. ”
However, he added that the intellectual property from the contract with ProfoundBio is based in the United States and that Genmab plans to “transfer some of the intellectual property.” [drugs] Acknowledging the “anti-China sentiment” in the US, we provided ProfoundBio to our own verified suppliers outside of China to avoid risk.
Genmab’s acquisition of ProfoundBio, announced last month, marked a major shift in ambition for the company, which had not made an acquisition since its founding in 1999. The company focuses on antibody-based medicines that harness the power of the immune system. To deal with symptoms such as cancer.
The deal puts Genmab in competition with a drug owned by U.S. company AbbVie to treat ovarian cancer. ProfoundBio will also provide Genmab with its expertise in advanced antibody-drug conjugates. This is an advanced chemotherapy that involves combining antibodies that can target cancer cells with toxic drugs that can kill cancer cells directly, avoiding damage to surrounding healthy tissue.
However, this area is a crowded field. Global investment in ADCs totaled $86.3 billion in 2023, nearly triple the $31.1 billion total in 2022, according to GlobalData figures. Leading drugs, including Enhertz, a treatment developed by Japan’s Daiichi Sankyo and AstraZeneca, have already generated billions of dollars in sales.
Investors are waiting for more data on Profound Bio’s drug before making a judgment on its potential. “I can’t blame them for strategically buying, but given the competitive landscape, it’s hard to wax lyrical about it,” Verdalt said.
In addition to the ProfoundBio acquisition, Genmab has leveraged numerous license agreements with major pharmaceutical companies to develop other medicines, working with AbbVie, Johnson & Johnson, and Novartis. This gave him $4.2 billion in net cash and liquid securities, making it a profitable business and less dependent on the stock market.
Van de Winkel said the partnership with Genmab helped the company avoid an acquisition, which is common for biotech companies. He said Genmab’s success in listing in Copenhagen shows that “you can build an iconic biotech company if you stay in Europe,” but that a secondary listing on Nasdaq would give it access to long-term investors in the United States. He added that it was helpful.
However, Genmab has lost a lawsuit seeking to recover additional royalties from its licensing agreement with J&J for its most successful drug, Darzalex, and the U.S. drugmaker has given Darzalex a license to license follow-on drugs. There is some doubt as to whether it will be provided. Genmab’s stock price has fallen more than 8% this year, even though recent results showed Genmab’s sales beating analysts’ expectations.
