HK-based Chi-Med looks to tap funds in Nasdaq listing with China focus

Hutchison China MediTech, or Chi-Med, plans an initial public share sale on the Nasdaq that shows a geographic spread that already includes Hong Kong, mainland China, and London for a company that has ramped up clinical activity in oncology candidates by working with multinational partners.

Now listed in London, Chi-Med, which holds the majority of R&D unit Hutchison MediPharma (HMP) that is part of the Li Ka-shing-controlled CK Hutchison Holdings, did not offer pricing guidance or even an amount to be raised--though interest is expected to be high.

The move to raise money in the U.S. comes as a few high-profile industry-related Chinese companies moved to exit U.S. listings. Last month, Shenzhen-based Mindray Medical ($MR) cut an offer price to $27 per share from $30 in a management-led buyout. China's top CRO WuXi PharmaTech ($WX) is also expected to complete a $3.3 billion buyout and delist from the U.S. market.

But Chi-Med with 7 drug candidates in clinical-stage trials, including licensed deals with AstraZeneca ($AZN), Eli Lilly ($LLY) and Swiss-based Nestle sits among several oncology-focused companies in sharp focus that are either listed on the Nasdaq, like Cellular Biomedicine Group ($CBMG), or eyeing a listing, like BeiGene.

In July, Chi-Med reported 6-month interim results that showed net profit dropped to $2.3 million from $5.4 million compared to the same period a year ago. The results did however note major stepped-up clinical activity in the period. The company, in a detailed update on all of its pipeline candidates, also said it sees a threefold expansion in production by the end of this year or early 2016 in own-brand products.

But in the same month, Janssen Pharmaceuticals exited a 7-year alliance with HMP to develop a novel inflammation/immunology candidate HMPL-507. The HK-based company will now carry-on independently, according to a press release.

Earlier the same month, in a disclosure notice with few details, Chi-Med cemented its majority stake in HMP via a share exchange deal with Japan's Mitsui & Co. The announcement came ahead of study results later this year on a promising candidate for approval in China.

The transaction, which raised the direct holding of Chi-Med in HMP to 99.75%, followed just a few months after a May notice of a positive first proof-of-concept study result for fruquintinib, a candidate for treatment of patients with metastatic colorectal cancer in China.

In March, Chi-Med said it had met the primary endpoint of progression-free survival in a Phase II clinical trial for colorectal cancer candidate fruquintinib (HMPL-013), putting it one step closer to China approval, which would be the first modern drug from China since artemisinin was developed in the 1970s to treat malaria.

The results triggered milestone payments from Eli Lilly ($LLY) of $18 million to HMP. The companies entered into a co-development and commercialization agreement on the candidate in October 2013.

In October, HMP said it had completed enrollment in in a global Phase II study of savolitinib it is developing with AstraZeneca. Interim data is expected to be published at the American Society of Clinical Oncology meeting in 2016.

Chi-Med CEO Christian Hogg

In June, at the American Society of Clinical Oncology meeting in Chicago, Chi-Med presented preliminary data with collaboration partner AstraZeneca ($AZN) on AZD92891 for NSCLC that were called "encouraging" by Christian Hogg, CEO of Chi-Med.

In December last year, the unit started a Phase III study of the small molecule that selectively inhibits the tyrosine kinase activity associated with VEGF receptors to treat metastatic colorectal cancer patients who have failed at least two prior therapies.

The subsidiary also started a Phase Ib study of the compound in October 2014 to treat gastric cancer, and a Phase II study in June 2014 to treat non-small cell lung cancer.

- here's the release on the IPO filing registration
- and a release on savolitinib