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THE BOLD NEW PLAYER IN CANCER:HOW CHINESE BIOTECHS ARE FUELING THE ONCOLOGY SPACEModerator: James T. Lee, PhDAssociate Principal, Oncology Lead
Guest Panelists: Brad Loncar, CEO, Loncar Investments LLCGuillaume Vignon, PhD, SVP, BD, BeigeneWeimin Tang, PhD, Global Business Head and EVP, I-Mab BioPharma
December 2, 2019
2China Biotech Webinar December 2, 2019© Cello Health BioConsulting 2019
Background on Cello Health BioConsulting, Previously Defined Health
We consult with the world’s most innovative biopharma companies, applying our strategic insight to early-stage platforms and programs. Our advice reduces development and commercial risk and increases stakeholder value.
Our Strategic Advice, given early in development (pre-PoC), drives value along the development continuum and influences ultimate outcome.
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The Biotech’s Conundrum in Immuno-Oncology Weighing
Hot Versus Cold Tumors, CPI-Naïve Versus CPI-Experienced
PatientsDecember 4th 11:30am-1pm ESTModerator:• Jeff Bockman, PhD, EVP, Oncology Practice, Cello Health BioConsulting
Panelists:• Mike Curran, PhD, Associate Professor, Immunology, MD Anderson• Emmett Schimdt, MD, Associate Vice President, Merck• Vanessa Lucey, PhD, Director, Cancer Research Institute• Steve Worland, PhD, President and CEO, eFFECTOR Therapeutics
Cello Health BioConsulting’s Next Insight Series Webinar:
REGISTER
Keynote Speakers:
Michael CurranAssociate Professor, Dept. of Immunology
Scientific Director, ORBIT PlatformThe University of Texas MD Anderson Cancer Center
Department of Immunology, Division of Basic Sciences
Stephan Grupp, MD, PhDDirector of the Cancer Immunotherapy Program
Director of Translational Research for the Center forChildhood Cancer Research at CHOP
Medical Director of the Stem Cell LaboratoryChildren’s Hospital of Philadelphia
Special Guest:
Ira MellmanVice President, Cancer Immunology
Genentech
Panels to Include:• Paradigm-shifting platforms IO & Non-
IO• Investing into Oncology: Who, What, &
Where?• Vaccines: From Paleo to Neo, Cancer
Vaccines in New Age of IO• Next Wave of Diagnostics, Including
Precision IO: Early and Smarter, The Better to Cure
• Advance Therapeutics ½ Day Session
Early Bird Code:EB2020
4China Biotech Webinar December 2, 2019© Cello Health BioConsulting 2019
China BioPharma is Seeing an Unprecedented Boom Driven by China Policy, Money, and Need
Regulatory:• China joins ICH harmonizing global clinical development regulations/standards
• Chinese NMPA speeds up clinical development process and opening up for global development
• Accelerated approval set up for innovative therapeutics that are marketed overseas
Finance:• China putting economic force behind the industry by building biotech parks, subsidies,
and incentives for biotechs to develop innovative products
• Chinese investors have raised significant capital to help the biotech boom both domestically and cross-borders
• HKEX open to pre-revenue biotechs, with recent success of Innovent, but also cautionary tales of others (Ascletis, Beigene)
Need for Therapeutics:• Growing patient population, especially related to cancer, where innovative therapeutics
are needed.
• China adds significant coverage of innovative therapeutics in the coveted National Reimbursement List (NRDL).
UBS 2018; ChinaBio 2018
5China Biotech Webinar December 2, 2019© Cello Health BioConsulting 2019
Push for Near Term Innovative Therapeutics has Driven Overall Deal Values to New Peaks While Total Upfronts have Decreased Suggesting a Hedge on Risks
BCIQ; *Note: Approved deals were changed to status of pharmaceutical product within deal; TDV = Total Deal Value; Total Upfront = includes upfront cash and equity.
1.01 Bn1.31 Bn
2.38 Bn
5.12 Bn
6.09 Bn
9.18 Bn
12.24 Bn
0.64 Bn0.15 Bn
1.21 Bn1.49 Bn
1.39 Bn
0.41 Bn
0 Bn
2 Bn
4 Bn
6 Bn
8 Bn
10 Bn
12 Bn
14 Bn
0
10
20
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2014 2015 2016 2017 2018 2019
Tota
l Dea
l Val
ue ($
Bn)
Tota
l No.
of D
eals
Total No. of Deals Distributed by Phase at Signing (n=295)
Expected No. of Deals
Undisclosed/NA
Marketed
Registered
Phase 3
Phase 2
Phase 1/2
Phase 1
Preclinical
Total Deal Value
Expected TDV
Total Upfront Value
25% growth in Total Deal Value estimated by end of Q4, 2019
Q1-
3Q
4
6China Biotech Webinar December 2, 2019© Cello Health BioConsulting 2019
Since Last Year, Oncology is 50% of China Deals, Driven by Interest in Innovative Therapeutics
1.01 Bn 1.26 Bn2.38 Bn
5.12 Bn
6.09 Bn
9.18 Bn
0.64 Bn0.15 Bn
1.21 Bn1.49 Bn 1.39 Bn
0.41 Bn
12.24 Bn
0 Bn
2 Bn
4 Bn
6 Bn
8 Bn
10 Bn
12 Bn
14 Bn
0
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2014 2015 2016 2017 2018 2019
Tota
l Dea
l Val
ue ($
Bn)
Tota
l No.
of D
eals
Total No. of Deals Distributed by Onco vs. Non-onco Deals (n=295)
Onco Non-onco Expected No. of Deals Total Deal Value (TDV) Total Upfront Value Expected TDV
BCIQ; *Note = Non-onco count also includes those deals where a therapeutic area wasn’t included/specified; Total Upfront = includes upfront cash and equity.
Year Top Oncology China Deal Upfront (USD)
Total (USD)
2014 Altor and Shenzhen Beike $4M $200M
2015 Eli Lilly and Innovent $56M $456M
2016 Aveo and Canbridge $1M $134M
2017 Valeant/Dendreon and Sanpower $820M $820M
2018 Zymeworks and Beigene (2 deals) $60M >$1B
2019 Abpro and Chiatai Tianqing Pharma N/A $4B
NEWS FLASH! Nov 1, 2019Major Oncology Deal by Beigene and Amgen
worth $2.7B
Q1-
3Q
4
7China Biotech Webinar December 2, 2019© Cello Health BioConsulting 2019
Unlike the Global Deal Trends, China Deals have Increased in Proportion of IO Deals to >50% in 2019
0.35 Bn 0.58 Bn 0.48 Bn
4.07 Bn
4.90 Bn
6.82 Bn
9.09 Bn
0 Bn
1 Bn
2 Bn
3 Bn
4 Bn
5 Bn
6 Bn
7 Bn
8 Bn
9 Bn
10 Bn
0
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45
2014 2015 2016 2017 2018 2019
Tota
l Dea
l Val
ue ($
Bn)
Tota
l No.
of D
eals
Total No. of Oncology Deals Distributed by IO vs. Non-IO Deals (n=130)
IO Non-IO Expected No. of Deals TDV Onc Expected TDV
BCIQ; CHBC Analysis.
Q1-
3Q
4
NEWS FLASH! Nov 1, 2019Major Oncology Deal by Beigene and Amgen
worth $2.7B, with IO assets as part of the deal
8China Biotech Webinar December 2, 2019© Cello Health BioConsulting 2019
Possibly China BioPharma Will Continue to Infuse Money into Oncology and Continue to Grow the Oncology Sector and Keep IO Top of Mind!
BCIQ; CHBC Analysis.
47
29
189
69
0
20
40
60
80
100
120
140
160
180
200
2018 2019
No.
of D
eals
2018-2019Q3 Oncology Licensing and M&A Deals by Region
China RoW
7% 14%13%
15%
47% 33%
33% 38%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2018 2019
% o
f Tot
al D
eals
2018-2019Q3 Oncology Licensing and M&A Deals by Regional IO vs. Non-IO(2018: n=236, 2019: n=98)
China IO China Non-IO RoW IO RoW Non-IO
CHINA
THE BOLD NEW PLAYER IN CANCER: HOW CHINESE BIOTECHS ARE FUELING THE ONCOLOGY SPACE
Weimin TangGlobal business Head
and Executive VP I-Mab BioPharma
Guillaume VignonSenior Vice President, Business Development
Beigene
Brad LoncarChief Executive Officer
Loncar Investments
Panelist:
Moderator:
James Lee, PhDAssociate Principal
Cello Health BioConsulting
Biotech Market Dynamicsin ChinaDecember 2019
The Birth of China Biotech
FIVE BIG THINGS!
All the right elements are coming together:
Loncar Biotech 11
Government Support1
Regulatory Reform2
Reimbursement3
Disruptive Science4
HK Stock Exchange and Shanghai Tech Board5
China’s government is backing the new economy.
Loncar Funds • Biotechnology-Focused ETFs 12
Regulatory Reform
Regulatory reform is having a BIG impact.
Loncar Biotech 13
• Joining ICH (harmonizing regulatory practices with FDA, EMA and Japan) in 2017 was a watershed moment.
• This puts Chinese drug developers on the same path as international companies.
• To develop a drug in China today now takes the same steps as developing a drug in the west.
Regulatory Reform
National Medical Products Administration (Formerly China FDA)
subsites.chinadaily.com.cn/nmpa/
• INDs are approved in 60 days by rule. Less than 10 years ago, this literally took up to 3 years.
• As of 2018, allowing clinical trial data from overseas multi-center trials for an application for registration.
• Established priority review and conditional approval (accelerated approval) programs similar to U.S. FDA.
Loncar Biotech14
Reimbursement Issues
National Reimbursement Drug List (NRDL)is Updated Frequently
Loncar Biotech 15
2001 2004 2009
2017 2018 2019
A Comparison — Biologics
Loncar Biotech 16
United States
8 of the top 10 selling drugs
2017 Global Sales = $104 billion
China
0 of the top 50 selling drugs
2017 Global Sales = $1.7 billion
The Birth of China Biotech
No Revenue?
No Problem!
Loncar Biotech 17
Hong Kong Biotech IPOs
RAISED PRICE SINCE IPO
$400M -76.2%
$111M -37.7%
$903M +11.3%
$421M +96.0%
$394M +32.4%
$1.01B +87.0%
$285M -6.3%
$161M +138.6%
$194M -2.7%
$205M +29.4%
$157M -24.7%
$1.0B +62.0%Loncar Biotech 18As of 11/29
Hong Kong Biotech IPOs
RAISED PRICE SINCE IPO
$410M -19.0%
$ 53M -2.8%
$223M -43.7%
Loncar Biotech 19
$589M +6.2%
$ 63M -21.7%
As of 11/29
2018’s Largest Biopharma IPOs
Loncar Biotech 20
$1.01B
$903M
$604M
$421M
$400M
$394M
$324M
$241M
$238M
$222M
1
RAISED
2
3
4
5
6
7
8
9
10
2019’s Largest Biopharma IPOs
Loncar Biotech 21
$2.90B
$1.00B
$505M
$390M
$349M
$345M
$285M
$276M
$410M
1
RAISED
2
3
4
5
6
7
8
9
10
$589M
Pipeline of Hong Kong Biotech IPOs
Loncar Biotech 22
04/08/2019
06/24/2019
07/15/2019
09/02/2019
CONTINENT PHARMACEUTICALS
FILING DATE
10/17/2019
Pipeline of Nasdaq Biotech IPOs
Loncar Biotech 23
10/29/2019
11/21/2019
FILING DATE
THE BOLD NEW PLAYER IN CANCER: HOW CHINESE BIOTECHS ARE FUELING THE ONCOLOGY SPACE
Weimin TangGlobal business Head
and Executive VP I-Mab BioPharma
Guillaume VignonSenior Vice President, Business Development
Beigene
Brad LoncarChief Executive Officer
Loncar Investments
Panelist:
Moderator:
James Lee, PhDAssociate Principal
Cello Health BioConsulting
REGISTER
The Biotech’s Conundrum in Immuno-Oncology Weighing
Hot Versus Cold Tumors, CPI-Naïve Versus CPI-Experienced
PatientsDecember 4th 11:30am-1pm ESTModerator:• Jeff Bockman, PhD, EVP, Oncology Practice, Cello Health BioConsulting
Panelists:• Mike Curran, PhD, Associate Professor, Immunology, MD Anderson• Emmett Schimdt, MD, Associate Vice President, Merck• Vanessa Lucey, PhD, Director, Cancer Research Institute• Steve Worland, PhD, President and CEO, eFFECTOR Therapeutics
Cello Health BioConsulting’s Next Insight Series Webinar:
REGISTER
Keynote Speakers:
Michael CurranAssociate Professor, Dept. of Immunology
Scientific Director, ORBIT PlatformThe University of Texas MD Anderson Cancer Center
Department of Immunology, Division of Basic Sciences
Stephan Grupp, MD, PhDDirector of the Cancer Immunotherapy Program
Director of Translational Research for the Center forChildhood Cancer Research at CHOP
Medical Director of the Stem Cell LaboratoryChildren’s Hospital of Philadelphia
Special Guest:
Ira MellmanVice President, Cancer Immunology
Genentech
Panels to Include:• Paradigm-shifting platforms IO & Non-
IO• Investing into Oncology: Who, What, &
Where?• Vaccines: From Paleo to Neo, Cancer
Vaccines in New Age of IO• Next Wave of Diagnostics, Including
Precision IO: Early and Smarter, The Better to Cure
• Advance Therapeutics ½ Day Session
Early Bird Code:EB2020