A Powerful Alliance Formed to Focus on the Development of New Oral Interferon-free Combined Therapy for Hepatitis C

On 30 October 2016, YiChang HEC ChangJiang Pharmaceutical Co., Ltd. (“HEC”, stock code: 01558.HK) entered into a cooperation agreement with TaiGen Biopharmaceuticals CO.(Beijing), Ltd. (“TaiGen Biopharmaceuticals (Beijing)”) and its controlling shareholder TaiGen Biopharmaceuticals Holdings Ltd (“TaiGen Biopharmaceuticals Holdings”), pursuant to which the parties agreed to establish a joint venture in China to focus on the research, development, production and sales of new anti-Hepatitis C drugs. This collaboration is launched by the leading pharmaceutical companies on both sides of the Taiwan Strait, aiming at probing into the Direct-acting Antiviral Agents (DAAs), an innovative therapy for Hepatitis C. Upon its establishment, the joint venture will be held by HEC as to 51% and by TaiGen Biopharmaceuticals (Beijing) as to 49%, and therefore will become a subsidiary of HEC.

At present, methods applied for Hepatitis C treatment inChinastill rely upon the traditional therapy using interferon plus ribavirin. However, the huge market of Hepatitis C is a medical blue ocean that cannot be ignored by any pharmaceutical manufacturer. According to the World Health Organization’s recent estimates, the world’s prevalence rate of Hepatitis C stands at approximately 3%, i.e., approximately 185 million people around the globe are suffering from HCV, and approximately 350,000 people die of Hepatitis C and its complications each year. It is estimated that the number of Hepatitis C virus carriers inChinaexceeds 40 million. As Hepatitis C screening efforts have been strengthened across the country in recent years, the number of Hepatitis C cases reported inChinaeach year is on the rise. According to the epidemic report on legal infectious diseases released by the Chinese Center for Disease Control and Prevention, 138,059 cases of Hepatitis C diseases were reported for the eight months from the beginning of 2016 to August 2016 alone.

In view of such an attractive market prospect, HEC has been an early mover since inception. HEC obtained the clinical approval documents for Yimitasvir, one of its brand-new NS5A inhibitor in November 2011, and has completed the relevant Phase I clinical trial. In addition, Furaprevir, developed by TaiGen, has demonstrated its remarkable drug properties among patients during its Phase II clinical trial conducted inTaiwan. Through HEC’s powerful combination with TaiGen Biopharmaceuticals (Beijing), Yimitasvir, which developed by HEC, and Furaprevir, a Hepatitis C NS3/4A protease inhibitor developed by TaiGen Biopharmaceuticals (Beijing), are expected to be combined to develop a new oral interferon-free combined therapy for Hepatitis C, so as to provide domestic patients with more effective solutions for Hepatitis C treatment while capitalising on the first-mover market opportunities. This collaboration will allow the Company to get access to TaiGen’s extensive experience in clinical trial in China, and will strengthen the joint venture’s leading position in the Chinese Hepatitis C market by drawing upon the complementary advantages of both parties, so as to achieve mutual benefits and help HEC to create its new era in the Hepatitis C treatment market.

Since its establishment, HEC has been positioning itself as a leading pharmaceutical enterprise in the world and has made remarkable progress in various fields including anti-virus and treatment of endocrine, metabolic and cardiovascular diseases. HEC has also outperformed its domestic peers in the research and development of drugs for the treatment of Hepatitis C. HEC’s research and development strength can be evidenced by the fact that HEC’s Yimitasvir Phosphate has been selected to be included in the latest list of drugs to be reviewed with priority announced by the Centre for Drug Evaluation (CDE) of China Food and Drug Administration (CFDA) on 28 October 2016.

TaiGen Biopharmaceuticals (Beijing) is a wholly-owned subsidiary of TaiGen Biopharmaceuticals Holdings, and is responsible for the clinical trials and registration of new drugs in MainlandChina.  Known for its high efficiency in innovation, research and development capabilities, the company is a product-oriented innovative pharmaceutical company mainly engaged in the research and development of drugs. It has accumulated a wealth of research and development experience during the course of its independent research and development of various drugs such as Burixafor (TG-0054), a new stem cell driver, and Nemonoxacin, a new anti-bacterial infection drug. In addition, in the field of Hepatitis C treatment, Furaprevir, a new anti-Hepatitis C virus drug developed by the company, has completed its Phase I/II clinical trials inTaiwanand theUnited States, and obtained qualifications for China CFDA’s priority review in April 2016. It is expected that the approval for clinical trial inChinawill be granted in August 2016.

After CFDA’s verification of information on the large-scale clinical trial in Mainland China in July 2015, Nemonoxacin (Tai Jie Xin (太捷信)) which was developed by TaiGen has become the first drug granted with the new drug certificate under Category 1.1 among enterprises at home and abroad, and has been considered as a blockbuster drug. TaiGen’s Furaprevir obtained qualifications for CFDA’s priority review in this April, and TaiGen has become the one and the only Taiwan-based new drug research and development company among the merely seven companies which have obtained such qualifications. Thanks to TaiGen’s extensive experience in new drug research and development and clinical trials in China, and given that both Yimitasvir Phosphate and Furaprevir have obtained qualifications for CFDA’s priority review, the application for approval in relation to the new drugs of the joint venture in China will be facilitated by the advantages of the parties.