BeiGene has struck a definitive agreement with Guangzhou Development District to build a commercial-scale biologics manufacturing facility in Guangzhou, Guangdong Province, China.
The joint venture, BeiGene Biologics, will finance the research and development of biologic drug candidates in China. The joint venture will invest a total of $330 million. Of which, about $30 million will be from BeiGene HK and $150 million from the district's Guangzhou GET Technology Development unit, making the two firms a cash equity investment in the JV and a shareholder loan. The JV also plans to apply a $150 million loan.
"It is our strategic priority to secure high-quality large-scale manufacturing capacity based on the increasing biologics opportunity we envision in China and global markets," John Oyler, BeiGene's co-founder, said.
BeiGene has been growing fast, paying particular attention on oncology. It has established a staff of over 200 working on four cancer therapies. The biotech's lead drug is a BTK inhibitor, which is now in the clinic, as well as a PD-1 inhibitor and a BRAF inhibitor. It also has a PARP inhibitor under development and is expected to compete with AstraZeneca's Lynparza and other drugmakers that have PARP's in late-stage development such as Tesaro and Pfizer's Medivation. BeiGene also works together with Merck KGaA.
Fierce Pharma noted Matthew Harrison, an analyst from Morgan Stanley, saying that the portfolio could create over $1 billion of sales in China alone.
Meanwhile, the Administrative Committee of Guangzhou Municipal Government and Guangzhou Development District said they believe that BeiGene Biologics will transform GDD into a hub for biopharma innovation. They further assured that BeiGene will receive the government's strong support, particularly in terms of funding, management service, and creation of a good business environment.
The BeiGene Biologics joint venture announcement came just over a week after Lonza and Sanofi also revealed their plan to invest $288 million to build a large-scale biologics manufacturing plant in Switzerland.