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on august 30, industry insiders found that the registration information of shanghai zanrong pharmaceutical technology co., ltd. showed that the company was in the process of announcing its creditors and resolving to dissolve. the health bureau learned that as early as august 2, shanghai zanrong pharmaceutical had completed the filing of the liquidation group, indicating that the cancellation and dissolution was the company's own initiative.

in may last year, shanghai zanrong pharmaceuticals won the favor of roche, a multinational pharmaceutical company.the company pocketed nearly 5 billion yuan in down payments and milestone payments, but filed for dissolution in just over a year., and was therefore interpreted negatively by the market.

industry insiders said that the dissolution was just a reorganization of the company's internal resources, and it might be possible to set up a branch in another location later. however, such an adjustment by a biotech that just raised 5 billion yuan has undoubtedly further tightened the nerves of the innovative drug market.

a lucky guy with plenty of money

in 2018, shanghai zanrong pharmaceuticals was established in zhangjiang, shanghai, and its headquarters was set up in hong kong. in order to expand its internal r&d capabilities,the following year, a subsidiary, suzhou zanrong pharmaceutical, was established. this dissolution only involved the shanghai branch.

the three companies in shanghai, hong kong and suzhou are all managed and operated by the same scientific team. founder, chairman and ceo cheng ziqiang and co-founder and chief scientific officer zhou ding are old acquaintances. they both worked at glaxosmithkline and made outstanding contributions in the field of drug metabolism and pharmacokinetics (dmpk).

based on their understanding of dmpk, zanrong pharmaceuticals chose to make a big move in the her2 field, which was second only to pd-1 in terms of r&d involution.the r&d team of only 5 people selected the company's "signature" drug zn-a-1041, laying the groundwork for its subsequent highlight period.

in 2018, zanrong pharmaceuticals received a $3 million angel round of financing from taifu capital and mifang health fund. subsequently, qiming venture partners, sherpa investment, and juming venture capital invested in the company, and the company received nearly $40 million in hot money, an amount that made a number of start-ups engaged in small molecule innovative tumor drugs envious. two years later, by 2020, the team size had expanded from 5 to 15 people.

in just 26 months, shanghai zanrong pharmaceuticals advanced zn-a-1041 to ind in both china and the united states, which shows its r&d capabilities.

in july 2021, zanrong's company value reached a new level:under the care of world-renowned investment institution orbimed capital, it led the completion of a $40 million series b financing round.it should be noted that orbimed capital mainly focuses on the pre-ipo and cornerstone products of very scarce pipeline biopharmaceuticals. among the pharmaceutical companies invested in the past 10 years, 53 have been listed, including kangfang biopharma, burning rock medical, etc.

just three years after its establishment, it received nearly 500 million yuan in capital injection from chinese and foreign investment institutions, creating a phenomenal performance in the biotech industry. however, there has been no news of financing from orbimed capital since then.it was not until may 9 last year when the news of the cooperation between zanrong pharmaceuticals and roche was announced that the company returned to the public eye.

if the pace of capital inflow is maintained, it will not be difficult for zanrong pharmaceutical to be listed on the hong kong, shanghai or new york stock exchange in the future. however, shanghai zanrong will not see this day.

biotech is not easy to survive

the "star" player was in a hurry to reorganize after receiving 5 billion yuan. the industry speculated that zanrong pharmaceutical's main research and development focus would be transferred to suzhou zanrong pharmaceutical, but the official has not yet given a clear response to this.

the only thing that is clear is the direction of the "only seedling" zn-a-1041, this drug is a her2 small molecule inhibitor. unlike many products on the market, this drug has a high blood-brain barrier permeability. in terms of clinical needs, nearly 30%-50% of breast cancer patients are at risk of brain metastasis, but due to the existence of the blood-brain barrier, there is currently no standard treatment drug on the market, so there is market potential.

biotech cannot escape bd fate, which is the main way to generate revenue. in the licensing cooperation between the company and roche, the latter will pay$70 million in upfront and near-term milestone payments, plus up to $610 million in development and commercialization milestone payments, and future tiered profits based on global annual net sales.

there are also some uncertainties in the days of waiting for the payment in batches. for example, there is no accurate result in the patent case of zn-a-1041. previously, the core patents of zn-a-1041 all fell within the protection scope of the patent of the listed drug her2 inhibitor tucatinib, and the clinical trials and re-examinations were rejected by the fda. after roche took over, whether it can realize the potential of the drug with the advantages of a large manufacturer still needs time to prove.

in addition, zanrong pharmaceuticals has few cards that can be cashed in. among the five pipelines under development,the remaining four tumor gene and dna damage repair mechanism pipelines are in the preclinical stage.

in 2021, zanrong pharmaceuticals began planning to advance clinical trials and hopes to include one project in clinical research each year, but the official has not publicly disclosed progress for a long time.

the investment logic of the capital market has changed. industry insiders said that in the current investment environment, investors' exit channels are not smooth, and many late-stage projects have "gone to waste", not to mention early-stage new projects.among the companies delving into early-stage drug discovery, zanrong pharmaceuticals is undoubtedly a lucky one, and the elimination competition in the downstream biotech sector will only be more brutal.according to incomplete statistics, since january this year, nearly 10 pharmaceutical-related companies have pressed the "pause button" on ipo.

written by miaomiao

editor: jiang yunjiating

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illustration｜visual china