JW Therapeutics Floats $300m Hong Kong IPO, Targets Chinas First CAR-T Approval

Chinese cell therapy developer JW Therapeutics has raised HK$2.325 billion (nearly $300 million) in an initial public offering (IPO) in Hong Kong, on Tuesday, to finance the firm’s efforts to obtain China’s first CAR-T product approval.

Shanghai-based JW Therapeutics sold 97.7 million shares at HK$23.8 apiece, the upper end of the proposed range of HK$20-23.8 ($2.6-3.1). The retail tranche of the share sale was oversubscribed 450 times.

JW Therapeutics was founded in 2016 under a partnership between Seattle-based biopharmaceutical firm Juno Therapeutics and Wuxi AppTec, a Shanghai-based contract medical researcher. The company has built an integrated platform focusing on the development, manufacturing, and commercialisation of cell-based immunotherapies for haematological cancers and solid tumours.

Its lead product candidate, relmacabtagene autoleucel (relma-cel), was in-licensed from Juno Therapeutics for mainland China, Hong Kong, and Macau. The product candidate is expected to be the first CAR-T therapy to be approved as a Category 1 biologics product in China.

In June 2020, China’s National Medical Products Administration (NMPA), the country’s regulatory body for drugs and medical devices, had accepted for review the firm’s New Drug Application (NDA) relating to relma-cel as a third-line treatment to diffuse large B-cell lymphoma (DLBCL).

JW Therapeutics’ $300 million IPO comes as the global CAR-T market expanded from about $13 million in 2017 to approximately $734 million in 2019, Frost & Sullivan cited in its prospectus.

Although there are currently no approved CAR-T products in China, the size of the country’s CAR-T market is projected to reach 600 million yuan ($90.5 million) by 2021 after the expected launch of new products, driven by an increasing number of patients diagnosed with cancer, growing affordability, and favourable regulatory environment, according to the US market researcher.

The IPO was supported by ten cornerstone investors, who subscribed to over 48.8 million shares, or about 50 per cent of the offered shares, and paid about $150 million. These investors included Rock Springs Capital, Hillhouse Capital, Loyal Valley Capital, and Temasek. This part of the shares has a lock-up period of six months.

The company had raised $100 million in a Series B round led by alternative asset manager CPE and South Korea’s Mirae Asset in June. In March 2018, the company had closed $90 million in a Series A round from investors including Temasek and Sequoia Capital China.

By far, JW Therapeutics has no products approved for commercial sale and have not generated any revenue from product sales. It recorded a loss of 650 million yuan ($98.2 million) in the first six months of 2020, compared to a loss of 357.9 million yuan ($54.1 million) in the same period in 2019, according to its prospectus.

“We expect to incur an increased amount of operating expenses for at least the next several years as we further our pre-clinical research, continue clinical development, seek regulatory approvals, manufacture drug candidates, launch pipeline products, and add the personnel necessary to operate our business,” said the firm.

JW Therapeutics will list its shares under the symbol “2126.HK.” Goldman Sachs and UBS were joint sponsors of the deal.