Chinese drugmaker could partner with Abbott

Hutchison China MediTech, or Chi-Med, the pharmaceutical company controlled by Hong Kong billionaire Li Ka-shing, is looking for a partner this year for its experimental treatment for a bowel disorder--and rumor has it that Abbott Laboratories may be in the mix. Chi-Med, is "very aggressively working with everyone in the gastrointestinal space" on a licensing deal, CEO Christian Hogg tells Chicago's Daily Herald. Although Hogg declined to name potential partners, Abbott and Johnson & Johnson are among companies that sell products for ailments of the digestive tract. Neither company would comment on the rumor.

A partnership with Chi-Med would offer drugmakers a way to invest further in China, where the government plans to spend $125 billion to start a national health insurance system, according to the Herald. The company, which develops drugs based on traditional Chinese medicine and botanical ingredients, also distributes pharmaceuticals in China and sells consumer-health products.

In 2009, HMPL-004 returned encouraging Phase IIb results for ulcerative colitis, according to a March 4 earnings statement. The company is now in a position to out-license HMPL-004 to a global partner for continued Phase III development and commercialization. It also had three novel, small molecule drugs emerge from pre-clinical last year. HMPL-011 is a first-in-class drug for inflammation, that was approved to enter Phase I trials in Australia. HMPL-012 and HMPL-013 are two angiogenesis inhibiting oncology drugs that are currently under IND review by the China State Food and Drug Administration. The cancer treatment market in China is believed likely to become the largest in the world over the next 20 years, according to the company.

In addition, Chi-Med plans to spin off its drug-development business within two years. And it's attracting the attention from private equity and strategic investors. A MediPharma spinoff "is something we're deeply in discussions on now. It's more likely to be an IPO. We'd be quite unique in that we'd be the first biotech IPO out of China. I imagine we'd start that process in a year or two," Hogg tells the paper.

- read the earnings statement (.pdf)
- see the Herald's coverage