Sorrento Therapeutics ($SRNE) has wrapped up a $150 million private placement. The firm, which has come under pressure from activist shareholders in recent months, has earmarked the money for the advance of its pipeline and the continuation of its Asian partnership strategy.
Hong Kong-based healthcare investment house Ally Bridge Group led the round with support from Beijing Shijilongxin Investment and FREJOY Investment Management. Collectively, those three organizations accounted for $140 million of the placement. Yuhan, a South Korean pharmaceutical company, chipped in the remaining $10 million.
Adding Yuhan to the mix further expands Sorrento’s network of connections in Asia, a resource it plans to leverage as it goes about spending the $150 million.
“The completion of this significant financing despite the highly volatile and difficult U.S. biotech capital markets enables the development of our internal pipeline as well as the strengthening of Sorrento's partnership strategy for drug development in Asia and expanding it on a global basis,” Sorrento CEO Henry Ji said in a statement.
In the time since Sorrento first unveiled plans to raise the money, the company and Ji have come in for criticism from Wildcat Capital Management, a shareholder that accused executives of “looting” the business. Perceived secrecy around the $150 million private placement was one of the factors that prompted Wildcat to issue its criticism of Sorrento, which included the question: “Why does the company feel that it need not disclose to its shareholders important information concerning these transactions?” Shares in Sorrento are down more than 50% over the past 12 months.
Sorrento could conceivably regain some of that lost ground if some of the programs in its pipeline pay off. The company has four monoclonal antibodies partnered with Dr. Patrick Soon-Shiong’s NantKwest ($NK) in the clinic and a handful of in-house CAR-T programs.
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