Global private equity firm General Atlantic is investing $55 million in the first round to acquire a minority stake in Indonesia-based Kalbe Genexine Biologics (KGBio), according to a press statement.
The target company is the life sciences arm of the listed pharmaceutical company PT Kalbe Farma Tbk, which holds a 60% stake in the unit, according to a Q3 2020 financial report.
KGBio is also minority-owned by Genexine, South Korea’s listed clinical-stage biotechnology company, since 2016.
Following the recent investments by General Atlantic, KGBio is open to further collaborations with more partners in the future, said Kalbe Farma director and KGBio CEO Sie Djohan.
It is possible for General Atlantic to invest further in KGBio in the next two to three years as the firm’s ticket size is typically around $100-200 million in each investment, General Atlantic’s managing director Ashish Saboo said.
The investment will be used to support KGBio’s ongoing clinical development and commercialisation needs, asset acquisition plans, and production capacity expansion efforts.
The company intends to provide biological and biosimilar drugs in Southeast Asia. Biologicals is a key growth lever for the Kalbe Group, said Irawaty Setiady, president commissioner of Kalbe Farma.
Currently, KGBio is focusing on developing immuno-oncology or cancer immunotherapy with licences for two advanced clinical-stage biological drugs and one early, clinical-stage novel biological drug.
The two advanced-stage drugs are PD-1 Antibody (HLX10), which is being evaluated for the treatment of multiple tumor indications and chronic hepatitis B infections; and EPO hyFc (GX-E4), a novel long-acting erythropoietin-hybrid Fc fusion protein that is being evaluated in a phase III study for the treatment of anemia related to chronic kidney disease.
Meanwhile, the company’s CD73 Antibody (TJD5) is the rate-limiting enzyme that converts extracellular AMP to adenosine, a potent immunosuppressive molecule in the tumor micro-environment. This biological is being evaluated in a phase I study in combination with a monoclonal antibody medication Atezolizumab.
Currently, these drugs are not widely used in the Southeast Asia region due to their high costs. “We intend to lower the costs of these two molecules, so it could be used more by a lot of people,” Saboo told DealStreetAsia.
General Atlantic claims to be one of the world’s biggest investors in life sciences. In June 2020, the firm’s US-based life sciences portfolio Royalty Pharma conducted a Nasdaq IPO to raise around $2.2 billion. According to its website, General Atlantic has investments in 13 life sciences companies in the US, UK, Switzerland, Hong Kong, China, India, and Mexico.
Meanwhile, Kalbe Farma is the largest pharmaceutical group in Indonesia. Through KGBio, the group owns a biosimilar platform Innogene Kalbiotech and holds a controlling stake in Kalbio Global Medika, the biological manufacturing facility with bioreactor capacity for mammalian cell-lines.
KGBio noted Rp557.2 billion ($41 million) of total assets value before elimination, according to Kalbe Farma’s financial report in Q3 of 2020.
The company and its subsidiaries recorded revenue of around $12 million in 2020, and it expects to grow to a three-digit figure in the next three to four years.