0205 ECP Overland
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Emerging Company Profile

Deals with Allogene, ADC reflect Overland’s ambition to tap parent Hillhouse’s network to bring innovation to China

Emerging Company Profile: Overland aims to bring innovative Western therapies to China

Backed by the deep pockets of private equity firm Hillhouse, Overland aims to leverage its parent firm’s biotech ecosystem in China to bring first-in-class and other innovative Western therapies to the country.

Feb 5, 2021 | 10:24 PM GMT

Backed by Hillhouse’s deep pockets, Overland aims to leverage its parent firm’s biopharma ecosystem in China to bring first-in-class and best-in-class Western therapies to the country.

Overland Pharmaceuticals launched in December by unveiling partnerships with platform companies ADC Therapeutics S.A. (NYSE:ADCT) and Allogene Therapeutics Inc. (NASDAQ:ALLO) and an executive team led by Hillhouse Capital Group venture partners Hua Mu, who is interim CEO and CMO of the newco, and Ed Zhang, who is COO and CBO.

While the start-up is not disclosing its funding, its parent firm is not short on cash.

Founded in 2005 by Lei Zhang, Hillhouse manages $80 billion in assets, investing globally across multiple sectors, including life sciences. Standout investments by the firm include Chinese biotech bellwether BeiGene Ltd. (NASDAQ:BGNE; HKEX:6160), online retailer JD.com and Tencent Holdings Ltd., the sprawling company behind WeChat, web portal QQ.com and countless video games.

Overland’s first deal established a joint venture with four cancer programs from Swiss biotech ADC Therapeutics.

The JV, Overland ADCT BioPharma (CY) Ltd., will develop and commercialize ADC Therapeutics’ loncastuximab tesirine (informally, “Lonca”), a humanized mAb against CD19 that is under FDA review with a decision expected by May 21, and three other pyrrolobenzodiazepine-based antibody-drug conjugates in Greater China and Singapore.

Overland invested $50 million in Overland ADCT, in which it will have a 51% stake. ADC Therapeutics will hold a 49% stake and is eligible for undisclosed milestones and royalties. The companies will have an equal number of members on the JV’s board.

What appealed to ADC Therapeutics, CEO Chris Martin said, was Overland’s ability to participate in the “life cycle development of Lonca and the portfolio development of our earlier-stage assets, and allowing us together to build an integrated biopharma company in China, with the aim ultimately of floating that on the Hong Kong exchange in some years.”

Announced a day after the ADC Therapeutics deal, Overland’s partnership with Allogene also centers on a JV. Allogene Overland plans to develop, manufacture and commercialize AlloCAR T therapies from Allogene, the new company from Kite veterans David Chang and Arie Belldegrun. The venture will have exclusive rights to specified Allogene candidates targeting BCMA, CD70, FLT3 and DLL3 in Greater China, Singapore, South Korea and Taiwan. Overland will invest $117 million, including an undisclosed upfront payment to Allogene and financial support to the JV’s operations.

Although Overland’s first two deals are JVs, Zhang stressed to BioCentury that the company is not solely focusing on joint ventures.

“We’re flexible about the structure,” said Zhang, who added that the company is planning licensing deals and is open to making equity investments in its partners. 

He said the JV structure was a particularly good fit for a platform company, as it allows the company to focus on finding the right partner rather than a series of licensing deals for mulitple assets. 

“With a JV structure, we can put all assets into a new company; we have a meaningful ownership [stake] and our interests are completely aligned,” said Zhang. Previously, he was VP of corporate development at Boston Pharmaceuticals Inc., whose business model focused on translational clinical development for programs that it in-licenses, and head of global BD of the renal strategic unit of Sanofi (Euronext:SAN; NASDAQ:SNY).

Mu is a veteran of Simcere Pharmaceutical Group Ltd. (HKEX:2096), where he was CSO and president of R&D and later president of Simcere’s U.S. unit; and WuXi AppTec Co. Ltd. (Shanghai:603259; HKEX:2359), where he was SVP and global head of product development service and partnership. He is also an alum of Hutchison China MediTech Ltd. (NASDAQ:HCM; LSE:HCM), the Genentech Inc. unit of Roche (SIX:ROG; OTCQX:RHHBY) and Biogen Inc. (NASDAQ:BIIB).

“You need to bring significant capital into this new company,” Zhang said. “At the same time, I think both companies need to work very closely — from manufacturing, production, to the development side as well.

Mu said that beyond the benefits for drug development, joint ventures such as this allow partners to “achieve a higher efficiency, good synergy, and mitigate the risk significantly, at the end of the day, to leverage both sides’ strengths and expertise to pursue expedited development.”

Mu said the deals reflect the type of innovative assets that will be the backbone of Overland’s portfolio, noting that Lonca is the most advanced pyrrolobenzodiazepine-based ADC. 

As with ADC Therapeutics, Overland began its relationship with Allogene in earnest at the 2020 J.P. Morgan Healthcare Conference, and the plan is for the JV to leverage Overland’s team and capabilities and Hillhouse’s network before building out the company with its own team and then eventually pursuing an IPO. 

The Hillhouse network includes portfolio companies Hangzhou Tigermed Consulting Co. Ltd. (SZSE:300347; HKEX:334), a CRO; Genor Biopharma Co. Ltd. (HKEX:6998) and WuXi AppTec, small molecule and biologics CMC service providers; Brilliance, a commercialization company that is majority-owned by Hillhouse; another majority-owned affiliate, Cowell Health, which is a drug distribution channel with more than 11,000 drug stores that is also a primary healthcare network. The firm also owns hospitals and KOL networks.

Although its first two deals are firmly in oncology, Overland is not planning to limit itself to cancer. Other areas of interest include hematology and autoimmune and cardiometabolic indications.

And while Hillhouse is providing key support and a network that Overland plans to leverage, Zhang said it’s their intent to be independent and build a “fully integrated biopharma company.” 

Overland Pharmaceuticals
Shanghai and Beijing, China, and Boston, Mass.
Technology: Antibody-drug conjugate, allogeneic cell therapy
Origin of technology: ADC Therapeutics S.A., Allogene Therapeutics Inc.
Disease focus: Cancer, autoimmune, cardiometabolic
Clinical status: Pivotal
Founded: 2020 by Hua Mu and Ed Zhang 
Academic collaborators: N/A
Corporate partners: ADC Therapeutics, Allogene 
Number of employees: 30-50
Funds raised: Undisclosed
Investors: Hillhouse Capital
CEO: Hua Mu (Interim)
Patents: Undisclosed

BCMA (TNFRSF17; CD269) – Tumor necrosis factor receptor superfamily member 17
CD70 (CD27L)
DLL3 – Delta like canonical Notch ligand 3
FLT3 (CD135) – FMS-like tyrosine kinase 3

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