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Here's Why BeiGene Rose 23.4% in July

By Maxx Chatsko - Updated Aug 4, 2018 at 6:05PM

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A slew of investor updates last month added about $2 billion to the company's market cap.

What happened

Shares of BeiGene (BGNE 0.44%) jumped over 23% last month, according to data provided by S&P Global Market Intelligence, after the company announced updates for three separate drug candidates. That pushed the Chinese biopharma's market cap past $10 billion for the first time in history, although it has since fallen back into the $9 billion range.

Furthermore, investors were looking forward to the company's initial public offering in Hong Kong -- the first secondary listing of its kind under new rules -- scheduled for early August. The international IPO wrapped up on Aug. 2, with the Chinese company raising $903 million to fund development activities for its budding pipeline.

A businessman drawing a yellow step chart with a positive gain.

Image source: Getty Images.

So what

China is making a massive push to grow its bioeconomy -- biopharma, agricultural biotech, and industrial biotech, among other fledgling markets -- and BeiGene is taking its role as ambassador very seriously. At the end of March, the company announced it had enrolled more than 2,300 patients in over 30 clinical trials worldwide. Recent announcements support its leadership position in the global industry.

In July, BeiGene announced clinical and regulatory updates for three separate late-stage drug candidates. First, it told investors it planned to pursue accelerated approval of zanubrutinib as a treatment for Waldenstrom macroglobulinemia, a type of non-Hodgkin lymphoma, in the United States. It's currently enrolled in a global phase 3 trial and has already received fast-track designation from the U.S. Food and Drug Administration. 

Second, the biopharma announced preliminary top-line results for tislelizumab in Hodgkin's Lymphoma, although the phase 2 study, which is being conducted in China, is arguably too young to yield results. It's also a single-arm study, which may not provide enough statistical power to prove the drug's safety and efficacy. Nonetheless, BeiGene expects to file for approval in China by the end of 2018. 

Third, BeiGene announced it initiated a phase 3 trial of tislelizumab combined with chemotherapy as a first-line treatment for non-squamous non-small cell lung cancer, also in China.

That was all followed up by a secondary listing in Hong Kong, which is working hard to compete with the Nasdaq exchange in the United States for biopharma listings. The company raised $903 million in the secondary IPO, which bolstered its cash position of $1.48 billion at the end of March.

Now what

BeiGene is clearly well funded, supported by a robust pipeline of drug candidates, and wields legitimacy by owning the right to market a basket of Celgene blockbusters in China. Investors may want to pay special attention to the clinical trials being conducted specifically for the Chinese market, as they appear to be rushed or not up to the regulatory standards of the United States or European Union. Nonetheless, a healthy number of global clinical trials -- which must be designed to stricter standards of quality -- are also underway. Simply put, this company's under-the-radar market opportunity should earn it a place on your biopharma watchlist.

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