Benzinga | Dec 7, 2020 06:59AM EST

Sinovac Secures ~$500M in Funding for COVID-19 Vaccine Development

Sinovac Biotech Ltd. ("Sinovac" or the "Company") (NASDAQ:SVA) today announced that Sinovac Life Sciences Co., Ltd. ("Sinovac LS") (formerly known as Sinovac Research and Development Co., Ltd.), a subsidiary of Sinovac, has secured approximately US$500 million in funding for further development, capacity expansion and manufacturing of the CoronaVac, its COVID-19 vaccine candidate, as well as conduct other development and operational activities. The investor, Sino Biopharmaceutical Limited, a leading innovative research and development driven pharmaceutical conglomerate in China, through affiliates, has invested approximately US$500 million in exchange for approximately 15% of the total equity interest of Sinovac LS.

"We have made significant progress in the development of our COVID-19 vaccine candidate CoronaVac, which has reached critical milestones in clinical trials in Asia and Latin America," said Mr. Weidong Yin, Chairman, President and CEO of Sinovac. "In addition to funding the CoronaVac, this new strategic partnership with Sino Biopharmaceutical Limited further enables us to improve our vaccine sales capabilities, expand in Asia markets, develop and access new technologies, and most importantly, accelerate our efforts to help combat the global pandemic."

Prior to the investment announced today, each of Advantech Capital and Vivo Capital exercised its right to convert its convertible loan previously announced by the Company on May 22, 2020 into 7.5% of the total equity interests of Sinovac LS, which after the investment now represents an approximately 6.3% stake in Sinovac LS.

Phase III clinical trials for CoronaVac have been approved in Brazil, Indonesia, Turkey and Chile. In China, the phase I/II trials were conducted with results showing the vaccine candidate can induce neutralizing antibodies among over 90% of volunteers who received two doses of vaccination in both adults and the elderly. The results of the Company's phase I/II clinical trial on healthy adults aged 18-59 years old were published on Lancet Infectious Diseases on November 17, 2020.

Sinovac expects to be able to manufacture 300 million doses annually and aims to complete the construction of a second production facility by the end of 2020 to increase the annual production capacity of CoronaVac to 600 million doses. Depending on market conditions and the availability of financing, the Company may in the future seek to further expand its production capacity.

Houlihan Lokey served as financial advisor, and Han Kun Law Offices and Latham & Watkins LLP served as legal advisors to the Company in connection with the transaction.