Karolinska Development secures life sciences funding from CP Group

12 November 2014

Swedish life sciences investor,  Karolinska Development has secured investments and declaration of interest in further investments from Thai conglomerate CP Group through its subsidiaries Sino Biopharmaceutical Limited, Chia Tai Resources Limited, Chia Tai Medicines Holding Limited.

Karolinska Development says the funding is intended to be used for the continued development and value creation in Karolinska Development’s portfolio companies. In addition, the company's position in negotiations with potential licensees and partners will be strengthened.

Karolinska Development AB has announced that:

  • the company will complete a private placement totaling SEK 63 million before issue costs to the leading Asian life science investor Sino Biopharmaceutical Limited, a member of the Charoen Pokphand Group (CP Group);
  • the Board of the company is considering an issue of convertible bonds of up to SEK 400 million, a substantial part of which is expected to be carried out as a rights issue;
  • the company has obtained a guarantee from Chia Tai Resources Limited, part of the CP Group, to subscribe for SEK 150 million in a potential future convertible bond issue, provided that such issue is made on certain terms, including that Chia Tai Resources Limited is actually allocated the full guaranteed amount of SEK 150 million, and provided that the convertible bond issue is approved at an Extraordinary General Meeting of the Company; and
  • Chia Tai Medicines Holding Limited, part of the CP Group, has declared an interest to invest up to approximately SEK 740 million in Karolinska Development’s portfolio companies. The goal is to make the first investment in early 2015 and invest the full amount within five years. The parties have entered into negotiations regarding the structure and terms of this cooperation.

Dr Bo Jesper Hansen, Chairman of Karolinska Development AB, commented, "The cooperation with CP Group will enable Karolinska Development to invest in innovations that address global unmet medical needs. Our contact surfaces with the Asian pharmaceutical industry will increase, which is of great importance in our mission of bringing innovative developments from Karolinska Development into this rapidly growing part of the world. We sincerely welcome CP Group as a new significant, strategic and long-term shareholder and are looking forward to expanding our relations even further in the future."

Tse Ping, Vice-Chairman of CP Group and Chairman of Sino Biopharmaceutical Limited, said, “I am very excited by the innovation culture of Sweden and the prolific pipeline of research emerging from the world-class research groups at Karolinska Institutet. Our group has a long tradition of entrepreneurial ventures in diverse global contexts and deep expertise in bringing technologies and innovations to market, through sustainable R&D and financing models that are suitable for the post-financial crisis economy. We are fully committed to developing a mutually beneficial and long-term strategic engagement in Karolinska Development AB and the wider Swedish healthcare system.”

Bruno Lucidi, CEO of Karolinska Development AB, added, “We recently announced a number of distinct changes in Karolinska Development's strategy and management structure. As part of my commitment to implement these changes, this announcement confirms an improved financial stability and enhances our ability to bring innovation to Asia. The new strategic and long-term shareholder firmly confirms the value of our portfolio companies and our mission to develop innovations for the benefit of patients worldwide. I will work diligently with our new investor to materialize the interest of CP Group to invest in the portfolio early next year.”

About CP Group

Not well known for its life sciences investment in Europe, the Charoen Pokphand Group (CP Group) is Thailand's largest private company, built from an agribusiness company by current chairman, Dhanin Chearavanont into a transnational conglomerate. It consists of three core businesses that operate in the agribusiness and food, retail and distribution, and the telecommunications industries with investment in 16 countries. Founded in 1921, the CP Group currently employs over 300,000 people with offices and factories located worldwide. Annual revenue for the CP Group for the year 2013 was USD 41 billion. Sino Biopharmaceutical Limited, part of the CP Group, is a pharmaceutical R&D and distribution company with a product sales network throughout China and first-class production facilities certified by the SFDA (State Food and Drug Administration). The company is listed on the Hong Kong Stock Exchange’s main board (Stock Code: 1177).


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