Sinovac Biotech Ltd. (Nasdaq: SVA) reports positive preliminary results of its Phase I/II clinical trial for CoronaVac, the company’s COVID-19 vaccine candidate. Recent results, according to the company, evidence favorable immunogenicity and safety profiles. The company is preparing to submit filings to commence Phase III protocol in China and Brazil via a partner. They recently raised $15 million in convertible debt for manufacturing capital. Based on other fundraising for global manufacturing, the amount seems low. The company has been embroiled in controversy with investors.
Sinovac first announced their COVID-19 inactivated vaccine initiative in January 2020 as the pathogen raged in Wuhan. The company leveraged established alliances and partnerships with leading Chinese academic medical centers and institutes. They first received approval to conduct clinical trials by China’s regulatory authority, the National Medical Products Administration (NMPA), on April 13.
Phase I/II Studies Evidence Promising Data
The recent Phase I/II studies, randomized, double-blind and placebo-controlled endeavors, included a total of 743 healthy volunteers aged 18 to 59 years old. A total of 143 are participating in the Phase I trial while 600 participate in the Phase II effort. According to the Chinese pharma sponsor’s disclosures, no severe adverse events have been reported in either the Phase I or Phase II studies. Sinovac reports that data coming out of the Phase II reveals that the investigational vaccine in fact induces neutralizing antibodies 14 days post vaccination treatment with a 0,14 day schedule. The purported neutralizing antibody seroconversion rate is 90%, which concludes the vaccine candidate can induce positive immune response.
New Regulatory Filings
Now Sinovac is on the move, submitting a Phase II clinical study report and a Phase III study protocol to China’s NMPA in the near future and commence application of Phase III clinical trials outside of China. In fact, TrialSite News recently covered Sinovac’s deal to supply Brazil with the vaccine, inking a collaborative deal with Instituto Butantan. Among other things, the partnership will sponsor a Phase III trial in Brazil. The company is publicly traded and seeks to share all relevant clinical trials data via academic publications.
Underlying Issues with this Company
The company’s Chairman, President and CEO recently emphasized the positive results, noting that the investigational product was “Safe and can induce immune response…” and that overall, Sinovac has met a critically important, and exciting milestone in the fight against COVID-19. Reporting that the company has “started to invest in building a manufacturing facility so we can maximize the number of doses available to protect people from COVID-19…” Mr. Weidong Yin went on to mention that they are thinking globally exemplified by the recent deal in Brazil. And they may need the help.
Recently securing $15 million via a convertible debt deal with Chinese and American investors raises some red flags. Based on the financial deals occurring with some other vaccine sponsors, the recent fund raise seemed low.
This fact must be understood in the context of the company’s actions to implement the rare “poison pill,” as reported by Reuters back in February 2019. Conflicts with disgruntled investors have led to one drama after another, from boardroom intrigue to unnamed officials raiding their factories! The company used investors 1Global Capital (engaged in litigation with the company), Chiangjia Li, and OrbiMed Advisors to trigger the poison pill, as combined they owned over 15 percent of the company stock.
The company is incorporated in Antigua while shareholder disputes for the company are governed in Delaware.
Founded in 1999, Sinovac Biotech Ltd. is a China-based biopharmaceutical company that focuses on the research, development, manufacturing and commercialization of vaccines that protect against human infectious diseases. Sinovac’s product portfolio includes vaccines against enterovirus71 (EV71), hepatitis A and B, seasonal influenza, H5N1 pandemic influenza (avian flu), H1N1 influenza (swine flu), varicella vaccine and mumps. Healive, the hepatitis A vaccine manufactured by the Company, has passed the assessment under WHO prequalification procedures in 2017. The EV71 vaccine, an innovative vaccine developed by Sinovac against hand foot and mouth disease caused by EV71, was commercialized in China in 2016. In 2009, Sinovac was the first company worldwide to receive approval for its H1N1 influenza vaccine, which it has supplied to the Chinese Government’s vaccination campaign and stockpiling program. The Company is also the only supplier of the H5N1 pandemic influenza vaccine to the government stockpiling program. The Company is developing a number of new products including a Sabin-strain inactivated polio vaccine, pneumococcal polysaccharides vaccine, a quadrivalent influenza vaccine and a SARS-CoV-2 (commonly referred to as COVID-19) vaccine. Sinovac primarily sells its vaccines in China, while also exploring growth opportunities in international markets. The Company is registering its products in over 30 countries outside of China.
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