Low-Cost Oral Cholera Vaccine for the World’s Poor
Onsite due diligence by the GHIF team – Glenn Rockman (L) and Christopher Egerton-Warburton (R)
August 27, 2014 (SEOUL): The Global Health Investment Fund I, LLC (GHIF) today announced that it has committed 5 million USD to support the final stages of product development for a new oral cholera vaccine (“OCV”) manufactured by EuBiologics Co., Ltd. (“EuB”), a Korean biopharmaceutical company focused on delivering vaccine products and contract manufacturing services to improve global public health. EuB is pursuing endorsement from the World Health Organization (“WHO”) for its new vaccine, Euvichol. If successful, Euvichol is poised to become the second WHO prequalified OCV suitable for use in the low- and middle-income countries where cholera still imposes a severe burden on public health and economic productivity.
The GHIF is a private investment fund structured by JPMorgan Chase & Co. and the Bill & Melinda Gates Foundation, which received anchor investments from Grand Challenges Canada (funded by the Government of Canada), the German Ministry for Economic Cooperation and Development (acting through KfW) and the Children’s Investment Fund Foundation. The GHIF’s mission is to finance late-stage drugs, vaccines and diagnostics for diseases that disproportionately burden low-income populations.
The Euvichol financing is the GHIF’s second investment, and it represents an innovative collaboration among an international consortium of public, private and non-profit organizations. The GHIF is investing in EuB alongside two traditional institutional investors in Seoul: the Korea-Seoul Life Science Fund (“KSLSF”) and Korea Investment Global Frontier Fund (“KIGFF”). KSLSF and KIGFF are adding to existing equity positions in EuB, which were established in 2013. Collectively, the GHIF, KSLSF and KIGFF are committing 7.5 million USD to EuB for this stage of the Euvichol project. This investment includes a senior secured loan for equipment purchases and a preferred equity investment to support the final clinical studies and regulatory preparations necessary to market Euvichol to public sector buyers world-wide.
The International Vaccine Institute (“IVI”), a non-profit organization devoted exclusively to developing and introducing new vaccines to protect the world’s poorest people, has played a pivotal role in the Euvichol project. The OCV technology used to manufacture Euvichol was specifically developed for use in developing countries through a public-private partnership led by IVI with support from the Republic of Korea, Sweden, and the Bill & Melinda Gates Foundation. IVI will continue to support EuB through the final steps of the clinical and regulatory process necessary to achieve WHO prequalification for Euvichol.
Thanks to this collaboration among these governments, non-profit organizations, traditional investors and the GHIF, EuB is planning to sell Euvichol at a target price of $1.00 per dose for public sector buyers when the vaccine is manufactured at scale—a commitment memorialized in a “Global Access Agreement” executed in connection with the current financing.This is 45% lower than the minimum price currently offered to public sector purchasers, and EuB’s annual manufacturing capacity will be as much as five-times greater than the current global supply. Expanding the available supply of high-quality, low-cost oral cholera vaccine will play an important role in increasing vaccination coverage to include those most at risk. Furthermore, Euvichol will eventually be sold in convenient, lightweight plastic tubes that are significantly easier to transport than the glass vial presentation that is currently in use. The plastic tube presentation also occupies less volume in the cold chain required to deliver the vaccine in resource-limited settings.
“The Euvichol project illustrates what can be accomplished when investors collaborate with government and non-profit partners around a clear public health objective that can be carried out in a sustainable manner by a traditional for-profit company,” says Glenn Rockman of the GHIF. “The GHIF is pleased to be supporting the expanded availability of an important global health vaccine alongside experts at IVI and EuBiologics. Euvichol has great potential to help prevent and control future cholera outbreaks, and we expect its availability will advance the GHIF mission by saving lives in low-income communities around the world.”
Although cholera is a preventable, treatable bacterial infection, the disease causes an estimated 100,000 to 120,000 annual deaths. Approximately 3 to 5 million fall ill from cholera each year, and the incidence is estimated to be greatest in children younger than age 5. As recent cholera outbreaks in places such as Ghana, the Philippines, Namibia, Haiti, Nepal, Cameroon, Nigeria and South Sudan continue to demonstrate, there is an urgent need to do more to protect vulnerable populations from this disease. Vaccination has an important role to play in the prevention and control of cholera in both endemic and epidemic settings, but historical use has been limited due to supply uncertainty and the cost of implementing cholera vaccination programs relative to the mortality of the disease. The current collaboration among the GHIF, IVI, EuBiologics and the company’s existing investors aims to change this.
“As a company focused on providing products and services specifically designed to improve global public health, we are thrilled to be adding the GHIF to our existing roster of investors and partners,” said Mr. Yeong-Ok Baik, CEO of EuBiologics. “The capital and technical expertise secured by this transaction ensures that we will have the resources necessary to execute upon the Euvichol development plan and deliver this vaccine to the communities where it is needed most.”
About Global Health Investment Fund I, LLC: Structured by JPMorgan Chase & Co. and the Bill & Melinda Gates Foundation, the GHIF is designed to provide financing to commercialize new and improved tools to fight challenges such as cholera, malaria, tuberculosis, HIV/AIDS and maternal and infant mortality in low-income countries. Benefiting from a partial guarantee from the Gates Foundation and the Swedish International Development Cooperation Agency, the GHIF received anchor investments from Grand Challenges Canada (funded by the Government of Canada), the German Ministry for Economic Cooperation and Development (acting through KfW) and the Children’s Investment Fund Foundation. Its limited partners also include a number of individual investors together with AXA, GlaxoSmithKline, the International Finance Corporation, JPMorgan Chase & Co., Merck, the Pfizer Foundation and Storebrand. The sponsors and partners of the GHIF believe that the Fund offers a novel opportunity to help bring about significant improvements in the treatment and prevention of disease and the reduction of maternal and child mortality, along with the prospect of a net financial return for investors.
LHGP Asset Management LLP, the London-based asset management arm of Lion’s Head Global Partners, authorized by the FCA, serves as Investment Manager for the GHIF.
About EuBiologics Co., Ltd.: EuBiologics Co., Ltd. is a privately-held Korean biopharmaceutical company providing contract research and manufacturing services to domestic and international clients, in addition to building a portfolio of vaccines designed to improve global public health. The company was established in March 2010 with the objective of becoming a preferred strategic partner providing solutions for the development and manufacturing of biopharmaceutical products. EuB’s facilities are designed to manufacture a variety of mammalian cell and microbe-derived, protein-based therapeutics and antibodies. It provides customized services for various stages of product development, including cell line development, GMP production, validation and regulatory support.
The company has also licensed the manufacturing technology necessary to produce an oral cholera vaccine from the International Vaccine Institute. In parallel with the development of its oral cholera vaccine product (“Euvichol”), EuBiologics is pursuing a number of other vaccines against diseases such as typhoid fever, HPV and norovirus.
The company’s administrative headquarters is in Seoul and its manufacturing facilities are located in a biotechnology cluster in Chuncheon, Korea. For additional information about the company, please visit http://www.eubiologics.com/ENG/.
About the International Vaccine Institute: The International Vaccine Institute is the world’s only international organization devoted exclusively to developing and introducing new and improved vaccines to protect the world’s poorest people, especially children in developing countries. Established in 1997, IVI operates as an independent international organization under a treaty signed by 35 countries and the World Health Organization. IVI conducts research in more than 20 countries of Asia, Africa and Latin America on vaccines against enteric and diarrheal infections, Japanese encephalitis, and dengue fever, and develops new and improved vaccines at its headquarters in Seoul, Republic of Korea. For more information, please visit http://www.ivi.int.
About the Korea-Seoul Life Science Fund: KSLSF is a cross-border venture capital fund that invests in innovative life sciences companies in Korea and the U.S. The Seoul Metropolitan Government of Korea served as the anchor LP in KSLSF which was formed in 2011. KSLSF believes that innovative life sciences companies can be found across different geographies that are connected partly through increasing mobility of talented entrepreneurs. In particular, KSLSF recognizes that cross-Pacific interplay is fast becoming a critical growth driver for the global life sciences industry. KSLSF’s unique investment strategy and operational model allow it to partake in this promising trend. KSLSF is co-managed by Hanwha Investment Corp. and Oxford Bioscience Partners (www.kslsfund.com) and has offices in Seoul and Boston.
About Korea Investment Global Frontier Fund: Korea Investment Global Frontier Fund is managed by Korea Investment Partners Co., Ltd. (“KIP”). KIP is a leading small- to mid-cap private equity firm headquartered in Seoul, Korea. KIP was established in 1986 and has 50 people working in offices in Seoul, Beijing and Shanghai today. KIP typically invests in biotechnology, mobile device components, software, distribution, electronic components, petro-chemistry and energy sectors and provides technological as well as business management consulting services to the portfolio companies. KIP’s fund management track record includes 25 venture funds, 6 corporate restructuring funds and a private equity fund, of which 14 funds are either in their investment or divestment stage. Unlike most peers, KIP has a dedicated team of Certified Public Accountants and in-house legal counsel responsible for risk and compliance management as well as professional consulting services for portfolio companies. Over the past 28 years, KIP has invested in more than 500 companies. KIP operates as a wholly owned subsidiary of Korea Investment Holdings Co., Ltd.
For additional information about KIP, please visit http://www.kipvc.com.