A share 'domestic nine-price HPV vaccine first share' IPO today, how will set off the phenomenon of the new changes in the market?

On March 15, Kangle Guard, which is committed to developing recombinant protein vaccine, was listed on the Beijing Stock Exchange, becoming the "first domestic nine-valent HPV vaccine share".

Before the listing, as one of the domestic nine-valent HPV vaccine manufacturers with the fastest development, Kangle Guard's every move has attracted considerable attention, and it is also a star project in the primary market. It has received angel round investment from Sirius Group, an industrial investor, and Shenzhen Venture Capital, a famous domestic VC.

Since its establishment in 2008, Kconnguard has taken the design of vaccine antigen structure as its core technology and built a technology platform for the whole process of vaccine development from antigen structure design, recombinant protein expression, vaccine engineering, pilot production and efficacy evaluation, and has three expression systems of Escherichia coli, yeast cells and CHO cells. Ten recombinant human vaccines have been developed, covering a variety of viruses to which humans are susceptible.

Among them, the trivalent HPV vaccine, the nine-valent HPV vaccine (female indication) and the nine-valent HPV vaccine (male indication) developed by Kangle Guard have entered the phase III clinical research stage, while the 15-valent HPV vaccine has obtained the clinical trial approval notice from the State Food and Drug Administration. Other types of recombinant vaccines, such as polyvalent norovirus vaccine, respiratory syncytial virus vaccine and herpes zoster virus vaccine, have also entered the key stage of pre-clinical research.

It is understood that Kangle Guard plans to take the IPO as an opportunity to further strengthen the development and commercialization of HPV vaccine. Since 2025, Kangle Guard will gradually complete the commercialization of all types of HPV vaccines in development.

The nine-valent HPV vaccine remains elusive

Since its first product hit the market in 2006, the HPV vaccine has long been in short supply.

HPV vaccine is undoubtedly a rare phenomenon in the field of biotechnology products, where it has attracted the attention of women around the world. From GSK's CERVARIX®, to Merck's GARDASIL®, GARDASIL®, and Gardasil ®9, HPV vaccines have exploded almost immediately.

In fact, HPV vaccine technology has evolved fast enough than most biotechnologies, and product iterations have remained rapid. So far, only 5 HPV vaccines have been marketed globally. In addition to imported HPV vaccines such as CERVARIX®, GARDASIL®, GARDASIL®9, etc., a batch of domestic HPV vaccines have been marketed to fill their slots. For example, Wantai Biological's bivalent HPV vaccine Xinkenin ®, Watson biological subsidiary Shanghai Zerun bivalent HPV vaccine Wozehui ®, for women of appropriate age to provide more diverse options.

However, the new products never kept up with the expansion in demand. For HPV vaccine developers around the world, this is a sweet burden. Take, for example, the coveted nine-valent HPV vaccine, which Merck pioneered and became a huge commercial success. According to its most recent annual report, Merck posted significant global growth in 2022, with sales of its cervical cancer vaccine Gardasil®/Gardasil®9 at $6.897 billion, up 22% from the previous year, driven by increased demand outside the United States, particularly in China.

HPV vaccine such a huge market vacancy, naturally attracted a large number of powerful companies to invest heavily in the development of related products. In Korea alone, there are 20 HPV vaccines under clinical study by the end of 2022. Among them, there are three bivalent vaccines, one trivalent vaccine, five quadvalent vaccines, one six-valent vaccine, six nine-valent vaccines, and one 11-valent vaccine, one 14-valent vaccine, one 15-valent vaccine and one 17-valent vaccine. The research and development competition is very fierce.

Among them, Kangle Guard, Reke Biological, Wantai Biological, Watson Biological, Bowei Biological and other 5 are hot nine-valent HPV vaccine research and development of rapid progress of enterprises, their related research and development pipelines have entered the phase III clinical trial stage. However, according to the data disclosed by each company, it will be around 2026 at the soonest before the nine-valent HPV vaccine developed by these domestic companies will enter the market one after another.

The reason behind this is that before an HPV vaccine is launched, there are many thorny problems to be solved, including the long research and development cycle of HPV vaccine products, high requirements of production technology, approval and sales are highly regulated, all of which are challenges. Any HPV vaccine manufacturer needs to go through a long process of development and optimization before it can consistently export a safe and effective HPV vaccine.

Kangle Guard is one of the earliest companies in the layout of HPV vaccine industrialization technology in China. The early founders of the company, Professor Chen Xiaojiang, Professor Liu Yongjiang, Professor Ma Runlin, are classmates, focusing on structural biology. Among them, Professor Chen Xiaojiang is a world-renowned structural biologist, he is the first scientist in the world to analyze the three-dimensional structure of HPV virus, and on this basis, the three students completed a breakthrough in the efficient expression of HPV pentamer protein in Escherichia coli, which laid the foundation for the company to develop HPV vaccine.

According to the prospectus, more than half of Recreation Guardian's employees are in research and development, and the company's investment in HPV vaccine development has increased over the years. After more than 10 years of development, Connoll Guardian has built a diversified technology platform based on the core papillomavirus capsid protein patents, including structure-based antigen design technology platform, genetic engineering and protein expression technology platform, vaccine engineering technology platform and recombinant vaccine efficacy evaluation technology platform. It is these platforms, Through the HPV vaccine design, development and mass production of many key links.

For example, most of the engineered HPV virus capsid proteins are folded incorrectly, thus unable to produce specific protective antibodies against HPV virus. Even though virus-like particles can be folded correctly through the steps of inclusion body purification and protein renaturation, the renaturation process is complex and the protein yield is low.

Based on the three-dimensional structure of HPVL1 virus-like particles, on the premise of effectively preserving the immunogenicity of L1 virus-like particles, Krecreation Guardian makes the amino acid sequence of L1 protein truncated and modified, so that it mainly exists in the form of correctly folded soluble L1 pentamer during the process of expression and purification. At the same time, this process also reduces the formation of L1 chaotic polymers, reduces the difficulty of the purification of L1 protein, helps to improve the purification yield and yield, avoids the stability defects of L1 virus-like particles caused by the degradation of L1 terminal amino acid residues, and improves the product quality of HPV vaccine.

For another example, although a small amount of HPV virus capsid proteins expressed by Escherichia coli exist in correctly folded soluble pentamers, it is difficult to capture them from the cell crushing solution. Recreation Guard changes the regulatory elements of HPV capsid protein expression vectors at the structural level and optimizes the coding sequence to achieve a high level of soluble expression of this protein in Escherichia coli. In addition to reducing the complexity of the process, low yield and other problems were solved.

Permeability is less than 5%,

How big is the HPV market?

Even today, the global HPV vaccine market is still a blue ocean.

Of all the viruses associated with cancer, the pathogenicity of human papillomavirus, or HPV, has been well studied. A large number of data demonstrate the relationship between HPV infection and cervical cancer, vaginal cancer, vulva cancer, penile cancer, anal cancer, oropharyngeal cancer and other head and neck cancer, genital warts and other serious diseases.

For example, 99 percent of cervical cancer cases, 88 percent of anal cancer cases and 77 percent of vaginal cancer cases in the country were found to be related to HPV infection, according to Frost&Sullivan. In the United States, HPV infection is responsible for 99 percent of cervical cancer, 91 percent of anal cancer and 75 percent of vaginal cancer.

Among them, cervical cancer has been a notorious killer of women's health. According to the World Health Organization, cervical cancer is the second most malignant cancer among women aged 15-44 years. In 2020, there will be more than 600,000 new cases of cervical cancer worldwide, with 340,000 deaths. For a long time, countries have been exploring various ways to eliminate cervical cancer.

In November 2020, the World Health Organization released the Global Strategy to Accelerate the Elimination of Cervical Cancer, setting a target of 90% of girls being fully vaccinated against HPV by the age of 15 by 2030. By the end of 2020, 110 countries and territories around the world have included HPV vaccines in their routine national immunization programmes.

Since the launch of the HPV vaccine, the global HPV vaccine market has expanded rapidly due to increasing HPV vaccination rates in developed countries and the introduction of HPV vaccination programs in developing countries.

According to Frost&Sullivan's statistics, from 2016 to 2020, the global HPV vaccine market grew from 2.26 billion US dollars to 4.22 billion US dollars, with a compound annual growth rate of 16.2%. Driven by the increase of HPV vaccine penetration in low - and middle-income countries and the expansion of vaccination to the male age group, The global HPV vaccine market is expected to reach $10.52 billion in 2025 and $16.82 billion in 2031.

Domestically, the HPV market is growing even more dramatically. From 2017 to 2020, the market size of HPV vaccine in China increased from 940 million yuan to 13.56 billion yuan, with a compound annual growth rate of 143.43%, much higher than that of the global market. According to Frost&Sullivan's statistics, in 2020, among the 315 million eligible women in China, the cumulative HPV vaccination rate was only 3.61%, and in 2017, the figure was even 0.15%.

The very low penetration rate provides enough growth space for domestic HPV vaccine enterprises.

At present, in the domestic HPV vaccine market, the HPV vaccine supplied by Merck still occupies a dominant position, accounting for more than 90% of the market share. With the continuous development of local HPV vaccines in China, there is an obvious trend of domestic substitution for imported HPV vaccines. It is expected that several HPV vaccines will complete clinical trials and apply for marketing in the next 5 years. Compared with imported HPV vaccines, domestic varieties are more cost-effective and can effectively compete with them.

According to the clinical data published by Recreation Guard, Recreation Guard's nine-valent HPV vaccine demonstrated similar safety and efficacy in head-to-head trials with GARDASIL®9 and GARDASIL®.

It is worth noting that currently approved HPV vaccine products in China are mainly targeted at female indications, but HPV vaccine has significant preventive effect on female diseases caused by HPV infection, and also provides protection against some male cancers and lesions caused by HPV infection. Given that HPV infection is predominantly sexually transmitted, promoting HPV vaccination among age-appropriate males could help achieve the WHO global strategy to accelerate the elimination of cervical cancer. In the regulatory guidance documents issued by WHO and some developed countries, it has been recommended that HPV vaccination for the male population of appropriate age can be considered after meeting the vaccination needs of the main target population. Countries such as the UK, Canada and Ireland have included adolescent male HPV vaccination in their national immunization programmes.

As of today's IPO, the nine-valent HPV vaccine (male indication) developed by Kangle Guardian has completed phase I clinical trials and initiated Phase III clinical trials. After the market will be mainly used to prevent HPV high-risk virus infection in men caused by anal cancer, genital cancer and condyloma and other diseases. There are 344 million Chinese men between the age of 9 and 45, so the domestic market space is huge. Kangle Guard's nine-valent HPV vaccine is the first domestic HPV vaccine into the male indication phase III key protective efficacy clinical study, the vaccine once launched will occupy the male market opportunity, combined with the female market will set off the phenomenon of the new market reform.

Diversified pipeline layout

In addition to HPV vaccine, on the self-built core technology platform, Connoll Guardian has also developed recombinant polyvalent norovirus vaccine, recombinant respiratory syncytial virus vaccine and other novel biological vaccines covering a variety of highly pathogenic viruses.

Among them, the recombinant polyvalent norovirus vaccine developed by Connolleguard based on genetic engineering technology, using yeast expression system, has basically completed the pilot process research of the vaccine, and is preparing for pilot production process development. It is expected to submit IND application for recombinant polyvalent norovirus vaccine in 2023.

Norovirus sickens about 685 million people worldwide each year, including about 200 million infections in children under five, and kills about 35,000 children, according to Frost&Sullivan. The burden of disease caused by norovirus infection fully highlights the necessity of developing prevention and treatment drugs. However, there is no vaccine or specific antiviral drugs for norovirus in the market at present, and non-drug interventions are mainly used for prevention and control of norovirus.

In addition, respiratory syncytial virus (RespiratorySyncytialVirus, RSV) infection may lead to severe respiratory symptoms, such as capillary bronchitis, pneumonia, laryngitis, bronchitis and asthma, etc., are children, the elderly and people with poor immunity easily infected with the virus. According to statistics, more than 95% of children over the age of 2 have been infected with RSV. Globally, RSV infection is one of the leading causes of death among children between the ages of 1 month and 1 year, second only to malaria. RSV infection in the elderly often leads to exacerbation of obstructive pulmonary disease with cardiopulmonary complications. Clinically, Palivizumab and Ribavirin are prescribed for the treatment of severe illness caused by RSV infection. No RSV vaccine has been approved worldwide.

Based on the three-dimensional structure of the pre-fusion conformation of RSV F protein, Connoll Guard designed and recombinant the key antigen domain to prepare a recombinant RSV vaccine candidate. If the Recreation Guard RSV vaccine is successfully developed, it will effectively reduce the disease burden caused by RSV infection. In 2023, Recreation Guard is expected to complete preclinical studies and submit applications for clinical trials.

Meanwhile, the recombinant herpes zoster vaccine, the recombinant polyvalent hand, foot and mouth disease vaccine, and the recombinant polio vaccine developed by Recreation Guardian are planning to submit IND applications in 2023.

In addition, the fifteenvalent HPV vaccine program, developed in collaboration with Cheng Da Bio, covers all 13 high-risk types of HPV identified by the World Health Organization's International Agency for Research on Cancer (IARC) as scientific consensus. Compared with the nine-valent HPV vaccine, the 15-valent HPV vaccine can increase cervical cancer prevention coverage from 90% to more than 96%, further reducing the potential disease burden of HPV infection, and has been approved for clinical trials.

Industrialization. According to reports, the construction of Krecreation Guardian's recombinant vaccine clinical and industrial base in Kunming, Yunnan Province, has begun in early 2021. In this base, Kangle Guard plans to invest 1.1 billion yuan to build production workshops for recombinant HPV trivalent and nine-valent vaccines, recombinant polyvalent norovirus vaccines and other recombinant vaccines, so as to provide stable large-scale production capacity for subsequent recombinant vaccines after completion of commercialization.

While actively distributing the domestic market in a differentiated way, Kangle Guardian has also launched an international strategy for HPV vaccine. It is understood that in 2021, Krecreation Guard reached a formal cooperation agreement with Russian pharmaceutical group on the development and commercialization of nine-valent HPV vaccine in Russia. At the same time, it maintains effective communication with Bill & Melinda Gates Foundation and PATH, and actively responds to WHO's HPV vaccine international procurement plan.

From the invention patent of HPV capsid protein preparation to the first strand of domestic nine-valent HPV vaccine, Kangle Guard has completed the first stage of laying the foundation in 15 years. With the launch of core products one after another, we look forward to biotechnology companies including Kangle Guard to provide more and better solutions for human health.