[Edaily Reporter Na Eun-kyung] #Orum Therapeutics, a developer of targeted protein degradation (TPD)-based antibody-degradator conjugates (DACs), is establishing a base of operations in Shanghai, China.

On the surface, this move is intended to establish China as a preclinical development hub, following the company’s headquarters in Daejeon, South Korea, and its Boston, U.S., office. However, some in the biotech industry interpret this as part of an open innovation strategy to directly enter China’s biotech ecosystem—which has recently emerged as a global hub for innovation in antibody-drug conjugates (ADCs)—and identify next-generation candidate compounds and technologies.

Seeking to Hire Management Staff for Local CRO in Shanghai

According to Orum Therapeutics on the 10th, the company plans to establish a branch office in Shanghai, China.

An Orum Therapeutics official stated, “We are moving forward with plans to establish a branch office in China,” adding, “To this end, we are making the necessary preparations, including hiring a Contract Research Organization (CRO) manager locally.”

Currently, Orum Therapeutics operates primarily through its headquarters in Daejeon, South Korea, and its Boston, U.S., office. The Daejeon office handles research and development (R&D), while the Boston office manages global clinical trials and business development (BD). With the addition of the Shanghai office, it is expected to oversee preclinical research and collaboration with external research institutions within China.

To this end, Orum Therapeutics has recently begun recruiting a Preclinical Pharmacology and External Scientific Operations Lead to be based in Shanghai, China. This individual will serve as a liaison between the research teams in Boston, USA, and Daejeon, South Korea, as well as non-clinical CROs in China.

Specifically, the role will involve identifying and managing CROs, overseeing efficacy and toxicity testing, conducting pharmacokinetic (PK) studies, and responding to GLP and GMP audits, as well as establishing partnerships with external institutions, identifying new payloads, securing AI-based drug design capabilities, and supporting platform expansion. In particular, the individual is expected to actively work to build a collaborative network with research institutions and biotech companies in China.

Recently, there has been a growing trend in the global biotech industry to utilize China not merely as a production base or sales market, but as a research and development hub. This is because China possesses an environment capable of rapidly conducting efficacy and toxicity evaluations of new drug candidates, supported by a large-scale CRO industry, a abundant research workforce, and robust R&D infrastructure.

In fact, in next-generation modality fields such as ADCs, bispecific antibodies, and TPDs, there has been a significant increase in cases where Chinese CROs are utilized to secure preclinical data. Shanghai, in particular, is regarded as one of China’s largest biotech clusters, home to major CROs and contract development and manufacturing organizations (CDMOs)—including WuXi AppTec—as well as numerous biotech companies.

An industry insider stated, “The growth of major CROs, including WuXi AppTec, has been a key factor behind China’s rise as a biotech powerhouse,” adding, “While price competitiveness was a strength in the past, the quality of research personnel and technological capabilities have now reached the highest global standards.”

Will China Become Orum Therapeutics’ Open Innovation Outpost?

Furthermore, there are expectations that Orum Therapeutics’ Shanghai hub will play a role that goes beyond simply supporting preclinical research for its existing DAC pipeline.

Currently, none of the new drug candidates in Orum Therapeutics’ in-house pipeline are in the clinical stage. Development of ORM-5029, which was undergoing Phase 1 clinical trials in the U.S., has been discontinued, and the company’s core assets are now considered to be next-generation DAC candidates in the preclinical stage, such as ORM-1153. ORM-6151 was sold to Bristol-Myers Squibb (BMS) in 2023, and BMS is currently leading its clinical development. For this reason, the Shanghai hub is also expected to focus on preclinical research functions—such as candidate discovery and efficacy and toxicity evaluations—rather than clinical development for the time being.

In particular, the biotech industry is paying close attention to the possibility that Orum Therapeutics will utilize Shanghai as a strategic hub for collaboration with Chinese biotech companies and the discovery of new assets. Recently, in the global ADC market, candidate compounds developed by Chinese biotech companies have accounted for a significant portion of major technology transfer agreements. This is because innovative technologies originating from China are rapidly increasing in both the TPD and ADC fields. Since DAC is a platform that combines ADC’s target-directed delivery technology with TPD’s protein degradation technology, networking with Chinese biotech companies—which are leaders in ADC and TPD—could directly lead to the discovery of next-generation DAC candidates and new payloads.

In 2023, global pharmaceutical company BMS acquired Izabatamab, an EGFRxHER3 bispecific antibody ADC developed by China’s SystImmune, in a deal valued at up to $8.4 billion (approximately 12.8 trillion won). GlaxoSmithKline (GSK) secured HanSo Pharmaceutical’s B7-H4 ADC, HS-20089, last year for up to $1.7 billion (approximately 2.6 trillion won).

Pfizer is also leveraging Chinese biotech companies as key suppliers of innovative new drugs, as evidenced by its signing of a licensing agreement this year with China’s 3S Bio for the PD-1/VEGF bispecific antibody SSGJ-707, valued at up to $6 billion (approximately 9.15 trillion won). In the biotech industry, there is speculation that, as global Big Pharma companies have begun to utilize China as a source of next-generation modalities, Orum Therapeutics is also seeking to identify promising ADC and TPD candidates early on and explore collaboration opportunities through its Shanghai base.

Orum Therapeutics is also reportedly using funds secured from successful technology exports to companies such as BMS and Vertex to expand its next-generation DAC platform and identify new programs. As of the end of the first quarter of this year, Orum Therapeutics held approximately 2750억 won in liquid assets—comprising cash, cash equivalents, and other current financial assets—providing the company with sufficient capital to pursue the acquisition of promising candidate technologies or strategic investments in the future. This is why observers believe the Shanghai hub can serve not only as a center for preclinical research on the existing pipeline but also as a gateway for validating local Chinese technologies and candidate compounds.

A biotech industry insider stated, “China is no longer merely a production base but has become one of the central hubs of global biotech innovation,” adding, “Numerous promising early-stage technologies and candidate compounds are emerging in the ADC and TPD fields as well.”

The source continued, “Orum Therapeutics’ decision to establish a direct local presence appears to go beyond simply conducting preclinical work; it likely also aims to collaborate with Chinese biotech companies and identify promising assets,” adding, “It is highly likely to serve as a forward base for directly validating candidate compounds on-site and determining whether to pursue joint research or technology licensing.”