A Chinese billionaire with ties to New York”™s Rockefeller family and his globally diversified business group have invested in a Yonkers biotechnology company preparing to start clinical trials of its first infection-fighting drug.
The equity investment could mark the start of a long-term relationship between Hudson Valley enterprises and investors in China, said Steven C. Rockefeller and Chinese advisers who helped bring together the parties in the deal.
Shengda Zan, 50-year-old president of the Zongyi Group, traveled recently to the i.Park Hudson office and factory complex in downtown Yonkers to announce his company”™s $8.6 million investment in Contrafect Corp., a 5-year-old company developing drugs to treat life-threatening bacterial diseases and influenza. Zan has been appointed to the company”™s board of directors.
The investment is part of a $9.5 million financing that will fund the company”™s impending clinical drug trials, said Dr. Robert C. Nowinski, founder and CEO of Contrafect, at a press conference announcing the deal.
Nowinski informed shareholders in March that Contrafect has submitted to the U.S. Food and Drug Administration its investigational new drug application for CF-301, a recombinant protein used to treat Staphylococcal bloodstream infections. Drug-resistant Staphylococcus, or MRSA, is one of the most serious bacterial infections that threatens hospital patients.
“It”™s truly a unique opportunity,” he said of the Zongyi Group investment, “and it makes a very big difference at a critical time in our company”™s development.”
He said Contrafect with its new equity stakeholder will make future investments both here and in China. The relationship “will provide Contrafect unique access to China, the world”™s fastest and most important emerging market,” he said.
Started by Zan in 1987, the Zongyi Group focuses on clean energy and information technology businesses, strategic investments and asset management. The market value of the group”™s managed and invested assets exceeds $30 billion, according to the Hudson Valley Economic Development Corp., the New Windsor-based organization that helped facilitate the Contrafect deal.
The company in the last two years has invested in China”™s largest dairy enterprise and in property, casualty and life insurance companies. In the fourth quarter of 2012, Zan became the second-largest shareholder in China International Futures, the country”™s largest futures company, according to the Contrafect website.
Forbes magazine last month in its billionaires list put Zan”™s net worth at $1 billion. Forbes reported his wealth slipped in the last year as profits at his publicly traded company, Jiangsu Zongyi Corp., the Zongyi Group”™s core company, plunged 64 percent over the first three quarters of 2012.
A group subsidiary, Zongyi Solar America Co. Ltd., built and operates Tinton Falls Solar Farm, a 20-megawatt photovoltaic power plant on a 100-acre site in New Jersey”™s Monmouth County. Dr. Lawrence Yuan Tian, an adviser to Contrafect in the deal and founding chairman of the CIF.CO International Group, said Zan already has invested more than $100 million in the metropolitan New York and New Jersey region.
Tian said he first visited the Contrafect operation in Yonkers about a year ago with Steven C. Rockefeller Jr., chairman and CEO of Rose Rock Capital, the Rockefeller family company that is developing a finance investment center in Tianjin, China. A grandson of former New York Gov. Nelson A. Rockefeller, Rockefeller said he hopes to encourage more of “my friends and colleagues from China” to invest and partner in Hudson Valley enterprises that bring “win-win environmental and economic benefits” to the region.
Rockefeller in working this initial deal for the region was accompanied by Ned Sullivan, president of the environmental advocacy group Scenic Hudson.
Tian returned to Contrafect several months ago with Zan. “This is a very long road between a China investor and a U.S. biotech firm,” he said through a translator. “We hope that this is just a starting point for interest from China in this area and the Hudson Valley.”
In brief comments, Zan through a translator noted the speed with which the international deal was completed. “Our relationship with Contrafect, starting from dating to getting married, only took about five months,” he said.
Contrafect employs 35 workers at its 10.000-square-foot space in Yonkers and expects to increase to 50 employees “in the near future,” said Nowinski.
