Does plant “hematopoiesis” need to be regulated?
In July 2025, Wuhan Heyuan Biotechnology Co., Ltd. (hereinafter referred to as "Heyuan Biotech") successfully passed the review of the Science and Technology Innovation Board Listing Committee and was successfully registered. It became the first company to pass the review after the restart of the fifth set of standards on the Science and Technology Innovation Board, injecting a boost into the commercialization of its "rice-based blood production" technology.
However, just when the capital market was excited about it, Heyuan Biotech was caught in a regulatory dispute that concerns its survival. The Ministry of Agriculture and Rural Affairs clearly stated that Heyuan Biotech's large-scale planting of genetically modified rice without final safety certification did not meet the requirements of the "Regulations on the Safety Administration of Agricultural Genetically Modified Organisms". This dispute not only raised doubts in the market about the mass production prospects of its core product HY1001, but also placed the company's carefully constructed "plant molecular medicine" business model in a legal gray area.
When the innovative technology favored by the capital market hits the regulatory red line, how far can Heyuan Biotech's "blood production" path go?
A twenty-year long run from the laboratory to the Science and Technology Innovation Board
The story of Heyuan Biotech began in 2006. The company was founded by Professor Yang Daichang from the School of Life Sciences of Wuhan University. This molecular genetics expert, who had worked in institutions such as the Institute of Genetics of the Chinese Academy of Sciences, the International Rice Research Institute, and Ventria Bioscience in the United States for many years, returned to China to start a business with a subversive idea. He used rice as a "bioreactor" to produce human serum albumin for use in the biomedical field.
Yang Daichang's scientific research career can be traced back to the 1990s. His research in the field of rice endosperm-specific expression system laid the technological foundation for Heyuan Biotech. According to the company's prospectus, Yang Daichang began to prepare for the company in 2005 and officially established Heyuan Biotech in 2006. In the following more than a decade, he focused on the development of the "rice endosperm cell bioreactor platform". The core of this technological path is to introduce the human serum albumin gene into rice, making rice a "biological factory", and then preparing recombinant human serum albumin injection through extraction and purification.
After the technological breakthrough in the start-up period (2006 - 2017) and the clinical advancement in the industrialization exploration period (2018 - 2023), Heyuan Biotech finally saw the light. In May 2024, its core product, plant-derived recombinant human serum albumin injection (HY1001, trade name: Aofumin®), completed the Phase III clinical trial. It had good safety, and its efficacy was not inferior to that of human plasma albumin. In September of the same year, the New Drug Application (NDA) was accepted by the National Medical Products Administration and included in the priority review.
In July 2025, HY1001 was officially approved for marketing, becoming the world's first plant-derived recombinant human serum albumin drug. At the same time, HY1001 has also obtained the Phase III clinical trial license from the US FDA and is advancing its internationalization process.
This milestone was a crucial step for Heyuan Biotech in its transformation from a pure R & D company to a commercial one. The company has built a cGMP production line with an annual output of 10 tons of OsrHSA bulk solution in the Optics Valley Bio - City in Wuhan. In September 2024, it launched the "Recombinant Human Albumin Industrialization Base Construction Project" with a total investment of 1.909 billion yuan. It is planned to be put into production in the second quarter of 2026. By then, it will add an annual production capacity of 120 tons of bulk solution, with a total production capacity of 130 tons per year. Calculated according to the product specification of "10g/50ml", about 1 million injections can be produced from every 10 tons of bulk solution. After full production, it will have an annual production capacity of 13 million injections.
Heyuan Biotech's product pipeline is far more than just HY1001. The company has 8 candidate new drug pipelines under research, 6 of which are in the clinical research stage. Recombinant human lactoferrin lysozyme oral liquid (HY1002) for the treatment of acute viral diarrhea in children has completed the Phase II clinical trial and is planned to start the Phase III clinical trial by the end of 2025.
Plant-derived recombinant human α-1 antitrypsin injection (HY1003) for the treatment of the rare disease α-1 antitrypsin deficiency has completed the Phase I clinical trial in China and obtained FDA approval to conduct subsequent clinical trials in the United States. There are also products such as recombinant human serum albumin - long - acting growth hormone fusion protein injection (HY1004) in the early R & D stage. These products together constitute Heyuan Biotech's "plant molecular medicine" strategic layout.
The dispute over the "gray area" of genetically modified safety certification
However, the industrialization path of Heyuan Biotech is not smooth. The core of the dispute lies in the compliance issue of genetically modified rice planting. According to the "Regulations on the Safety Administration of Agricultural Genetically Modified Organisms", before the commercial planting of agricultural genetically modified organisms, they need to go through five stages: experimental research, intermediate test, environmental release, productive test, and finally obtain a safety certificate.
Heyuan Biotech is currently in the "productive test" stage and has been approved for a planting area of 5,180 mu. However, as of June - July 2025, the actual planting area has reached more than 9,000 mu, and these rice fields are mainly located in Xinjiang. According to the company's plan, the planting area will be expanded to 35,000 mu in 2027 to meet the raw material demand for an annual output of 120 tons of albumin. To meet the total production capacity of 130 tons per year in the future, the company needs a planting area of about 80,000 mu, which is equivalent to the cultivated land area of a medium - sized county.
The problem is that Heyuan Biotech claims that its "genetically modified rice for medicinal and industrial use" does not belong to traditional "agricultural genetically modified organisms", so industrialized planting does not require a safety certificate from the Ministry of Agriculture. The company believes that since the final product is a drug rather than food or feed and will not enter the food chain, it should be subject to a special regulatory path.
However, a staff member of the Science and Technology Department of the Ministry of Agriculture and Rural Affairs clearly stated that according to the current regulations, all genetically modified organisms planted in the fields, regardless of their use, must be included in unified supervision and must obtain the "Safety Certificate for Agricultural Genetically Modified Organisms (Production and Application)" before industrialized planting can be carried out. As of August 2025, Heyuan Biotech was still in the application stage for the safety certificate and had not been approved.
The essence of this dispute is a difference in legal interpretation. Article 82 of the "Regulations on the Safety Administration of Agricultural Genetically Modified Organisms" defines "agricultural genetically modified organisms" as "plants that use genetic engineering technology to change the genomic composition and are used for agricultural production or agricultural product processing...". Heyuan Biotech seizes on the expression "used for agricultural production or agricultural product processing" and believes that its medicinal purpose is not included. However, the Ministry of Agriculture believes that as long as it is planted in farmland, it constitutes an "agricultural production" activity and must undergo a biosafety assessment.
It is worth noting that although the Ministry of Agriculture has a clear attitude, as of August 2025, the regulatory authorities have not issued an official administrative penalty decision to Heyuan Biotech. This co - existence of "tough stance" and "lack of law enforcement" reflects the fuzzy area of the emerging field of "plant molecular medicine" in the current regulations. As a research report pointed out, "There are certain fuzzy areas in the existing legal framework for the emerging field of 'plant molecular medicine', which is the deep - seated reason for the dispute."
A commercial building with an unstable foundation
Although the regulatory authorities have not yet improved the supervision in the field of plant molecular medicine, Heyuan Biotech's mass production prospects and profit forecasts still highly depend on the safety certification issue of genetically modified rice. According to the company's plan, to meet the total production capacity of 130 tons per year, it needs a planting area of about 80,000 mu. However, if it fails to obtain the safety certificate from the Ministry of Agriculture, its commercial production will face significant compliance risks.
However, if Heyuan Biotech can resolve the relevant disputes, the company will develop a huge market. The market size of human serum albumin in China is expected to reach 42.5 billion yuan in 2025 (CAGR 10.5%), and as the world's first plant - derived product, HY1001 is expected to solve the problem of plasma dependence. Heyuan Biotech expects the sales of HY1001 to reach 444 million yuan in 2026 and increase to 1.567 - 2.194 billion yuan in 2030. The company plans to promote the product to be included in the national medical insurance in 2026 to accelerate market penetration.
In terms of technological advantages, Heyuan Biotech's production cost has dropped to 10 - 13 yuan per gram (the cost of plasma - derived products is 14 - 20 yuan per gram), and it can be reduced to 7 - 10 yuan per gram after the 120 - ton production line is put into operation, which has an obvious price advantage. However, the vulnerability of the company's profit forecast in the prospectus cannot be ignored.
In addition to the safety certification dispute, this forecast highly depends on three major assumptions: the rapid approval and listing of HY1001, its smooth inclusion in the medical insurance, and no major competition/centralized procurement impact. Although HY1001 has been approved for listing, there are still great uncertainties about whether it can be smoothly included in the medical insurance and whether there will be major competition/centralized procurement impact.
More importantly, the genetically modified safety certification dispute directly threatens the raw material supply. A research report points out that "Heyuan Biotech's current planting scale, although nominally within the framework of the 'productive test', its purpose and volume clearly point to large - scale raw material reserves for future industrial production." If the regulatory authorities insist on the safety certificate, the company may face the risk of raw material supply interruption, resulting in idle production capacity.
At the critical moment of the company's IPO, apart from the initial public offering, Heyuan Biotech cannot raise funds through other means for the time being, which increases the company's liquidity pressure. From 2022 to 2024, Heyuan Biotech's operating revenues were 13.3997 million yuan, 24.2641 million yuan, and 25.2161 million yuan respectively, but the company suffered losses of - 144 million yuan, - 187 million yuan, and - 151 million yuan respectively, with a cumulative loss of 851 million yuan. As of the end of 2024, the book balance of Heyuan Biotech's monetary funds was only 160 million yuan.
It is worth noting that Heyuan Biotech is not the only company facing such challenges. Ventria Bioscience in the United States, where its founder Yang Daichang once worked, also encountered regulatory problems due to a similar technological route. This shows that the regulatory framework in the field of "plant molecular medicine" has not been perfected globally, and enterprises need to explore compliance paths together with regulatory authorities.
Heyuan Biotech's "rice - based blood production" technology undoubtedly has innovative value, but its commercialization prospects are shrouded in the genetically modified safety certification dispute. In the case where the regulatory framework is not clear, the company's strategy of large - scale planting in the name of "productive test", although temporarily avoiding the risk of direct violation, places the industrialization prospects in great uncertainty. While investors focus on technological breakthroughs and market potential, they should be more vigilant about this "gray rhino" risk.
This article is from the WeChat official account "FUSE", author: Wu Wei, published by 36Kr with permission.