Hansoh Pharmaceutical Debuts on HKEX with Market Cap Surpassing HK$100 Billion

Hansoh Pharma, China’s largest pharmaceutical company specializing in mental health disorders, has officially listed on the Hong Kong Stock Exchange. Based on its pricing of HK$14.26 per share, Hansoh Pharma’s stock opened 14.31% higher today. As of press time, its share price stood at HK$20.80, representing a surge of 26.09%, with its total market capitalization exceeding the trillion-yuan mark to reach HK$118.683 billion.

According to the prospectus, Hansoh Pharma aims to raise up to US$1.001 billion (approximately HK$7.86 billion) in this offering. To date, it has secured 10 cornerstone investors, including Hillhouse Capital, Boyu Capital, and GIC Private Limited. Reportedly, approximately 551 million new shares will be issued, with 93% allocated for international placement and 7% for the Hong Kong public offering. The shares issued in this offering will represent 9.7% of the enlarged share capital. Of the proceeds raised, 45% will be invested in the research and development of innovative drugs and generic drugs, 25% will be used for the construction of production facilities, and the remaining 20% will be allocated to sales and academic promotion.

According to Blue Whale Business reporters, Hansoh Pharma, established in 1995, operates through its entity Jiangsu Hengrui Medicine Group (hereinafter referred to as “Hansoh Pharma”), primarily focusing on four major therapeutic areas: central nervous system, oncology, anti-infectives, and diabetes. Additionally, it has expanded into the gastrointestinal and cardiovascular treatment fields. Currently, the company has established five major R&D platforms, including a compound design and screening platform, a pharmacology and toxicology research platform, a pharmaceutical research platform, and a clinical research platform. The company possesses various proprietary technologies, has undertaken more than 20 national-level projects such as the “Major New Drug Creation” National Science and Technology Major Project, and holds 119 key patents in China.

Overview of Hansoh Pharma's Key Products

Currently, Hansoh Pharma has nearly 100 drugs in its pipeline, including six Class 1.1 novel molecular entity innovative drugs that have entered Phase II clinical trials or later stages. According to Hansoh Pharma’s plan, it will launch nearly 30 investigational drugs between 2019 and 2020, among which 15 possess high growth potential, including four Class 1.1 innovative drugs and eight generic drugs with first-to-file potential.

Hansoh Pharma's Partial R&D Pipeline

According to the prospectus, Hansoh Pharma generated revenues of RMB 5.433 billion, RMB 6.186 billion, and RMB 7.722 billion in 2016, 2017, and 2018, respectively, with corresponding net profits of RMB 1.476 billion, RMB 1.596 billion, and RMB 1.903 billion. Furthermore, from 2016 to 2018, Hansoh Pharma’s gross profit margins stood at 92.6%, 92.7%, and 92.6%, respectively, while its net profit margins were 28.7%, 27.2%, and 25.8%.

Blue Whale Finance reporters noted that since the new policy was implemented in May, the Hong Kong Stock Exchange has welcomed a total of 11 biopharmaceutical companies listing on its board, including Ascletis Pharma-B (01672.HK), BeiGene-B (06160.HK), Hua Medicine-B (02552.HK), Innovent Biologics-B (01801.HK), WuXi AppTec (02359.HK), Junshi Biosciences-B (01877.HK), CStone Pharmaceuticals-B (02616.HK), CanSino Biologics-B (06185.HK), Viva Biotech (01873.HK), Frontage Holdings (01521.HK), and Mabpharm-B (02181.HK).

However, based on the listing performance of various companies, listed enterprises have experienced varying degrees of decline in their stock prices. To some extent, the stock prices of biotechnology companies listed in Hong Kong are under pressure. Nevertheless, many biotechnology firms remain undeterred by the risk of breaking the issue price, and their enthusiasm for listing in Hong Kong remains undiminished. Industry insiders told Blue Whale Finance reporters that Hansoh Pharma’s listing performance will significantly boost the confidence of biotechnology companies on the Hong Kong Stock Exchange.

(Editor:Wang Xing）

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