Biopharma Supply Chain Companies Surge in IPO Wave, Driven by Proprietary Technologies and Integrated Platforms

In recent days, the enthusiasm for biopharmaceutical supply chain companies in the capital market has been undeniably high.

On September 1, Biocytogen listed on the Main Board of the Hong Kong Stock Exchange, becoming the first publicly traded company specializing in gene editing, with a total market capitalization of HK$10.399 billion. As a biotechnology company in the market that possesses unique gene-editing technologies and generates revenue, Biocytogen’s scarcity is unquestionable. The following day, Aupaimed made its debut on the STAR Market of the Shanghai Stock Exchange. As the first domestically listed company focused on cell culture media, Aupaimed’s stock surged by nearly 70% on its first trading day, pushing its market capitalization above RMB 10 billion. Through this initial public offering, Aupaimed raised RMB 1.6 billion, which will be used for the commercial production of CDMO biologics, the cell culture R&D center project, and to supplement working capital.

Biopharmaceutical Supply Chain Companies Are Flocking to Capital Markets as Sector Heat Surges. VCBeat Analyzes the IPOs of Two Companies to Explore the Drivers and Trends Behind the Biopharmaceutical Supply Chain Boom.

The listings of Biocytogen and OPM Bio reflect a microcosm of the rising enthusiasm in the pharmaceutical industry chain over the past two years.

For a long time, China’s biopharmaceutical industry has been weak in innovation, relying primarily on fast-following and imitative innovation, with a lack of blockbuster innovative achievements. In the realms of pharmaceutical R&D and manufacturing, many core products have long faced “chokepoint” constraints, necessitating reliance on imports. The outbreak of the pandemic further exacerbated supply chain security concerns by prolonging international freight cycles. In recent years, as China’s biopharmaceutical sector and its supporting industries have gradually reached a turning point toward innovation, a large number of domestic enterprises have become willing to proactively engage local suppliers or, driven by cost pressures, consider import substitution. This trend has created opportunities for a surge in the import substitution of products within China’s pharmaceutical industry chain.

On the one hand,The outbreak of the COVID-19 pandemic and shifts in the international landscape have extended lead times for products required in pharmaceutical R&D and manufacturing, raising supply chain security concernsThis reality has been squarely placed before the industry. In the post-pandemic era, the procurement lead time for upstream raw materials and consumables in the biopharmaceutical sector has extended from approximately three months to nine months or even a year. Coupled with a highly volatile international landscape, pharmaceutical companies have developed a strong desire to seek domestic alternatives, thereby creating development opportunities for the upstream segment of China’s biopharmaceutical supply chain.

On the other hand, centralized volume-based procurement (VBP) by medical insurance has had a profound impact on China’s pharmaceutical industry. As VBP bidding becomes increasingly normalized, institutionalized, and expanded in scope,The cost pressure brought by centralized procurement is being transmitted upstream along the industrial chain, inevitably driving down costs.Biopharmaceutical companies are more motivated to choose high-quality, cost-effective domestically produced products to further reduce production and R&D costs.

Furthermore, after years of accumulation and development,The Innovation Capacity of China's Biopharmaceutical Industry Is Gradually Strengthening, with new discoveries, technologies, and fields continuously emerging, the advantages of domestic enterprises—such as lower costs, convenient communication, and stable supply—are driving the development of local Chinese supply chains, serving as another favorable factor for the pharmaceutical industry chain.

Policy, environmental, and technological advancements, coupled with market demand, are driving a surge in interest in China’s biopharmaceutical industry chain, leading a wave of companies in the sector to pursue initial public offerings (IPOs).

Looking back at the two companies going public this time. Biocytogen, founded in 2009, is a clinical-stage biotechnology and preclinical research services company, and a leading domestic provider of gene editing services, model organisms, and pharmacological efficacy evaluation services.

After six years of independent research and development, Biocytogen has pioneered a unique chromosome engineering technology, SUPCE, which overcomes the size limitations of gene-editing fragments. Building on this foundation,Development of the RenMice Platform for Fully Human Antibody Mice, establishing five major antibody technology platforms: fully human monoclonal antibodies, bispecific antibodies, bispecific antibody-drug conjugates (ADCs), GPCR antibodies, and TCR-like antibodies.Forming the core competitiveness of its antibody drug discovery platform.

Centered on the RenMice platform, the “Thousands of Mice, Tens of Thousands of Antibodies” initiative enables Biocytogen to conduct target validation and antibody drug discovery for over 1,000 potential novel drug targets. Leveraging the synergistic support of its five major technology platforms, the company achieves scalable, continuous output of innovative antibody molecules. To date, Biocytogen has advanced dozens of novel antibody drugs into preclinical studies and clinical trials through both in-house development and collaborative partnerships. In 2021, the company’s total annual revenue reached RMB 350 million, representing a nearly 40% increase compared to 2020. Notably, antibody development, as the primary revenue driver, grew by more than 100% from 2020 to 2021.

As a leading biopharmaceutical cell culture media company in China, OPM not only possesses independently developed patents and formulations, breaking the monopoly of foreign giants in the serum-free media sector, but has also rapidly captured the domestic market. Its self-developed cell culture media products, which serve antibody drug and vaccine production, offer both high quality and cost advantages.

Based on the foundation of culture medium process R&D and product optimization, the company has gradually builtCDMO Service Technology Platforms, Including Cell Line Development Platform and Transient Transfection Platform, through a business model that organically integrates culture media with CDMO services, it achieves import substitution by reducing antibody drug production costs with high-quality culture media, and empowers innovative drug development through a one-stop CDMO platform.

As can be seen,Both companies possess unique technologies in their respective fields and have further strengthened their competitive moats by building technology platforms, enabling them to stand out in industry competition.

In summary, from an external perspective, the growing strength of domestic biopharmaceutical companies in recent years, coupled with prolonged procurement cycles and supply chain security concerns amid the pandemic, as well as the upstream transmission of cost pressures driven by volume-based procurement (VBP), have created excellent development opportunities for the pharmaceutical industry chain. Internally, unique technological advantages and platform effects are key to establishing industry barriers and enhancing core competitiveness.

Looking further,The prosperity of the industrial chain has provided fertile ground for the development of biomedicine, with capital investment serving as an indispensable component.

From the IPOs of these two companies, we observe that they share the same early-stage VC investor: 3E Bioventures. As early as early 2018, 3E Bioventures invested in Biocytogen and Youhe Pharmaceuticals, subsequently making multiple follow-on investments that helped drive their public listings. In 2020, 3E Bioventures participated as an investor in the Series B financing round of OPM Biotech, supporting its efforts to build an ecosystem for the biopharmaceutical industry chain.

It is reported that,In addition to its investments in Biocytogen and OPM Biosciences, 3E Bioventures has also invested in several other companies across the pharmaceutical industry chain, including Huakan Biology, Kayak Biology, Jingyu Group, Dingchi Biology, and Jingcheng Pharmaceutical.Based on an analysis of limited public information, these companies tend toPossesses high technical barriers and platform advantages.

HuaKan Bio is dedicated to innovative 3D cell technologies. Leveraging the 3D microcarrier cell culture technology transferred from Professor Ya’nan Du’s research team at the School of Medicine, Tsinghua University, it has broken the long-standing import monopoly. The company currently serves over a hundred leading industry clients in fields such as stem cells, vaccines, gene therapy, and immunotherapy, and has established strategic partnerships with numerous medical institutions and research universities.

Core Products of HuaKan Bio3D TableTrix Microcarriers, is an independently developed microcarrier at the pharmaceutical excipient grade for cell-based drug development, and alsoThe only microcarrier globally to have simultaneously obtained dual regulatory approvals for pharmaceutical excipients from both the U.S. Food and Drug Administration (FDA) and China’s National Medical Products Administration (NMPA).As porous microspheres, their chemical and physical properties are precisely controllable, allowing for customized design of the cellular microenvironment based on cell types. Through specific lysis technology, 100% cell recovery can be achieved.

Kaijia Biologics is a provider of GMP-grade enzyme raw materials for the upstream segment of the biopharmaceutical and gene therapy industries. LeveragingSAMS (Structure-Aided Design and Multiplex Screening), an independently developed innovative platform for the R&D and production of functional recombinant proteins and antibodies,Kaijia Biologics has established stable business collaborations with more than 300 domestic and international companies specializing in innovative antibody drug development, cell therapy, gene therapy, and diagnostics, successfully facilitating the entry of multiple new drug products into clinical trials.

The strategic importance of upstream raw materials in new drug development is becoming increasingly significant. Kaikai Bio’s proprietary innovative platform for the R&D and production of functional recombinant proteins and antibodies addresses key challenges in the localization of supply chains within China’s biopharmaceutical industry. Having established itself as a well-known brand for antigen proteins in the market, the company is now experiencing rapid growth.

An analysis of these investments reveals that, in addition to funding innovative pharmaceuticals and cross-disciplinary medical devices and diagnostics, 3E Bioventures is also making systematic strategic arrangements across the biopharmaceutical industry chain. This approach is highly rational, as on one handSupply chain investments can help 3E Bioventures better empower its portfolio innovative companies., on the other hand,3E Bioventures has already made extensive strategic investments.Innovative and new drug companies can also become customers of these industrial chain companies.. It is understood that since its investment, 3E Bioventures has repeatedly facilitated collaborations between its portfolio pharmaceutical companies and Biocytogen, OPM, and Huakan.

From a macro perspective, amid increasing global instability and the normalization of the pandemic, coupled with rising domestic demand and technological upgrades, the next 3–5 years will witness rapid growth for biopharmaceutical companies. Enterprises across the pharmaceutical industry chain deserve close attention, with unique technologies and platform effects serving as the core drivers.