Sinclair Pharma PLC Prospectus Filed Following Huadong Medicine's £169 Million Acquisition Bid to Expand Hyaluronic Acid Portfolio

VCBeat (WeChat: vcbeat) has learned that on August 29, Huadong Medicine Co., Ltd. (hereinafter referred to as “Huadong Medicine”) announced that on the 28th, the company signed a binding offer agreement with Sinclair Pharma plc, proposing to acquire all shares of Sinclair through a cash offer.

The cash tender offer was formally made by Huadong Medicine, which proposes to implement the acquisition through its wholly-owned subsidiary, Huadong Medicine Aesthetic Investment (Hong Kong) Co., Ltd., as the acquiring entity, in cash.The total amount is £169 million.(approximately RMB 1.49 billion).

Sinclair is a specialized company focused on the field of medical aesthetics products, with business covering the entire industry chain from R&D, production to sales. It has more than 200 employees, and its core products includeBeauty threads, long-acting microspheres, hyaluronic acid, etc., create brand influence through differentiated product portfolios.

The Company’s products have obtained certifications and market access approvals in major global markets. It conducts direct sales in countries and regions including Western Europe, the United States, Brazil, and South Korea, and distributes its products worldwide through distributors, covering more than 50 countries and regions globally. In 2017, it achieved sales revenue of £45.3 million (approximatelyRMB 400 million), representing a year-on-year increase of approximately 20%.

According to available information, Huadong Medicine is primarily engaged in the production and sales of active pharmaceutical ingredients (APIs) and formulations for both chemical and traditional Chinese medicines, as well as the distribution of proprietary Chinese and Western medicines, Chinese herbal materials, medical devices, and health products. It is a large-scale comprehensive pharmaceutical enterprise integrating pharmaceutical R&D, drug manufacturing, wholesale and retail operations, pharmaceutical e-commerce, pharmaceutical logistics, and the health industry.

The 2018 semi-annual report shows that Huadong Medicine achieved operating revenue of RMB 15.325 billion, a year-on-year increase of 8.76%; net profit attributable to shareholders of the parent company was RMB 1.293 billion, a year-on-year increase of 24.19%; and net profit attributable to shareholders of the parent company after deducting non-recurring gains and losses was RMB 1.269 billion, a year-on-year increase of 23.06%.

Data indicates that Huadong Medicine holds a product portfolio spanning four major therapeutic areas: diabetes, super antibiotics, oncology, and immunosuppressants. The pace of import substitution for its core product, acarbose, is gradually accelerating, with substantial growth potential in the primary healthcare sector. Bailing Capsules demonstrate significant potential for cross-departmental expansion, with expectations of substantial volume growth in both the primary healthcare market and the OTC segment. Immunosuppressants continue to experience rapid growth, driven by adjustments to the National Reimbursement Drug List (NRDL) and the removal of indication restrictions. New products, including indobufen and daptomycin, benefit from a favorable competitive landscape and large market size, positioning them for rapid volume expansion. Overall, key product lines are sustaining robust growth.

Furthermore, Huadong Medicine continues to increase its investment in the medical aesthetics sector. Its controlling subsidiary, Huadong Ningbo Pharmaceutical Co., Ltd., is a leading enterprise in the domestic sales of medical aesthetic products, serving as the national general distributor for LG Chem’s hyaluronic acid (brand name:Yiwan) experienced rapid growth, achieving nearly RMB 700 million in sales revenue in 2017, and accumulated certain market operation and promotion experience in the medical aesthetics field.

GF Securities believes that Yvoire, distributed by Huadong Medicine’s Ningbo subsidiary, is currently in a phase of rapid growth; however, its product portfolio remains relatively limited. A successful acquisition of Sinclair would be expected toExpand the Product PortfolioThis acquisition is conducive to Huadong Medicine’s establishment of a global medical aesthetics business platform, aligning with its strategy for international development and continuous expansion into the medical aesthetics sector.

It has been learned that Huadong Medicine has successively established two U.S. offices to facilitate cooperation negotiations with overseas targets and the research, introduction, and licensing of new drug projects.