HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Thematic (Sector/Industry)

<ul>
<li>Both generic drugs and innovative drugs are facing the problem of “shortened life cycle” in China, pushing pharmaceutical companies to optimize product mix and find some shortcut, such as license-in.</li>
<li>However, it has been more and more difficult to in-license cost-effective products, indicating that the afterwards commercialization could be hard to cover the license-in cost or make decent profits.. </li>
<li>A way out is to <strong>reshape the development path</strong> after license-in by relying on strong R&amp;D systems, so as to achieve truly valuable innovation and thus maximize the commercialization value. </li>
</ul>


Both generic drugs and innovative drugs are facing the problem of “shortened life cycle” in China, pushing pharmaceutical companies to optimize product mix and find some shortcut, such as license-in.
However, it has been more and more difficult to in-license cost-effective products, indicating that the afterwards commercialization could be hard to cover the license-in cost or make decent profits.. 
A way out is to reshape the development path after license-in by relying on strong R&amp;D systems, so as to achieve truly valuable innovation and thus maximize the commercialization value. 


A Second Thought on the License-In Mode - Dilemmas and Solutions

<ul>
<li>The 2021 national medical insurance negotiation released results on December 3.</li>
<li>If the COVID virus continues to mutate in a more transmissible direction, the logic of related companies would change.</li>
<li>For those new IPOs that fell on debut, the current "cold winter" is a rational return of the crazy healthcare investment capital market since 2019.</li>
</ul>


The 2021 national medical insurance negotiation released results on December 3.
If the COVID virus continues to mutate in a more transmissible direction, the logic of related companies would change.
For those new IPOs that fell on debut, the current "cold winter" is a rational return of the crazy healthcare investment capital market since 2019.


China Healthcare Weekly (Dec.3)-2021 Insurance Negotiation Results,new COVID Virus,a Rational Return

Equity Bottom-Up

Sihuan Pharmaceutical Hldgs / Equity Bottom-Up

<p><a href="https://www.smartkarma.com/entities/sihuan-pharmaceutical-hldgs" target="_blank" data-smartkarma-citation="entities:33:1" rel="noopener">Sihuan Pharmaceutical Hldgs (460 HK)</a>’s share price fell for two consecutive days on Sep.27 and Sep.28, decreasing 11% and 17.98%, respectively. According to public news, recently, Sihuan filed a lawsuit against CBC Group for infringement of trade secrets and such lawsuit has been formally accepted by the Beijing Intellectual Property Court. Meanwhile, there are also concerns on the acquisition of Hugel by CBC Group that may affect Sihuan’s exclusive distribution rights in China for Botulinum Toxin Type A (Letybo) and Hyaluronic Acid. On Sep.30, Sihuan made an announcement to claim that the Company does not expect its exclusive distribution rights will be affected by the Hugel Acquisition. This insight mainly analyzed the potential impact of the acquisition, the business and the outlook of the Company.</p>

Sihuan Pharmaceutical Hldgs (460 HK)’s share price fell for two consecutive days on Sep.27 and Sep.28, decreasing 11% and 17.98%, respectively. According to public news, recently, Sihuan filed a lawsuit against CBC Group for infringement of trade secrets and such lawsuit has been formally accepted by the Beijing Intellectual Property Court. Meanwhile, there are also concerns on the acquisition of Hugel by CBC Group that may affect Sihuan’s exclusive distribution rights in China for Botulinum Toxin Type A (Letybo) and Hyaluronic Acid. On Sep.30, Sihuan made an announcement to claim that the Company does not expect its exclusive distribution rights will be affected by the Hugel Acquisition. This insight mainly analyzed the potential impact of the acquisition, the business and the outlook of the Company.

Sihuan Pharmaceutical (460.HK) - The Dispute with CBC Group, the Business and the Outlook

IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

Equity Capital Markets

<div><p><a href="https://www.smartkarma.com/entities/abbisko-cayman-limited" target="_blank" data-smartkarma-citation="entities:33511:1" rel="noopener">Abbisko Cayman (ABB HK)</a> is a clinical-stage biopharmaceutical company focused on the discovery and development of innovative and differentiated small molecule oncology therapies. Abbisko has developed a pipeline of 14 candidates focused on oncology, including five candidates at the clinical stage The core products are ABSK091, a pan-FGFR inhibitor licensed from <a href="https://www.smartkarma.com/entities/astrazeneca-plc" target="_blank" data-smartkarma-citation="entities:21824:1" rel="noopener">AstraZeneca PLC (AZN LN)</a> and ABSK011, an FGFR4 inhibitor. </p></div><div><p>Abbisko has launched an HKEx IPO to raise net proceeds of HK$1,585.1 million ($204 million) at the mid-point of the IPO price range of HK$12.16-12.46 per share.</p></div><div><p>Eleven cornerstone investors have agreed to invest about $128 million in the IPO (57.32% of the offer shares at the mid-point of the IPO price range). Seven out of the eleven cornerstones are existing investors. They are Janchor Partners, Lilly Asia Ventures, Temasek, Lake Bleu Capital, OrbiMed, Warburg Pincus and BlackRock. The four cornerstones which are not existing shareholders are AIHC Capital, UBS AM, Hudson Bay and Vivo Funds.</p></div><div><div><div class="content-highlight"><p>In <a href="https://www.smartkarma.com/insights/abbisko-ipo-a-promising-but-longer-term-prognosis" target="_blank" data-smartkarma-citation="insights:58004" rel="noopener">Abbisko IPO: A Promising but Longer Term Prognosis</a>, we stated that while both core products are at an early stage of development, promising results from trials, management’s track record and the exceptional line-up of blue-chip backers suggest that the product candidates have the potential to succeed in a fiercely competitive market. We concluded that Abbisko is worth a closer look. However, our valuation analysis suggests that the IPO price range is full and we would remain on the sidelines awaiting a better entry opportunity. </p></div></div></div>

Abbisko Cayman (ABB HK) is a clinical-stage biopharmaceutical company focused on the discovery and development of innovative and differentiated small molecule oncology therapies. Abbisko has developed a pipeline of 14 candidates focused on oncology, including five candidates at the clinical stage The core products are ABSK091, a pan-FGFR inhibitor licensed from AstraZeneca PLC (AZN LN) and ABSK011, an FGFR4 inhibitor. Abbisko has launched an HKEx IPO to raise net proceeds of HK$1,585.1 million ($204 million) at the mid-point of the IPO price range of HK$12.16-12.46 per share.Eleven cornerstone investors have agreed to invest about $128 million in the IPO (57.32% of the offer shares at the mid-point of the IPO price range). Seven out of the eleven cornerstones are existing investors. They are Janchor Partners, Lilly Asia Ventures, Temasek, Lake Bleu Capital, OrbiMed, Warburg Pincus and BlackRock. The four cornerstones which are not existing shareholders are AIHC Capital, UBS AM, Hudson Bay and Vivo Funds.In Abbisko IPO: A Promising but Longer Term Prognosis, we stated that while both core products are at an early stage of development, promising results from trials, management’s track record and the exceptional line-up of blue-chip backers suggest that the product candidates have the potential to succeed in a fiercely competitive market. We concluded that Abbisko is worth a closer look. However, our valuation analysis suggests that the IPO price range is full and we would remain on the sidelines awaiting a better entry opportunity. 

Asia Pac IPO & Placement Research, China biotech, Aequitas Research

Ke Yan, CFA, FRM

Asia Pac IPO & Placement Research, China biotech

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

<p>Abbisko is a clinical-stage biopharmaceutical company in China with a focus on selective FGFR inhibitors. The company launched book building to raise up to USD 226m via a Hong Kong listing.</p><p>In our previous note, we discussed that the company's product pipeline has a strong focus on selective FGFR small molecules for oncology therapy. Its core products ABSK011 is an FGFR4 inhibitor and ABSK091 is a pan-FGFR inhibitor, which was in-licensed from AstraZeneca with global rights. We think its products have yet to show convincing clinical numbers despite strong prospects from pre-clinical readings. We think the company's management team is experienced with a proven track record of product development and commercialization. The investor line-up is strong. We also provide forecast and valuation for the two core products, ABSK011 and ABSK091. </p><p>In this note, we provide an update for the book building. We will run the deal through our ECM framework and provide our thoughts on the deal.</p>

Abbisko is a clinical-stage biopharmaceutical company in China with a focus on selective FGFR inhibitors. The company launched book building to raise up to USD 226m via a Hong Kong listing.In our previous note, we discussed that the company's product pipeline has a strong focus on selective FGFR small molecules for oncology therapy. Its core products ABSK011 is an FGFR4 inhibitor and ABSK091 is a pan-FGFR inhibitor, which was in-licensed from AstraZeneca with global rights. We think its products have yet to show convincing clinical numbers despite strong prospects from pre-clinical readings. We think the company's management team is experienced with a proven track record of product development and commercialization. The investor line-up is strong. We also provide forecast and valuation for the two core products, ABSK011 and ABSK091. In this note, we provide an update for the book building. We will run the deal through our ECM framework and provide our thoughts on the deal.

Abbisko (和誉) IPO: Fairly Valued for the Early Stage of Clinical Trials

China

Everest Medicines Limited operates as a late clinical-stage biopharmaceutical company. The Company engages in licensing, clinical development, and commercialization of therapies for oncology, immunology, cardio-renal disease, and infectious disease. Everest Medicines markets its products in China and other emerging Asia Pacific markets.

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Everest Medicines (1952 HK)

A Second Thought on the License-In Mode - Dilemmas and Solutions

We analyzed the logic and dilemma faced by China pharmaceutical companies in terms of license-in.As it's more difficult to in-license cost...

Xinyao (Criss) Wang

China Healthcare Weekly (Dec.3)-2021 Insurance Negotiation Results,new COVID Virus,a Rational Return

This article analyzed the 2021 national medical insurance negotiation results, the change in logic of valuation due to the new COVID virus, and a...

Xinyao (Criss) Wang

Sihuan Pharmaceutical (460.HK) - The Dispute with CBC Group, the Business and the Outlook

This article mainly analyzed the dispute between Sihuan and CBC Group, the potential impact of the Hugel Acquisition, Sihuan's medical beauty...

Xinyao (Criss) Wang

Abbisko IPO: Valuation Insights

Abbisko plans to raise $204m (net) at the mid-point of the IPO price range. Our valuation analysis suggests that the IPO price range is full and we...

Arun George

Abbisko (和誉) IPO: Fairly Valued for the Early Stage of Clinical Trials

We provide an update for Abbisko's book building. We run the deal through our ECM framework and provide our thoughts on the deal.

Ke Yan, CFA, FRM

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