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.

Quantitative Analysis

<ul>
<li>We analyse the changes of A/H premium on 138 stocks over the last week.</li>
<li>Real Estate, Industrials, Utilities Led the week on week A-H premium decline of 2.7ppt. </li>
<li>We highlight stocks including Shanghai Junshi, CIMC Vehicles, and CRCC Corp.</li>
</ul>


We analyse the changes of A/H premium on 138 stocks over the last week.
Real Estate, Industrials, Utilities Led the week on week A-H premium decline of 2.7ppt. 
We highlight stocks including Shanghai Junshi, CIMC Vehicles, and CRCC Corp.


A-H Premium Weekly: Real Estate, Industrials, Utilities Led the Decline

HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Thematic (Sector/Industry)

<ul>
<li>Last week, the focus of the 2022 Volume-Based Purchase (VBP) was finalized. We summarized the key points and major VBP projects to be promoted this year.</li>
<li>For IVD companies that seize the golden COVID-19 testing opportunity, they have already accumulated large amount of cash flow. It means M&amp;A opportunities but also bubbles in the industry. </li>
<li>The market value of a lot of medical device companies in HKEX has already been very small. Is the market overly pessimistic?</li>
</ul>


Last week, the focus of the 2022 Volume-Based Purchase (VBP) was finalized. We summarized the key points and major VBP projects to be promoted this year.
For IVD companies that seize the golden COVID-19 testing opportunity, they have already accumulated large amount of cash flow. It means M&amp;A opportunities but also bubbles in the industry. 
The market value of a lot of medical device companies in HKEX has already been very small. Is the market overly pessimistic?


China Healthcare Weekly (Apr.15)- 2022 VBP Focus, Post-COVID IVD Outlook, Undervalued Medical Device

Equity Bottom-Up

<ul>
<li>Due to its early involvement in license-in mode, Zai Lab could in-license many high-quality candidates at a low price in the early stage, thus leading to today's achievements.</li>
<li>However, the increasingly low cost performance of in-licensed products has made the capital “reconsider”, because it is increasingly difficult to maintain high growth as before based on license-in mode.</li>
<li>Zai Lab could be a good short-term trade,especially when it reaches licensing deals or launch new products,but doubts about long-term prospects could discourages investors from holding it for long term.</li>
</ul>


Due to its early involvement in license-in mode, Zai Lab could in-license many high-quality candidates at a low price in the early stage, thus leading to today's achievements.
However, the increasingly low cost performance of in-licensed products has made the capital “reconsider”, because it is increasingly difficult to maintain high growth as before based on license-in mode.
Zai Lab could be a good short-term trade,especially when it reaches licensing deals or launch new products,but doubts about long-term prospects could discourages investors from holding it for long term.


Zai Lab Ltd (ZLAB.US/9688.HK) - Will Zai Lab Go into a Vicious Circle?

Innovent Biologics Inc / Equity Bottom-Up

<ul>
<li>The biggest characteristic of <a href="https://www.smartkarma.com/entities/innovent-biologics-inc" target="_blank" data-smartkarma-citation="entities:27452:1" rel="noopener">Innovent Biologics Inc (1801 HK)</a> is its strong ability of resources integration. Besides, when it comes to execution, clinical efficiency and R&amp;D productivity, Innovent deserves credit.</li>
<li>If having 10 big commercialized drugs are the threshold for becoming a biopharma, Innovent's upgrade from biotech to biopharma is almost complete. </li>
<li>Innovent has enough cash flow over the next few years to support development, and may even turn losses into profits. So, we think that Innovent could get through “this winter”. </li>
</ul>


The biggest characteristic of Innovent Biologics Inc (1801 HK) is its strong ability of resources integration. Besides, when it comes to execution, clinical efficiency and R&amp;D productivity, Innovent deserves credit.
If having 10 big commercialized drugs are the threshold for becoming a biopharma, Innovent's upgrade from biotech to biopharma is almost complete. 
Innovent has enough cash flow over the next few years to support development, and may even turn losses into profits. So, we think that Innovent could get through “this winter”. 


Innovent Biologics Inc (1801.HK) - Capable of Surviving “this Winter”

Global Healthcare Analyst

Tina Banerjee

Shanghai Junshi Biosciences  / Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/shanghai-junshi-bioscience-h" target="_blank" data-smartkarma-citation="entities:27760:1" rel="noopener">Shanghai Junshi Bioscience Co. Ltd. (1877 HK)'s</a> oncology drug candidate toripalimab marketing application is currently under priority review by the FDA, with a target action date of April 30, 2022.</li>
<li>However, FDA may reject toripalimab application, as it is predominantly based on China clinical trial data. Toripalimab may also face delay in FDA decision due to delayed regulatory inspection.</li>
<li>PD-1 drug market in the U.S. is intensely competitive, making the commercialization prospect of a new drug quite difficult. Toripalimab reported muted performance in China due to pricing headwind.</li>
</ul>



Shanghai Junshi Bioscience Co. Ltd. (1877 HK)'s oncology drug candidate toripalimab marketing application is currently under priority review by the FDA, with a target action date of April 30, 2022.
However, FDA may reject toripalimab application, as it is predominantly based on China clinical trial data. Toripalimab may also face delay in FDA decision due to delayed regulatory inspection.
PD-1 drug market in the U.S. is intensely competitive, making the commercialization prospect of a new drug quite difficult. Toripalimab reported muted performance in China due to pricing headwind.


Shanghai Junshi Bioscience (1877 HK): Uncertainties Prevailing Ahead of First U.S. Drug Approval

China

Shanghai Junshi Biosciences Co., Ltd. operates as a biopharmaceutical company. The Company develops and sells small molecule drugs, antibody drug conjugates, and other products. Shanghai Junshi Biosciences markets its products worldwide.

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Shanghai Junshi Biosciences (1877 HK)

A-H Premium Weekly: Real Estate, Industrials, Utilities Led the Decline

Real estate sector led the weekly A-H premium decline. In addition, we highlight A-H premium changes in stocks including Shanghai Junshi...

Ke Yan, CFA, FRM

China Healthcare Weekly (Apr.15)- 2022 VBP Focus, Post-COVID IVD Outlook, Undervalued Medical Device

The focus of 2022 VBP was finalized. In post-COVID era, how would cash-rich IVD companies with find new growth point?After continuous pullback,...

Xinyao (Criss) Wang

Zai Lab Ltd (ZLAB.US/9688.HK) - Will Zai Lab Go into a Vicious Circle?

Due to increasing cost and potential legal risks, relying on license-in mode is not as glamorous as before.The transition to independent R&D takes...

Xinyao (Criss) Wang

Innovent Biologics Inc (1801.HK) - Capable of Surviving “this Winter”

After continuous pullback, investors may lose interest in Innovent. However, it still has investment value based on pipeline, resources, R&D and...

Xinyao (Criss) Wang

Shanghai Junshi Bioscience (1877 HK): Uncertainties Prevailing Ahead of First U.S. Drug Approval

Going by the FDA’s recent action, Junshi Bioscience’s toripalimab has a chance to get rejected by the FDA. It may miss the approval timeline....

Tina Banerjee

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