HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Equity Capital Markets

<ul>
<li>Sunho’s pipeline has high risk and there is a long way to go to demonstrate their final clinical value. It’s highly uncertain if Sunho would bring expected return to investors.</li>
<li>The entities involved in the process of reorganization were all related parties. Investment from Efung Anhe/Efung Ansheng sparked concern from CSRC. Sunho is required to explain whether there’s any benefit transfer.</li>
<li>Due to the lack of strong fundamentals, there is no reason for high valuation. It’s not surprising if Sunho’s valuation finally falls below HKD1.53 billion (or even below HK$1 billion).  </li>
</ul>


Sunho’s pipeline has high risk and there is a long way to go to demonstrate their final clinical value. It’s highly uncertain if Sunho would bring expected return to investors.
The entities involved in the process of reorganization were all related parties. Investment from Efung Anhe/Efung Ansheng sparked concern from CSRC. Sunho is required to explain whether there’s any benefit transfer.
Due to the lack of strong fundamentals, there is no reason for high valuation. It’s not surprising if Sunho’s valuation finally falls below HKD1.53 billion (or even below HK$1 billion).  


Pre-IPO Sunho Biologics (PHIP Updates) - Some Points Worth the Attention

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.

<ul>
<li>Sunho Biologics, a China-based clinical-stage biotechnology company, plans to raise up to US$100m via a Hong Kong listing.</li>
<li>In this note, we examine the company's three core products, namely IAP0971, IAE0972, and IAH0968, which target malignancies.</li>
<li>A large part of the company's pipeline is testing the unproven targets. We also think the management and pre-IPO investors are of mediocre quality.</li>
</ul>


Sunho Biologics, a China-based clinical-stage biotechnology company, plans to raise up to US$100m via a Hong Kong listing.
In this note, we examine the company's three core products, namely IAP0971, IAE0972, and IAH0968, which target malignancies.
A large part of the company's pipeline is testing the unproven targets. We also think the management and pre-IPO investors are of mediocre quality.


Sunho Biologics (盛禾) Pre-IPO: Testing the Unproven Targets

<ul>
<li>There is a certain connection between Sunho and Genscript. So, Sunho has a typical style of "CXO switching to biotech" – That is to do whatever is popular.</li>
<li>For core products, IAP0971 and IAE0972 just completed phase I trials, still with high R&amp;D failure risks. IAH0968 is difficult to become a blockbuster variety due to strong competing products.</li>
<li>As investors’re already rational about investing in unprofitable Biotech. The companies without commercialized products and with uncertain outlook may not be favored by the market. Therefore, high valuation is unreasonable.</li>
</ul>


There is a certain connection between Sunho and Genscript. So, Sunho has a typical style of "CXO switching to biotech" – That is to do whatever is popular.
For core products, IAP0971 and IAE0972 just completed phase I trials, still with high R&amp;D failure risks. IAH0968 is difficult to become a blockbuster variety due to strong competing products.
As investors’re already rational about investing in unprofitable Biotech. The companies without commercialized products and with uncertain outlook may not be favored by the market. Therefore, high valuation is unreasonable.


Pre-IPO Sunho Biologics (SHB HK) - High Valuations Can Be Hard to Come By

Sunho Biologics (SHB HK)

Pre-IPO Sunho Biologics (PHIP Updates) - Some Points Worth the Attention

Sunho's high-risk pipeline makes future return highly uncertain. Reorganization with related parties and "sudden" capital increase raised concern...

Xinyao (Criss) Wang

Sunho Biologics (盛禾) Pre-IPO: Testing the Unproven Targets

We examine the fundamentals of Sunho Biologics for its IPO. We are not positive on the success of its product pipeline and are not impressed with...

Ke Yan, CFA, FRM

Pre-IPO Sunho Biologics (SHB HK) - High Valuations Can Be Hard to Come By

Sunho does not have any drugs at NDA/BLA stage or commercialized products. Its outlook is highly uncertain due to challenging clinical trials...

Xinyao (Criss) Wang

Pre-IPO Sunho Biologics (PHIP Updates) - Some Points Worth the Attention

​Sunho's high-risk pipeline makes future return highly uncertain. Reorganization with related parties and "sudden" capital increase raised concern...

Xinyao (Criss) Wang

Sunho Biologics (盛禾) Pre-IPO: Testing the Unproven Targets

We examine the fundamentals of Sunho Biologics for its IPO. We are not positive on the success of its product pipeline and are not impressed with...

Ke Yan, CFA, FRM

Pre-IPO Sunho Biologics (SHB HK) - High Valuations Can Be Hard to Come By

Sunho does not have any drugs at NDA/BLA stage or commercialized products. Its outlook is highly uncertain due to challenging clinical trials...

Xinyao (Criss) Wang

Sunho's high-risk pipeline makes future return highly uncertain. Reorganization with related parties and "sudden" capital increase raised concern...