HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Equity Capital Markets

Asymchem Laboratories Tianjin / Equity Capital Markets

On June 28, 2021, <a href="https://www.smartkarma.com/entities/asymchem-laboratories-tianjin-co-ltd" target="_blank" data-smartkarma-citation="entities:28265:1" rel="noopener">Asymchem Laboratories (002821 CH)</a>, the fifth largest drug substance CDMO globally and the largest China-based commercial stage chemical drug CDMO, submitted its listing application to the HKEX, which means that, after <a href="https://www.smartkarma.com/entities/wuxi-apptec-co-ltd-bf4a1265-beef-48b6-b82d-29308426030f" target="_blank" data-smartkarma-citation="entities:27795:1" rel="noopener">WuXi AppTec Co. Ltd. (2359 HK)</a>, <a href="https://www.smartkarma.com/entities/hangzhou-tigermed-consulting-co-ltd-1008d609-73bd-4d76-8315-b29502a448ff" target="_blank" data-smartkarma-citation="entities:29212:1" rel="noopener">Hangzhou Tigermed Consulting (H) (3347 HK) </a>and <a href="https://www.smartkarma.com/entities/pharmaron-beijing-co-ltd" target="_blank" data-smartkarma-citation="entities:28428:1" rel="noopener">Pharmaron Beijing Co Ltd-H (3759 HK)</a>, there would be another A+H listed CXO company in China. This insight mainly analyzed the industry characteristics, the strength and the concerns of Asymchem.

On June 28, 2021, Asymchem Laboratories (002821 CH), the fifth largest drug substance CDMO globally and the largest China-based commercial stage chemical drug CDMO, submitted its listing application to the HKEX, which means that, after WuXi AppTec Co. Ltd. (2359 HK), Hangzhou Tigermed Consulting (H) (3347 HK) and Pharmaron Beijing Co Ltd-H (3759 HK), there would be another A+H listed CXO company in China. This insight mainly analyzed the industry characteristics, the strength and the concerns of Asymchem.

Pre-IPO Asymchem Laboratories - The Strength and the Concerns

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

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.

<a href="https://www.smartkarma.com/entities/asymchem-laboratories-tianjin-co-ltd" target="_blank" data-smartkarma-citation="entities:28265:1" rel="noopener">Asymchem Laboratories (002821 CH)</a> (AL) aims to raise around US$1-1.5bn in its H-share listing in Hong Kong. The A-shares listed were listed in Shenzhen in 2016.AL is a provider of outsourced pharmaceutical development and manufacturing solutions and services. AL provides process development and manufacturing services for small molecule drugs throughout the preclinical, clinical and commercial stages. According to Frost &amp; Sullivan, it is the fifth largest drug substance contract development manufacturing organization (CDMO) globally, and the largest China-based commercial stage chemical drug CDMO, as measured by 2020 revenue.As the A-shares are already listed and well covered, we will treat this listing more like a placement rather than an IPO. However, given the size of the listing, we will go into more details than we would for a regular placement. Hence, in this note we will briefly cover the company’s background and recent performance before touching upon the deal dynamics.

Asymchem Laboratories (002821 CH) (AL) aims to raise around US$1-1.5bn in its H-share listing in Hong Kong. The A-shares listed were listed in Shenzhen in 2016.AL is a provider of outsourced pharmaceutical development and manufacturing solutions and services. AL provides process development and manufacturing services for small molecule drugs throughout the preclinical, clinical and commercial stages. According to Frost &amp; Sullivan, it is the fifth largest drug substance contract development manufacturing organization (CDMO) globally, and the largest China-based commercial stage chemical drug CDMO, as measured by 2020 revenue.As the A-shares are already listed and well covered, we will treat this listing more like a placement rather than an IPO. However, given the size of the listing, we will go into more details than we would for a regular placement. Hence, in this note we will briefly cover the company’s background and recent performance before touching upon the deal dynamics. 

Asymchem Labs A/H Listing Early Look - Fast Growing, Relatively Insulated

Thematic (Sector/Industry)

Industry viewpoints:<ul>
<li>The 2021 medical insurance catalogue adjustment plan is soliciting opinions, and drugs approved for market launch during 2020.8.17 - 2021.6.30 will be eligible to participate in the negotiations.</li>
<li>Related departments issued new documents stating that from June to December this year, they will jointly carry out a special campaign to crack down on illegal medical beauty activities.</li>
<li>The General Office of the State Council issued a new document about the  development of public hospitals.</li>
</ul>Company news:News about the updated progress on drugs of <a href="https://www.smartkarma.com/entities/beigene-ltd" target="_blank" data-smartkarma-citation="entities:27352:1" rel="noopener">BeiGene Ltd (6160 HK), </a><a href="https://www.smartkarma.com/entities/jiangsu-hengrui-medicine-co-ltd" target="_blank" data-smartkarma-citation="entities:14128:1" rel="noopener">Jiangsu Hengrui Medicine (600276 CH)</a>, <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>, and <a href="https://www.smartkarma.com/entities/cspc-pharmaceutical-group-ltd" target="_blank" data-smartkarma-citation="entities:229:1" rel="noopener">CSPC Pharmaceutical Group (1093 HK)</a>.Market review:Last week, stock price for healthcare sector in A share decreased 2.8%, while CSI 300 decreased 2.34% over the same period of time.Risk disclosure:Policy risk, R&amp;D risk, Company risk and COVID-19 risk.

Industry viewpoints:
The 2021 medical insurance catalogue adjustment plan is soliciting opinions, and drugs approved for market launch during 2020.8.17 - 2021.6.30 will be eligible to participate in the negotiations.
Related departments issued new documents stating that from June to December this year, they will jointly carry out a special campaign to crack down on illegal medical beauty activities.
The General Office of the State Council issued a new document about the  development of public hospitals.
Company news:News about the updated progress on drugs of BeiGene Ltd (6160 HK), Jiangsu Hengrui Medicine (600276 CH), Innovent Biologics Inc (1801 HK), and CSPC Pharmaceutical Group (1093 HK).Market review:Last week, stock price for healthcare sector in A share decreased 2.8%, while CSI 300 decreased 2.34% over the same period of time.Risk disclosure:Policy risk, R&amp;D risk, Company risk and COVID-19 risk.

Equity Bottom-Up

Hansoh Pharmaceutical Group  / Equity Bottom-Up

When it comes to <a href="https://www.smartkarma.com/entities/jiangsu-hengrui-medicine-co-ltd" target="_blank" data-smartkarma-citation="entities:14128:1" rel="noopener">Jiangsu Hengrui Medicine (600276 CH)</a>, people would  also mention <a href="https://www.smartkarma.com/entities/hansoh-pharmaceutical-group" target="_blank" data-smartkarma-citation="entities:23675:1" rel="noopener">Hansoh Pharmaceutical (3692 HK)</a>, because its chairlady and CEO Zhong Huijuan is the wife of Hengrui’s Sun Piaoyang. Previously, Hansoh started with generic drugs (mainly first-to-market generic drugs), and has several blockbuster varieties with annual sales of more than RMB1 billion, such as zefei, pulaile, oulanning and so on. After more than 20 years of development, the Company has tablished a broad, diversified and leading drug portfolio in central nervous system (“CNS”) diseases, oncology, anti-infectives and diabetes. This article mainly analyzed the core products, the pipeline, the key risks, the thoughts on valuation and the catalysts.

When it comes to Jiangsu Hengrui Medicine (600276 CH), people would  also mention Hansoh Pharmaceutical (3692 HK), because its chairlady and CEO Zhong Huijuan is the wife of Hengrui’s Sun Piaoyang. Previously, Hansoh started with generic drugs (mainly first-to-market generic drugs), and has several blockbuster varieties with annual sales of more than RMB1 billion, such as zefei, pulaile, oulanning and so on. After more than 20 years of development, the Company has tablished a broad, diversified and leading drug portfolio in central nervous system (“CNS”) diseases, oncology, anti-infectives and diabetes. This article mainly analyzed the core products, the pipeline, the key risks, the thoughts on valuation and the catalysts.

Hansoh Pharmaceutical (3692.HK) - Insights on Core Products, Pipeline, Catalysts and Key Risks

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.

Betta Pharmaceuticals   / Equity Capital Markets

<a href="https://www.smartkarma.com/entities/betta-pharmaceuticals-co-ltd" target="_blank" data-smartkarma-citation="entities:25883:1" rel="noopener">Betta Pharmaceuticals (300558 CH)</a> is a biopharma company in China focused on the development, manufacture and commercialization of innovative therapies. Betta’s drug pipeline consists of two marketed therapies, five late clinical-stage or NDA-stage candidates, and more than twenty early clinical- and preclinical-stage candidates that address critical therapeutic targets. Betta listed its A Shares on the Shenzhen Stock Exchange in 2016 raising net proceeds of RMB657.35 million. In December 2020, Betta raised RMB995.4 million through a placing of 10.1 million A Shares. Betta is pre-marketing an H Share listing to raise $800 million, according to press reports. <div class="content-highlight">Despite efforts at diversification, Betta is highly dependent on a single product, icotinib, which was launched in 2011. The recent commercial launch of ensartinib will provide revenue diversification and a new growth engine. However, icotinib continues to face challenges and it will take some time for ensartinib to post meaningful market share gains (post-NRDL inclusion at the end of 2021). In combination with the weak underlying margin and cash generation, we are inclined to give this listing a pass.  </div>

Betta Pharmaceuticals (300558 CH) is a biopharma company in China focused on the development, manufacture and commercialization of innovative therapies. Betta’s drug pipeline consists of two marketed therapies, five late clinical-stage or NDA-stage candidates, and more than twenty early clinical- and preclinical-stage candidates that address critical therapeutic targets. Betta listed its A Shares on the Shenzhen Stock Exchange in 2016 raising net proceeds of RMB657.35 million. In December 2020, Betta raised RMB995.4 million through a placing of 10.1 million A Shares. Betta is pre-marketing an H Share listing to raise $800 million, according to press reports. Despite efforts at diversification, Betta is highly dependent on a single product, icotinib, which was launched in 2011. The recent commercial launch of ensartinib will provide revenue diversification and a new growth engine. However, icotinib continues to face challenges and it will take some time for ensartinib to post meaningful market share gains (post-NRDL inclusion at the end of 2021). In combination with the weak underlying margin and cash generation, we are inclined to give this listing a pass.  

Betta Pharmaceuticals IPO Initiation: One Step Forward, One Step Back

China

Betta Pharmaceuticals Co., Ltd operates as a pharmaceutical company. The Company researches, manufactures, and sells drugs for the treatment of malignant tumors, diabetes, cardiovascular, cerebrovascular, and other related diseases. Betta Pharmaceuticals markets throughout China.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

Betta Pharmaceuticals (300558 CH)

Pre-IPO Asymchem Laboratories - The Strength and the Concerns

The article mainly analyzed Asymchem Laboratories in terms of the industry characteristics, the strength of its business, the comparison with...

Xinyao (Criss) Wang

Asymchem Labs A/H Listing Early Look - Fast Growing, Relatively Insulated

Asymchem Laboratories (002821 CH) (AL) aims to raise around US$1-1.5bn in its H-share listing in Hong Kong. The A-shares listed were listed in...

Sumeet Singh

China Healthcare Weekly (Jun.18)

The article analyzed the 2021 medical insurance catalogue adjustment plan, new document to crack down on illegal medical beauty activities, new...

Xinyao (Criss) Wang

Hansoh Pharmaceutical (3692.HK) - Insights on Core Products, Pipeline, Catalysts and Key Risks

This article analyzed Hansoh Pharmaceutical in terms of core products, the pipeline, the key risks, the thoughts on valuation and the catalysts for...

Xinyao (Criss) Wang

Betta Pharmaceuticals IPO Initiation: One Step Forward, One Step Back

Betta is pre-marketing an H Share listing to raise $800 million, according to press reports. Overall, we think that Betta faces several challenges...

Arun George

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)