Fosun’s biotech arm mulls Hong Kong IPO

Bloomberg

Shanghai Henlius Biotech Inc., backed by Fosun Group, is planning an initial public offering that could make it one of the first to take advantage of proposed Hong Kong listing rules aimed at attracting early-stage drug developers, people familiar with the matter said.
The subsidiary of Shanghai Fosun Pharmaceutical (Group) Co. is considering selling shares in Hong Kong as soon as the second half of this year, according to the people.
The offering could raise at least $500 million, one of the people said, asking not to be identified because the information is private.
Selling shares could help Henlius Biotech fund more research as it develops treatments for oncology and autoimmune diseases. Henlius Biotech raised $140 million in
December from investors including Hong Kong-listed Jacobson Pharma Corp. in a deal valuing the company at more than $1.5 billion. Fosun Pharma, backed by Chinese billionaire Guo Guangchang, owns about 62 percent of Henlius Biotech, according to a statement at the time.
Henlius Biotech, which currently has no marketed products, is pursuing a Hong Kong listing as the city’s stock exchange weighs proposals intended to attract more innovative companies. The bourse said in December it was considering allowing biotech companies to list before they turn a profit, in addition to permitting dual-class share structures often used by technology firms.
Deliberations on a listing of Henlius Biotech are at early stage, and details could change, the people said. The company hasn’t made a final decision on the listing venue and could consider other overseas bourses, one of the people said.
A Hong Kong-based external spokesman for Fosun Pharma declined to comment, while Henlius Biotech didn’t immediately respond to an email seeking comment.
Henlius Biotech had previously pursued a listing on a Chinese over-the-counter market known as the Third Board, according to a December 2016 filing.
The Hong Kong exchange aims to finalise the new rules and begin taking applications around June, Chief Executive Officer Charles Li said. It plans to add people with biotech expertise to its listing division, Li told.
Henlius Biotech is seeking to repeat the success of other innovative Chinese drugmakers, which have mostly listed in the US Shares of Chinese cancer drug developer BeiGene Ltd. have risen more than fivefold since the company’s February 2016 IPO. Zai Lab Ltd., a Shanghai-based biopharmaceutical company run by a former Pfizer Inc. scientist, has gained 47 percent since its
September debut.
Fosun Pharma and Henlius Biopharmaceuticals set up Henlius Biotech in 2009. It has a pipeline of copies of biotechnology drugs, known as biosimilars, in various stages of human trial inside and outside China. The drug developer operates research and development centres in Shanghai, Taipei and California.