Hong Kong stock ushered in another medical IPO - affected by typhoon , the oncology innovative drug research and development company and Yu Pharmaceutical officially landed on Hong Kong Stock Exchange to the 15th, with a closing price of HK$12.46 per share, with a market value of nearly HK$9 billion.
data shows that Heyu Pharmaceutical focuses on the research and development of new tumor drugs, focusing on small molecule tumor targeting and tumor immune drugs. Behind it are three doctors - Xu Yaochang, Yu Hongping and Chen Zhui, who have all worked in multinational pharmaceutical companies such as Eli Lilly, Novartis , Johnson & Johnson , and domestic pharmaceutical companies such as Hengrui , Hausen , and Hausen . In addition, Hengrui Medicine helmsman Sun Piaoyang serves as the independent non-executive director of in the company.
has been established for five years, Heyu Pharmaceutical has received support from a number of VC/PEs, including Hankang Capital, Eli Lilly Asia Fund, Sinopharm Capital, Taifu Capital, Qiming Venture Capital, CICC Capital, Zhengxin Valley Capital, Temasek , GIC, Eli Lilly Asia Fund, CICC Capital, Warcraft Investment, Carlyle Investment, Aobo Capital and Qingchi Capital. Before the IPO, Eli Lilly Asia Fund held 11.16% of the shares, Qiming Venture Capital held 8.65% of the shares, and Temasek held 8.28% of the shares.
"Old and Young" three doctors joined forces with
dedicated to the research and development of innovative drugs, and made a story of 9 billion market value
and Yu Pharmaceutical, which began with the three doctors - Xu Yaochang, Yu Hongping and Chen Zhui.
Because they were born in the 1950s, 1960s and 1970s respectively, they are also often called the "old, middle-aged and young" combination. In fact, they have a deep connection. Not only have they both studied abroad, but they have also worked in multinational pharmaceutical companies such as Eli Lilly, Novartis, Johnson & Johnson, , Merck and , as well as domestic leading pharmaceutical companies such as Hengrui and Hausen.
"leader" Xu Yaochang is 64 years old this year. In July 1982, he graduated from Nanjing University's chemistry major, and later went to the United States to study. In July 1988, he obtained a doctorate in Organic Chemistry from the University of Chicago. He began his career as a postdoctoral fellow at Sheebook University in Canada. In 1993, he served as a senior organic chemist and head of chemical research at the pharmaceutical company Eli Lilly & Company. There is a small episode in
. During his tenure at Eli Lilly, Xu Yaochang sought outsourcing companies to jointly develop new drugs in order to reduce R&D costs. At that time, he found that the salary of Chinese university graduates is generally 1,000-2,000 yuan and 3,000 yuan for doctoral students, which is far lower than the price of artificial labor in the United States and has a very cost-effectiveness.
Then, Xu Yaochang led his team back to China for inspection and put the outsourcing project in Zhangjiang, Shanghai, but he hoped to go further from the bottom of his heart and could lead the team to China to develop new drugs. Unfortunately, the Chinese strategy formulated by Eli Lilly at that time was to outsourcing cooperation rather than establishing a R&D center.
This was a bit frustrated for Xu Yaochang. The turning point occurred in 2005. One day, Xu Yaochang received an invitation from the President of Novartis R&D - hoping that Xu Yaochang would help Novartis establish a R&D center in China. In January 2007, Xu Yaochang and two other Chinese colleagues from Novartis came to Zhangjiang again to prepare for the construction of Novartis China R&D Center.
From the company's site selection, team formation, and new project establishment and promotion, Xu Yaochang and the R&D Center have built an excellent team of R&D talents for Novartis. However, when Novartis' new drug research and development system was basically established, Xu Yaochang was preparing to leave.
This time, he switched to domestic pharmaceutical companies. From 2012 to 2016, Xu Yaochang served as the general manager of the Shanghai New Drug R&D Center of Hausen Pharmaceutical Group, a pharmaceutical company engaged in drug development in the fields of anti-tumor, central nervous system and diabetes . During his tenure at Hansen, Xu Yaochang also served as chairman of the Hengrui-Hausen Pharmaceutical R&D Committee. Behind the two companies are a couple Sun Piaoyang and Zhong Huijuan . Sun Piaoyang also appeared in the column of Heyu Pharmaceutical's independent non-executive directors.
In 2016, Xu Yaochang decided to develop innovative drugs by himself, but it was difficult to complete it by fighting alone, so he chose two entrepreneurial partners - Yu Hongping and Chen Zhui.
Yu Hongping, 53 years old this year, has successively obtained a bachelor's degree in chemistry from from from from , and obtained a doctorate in chemistry from the University of British Columbia, Canada in November 2000, and also served as a postdoctoral researcher at the university. He has served as a senior research chemist at Merck, Novartis as a first-level senior researcher, and Shanghai Hansen Biopharmaceutical Technology Co., Ltd. as deputy general manager.
Chen Zhi is the youngest and is 47 years old this year. In May 1997, he received a bachelor's degree in biochemistry from the University of Texas and a doctorate from the Duke University in December 2003. He also has a rich resume. He has served as a senior scientist at Abbott , a second-level researcher at Novartis (China) Biomedical Research Center, and an associate director of Johnson & Johnson Oncology Research.
Just like this, the three doctors have traveled across three "ten years" of friendship, but pursued a common ideal - new drug research and development. They brought more than 40 scientific researchers to create Heyu Pharmaceutical and embarked on a journey of innovative drug research and development.
has been established for 5 years. How can I support an IPO?
was founded in 2016. Heyu Pharmaceutical is committed to researching innovative drugs used to treat various diseases such as tumors, infections, liver disease and central nervous system.
prospectus shows that at present, Heyu Pharmaceutical has established 14 R&D pipelines focusing on the comprehensive composition of precise oncology and tumor immune treatment. Among them, it includes 9 small molecule tumor precision treatments, 5 comprehensive small molecule immunotumor treatments, and 4 other types have entered the clinical research stage, namely CXCR4 antagonist, FGFR1/2/3 inhibitor, FGFR4 inhibitor, and CSF-1R inhibitor.
In addition, Heyu Pharmaceutical plans to submit IND applications for new drugs focused on new targets or methods of action that are in preclinical research in the next one to two years, with a new potential to solve major unmet medical needs.
According to Frost & Sullivan's analysis, the global tumor drug market annual growth rate is 10.5%, and it is expected that the scale will increase from 150.3 billion yuan in 2020 to 670.4 billion yuan; China's tumor drug market is expected to increase from 28.6 billion US dollars (approximately RMB 18 million) in 2020 to 145.5 billion US dollars (93 million yuan) in 2035, with a compound annual growth rate of 11.5%. Among them, small molecule therapy accounts for the vast majority of the market share.
However, as of now, Heyu Pharmaceutical has not yet commercialized its products and has large R&D expenditures, so it is in a loss-making state. The prospectus shows that in 2019, 2020 and the first quarter of 2021, Heyu Pharmaceutical's other revenue and income were RMB 12.705 million, RMB 18.831 million and RMB 1.98 million, respectively. The losses (net loss) during the same period were RMB 134 million, RMB 706 million and RMB 123 million respectively.
For the significant increase in losses in 2020, Heyu Pharmaceutical explained that it was mainly included in other expenses of 571 million yuan, including 570 million yuan of convertible redeemable preferred shares of fair value loss. In addition, its R&D expenditure in 2020 was 133 million yuan.
completed 4 rounds of financing, VC/PE lineup luxury
Why do they all invest in
All the way, Heyu Pharmaceutical has received support from a number of VC/PE. Before
IPO, Heyu Pharmaceutical completed four rounds of financing. In February 2017, Heyu Pharmaceutical completed a Series A financing of US$28 million, led by Hankang Capital, and jointly participated by Eli Lilly Asia Fund, Sinopharm Capital and Taifu Capital. After a year, in March 2019, Heyu Pharmaceutical completed a US$42 million Series B financing, led by Qiming Venture Capital, and jointly invested by well-known international sovereign fund, CICC Capital, Eli Lilly Asia Fund, Zhengxin Valley Capital, Taifu Capital and others.
In March 2020, Heyu Pharmaceutical completed a US$70 million Series C financing, led by Temasek. The existing investors Qiming Venture Capital, Hankang Capital, GIC, Eli Lilly Asia Fund, CICC Capital, and Zhengxin Valley Capital are additionally followed. The financing will be used to support the advancement of four existing clinical projects within the company's pipeline and the research and development of multiple preclinical projects.
In January this year, Heyu Pharmaceutical once again completed a US$123 million Series D financing. This round of financing was led by Warburg Pincus, Carlyle Investment Group , Aobo Capital, Qingchi Capital and a well-known Boston investment institution. The original shareholders Eli Lilly Asia Fund, Qiming Venture Capital, Temasek, Hankang Capital and CICC Capital continued to support it, with the cumulative financing scale reaching US$263 million.
In addition, Heyu Pharmaceutical introduced 11 cornerstones for its listing in Hong Kong, including LAV entity (Eli Lilly Asia Fund), Aranda (whomally owned subsidiary of Temasek), BlackRock, AIHC, Janchor Partners, Lake Bleu Prime, OrbiMed, etc., 7 of which are old shareholders. Data shows that before the IPO, Eli Lilly Asia Fund held 11.16% of the shares, Qiming Venture Capital held 8.65% of the shares, and Temasek held 8.28% of the shares.
As an early investor, Qiming Venture Capital led the B round in 2018 and participated in the C and D rounds of investment and Yu Pharmaceuticals. It is the second largest institutional investor of the company before listing.
and Yu Pharmaceutical are Qiming Venture Capital's 10th IPO this year. "As one of the early investors, Qiming Venture Capital has witnessed the growth of Heyu Pharmaceutical. The company has an excellent founding and management team, first-class R&D capabilities and a strong clinical R&D pipeline," said Hu Xubo, managing partner of Qiming Venture Capital. "We believe that Heyu Pharmaceutical will become a globally competitive innovative drug research and development company in the future. We will continue to support Heyu Pharmaceutical and do our best to solve the unmet clinical needs of patients in China and even the world." After
participated in Heyu Pharmaceutical's A round of investment, Hankang Capital continued to support it in the C, D and listing rounds. Speaking of the reasons for the operation, Hankang Capital stated that Dr. Xu Yaochang is a veteran in the biopharmaceutical industry. He has successively built the Novartis Shanghai R&D Center and the Hausen R&D Center, with very rich R&D experience and operation management experience. His co-founding team also has a deep understanding of the biological mechanism of precision tumor treatment. At the beginning of the company's establishment, it built a clear pipeline and rich products, including the FGFR series and the tumor immune series, and developed a number of differentiated innovative varieties. Based on these judgments, Hankang discovered and invested in the company in the early days of Heyu's establishment. Fang Min, partner of Warburg Pincus Investment and head of China Medical and Health Investment, told the investment community: "Heyu Pharmaceutical's successful listing is another important milestone in the company's development. On the one hand, it demonstrates the huge development space of the Chinese and global oncology treatment drug market, and on the other hand, it also strengthens the company's own leading advantages. Warburg Pincus Investment highly recognizes Heyu Pharmaceutical's R&D capabilities in the field of small oncology molecules, and firmly believes that the company's product pipeline has the potential to become a global blockbuster drug. We will continue to do so. We will support Heyu Pharmaceutical's future development and strive to benefit more patients with innovation and breakthroughs. "
" The company will take this successful listing in Hong Kong as an opportunity to face the global biomedical competition pattern and write a new chapter of the company's rapid development. In the future, we will seize the opportunity of rapid development of the industry, continuously optimize and upgrade the level of the R&D team, accelerate the development of core candidate products, and help patients and give back to the society with more innovative and effective drugs and excellent operating performance," said Xu Yaochang.
Xu Yaochang has always had a dream of developing new drugs. But the journey of new drug research and development is destined to be long, and the launch is only a small milestone.
