Sichuan Baili Tianheng Pharmaceutical Co., Ltd. (hereinafter referred to as "Baili Pharmaceutical", stock code: 688506) has updated its prospectus and is preparing to be listed on the Hong Kong Stock Exchange.

Baili Pharmaceutical has passed the IPO filing in December 2024 and is preparing to be listed on the Hong Kong Stock Exchange. Rumors suggest that Baili Pharmaceuticals could raise US$500 million, making it one of the largest deals planned in Hong Kong.

Baili Pharmaceutical has been listed on the Science and Technology Innovation Board in January 2023, and once it is listed on the Hong Kong Stock Exchange, it will also achieve "A+H" share listing.

The estimated annual revenue of 5.8 billion is mainly due to the receipt of a down payment of 800 million US dollars

Founded in 1996, Baili Pharmaceutical Co., Ltd. is a modern biopharmaceutical enterprise integrating drug R&D, production and marketing, with chemical drug preparations and Chinese patent medicine preparations and innovative biological drugs.

Baili Pharmaceutical has a full range of drug R&D and production capabilities, including small molecule chemical drugs, large molecule biological drugs and antibody drug conjugates (ADC drugs); It has R&D centers in China and the United States (USA: Systimmune; China: Baili Pharmaceutical and Duote Biotech, etc.), 1 large molecule biologics and antibody drug conjugate (ADC drug) manufacturer (Duote Biotech), 2 chemical drug preparation manufacturers (Baili Pharmaceutical and Guorui Pharmaceutical), 1 chemical API manufacturer (Jingxi Pharmaceutical), 1 chemical intermediate manufacturer (Haiyate Technology) and 2 pharmaceutical marketing companies (Baili Tianheng and Lhasa Xinbo); It covers the upstream and downstream integration capabilities from intermediates, APIs to preparations, and the complete life cycle commercial operation capabilities of "R&D-production-marketing".

According to the prospectus, Baili Pharmaceutical's revenue in 2021, 2022, and 2023 will be 795 million yuan, 700 million yuan, and 560 million yuan respectively; The losses during the period were 108 million yuan, 280 million yuan and 780 million yuan respectively.

Baili Pharmaceutical's revenue in the first nine months of 2024 was 5.661 billion yuan, compared with 377 million yuan in the same period last year, and the profit for the period was 4.065 billion yuan, compared with a loss of 515 million yuan in the same period last year.

Ten years ago, in 2014, Baili Pharmaceutical founded SystImmune in Seattle, USA, and began to develop the first-in-class EGFR × HER3 bispecific antibody ADC (BL-B01D1).

In 2024, Baili Pharmaceutical and BMS reached a global strategic licensing and cooperation transaction with a total amount of US$8.4 billion and a down payment of US$800 million for BL-B01D1, which is currently the largest global strategic licensing and cooperation transaction volume of a single asset in the global ADC field.

The significant increase in revenue of Baili Pharmaceutical was due to the receipt of advance payment from BMS during the reporting period. In the first four months of 2024, Baili Pharmaceutical's revenue from licensing fees was 5.33 billion yuan, accounting for 97% of revenue.

Baili Pharmaceutical recently released a performance forecast, and it is expected that the revenue in 2024 will be 5.8 billion yuan, an increase of 5.238 billion yuan over the same period of the previous year, an increase of about 932.27% year-on-year. The net profit attributable to the owners of the parent company will be about 3.6 billion yuan, an increase of 4.38 billion yuan compared with the same period of last year, and the net profit after deducting non-profits will be about 3.555 billion yuan, an increase of about 4.368 billion yuan compared with the same period of last year.

The main reason for the turnaround was the irrevocable, non-deductible down payment of US$800 million from Bristol-Myers Squibb (BMS), an overseas partner that received its core product BL-B01D1 (EGFR×HER3 bispecific antibody ADC) during the reporting period, based on the cooperation agreement.

As of September 30, 2024, Baili Pharmaceutical held cash and cash equivalents of 4.95 billion yuan.

Zhu Yi controls 74% of the shares

The executive directors of Baili Pharmaceutical are Dr. Zhu Yi, Ms. Zhang Suya, Kang Jian, Zhuo Zhi and Dr. Zhu Hai; The non-executive Director is Dr. Wang Guowei, and the independent non-executive Directors are Li Mingyuan, Yu Xiong, Yang Min and Dr. Xiao Geng.

As of September 30, 2024, the controlling shareholder and actual controller of Baili Pharmaceutical is Zhu Yi, a natural person, holding 74.34 shares of the company. Zhu Yi also serves as the chairman and general manager of the company.

Zhu Yi, born in December 1963, holds a bachelor's degree in radio from Sichuan University, a master's degree in biology from Fudan University, and a doctorate in management from Sichuan University. He is currently the chairman, general manager, chief scientific officer and core technical personnel of the company. From September 1987 to December 1990, he taught in the Department of Microbiology and Immunology, West China Medical University. From January 1991 to March 1992, he served as the director of Sida Biochemical Plant of Chengdu Biomedical Engineering Center; From March 1992 to October 2012, he served as the chairman of Xinbo Technology;

From August 1996 to September 2011, Zhu Yi established Baili Pharmaceutical and served as chairman and general manager; From November 2010 to October 2011, he served as the chairman and general manager of Tianheng Co., Ltd.; Since November 2011, he has served as the chairman and general manager of the company; At present, he is also the company's chief scientific officer and core technical personnel, chairman of Baili Pharmaceutical, executive director and manager of DotBio, executive director of Pangu Capital, and executive director and general manager of SystImmune.

OAP III (HK) Limited holds 7.11% of the shares, Zhang Suya holds 2.39% of the shares, China Merchants Bank Co., Ltd. - ChinaAMC SSE STAR Market 50 Component Exchange-traded Open-ended Index Securities Investment Fund holds 1.54% of the shares, and Industrial and Commercial Bank of China Co., Ltd. - E Fund SSE STAR Market 50 Component ETF holds 0.95% of the shares;

Guangzhou Telford Investment Consulting Partnership (Limited Partnership) - Guangzhou Defu II Equity Investment Fund (Limited Partnership) holds 0.76% of the shares, Bank of China Co., Ltd. - GF Healthcare Equity Securities Investment Fund holds 0.55% of the shares, and China Construction Bank Corporation - Wells Fargo Precision Medicine Flexible Allocation Hybrid Securities Investment Fund holds 0.51% of the shares;

Employees of CITIC Securities-Industrial Bank-CITIC Securities Baili Tianheng participate in the strategic placement collective asset management plan of the Science and Technology Innovation Board with 0.45% of the shares, and Essence Securities Investment Co., Ltd. (which has been renamed as SDIC Securities Investment Co., Ltd.) holds 0.4% of the shares.

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