Qiming-backed Pharma Firm Sinocelltech To Raise $181m In STAR Market IPO

Chinese biological drug developer Sinocelltech Group Limited is targeting to raise 1.28 billion yuan ($181 million) in its initial public offering on the Nasdaq-style STAR Market of the Shanghai Stock Exchange (SSE), according to the company’s latest filing on June 15.

Backed by Chinese globally venture capital firm Qiming Venture Partners, Sinocelltech has offered 50 million common shares at a price of 25.64 yuan ($3.6) each.

The issue opened for subscription on June 9 and closed on June 10, and is said to have been oversubscribed 3,519 times, Reuters reported.

Sinocelltech will primarily invest the proceeds for the clinical research of biological products, as well as to fuel working capital needs.

HK-listed investment bank China International Capital Corporation Limited (CICC) serves as its principal underwriter for the deal, and CITIC Securities Company Limited acted as its financial advisor. Sinocelltech will float the shares under the symbol “688520”.

Co-founded by Dr. Liangzhi Xie, Sinocelltech produces macromolecular drugs for diseases associated with oncology, autoimmunity and infections. As of May 2020, it has developed a pipeline of 21 innovative drug candidates. 

The company registered 808 million yuan ($114 million) in assets under management in 2019 and 540 million yuan ($76 million) in 2018, per its prospectus. 

Following the IPO, Lhasa Ailike Investment will be the largest shareholder in Sinocelltech with 61.5234 per cent stake. Chinese asset manager CDH Investments will hold 2.7354 per cent and Qiming will have a combined 0.4437 per cent.  

In 2017, Qiming and HanFor Capital had collectively infused 200 million yuan ($28 million) in Sinocelltech. Subsequently, CDH teaming up with a slew of investors such as Tsing Song Capital had also poured 585 million yuan ($83 million) in the company. 

Global research and consulting firm Frost & Sullivan released a report that the market size of global biological drugs is expected to surge to $402 billion in 2023, while it will amount to 641 billion yuan ($91 billion) in China.