China, IPOs

Hong Kong exchange picks up steam with two biotech IPOs from Innovent, MicuRx

Amid the IPO frenzy taking place on the Nasdaq, the stock exchange in Hong Kong has quietly caught up with two applications at the end of last week — the third and fourth companies to try the route since the city opened up to pre-revenue biotechs wanting to list.

Michael Yu

The first candidate is Innovent Biologics, a 7-year-old biotech unicorn long rumored to be angling for a public listing and handed $150 million in a Series E crossover round weeks ago. They were joined by fellow Shanghai-based drugmaker MicuRx Pharma, which is looking for some help powering through various studies for its drugs treating multiple drug resistant infections.

In an unusual chairman’s letter that starts off the application document, Innovent founder and CEO Michael Yu reflected on the founding philosophy of the company:

The reality is that there is a huge gap between China’s biopharmaceutical industry and international standards. China’s biopharmaceutical production capacity is less than one-fiftieth of that of the United States, and not even one-tenth of that of South Korea. Among the top ten best-selling drugs in the world, eight are biologics and five are monoclonal antibody drugs, while China’s bestselling drugs are still mostly chemical drugs and traditional Chinese medicines. Imported drugs dominate China’s antibody drug market, and for most Chinese patients, these life-saving drugs are often unaffordable and out of reach.

His answer to that need has now grown to a 510-strong company with a pipeline of 17 drugs, with seven in clinical development and four in Phase III trials.

Sintilimab, a PD-1 inhibitor currently under priority review in China, is the star here; Innovent is also looking to start early-stage trials of the drug in the US while using it as a base for two other assets they are co-developing with Eli Lilly.

As is standard in these applications, Innovent redacted anything that could remotely give the IPO away, so we don’t know whether it is indeed seeking $300 million to $500 million, as Reuters previously reported. What we do know is that sintilimab, together with three biosimilars — going after blockbusters like Avastin, Rituxan and Humira — will claim most of the raise, from trials and registration filings to commercialization.

Great Biono Fortune, a coalition of Innovent employees, owns the largest chunk of stock at 10.22%, followed by Lilly Asia Ventures and F-Prime Capital, which have 8.86% each.

Zhengyu Yuan

MicuRx, meanwhile, has kept its ambitions tightly under wraps. CEO Zhengyu Yuan founded the company after an R&D stint at Vicuron (merged with Pfizer) with the help of then-colleague Mike Gordeev, now CSO.

The company, which has teams in both San Francisco and Shanghai, closed a $15 million financing last year to complete a Phase III for its lead oral antibiotic, contezolid (MRX-1). The bulk of the raise will go toward MRX-4, a prodrug formulation of MRX-1 dubbed contezolid acefosamil. While the drug is only beginning human studies in China, it’s ready to roll with a Phase II in the US later in the year. MicuRx will also invest some cash into a preclinical polymicin antibiotic backed by CARB-X.

A BVCF subsidiary and Morningside are the largest shareholders, controlling 29.12% and 26.50% respectively.

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Sr. Manager, Regulatory Affairs, CMC
CytomX Therapeutics San Francisco, CA
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Catalytic Data Science Charleston, SC
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Flatiron Health New York City or San Francisco

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