"Green Shoe Mechanism" Underdog, Hillhouse Group Heavy Warehouse, BeiGene (688235. SH) broke on the first day of listing.
On December 15, BeiGene officially landed on the Science and Technology Innovation Board, becoming the first innovative pharmaceutical company listed in China in three places. It opened down 8.12 percent, then widened the decline, falling nearly 20 percent at one point. As of the close, BeiGene fell 16.42% to 160.98 yuan per share, with a total market value of 214.874 billion yuan.
The issue price of BeiGene is 192.6 yuan per share, and the first sign (500 shares) is subject to a payment of 96,300 yuan. According to this calculation, the floating loss of the middle 1 sign as of the close was nearly 16,000 yuan.
Break on the first day
It was previously abandoned for nearly 200 million yuan
BeiGene Hong Kong stock (6160. HK) closed at HK$162, down 7.64%, while BeiGene U.S. Stocks (BGNE) closed at $278.43.
For the first day of the beigene science and technology innovation board, the industry is not surprised, "the valuation is already too high." Previously, in the new share subscription stage, BeiGene was abandoned by retail investors for nearly 200 million yuan.
BeiGene focuses on innovative oncology drugs, with a total of 3 self-developed drugs in the commercialization stage, namely BTK small molecule inhibitor Baiyueze (BRUKINSA, Zebutinib capsules, zanubrutinib), anti-PD-1 monoclonal antibody Bai zean (tirelizuzub injection, tislelizumab) and PARP inhibitor Park hui ze (Pamipali capsules, pamiparib).
When it landed on nasdaq in 2016, BeiGene had only four products under research that had entered the clinical trial phase, none of which had been released, raising less than $200 million and having a market capitalization of less than $2 billion.
When the Hong Kong stock market was listed in 2018, BeiGene raised $800 million, and its market value has increased fivefold.
In this listing, BeiGene issued 115 million new shares to the public, raising 22 billion yuan. That's less than two years since it last set a record $2.07 billion in global biomedical equity financing. As of December 15, BeiGene had raised nearly 70 billion yuan in the primary and secondary markets.
Currently, BeiGene has 48 commercial products and clinical phase drug candidates, including 10 commercial stage drugs, 2 declared drug candidates and 36 clinical stage drug candidates. Its product pipeline covers different stages from early exploration and discovery to marketing, focusing on the field of tumor treatment, and the product range covers small molecule drugs, monoclonal antibody drugs, bispecific antibody drugs, ADCs and other types. The company has more than 50 preclinical projects.
Still in the midst of huge losses
The R&D expense rate exceeds that of its peers
Despite the large number of commercial products, BeiGene is still in a huge loss.
In 2018, 2019, 2020 and January-June 2021, the net profit of shareholders of BeiGene's parent company was -4.747 billion yuan, -6.915 billion yuan, -11.384 billion yuan and -2.493 billion yuan, respectively. As of June 30, 2021, the company's cumulative undistributed profit was -30.076 billion yuan.
It is understood that the loss mainly comes from research and development investment. From 2018 to 2020, BeiGene's R&D expenses were 4.597 billion yuan, 6.588 billion yuan and 8.943 billion yuan, respectively.
According to BeiGene's response to the CSRC's inquiry letter, in 2019, the average annual salary of Baekje's R&D personnel was nearly 800,000 yuan, which was 2-3 times that of domestic counterparts. BeiGene is almost the enterprise with the highest R&D investment in domestic listed enterprises at present, with a R&D expense ratio of 452.66% in the first three quarters of 2020, which is about 6.6 times higher than the average R&D expense ratio of 68.7% of other listed companies.
In this regard, BeiGene President Wu Xiaobin once explained: "Most of the money burning" is used in clinical practice, and the reason why research and development expenditure is much higher than that of domestic counterparts is mainly that clinical trials are done more, and not only in China, but also in the world. If you do clinical trials around the world, from this point of view, the company's R & D investment is actually not much.
BeiGene is the Chinese pharmaceutical company that has conducted the most clinical trials overseas. As of September 2021, BeiGene conducts more than 95 planned or ongoing clinical trials, including 38 Phase III or potentially registered clinical trials, with a total enrollment of more than 13,000 patients and healthy subjects, covering more than 40 countries and territories, of which nearly half are enrolled overseas.
Although the "money shredder" is still in a state of huge losses and is far from profitable, BeiGene has gained the favor of Amgen, Baker Brothers, Hillhouse Group, Capital Research and Management and others.
Hillhouse Group has been involved in eight rounds of financing in BeiGene since 2014; hillhouse group is the third largest shareholder in BeiGene, and Hillhouse Group and its subsidiaries hold a combined 147 million shares in BeiGene, according to the prospectus.
BeiGene predicts that operating income in 2021 may reach 6.85 billion yuan to 8.02 billion yuan, much higher than the 2020 revenue scale of 2.12 billion yuan; net loss attributable to the mother may be 8.542 billion yuan to 11.012 billion yuan, lower than the net loss of 11.38 billion yuan in 2020.
Red Star News reporter Wu Danruo
Edited by Yang Cheng
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