BIOKIN PHARMACEUTICAL(SH:688506) Sou Hu Cai Jing·2025-11-16 09:52Core Viewpoint - The company Baili Tianheng (688506.SH) has unexpectedly suspended its Hong Kong IPO just five days before the scheduled listing date due to unfavorable market conditions, despite significant investments in R&D and a strong pipeline of innovative drugs [1][2][4]. Group 1: IPO Suspension Reasons - The decision to pause the IPO is attributed to the current "breaking wave" in the Hong Kong new stock market, where three out of five newly listed stocks in November have already experienced a drop in share price on their first day [4][5]. - Baili Tianheng's initial plan was to issue 8.6343 million shares at a price range of HKD 347.50 to HKD 389.00, but the A-share closing price on the day of the IPO was HKD 370, indicating a potential overvaluation compared to other pharmaceutical companies [4][5]. - The company faced a lack of strong cornerstone investors, with only five investors committing to a total of HKD 249 million, which is only 7.81% of the total fundraising target, contrasting sharply with competitors like Heng Rui Medicine, which secured 43% from cornerstone investors [5][6]. Group 2: Financial Performance and Strategy - Baili Tianheng has invested heavily in R&D, spending CNY 17.72 billion in the first three quarters of 2025, a 90% increase year-on-year, which has led to a net loss of CNY 4.95 billion in the same period [9][10]. - The company recently secured a significant licensing deal with Bristol-Myers Squibb (BMS) for its ADC drug, which generated an upfront payment of USD 800 million and additional milestone payments, resulting in a projected revenue of CNY 58.23 billion for 2024, a staggering increase of 936.31% [9][10]. - The long-term goal of the company is to become an "entry-level multinational pharmaceutical company" by 2029, with the Hong Kong listing aimed at raising funds for global clinical trials and enhancing international visibility [10][12]. Group 3: Market Conditions and Future Outlook - The current market conditions are challenging for innovative drug companies, with investors becoming increasingly selective about unprofitable firms, which has led to a decline in institutional holdings in Baili Tianheng's A-shares [6][12]. - The company’s decision to delay the IPO is seen as a strategic move to avoid "selling itself short" in a down market, with the potential to return to the market when conditions improve [12][13].