Core Viewpoint - HaiXi Pharmaceutical has successfully completed its IPO subscription, raising significant interest with an oversubscription of 3113 times the initial public offering amount, indicating strong market demand for its shares [1] Group 1: IPO Details - HaiXi Pharmaceutical's IPO took place from October 9 to 14, with a total of HKD 3.094 billion in margin loans borrowed by brokers [1] - The company plans to issue 11.5 million H-shares, with a public offering price range between HKD 69.88 and HKD 86.4, aiming to raise up to HKD 990 million [1] - The expected listing date is October 17, with Huatai International and China Merchants Jinling International serving as joint sponsors [1] Group 2: Business Overview - HaiXi Pharmaceutical is a commercial-stage pharmaceutical company engaged in research, development, production, and sales, with a pipeline of innovative drugs under development [1] - The company has a portfolio of generic drugs targeting various diseases, including gastrointestinal, cardiovascular, endocrine, neurological, and inflammatory diseases, with 15 generic drugs approved by the National Medical Products Administration [1] - Four of these generic drugs are included in the national volume-based procurement (VBP) program [1] Group 3: Innovative Drug Pipeline - The company's innovative drug pipeline includes a novel oncology drug and an oral medication for wet age-related macular degeneration (wAMD), diabetic macular edema (DME), and retinal vein occlusion (RVO) [2] - The fastest progressing drug in the pipeline is C019199, targeting osteosarcoma, which is set to enter Phase III trials in the second half of this year [2] Group 4: Financial Performance - The company's projected revenues for 2022, 2023, 2024, and the five months ending May 31, 2025, are RMB 212.5 million, RMB 316.6 million, RMB 466.7 million, and RMB 249.2 million, respectively [2] - Corresponding gross profits for the same periods are RMB 172.1 million, RMB 263.6 million, RMB 387.2 million, and RMB 209.3 million [2] Group 5: Use of Proceeds - Approximately 52% of the net proceeds from the fundraising will be allocated to ongoing research and development to advance the drug pipeline [3] - 23% will be used to enhance R&D capabilities and seek collaboration opportunities, while 8% will focus on improving commercialization capabilities and expanding market influence [3] - Additional allocations include 7% for optimizing R&D and production systems, and 10% for working capital and other general corporate purposes [3]

Core Viewpoint - Fujian Haixi New Drug Creation Co., Ltd. has passed the listing hearing on the Hong Kong Stock Exchange, with Huatai International and CMB International as joint sponsors [1] Company Overview - Haixi New Drug is a commercial-stage pharmaceutical company that integrates research and development, production, and sales capabilities, with a pipeline of innovative drugs under development [3] - The company has received approval from the National Medical Products Administration for 14 generic drugs and has established a pipeline of four innovative drugs [3] - The revenue during the track record period comes from 13 approved products, primarily in therapeutic areas that account for over 25% of China's total pharmaceutical sales in 2023 [3] Product Portfolio - The company employs a dual-track model, focusing on both generic drugs and innovative drugs in development [3] - The product portfolio includes approved generic drugs for digestive, cardiovascular, endocrine, neurological, and inflammatory diseases [3] - Four of the approved generic drugs are included in the National Volume-Based Procurement (VBP) program, contributing significantly to revenue [3] Financial Performance - Revenue figures for Haixi New Drug are as follows: approximately RMB 212 million in 2022, RMB 317 million in 2023, RMB 467 million in 2024, and RMB 249 million for the five months ending May 31, 2025 [7][8] - Profit figures for the same periods are approximately RMB 69 million, RMB 117 million, RMB 136 million, and RMB 90 million respectively [7][8] - The company’s major products include Anbili® (RMB 146 million revenue in 2024, 25.7% market share), Haihuaitong® (RMB 187 million revenue in 2024, 59.3% market share), and Ruian Tuo® (RMB 48 million revenue in 2024, 16.7% market share) [3][4]

Core Viewpoint - Haixi New Drug, the first pharmaceutical company in Fujian to obtain a drug production license, is advancing its IPO process on the Hong Kong Stock Exchange, showcasing significant revenue growth but facing various operational risks [1][2]. Financial Performance - Haixi New Drug's revenue surged from 2.12 billion in 2022 to 4.67 billion in 2024, with a net profit increase from 690 million to 1.36 billion during the same period, reflecting a compound annual growth rate (CAGR) of 48.2% for revenue and 40.5% for net profit [4]. - In the first five months of 2025, the company reported revenue of 2.49 billion and a net profit of 902 million [4][20]. Revenue Dependence and Risks - The company heavily relies on 13 approved generic drugs, with 4 included in the national volume-based procurement (VBP) program, leading to a significant dependency on VBP products, which accounted for 72.6% of revenue in 2024 [6]. - The top five customers contributed over 70% of total revenue, with the largest customer accounting for 44.5% [6]. - Key VBP products are approaching contract expiration, with two set to expire by the end of 2025 and others in subsequent years, raising concerns about future revenue stability [6][7]. Cash Flow and Financial Health - Despite impressive revenue growth, the company's cash flow is under pressure, with a cash balance of only 380 million at the end of 2024, covering just 21% of current liabilities [15][21]. - The operating cash flow has shown fluctuations, with a net cash flow of 1.64 billion in 2024, but a decline to 800 million in the first five months of 2025 [11]. Sales and Marketing Expenses - The sales expense ratio increased from 22% in 2022 to 35.5% in 2024, significantly higher than the industry average, which may erode profit margins [12][13]. - The rising sales costs are attributed to increased channel maintenance expenses and the need for additional marketing resources for newly included VBP products [12]. Innovation Pipeline - Haixi New Drug has four innovative drugs in development, but all are in early stages, with the first clinical trials just starting [17][19]. - The company’s R&D expenditure is relatively low, with rates below the industry threshold of 20%, which may hinder future innovation [19][23]. - The company plans to use funds from the IPO to support clinical development and expand its sales network, but faces competition from established products that are already ahead in the market [24]. Production Capacity Concerns - The company’s production facility in Chang Le has a designed capacity of 2 billion tablets per year, but actual sales in 2024 were only 460 million tablets, raising concerns about potential overcapacity [25].