CDH-backed biotech firm HitGen eyes $118m in STAR Market IPO

Chengdu-headquartered biotech company HitGen Inc, which is backed by CDH Investments, is seeking to raise a total of 835 million yuan ($118 million) in its initial public offering (IPO) on China’s Nasdaq-like STAR Market. 

HitGen will sell 40.68 million common shares at 20.52 yuan ($2.9) apiece, according to a company filing with the board. 

Chinese global investment bank China International Capital Corporation Limited (CCIC) is the principal underwriter of the deal. HitGen will float the shares under the symbol “688222”.

Founded in 2012 and located in Southwest China’s Sichuan province, HitGen has over 20 projects in R&D stage targeting the therapy areas of oncology, cardiovascular, inflammation, metabolism and ophthalmology. 

Its flagship DNA encoded library contains over hundreds of millions of DNA encoded compounds and 900 libraries for small molecule drug discovery research.  HitGen’s novel small molecule inhibitor for multiple myeloma has undertaken phase I clinical trials.

Besides, its small-molecule tyrosine kinase inhibitor HG030 for tumor disease has obtained an IND (investigational new drug) approval from the Centre For Drug Evaluation, NMPA, China’s regulatory authority for clinical trials and new products approval, per its latest press release on March 30, 2020. 

Its prospectus revealed that the company derives its revenue primarily from exports that contributed to 90 per cent of its earnings for three years in a row. The US is its largest export market accounting for 80 per cent of its annual revenue.

The company’s annual net profit grew to 120 million yuan ($17 million) as of 2019 compared to 75.3 million yuan ($10.6 million) in the previous year.  

Following the IPO, individual investor JIN LI will remain its controlling shareholder with a combined stake of  30.08 per cent stake in HitGen. Nanjing-based medical equipment provider Huabo Medical is the second-largest shareholder owning 14.763 per cent equity.

Following the IPO, CDH Investments will own 3.636 per cent stake, down from 4.047 per cent. 

HitGen will invest the IPO proceeds in building its molecule drug discovery platform and R&D centre. 

Prior to the IPO, HitGen had completed three rounds of funding. CDH had led a 250 million yuan ($35 million) Series B round in the company in 2018. The firm has also attracted capital from healthcare-focused venture capital firm Shiyi Capital, asset management company PKU Capital, state-backed Boyi Investment Fund and Juntian Venture Capital. 

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

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Following vacancies can be applied for (only in Singapore).   

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  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.