32
Capital Market Review and Outlook Pharmaceutical & Biotech industry driven by brand name drugs
Capital Market Review and Outlook Pharmaceutical & Biotech industry driven by brand name drugs
Capital market 2
M&A Transaction 15
Outlook and Key drivers 18
Endnotes 26
Contactors 27
Contents
Introduction
Since 2018, biopharma companies become high-profile in the capital markets:
In this context, we review the performance of the capital markets in the pharmaceutical and biotech Industry over the past period of time and look ahead to industry drivers. In the future, investment and financing activities in the pharmaceutical and biotech Industry will remain active in the securities market, and the Hong Kong market is expected to rise to the next level with the help of the new listing rule. The M&A market will also active through the increasing demand for branded drugs in pharmaceutical companies. We observed three trends:
• The first-in-class drugs continue to receive attention from the capital market, whose can effectively reduce R&D risks and maintain global market exclusivity will be favored
• Specialty drugs, orphan drugs, biologics and oncology in novel drugs will continue to be the tendency.
• Diversified cooperation between large multinational biopharma companies and emerging biopharma companies (EBP) will lead to new excellent enterprises in the capital market.
2018 is the bumper year of IPO for global pharmaceutical and biotech Industry with the value and volume both reaching a 10-year high according to the U.S., China and Hong Kong stock market data, and the momentum has not decreased since the beginning of 2019.
The HKEX introduced new rules in early 2018 to allow pre-revenue biotech companies to go public in Hong Kong. This move, together with other new measures, has become the most significant reform in the HKEX in 20 years. Not come singly but in pairs, Science and technology innovation board (STI) was established at the end of 2018, and piloted the registration-based IPO system on the Shanghai Stock Exchange. STI encouraging companies in six industries, including biotech through the differentiated arrangements in terms of profitability and shareholding structure. The restructured listing rule of STI will provide more financing opportunities to pre-revenue biotech companies.
A series of biotech companies engaged in the R&D of brand-name drugs have been able to listed on the biotech section of HKEX which has become the first sector on the main board of the HKEX to be tailed by industry attributes.
Since 2018, along with the announcement of a series of huge M&A transactions by Takeda to acquire Shire and Bristol-Myers Squibb to acquire Celgene, the list of M&A transaction in the pharmaceutical and biotech Industry has been continuously renewed. M&A activities in the pharmaceutical and biotech Industry have entered an active period with a series of biotech companies making major breakthroughs in the fields of oncology, rare diseases, gene therapy, etc.
Capital Market Review and Outlook | Capital market
2
Capital market
1. Pharmaceutical and biotech companies' IPOs continue to grow2018 is the bumper year of IPO for global pharmaceutical and biotech Industry regardless of the value or volume of transactions. According to the U.S., China and Hong Kong stock market data, total fundraising of IPOs in the global pharmaceutical and biotech Industry reached $11.5 billion in 2018, where 74 companies were listed through IPOs, reaching a 10-year high.
In the past decade, the overall IPO of US global pharmaceutical and biotech Industry has shown an upward trend in spite of volatility. As the global financial center, the US stands a prominent position in the scale and volume of fundraising in this field.
The Hong Kong market is one of the most attractive markets for global investors in Asia, and serves as an important link between China and global
capital market. In the past decade, Hong Kong stock market has played an key role in the IPO of pharmaceutical and biotech Industry globally. 2018 IPO performance of pharmaceutical and biotech companies in Hong Kong stock market far exceeded 2017 in both volume and value, with 8 companies completed IPOs. In early 2018, the HKEX introduced new rules, allowing pre-revenue biotech companies to go public in Hong Kong. Five companies were successfully listed in Hong Kong through the new regulation in 2018.
Capital Market Review and Outlook | Capital market
3
2. Total market value of the pharmaceutical and biotech sectors continues to raiseAs of the end of February 2019, the market value of the US pharmaceutical and biotech sector covers 9.9% of
IPO Financing Scale of U.S. Stock, A-Share and HK Stock (US$Mn)
U.S. Stock, A-Share and HK Stock IPO Volume
the overall US stock market, while the figures for A-share and Hong Kong stock were 6.7% and 7.9%, respectively. The scale of the US pharmaceutical and biotech sector is way beyond that of A-share and the Hong Kong stock markets.
In the past decade, the market cap of pharmaceutical and biotech companies in the US, A-Share and Hong Kong stock markets has experienced a rapid growth, among them the growth rate of A-Share and Hong Kong stocks exceeds the US stocks.
Source: Capital IQ
Source: Capital IQNote: The IPO data of the U.S. stock market does not include the companies with the US as second listing that went for IPO in NYSE/Nasdaq;U.S. stock include NYSE and Nasdaq. A-share stock includes the Shanghai Stock Exchange and the Shenzhen Stock Exchange. Hong Kong stock includes the HKEX. Capital IQ with selected industry classification as S&P pharmaceuticals, biotech
956
5,807
2,566 1,492
4,627
6,977 6,213 5,337 6,172
11,514
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
U.S. Stock A-Share HK Stock
U.S. Stock A-Share HK Stock
10
29 22
14
32
73
56
40
71 74
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
956
5,807
2,566 1,492
4,627
6,977 6,213 5,337 6,172
11,514
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
U.S. Stock A-Share HK Stock
U.S. Stock A-Share HK Stock
10
29 22
14
32
73
56
40
71 74
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
The IPO performance for pharmaceutical and biotech-related Industry in the A-share market has been volatile over the past decade. In 2017, biopharma IPO ushered in an outbreak, with total of 33 companies gone public. Whereas in 2018, only 3 biopharma companies went public with the impact of tightening IPO regulations. China's
pharmaceutical and biotech industry has made great progress. However the technology attributes of such industry in the A-share have yet to be fully reflected. It is expected that this trend will be completely broken when the STI is born where the launch of the STI will promote the discovery of industry value and usher in a booming IPO market.
The growth of IPOs in pharmaceutical and biotech companies has shown the following signals:
• Capital is highly interested in this field;
• Smooth IPO channel provides an important source of financing for biopharma companies
Capital Market Review and Outlook | Capital market
4
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1,000
2,000
3,000
4,000
5,000
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019/02
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100
200
300
400
500
600
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019/02
- 50
100 150 200 250 300 350
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019/02
Total market cap of pharmaceutical and biotech companies in the A-share market (US$Bn)
Source: Capital IQ, WindNote: A-Share include the Shanghai Stock Exchange and the Shenzhen Stock Exchange.
Source: Capital IQ, WindNote: US stocks include NYSE and Nasdaq.
Source: Capital IQ, WindNote: Hong Kong stocks include the HKEX.
10 Yr CAGR = 17%
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1,000
2,000
3,000
4,000
5,000
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019/02
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100
200
300
400
500
600
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019/02
- 50
100 150 200 250 300 350
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019/02
Total market cap of pharmaceutical and biotech companies in the U.S. stock market (US$Bn)
Total market cap of pharmaceutical and biotech companies in the HK stock market (US$Bn)
-
1,000
2,000
3,000
4,000
5,000
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019/02
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100
200
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2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019/02
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100 150 200 250 300 350
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019/02
10 Yr CAGR = 12%
10 Yr CAGR = 15%
190111 143
173
298
495
252
474
564
444529
1,401
86
1,430
101
1,543
81108
115
1,7772,545
3,176
205225
3,441 3,169
215
3,840
288
4,039
296
4,379
321
Capital Market Review and Outlook | Capital market
5
Additional Listing Rules and Measures to Protect Shareholders
• At least HK$1.5 billion
• Have operated in its current line of business for at least two financial years prior to listing.
• Have operated under substantially the same management during the Track Record Period.
• Have sufficient working capital (after taking into account the IPO proceeds) to cover at least 125% of its capital requirements for the next 12 months after IPO.
• Any shares allocated to a cornerstone investor and any shares subscribed by existing shareholders of Applicant at the time of listing shall not be considered as held by the public.
• Fundamental change to principal business requires HKEx’s prior consent.
• Biotech Companies not satisfying the continuing obligation to maintain sufficient operations or assets are given up to 12 months to re-comply with the rule.
• A listed Biotech Companies must have a stock marker “B” at the end of its name.
Initial market capitalization
Track Record
Working Capital
Cornerstone Investments
Risk Management
3. New listing rules in HKEX encourages the listing of pre-revenue biotech companiesOn April 30, 2018, the new listing rules of the HKEX took effect. Two
new chapters were added to the Main Board Listing Rule to allow pre-revenue biotech companies to go public in Hong Kong.
Suitability to List
Source: HKEX website
Source: HKEX website
Core Product regulated by a Competent Authority
• Competent authorities include the US Food and Drug Administration, the China Food and Drug Administration, and the European Medicines Agency.
• HKEx may recognize another national or supranational authority as a competent authority in individual cases.
This new policy will not only provide biotech companies with a more attractive financing platform, but also provide investors behind biotech companies with an earlier exit channel in Hong Kong's capital market.
At least one core product beyond the concept stage
• Core product has completed at least one clinical trial conducted on human subjects.
• Relevant competent authority has no objection for it to commence Phase II (or later) clinical trials to demonstrate bio-equivalency.
Sophisticated Investor and Meaningful Investment
• Applicant has received meaningful third-party investment from at least one sophisticated investor at least six months before listing.
Capital Market Review and Outlook | Capital market
6
• BeiGene develops and commercializes molecularly-targeted and immuno-oncology drugs for the treatment of cancer;
• Currently there are 6 internally-developed pipeline, including BTK inhibitor Zanubrutinib and PD-1 antibody Tislelizumab both with huge market potential and primacy for R&D;
• IPO Information: – Listing Date: 2018-08-08 – Market Capitalization at Listing Date: HKD82.1 billion – Issue Price: HKD108.00 – Total Fund Raised: HKD 6.8 billion
Source: Wind
Ascletis Pharma Stock Market Performance (Currency: HKD)
Source: Wind
BeiGene Stock Market Performance (Currency: HKD)
• Ascletis is a biotech company established in March 2013, addressing unmet medical needs in three therapeutic areas: viral, cancer and fatty liver diseases.
• Currently focusing on R&D and commercializing the entire value chain of HCV, HIV, HBV brand-name drugs.
• IPO Information: – Listing Date: 2018-08-01 – Market Capitalization at Listing Date: HKD15.7 billion – Issue Price: HKD14.00 – Total Fund Raised: HKD 2.98 billion
Ascletis Pharma Inc. (1672.HK)
BeiGene, Ltd. (6160.HK)
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Capital Market Review and Outlook | Capital market
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Source: Wind
Innovent Stock Market Performance(Currency: HKD)
• Established in 2011, Innovent has built up a pipeline of 17 monoclonal antibodies in the fields of oncology, ophthalmology, autoimmune and cardiovascular diseases;
• IPO Information: – Listing Date: 2018-10-31 – Market Cap at Listing Date: HKD18.54 billion – Issue Price: HKD 13.98 – Total Fund Raised: HKD 3.16 billion
Innovent Biologics, Inc. (1801.HK)
Source: Wind
Hua Medicine Stock Market Performance(Currency: HKD)
• Hua Medicine, established in 2009, advanced its principle drugs comprising of Dorzagliatin for the treatment of Type 2 Diabetes, undertaking Phase III monotherapy trial, and mGLUR5 for the treatment of PD-LID;
• IPO Information: – Listing Date: 2018-09-14 – Market Cap at Listing Date: HKD8.71 billion – Issue Price: HKD8.28 – Total Fund Raised: HKD 781 million
Hua Medicine (Shanghai) Ltd. (2552.HK)
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Capital Market Review and Outlook | Capital market
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Source: Wind
Junshi BioPharm Stock Market Performance (Currency: HKD)
• Junshi BioPharm is an innovation-driven biopharma company which is dedicated to discover and develop first-in-class or best-in-class drugs through original innovation.
• Junshi has a leading edge in the emerging field of immuno-oncology and for the treatment of autoimmune and metabolic diseases. Junshi is the first Chinese company filing IND application and NDA application to the NMPA for anti-PD-1 monoclonal antibody.
Shanghai Junshi Biosciences Co., Ltd. (1877.HK)
2018-12-24
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• IPO Information: – Listing Date: 2018-12-24 – Market Cap at Listing Date: HKD18.06 billion – Issue Price: HKD19.38 – Total Fund Raised: HKD2.94 billion
Capital Market Review and Outlook | Capital market
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• CStone Pharmaceuticals is a biopharma company focused on developing and commercializing innovative immuno-oncology and molecularly targeted drugs, the company has built a rich oncology pipeline of 14 drug candidates;
• The company adopted VIC model (VC+IP+CRO), dedicating in drug discovery, pharmacology, discovery of gene and animal research and development. The rapid R&D process of novel drug due to daily implementation of preclinical research through R&D
Cstone Pharmaceuticals (2616.HK)
outsourcing cooperation with CROs such as WuXi AppTec.
• IPO Information: – Listing Date: 2019.02.26 – Market Cap at Listing Date: HKD12.7 billion – Issue Price: HKD12.00 – Total Fund Raised: HKD 2.1 billion
Source: Wind
Cstone Pharmaceuticals Stock Market Performance (Currency: HKD)
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Capital Market Review and Outlook | Capital market
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4. The establishment of the STI will benefit biotech companies
• Science and technology innovation board (STI) was established at the end of 2018, and piloted the registration-based IPO system on the Shanghai Stock Exchange. Through the differentiated arrangements in
terms of profitability and shareholding structure, STI has greatly enhanced the inclusiveness and adaptability of innovative enterprises.
• The restructured listing rule of STI will not only provide more financing opportunities to support high-tech innovative enterprises’
STI focuses on the following six types of high-tech industries and strategic emerging industries to promote the deep integration of the Internet, big data, cloud computing, artificial intelligence and manufacturing. Leading high-end consumption, promoting quality transform, efficiency transform, and power transform :
• In terms of market and financial conditions, STI introduced market cap indicators, combined with financial indicators such as revenue, cash flow, net profit and R&D investment, and set 5 differentiated listing standard (meet 1 out of 5), the existence of unrecovered losses is not a veto premise.
• For pre-revenue biotech companies, they must meet the main conditions of a market cap no less than RMB4 billion and at least one core pipeline to be approved for Phase II clinical trials.
Applicable industry
5 differentiated listing standard Standard
1
Standard 2
Standard 3
Standard 4
Standard 5
The estimated market cap ≥ RMB1 billion ANDThe aggregate net profit in prior two fiscal years ≥ RMB50 million, and each of the prior two fiscal years > RMB0 ORThe net profit in the previous fiscal year > RMB0 and the operating income ≥ RMB100 million
The estimated market cap ≥ RMB1.5 billion ANDThe operating income in the previous fiscal year ≥ RMB 200 millionAND The proportion of aggregate R&D investment in prior three fiscal years accounts for no less than 15% of the aggregate revenue in prior three fiscal years
The estimated market cap ≥ RMB2 billion ANDThe operating income in the previous fiscal year ≥ RMB 300 million AND The aggregate net cash flow from operating activities in prior three fiscal years ≥ RMB100 million
The estimated market cap ≥ RMB3 billion ANDThe operating income in previous fiscal year ≥ RMB300 million
The estimated market cap ≥ RMB4 billion. The main business or products need to be approved by the relevant state departments with a large market space and an initial results. Biopharma companies must have at least one core pipeline to be approved for Phase II clinical trials. Other companies accord with STI positioning need to have obvious technical advantages and meet the corresponding conditions
development, but also become an important listing platform for biotech companies following the Nasdaq and HKEX biotech sector. Moreover, it provides an alternative exit channel for PE/VC.
New generation of IT New material
High-end equipment manufacturing
New energy
Energy conservation and environment protection
Biotech
Source: Deloitte Analysis
Capital Market Review and Outlook | Capital market
11
5. Branded drug Biotech Companies have attracted attentionRecently, biotech companies such as Loxo Oncology, which are engaged in R&D of brand-name drugs with significant progress in R&D and commercialization, have attracted attention from the capital market.
• Founded in 2013, Loxo Oncology is a biotech company innovating the development of highly selective drugs for patients with genetically defined cancers. In December 2017, it initiated submission of a New Drug Application for LOXO-101 to FDA who received application and granted
priority review. LOXO-101 was officially approved in November 2018. The stock price fluctuated upwards as the market expected to rise after it passed the phase II clinical trial. On January 7, 2019, Eli Lilly announced that it would buy Loxo in full cash at a price of USD235 per share, with a total transaction value of USD8 billion.
• R&D driven biotech companies without marketed product may remain unprofitable for a long time, yet investors are still willing to give them a high valuation in reward for their sales expectations after pipelines got approved. The leading
R&D level of such companies in certain segments makes them often the preferred M&A targets for large pharma companies.
• Phase II/III of clinical trails are the key time nodes affecting valuation from perspective of the stock price performance of U.S emerging biotech companies. Along with partial clinical data of brand-name drugs (safety/effectiveness) been disclosed, investors are optimistic about the future marketization and licensing possibilities of new drugs, thereby driving up the valuation.
Loxo Stock Price after Reinstatement 2014-2019 (Currency: USD)0
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1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018
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79100
120139 143 147 144 147 153 166
182 193 209 219 218
100
150
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250
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Others Neulasta Prolia Xgeva
2018-08-01
2018-09-01
2018-10-01
2018-11-01
2018-12-01
2019-01-01
2019-02-01
2018-03-01
2018-03-08
Announced LOXO-101 data of Phase II
Submitted NDA to FDA
Eli Lily announced
acquisition with cash
LOXO-101 going public
Source: Capital IQ, Annual report
Capital Market Review and Outlook | Capital market
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6. The launching of brand-name drugs boosts performance upThere has been no lack of Loxo-like cases in history, such as Amgen, which was listed on U.S. stock exchange in 1984.
The company's performance did not change much before Neulasta went public in 2002, yet its market value fluctuated upwards from 1998 to 2002 with the positive expectations of Neulasta through phase III clinical trials.
Neulasta's performance after marketed is in line with investors’ expectations, the stock price is stable for a long time. With the rapid release of new drug sales, the company's EPS boosted, and the P/E multiple went downward.
Amgen's core products, Peugestin(Neulasta) and Denosumab(Prolia/Xgeva), were approved by the US FDA in January 2002 and June 2010, respectively.
From actual sales performance, both drugs are rapidly increasing and stabilizing at a high sales level every year. In 2017, Peugestin and Denosumab brought considerable revenue of USD4.53 billion and USD3.55 billion respectively.
From actual sales performance, both drugs are rapidly increasing and stabilizing at a high sales level every year. In 2017, Peugestin and Denosumab brought considerable revenue of USD4.53 billion and USD3.55 billion respectively.
Amgen Stock Price After Reinstatement 1990-2018 (US$)
Source: Capital IQ
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Others Neulasta Prolia Xgeva
2018-08-01
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Amgen Revenue Breakdown After Reinstatement 2002-2017 (US$Bn)
Source: Capital IQ, Annual report
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120139 143 147 144 147 153 166
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2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Others Neulasta Prolia Xgeva
2018-08-01
2018-09-01
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2018-11-01
2018-12-01
2019-01-01
2019-02-01
2018-03-01
2018-03-08
Neulasta Xgeva, Prolia going public
Capital Market Review and Outlook | Capital market
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Celgene Revenue Breakdown 1998-2018 (US$Mn)
Celgene Total Market Cap 1997-2019 (US$Bn)
Source: Capital IQ, Annual report
Source: Capital IQ
• In 1953, Thalidomide, produced by Chemie Gruenenthal, Germany, was officially launched as a sleep aid and was widely used in pregnant women to stop vomiting during pregnancy. In the early 1960s, reports a large number of infant malformations caused by this drug made the drug banned in many countries and withdrew from the pharmaceutical market.
• Celgene acquired Thalomid (Thalidomide) in 1992. With the development of research on leprosy, rheumatism and various types of malignant tumors, the drug has backed to market. The drug was approved by the US FDA in 1998 for the treatment of erythema nodosum leprosum (ENL). In May
2006, the drug was approved by the FDA for a new indications, multiple myeloma (MM). Thalomid has long occupied more than 90% of Celgene's total sales revenue after marketing, with a peak sales of $500 million. To prevent fetal exposure to fetus from this teratogenic drug, the company has developed a comprehensive program to control prescriptions, dispensing and drug use, the System for Thalidomide Education and Prescribing Safety (S.T.E.P.S) which was submitted to the FDA as part of the NDA. The company's patents based on S.T.E.P.S largely rule out the competition of generic drugs, so that a drug whose patent has expired still brings huge profit to the company.
• In 2005, the Revlimid (Lenalidomide), a new derivative of Thalidomide was successfully approved by FDA. The drug was rapidly occupying the US market with better efficacy and fewer side effects, becoming the company's new main source of income.
• Although offsetting some of Thalomid's sales share, the combined sales revenue of these two drugs is still beyond impressive, and the business model of acquiring drugs and improving it has made Celgene a big win. With the company's performance explosive growth. The company's total market cap is also rising in fluctuation, high recognition with a peak of more than $100 billion, reflecting the of the capital market for the company.
3 24 62 84 123 244 331 446 812 1,300 2,138 2,567
3,508 4,700 5,386
6,362 7,670
9,256
11,229
13,003 15,281
0%
25%
50%
75%
100%
Thalomid (Thalidomide) Revlimid (Lenalidomide) Total net product sales
19981999
20002001
20022003
20042005
20062007
20082009
20102011
20122013
20142018
20162017
2015
0
20
40
60
80
100
120
140
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
3 24 62 84 123 244 331 446 812 1,300 2,138 2,567
3,508 4,700 5,386
6,362 7,670
9,256
11,229
13,003 15,281
0%
25%
50%
75%
100%
Thalomid (Thalidomide) Revlimid (Lenalidomide) Total net product sales
19981999
20002001
20022003
20042005
20062007
20082009
20102011
20122013
20142018
20162017
2015
0
20
40
60
80
100
120
140
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
Capital Market Review and Outlook | Capital market
14
In the securities market, investors are willing to give high valuations to brand-name drug companies which brought excellent returns to investors. Behind this is the brand-name drug (especially the first-in-class drug) which has made a huge profit to the company by virtue of less competition and less price pressure during the exclusive period. This is unreachable for generic drugs or Me-too/Me-better drugs.
Abbott ‘s Total Market Cap Before and After the Spin-off 2009-2019 (US$Bn)
Note: The market value benchmark date is the first trading day of each year. Source: Capital IQ
83 84 74 8853 59 68 64 57
102 12255
83105 94 101
157 134
0
50
100
150
200
250
300
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Abbott Laboratories (Before Spin-off) Abbott Laboratories (After Spin-off) AbbVie Inc.
Post-Spin-off
AbbVie CAGR = 16%
Abbott CAGR = 15%
7. Capital markets has raised attention to brand-name drug companiesIn early 2013, AbbVie Inc., originally the brand-name drug division of Abbott Laboratories, successfully went public through a spin-off. After the spin-off, new Abbott retained its nutrients, medical diagnostics and generic drugs businesses, while AbbVie took away almost all of its patented drugs, including Humira, Niaspan, Creon and Tricor.
After spin-off, AbbVie focused on brand-name drug R&D, its R&D investment has been raised to the level
of leading pharmaceutical companies within a short period of time. The company has also patched up R&D inefficiency through cooperation. The two new companies formed after the spin-off of Abbott’s brand-name drug business better matched investors with different investment preferences.
Humira achieved the global sales #1 for six consecutive years after surpassing Plavix in 2012, continuously bringing high profits to the company. Viekira, a hepatitis C cocktail developed jointly by Albert and Enanta, was successfully open to sell in 2014, and investors’ confidence in the company has
increased significantly.
At the end of 2014, AbbVie’s capital market performance had a strong run, with a PE ratio of 53x. In the third year after established, AbbVie’s market value has exceeded Abbott's total market value before the spin-off with a CAGR of 16% in the past seven years. Shareholders‘ earnings are significant.market performance had a strong run, with a PE ratio of 53x. In the third year after established, AbbVie's market value has exceeded Abbott's total market value before the spin-off with a CAGR of 16% in the past seven years. Shareholders‘ earnings are significant.
Capital Market Review and Outlook | M&A Transaction
15
M&A Transaction
1. M&A Transactions Active in the Pharmaceutical and biotech Industry The overall global M&A transactions in pharmaceutical and biotech industry have increased in the past decade despite of volatility:
• It is expected that the scale of M&A in 2019 will further increase represented by the acquisition of Loxo Oncology by Eli Lilly with a deal value of 8 billion US dollars, the scale of biopharma companies’ M&A
increased significantly which mainly due to the structural and strategic adjustment needs of pharmaceutical companies, and the influence of media and public opinion. Increase of product lines, completion of industrial chain layout, and further consolidating market position remain the key motivations for M&A.
• In January 2019, Bristol-Myers Squibb announced the acquisition of Celgene, a biotech company for USD 74 billion. The deal value
was second only to the Pfizer/Warner-Lambert M&A transaction in 1999, making it the second largest transaction in the biopharmaceutical industry. In February of the same year, Roche announced to acquire Spark Therapeutics, the leader in gene therapy, for USD4.3 billion. The frequent M&A activities this year have made the M&A volume of the industry in the first two months of 2019 reach 57% of the whole year of 2018.
Capital Market Review and Outlook | M&A Transaction
16
Top 10 Transactions in the Global Pharmaceutical and biotech Industry since 2014
2. Large Pharmaceutical Companies Acquiring Biotech Companies have became a Key Driver in the M&A Market
Announcement Date
Bidder Target Deal Value (USD Million)
Type of Acquisition
Target Sub-Sectors
January 2019 Bristol-Myers Squibb
Celgene Corporation 89,489 100% biotech, pharmaceuticals – drug development and commercialization
May 2018 Takeda Pharmaceutical
Shire Plc 78,198 100% biotech, pharmaceutical
November 2014 Actavis plc Allergan, Inc. 63,199 100% Pharmaceutical – branded drugs and medical device research and development
July 2015 Teva Pharmaceutical Industries Ltd
Allergan plc (Generic Drug Business)
39,633 100% Pharmaceutical – generic drugs
January 2016 Shire Plc Baxalta Inc. 35,219 100% Pharmaceutical – drug development and commercialization
January 2017 Johnson & Johnson
Actelion Pharmaceuticals Ltd
29,592 100% biotech, pharmaceuticals – drug development and commercialization
February 2014 Allergan plc Forest Laboratories Inc
23,126 100% Pharmaceutical – drug development
February 2019 Danaher GE Healthcare Life Sciences (Biopharmaceutical Business)
21,400 100% biotech – drug R&D related instruments, consumables and software
March 2015 AbbVie Inc. Pharmacyclics Inc 19,045 100% biotech, pharmaceuticals – branded drug development
February 2015 Pfizer Hospira Inc 16,323 100% Pharmaceutical – biosimilar
2,04
86 74
116 111
228 232
150135
223
128
209257 248 256 275
358404 391
346405
45
2009
Value Volume
2010 2011 2012 2013 2014 2015 2016 20182017 2019-02-28
Value and Volume of M&A Deals in the Global Pharmaceutical and biotech Industry (US$Bn)
Source: MergerMarket, Deloitte Research
Source: Mergermarket, Deloitte Research
Capital Market Review and Outlook | M&A Transaction
17
In the past five years, most of the top ten global Pharmaceutical and biotech M&A in transaction scale concentrated in the field of branded drug R&D excepting the Israeli generic drug giant Teva's acquisition of Allergan's generics business and the Pfizer's acquisition of biosimilar company Hospira. Key drivers of such M&A transactions include acquiring new products to diversify product lines, expanding business coverage, deepening business globalization, and entering new business areas.
3. Large Pharmaceutical Companies Enhance Innovation through Frequent M&A
• As the growth of biosimilar drugs continues in recent years, pharmaceutical companies will inevitably face a decline in annual income of drugs after the exclusive period.
• Under the background of drug expenditure slowing down, large scale pharmaceutical companies have to
find a transformation in their “price driven” performance growth model. Drug development has long cycle, high risks, and requires a large amount of long-term investment. Smaller biotech companies or emerging biopharmaceutical companies are recognized with the ability to offer innovative products or technologies. Under such ecological environment, frequent M&A of pharmaceutical companies has become a trend.
Bristol-Myers Squibb's Acquisition of Celgene
On January 3, 2019, Bristol-Myers Squibb and Celgene jointly announced that the two parties have reached an acquisition agreement. Bristol-Myers Squibb will acquire Celgene for a total value of USD 74 billion (corresponding enterprise value of USD 89.5 billion), making it the largest M&A transaction in recent years. Bristol-Myers Squibb and Celgene are ranked third and fifth in the 2017 top ten companies by annual revenue in the field of tumor. With Bristol-Myers Squibb’s star product Opdivo and Celgene’s blockbuster Revlimid, the new Bristol-Myers Squibb is expected to take over the first place from Roche in the field of oncology. The Merger will also greatly strengthen Bristol-Myers Squibb’s business in immunity, inflammation and cardiovascular.
Lilly's Acquisition of Loxo
On January 7, 2019, Lilly announced that it will acquire Loxo Oncology, a company that develops genome-defined precise cancer drugs, for a total value of USD 8 billion. This has become the first major deal since Lilly’s new CEO Dave Ricks took office, which shows Lilly’s ambitions in the field of cancer-targeted drugs.
Roche's Acquisition of Spark Therapeutics
• On February 25, 2019, Roche Holding announced to acquire Spark Therapeutics, a leader in gene therapy, for USD 4.3 billion.
• Founded in 2013, Spark is a gene therapy company with a rich pipeline, covering hereditary eye diseases, hemophilia, lysosomal storage diseases, and neurodegenerative diseases: – Spark’s first gene therapy Luxturna, which treats children and adults with specific hereditary eye diseases, was approved in December 2017. Spark also works with Pfizer to develop Fidanacogene Elaparvovec for the treatment of hemophilia B, which has entered Phase Ⅲ in clinical trials. SPK-8011 for the treatment of hemophilia A is also expected to enter Phase Ⅲ in clinical trial this year.
• The acquisition of Spark Therapeutics can benefit Roche in making up for its shortcomings in the layout of gene therapy sector, and strengthening its hemophilia R&D department as a supplement to its heavyweight drug Hemlibra for the treatment of hemophilia A. Additionally, Roche faces a severe patent threat this year, which is also a key driver of its M&A: the patent of Rituxan, a key product for treatment of hematological cancer, has expired at the end of 2018 in the United States; the biosimilar drug Truxima, approved by EMA and FDA in July 2017 and November 2018, respectively, is expected to be officially launched in the first half of 2019; the other three heavyweights Avastin, Herceptin, and Tarceva will lose patent protection in 2019 in the United States, facing severe price cuts.
Capital Market Review and Outlook |Outlook and Key drivers
18
Outlook and Key drivers
Investment, financing and M&A activities in pharmaceutical and biotech industry will remain activeAs more biotech companies are listed on the HKEX, the biotech sector of HKEX will become more mature as the investors who prefer to biotech companies are gathered. while it is also expected to be in line with the US stock market, and we expect to observe there:
• Stronger IPO financing activities
• More active secondary market transactions
In addition with the mature US stock market and the establishment of the A-share Science and Technology Innovation board. The global investment and financing activities in pharmaceutical and biotech industry will remain active.
In terms of M&A, large pharma companies have been required to update their pipeline in response to price cuts and the adverse effects of patent cliffs. In addition, large pharma companies are generally better at addressing market sales and regulatory requirements of late stage drugs than emerging biopharma companies (EBP). Therefore, the heat of M&A activity drive by the patent-protected innovative drugs, will not be reduced.
Capital Market Review and Outlook |Outlook and Key drivers
19
1. The first-in-class drugs continue to receive attention from the capital market, whose can effectively reduce R&D risks and maintain market exclusivity will be favoredIn the field of brand-name drugs, concepts such as First-in-class, Me-better and Me-too are often used. Strictly speaking, those concepts are not precisely defined, yet they can be used for helping people to understand some characteristics by labeling brand-name drugs in a vivid way:
• Me-too/Me-better: In the case of breakthrough novel drugs with patent protection in the market, Me-too drug developers are looking for similar molecular structures that are not protected by patents based on the mechanism of action of this novel drug in order to achieve similar or even better efficacy. If the molecular structure changed is significant and
the compound has advantages in activity, metabolism, toxicity, etc., then this novel drug may be regarded as a Me-better drug.
• First-in-class: Unlike Me-too/Me-better, the First-in-class drug often has a major breakthrough in terms of mechanism of action, indications and molecular entities which can be analogized as New molecular entity (NME)/new chemical entity (NCE) described in FDCA's 505(b)(1) of FDA.
The First-in-class drugs will continue to draw attention from the capital market while it bring huge potential benefits to enterprises yet with less competition in the market, it also come under less pressure from the government, public opinion and supply/demand sides.
The First-in-class drugs are often the novel drug Global, and the huge benefits brought to enterprises are also
The First-in-class drugs are conspicuous in the context of the gradual growth of global drug spending, the market is increasingly eager to the approval of brand-name drugs. With the pressure of losses of exclusivity.
reflected in the global market returns, and will also be watched by the global capital market.
The main risk of the First-in-class drugs comes from long research and development time, huge R&D investment and high R&D risk. Therefore, companies that can effectively shorten the R&D cycle, save R&D investment or reduce R&D risk by its technology or business model will be favored.
In addition, it will bring more lasting benefits to the enterprise if the First-in-class drugs can prolong its patent protection period after commercialization, or maintain its market exclusivity through Orphan drug designation.
We have observed the following trends:
1 The first-in-class drugs continue to receive attention from the capital market, whose can effectively reduce R&D risks and maintain market exclusivity will be favored.
2 Specialty drugs, orphan drugs, biologics and oncology in novel drugs will continue to be the tendency.
3 Diversified cooperation between large multinational biopharma companies and EBP will lead to new excellent enterprises in the capital market.
4Brand-name drugs ushered in the era of globalization, biotech companies tend to gain global development right and quickly conduct clinical research in multi-centers around the world to capture more markets after drugs are approved.
Capital Market Review and Outlook |Outlook and Key drivers
20
687 733 721 727 751 743 768 789 830 871 927998
1,0691,134
1,204
0
200
400
600
800
1,000
1,200
1,400
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019F 2020F 2021F 2022F 2023F 2024F
Forecast
Global prescription drug sales, 2018–2024 (US$Bn)
Developed Markets Impact of Brand Losses of Exclusivity 2013–2022 (US$Bn)
-20 -21 -23 -24
-16
-31-27
-18
-24 -22
-40-35-30-25-20-15-10
-50
2014 2015 2016 2017 2018 2019F 2020F 2021F 2022F 2023F
Source: EvaluatePharma,2018
Notes: Developed markets include: U.S., Japan, Germany, France, Italy, U.K., Spain, Canada, S. Korea, AustraliaSource: IQVIA, 2019
$105Bn $121BnForecast
The market growth expectation is mainly due to the approval of novel drugs with flat growth of global drug spendingGlobal pharmaceutical spending is predicted to outpace overall health care spending. Global prescription drug sales are expected to rise from US$900 billion in 2019 to US$1.2 trillion by 2024. From 2019 to 2024, CAGR for prescription drug is expected to be 6.7
percent, or two times the 2.4 percent over 2011–2018.1
Drivers of growth are predicted to be novel therapies that address key, unmet needs and increased access to drugs.
The Chinese government has focused on managing drug pricing through the use of an Essential Drug List and a National
Reimbursement Drug List (NRDL).The NRDL had been updated with most recent in 2017 after an eight-year gap. The adoption of newer drugs from this updated reimbursement list will drive significant growth for brand-name drugs, while generic drugs (even Me-too drugs) will be subject to more intense competition and are expected to grow more slowly.
Losses of exclusivity (LOE) continues to put pressure on pharm companiesIQVIA expects that the expected impact of LOE for brand-name drugs in the developed markets is expected to peak in 2019, the impact of LOE in developed markets for small molecules will be larger in the next five years at $121 billion compared to $105 billion from 2014–2018, a 15% increase.2
Capital Market Review and Outlook |Outlook and Key drivers
21
2. Specialty drugs, orphan drugs, biologics and oncology in novel drugs will continue to be the tendencyIQVIA expects that between 2014 and 2018, the average spending on new brand-name drugs was $43.4 billion. New products launching between 2019 and 2023 are expected to have a slightly higher overall level of spending, approximately $45.8 billion.
Along with the increasing number of launches, the type of products
continues to shift to specialty, orphan, biologic and oncology products. Specialty is expected to represent nearly two-thirds of newly launched drugs over the next five years, and oncology approximately 30%.Orphan drugs could represent 45% of NME should the level of FDA orphan designations for in-progress research and breakthrough designations produce successful launches at current, historic rates.3
The increasing use of biomarkers to segment and treat appropriate patients will characterize more launches.
The increasing use of biomarkers to segment and treat appropriate patients will characterize more launches.
Under this trend, biopharma focusing on the above novel drug research will continue to be hot topics in the capital market and M&A market.
Developed Markets New Brand Spending and Share of Total Brand Spending Constant (US$Bn)
Average Number of Global NME Launches Annually per Period and Percentage of Launches by Type
14 1316 17 16
35
55 57
37 34 33
45
5551
46
0
10
20
30
40
50
60
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019F 2020F 2021F 2022F 2023F
38%
50%
61%
34% 37%44%
25% 25% 29%
17%23% 25%
3336
46
0
10
20
30
40
50
0%
Specialty Orphan Biologic Oncology Average Annual Global NME Launches
20%
40%
60%
80%
100%
2004-2008 2009-2013 2014-2018
Notes: New Brands defined as those launched less than two years previously, measured separately in each country as launches of the same products are at different times.Source: IQVIA, 2019
Notes: Percentages do not sum as segments are not mutually exclusive. NME = new molecular entity Source:IQVIA, 2019
Average = $15.3Bn Average = $43.4Bn Average = $45.8BnForecast
Capital Market Review and Outlook |Outlook and Key drivers
22
3. Diversified cooperation between large multinational biopharma companies and EBP will lead to new excellent enterprises in the capital market.Global large biopharm companies have descended R&D returnsAccording to Deloitte LLP, the R&D returns of novel drugs by large biopharma companies have fallen to the lowest level in nine years, only 1.9%. For multinational biopharma companies with annual investment of over US$10 billion, high-intensity R&D investment may not correlated with higher returns. Investors pay more attention to the company's current products, the potential growth of pipelines and future performances.4
EBP companies are increasingly taking their products to market on their own.According to the research of IQVIA, EBP are those with less than $500 million in revenue or with less than $200 million in R&D spending. Over the past decade, the percent of R&D activity being led by EBP companies has increased from 60% in 2009 to 72% through October 2018.
EBP companies are launching 68 NME over the past five years, up from 47 in 2009 to 2013.5
In this context, large biopharma companies will continue to form a variety of partnerships with EBP besides the current M&A trend.
10.1%
7.6% 7.3%
4.8%5.5%
4.2% 4.2% 3.7%
1.9%
0%
2%
4%
6%
8%
10%
12%
2010 2011 2012 2013 2014 2015 2016 2017 2018
Large Biopharma Company R&D Over Time
Source: Deloitte LLP, 2018
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2009
EBP Large Mid/Small
2010 2011 2012 2013 2014 2015 2016 2017 2018
Emerging Biopharma Company Launches Over Time
Notes: Segments defined at company level as: Large >$10Bn; Mid $5-10Bn; Small $500Mn-5Bn; Emerging Biopharma (EBP) <$500Mn OR R&D Spend <$200Mn. If multiple companies involved in a project, the larger segment takes precedence.Source: IQVIA, 2019
The decline in R&D returns has led to a significant division of labor between large pharma companies and EBP, with more and more R&D work being done by biotech companies.
Capital Market Review and Outlook |Outlook and Key drivers
23
Business Model 1: EBP could get a down payment and a potential milestone payment by developed in cooperation with large biopharma companies. These cash flows are critical for talent, R&D and operations before product launches.
Zai LabThe cooperation model between Zai Lab and the pharmaceutical company is to obtain R&D and commercial rights for the products in the Greater China region or the Asia-Pacific region through the payment of Royalty.
According to the public information, since 2014, Zai Lab has established its pipeline products through obtaining R&D and commercial rights from Sanofi, Bristol-Myers Squibb, Tesaro and etc. in the Greater China region.7
Innovent BiologicsAccording to public information, Innovent Biologics has twice reached strategic cooperation with Eli Lilly to obtain a total $3.3 billion in down payment and potential milestones:
• The companies will collaborate on three bispecific monoclonal antibody that target the protein PD-1 in an effort to unblind the immune system to malignancies in the body. In exchange
Business Model 2: By acquiring the rights within Greater China / Asia-Pacific region of late clinical stage pipeline from large biopharma. EBP can complete the clinical trial in China in a relative short period of time and achieving good returns.
Therapeutic area Pipeline Originator Region
Oncology Niraparib Tesaro Greater China
Optune Novocure Greater China
Margetuximab MacroGenics Greater China
MGD013 MacroGenics Greater China
FPA144 FivePrimes Greater China
ZL-2301 BMS Greater China
Infection Omadacycline Greater China
ETX2514 Asia-Pacific
Source: Company website
for Innovent's help, Eli Lilly is promising more than $1 billion in payments over the next decade, tied to development, regulatory and sales milestones.
• Under the new deal, Eli Lilly is on hand to develop and commercialize each treatment outside of China, while Innovent retains the local right. Innovent Biologics will receive additional sales commissions and other payments if the above
antibodies are successfully commercialized outside of China.
• In addition to its cooperation with Eli Lilly, Innovent Biologics has also collaborated with institutions such as Adimad to discover monoclonal antibodies.
Innovent Biologics has listed on HKEX in 2018.6
Capital Market Review and Outlook |Outlook and Key drivers
24
Denovo BiopharmaBased on its AI and big data biomarker platform, Denovo precisely searches for effective biomarkers for the global development of the first-in-class drug. The business mode for Denovo is to acquire the global rights of the late stage clinical drugs. Denovo’s technology enables biotech and pharmaceutical companies to design new clinical trials in a targeted patient population to achieve significant efficacy and/or less adverse effects by identifying biomarkers correlated to patients' responsiveness to drug candidates retrospectively.
According to public information, Denovo had acquired global rights of three first-in-class drug from Eli Lilly, Bristol-Myers Squibb and etc.
Business Model 3: The R&D for brand-name drug often link with a lengthy period and a massive investment. Pharma company usually had invested tons of money/time during clinical trial phase II/III in exchange for valuable clinical data. By acquiring the rights of the drugs that have not achieved required results in clinical trial Phase III, EBP can use their exclusive technology platform to complete the development in a relative short period of time at a lower cost, and achieve a long-term prosperous profit.
Therapeutic area Pipeline Indication Originator Region
Oncology Enzastaurin DLBCL Eli Lilly Global
GBM Eli Lilly Global
Psychiatry Pomaglumetad Schizophrenia Eli Lilly Global
Liafensine Depression BMS、AMRI Global
Source: Company website
• Enzastaurin, one of the pipeline in Denovo, with all global rights (including development, production and commercialization) acquired from Lilly, who conducted many clinical studies with Enzastaurin including phase III clinical trials in diffuse large B cell lymphoma (DLBCL) and glioma (GBM).
• Another first-in-class drug, Pomaglumetad, a novel schizophrenia drug that has been completed in phase II trials by Lilly.
Denovo has obtained all of its global rights including all approved materials, clinical data, patents and trademarks. It is expected that Phase III clinical trials will be launched in the near future.
• Denovo also obtained a global right (including global R & D, production and marketing) for Liafensine, the first-in-class drug for the treatment of resistant depression, from Bristol-Myers Squibb and AMRI. 8
Capital Market Review and Outlook |Outlook and Key drivers
25
SyneuRx International (Taiwan) Corp.The professional team of SyneuRx is composed of experienced professionals engaged in independent R&D of novel drugs for the treatment of diseases related to the central nervous system based on their early R&D results whilst they took employment in large well-known research institutions or academic centers.
Business Model 4: The professional team will conduct independent R&D of the first-in-class drugs from scratch based on their early R&D results whilst they took employment with large-scale well-known research institutions.
Source: Company website
Therapeutic area Pipeline Indication FDA Designation
Psychiatry SND11 Adolescent Schizophrenia Orphan drug
SND12 Refractory Schizophrenia Orphan drugBreakthrough therapy
SND13 Adult Schizophrenia Breakthrough therapy
SND14 Early Dementia
SND51 Dementia & Psychosis Symptoms
SNG12 Depression & Suicidality
SNA1 SNA1 Refractory Depression
According to the SyneuRx Prospectus, the intellectual property of its R&D pipeline was invented by the founders at the well-known research centers (Massachusetts General Hospital and UCLA), and many of the drugs under development have received orphan drug designation and breakthrough therapy designation by FDA, in which the Orphan Drug Exclusivity will last 7-7.5 years.
After the completion of Phase III clinical trial/NDA, SyneuRx will obtain high-value down payment, milestone payment and royalty after marketing through cooperation and out-licensing with multinational pharma companies.9
Capital Market Review and Outlook | Endnotes
26
1. World Industry Outlook, Healthcare and Pharmaceuticals, Economic Intelligence Unit, June 2018.
2. IQVIA Market Prognosis, Sep 2018.
3. IQVIA Market Prognosis, Sep 2018.
4. Deloitte UK measuring return on pharma innovation report 2018.
5. IQVIA Market Prognosis, Sep 2018.
6. Prospectus of Innovent Biologics Inc.
7. Zai Lab website: http://www.zailaboratory.com/
8. Denovo website: http://www.denovobiopharma.com/Chinese/
9. Syneurx website: http://www.syneurx.com/
Endnotes
Capital Market Review and Outlook | Contactors
27
Contactors
Carrie Chen Financial Advisory in Hong Kong-ChinaPartner, Asia Pacific LSHC Leader Tel: +86 10 85207801 E-mail: [email protected]
Saier Cheng Financial Advisory in Hong Kong-ChinaSenior Associate Tel: +86 10 85125087 E-mail: [email protected]
Yisi Qian Financial Advisory in Hong Kong-ChinaAssociate Director Tel: +86 10 85124218 E-mail: [email protected]
Louis Chang Financial Advisory in Hong Kong-ChinaAssociate Tel: +86 10 85205689 E-mail: [email protected]
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Shanghai 30/F Bund Center222 Yan An Road EastShanghai 200002, PRCTel: +86 21 6141 8888Fax: +86 21 6335 0003
ShenyangUnit 3605-3606, Forum 66 Office Tower 1No. 1-1 Qingnian AvenueShenhe DistrictShenyang 110063, PRCTel: +86 24 6785 4068Fax: +86 24 6785 4067
Shenzhen 13/F China Resources Building5001 Shennan Road EastShenzhen 518010, PRCTel: +86 755 8246 3255Fax: +86 755 8246 3186
Suzhou 23/F Building 1Global Wealth Square88 Su Hui Road, Industrial ParkSuzhou 215021, PRCTel: +86 512 6289 1238Fax: +86 512 6762 3338 / 3318
Tianjin 45/F Metropolitan Tower183 Nanjing RoadHeping DistrictTianjin 300051, PRCTel: +86 22 2320 6688Fax: +86 22 8312 6099
Wuhan Unit 1, 49/FNew World International Trade Tower568 Jianshe AvenueWuhan 430000, PRCTel: +86 27 8526 6618Fax: +86 27 8526 7032
Xiamen Unit E, 26/F International Plaza8 Lujiang Road, Siming DistrictXiamen 361001, PRCTel: +86 592 2107 298Fax: +86 592 2107 259
Xi’an Room 5104A, 51F Block AGreenland Center9 Jinye Road, High-tech ZoneXi'an 710065, PRCTel: +86 29 8114 0201Fax: +86 29 8114 0205
Beijing12/F China Life Financial CenterNo. 23 Zhenzhi RoadChaoyang DistrictBeijing 100026, PRCTel: +86 10 8520 7788Fax: +86 10 6508 8781
Changsha20/F Tower 3, HC International Plaza No. 109 Furong Road NorthKaifu DistrictChangsha 410008, PRC Tel: +86 731 8522 8790 Fax: +86 731 8522 8230
ChengduUnit 3406, 34/FYanlord Landmark Office TowerNo. 1 Section 2, Renmin South RoadChengdu 610016, PRCTel: +86 28 6789 8188Fax: +86 28 6500 5161
Chongqing 43/F World Financial Center, 188 Minzu Road, Yuzhong District, Chongqing 400010, PRCTel: +86 23 8823 1888Fax: +86 23 8859 9188
Dalian15/F Senmao Building147 Zhongshan RoadDalian 116011, PRCTel: +023 8823 1888Fax: +023 8857 0978
Guangzhou26/F Yuexiu Financial Tower28 Pearl River East RoadGuangzhou 510623, PRCTel: +86 20 8396 9228Fax: +86 20 3888 0121
HangzhouRoom 1206-1210East Building, Central PlazaNo.9 Feiyunjiang RoadShangcheng DistrictHangzhou 310008, PRCTel: +86 571 8972 7688Fax: +86 571 8779 7915 / 8779 7916
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