Chinese drug developer Ascletis files for landmark HK IPO

The size and pricing of the offering have yet to be decided. C-Bridge holds an 11.6% stake in the company, while Goldman Sachs has 4%. The two investors led Ascletis’ Series A round in 2014, contributing $35 million and $20 million, respectively.

C-Bridge also brought in two of its LPs as co-investors, Tasly Pharmaceuticals and Temasek Holdings-owned Pavilion Capital. Tasly then re-upped for the $100 million Series B round in early 2017 – alongside C-Bridge and Goldman – and the drug developer now has an overall interest of 1.5%. Qianhai FoF, which participated in the round as a new investor, has 2%.

Ascletis was founded in 2013 by Jinzi Wu, who previously worked at GlaxoSmithKline. The company’s current focus is chronic hepatitis C, for which it is developing two direct-acting antiviral agents, Danoprevir and Ravidasvir, licensed from Roche and Presidio Pharmaceuticals, respectively.

Danoprevir was accepted by the China Food & Drug Administration at the end of 2016 and scheduled to be launched – under the brand name Ganovo – by the third quarter of this year. Ravidasvir, which has completed its phase-three clinical trials, is expected to submit a new drug authorization filing with the Chinese regulator around the same time.

The company is also working on treatments for HIV, liver cancer, and fatty liver disease. It posted a net loss of RMB131.8 million ($20.7 million) for 2017, up from RMB6.76 million the previous year. Rising R&D costs were primarily responsible. The proceeds from the IPO will go towards further R&D, as well as increasing manufacturing capacity, and building a commercialization team.

Hong Kong started to loosen its listing requirements earlier this year with a view to attracting more IPOs from China. In addition to introducing weighted voting rights – which allow founders to retain control of companies even after their equity interest has fallen below 50% due to new share sales – it decided to accept pre-profit companies. For now, these can only be biotech players.

C-Bridge’s equity commitments to Ascletis came from its second fund, which closed last year at the hard cap of $400 million. The firm seeks to invest about 50% of its capital in pharmaceuticals and the rest in medical devices and healthcare services. There is also a tendency to back businesses with a clear path to commercialization and monetization.

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• Topics
• Greater China
• Healthcare
• IPO
• Hong Kong (China)
• China
• C-Bridge Capital
• Goldman Sachs