--- title: "A first in Hong Kong's 18A! Edding Pharm reverse acquisition of Genor Biopharma, what 'little schemes' are they each harboring?" type: "Topics" locale: "en" url: "https://longbridge.com/en/topics/29000703.md" description: "A new paradigm for capital operation in Hong Kong stocks taking shape? According to reports, Genor Biopharma recently submitted a listing application to the Hong Kong Stock Exchange, with Morgan Stanley and SPDB International as joint sponsors. Notably, Genor Biopharma had already listed on the Hong Kong stock market back in 2020. This renewed application stems from a reverse merger event. Last October, Genor Biopharma announced that it had entered into a merger agreement with Eddingpharm. Under the agreement, Eddingpharm, valued at $677 million, will merge with Genor Biopharma, valued at $197 million, through a share swap..." datetime: "2025-04-17T13:15:07.000Z" locales: - [en](https://longbridge.com/en/topics/29000703.md) - [zh-CN](https://longbridge.com/zh-CN/topics/29000703.md) - [zh-HK](https://longbridge.com/zh-HK/topics/29000703.md) author: "[医药研究社](https://longbridge.com/en/profiles/15545088.md)" --- # A first in Hong Kong's 18A! Edding Pharm reverse acquisition of Genor Biopharma, what 'little schemes' are they each harboring? A New Paradigm for Capitalization in Hong Kong Stocks? According to reports, Genor Biopharma recently submitted a listing application to the Hong Kong Stock Exchange, with Morgan Stanley and SPDB International as joint sponsors. Notably, Genor Biopharma had already listed on the Hong Kong stock market in 2020, and this reapplication stems from a reverse merger event. In October last year, Genor Biopharma announced that it had entered into a merger agreement with Eddingpharm. Under the agreement, Eddingpharm, valued at $677 million, merged with Genor Biopharma, valued at $197 million, through a share swap. The merged entity was renamed "EddingGenor Pharmaceutical Group Limited," with Eddingpharm shareholders holding 77.43% and Genor Biopharma shareholders holding 22.57%. The actual controller of Eddingpharm also became the controlling shareholder of the merged company. After about six months, the collaboration has finally progressed to the listing stage. From a capital market perspective, the strategic merger between Genor Biopharma and Eddingpharm is undoubtedly groundbreaking—it marks the first reverse merger case for an innovative biotech company since the Hong Kong Stock Exchange introduced Chapter 18A rules. Reports indicate that after the merger announcement, Genor Biopharma's stock price surged over 93% in a single day, setting a yearly record for the Hong Kong biotech sector. For both companies, this merger is far from a simple "addition." The "mutual pursuit" between Genor Biopharma and Eddingpharm stems from their respective needs. Simply put, the former requires commercialization support, while the latter needs R&D reinforcement. **Genor Biopharma: Urgent Need to Open Commercialization Channels** Genor Biopharma primarily focuses on potential FIC (first-in-class) and BIC (best-in-class) innovative pipelines, with over 10 product combinations in oncology and autoimmune diseases, including GB491 (lerociclib), GB261, GB242 (infliximab), GB223, and GB241 (rituximab). However, most of these products are still in clinical stages, with only GB242 having received NDA approval and nearing commercialization. To stabilize performance, the company relies on BD collaborations and cost-control measures. For example, according to financial reports, Genor Biopharma's 2024 revenue of RMB 206 million was largely due to a licensing and equity agreement with TRC 2004, Inc. Under the licensing agreement, Genor Biopharma granted TRC 2004, Inc. global exclusive rights (excluding mainland China, Hong Kong, Macau, and Taiwan) to develop, use, manufacture, commercialize, and otherwise utilize GB261 (CD20/CD3 bispecific antibody). The collaboration will primarily explore GB261's potential in autoimmune diseases. In return, Genor Biopharma received a significant equity stake in TRC 2004, Inc., an upfront payment in the tens of millions of dollars, milestone payments of up to $443 million, and tiered royalties ranging from single-digit to double-digit percentages of net sales. Additionally, due to a 64.1% year-on-year reduction in R&D expenses to RMB 202.8 million, Genor Biopharma's net loss in 2024 narrowed by 92.2% to RMB 52.974 million. Despite overall performance improvements, Genor Biopharma's commercialization channels remain unopened. The company recognizes that accelerating product launches and achieving growth require support from a pharmaceutical company with extensive commercialization experience. Through this strategic collaboration, Eddingpharm fills the commercialization gap for Genor Biopharma. **Eddingpharm: Strengthening the Technological Moat** Eddingpharm's value lies in its commercialization capabilities. The company has built a diversified product portfolio, including three commercialized original products (Vancomycin, Cefaclor, and Edingping) and three innovative patented drugs (Vespa, Venkoda, and Jingzhuda), covering high-demand therapeutic areas. For instance, Edingping targets asthma. A study published in \*The Lancet Respiratory Medicine\* estimated 260 million asthma patients globally in 2021, projected to reach 275 million by 2025. Given this demand, Eddingpharm has been expanding its market presence in recent years. Reports indicate that Eddingpharm has 1,000 sales representatives across 31 Chinese provinces, covering approximately 17,000 hospitals, 19,000 pharmacies, and 225 commercial companies. Disclosures show that Eddingpharm's revenues for 2022-2024 were RMB 2.074 billion, RMB 2.304 billion, and RMB 2.546 billion, respectively, with annual profits of RMB 306 million, RMB 308 million, and RMB 388 million during the same period. Notably, Eddingpharm's products are largely acquired or licensed, reducing drug development risks and enabling faster commercialization. However, this model also reflects a lack of a technological moat, raising concerns about "hollowing out." Thus, building an ecosystem from innovation to market is a critical step for Eddingpharm's development, leading to this strategic collaboration. Eddingpharm stated: "We value Genor's expertise in target discovery and clinical translation, which will accelerate the industrialization of innovative outcomes." From Eddingpharm's perspective, beyond operational synergies, partnering with Genor Biopharma also serves to "fulfill a listing dream." LiveReport data shows that Eddingpharm first submitted a listing application to the Hong Kong Stock Exchange on September 23, 2020, and reapplied on June 23, 2023, receiving a filing notice from China's securities regulator on December 20, 2023—but no further progress was made. In this context, Eddingpharm's reverse merger with Genor Biopharma represents a novel approach to pharmaceutical capitalization—achieving a backdoor listing. **Conclusion** The strategic collaboration between the two companies is essentially a business reinforcement plan, aimed at forming a complete "R&D-production-sales" loop to expand growth opportunities. The effects will first manifest in their product pipeline. Genor Biopharma's financial report notes: "Eddingpharm's Jingzhuda (an HDAC inhibitor for HR+/HER2- breast cancer) is expected to synergize strongly with our core product CDK4/6i in commercialization and treatment. Given Eddingpharm's well-established sales network and comprehensive production system, the proposed merger, if realized, will significantly enhance the success of CDK4/6i's future commercialization." Zooming out, amid the challenging Chapter 18A environment in Hong Kong, such 良性互动 (beneficial interactions) are sorely needed to optimize resource allocation and improve the industry ecosystem. Investors are eager for more innovative narratives in capital operations. 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