China’s 3SBio seeks US$400 million in Hong Kong to boost drug pipeline

Chinese drug maker 3SBio plans to raise HK$3.12 billion (US$401 million) by selling a 4.14 per cent stake in the company to fund clinical research in China and the US and expand the global reach of its drug portfolio.\nThe Shenyang-based biopharmaceutical firm has agreed to sell 105.1 million new shares at HK$29.62 each. The placing price represents a 6.5 per cent discount compared with Monday’s closing price of HK$31.68, according to its filing with the Hong Kong stock exchange on Tuesday.\nThe share placement follows strong investor appetite for 3SBio shares, which have soared more than fourfold so far this year.\n3SBio said the fresh capital was crucial for the research, development, manufacturing and marketing of its innovative therapy pipeline. About 80 per cent of the proceeds would be allocated to research and development-related expenditures, including advancing clinical research in China and the US for early-stage drug candidates, as well as expanding international markets for its commercialised products.\nThe remaining funds would support working capital and other general corporate purposes, the company said.\n3SBio’s shares fell 4.48 per cent to HK$30.26 on Tuesday morning.\nMorgan Stanley, hired as the sole overall coordinator for the deal, will place the new shares with at least six professional, institutional and other independent investors.\n3SBio’s flagship products include Tpiao, the world’s only commercialised recombinant human thrombopoietin for platelet disorders, and Mandi, a popular small-molecule drug for hair loss. Its drug pipeline features new candidates targeting the PD1/HER2 and PD1/PDL1 pathways – mechanisms commonly associated with cancer immunotherapies.\nThe fundraising comes after 3SBio spun off its hair-loss brand unit Mandi, which filed for an initial public offering in Hong Kong on November 20. Mandi has yet to disclose how much it plans to raise or when the listing will take place.\nThe spin-off will result in 3SBio completely exiting its stake in Mandi.\n