The Burrill Report


China National Biotech Group, a subsidiary of state-owned China National Pharmaceutical Group, or Sinopharm Group, is planning to raise $1.5 billion to $2 billion in an initial public offering in Hong Kong in the first half of 2012, according to various reports.

ChinaBio Today reported the company would seek to go public and change its name to China Biotech. It attributed its information to Zhiping Song, chairman of Sinopharm Group. A separate report from the International Financing Review placed the size of the IPO at between $1.5 billion to $2 billion, but cited unnamed sources for its story.

China National Biotech Group is China’s largest biotech company and the world’s fourth largest maker of vaccines and blood products. It is comprised of six institutes located in major Chinese cities and makes more than 200 drugs, vaccines and diagnostics. The company also collects about 25 percent of China’s total output of plasma. In 2010, it reported $789 million (5 billion RMB) of revenue and profits of $114 million (722 million RMB).

In September 2009, Sinopharm staged a successful IPO for its drug distribution joint venture with Fosun Group, SinoPharm Holdings, raising $1.1 billion on the Hong Kong exchange and jump starting a wave of healthcare IPOs in China. In 2011, 33 life sciences companies raised $5.9 billion.

Although activity has cooled in 2011, to date 11 companies have completed initial offerings this year to raise a total of $1.3 billion. Public companies have also raised $3.4 billion in secondary offerings and $521 million in private placements in 2011.

Besides China National Biotech and SinoPharm Holdings, the parent SinoPharm Group owns 15 subsidiaries that include four companies listed on the Shanghai exchange.
Sinopharm has hired China International Capital, Morgan Stanley, and UBS to manage the IPO, according to International Financing Review’s sources.


November 11, 2011
http://www.burrillreport.com/article-china%e2%80%99s_largest_biotech_plans_ipo.html