On Monday, according to media reports citing people familiar with the matter, Fosun Pharmaceutical is considering a privatization acquisition of Fuhong Hanlin, which is listed on the Hong Kong stock market.
People familiar with the matter said that Fosun Pharmaceuticals is cooperating with a consulting agency on a potential privatization offer plan, and other investors may also join the deal. Fuhong Hanlin is a holding subsidiary of Fosun Pharmaceutical. Fosun Pharmaceutical holds 53.61% of Fuhong Hanlin's total share capital.
Since May 23, Fu Hong Hanlin has suspended trading on the Hong Kong Stock Exchange, pending the announcement of the merger and acquisition. Negotiations on the deal are still ongoing, and it remains to be seen whether a deal will actually be reached in the future.
Fuhong Hanlin's stock price has risen 73% in the past 12 months, but it is far below its peak level in 2020. The company's current market capitalization is about 1.3 billion US dollars, which is a sharp decrease from the market value of 4.2 billion US dollars in July 2020.
Fosun Pharma's stock trading was also suspended on May 23, then resumed trading for two days. Over the past 12 months, Fosun Pharmaceutical's stock price has fallen by nearly 40%. Fosun Pharmaceutical is a subsidiary of Fosun International, which has been selling assets after years of global expansion.
Judging from the background of the transaction, this may be one of the measures taken by Fosun Pharmaceutical to achieve a focused development strategy.
By privatizing Fuhong Hanlin, Fosun Pharmaceutical can more efficiently integrate its biotech assets, and for Fuhong Hanlin, this deal is expected to inject new capital and development momentum into Fuhong Hanlin.
Last year, Fuhong Hanlin achieved annual profit for the first time, with net profit of 546 million yuan and revenue of 5.395 billion yuan. Fu Hong Hanlin mainly produces drugs in the fields of oncology, autoimmune diseases, and ophthalmic diseases. As of the end of March, it had 5 products in China, and 2 products were sold overseas. In 2023, Fuhong Hanlin's five products achieved total sales revenue of about 4,553.5 billion yuan, of which PD-1 oncology drug slulilizumab (H drug, Hans-like) had annual revenue of 1,119.8 billion yuan, a significant increase of 230.2% over the previous year.
It is worth mentioning that Fuhong Hanlin is going overseas at an accelerated pace. It successfully landed in Indonesia in December of last year, becoming the first domestically produced anti-PD-1 monoclonal antibody to be shipped overseas; recently, the trutuzumab biosimilar drug produced by Fuhong Hanlin (Han Quyou) was approved for marketing in the US.