Nasdaq exec says biotechs prime Asian unicorns for listings

Print 23 March 2016
EJ Lane / FeircePharmaAsia

With Hong Kong-based Hutchison China Meditech (Chi-Med) listing shares on the Nasdaq this week, a top executive at the exchange says more biotechs in Asia should head his way to become the next unicorns from the region.

Speaking in Seoul to the Wall Street Journal, Bob McCooey, senior vice president for listing at Nasdaq, said the hunt is on for startups both inside and outside of China with the attraction of great valuations, for now, and rattles off that 5 of the 8 initial public offerings (IPOs) this year in the U.S. have been in the biotechnology sector and all on Nasdaq.

That includes Beijing-based BeiGene ($BGNE) which in January raised $158.4 million in a volatile global market setting. The American Depositary Share (ADS) offer came in at the top of the range at $24 each. It closed on Tuesday at $26.92 per ADS and has hit a high of $35.60 and a low of $22.51 since its debut, with the overall valuation hovering around $1 billion.

This week, Chi-Med, not a startup anymore and already listed in London, sold 7.5 million ADSs at $13.50 apiece, representing one-half of one ordinary share, to raise $101.25 million. Trading begins March 17 on the Nasdaq under the ticker symbol HCM.

For McCooey though the question is whether growth in the listing business is "transitioning to outside China," he told the WSJ.

That turns attention to South Korea-based biosimilar maker Samsung Bioepis which hired lead managers for a U.S. listing next year as the joint venture between Samsung Group and Biogen ($BIIB) looks to raise as much as $1 billion to fund development of biosimilars that will compete with some of the world's best-selling drugs.

McCooey told the WSJ he would not comment on Samsung Bioepis, but did say biotechnology firms are in favor now.

"We are known for biotech, and we've done a good job of supporting these companies," McCooey told the WSJ.

To be sure, several Chinese firms have given up public listings in the U.S. in the past two years, often in management-led buyouts with Shanghai-based WuXi PharmaTech a notable recent play last year. But the firm is now finalizing plans for a $1.5 billion deal to list its biologics unit.

But McCooey told the WSJ that the stability of U.S. markets relative to China would remain a draw.

"When the market goes up 90% and you think you can list them higher in the domestic market, then when the market drops 50% you realize that there's some risk to that transaction," he told the WSJ.

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