After this stock issuance, it is planned to be listed on the science and innovation board market, which has high investment risk. Kechuang board company has the characteristics of large R & D investment, high operation risk, unstable performance and high delisting risk. Investors are facing greater market risk. Investors should fully understand the investment risks of the science and innovation board market and the risk factors disclosed by the company, and make investment decisions prudently.
Haichuang Pharmaceutical Co., Ltd
Hinova Pharmaceuticals Inc.
(No. 2 and 3, floor 4, building 1, Rongyao building, No. 5, Keyuan South Road, high tech Zone, Chengdu, Sichuan)
Initial public offering and listing on the science and Innovation Board
Letter of intent
Sponsor (lead underwriter)
(North block of excellence Times Square (phase II), No. 8, Zhongxin Third Road, Futian District, Shenzhen, Guangdong)
Statement and commitment
Any decision or opinion made by the CSRC and the exchange on this issuance does not indicate that they guarantee the authenticity, accuracy and completeness of the registration application documents and the information disclosed, nor do they indicate that they make substantive judgment or guarantee on the profitability, investment value of the issuer or the income of investors. Any statement to the contrary is a false statement.
According to the provisions of the securities law, the issuer shall be responsible for the changes in the operation and income of the issuer after the shares are issued according to law; Investors independently judge the investment value of the issuer, make investment decisions independently, and bear the investment risks caused by the changes in the operation and income of the issuer or the changes in the stock price after the shares are issued according to law. The issuer and all directors, supervisors and senior managers promise that the prospectus and other information disclosure materials are free from false records, misleading statements or major omissions, and bear individual and joint legal liabilities for their authenticity, accuracy and completeness.
The controlling shareholder and actual controller of the issuer promise that there are no false records, misleading statements or major omissions in this prospectus, and bear individual and joint legal liabilities for its authenticity, accuracy and completeness. The person in charge of the company, the person in charge of accounting and the person in charge of the accounting institution shall ensure that the financial and accounting materials in the prospectus are true and complete.
The issuer and all directors, supervisors, senior managers, controlling shareholders, actual controllers, sponsors and underwriting securities companies promise to compensate investors for losses in securities issuance and trading due to false records, misleading statements or major omissions in the issuer’s prospectus and other information disclosure materials.
The sponsor and the securities service institution promise to compensate the investors for the losses caused to the investors due to the false records, misleading statements or major omissions in the documents prepared and issued for the issuer’s public offering.
Overview of this offering
Type of shares issued: RMB ordinary shares (A shares)
The number of shares issued to the public by the company this time is 24760000, accounting for about 25.01% of the number of shares issued and issued: the proportion of post bank share capital is about 25.01%; The original shareholders of this offering will not offer shares to the public
The participation strategy of senior managers and employees of the issuer is not applicable to the placement:
The initial investment proportion of CITIC Securities Co., Ltd. in the public offering of securities will be 60 000 5% of the initial investment of CITIC Securities Co., Ltd, The number and amount of shares in this follow-up investment will be determined in accordance with Article 18 of the guidelines for the application of underwriting rules No. 1 – initial public offering of shares by subsidiaries related to the issuance of science and innovation board and the recommendation institution of Shanghai Stock Exchange, The final specific proportion and amount will be determined after the issuance price is determined on March 28, 2022 (T-2) Citic Securities Company Limited(600030) Investment Co., Ltd. has a restricted period of 24 months from the date when the shares issued to the public are listed on the Shanghai Stock Exchange
Par value per share: RMB 1.00
Issue price per share: [] yuan / share
Estimated issue date: March 30, 2022
Listed stock exchanges and sectors: Scientific Innovation Board of Shanghai Stock Exchange
Total share capital after issuance: 99015598 shares
Sponsor (lead underwriter): Citic Securities Company Limited(600030)
Signing date of the prospectus: March 22, 2022
Tips on major issues
The company reminds investors to carefully read the full text of this prospectus and pay special attention to the following important matters. In addition to the tips on major matters, the company specially reminds investors to carefully read all the contents of “section IV Risk Factors” in this prospectus. 1、 The company is a biomedical industry company adopting the fifth set of listing standards
Haichuang Pharmaceutical Co., Ltd. is an international innovative drug enterprise based on deuterated technology and protac targeted protein degradation technology platform, aiming at developing best in class and first in class drugs with major clinical needs. The company applies and complies with the listing standards specified in Item (V), paragraph 2, Article 22 of the examination rules for the issuance and listing of shares on the science and Innovation Board of Shanghai Stock Exchange: “The market value is expected to be no less than RMB 4 billion. The main business or products need to be approved by relevant state departments. There is a large market space and phased results have been achieved. Pharmaceutical enterprises need to have at least one core product approved to carry out phase II clinical trials, and other enterprises that meet the positioning of the science and innovation board need to have obvious technical advantages and meet the corresponding conditions.
”As an innovative drug R & D company that plans to adopt the fifth set of listing standards, the company reminds investors to pay attention to the following characteristics and risks of the company: (I) the company’s core products are still in the clinical stage, the company has not yet made a profit and is expected to continue to suffer losses
As of the signing date of this offering intention, the company’s core products are still in the clinical stage, and the production approval has not been obtained and the commercial production has not been realized. The company has not made a profit and has accumulated outstanding losses. By the end of 2020, the company’s accumulated undistributed profit was -388363200 yuan. In 2018, 2019, 2020 and January June 2021, the net profits attributable to the common shareholders of the parent company were -385787 million yuan, -1117046 million yuan, -4898495 million yuan and -1480836 million yuan respectively. After deducting non recurring profits and losses, the net profits attributable to the common shareholders of the parent company were -521983 million yuan, -1252698 million yuan, -4559238 million yuan and -1620546 million yuan respectively. As the company is expected to increase R & D investment in the future, it is expected that there will still be accumulated outstanding losses in the future. (II) the company still needs to continue to invest in the R & D of pipeline under research on a large scale
During the reporting period, the company invested a lot of money in preclinical research, clinical trials and listing applications of product pipelines. In 2018, 2019, 2020 and January June 2021, the company’s R & D expenses were 489345 million yuan, 116095 million yuan, 4289317 million yuan and 1280068 million yuan respectively. As of the signing date of this offering intention, the company’s product pipeline has 10 major drug projects under research, and reserves a number of projects under research at the early research stage. In the future, the company will still invest a large amount of R & D expenditure to promote the completion of preclinical research, clinical trial and listing application of the company’s products under research. According to the company’s accounting policy, the R & D expenditure of the company’s relevant drugs under research shall be expensed before obtaining the production approval. The capitalization accounting policy of the company’s R & D expenditure will further aggravate the company’s future losses and lead to a large number of operating losses in the foreseeable future. (III) the company is unable to ensure that its core products pass the clinical phase III test and obtain the listing approval, and its listing is uncertain
Due to the great uncertainty in clinical trials and new drug review and approval, the company cannot ensure that its core products pass the phase III clinical trials and obtain marketing approval. If the company’s core products fail to pass the clinical phase III test and obtain marketing approval, or such approval is conditional and has significant restrictions, or the approval time of the company’s core products is delayed compared with the company’s expectation, it will have a significant adverse impact on the company’s business operation. There is also uncertainty whether the company’s core products can successfully complete the phase III clinical trial within the expected time and obtain the approval of the regulatory authorities for listing. (IV) the company cannot guarantee to make profits in the next few years, and the company may also face delisting risk after listing
The company’s product pipeline has 10 major drug projects under research, and reserves a number of projects under research at the early research stage. In the future, the company will still invest a large amount of R & D expenditure to promote the completion of preclinical research, clinical trial and listing application of the company’s products under research. Before the listing of the company’s core products, the future operating losses will continue to increase. After the listing of the company’s core products, it is expected that the unprofitable state will continue for a period of time and may continue to expand.
As of the signing date of this offering intention, the company has only one product under development hc-1119 in clinical phase III, and one product under development hp501 has completed clinical phase II test and has not yet carried out clinical phase III test. At the same time, considering that the company’s core product hc-1119 is a deuterated drug of nzalutamide, and the generic drug of nzalutamide has been approved for listing in China at the end of August 2021. Although the approved indications of nzalutamide generic drugs are different from those of hc-1119 and phase III clinical in China, nzalutamide and its generic drugs may still compete with the company’s products. If the company’s core products fail to pass clinical phase III and obtain listing approval, or such approval is conditional and has significant restrictions, or the approval time of the company’s core products is delayed compared with the company’s expectation, or the sales of the company’s core products after listing fail to meet the expectation, the financial status in article 12.4.2 of the Listing Rules of Shanghai Stock Exchange’s science and Innovation Board shares will be triggered in the fourth full fiscal year from the date of listing, That is, if the audited net profit before or after deducting non recurring profit and loss in the latest fiscal year is negative and the operating income is less than 100 million yuan, or the net profit before or after deducting non recurring profit and loss in the latest fiscal year after retroactive restatement is negative and the operating income is less than 100 million yuan, the company may trigger delisting conditions.
At present, the company’s core products are still in the clinical stage. If they cannot pass the clinical trial or fail to obtain the drug registration certificate, or the sales situation of the products after listing is not ideal, and the clinical trial progress of other products under research is less than expected, the company may trigger the provisions of article 12.4.3 of the Listing Rules of Shanghai Stock Exchange science and innovation board, that is, the company’s main product research and development fails or fails to obtain the drug listing approval, If the company has no other business or products that meet the requirements of item 5 of article 2.1.2 of the Listing Rules of science and Innovation Board of Shanghai Stock Exchange, the delisting conditions of the company may also be triggered.
According to the measures for continuous supervision of listed companies on the science and Innovation Board (Trial), if the company touches the criteria for termination of listing, the listing of shares will be terminated directly, and the procedures of suspension, resumption and re listing will no longer apply. (V) it may be difficult for the company to achieve profit and loss balance for a period of time
The terminal treatment of metastatic castration resistant prostate cancer of hc-1119, a product with rapid research and development progress of the company, has been approved by nmpa to enter the clinical phase III trial in 2019 and is expected to be submitted to NDA in 2022; The first-line treatment of metastatic castration resistant prostate cancer has been approved by FDA and nmpa to enter the global multi center clinical phase III trial in 2019, and it is expected to submit NDA in 2023; The indication of hp501 single drug treatment for hyperuricemia / gout has entered the clinical phase II trial in 2020. It is expected to start the clinical phase III trial in 2021 and submit NDA in 2023.
The above two products of the company are still some time away from being approved for listing, and even if the company’s products are successfully approved for listing, the sales volume may not increase significantly immediately in a period of time at the beginning of new drug listing. In the process of market development, if the company’s products cannot be accepted and recognized by the market quickly, it may not reach the expected sales scale for a period of time. Due to the high investment in production, sales, R & D and other business activities of the issuer, the large amount of relevant costs and expenses, and the high amount of sales revenue at the breakeven point of the issuer, the issuer may be difficult to achieve breakeven for a period of time. 2、 Risk that the company may not be able to continue to develop deuterated drugs other than the existing product line in the future
One of the core technology platforms independently developed by the company is the deuterated drug research and development platform. Deuterated technology has been widely used in drug research and development, including small molecule candidate new drugs such as hc-1119 and hp530. However, deuterated technology has high requirements for production technology and quality control technology, and the raw material cost is relatively high, which leads to the relatively high production cost of deuterated drugs; Deuterated drugs unless new indications are developed
