IPO | Chuangsheng Group-B launches a stock offering and receives cornerstone investments from Temasek and Eli Lilly Asia Fund

Futu News, September 14, this Tuesday$TRANSCENTA-B (06628.HK)$ The announcement was announced that it will issue 40.33 million shares from September 14 to 17. The company plans to issue 40.33 million shares, including a public sale of 4.033 million shares and an international sale of 36.297 million shares, with an issue price of HK$15.8-16.0 per share, and 500 shares per lot. It is expected to be listed on September 29.

Chuangsheng Group is a clinical-stage biopharmaceutical company integrating discovery, research, development, manufacturing and business development capabilities. As of the last practical date, the company has independently discovered and developed eight of the nine drug candidates, covering proven, partially verified and novel biological pathways.

The core product is MSB2311 (a humanized PD-L1 monoclonal antibody (monoclonal antibody) candidate drug for solid tumors). The company submitted the first phase analysis report to the State Drug Administration in January 2021.

The only authorized drug candidate is Blosozumab (TST002) (a humanized osteochondrosis monoclonal antibody candidate for the treatment of osteoporosis), which was authorized to introduce the drug in Greater China in 2019.

Notably, the company is supported by world-renowned strategic investors and specialized funds focused on biotechnologyShareholders include Eli Lilly Asia Fund, Temasek, ARCH Ventures Partners, China State-owned Enterprise Structural Adjustment Fund, Teng Yue Partners, Collin Capital, and Sequoia Capital China Fund.

In terms of financial data, the companyThere are currently no products approved for commercial sale, so no product sales revenue has been generatedMost of its revenue comes from providing CDMO services to customers (mainly pharmaceutical and biotech companies) under CDMO contracts.

The company did not make a profit during the track record period and generated operating losses. In 2019, 2020 and the first three months of 2021, the company achieved revenue of RMB 44.14 million, RMB 80.98 million and RMB 7.883 million, and recorded total annual expenses of RMB 438 million, RMB 320 million and RMB 71 million respectively during the same period.

On the industry side, cancer antibody drugs usually show more obvious efficacy and lower toxicity in cancer treatment than traditional treatments such as chemotherapy and radiotherapy. The global and Chinese oncology antibody drug markets are expected to reach US$176.2 billion and US$26.5 billion respectively in 2030.

In terms of Cornerstone investors, several Cornerstone investors agreed to subscribe for the number of shares to be subscribed at the sale price, totaling approximately US$68 million, including LAV, Temasek, QIA, and the China State-owned Enterprise Structural Adjustment Fund.

In terms of funding use, the company's net proceeds amounted to $571 million (based on the median issue price, assuming that the over-allotment rights were not exercised). According to the prospectus, the company intends to use the net proceeds from the sale of shares for the following purposes:

82% is used for research and development of candidate products in the company's pipeline, funding for ongoing and planned clinical and pre-clinical trials, preparation for registration and filing, and other steps or activities related to the commercial company's four main products;

8% is used to allocate capital for business development to expand pipelines and develop technology;

10% is used for general working capital and general operating expenses.

Northern/Aurora

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