China's Innovent eyeing IPO this year—and could list in U.S.

U.S. fund manager Capital Group may be interested in a pre-IPO round

Chinese biotech Innovent Biologics is considering a $200 million IPO later this year that could take place in the U.S., according to media reports.

A Bloomberg article suggested that Shanghai-based Innovent is on the verge of another private investment round ahead of the IPO that could involve U.S. asset manager Capital Group, which has been looking out for opportunities to fund startups in emerging markets. Innovent is also considering listing in Hong Kong, it said.

In November, Innovent raised $260 million in a Series D financing, led by Future Industry Investment Fund (FIIF), which it said would help fund development of its 12 product candidates and broke previous funding records for a Chinese biotech.

Its pipeline includes several that have already started clinical testing and three which are in phase 3 trials, including a mix of novel biologics and biosimilars. It is also a couple of years into a $1 billion alliance with Eli Lilly focusing on three bispecific antibody candidates for cancer immunotherapy and headed by a PD-1 drug.

At the time, the biotech’s CEO Michael Yu, Ph. D., said that the cash injection would “enable Innovent to better leverage the emerging opportunity in China to quickly develop affordable and high-quality biologic products to treat Chinese patients.”

Both the company and Capital Group are staying tight-lipped about their plans for the moment.  

Innovent joins Shanghai-based Hua Medicine on the list of Chinese biotechs considering IPOs, with the latter considering making its debut on the Hong Kong Stock Exchange, according to the South China Morning Post. Hua is working on a diabetes drug—dorzagliatin (HMS5552), described as a first-in-class glucokinase positive allosteric modulator (PAM)—which is in phase 3 testing for Type 2 diabetes.

Hong Kong proposed changes to its IPO rules last month, which included relaxing the requirements for preprofit biotech companies, in a bid to attract more listings in an increasingly competitive global environment. A key objective is to attract “unicorn” companies like Innovent—startups with $1 billion valuations. The proposals are entering a public consultation phase.