WuXi AppTec prepares IPO for core drug R&D operation

Closeup of stock prices
WuXi AppTec is seeking an IPO for its core businesses. (Getty/Pashalgnatov)

WuXi AppTec is seeking an IPO for its drug R&D businesses on China’s common stock market, a move that confirmed buzz that the CRO giant would re-enlist its businesses in three pieces.

The company made the announcement in a release (Chinese) last week, saying that it’s receiving listing counseling services from Chinese firm Huatai United Securities.

For this IPO, WuXi is rounding up its core businesses including pharmaceutical discovery, genome testing and immunotherapy development, among other precision medicine sections, which combined could be valued as the largest drug R&D business in China, according to China’s financial news outlet Yicai (Chinese).


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The company’s decision to initiate a normal IPO contradicts with some Chinese media outlets’ previous speculation that the company would seek a reverse merger for its core services.

Yicai cited a source familiar with the deal that the CRO chose an IPO based on tightened policy on reverse merger and the fact that the regulatory agency is speeding up evaluation for IPOs, a process that could take two to three years.

WuXi AppTec was formerly listed on the New York Stock Exchange as WuXi PharmaTech until management took the company private in December 2015 with a $3.3 billion valuation. 

In a draft listing application for its China-based biologics unit filed to Hong Kong Stock Exchange in early January, the company explains the reasoning to the U.S. stock market withdrawal as the “management team can focus more on improving the company’s long-term financial performance.” That was in line with WuXi head Ge Li’s previous comment that Wall Street focuses too much on short-term results, making it hard for the company to make strategic long-term investments.

That HKEX IPO would value WuXi Biologics at around $1.5 billion, according to a previous report by Bloomberg.

Besides WuXi Biologics, WuXi’s API development and manufacturing subsidiary, STA (Syn-The-All), is currently traded on China’s new OTC market, with a total value of about 15.61 billion Chinese yuan ($2.27 billion).

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