From September 27th to 28th, 2023, the 2nd New Investment Expo and the 17th Frost & Sullivan Global Growth, Innovation and Leadership Summit (referred to as the 'Frost & Sullivan New Investment Conference' or 'Conference') Life Sciences New Investment Summit Forum was grandly held at the Shangri-La Hotel in Pudong, Shanghai. Dr. Wang Xin, Global Partner at Frost & Sullivan and Chairman of the Greater China Region, delivered a welcome speech for the forum.
The following are the key points of Dr. Wang Xin's speech:
The development of biotech companies cannot do without capital support.
Over the past decade, the development of Chinese biotechnology companies has essentially been like crossing a river by feeling the stones. The rapid market explosion began in 2018 when the Hong Kong Stock Exchange issued Chapter 18A, which made Biotech companies an example. From the second half of 2018 to the first half of 2021, Biotech companies conducted a flurry of IPOs. However, a rough estimate might better explain the current situation faced by biotechnology companies in the capital market. It takes an average of two years for a Biotech company to go public on the Hong Kong Stock Exchange and for its first product to be launched; it takes an average of 3 to 5 years for cash flow to turn positive; currently, over 85% of Biotech listed companies are still in a loss-making state. In other words, a large number of listed and pre-listed companies still have a long way to go before becoming giants in biotechnology.
Capital investment is an indispensable and important factor in helping biotech companies grow, and it is crucial for driving research and development and accelerating the commercial success of the life sciences industry.
Since the first half of 2022, there have been certain fluctuations in global and Chinese capital markets. As of August 31, 2023, among the 43 Hong Kong-listed biopharmaceutical companies with no profit for the year 2022, 26 have released their semi-annual reports; based on the 'three expenses' disclosed in the 2023 interim reports, as well as the current total cash and cash equivalents of the companies, it is possible that 9 out of the 26 companies may not be able to sustain operations for 2 years, but there are also 6 companies that can maintain operations for more than 5 years. Some companies even have to consider closing some promising pipelines or even selling off their core products.
In the face of the inevitable cyclical nature of the industry, to find more certain investment opportunities in the biotechnology field, it is necessary to conduct long-term and continuous in-depth research on technical trends, policy changes, and industry dynamics in the biotechnology sector, and to keenly capture market fluctuations.
2023 marks the 45th anniversary of China's reform and opening up, the tenth anniversary of the launch of the 'Belt and Road' initiative, the 62nd anniversary of Frost & Sullivan's global establishment, the 25th anniversary of its entry into the Chinese market, and also the fifth anniversary of the establishment of the original content platform LeadLeo.
As a global growth consulting firm, Frost & Sullivan integrates 62 years of consulting experience and has been serving the booming Chinese market with dedication for 25 years. It has helped over 10,000 clients accelerate their business growth, assist them in achieving growth, innovation, and leading benchmarks within their industries, and realize capital operation goals such as financing and listing. In the past decade, Frost & Sullivan has consistently ranked first in market share as an industry research advisor for Chinese companies listing in Hong Kong and overseas, and is also an absolute leader in serving biotech companies listing in Hong Kong. Since the first batch of companies on the Sci-tech Innovation Board (STAR Market) were listed in July 2019, Frost & Sullivan's reports have also been widely cited in the prospectuses of leading STAR Market-listed companies.
Digital technology drives the transformation and upgrading of biotech enterprises
Dr. Wang Xin pointed out that currently, the global economy is showing a steady recovery trend. As an important part of the global economy, the digital economy is rapidly driving the deep integration of various industries. The rapid development of new-generation digital technologies represented by big data, cloud computing, and artificial intelligence is transforming the biotechnology field. In the field of biotechnology, AI empowers drug discovery, supercomputing has effectively accelerated the construction process of smart healthcare in China, and big data and models drive the development of intelligent medicine. In the future, the development of AI and digitization will drive the transformation and upgrading of traditional healthcare industries.
The life science sector has always been one of the core areas of focus for Frost & Sullivan. Over the past 20-plus years, the Frost & Sullivan team has provided financing financial advisory, IPO industry advisory, strategic consulting, management consulting, and other services to hundreds of outstanding domestic and international biopharmaceuticals, medical devices, healthcare services, and internet healthcare companies.
Frost & Sullivan keeps a close eye on the development trends of the capital market. We not only have rich industry data but also real-time transaction data. The Frost & Sullivan Jolley Biotechnology Index series systematically reflects the overall performance of biotechnology companies listed in Hong Kong and continues to provide an important reference for the capital market.
In the past two years, Frost & Sullivan has collaborated with Frost & Sullivan TradeGo (Shenzhen) Cloud Technology Co., Ltd., TradeGo, and LeadLeo Research Institute to co-publish reports such as 'Investment Activity Report on the Issuance of Hong Kong 18A Biotech Companies', 'China's Consumer Healthcare Series Reports', 'China's Specialized Hospital Service Series Reports', and 'Hong Kong IPO Market and Secondary Market White Paper'. Since their release, these reports have received widespread attention and praise from various sectors. At this conference, Frost & Sullivan will jointly release with TradeGo and LeadLeo Research Institute the '2023 Hong Kong 18A & Sci-Tech Innovation Board Biotech Industry Development Blue Book'. This blue book systematically summarizes all aspects of the listing activities on the entire Hong Kong 18A & Sci-Tech Innovation Board, especially focusing on the listing and subsequent financing of companies listed on both sectors.
For a long time, Frost & Sullivan has joined hands with professionals from industry, academia, research institutions, and investment sectors to strive for joint efforts and collaboration with all sectors of society. Adhering to the concept that "many hands make light work," we aim to achieve high-level coordination among all stakeholders, providing integrated service solutions for enterprise development. Together, we aim to help Chinese biotech companies achieve growth and empower the transformation and upgrading of the biotech industry.
Frost & Sullivan — Empowering 'New Investments' at Scale
As one of the most powerful, professional and influential comprehensive industry research institutions in the sector, Frost & Sullivan has always been committed to helping enterprises grow. It deeply engages in global capital markets and corporate consulting services, providing enterprises with comprehensive investment and financing as well as various other professional consulting services.
The Frost & Sullivan Summit integrates professional resources, a pool of high-quality targets, a capital pool, and a pool of growth and innovation experts to deeply empower practitioners of 'new investment'. It helps enterprises achieve growth, empowers industrial transformation and upgrading through innovation and entrepreneurship, cultivates leading Chinese entrepreneurs, and ultimately promotes the economic and social development of China.
The Frost & Sullivan Summit is held in over 20 countries and regions around the world, with a history of nearly 30 years. It has attracted the deep participation of a large number of Fortune Global 1000 companies, top domestic and international financial institutions, and other leading enterprises. It helps them identify opportunities, continuously innovate, accelerate growth, and gain a leading position in an increasingly complex and changing world.
Since its inception in China in 2008, the Frost & Sullivan Summit has been held for the seventeenth time. It has become an important platform for outstanding domestic enterprises, the investment community, and regulatory authorities to exchange successful experiences and jointly explore development directions, as well as an important window for the world to understand China's most cutting-edge development trends.
Meanwhile, Frost & Sullivan is also actively hosting and organizing various conferences in the field of life sciences. For example, it has organized sub-forums for the second session of the Global Health Forum at the Boao Forum for Asia, special sessions for the International Health Industry Forum at the Boao Forum for Asia, the New Investment Summit on Life Sciences, and the Digitalization Summit for the Pharmaceutical Industry. These events provide an important platform for outstanding enterprises in the biotechnology field to exchange successful experiences and discuss development directions.
LeadLeo—— making professionalism even more professional
LeadLeo (English abbreviation: '“LeadLeo”) was officially established in 2018 and is a leading original content platform for industry-research in China, as well as an innovative provider of digital research services.
"LeadLeo" is the abbreviation for "Investment Report". What is an investment report? LeadLeo focuses on research in primary and secondary markets, accurately positions users, and helps them achieve investment and financing goals. LeadLeo's Sci-Tech Innovation Network (www.leadleo.com) has over 150,000 registered users, covers more than 6,000 industry tracks and produces relevant research reports, possesses over 1 million original data elements, and offers over 2,000 live broadcasts and video content. Its users cover more than 70% of investment and financing institutions, financial institutions, and capital market service providers.
In addition, Dr. Wang Xin also explained the four profound meanings contained within the name 'LeadLeo': 'Brainstorming': LeadLeo actively recruits industry experts and practitioners, obtains data through firsthand research, pools collective wisdom and innovative knowledge to provide support for national and industrial development; 'Headline coverage': LeadLeo achieves diversified publishing through traditional media, self-media, and other channels to help enterprises enhance their influence; 'Investment returns': LeadLeo integrates resources to assist investment institutions and investors in finding new and promising tracks, selecting high-quality targets, and improving investment efficiency; 'Repaying kindness with kindness': Frost & Sullivan and LeadLeo actively support college students' employment and 'mass entrepreneurship and innovation', cultivating and delivering a large number of professionals with research literacy to society, contributing professional strength to the sustainable development of industries and the construction of 'Digital China'.
TIM+5R service helps Chinese biotech companies achieve growth
Dr. Wang Xin stated that in the future, Frost & Sullivan and LeadLeo will continue to actively apply the newly proposed 'Total Investment Management (TIM)' concept and model, providing comprehensive investment management services to enterprises including corporate management, regulatory communication, industry trend analysis, market and strategic planning, brand value empowerment, etc. They will fully leverage the 5R (Public Relations (PR), Investor Relations (IR), Government Relations (GR), Analyst Relations (AR), Value Relations (VR)) management advantages to help enterprises position themselves and enhance their value, tell a good story in the capital market, achieve efficient communication with investment institutions, investors, industry affiliates, stakeholders, and other parties involved, jointly assist Chinese biotech companies in achieving growth, and ultimately promote the healthy development of China's economy.
