Beihai Kangcheng Pharmaceutical Co., Ltd. (hereinafter referred to as 'Beihai Kangcheng') was successfully listed on December 10, 2021. The global number of shares issued was 56,251,000 shares, with each share priced at HK$12.18, raising approximately HK$68,514 million.
During the Hong Kong listing process, Frost & Sullivan mainly undertook the following tasks: helping the company accurately and objectively understand its positioning in the target market, using objective market data to discover, support, and highlight the company's competitive advantages, assisting the company, investment banks, and other intermediaries in completing relevant parts of the prospectus (such as the overview, competitive advantages and strategy, industry overview, business, and other important sections), facilitating communication with the Hong Kong Stock Exchange and investors, helping investors quickly understand the market ecosystem and competitive landscape, and assisting the company in completing feedback on various industry-related issues from the Hong Kong Stock Exchange, etc.
Overview of the Rare Disease Market in China
China is considered one of the markets with the largest population of rare disease patients in the world. The first batch of 121 recognized rare diseases has already affected over 3 million patients. The rare disease drug market is developing rapidly, driven by a large but untapped patient population, the urgent need to improve patient awareness and the development of targeted therapies, government policy encouragement, efficient business models with considerable returns on investment, technological innovation, and the emergence of gene therapy.
Overview of the Rare Disease Drug Market in China
The rare disease market is a branch of the biopharmaceutical market, focusing on the discovery, development, and commercialization of treatments for diseases that affect a minority population, rather than drugs for other common diseases in the general population. Approximately 80% of rare diseases are hereditary, and three-quarters of cases begin during childhood, with a mortality rate of 30% before the age of five. The rare disease market in China started relatively late, but it is expected to grow rapidly in the future, increasing from $1.3 billion in 2020 to $25.9 billion by 2030, with a compound annual growth rate of 34.5%. The rare disease drug market in China accounted for 0.4% and 1.0% of the global market in 2016 and 2020 respectively. With China's continuous reforms to introduce more innovative drugs into the market and improve drug accessibility, it is expected to account for 6.8% of the global rare disease market by 2030, indicating an ideal outlook for the Chinese rare disease market.
Overview of the Global Rare Disease Drug Market
The rare disease drug industry has significant market potential and considerable returns. In 2020, the top ten best-selling orphan drugs generated a total global revenue of $428 billion, including four for treating tumors and six for rare diseases that require long-term treatment.
Top 10 Orphan Drugs by Revenue in 2020
Source: Frost & Sullivan report
China Rare Disease Drug Market Details, 2016 to 2030 (Forecast)
*Note: Rare disease drugs in this market include those for rare diseases only and those that were initially designated as orphan drugs but later had their indications expanded. Most of the revenue comes from these drugs, such as Humira. However, some revenue generated by expanded indications from non-orphan drugs is not included in this market.
Overview of the Chinese Glioblastoma Multiforme (GBM) Market
GBM accounts for 46.6% of the total incidence of brain cancer in China, and the number reached 54,000 cases in 2020. The compound annual growth rate from 2016 to 2020 was 2.0%. Considering factors such as an aging population, ionizing radiation, and air pollution in China, the number of new GBM cases is expected to steadily increase to 60,000 cases by 2025 and to 64,000 cases by 2030, with compound annual growth rates of 1.8% and 1.5%, respectively. It is estimated that the number of GBM patients receiving first-line and second-line treatment in China in 2020 will be about 51,000 and 36,000 cases, respectively. Due to the complex diagnostic process and lack of effective diagnostic methods, the diagnostic rate of GBM in China remains low.
Number of new cases of glioblastoma multiforme (GBM) in China
2016 to 2030 (forecast)
Source: Frost & Sullivan report
Market Overview of Mucopolysaccharidosis Type II (MPS II) in China
Mucopolysaccharidosis type II (MPS II), also known as Hunter syndrome, is a congenital genetic disorder caused by insufficient or absent activity of iduronidase (IDS), an X-linked lysosomal storage disease. IDS is an enzyme that cleaves human glycosaminoglycans (GAGs) into O-linked sulfate parts (i.e., dermatan sulfate and heparan sulfate). After suffering from MPS II, these GAGs accumulate in almost all human organs and tissues, including the brain, heart, lungs, bones, muscles, intestines, and skin. The accumulation of GAGs leads to cellular congestion, organ enlargement, tissue destruction, and dysfunction of the organ system.
Hunterase®It is the only approved therapeutic drug in China. In 2020, there were an estimated more than 8,000 patients nationwide, far from meeting the treatment needs. Therefore, the Chinese government has included MPS II in the 'National Rare Diseases Catalogue' as a target disease category. Since MPS II is a hereditary rare disease with limited treatment options, the market is relatively stable. The number of patients with MPS II in Greater China reached 8,005 in 2020 and is expected to reach 8,175 by 2030.
Number of new cases of mucopolysaccharidosis type II in China
2016 to 2030 (forecast)
Source: Frost & Sullivan report
Other lysosomal storage diseases (LSD) in China
Overview of Rare Cholestatic Diseases
LSD belongs to a group of more than 70 diseases characterized by lysosomal dysfunction, most of which are autosomal recessive genetic disorders, including Gaucher disease (GD), Fabry disease (FD), and Pompe disease (PD). LSD typically occurs in infancy and childhood, but adults can also develop the condition. Although clinical trials for potential treatment methods for several of these diseases are underway, there are currently no approved treatment methods for various types of LSD. Among them, Gaucher disease (GD), also known as glucosylceroidosis, is a familial glycolipid metabolism disorder that is autosomal recessive and is one of the most common lysosomal storage diseases. GD is a clinically heterogeneous disease that includes neurological and non-neurological lesions. The best care may require palliative and supportive treatment. Currently, there are mainly two treatment options for GD: enzyme replacement therapy (ERT) and substrate reduction therapy (SRT). ERT is the most recognized form of GD treatment, with clear treatment goals (changing the size of the liver and spleen, improving blood parameters, relieving bone pain and bone crises). ERT specifically supplements the enzymes lacking in patients' bodies and reduces the accumulation of glucosylceroids in the body, showing good safety performance. In SRT, small molecule drugs are used to partially inhibit the biosynthesis of compounds and accumulate in the absence of specific lysosomal enzymes. These drugs reduce the number of molecules that need to be catabolized within lysosomes, thereby helping to balance the synthesis rate and the impaired catabolism rate.
Biliary cholestasis is a group of diseases caused by major defects in bile flow within the liver or from the liver to the intestines, leading to similar symptoms. Bile stasis may be due to dysfunction of liver or bile duct cells, resulting in reduced bile secretion, inhibited bile secretion, or obstructed bile excretion, causing bile to flow into the lymphatic system and bloodstream instead of entering the small intestine. Biliary cholestasis diseases such as Alagille syndrome (ALGS) and progressive familial intrahepatic cholestasis (PFIC) are rare diseases with a clear genetic basis, while biliary atresia (BA) is considered to be caused by a variety of factors, including genetic risk factors related to immune dysfunction and environmental influences (such as viruses or toxins, each playing different roles). Since these diseases are genetic disorders, the expected steady increase in the global number of patients is mainly due to overall population growth over the next decade. Mirum received FDA approval in September 2021 for maralixibat, a targeted drug used for the treatment of ALGS, making it the first and only targeted drug approved globally for the treatment of ALGS. Currently, there are no approved products for the treatment of PFIC or BA in China or globally.
Frost & Sullivan, integrating 60 years of global consulting experience, has dedicated 23 years to serving the booming Chinese market. With a global perspective, we help clients accelerate their business growth and achieve benchmark positions in industry growth, innovation, and leadership. The healthcare industry is one of the core areas of focus for Frost & Sullivan. Over the past sixteen years, the Frost & Sullivan healthcare team has provided financing and financial advisory services, IPO industry advisory services, strategic consulting, management consulting, and other services to hundreds of outstanding domestic and international biopharmaceutical, medical device, healthcare service, and internet healthcare companies. Successful listings include: Eagle Eye Technology (2251.HK), Clover Biotech (2197.HK), MicroPort Robotics (2252.HK), Huarong Pharma (2256.HK), Kunbo Medical (2216.HK), Xianruida (6669.HK), Kangsheng Global (9960.HK), Yimaitong (2192.HK), Tengsheng Bopharm (2137.HK), CanSinoBiosciences (2162.HK), Chaoyu Eye Hospital (2219.HK), Guichuang Tongqiao (2190.HK), Hua Huang Medicine (0013.HK), Koi Pharmaceuticals (2171.HK), Zhaokex Bio (6622.HK), Nature Pharmacy (UPC.NASDAQ), Sino Biologics (6600.HK), Zhaoyan New Drugs (6127.HK), Novogene Health (6606.HK), Tianyan Pharmaceuticals (ADAG.NASDAQ), Beikang Medical (2170.HK), Jianbimiao Miao (2161.HK), MicroPort Heart (2160.HK), RuiLi Medical Beauty (2135.HK), Gaoke Pharmaceutical (1167.HK), Hepcon Pharma (2142.HK), JD Health (6618.HK), Deqi Pharma (6996.HK), Rongchang Biotech (9995.HK), WuXi AppTec (2126.HK), Sino Biologics (2096.HK), Tencent Healthcare (1952.HK), Jiahe Biotech (6998.HK), Zai Ding Pharma (9688.HK), Ocular Biotech (1477.HK), Yongtai Biotech (6978.HK), Hapre Biotech (9989.HK), Pioneering Pharma (9939.HK), Peijia Medical (9996.HK), Kangfang Biotech (9926.HK), Nuo Cheng Jian Hua (9969.HK), IMAB.NASDAQ, Kanglong Chemical (3759.HK), China Antibody (3681.HK), Dongyao Pharmaceutical (1875.HK), Yasheng Medicine (6855.HK), Fuhong Hanlin (2696.HK), Hansoh Pharmaceutical (3692.HK), Mabotech (2181.HK), Fangda Holdings (1521.HK), Via Biotech (1873.HK), CStone Pharmaceuticals (2616.HK), Junshi Biosciences (1877.HK), WuXi AppTec (2359.HK), Innovent Biologics (1801.HK), Hailun Medicine (2552.HK), BeiGene (6160.HK), Gilead Sciences (1672.HK), WuXi AppTec (2269.HK), China Resources Pharmaceutical (3320.HK), Jacobus Pharmaceutica (2633.HK), Hua Huang China Medicine (HCM.NASDAQ), Biotechnology (1548.HK), BBI Life Sciences (1035.HK), etc. In terms of the number of listed projects, the Frost & Sullivan healthcare team maintains an absolute leading position in Hong Kong's healthcare IPO market, continuously occupying more than 90% of the market share from 2018 to 2020.
Since the first batch of companies on the Sci-tech Innovation Board (STAR Market) were listed in July 2019, Frost & Sullivan reports have also been widely cited in the prospectuses of leading STAR Market-listed companies in the industry, including: Novogene (688105.SH), Chengda Biology (688739.SH), Geke Microelectronics (688728.SH), Huaxi Biotechnology (688363.SH), Junshi Biosciences (688180.SH), Zhejiang Genomics & Biotechnology Co., Ltd. (688266.SH), Beiogen (688177.SH), and Shenzhou Cells (688520.SH). They are considered the most powerful, professional, and influential industry research institutions in the sector. We hope to work with enterprises to understand industry trends, seize development opportunities, jointly promote innovation and upgrading of China's healthcare industry, and build a healthy future.
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