Good News on Listing | Frost & Sullivan Assists Suzhou Beikang Medical Co., Ltd. to Successfully Go Public in Hong Kong (2170.HK)

Suzhou Beikang Medical Co., Ltd. (hereinafter referred to as 'Beikang Medical') successfully listed on February 8, 2021, with a global issue of 66.67 million shares at an offering price of HK$27.36, raising approximately HK$182 million. Frost & Sullivan (hereinafter referred to as 'Frost & Sullivan') provided exclusive industry advisory services for Beikang Medical's listing, and hereby warmly congratulate it on its successful listing.

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 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.

The Chinese reproductive genetics medical device market is relatively an emerging market and is developing rapidly. The Chinese reproductive genetics medical device market (calculated based on sales revenue from ex-factory prices) has grown from RMB 1.3 billion in 2015 to RMB 3.4 billion in 2019, with a compound annual growth rate of 28.4%. It is expected to reach RMB 112 billion by 2024, with a compound annual growth rate of 26.5% from 2019 to 2024. Within this market, the reproductive genetics reagent industry has maintained a higher growth rate in recent years and is expected to continue at a high growth rate in the foreseeable future. The Chinese reproductive genetics reagent market (calculated based on sales revenue from ex-factory prices) has grown from RMB 700 million in 2015 to RMB 2.8 billion in 2019, with a compound annual growth rate of 41.4%. It is expected to reach RMB 8.9 billion by 2024, with a compound annual growth rate of 26.2% from 2019 to 2024.

The Chinese reproductive genetics reagent market has developed rapidly, with its market size (calculated based on sales revenue from ex-factory prices) increasing from RMB 700 million in 2015 to RMB 28 billion in 2019, a compound annual growth rate of 41.4%. It is expected to reach RMB 89 billion by 2024, with a compound annual growth rate of 26.2% from 2019 to 2024. Among them, the market for preimplantation genetic testing (PGT) reagents is expected to grow faster than the overall market from 2020 to 2024, with a compound annual growth rate of 120.9% during this period.

After thirty years of development, in vitro fertilization (IVF) has evolved into three generations based on applied technology: traditional IVF (first generation), which involves incubating sperm and eggs together in a laboratory to produce embryos; intracytoplasmic sperm injection (ICSI) IVF (second generation), which uses a technique to inject sperm into an egg; and PGT-IVF (third generation), which involves preparing DNA samples of embryos before implantation using reagents, which are then read by sequencing medical devices for genetic disease analysis. PGT is a key step in third-generation IVF. Although IVF has been used in China for decades, early IVF did not involve PGT.

The scale of third-generation in vitro fertilization (IVF) services (calculated based on total patient expenditures, including registration fees, consultation fees, examination fees, medication costs, and PGT service fees) increased from RMB 300 million in 2015 to RMB 25 billion in 2019, with a compound annual growth rate of 70.8%. It is expected to reach RMB 255 billion by 2024, with a compound annual growth rate of 58.6% from 2019 to 2024.

PGT can generally be divided into three types: Preimplantation Genetic Testing for Non-homologous Chromosome Abnormalities (PGT-A), Preimplantation Genetic Testing for Single Gene Diseases (PGT-M), and Preimplantation Genetic Testing for Structural Rearrangements (PGT-SR). PGT-A is usually the first genetic test performed by couples during in vitro fertilization treatment, and it is generally recommended to be conducted before PGT-M and PGT-SR. In line with the continuous increase in the number of PGT cycles and penetration rate in China, the Chinese PGT service market (measured by total patient expenditure on PGT) increased from RMB 100 million in 2015 to RMB 11 billion in 2019, with a compound annual growth rate of 70.7%, and is expected to reach RMB 120 billion by 2024, with a compound annual growth rate of 60.8% from 2019 to 2024.

Driven by the commercial launch of PGT reagents, the market demand for PGT reagents in China is expected to grow rapidly in the coming years. The market size (calculated based on sales revenue at ex-factory prices) will increase from RMB 9.59 billion in 2020 to RMB 34 billion in 2025, with a compound annual growth rate of 103.8%. It is also expected to further increase to RMB 147 billion by 2030, with a compound annual growth rate of 34.2% from 2025 to 2030.

Frost & Sullivan, integrating nearly 60 years of global consulting experience, has been serving the booming Chinese market with dedication for 23 years. With a global perspective, we help clients accelerate their business growth and achieve industry-leading benchmarks in terms of 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 advice, strategic consulting, management consulting, and other services to hundreds of outstanding domestic and international biopharmaceuticals, medical devices, healthcare services, and internet healthcare companies. Successful listings include: Jianbimiao Miao (2161.HK), Xintong Medical (2160.HK), Rui Li Medical Beauty (2135.HK), Jiake S Pharmaceutical (1167.HK), Hepalink (2142.HK), JD Health (6618.HK), Deqi Pharmaceutical (6996.HK), Rongchang Biotech (9995.HK), WuXi AppTec (2126.HK), Simcere (2096.HK), Yunding Newray (1952.HK), Zai Ding Pharmaceutical (9688.HK), Ocumivir (1477.HK), Yongtai Biotech (6978.HK), Hapre Biotech (9989.HK), Kaisun Pharma (9939.HK), Peijia Medical (9996.HK), Kangfang Biotech (9926.HK), Nuo Cheng Jianhua (9969.HK), Tianjing Biotech (IMAB.NASDAQ), Kanglong Chemical (3759.HK), China Antibody (3681.HK), Dongyao Pharmaceutical (1875.HK), Yasheng Pharmaceutical (6855.HK), Fuhong Hanlin (2696.HK), Hansoh Pharmaceutical (3692.HK), Mabtech Pharma (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), Valneera Biotech (2552.HK), BeiGene (6160.HK), Gilead Sciences (1672.HK), WuXi AppTec (2269.HK), China Resources Pharmaceutical (3320.HK), Yager Scientific (2633.HK), HCM 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 healthcare IPOs, continuously occupying more than 90% of the market share from 2018 to 2020.

Since the listing of the first batch of companies on the Sci-tech Innovation Board in July 2019, Frost & Sullivan reports have been widely cited in the prospectuses of leading Sci-tech Innovation Board-listed companies in the industry, including: Huaxi Biotech (688363.SH), Junshi Biosciences (688180.SH), Zhejiang Genomics & Therapeutics Co., Ltd. (688266.SH), BeiGene (688177.SH), and Shenzhen Celltech Biologics Co., Ltd. (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 big health industry, and build a healthy future.