A leading caffeine producer on the ChiNext board has expanded into diverse businesses through acquisitions, yet it has reported consecutive annual losses. Can CSPC Innovation Pharmaceutical Co.,Ltd. (300765.SN) achieve its goal of a dual A+H listing with its second attempt in Hong Kong?
CSPC Innovation Pharmaceutical Co.,Ltd. has recently submitted a fresh listing application to the main board of the Hong Kong Stock Exchange, with CITIC Securities acting as its sole sponsor. The company originated in caffeine production and has diversified into biopharmaceuticals, functional ingredients, and health foods through strategic acquisitions. According to data from Frost & Sullivan, the company has maintained its position as the world's largest producer of chemically synthesized caffeine from 2020 to 2025. By revenue, it held a dominant 50.7% market share in China in 2025.
Listed on the ChiNext board in 2019, the company's financial performance over the past three years has been challenging. Revenues for 2023, 2024, and 2025 were RMB2.539 billion, RMB1.981 billion, and RMB2.158 billion, respectively. Profitability has declined significantly, with the company recording net losses for two consecutive years. Net profits for the period were RMB126 million, -RMB304 million, and -RMB634 million, respectively. Its market capitalization has been in a downtrend since August last year, having shrunk by over 50% to date.
The company's second attempt to list in Hong Kong underscores its determination to secure a dual listing status. However, as a leader in the caffeine industry, its A-share valuation appears elevated with a price-to-book (P/B) ratio of 14.4 times. The key question for potential H-share investors is whether they will support the listing if the company's profitability does not improve.
Financial Performance Volatility and Widening Losses
Founded in 2006, CSPC Innovation Pharmaceutical Co.,Ltd. initially focused on the R&D and production of high-quality caffeine. It strategically expanded into health foods in 2016. In 2022, it acquired 100% of CSPC Shengsheng, extending its product portfolio to other functional ingredients. The acquisition of a controlling stake in Jushi Biopharma in 2024 marked its entry into the biopharmaceutical sector. These moves established its two core business segments: functional ingredients & health products, and biopharmaceuticals.
Functionally, functional ingredients and health products constitute the majority of revenue, but growth has stagnated. Revenue from this segment in 2025 was RMB1.857 billion, a 24.2% decrease from 2023, and its share of total revenue fell by 10.4 percentage points to 86.1%. The biopharmaceutical segment, being new, saw revenue release in 2025 post-acquisition, generating RMB257 million, a 192% year-on-year increase, raising its revenue share to 11.9%.
The company employs both direct sales and distributor models, with direct sales being core. In 2025, these models contributed 73.8% and 26.2% of revenue, respectively. Within the distributor network, growth was notable for biopharmaceutical products, with 120 distributors in 2025, an increase of 41 year-on-year. The company's market reach is global, with Mainland China, Europe, North America, and other regions contributing 52.3%, 15.5%, 11.7%, and 20.5% of revenue in 2025, respectively.
Profitability has shown a weakening trend. Gross profit margins for 2023-2025 were 45.6%, 41.8%, and 38.2%, respectively. The core functional ingredients and health products segment saw its margin drop from 45.5% to 34.7%. The biopharmaceutical segment's margin, while volatile, remained at a high level. On the expense side, both selling and administrative expense ratios increased. The most significant rise was in the R&D expense ratio, which is the largest component. In 2025, the combined ratio of these three expenses was 68.2%, with the R&D expense ratio alone at 49.2%, far exceeding the gross profit margin.
Clearly, while acquisition-driven expansion opened new business areas, it did not translate into higher growth levels. Instead, it led to a shift from profitability to losses, which have continued to widen. The company's net profit margins for 2023-2025 were 5%, -15.3%, and -29.4%, respectively.
It is worth noting that as of April 2026, the company held bank balances and cash of RMB718 million with minimal bank borrowings, indicating relatively ample liquidity. However, a point of caution is that a direct controlling shareholder provided RMB1.146 billion in current loans, accounting for 48.6% of current liabilities. If profitability does not improve, this could also become a debt risk.
Unstable Core Business, Biopharma Emerges as Growth Driver
Looking at specific businesses, functional ingredients and health products are the core revenue source for CSPC Innovation Pharmaceutical Co.,Ltd.. Functional ingredients mainly include caffeine products, acarbose, and anhydrous glucose. While caffeine sales volume grew steadily, its average selling price per kilogram continued to decline from RMB93.0 in 2023 to RMB68.3 in 2024 and RMB64.8 in 2025, leading to a downward trend in product revenue. Acarbose sales are minimal with low contribution, and anhydrous glucose sales are highly volatile, though the company is actively expanding into the Asia-Pacific market, including Singapore and South Korea.
The company's health products consist mainly of five best-selling items, including Guoweikang® Vitamin C Chewable Tablets and Fuxinlang® Coenzyme Q10 Soft Capsules. The sales network for these products covers over 270 chain pharmacies nationwide. Sales volume for this series is highly volatile; although it increased significantly in 2025, it remained far below 2023 levels.
Biopharmaceuticals represent the company's most promising business. Its subsidiary, Jushi Biopharma, focuses on antibody drugs, ADCs, and mRNA vaccines, targeting therapeutic areas with significant growth potential, including oncology, autoimmune diseases, and infectious diseases. To date, the company has commercialized three antibody drugs and two mRNA vaccines. It boasts a robust pipeline of over 15 drug candidates in clinical or late-stage development, including nine ADC candidates and one mRNA vaccine candidate.
The company's ADC pipeline strategically focuses on high-incidence indications (such as lung cancer, breast cancer) and cancer types with unmet medical needs (like gastric cancer, colorectal cancer, and ESCC). It has nine ADC candidates in clinical stages targeting various markers. Three ADC candidates have already entered Phase II or III clinical trials. This includes two lead candidates—SYS6010 and SYS6002. SYS6010 has the potential to become China's first approved EGFR ADC drug for treating non-small cell lung cancer.
Additionally, the company's mRNA vaccine candidate in development is SYS6017, designed for preventing herpes zoster infection and currently in Phase II clinical studies. Globally, no mRNA vaccine for VZV infection has been marketed yet.
While the biopharmaceutical segment contributed 11.9% of revenue in 2025, the expected commercialization of several ADC candidates is set to significantly boost its contribution, positioning it as the company's core growth driver.
Future Prospects Amidst Market Cap Risks
From an industry perspective, the caffeine market is relatively small and growing slowly. The global synthetic caffeine market size was USD 515 million in 2025, with a five-year compound annual growth rate (CAGR) of 4.3%, and is projected to reach USD 796 million by 2030. The nutrition and health food market is large but also exhibits limited growth, with a global size of USD 5.248 trillion in 2025 and a five-year CAGR of only 5.76%.
In the pharmaceutical market, the global size was USD 1.6 trillion in 2025 with a five-year CAGR of 3.6%, though structural opportunities exist. Within the global antibody drug market, ADC drugs show high growth potential. The global ADC market was USD 17.5 billion in 2025 with a five-year CAGR of 33.3%, and is expected to reach USD 63.2 billion by 2030, representing a CAGR of 27.6%. The growth rate in the Chinese market is even more impressive at 51.4%.
CSPC Innovation Pharmaceutical Co.,Ltd.'s three product lines face different dynamics. The caffeine industry is highly concentrated; in China, the top three players hold a 90% market share, with the company itself commanding over half. It holds a leading position in caffeine and sells to 73 countries and regions globally, with major markets in North America and Europe. However, the limited industry size and declining price trend constrain its growth narrative. The performance of its health products is highly volatile with unstable competitiveness.
In the biopharmaceutical field, the company's multiple ADC candidates are at advanced clinical stages. For instance, for its EGFR ADC candidate targeting specific indications, its clinical progress leads many peers who are mostly in Phase I/II trials. Therefore, future performance expectations largely hinge on the biopharmaceutical segment, which is the company's key strategic focus.
The company plans to increase investment in related technology areas to build an advanced ADC R&D system and develop a rich pipeline of best-in-class and first-in-class drug candidates. From 2026 to 2028, it expects to submit BLAs for DP303c (a HER2 ADC), SYS6010 (an EGFR ADC), and SYS6002 (a Nectin-4 ADC) to the National Medical Products Administration, and advance several other ADC candidates into pivotal trials.
In summary, while CSPC Innovation Pharmaceutical Co.,Ltd. has diversified through acquisitions, the impact on its performance has been muted. Declining prices for its core caffeine products and unstable sales of health products have contributed to earnings volatility. Significant R&D investment in biopharmaceuticals, post-consolidation, has further pressured profitability. Nonetheless, the biopharmaceutical segment stands out as a growth bright spot, with multiple candidates in late-stage trials poised to become the core driver of future performance upon commercialization. It is important to note that the company's A-share market capitalization exceeds RMB 36 billion, with a relatively high P/B valuation. If clinical progress or commercialization falls short of expectations, there remains a risk of further market cap decline.
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