A RMB 500 million investment made a decade ago by 3SBio (1580.HK) has now yielded nearly a tenfold return. This investment originated from 3SBio’s acquisition of Mindy International (referred to as "Mindy") in 2015. According to Mindy’s post-money valuation in its Series A funding round in November 2025, the company is now worth HKD 5.8 billion, marking a tenfold surge from its acquisition price a decade ago. With further valuation growth potential, 3SBio is currently preparing to spin off Mindy for a Hong Kong IPO.
Mindy specializes in the hair loss market, with its core product being minoxidil tincture, which has surpassed RMB 1 billion in revenue. In 2024, the company reported revenue and net profit of RMB 1.455 billion and RMB 390 million, respectively. Mindy’s strategy heavily relies on marketing to drive sales of minoxidil tincture and other hair loss products—its 2024 marketing expenses were six times its R&D spending.
Despite its substantial revenue, Mindy faces a critical challenge: growth of its flagship minoxidil tincture has slowed, while new products have yet to become significant revenue drivers. The IPO could provide Mindy with additional resources to expand into weight management and dermatology products.
**Aggressive Marketing Push** Mindy’s core focus is minoxidil, a mainstream treatment for hair loss. In China, androgenetic alopecia treatments primarily include minoxidil, finasteride, and spironolactone. Minoxidil stands out as the only therapy approved for both men and women, with relatively manageable side effects. For instance, finasteride, FDA-approved in 1992 and 1997 for treating male benign prostatic hyperplasia and hair loss, works by inhibiting 5α-reductase activity, reducing dihydrotestosterone (DHT) levels. However, it carries side effects like decreased libido and erectile dysfunction (occurring in ~5% of users).
Despite over 30 approved 2% minoxidil products and 40+ 5% minoxidil products in China, Mindy dominates the market, holding a 53.3% share in 2024. Its 5% minoxidil tincture generated RMB 991 million in 2024, accounting for nearly 70% of total revenue.
Mindy’s competitive edge lies in its first-mover advantage and channel strategy. In 2001, it launched China’s first 5% minoxidil tincture, building a 20-year legacy. Additionally, its online sales surged from 55.2% of revenue in 2022 to 72.3% in 2024. Parent company 3SBio plans to expand from traditional e-commerce platforms (e.g., Alibaba, JD.com) to newer ones like Douyin Mall and Xiaohongshu.
Marketing remains a priority: from 2022 to 2024, Mindy’s sales expenses were RMB 476 million, RMB 548 million, and RMB 634 million, respectively—nearly half its revenue. In contrast, 2024 R&D spending was just RMB 92 million, one-sixth of marketing costs. The IPO proceeds will fund digital operations, brand building, online channel expansion, and sales team growth.
Brand loyalty is critical in hair loss treatment, as minoxidil requires long-term use (12 weeks on average to show results, with optimal effects after ~1 year). Early adopters’ habits and trust drive retention.
**Expanding Horizons** Mindy’s marketing-heavy, R&D-light approach aligns with 3SBio’s resource allocation. The parent company prioritizes innovative drugs and CDMO assets, while Mindy serves as a "cash cow." From 2022 to H1 2025, Mindy paid dividends of RMB 250 million, RMB 400 million, and RMB 770 million—124%, 117%, and 443% of net profit, respectively.
Yet challenges loom. Core product minoxidil tincture sales declined by 10% in 2024 and over 25% in H1 2025. Mindy is diversifying into dermatology (e.g., clascoterone cream for acne, D2501 for vitiligo) and weight management (semaglutide injection, with registration planned for 2026). However, semaglutide faces fierce competition in the crowded GLP-1 market.
The most promising growth driver remains hair loss products. In 2024, Mindy launched a 5% minoxidil foam—the only approved domestic foam formulation in China—which generated RMB 283 million in H1 2025, up over 300% YoY. Whether the foam can replace the tincture as Mindy’s revenue pillar will be pivotal.
**A Tenfold Bet** This isn’t 3SBio’s first spin-off. In 2019, it listed Sunshine Guojian Pharmaceutical (688336.SH) on Shanghai’s STAR Market. Mindy could become its third listed entity. Originally acquired for RMB 528 million in 2015, Mindy (then Zhejiang Wansheng Pharmaceutical) was valued for its nephrology and oncology portfolio. 3SBio later pivoted Mindy to hair loss, leveraging e-commerce for minoxidil tincture. By November 2025, Mindy’s valuation hit RMB 5.3 billion (HKD 5.8 billion), a tenfold increase from its acquisition price.
Comments