Veteran innovative drug company Betta Pharmaceuticals Co.,Ltd. stands at a critical juncture as it announced its third Hong Kong stock offering plan on September 11. Founded in 2003, Betta Pharmaceuticals was among China's earliest innovative drug companies focused on independent R&D. After listing on the ChiNext board in 2016, the company saw revenues surge past 2 billion yuan, driven by its lung cancer drug icotinib (brand name "Conmana").
However, in recent years, the company has faced mounting criticism over its weak pipeline follow-up, declining market share of core products, and underperforming new drug launches. Profits have declined while R&D spending has been continuously reduced.
Betta Pharmaceuticals appears to recognize these challenges. Three days before announcing its Hong Kong IPO plan, the company held a meeting at its Hangzhou headquarters where Chairman Ding Lieming frankly acknowledged that compared to industry leaders, Betta has gaps to close and proposed a five-year "Betta Rebuilding" initiative.
**Third Hong Kong IPO Attempt Driven by Financing Needs**
Founded by a team of overseas Chinese scientists, Betta Pharmaceuticals developed China's first domestically-produced small molecule targeted lung cancer drug icotinib in 2011, breaking the long-standing monopoly of multinational pharmaceutical companies and leaving a significant mark in China's innovative drug history.
In November 2016, Betta Pharmaceuticals listed on the Shenzhen Stock Exchange's ChiNext board, becoming one of the most sought-after pharmaceutical companies by capital that year. On its first trading day, the company's stock price surged, with market capitalization reaching approximately 35 billion yuan.
However, Betta Pharmaceuticals' capital market journey has been rocky since its 2016 highlight. Five years after its ChiNext listing, the company began seeking additional financing channels, turning its attention to the Hong Kong market in 2021.
The first application was submitted in February 2021, passing the hearing in May. At that time, the company's fundamentals were decent: 2020 operating revenue of 1.87 billion yuan and net profit attributable to shareholders of 600 million yuan. However, the offering ultimately failed to complete, likely due to valuation pressure on Hong Kong's pharmaceutical sector in the second half of 2021, as capital markets became cautious toward biomedical companies with insufficient profitability.
The second application occurred in December of the same year. In 2021, the company achieved full-year revenue of 2.25 billion yuan, up approximately 20% year-over-year, but net profit attributable to shareholders was only 380 million yuan, down 36% year-over-year. The sharp decline in financial performance, combined with market headwinds, caused the second application to stall quickly.
From 2022 onward, Hong Kong's pharmaceutical sector entered a valuation downturn, with primary market fundraising slowing and secondary market stock prices continuing to decline. Betta Pharmaceuticals missed the optimal window.
In retrospect, the company's revenue maintained double-digit growth from 2020 to 2021, but sudden changes in the capital market environment rendered both Hong Kong IPO attempts unsuccessful.
On September 11, 2025, Betta Pharmaceuticals announced its third Hong Kong IPO plan. Unlike the previous two attempts, this one is driven by more direct and urgent motives. According to Betta Pharmaceuticals' 2025 interim report, the company achieved operating revenue of 1.731 billion yuan in the first half, up 15.4% year-over-year, but net profit attributable to shareholders was only 140 million yuan, down 37.5% year-over-year.
The company's current assets total only 1.36 billion yuan, while current liabilities reach 1.76 billion yuan, indicating a significant short-term debt gap. Period expenses surged dramatically, with pharmaceutical sales expenses of 326 million yuan in the first half of 2025, up 34.5% year-over-year, while revenue growth was only 15.43%. Management expenses reached 261 million yuan, up 23.5% year-over-year, and financial expenses soared 118% year-over-year, reflecting the company's financial burden under reduced capitalized interest and rising debt pressure.
Overall, Betta Pharmaceuticals presents a typical "revenue growth without profit growth" scenario. Operating activities have failed to generate sufficient cash flow, and the company urgently needs financing.
**Core Product Past Its Peak, New Drugs Struggle to Take Over**
Betta Pharmaceuticals' success is closely tied to icotinib. As China's first independently developed and approved first-generation EGFR-TKI targeted drug, icotinib quickly opened up the domestic non-small cell lung cancer (NSCLC) market after its 2011 launch.
In 2016, during the first batch of national drug price negotiations, icotinib gained insurance coverage by reducing its price by 54%. Starting in 2017, it was included in the national insurance catalog's Category B list, achieving nationwide volume expansion. In 2021, its new adjuvant therapy indication was also included in insurance, further expanding patient coverage.
Driven by insurance inclusion, icotinib's sales climbed steadily, reaching a historical peak of nearly 2 billion yuan around 2021. This peak was closely tied to Betta Pharmaceuticals' financial performance. From 2019-2021, the company's revenue grew from 1.55 billion yuan to 2.25 billion yuan, with net profit exceeding 600 million yuan in 2020, reaching historical highs.
However, Betta Pharmaceuticals has been slow to develop follow-up flagship products. Nine years after icotinib's approval, the company's second commercialized product, another lung cancer drug ensartinib (brand name "Benmana"), was only approved in 2020.
Ensartinib is an ALK mutation inhibitor showing excellent differentiated efficacy in Asian populations. However, its indication is limited: ALK gene mutations account for only 3%-7% of non-small cell lung cancer patients, far below EGFR mutations, which occur in over 40% of Chinese patients. This means that despite the drug's outstanding efficacy, the potential market size remains relatively limited.
Meanwhile, China's lung cancer drug market has undergone tremendous changes. Patients typically experience disease progression after 9-13 months of icotinib use due to drug resistance, and from multiple efficacy dimensions, this "old drug" cannot compete with new-generation lung cancer treatments.
First, AstraZeneca's osimertinib, "the benchmark drug for new-generation lung cancer targeted therapy," entered the Chinese market, followed by rapid emergence of domestic second and third-generation EGFR-TKIs. Hansoh's aumolertinib and Allist's furmonertinib received consecutive approvals and achieved volume sales, gradually overwhelming icotinib.
In this new wave of competition, Betta Pharmaceuticals' highly anticipated third-generation EGFR-TKI befotertinib (brand name "Saimana") appears even more lackluster. Befotertinib received approval for second-line and first-line indications successively in 2023 and entered the national insurance catalog at the end of 2024.
From clinical data, befotertinib shows particularly outstanding efficacy in high-dose groups of patients with brain metastases, with controllable safety profiles. However, as a late entrant, it has struggled to achieve volume sales in the market.
According to Uni-Bio Science announcements and market estimates, befotertinib's full-year 2024 sales were less than 200 million yuan. In comparison, Hansoh's aumolertinib achieved 2024 sales approaching 2 billion yuan, while Allist's furmonertinib exceeded 3 billion yuan.
In terms of pricing, after insurance negotiations, furmonertinib costs approximately 2,494 yuan per box, aumolertinib about 2,016 yuan, while befotertinib costs about 2,800 yuan. Although significantly reduced from the original price, it still lacks price competitiveness among similar products.
With first-mover products already occupying physician preferences and market share, befotertinib's volume expansion has been significantly delayed.
Although the company has had multiple follow-up products enter the market since 2025, such as tartrate taletrectinib (Kangmeina) approved in June for HR+/HER2- advanced breast cancer second-line treatment, and trastuzumab (Anruize) launched in July, formally entering the breast cancer antibody drug field, these products are currently in early promotion stages and have not yet generated significant revenue contributions.
Over the past three years, the company's revenue growth has been only about 20%, while profits have fallen about 50% from peak levels. Correspondingly, R&D investment and personnel scale have significantly contracted.
Financial reports show Betta Pharmaceuticals' R&D expenses plummeted from approximately 700 million yuan in 2022 to 500 million yuan in 2024, down nearly 30% year-over-year, falling back to pre-2020 levels. The decline in R&D personnel numbers is more direct: 13.1% reduction in 2023 compared to 2022, further declining to 327 people in 2024, representing over 40% reduction compared to 2022.
In March 2024, Betta Pharmaceuticals conducted its largest layoffs since listing, with the R&D department becoming a "disaster area." For an innovative drug company built on R&D, the shrinkage of the R&D team and reduced spending inevitably means slower advancement of subsequent product pipelines.
**Debt Controversy: 180 Million Yuan Owed to Partner for Two Years**
The underperforming befotertinib faces additional troubles. In December 2018, Betta Pharmaceuticals signed an agreement with Uni-Bio Science to introduce befotertinib, with exclusive development and commercialization rights for mainland China, Hong Kong, and Taiwan granted to Betta Pharmaceuticals for a total amount of 230 million yuan.
Betta Pharmaceuticals paid an initial payment of 55.3 million yuan in 2019, but subsequent payments tied to clinical progress have been delayed. According to terms, befotertinib's second-line indication approval in May 2023 triggered 80 million yuan, and first-line indication approval in October triggered another 100 million yuan.
Each milestone payment could be made in two installments, theoretically allowing Betta to fulfill obligations in four payments to spread cash pressure. However, from 2023 to mid-2025, none of these four payments were made, with some overdue by two years.
Uni-Bio Science employed various collection methods during this period, including emails, phone calls, on-site visits, and issued formal demand letters at the end of 2024. Betta Pharmaceuticals' explanation was "the company's own capital arrangements."
However, considering its financial data, the reason for the delay is not difficult to understand. At the end of 2023, Betta Pharmaceuticals had 750 million yuan in cash, with 300 million yuan in liabilities due within one year. By the end of 2024, cash decreased to 470 million yuan while current liabilities due within one year rose to 670 million yuan.
In the first half of 2025, although the company's cash recovered to 520 million yuan, current liabilities due within one year continued rising to 730 million yuan. In other words, funds were prioritized for loan repayment and interest payments, with the partner's 180 million yuan being deferred.
Betta Pharmaceuticals' inability to allocate cash over two consecutive years demonstrates substantial payment difficulties.
Interestingly, Uni-Bio Science only proactively disclosed this debt on June 25, 2025, after being questioned by the Shanghai Stock Exchange, confirming accounts receivable and making bad debt provisions in financial reports.
Uni-Bio Science is a STAR Market-listed innovative drug R&D company. In the first half of 2025, Uni-Bio Science's operating cash flow was -107 million yuan, but achieved net inflow of 319 million yuan through financing activities, with period-end cash and equivalents exceeding 500 million yuan, sufficient to cover R&D expenses. The company recently announced plans to temporarily use idle raised funds for cash management.
In 2024, Uni-Bio Science achieved main business revenue of 169 million yuan, with 160 million yuan from licensing cooperation with CSPC. According to an agreement signed in August 2023, CSPC obtained exclusive rights to lung cancer drug KRAS G12C inhibitor D-1553 in mainland China for total consideration not exceeding 550 million yuan.
In November 2024, this drug received formal approval domestically, with CSPC strictly fulfilling its obligations by paying the 160 million yuan milestone payment on time, contrasting with Betta Pharmaceuticals.
Nevertheless, 180 million yuan remains a significant amount for Uni-Bio Science. The reason for not pursuing litigation may be commercial considerations. Betta Pharmaceuticals remains the sole commercialization channel for befotertinib domestically, and the original agreement also stipulated sales milestone payments and sales commissions when befotertinib's annual net sales first exceed specific amounts.
However, this incident has left traces in the capital market. If befotertinib sales had met expectations, the two parties might have presented different scenarios. But befotertinib's mediocre market performance has exposed risks in the licensing cooperation model: innovators' returns are highly dependent on partners' financial conditions and product commercialization success.
More importantly, this long-overdue debt also demonstrates Betta Pharmaceuticals' difficulties in commercialization realization and capital operations. Behind the third Hong Kong IPO attempt lies the reality of Betta Pharmaceuticals' urgent financing needs and the need to restore commercial credibility.
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