Advertisement
How Hong Kong can cement its position as a biotech listing hub
- To maintain its growth and quality, Hong Kong’s biotech sector needs more bankers, analysts and lawyers with international expertise
- Given the short history of the sector and the technical nature of biotech finance skills, the pool of home-grown talent is small, though growing
Reading Time:3 minutes
Why you can trust SCMP
2
In just three years, Hong Kong has grown into the world’s second-largest listing venue for biotechnology pioneers, attracting Chinese and international companies, international investors, and a broad ecosystem of supporting services and participants.
In 2018, Hong Kong Exchanges and Clearing Limited introduced three new listing chapters to attract innovative companies with weighted voting rights structures, pre-revenue biotech companies, and secondary listings. Chapter 18A, which enabled pre-revenue biotech companies to list, has arguably had the most impact on the DNA of the Hong Kong market.
Chapter 18A has so far attracted 32 companies, raising HK$84 billion and, in the past three years, the sector has seen a compound annual growth rate of 61 per cent in its total market capitalisation. Issuers are increasingly diverse, including biotechnology, pharmaceuticals, medical devices, medical services and digital health.
A supporting ecosystem, including university programmes, government funding and biotech finance professionals, has grown, and developed unique Hong Kong characteristics. Hong Kong is now home to over 250 biotech businesses and the government has designated biotech as one of the city’s key areas of innovation and technology.
Investors, from private and public equity funds to sovereign wealth and hedge funds, have joined the market, along with large cornerstone investors and specialist funds, who bring health care expertise to the market. Covid-19 has also raised the profile of the biotech sector, helping retail investors become more familiar with the industry as they back the companies they think can shape the global health agenda.
Advertisement