Layoffs, delisting, bankruptcy!

The market environment is sluggish, and Biotech has begun to choose "survival with broken arm.

On June 6, Amarin, a Nasdaq-listed company, announced a restructuring plan that would lay off 65% of its.

Worse than layoffs is bankrupt.

Looking at the global market, the East and the West are cold and co.

In 2018, the Hong Kong Stock Exchange added Chapter 18A "Biotechnology Companies" to the main board listing rules, allowing biotechnology companies with no income and no profits to list in Hong Ko.

However, the popularity of China's biomedical innovation track has only lasted for less than 5 years, but there is a scene of prosperi.

In the second half of 2021, the decline in the Hong Kong Stock Exchange, the break of the break, the situation turned sharp.

From cash shortages, to massive layoffs, to bankruptcy and delisting, under the cold capital winter, Biotech around the world is trying to survive the cold wi.

layoffs, delisting

Biotech is shrinking strategically

Biotech in the global market has no time to wait and see, risks are around, and intensive layoffs may be the beginni.

Such large-scale layoffs in a short period of time are enough to show that small and medium-sized Biotech companies are experiencing the most difficult market downturn in recent yea.

The industry generally believes that the reasons why companies are forced to announce layoffs are the unsatisfactory product research and development, the inability to achieve commercialization, the income from the main business is not substantial, and the reserve funds are not enough to bu.

The capital market sentiment is even more pessimistic, and the financing situation of Biotech companies in the first quarter of 2022 has shrunk significantly, hitting the lowest level in recent yea.

Financing of Biotech Enterprises in Western Capital Markets

Industry insiders said that once or twice may be an accident, and a family or two may be a special case, but now the large-scale cold wave has sounded the final alarm for companies to save themselv.

On April 8, 2022, Kaleido Biosciences, an American microbial pharmaceutical company, filed an application announcing its intention to cease operations, lay off remaining employees and delist from the Nasdaq exchan.

Kaleido Biosciences was once a company comparable to the star pharmaceutical company Moder.

At the end of May 2022, Genocea Biosciences announced its delisting and will lay off all remaining employe.

As of March 31, 2022, the once-hot innovative pharmaceutical company had only $21 million in cash and cash equivalents and $6 million in outstanding borrowin.

As of May 24, the company's market value was only $2 million, a 99% evaporation, with a share price of $07 per sha.

Analysts believe that although the fire of biomedical innovation is raging in the sky, up to now, no matter what kind of firewood is lacking in clinical trial expectations, product development pipelines, and commercialization capabilities, the risk of the fire being extinguished is close to infini.

In this cold winter, with clinical termination, cash shortage, mass layoffs, bankruptcy declaration, and preparation for delisting, Kaleido Biosciences and Genocea Biosciences show us the complete process of the decline of Biotech compani.

Their fate may happen to any new drug research and development company at home and abro.

As a result, layoffs, clinical terminations and even bankruptcy liquidation may become the norm for Biote.

Local innovative companies spend the winter

Biotech Innovation Sustainability Exam

The sudden wave of layoffs in the US biotech industry is not a bad thi.

At least it reminds Chinese pharmaceutical start-ups that it is time to change their development strategi.

In the past few years, benefiting from the drug review reform and favorable capital market policies, a large number of start-up Biotechs in China have been able to enter the capital mark.

At that time, the market was extremely enthusiast.

As long as the company could show its development potential, it would be recognized by the mark.

From 2018 to 2021, the number of 18A listed companies increased rapidly from 5 in 1 year to 20 in 1 ye.

Pioneer companies such as BeiGene, Cinda Bio, and Junshi Bio have increased their market value when they listed in Hong Kong, and subscriptions have been hot; by 2020, 14 18A companies such as Kangfang Bio will have an average annual cumulative increase of 3

However, the good times did not last lo.

As more and more innovative companies joined, the market did not reach a new high as expect.

In the second half of 2021, the industry situation will take a sharp turn for the wor.

As of December 31, the Hong Kong-listed Biotechnology Index fell 279%; less than 1/3 of the 18A companies' stocks rose positive.

20 Class B shares were listed throughout the year, 15 of which broke on the first day, and the break rate was as high as 7

For innovative companies that need to continue to "burn money" for development, they cannot do without the help of the capital market and have special demands for financi.

 

However, the earlier frenzied investors seem to have suddenly cooled down, taking an unprecedentedly cautious attitude towards such biotech companies that have no revenue, are difficult to make profits, and have high investment ris.

Compared with the listing boom in the previous two years, in 2021, 17 pharmaceutical companies in the domestic market will succumb to the IPO of the Science and Technology Innovation Boa.

Among them, except for Haihe Bio, Jikai Gene, and Jiachuang Bio, 3 pharmaceutical companies were terminated by the Science and Technology Innovation Board Listing Committ.

After review, the remaining 14 pharmaceutical companies, such as Tasly Bio, Dana Bio, and Lepu Diagnostics, all voluntarily withdraw their IPO applicatio.

The capital market needs hype, and "innovation stories" can naturally encourage investors' confidence when the market is optimistic, and provide a steady stream of funds for corporate R&.

However, when the real cold wave hits, investors no longer believe their expectations, and Biotech companies will obviously face huge innovation pressure due to the lack of short-term hematopoietic capabiliti.

The upward trend of Jiahe Biotech, which is highly praised by Hillhouse, only lasted for 2 days after its listing, and then it turned sharply down, and the decline has not stopped so f.

Perhaps it is precisely because of the unrecoverable capital decline that on April 14, .

Zhou Xinhua, the founder, decided to resign as president and executive director of the gro.

The former star innovative drug company Jiahe Bio has gradually lagged behind the "first echelon" of innovative drugs, and its current market value is only HK$803 billi.

The founder resigns and the stock price plummets, further fueling concerns about the risks of biotech innovation in the pharmaceutical mark.

Obviously, the confidence of the domestic capital market in Biotech is collapsi.

Subsequently, it was rumored in the media that Tianjing Bio was considering selling its business to a US or European pharmaceutical giant that wanted to expand its cancer treatment business in Chi.

Although Tianjing Bio was officially denied, the bad capital market further triggered investors to "vote with their fee.

Wanchun Pharmaceutical's layoffs, Clover Bio's "shrinking pipelin.


The cold winter of this round of Biotech companies is not only a change in the policy level and the macro environment, but also an inevitable test for the company's internal management and innovation investme.

The market generally believes that for some currently high market value Biotech companies, it is lucky to still be able to advance future growth space to obtain cash flow "blood transfusion", while for most Biotech, "waiting for rice to cook" to find revenue is the top priority, whether it is to realize the produ.

Commercialization, or early realization of license-out transfer rights, or reluctance to lay off staff and optimize pipelines, can only go to the end to "remainder is kin.