Chinese diabetes and obesity drugmaker Guangzhou Innogen Pharmaceutical Group Co surged in its trading debut in Hong Kong (HK) on Friday, and is set to score the best first day performance among the 54 firms that started trading in the city this year.
Shares of Innogen, which focuses on diabetes and metabolic diseases, rose as much as 296 percent to HK$74, before trimming increase to around 172 percent as of 11 am in Hong Kong. This compares with its initial public offering (IPO) price of HK$18.68. The company raised nearly HK$683 million ($87 million) in its IPO.
Innogen’s main product, efsubaglutide alfa, belongs to a class of drugs known as GLP-1, which have widely been used around the world to treat diabetes and obesity. So far, the drug is only approved in China for diabetes but it’s in the final stages of testing for weight loss, with data expected around the end of 2026, according to Innogen’s prospectus.
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People have just recently realized the large unmet medical need — and market potential — in chronic metabolic diseases, as lifestyle changes prompt a rise in obesity rates in China, Chief Executive Officer Qinghua Wang said in a Bloomberg TV interview.
Innogen’s diabetes drug has made “significant” progress on the weight loss front, Chief Executive Officer Qinghua Wang said in a Bloomberg TV interview, citing preliminary weight loss data from a mid-stage clinical trial.
Still, the Guangzhou-based firm faces intense competition from both the drug giants Eli Lilly & Co and Novo Nordisk A/S, and a wave of domestic companies developing similar products.
Biotech IPOs have proven popular recently on the Hong Kong stock exchange, with Ab&B Bio-Tech, Nanjing Leads Biolabs and Duality Biotherapeutics all more than doubling on their first trading days. Innogen attracted HK$370 billion ($47.1 billion) of subscriptions for the retail portion of its share sale, per local media, making it more than 5,000 times oversubscribed.
Innogen is looking to expand use of its drug overseas as well, with plans to apply for licenses in Southeast Asia and Latin America, it has said.
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China International Capital Corp and Citic Securities Co are joint sponsors of the offering, while Deutsche Bank AG and Macquarie Capital Ltd are coordinators.
