The Signals Released By Gan Li'S Approval And Biological Valley Pass: The Audit Of Finished Drug IPO Is Gradual.

IPO caliber for pharmaceutical companies seems to have changed.

In June 21st, the results of the eighth Review Conference of the stock transfer system listing committee, including the Yunnan Bio Valley pharmaceutical Limited by Share Ltd (hereinafter referred to as Bio Valley), the two selected layer declaration enterprises were approved.

It is worth mentioning that biological Valley has been asked about sales costs and whether academic promotion fees involve commercial bribery in the information link, and the market once thought that the audit of the compliance of pharmaceutical companies' sales expenses would still impede the listing process of finished pharmaceutical enterprises represented by Bio Valley.

However, the biological Valley finally realized the conditional meeting, and still exceeded the expectations of some investment bankers. On the contrary, the Gan Li pharmaceutical company, which had been unable to get the approval for more than 2 years, has also won the first prize.

The emergence of all kinds of signs is making many IPO makers of the finished products industry see the dawn of hope to resolve the above listing obstacles, which will further facilitate the listing and financing of finished pharmaceutical enterprises and capital operation.

Gan Li pharmaceutical, which has not received approval for more than 2 years, has received the first approval. IPO caliber for pharmaceutical companies seems to have changed. Vision China

Biological Valley risk

In the biological Valley inquiry stage, many people in the industry are not optimistic about the promotion of biological Valley IPO project.

"At that time, when I saw the problems raised by the listing committee, I once squeezed sweat for the selection of biological Valley, because many of the pharmaceutical companies' IPO actually ran aground due to the problem of selling expenses." An investment bank close to the biological Valley pointed out, "the question of the sales cost of biological Valley is still being asked, and the question is very detailed."

According to the enquiry letter from the former stock transfer system, the sales cost of Bio Valley is too high. The prospectus shows that the sales cost of Bio Valley from 2017 to 2019 is as high as 323 million yuan, 277 million yuan and 280 million yuan respectively, accounting for over 50%, and the main purpose is marketing promotion fee.

In the enquiry, the stock transfer system requires the Bio Valley to specify the sales policy, the number of salesmen, the salary and the sales promotion mode. At the same time, it is required that the Bio Valley explain the main contents of the conference fee in detail, including the details of the venue, meeting time, content, agenda, location, cost structure, and remuneration of the lecturer.

"This disclosure requirement is too thin, the industry's NPC knows how these academic promotion fees are going on, so many problems are not particularly good answers." A pharmaceutical product industry said.

In response to the above questions, BIU Valley made a comparison by comparing the similar industries in the same industry, and pointed out that the proportion of the market expenses in the sales expenses from 2017 to 2019 was 86.34%, 88.02% and 90.03% respectively, while the average industry figures calculated by the five pharmaceutical companies, including dragon, wo Hua, bu Chang, Ling Ling and Kunming, were 75.09%, 83.22% and 83.11% respectively. The conclusion is that there is no significant difference.

On the question of whether the market promotion mode is suspected of commercial bribery, Biovalley has achieved a certain degree of "cutting" through the way of external organizations undertaking market promotion. In 2019, the cost of marketing through external agencies amounted to 133 million yuan, accounting for 52.96%. However, the specific information on the contents, agenda, location, number of people, the composition of the cost, and the remuneration of lecturers were not disclosed.

Nevertheless, the biogenic valley was held in June 21st.

At the same time, the listing committee also put forward some suggestions for its implementation. For example, it put forward the need to analyze risks and Countermeasures in combination with patents, R & D investment, procurement and other factors. It further demonstrated the fairness of the previous plant leasing and equity trading, and asked the sponsor to verify the bank's running water, the cancellation of the cost, and the cancellation of the unit during the reporting period. Information. But the details of its "academic promotion fees" have not been further asked.

"In fact, it is" gun raising one foot ", according to the previous caliber, the selling cost of pharmaceutical companies is still relatively sensitive. An investment bank engaged in the IPO business of the pharmaceutical industry admitted.

Final approval of Gan Li

In the story of the progress of IPO in pharmaceutical companies, Bio Valley is not the only protagonist.

By contrast, Gan Li pharmaceutical, which had already passed in April 2018, has been suffering for more than 2 years.

In June 4th, that is, after the in-depth report of the newspaper has already passed the phenomenon of dystocia of the enterprise approval document (two days after the June 2nd IPO approval of the "dystocia"), the SFC issued the approval of Gan Li pharmaceutical company.

In June 22nd, Gan Li pharmaceutical announced that it had completed the issuance of IPO. At the price of 63.32 yuan, it issued a total of 40 million 200 thousand shares, totaling up to 2 billion 545 million yuan.

In fact, the reason why Gan Li pharmaceutical had not been able to land for a long time was also related to the abnormality of the expense subjects.

For example, the prospectus disclosed last 2014 showed that the cost of meetings between 2014 and 2016 and the first half of 2017 were 144 million yuan, 140 million yuan, 181 million yuan and 142 million yuan respectively, which amounted to 607 million yuan, of which 48.39% of the proportion of sales expenses in the first half of 2017 accounted for 48.39% of sales expenses.

"Meeting fees are largely a difficulty of auditing and can easily become a subject of sales return fees. However, in recent years, the number of anti corruption cases against pharmaceutical companies is increasing. On the other hand, under the background of strict audit by IPO, it is difficult for the auditing department to effectively grasp the compliance of these sales costs, so some disputes have been shelved. An investment bank official close to regulators said.

However, the final meeting and successful release of Gan Li pharmaceutical industry may further stimulate the impulse of many similar companies.

"Before, because of the cost problem, the progress of the listing of finished drug companies has not been very smooth. However, the passing of biological Valley and the issuance of Gan Li indicate that similar obstacles may be being solved." The investment bank said.

Good pharmaceutical company IPO?

In fact, many listed pharmaceutical listed companies also have some problems related to the hidden rules of the industry.

For example, Heng Rui medicine, which has a market value of up to 400 billion yuan, has recently been exposed by a ruling document. Its wholly owned subsidiary, Jiangsu new morning Pharmaceutical Co., Ltd. has been involved in the bribery case of Lei Mou, the former anesthesiology director of Lishui Central Hospital in Zhejiang.

"Lian Heng Rui can not avoid such a leading thing, so this phenomenon is still very common in the industry." The medical profession admitted.

"The problem is mainly the industry's hidden rules. Basically, doctors who have entered the hospital seldom have not received any calls from the pharmaco." A doctor in a third class hospital in Beijing admitted. "This may be related to the characteristics of the industry, mainly due to the relatively high degree of homogenization of drugs with limited technical content, while most hospitals are state-owned, and there is a tragedy of the Commons at the procurement side, so it is difficult to avoid similar phenomena."

"The raw materials and intermediates may be fine, but the finished products often have the problem of selling back fees. If the sales cost is too high, the final results will often be asked in the feedback. In recent years, the finished drug companies are listed on the market very little, which is basically related to the regulatory authorities' attention to this problem." Those who are close to the regulatory investment bank point out, "but if the attention of this piece can be weakened, it will further benefit the pharmaceutical enterprises, especially the IPO of the finished pharmaceutical enterprises."

"The problem in the pharmaceutical industry is also a problem of the industry at a special stage and" drug dependent medicine "system to a certain extent. However, it is not conducive to the development of this industry to implement the IPO across the board of finished pharmaceutical enterprises. Those who are engaged in the IPO business of the pharmaceutical industry say that "a reasonable view of the cost of sales may be beneficial to the capital operation and listing financing of pharmaceutical enterprises".

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