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Julie Zhang

Hong Kong’s biotech fundraising momentum is expected to extend into 2026, as licensing deals and strong post-initial public offering (IPO) trading last year persuaded investors that China’s drug developers are worth backing again – even before they generate revenue.
“Chinese innovation drugs expanding into overseas markets have become the industry mainstream, indicating the domestic innovation sector has entered its harvest phase,” said Felix Huang, head of equity at Oakwise Capital. “New trends in drug targets and novel therapies have also made biopharmaceutical stocks attractive.”
Pharmaceuticals was one of the best-performing sectors for Hong Kong IPOs in 2025, he added.
Still, analysts warned that the same forces drawing capital back to the sector also underscored its underlying risks.
“Biotech remains a high-risk, cash-hungry sector,” said Edward Au, Deloitte China’s southern region managing partner. “With US interest rates expected to fall and borrowing costs set to decline, the field is likely to draw more investors.”
More candidates are lining up. In the IPO pipeline awaiting approval is CSPC Innovation Pharmaceutical, described as the world’s largest caffeine producer, which has commercialised two antibody drugs and two mRNA vaccines and built a pipeline of 15 drug candidates in clinical or later stages of development, including nine antibody-drug conjugate candidates and one mRNA vaccine candidate.
Under Chapter 18A, Jingze Biopharmaceutical, targeting assisted reproductive and ophthalmic drugs, and InventisBio, which focused on oncology, autoimmune diseases and metabolic disorders, filed for Hong Kong IPOs. Six-year-old Frontera Therapeutics applied to list as a clinical-stage gene therapy company.
Introduced in 2018, the Chapter 18A listing regime aims to attract high-potential issuers that lack the revenue and profit track record normally required for a Hong Kong listing.
Guangzhou Novaken Pharm, another 18A applicant, is developing drugs across therapeutic areas including preoperative sedation, diabetes, weight management and central nervous system disorders.
“Healthcare companies are doing well in secondary markets, mainly thanks to drug out-licensing deals, and some IPOs were very successful – that is why many more healthcare companies are eyeing fundraising in Hong Kong,” said Zhang Jialin, Nomura’s head of China healthcare research. “This wave may continue into 2026.”
Zhang cautioned, however, that too many IPOs in the near term could “cannibalise market liquidity”.
Healthcare firms now account for about a fifth of the more than 300 listing applications in the city, according to Deloitte data, making the industry the second largest contributor to the pipeline after the technology, media and telecommunications sector.

Policy support from Beijing had added to the tailwinds, analysts said. Authorities highlighted biomanufacturing as a growth engine and unveiled the first commercial insurance list of 19 innovative drugs eligible for private health insurance reimbursement, most of them cancer therapies.
Hong Kong-based asset manager Oakwise Capital said its investment in biomedicine companies had “increased significantly” compared with previous years.
A wave of licensing tie-ups between mainland firms and global pharmaceutical giants had helped validate Chinese drug innovation and pushed investor confidence to multi-year highs, analysts said. This had reopened a funding window that had largely been shut after the sector’s earlier hype cycle.
As of December 19, 13 biotech companies had raised a combined HK$50 billion (US$6.43 billion) under Chapter 18A in 2025, compared with four such firms in 2024.
The sector’s rally has added to the appeal. The Hang Seng Innovative Drug Index, which tracks 40 Hong Kong-listed companies engaged in innovative drug research and manufacturing, has surged about 70 per cent over the past year.
Some newly listed names have posted sharp gains. Chinese biotech firm Xuanzhu Biopharmaceutical has more than doubled from its IPO price since its October 15 debut, while shares of Guangzhou Innogen Pharmaceutical Group have more than tripled since its August 15 listing.
The rebound has also spilled into follow-on fundraising. Post-IPO capital raisings by Hong Kong-listed healthcare companies reached about HK$35 billion in the third quarter, up from around HK$1 billion in the second quarter, according to data compiled by Deutsche Bank.
In early December, Chinese drug maker 3SBio raised HK$3.12 billion through a new share placement, using buoyant sentiment in the city’s stock market to fund clinical research in China and the US. Other major follow-on offerings included Akeso’s HK$3.52 billion debut in August and Innovent Biologics’ HK$4.31 billion share sale in July.
Innovent’s cancer drug ivonescimab has been dubbed by Western media a “DeepSeek moment” for China’s drug industry, a label that has further amplified the sense among investors that Chinese drug makers are beginning to produce globally competitive assets.
The timing has also suited issuers such as Insilico Medicine, the AI-driven drug discovery company founded by Alex Zhavoronkov, which raised HK$2.28 billion in its Hong Kong listing on December 30.
“Chinese companies just got out of the biology winter,” said Zhavoronkov just days before his company’s debut. “There was a huge hype cycle, and now it is over and the market has returned to a stable footing.”


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A wave of China out-licensing deals is feeding a biotech comeback in Hong Kong, where IPOs and follow-on placements are surging


A wave of China out-licensing deals is feeding a biotech comeback in Hong Kong, where IPOs and follow-on placements are surging.


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The ‘biology winter’ thaws: why investors are piling into Hong Kong’s biotech IPOs

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}A wave of China out-licensing deals is feeding a biotech comeback in Hong Kong, where IPOs and follow-on placements are surging

A wave of China out-licensing deals is feeding a biotech comeback in Hong Kong, where IPOs and follow-on placements are surging