Quick Take: Biotech Superstar’s Shares Surge 44% on Shanghai Debut
Pharmaceutical firm WuXi AppTec Co. Ltd. — one of the three companies spun off from a drug giant previously listed in New York — saw its shares surge beyond the daily limit on their first day of trading on the Shanghai bourse.
Shares of AppTec jumped to 31.1 yuan ($4.89) on Tuesday, 44% higher than the IPO price of 21.6 yuan, hitting the Shanghai Stock Exchange’s daily increase limit for newly listed shares, thus keeping the price frozen for the day.
AppTec is a major contract research organization that provides support to the pharmaceutical, biotechnology, and medical device industries in the form of research services outsourced on a contract basis. Its clients include Pfizer Inc., Eli Lilly & Co. and Merck & Co.
Its former parent, WuXi PharmaTech, delisted from the New York Stock Exchange in 2015 and spun off three entities with dedicated focuses: WuXi AppTec, Shanghai SynTheAll Pharmaceutical Co. and WuXi Biologics.
WuXi PharmaTech co-founder Li Ge said earlier that the company left the U.S. stock market because investors there cared too much about short-term results, making it difficult to make large strategic investments. It also went through the 2008 financial crisis, which caused its shares to linger around the IPO price of $14 for five years.
The three subsidiaries now have a total estimated market cap of more than 150 billion yuan, about seven times WuXi PharmaTech's valuation when management took the company private with a $3.5 billion buyout.
Market observers think that the share price of AppTec will continue increasing for several days.
Contact reporter Coco Feng (email@example.com)
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