HKEX finalizes biotech chapter listing rules

Hong Kong Exchanges and Clearing Ltd. (HKEX) released final rules for the listing of pre-revenue biotech companies, companies with weighted voting right (WVR) structures, and Chinese and international companies seeking a secondary listing in Hong Kong. The rules for biotechs -- set to go into effect April 30 -- are substantially the same as those announced in a February consultation paper, but clarify two of the paper’s undefined terms and amend a rule regarding public float requirements (see BioCentury, March 16).

As previously announced, the final rules for the pre-revenue biotech chapter will require companies to have a market cap of at least HK$1.5 billion ($191.2 million) and to have been in their lines of business for at least two financial years with substantially the same management. They must have completed Phase I testing of a drug candidate in humans with no objection from FDA, China FDA or EMA to start Phase II or later testing. After taking IPO proceeds into account, companies will be required to have working capital to cover at least 125% of costs for at least the next 12 months, including general, administrative, operating and R&D costs. ...