The biotechnology sector of the Hong Kong stock market in 2026 is at a subtle and crucial turning point.

According to public disclosures and market statistics, since the beginning of the year, several companies including Yifang Biotechnology, Qinhao Pharmaceutical, and Jiayin Biotechnology have submitted listing applications to the Hong Kong Stock Exchange; In the first half of 2026, 11 18A biotechnology companies completed their IPOs, raising a total of over HKD 10 billion. Most of the new stocks achieved a price increase on their first day of listing.

At the same time, according to public market statistics, as of early July 2026, there are about 50 companies in the Hong Kong stock market's 18A review queue, and the overall number of companies in the medical and health sector has exceeded 100.

Behind the numbers, there is a market that is accelerating differentiation - the narrative logic of "popular targets+celebrity shareholders+forward space" is receding, and regulators and investors are turning their attention to more real and solid cores: clinical data, commercialization paths, technological barriers, and regulatory compliance.

Since the Hong Kong Stock Exchange launched Chapter 18A of the Listing Rules in April 2018, it has been over eight years since it opened the door to the international capital market for non-profit biotechnology companies for the first time. This path has grown from an initial institutional experiment to a mature sector - as of August 2026, 94 companies have been listed and raised approximately HKD 148 billion through IPOs under Rule 18A.

Of course, the market is still changing. The 'Science and Technology Enterprise Special Line' has been implemented. According to the "Consultation Summary" released on July 24th this year and the revised "Listing Rules" ("7.24 New Regulations") that came into effect on the same day, applicants can choose to submit their listing applications in a non-public form, and eligible commercialized biotechnology companies can also choose to go public under Chapter 18A. At the same time, filing with the China Securities Regulatory Commission has become a crucial step in the listing process, and the listing path has received more attention in many domestic entities - rules are changing, thresholds are changing, and market aesthetics are also changing.

As the "institutional dividend period" gradually fades away and the "professional screening period" fully arrives, how can biotechnology companies choose a suitable listing path for themselves? What changes have occurred in the audit logic of 18A? What pitfalls can be avoided in advance in architecture design, data compliance, and commercial review?

Regarding these issues, Xieyi Jun conducted an exclusive interview with William Ji, Co Head of Overseas Capital Markets and Hong Kong Partner at Tianyuan Law Firm, as well as Ms. Eva Chu, Special Advisor. Lawyer Ji Xiaodong has been deeply involved in the Hong Kong stock capital market business for over 20 years, serving multiple innovative pharmaceutical, biotechnology, and healthcare enterprises; Ms. Zhu Yunyi has been engaged in issuance review related work at the Hong Kong Stock Exchange for more than ten years, and is well versed in the underlying requirements of regulatory logic and material quality.

Below, based on their long-term project experience and regulatory observations, they share their judgment on the new cycle of Hong Kong biotechnology listing.

Ji Xiaodong and Zhu Yunyi participated in the CPIC 2026 on-site event
 

01. Intersection of Listed Companies

How to evaluate the role of Hong Kong in the listing and financing of biotechnology companies? Is it still a platform that needs to be taken seriously?

Zhu Yunyi: Hong Kong's advantage lies not only in the IPO itself, but also in its capital market function of connecting China with the world. For biopharmaceutical companies, Hong Kong has both an international investor base and connectivity mechanisms, refinancing tools, and M&A payment tools. After going public, companies can continue to raise funds through methods such as allotment, rights issue, convertible bonds, and can also use Hong Kong stock platforms to promote international cooperation and BD trading.

In the past few years, with the continuous development of the 18A and 18C listing systems, as well as an increasing number of new economy enterprises going public in Hong Kong, the Hong Kong market has gradually formed economies of scale. At the same time, the focus of market attention is also changing, shifting from more emphasis on concepts and tracks in the past to a greater emphasis on the clinical value, commercialization path, and technological barriers of enterprises.

For truly innovative enterprises, Hong Kong remains an international comprehensive platform that combines financing, branding, globalization, and governance enhancement functions.

How should companies choose between the ordinary Chapter 8 listing path set by the Stock Exchange, as well as the special listing paths of Chapters 18A and 18C?

Ji Xiaodong: Path selection should be based on the business attributes, financial performance, and capital market positioning of the enterprise.

Mature enterprises that already have income, profit, or market value/revenue foundations can usually consider the ordinary main board path. Biotechnology companies with clinical and R&D foundations for core products, at least one core product that has passed the conceptual stage but has not yet made a profit or failed to meet the financial qualification test criteria under Rule 8.05 of the Listing Rules, are more suitable for evaluating 18A. According to the new regulation 7.24, commercialized biotechnology companies that meet the financial qualification test under Rule 8.05 may also choose to be listed under Chapter 18A.

If the core value of the enterprise comes from specialized technology fields such as artificial intelligence, robotics and automation, advanced hardware, advanced materials, new energy and environmental protection, new food and agricultural technology, it will pay more attention to 18C.

But the path is not the more special the better, but it depends on the issuer's underlying business performance, disclosure logic, investor awareness, compliance, and whether the issuance arrangements match.

What is the significance of the Science and Technology Enterprise Hotline and Confidential Submission Form for Biotech Enterprises?
Ji Xiaodong: The significance of the Science and Technology Enterprise Special Line lies in appropriately pre empting regulatory communication, allowing potential applicants to have the opportunity to understand the specific requirements of the listing rules, listing eligibility, and individual case concerns before formal submission, and clearing technical barriers for the preparation of application materials and subsequent regulatory approvals.

For biotechnology companies, core pipelines, clinical data, business plans, and listing schedules are all sensitive. Since the new regulations came into effect on July 24th, confidential submission of listing applications has been extended from specific categories such as biotechnology companies and specialized technology companies to all new applicants, which helps to reduce the impact of premature disclosure on the competitive landscape and business negotiations.

But this does not mean that the audit standards will be lowered. On the contrary, the Hong Kong Stock Exchange has strengthened its "posting" system, requiring companies and intermediary teams to provide mature, complete, and verifiable materials when submitting confidential forms. Regulatory convenience provides communication efficiency and confidentiality arrangements, and companies still need to use high-quality application materials to prove that they meet the listing requirements.

02.Water level of 18A

What is the core value of the 18A listing system for Chinese biotech companies?

Zhu Yunyi: The historical significance of 18A is that it allows biotechnology companies that have not yet met traditional profit tests to enter the capital market when their core products, research and development capabilities, and external professional investor endorsements meet certain standards. The new regulation on 7.24 further adds path selection.

But 18A is not a channel for "listing without profit". What regulators and investors are concerned about is whether companies can prove the clinical progress, intellectual property, research and development capabilities, commercialization path, funding allocation, and risk boundaries of their core products.

In other words, what 18A truly connects is research and development value, clinical value, and capital market value. The earlier the enterprise sorts out its pipeline, clinical IP、 The easier it is for financing and compliance issues to form a complete and credible listing story during the submission process.

Freehand: What kind of biopharmaceutical companies are suitable for considering going public in 2018?

Ji Xiaodong: From a regulatory perspective, whether a commercialized biotechnology company that has already met the financial qualification test under Article 8.05 chooses to go public under Chapter 18A mainly depends on the company's business attributes and listing positioning. For enterprises whose core value still mainly comes from the research and commercialization of innovative drugs or other biotechnology products, and who hope to establish a clearer industry disclosure framework around core products, research and development platforms, clinical and regulatory progress in their listing documents, Chapter 18A may be more in line with their business characteristics.

For biotechnology companies that fail to pass the financial qualification test under Article 8.05 and apply for listing under Chapter 18A, in addition to a market value of not less than HKD 1.5 billion at the time of listing, they must also have at least one core product that has passed the conceptual stage, have been engaged in core product research and development for at least 12 months prior to listing, possess relevant patents, patent applications, or other intellectual property rights, and meet the requirements of primarily engaged in research and development, continuity of management and control, sufficient working capital to cover at least 125% of future costs for at least 12 months, and obtain a significant amount of investment from senior investors. The new regulation on July 24 of the Stock Exchange of China also allows that even if there is a change in the controlling shareholder during the relevant period, as long as the applicant can prove that the change has not caused a significant change in the influence of the management, it can still be considered as meeting the requirements for continuity of ownership and control.

But in practice, we will further evaluate the following dimensions:

Firstly, whether the core product has clear and credible clinical evidence and regulatory pathways; Secondly, whether the enterprise has stable intellectual property rights and continuous research and development capabilities; Thirdly, whether the market space, competitive landscape, and commercialization path of the product are clear; Fourthly, whether the valuation, issuance scale, and investor structure can be accepted by the market; Fifth, whether the compliance foundation, application materials, and verification papers of the enterprise are sufficient to support a complete and credible listing disclosure.

What is the current regulatory focus on the "core product" of 18A?

Zhu Yunyi: The core product has always been the center of the 18A audit.

Regulatory agencies typically focus on indication boundaries, patient populations, clinical stages, development timelines, criteria for skipping certain clinical stages, and important communication records with regulatory agencies such as NMPA and FDA.

For license in products, regulators will also pay attention to whether the applicant has undertaken substantive research and development work since its introduction and completed relevant regulated human clinical trials in accordance with regulatory requirements. The license agreement will also be sufficient to support business stability in subsequent research and development, production, and commercialization.

Therefore, companies should not only write their core products as technical stories, but should also present clinical evidence, regulatory pathways, market space, competitive landscape, and commercial arrangements simultaneously, so that investors can understand why the product has the opportunity to be transformed into commercial value.

Why are the rules for senior investors becoming increasingly important? What role does this rule play in the listing of 18A?

Ji Xiaodong: Senior investors are not only sources of funds, but also professional endorsements.

When regulators judge whether an investment has reached a "considerable amount", they will comprehensively consider the investment amount, shareholding ratio, investment timing, and whether the investor has experience, background, and qualifications in the field of biotechnology.

For applicants who fail to pass the financial qualification test under Article 8.05 of the Main Board Listing Rules and are listed under Chapter 18A, the relevant investment usually needs to be made at least six months before the listing, and the investment has not been withdrawn at the time of the initial public offering. Therefore, companies cannot simply search for funds temporarily before submitting the application in order to meet the listing targets. Instead, they should plan the financing pace in advance based on their own situation, introduce investors who truly understand the track, recognize the technical route, and can accompany the company for a long time.

It should be noted that according to the new regulation 7.24, commercialized biotechnology companies that have met the financial qualification test under Article 8.05 and have chosen to be listed under Chapter 18A are no longer subject to the significant investment requirements for senior investors mentioned above. For such companies, senior investors are more likely to demonstrate market recognition and issuance endorsement of the issuer, rather than being a mandatory qualification for choosing Chapter 18A listing.

For the 18A companies that still need to comply with the senior investor regulations, a qualified and convincing portfolio of senior investors not only helps to meet regulatory requirements, but also facilitates subsequent market education and pricing issuance, truly transforming research capabilities into global assets through Hong Kong.

03. Compliance background color

How to choose H-share, red chip, and VIE structure?

Ji Xiaodong: After the implementation of the new regulations for overseas listing filing, the certainty of the H-share path has significantly increased. For most domestic operating entities, the H-share path usually has lower restructuring costs and avoids complex cross-border acquisitions and capital flow arrangements.

The red chip architecture still has room for application, but it is more suitable for enterprises with real commercial rationality, such as the demand for overseas circulation and exit of shareholders, or enterprises with real cross-border operations, overseas financing, or overseas asset arrangements, such as issuers who have introduced US dollar funds, conducted international multi center clinical trials, and have overseas BD cooperation or overseas capital arrangements.

From recent project practices, regulatory agencies are increasingly concerned about the commercial necessity and rationality of companies adopting red chip architecture.

If a company has already established a red chip but the necessity is insufficient, it may need to evaluate the cost of retaining, adjusting, or dismantling it in the future. The dismantling of red chips involves issues related to funding, taxation, foreign exchange, valuation, equity ownership, and timeline. The earlier you plan, the more proactive you will be.

For the VIE architecture, it is necessary to first determine whether there are indeed foreign investment access restrictions in the relevant business. The VIE architecture follows the "Narrowly Tailored" principle (strict limit principle) and should only be adopted within the scope necessary to address relevant foreign shareholding restrictions. At the same time, companies also need to consider filing with the China Securities Regulatory Commission, as well as ongoing compliance and disclosure requirements after listing. For businesses that are subject to foreign investment restrictions or prohibitions, such as the CGT industry, the Notice on Expanding Pilot Work in the Medical Field, issued by the Ministry of Commerce, the National Health Commission, and the State Administration for Market Regulation on September 7, 2024, also breaks through the restrictions on foreign investment in the field of "human stem cells, cell and gene therapy development and application" in the Special Management Measures for Foreign Investment Access (Negative List) within the scope of "conditional (for product registration and production in China) and regional (in Beijing, Shanghai, Guangzhou, and Hainan)".
What impact does filing with the China Securities Regulatory Commission have on biopharmaceutical companies?

Ji Xiaodong: CSRC filing has become a crucial and even decisive step in the Hong Kong listing process. According to the overseas listing filing rules of the China Securities Regulatory Commission, domestic enterprises are required to undergo filing procedures for direct or indirect overseas listings; In the practice of Hong Kong IPO projects, filing must be initiated within three working days after submitting A1, and a filing notice must be obtained before the hearing.

During the filing process, regulatory authorities will focus on aspects such as equity structure, historical development, foreign investment access, licensing, data and network security, and opinions from industry regulatory authorities. If medical and health enterprises involve human stem cells, gene diagnosis and treatment, medical institutions, human genetic resources, clinical data export and other matters, the China Securities Regulatory Commission needs to consult the opinions of the competent departments in advance, and the filing time and uncertainty may increase.

We usually recommend that companies complete the pre sorting of business scope, qualification permits, data compliance, and communication with regulatory authorities before A1, and strive for the support of local regulatory authorities, financial commissions, and securities regulatory bureaus to avoid passive waiting after submitting forms.

Why are data compliance and human genetic resources easy to become difficulties in going public?

Zhu Yunyi: Biotechnology companies often handle patient and subject data, medical imaging, and human genetic resource information in clinical trials.

If a company conducts international multi center clinical trials, collaborates with overseas entities, or provides relevant data or human genetic resource information to overseas entities, it may involve compliance requirements at different levels such as approval, filing, information backup, and security assessment, as well as cross-border data compliance issues, depending on the data type, processing scenario, and transmission path. The characteristics of such issues are strong professionalism, involving multiple subjects and links, requiring a certain amount of time for historical verification and rectification, and not only affecting IPOs, but also overseas clinical, BD transactions, and international cooperation.

Therefore, enterprises should establish a clinical trial data compliance system as soon as possible, and sort out historical cooperation agreements, ethical reviews, data flow, overseas transmission, and human genetic resource approval and filing situations.
Is the regulatory focus different for biotech products that have already been commercialized?

Ji Xiaodong: For enterprises that already have commercialized products, regulatory attention will significantly expand to BD progress and sales and promotion compliance. For example, dealer and CSO arrangements, sales and promotion expenses, return arrangements, two ticket system, medical insurance access and payment policies, medical anti-corruption and commercial bribery risks may all become the focus of inquiries. If the enterprise has license out or joint commercialization arrangements, it also needs to clearly disclose the product, region, down payment, milestone payment, franchise fees, and rights retention.

For enterprises, commercialization is not simply about proving "existing income", but also about proving clear BD paths, compliant revenue sources, sustainable sales systems, genuine and complete promotion expenses, and relevant arrangements that can withstand underlying data verification.

04. Window and Wind Direction

What impact does the optimized return mechanism in the 7.24 new regulations, also known as the "collective posting" mechanism in the market, have on intermediaries and issuers?

Ji Xiaodong: According to the new regulations, once a listing application is returned due to incomplete application versions or related documents, it will not only be the sponsor displayed on the designated website of the exchange, but also professional institutions such as lawyers, accountants, and industry consultants who participate in the application materials. The roles of each party and the reasons for the return of the application will be indicated.

This means that intermediary responsibilities will be further shifted and strengthened. For issuers, choosing an experienced, pragmatic, and collaborative intermediary team will be more important than in the past. Preparation for listing should not only pursue speed and efficiency, but also focus on quality and verifiability.

We understand that in the future, the core of project management will pay more attention to the closure of working papers, consistency of facts, disclosure boundaries, and prediction of regulatory issues. Any weak link may affect the overall pace of the project.

Author: Apart from Chapter 18A, non-public submission and return mechanism, what other important adjustments have been made to different voting rights and the second listing of overseas issuers in the "Consultation Summary" released by the Hong Kong Stock Exchange? What is the relationship between these reforms and biopharmaceutical companies?

Zhu Yunyi: This round of reform has also relaxed the admission arrangements for different voting structures and overseas issuers' secondary listings.

For companies that intend to adopt different voting structures for their main listing, the financial eligibility threshold will be reduced from a market value of not less than HKD 40 billion at the time of listing, or a market value of not less than HKD 10 billion and a revenue of not less than HKD 1 billion in the most recent audited accounting year, to not less than HKD 20 billion, or not less than HKD 6 billion and a revenue of not less than HKD 600 million, respectively.

Applicants with a market value of no less than HKD 40 billion at the time of listing may have their voting rights ratio limit increased from 10:1 to 20:1; If the relevant economic interests of different voting rights beneficiaries account for at least 5% of the issued share capital and the amount is not less than HKD 4 billion, their economic interest proportion may be lower than the usually applicable 10%. This provides greater flexibility for innovative drug and biotechnology companies led by founders and whose equity has been diluted after multiple rounds of financing, but the companies still need to comply or be deemed to comply with the regulations of innovative industry companies, and meet applicable requirements such as business success, external recognition, and corporate governance.

For overseas listed companies, the financial threshold for the second listing of different voting rights issuers will be simultaneously lowered; One of the qualification tests for same stock and same rights issuers has lowered the market value threshold from HKD 10 billion to HKD 6 billion, and continues to require listing on qualified exchanges and maintaining a good compliance record for two years. The qualification test with a market value of no less than HKD 3 billion and a five-year good compliance record remains unchanged.

These adjustments have lowered the entry threshold for some overseas listed biopharmaceutical companies to enter Hong Kong for a second listing. Whether a company adopts different voting structures or secondary listing paths still needs to be comprehensively judged based on its equity structure, market value, listing status, compliance records, and subsequent regulatory costs.

What are the practical impacts of cornerstone, anchoring, and free circulation in the distribution process?

Ji Xiaodong: The hearing is only the threshold for entering the issuance stage, and whether the issuance can be successful depends on the market, orders, and investor structure.

Cornerstone investors usually sign legally binding investment agreements after the hearing and before the IPO, with a six-month lock up period, so their subscribed shares are usually not included in the free float at the time of listing; Anchor investors usually do not have a lock up period and are an important source of customers for free floating stocks.

For small and medium-sized projects, local state-owned assets, industrial capital, and domestic financial institutions often play a greater role. With the implementation of new regulations related to issuance mechanisms, public shareholding, and free circulation, some small market value H-share projects need to plan their issuance scale, cornerstone ratio, anchor orders, and full circulation arrangements earlier. Enterprises cannot and will not wait until after the hearing to start seeking investors, but should prepare investor stories, valuation logic, and issuance support as early as possible under compliance conditions.

How is the current development of the biotechnology listing system? What are the market size and recent trends worth paying attention to?

Zhu Yunyi: Chapter 18A has gradually become an important component of Hong Kong's biotechnology financing system.

As of August 2026, a total of 94 companies have successfully listed under the 18A rule, raising approximately HKD 148 billion through IPOs, and the market size effect is becoming increasingly evident.

In the past year or two, there have been two noteworthy trends: firstly, the Hong Kong Securities and Futures Commission and the Hong Kong Stock Exchange jointly announced the launch of the "Science and Technology Enterprise Line" on May 6, 2025, providing pre listing communication and confidential submission of listing applications for eligible biotechnology companies and specialized technology companies; Secondly, on March 13, 2026, the Hong Kong Stock Exchange issued a new round of consultation on "Enhancing the Competitiveness of the Listing System", proposing to allow biotechnology companies that meet the financial qualification test under Chapter 8 to still choose to list under Chapter 18A. The new regulation on July 24 officially adopted this proposal and came into effect immediately.

Overall, the listing path is becoming more flexible, but the review requirements for core products, clinical and regulatory progress, senior investors, and issuance feasibility have not decreased.

05. Starting line

What preparations should companies make now if they plan to go public in Hong Kong in the next 12 to 24 months?

Ji Xiaodong: The first step is path judgment, clarifying the eligibility path for listing on the regular main board, 18A, 18C, as well as H-shares and whether to retain the red chip or VIE structure path.

The second step is to systematically sort out the core products and compliance drafts, including clinical data, regulatory communication, intellectual property, CRO/CDMO and other R&D and production cooperation, CSO and distribution arrangements, commercialization arrangements, and human genetic resource compliance.

The third step is to deal with equity and financing issues, including the termination of special rights, stock reform, and financing schedule (subject to the "28/120 day" principle).

The fourth step is to identify in advance the foreign investment access, licenses, data, and regulatory opinions that may be of concern to the CSRC filing.

Finally, it is necessary to establish corporate governance, internal control, ESG, and anti bribery systems. Listing does not start from the moment of submission, but from the moment the company decides to connect with the capital market.

From the perspectives of regulatory review and project execution, what are the differentiated advantages of the Tianyuan team?
Ji Xiaodong: The listing of biotechnology companies is not a single legal issue, but a capital market project composed of product, clinical, intellectual property, domestic and foreign supervision, prospectus, investors, and issuance arrangements.

The advantages of the Tianyuan team come from long-term project accumulation in serving innovative drugs, vaccines, gene therapy, innovative medical devices, and medical service enterprises, which enables them to understand the business logic and transaction needs of the enterprise; On the other hand, we have the ability to integrate project execution both domestically and internationally, and can handle Chinese laws, Hong Kong laws, listing disclosures, and regulatory communication between the two regions in a unified manner.

Ms. Zhu Yunyi has long been involved in the issuance review of the Hong Kong Stock Exchange and has academic background, regulatory practical experience, and project experience in biomedicine. She is able to identify issues in advance from the perspectives of review logic and material quality. Our goal is not to simply list the company's information in the prospectus, but to help the company establish a complete listing logic that can withstand regulatory inquiries and investor scrutiny.

- Conclusion -

Overall, the listing of Hong Kong biopharmaceuticals has entered the "professional screening period" from the "institutional dividend period".

18A and 18C still provide important paths for high-quality innovative enterprises. The Science and Technology Enterprise Special Line has improved communication efficiency before listing, and the non-public submission mechanism applicable to all new applicants has further strengthened commercial information protection arrangements. Commercialized biotechnology companies have also obtained more flexible listing path choices. However, both regulators and the market place greater emphasis on genuine innovation, clinical evidence, commercialization pathways, investor recognition, and the quality of application materials.

For enterprises, going public should not be seen as a single financing action, but rather as a systematic capital market project: from products, data, intellectual property, corporate governance, domestic and foreign compliance, to capital operations after issuance and listing, all need to be planned in advance.

For companies planning to go public in Hong Kong in the next one to two years, the earlier they carry out path diagnosis and compliance examinations, the better they can seize the initiative when the window comes.

(This article is for general market observation only and does not constitute specific legal advice; for specific project matters, it is recommended to consult professionals.)

Interviewee Profile
 

William Ji

Lawyer Ji Xiaodong is the joint head of Tianyuan's overseas capital market and the founding partner of William Ji&Co. LLP, the predecessor of Tianyuan Hong Kong. He is a senior lawyer in the UK and Hong Kong, and has been deeply involved in the Hong Kong capital market and the overseas listing of Chinese enterprises for more than 20 years. Lawyer Ji graduated from China University of Political Science and Law and Oxford University in the UK, and has worked at top international law firms such as Freshfields and Shearman&Sterling LLP. Since the establishment of the Hong Kong office by Xiezhuan Tianyuan in 2016, Lawyer Ji has led a team to serve numerous Chinese companies in listing, refinancing, and cross-border transactions in Hong Kong. Particularly, he has accumulated rich experience in the fields of biotechnology and healthcare, with related projects covering multiple sub sectors such as innovative drugs, gene therapy, vaccines, surgical robots, medical devices, oncology, evidence-based medicine, medical information technology, assisted reproduction, medical aesthetics, and health services.
 

Eva Chu

Ms. Zhu Yunyi has served as the Senior Vice President and Audit Supervisor of the Listing Department of the Hong Kong Stock Exchange. She has been engaged in issuance review work since 2005 and has over ten years of experience in listing and issuance review. I have participated in the review of projects such as the main board, ChiNext board, spin off listing, and shell listing, and have led and participated in multiple internal listing policy research and listing rule revision work of the Hong Kong Stock Exchange. Ms. Zhu has multiple backgrounds in medicine, Hong Kong regulation, investment banking, finance, and ESG. She has rich experience and keen insights into Hong Kong stock regulatory trends, audit logic, and application material quality.