Shenzhen Salubris Pharmaceuticals Co. Ltd (002294.SZ) has refiled its application for a Hong Kong Stock Exchange listing, aiming to access international capital and partnerships as it transitions from generics to innovative therapies.

The cardiovascular drug maker filed the application in early September with Goldman Sachs, Citigroup, and CITIC Securities as joint sponsors. The move follows 17 years on the mainland stock market and aligns with peers like Fosun Pharma and Hengrui Pharma seeking dual listings amid domestic price pressures.

Financial Performance

Salubris reported steady revenue growth, driven by its shift toward higher-margin innovative drugs. In the first half of FY26, revenue grew 16.3% to 2.48 billion yuan ($371 million), while net profit reached approximately 390 million yuan.

Over the three-year period from 2023 to 2025, revenue compounded at an annual growth rate of about 13.7%. Operating cash flows remained robust, with annual net cash inflows from operating activities ranging between 839 million yuan and 1.19 billion yuan.

What the Numbers Show

The company’s revenue mix is undergoing a structural shift that supports margin expansion despite volume pressures in generics. While generic sales declined from 48.8% to 30% of total pharmaceutical sales between 2023 and 2025, innovative drug contributions rose from 30.1% to 52.1% over the same period. This mix shift coincided with gross profit margins expanding from 68.3% to 74.6%. However, selling and distribution expenses surged to 1.76 billion yuan last year, equivalent to more than 40% of revenue, reflecting the high cost of launching new products.

Patent Expiry Risks

Salubris’ flagship hypertension drug, XinLiTan, generated 1.48 billion yuan in sales in 2025, accounting for nearly 40% of total pharmaceuticals revenue. However, the patent covering its active ingredient expired in July 2026. Although formulation patents remain valid until 2028, the compound patent expiry allows competitors to develop generics using the same active ingredient. Salubris acknowledges in its filing that market share could slip as lower-priced generics enter the market.

To mitigate this risk, the company has accelerated launches of new CKM (cardiovascular, kidney, metabolic) drugs. From 2024 to 2025, approvals included FuLiTan, XinLiTing, XinChaoTuo, and FuLiAn. XinChaoTuo is noted as China’s first home-produced novel drug in the ARNi hypertension category. The pipeline now includes 79 innovative drugs across small molecules, antibodies, siRNA, cyclic peptides, and gene editing.

Strategic Outlook

Unlike many unprofitable biotechs, Salubris maintains ample cash flow, having distributed more than 7.8 billion yuan in dividends since its 2009 Shenzhen listing—more than twice the amount raised from the market. The Hong Kong listing is positioned to facilitate overseas clinical trials and international collaborations rather than immediate capital needs.

In 2025, Salubris ranked second in China’s in-hospital cardiovascular drug market with an 11.3% share. The company continues to face pressure from volume-based procurement policies, which have reduced the retail price of its core generic product TaiJia from 14.5 yuan to 6.99 yuan per pack in the first half of 2026.