BeiGene's dilemma: the chief R&D has been replaced twice in three years; the book loss is 2.7 billion

When to make a profit remains a challenge for BeiGene, a company that was abandoned by investors to buy more than a million shares when it first went public. Since amy C. Peterson, the former chief medical officer of immuno-oncology in BeiGene, left in 2019, the person in charge of the position has been replaced twice in three years.

In addition, due to continuous losses, BeiGene's stock price continued to decline after landing on the Science and Technology Innovation Board, and fell below the initial price on the first day of listing. Based on the closing price of 114.73 yuan per share in BeiGene on February 11, 2022, the institutions participating in the company's initial strategic placement had a book loss of about 2.725 billion yuan.

The core R&D chief has been replaced twice every three years

On February 12, 2022, BeiGene issued the "Announcement on the Adjustment of the Positions of the Company's Core Technical Personnel", saying that the company's core technical personnel Yong Ben (贲勇) had applied to the company in August 2021 to leave the company, and he would no longer serve as the company's chief medical officer of immuno-oncology from February 9, 2022, local time in the United States.

BeiGene said that Ben Yong will continue to serve as a special adviser to the company's global research and development leaders to help achieve a smooth transition to the initial work of the new Chief Medical Officer of Immuno-Oncology, and the company is expected to no longer identify Ben Yong as a core technical personnel until June 30, 2022. "Ben Yong's job adjustment will not have a substantial adverse impact on the company's R&D activities and production and operation, and will not affect the core technology owned by the company."

According to the BeiGene prospectus, Yong holds a Ph.D., U.S. citizenship, more than 20 years of experience in oncology, worked as a surgical oncologist at Peking Union Medical College Hospital from 1995 to 2000, served as Pfizer Global Medical Monitor from 2006 to 2012, and was responsible for Axitinib's approval in the field of kidney cancer.

According to the data, Ben Yong joined BeiGene in February 2019 as the chief medical officer of immuno-oncology, mainly responsible for the global clinical research and development of the Baekje solid tumor project. It is worth noting that due to the provisions of the relevant laws of the State of California, there is no non-compete obligation after The Departure of Ben Yong. As of the time of the reshuffle, Ben Yong directly held 2171 ordinary shares issued by BeiGene Shenzhou overseas, as well as the agreed restricted share units and options under the Company's equity incentive plan.

After the adjustment of Ben Yong's position, mark C. Lanasa served as the chief medical officer of the company's immuno-oncology since February 9, 2022 local time in the United States. Prior to joining BeiGene, Dr. Mark C. Lanasa held the position of Vice President and Global Clinical Lead for Oncology Post-Development at AstraZeneca.

According to the BeiGene prospectus, the company has 11 self-developed drugs into clinical trials or commercialization stages, of which 3 drugs have been approved for listing, namely Baiyueze (Zebutinib capsules) is the first China-independently developed anti-cancer drug approved by the US FDA and the first to obtain breakthrough therapy recognition; the cooperation between Bai Zean (tirelizumab injection) and Novartis is the highest down payment amount of Chinese drug authorization transactions so far; And Parkway Ze (Pamipali capsules) It is the first polyadenosine biphosphate ribose polymerase (PARP) inhibitor approved in China for the treatment of patients with recurrent ovarian cancer (OC) covering platinum-sensitive and platinum-resistant BRCA mutations.

Ben Yong is mainly responsible for the clinical development of two approved and commercialized drugs, Bai Zean and Bai Hui Ze, and most of the important indications of these drugs have been approved or are in the clinical development stage. Therefore, Ben Yong has a great impact on the commercial clinical development of BeiGene's core products.

Dating back to 2019, BeiGene's previous chief medical officer for immuno-oncology, Amy C. Peterson, left in 2019. In just three years, the chief R&D has been replaced twice.

The stock price continued to be depressed, with a book loss of 2.7 billion

From the end of 2019 to the end of 2021, the number of R&D personnel in BeiGene was 1470, 2076 and 2949 respectively, accounting for 43.8%, 40.3% and 36.7% of the total number of employees, respectively. From 2019 to the first half of 2021, BeiGene's operating income was 2.954 billion yuan, 2.12 billion yuan and 4.891 billion yuan, and the proportion of R&D investment in operating income was 223.03%, 421.78% and 84.88% respectively.

When to make a profit is still a difficult problem facing BeiGene. From 2019 to the first half of 2021, beiGene's net profit loss attributable to owners of the parent company after deducting non-recurring gains and losses was 7.119 billion yuan, 11.739 billion yuan and 2.507 billion yuan, respectively. As of June 30, 2021, the company's cumulative undistributed profit was -30.076 billion yuan. Continued losses have kept BeiGene's stock price falling.

BeiGene landed on the Star Market on December 15, 2021, with its initial offering price of $192.6 per share. On the first day of listing, BeiGene broke down, and the highest intraday price was 176.96 yuan per share. Subsequently, the company's stock price continued to decline, and on February 11, 2022, BeiGene closed at 114.73 yuan per share, compared with the highest price on the first day of listing, the company's market value evaporated by about 82.89 billion yuan.

According to BeiGene's Announcement on the Results of the Initial Public Offering of Shares and Listing on the Science and Technology Innovation Board, the company's initial strategic placement of 0.35 billion shares involved 15 investment institutions, and the minimum restriction period for strategic placement shares was 12 months. The closing price of 114.73 yuan per share in BeiGene on February 11, 2022 is still 77.87 yuan per share from the company's initial offering price of 192.6 yuan per share. Based on this calculation, the above-mentioned institutions participating in the strategic placement of BeiGene's initial public offering had a book loss of about 2.725 billion yuan.

Tidy up | Qiao Weijun

Typography | Qiao Weijun

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