On December 22, Fosun Pharma (600196.SH; 02196.HK) responded to a regulatory inquiry from the Shanghai Stock Exchange regarding its 1.412 billion yuan investment in Green Valley (Shanghai) Pharmaceuticals. The deal aims to incorporate Green Valley's core Alzheimer's drug, Sodium Oligomannate (branded as "GV-971"), into Fosun's innovative drug pipeline.

The transaction, announced on December 15, sparked investor concerns, triggering a 4.22% drop in Fosun's A-shares and a 5.81% decline in its H-shares the following day. GV-971 had received conditional approval from China's drug regulator in November 2019 for mild-to-moderate Alzheimer's treatment, marking the first new AD drug approval globally since 2002. However, its efficacy has been persistently questioned, including by former Capital Medical University president Rao Yi, who criticized shifting mechanism claims and ultimately unproven "gut microbiome" theory.

In 2024, Green Valley failed to secure approval for extending GV-971's registration certificate after not completing required post-market confirmatory trials. Commercial production halted since November 2024 due to expired certification.

Fosun disclosed a structured payment approach: 143 million yuan for existing equity plus 1.269 billion yuan in phased capital injections for new shares. The first 635 million yuan installment will be paid upon deal closure, with the remainder contingent on R&D progress over three years. Green Valley's founder pledged 10% equity as collateral for potential risks.

Regarding clinical progress, Fosun revised trial protocols per 2025 regulatory guidelines, extending the double-blind period to 48 weeks and expanding sample size to 1,950 cases. As of December 15, 2025, 580 participants had been enrolled. The company projects completing enrollment by late 2027, with final data expected in early 2029 for regulatory submission.

(Note: This article does not constitute investment advice)