When the Hong Kong prospectus of Changchun High-Tech Industry (Group) Co., Ltd. appeared on the Hong Kong Stock Exchange's disclosure website, the market did not respond as positively as anticipated. This listing document, which carries the vision of “accelerating globalization strategy,” symbolizes a desperate self-rescue attempt by the well-established biopharmaceutical company following a significant performance decline and a market capitalization shrinkage exceeding 160 billion yuan. The halo accumulated over nearly thirty years in the A-shares market is gradually being overshadowed by the fading benefits of growth hormone, leaving the success of its Hong Kong listing uncertain.
Looking back at Changchun High-Tech's rise, the growth hormone products from its subsidiary, Jinsai Pharmaceutical, have undoubtedly been the main driver. Since breaking foreign monopolies with the launch of the first injectable human growth hormone in 1998, and introducing the world’s first long-acting growth hormone, Jinsai增, in 2014, Jinsai contributed over 80% of the company’s revenue at its peak, supporting Changchun High-Tech's market valuation of over 220 billion yuan. However, over-reliance on a single product revealed its pitfalls, which burst forth when the market dynamics for growth hormones shifted.
The year 2024 marked a turning point for Changchun High-Tech, as the company experienced its first dual decline in revenue and net profit in nearly two decades. Operating revenue fell to 13.466 billion yuan, down 7.55% year-on-year, while net profit dropped sharply by 43.01% to 2.583 billion yuan. This downward trend not only persisted into the first half of 2025 but also worsened. Although revenue reached 6.602 billion yuan, a slight decrease of 0.54%, the net profit plummeted 42.85% year-on-year to 982 million yuan, with the second quarter caught in a contradiction of “increased revenue but decreased profits,” witnessing a 48.83% decline in net profit alongside a marginal 4.16% rise in revenue. The drastic deterioration in profitability is starkly evident in the net profit margin, which fell from 32.79% in 2023 to just 14.11% in the first half of 2025, almost halving and exposing vulnerabilities in the company's profit structure.
The collapse in profits is attributable to the complete stall of the growth hormone “engine.” On the one hand, the decline in birth rates over several years has directly weakened the potential demand from the core patient demographic of ages 4-15 for growth hormones, leading to an irreversible slowdown in patient consultations. On the other hand, the implementation of procurement policies across various provinces has tightened price controls. From the inclusion of growth hormones in procurement in Guangdong Alliance, Fujian, and Hebei in 2022, to Jinsai Pharmaceutical's product winning bids in Zhejiang's 2023 procurement, the previously high-margin model is no longer sustainable. More critically, the monopolistic position of long-acting growth hormones has been compromised, with competing products approved in May 2025, prompting firms like Weisheng Pharmaceuticals and Novo Nordisk to enter the market, thereby eroding Changchun High-Tech's once formidable “moat.”
Alongside these pressures on its core business, Changchun High-Tech's anticipated “second growth curve” has also faced setbacks. Its subsidiary, Baike Biological, reported revenue of 285 million yuan in the first half of 2025, a staggering drop of 53.93%, and recorded a net loss of 74 million yuan. The company’s flagship product, the shingles vaccine, performed poorly, with 2024 revenues plunging 71.54% to just 251 million yuan, rendering the expected boost in performance entirely ineffective.
In addition to business difficulties, the expense control issues at Changchun High-Tech are particularly striking. The 2025 mid-year report indicated total expenses for sales, management, and finance reached 3.101 billion yuan, equating to a staggering 46.97% of its revenue, up 28.5% year-on-year, significantly surpassing the industry average of 35%, exposing the inefficiencies in operational performance. Notably, sales expenses ballooned to 2.386 billion yuan, a 23.43% increase compared to the previous year, directly correlated with the increase in sales personnel from 3,155 to 4,995 within a year—a growth of 1,840 people. This surge in staff has not translated into better performance; instead, it further squeezed profit margins.
The rise in management expenses has also drawn scrutiny, with a year-on-year increase of 25.59% in 2024. The company explained this increase was due to “management restructuring and the establishment of new subsidiaries at Jinsai Pharmaceutical,” yet during a time of plummeting performance, massive management team expansions inevitably raise market concerns regarding its cost control capabilities. Additionally, R&D expenditure rose to 1.155 billion yuan in the first half of 2025, up 30.22% year-on-year, but the company fully recognized a 133 million yuan impairment on capitalized development expenses, partly due to the termination of its long-acting growth hormone project in the U.S. While R&D investments have increased, they have not translated into tangible pipeline progress, with project terminations and asset impairments indicating that R&D efficiency needs significant improvement.
Faced with these multifaceted challenges, Changchun High-Tech has proposed transitioning from a “single-driven self-research model” to a “dual-driven model of self-research and business development,” attempting to overcome obstacles through internationalization and product diversification. In September 2025, Jinsai Pharmaceutical partnered with Denmark’s ALK-Abelló A/S company to develop desensitization treatment products, while sales from foreign markets reached 99 million yuan in 2024, marking a staggering growth of 454% year-on-year. However, these initiatives remain feeble, with overseas revenue bases too low and collaborative projects yet to generate actual performance contributing to the narrative of a “global strategy.”
With the upcoming Hong Kong listing, Changchun High-Tech plans to utilize funds raised for innovation pipelines, global collaboration, sales marketing, and operating capital. Nonetheless, the sentiment towards the biopharmaceutical sector in Hong Kong is currently cautious, with a high rate of new stock breakdowns. If the issue price falls below that of A-shares, it may face “AH discount” pressures. More critically, the patience of the capital markets is wearing thin—having seen market capitalization shrink over 160 billion yuan since its peak in 2021, investors are actively voting with their feet.
For Changchun High-Tech, while a Hong Kong listing may alleviate short-term funding pressures, it will not resolve the fundamental business challenges. In the wake of the growth hormone benefit’s decline, the key to breaking through lies in how to construct a diversified product matrix, enhance operational efficiency, and achieve substantial breakthroughs in overseas markets. If the company cannot rapidly present practical performance improvement plans, this “self-rescue” effort in going public in Hong Kong might only serve as a stopgap measure rather than a turning point to reverse its downward trend.