Sichuan Biokin Pharmaceutical is experiencing a significant downturn in its traditional pharmaceutical operations while continuing to invest heavily in innovative drug development. The company is under dual pressure from declining financial performance and falling stock prices.

After a sharp drop from earning 3.7 billion yuan to projecting a loss of 1.1 billion yuan, Sichuan Biokin Pharmaceutical has demonstrated a dramatic reversal in financial results. The company previously achieved rapid profitability and market capitalization growth through a substantial overseas licensing deal, which propelled its controlling shareholder Zhu Yi to become Sichuan's wealthiest individual.

Beneath the surface success lies the continuous contraction of traditional generic drug business alongside massive expenditures on innovative drug research. With the explosive revenue from license-out agreements proving difficult to sustain and self-developed pipelines still in the investment phase, the company faces challenges in balancing short-term financial security with long-term strategic ambitions.

Following the financial rollercoaster, Sichuan Biokin Pharmaceutical's stock price has experienced substantial declines. Against this backdrop, major pre-IPO shareholders have announced new plans to cash out their holdings.

The company's 2025 performance forecast delivered disappointing news to the market. Preliminary calculations indicate expected annual revenue of approximately 2.5 billion yuan, representing a 57.06% year-over-year decrease. The company projects a net loss attributable to shareholders of about 1.1 billion yuan, a 129.67% decline, and a non-GAAP net loss of approximately 1.2 billion yuan, down 133.01%.

This contrasts sharply with the company's 2024 performance, when Sichuan Biokin Pharmaceutical gained prominence by earning 3.708 billion yuan, covering accumulated losses from previous years and elevating Zhu Yi to the position of Sichuan's richest person.

Zhu Yi, born in 1963 in Nanchong, Sichuan, holds a doctorate in business management from Sichuan University. He began his career as a teacher at West China University of Medical Sciences in 1987, conducting research in virology at a microbiology laboratory. In the early 1990s, he entered business, making his first fortune through foreign trade and real estate in Beihai, Guangxi, before returning to the pharmaceutical industry.

Zhu founded Baili Pharmaceutical, the predecessor of Sichuan Biokin Pharmaceutical, in 1996. The company primarily focused on developing chemical generic drugs and traditional Chinese medicines. Sichuan Biokin Pharmaceutical went public on the STAR Market in 2023 with an issue price of 24.7 yuan per share. By September 3, 2025, the stock price had reached 414.02 yuan per share, representing a more than tenfold increase.

Zhu Yi, holding 298 million shares representing 72.22% of total equity, saw his wealth surge accordingly. In 2025, Zhu ranked 403rd on the Hurun Global Rich List with a fortune of 57 billion yuan.

However, within just one year, both revenue and net profit have declined significantly, returning the company to a loss position. What caused such a dramatic reversal?

Analysis of Sichuan Biokin Pharmaceutical's business structure reveals the company is undergoing substantial transformation. Starting with chemical generic drugs and traditional Chinese medicines, the company has developed a comprehensive pharmaceutical system over more than two decades.

By the end of June 2025, the company possessed 208 chemical drug registration approvals, 20 chemical drug active pharmaceutical ingredient approvals, and 30 traditional Chinese medicine approvals. Key products include propofol emulsion injection for anesthesia, structural fat emulsion injection (C6-24) for parenteral nutrition, astragalus granules among traditional Chinese medicines, and guanfacine hydrochloride extended-release tablets for pediatrics.

Data indicates concerning trends in the chemical generic drug and traditional Chinese medicine segments. From 2022 to 2024, revenue from chemical drugs decreased from 535 million yuan to 381 million yuan and further to 322 million yuan, while gross margins declined from 74.92% to 69.46% and then to 52.75%. Traditional Chinese medicine revenue fluctuated between 167 million yuan, 179 million yuan, and 164 million yuan, with gross margins dropping from 41.65% to 37.8% and then to 34.24%.

Traditional business contributions have declined overall with significant gross margin compression. Production and sales data from periodic reports show some products gradually disappearing from statistics, such as Chaihuang Granules and ribavirin granules, which were absent from 2024 reporting tables.

What brought Sichuan Biokin Pharmaceutical into the spotlight in 2024 was not its traditional business but its innovative drug research, despite having no commercialized products yet. While chemical and traditional Chinese medicines contributed 486 million yuan in revenue that year, intellectual property licensing revenue of 5.332 billion yuan stood out as the primary profit driver.

The company maintains research centers in both China and the United States, possessing global innovation capabilities in tumor macromolecular therapy, along with worldwide clinical development and large-scale production capacity. Its vision is to become a comprehensive biopharmaceutical enterprise with global commercialization capabilities by 2028.

At its STAR Market listing, Sichuan Biokin Pharmaceutical reported 16 core innovative biological drugs with global rights, including bispecific antibody candidate SI-B001 undergoing six Phase II clinical trials, with eight other candidates in Phase I studies. By the end of 2025, 17 core innovative drugs were in clinical trials, including six in global clinical studies. The company was conducting over 100 innovative drug clinical trials worldwide, including more than 90 in China and 10 overseas.

The超过 5 billion yuan intellectual property licensing revenue in 2024 originated from innovative drug achievements. In February 2024, the company's wholly-owned subsidiary SystImmune entered into a development and commercialization agreement with Bristol-Myers Squibb for BL-B01D1. In March, the company received an $800 million upfront payment from BMS, with potential total transaction value reaching up to $8.4 billion.

BL-B01D1 represents a potential first-in-class EGFR/HER3 bispecific antibody-drug conjugate targeting both epidermal growth factor receptor and human epidermal growth factor receptor 3. However, this explosive revenue failed to continue in 2025. The company noted smooth progress in its iza-bren collaboration with BMS, achieving global Phase II/III key registration clinical trial milestones and receiving a $250 million milestone payment.

Clearly, 2025 milestone payments were substantially lower than the intellectual property revenue recognized from the BMS upfront payment in 2024. If development proceeds successfully, Sichuan Biokin Pharmaceutical may receive additional future payments.

Furthermore, the company's core product iza-bren has seen new drug applications for two indications accepted by China's Center for Drug Evaluation and included in priority review processes. However, no related licensing revenue was recorded in the 2025 financial statements.

While the BL-B01D1 licensing agreement generated substantial revenue, the company currently relies heavily on this single source. Under dual pressure from traditional business decline and massive innovative pipeline investment, Sichuan Biokin Pharmaceutical's financial self-sufficiency faces serious challenges.

Financial data clearly reflects the company's funding pressures. For the first three quarters of 2025, net cash flow from operating activities was negative 1.892 billion yuan, contrasting sharply with the positive 4.059 billion yuan for full-year 2024.

Additionally, by the end of the third quarter 2025, notes receivable and accounts receivable climbed to 1.867 billion yuan, significantly higher than the 119 million yuan at 2024 year-end. Long-term borrowing reached 2.81 billion yuan, substantially exceeding the 1.189 billion yuan at the end of 2024.

Research and development expenses totaled 1.772 billion yuan for the first three quarters of 2025, exceeding the full-year 2024 expenditure of 1.443 billion yuan as the company accelerated pipeline development. These items have created increased demands on company cash flow.

According to previous company estimates, operating capital requirements for 2025-2027 total 5.22 billion yuan, with planned capital expenditure of 885 million yuan and safety cash reserves of 1.74 billion yuan. Subtracting the 3.027 billion yuan net cash reserve at the end of 2024, the overall funding gap for 2025-2027 reaches 4.819 billion yuan.

With most products still in development and traditional business providing limited financial support, external financing has become necessary. In September last year, the company completed a secondary offering, raising net proceeds of 3.729 billion yuan. The company stated that net proceeds after deducting issuance costs would be entirely allocated to innovative drug research projects.

Concurrently, the company attempted to advance a Hong Kong listing plan, which was suddenly postponed in November 2025. The company stated that the decision to delay the global offering would not affect current operations and that it was carefully evaluating an updated timetable for the global offering and listing.

Additionally, the company has repeatedly used idle raised capital to temporarily supplement working capital for innovative drug research and other business-related production activities.

While the company seeks to address funding gaps, shareholder reductions have directly impacted market confidence. On January 17, 2026, OAP III (HK) Limited, holding 6.91% of shares acquired pre-IPO, announced plans to reduce holdings by up to 1% within three months due to funding needs. This shareholder initially held 8.49% at listing and had previously reduced holdings in 2024.

According to Tonghuashun data, during the fourth quarter of 2025, several major shareholders reduced positions, including China Europe Healthcare Growth Mixed A, China Universal Innovation Healthcare Mixed A, and Yongying Pharmaceutical Innovation Select Mixed Initiation A. During the third quarter, Guangzhou Defu Investment Consulting Partnership and China Europe Healthcare Innovation Stock A also reduced holdings, while China Universal Healthcare Services Flexible Allocation Mixed A and Fullgoal Precision Healthcare Flexible Allocation Mixed A exited the top ten shareholder list in the second quarter.

Amid continuous selling pressure, Sichuan Biokin Pharmaceutical's stock price has declined 31% from its September 2025 peak through February 6, 2026. The market appears to be awaiting the company's next breakthrough to validate its aggressive transformation strategy toward sustainable commercial success.