The domestic inhaled formulation market has long been monopolized by multinational pharmaceutical companies, but CF PHARMTECH has successfully cracked open this market after eighteen years of effort.

On October 8, CF PHARMTECH Limited (Stock Code: 02652.HK) officially commenced trading on the Hong Kong Stock Exchange's Main Board. The IPO joint sponsors were CITIC Securities and CMB International, with an offering price of HK$14.75 per share. CF PHARMTECH opened at HK$48 per share on October 8, surging 225.42% with a market capitalization approaching HK$20 billion, becoming a standout star in the recent Hong Kong IPO market. On October 9, CF PHARMTECH opened slightly higher before declining, closing at HK$34.44 per share at midday.

According to information published by the Hong Kong Stock Exchange, CF PHARMTECH's Hong Kong public offering portion received nearly 6,700 times oversubscription, ranking among the top figures in this year's Hong Kong IPO market.

Behind the surging market enthusiasm lies investor optimism about CF PHARMTECH's sector. Financial reports show that CF PHARMTECH achieved full-year revenue of RMB 608 million in 2024, with a compound annual growth rate of 31.9% from 2022 to 2024. Additionally, CF PHARMTECH turned profitable in 2023, with net profit shifting from negative RMB 49.399 million in 2022 to positive RMB 31.726 million in 2023.

According to the prospectus, CF PHARMTECH's net proceeds from this listing amount to approximately HK$525 million. The company will allocate funds as follows: approximately 40% for R&D and clinical development of domestic and international inhaled formulation candidate products; approximately 20% for supporting preclinical research of other pipelines and technologies; approximately 30% for expansion and upgrading of production facilities, equipment procurement, and management systems; approximately 10% for working capital and other general corporate purposes.

A pharmaceutical industry analyst stated that CF PHARMTECH's successful landing on the Hong Kong Stock Exchange's Main Board and the explosive subscription performance essentially reflect the market's high recognition of its core competitiveness. In fact, as of early October, over 60 companies have listed on the Hong Kong Stock Exchange this year, but the overall market shows characteristics of "concentration at the top, coldness at the bottom." On one hand, quality companies remain sought after, with "pricing mechanism optimization" releasing positive signals. On the other hand, traditional industries or companies with volatile performance face coldness, with the "listing break wave" forcing value return.

"The Hong Kong IPO market in 2025 is transitioning from 'scale expansion' to 'quality screening.' Currently, quality companies obtain higher pricing power through mechanism optimization, while projects with weak fundamentals face stricter scrutiny," the analyst said.

**Potential and Pressure**

For a long time, the global respiratory system inhaled formulation drug market has had high concentration, with dominant products concentrated in large multinational pharmaceutical companies such as AstraZeneca and GlaxoSmithKline. By generic name breakdown, the top five varieties in China's respiratory disease inhalant market are budesonide, budesonide formoterol, salmeterol fluticasone, terbutaline, and tiotropium bromide, with a combined market share of 69.6%. Among these, budesonide inhalation suspension is the largest-selling inhaled formulation variety domestically.

At the end of 2021, CF PHARMTECH, whose main product is budesonide inhalation suspension, chose to withdraw its materials after its first attempt at the STAR Market. Public information at the time indicated that CF PHARMTECH would comprehensively evaluate its situation before reselecting a listing venue. After lying dormant for a year, CF PHARMTECH again submitted its STAR Market listing prospectus in June 2024.

The Shanghai Stock Exchange website shows that CF PHARMTECH underwent inquiry on July 5, 2023, but needed to supplement submissions because the financial data recorded in the listing application documents had exceeded their validity period. With the STAR Market's increasingly strict admission requirements, this may add further uncertainty to CF PHARMTECH's "landing." This has made CF PHARMTECH's Hong Kong listing particularly noteworthy in the market.

The prospectus shows that the company currently has nearly 40 R&D pipelines, with 4 products approved by China's National Medical Products Administration and 1 product (arformoterol nebulizer solution GW006) approved by the US FDA. The company's core product CF017 (budesonide inhalation suspension) was quickly included in national volume-based procurement after approval in 2021, successfully breaking foreign enterprise monopoly.

Prospectus data shows that by sales volume in 2024, CF017 accounts for approximately 16% of China's budesonide inhalation drug market. Another product, CF018 (azelastine fluticasone nasal spray), as China's first hormone-antihistamine compound nasal spray, filled a clinical gap. After being included in the medical insurance catalog in December 2023, this product rapidly gained volume, with first-quarter 2025 sales (RMB 10.34 million) reaching 43.3% of full-year 2024 sales. Additionally, the company's R&D team brings together domestic and international respiratory field experts, with R&D investment maintaining over 20% of revenue for the past three years, providing momentum for continuous pipeline iteration.

The aforementioned analyst pointed out that the company currently has multiple generic drugs that have passed consistency evaluation and entered volume-based procurement, contributing stable cash flow. Meanwhile, innovative drug pipeline cooperation with multinational pharmaceutical companies (such as overseas rights licensing) is expected to open international incremental markets. From industry patterns, respiratory formulations, once approved, typically achieve faster commercialization volume expansion than highly competitive fields like oncology due to patient long-term medication adherence. Combined with this fundraising to supplement working capital, the company is expected to enter a profit release period in the next 2-3 years.

Despite strong market performance, CF PHARMTECH still faces significant operational risks. Most notably is the company's over-dependence on the single product CF017. The prospectus shows that in 2022, 2023, 2024, and the first quarter of 2025, CF017 sales revenue accounted for 96.2%, 98.4%, 94.5%, and 91.6% of total revenue, respectively.

Meanwhile, CF017's growth momentum is showing signs of fatigue. From 2022 to 2024, the product's sales volume increased from 121 million units to 209 million units, but growth rates declined significantly from 63.97% to 5.66%. During the same period, sales revenue increased from RMB 336 million to RMB 574 million, with growth rates declining from 63.05% to 4.88%. In the first quarter of 2025, CF017's sales revenue and volume declined by 8.95% and 1.95% year-over-year, respectively.

Additionally, CF PHARMTECH faces intense market competition. Currently, 9 budesonide suspension-related products are marketed in China, with 7 being domestic products, including Chia Tai Tianqing's "Tianqing Suchang" and Joincare's "Wushu."

According to the prospectus, in 2024, CF PHARMTECH ranked fourth in China's budesonide suspension market, with sales revenue and volume market shares of 10.1% and 15.7%, respectively. Furthermore, CF PHARMTECH has attracted market attention due to high "hospital visit fees." In its previous STAR Market prospectus, "hospital visit" expenses were RMB 3.1167 million and RMB 23.8576 million in 2021 and 2022, respectively, while "market information analysis and collection" expenses were RMB 528,500 and RMB 49.909 million, respectively, with both categories showing significant increases.

Thus, it's evident that concerns lurk behind CF PHARMTECH's 6,698-fold oversubscription.

**Hot Hong Kong IPO Market**

CF PHARMTECH's listing coincides with a wave of enthusiasm in the Hong Kong IPO market.

Wind data shows that in the first three quarters of this year, the Hong Kong Stock Exchange completed 68 initial public offering (IPO) projects, an increase of 23 from 45 in the same period last year, representing a 51.11% increase. Total fundraising reached HK$182.396 billion, a significant 228% increase from HK$55.753 billion in the same period last year, far exceeding the full-year 2024 amount of HK$88.147 billion.

Additionally, just on September 29 and September 30, 29 companies including Changchun High & New Technology, BeiGene, and Henlius submitted applications to the Hong Kong Stock Exchange. According to Hong Kong Stock Exchange disclosure announcements, as of September 30, 2025, a total of 277 companies (including Main Board and GEM) were in the IPO queue. The Hong Kong Stock Exchange's "2024 Listing Committee Report" shows that only 80 listing applications were reviewed throughout last year.

Clearly, biotechnology companies have become important participants in this round of Hong Kong IPO enthusiasm. Recently listed innovative pharmaceutical companies such as Veritas Pharma and Innocare Pharma received over 3,000-fold oversubscriptions, with share prices doubling on listing day, reversing the previous situation of innovative pharmaceutical companies facing "immediate listing breaks" in Hong Kong stocks.

The aforementioned analyst pointed out that the landscape of companies listing in Hong Kong since 2025 can be described as "ice and fire" under intensifying differentiation. On one hand, the Hong Kong Stock Exchange revised new stock pricing mechanisms in August 2025 (including shortening the pricing-to-listing time interval and strengthening cornerstone investor constraints), aimed at improving pricing efficiency and market transparency. Under new regulations, quality projects have enhanced pricing capabilities, and the market no longer blindly "subscribes to new issues" but is more willing to pay for certainty. On the other hand, some companies have experienced insufficient subscriptions or immediate listing breaks due to obvious industry ceilings (such as traditional manufacturing), unclear profit models (such as some consumer projects), or market environment sensitivity (such as periodic pressure on Hong Kong stock liquidity). This indicates that the Hong Kong stock market's tolerance for "storytelling" has decreased, focusing more on corporate fundamental solidity and long-term growth potential.

This has made Hong Kong stock investors extremely sensitive to companies' profitability, cash flow stability, and industry competitive landscape. Companies need to ensure their core businesses have clear profit logic, with R&D investment matching commercialization progress, avoiding "only burning money without output" skepticism. For example, CF PHARMTECH's strategy of using generic drug cash flow to support innovative drug R&D while maintaining pipeline progress that meets market expectations makes this "long-short combination" strategy more convincing.

"Companies need to grasp the 'rhythm' of policy and market windows," the analyst believes. The Hong Kong Stock Exchange's 2025 new regulations optimized pricing and trading mechanisms, requiring companies to work closely with investment banks to dynamically adjust issuance scale and pricing ranges based on market sentiment. Moreover, companies need to continuously convey value after listing, avoiding "one-shot deals." Hong Kong stock liquidity differentiation is significant - quality companies attract continued capital attention through regular performance disclosures and strategic upgrades, while companies lacking follow-up actions are easily marginalized. CF PHARMTECH needs to focus on core product approval progress, commercialization volume data, and overseas expansion progress, using actual performance to meet market expectations to maintain valuation premiums.

Facing the dual challenges of market competition and single-product dependence, CF PHARMTECH is accelerating its diversification layout. The company's nearly 40 R&D pipelines and gradually advancing internationalization provide more possibilities for future development. However, from the setback at the STAR Market to successful listing on the Hong Kong Stock Exchange, CF PHARMTECH's capital journey itself demonstrates that innovative pharmaceutical companies need more patience and wisdom.

For investors, CF PHARMTECH's value lies not only in its first-day stock performance but also in whether it can, with capital support, truly grow into a platform-type leading enterprise in the respiratory disease field based in China and facing the world - this still requires time and market validation.