Sichuan Kelun-Biotech's Strategic Momentum and Capital Strength: A Catalyst for Long-Term Value Creation

In the rapidly evolving biopharmaceutical landscape, companies that combine robust clinical innovation with disciplined capital management often emerge as leaders. Sichuan Kelun-Biotech Biopharmaceutical Co., Ltd. (6990.HK) has positioned itself as a prime example of this trend. With a recent share placement, groundbreaking clinical trials, and improving financial metrics, the company is building a compelling case for sustained growth and investor confidence.

Capital Raise: Fueling Global Ambitions

In June 2025, Kelun-Biotech executed a HK$1.96 billion share placement, upsizing from an initial target of US$200 million to US$250 million due to overwhelming demand. The 5,918,000 H shares were issued at HK$331.8, a 7.58% discount to the prior close but a 0.89% premium to the 5-day average. This oversubscription—driven by participation from global long-only funds, sovereign wealth funds, and healthcare specialists—underscores the market's recognition of the company's long-term potential.

However, the stock closed down 6.9% on the day of the announcement, a reaction that may reflect short-term profit-taking by existing shareholders or skepticism about the discount. Yet, this dip could present an opportunity for investors to assess the company's strategic use of proceeds. The funds are earmarked for R&D, clinical trials, and global commercialization, aligning with Kelun-Biotech's vision to expand its ADC (antibody-drug conjugate) platform and address unmet needs in oncology and autoimmune diseases.

Clinical Breakthroughs: A Pipeline of Promise

Kelun-Biotech's clinical advancements in 2025 highlight its ability to innovate and differentiate. The company's TROP2-directed ADC, sacituzumab tirumotecan (sac-TMT), received a fifth Breakthrough Therapy Designation from China's NMPA for non-squamous non-small cell lung cancer (NSCLC). This follows earlier designations in breast and gastric cancer, and the OptiTROP-Lung01 trial demonstrated encouraging antitumor activity in combination with tagitanlimab.

Meanwhile, the collaboration with Windward Bio on SKB378/WIN378—a TSLP-targeting monoclonal antibody for asthma and COPD—has expanded into global Phase 2 trials. The drug's long-acting formulation and potential for multiple respiratory indications position it as a blockbuster candidate. Additionally, the CLDN18.2 ADC, SKB315, is advancing into gastric cancer trials, leveraging Kelun-Biotech's proprietary OptiDC™ platform to optimize payload-linker design and tumor targeting.

These milestones reflect a pipeline of over 30 projects, with three approved therapies, one in NDA, and more than 10 in clinical development. The company's focus on first-in-class and best-in-class therapies, coupled with strategic partnerships (e.g., with MSD and Ellipses), ensures a diversified and globally competitive portfolio.

Financial Discipline: From Loss to Growth

Kelun-Biotech's financial trajectory has been equally impressive. In 2024, the company reported a 67.8% year-on-year revenue increase to RMB 1.93 billion, driven by commercial sales of its approved therapies and non-refundable payments from licensing deals. The net loss narrowed by 53.5% to RMB 267 million, a sign of improving operational efficiency.

This progress builds on 2023's 203.3% revenue surge, fueled by a USD 175 million upfront payment from MSD under a collaboration agreement for ADC development. The Series B financing (USD 200 million) and 2023 IPO (HK$1.45 billion net proceeds) have provided a capital buffer to fund R&D without overreliance on debt.

The company's debt management strategy—prioritizing equity financing and strategic partnerships—has minimized financial risk while enabling aggressive R&D investment. With the 2025 share placement, Kelun-Biotech is well-positioned to accelerate clinical milestones and prepare for commercialization of its late-stage candidates.

Investment Implications and Risks

For investors, Kelun-Biotech represents a high-conviction opportunity in the biopharma sector. Its capital raise, while initially met with a stock price decline, signals strong institutional backing and access to resources for global expansion. The clinical pipeline, particularly in ADCs and respiratory diseases, addresses markets with significant unmet needs and high pricing potential.

However, risks remain. The biotech sector is inherently volatile, and regulatory hurdles or clinical setbacks could delay approvals. Additionally, the recent stock price dip may reflect short-term skepticism about the placement's valuation. Investors should monitor key catalysts, including interim data from the POLARIS trial (mid-2026) and NDA submissions for sac-TMT and SKB315.

Conclusion: A Long-Term Catalyst

Sichuan Kelun-Biotech's strategic momentum—driven by a well-capitalized pipeline, clinical innovation, and disciplined financial management—positions it as a leader in the next generation of biopharmaceuticals. While short-term volatility is inevitable, the company's focus on global expansion, platform-based R&D, and partnerships with industry giants like MSD and Windward Bio creates a strong foundation for long-term value creation.

For investors with a multi-year horizon, Kelun-Biotech offers a compelling blend of growth potential and operational resilience. As the company advances its ADCs and respiratory therapies toward commercialization, it may well emerge as a key player in the global fight against cancer and chronic diseases.