Jingxin Pharmaceutical Files Again for Hong Kong IPO as H1 2026 Revenue and Profit Decline

Source: Blue Whale News, September 21 (Reporter: Tu Jun)

On September 18, 2026, Zhejiang Jingxin Pharmaceutical Co., Ltd. (002020.SZ) submitted its listing application to the Main Board of the Hong Kong Stock Exchange for the second time, with CITIC Securities acting as the sole sponsor. This marks the company's second attempt at an "A+H" capital structure following the lapse of its initial filing in February of this year. For this veteran pharmaceutical company, listed on the A-share market for over 20 years, the move comes at a critical juncture as it navigates sluggish growth in its core generic drug business while its innovation transformation remains a work in progress.

Revenue Stagnation with Only One Innovative Drug on the Market

Founded in 1999 and listed on the Shenzhen Stock Exchange in 2004, Jingxin Pharma generates revenue from pharmaceuticals, active pharmaceutical ingredients (APIs), and medical equipment. Its core therapeutic areas are central nervous system (CNS) and cardiovascular/cerebrovascular diseases, alongside products for digestive and infectious diseases.

• Revenue Structure (2023-2025): Drug sales consistently accounted for approximately 60% of total revenue, APIs over 20%, and medical equipment around 17%.
• Generic Drugs: Over 40 products have passed consistency evaluations or been approved under new drug registration categories. In 2025, Levetiracetam tablets and Pramipexole hydrochloride tablets ranked first in their respective generic markets by sales revenue, holding shares of approximately 38.1% and 32.4%.
• APIs: Shaoxing Jingxin is a leading global producer of quinolone anti-infective APIs, generating RMB 814 million in API revenue in 2025.
• Medical Equipment: Operated by subsidiary Shenzhen Julong, the segment focuses on medical imaging display terminals and is a manufacturer that has passed on-site FDA review in the U.S.

Financial Performance

Despite these strengths, financial data reveals stagnation:

| Metric | 2023 | 2024 | 2025 | H1 2026 | | :--- | :--- | :--- | :--- | :--- | | Revenue (RMB) | 3.999 billion | 4.159 billion | 4.069 billion | 1.987 billion | | Revenue Growth | - | +4.0% | -2.2% | -1.46% YoY | | Gross Margin | 49.2% | - | 48.2% | - | | Net Profit (RMB) | 618.9 million | - | 758 million | 352 million | | Net Profit Growth | - | - | - | -9.35% YoY |

In its prospectus, Jingxin explained that the 2025 revenue decline was primarily due to lower average selling prices for certain drugs and APIs under the Volume-Based Procurement (VBP) scheme, only partially offset by a significant sales volume increase for its drug Didaxini after it was included in the National Reimbursement Drug List (NRDL).

Profit Growth Driven by Cost Cuts, Not Expansion

While net profit grew from RMB 618.9 million in 2023 to RMB 758 million in 2025, this was achieved through expense reduction:

• 2025: Selling & marketing expenses cut from RMB 692 million to RMB 601 million; R&D costs reduced from RMB 383 million to RMB 368 million.
• H1 2026: Selling expenses fell 12.26% YoY; R&D investment fell 10.89% YoY. However, the benefits of cost-cutting appear to have peaked, as both revenue and net profit declined in the first half of 2026.

Innovation Pipeline: A Single Drug Faces Growing Competition

Jingxin's transformation hopes rest on innovative drugs. Its only approved Class 1 innovative drug is Didaxini (brand name: Jingnuoning), approved in November 2023 for insomnia and included in the NRDL in November 2024. According to Frost & Sullivan data cited in the prospectus, it is the first Class 1 innovative insomnia drug developed and approved by a Chinese company since 2007.

• Commercialization: Didaxini generated RMB 195 million in sales in 2025 and RMB 153 million in H1 2026. By end-2025, it had been adopted by over 3,000 hospitals nationwide, including more than 900 tertiary hospitals. Management expects continued strong growth in 2026.
• Competition: The first-mover advantage is narrowing. Lemborexant (Eisai) and Daridorexant (Xiansheng Pharma) were approved in 2025. In May 2026, Yangtze River Pharmaceutical's Fazamorexant, the first domestic dual orexin receptor antagonist, was also approved.

The most advanced candidate in the pipeline is JX2201, targeting the Lp(a) cardiovascular risk factor. It is currently in Phase II clinical trials, with out-licensing efforts also underway. Notably, Jingxin's R&D spending as a percentage of revenue was approximately 10% from 2023-2025, below the 15%-20% typical for innovative drug companies. Industry insiders suggest this explains the relatively slow pace of its overall innovation pipeline.

Tax Penalty Casts a Shadow

During the Hong Kong listing process, a compliance issue has drawn market attention. According to the prospectus, in December 2024, tax authorities imposed an administrative fine of RMB 800,000 on Jingxin for two issues:

1. Some 2023 R&D expenses were deemed unrelated to R&D activities, resulting in underpayment of corporate income tax of approximately RMB 1 million.
2. Failure to withhold and remit individual income tax of approximately RMB 400,000 in 2021 and 2023.

Consequently, Jingxin recorded an under-provision of tax for prior years of approximately RMB 13.4 million in its 2024 financial report. This includes supplementary corporate income tax for 2021-2023 (approx. RMB 10.8 million), final settlement adjustments (approx. RMB 1.6 million), and the aforementioned underpaid corporate income tax (approx. RMB 1 million). The company also recorded a tax surcharge of approximately RMB 3.3 million in 2024, comprising the RMB 800,000 fine and approximately RMB 2.5 million in late payment fees.

Jingxin stated in the prospectus that, considering the incident is isolated and one-off, the fine amount is not material, and it does not involve director fraud or dishonesty, its Chinese legal counsel and the sole sponsor believe the event will not have a material adverse impact on the directors' suitability under Listing Rules 3.08 and 3.09.

Gui Xin, a senior partner at Tahota Law Firm and founder of Tianmu Venture Capital Ecosystem, told Blue Whale News that improper R&D expense classification essentially involves allocating expenses that do not meet tax and accounting standards. While the penalty itself does not directly determine IPO success, Hong Kong regulators will focus on whether there is evidence of profit manipulation or material internal control deficiencies.

Conclusion

Jingxin Pharma's core generic drug and API business is decelerating under the pressure of VBP normalization and price competition, while its innovation business is still in its infancy. This second filing for a Hong Kong listing is both a strategic choice to secure growth capital for its transformation and a test of its ability to convince the capital market of its "innovation pivot" story. The sales trajectory of Didaxini, the development speed of follow-up pipeline candidates like JX2201, and the sustainability of its cost-cutting strategy will collectively determine whether this established pharmaceutical company can successfully navigate its transition.