WuXi said to tap banks for spinoff of USD1.5 billion biologics arm

WuXi PharmaTech (Cayman) Inc., China’s biggest contract medical researcher, has picked banks for an initial public offering of its biologics unit that could value the business at about USD1.5 billion, people with knowledge of the matter said.
WuXi PharmaTech hired Bank of America Corp. and Morgan Stanley to arrange a Hong Kong share sale for the unit, according to the people, who asked not to be identified because the information is private. The offering could take place as soon as the second half of this year, the people said.
A listing of the biologics business would give investors access to one of the fastest-growing areas of the pharmaceutical industry. Biopharmaceuticals, which are more complex to research and manufacture than other drugs, usually contain live ingredients and can address previously untreatable conditions with higher efficacy and fewer side effects.
WuXi PharmaTech, which previously traded on the New York Stock Exchange, is also considering a domestic listing of the entire group some time after 2016, according to one of the people. Plans are still at an early stage, the person said. Aaron Shi, a spokesman for WuXi, declined to comment.
The offerings would add to the $57.5 billion of first-­time share sales in greater China over the past 12 months, according to data compiled by Bloomberg. Bloomberg