When a drugmaker has military ties, it often invokes conspiracy theories. But in China they have seen the transformation of a military medic into a billionaire.
Che Fengsheng, a Shandong native, was born in 1962. He obtained a degree in aviation medicine at the Fourth Military Medical University in Xi’an in 1984. He first worked at a military school as an assistant lecturer, then as a neurologist in 1990 after getting a Master’s degree. In 1991 he joined the First Military Medical University as a lecturer and neurologist doctor.
In 1993, when the PLA was banned from direct involvement in commercial activities, Che had a career overhaul too, joining a Shenzhen drug firm as a salesman. What seemed to be a professional demotion would turn out to be the launch pad for his career as a drug tycoon.
In 2001 Che founded Sihuan Pharmaceutical in Hainan with a college classmate. It grew quickly as a private-sector distributor of imported medicine. It also became one of the earliest sellers of Chinese prescription drugs, mostly to hospitals.
Sihuan Pharmaceutical went public in Singapore in 2007. Dissatisfied with lukewarm investor interest, Che took it private in 2009 and relisted again in Hong Kong in 2010. It went public at a valuation five times higher than its Singapore trading level. George Soros’ Quantum fund became a cornerstone IPO investor.
Its share price has since nearly doubled and it is currently valued at around $6 billion. Rich List compiler Hurun has estimated Che’s net worth at $2.3 billion, ranking him the 90th richest among China’s tycoons.
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Sihuan Pharmaceutical has its own research and development unit, and Che is developing his own drugs. Last year Che revealed that he is searching for a cure for Ebola, for instance. During the virus outbreak in Africa last year, Sihuan Pharmaceutical said it had paid $1.6 million for the commercial rights to an experimental anti-Ebola drug (called jk-05) developed by the Chinese Academy of Military Medical Sciences (see WiC256).
“We have myriad connections with the military medical science units,” Che told investors at a conference last year. Unsurprisingly, he has focused on the positives of the relationship, noting that during the SARS outbreak in 2003, a vaccine developed by the military was speedily approved by Chinese regulators. “At that time the whole approval process was cut right down,” he said.
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