ShangPharma Corporation (NYSE:SHP) is a Chinese biotechnology and pharmaceutical research and development firm. The company sells its services to other companies who need help with the drug discovery, preclinical development, and pharmaceutical development stages. The company sells the use of its scientist and facilities on an hourly or service basis.
The outsourcing of the entire R&D process has grown rapidly during the past few years. According to Frost & Sullivan, the market has grown by an annual growth rate of 27.2% from 2007 to 2009. This growth is expected to remain above 20% until 2013. This growth is driven by the highly skilled but relatively cheap labor in China as compared to that available in most developed countries.
The company's initial public offering of stock on the NYSE occurred on October 18, 2010. The company offered 5.8M ADS shares each for $15. This was within the initial price range of $14.50-$16.50. The IPO raised a total of $87M. The lead underwriters of the deal were Citigroup (C) and J P Morgan Chase (JPM).
The company has experienced growing revenues over the past 3 years. In 2007, its total revenue was $34.7M, while in 2009, they announced revenue of $72.3M. Net Income has also risen from $7.5M in 2007, to $9.8M in 2009.