F-1/A: Cuprina Holdings Eyes Nasdaq Debut with $15.9 Million IPO

Cuprina Holdings (Cayman) Limited is set to launch its initial public offering of 3,750,000 Class A Ordinary Shares, aiming for a Nasdaq listing under the ticker CUPR.

Summary

• Cuprina Holdings (Cayman) Limited is planning an initial public offering of 3,750,000 Class A Ordinary Shares.
• The anticipated IPO price is between US$4.00 and US$4.50 per share.
• The company has applied to list its Class A Ordinary Shares on the Nasdaq Capital Market under the symbol CUPR.
• The offering is contingent upon Nasdaq's approval of the listing application.
• Resale Shareholders are offering 1,500,000 Class A Ordinary Shares through a separate resale prospectus.
• Cuprina Holdings will not receive any proceeds from the sale of shares by the Resale Shareholders.
• Post-IPO, the company will have 3,915,000 Class A Ordinary Shares and 14,085,000 Class B Ordinary Shares outstanding.
• Cuprina Holding Pte. Ltd. will control over 50% of the voting power, making Cuprina Holdings a controlled company under Nasdaq rules.
• The company is an emerging growth company and an exempted company incorporated in the Cayman Islands.
• Cuprina conducts operations through subsidiaries in Singapore, Hong Kong, Saudi Arabia, Malaysia, and mainland China.
• The company intends to use approximately 46.7% of the net proceeds for growth and expansion into new markets.
• Approximately 12.8% of the proceeds will be allocated to research and development activities.
• A portion of the proceeds, around 6.3%, will be used to repay a loan to an ultimate beneficial shareholder.
• The underwriters have a 45-day option to purchase up to 562,500 additional Class A Ordinary Shares to cover over-allotments.
• The company has agreed to issue warrants to the underwriter to purchase Class A Ordinary Shares equal to 5% of the total number of Class A Ordinary Shares sold in the offering.

Sentiment

Score: 5

Explanation: The document presents a mixed sentiment. While the company is pursuing growth opportunities and has innovative products, it also faces financial challenges and risks associated with its operations and regulatory environment. The IPO itself is a positive step, but the company's history of losses and dependence on external funding raise concerns.

Positives

• The company has strategic plans to expand sales and establish physical operations in Southeast Asia, the Middle East, and mainland China.
• The company has attained ISO 13485:2016 standards for its manufacturing facility in Singapore.
• The company is working towards obtaining compliance with 21 CFR Part 820 to secure FDA 510(k) clearance.
• The company has access to innovative technology in developing pipeline products through collaborations with research universities.
• The company is committed to sustainability, focusing on nature-derived raw materials and valorization of waste streams.
• The company has a loyal and growing customer base, primarily major public and private hospitals and clinics in Singapore.

Negatives

• The company is an early-stage company with a history of losses and expects to incur losses in the future.
• The company recorded net current liabilities as of December 31, 2021, 2022 and 2023.
• The company had net operating cash outflows for the years ended December 31, 2021, 2022 and 2023.
• The company's independent registered public accounting firm expressed substantial doubt regarding the company's ability to continue as a going concern.
• The company relies heavily on R&D partners for know-how on design, manufacturing methods and formulation of products.
• The company's maggot-based chronic wound care products are not currently protected by any pending patent application nor any unexpired patent.

Risks

• The company may not be able to achieve or sustain profitability.
• The company's revenue growth is difficult to predict, and a shortfall in forecasted revenues may harm operating results.
• The company's ability to continue as a going concern requires obtaining sufficient funding to finance operations.
• Failure to manage growth strategy could harm the business.
• The company may not be able to compete within its markets, or its products may not gain market acceptance.
• Security breaches and other disruptions could compromise information and expose the company to liability.
• The development and sale of certain pipeline products are heavily dependent on agreements with R&D partners.
• The company may be found to infringe on or violate the intellectual property rights of others.
• The company is subject to various governmental regulations relating to the labeling, marketing and sale of its products.
• Failure to obtain or maintain adequate reimbursement or insurance coverage for medical products could limit the company's ability to market those products.
• The company is dependent on its key management and skilled personnel for its continued success and growth.
• The company is exposed to foreign exchange risks.
• The company is exposed to risks associated with joint ventures or strategic alliances.
• Adverse conditions in the global financial markets and the general economy may adversely affect the company's business.
• The company is subject to credit risk arising from some of its customers.
• The company requires adequate working capital for its operations.
• The company is dependent on a few of its major customers and suppliers.
• The reduction or discontinuation of government grants currently available to the company may have a material adverse effect on its business operations and financial condition.
• The company's historical growth and performance may not be indicative of its future growth and performance.
• The company plans to expand its business operations into new geographic markets including mainland China and Hong Kong, which could subject it to rules, regulations and influence of regulators in those jurisdictions.
• The company will be a controlled company within the meaning of the rules of Nasdaq and, as a result, will rely on exemptions from certain corporate governance requirements that provide protection to shareholders of other companies.
• It may be difficult for you to enforce any judgment obtained in the United States against us, our directors, executive officers or our affiliates.
• The ability of our subsidiary in Singapore to distribute dividends to us may be subject to restrictions under applicable laws.
• It is not certain if we will be classified as a Singapore tax resident.
• Any adverse material changes to the Singapore market (whether localized or resulting from economic or other conditions) such as the occurrence of an economic recession, pandemic or widespread outbreak of an infectious disease (such as COVID-19), could have a material adverse effect on our business, results of operations and financial condition.
• An active trading market for our Class A Ordinary Shares may not be established or, if established, may not continue and the trading price for our Class A Ordinary Shares may fluctuate significantly.
• The offering price of the primary offering and resale offering could differ.
• We may not maintain the listing of our Class A Ordinary Shares on the Nasdaq which could limit investors ability to make transactions in Class A Ordinary Shares and subject us to additional trading restrictions.
• The trading price of our Class A Ordinary Shares may be volatile, which could result in substantial losses to investors.
• If securities or industry analysts do not publish research or reports about our business, or if they adversely change their recommendations regarding our Class A Ordinary Shares, the market price for our Class A Ordinary Shares and trading volume could decline.
• Our corporate actions are significantly influenced by our directors, officers and principal shareholders, who have the ability to exert significant influence over important corporate matters that require approval of shareholders while their interests may differ from those of the other shareholders.
• The dual-class structure of our ordinary shares may adversely affect the trading market for our Class A Ordinary Shares.
• The sale or availability for sale of substantial amounts of our Class A Ordinary Shares could adversely affect their market price.
• Certain recent initial public offerings of companies with public floats comparable to our anticipated public float have experienced extreme volatility that was seemingly unrelated to the underlying performance of the respective company.
• Because our public offering price per Class A Ordinary Shares is substantially higher than our net tangible book value per Class A Ordinary Shares, you will experience immediate and substantial dilution.
• You must rely on the judgment of our management as to the uses of the net proceeds from this offering, and such uses may not produce income or increase our share price.
• If we are classified as a passive foreign investment company, United States taxpayers who own our securities may have adverse United States federal income tax consequences.
• We may need additional capital, and we may be unable to obtain such capital in a timely manner or on acceptable terms, or at all.
• We are an emerging growth company within the meaning of the Securities Act and may take advantage of certain reduced reporting requirements.
• We are a foreign private issuer within the meaning of the Exchange Act, and as such we are exempt from certain provisions applicable to United States domestic public companies.
• As a company incorporated in the Cayman Islands, we are permitted to adopt certain home country practices in relation to corporate governance matters that differ significantly from Nasdaq corporate governance listing standards.
• We may lose our foreign private issuer status in the future, which could result in significant additional costs and expenses to us.
• We will incur significantly increased costs and devote substantial management time as a result of the listing of our Class A Ordinary Shares on the Nasdaq.
• You may face difficulties in protecting your interests, and your ability to protect your rights through U.S. courts may be limited, because we are incorporated under Cayman Islands law.
• If we fail to maintain an effective system of internal controls over financial reporting, we may not be able to accurately report our financial results or prevent fraud and our business may be harmed and our stock price may be adversely impacted.
• Certain judgments obtained against us by our shareholders may not be enforceable.

Future Outlook

The company plans to expand its sales and establish physical operations in Southeast Asia, the Middle East, and mainland China in the second half of 2024 and 2025. The company also plans to explore the possibility of developing a range of potential cosmeceutical product candidates incorporating bullfrog collagen with a view to making them commercially available between 2024 and 2028, subject to the progress of the relevant R&D work.

Industry Context

The company operates in the biomedical and biotechnology industry, focusing on chronic wound care and cosmeceuticals. The chronic wound care market is expected to grow due to an aging population and increased prevalence of comorbidities. The company aims to differentiate itself through innovative products derived from natural sources.

Comparison to Industry Standards

• The global chronic wound care market was valued at US$11.6 billion in 2021 and is projected to reach US$19.5 billion by 2029, reflecting a CAGR of 6.7%.
• Key players in the wound care market include Smith & Nephew plc, ConvaTec Group plc, Mlnlycke Health Care AB, 3M, Integra Urgo Group, among others.
• The company's focus on cost-effectiveness and value proposition aligns with the needs of developing economies like mainland China.
• The company's commitment to sustainability and ethical sourcing practices may appeal to a growing consumer base.
• The company's reliance on third-party manufacturers for cosmeceutical products is a common practice in the industry.
• The company's collaboration with Nanyang Technological University (NTU) for R&D is similar to other specialized products companies that have formed collaborations with large, established companies to support research, development, and commercialization of wound care and cosmeceutical products which may be competitive with ours.

Related Party Transactions

• Cuprina Holding Pte. Ltd. provided financial assistance to the company for working capital purposes.
• Jimmy Lee Peng Siew provided advances to the company for working capital purposes.
• David Quek Yong Qi provided an advance to the company for working capital purposes.
• Bryan Teo Yingjie provided an advance to the company for working capital purposes.
• Rachel Lee Lin provided an advance to the company for working capital purposes.

Stakeholder Impact

• Shareholders will be affected by the potential dilution of their ownership due to the issuance of new shares.
• Employees may be affected by the company's ability to attract, cultivate, and retain a talented and professional workforce.
• Customers may benefit from the company's commitment to quality and the development of innovative products.
• Suppliers may be affected by the company's ability to maintain stable relationships and ensure timely payments.
• Creditors may be affected by the company's ability to generate sufficient revenue or raise additional funds to repay outstanding debt obligations.

Next Steps

• Obtain Nasdaq approval for listing.
• Complete the initial public offering.
• Expand into new geographic markets through strategic partnerships.
• Continue to expand product portfolio through development and innovation.
• Strengthen brand awareness and acquire and retain customers.
• Attract, cultivate, and retain a talented and professional workforce.

Key Dates

Keywords

IPO, Class A Ordinary Shares, Cuprina Holdings, Nasdaq, Biomedical, Biotechnology, Wound Care, Cosmeceuticals, Emerging Growth Company, Cayman Islands