  two chinese companies drug maker lianbio and hotel operator autour are moving ahead with us ipos after a threemonth pause on such listings   neither company is using the controversial vie structure and neither comes from the sensitive internet sector a year ago the imminent ipo by chinese company lianbio nasdaq lian wouldn’t have drawn much attention the biotech specialist’s offering is noteworthy for its large size aiming to raise 345 million but in the broadest terms the company is just one of dozens of revenueless lossmaking chinese drug startups to publicly list in new york and hong kong over the last five years but these are no ordinary times those who follow this space will recall that us ipos by chinese companies ground to a halt in july shortly after the listing by the uberlike didi global nyse didi that listing attracted the wrath of china’s internet regulator which said didi had failed to complete a mandatory review under the country’s yearold data security law before the ipo that clash cast a cloud over the pipeline of other chinese companies lining to list up in the us at that time since most also possessed big amounts of user data that might be subject to a review then in late july the us securities regulator effectively shut off the flow completely by temporarily suspending all new ipos by chinese companies the securities and exchange commission sec took that step over concerns about risks associated with a corporate structure that most chinese companies listing in the us were using called a variable interest entity vie more broadly the sec also seemed to be saying it was time to pause such listings and reevaluate how those chinese companies discuss their unique risks for investors – mostly related to china’s unpredictable regulation – in their ipo prospectuses such risks were always included in past chinese ipo prospectuses but often in very general terms at the bottom of the “risk” section now it appears that after the pause of about three months the flow may be starting to resume in fact there are at least two chinese ipos now in the pipeline lianbio is the newest first filing a prospectus on oct 1 followed by eight more filings including its latest updated version last friday the other is from atour lifestyle holdings ltd atatus an operator of higherend hotels with a strong inroom shopping element unlike lianbio atour made its first public ipo filing in june before all the controversy erupted its listing plan then went silent from midjuly until the end of august during the height of the noise since then it has filed two updated prospectuses including the latest on sept 20 atour’s ipo is also quite ambitious aiming to raise up to 350 million both atour and lianbio have set price ranges for their listings which usually means an actual trading debut should be near but in this case we should note that more than a month has now passed with no new filings from atour both of these new offerings are most notable for the fact that neither is using the vie structure lianbio specifically notes that it is not using the structure in its prospectus while atour’s prospectus contains no mention of the term both companies are offering american depositary shares adss continuing a practice used by most chinese companies we’ll look very quickly at the actual businesses of lianbio and atour at the end of this review though in this unusual case that element is lesssignificant instead the mostsignificant element is that these listings are coming to market after the earlier controversy which seems to signal we could see more chinese listings resume soon one interesting point to watch will be whether future listings abandon their vie structures which has been a big point of contention from both us and chinese regulators the structure was originally aimed at skirting chinese rules that forbid foreign ownership of internet companies since the vie structure allows us shareholders to own profits from the listed companies without actually owning any of their assets one place where we can expect big changes is in the “risk” section of chinese companies going forward that new reality was most evident in lianbio’s prospectus whose “risk” section occupied 87 of its 302 pages – or nearly a third of the report what’s more the big chinarelated risks were all the beginning of lianbio’s “risk” section unlike past ipo prospectuses where such risks were often vague and buried at the bottom of the section lianbio’s risk section was led off by highprofile risks related to changes in china’s economic policies the potential for chinese government interference in its operations friction in uschina relations and risks related to compliance with the data security law by comparison atour’s “risk” section looked more like the oldstyle prospectuses with most of those risks in the lower part of the section atour’s latest prospectus was notable for the addition of a section on the data security law which wasn’t included in the original prospectus from june all that said we’ll wind down with some quick financials for anyone who might be interested in buying into these two offerings despite all their risks lianbio is the usual revenueless drug startup licensing drugs from western companies to develop for the china market the company was only incorporated in mid2019 and reported a 162 million net loss in the first six months of this year versus a 66 million loss a year earlier it has nine drugs in its pipeline for treatment of conditions including cardiovascular and inflammatory diseases as well as cancer atour’s financials look a bit more mature the company operates 654 hotels most of those managed by atour under contracts with thirdparty owners like many travelrelated companies it suffered in the first half of the last year during the height of the pandemic but has rebounded sharply since then its revenue rose 83 in the first half of this year from the yearago period to 990 million yuan 155 million it also returned to the black in the first half of the year with a 707 million yuan profit reversing a 1025 million yuan loss in the yearago period