Summary of the Conference Call for 康哲药业 (Kangzhe Pharmaceutical) Company Overview - 康哲药业 is undergoing a strategic transformation from pursuing sustainable growth to focusing on depth and breadth development, including establishing R&D institutions, investing in product centers, and introducing new products [2][3][4] Key Industry Insights - The company is prioritizing internationalization, targeting Southeast Asia and the Middle East markets, while also focusing on dermatology and ophthalmology in China [2][4] - 德美医药 (Demei Pharmaceutical), a subsidiary, is positioned as a leading innovative pharmaceutical company in skin health, with a projected revenue of 618 million yuan in 2024 and a compound annual growth rate (CAGR) of over 50% expected in the next five years [2][9] Core Points and Arguments - The decision to spin off 德美医药 aims to showcase 康哲's transformation achievements and to allow 德美 to operate independently, enhancing shareholder value without diluting existing equity [3][8] - 德美医药 has developed a rich product line from a single product, with several products achieving annual sales of hundreds of millions, and is expected to become profitable by 2026 [5][32] - 康哲's original business is expected to maintain a growth rate of over 10% post-spin-off, driven by exclusive products and new market contributions [3][26] Financial Performance and Projections - 德美医药's revenue for the past three years was 384 million (2022), 473 million (2023), and is projected to reach 618 million (2024) [9] - The skin disease treatment and care market in China is valued at 76.4 billion yuan, with a projected CAGR of over 10% until 2035 [9] Product Development and Market Strategy - 德美医药 has established a skin health research institute and plans to launch at least two new products annually, focusing on unmet clinical needs in skin diseases [11][16] - The company has a diverse product matrix, including treatments for psoriasis and atopic dermatitis, with significant market potential [12][14] R&D and Commercialization - 德美医药's R&D budget is set at no less than 200 million yuan annually, with a commitment to increasing investment by over 30% CAGR [30] - The company has over 650 sales personnel covering more than 10,000 pharmacies and hospitals, enhancing its market reach [37] Future Outlook - 德美医药 aims for a 50% CAGR in revenue over the next five years, driven by new product launches and enhanced market penetration [28][32] - The spin-off is expected to be completed with an IPO planned for 2025, with sufficient capital to support growth and profitability [36] Additional Considerations - The impact of the centralized procurement policy on profit margins and the strategic response to maintain competitive advantages in exclusive innovative drugs [17][23] - The potential for collaboration with other pharmaceutical companies to expand product offerings and market presence [22][31]

香港交易及結算所有限公司及香港聯合交易所有限公司對本公告的內容概不負責，對其 準確性或完整性亦不發表任何聲明，並表明概不就因本公告全部或任何部分內容而產生 或因倚賴該等內容而引致的任何損失承擔任何責任。 關於在二零二五年四月二十四日舉行的股東週年大會的投票結果公告 於二零二五年四月二十四日舉行的China Medical System Holdings Limited（「本公司」） 股東週年大會（「股東週年大會」）上，載於日期為二零二五年四月二日的股東週年大會 通告內的所有提呈決議案均以投票表決方式獲正式通過。 如日期為二零二五年四月二日的股東週年大會通函（「通函」）所述，本公司於通函最後 實際可行日期之已發行股份總數為2,439,528,512股。有關股東週年大會上提呈的所有決 議案，賦予持有人出席股東大會並於會上就決議案投贊成或反對票權利的本公司股份合 共2,439,528,512股。股東於股東週年大會提呈之所有決議案進行投票並無任何限制。概 無本公司股份根據香港聯合交易所有限公司證券上市規則（「上市規則」）第13.40條賦予 股東權利出席股東週年大會並須就會上提呈的任何決議案放棄投贊成票。概無任何股東 ...

Core Viewpoint - 康哲药业 plans to spin off its skin health subsidiary, 德镁医药, for independent listing on the Hong Kong Stock Exchange, allowing shareholders to receive shares through a distribution method without new stock issuance [1][5] Company Overview - 德镁医药 focuses on skin health, offering comprehensive solutions for skin diseases such as psoriasis, vitiligo, atopic dermatitis, and acne, with a strong competitive edge in addressing unmet clinical needs [2][3] - 康哲药业 will concentrate on its core areas, including cardiovascular, central nervous system, digestive, and ophthalmic specialties, optimizing its asset structure post-spin-off [4][5] Market Potential - The skin disease treatment and care market in China is projected to reach RMB 764 billion in 2023, with a compound annual growth rate of 10.6% from 2023 to 2035, indicating significant growth potential for 德镁医药 [3] - 德镁医药's product pipeline includes competitive offerings such as JAK1/2 topical cream and IL-23 monoclonal antibody injection, supported by a commercial team of over 650 professionals [3] Strategic Benefits - The spin-off is expected to enhance both 康哲药业 and 德镁医药's market positions, allowing for independent fundraising and improved operational efficiency [1][4] - The separation will enable 德镁医药 to establish its own valuation system, potentially unlocking greater growth opportunities and attracting investors [5]

Core Viewpoint - CICC maintains its earnings forecast for Kangzheng Pharmaceutical (00867) and keeps the target price at HKD 11.00, corresponding to adjusted P/E ratios of 14.6x and 13.1x for 2025 and 2026 respectively, while the stock is currently trading at 10.8x and 9.7x [1] Group 1: Spin-off Proposal - The company announced a proposal to spin off its subsidiary, Demai Pharmaceutical, for independent listing on the Hong Kong Stock Exchange, pending approvals from relevant authorities and boards [1] - The proposed spin-off will be executed through a physical distribution of shares to existing shareholders, ensuring no dilution of original shareholders' rights [2] Group 2: Demai Pharmaceutical Overview - Demai Pharmaceutical focuses on skin health, with a rich product pipeline including prescription drugs and skincare products [3] - Currently marketed products include Turekizumab (IL-23 for psoriasis), Anshuxi (for varicose veins), and Xiliaotuo (for superficial venous inflammation and bruises), with significant products in development [3] - The company expects to achieve revenue of CNY 618 million in 2024, representing a year-on-year growth of 30.7% [3] Group 3: Potential Benefits of Spin-off - The spin-off is expected to allow Demai Pharmaceutical to conduct independent financing activities, potentially improving operational and financial performance [4] - It is anticipated that the independent listing will enhance Demai Pharmaceutical's business status and market image, supported by two equity incentive plans to motivate employees [4]

香港交易及結算所有限公司及香港聯合交易所有限公司對本公告的內容概不負責，對其準確性或完整性亦不發表任 何聲明，並表明概不就因本公告全部或任何部分內容而產生或因倚賴該等內容而引致的任何損失承擔任何責任。 本公告僅供參考，並不構成或屬於任何招股章程一部分、收購、購買或認購任何證券的邀請或要約，其或其任何部 分概不構成任何合約或承諾的基礎或依據。具體而言，本公告並不構成亦非在香港或其他地方出售證券的要約或要 約購買證券的招攬。 CHINA MEDICAL SYSTEM HOLDINGS LIMITED 康哲藥業控股有限公司* （於開曼群島註冊成立的有限公司） （股份代號：867） 建議分拆德鎂醫藥有限公司並於 香港聯合交易所有限公司主板獨立上市 本公司建議將本公司附屬公司德鎂醫藥股份分拆並於聯交所主板獨立上市。建議分拆（倘進行）預計將 透過由本公司以實物方式向股東分派其持有的所有德鎂醫藥股份的方式實施，分派比例將按截至董事會 為確定股東權利而釐定的記錄日期當日彼等各自於本公司的持股比例計算。 根據上市規則第 15 項應用指引，德鎂醫藥股份於聯交所獨立上市，構成本公司對德鎂醫藥的分拆。聯交 所已確認本公司可進行建議分 ...

香港交易及結算所有限公司及香港聯合交易所有限公司對本公告的內容概不負責，對其 準確性或完整性亦不發表任何聲明，並表明概不就因本公告全部或任何部分內容而產生 或因倚賴該等內容而引致的任何損失承擔任何責任。 建議修訂現行組織章程大綱及細則 及採納新訂組織章程大綱及細則 鑒於建議的變更數量較多，董事會提議採納并整合上述建議修訂，通過採納整合了建議 修訂內容的第五次經修訂及重述的組織章程大綱及細則（「新組織章程大綱及細則」） *僅供識別 1 (a) 說明本公司回購的任何股份可予註銷或作為庫存股持有； (b) 規定以電子方式提交代表委任表格的相關安排； (c) 允許就使用電子方式進行投票作出安排； (d) 取消股份轉讓文書必須以手寫簽名簽立的規定； (e) 使本公司能夠通過在本公司網站及聯交所網站發佈公告的方式發出通知； (f) 允許以銀行轉賬及電子方式支付現金股息； (g) 取消以非現金資產形式分派股息時須獲得股東批准的規定； (h) 允許董事通過電子確認方式通過書面決議；以及 (i) 對本公司章程細則所作的其他輔助性及內部管理方面的修訂。 的方式，以取代並解除現有組織章程大綱及細則。 建議修訂及採納新組織章程大綱及 ...

Investment Rating - The report maintains an "Outperform" rating for the company [2][16]. Core Views - The company reported a total revenue of RMB 7.47 billion for 2024, a decrease of 6.8% year-on-year, with pharmaceutical sales revenue at RMB 8.62 billion, down 9.0% [12][3]. - The impact of volume-based procurement (VBP) on existing products has largely been digested, with significant sales declines in certain product lines, while innovative products are showing growth [13][4]. - The company has made substantial progress in its innovative drug pipeline, with five products already commercialized and additional assets submitted for NDA approval [14][5]. Financial Performance - Revenue for 2024 was RMB 7.47 billion, down 6.8%, with a gross margin of 72.6%, a decline of 3.6 percentage points due to price cuts from VBP [12][3]. - R&D expenditure increased by 8.9% to RMB 890 million, accounting for 11.9% of total revenue, while selling expenses rose by 6.0% to RMB 2.66 billion [12][3]. - The annual profit was RMB 1.61 billion, down 32.3%, with adjusted net profit at RMB 1.71 billion, down 36.7% year-on-year [12][3]. Sales Breakdown - Cardiovascular and cerebrovascular product line sales were RMB 4.09 billion, down 18.8%, while dermatology and ophthalmology segments showed strong growth [13][4]. - Revenue from three VBP products was RMB 2.69 billion, down 28.8%, indicating that the short-term impact of centralized procurement has largely played out [13][4]. Earnings Forecast and Valuation - Revenue forecasts for 2025 and 2026 have been adjusted to RMB 8.37 billion and RMB 9.44 billion, respectively, reflecting year-on-year growth of 11.5% and 13.3% [15][8]. - The target price is maintained at HKD 9.96 per share, corresponding to a 14x PE for 2025 [16][8].

Investment Rating - The report maintains an "Outperform" rating for the company [2][15]. Core Views - The company reported a total revenue of RMB 7.47 billion for 2024, a decrease of 6.8% year-on-year, with pharmaceutical sales revenue at RMB 8.62 billion, down 9.0% [11][12]. - The impact of volume-based procurement (VBP) on existing products has largely been digested, with significant sales declines in certain product lines, while innovative products are showing growth [12][14]. - The company has made substantial progress in innovative drug development, with five products already commercialized and additional candidates in various stages of clinical trials [13][14]. Financial Performance Summary - Revenue for 2024 was RMB 7,469 million, down 12% from the previous year, with a projected recovery to RMB 8,326 million in 2025, representing an 11% increase [3][7]. - Net profit for 2024 was RMB 1,620 million, a decline of 32% year-on-year, with an expected increase to RMB 1,671 million in 2025, reflecting a 4% growth [3][7]. - The gross margin decreased to 72.6%, primarily due to price reductions from VBP, while R&D expenditure rose to RMB 890 million, accounting for 11.9% of total revenue [11][12]. Product Line Performance - Cardiovascular and cerebrovascular products generated RMB 4.09 billion in sales, down 18.8%, while dermatology and aesthetic medicine products grew by 18.2% to RMB 670 million [12][14]. - The three VBP products achieved revenue of RMB 2.69 billion, down 28.8% year-on-year, indicating that the short-term impact of centralized procurement has largely played out [12][14]. Innovation and Pipeline - The company has five innovative drugs commercialized, with two additional products submitted for NDA approval, including a potential blockbuster [13][14]. - Over ten clinical-stage innovative programs are progressing, including treatments for various conditions such as stroke and obesity [13][14]. Earnings Forecast and Valuation - Revenue forecasts for 2025 and 2026 have been adjusted to RMB 8.37 billion and RMB 9.44 billion, respectively, reflecting year-on-year growth of 11.5% and 13.3% [14][15]. - The target price is maintained at HKD 9.96 per share, corresponding to a 14x PE for 2025 [15].

股東週年大會通告 股東週年大會通告 CHINA MEDICAL SYSTEM HOLDINGS LIMITED 康哲藥業控股有限公司 * （於開曼群島註冊成立之有限公司） （股份代號：867） 茲通告 China Medical System Holdings Limited(「本公司」，連同其附屬公司稱為「本集團」) 謹訂於二零 二五年四月二十四日（星期四）上午十時於香港特別行政區中區法院道太古廣場港島香格里拉 5 樓天山及廬 山廳舉行股東週年大會（「股東週年大會」），以處理下列事項： 普通決議案 * 僅供識別 1 1. 省覽、考慮及採納截至二零二四年十二月三十一日止年度之本集團經審核之綜合財務報表、本公司董事 （「董事」）會（「董事會」）與核數師之報告； 2. 批准建議的截至二零二四年十二月三十一日止年度之末期股息，每股人民幣 0.1174 元（相當於 0.127 港元）； 3. (a) 重選陳燕玲女士為執行董事； (b) 重選梁創順先生為獨立非執行董事； (c) 重選羅瑩女士為獨立非執行董事；及 (d) 授權董事會釐定董事酬金。 4. 續聘德勤·關黃陳方會計師行為本公司核數師及授權董事會釐定其酬金； 股 ...

此乃要件 請即處理 閣下對本通函任何方面或對應採取之行動如有任何疑問，應諮詢 閣下之註冊證券商、銀行經理、律師、專業 會計師或其他專業顧問。 閣下如已售出或轉讓名下全部 China Medical System Holdings Limited 股份，應立即將本通函及所附隨之 代表委任表格送交買主或承讓人，或經手買賣之銀行、股票經紀或其他代理商，以便轉交買主或承讓人。 香港交易及結算所有限公司及香港聯合交易所有限公司對本通函之內容概不負責，對其準確性或完整性亦不 發表任何聲明，並明確表示概不會就本通函全部或任何部份內容而產生或因倚賴該等內容而引致之任何損失 承擔任何責任。 本通函僅供參考，並不構成收購、購買或認購證券的邀請或要約。 CHINA MEDICAL SYSTEM HOLDINGS LIMITED 康哲藥業控股有限公司* （於開曼群島註冊成立之有限公司） 本公司謹訂於二零二五年四月二十四日星期四上午十時於香港特別行政區中區法院道太古廣場港島香格里拉 5 樓天山及廬山廳舉行股東週年大會（「股東週年大會」），大會通告載於本通函第 21 頁至 25 頁。隨函附 上適用於股東週年大會之代表委任表格。該等代表委 ...