Core Viewpoint - The recent developments in the innovative drug sector, particularly the record-breaking licensing deal and the upcoming ASCO conference, highlight the growing competitiveness and potential of Chinese pharmaceutical companies in the global market [4][5]. Group 1: Market Performance - The Hong Kong Innovative Drug ETF (159570) opened high but closed lower, experiencing a 1% pullback after four days of gains last week, with trading volume reaching 300 million, indicating strong liquidity [1]. - Major component stocks of the ETF mostly declined, with notable drops including a more than 4% decrease for 3SBio and over 3% for both WuXi AppTec and Rongchang Biopharmaceutical [2]. Group 2: Licensing Deal - A historic licensing agreement was reached where Pfizer will pay a $1.25 billion upfront fee to Chinese companies for the PD-1/VEGF dual antibody SSGJ-707, with potential total payments reaching $4.8 billion [4]. - This deal sets a new record for Chinese innovative drugs entering the international market and is expected to enhance market valuation expectations for the innovative drug sector [4]. Group 3: ASCO Conference Insights - The upcoming ASCO conference is anticipated to showcase the global competitiveness of Chinese pharmaceutical companies, with numerous clinical studies being presented [5]. - Key highlights include the performance of domestic drugs that have shown potential to outperform established treatments, such as the combination of Bemarituzumab and Anlotinib against Keytruda in NSCLC [5]. - CAR-T therapies are also making significant strides, with Kintor Pharmaceuticals presenting promising data for their CLDN18.2 CAR-T therapy [5]. Group 4: Innovative Drug ETF Characteristics - The Hong Kong Innovative Drug ETF (159570) has a high concentration in innovative drugs, with over 85% of its weight in this category, making it the highest among all pharmaceutical indices [6]. - The ETF features a low valuation, with a five-year price-to-sales ratio at the 48.5th percentile, indicating potential undervaluation in the innovative drug sector [6].

Group 1: Smart Manufacturing - The State Council has approved the "Green and Low-Carbon Development Action Plan for Manufacturing Industry (2025-2027)", emphasizing the need for green technology innovation and the promotion of advanced green technologies [1] - The plan aims to accelerate the deep green transformation of traditional industries, with a target of reaching 6,430 national-level green factories by 2024, contributing approximately 20% to the total manufacturing output value [1] - By 2030, the output value of green factories is expected to exceed 40% of the total manufacturing output value, indicating a significant shift towards sustainable practices in the manufacturing sector [1] Group 2: Economic Development Zones - The Ministry of Commerce has issued a plan to deepen the reform and innovation of national-level economic and technological development zones, supporting major industrial technology innovation platforms and digital transformation initiatives [2][3] - The plan aims to transform these zones from traditional manufacturing bases to open, innovative, and green economic hubs, with an expected total output value of 15 trillion yuan by 2025, accounting for 20% of the national GDP [3] Group 3: Digital Identity - The Ministry of Public Security and other departments have released the "National Network Identity Authentication Public Service Management Measures," which will take effect on July 15, 2025, aimed at protecting personal information while verifying user identities online [4] Group 4: Robotics - Shenzhen Kaihong Digital Industry Development Co., Ltd. has launched the first open-source HarmonyOS-based robot operating system, M-RobotsOS, which will support various types of intelligent robots [5] - The demand for operating systems in the robotics industry is expected to grow significantly, with an estimated market demand of over 21 billion yuan driven by the deployment of one million robots [5] Group 5: Low Earth Orbit Satellites - China's low Earth orbit satellite communication system has entered the public testing phase, with plans to provide network connectivity in areas lacking coverage by the second half of the year [6] - By April 2025, China Telecom, in collaboration with major smartphone brands, plans to launch 30 models of devices that support direct satellite connectivity, marking a shift from specialized to consumer markets [6] Group 6: Energy Storage - The first large-scale lithium-sodium hybrid energy storage station in China has been put into operation, integrating the advantages of lithium and sodium batteries to enhance the energy storage industry [7] - The energy storage sector is expected to see a rebound in profitability and growth opportunities, driven by new technologies and increasing demand for energy transition solutions [7]

Group 1 - Pfizer announced the acquisition of the global rights (excluding mainland China) for the PD-1/VEGF dual antibody drug SSGJ-707 from 3SBio for a total of $6.05 billion, marking a significant milestone for Chinese pharmaceutical innovation [1] - The global pharmaceutical landscape is shifting, with multinational companies increasingly acquiring innovative drug assets from Chinese firms, as evidenced by 29% and 31% of new drug assets being licensed from Chinese companies in 2023 and 2024, respectively [1] - The improvement in China's pharmaceutical industry capabilities in target discovery, molecular design, and R&D efficiency has led to a stronger position in the PD-1/VEGF dual antibody segment, with Chinese companies holding significant influence [1] Group 2 - The success of Chinese innovative drugs is breaking the traditional "follow-up innovation" model, with higher-quality Chinese drugs and R&D pipelines beginning to explore overseas markets [2] - The growth of Chinese innovative drugs is attributed to a decade of technological accumulation and a keen understanding of global pharmaceutical industry changes, necessitating a focus on three strategic support points: seizing innovation leadership, building industry moats, and establishing global influence [2] - Chinese pharmaceutical companies are encouraged to focus on core capabilities in innovation while balancing the need for external licensing opportunities and long-term commitment to R&D [3]

Group 1 - The company signed an exclusive agreement with Pfizer for the global development, production, and commercialization rights of its PD-1/VEGF bispecific antibody SSGJ-707, excluding mainland China, with an upfront payment of $1.25 billion and potential milestone payments of up to $4.8 billion [1] - The agreement also includes a tiered sales revenue sharing based on product sales in the licensed regions, and Pfizer will purchase $100 million worth of common stock in the company upon the agreement's effective date [1] - The company maintains its profit forecast, expecting net profits of 2.328 billion, 2.612 billion, and 2.938 billion yuan for 2025-2027, with corresponding EPS of 0.97, 1.09, and 1.23 yuan per share, resulting in a current PE of 9.3, 8.3, and 7.4 times [1] Group 2 - SSGJ-707 has shown excellent ORR and DCR in the treatment of NSCLC patients, indicating its best-in-class potential, and has received breakthrough therapy designation from the National Medical Products Administration for first-line treatment of PD-L1 positive locally advanced or metastatic NSCLC [2] - The company is advancing clinical research for SSGJ-707 in other areas, including colorectal cancer and gynecological tumors, and has received FDA IND approval [2] - The company’s existing products, such as Tebentafusp, are expected to see growth due to successful negotiations for zero price reduction in 2024 and the addition of new indications, contributing to cash flow [2]

Core Viewpoint - The collaboration between 3SBio and Pfizer for SSGJ-707 marks a significant milestone in the Chinese biopharmaceutical industry, with a total upfront payment of $1.25 billion and potential milestone payments reaching up to $4.8 billion, indicating strong market confidence in the drug's potential [1][2]. Group 1: Licensing Agreement and Financial Implications - 3SBio has granted Pfizer global development, production, and commercialization rights for SSGJ-707 outside of mainland China while retaining rights for mainland China and granting Pfizer commercialization options [1]. - The agreement includes a non-refundable upfront payment of $1.25 billion and potential milestone payments of up to $4.8 billion based on development, regulatory approvals, and sales [1]. - Additionally, 3SBio will receive a tiered sales royalty based on product sales in the licensed regions [1]. Group 2: Clinical Development and Pipeline - SSGJ-707 has shown significant anti-tumor activity and good safety in Phase II clinical trials, positioning it as a potential best-in-class therapy [2]. - The drug is currently undergoing four Phase II clinical studies in China, targeting various cancers including PD-L1 positive non-small cell lung cancer (NSCLC) and advanced gynecological tumors [2]. - Future catalysts for SSGJ-707 include Pfizer's overseas clinical progress, advancements in domestic Phase III trials, and data releases from major conferences like ASCO [2]. Group 3: Existing Product Portfolio and Growth Potential - 3SBio's existing core products are mature and leading in their respective segments, with expected stable growth [2]. - Key products include Terbinafine, which is the company's top-selling product, and Erythropoietin, which has new indications covered by insurance, opening up significant market potential [2]. - The company is also focusing on oral paclitaxel and other promising candidates in its pipeline, indicating a robust growth strategy [3]. Group 4: Financial Forecast and Market Valuation - The projected peak sales for SSGJ-707 are estimated at $8.5 billion, with a 10% sales royalty contributing to a market value of approximately 35 billion [4]. - The domestic peak sales are estimated at $5 billion, contributing an additional 15 billion in market value [4]. - The total target market capitalization is around 80 billion, with significant adjustments to net profit forecasts for 2025-2027, reflecting strong growth expectations [4].

Group 1 - The core point of the article is the licensing agreement between 3SBio and Pfizer for the development and commercialization of SSGJ-707, a bispecific antibody targeting PD-1 and VEGF, with an upfront payment of $1.25 billion and potential milestone payments of up to $4.8 billion [1][2] - SSGJ-707 has shown promising clinical results in non-small cell lung cancer (NSCLC) with high objective response rates (ORR) and disease control rates (DCR), indicating its best-in-class potential [2] - The drug has received breakthrough therapy designation from the National Medical Products Administration (NMPA) in China and IND approval from the FDA, with ongoing clinical studies for other cancers [2] Group 2 - The company expects steady growth in its core products, including Tezspire and Mandi, in 2024, along with expansion in indications and formulations [3] - The company has established four new collaborations in 2024, enhancing its commercial footprint and product portfolio [3] - Revenue forecasts for the company have been adjusted upwards, with projected total revenues of 18.244 billion, 12.752 billion, and 14.731 billion yuan for 2025-2027, and corresponding net profits of 8.575 billion, 3.413 billion, and 4.102 billion yuan [3]

Group 1 - The company signed a licensing agreement with Pfizer for the PD1×VEGF dual antibody SSGJ707, granting Pfizer global rights (excluding mainland China) for development, production, and commercialization, with an upfront payment of $1.25 billion and potential milestone payments of $4.8 billion [1] - The $1.25 billion upfront payment sets a record for Chinese innovative drug licensing out, indicating strong market validation for the PD1×VEGF dual antibody sector [1] - The clinical development speed of SSGJ707 in the U.S. is expected to be rapid due to Pfizer's robust clinical development platform and commercialization system [1] Group 2 - The company has four mid-to-late stage clinical assets (IL17, IL1β, IL4R, IL5 monoclonal antibodies), each projected to generate over $1 billion in revenue, with IL17 expected to commercialize in 2025 [2] - The company forecasts revenue growth from 2025 to 2027, estimating revenues of 10.201 billion, 11.494 billion, and 13.153 billion yuan, with year-on-year growth rates of 12.0%, 12.7%, and 14.4% respectively [2] - The company anticipates net profit growth during the same period, projecting net profits of 2.345 billion, 2.648 billion, and 3.027 billion yuan, with growth rates of 12.2%, 12.9%, and 14.3% respectively [2]

Investment Rating - The investment rating for the company is "Buy" (maintained) [2][9] Core Views - The company has signed a licensing agreement with Pfizer for the PD1×VEGF dual antibody SSGJ707, receiving an upfront payment of $1.25 billion, which is the largest for a Chinese innovative drug license-out, along with potential milestone payments of $4.8 billion and double-digit royalties on net sales [4][6] - The company is expected to achieve revenue growth of 12% to 14% from 2025 to 2027, with projected revenues of 102.01 billion, 114.94 billion, and 131.53 billion yuan respectively [6] - The net profit forecast for the same period is 23.45 billion, 26.48 billion, and 30.27 billion yuan, reflecting a growth rate of 12.2% to 14.3% [6] Summary by Sections Financial Performance - The company is projected to have operating revenues of 7,836 million yuan in 2023, increasing to 10,201 million yuan in 2025, with a year-on-year growth rate of 14% in 2023 and 12% in 2025 [2] - The net profit attributable to the parent company is expected to rise from 1,549 million yuan in 2023 to 2,345 million yuan in 2025, with a significant increase of 35% in 2024 [2] - Earnings per share (EPS) is forecasted to grow from 0.65 yuan in 2023 to 0.98 yuan in 2025 [2] Market Position and Prospects - The PD1×VEGF dual antibody market is expected to grow significantly, with SSGJ707 showing promising clinical data and a strong partnership with Pfizer, which enhances the clinical development speed in the U.S. [6] - The company has a robust pipeline with four mid-to-late stage monoclonal antibodies, including IL17, which is expected to be commercialized in 2025, indicating a strong potential for revenue generation [6] Valuation Metrics - The price-to-earnings (P/E) ratio is projected to decrease from 28.5 in 2023 to 18.9 in 2025, indicating an improving valuation as earnings grow [2] - The price-to-book (P/B) ratio is expected to decline from 3.2 in 2023 to 2.4 in 2025, reflecting a more attractive valuation over time [2]

5月23日恒生指数上涨0.24%，南向资金全天合计成交金额为963.65亿港元，其中，买入成交476.13亿港 元，卖出成交487.52亿港元，合计净卖出金额11.39亿港元。具体来看，港股通（深）累计成交金额 352.18亿港元，买入成交161.92亿港元，卖出成交190.25亿港元，合计净卖出金额28.33亿港元；港股通 （沪）累计成交金额611.47亿港元，买入成交314.21亿港元，卖出成交297.27亿港元，合计净买入金额 16.94亿港元。 成交活跃股方面，今日上榜个股中，南向资金成交金额最多的是小米集团-W，合计成交额58.61亿港 元，腾讯控股、阿里巴巴-W成交额紧随其后，分别成交41.27亿港元、38.56亿港元。以净买卖金额统 计，净买入的个股共有8只，美团-W净买入额为8.42亿港元，净买入金额居首，该股收盘股价上涨 0.66%，建设银行净买入额为6.23亿港元，信达生物净买入额为4.12亿港元。净卖出金额最多的是盈富 基金，净卖出23.24亿港元，该股收盘股价上涨0.25%，腾讯控股、小米集团-W遭净卖出15.65亿港元、 6.53亿港元。 今日上榜个股中，美团-W、信达生物、阿里巴巴 ...

Investment Rating - The report maintains an "Overweight" rating for the overseas pharmaceutical industry, indicating a positive outlook for the sector [3][6]. Core Insights - A significant collaboration has been established between Sanofi and Pfizer regarding SSGJ-707 (PD-1/VEGF dual antibody), with an upfront payment exceeding $1.25 billion and potential total payments reaching $4.8 billion, including milestone payments and a double-digit percentage sales share [3][7]. - The Hang Seng Healthcare Index increased by 6.83%, outperforming the Hang Seng Index by 6.44 percentage points [6]. Summary by Sections 1. Overseas Pharmaceuticals - Sanofi and Pfizer's collaboration on SSGJ-707 includes global development rights, with Sanofi receiving an upfront payment of $1.25 billion and potential total payments of up to $4.8 billion [3][7]. - Kelun Biotech's TROP2 ADC has received acceptance for a new indication application, targeting HR+ HER2- breast cancer patients [3][7]. - Innovent Biologics' CD19 monoclonal antibody has been approved for the treatment of relapsed/refractory diffuse large B-cell lymphoma in China [3][7]. - The report highlights the approval of BMS's TYK2 inhibitor for a new indication and a collaboration between Roche and Orionis for small molecule drugs [4][8]. 2. Overseas Social Services - Ctrip's Q1 2025 revenue increased by 16% to 13.9 billion yuan, with a non-GAAP operating profit of 4 billion yuan, maintaining a profit margin of 29% [12]. - The report maintains a target price of 590 HKD for Ctrip, with a "Buy" rating [12]. 3. Overseas Education - The education index rose by 1.4%, outperforming the Hang Seng National Enterprises Index by 0.7 percentage points [16]. - The report suggests focusing on vocational education companies, particularly China Oriental Education, due to a rebound in training demand [18].