Core Viewpoint - The Hong Kong innovative drug sector has achieved a 78% increase as of June 6, 2025, marking the highest half-year growth since 2018, driven by multiple factors including domestic drug approvals and supportive national policies [1][2]. Group 1: 1H25 Review - As of June 6, 2025, the MSCI China Pharmaceutical Index and the Hang Seng Biotechnology Index have risen by 31% and 48% respectively, significantly outperforming the MSCI China Index (up 16%) and the Hang Seng Index (up 19%) [2]. - The innovative drug sector has seen the best performance with a 62% increase, while the pharmaceutical distribution sector has declined by 8% [2]. - The outperformance of the pharmaceutical sector is attributed to its immunity to the "tariff war," continuous improvement in fundamentals, and historically low valuations attracting new capital [2]. Group 2: 2H25 Outlook - The pharmaceutical sector's fundamentals are expected to improve further in 2H25 due to anticipated overseas licensing of domestic innovative drugs, supportive national policies, and rapid growth in innovative drug sales [3]. - The innovative drug sector is recommended as a top choice, particularly companies with strong R&D capabilities and significant commercial potential, such as Innovent Biologics (01801) and BeiGene (06160) [3]. - Innovent Biologics is positioned well with upcoming approvals for key drugs, while BeiGene has multiple catalysts expected in the second half of the year [3]. Group 3: Other Sectors - The medical device sector is expected to benefit from policy-driven demand for high-value consumables and equipment upgrades, with companies like Aikang Medical (01789) and Mindray Medical (300760.SZ) recommended for attention [4]. - The CXO sector shows signs of recovery in new order growth, with companies like WuXi AppTec (02269) and WuXi Biologics (02359) highlighted for their growth potential [4]. - The medical services sector is viewed positively, particularly in traditional Chinese medicine and ophthalmology services [5].

Core Viewpoint - The Hong Kong pharmaceutical sector is experiencing positive momentum, driven by significant developments in innovative drug approvals and collaborations, particularly highlighted during the recent ASCO annual meeting and the announcement of potential licensing deals by major companies [1][2]. Group 1: Market Performance - As of June 13, 2025, the CSI Hong Kong Pharmaceutical and Health Comprehensive Index (930965) saw notable increases in key stocks, including WuXi Biologics (02269) up by 5.41%, and Innovent Biologics (01801) up by 3.53% [1]. - The Hong Kong Medical ETF (513700) rose by 1.28%, with a cumulative increase of 12.57% over the past week as of June 12, 2025 [1][2]. Group 2: Industry Developments - On June 12, 2025, China Biopharmaceutical announced at the 46th Goldman Sachs Global Healthcare Conference in Miami that it has received multiple collaboration intentions for its products, indicating a significant upcoming licensing deal [1]. - The ASCO annual meeting showcased the competitiveness and innovation of Chinese pharmaceutical companies, with several impressive results and data presentations [2]. Group 3: ETF and Index Information - The Hong Kong Medical ETF (513700) effectively tracks the CSI Hong Kong Pharmaceutical and Health Comprehensive Index, which includes 50 liquid and large-cap healthcare companies to reflect the overall performance of the sector [2]. - The top ten weighted stocks in the CSI Hong Kong Pharmaceutical and Health Comprehensive Index as of May 30, 2025, include companies like BeiGene (06160) and WuXi Biologics (02269), collectively accounting for 60.77% of the index [3].

Core Viewpoint - Innovent Biologics is set to present multiple clinical study results of mazdutide at the American Diabetes Association's 85th Scientific Sessions, highlighting its potential as a next-generation treatment for Type 2 Diabetes (T2D) and other metabolic diseases [1] Group 1: Clinical Studies and Presentations - The first Phase 3 study of mazdutide in Chinese adults with T2D (DREAMS-1) will be presented orally [1] - Multiple exploratory mechanism of action (MoA) analyses of mazdutide and a preclinical study of IBI3030 will be showcased in poster presentations [1] - The presentations include various studies on mazdutide's effects on liver fat accumulation, hyperuricemia, and cardiovascular risk markers [1][1][1] Group 2: Product Development and Regulatory Status - Mazdutide is currently under review with two New Drug Applications (NDAs) accepted by the National Medical Products Administration (NMPA) [4] - The drug is being evaluated in six Phase 3 clinical studies, with GLORY-1, DREAMS-1, and DREAMS-2 having met their primary endpoints [4] - Innovent has plans for several new clinical studies involving mazdutide, targeting conditions such as metabolic dysfunction-associated steatohepatitis (MASH) and heart failure with preserved ejection fraction (HFpEF) [7] Group 3: Company Overview and Partnerships - Innovent Biologics, founded in 2011, focuses on developing high-quality biopharmaceuticals for various diseases, including oncology and metabolic disorders [4] - The company has launched 15 products and has 3 new drug applications under regulatory review, with 4 assets in Phase III trials and 15 molecules in early clinical stages [4] - Innovent collaborates with over 30 global healthcare companies, including Eli Lilly, to enhance its product offerings and market reach [4]

Core Viewpoint - The article highlights the growing recognition and success of Chinese biotech companies in the global market, particularly through the development of proprietary technologies and platforms, exemplified by the recent patent authorization of the RenMab® platform by BaiOsaite [1][2][4]. Group 1: Technological Advancements - BaiOsaite's RenMab® platform received a patent from the Japan Patent Office, marking a significant achievement in China's biotech innovation [1]. - The platform utilizes a proprietary technology called SUPCE® to humanize mouse antibody variable region genes, addressing key challenges in antibody drug development [2]. - The platform has gained international attention, with collaborations established with major companies like Merck and Johnson & Johnson, resulting in a large-scale antibody discovery project targeting over 1,000 potential drug targets [4]. Group 2: Market Trends and Collaborations - In 2024, over 94 license-out transactions for Chinese innovative drugs were recorded, with 41 occurring in the first quarter of 2025, totaling over $36.9 billion in transaction value [6]. - Notable deals include IBI3009's global licensing agreement with Roche, which includes an upfront payment of $80 million and potential milestone payments up to $1 billion [5]. - The focus on PD-1/VEGF bispecific antibodies has attracted significant international interest, with major agreements involving Pfizer and Merck [6]. Group 3: Intellectual Property and Global Strategy - Chinese biotech companies are shifting their focus from merely exporting products to also exporting platforms and intellectual property, recognizing the higher commercial potential in original technologies [7][8]. - Companies like BaiOsaite and Innovent Biologics are demonstrating systematic capabilities in intellectual property layout, enhancing their negotiating power in international collaborations [8]. - The future of competition in biomedicine will hinge on establishing ecosystems and standards, with a focus on building technological barriers and deep collaborations with upstream and downstream partners [9][10].

Market Overview - On June 12, the Hang Seng Index fell by 1.36%, closing at 24,035.38 points, while southbound funds through the Stock Connect recorded a net purchase of HKD 5.585 billion [1] - The total trading volume for the Stock Connect on June 12 was HKD 129.736 billion, with a net purchase of HKD 5.585 billion [1] Stock Performance - In the Shanghai Stock Connect, the total trading volume was HKD 82.940 billion, with a net purchase of HKD 3.851 billion; in the Shenzhen Stock Connect, the trading volume was HKD 46.796 billion, with a net purchase of HKD 1.733 billion [1] - The most actively traded stock in the Shanghai Stock Connect was Alibaba-W, with a trading volume of HKD 4.189 billion, followed by Pop Mart and Xiaomi Group-W, with trading volumes of HKD 4.061 billion and HKD 3.929 billion, respectively [1] - In terms of net buying, Xpeng Motors-W led with a net purchase of HKD 594 million, despite its closing price dropping by 6.66% [1] - Alibaba-W had the highest net selling amount at HKD 1.180 billion, with a closing price decrease of 3.21% [1] Shenzhen Stock Connect Highlights - In the Shenzhen Stock Connect, Pop Mart had the highest trading volume at HKD 226.324 million, followed by Xiaomi Group-W and Alibaba-W with trading volumes of HKD 192.103 million and HKD 178.887 million, respectively [2] - The stock with the highest net purchase was Innovent Biologics, with a net purchase of HKD 437 million, and it closed up by 1.00% [2] - Kuaishou-W had the highest net selling amount at HKD 750 million, with a closing price drop of 5.87% [2]

Summary of Key Points Core Viewpoint - On June 12, the Hang Seng Index fell by 1.36%, with southbound capital totaling HKD 129.736 billion in trading volume, resulting in a net inflow of HKD 5.585 billion [1][2]. Trading Activity - Southbound trading included a total buy transaction of HKD 67.660 billion and a sell transaction of HKD 62.076 billion, leading to a net buy of HKD 5.585 billion [1]. - The cumulative trading volume for the Stock Connect (Shenzhen) was HKD 46.796 billion, with a net buy of HKD 1.733 billion, while the Stock Connect (Shanghai) had a trading volume of HKD 82.940 billion and a net buy of HKD 3.851 billion [1]. Active Stocks - The most actively traded stock by southbound capital was Pop Mart, with a total trading volume of HKD 63.240 billion, followed by Alibaba-W and Xiaomi Group-W with trading volumes of HKD 59.780 billion and HKD 58.500 billion, respectively [1][2]. - The net buying stocks included eight companies, with Xpeng Motors-W leading at a net buy of HKD 7.670 billion despite a closing price drop of 6.66% [1][2]. - Other notable net buys were for Innovent Biologics at HKD 4.370 billion and China Construction Bank at HKD 3.980 billion [1][2]. Net Selling Activity - Alibaba-W experienced the highest net sell amount at HKD 16.400 billion, with a closing price decline of 3.21%. Tencent Holdings and Kuaishou-W followed with net sells of HKD 8.320 billion and HKD 8.170 billion, respectively [1][2]. - Continuous net buying was observed for Innovent Biologics over four days, totaling HKD 22.980 billion, while Tencent Holdings, Alibaba-W, and Kuaishou-W faced continuous net selling [2].

Group 1 - The pharmaceutical sector in China is experiencing a resurgence after over three years of stagnation, driven by overseas business and innovative drug companies turning profitable [1] - In 2024, the total transaction value of Chinese innovative drugs going abroad is projected to reach $50.8 billion, marking a year-on-year increase of over 30% [1] - The National Medical Products Administration reported that 48 new Class 1 innovative drugs were approved for market in 2024, a 20% increase year-on-year, achieving a five-year high [1] Group 2 - Major companies are reporting strong financial results, with BeiGene's Q1 revenue reaching 8.048 billion yuan, a 50.2% year-on-year increase, marking its first quarterly profit [1] - WuXi AppTec, a leading CXO company, reported Q1 revenue of 9.65 billion yuan, a 21.0% increase year-on-year, with net profit attributable to shareholders at 3.67 billion yuan, up 89.1% [1] Group 3 - The innovative drug-related indices have seen significant increases, with leading indices reflecting strong performance from innovative drug companies [1] - The top ten constituent stocks of the National and China Securities innovative drug indices show a high similarity, indicating a strong leader effect [2] Group 4 - The leading constituent stock, Innovent Biologics, reported Q1 product sales exceeding 2.4 billion yuan, a year-on-year increase of over 40%, achieving a record high for a single quarter [3] - BeiGene's stock has increased by 45.51% this year, while WuXi Biologics has seen a 51.77% increase [4] Group 5 - There are currently three ETFs tracking the National innovative drug index, with the largest being the Huatai-PineBridge ETF, which has a scale of 4.474 billion yuan [4] - The two ETFs tracking the China Securities innovative drug index are smaller in scale compared to those tracking the National index [5] Group 6 - The Hang Seng innovative drug index and the Hang Seng Hong Kong Stock Connect innovative drug index have similar constituent stocks, with significant overlap in their top ten holdings [6] - The Hang Seng Hong Kong Stock Connect healthcare index has a more concentrated composition, leading to more pronounced gains during market upswings [9] Group 7 - The average growth rate for innovative drug revenues is projected at 36.8% for 2024, with many companies reducing losses significantly and some achieving profitability [12] - The current valuation of innovative drug companies is considered reasonable after three years of adjustments, with the industry entering a growth cycle [12]

| 公司名称 | 成交金额 | 净买入额 | | --- | --- | --- | | 阿里巴巴-W(09988) | 41.89 亿元 | -11.80 亿元 | | 泡泡玛特(09992) | 40.61 亿元 | -5804.06 万元 | | 小米集团-W(01810) | 39.29 亿元 | +1.53 亿元 | | 建设银行(00939) | 20.81 亿元 | +3.98 亿元 | | 美团-W(03690) | 20.70 亿元 | -2.96 亿元 | | 快手-W(01024) | 16.87 亿元 | -6675.04 万元 | | 腾讯控股(00700) | 16.32 亿元 | -1.39 亿元 | | 小鹏汽车-W(09868) | 16.00 亿元 | +5.94 亿元 | | 中国银行(03988) | 15.35 亿元 | +1.39 亿元 | | 中国海洋石油(00883) | 15.25 亿元 | -3.91 亿元 | 深港通（南向）十大活跃成交公司 | 公司名称 | 成交金额 | 净买入额 | | --- | --- | --- | | 泡泡玛特(09992) | ...

Core Viewpoint - The report from浦银国际 indicates that信达生物 (01801) has promising potential for international licensing of IBI363 and IBI343, particularly highlighting IBI363 as a potential solution for PD-1 resistance [1] Financial Projections - The projected net profit for the company is estimated to be 4.3 billion, 8.5 billion, and 18.9 billion for the years 2025, 2026, and 2027 respectively [1] - The target price has been raised to 95 HKD based on a DCF valuation model with an 8.5% WACC and a 3% perpetual growth rate [1] Clinical Data Insights - IBI363's mPFS in the 3mg/kg dose group for IO-treated sq-NSCLC has improved to 9.3 months, enhancing confidence in its development for lung squamous carcinoma [2] - In the same context, the 3mg/kg dose group showed better efficacy data compared to the ≤1.5mg/kg group, with higher cORR and longer mPFS [2] - IBI363 in combination with Bevacizumab showed a 15.1% cORR and a 4.7-month mPFS, with a notable 31.3% cORR and 7.4-month mPFS in the population without liver metastasis [3] - The single-agent mOS for IBI363 was reported at 16.1 months, with significant improvements in the mOS for both liver metastasis and non-liver metastasis groups [3] - For IBI343 in pancreatic cancer, the mOS has increased from 8.5 months to 9.1 months, while the mPFS remains consistent at 5.4 months [5] Additional Clinical Findings - IBI363 at a 1mg/kg Q2W dosage showed an mPFS of 5.7 months and an mOS of 14.8 months, significantly higher than real-world data for second-line therapies [4]

Core Viewpoint - The company has presented additional follow-up data for IBI363 and IBI343 at the ASCO conference, showing promising results that enhance confidence in their development, leading to an upward revision of the target price to HKD 95 and a reaffirmation of the "buy" recommendation [1][5]. Group 1: IBI363 Data Insights - The mPFS for the IBI363 3mg/kg dose group in IO-treated sq-NSCLC has been extended to 9.3 months, an improvement from the previously reported 7.3 months, indicating strong efficacy [2][3]. - In the EGFR wild-type adenocarcinoma (EGFRwt Ad-NSCLC), the mPFS remains consistent at 4.2 months, outperforming docetaxel's mPFS of 2.5-4 months [2]. - The company plans to initiate a Phase III registration clinical trial for IBI363 in 3L+ sq-NSCLC, with the 3mg/kg dose expected to be used [2]. Group 2: IBI343 and Other Data - IBI363 combined with bevacizumab shows a 15.1% cORR and a 4.7-month mPFS, with a notable 31.3% cORR and 7.4-month mPFS in the population without liver metastasis [3]. - The overall mOS for IBI363 monotherapy is reported at 16.1 months, with subgroup analysis showing mOS of 14.4 months for liver metastasis patients and 17.0 months for those without, both significantly higher than the 9.3 months for fruquintinib in 3L CRC [3]. - In melanoma, the IBI363 1mg/kg Q2W dose group shows mPFS of 5.7 months and mOS of 14.8 months, significantly better than real-world data [4]. Group 3: Financial Projections - The company forecasts peak sales of approximately HKD 2.5 billion for IBI363 and HKD 1.5 billion for IBI343 in China, adjusted for risk [5]. - Projected net profits for the company are estimated at HKD 430 million, HKD 850 million, and HKD 1.89 billion for the years 2025, 2026, and 2027, respectively [5].