Summary of CDMO Industry Analysis and Outlook (2025 H1) Industry Overview - The CDMO (Contract Development and Manufacturing Organization) industry demonstrated strong performance in the first half of 2025, achieving double-digit revenue growth and over 50% year-on-year net profit increase, with non-GAAP net profit growth nearing 30% driven by accelerated orders, increased demand for innovative drugs, and enhanced international influence [1][3][11]. Key Insights - **Performance Comparison**: CDMO outperformed CRO (Contract Research Organization) in terms of order resilience and fulfillment rates. While CRO faced challenges, it is expected to improve in the second half of the year as price competition eases and new orders emerge [1][4]. - **Order Concentration**: Orders are increasingly concentrated among leading companies such as WuXi AppTec, Hualan Biological Engineering, and Kelun Pharmaceutical [1][4]. - **Valuation Trends**: The pharmaceutical sector's valuation is currently at a historical low following geopolitical pressures in 2024, indicating potential for upward elasticity. Leading companies like WuXi AppTec and TaiGen Biotechnology have seen significant order growth, with WuXi's orders up 37% and TaiGen's nearly 150% [1][5]. - **Investment Climate**: Global investment and financing remained stable in the first seven months of 2025 compared to the previous year, with a 20% increase in July. Domestic investment is recovering, supported by new listing standards for innovative drug companies [1][6][7]. Market Dynamics - **Clinical Trials**: The proportion of clinical trials conducted by Chinese innovative drug companies has risen from under 10% in 2016 to approximately 28% in 2023, with oncology drugs increasing from 15% to 35.5%, indicating China's growing position in the global pharmaceutical supply chain [1][8]. - **Future Projections**: Goldman Sachs projects that by around 2030, Chinese innovative drugs could account for 30% of FDA approvals, suggesting significant commercial transformation and global influence [1][8]. Company-Specific Performance - **WuXi AppTec**: In the first half of 2025, WuXi AppTec's revenue grew by 20%, with a non-GAAP growth of 26%. The company reported a 37% increase in orders, driven by strong demand, and plans to allocate 70%-80% of capital expenditures to expansion in the U.S., Switzerland, and Singapore [1][11]. - **Kelun Pharmaceutical**: Kelun's revenue increased by 15% in the first half of 2025, with adjusted net profit growth nearing 10%. The company is showing strong resilience and capacity expansion [1][12]. Conclusion and Outlook - The CDMO sector is expected to continue its upward trajectory, with leading companies likely to maintain double-digit order and revenue growth. Emerging businesses such as TaiGen and CGT are also contributing to new growth. The confidence in performance resilience and certainty is bolstered by the easing of geopolitical risks, and overseas capacity will play a more significant role in future CRO performance [1][13].

Market Performance - The pharmaceutical sector experienced a slight increase of +0.04% on September 15, 2025, underperforming the CSI 300 index by 0.20 percentage points, ranking 14th among 31 sub-industries in the Shenwan classification [1] - Among sub-industries, medical research outsourcing (+2.54%) and medical devices (+0.48%) performed well, while vaccines (-0.91%), medical consumables (-0.72%), and blood products (-0.51%) lagged behind [1] - Top three gainers in individual stocks were Furuide (+20.01%), Dezhan Health (+10.02%), and Zhaoyan New Drug (+10.01%), while the biggest losers were Nuocheng Jianhua (-8.20%), Yinkang Life (-5.21%), and Xinnuo Wei (-5.11%) [1] Industry News - Johnson & Johnson has submitted an application to the European Medicines Agency (EMA) for the oral peptide therapy Icotrokinra (JNJ-2113), developed in collaboration with Protagonist, aimed at treating moderate to severe plaque psoriasis in patients aged 12 and older [2] - The ICONIC-LEAD pivotal Phase 3 study reported positive topline results, indicating that Icotrokinra significantly improved skin conditions in patients with moderate to severe plaque psoriasis and demonstrated good safety [2] Company News - Kanglong Chemical announced that its subsidiary, Kanglong Shaoxing, successfully passed the FDA's on-site quality inspection, marking the first time its Shaoxing active pharmaceutical ingredient production facility has passed the FDA's pre-approval inspection [3] - Haisco received a Class 1 innovative drug registration certificate from the National Medical Products Administration for Anruikefen injection, which has been approved for an additional indication to treat moderate to severe itching in adult patients with chronic kidney disease related to maintenance hemodialysis [3] - Yipinhong's subsidiary in Guangzhou received a drug registration certificate for Clindamycin Palmitate Granules, confirming compliance with registration requirements [3] - Shanghai Laishi announced that its controlling shareholder, Haiyingkang, has cumulatively increased its shareholding by 72,935,300 shares, representing 1.10% of the total share capital, with a total investment of approximately RMB 499.99 million from May 22, 2025, to September 15, 2025 [3]

Core Viewpoint - 康龙化成's stock rose over 7% following the announcement of successful FDA inspection of its Shaoxing facility, marking a significant milestone in its compliance with international quality standards [1] Group 1: Company Achievements - 康龙化成's Shaoxing facility received the Establishment Inspection Report from the FDA, confirming it passed the quality inspection [1] - This is the first time the Shaoxing active pharmaceutical ingredient (API) production base has passed the FDA's pre-approval inspection for new drugs [1] - Following the successful inspection of the Ningbo facility in April 2025, this marks another achievement for 康龙化成 in ensuring its production facilities meet FDA standards [1] Group 2: Market Implications - The successful FDA inspection indicates that 康龙化成's quality system is aligned with international standards, enabling it to supply commercialized innovative drug APIs to the US and global markets [1] - Currently, 康龙化成 has four commercialized API production bases in China, the UK, and the US that have all passed FDA inspections, allowing it to provide tailored production solutions for different markets [1]

Core Viewpoint - 康龙化成's subsidiary successfully passed the FDA's cGMP pre-approval inspection, marking a significant milestone in its ability to produce commercialized innovative drug APIs for the US and global markets [1] Group 1: FDA Inspection and Approval - 康龙化成 (300759.SZ) announced that its wholly-owned subsidiary, 康龙化成（绍兴）药业有限公司, underwent an FDA cGMP pre-approval inspection from May 29 to June 4, 2025 [1] - The inspection covered multiple GMP systems, and the facility successfully passed the FDA's on-site quality check, confirming compliance with US drug cGMP quality standards [1] - This marks the first time the Shaoxing API commercial production base has passed the FDA's new drug pre-approval inspection, following the successful inspection of the Ningbo API production facility [1] Group 2: Global Market Readiness - The successful inspection indicates that 康龙化成's quality system is aligned with international standards, enabling the company to continuously supply commercialized innovative drug APIs to the US and global markets [1] - Currently, 康龙化成 has four commercialized API production bases located in China, the UK, and the US, all of which have passed FDA inspections [1]

Core Viewpoint - 康龙化成's stock has experienced significant fluctuations, with a year-to-date increase of 37.69% and a recent 60-day increase of 49.21%, indicating strong market interest and performance [1] Company Overview - 康龙化成 (Beijing Kanglong Chemical Co., Ltd.) was established on July 1, 2004, and went public on January 28, 2019. The company specializes in drug research, development, and production services [1] - The company's revenue composition includes laboratory services (60.43%), CMC (small molecule CDMO) services (21.58%), clinical research services (14.58%), and other services (3.28%) [1] Financial Performance - For the first half of 2025, 康龙化成 reported revenue of 64.41 billion yuan, a year-on-year increase of 14.93%, while net profit attributable to shareholders decreased by 37.00% to 7.01 billion yuan [2] - Since its A-share listing, 康龙化成 has distributed a total of 17.94 billion yuan in dividends, with 10.07 billion yuan distributed over the past three years [3] Shareholder Structure - As of June 30, 2025, 康龙化成 had 87,900 shareholders, an increase of 10.12% from the previous period [2] - The top ten circulating shareholders include 中欧医疗健康混合A (003095) and 香港中央结算有限公司, with notable changes in their holdings [3]

Group 1 - The State Administration of Foreign Exchange allows foreign investors to reinvest foreign exchange profits generated in China, facilitating capital inflow and investment [2] - Nvidia is under further investigation by the State Administration for Market Regulation for violating antitrust laws related to its acquisition of Mellanox Technologies [3] - The Ministry of Commerce opposes the U.S. request for G7 and NATO members to impose tariffs on China based on its imports of Russian oil, labeling it as unilateral bullying and economic coercion [5] Group 2 - The Financial Regulatory Bureau, People's Bank of China, and China Securities Regulatory Commission launched a financial education campaign aimed at enhancing public understanding of financial rights and services [6] - The State Council emphasizes the need for online travel platforms to strengthen personal information protection and ensure compliance with regulations to safeguard consumer rights [8] - The Beijing Market Supervision Administration is investigating the ongoing controversy surrounding the pre-made dishes of the restaurant chain Xibei [9] Group 3 - CATL's sodium-ion battery has become the first in the world to pass the new national standard certification [11] - Longxin Technology has completed the development of its first GPGPU chip, expected to be delivered within the third quarter [13] - Kanglong Chemical's subsidiary has successfully passed an FDA inspection [14] - Shandong Push's application for H-share issuance has been accepted by the China Securities Regulatory Commission [20]

Company Announcements - Junsheng Electronics' subsidiary has recently secured a global automotive intelligence project with a total order value of approximately 15 billion yuan, expected to start mass production in 2027 [1] - Shangluo Electronics plans to acquire 88.79% of Ligon Technology for 700 million yuan, focusing on authorized distribution of storage chips and various IC products [2][3] - Xinda Zheng intends to purchase at least 51% of Jiaxin Liheng Facility Management (Shanghai) Co., Ltd., with the stock currently suspended [1] - Dingtong Technology plans to invest up to 15 million USD to establish a wholly-owned subsidiary in Vietnam for R&D and production of optical module liquid cooling products [1][3] - Kexing Pharmaceutical's shareholders are inquiring about transferring shares at an initial price of 30.88 yuan per share, which is a 28% discount compared to the closing price [4] - Zhongtai Automobile has been ordered to pay 29.5 million yuan plus overdue interest due to a court ruling, which may significantly impact its current or future performance [5] - Shoukai Co., Ltd. has seen a significant increase in shareholder numbers and some institutional shareholders have reduced their holdings [5] Investment and Contracts - Laofengxiang plans to jointly invest in establishing Laofengxiang Precision Materials Company to build a modern refining and testing laboratory [8] - Longci Technology intends to invest 210 million yuan in the second phase of its Vietnam project to localize the supply of permanent magnet ferrite raw materials [9] - Sileck has signed a 230 million yuan investment cooperation agreement for a new energy precision structural components project [10] Shareholding Changes - Jingchen Co. plans to acquire 316 million yuan for 100% of Chip Micro Semiconductor [6] - Beijing Junzheng has seen a reduction of 4.8254 million shares by its shareholder Beijing Yitang Shengxin [5] - Green Harmony's actual controllers have completed a reduction of 2.99% of their shares [7] - Hangke Technology's actual controller plans to transfer 3% of the total share capital [7] Stock Price Movements - Nanfeng Co. has reported that its 3D printing service project has not yet materialized, which may affect its current year's revenue and profit [3] Other Developments - Borui Pharmaceutical's BGM0504 tablets have been approved for clinical trials in overweight/obese adults, with no similar oral formulations approved globally [4] - Southwest Securities' subsidiary will lose its listing status on September 29 due to failure to meet resumption guidelines [20]

公司近期获悉，康龙绍兴已收到美国FDA出具的现场检查报告(Establishment Inspection Report)。该检查 报告确认，康龙绍兴的生产设施顺利通过美国FDA的现场质量检查。根据该检查报告，康龙绍兴符合美 国药品cGMP质量标准，通过了美国FDA认证。这是公司绍兴原料药(API)商业化生产基地首次通过美国 FDA新药批准前检查，也是继2025年4月公司宁波原料药生产车间通过美国FDA现场检查后，公司在中 国的原料药生产车间再次通过美国FDA检查。这标志着公司质量体系已经与国际接轨，具备持续为美国 及全球市场供应商业化创新药原料药(API)的资质。现时，公司位于中、英、美三地的4个原料药商业化 生产基地均已通过美国FDA检查，可以为全球客户提供针对不同市场的创新药原料药商业化生产解决方 案。 公司始终坚持成为值得客户信赖、可靠、负责任的高品质合作伙伴，为客户在全球医药市场取得成功作 出有意义的贡献。本次顺利通过美国FDA现场检查是公司始终坚持严格贯彻执行最高级别的国际质量标 准的成果，亦是对公司质量管理体系有效运行的高度肯定，对公司继续深耕并不断拓展全球创新药 CDMO领域具有积极的深远影响 ...

Core Viewpoint - 康龙化成's subsidiary, 康龙化成(绍兴)药业有限公司, successfully passed the FDA's pre-approval inspection, confirming its compliance with cGMP standards, which enhances its capability to supply commercialized innovative drug APIs globally [1][2]. Group 1 - 康龙化成(绍兴) underwent an FDA cGMP pre-approval inspection from May 29 to June 4, 2025, covering various quality and production systems [1]. - The establishment inspection report confirmed that 康龙化成(绍兴) met the cGMP quality standards set by the FDA, marking the first successful pre-approval inspection for its API production base [2]. - This achievement indicates that 康龙化成's quality systems are aligned with international standards, enabling it to supply commercialized innovative drug APIs to the US and global markets [2]. Group 2 - 康龙化成 aims to be a trusted and responsible high-quality partner in the global pharmaceutical market, contributing meaningfully to clients' success [3]. - The successful FDA inspection reflects the company's commitment to adhering to the highest international quality standards and validates the effective operation of its quality management system [3]. - This milestone is expected to have a positive and far-reaching impact on 康龙化成's continued expansion in the global innovative drug CDMO sector [3].

Core Viewpoint - 康龙化成's wholly-owned subsidiary, 康龙化成（绍兴）药业有限公司, successfully passed the cGMP pre-market inspection by the FDA, confirming compliance with U.S. drug quality standards [1] Group 1: FDA Inspection Details - The inspection took place from May 29 to June 4, 2025, covering various GMP systems including quality management, material management, production management, equipment facilities, packaging and labeling, and laboratory control systems [1] - 康龙绍兴 has received the FDA's on-site inspection report, affirming that its production facilities meet U.S. cGMP quality standards [1] Group 2: Significance of the Approval - This marks the first time 康龙化成's Shaoxing API commercial production base has passed the FDA's pre-approval inspection [1] - This follows the successful FDA inspection of 康龙化成's Ningbo API production workshop in April 2025, indicating a positive trend for the company's API production facilities in China [1]