Core Viewpoint - The Chinese innovative pharmaceutical sector is gaining international recognition, highlighted by significant deals and promising clinical data, leading to increased interest in related ETFs [1][3][4]. Group 1: Market Performance - The innovative drug ETF (517110) has rebounded nearly 15% since early April, reflecting strong performance in the pharmaceutical sector [1]. - The biopharmaceutical ETF and vaccine ETF also showed positive movements, with respective increases of 1.17% and 0.89% [2]. Group 2: ASCO Conference Insights - At the 2025 ASCO conference, over 70 research outcomes from Chinese pharmaceutical companies were presented, showcasing advancements in ADC and bispecific antibody technologies [3]. - Notable performances include Zai Lab's ZG005 and Huahai Pharmaceutical's HB0025, which exceeded expectations in early clinical trials for cervical and endometrial cancers, respectively [3]. Group 3: Business Development Trends - Recent business development (BD) activities in the innovative drug sector have seen record-breaking upfront payments, such as the $12.5 billion upfront payment from Pfizer for a PD-1/VEGF bispecific antibody from 3SBio [4][7]. - The increase in upfront payments and total deal values indicates growing international recognition of Chinese innovative drugs [7]. Group 4: Future Outlook - The innovative drug sector is expected to benefit from ongoing BD transactions, advancements in artificial intelligence across the pharmaceutical value chain, and the implementation of new healthcare policies [7]. - The overall sentiment and valuation in the pharmaceutical sector may improve due to domestic policy optimizations and a recovery in medical equipment procurement [7].

Group 1 - The core viewpoint is that China's innovative drug BD (business development) transactions are experiencing significant growth in both volume and quality since 2024, with notable increases in upfront payments and total package amounts, indicating international recognition of Chinese innovative drugs [1] - At the 2025 AACR conference, 126 companies showcased nearly 300 research results, with the number of Chinese companies and displayed results reaching historical highs, reflecting international academic recognition of domestic innovative drugs [1] - Despite ongoing US-China tariff frictions since April, multiple BD transactions for drugs have still been completed, demonstrating the strong momentum of innovative drugs going abroad [1] Group 2 - The innovative drug ETF (517110) tracks the SHS Innovative Drug (RMB) Index (931409), which is compiled by China Securities Index Co., Ltd., selecting listed companies involved in the research, production, and sales of innovative drugs from the A-share market [2] - The index aims to reflect the overall performance of innovative drug-related companies in the A-share market, with constituent stocks characterized by significant R&D investment and growth potential [2] - The innovative drug sector is expected to benefit from outbound transactions, AI empowerment across the pharmaceutical industry, and the implementation of innovative drug category B medical insurance, leading to potential increases in profitability and valuation [1]