Core Viewpoint - The innovative drug sector has shown strong performance in the first half of the year, driven by successful collaborations, excellent clinical data, and supportive policies, despite recent declines in various indices related to the sector [1]. Group 1: Market Performance - The Hang Seng Hong Kong Stock Connect Innovative Drug Index fell by 4.4% [1] - The CSI Innovative Drug Industry Index decreased by 4.2% [1] - The CSI Biotechnology Theme Index dropped by 4.1% [1] - The CSI Pharmaceutical and Health Comprehensive Index declined by 4% [1] - The CSI Hong Kong Stock Connect Pharmaceutical and Health Comprehensive Index fell by 3.9% [1] - The Everbright Innovative Drug ETF (159316) saw a net subscription of 116 million shares today [1] Group 2: Sector Insights - The innovative drug sector is expected to rapidly realize commercial value for newly launched products due to national policies encouraging innovation [1] - The proportion of domestic innovative drugs in hospital products is anticipated to increase quickly, positioning it as one of the best growth segments [1]

Group 1 - The core viewpoint of the news highlights the strong performance of the innovative drug sector in the first half of the year, driven by successful collaborations, excellent clinical data, and supportive policies [1] - The China Securities report indicates that the innovative drug sector is expected to see a rapid increase in the commercial value of newly launched products due to national policies encouraging innovation [1] - The proportion of domestic innovative drugs in hospital products is anticipated to rise quickly, positioning this sector as one of the best growth segments [1] Group 2 - The index focuses on leading innovative drug companies in the A-share market, consisting of no more than 50 stocks involved in innovative drug research and development [4] - The index has shown a rolling price-to-earnings ratio of 59.2 times and an increase of 91.3% since its inception [5] - The biotechnology ETF tracks the China Biotechnology Theme Index, which includes up to 50 stocks related to gene diagnostics, biopharmaceuticals, and other human biotechnology [6] Group 3 - The healthcare ETF tracks the CSI 300 Healthcare Index, covering leading companies in the healthcare sector, including chemical pharmaceuticals, medical services, and medical devices [8] - The CSI 300 Healthcare Index has a rolling price-to-earnings ratio of 33.9 times and has increased by 65.7% since its inception [9]

Core Viewpoint - The Hong Kong innovative drug sector is showing resilience, with the Hang Seng Innovative Drug Index rising by 1.6% and significant trading activity in the Hang Seng Innovative Drug ETF, indicating strong investor interest and growth potential in this segment [1] Industry Performance - The innovative drug companies in Hong Kong reported rapid revenue growth in the first half of the year, with BeiGene achieving revenue of 17.52 billion, a year-on-year increase of 46.0%; Innovent Biologics reaching 6.19 billion, up 45.6%; and CanSino Biologics reporting 1.41 billion, a growth of 32.6% [1] - The performance of the innovative drug sector is driven by successful overseas collaborations, positive clinical data releases, and supportive policies, positioning it as a high-growth segment within the market [1] Market Dynamics - The recent adjustment of the Hang Seng Innovative Drug Index, which now excludes contract research organizations (CROs), enhances its purity and accuracy in reflecting the performance of innovative drug companies in China [1] - The Hang Seng Innovative Drug ETF is currently the only product tracking this adjusted index, providing investors with a targeted opportunity to capitalize on the growth of the innovative drug industry [1]