Core Insights - The article highlights the participation of Gensci Pharmaceutical at the 44th JPMorgan Healthcare Conference, showcasing its innovative drug development and research capabilities, which attracted significant investor interest [1][2]. Group 1: Innovative Drug Pipeline - Gensci Pharmaceutical presented seven innovative drug pipelines targeting major disease areas such as oncology, respiratory, immunology, endocrinology, and women's health, with potential First-in-Class (FIC) or Best-in-Class (BIC) profiles [2][3]. - The company emphasized its advanced technology platforms, including long-acting release, conjugation technology, targeted delivery, and AI-assisted drug design, which are crucial for developing competitive drug candidates [2][3]. Group 2: Clinical Development Highlights - Gensci's GenSci134, a long-acting growth hormone analog, is in Phase I clinical trials, aimed at improving patient compliance in growth hormone deficiency [3]. - The NK3R antagonist GenSci074 for menopausal vasomotor symptoms has met all primary endpoints in Phase II trials, showing significant improvement over placebo, with plans for a global Phase III trial in Q2 2026 [3]. - The PD-1 agonist GenSci120 has received clinical approval in China and the U.S., demonstrating potential for chronic immune inflammatory diseases [4]. Group 3: Oncology Advancements - Gensci's GenSci128, targeting TP53 Y220C mutations, has entered clinical trials, addressing a significant unmet need in solid tumors [5]. - The new PI3Kα inhibitor GenSci145, recently accepted for IND, shows selective inhibition of PIK3CA mutations and potential for treating advanced solid tumors with brain metastases [5]. Group 4: Strategic Development and Global Expansion - Gensci is advancing over 40 clinical research projects and has achieved a milestone with the overseas licensing of GenSci098, totaling $1.365 billion, marking international recognition of its innovation [9]. - The company aims to develop a robust pipeline through a strategy that combines growth hormone, innovative drugs, and overseas business development, positioning itself for high-quality growth [9]. - The JPM conference serves as a platform for Gensci to showcase its innovations and foster global partnerships, reflecting a shift in the industry towards quality and global outreach [9].

Investment Rating - The report maintains an "Accumulate" rating for the Hong Kong innovative drug sector [1]. Core Insights - The current bull market for innovative drugs is driven by the potential for overseas business development (BD), marking a shift from domestic commercialization to international expansion, which is crucial for the industry's growth [6][15]. - The valuation of the Hong Kong innovative drug sector is at a historically low level, with the China Securities Hong Kong Innovative Drug Index's price-to-earnings (PE) ratio at 36.93, significantly lower than the industry average [16][21]. - The innovative drug industry in China has reached a turning point, with substantial improvements in both policy support and research capabilities, leading to increased global recognition of Chinese innovative drugs [6][54]. Summary by Sections 1. Hong Kong Innovative Drug Investment Value Analysis - The current bull market is characterized by a focus on overseas BD, with small-cap stocks showing significant gains [11]. - The Hong Kong innovative drug sector's PE ratio is at a historical low, enhancing its investment appeal [16]. - The sector's cost structure is aligning with that of A-share innovative drugs, and liquidity is improving, suggesting potential for higher valuations [25][28]. 2. Hong Kong Innovative Drug Industry Analysis - The innovative drug industry is entering a new phase, transitioning from generic to innovative drug development [46]. - Research capabilities have significantly improved, with a notable increase in the number of first-in-class (FIC) drugs being developed [51]. - The Chinese regulatory environment is increasingly aligning with international standards, enhancing the credibility of domestic clinical trials [54]. 3. Product Introduction: Hong Kong Innovative Drug ETF (513120) - The ETF closely tracks the China Securities Hong Kong Innovative Drug Index, which includes leading innovative drug companies [3]. - The ETF has shown superior performance compared to its peers, with a higher return rate and lower volatility [3][22]. - The ETF's top holdings are concentrated in leading pharmaceutical companies, providing a high degree of purity in its composition [3][24]. 4. Company Profiles - **BeiGene**: In a commercialization acceleration phase, with significant revenue growth and a robust pipeline [38]. - **Innovent Biologics**: Mature in commercialization, with a diverse product portfolio and strong global partnerships [39]. - **CSPC Pharmaceutical Group**: Transitioning from generics to innovative drugs, with several products expected to be approved soon [42]. - **Sihuan Pharmaceutical**: Deepening its innovative transformation, focusing on oncology and autoimmune diseases [45].