Core Viewpoint - The Hong Kong pharmaceutical sector has attracted significant market attention this year, with southbound funds net buying over 160 billion yuan in the healthcare industry, ranking third among 12 Hang Seng primary sectors [1] Group 1: Policy and Industry Dynamics - The surge in southbound funds is driven by a threefold resonance of policy, industry, and capital, creating new opportunities for the biopharmaceutical sector [2] - Recent policies, including measures to support high-quality development of innovative drugs and the introduction of a fast-track listing process for unprofitable biotech firms, have injected strong momentum into industry innovation [2] - As of Q3, there are over 100 biopharmaceutical companies listed on the Hong Kong Stock Exchange, with a total market capitalization accounting for approximately 15% of the Hong Kong stock market [2] - China's innovative drug R&D capabilities are steadily improving, with the number of innovative drug pipelines expected to reach 4,804 by 2024, second only to the United States globally [2] - The compound annual growth rate (CAGR) of license-out transaction amounts for Chinese innovative drugs from 2019 to 2024 is as high as 125%, indicating a rapid internationalization of the sector [2] Group 2: Financial Environment - The liquidity of the Hong Kong pharmaceutical sector is expected to improve continuously due to the onset of the Federal Reserve's interest rate cut cycle and a more accommodative domestic monetary policy [3] - From January to August this year, the financing amount for domestic innovative drugs increased by over 40% year-on-year, reflecting a rapid recovery in the sector's financing vitality [3] Group 3: Investment Opportunities - The newly launched Hang Seng Biotech ETF (Fund Code: 159132) aims to provide investors with an efficient tool to invest in leading biotech companies listed in Hong Kong [4] - The Hang Seng Biotech Index, which the ETF tracks, includes 30 leading biotech, pharmaceutical, and medical device companies, with nearly 90% of its weight focused on high-growth sectors like innovative drugs and CXO [4] - The index has shown a cumulative increase of 58.9% since its inception, significantly outperforming the Hang Seng Healthcare Index (19.8%) and the Hang Seng Index (12.5%) [5] - The launch of Hang Seng Biotech Index futures on November 28 is expected to enhance market liquidity and trading activity by attracting institutional investors [5] Group 4: Management Expertise - The proposed fund manager for the Hang Seng Biotech ETF is a seasoned professional with over 12 years of experience in securities and more than 8 years in investment management, specializing in quantitative investment [6][7]

Core Viewpoint - The Hong Kong pharmaceutical sector has attracted significant market attention this year, with southbound funds net buying over 160 billion yuan in healthcare, ranking third among 12 Hang Seng primary industries [1] Group 1: Policy and Industry Dynamics - The surge in southbound funds in the Hong Kong pharmaceutical sector is driven by a combination of policy support, industry advancements, and capital influx, creating new opportunities for the biopharmaceutical industry [2] - Recent policies, including measures to support high-quality development of innovative drugs and the introduction of a fast-track listing process for unprofitable biotech companies, have provided strong momentum for industry innovation [2] - As of Q3, there are over 100 biopharmaceutical companies listed on the Hong Kong Stock Exchange, with a total market capitalization accounting for approximately 15% of the Hong Kong stock market [2] - China's innovative drug research and development capabilities are steadily improving, with the number of innovative drug pipelines expected to reach 4,804 by 2024, second only to the United States [2] - The license-out transaction value for Chinese innovative drugs has seen a compound annual growth rate of 125% from 2019 to 2024, with nearly 50 billion USD in overseas transactions expected in the first half of 2025 [2] Group 2: Financial Environment - The liquidity in the Hong Kong pharmaceutical sector is expected to improve, supported by the Federal Reserve's interest rate cuts and a more accommodative domestic monetary policy [3] - From January to August this year, the financing amount for domestic innovative drugs increased by over 40% year-on-year, indicating a rapid recovery in financing vitality within the sector [3] Group 3: Investment Opportunities - The upcoming launch of the Fuguo Hang Seng Biotechnology ETF (Fund Code: 159132) on December 1 aims to provide investors with an efficient tool to invest in leading biotech companies listed in Hong Kong [1][4] - The Hang Seng Biotechnology Index, which the ETF tracks, includes 30 leading biotech, pharmaceutical, and medical device companies, focusing on high-growth sectors such as innovative drugs and CXO services, with nearly 90% combined weight [4] - The index has shown a cumulative increase of 58.9% since its inception, significantly outperforming the Hang Seng Healthcare Index and the Hang Seng Index [5] - The introduction of futures for the Hang Seng Biotechnology Index on November 28 is expected to enhance market liquidity and attract more institutional investors [5]