Core Insights - Over 20 drugs are expected to participate in the price negotiation for the commercial insurance innovative drug catalog this year [1] - The price negotiation will take place from this afternoon until tomorrow, with around ten pharmaceutical companies already present [1] Group 1: Participating Companies - BeiGene is bringing multiple drugs to the negotiation, including injection drugs such as Zhenidamab, Dato-DXd injection, and Belantamab Mafodotin [1] - Belantamab Mafodotin is included in both commercial insurance and medical insurance negotiations [1] - Five major CAR-T product companies, along with companies like Green Leaf Pharmaceutical and New Era Pharmaceutical, are also participating in the negotiation [1]

Core Insights - The article discusses the recent approval of several high-priced innovative drugs for the commercial insurance innovation drug directory, which were previously excluded from the basic medical insurance directory due to high costs [2][5] - Over 60% of the drugs included in the commercial insurance innovation drug directory have also applied for the basic medical insurance directory, indicating a dual strategy by pharmaceutical companies [2][5] - The National Healthcare Security Administration (NHSA) has initiated a new phase of expert reviews for these drugs, which will determine their final inclusion in the insurance directories [10] Group 1: Drug Approval and Market Dynamics - A total of 121 innovative drugs passed the preliminary review for the commercial insurance innovation drug directory, with 141 applications submitted [5] - Approximately 80 drugs applied for both the basic medical insurance and commercial insurance directories, highlighting a trend towards dual applications [5][9] - The article identifies five categories of drugs that were only submitted for the commercial insurance directory, including rare disease treatments and newly approved drugs with limited clinical data [3][4] Group 2: Pricing and Economic Considerations - Some high-priced rare disease treatments have annual costs exceeding 1 million yuan, which have previously failed to meet the basic medical insurance criteria [6] - The NHSA emphasizes that the approval for the basic medical insurance directory does not guarantee inclusion, as drugs must pass rigorous evaluations and negotiations [9] - The article notes that the commercial insurance directory may serve as a transitional option for innovative drugs that exceed the acceptable pricing thresholds for basic medical insurance [5][10] Group 3: Industry Perspectives and Future Implications - Industry experts suggest that the commercial insurance innovation drug directory should focus on new drugs that fill clinical gaps and provide differentiated treatment options [7] - There is a concern among pharmaceutical companies regarding the potential impact of drug inclusion on insurance premiums and patient access [10][11] - The article highlights the need for real-world evidence to support the clinical efficacy of some newly approved drugs, which may influence their acceptance in the basic medical insurance directory in the future [8][9]

Core Viewpoint - The article discusses the recent approval of high-priced innovative drugs for commercial insurance innovation drug directory, highlighting the ongoing negotiations for inclusion in the basic medical insurance directory, which remains the primary goal for most innovative drug companies [3][4][8]. Summary by Sections Approval Process - The National Medical Insurance Administration announced that 121 innovative drugs passed the preliminary formal review for the commercial insurance innovation drug directory, with a significant number also applying for the basic medical insurance directory [3][7]. - The review process assesses whether the drugs meet the criteria for inclusion in the insurance directories and the completeness of their information [7]. Drug Categories - Less than 40% of the drugs approved only for the commercial insurance innovation drug directory fall into five main categories: rare disease medications, newly approved drugs with limited real-world evidence, globally priced drugs that still do not meet basic insurance thresholds, high-priced new drugs for existing treatments, and preventive biological agents restricted by legal regulations [4][5]. Dual Directory Applications - Approximately 80 drugs, or about 60% of those in the commercial insurance innovation drug directory, applied for both directories, indicating a transitional strategy for many innovative drug companies [8]. - Many high-priced innovative drugs that exceed the acceptable value threshold for basic medical insurance are opting for single directory applications [8][10]. Market Dynamics - The competition in the market for cancer drugs and other treatment areas is intensifying, with a focus on "true innovation" and "differentiated innovation" as encouraged by the National Medical Insurance Administration [10]. - The article notes that some innovative drugs are being submitted for commercial insurance first, with the expectation that they may later be evaluated for inclusion in the basic medical insurance directory once sufficient real-world data is available [11]. Insurance Considerations - The decision to include innovative drugs in the commercial insurance directory is influenced by factors such as the drug's appeal to insurance products, potential premium increases, and the risk of excessive claims [14][15]. - The article highlights the differences in coverage and reimbursement capabilities across various regions, which may affect the sales pathways for innovative drugs [15].

Core Insights - This year, several high-priced innovative drugs that were previously excluded from the basic medical insurance directory due to the "invisible threshold" have passed the preliminary review for the commercial insurance innovative drug directory [1][2] - Over 60% of the drugs included in the preliminary review for the commercial insurance innovative drug directory are also applying for the basic medical insurance directory, indicating a dual strategy among pharmaceutical companies [1][4] - The National Medical Insurance Administration has published a list of 121 innovative drugs that passed the preliminary review for the commercial insurance innovative drug directory, reflecting a significant interest from pharmaceutical companies in gaining access to broader insurance coverage [3][8] Summary by Categories Innovative Drug Directory - A total of 141 applications were received for the commercial insurance innovative drug directory, with 121 passing the preliminary review, marking the first year this directory has been included in the adjustment process [3] - Approximately 40% of the drugs that only applied for the commercial insurance innovative drug directory are primarily rare disease medications, newly approved drugs with limited clinical data, and high-priced innovative drugs that do not meet the basic insurance entry threshold [2][4] Dual Directory Applications - About 80 drugs, or roughly 60% of those in the commercial insurance innovative drug directory, have also applied for the basic medical insurance directory, suggesting that the commercial directory serves as a transitional option for many innovative drug companies [4][9] - The drugs that opted for "single directory" applications are often those with high innovation and clinical value but priced significantly above the acceptable threshold for basic medical insurance [4][5] Pricing and Market Dynamics - The pricing of innovative drugs is a critical factor, with some drugs being priced at levels that are already the lowest globally, yet still not qualifying for basic medical insurance [6][8] - The competitive landscape for oncology drugs is intensifying, with companies considering the potential for inclusion in the commercial insurance directory as a means to enhance product attractiveness without significantly raising premiums [9][10] Future Considerations - The expert review phase for the drugs that passed the preliminary review will begin soon, with a focus on whether these drugs can be included in the commercial insurance directory and the basic medical insurance directory [9] - There is a growing sentiment in the industry that innovative drugs with uncertain clinical benefits may initially enter the commercial insurance directory before being reassessed for basic medical insurance inclusion based on real-world data [7][10]

Core Insights - The Chinese innovative drug sector is experiencing rapid growth, with over 20 class 1 innovative drugs approved in the first five months of 2025, setting a record for the past five years [1][2] - The focus of these new drugs is primarily on oncology treatments, indicating a shift from "follow-up innovation" to "global leadership" in the pharmaceutical industry [1][3] Approval and Market Trends - In May 2025, the National Medical Products Administration approved 11 innovative drugs, including 7 class 1 drugs, highlighting a significant increase in approvals since 2020 [2] - The number of approved domestic class 1 innovative drugs has risen from single digits in 2018 and 2019 to over 30 in 2023 and 2024, with expectations to exceed 50 in 2025 [2][3] Policy Support and Innovation - Recent favorable policies have enhanced the innovation environment, covering all stages from research and evaluation to production and payment, thereby accelerating market access and shortening return cycles [4][5] - The implementation of a comprehensive support system for innovative drugs, including payment channel expansion and dynamic adjustments to the drug catalog, is expected to further stimulate research and development [5] International Competitiveness - China's biopharmaceutical research capabilities have significantly improved, with Chinese scholars ranking second globally in publications in top-tier journals [7] - At the ASCO annual meeting, over 70 original research results from China were presented, showcasing advancements in oncology and metabolic diseases [7] - The market confidence in domestic innovative drugs is reflected in the rapid growth of licensing agreements, with a total of $45.5 billion in license-out transactions reported in the first five months of 2025 [7][8]

Core Insights - The approval of innovative drugs is a significant indicator of the new productive forces in the biopharmaceutical industry, with Suzhou Industrial Park accounting for approximately 20% of the new innovative drugs approved in China this year [1][3]. Group 1: Drug Approvals - As of July 10, 2023, Ascentage Pharma's new Bcl-2 selective inhibitor, Lisatoclax, received approval for treating adult patients with chronic lymphocytic leukemia/small lymphocytic lymphoma who have undergone prior systemic therapy [1]. - On July 8, 2023, Suzhou Wangshan Wangshui Biopharmaceutical Co., Ltd. and the Shanghai Institute of Materia Medica collaborated to launch a new drug, Semaglutide, for the treatment of erectile dysfunction [1]. - On June 27, 2023, Innovent Biologics' injection, Ma Shidu, was approved for long-term weight management in adults with obesity or overweight, being the first dual receptor agonist for weight loss globally [1]. - On May 29, 2023, the injection of Trastuzumab deruxtecan was approved for treating adult patients with HER2-mutant non-small cell lung cancer who have received prior systemic therapy, marking it as the first antibody-drug conjugate for this indication in China [2]. - On the same day, BeiGene's bispecific antibody, Zhenidamab, was approved for patients with HER2-positive advanced biliary tract cancer, providing a new treatment option [2]. - On January 10, 2023, the approval of the long-acting PCSK9 monoclonal antibody, Rucaparib, was granted for treating high cholesterol levels [2]. Group 2: Industry Development - Since 2006, Suzhou Industrial Park has focused on the biopharmaceutical and health industry, attracting over 2,000 related enterprises, with a projected output value of 165.5 billion yuan by 2024 [3]. - The park has implemented a targeted investment strategy, introducing approximately 300 biopharmaceutical and health projects annually over the past three years [3]. - In May 2023, Suzhou Industrial Park announced an action plan to accelerate the growth of the biopharmaceutical and health industry, aiming to develop over five leading enterprises with international competitiveness and achieve significant sales milestones by 2027 [3].

Core Viewpoint - The National Medical Products Administration has approved 11 innovative drugs for market launch, with 5 of them coming from Jiangsu province, indicating a strong focus on promoting local pharmaceutical innovation [1][2]. Group 1: Approved Innovative Drugs - Jiangsu province has received approval for 7 domestic Class 1 innovative drugs this year, with the latest batch including 5 drugs from Suzhou (3), Lianyungang (1), and Taizhou (1) [1]. - The approved drugs include: - Injection of Rukang Qumai (瑞康曲妥珠单抗) for treating HER2 mutated non-small cell lung cancer (NSCLC) patients [1]. - Hydrochloride of Jikaxitini tablets for patients with primary myelofibrosis and related conditions [1]. - Injection of Zenidatuzumab for HER2 high-expressing cholangiocarcinoma patients who have received prior systemic therapy [1]. - Malic acid of Famitinib capsules for recurrent or metastatic cervical cancer patients who failed platinum-based chemotherapy [2]. - Injection of Agrestin α for adult patients undergoing chemotherapy that may cause febrile neutropenia [2]. Group 2: Regulatory and Supportive Measures - The Jiangsu Provincial Drug Administration is implementing comprehensive reforms to enhance the pharmaceutical and medical device regulatory environment, aiming to create a high-quality development policy landscape [2][3]. - The administration has established a service mechanism to support innovative drug development, focusing on personalized guidance throughout the clinical trial and approval processes [2][3]. - Ongoing efforts include building a competitive strategic emerging industry cluster and promoting open innovation across the entire biopharmaceutical industry chain [3].

Investment Rating - The report assigns an "Overweight" rating to the pharmaceutical and biotechnology industry, indicating that the industry index is expected to outperform the CSI 300 index by 10% or more over the next six months [2][37]. Core Insights - The pharmaceutical and biotechnology sector saw an overall increase of 2.21% in the week from May 26 to May 30, ranking second among 31 industries in the Shenwan index and outperforming the CSI 300 index by 3.29 percentage points. Year-to-date, the sector has risen by 6.61%, ranking sixth among the 31 industries and outperforming the CSI 300 index by 9.02 percentage points [4][13][15]. - The current PE valuation for the pharmaceutical and biotechnology sector is 27.98 times, which is at the historical median level, with a valuation premium of 137% compared to the CSI 300 index. The top three sub-sectors in terms of growth are chemical pharmaceuticals, biological products, and medical services, with increases of 3.83%, 3.14%, and 2.46% respectively [4][22][15]. - A total of 373 stocks (77.9%) in the sector rose last week, while 97 stocks (20.3%) declined. The top five gainers were Shuyou Shen (60.41%), Huason Pharmaceutical (41.97%), Changshan Pharmaceutical (35.91%), Huana Pharmaceutical (32.62%), and Yifang Biological (30.51%) [4][27]. Market Performance - The pharmaceutical and biotechnology sector's performance is highlighted by the approval of 11 innovative drugs by the National Medical Products Administration (NMPA) on May 29, which enhances treatment options for patients and showcases the increasing innovation capability of China's pharmaceutical industry [5][29]. - The 2025 American Society of Clinical Oncology (ASCO) annual meeting showcased several domestic innovative drug projects, indicating that local companies are gaining international recognition for their innovative capabilities [5][32]. Investment Recommendations - The report suggests focusing on the innovative drug sector as it is the most certain and leading sub-sector within the pharmaceutical and biotechnology industry. Additionally, it recommends exploring investment opportunities in medical devices, traditional Chinese medicine, chain pharmacies, and medical services [6][35]. - Recommended stocks include Beida Pharmaceutical, Te Bao Biological, Qianhong Pharmaceutical, Ling Rui Pharmaceutical, and Lao Bai Xing. Stocks to watch include Kelong Pharmaceutical, Rongchang Biological, Kaili Medical, Huaxia Eye Hospital, and Baipu Sais [6][35].

Investment Rating - The report assigns an "Overweight" rating to the pharmaceutical and biotechnology industry, indicating that the industry index is expected to outperform the CSI 300 index by 10% or more over the next six months [2][37]. Core Insights - The pharmaceutical and biotechnology sector saw an overall increase of 2.21% in the week from May 26 to May 30, ranking second among 31 industries in the Shenwan index and outperforming the CSI 300 index by 3.29 percentage points. Year-to-date, the sector has risen by 6.61%, ranking sixth among the 31 industries and outperforming the CSI 300 index by 9.02 percentage points [4][13][15]. - The current PE valuation for the pharmaceutical and biotechnology sector is 27.98 times, which is at the historical median level, with a valuation premium of 137% compared to the CSI 300 index. The top three sub-sectors in terms of growth are chemical pharmaceuticals, biological products, and medical services, with increases of 3.83%, 3.14%, and 2.46% respectively [4][22][15]. Summary by Sections Market Performance - The pharmaceutical and biotechnology sector's performance for the week of May 26 to May 30 was a 2.21% increase, ranking second among 31 industries, and outperforming the CSI 300 index by 3.29 percentage points. Year-to-date, the sector has increased by 6.61%, ranking sixth and outperforming the CSI 300 by 9.02 percentage points. The top three sub-sectors were chemical pharmaceuticals (3.83%), biological products (3.14%), and medical services (2.46%) [4][13][15]. Industry News - On May 29, the National Medical Products Administration (NMPA) approved 11 innovative drugs, with 9 being domestically developed, showcasing the increasing innovation capability of China's pharmaceutical industry. Additionally, during the 2025 American Society of Clinical Oncology (ASCO) annual meeting, significant clinical data was presented for various treatments, indicating the growing recognition of domestic innovative drug companies [5][29][32]. Investment Recommendations - The report suggests focusing on the innovative drug sector, which is seen as the most certain and leading sub-sector within the pharmaceutical and biotechnology industry. It also recommends exploring investment opportunities in medical devices, traditional Chinese medicine, chain pharmacies, and medical services. Specific stock recommendations include Beida Pharmaceutical, Teva Biopharma, Qianhong Pharmaceutical, Lingrui Pharmaceutical, and Lao Baixing, with additional stocks to watch including Kelun Pharmaceutical, Rongchang Biopharma, Kaili Medical, Huaxia Eye Hospital, and Baipusais [6][35].

Core Insights - The National Medical Products Administration approved 11 innovative drugs recently, with 10 coming from listed companies, indicating a significant advancement in China's pharmaceutical sector [1][4] - The approval of these drugs marks a pivotal moment for the industry, as it transitions into a phase of realizing the results of extensive research and development efforts [7][8] Group 1: Drug Approvals and Innovations - Among the approved drugs, several are the first of their kind in China, including Bai Jie Shen Zhou's injection of Zhenida Monoclonal Antibody, which is the first HER2 dual-target drug approved for cholangiocarcinoma [4][5] - Heng Rui Pharmaceutical's Apixaban is a multi-target tyrosine kinase inhibitor approved for use in advanced solid tumors, showcasing innovative treatment mechanisms [4][5] - The approval of Zai Jing Pharmaceutical's Jikaxitinib marks the first domestic JAK inhibitor for treating myelofibrosis, providing new options for patients with rare blood cancers [5][6] Group 2: Market Trends and Investment Opportunities - The innovative drug sector has seen a strong market performance, with 53 stocks hitting the daily limit up, indicating heightened investor interest [2][7] - Analysts predict that 2025 will be a transformative year for the pharmaceutical industry, characterized by increased revenue, profitability, and valuation improvements [1][7] - The Hong Kong innovation drug index has seen significant capital inflow, with over 200 million yuan in net inflow over the past 20 trading days, reflecting strong market sentiment [2][8] Group 3: Challenges and Future Outlook - Despite the positive developments, the innovative drug industry faces challenges such as high uncertainty in commercialization and intense competition among similar products [7][8] - The industry is supported by favorable policies and the growth of commercial health insurance, which enhances the payment environment for innovative drugs [8]