Core Viewpoint - The report highlights the rich product layout of innovative drugs by Zhongsheng Pharmaceutical, with a focus on the upcoming launch of its influenza product, Anladiwei tablets, which is expected to capture significant market share [1][2][3] Company Overview - Zhongsheng Pharmaceutical is primarily engaged in the research, production, and sales of traditional Chinese medicine and chemical drugs, with traditional Chinese medicine being its core business [1] - The company has established a solid foundation for growth through its well-known traditional Chinese medicine products, which are projected to generate 1.32 billion yuan in revenue by the end of 2024, accounting for 53% of total revenue [1] Innovative Drug Development - The company has successfully launched innovative drugs, including the first peptide-based 3CL single-agent anti-COVID drug, Lairuitewei tablets, and the recently approved influenza drug, Anladiwei tablets, which is a PB2-targeted small molecule RNA polymerase inhibitor [2] - Anladiwei tablets are expected to outperform current mainstream influenza drugs, showing faster symptom relief and lower resistance risk, thus potentially reshaping the influenza market landscape [2] Clinical Trial Results - The long-acting GLP-1 drug, RAY1225 injection, has shown promising results in Phase II clinical trials, demonstrating better weight loss and blood sugar control compared to similar drugs [2] - The drug's efficacy and safety profile are noteworthy, with ongoing Phase III clinical trials in China and potential for overseas rights authorization [2] Financial Projections - The company is expected to see revenue growth from 2.808 billion yuan in 2025 to 3.501 billion yuan in 2027, with year-on-year growth rates of 13.8%, 11.2%, and 12.1% respectively [3] - Net profit is projected to increase significantly from 305 million yuan in 2025 to 387 million yuan in 2027, with growth rates of 201.9%, 11.3%, and 14.1% respectively [3] Investment Recommendation - The report recommends a "buy" rating for Zhongsheng Pharmaceutical, emphasizing the positive outlook for its innovative drug portfolio and stable performance in traditional Chinese medicine and chemical generic drug sectors [3]

Core Insights - The company reported a significant increase in revenue and net profit for the first half of 2025, with revenue reaching 338 million yuan, a year-on-year growth of 69.69%, and net profit of 88.96 million yuan, a substantial increase of 308.29% [1] - The primary driver of this growth is attributed to the increased export sales of GLP-1 raw materials, specifically semaglutide and terzepatide [1][2] - The global demand for GLP-1 raw materials is expected to remain strong, with projections indicating a rise to 50 tons by 2030, driven by the expiration of semaglutide patents in 2026 [2] Financial Performance - The company achieved a net cash flow from operating activities of 21.32 million yuan, reflecting a year-on-year increase of 213.22% [1] - Sales expenses decreased by 32.18% due to reduced market business costs, despite the price adjustment of acetic acid octreotide injection [1] Market Expansion - The company has made significant progress in expanding its overseas market, with foreign income reaching 187 million yuan, a year-on-year increase of over 240% [2] - The establishment of an overseas business development team and acceleration of international registration and application processes have contributed to this growth [2] Research and Development - The company has improved its R&D output efficiency, obtaining certifications for semaglutide raw materials in South Korea and domestic registration for several injection products [3] - The company is also expanding its capabilities in the complex peptide innovative drug CDMO service area, with a project entering clinical phase III [3] Production Capacity - Key projects have been successfully implemented, enhancing the company's ability to respond to new order demands [3] - The production line for 395 kg of peptide raw materials has been successfully launched, and other projects have reached operational status [3] Strategic Focus - The company plans to continue focusing on the peptide pharmaceutical industry, emphasizing R&D innovation and internationalization [4] - Strategic directions include capturing the market for diabetes and obesity peptide drugs, expanding beauty peptide products, and strengthening R&D and production advantages in major disease areas [4]

Investment Rating - The report maintains a "Buy" rating for the company [4] Core Views - The company has established a multi-mode positive cycle research and development ecosystem, focusing on metabolic diseases and respiratory diseases, with two innovative drug projects already approved for market and several others in clinical trials [1] - The negative impacts on the company's main business have been largely digested, and it is expected to achieve steady growth in the future, with a projected net profit of 170-210 million yuan in the first half of 2025, representing a year-on-year growth of 94%-140% [2] - The company is expected to see a rebound in its main business, with innovative results gradually contributing to performance elasticity, projecting net profits of 351 million yuan, 435 million yuan, and 513 million yuan for 2025-2027, with corresponding growth rates of 217.4%, 23.8%, and 17.9% [2][3] Financial Summary - The company's revenue for 2023 is reported at 2,611 million yuan, with a year-on-year decline of 2.5%. It is expected to recover to 2,810 million yuan in 2025, reflecting a growth rate of 13.9% [3] - The net profit for 2023 is 263 million yuan, with a significant decline of 18.3%. However, it is projected to turn positive in 2025 with a net profit of 351 million yuan [3] - The earnings per share (EPS) is expected to improve from -0.35 yuan in 2024 to 0.41 yuan in 2025, indicating a recovery trend [3] Market Position and Product Development - The company’s core product, the brain thrombus capsule, is unique in the market, and the company is enhancing its product competitiveness through a combination of evidence-driven and market-driven cultivation models [2] - The innovative drug RAY1225 is progressing smoothly in clinical trials, showing significant potential for weight loss and improvement in metabolic indicators [7] - The company’s flu drug, Angladiwei, has a substantial market potential, with the global flu treatment market reaching 68.738 billion yuan in 2023, and it is expected to achieve rapid market penetration following its approval [7]

Core Viewpoint - The pharmaceutical industry is undergoing a profound transformation from "following innovation" to "source breakthrough," driven by new quality productivity and technological innovation [2][12]. Company Overview - Guangdong Zhongsheng Pharmaceutical Co., Ltd. was established in 1979 and listed on the Shenzhen Stock Exchange in December 2009, with stock code 002317 [4]. - The company integrates drug research and development, production, and sales, positioning itself as one of China's top 100 pharmaceutical companies [4]. - Zhongsheng Pharmaceutical focuses on high-quality products and services, with a product portfolio covering major disease areas such as cardiovascular, respiratory, ophthalmology, and digestion [4]. Innovation and Product Development - The company has established a development strategy centered on traditional Chinese medicine, innovation, and focusing on specialty areas, with core products including the Compound Thrombus Tong series and Brain Thrombus Tong capsules [4]. - Zhongsheng is the only domestic company with innovative drugs for both COVID-19 and influenza, having successfully launched the first peptide 3CL single-agent antiviral drug for COVID-19 and the first RNA polymerase PB2 protein inhibitor for influenza [4][8]. - The company has invested in innovative drug development, with two new drugs launched recently, including the innovative drug for treating adult influenza, which was approved in May [8]. Digital Transformation - The company is investing 300 million yuan in its subsidiary to create a smart, digital, and intensive traditional Chinese medicine extraction workshop [9]. - Advanced technologies such as cloud computing, big data, artificial intelligence, and IoT are being utilized to enhance the entire pharmaceutical supply chain [7][9]. Sustainable Development Strategy - Zhongsheng emphasizes the coordination between traditional and emerging businesses, proposing a sustainable development structure that includes innovative drugs as the leading force, traditional Chinese medicine as the foundation, and chemical generics as support [10]. - The company has maintained a research and development investment of over 8% of its revenue annually since 2010, with recent years exceeding 10% [12]. Industry Trends - The core of new quality productivity in the biopharmaceutical industry lies in technological innovation and the transformation of results [6]. - The industry is expected to evolve towards innovation-driven and high-quality growth, supported by policy, market changes, and technological advancements [6].

Group 1: Clinical Trial Results - RAY1225 injection shows significant weight loss in obese/overweight participants with a mean percentage change from baseline of -10.05%, -12.98%, and -15.05% for the 3mg, 6mg, and 9mg groups respectively, compared to -3.55% in the placebo group [3] - The percentage of participants achieving weight loss ≥5% was 73.2%, 95.1%, and 95.1% for the 3mg, 6mg, and 9mg groups respectively, while the placebo group had a rate of 51.2% for weight loss ≥10% [4] - In the SHINING-1 trial, the HbA1c levels decreased by -1.68%, -2.06%, and -2.16% for the 3mg, 6mg, and 9mg groups respectively, compared to -0.33% in the placebo group [6] Group 2: Safety and Tolerability - RAY1225 injection demonstrated good safety and tolerability across both REBUILDING-1 and SHINING-1 trials, with a low risk of hypoglycemia and no new safety signals identified [10] - The most common adverse reactions were gastrointestinal, with a lower incidence compared to similar drugs [10] Group 3: Future Development and Market Strategy - The company has received ethical approval for Phase III clinical trials of RAY1225 for obesity and type 2 diabetes, with participant enrollment for REBUILDING-2 initiated in June 2025 [10] - The company plans to enhance its marketing strategy for the newly approved drug, focusing on academic ecosystem construction, data-driven service upgrades, and key project practices [14][15] Group 4: Research and Development Investment - The company has consistently invested over 8% of its annual revenue in R&D, with the last three years exceeding 10% [16] - The focus is on building a diversified R&D matrix that includes traditional Chinese medicine, innovative drugs, and generic drugs, transitioning towards an innovative pharmaceutical enterprise [18] Group 5: International Collaboration and Market Expansion - The company emphasizes the importance of international collaboration for expanding market opportunities and enhancing global R&D capabilities [19] - Plans are in place to explore the commercial potential of innovative drug pipelines and seek international partnerships [19] Group 6: Shareholder and Subsidiary Management - The company redeemed 13.15% of shares from its subsidiary, increasing its ownership from 61.11% to 74.26%, enhancing control and operational efficiency [20] - This move is part of a broader strategy to strengthen the company's position in innovative drug development, particularly in respiratory and metabolic disease areas [20][21]

Group 1: Basic Information - The surveyed company is Zhongshan Biologics Co., Ltd., belonging to the traditional Chinese medicine industry. The survey was conducted on July 17, 2025, and the company's receptionists included the board secretary, the president of Zhongrui Innovation, and the securities business manager [8]. - Participating survey institutions include Zheshang Securities Co., Ltd., Tianfeng Securities Co., Ltd., Caitong (a fund management company), Beijing Dingsa Investment Co., Ltd., and individual investors [2][9]. Group 2: R & D Pipeline Layout - The company has established a multi - mode R & D ecosystem, focusing on metabolic and respiratory diseases. It has 2 approved innovative drugs and multiple projects in clinical trials [14]. - In the metabolic disease R & D pipeline, ZSP1601 tablets for MASH are in Phase IIb clinical trials, and RAY1225 injection for T2DM and obesity/overweight has completed Phase II trials and is entering Phase III [14][15]. - In the respiratory disease R & D pipeline, Lairetrievir tablets have been approved and included in the national medical insurance, and Angladivir tablets have been approved in May 2025. Angladivir granules have obtained Phase II clinical trial top - line data [15][16]. Group 3: RAY1225 Injection Phase II Clinical Trial Results - RAY1225 injection has dual - receptor agonistic activity. Its Phase II trials for obesity/overweight and T2DM patients reached the primary endpoints [17]. - In the REBUILDING - 1 trial for obesity/overweight patients, 3mg, 6mg, and 9mg groups showed dose - dependent weight loss, with better results than the placebo group and numerically higher weight - loss达标 rates than Tirzepatide [17][18]. - In the SHINING - 1 trial for T2DM patients, 3mg, 6mg, and 9mg groups showed dose - dependent reduction in HbA1c, with better results than the placebo group and numerically higher glycemic - control达标 rates than Tirzepatide [20][21]. - RAY1225 injection has significant comprehensive advantages in improving cardiovascular - kidney - metabolic indicators and has good safety [22]. Group 4: Angladivir Project R & D Status - Angladivir tablets were approved in May 2025, with better efficacy than the placebo and Oseltamivir in clinical trials, and strong inhibitory effects on various influenza virus strains [24]. - Angladivir granules for 2 - 17 - year - old patients with influenza A have obtained Phase II clinical trial top - line data, showing positive efficacy and good safety [25][26]. Group 5: Marketing Plan for Angladivir Tablets - The company deepens marketing innovation in three dimensions: academic ecosystem construction, data - service upgrade, and key project implementation [27]. Group 6: R & D Investment - The company's annual R & D investment has exceeded 8% of its revenue for many years, and over 10% in the past three years. It will continue to invest in R & D to build a diversified R & D matrix [27][28]. Group 7: Overseas Progress of Innovative Drugs - The company values overseas market opportunities for innovative drugs and will seek international cooperation to create long - term value [28].

R&D Pipeline and Innovations - The company has established a multi-modal, positive cycle R&D ecosystem focusing on metabolic diseases and respiratory diseases, with 2 innovative drug projects approved for market and several in clinical trials [1][2] - ZSP1601 tablets, targeting metabolic dysfunction-related fatty liver disease (MASH), are the first domestic innovative drug project to complete clinical trials for safety and pharmacokinetics, showing significant potential in reducing liver inflammation markers [1][2] - RAY1225 injection, a long-acting GLP-1 analog, has shown promising results in Phase II trials for obesity and Type 2 diabetes, achieving primary endpoints in both REBUILDING-1 and SHINING-1 trials [2][5] Clinical Trial Results - In the REBUILDING-1 trial, RAY1225 injection demonstrated a dose-dependent weight loss: 3mg, 6mg, and 9mg groups showed weight reductions of -10.05%, -12.98%, and -15.05% respectively, compared to -3.55% in the placebo group [5][7] - The SHINING-1 trial indicated significant reductions in HbA1c levels: -1.68%, -2.06%, and -2.16% for the 3mg, 6mg, and 9mg groups respectively, with the placebo group at -0.33% [8][10] - RAY1225 injection also showed superior results in cardiovascular and metabolic indicators, with significant reductions in uric acid levels compared to the placebo [8] Product Approvals and Market Strategy - The oral antiviral drug, Lai Ruitewei tablets (乐睿灵®), received conditional approval in March 2023 and is included in the national medical insurance directory, enhancing patient access [3] - The company’s innovative drug Angladiwei tablets (安睿威®) was approved in May 2025, showing significant efficacy in alleviating flu symptoms compared to the placebo [4][11] - The company is focusing on building an academic ecosystem and enhancing digital services to improve healthcare delivery and patient trust [14][15] Investment and Future Directions - The company has consistently invested over 10% of its revenue in R&D over the past three years, emphasizing the importance of innovation in its growth strategy [15] - Plans for international collaboration on innovative drugs are underway to expand market opportunities and enhance global brand influence [16][18]

Core Viewpoint - The company expects a significant increase in net profit for the first half of 2025, driven by reduced non-recurring factors and the approval of new drugs [1][2]. Group 1: Financial Performance - The company anticipates a net profit of 170 to 210 million yuan for the first half of 2025, representing a year-on-year growth of 94.49% to 140.25%, primarily due to the diminishing impact of non-recurring gains from 2024 [2]. - The expected growth in net profit excluding non-recurring items is projected to be between 3.64% and 26.67% [2]. - Revenue forecasts for 2025 to 2027 are estimated at 2.712 billion, 2.997 billion, and 3.290 billion yuan, respectively, with corresponding EPS of 0.39, 0.49, and 0.60 yuan [4]. Group 2: Product Development - The company has received approval for its innovative drug, Angladiwe, which is the world's first RNA polymerase PB2 protein inhibitor for influenza, expected to contribute to future growth [2]. - Angladiwe is the only anti-influenza drug in China that has undergone head-to-head phase III clinical trials with Oseltamivir, showing a nearly 10% reduction in median time to fever relief compared to Oseltamivir [2]. - The company is rapidly advancing its GLP-1/GIP dual receptor agonist, RAY1225, which has shown promising results in weight loss and metabolic improvement, with ongoing phase III clinical trials in China [3]. Group 3: Market Potential - RAY1225 has potential for international licensing and is positioned to compete effectively in the market, with a higher weight loss achievement rate compared to existing treatments [3][4]. - The company plans to participate in the 2025 medical insurance negotiations for Angladiwe, and is also developing a pediatric formulation of the drug, which has shown favorable results in phase II clinical trials [2].

Core Viewpoint - The company has successfully completed the first lock-up period of its 2024 employee stock ownership plan, allowing 45 eligible participants to unlock 30% of the initially granted shares, totaling 1.467 million shares, which represents 0.17% of the company's total share capital [2][7]. Implementation of Employee Stock Ownership Plan - The company held board meetings on June 14, 2024, and July 1, 2024, to approve the implementation of the employee stock ownership plan [2]. - On July 16, 2024, the company transferred 5.551 million shares to the dedicated account for the employee stock ownership plan, which accounted for 0.65% of the total share capital at that time [3]. - The stock ownership plan has three unlocking phases, with the first phase's unlocking conditions met on July 16, 2025 [3][4]. Performance Assessment - The performance assessment for the first lock-up period included company-level targets for revenue and innovation drug development progress [4]. - The company achieved its innovation drug development goals, with significant progress in clinical trials for multiple drugs, resulting in a 100% unlocking ratio for this performance metric [5][6]. - Individual performance assessments for the 45 participants were all rated B+ or above, meeting the criteria for full unlocking [7]. Future Arrangements - Following the unlocking of the first lock-up period, the employee stock ownership management committee will manage the rights of the participants according to the authorized decisions made in the meetings [8]. - The company will adhere to market trading rules and relevant regulations regarding stock transactions [8].

Group 1: Innovative Drug Development - The company has established a multi-mode, positive cycle research and development ecosystem, focusing on metabolic diseases and respiratory diseases, with two innovative drug projects approved for market and several in clinical trials [2][4]. - ZSP1601 tablets, targeting metabolic dysfunction-related fatty liver disease (MASH), have shown significant reduction in liver inflammation markers after four weeks of treatment, indicating potential for improving liver inflammation and fibrosis [2][4]. - RAY1225 injection, a long-acting GLP-1 class drug, has completed Phase II clinical trials for obesity and type 2 diabetes, achieving primary endpoints and demonstrating significant weight loss and metabolic improvements [4][14][18]. Group 2: Clinical Trial Results - RAY1225 injection demonstrated a weight loss of -10.05%, -12.98%, and -15.05% for 3mg, 6mg, and 9mg doses respectively, significantly outperforming the placebo group [14][16]. - The RAY1225 injection also showed a reduction in HbA1c levels of -1.68%, -2.06%, and -2.16% for the same doses, with a notable percentage of participants achieving target HbA1c levels [16][18]. - The clinical trial for the oral antiviral drug, Liratewe tablets, has been approved and included in the national medical insurance directory, providing accessible treatment options for patients [5][6]. Group 3: Safety and Efficacy - The clinical trials for RAY1225 injection reported good safety and tolerability, with low incidence of gastrointestinal adverse effects, similar to previous GLP-1 drug profiles [18]. - The clinical trial for Anglave tablets showed a median flu symptom relief time of 31.72 hours, with no serious adverse events reported, indicating good safety and efficacy in children and adolescents [10][11]. - Anglave tablets demonstrated a significant reduction in flu symptoms compared to placebo, achieving statistical significance in symptom relief and viral load reduction [10][11]. Group 4: Research and Development Investment - The company has consistently invested over 8% of its annual revenue in R&D, with the last three years exceeding 10%, reflecting a commitment to innovation and development [19]. - The R&D strategy includes a diversified matrix of traditional Chinese medicine, innovative drugs, modified new drugs, chemical generics, and raw materials, transitioning from a traditional to an innovative pharmaceutical enterprise [19].