HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Thematic (Sector/Industry)

Industry viewpoints:<ul>
<li>Recently, a new document was released by the National Health Care Security Administration about the centralized procurement of high-value medical consumables.</li>
<li>The bidding of the 5th national volume-based purchase (VBP) will be officially opened on June 23, 2021.</li>
<li>The scale of China's rehabilitation therapy industry is growing rapidly.</li>
</ul>Company news:News about the new ultrasound system and updated progress on drugs of <a href="https://www.smartkarma.com/entities/remegen-co-ltd" target="_blank" data-smartkarma-citation="entities:29191:1" rel="noopener">Remegen Co Ltd (9995 HK)</a>, <a href="https://www.smartkarma.com/entities/beigene-ltd" target="_blank" data-smartkarma-citation="entities:27352:1" rel="noopener">BeiGene Ltd (6160 HK)</a>, <a href="https://www.smartkarma.com/entities/shenzhen-mindray-bio-medic-a" target="_blank" data-smartkarma-citation="entities:28017:1" rel="noopener">Shenzhen Mindray Bio-Medical Electronics (300760 CH)</a> and <a href="https://www.smartkarma.com/entities/jiangsu-hengrui-medicine-co-ltd" target="_blank" data-smartkarma-citation="entities:14128:1" rel="noopener">Jiangsu Hengrui Medicine (600276 CH)</a>.Market review:Last week, stock price for healthcare sector in A share decreased 0.81%, while CSI 300 decreased 1.09% over the same period of time.Risk disclosure:Policy risk, R&amp;D risk, Company risk and COVID-19 risk.

Industry viewpoints:
Recently, a new document was released by the National Health Care Security Administration about the centralized procurement of high-value medical consumables.
The bidding of the 5th national volume-based purchase (VBP) will be officially opened on June 23, 2021.
The scale of China's rehabilitation therapy industry is growing rapidly.
Company news:News about the new ultrasound system and updated progress on drugs of Remegen Co Ltd (9995 HK), BeiGene Ltd (6160 HK), Shenzhen Mindray Bio-Medical Electronics (300760 CH) and Jiangsu Hengrui Medicine (600276 CH).Market review:Last week, stock price for healthcare sector in A share decreased 0.81%, while CSI 300 decreased 1.09% over the same period of time.Risk disclosure:Policy risk, R&amp;D risk, Company risk and COVID-19 risk.

Equity Bottom-Up

CStone Pharmaceuticals / Equity Bottom-Up

According to the official website, <a href="https://www.smartkarma.com/entities/cstone-pharmaceuticals" target="_blank" data-smartkarma-citation="entities:27882:1" rel="noopener">CStone Pharma (2616 HK)</a> announced that a registrational clinical trial (GEMSTONE-301 study) of the anti-PD-L1 monoclonal antibody sugemalimab in patients with stage III NSCLC met its primary endpoint at a planned interim analysis reviewed by the independent Data Monitoring Committee (iDMC). CStone plans to submit an NDA to the NMPA for sugemalimab in stage III NSCLC. Meanwhile, the phase III trial of sugemalimab as first-line treatment for stage IV squamous and non-squamous NSCLC met its primary endpoint in August 2020. An NDA for this indication was accepted by NMPA in November 2020, and CStone is expected to receive the NDA approval in the second half of 2021. Therefore, it is expected that sugemalimab would become the first anti-PD-1/PD-L1 monoclonal antibody in the world to cover both stage III and stage IV NSCLC patients. Together with the other three commercial launches in 2021 (pralsetinib, avapritinib and ivosidenib), it is the time to revalue the Company.

According to the official website, CStone Pharma (2616 HK) announced that a registrational clinical trial (GEMSTONE-301 study) of the anti-PD-L1 monoclonal antibody sugemalimab in patients with stage III NSCLC met its primary endpoint at a planned interim analysis reviewed by the independent Data Monitoring Committee (iDMC). CStone plans to submit an NDA to the NMPA for sugemalimab in stage III NSCLC. Meanwhile, the phase III trial of sugemalimab as first-line treatment for stage IV squamous and non-squamous NSCLC met its primary endpoint in August 2020. An NDA for this indication was accepted by NMPA in November 2020, and CStone is expected to receive the NDA approval in the second half of 2021. Therefore, it is expected that sugemalimab would become the first anti-PD-1/PD-L1 monoclonal antibody in the world to cover both stage III and stage IV NSCLC patients. Together with the other three commercial launches in 2021 (pralsetinib, avapritinib and ivosidenib), it is the time to revalue the Company.

CStone Pharma (2616.HK) - It Is the Time to Revalue the Company

Industry viewpoints:
<ul class="">
<li>China released a new policy to support couples having a third child as the population ages.</li>
<li>A joint procurement office on behalf of medical institutions in 12 provinces was formed to carry out centralized procurement of orthopedic trauma medical consumables.</li>
<li>With the increasing incidence of diseases that directly cause skull defects, the skull defect repair material industry in China has developed rapidly.</li>
</ul>
Company news:
News about the updated license-in agreement and new progress on drugs of <a href="https://www.smartkarma.com/entities/innovent-biologics-inc" target="_blank" data-smartkarma-citation="entities:27452:1" rel="noopener">Innovent Biologics Inc (1801 HK), </a><a href="https://www.smartkarma.com/entities/zai-lab-ltd" target="_blank" data-smartkarma-citation="entities:25877:1" rel="noopener">Zai Lab Ltd (ZLAB US)</a>, <a href="https://www.smartkarma.com/entities/cspc-pharmaceutical-group-ltd" target="_blank" data-smartkarma-citation="entities:229:1" rel="noopener">CSPC Pharmaceutical Group (1093 HK),</a> and <a href="https://www.smartkarma.com/entities/jiangsu-hengrui-medicine-co-ltd" target="_blank" data-smartkarma-citation="entities:14128:1" rel="noopener">Jiangsu Hengrui Medicine (600276 CH)</a>.
Market review: 
Last week, stock price for healthcare sector in A share increased 0.69%, while CSI 300 decreased 0.73% over the same period of time.
Risk disclosure:
Policy risk, R&amp;D risk, Company risk and COVID-19 risk.

Industry viewpoints:

China released a new policy to support couples having a third child as the population ages.
A joint procurement office on behalf of medical institutions in 12 provinces was formed to carry out centralized procurement of orthopedic trauma medical consumables.
With the increasing incidence of diseases that directly cause skull defects, the skull defect repair material industry in China has developed rapidly.

Company news:
News about the updated license-in agreement and new progress on drugs of Innovent Biologics Inc (1801 HK), Zai Lab Ltd (ZLAB US), CSPC Pharmaceutical Group (1093 HK), and Jiangsu Hengrui Medicine (600276 CH).
Market review: 
Last week, stock price for healthcare sector in A share increased 0.69%, while CSI 300 decreased 0.73% over the same period of time.
Risk disclosure:
Policy risk, R&amp;D risk, Company risk and COVID-19 risk.

Equity Capital Markets

Shanghai Haoyuan Chemexpress C / Equity Capital Markets

Recently, small market capitalization and undervalued CRO companies are favored by the market. For example, the most eye-catching rebound came from the <a href="https://www.smartkarma.com/entities/viva-biotech-holdings" target="_blank" data-smartkarma-citation="entities:27850:1" rel="noopener">Viva Biotech Holdings (1873 HK)</a> (up over 60% in May) and <a href="https://www.smartkarma.com/entities/hitgen-inc" target="_blank" data-smartkarma-citation="entities:30371:1" rel="noopener">HitGen Inc (688222 CH)</a> (up over 27% in May). In fact, the investment logic in CRO industry can be divided into two aspects: One is to invest in the leading companies with higher certainty, such as <a href="https://www.smartkarma.com/entities/wuxi-apptec-co-ltd-bf4a1265-beef-48b6-b82d-29308426030f" target="_blank" data-smartkarma-citation="entities:27795:1" rel="noopener">WuXi AppTec Co. Ltd. (2359 HK)</a>, <a href="https://www.smartkarma.com/entities/hangzhou-tigermed-consulting-co-ltd-1008d609-73bd-4d76-8315-b29502a448ff" target="_blank" data-smartkarma-citation="entities:29212:1" rel="noopener">Hangzhou Tigermed Consulting (H) (3347 HK)</a>, <a href="https://www.smartkarma.com/entities/pharmaron-beijing-co-ltd" target="_blank" data-smartkarma-citation="entities:28428:1" rel="noopener">Pharmaron Beijing Co Ltd-H (3759 HK)</a> and so on; The other is to pursue flexibility and choose to invest some targets that have made certain achievements in subdivision fields, such as the <a href="https://www.smartkarma.com/entities/viva-biotech-holdings" target="_blank" data-smartkarma-citation="entities:27850:1" rel="noopener">Viva Biotech Holdings (1873 HK)</a> and <a href="https://www.smartkarma.com/entities/hitgen-inc" target="_blank" data-smartkarma-citation="entities:30371:1" rel="noopener">HitGen Inc (688222 CH)</a> mentioned above. Here comes a new CRO/CDMO company that worth the attention, <a href="https://www.smartkarma.com/entities/shanghai-haoyuan-chemexpress" target="_blank" data-smartkarma-citation="entities:33415:1" rel="noopener">Shanghai Haoyuan Chemexpress (688131 CH)</a>, which will list on the SSE STAR Market soon. The following insight mainly analyzes the industry characteristics, business, financial performance and potential risks of the Company.

Recently, small market capitalization and undervalued CRO companies are favored by the market. For example, the most eye-catching rebound came from the Viva Biotech Holdings (1873 HK) (up over 60% in May) and HitGen Inc (688222 CH) (up over 27% in May). In fact, the investment logic in CRO industry can be divided into two aspects: One is to invest in the leading companies with higher certainty, such as WuXi AppTec Co. Ltd. (2359 HK), Hangzhou Tigermed Consulting (H) (3347 HK), Pharmaron Beijing Co Ltd-H (3759 HK) and so on; The other is to pursue flexibility and choose to invest some targets that have made certain achievements in subdivision fields, such as the Viva Biotech Holdings (1873 HK) and HitGen Inc (688222 CH) mentioned above. Here comes a new CRO/CDMO company that worth the attention, Shanghai Haoyuan Chemexpress (688131 CH), which will list on the SSE STAR Market soon. The following insight mainly analyzes the industry characteristics, business, financial performance and potential risks of the Company.

Pre-IPO Shanghai Haoyuan Chemexpress - A New CRO/CDMO with Continued High Growth Potential

Sihuan Pharmaceutical Hldgs / Equity Bottom-Up

Since 2021, if you want to ask which sector in the healthcare industry has outstanding performance, the medical beauty sector is definitely the one. Looking at the leading companies in this sector, the market cap and P/E ratio of <a href="https://www.smartkarma.com/entities/bloomage-biotechnology-corporation-a" target="_blank" data-smartkarma-citation="entities:30390:1" rel="noopener">Bloomage Biotechnology Corporation-A (688363 CH)</a> by the end of May 28, 2021 were RMB121 billion and 175, respectively. For <a href="https://www.smartkarma.com/entities/imeik-technology-development-co-ltd" target="_blank" data-smartkarma-citation="entities:32170:1" rel="noopener">Imeik Technology Development (300896 CH)</a>, they were RMB142 billion and 250, respectively. Both were at high end and very expensive. Here is another company, <a href="https://www.smartkarma.com/entities/sihuan-pharmaceutical-hldgs" target="_blank" data-smartkarma-citation="entities:33:1" rel="noopener">Sihuan Pharmaceutical Hldgs (460 HK)</a>, whose share price was up over 318% since the beginning of 2021 on the back of its medical beauty business, with market cap of HK$32.5 billion and P/E ratio of 57.17, which is pretty eye-catching. So could the medical beauty business revalue the Company? This insight mainly analyzed the business outlook and the concerns.

Since 2021, if you want to ask which sector in the healthcare industry has outstanding performance, the medical beauty sector is definitely the one. Looking at the leading companies in this sector, the market cap and P/E ratio of Bloomage Biotechnology Corporation-A (688363 CH) by the end of May 28, 2021 were RMB121 billion and 175, respectively. For Imeik Technology Development (300896 CH), they were RMB142 billion and 250, respectively. Both were at high end and very expensive. Here is another company, Sihuan Pharmaceutical Hldgs (460 HK), whose share price was up over 318% since the beginning of 2021 on the back of its medical beauty business, with market cap of HK$32.5 billion and P/E ratio of 57.17, which is pretty eye-catching. So could the medical beauty business revalue the Company? This insight mainly analyzed the business outlook and the concerns.

Sihuan Pharmaceutical (460.HK) - Optimistic in the Short Term but Conservative in the Long Term

China

Jiangsu Hengrui Medicine Co., Ltd. develops, manufactures, and markets a variety of medicines and medicine packing materials. The Company's products include anti-tumor medicines, pain-killers, anti-infection medicines, aluminum foil, and other related products.

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Jiangsu Hengrui Medicine (600276 CH)

China Healthcare Weekly (Jun.11)

The article analyzed the new document about centralized procurement of high-value consumables,the opening of bidding of 5th volume-based...

Xinyao (Criss) Wang

CStone Pharma (2616.HK) - It Is the Time to Revalue the Company

With the four commercial launches in 2021 (sugemalimab, pralsetinib, avapritinib and ivosidenib), it is the time to revalue CStone. This insight...

Xinyao (Criss) Wang

China Healthcare Weekly (Jun.4)

This insight mainly analyzed the three-child new policy, centralized procurement of orthopedic trauma medical consumables, skull defect repair...

Xinyao (Criss) Wang

Pre-IPO Shanghai Haoyuan Chemexpress - A New CRO/CDMO with Continued High Growth Potential

As CRO/CDMO continues to be a hot sector for investors and have outstanding performance, the new pre-IPO company Haoyuan Chemexpress with high...

Xinyao (Criss) Wang

Sihuan Pharmaceutical (460.HK) - Optimistic in the Short Term but Conservative in the Long Term

The medical beauty business outlook with high certainty is the main reason for the share price to rise three times this year.However, there are...

Xinyao (Criss) Wang

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