HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Equity Bottom-Up

<ul>
<li>The medical insurance fund has crossed certain “warning lines”. Therefore, it is inevitable that the measures to control costs at the expenditure end will be further tightened.</li>
<li>We are actually not optimistic about the NewCo model, because domestic pharmaceutical companies may not necessarily be able to share much of Newco's future development achievements in the end.</li>
<li>BeiGene’s 25Q3 results beat expectations. However, there’s no next blockbuster that can drive BeiGene to a big step forward, this is why the market is reluctant to offer higher valuation.</li>
</ul>


The medical insurance fund has crossed certain “warning lines”. Therefore, it is inevitable that the measures to control costs at the expenditure end will be further tightened.
We are actually not optimistic about the NewCo model, because domestic pharmaceutical companies may not necessarily be able to share much of Newco's future development achievements in the end.
BeiGene’s 25Q3 results beat expectations. However, there’s no next blockbuster that can drive BeiGene to a big step forward, this is why the market is reluctant to offer higher valuation.


China Healthcare Weekly (Nov.9)-Medical Insurance “Warning Lines”, NewCo Model, BeiGene 25Q3 Results

Global Healthcare Analyst

Tina Banerjee

Thematic (Sector/Industry)

<ul>
<li>Takeda has dropped AstraZeneca-partnered antibody drug candidate from its pipeline. Eisai and Merck are closing late-stage trial of Lenvima plus Keytruda in hepatocellular carcinoma on disappointing result.</li>
<li>Wuxi AppTec sharpens CRDMO business by selling its China-based clinical research subsidiaries. FDA has designated Celltrion’s Stoboclo and Osenvelt as interchangeable biosimilars to the reference products Prolia and Xgeva, respectively.</li>
<li>CSL is delaying demerger of CSL Seqirus ‘to maximise shareholder value.’ PharmaEssentia has filed for the additional indication of Besremi for Essential Thrombocythemia (ET) with the FDA.</li>
</ul>


Takeda has dropped AstraZeneca-partnered antibody drug candidate from its pipeline. Eisai and Merck are closing late-stage trial of Lenvima plus Keytruda in hepatocellular carcinoma on disappointing result.
Wuxi AppTec sharpens CRDMO business by selling its China-based clinical research subsidiaries. FDA has designated Celltrion’s Stoboclo and Osenvelt as interchangeable biosimilars to the reference products Prolia and Xgeva, respectively.
CSL is delaying demerger of CSL Seqirus ‘to maximise shareholder value.’ PharmaEssentia has filed for the additional indication of Besremi for Essential Thrombocythemia (ET) with the FDA.


APAC Healthcare Weekly (November 2) – Takeda, Eisai, Wuxi AppTec, Celltrion, CSL, PharmaEssentia

Asia Pac IPO & Placement Research, China biotech, Aequitas Research

Ke Yan, CFA, FRM

Asia Pac IPO & Placement Research, China biotech

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Quantitative Analysis

<ul>
<li>We analyze the weekly Hong Kong Connect flows with our data engine for holding position as of October 24th.</li>
<li>The top stocks by inflows and outflows were tabulated for all market, HSCEI, mid cap and s/mid cap groups.</li>
<li>We highlight flows for Alibaba, CNOOC, Pop Mart Intl, Duality Biotherapeutics, China Mobile, Meituan, SMIC, Laopu Gold.</li>
</ul>


We analyze the weekly Hong Kong Connect flows with our data engine for holding position as of October 24th.
The top stocks by inflows and outflows were tabulated for all market, HSCEI, mid cap and s/mid cap groups.
We highlight flows for Alibaba, CNOOC, Pop Mart Intl, Duality Biotherapeutics, China Mobile, Meituan, SMIC, Laopu Gold.


HK Connect Flows Weekly (Oct 24th): Alibaba, CNOOC, Pop Mart Intl, Duality Biotherapeutics

<ul>
<li>We analyze the weekly Hong Kong Connect flows with our data engine for holding position as of October 17th.</li>
<li>The top stocks by inflows and outflows were tabulated for all market, HSCEI, mid cap and s/mid cap groups.</li>
<li>We highlight flows for SMIC, Alibaba, Xiaomi, Tencent, Pop Mart Intl, China Mobile, Meituan, Innovent Biologics, ICBC, Wuxi Biologics.</li>
</ul>


We analyze the weekly Hong Kong Connect flows with our data engine for holding position as of October 17th.
The top stocks by inflows and outflows were tabulated for all market, HSCEI, mid cap and s/mid cap groups.
We highlight flows for SMIC, Alibaba, Xiaomi, Tencent, Pop Mart Intl, China Mobile, Meituan, Innovent Biologics, ICBC, Wuxi Biologics.


HK Connect Flows Weekly (Oct 17th): SMIC, Alibaba, Xiaomi, Tencent, Pop Mart Intl, China Mobile

Ping An Healthcare and Technology / Equity Bottom-Up

<ul>
<li>The “turning point” occurs as share price of innovative drug sector is pulling back. Many companies would see valuations halved - potentially more than once.The decline is far from over.</li>
<li>The current main goal of biotech is to turn losses into profits ASAP. If it fails to make a profit, it may not be recognized by the market.</li>
<li>Due to the concerns on <a href="https://www.smartkarma.com/entities/ping-an-healthcare-and-technology-company-limited" target="_blank" data-smartkarma-citation="entities:27008:1" rel="noopener">Ping An Healthcare and Technology (1833 HK)'s </a>business model, peak revenue scale could be just RMB8 billion. In other words, Ping An Healthcare is overvalued.</li>
</ul>


The “turning point” occurs as share price of innovative drug sector is pulling back. Many companies would see valuations halved - potentially more than once.The decline is far from over.
The current main goal of biotech is to turn losses into profits ASAP. If it fails to make a profit, it may not be recognized by the market.
Due to the concerns on Ping An Healthcare and Technology (1833 HK)'s business model, peak revenue scale could be just RMB8 billion. In other words, Ping An Healthcare is overvalued.


China Healthcare Weekly (Oct.19)-Bubble of HK Biotech Is Bursting, Ping An Good Doctor Is Overvalued

China

BeiGene, Ltd. operates as a commercial stage biopharmaceutical company. The Company focuses on discovery, development, and commercialization of molecularly targeted and immuno-oncology drugs for the treatment of cancer. BeiGene serves patients worldwide.

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BeOne (ONC US)

China Healthcare Weekly (Nov.9)-Medical Insurance “Warning Lines”, NewCo Model, BeiGene 25Q3 Results

Cost control measure of medical insurance fund to be tightened.Domestic drug company won't benefit from NewCo model.Despite BeiGene's strong Q3...

Xinyao (Criss) Wang

APAC Healthcare Weekly (November 2) – Takeda, Eisai, Wuxi AppTec, Celltrion, CSL, PharmaEssentia

Takeda and Eisai witnessed clinical trials setback. Wuxi AppTec is selling China-based CRO subsidiaries. CSL is delaying demerger of CSL Seqirus....

Tina Banerjee

HK Connect Flows Weekly (Oct 24th): Alibaba, CNOOC, Pop Mart Intl, Duality Biotherapeutics

We analyzed southbound Hong Kong connect flows in the past week and highlighted flows for Alibaba, CNOOC, Pop Mart Intl, Duality Biotherapeutics,...

Ke Yan, CFA, FRM

HK Connect Flows Weekly (Oct 17th): SMIC, Alibaba, Xiaomi, Tencent, Pop Mart Intl, China Mobile

We analyzed southbound Hong Kong connect flows in the past week and highlighted flows for SMIC (981 HK), Alibaba (9988 HK), Xiaomi (1810 HK),...

Ke Yan, CFA, FRM

China Healthcare Weekly (Oct.19)-Bubble of HK Biotech Is Bursting, Ping An Good Doctor Is Overvalued

Innovative drug sector facing share price decline, companies at risk of halved valuations multiple times.The main goal of biotech is to turn...

Xinyao (Criss) Wang

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52-week Range

Market Cap (USDm)

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China Healthcare Weekly (Nov.9)-Medical Insurance “Warning Lines”, NewCo Model, BeiGene 25Q3 Results

Cost control measure of ​medical insurance fund to be tightened.Domestic drug company won't benefit from NewCo model.Despite BeiGene's strong Q3...

Xinyao (Criss) Wang

APAC Healthcare Weekly (November 2) – Takeda, Eisai, Wuxi AppTec, Celltrion, CSL, PharmaEssentia

Takeda and Eisai witnessed clinical trials setback. Wuxi AppTec is selling China-based CRO subsidiaries. CSL is delaying demerger of CSL Seqirus....

Tina Banerjee

HK Connect Flows Weekly (Oct 24th): Alibaba, CNOOC, Pop Mart Intl, Duality Biotherapeutics

We analyzed southbound Hong Kong connect flows in the past week and highlighted flows for Alibaba, CNOOC, Pop Mart Intl, Duality Biotherapeutics,...

Ke Yan, CFA, FRM

HK Connect Flows Weekly (Oct 17th): SMIC, Alibaba, Xiaomi, Tencent, Pop Mart Intl, China Mobile

We analyzed southbound Hong Kong connect flows in the past week and highlighted flows for SMIC (981 HK), Alibaba (9988 HK), Xiaomi (1810 HK),...

Ke Yan, CFA, FRM

China Healthcare Weekly (Oct.19)-Bubble of HK Biotech Is Bursting, Ping An Good Doctor Is Overvalued

​Innovative drug sector facing share price decline, companies at risk of halved valuations multiple times.The main goal of biotech is to turn...

Xinyao (Criss) Wang

Cost control measure of medical insurance fund to be tightened.Domestic drug company won't benefit from NewCo model.Despite BeiGene's strong Q3...

Innovative drug sector facing share price decline, companies at risk of halved valuations multiple times.The main goal of biotech is to turn...