HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Thematic (Sector/Industry)

<ul>
<li>Due to the popularity of GLP-1 target, the entire GLP-1 upstream and downstream industry chain has received great enthusiasm. We analyzed related investment opportunities but also concerns in this market.  </li>
<li>Domestic CXOs should focus on securing orders for overseas weight loss drugs. The market value increment brought by weight loss drugs to CXO should be higher than that of APIs.</li>
<li>Due to increasing competition/potential price war, how big the real market space is uncertain. So, the market value increment of weight loss drugs business for pharmaceutical companies could be lower-than-expected.</li>
</ul>


Due to the popularity of GLP-1 target, the entire GLP-1 upstream and downstream industry chain has received great enthusiasm. We analyzed related investment opportunities but also concerns in this market.  
Domestic CXOs should focus on securing orders for overseas weight loss drugs. The market value increment brought by weight loss drugs to CXO should be higher than that of APIs.
Due to increasing competition/potential price war, how big the real market space is uncertain. So, the market value increment of weight loss drugs business for pharmaceutical companies could be lower-than-expected.


China's Weight Loss Drug Market – The Investment Opportunities and the Risks Behind

Equity Capital Markets

<ul>
<li>The sales growth of GLP-1s has entered a turning point. The actual market size of GLP-1s could be much lower-than-expected, which would affected the growth outlook of peptide CXOs.</li>
<li>Medtide is not strong as expected in the peptide CXOs industry. There's a “hidden problem” in terms of the market share ranking. We updated our forecast for the next three years.</li>
<li>Considering geopolitical conflicts/intense competition, it's difficult for Medtide to secure orders from industry leaders when the Company lacks competitiveness and are small in scale. Valuation should be lower than peers.</li>
</ul>


The sales growth of GLP-1s has entered a turning point. The actual market size of GLP-1s could be much lower-than-expected, which would affected the growth outlook of peptide CXOs.
Medtide is not strong as expected in the peptide CXOs industry. There's a “hidden problem” in terms of the market share ranking. We updated our forecast for the next three years.
Considering geopolitical conflicts/intense competition, it's difficult for Medtide to secure orders from industry leaders when the Company lacks competitiveness and are small in scale. Valuation should be lower than peers.


Pre-IPO Medtide (PHIP Updates) - Some Points Worth the Attention

<ul>
<li>Medtide relies heavily on limited number of customers to contribute performance. If there is any significant reduction in demand by its major customers, Medtide’s performance growth would be materially/adversely affected.</li>
<li>Due to geopolitical conflicts, pharmaceutical companies are becoming more cautious about their reliance on China CXO. So, the development of Medtide’s overseas business would become more uncertain in this context.</li>
<li>Medtide's business scale is still small and its position in the global peptide CXO industry is not as strong as described. Valuation of Medtide should be lower than peers.</li>
</ul>


Medtide relies heavily on limited number of customers to contribute performance. If there is any significant reduction in demand by its major customers, Medtide’s performance growth would be materially/adversely affected.
Due to geopolitical conflicts, pharmaceutical companies are becoming more cautious about their reliance on China CXO. So, the development of Medtide’s overseas business would become more uncertain in this context.
Medtide's business scale is still small and its position in the global peptide CXO industry is not as strong as described. Valuation of Medtide should be lower than peers.


Pre-IPO Medtide - The Industry, the Business and the Concerns

Event-Driven

<ul>
<li>Zadaxin is the biggest performance driver of SciClone. However, due to the challenge of generic drugs/VBP, sales of Zadaxin wouldn’t maintain strong growth momentum.  SciClone’s revenue/profit would face a significant decline.</li>
<li>The capital participating the IPO had reduced their holdings or exit entirely. Considering the low valuation/poor liquidity in HKEX, we think this privatization provides investors with a great exit opportunity.</li>
<li>For arbitrage investors, the annualized return depends on the time it takes to complete the privatization (e.g. about 5%-10%). If the privatization fails, share price could fall back to HK$14.</li>
</ul>


Zadaxin is the biggest performance driver of SciClone. However, due to the challenge of generic drugs/VBP, sales of Zadaxin wouldn’t maintain strong growth momentum.  SciClone’s revenue/profit would face a significant decline.
The capital participating the IPO had reduced their holdings or exit entirely. Considering the low valuation/poor liquidity in HKEX, we think this privatization provides investors with a great exit opportunity.
For arbitrage investors, the annualized return depends on the time it takes to complete the privatization (e.g. about 5%-10%). If the privatization fails, share price could fall back to HK$14.


Sciclone Pharmaceuticals (6600.HK) - The Privatization Offers a Good Exit Opportunity

<ul>
<li>While we’re optimistic about weight loss drug business, we also need to recognize the "true colors" of relevant companies, which helps us realize "when to participate and when to exit".</li>
<li>We analyzed the negatives/"flaws" of popular companies that favored by capital: <a href="https://www.smartkarma.com/entities/brightgene-bio-medical-technol" target="_blank" data-smartkarma-citation="entities:30356:1" rel="noopener">BrightGene Bio-Medical Technol (688166 CH)</a>, <a href="https://www.smartkarma.com/entities/hybio-pharmaceutical-co-ltd" target="_blank" data-smartkarma-citation="entities:20966:1" rel="noopener">Hybio Pharmaceutical (300199 CH)</a>, <a href="https://www.smartkarma.com/entities/hainan-poly-pharm-co-ltd" target="_blank" data-smartkarma-citation="entities:29739:1" rel="noopener">Hainan Poly Pharm (300630 CH), </a>Sinopep-Allsino, Kawin Technology, Highfine Biotech,etc.</li>
<li>Short-Term stock price rally are mainly driven by sentiment, but future valuation still needs to be supported by performance and fundamentals. Some companies are just conceptual hype in our view.</li>
</ul>


While we’re optimistic about weight loss drug business, we also need to recognize the "true colors" of relevant companies, which helps us realize "when to participate and when to exit".
We analyzed the negatives/"flaws" of popular companies that favored by capital: BrightGene Bio-Medical Technol (688166 CH), Hybio Pharmaceutical (300199 CH), Hainan Poly Pharm (300630 CH), Sinopep-Allsino, Kawin Technology, Highfine Biotech,etc.
Short-Term stock price rally are mainly driven by sentiment, but future valuation still needs to be supported by performance and fundamentals. Some companies are just conceptual hype in our view.


China’s China Weight Loss Drug Market Update – the Negatives and the True Colors

China

Hybio Pharmaceutical Co., Ltd. develops drug products. The Company manufactures and sells omeprazole sodium injection, somatostatin injection, desmopressin, antide, and other related products. Hybio Pharmaceutical also develops and sells medical testing products.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

Hybio Pharmaceutical (300199 CH)

China's Weight Loss Drug Market – The Investment Opportunities and the Risks Behind

The GLP-1 target has been recognized as a blockbuster target, which has attracted great enthusiasm from investors.We analyzed related investment...

Xinyao (Criss) Wang

Pre-IPO Medtide (PHIP Updates) - Some Points Worth the Attention

GLP-1 sales growth is at a turning point with market size potentially lower than expected, impacting growth outlook for peptide CXOs like Medtide....

Xinyao (Criss) Wang

Pre-IPO Medtide - The Industry, the Business and the Concerns

Medtide's growth is at risk due to high reliance on limited customers, uncertainty in overseas business and lower-than-expected position in global...

Xinyao (Criss) Wang

Sciclone Pharmaceuticals (6600.HK) - The Privatization Offers a Good Exit Opportunity

The success rate of privatization could be 70-80%. The time could be about six months. The annualized rate of return isn't attractive.It's up to...

Xinyao (Criss) Wang

China’s China Weight Loss Drug Market Update – the Negatives and the True Colors

Some popular companies are favored by capital on the back of enthusiasm for weight loss drugs, but sometimes it's just "conceptual hype". We need...

Xinyao (Criss) Wang

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

China's Weight Loss Drug Market – The Investment Opportunities and the Risks Behind

The GLP-1 target has been recognized as a blockbuster target, which has attracted great enthusiasm from investors.We analyzed related investment...

Xinyao (Criss) Wang

Pre-IPO Medtide (PHIP Updates) - Some Points Worth the Attention

​GLP-1 sales growth is at a turning point with market size potentially lower than expected, impacting growth outlook for peptide CXOs like Medtide....

Xinyao (Criss) Wang

Pre-IPO Medtide - The Industry, the Business and the Concerns

​Medtide's growth is at risk due to high reliance on limited customers, uncertainty in overseas business and lower-than-expected position in global...

Xinyao (Criss) Wang

Sciclone Pharmaceuticals (6600.HK) - The Privatization Offers a Good Exit Opportunity

The success rate of privatization could be 70-80%. The time could be about six months. The annualized rate of return isn't attractive.It's up to...

Xinyao (Criss) Wang

China’s China Weight Loss Drug Market Update – the Negatives and the True Colors

Some popular companies are favored by capital on the back of enthusiasm for weight loss drugs, but sometimes it's just "conceptual hype". We need...

Xinyao (Criss) Wang

GLP-1 sales growth is at a turning point with market size potentially lower than expected, impacting growth outlook for peptide CXOs like Medtide....

Medtide's growth is at risk due to high reliance on limited customers, uncertainty in overseas business and lower-than-expected position in global...