HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Thematic (Sector/Industry)

On December 28th 2020, the National Healthcare Security Administration (NHSA) announced the results of 2020 medical insurance negotiations. The new medical insurance catalogue will be officially implemented on March 1st, 2021. It totally contains 2,800 types of drugs, including 1,426 types of western medicine and 1,374 types of proprietary Chinese medicine. A total of 162 drugs were negotiated this time, 119 of which successfully won the bidding, with a success rate of 73.46% and an average price reduction of 50.64%. The list of the 119 drugs is on the final page.

On December 28th 2020, the National Healthcare Security Administration (NHSA) announced the results of 2020 medical insurance negotiations. The new medical insurance catalogue will be officially implemented on March 1st, 2021. It totally contains 2,800 types of drugs, including 1,426 types of western medicine and 1,374 types of proprietary Chinese medicine. A total of 162 drugs were negotiated this time, 119 of which successfully won the bidding, with a success rate of 73.46% and an average price reduction of 50.64%. The list of the 119 drugs is on the final page.

China Healthcare Policy Update - The Official Results of 2020 Medical Insurance Negotiations

1. Industry viewpoints:<ul>
<li>Last week, the National Healthcare Security Administration (NHSA) announced the results of 2020 medical insurance negotiations. </li>
<li>The negotiations results showed that all three domestic PD-1/L1 had successfully won the bidding to be included in the medical insurance.</li>
<li>Transdermal drug delivery systems (TDDS) is a hot research direction of improved new drugs, among which cataplasm has great development potential.</li>
</ul>2. Company news: News about the progress of new drugs and results of 2020 medical insurance negotiations from <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/jiangsu-hengrui-medicine-co-ltd" target="_blank" data-smartkarma-citation="entities:14128:1" rel="noopener">Jiangsu Hengrui Medicine (600276 CH)</a> and <a href="https://www.smartkarma.com/entities/hutchison-china-meditech-ltd-7c2c4b58-ca71-4ac4-befb-345e8d0f10ca" target="_blank" data-smartkarma-citation="entities:27342:1" rel="noopener">Hutchison China MediTech Ltd (HCM US).</a>3. Market review:Last week, stock price for healthcare sector in A share increased 0.33%, while CSI 300 increased 3.36% over the same period of time.4. Risk Disclosure:Policy risk, R&amp;D risk, Company risk and COVID-19 risk.

1. Industry viewpoints:
Last week, the National Healthcare Security Administration (NHSA) announced the results of 2020 medical insurance negotiations. 
The negotiations results showed that all three domestic PD-1/L1 had successfully won the bidding to be included in the medical insurance.
Transdermal drug delivery systems (TDDS) is a hot research direction of improved new drugs, among which cataplasm has great development potential.
2. Company news: News about the progress of new drugs and results of 2020 medical insurance negotiations from Innovent Biologics Inc (1801 HK), Jiangsu Hengrui Medicine (600276 CH) and Hutchison China MediTech Ltd (HCM US).3. Market review:Last week, stock price for healthcare sector in A share increased 0.33%, while CSI 300 increased 3.36% over the same period of time.4. Risk Disclosure:Policy risk, R&amp;D risk, Company risk and COVID-19 risk.

First of all, Merry Christmas and Happy New Year!
1. Industry viewpoints:
<ul>
<li>While we are still waiting for the official results of the volume-based purchase (VBP) negotiations in 2020, let’s take a further look at the competitive landscape of PD-1/L1 in China.</li>
<li>The regenerative medical implant devices would be a development trend of medical implant devices in the future.</li>
<li>Affected by the centralized procurement policy in China, the growth rate of high-value medical consumables market is expected to slow year by year.</li>
</ul>
2. Company news:
News about the progress of new drugs from <a href="https://www.smartkarma.com/entities/alphamab-oncology" target="_blank" data-smartkarma-citation="entities:28213:1" rel="noopener">Alphamab Co Ltd (9966 HK)</a>, <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/ascletis-pharma-inc" target="_blank" data-smartkarma-citation="entities:27265:1" rel="noopener">Ascletis Pharma Inc (1672 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>.
3. Market review:
Last week, stock price for healthcare sector in A share increased 1.1%, while CSI 300 increased 0.84% over the same period of time.
4. Risk Disclosure:
Policy risk, R&amp;D risk, Company risk and COVID-19 risk.

First of all, Merry Christmas and Happy New Year!
1. Industry viewpoints:

While we are still waiting for the official results of the volume-based purchase (VBP) negotiations in 2020, let’s take a further look at the competitive landscape of PD-1/L1 in China.
The regenerative medical implant devices would be a development trend of medical implant devices in the future.
Affected by the centralized procurement policy in China, the growth rate of high-value medical consumables market is expected to slow year by year.

2. Company news:
News about the progress of new drugs from Alphamab Co Ltd (9966 HK), Innovent Biologics Inc (1801 HK), Ascletis Pharma Inc (1672 HK) and Jiangsu Hengrui Medicine (600276 CH).
3. Market review:
Last week, stock price for healthcare sector in A share increased 1.1%, while CSI 300 increased 0.84% over the same period of time.
4. Risk Disclosure:
Policy risk, R&amp;D risk, Company risk and COVID-19 risk.

1. Industry viewpoints:<ul>
<li>Last week, the negotiations of volume-based purchase 2020 came to a close, and the bidding of PD-1/L1 was the most eye-catching.</li>
<li>In the future, with the rapid release of radiotherapy equipment in China, the penetration rate of radiotherapy is expected to be accelerated.</li>
<li>The use of traditional Chinese medicine in hospital is facing severe challenges.</li>
</ul>2. Company news:News about the updated progress of new drugs and cooperation from <a href="https://www.smartkarma.com/entities/ascletis-pharma-inc" target="_blank" data-smartkarma-citation="entities:27265:1" rel="noopener">Ascletis Pharma Inc (1672 HK)</a>, <a href="https://www.smartkarma.com/entities/harbour-biomed-holdings-limited" target="_blank" data-smartkarma-citation="entities:29717:1" rel="noopener">Harbour Biomed (2142 HK)</a> and <a href="https://www.smartkarma.com/entities/luye-pharma-group-ltd" target="_blank" data-smartkarma-citation="entities:488:1" rel="noopener">Luye Pharma (2186 HK)</a>.3. Market review:Last week, stock price for healthcare sector in A share increased 4.25%, while CSI 300 increased 2.26% over the same period of time.4. Risk Disclosure:Policy risk, R&amp;D risk, Company risk and COVID-19 risk.

1. Industry viewpoints:
Last week, the negotiations of volume-based purchase 2020 came to a close, and the bidding of PD-1/L1 was the most eye-catching.
In the future, with the rapid release of radiotherapy equipment in China, the penetration rate of radiotherapy is expected to be accelerated.
The use of traditional Chinese medicine in hospital is facing severe challenges.
2. Company news:News about the updated progress of new drugs and cooperation from Ascletis Pharma Inc (1672 HK), Harbour Biomed (2142 HK) and Luye Pharma (2186 HK).3. Market review:Last week, stock price for healthcare sector in A share increased 4.25%, while CSI 300 increased 2.26% over the same period of time.4. Risk Disclosure:Policy risk, R&amp;D risk, Company risk and COVID-19 risk.

Equity Bottom-Up

Livzon Pharmaceutical Group In / Equity Bottom-Up

<a href="https://www.smartkarma.com/entities/livzon-pharmaceutical-group-a" target="_blank" data-smartkarma-citation="entities:24770:1" rel="noopener">Livzon Pharmaceutical Group-A (000513 CH)</a> released its third quarter report in 2020. The Q1-Q3 accumulated revenue was RMB7.926 billion, with a YoY growth rate of 8.64%. Net income attributed to shareholders in the first three quarters was RMB1.422 billion, up 36.71% YoY. Net income after deducting non-recurring gains and losses were RMB1.179 billion, up 23.15% YoY. Q3 single quarter revenue was RMB2.83 billion, up 20.14% YoY. Net income attributed to shareholders reached RMB417 million, up 38.52% YoY. Q3’s single quarter net income after deducting non-recurring gains and losses was RMB344 million, up 15.28% YoY. Q3 performance was above expectations, with the highest YoY growth rate in the single quarter in nearly three years, and demonstrated strong recovery in various sectors.<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/175/696/original/image_32979984121606785555504.png?1606785557" class="editor-image img-responsive" data-smartkarma-image-id="175696"></figure>Source: WIND

Livzon Pharmaceutical Group-A (000513 CH) released its third quarter report in 2020. The Q1-Q3 accumulated revenue was RMB7.926 billion, with a YoY growth rate of 8.64%. Net income attributed to shareholders in the first three quarters was RMB1.422 billion, up 36.71% YoY. Net income after deducting non-recurring gains and losses were RMB1.179 billion, up 23.15% YoY. Q3 single quarter revenue was RMB2.83 billion, up 20.14% YoY. Net income attributed to shareholders reached RMB417 million, up 38.52% YoY. Q3’s single quarter net income after deducting non-recurring gains and losses was RMB344 million, up 15.28% YoY. Q3 performance was above expectations, with the highest YoY growth rate in the single quarter in nearly three years, and demonstrated strong recovery in various sectors.Source: WIND

Livzon Pharmaceutical (000513.CH) - A Good Company that You Can't Afford Missing

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)

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This article analyzed Livzon's R&D highlights, main products and pipelines, financial position, and made forecast and rating for the Company.

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