HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Thematic (Sector/Industry)

<ul>
<li>The executive meeting of State Council has indicated the future direction of China healthcare industry- With the expansion of the VBP scope, the traditional sales mode will be hit hard.</li>
<li>The pricing system of innovative drugs in national medical insurance negotiation has its logic actually. It could provide enterprises with reasonable profits, but not significant profits or exponential growth.</li>
<li>The approval results of FDA on products of <a href="https://www.smartkarma.com/entities/legend-biotech-corp" target="_blank" data-smartkarma-citation="entities:28963:1" rel="noopener">Legend Biotech (LEGN US)</a> and Junshi could allow investors to have a better judgment on the logic of internationalization of domestic innovative drugs.</li>
</ul>


The executive meeting of State Council has indicated the future direction of China healthcare industry- With the expansion of the VBP scope, the traditional sales mode will be hit hard.
The pricing system of innovative drugs in national medical insurance negotiation has its logic actually. It could provide enterprises with reasonable profits, but not significant profits or exponential growth.
The approval results of FDA on products of Legend Biotech (LEGN US) and Junshi could allow investors to have a better judgment on the logic of internationalization of domestic innovative drugs.


China Healthcare Weekly (Feb.18)-VBP Expansion, China Drug Pricing System,FDA Approval,Junshi/Legend

<ul>
<li>In 2021/1H, the neuro-interventional industry attracted great enthusiasm from investors, but starting from 2021/2H, things began to change and investors quickly returned to rationality.</li>
<li>The major concerns are the product homogenization, fierce market competition and the negative impact of centralized procurement policy. We summarized our policy interpretation to help investors make a prediction.</li>
<li>In terms of future trends, the grassroots market and the international markets are the breakthrough points for domestic neuro-interventional enterprises, which would be the main criteria for decision-making.</li>
</ul>


In 2021/1H, the neuro-interventional industry attracted great enthusiasm from investors, but starting from 2021/2H, things began to change and investors quickly returned to rationality.
The major concerns are the product homogenization, fierce market competition and the negative impact of centralized procurement policy. We summarized our policy interpretation to help investors make a prediction.
In terms of future trends, the grassroots market and the international markets are the breakthrough points for domestic neuro-interventional enterprises, which would be the main criteria for decision-making.


Concerns and Outlook on China Neuro-Interventional Industry

<ul>
<li>While the final results of 2021 national medical insurance negotiation have yet to be announced, here are what's circulating in the market.</li>
<li>The centralized procurement on spring coil in Hebei province would start soon, which means that the centralized procurement in the field of neuro-intervention in China has officially begun.</li>
<li>There is a phenomenon of "valuation upside down" in the primary and secondary market of healthcare investment, so we recommend investors to be more cautious and rational.</li>
</ul>


While the final results of 2021 national medical insurance negotiation have yet to be announced, here are what's circulating in the market.
The centralized procurement on spring coil in Hebei province would start soon, which means that the centralized procurement in the field of neuro-intervention in China has officially begun.
There is a phenomenon of "valuation upside down" in the primary and secondary market of healthcare investment, so we recommend investors to be more cautious and rational.


China Healthcare Weekly (Nov.12)-Medical Insurance Negotiation,Spring Coil VBP,Valuation Upside Down

Industry viewpoints:<ul>
<li>The recent centralized procurement on spring coil in Hebei province could be a warning to the relevant enterprises.</li>
<li>The NHSA pointed out that it will explore feasible ways to include dental items into the payment scope of commercial insurance.</li>
<li>We expect to see AI deeply integrated into the new drug development process and revolutionize the industry in the future.</li>
</ul>Company news:News about the updated progress on new drugs and cooperation agreement of <a href="https://www.smartkarma.com/entities/akeso-biopharma-inc" target="_blank" data-smartkarma-citation="entities:28830:1" rel="noopener">Akeso Biopharma Inc (9926 HK)</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/everest-medicines-ltd" target="_blank" data-smartkarma-citation="entities:29224:1" rel="noopener">Everest Medicines (1952 HK)</a>. Market review:Last week, stock price for healthcare sector in A share increased 3.74%, while CSI 300 decreased 0.37% over the same period of time.Risk disclosure:Policy risk, R&amp;D risk, Company risk and COVID-19 risk.

Industry viewpoints:
The recent centralized procurement on spring coil in Hebei province could be a warning to the relevant enterprises.
The NHSA pointed out that it will explore feasible ways to include dental items into the payment scope of commercial insurance.
We expect to see AI deeply integrated into the new drug development process and revolutionize the industry in the future.
Company news:News about the updated progress on new drugs and cooperation agreement of Akeso Biopharma Inc (9926 HK), CSPC Pharmaceutical Group (1093 HK) and Everest Medicines (1952 HK). Market review:Last week, stock price for healthcare sector in A share increased 3.74%, while CSI 300 decreased 0.37% over the same period of time.Risk disclosure:Policy risk, R&amp;D risk, Company risk and COVID-19 risk.

China Healthcare Weekly (Sep.24) - VBP on Neuro-Intervention, Payment System Changes, AI in Drug R&D

Industry Viewpoints:<ul>
<li>The 5th national volume-based purchase (VBP) was officially launched.</li>
<li>In 2020, China's pharmaceutical and life sciences industry disclosed 928 deals worth US$43 billion, up about 73% YoY.</li>
<li>The market is quite concerned about whether the healthcare sector would enter a new round of policy regulation period, but we think it may not.</li>
</ul>Company News:News about the updated progress on drugs and medical devices of <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>, <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/peijia-medical" target="_blank" data-smartkarma-citation="entities:28862:1" rel="noopener">Peijia Medical (9996 HK).</a>Market Review:Last week, stock price for healthcare sector in A share increased 6.29%, while CSI 300 increased 3.41% over the same period of time.Risk Disclosure:Policy risk, R&amp;D risk, Company risk and COVID-19 risk.

Industry Viewpoints:
The 5th national volume-based purchase (VBP) was officially launched.
In 2020, China's pharmaceutical and life sciences industry disclosed 928 deals worth US$43 billion, up about 73% YoY.
The market is quite concerned about whether the healthcare sector would enter a new round of policy regulation period, but we think it may not.
Company News:News about the updated progress on drugs and medical devices of Jiangsu Hengrui Medicine (600276 CH), CSPC Pharmaceutical Group (1093 HK) and Peijia Medical (9996 HK).Market Review:Last week, stock price for healthcare sector in A share increased 6.29%, while CSI 300 increased 3.41% over the same period of time.Risk Disclosure:Policy risk, R&amp;D risk, Company risk and COVID-19 risk.

China

Peijia Medical is a China-based company specializing in the research, development, and manufacturing of high-end interventional medical devices. It provides comprehensive treatment solutions for structural heart diseases, including transcatheter aortic valve replacement (TAVR) systems, and neurovascular diseases with various neurointerventional devices. The company was founded in 2012 and is headquartered in Suzhou, China.

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Peijia Medical (9996 HK)

China Healthcare Weekly (Feb.18)-VBP Expansion, China Drug Pricing System,FDA Approval,Junshi/Legend

We analyzed the VBP scope expansion and logic of drug pricing system in medical insurance negotiation.FDA's attitude on Legend Bio&Junshi's...

Xinyao (Criss) Wang

Concerns and Outlook on China Neuro-Interventional Industry

The insight analyzed China neuro-interventional industry including the reason of cool-down in primary market, the product homogenization, fierce...

Xinyao (Criss) Wang

China Healthcare Weekly (Nov.12)-Medical Insurance Negotiation,Spring Coil VBP,Valuation Upside Down

This insight mainly analyzed some news circulating about 2021 national medical insurance negotiation results, VBP on spring coil in Hebei and...

Xinyao (Criss) Wang

China Healthcare Weekly (Sep.24) - VBP on Neuro-Intervention, Payment System Changes, AI in Drug R&D

This article analyzed the centralized procurement on spring coil in Hebei province, commercial insurance coverage for dental items, AI in new drug...

Xinyao (Criss) Wang

China Healthcare Weekly (Apr.23)

This article analyzed the 5th national volume-based purchase, China's pharmaceutical and life sciences deals in 2020, potential policy impact on...

Xinyao (Criss) Wang

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