Asian Hedge Fund Manager, Long Short Equity, Macro

David Mudd

Cross Asset Strategy

<ul>
<li>The Hong Kong Alpha portfolio gained 5.79% in July, outperforming its benchmark by 0.30%.  The portfolio has outperformed Hong Kong indexes by 52% to 74% since inception.</li>
<li>The portfolio's largest exposures are in the industrial, financial, and technology platform sectors. The portfolio has no exposure to the materials or energy sectors.</li>
<li>The portfolio has generated a Sharpe ratio of 1.20 since inception, compared with 0.69 for the benchmark.  The portfolio's annualized mean excess return is 19.4%.</li>
</ul>


The Hong Kong Alpha portfolio gained 5.79% in July, outperforming its benchmark by 0.30%.  The portfolio has outperformed Hong Kong indexes by 52% to 74% since inception.
The portfolio's largest exposures are in the industrial, financial, and technology platform sectors. The portfolio has no exposure to the materials or energy sectors.
The portfolio has generated a Sharpe ratio of 1.20 since inception, compared with 0.69 for the benchmark.  The portfolio's annualized mean excess return is 19.4%.


Thematic (Sector/Industry)

<ul>
<li>China's AI-driven drug discovery (AIDD) sector is growing rapidly, with leading drug and biotech companies entering R&amp;D and drug-development partnerships with global pharmaceutical companies.</li>
<li>Over 30% of new drugs were developed using AI tools in 2025, with discovery timelines reduced by 25–50%, and the industry is projected to grow by 25%/year through 2033.</li>
<li>
<a href="https://www.smartkarma.com/entities/insilico-medicine-cayman-topco" target="_blank" data-smartkarma-citation="entities:39890:1" rel="noopener">Insilico Medicine (3696 HK)</a> is a pure-play AIDD company. Insilico operates an end-to-end AI drug discovery platform (Pharma.AI) spanning target identification, molecule generation, and clinical trial outcome prediction. 
</li>
</ul>


China's AI-driven drug discovery (AIDD) sector is growing rapidly, with leading drug and biotech companies entering R&amp;D and drug-development partnerships with global pharmaceutical companies.
Over 30% of new drugs were developed using AI tools in 2025, with discovery timelines reduced by 25–50%, and the industry is projected to grow by 25%/year through 2033.

Insilico Medicine (3696 HK) is a pure-play AIDD company. Insilico operates an end-to-end AI drug discovery platform (Pharma.AI) spanning target identification, molecule generation, and clinical trial outcome prediction. 



Healthcare Analyst

Wilfred Yuen

<ul>
<li>
Wuxi Apptec 2Q26 results beat on strong QoQ growth in TIDES. BeOne 2Q26 results driven by robust Brukinsa revenue (+14% QoQ to USD1.2bn). Zai 2Q26 +11% QoQ in product revenue</li>
<li>
Innovent robust 2Q26 product revenue +60% YoY (or +13% QoQ) to RMB4.3bn; RemeGen 1H26 results preview: strong revenue growth + turnaround in profit; Alphamab licensed-out TROP2/HER3 ADC to Pathos AI.</li>
<li>Other updates include Hengrui, Wuxi Biologics, Metis Techbio, CSPC, and Akeso.</li>
</ul>



Wuxi Apptec 2Q26 results beat on strong QoQ growth in TIDES. BeOne 2Q26 results driven by robust Brukinsa revenue (+14% QoQ to USD1.2bn). Zai 2Q26 +11% QoQ in product revenue

Innovent robust 2Q26 product revenue +60% YoY (or +13% QoQ) to RMB4.3bn; RemeGen 1H26 results preview: strong revenue growth + turnaround in profit; Alphamab licensed-out TROP2/HER3 ADC to Pathos AI.
Other updates include Hengrui, Wuxi Biologics, Metis Techbio, CSPC, and Akeso.


HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Equity Bottom-Up

<ul>
<li>The 11th national VBP officially started last week. The average price reduction of the selected products is 53%. Due to the "anchor price" mechanism, VBP is becoming increasingly rational.</li>
<li>The purchasing power of the global pharmaceutical industry on Chinese assets is still far from saturated that we have reason to expect more transactions to come to Chinese pharmaceutical companies.</li>
<li>Based on WuXi AppTec’s 25Q3 results, CDMO business has emerged from fundamental turning point following the recovery of overseas biotech industry, but the inflection point of CRO is lagging behind.</li>
</ul>


The 11th national VBP officially started last week. The average price reduction of the selected products is 53%. Due to the "anchor price" mechanism, VBP is becoming increasingly rational.
The purchasing power of the global pharmaceutical industry on Chinese assets is still far from saturated that we have reason to expect more transactions to come to Chinese pharmaceutical companies.
Based on WuXi AppTec’s 25Q3 results, CDMO business has emerged from fundamental turning point following the recovery of overseas biotech industry, but the inflection point of CRO is lagging behind.


China Healthcare Weekly (Nov.2) - 11th National VBP, More BD Deal to Come, WuXi AppTec 25Q3 Results

External broker reports(aggregated public sources), CMB International

CMB International

External broker reports(aggregated public sources)

Incorporated in Hong Kong, supported by the mainland and targeting in global market, CMB International Capital Corporation Limited (“CMBI”) is an integrated financial institution providing comprehensive and professional services. As a wholly-owned subsidiary of China Merchants Bank ("CMB"), by leveraging on the Group’s synergy and coordination in domestic and overseas markets, as well as CMB’s strong resources and outstanding social reputation, CMBI and its subsidiaries have been actively implementing diversified business strategies and set up an overall layout of main business segments including Corporate Finance, Asset Management, Wealth Management, Global Markets and Structured Finance, etc. Adhering to the philosophy of “being clients oriented and increasing our own values by the way of creating value for clients”, CMBI endeavors to provide quality and integrated financial services to institutional, corporate and individual customers both domestic and overseas including Hong Kong IPO sponsorship and underwriting, share placement and rights issue for listed companies, financial advisors, bonds issuance services, asset management, direct investment, wealth management, equity sales and trading, etc.

<ul><li>WuXi AppTec reported strong 3Q25 results, with revenue increasing by 15.3% YoY (including 19.7% YoY growth for continuing operations) and adj. non-IFRS net profit surging by 42.0% YoY.</li><li>Revenue from continuing operations in 9M25 accounted for 73.8% of our full-year forecast, in line with historical average of 72%, while adj. non-IFRS net profit in 9M25 represented 85.7% of our full-year forecast, significant higher than the historical average of 72%.</li><li>WuXi AppTec delivered strong operational execution, despite ongoing macro uncertainties. </li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

WuXi AppTec reported strong 3Q25 results, with revenue increasing by 15.3% YoY (including 19.7% YoY growth for continuing operations) and adj. non-IFRS net profit surging by 42.0% YoY.Revenue from continuing operations in 9M25 accounted for 73.8% of our full-year forecast, in line with historical average of 72%, while adj. non-IFRS net profit in 9M25 represented 85.7% of our full-year forecast, significant higher than the historical average of 72%.WuXi AppTec delivered strong operational execution, despite ongoing macro uncertainties. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

WuXi AppTec (603259 CH) - Rising Demand for Small Molecule D&M Business

China

WuXi AppTec is a global contract research, development, and manufacturing organization (CRDMO) for the pharmaceutical and life sciences industries. It provides integrated, end-to-end services including chemistry drug CRDMO, biology discovery, preclinical testing, and clinical research services for various therapeutic modalities. The company was founded in 2000 and is headquartered in Shanghai, China.

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WuXi AppTec (2359 HK)

HONG KONG ALPHA PORTFOLIO: (July 2026)

We made several adjustments to the portfolio yesterday. We sold the Baidu (9888) position since it hit our stop-loss level. We also sold the...

David Mudd

CHINA/HK: AI & RX - Together At Last !!

China's AI-driven drug discovery (AIDD) sector is growing rapidly, with leading drug and biotech companies entering R&D and drug-development...

David Mudd

China Healthcare Weekly Wrap (3-7 Aug)

Wuxi Apptec 2Q results beat; BeOne 2Q driven by robust Brukinsa; Innovent robust 2Q product revenue +13% QoQ; Alphamab licensed-out TROP2/HER3 ADC...

Wilfred Yuen

China Healthcare Weekly (Nov.2) - 11th National VBP, More BD Deal to Come, WuXi AppTec 25Q3 Results

"Anchor price" mechanism in 11th VBP leads to increased rationality.MNCs' interest in China assets not yet saturated, more deals expected.WuXi...

Xinyao (Criss) Wang

WuXi AppTec (603259 CH) - Rising Demand for Small Molecule D&M Business

WuXi AppTec reported strong 3Q25 results, with revenue increasing by 15.3% YoY (including 19.7% YoY growth for continuing operations) and adj. non...

CMB International

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