HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Equity Capital Markets

Hangzhou Jiuyuan Gene Engineering / Equity Capital Markets

<ul>
<li>Based on current performance, Jiuyuan has lost growth momentum, showing signs of stagnant growth. The main reason is VBP. So far, Jiouting, Yinuojia, Jifuwei have been included in VBP.</li>
<li>Guyoudao is facing competitive pressure from both domestic and international competitors and could be finally included in VBP. JY29-2 is the next blockbuster product, but the prospects are not clear.</li>
<li>Jiuyuan’s market value is expected to be higher than Qyuns. Future valuation performance will depend on the progress of JY29-2 and the overall market situation of GLP-1s at that time</li>
</ul>


Based on current performance, Jiuyuan has lost growth momentum, showing signs of stagnant growth. The main reason is VBP. So far, Jiouting, Yinuojia, Jifuwei have been included in VBP.
Guyoudao is facing competitive pressure from both domestic and international competitors and could be finally included in VBP. JY29-2 is the next blockbuster product, but the prospects are not clear.
Jiuyuan’s market value is expected to be higher than Qyuns. Future valuation performance will depend on the progress of JY29-2 and the overall market situation of GLP-1s at that time


Pre-IPO Hangzhou Jiuyuan Gene Engineering (PHIP Updates) - The Future Prospects Are Not Optimistic

Qyuns Therapeutics / Equity Capital Markets

<ul>
<li>The sales scale of drugs for autoimmune diseases in China is much lower than that in overseas markets. So, internationalization is inevitable for companies in this industry.</li>
<li>Qyuns’s candidates have to face fierce competition, with no advantage in R&amp;D progress.Since Qyuns mainly do clinical trials in China, its future valuation is hard to have big expansion potential.</li>
<li>Many investors may still “live in the illusion” for China biotech. We think Qyuns would not finally transform into a biopharma. Its valuation should be lower than Keymed.</li>
</ul>


The sales scale of drugs for autoimmune diseases in China is much lower than that in overseas markets. So, internationalization is inevitable for companies in this industry.
Qyuns’s candidates have to face fierce competition, with no advantage in R&amp;D progress.Since Qyuns mainly do clinical trials in China, its future valuation is hard to have big expansion potential.
Many investors may still “live in the illusion” for China biotech. We think Qyuns would not finally transform into a biopharma. Its valuation should be lower than Keymed.


Pre-IPO Qyuns Therapeutics - Conservative About the Outlook

Equity Bottom-Up

Huadong Medicine Co Ltd A / Equity Bottom-Up

<ul>
<li>We have discovered something interesting from the innovative drug evaluations disclosed by the NMPA over the years. It’s recommended to establish rational expectations for the investment return of biopharmaceutical industry.</li>
<li>We analyzed the different situations faced by Biotech in IPO/M&amp;A process, so as to help investors make rational judgments. R&amp;D team is likely to be cut regardless of the circumstances.</li>
<li>We updated views on Huadong. Its old businesses dragged down valuation. It may need to wait until Huadong delivers better-than-expected sales/profit growth in weight-loss management business before further boosting valuation.</li>
</ul>


We have discovered something interesting from the innovative drug evaluations disclosed by the NMPA over the years. It’s recommended to establish rational expectations for the investment return of biopharmaceutical industry.
We analyzed the different situations faced by Biotech in IPO/M&amp;A process, so as to help investors make rational judgments. R&amp;D team is likely to be cut regardless of the circumstances.
We updated views on Huadong. Its old businesses dragged down valuation. It may need to wait until Huadong delivers better-than-expected sales/profit growth in weight-loss management business before further boosting valuation.


China Healthcare Weekly (Sep.29) - Be Rational About Biotech Investment, R&D Team Layoffs, Huadong

The United Laboratories International Holdings Limited / Equity Capital Markets

The United Laboratories International Holdings Limited

<ul>
<li>Last year, United Lab mainly relied on antibiotics to make money. However, after the pandemic is under control, antibiotic sales may decline. United Lab’s performance could be under pressure.</li>
<li>As a late comer, sales of United Lab’s weight management products could be lower than expected in the future under increasing competition. The veterinary drugs business requires time to cultivate.</li>
<li>RMB12 billion market value of United Lab has priced in all positive factors.There could be a pullback in valuation. RMB6 billion market value is a safe place to go long.</li>
</ul>


Last year, United Lab mainly relied on antibiotics to make money. However, after the pandemic is under control, antibiotic sales may decline. United Lab’s performance could be under pressure.
As a late comer, sales of United Lab’s weight management products could be lower than expected in the future under increasing competition. The veterinary drugs business requires time to cultivate.
RMB12 billion market value of United Lab has priced in all positive factors.There could be a pullback in valuation. RMB6 billion market value is a safe place to go long.


United Laboratories International Holdings Placement (3933.HK) - Valuation Pullback Seems Inevitable

Thematic (Sector/Industry)

<ul>
<li>The anti-corruption campaign has significantly accelerated since the beginning of this year. After Central Commission for Discipline Inspection has been involved, the anti-corruption efforts in pharmaceutical/device sectors would be unprecedented.</li>
<li>The main targets are leaders of hospitals/governments. The impact of anti-corruption on companies is indirect. As long as senior management are not investigated/arrested, the impact on stock price isn’t significant.</li>
<li>However, investors not only need to consider the problem of sales growth slowing down in the context of anti-corruption, but also consider whether companies is engaging in financial fraud. </li>
</ul>


The anti-corruption campaign has significantly accelerated since the beginning of this year. After Central Commission for Discipline Inspection has been involved, the anti-corruption efforts in pharmaceutical/device sectors would be unprecedented.
The main targets are leaders of hospitals/governments. The impact of anti-corruption on companies is indirect. As long as senior management are not investigated/arrested, the impact on stock price isn’t significant.
However, investors not only need to consider the problem of sales growth slowing down in the context of anti-corruption, but also consider whether companies is engaging in financial fraud. 


Anti-Corruption in China Healthcare – the Impact and the Outlook

China

Huadong Medicine Co., Ltd. wholesales and retails medicines, pharmaceutical preparations, biological products, and medical instruments.  Through its subsidiaries, the Company also manufactures antibiotic medicines and biochemical products.

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Huadong Medicine Co Ltd A (000963 CH)

Pre-IPO Hangzhou Jiuyuan Gene Engineering (PHIP Updates) - The Future Prospects Are Not Optimistic

Jiuyuan's growth momentum is stalling due to VBP. Guyoudao and JY29-2 face competition and uncertainty. Market value may surpass Qyuns. Future...

Xinyao (Criss) Wang

Pre-IPO Qyuns Therapeutics - Conservative About the Outlook

Qyuns’s pipeline lacks competitiveness, facing fierce competition.Together with bleak internationalization outlook, peak sales have obvious...

Xinyao (Criss) Wang

China Healthcare Weekly (Sep.29) - Be Rational About Biotech Investment, R&D Team Layoffs, Huadong

It’s advised to establish rational expectation for Biotech's investment return. R&D team will be cut eventually during M&A/IPO. Huadong's valuation...

Xinyao (Criss) Wang

United Laboratories International Holdings Placement (3933.HK) - Valuation Pullback Seems Inevitable

United Lab is facing a performance decline when the dividend period of the pandemic has subsided. Weight management/veterinary drug businesses have...

Xinyao (Criss) Wang

Anti-Corruption in China Healthcare – the Impact and the Outlook

The share prices of China healthcare are now plummeting due to anti-corruption campaign, which will reach a climax in 23H2 (We'll post updates in...

Xinyao (Criss) Wang

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Pre-IPO Hangzhou Jiuyuan Gene Engineering (PHIP Updates) - The Future Prospects Are Not Optimistic

​Jiuyuan's growth momentum is stalling due to VBP. Guyoudao and JY29-2 face competition and uncertainty. Market value may surpass Qyuns. Future...

Xinyao (Criss) Wang

Pre-IPO Qyuns Therapeutics - Conservative About the Outlook

Qyuns’s pipeline lacks competitiveness, facing fierce competition.Together with bleak internationalization outlook, peak sales have obvious...

Xinyao (Criss) Wang

China Healthcare Weekly (Sep.29) - Be Rational About Biotech Investment, R&D Team Layoffs, Huadong

It’s advised to establish rational expectation for Biotech's investment return. R&D team will be cut eventually during M&A/IPO. Huadong's valuation...

Xinyao (Criss) Wang

United Laboratories International Holdings Placement (3933.HK) - Valuation Pullback Seems Inevitable

United Lab is facing a performance decline when the dividend period of the pandemic has subsided. Weight management/veterinary drug businesses have...

Xinyao (Criss) Wang

Anti-Corruption in China Healthcare – the Impact and the Outlook

The share prices of China healthcare are now plummeting due to anti-corruption campaign, which will reach a climax in 23H2 (We'll post updates in...

Xinyao (Criss) Wang

Jiuyuan's growth momentum is stalling due to VBP. Guyoudao and JY29-2 face competition and uncertainty. Market value may surpass Qyuns. Future...