HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Equity Bottom-Up

<ul>
<li>The 9th national VBP is drawing near. As all drugs under national/provincial VBP are scheduled to be executed before 2025/12/31, there should be new policies in 2026 and beyond.</li>
<li>The capabilities of Chinese pharmaceutical companies in ADC field have at least stepped onto a platform to compete with international giants, which is clearly more progressive than during PD-1 era.</li>
<li>We analyzed key points of Ovctek. Its investment logic has changed and centralized procurement will break investors' expectations for Ovctek’s future performance growth. Valuation may continue to be under pressure.</li>
</ul>


The 9th national VBP is drawing near. As all drugs under national/provincial VBP are scheduled to be executed before 2025/12/31, there should be new policies in 2026 and beyond.
The capabilities of Chinese pharmaceutical companies in ADC field have at least stepped onto a platform to compete with international giants, which is clearly more progressive than during PD-1 era.
We analyzed key points of Ovctek. Its investment logic has changed and centralized procurement will break investors' expectations for Ovctek’s future performance growth. Valuation may continue to be under pressure.


China Healthcare Weekly (May.26)- 9th National VBP, China's Strength in ADC Field, Ovctek, Eyebright

Global Healthcare Analyst

Tina Banerjee

Thematic (Sector/Industry)

<ul>
<li>As we are heading into 2023, let us look back on the performance of some of our global healthcare stocks recommended throughout 2022.</li>
<li>Four stocks on which I am bullish, generated more than 50% return since their recommendations. 10 stocks on which I am bearish plunged more than 20%.</li>
<li>For 2023, investors should continue to focus on established healthcare companies, having strong and flexible balance sheet with muti-year revenue visibility.</li>
</ul>


As we are heading into 2023, let us look back on the performance of some of our global healthcare stocks recommended throughout 2022.
Four stocks on which I am bullish, generated more than 50% return since their recommendations. 10 stocks on which I am bearish plunged more than 20%.
For 2023, investors should continue to focus on established healthcare companies, having strong and flexible balance sheet with muti-year revenue visibility.


2022 in Rear Mirror View: Top Performers From My Global Healthcare Coverage Universe

Asia Pac IPO & Placement Research, China biotech, Aequitas Research

Ke Yan, CFA, FRM

Asia Pac IPO & Placement Research, China biotech

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Quantitative Analysis

<ul>
<li>We analyze the weekly Hong Kong Connect flows with our data engine for holding position as of December 9th.</li>
<li>The top stocks by inflows and outflows were tabulated for all market, HSCEI, mid cap and s/mid cap groups.</li>
<li>We highlight inflows into HKEx, Ping An H&amp;T, and outflows from Tencent, Xiaomi, Li Ning, Meituan, Country Garden Service.</li>
</ul>


We analyze the weekly Hong Kong Connect flows with our data engine for holding position as of December 9th.
The top stocks by inflows and outflows were tabulated for all market, HSCEI, mid cap and s/mid cap groups.
We highlight inflows into HKEx, Ping An H&amp;T, and outflows from Tencent, Xiaomi, Li Ning, Meituan, Country Garden Service.


Hong Kong Connect Flows (Dec 9th): HKEx, Ping An H&T, Tencent, Xiaomi, Li Ning, Meituan

Yichang HEC Changjiang Pharma / Equity Bottom-Up

<ul>
<li>During H1 2022, <a href="https://www.smartkarma.com/entities/yichang-hec-changjiang-pharmaceutical" target="_blank" data-smartkarma-citation="entities:21040:1" rel="noopener">Yichang HEC Changjiang Pharma (1558 HK)</a> recorded revenue of RMB1.3 billion, representing 540% y/y growth, driven by 1,776% y/y revenue growth from its core product Kewei.</li>
<li>With gradual recovery of patient traffic in medical institutions and increasing number of flu cases, Kewei showed a trend of recovery in its sales volume leveraging on its market leadership.</li>
<li>HEC Pharma has a comprehensive insulin portfolio, which covers both second and third generations of insulin. With 116 million diabetes patients, China has significant market opportunity for insulin.</li>
</ul>


During H1 2022, Yichang HEC Changjiang Pharma (1558 HK) recorded revenue of RMB1.3 billion, representing 540% y/y growth, driven by 1,776% y/y revenue growth from its core product Kewei.
With gradual recovery of patient traffic in medical institutions and increasing number of flu cases, Kewei showed a trend of recovery in its sales volume leveraging on its market leadership.
HEC Pharma has a comprehensive insulin portfolio, which covers both second and third generations of insulin. With 116 million diabetes patients, China has significant market opportunity for insulin.


HEC Pharma (1558 HK): Core Product Saw Volume Recovery in 1H 2022; New Launches to Accelerate Growth

<ul>
<li>HEC Pharma (1558 HK) launched multiple new products, which will reduce its over-dependence on a single drug. Among those, insulin and oral HCV drug have large market opportunities in China.</li>
<li>As of 30 June 2021, 11 products of the company have won the bid for centralized bulk purchase of drugs, including six products have won the bid in H1 2021.</li>
<li>HEC’s rich pipeline consists of 50 innovative class 1 drugs, targeting fast-growing therapeutic areas including oncology. Its late-stage pipeline will enable robust product launches in 2022 and beyond.</li>
</ul>


HEC Pharma (1558 HK) launched multiple new products, which will reduce its over-dependence on a single drug. Among those, insulin and oral HCV drug have large market opportunities in China.
As of 30 June 2021, 11 products of the company have won the bid for centralized bulk purchase of drugs, including six products have won the bid in H1 2021.
HEC’s rich pipeline consists of 50 innovative class 1 drugs, targeting fast-growing therapeutic areas including oncology. Its late-stage pipeline will enable robust product launches in 2022 and beyond.


Yichang HEC Changjiang Pharma (1558 HK): Multiple New Products Launches Bring New Opportunities

Hong Kong

YiChang HEC ChangJiang Pharmaceutical Co Ltd develops a variety of drugs.  The Company develops and sells drugs for anti-virus, metabolic diseases, cardiovascular, and more.

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Yichang HEC Changjiang Pharma (1558 HK)

China Healthcare Weekly (May.26)- 9th National VBP, China's Strength in ADC Field, Ovctek, Eyebright

The 9th national VBP is coming, but policy could change from 2026.We see positive factors in the performance of Chinese company in ADC field, who...

Xinyao (Criss) Wang

2022 in Rear Mirror View: Top Performers From My Global Healthcare Coverage Universe

From my coverage universe, two Taiwanese stocks generated 59% and 71% returns in nearly six months. New product launch and geography expansion are...

Tina Banerjee

Hong Kong Connect Flows (Dec 9th): HKEx, Ping An H&T, Tencent, Xiaomi, Li Ning, Meituan

We analyzed southbound Hong Kong connect flows in the past week and highlight flows for HKEx, Ping An H&T, Tencent, Xiaomi, Li Ning, Meituan,...

Ke Yan, CFA, FRM

HEC Pharma (1558 HK): Core Product Saw Volume Recovery in 1H 2022; New Launches to Accelerate Growth

HEC Pharma’s revenue jumped ~6x in 1H22, driven by volume recovery of its core drug Kewei. Going ahead, new generic launches and insulin portfolio...

Tina Banerjee

Yichang HEC Changjiang Pharma (1558 HK): Multiple New Products Launches Bring New Opportunities

HEC Pharm is on a new growth path through the launch of diabetes and oral HCV drugs. The company has a rich pipeline of innovative drugs, entailing...

Tina Banerjee

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