HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Equity Bottom-Up

Jiangsu Hengrui Medicine / Equity Bottom-Up

<ul>
<li>The 2021 report is the worst ever annual report of Hengrui, with double drop in both revenue and net profit.2021Q4 and 2022Q1 are also the worst two quarters so far.</li>
<li>Although Hengrui has invested heavily in R&amp;D and internationalization, it’s still trying to follow an established model with better security.Essentially, Hengrui is still the same Hengrui. Nothing has changed fundamentally. </li>
<li>For now, Hengrui hasn’t released any signal for “a reversal”. If going bottom fishing, investors may have to take a long, uncertain journey with Hengrui. Can you afford to wait?</li>
</ul>


The 2021 report is the worst ever annual report of Hengrui, with double drop in both revenue and net profit.2021Q4 and 2022Q1 are also the worst two quarters so far.
Although Hengrui has invested heavily in R&amp;D and internationalization, it’s still trying to follow an established model with better security.Essentially, Hengrui is still the same Hengrui. Nothing has changed fundamentally. 
For now, Hengrui hasn’t released any signal for “a reversal”. If going bottom fishing, investors may have to take a long, uncertain journey with Hengrui. Can you afford to wait?


Jiangsu Hengrui Medicine (600276.CH) 2021/2022Q1 Results - Can You Afford to Wait?

Thematic (Sector/Industry)

<ul>
<li>The development trajectory of Japanese pharmaceutical companies could be a good reference for Chinese pharmaceutical companies. Their “solution” is innovation + internationalization.</li>
<li>We further analyzed the impact of Shanghai lockdown to Pharma and CXOs. In the context of intensifying global confrontation, resource shortage and soaring costs, the priority of healthcare may decline.</li>
<li>At the current stage, biotech companies could be divided into the following categories, and it is very interesting.</li>
</ul>


The development trajectory of Japanese pharmaceutical companies could be a good reference for Chinese pharmaceutical companies. Their “solution” is innovation + internationalization.
We further analyzed the impact of Shanghai lockdown to Pharma and CXOs. In the context of intensifying global confrontation, resource shortage and soaring costs, the priority of healthcare may decline.
At the current stage, biotech companies could be divided into the following categories, and it is very interesting.


China Healthcare Weekly (Apr.29)-SH Lockdown Impact on Pharma/CXO,China Biotech Categories & Way Out

<ul>
<li>Due to its early involvement in license-in mode, Zai Lab could in-license many high-quality candidates at a low price in the early stage, thus leading to today's achievements.</li>
<li>However, the increasingly low cost performance of in-licensed products has made the capital “reconsider”, because it is increasingly difficult to maintain high growth as before based on license-in mode.</li>
<li>Zai Lab could be a good short-term trade,especially when it reaches licensing deals or launch new products,but doubts about long-term prospects could discourages investors from holding it for long term.</li>
</ul>


Due to its early involvement in license-in mode, Zai Lab could in-license many high-quality candidates at a low price in the early stage, thus leading to today's achievements.
However, the increasingly low cost performance of in-licensed products has made the capital “reconsider”, because it is increasingly difficult to maintain high growth as before based on license-in mode.
Zai Lab could be a good short-term trade,especially when it reaches licensing deals or launch new products,but doubts about long-term prospects could discourages investors from holding it for long term.


Zai Lab Ltd (ZLAB.US/9688.HK) - Will Zai Lab Go into a Vicious Circle?

<ul>
<li>According to NHSA and NHC’s new documents, the charging principle of joint replacement surgical robots is stipulated. With more hospitals introducing surgical robots,the commercialization prospects of this area becomes clearer.</li>
<li>Senate blesses bill to boost American competitiveness and curb its reliance on China for critical supplies, such as APIs. However, it may not be so easy to solve.</li>
<li>The sequela of COVID-19 could become a public health problem that cannot be ignored. For companies, instead of developing COVID-19 vaccines/drugs, entering COVID recovery market could be a good strategy.</li>
</ul>


According to NHSA and NHC’s new documents, the charging principle of joint replacement surgical robots is stipulated. With more hospitals introducing surgical robots,the commercialization prospects of this area becomes clearer.
Senate blesses bill to boost American competitiveness and curb its reliance on China for critical supplies, such as APIs. However, it may not be so easy to solve.
The sequela of COVID-19 could become a public health problem that cannot be ignored. For companies, instead of developing COVID-19 vaccines/drugs, entering COVID recovery market could be a good strategy.


China Healthcare Weekly (Apr.8)-Surgical Robots Pricing Rules,America COMPETES Act,COVID-19 Sequelae

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Periscope Analytics

Periscope Analytics focuses on event-driven trades across Asia Pacific and provides comprehensive, timely and systematic coverage of index changes to major Asia Pacific indices in a structured manner.

The analysis includes forecasted inclusions and exclusions to all major Asian indices that have significant amount of tracking assets, including estimates of passive buy/sell flow on the stocks. The service also provides commentary and impact of market consultations, ground rule changes, and other events (IPOs, spin-offs, M&A) that could lead to index changes and passive flow.

Periscope Analytics works with multi-strategy hedge funds, proprietary trading firms, stat arb trading groups and long-only investors that invest and trade in the Asia Pacific region with the data being used to trade index rebalances, avoid pre-positioning and passive flow, and to time entry into and exit from stocks.

Event-Driven Trades Across Asia Pacific

Event-Driven

Orient Overseas International / Event-Driven

<ul>
<li>Current at 66 constituents, we expect to reach 80 <a href="https://www.smartkarma.com/entities/hong-kong-hang-seng-index" target="_blank" data-smartkarma-citation="entities:22899:1" rel="noopener">HSI INDEX</a> constituents by the end of the year before moving higher towards 100 index members in 2023.</li>
<li>We list 10 stocks that could be added to the index in June - with one-way turnover close to 6%, the actual number of inclusions will be lower.</li>
<li>We also list out another 8 stocks that could possibly be added in June, though the probability of a September/ December inclusion is higher.</li>
</ul>


Current at 66 constituents, we expect to reach 80 HSI INDEX constituents by the end of the year before moving higher towards 100 index members in 2023.
We list 10 stocks that could be added to the index in June - with one-way turnover close to 6%, the actual number of inclusions will be lower.
We also list out another 8 stocks that could possibly be added in June, though the probability of a September/ December inclusion is higher.


HSI Index Rebalance Preview: Will The Pace of Inclusions Pick Up?

China

Innovent Biologics, Inc. operates as a biopharmaceutical company. The Company develops, manufactures, and distributes monoclonal antibody drug candidates for the treatment of oncology, ophthalmology, autoimmune, cardiovascular, and other diseases. Innovent Biologics serves customers in China.

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Innovent Biologics Inc (1801 HK)

Jiangsu Hengrui Medicine (600276.CH) 2021/2022Q1 Results - Can You Afford to Wait?

Hengrui's 2021, 2021Q4 and 2022Q1 reports are the worst ever. We updated our views on possible future development trajectory of Hengrui's...

Xinyao (Criss) Wang

China Healthcare Weekly (Apr.29)-SH Lockdown Impact on Pharma/CXO,China Biotech Categories & Way Out

We analyzed the impact of lockdown to Pharma and CXO, worrying the priority of healthcare may decline.China biotech can be divided into some...

Xinyao (Criss) Wang

Zai Lab Ltd (ZLAB.US/9688.HK) - Will Zai Lab Go into a Vicious Circle?

Due to increasing cost and potential legal risks, relying on license-in mode is not as glamorous as before.The transition to independent R&D takes...

Xinyao (Criss) Wang

China Healthcare Weekly (Apr.8)-Surgical Robots Pricing Rules,America COMPETES Act,COVID-19 Sequelae

The pricing rules of NHSA/NHC offer clearer outlook for surgical robots;The America COMPETES Act to curb reliance on China's APIs could be...

Xinyao (Criss) Wang

HSI Index Rebalance Preview: Will The Pace of Inclusions Pick Up?

There could be 5-6 inclusions to the HSI in June as part of the move to 80 members. We list 10 stocks that could be added to the index, and another...

Brian Freitas

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