HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Thematic (Sector/Industry)

<ul>
<li>Ukraine "miraculously" turned the tide of war, making Russia to consider whether they’re facing Ukraine or the Pentagon/NATO? There could be "entry of new members". The balance could tilt again.</li>
<li>The Russia-Ukraine war is also a cruel world economic war. We analyzed the impact on healthcare industry (both opportunities and challenges).</li>
<li>Overall, the first episode of the Russia-Ukraine war has ended and entered a serious new phase. The game between the US and Russia would last for a long time.</li>
</ul>


Ukraine "miraculously" turned the tide of war, making Russia to consider whether they’re facing Ukraine or the Pentagon/NATO? There could be "entry of new members". The balance could tilt again.
The Russia-Ukraine war is also a cruel world economic war. We analyzed the impact on healthcare industry (both opportunities and challenges).
Overall, the first episode of the Russia-Ukraine war has ended and entered a serious new phase. The game between the US and Russia would last for a long time.


Russia-Ukraine War Episode 2 - The Balance Could Tilt Again and Its Impact on Healthcare Industry

<ul>
<li>It is estimated that a large number of biotech companies will be liquidated or willing to be acquired at low prices starting from the second half of 2023.</li>
<li>If strictly speaking, the so-called import substitution is not really good logic, but investors need to know "when to participate in this story" and "when to exit".</li>
<li>Economic downturn would lead to consumption downgrade. We suggest that investors temporarily avoid medical companies with consumption attributes, since we have concerns on their performance.</li>
</ul>


It is estimated that a large number of biotech companies will be liquidated or willing to be acquired at low prices starting from the second half of 2023.
If strictly speaking, the so-called import substitution is not really good logic, but investors need to know "when to participate in this story" and "when to exit".
Economic downturn would lead to consumption downgrade. We suggest that investors temporarily avoid medical companies with consumption attributes, since we have concerns on their performance.


China Healthcare Weekly (Oct.7)- Biotech Accept Reality, Import Substitution Logic, Consumer Medical

Equity Capital Markets

<ul>
<li>AIM needs to rely on both human rabies vaccine and HBV vaccine to contribute majority revenue,but the outlook is challenging. Their revenue would decline due to competition and product upgrading.</li>
<li>Most of AIM’s vaccine candidates are in early development stages. There’re many competing candidates in more advanced development stages.The pipeline lacks competitiveness and it's hard to generate forecasted profits.</li>
<li>Although the issue price is discounted significantly, AIM is still overvalued. Reducing the size of IPO to maintain a good share price doesn’t work. When investors exit,accumulated pressure will explode.</li>
</ul>


AIM needs to rely on both human rabies vaccine and HBV vaccine to contribute majority revenue,but the outlook is challenging. Their revenue would decline due to competition and product upgrading.
Most of AIM’s vaccine candidates are in early development stages. There’re many competing candidates in more advanced development stages.The pipeline lacks competitiveness and it's hard to generate forecasted profits.
Although the issue price is discounted significantly, AIM is still overvalued. Reducing the size of IPO to maintain a good share price doesn’t work. When investors exit,accumulated pressure will explode.


Pre-IPO AIM Vaccine - AIM Is Overvalued, with Uncompetitive Pipeline and Challenging Outlook

<ul>
<li>NHSA will set aside a certain market to provide space for innovative medical devices/consumables to explore the market in addition to centralized procurement. However, we tend to be cautiously optimistic.</li>
<li>We think it is important to clarify for investors what constitutes "commercialization success" – That is to generate revenue at scale and stable profitability through the sale of drugs.</li>
<li>All the products that covered by VBP begin to lose logic. Don't be fooled by those positive interpretations. We are bearish on the sectors with downward logic in long cycle. </li>
</ul>


NHSA will set aside a certain market to provide space for innovative medical devices/consumables to explore the market in addition to centralized procurement. However, we tend to be cautiously optimistic.
We think it is important to clarify for investors what constitutes "commercialization success" – That is to generate revenue at scale and stable profitability through the sale of drugs.
All the products that covered by VBP begin to lose logic. Don't be fooled by those positive interpretations. We are bearish on the sectors with downward logic in long cycle. 


China Healthcare Weekly(Sep9)-Innovative Device Policy,Commercial Success Definition,Don't Be Fooled

Equity Bottom-Up

<ul>
<li>CanSino’s performance declined in 22H1 due to decreased demand of COVID-19 vaccine. Since we have analyzed our concerns on performance in prior insight, there should be psychological expectations for the decline.</li>
<li>The COVID-19 vaccine business brings CanSino rich cash flow and helps it establish commercial team. Together with MCV2/MCV4/mRNA/PCV13i, it's too early to be completely bearish on CanSino.</li>
<li>The market has exaggerated the impact of performance decline of COVID-19 vaccine on CanSino. Although 2022 is a difficult year, it is a good time to bottom fish this stock.</li>
</ul>


CanSino’s performance declined in 22H1 due to decreased demand of COVID-19 vaccine. Since we have analyzed our concerns on performance in prior insight, there should be psychological expectations for the decline.
The COVID-19 vaccine business brings CanSino rich cash flow and helps it establish commercial team. Together with MCV2/MCV4/mRNA/PCV13i, it's too early to be completely bearish on CanSino.
The market has exaggerated the impact of performance decline of COVID-19 vaccine on CanSino. Although 2022 is a difficult year, it is a good time to bottom fish this stock.


CanSino Biologics (6185.HK/688185.CH) 2022H1 - It's Too Early to Be Completely Bearish on CanSino

China

Chongqing Zhifei Biological Products Company Ltd. researches, manufactures, and sells vaccines and biological products including prevention products, blood products, diagnostic reagents, and therapeutic agents.

Chongqing Zhifei Biological Products (300122 CH)

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Chongqing Zhifei Biological Products (300122 CH)

Russia-Ukraine War Episode 2 - The Balance Could Tilt Again and Its Impact on Healthcare Industry

The first episode of Russia-Ukraine war has ended and entered a new phase.As it becomes "small world war",the balance may tilt again. It's also a...

Xinyao (Criss) Wang

China Healthcare Weekly (Oct.7)- Biotech Accept Reality, Import Substitution Logic, Consumer Medical

Although unwilling, biotech will face the harshest truth in 2023; Import substitution isn't good logic. Investors should know "when to join" &...

Xinyao (Criss) Wang

Pre-IPO AIM Vaccine - AIM Is Overvalued, with Uncompetitive Pipeline and Challenging Outlook

AIM's products/pipeline are lack of competitiveness due to fierce competition and product upgrading, with gloomy outlook. Although the issue price...

Xinyao (Criss) Wang

China Healthcare Weekly(Sep9)-Innovative Device Policy,Commercial Success Definition,Don't Be Fooled

We recommend cautiously optimistic about new innovative device policy. It's important to clarify what constitutes "commercialization success". All...

Xinyao (Criss) Wang

CanSino Biologics (6185.HK/688185.CH) 2022H1 - It's Too Early to Be Completely Bearish on CanSino

The market has exaggerated the impact of performance decline of COVID-19 vaccine on CanSino. Although 2022 is a difficult year, considering MCV2...

Xinyao (Criss) Wang

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52-week Range

Market Cap (USDm)

P/E

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