HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Equity Capital Markets

<ul>
<li>Vancocin/Ceclor/FPN are currently the “cash cow” for Edding, but they’re facing the challenges of generics, VBP and increasing competition. Their current market leading position may be lost in the future.</li>
<li>Edding seeks business transformation as its CSO model doesn’t work under domestic negative policies. But peak sales of three innovative drugs Vascepa/Mulpleta/EDP 125 may not reach the level of Vancocin/Ceclor.</li>
<li>Edding’s core advantage still lies in sales capabilities. Its R&amp;D capabilities have always been questioned. It’s unsure whether the market would give high valuation to a company without core competitiveness.</li>
</ul>


Vancocin/Ceclor/FPN are currently the “cash cow” for Edding, but they’re facing the challenges of generics, VBP and increasing competition. Their current market leading position may be lost in the future.
Edding seeks business transformation as its CSO model doesn’t work under domestic negative policies. But peak sales of three innovative drugs Vascepa/Mulpleta/EDP 125 may not reach the level of Vancocin/Ceclor.
Edding’s core advantage still lies in sales capabilities. Its R&amp;D capabilities have always been questioned. It’s unsure whether the market would give high valuation to a company without core competitiveness.


Pre-IPO Edding Group - CSO Model Is Hard to Sustain, but Business Transformation Faces Challenges

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

<ul>
<li>Hang Seng has announced the conclusions of the market consultation. Primary-listed foreign stocks will be eligible for inclusion in the <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> and <a href="https://www.smartkarma.com/entities/hang-seng-tech-index" target="_blank" data-smartkarma-citation="entities:31367:1" rel="noopener">HSTECH INDEX</a> from the December rebalance.</li>
<li>The coming week has the rebalances for the <a href="https://www.smartkarma.com/entities/nifty-index" target="_blank" data-smartkarma-citation="entities:23617:1" rel="noopener">NIFTY Index</a>, <a href="https://www.smartkarma.com/entities/nse-nifty-next-50-index" target="_blank" data-smartkarma-citation="entities:36053:1" rel="noopener">Nifty Next 50 Index</a>, <a href="https://www.smartkarma.com/entities/nse-nifty-bank-index" target="_blank" data-smartkarma-citation="entities:26811:1" rel="noopener">Nifty Bank Index</a> and <a href="https://www.smartkarma.com/entities/s-p-bse-sensex-index" target="_blank" data-smartkarma-citation="entities:31494:1" rel="noopener">SENSEX Index</a> as a result of the <a href="https://www.smartkarma.com/entities/housing-development-finance" target="_blank" data-smartkarma-citation="entities:252:1" rel="noopener">HDFC Limited</a>/ <a href="https://www.smartkarma.com/entities/hdfc-bank-ltd-4b6b7a92-9087-468d-9dbe-ab169e77f014" target="_blank" data-smartkarma-citation="entities:558:1" rel="noopener">HDFC Bank</a> merger.</li>
<li>There were inflows to <a href="https://www.smartkarma.com/entities/tracker-fund-of-hong-kong-ltd" target="_blank" data-smartkarma-citation="entities:29257:1" rel="noopener">Tracker Fund of Hong Kong Ltd (2800 HK)</a> and outflows from <a href="https://www.smartkarma.com/entities/hang-seng-china-enterprises-index-etf" target="_blank" data-smartkarma-citation="entities:25:1" rel="noopener">Hang Seng H Share Index ETF (2828 HK)</a> during the week.</li>
</ul>


Hang Seng has announced the conclusions of the market consultation. Primary-listed foreign stocks will be eligible for inclusion in the HSI INDEX and HSTECH INDEX from the December rebalance.
The coming week has the rebalances for the NIFTY Index, Nifty Next 50 Index, Nifty Bank Index and SENSEX Index as a result of the HDFC Limited/ HDFC Bank merger.
There were inflows to Tracker Fund of Hong Kong Ltd (2800 HK) and outflows from Hang Seng H Share Index ETF (2828 HK) during the week.


Index Rebalance & ETF Flow Recap: HSCI, HSCEI, HSI, CSI300, CSI500, SSE50, HDFC Bank, Sensex

Foxconn Industrial Internet / Event-Driven

<ul>
<li>Two thirds of the way through the review period, we see 10 potential adds/8 potential deletes in December. However, there can be a maximum of 5 changes at a review.</li>
<li>We estimate a one-way turnover of 5.8% at the December rebalance leading to a one-way trade of CNY 4.67bn. Index arb balances could increase the impact on the stocks.</li>
<li>The potential adds have outperformed the potential deletes over the last six months and there has been renewed outperformance over the last month.</li>
</ul>


Two thirds of the way through the review period, we see 10 potential adds/8 potential deletes in December. However, there can be a maximum of 5 changes at a review.
We estimate a one-way turnover of 5.8% at the December rebalance leading to a one-way trade of CNY 4.67bn. Index arb balances could increase the impact on the stocks.
The potential adds have outperformed the potential deletes over the last six months and there has been renewed outperformance over the last month.


SSE50 Index Rebalance Preview: Potential Adds Powering Higher

Articles from Caixin Global, Caixin Global

Caixin Global

Articles from Caixin Global

Caixin is a media group dedicated to providing financial and business news through periodicals, online content, mobile apps, conferences, books and TV/video programs. Caixin aims to blaze a trail that helps traditional media prosper in the new media age through integrated multimedia platforms.

News from Caixin

Cross Asset Strategy

<ul><li>Robots /In Depth: The march of Chinese robots into domestic factories</li><li>Dam /: China expresses ‘grave concerns’ over Ukraine dam collapse</li><li>Compensation /: Wrongfully convicted man seeks $2.9 million in state compensation</li></ul>

Robots /In Depth: The march of Chinese robots into domestic factoriesDam /: China expresses ‘grave concerns’ over Ukraine dam collapseCompensation /: Wrongfully convicted man seeks $2.9 million in state compensation

CX Daily: The March of Chinese Robots Into Domestic Factories

Thematic (Sector/Industry)

<ul>
<li>It is the time to reassess the commercialization performance and the outlook of China biotech companies, including BeiGene, Innovent, Henlus, Zai Lab, Hutchmed, Junshi, RemeGen, Innocare, Akeso. </li>
<li>We summarized the data of these biotech companies’ product revenue and profit performance to judge whether their commercialization capability is sufficient to afford production, sales teams and long-term R&amp;D activities. </li>
<li>Most China Biotech cannot be said to achieve "commercialization success", but they have showed some difference.We hope investors could have a better understanding about China biotech and make better decisions. </li>
</ul>


It is the time to reassess the commercialization performance and the outlook of China biotech companies, including BeiGene, Innovent, Henlus, Zai Lab, Hutchmed, Junshi, RemeGen, Innocare, Akeso. 
We summarized the data of these biotech companies’ product revenue and profit performance to judge whether their commercialization capability is sufficient to afford production, sales teams and long-term R&amp;D activities. 
Most China Biotech cannot be said to achieve "commercialization success", but they have showed some difference.We hope investors could have a better understanding about China biotech and make better decisions. 


China Biotech – The Commercialization Performance and The Outlook

China

Guangzhou Baiyunshan Pharmaceutical Holdings Co., Ltd. manufactures and sells Chinese patent medicine. The Company also wholesales, retails, imports, and exports Western and Chinese pharmaceutical products and various medical apparatus.

Guangzhou Baiyunshan Pharmaceutical Holdings (874 HK)

Guangzhou Baiyunshan Pharmaceutical Holdings

Changchun High & New Technology Industry (Group) Inc. is an investment holding company.  Through its subsidiaries, the Company manufactures biopharmaceuticals and Chinese traditional medicines, constructs infrastructure facilities, manufactures electrolytic condensers, and develops and manages real estate.

Xizang Haisco Pharmaceutical Group Company Limited develops, manufactures and sells drug formulations and active pharmaceutical ingredients. The Company's main products include hepatobiliary disease medication, anti-infective drugs, parenteral nutrition drugs, invert sugar for injection, and other related products.

Xizang Haisco Pharmaceutical Group Co (002653 CH)

Shenzhen Salubris Pharmaceuticals Co., Ltd. develops, manufactures, and distributes pharmaceutical and healthcare products such as tablets, capsules, injection formulations and active pharmaceutical ingredients.

Shenzhen Salubris Pharmaceuticals A (002294 CH)

Dong-E-E-Jiao Co., Ltd. primarily manufactures and sells traditional Chinese medicine, health care products, health foods, and bio-medicine. The company also engages in gelatin products manufacturing.

Kangmei Pharmaceutical Co., Ltd. develops, produces, and sells medicines that are used for the treatment of high blood pressure and cold.  The Company also pr oduces antibiotic drugs and health care products. Kangmei also sells other manufacturers' medical products through its wholesale and retail chain.

Kangmei Pharmaceutical Co Ltd (600518 CH)

Humanwell Healthcare (Group) Co., Ltd specializes in the R&D and sales of pharmaceuticals, biotechnology, and chemical products, in addition to the import and export of goods and technology. The company, through its subsidiaries, also operate in real estate development and sales, industrial investment and management, and education projects.

Tianjin Zhongxin Pharmaceutical Group Corporation Limited produces and sells traditional Chinese medicine, western medicine, health products, and healthcare instruments.  The Group also manufactures gene-related biopharmaceutical products.  Tianjin Zhongxin markets its products under the Great Wall, Cypress, and Health brand names.

Tianjin Zhongxin Phrmctl Gp Cp (600329 CH)

Shijiangzhuang Yiling Pharmaceutical Co Ltd develops, produces and sells Chinese patent medicine. The Company's major products include Tongxinluo capsules, Shensongyangxin capsules, Lotus Qingwen capsules, Qili Qiangxin capsules and Bazi Bushen capsules.

Shijiazhuang Yiling Pharmaceutical (002603 CH)

Zhejiang Huahai Pharmaceutical Co., Ltd. manufactures and retails pharmaceutical products and medical raw materials. The Company exports its products to many parts of the world.

Zhejiang Huahai Pharmaceutical Co, Ltd. (600521 CH)

Perrigo Company PLC is a global healthcare supplier that develops, manufactures, and distributes OTC and generic prescription pharmaceuticals, infant formulas, nutritional products, active pharmaceutical ingredients and pharmaceutical and medical diagnostic products. The Company's primary markets and locations of manufacturing and logistics operations are the US, UK, Mexico, and Australia.

ROHTO PHARMACEUTICAL CO., LTD. manufactures and markets pharmaceuticals and cosmetics products.  The Company's products include eyewash, bath soaps, gastrointestinal medicine, and hand cream.  Rohto Pharmaceutical also has a license agreement with its subsidiary, Mentholatum (US) to sell their brand products.  The Company also manufactures contact lenses and health foods.

PT Kalbe Farma Tbk produces and develops pharmaceutical products for human and animal healthcare.  Through its subsidiaries, the Company also operates in the pharmaceutical, health food, and packaging industries.

Corcept Therapeutics Inc. is a pharmaceutical company that discovers and develops drugs for the treatment of severe metabolic and psychiatric disorders. The Company's lead product modulates the effect of cortisol, also known as the "stress hormone", by selectively blocking the binding of cortisol to one of its two known receptors, the GR-II receptor.

SANTEN PHARMACEUTICAL CO., LTD. produces and sells ophthalmic medicine.  The Company manufactures a variety of products including eye drops and ointments. Santen Pharmaceutical also imports lenses and tools and equipment used by optometrists and produces anti-rheumatic drugs.

Glaxosmithkline Pharmaceuticals Ltd. manufactures and distributes a wide variety of pharmaceutical drugs, veterinary products and laboratory chemicals. The Company's products include "Phexin" capsules, "Betnesol" tablets and injections, "Becoride" asthma treatment, "Betnovate" ointment, "Cetzine" antihistamine, "Zucox" and "Rizap" anti-tuberculosis products.

Glaxosmithkline Pharmaceuticals (GLXO IN)

Ajanta Pharma Limited is a pharmaceutical company involved in the areas of product research, manufacturing, and marketing. The Company's manufacturing capabilities include segments such as antiretrovirals, antimalarials, cardiovascular, dermatology, and ophthalmology. The Company also markets over the counter products that include some nature-based remedies.

Glenmark Pharmaceuticals Ltd., is a pharmaceutical company. The Company develops generic drugs for inflammation, metabolic disorders, and pain.

Yuhan Corporation manufactures and markets various pharmaceutical products on its own and through joint ventures with other global pharmaceutical companies. The Company also produces personal care products, dietary supplements, and veterinary medicines.

Prestige Brands Holdings, Inc. distributes over-the-counter healthcare and household cleaning products to retail stores in the United States, Canada and other international markets.  The Company distributes oral, eye and skin care; cough, cold, allergy and sinus; and household cleansers, sponges, scrubbers and cleaning pads.

Shanghai Fosun Pharmaceutical (Group) Co., Ltd. is a pharmaceutical company. Through its subsidiaries, the Company manufactures genetic medicines, Chinese traditional medicines, diagnostic products, and medical instruments, provides technology, marketing, and advertising services, as well as invests in import and export trading.

Shanghai Fosun Pharmaceutical (Group) (2196 HK)

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Shanghai Fosun Pharmaceutical (Group) (2196 HK)

Pre-IPO Edding Group - CSO Model Is Hard to Sustain, but Business Transformation Faces Challenges

As once a leading CSO company in China, Edding’s core advantage still lies in sales capabilities. But changes in domestic policy/business...

Xinyao (Criss) Wang

Index Rebalance & ETF Flow Recap: HSCI, HSCEI, HSI, CSI300, CSI500, SSE50, HDFC Bank, Sensex

This recap highlights Insights covering Asian index rebalances (announcements/ forecasts/ IPO Fast Entry/ M&A driven changes). We also highlight...

Brian Freitas

SSE50 Index Rebalance Preview: Potential Adds Powering Higher

Two thirds of the way through the review period, we see 10 potential adds/8 potential deletes in December. Turnover is over 5% and the potential...

Brian Freitas

CX Daily: The March of Chinese Robots Into Domestic Factories

Robots /In Depth: The march of Chinese robots into domestic factories Dam /: China expresses ‘grave concerns’ over Ukraine dam...

Caixin Global

China Biotech – The Commercialization Performance and The Outlook

In the context of the fading dividend of medical system reform and the lack of next big variety, the previous wave of innovative drug boom is hard...

Xinyao (Criss) Wang

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52-week Range

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