HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Over 15 years' experience in both finance and healthcare, covering clinic operations, investment and equity research in both China and overseas.

Jiangsu Hengrui Medicine (600276.CH) 23H1 - Has the Turning Point of Performance Really Arrived?

China Healthcare Weekly (Mar.1) - Prioritize Big Pharma, Real Ownership of Pricing Power, Hengrui

Jiangsu Hengrui Medicine (600276.CH) 2022/23Q1 - The Situation Is Not as Optimistic as Imagined

Sichuan Kelun-Biotech Biopharm (6990.HK) - Once the Products Hit the Market, Good Story May Stop

Escalation of Israel-Hamas War - Here's How Investors Should Position Themselves in Dramatic Changes

Equity Bottom-Up

Jiangsu Hengrui Medicine / Equity Bottom-Up

<ul>
<li>Around RMB5 billion generic drugs would be included in VBP in 2024/2025 (e.g. sevoflurane/Ioversol/butorphanol tartrate). So, the assumption that all the negative effects of VBP have cleared up isn’t correct.</li>
<li>Hengrui’s innovative drugs would lose growth momentum after they reach peak sales. It’s difficult for Hengrui to maintain its scale expansion or achieve the over 20% YoY revenue growth.</li>
<li>Hengrui’s PE would fall below 30 (or even below 20) in the future, which means its valuation would start to enter a downward trend. Current high valuation cannot be justified.</li>
</ul>


Around RMB5 billion generic drugs would be included in VBP in 2024/2025 (e.g. sevoflurane/Ioversol/butorphanol tartrate). So, the assumption that all the negative effects of VBP have cleared up isn’t correct.
Hengrui’s innovative drugs would lose growth momentum after they reach peak sales. It’s difficult for Hengrui to maintain its scale expansion or achieve the over 20% YoY revenue growth.
Hengrui’s PE would fall below 30 (or even below 20) in the future, which means its valuation would start to enter a downward trend. Current high valuation cannot be justified.


Jiangsu Hengrui Medicine (600276.CH) - More Downside Ahead; The Long Logic Doesn't Exist