Chinese Innovative Drug BD Deals Surpass $60 Billion in Q1 2026, Driving HK Innovative Pharma ETF (513120) to Surge Over 7% Amid AACR, Policy Tailwinds, and Strong Earnings

In the trading session on April 1, 2026, the innovative drug concept remained highly active.OncoCareStraight to the daily limit up,Rundu Co., Ltd.Previously sealed,Innoforce Bio、Junshi Biosciences、Warner Pharma、Baili TianhengWait for the rise.

National Healthcare Security Administration News: On March 20 and March 23, relevant officials from the National Healthcare Security Administration met with executives from several multinational pharmaceutical companies and industry associations in Beijing, including Eli Lilly, Organon, Medtronic, Pfizer, AstraZeneca, U.S.-based Cohen Group, and the US-China Business Council. The participants engaged in in-depth discussions on improving the multi-level medical security system during the "15th Five-Year Plan" period, establishing a real-world research system, and optimizing the value assessment of innovative drugs.

Overseas, biopharmaceutical company Infinimmune announced an agreement with Merck to develop multiple antibodies targeting various disease targets. The total value of this deal is expected to reach approximately $838 million. Infinimmune stated that it will utilize its proprietary platform to screen human immune cells and identify naturally occurring antibodies, followed by further development of these antibodies using artificial intelligence tools.

The fundamentals of the innovative drug industry continue to improve. In the first three months of 2026, the total value of China's outbound licensing (BD) deals for innovative drugs has exceeded $60 billion, approaching half of the total for the entire year of 2025. This demonstrates the increasing global recognition and participation of China's innovative drugs. Meanwhile, as of March 27, 2026, China has approved 10 innovative drugs this year, eight of which are domestically produced. Additionally, recent policy developments have sent positive signals in the biotechnology sector. The National Medical Products Administration has launched the three-year "Spring Rain Initiative" to support the clinical innovation and transformation of medical devices, providing strong backing for the overall development of the biotechnology industry. At the same time, several pharmaceutical companies have recently released impressive annual reports, boosting market confidence.

In terms of company developments, Sino Biopharm's innovative product revenue reached 15.22 billion yuan in 2025 (a year-on-year increase of 26.2%), accounting for 47.8% of total revenue, with its core pipeline entering a period of rapid growth; the company is simultaneously accelerating AI-enabled R&D, reducing PCC discovery time by 50% and improving clinical risk identification efficiency by 85%.

Hansoh Pharma's innovative drug revenue reached 12.354 billion yuan (+30.4% yoy) in 2025, accounting for 82.2%. Among them, HS-20094 (GLP-1/GIP dual-target weight loss drug) achieved positive results in Phase III clinical trials in March 2026 and submitted for marketing approval.

Innovent Bio Achieves Full Profitability by 2025, with IFRS Net Profit Attributable to Shareholders at RMB 8.14 Billion, Commercial Product Revenue Reaches RMB 11.9 Billion (+45% YoY); Core Product PD-1/IL-2α Bispecific Antibody IBI363 Initiates Global MRCT Phase III Clinical Trial for IO-Resistant Squamous NSCLC and Will Release Phase II Data for Melanoma, First-Line NSCLC, and Colorectal Cancer PoC in 2026; CLDN18.2 ADC IBI343 Receives Two BTDs from NMPA and FTD from FDA, Multicenter Phase III Clinical Trials in China and Japan Ongoing; The Company Confirms at Least Five Products Will Reach Global MRCT Phase III and Obtain Approval in Key International Markets Before 2030.

Recently, the Hong Kong stock market's innovative drug sector has continued to show strong growth momentum.Guohai SecuritiesIt was pointed out that the logic behind innovative drugs and devices has not changed, and the innovation capabilities of domestic companies are gradually strengthening. Great Wall Guorui Securities believes that with the upcoming 2026 AACR Annual Meeting, the participation of China's innovative drug companies is further increasing, with ADCs, small molecules, bispecific antibodies, and CAR-T remaining key areas of focus. As an important global platform for releasing data on innovative cancer drugs, AACR is expected to become a significant catalyst for the next phase of the innovative drug sector, reinforcing market recognition of China's global competitiveness in innovative drugs. Meanwhile, NMPA has launched the three-year "Spring Rain Initiative" aimed at accelerating clinical innovation and transforming medical device achievements, with continued positive signals being released from the policy side.

Guolian MinshengSecurities stressed that the innovative drug sector may have bottomed out, with potential for continued recovery and replenishment. The sector is optimistic in the medium to long term. Progress at the industry level so far this year has far exceeded expectations, with major BD deals from Shiyao and Innovent Bio successfully concluded.Frontier BiotechThe frequent emergence of small nucleic acid BD, Connexions New Co's second BD, etc., coupled with the clear support for innovative technologies in the government work report and the "15th Five-Year Plan," as well as the confirmation of a turning point in profitability brought by the outstanding annual reports of biotech/biopharma companies, continues to validate the logic of innovative drugs' "self-innovation + global realization."

In the intraday trading of ETFs on April 1, 2026, the Hong Kong Stock Connect Innovative Drug ETF (GF) (513120) surged over 7% during the session, aiming for a 4-day consecutive rise. Component stocks include Le Pu Bio-B,Rongchang BioUp more than 14%, Junshi Biosciences up over 12%, Boan Biotech, CloudTop New Glory and other stocks followed the rise. The top ten weighted stocks combined account for 70.73%, among which the weighted stock 3SBio is up over 10%.BeiGene, Innovent Bio, etc. followed the rise.

In terms of scale, as of March 31, 2026, the latest size of the GF HK Innovative Drug ETF reached 24.847 billion yuan. In terms of capital inflow, over a longer period, within the recent 22 trading days, the GF HK Innovative Drug ETF has attracted a total of 390 million yuan.

HSBC Biotech ETF GF (159169) Surges Over 6% Intraday, Component Stock Ascentage Pharma-B Rises Over 11%,InnoCare PharmaUp more than 10%, Everest Medicines up more than 7%. The top ten weighted stocks account for 69.66% in total, among which the weighted stock 3SBio is up over 10%, BeiGene is up over 7%, and Innovent Bio, Wuxi Biologics, etc., followed the upward trend.

Innovative Drug ETF GF (515120) Rises Nearly 5%, with Component Stock Infinimmune Soaring Over 16%,AsymchemLimit-up, Junshi Biosciences rose over 9%. The top ten weighted stocks combined account for 46.28%, among which the weighted stock BeiGene rose over 7%.Pharmaron、TigermedWait for the rise.

In terms of scale, as of March 31, 2026, the Guangfa Innovative Drug ETF has seen a significant growth of 3.55 billion yuan in the past week. In terms of shares, the Guangfa Innovative Drug ETF has increased by 111 million shares in the past month. Regarding capital inflow, over a longer period, the Guangfa Innovative Drug ETF has experienced net inflows on 12 out of the last 22 trading days, attracting a total of 67.8199 million yuan.

Relevant ETFs:

1. Hong Kong Stock Innovative Drug ETF (Guangfa) (513120), (Linked A: 019670, Linked C: 019671): Closely tracks the CSI Hong Kong Innovative Drug Index, investing in Hong Kong's innovative drug industry. Notably, the Hong Kong Stock Innovative Drug ETF (513120) supports T+0 trading, allowing investors to buy and sell multiple times within a trading day, significantly enhancing capital efficiency and liquidity.

2. The Hengsheng Biotech ETF (159169) closely tracks the Hengsheng Biotech Index. The Hengsheng Biotech Index ("HSBIO") aims to reflect the overall performance of the largest 30 biotech companies listed in Hong Kong that also qualify for Stock Connect. According to Wind data, based on the Shenwan secondary industry classification, the top three weighted industries are Biologics (42.07%), Chemical Pharmaceuticals (38.28%), and Medical Services (11.01%).

3. Innovative Drug ETF GF (515120), (Linked A: 012737, Linked C: 012738): Closely tracks the CSI Innovative Drug Industry Index, investing in China's A-share innovative drug industry. Covers companies involved in the R&D, production, and sales of innovative drugs.