Pharmaceutical & Biotech Industry Weekly Report (2nd Week of January): Dual Momentum in BD Deals—Global Outbound and Domestic Licensing

Industry Perspective:

Weekly Review. Last week (January 12 - January 16), the pharmaceuticals and biotechnology sector fell by 0.68%, underperforming both the Wind All A Index (0.49%) and the CSI 300 Index (-0.57%). Among the sub-sectors, Pharmaceuticals (7.33%), Medical R&D Outsourcing (4.46%), and Offline Pharmacies (2.48%) were the top gainers, while Chemical Preparations (-1.99%), In Vitro Diagnostics (-0.93%), and Vaccines (-0.56%) were the top losers. Regarding individual stocks, AI + Healthcare applications were a popular theme. Guangdong Biolight Meditech Co., Ltd. (48.8%), Jiangsu Hualan New Pharmaceutical Material Co., Ltd. (32.7%), and Tianzhigang-U (27.7%) were among the top gainers, while Xiangrikui (-37.5%), *ST Changyao (-33.3%), and Lu Yan Pharmaceutical (-26.6%) were among the top losers.

BD Transactions Flourish Both in China and Overseas. On January 12, RemeGen entered into an exclusive global license agreement (excluding Greater China) with AbbVie for the key PD-1/VEGF bispecific antibody RC148, with an upfront payment of $650 million and a total deal worth $5.6 billion. On the same day, Summit Therapeutics announced that it had submitted a Biologics License Application (BLA) to the FDA for Eftilagimod Alpha and reached a clinical collaboration agreement with GSK on B7H3 ADC combination therapy. The strategic significance of cornerstone drugs in second-generation IO therapies has been further strengthened, with high-profile pipelines continuing to advance rapidly after going overseas. On January 16, raynovent licensed its GLP-1/GIP agonist RAY1225 to Qilu Pharmaceutical for the Chinese market, with an upfront payment of 200 million yuan and a total deal worth 1 billion yuan. Second-generation IO and

Multi-target weight loss drugs have been a popular BD (Business Development) focus in recent years. The year kicked off with several major BD deals being finalized, involving both overseas and domestic transactions. Star drug Evecanib is also advancing steadily in foreign markets. We believe that this wave of BD enthusiasm for China-produced innovative drugs is not a fleeting phenomenon; domestic biotech companies have already made significant progress in bispecific antibodies and ADCs (Antibody-Drug Conjugates).

...and other fields have platform-type advantages. The authorized varieties will gradually enter the data-readout phase, and the technically validated platforms are expected to continuously generate iterative pipelines. It is recommended to pay attention to star biotech companies with validated platform effectiveness.

Risk Warning: Risks from escalating geopolitical conflicts; business implementation falling short of expectations;

Risk of intensified industry competition; uncertainty in mergers and acquisitions; risks associated with the uncertainty of drug development.