Weekly Report on Pharmaceuticals & Biotech (Week 1 of September): Small Nucleic Acid Drug BD Accelerates

Industry Perspective:

Weekly Review. Last week (September 1 - September 5), the pharmaceuticals and biotechnology sector rose by 1.4%, outperforming Wind All A (-1.37%) and CSI 300 (-0.81%). In terms of sub-sectors, other biologics (4.86%), chemical products (4.52%), and medical R&D outsourcing (3.78%) were among the top gainers, while hospitals (-2.31%), vaccines (-2.08%), and medical devices (-1.97%) were among the top losers. Regarding individual stocks, Hainan Hai Chen Pharmaceutical (28.7%), Changchun High-Tech (24.2%), and Baihua Medicine (21.3%) were the top gainers, whereas Staidson (-24%), Guangsheng Tang (-15.8%), and Sailing Medical (-15.6%) were the top losers.

BD in Small Nucleic Acid Drugs Accelerates. On September 2, Arrowhead Pharmaceuticals announced a deal with Novartis for the preclinical stage Parkinson's siRNA therapy ARO-SNCA, with an upfront payment of $200 million, a total package worth up to $2 billion, and double-digit royalties. On September 3, Novartis struck a deal with Argo Biopharma for multiple cardiovascular small nucleic acid drugs, including a $160 million upfront payment, a total package worth up to $5.2 billion, and sales royalties. Within a week, Novartis completed two BD deals in the small nucleic acid space, both at relatively early stages, focusing on chronic diseases such as the nervous system and cardiovascular areas. MNCs continue to invest heavily in the development of small nucleic acid drugs. China’s small nucleic acid drug sector is expected to see accelerated growth. We are optimistic about domestic biotech companies with differentiated liver-targeted delivery technologies and the commercial application of small nucleic acid drugs in managing chronic cardiovascular diseases. We recommend paying attention to innovative drug companies in China that are developing small nucleic acid therapies.

Follow the Progress of the WCLC Conference. From September 6th to 9th, the 2025 World Conference on Lung Cancer (WCLC), hosted by the International Association for the Study of Lung Cancer, is being held in Barcelona, Spain. Several significant advancements in lung cancer research are being announced, and key data from various prominent products in China are being released. It is recommended to pay attention to the innovative pharmaceutical companies participating this year.

Risk Warning: Risks of escalating geopolitical conflicts; business landing below expectations; risks of intensified industry competition; uncertainties in mergers and acquisitions; uncertainties in drug research and development.