Periodic/Sector reports
China Healthcare - Bi-Weekly: Strengthening Innovation To Sustain Growth
MARKET WEIGHT (Maintained)
Analyst
Analyst
Highlights
- After gaining 9.3% in August on strong 1H26 results, the HSHCI slipped 2.5% in 1-16 Sep 26 on overall weak market sentiment. Innovent, BeOne, and Hansoh Pharma experienced a pullback in the past two weeks, whereas Insilico, HUTCHMED, Akeso, Edge Medical, and WuXi AppTec strengthened.
- China biopharma innovation continues to advance, with Category 1 drug approvals and out-licensing deal value both at record highs - boding well for sustainable earnings growth.
- Maintain MARKET WEIGHT.
Bi-Weekly Recap
Most healthcare companies under our coverage reported strong 1H26 results. Leading drug innovators: Innovent, BeOne Medicines, and Hansoh Pharma, beat expectations on steady new product launches, rising licensing income, and improving operating efficiency. WuXi AppTec and WuXi Bio saw accelerated earnings growth on strong demand and margin improvement, while accelerated overseas expansion supported the recovery of medical device players. Innovation and globalisation will continue to drive rapid revenue growth for leading drug innovators and medtech companies. Internet healthcare companies expanded steadily amid mixed results, whereas traditional Chinese medicines may face further earnings declines from volume-based procurement (VBP) price pressure.
Major Industry News
2026 NRDL and commercial insurance drug list price talks concluded. China's 2026 National Reimbursement Drug List (NRDL) and Commercial Insurance Innovative Drug List negotiations were held on 5-9 Sep 26 in Beijing. A total of 124 drugs were shortlisted for negotiations, with separate negotiations for 12 commercial insurance innovative drugs. The price talks involved more than 100 domestic and MNC companies. Four new mechanisms (ie pre-negotiation consultation, reference-drug pricing, pre-submission reviews, and dual-catalogue alignment) were rolled out for the first time, front-loading bargaining and boosting efficiency. Both lists are expected in Nov 26, effective 1 Jan 27.
Highlights
- After gaining 9.3% in August on strong 1H26 results, the HSHCI slipped 2.5% in 1-16 Sep 26 on overall weak market sentiment. Innovent, BeOne, and Hansoh Pharma experienced a pullback in the past two weeks, whereas Insilico, HUTCHMED, Akeso, Edge Medical, and WuXi AppTec strengthened.
- China biopharma innovation continues to advance, with Category 1 drug approvals and out-licensing deal value both at record highs - boding well for sustainable earnings growth.
- Maintain MARKET WEIGHT.
Bi-Weekly Recap
Most healthcare companies under our coverage reported strong 1H26 results. Leading drug innovators: Innovent, BeOne Medicines, and Hansoh Pharma, beat expectations on steady new product launches, rising licensing income, and improving operating efficiency. WuXi AppTec and WuXi Bio saw accelerated earnings growth on strong demand and margin improvement, while accelerated overseas expansion supported the recovery of medical device players. Innovation and globalisation will continue to drive rapid revenue growth for leading drug innovators and medtech companies. Internet healthcare companies expanded steadily amid mixed results, whereas traditional Chinese medicines may face further earnings declines from volume-based procurement (VBP) price pressure.
Major Industry News
2026 NRDL and commercial insurance drug list price talks concluded. China's 2026 National Reimbursement Drug List (NRDL) and Commercial Insurance Innovative Drug List negotiations were held on 5-9 Sep 26 in Beijing. A total of 124 drugs were shortlisted for negotiations, with separate negotiations for 12 commercial insurance innovative drugs. The price talks involved more than 100 domestic and MNC companies. Four new mechanisms (ie pre-negotiation consultation, reference-drug pricing, pre-submission reviews, and dual-catalogue alignment) were rolled out for the first time, front-loading bargaining and boosting efficiency. Both lists are expected in Nov 26, effective 1 Jan 27.
MARKET WEIGHT (Maintained)
Analyst
Analyst
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This report is provided subject to, and must be read together with, the full Disclosures / Disclaimers available at this link, which are incorporated by reference into this report. In particular, this report is intended for general circulation and informational purposes only and does not constitute personal investment advice or a recommendation to buy or sell any investment product or security. You should independently evaluate the information and, where necessary, seek advice from a qualified financial adviser regarding the suitability of any investment. Analyst certifications required under applicable regulations, including SEC Regulation AC (where relevant), are included in this report. By accessing, receiving or using this report, you acknowledge that you have read, understood and agreed to be bound by the Disclosures / Disclaimers, as may be amended, supplemented or updated from time to time.
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