Several pharmaceutical stocks opened higher, with Antengene Corporation Limited (HKEX: 06996) up 5.26% at HK$3.5, CanSino Biologics Inc. (HKEX: 06185) up 3.58% at HK$35.88, Joinn Laboratories (China) Co., Ltd. (HKEX: 06127) up 3.22% at HK$31.4, and Genscript Biotech Corporation (HKEX: 01548) up 2.93% at HK$45.

On the news front, on October 2, Abogen announced it would grant worldwide rights to its mRNA-encoded CD19×CD3 dual-target TCE drug ABO2203 to Novartis AG (NYSE: NVS), while also granting Novartis an exclusive option to license "several" next-generation therapeutic assets developed on its RNA platform. The potential total of upfront and milestone payments is up to approximately $7.775 billion, setting a new record for outbound licensing deal value in China's mRNA field.

Earlier in August, Moderna and Merck's personalized mRNA cancer vaccine achieved positive Phase III clinical results, demonstrating the feasibility of mRNA in cancer treatment and prompting global capital markets to reassess the value of the sector.

Notably, the pharmaceutical industry has recently seen a steady stream of positive developments. On the policy front, the U.S. Treasury Department's new rules on investments in China are expected to preserve the ability of U.S. pharmaceutical companies to enter into licensing agreements with Chinese drugmakers. Meanwhile, China's pharmaceutical industry "15th Five-Year Plan" was released, further reinforcing the positioning of biopharmaceuticals as an emerging pillar industry. In addition, recent major business development deals and strategic collaborations have landed intensively, covering frontier areas such as oral weight loss, RAS, and bispecific antibodies, with each single deal exceeding $2 billion.

Kaiyuan Securities believes that domestic innovative drugs are continuing to advance their overseas R&D, and investors should watch for opportunities to realize the value of outbound BD licensing.