JOINN (06127) rose more than 5%, reaching HK$22.38 by the time of writing, with a trading volume of HK$116 million.

According to a research report released on December 22, preclinical CRO client demand is recovering, while the supply of lab monkeys remains tight. In safety evaluation stages, new technology platforms such as large molecules (multi-antibodies, ADCs), small nucleic acids, peptides, and cell/gene therapies require crab-eating macaques to simulate human drug safety testing. Currently, the price for 3-5-year-old crab-eating macaques has surged to RMB 140,000 per monkey, with demand outstripping supply this year. This further confirms the recovery in China's innovative drug R&D sector. Additionally, rising monkey prices are expected to directly contribute to profits through fair value adjustments.

Ping An Securities estimates that, using JOINN as an example, if the average price of lab monkeys in 2024 is recorded at RMB 84,900 per monkey and rises to RMB 140,000 by Q4 2025, with an assumed farm output rate of 17%, the fair value adjustment could generate approximately RMB 220 million in additional profit in 2025 (based on 23,200 monkeys, excluding newly added or immature/aged monkeys).