Innovative drug companies have welcomed another major catalyst. Recently, the 2025 World Conference on Lung Cancer (WCLC) was held in Barcelona, Spain. Notable innovative drug companies including BeiGene-U, Belite Bio, and InnoCare-U all had important research selected for oral presentations at this annual conference.

Additionally, based on recently disclosed half-year financial results, domestic innovative drug R&D has generally entered a harvest period as new drug product commercialization accelerates.

At the 2025 World Conference on Lung Cancer (WCLC), Belite Bio's independently developed iza-bren (EGFR×HER3 dual antibody ADC) for treating EGFR-mutated lung cancer had two research results selected for the WCLC official Press Program with oral presentations. Particularly noteworthy, clinical data from one study showed that this treatment regimen achieved an objective response rate (ORR, the proportion of patients whose tumor volume shrinks to a certain extent and maintains for a certain period) of 100%, drawing significant industry attention.

On the policy front, the National Healthcare Security Administration recently announced the preliminary review list for the 2025 commercial insurance innovative drug directory, with over 100 innovative drugs making the list, covering areas including oncology (such as CAR-T therapy, sacituzumab govitecan), rare diseases, and chronic diseases (such as Alzheimer's disease drugs, oral semaglutide). Analysts believe this move signals "commercial insurance undertaking high-value innovative drugs" and could become the "second growth curve" for innovative drugs.

Since 2025, innovative drug companies' R&D achievements have accelerated their transformation and implementation. According to CMB International statistics, among 393 pharmaceutical companies listed on A-shares and Hong Kong stocks in the first half of 2025, the innovative drug sector performed best with average revenue growth of 35%, maintaining strong momentum. This is mainly due to innovative drugs enjoying a relatively positive healthcare insurance payment environment and multiple innovative drug companies achieving overseas licensing deals.

Multiple innovative drug companies have significantly reduced losses or even achieved positive operating profits. For example, BeiGene achieved net profit attributable to shareholders of 450 million yuan in the first half of 2025, turning from loss to profit year-over-year. The company stated in its financial report that this was mainly due to sales growth of its self-developed product zanubrutinib capsules, Amgen-licensed products, and toripalimab injection.

Looking at Hengrui Medicine, the company achieved operating revenue of 15.761 billion yuan in the first half, up 15.88% year-over-year; net profit attributable to shareholders of 4.45 billion yuan, up 29.67% year-over-year; and net operating cash flow of 4.30 billion yuan, up 41.80% year-over-year. Revenue, net profit, and net operating cash flow all reached new highs for the same period in previous years, with performance entering explosive growth.

Allist Pharmaceuticals, focusing on the lung cancer field, also delivered impressive results, achieving over 50% sales revenue growth on a high base. In the first half of this year, the company achieved operating revenue of 2.374 billion yuan, up 50.57% year-over-year, with second-quarter sequential growth of 16.12%; net profit attributable to parent company of 1.051 billion yuan, up 60.22% year-over-year. Among these, the company's core product furmonertinib covers first- and second-line treatment for non-small cell lung cancer and has received authoritative clinical guideline recommendations, with continued strong sales in the first half, achieving total sales revenue of 2.36 billion yuan.

From an investment perspective, CMB International believes that benefiting from positive factors such as innovative drug overseas transactions and optimization of domestic volume-based procurement policies, the pharmaceutical industry is expected to continue rising. In the short term, due to high market expectations for the frequency and scale of overseas transactions, innovative drug valuations continue to climb, requiring a rational view of stock price upside potential.

Founder Securities points out that the strong main theme attributes of innovative drugs remain unchanged, and September may be the starting point of a new wave of innovative drug market activity. Orient Securities believes that the current period may still be an excellent time to allocate innovative drugs.

China AMC Fund emphasizes that innovative drugs remain the strongest main theme and are expected to continue. Starting in September, major conferences in the second half including the World Conference on Lung Cancer, European Society for Medical Oncology Congress, and American Society of Hematology Annual Meeting will all feature key clinical data readouts from Chinese innovative drugs. Combined with the arrival of the peak overseas big pharma MNC licensing season at year-end (with multiple Chinese potential best-in-class candidates already in mid-to-late stage negotiations), innovative drugs are expected to welcome a market feast similar to the "stellar performance of Chinese innovative drug data" at the American Society of Clinical Oncology meeting in May this year over the next quarter.

Related Concept Stocks:

FOSUN PHARMA (02196): International investment bank Morgan Stanley's latest research report indicates that FOSUN PHARMA is showing improving profitability trends, with its innovative drug pipeline value underestimated by the market. Combined with financial optimization from non-core asset divestiture in the first half of 2025, the firm has upgraded both A-share and H-share ratings to "Overweight" and raised the A-share target price to 42 yuan and H-share target price to 33 Hong Kong dollars, representing significant upside potential from current stock prices.

CSPC PHARMA (00460): The company announced that its non-wholly owned subsidiary Huisheng Biopharmaceutical's independently developed glucagon-like peptide-1 receptor (GLP-1R)/glucagon receptor (GCGR) dual-target agonist innovative drug P052 injection has received tacit approval from the National Medical Products Administration (NMPA) Center for Drug Evaluation (CDE) for its Investigational New Drug (IND) application, for treating type 2 diabetes, overweight, or obesity.

CORNERSTONE THERAPEUTICS-B (02616): From April 25-30, 2025, the American Association for Cancer Research (AACR) annual meeting was held in Chicago, USA. CORNERSTONE THERAPEUTICS showcased five independently developed pipeline 2.0 innovative products at this conference, presenting their latest preclinical research results through poster displays, including tri-specific antibody CS2009 (PD-1/VEGF/CTLA-4 tri-specific antibody), bispecific antibody CS2011 (EGFR/HER3 bispecific antibody), and three innovative ADC molecules from the company's proprietary antibody-drug conjugate (ADC) platform: CS5007 (EGFR/HER3 bispecific ADC), CS5005 (ITGB4 ADC), and CS5006 (SSTR2 ADC).

ABBISKO-B (02256): The company's subsidiary Abbisko Medicine announced that its highly selective small molecule CSF-1R inhibitor pimitespib (ABSK021) has been included in priority review by China's National Medical Products Administration Center for Drug Evaluation (CDE) for treating patients with tenosynovial giant cell tumor (TGCT).

HARBOURBIOMED (02142): HarbourBioMed recently announced interim results with revenue of approximately $101 million, up about 327% year-over-year; profit for the period of $72.999 million, up 5125% year-over-year. Among these, molecular licensing fee income increased from $20.8 million to $93.7 million, mainly due to strategic cooperation with global pharmaceutical companies and newly obtained innovative product out-licensing. Meanwhile, research services and technology licensing fee income grew 164.9% from $2.9 million to $7.6 million. Additionally, the company announced plans to place a total of 45.022 million new shares, representing 5.17% of the enlarged share capital, at a placing price of HK$11.5 per share. The estimated net proceeds of HK$512 million from the placing will be used approximately 50% for developing innovative drug assets R&D, about 40% for advancing clinical trials of existing pipeline drug assets, and about 10% for working capital and other general corporate purposes.

INNOVENT BIO (01801): In early September, Jefferies released a research report stating that INNOVENT BIO is expanding its commercialization capabilities beyond the oncology field, covering diversified channels. Its independently developed PD-1/IL-2α-bias bispecific antibody fusion protein IBI363 will independently initiate a global Phase III clinical trial for squamous non-small cell lung cancer. The firm believes it shows potential in melanoma (mucosal and acral types) at low doses (1mg/kg); maintains "Buy" rating with target price raised to HK$105.