GF Securities has released a research report initiating coverage on Sino Biopharm (01177) with a "Buy" rating. The firm forecasts the company's EPS for 2025-27 at 0.23, 0.26, and 0.28 yuan per share respectively, with a fair value of 11.54 HKD per share. The company is regarded as a benchmark for traditional pharmaceutical companies' innovation transformation. Through in-house R&D, mergers and acquisitions, and pipeline introductions, the company has built a robust product portfolio. Currently, the company's product pipeline covers four core therapeutic areas: oncology, liver disease, respiratory system, and surgical/pain management, successfully achieving strategic transformation from a generic drug company to a R&D-driven international pharmaceutical group.

The firm noted that Sino Biopharm has expanded its new drug portfolio through "in-house R&D + business development," with comprehensive development across four major areas. From 2018 to H1 2025, the company's R&D investment has increased year by year, with R&D expense ratio rising from 9.9% to 18.1%. In H1 2025, the company's R&D expenses reached 3.188 billion yuan, with approximately 78% invested in innovative drug development. The company has now established a strong product portfolio concentrated in four major areas:

(1) Oncology: ①"Defu" combination: Anlotinib is one of the flagship varieties in the oncology field. Combining with anti-PD-(L)1 to expand first-line indications is an important strategy. The combination of anlotinib and benmelstobart has been approved for SCLC, endometrial cancer, and renal cell carcinoma, while first-line treatment for squamous NSCLC and hepatocellular carcinoma has also been submitted for marketing approval; ②HER2 dual antibody ADC: TQB2102 leads globally in progress, with Phase III trials underway for treating HER2-low expressing and HER2-positive breast cancer; ③CDK2/4/6 inhibitor: Kumoxili is the world's first-in-class CDK2/4/6 inhibitor, with marketing application submitted for treating HR+/HER2-BC; ④CCR8 monoclonal antibody: LM-108 is globally first-in-class, currently in Phase II both domestically and internationally.

(2) Respiratory: PDE3/4 inhibitor is expected to become a blockbuster COPD drug, with TQC3721 ranking second globally in progress.

(3) Liver disease: Pan-PPAR agonist Lanifibranor may become the first MASH drug in China; FGF21 fusion protein may become the most effective MASH drug.

(4) Surgical and pain management: Four major patch technology platforms have been established, consolidating the leading position in transdermal preparations.