Cinda Securities has issued a research report initiating coverage on CMS with a "Buy" rating. The firm forecasts the company's operating revenue for 2025-2027 to be RMB 8.216 billion, RMB 9.859 billion, and RMB 12.028 billion, representing year-on-year growth rates of 10%, 20%, and 22%, respectively. Net profit attributable to shareholders is projected to be RMB 1.615 billion, RMB 1.850 billion, and RMB 2.238 billion for the same period, with growth rates of 0%, 15%, and 21%. The brokerage expresses optimism regarding the company's medium to long-term growth prospects.
The key viewpoints from the report are as follows:
As a leading specialized commercialization enterprise in China, CMS is embarking on a new growth cycle driven by its innovation-focused transformation. Founded in 1992, CMS began as a pharmaceutical agency and has evolved over three decades into an innovative, comprehensive pharmaceutical company. Following the implementation of national volume-based procurement policies, the company's mature products, such as Deanxit, Plendil, and Urso, faced pressure, leading to revenue declines in 2023-2024. However, the negative impact of procurement policies is expected to be largely absorbed by the first half of 2025, with both revenue and net profit growth turning positive. Core businesses like cardiovascular and digestive drugs have stabilized, while emerging segments such as dermatology and ophthalmology are experiencing rapid growth.
The company possesses exceptional, full-chain commercialization capabilities, supported by a professional academic promotion team of approximately 4,700 members. Its network extensively covers over 50,000 Chinese hospitals and medical institutions, around 300,000 retail pharmacies, and major e-commerce platforms, enabling efficient product volume expansion. On the international front, CMS has strategically established an integrated layout in Southeast Asia encompassing R&D, registration, commercialization, and production, creating a sustainable long-term secondary growth curve.
CMS's four major business segments are advancing synergistically. The cardiovascular disease portfolio, accounting for approximately 48% of revenue, serves as the pillar business. The impact of volume-based procurement has largely been mitigated, and innovative products like Viferi are scaling up rapidly. The digestive and autoimmune segment contributes about 30% of revenue, anchored by exclusive products such as Bioflor and Combizym, with new innovative products like Metetoin providing additional growth. The dermatology health business, representing around 11% of revenue and operated independently by subsidiary Demai Pharmaceutical, holds significant potential with its launched biologic product Ilumetri and the recently approved key product Ruxolitinib Phosphate Cream for vitiligo. A potential spin-off listing could further enhance its valuation. The ophthalmology segment, comprising about 8% of revenue, is centered on the exclusive product Shitulun Eye Drops. The recent introduction of Novartis's Lucentis and Beovu anti-VEGF drugs has created a competitive portfolio of pharmaceutical and device products, signaling strong growth momentum.
The company's innovation pipeline is entering a harvest period, with multiple achievements materializing. Through collaborative development and in-house R&D, CMS has efficiently built a pipeline of nearly 40 innovative assets. Six innovative drugs have already been successfully launched and commercialized. Key innovative products currently under New Drug Application review include: 1) Y-3 Injection for acute ischemic stroke, also offering post-stroke depression and anxiety prevention, with its NDA accepted in December 2025; 2) Desidustat Tablets for anemia in non-dialysis adult chronic kidney disease patients, NDA accepted in April 2024; 3) Sileverimab Injection for passive immunization in adults with suspected rabies virus exposure, NDA accepted in January 2025; 4) Vicandutumab Injection for passive immunization against tetanus, NDA accepted in May 2025; 5) ZUNVEYL for Alzheimer's disease treatment, NDA accepted in July 2025; and 6) MG-K10, an IL-4Rα monoclonal antibody for atopic dermatitis, with its marketing application accepted in October 2025. Estimates suggest the combined peak sales potential for these core innovative products exceeds tens of billions of RMB. Furthermore, several self-developed innovative drugs are progressively entering clinical stages, indicating a dense pipeline of diverse innovations.
Risk factors include potential changes in national volume-based drug procurement policies, delays in the R&D or approval of innovative products, challenges in commercializing new drugs, and risks associated with international operations.