Financial Services Association, April 8 (Editor: Feng Yi) Recently, support policies for the innovative pharmaceutical industry have been issued in many places, bringing a new market catalyst to the current relatively quiet pharmaceutical stocks. The Hong Kong stock pharmaceutical sector is also active today.

According to the news, on April 7, Beijing, Guangzhou, Zhuhai and other places successively issued policy documents for the high-quality development of the innovative drugs/biomedical industry. Policy trends continued to be loosened, and there was also heavy financial support from the financial side, which attracted market attention.

Among them, according to the “Certain Policies and Measures to Promote the High-Quality Development of the Biomedical Industry in Guangzhou” issued by the General Office of the Guangzhou Municipal People's Government recently, the new drug projects that have started phase I, II, and III clinical research will be given financial support of up to 3 million yuan, 5 million yuan, and 10 million yuan respectively after review. Each year, a single enterprise receives up to 100 million yuan in clinical trial funding.

In addition, the “Guangzhou Development Zone (Huangpu District) Measures to Promote the High-Quality Development of the Biomedical Industry” mentions that for a number of top biomedical projects with disruptive technological innovation breakthroughs and clear and broad application prospects, led by masters and strategic scientists with global influence, the maximum support amount is 5 billion yuan, and the support period is up to 5 years.

Zheng Wei, an analyst at Guolian Securities, also said in the April 8 report that it is expected that in the future, more regions will continue to follow up on the full chain policy of innovative drugs and promote implementation.

What is more noteworthy is that at the beginning of April, a multinational acquisition worth over 10 billion dollars also brought a positive signal to the current domestic innovative drug industry.

On April 2, Danish biotech company Genmab announced the acquisition of domestic antibody-conjugated drug company Pufang Biotech for 1.8 billion US dollars (approximately RMB 13.021 billion).

On the one hand, this acquisition of over 10 billion yuan has greatly boosted the confidence and expectations of domestic innovative drug investment. Some industry insiders say that the benefits of the deal are not even lower than the IPO.

At the same time, this means that the competitiveness and potential value of Chinese biopharmaceutical companies are being exploited in the global market, and it has also brought a demonstration effect to other domestic companies focusing on innovative drug research and development.

Furthermore, the fundamentals of the domestic pharmaceutical industry are currently showing signs of warming up. According to the data, as of April 8, 230 A-share pharmaceutical companies disclosed their 2023 annual reports. Among them, 118 companies' net profit to mother increased year-on-year, accounting for more than 50%. Companies in the three segments of medical devices, chemical pharmaceuticals, and traditional Chinese medicine performed outstanding.

The Pacific Securities Biomedical Team pointed out in an April 7 report that in conjunction with the “Notice on Establishing a Initial Price Formation Mechanism for Newly Launched Chemicals to Encourage High-Quality Innovation (Draft for Comments)” drafted by the National Health Insurance Administration on February 5, it is expected to open the door for independent pricing of innovative drugs. Innovation support policies have blossomed in many places, benefiting the long-term performance of innovative pharmaceutical companies.