Guojin Securities: Maintain a "Buy" rating for China Biopharmaceuticals; significant results from innovation upgrades

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Guojin Securities released a research report stating that China Bio-Pharmaceuticals (01177) has steady performance growth, with significant results from innovation upgrades. It is expected that the operating income for 26/27 will be 39 billion/43.4 billion yuan (original forecast 37.2/41.7 billion yuan), with an additional forecast of 48.3 billion yuan for 28 years; net profit for 26/27 is expected to be 3.7 billion/4.4 billion yuan (original forecast 4.8/5.3 billion yuan), with an additional forecast of 5.3 billion yuan for 28 years. Maintain a “Buy” rating.

Guojin Securities’s main points are as follows:

Performance Brief

On March 26, 2026, the company released its 2025 performance report. In 2025, the company achieved revenue of 31.83 billion yuan, a year-on-year increase of 10.3% (based on continuing operations); net profit attributable to the parent was 2.34 billion yuan, a year-on-year increase of 22.0%; adjusted Non-HKFRS net profit attributable to the parent was 4.54 billion yuan, a year-on-year increase of 31.4% (excluding fair value changes and one-time impairment adjustments of certain assets and liabilities).

Innovative Products Achieve Rapid Growth

In 2025, the company’s innovative product revenue reached 15.22 billion yuan, a year-on-year increase of 26.2%, accounting for 48% of total revenue (+6 PCTs). This is mainly due to the rapid volume increase of products launched in the past three years, including Class 1 new drugs such as Ibegecitin α, Bemesumab, Goserelin, Anike Tini, and Epfona Ake, as well as multiple biosimilar products. The company expects about 20 innovative products and new indications to be approved and launched between 2026 and 2028, continuously increasing the proportion of innovative product revenue.

International Expansion Continues, License-out Achieves Major Breakthroughs

The company signed an exclusive licensing agreement with Sanofi for JAK/ROCK inhibitor Rovalcitib, with a transaction amount including a $135 million upfront payment, $1.4B in development, regulatory, and sales milestones, and double-digit royalty fees. This is the largest transaction in China’s transplantation field to date and marks an important milestone in the company’s international licensing efforts. More pipeline products going overseas in the future are worth期待。

Focusing on Key Disease Areas, Major Assets Introduce New Developments

Through strategic acquisitions of Lixin and Hegia, the company’s technological platform layout is further improved. In the oncology field, the company is developing next-generation therapies through precise targeting, I/O, and ADC platforms. Lixin focuses on the development of next-generation tumor biopharmaceuticals, including antibodies targeting difficult-to-drug targets, next-generation antibody-drug conjugates, and tumor microenvironment technologies; Hegia’s liver delivery MVIP is the world’s first siRNA platform validated by clinical data, enabling once-a-year injections, further strengthening the metabolism field layout, with additional expansion in cardiovascular and weight-loss areas.

Risk Warnings

Risks of failure in new drug development; risks of slower-than-expected R&D progress; drug price reduction risks.

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Editor: Shi Lijun