China Biopharmaceuticals 1H26 preview: Domestic policy headwinds with global business momentum

Research evidence excerpt

China Biopharmaceuticals 1H26 preview: Domestic policy headwinds with global business momentum

10 July 2026

Equity Research Report

China Biopharmaceuticals EquitiesHealth Care

1H26 preview: Domestic policy headwinds with global

business momentum China

◆ China biopharmaceuticals are a hybrid of China pharma and Linda Shu*, PhD (Reg. No. S1700522120001)

global biotech, with bumpy valuations Head of China Healthcare Research HSBC Qianhai Securities Limited

linda.y.l.shu@hsbcqh.com.cn

◆ We discuss the global business contribution and valuation +86 755 88983246

breakdown Cindy Chai* (Reg. No. S1700523040001)

Analyst, China Healthcare Research

HSBC Qianhai Securities Limited

◆ Top picks – Buy: BeOne, Innovent, CSPC; Buy: Hansoh, cindy.x.r.chai@hsbcqh.com.cn

Hengrui A, SBP; Hold: Livzon A/H, Fosun A/H; initiate Buy: +86 21 5066 2005

Andre Sun* (Reg. No. S1700526040001)

Hengrui H Analyst, China Healthcare

andre.h.j.sun@hsbcqh.com.cn

China pharmaceuticals underperformed the healthcare sector amid the BD +86 21 50662034

trend. The market is debating the valuation. Pharmaceuticals’ valuations show a

dynamic pattern, and investors are observing a structural shift in the overall industry. * Employed by a non-US affiliate of HSBC Securities (USA) Inc, and is

not registered/ qualified pursuant to FINRA regulations

Domestically, the VBP impact is vanishing, and the pharmaceuticals industry is

growing on account of innovative drugs included in the National Reimbursement Drug

List (NDRL). On a global level, we expect China pharma to become an innovation

engine, with mega deals with MNCs and licensing out of early-stage pipelines in new

modalities, such as GLP1, ADC and TCEs – this is reflected in China-orientated