Lead: With the cooling of capital and the fading of bubbles, innovative drugs in China have entered a new stage of rational return and sustainable growth by relying on R&D strength and global BD layout.
In recent months, the innovative medicine sector seems to have quietly entered the adjustment period-this is not only the fluctuation of individual companies' stock prices, but also the overall cooling of industry sentiment.
Judging from the trend of Hong Kong stocks and ETFs, this trend is very obvious. Take Global X China Biotechnology ETF (2820.HK) as an example. As of October 23rd, the price of the ETF was HK$ 73.28, which was about 11.6% lower than the peak of HK$ 82.9 at the beginning of this month.
Focusing on individual stocks, some head innovative drug companies have also undergone significant adjustments. Baekje Shenzhou and Cinda Bio once fell below the annual support, and their share prices were under pressure; Companies such as Beida Pharmaceutical have fallen by more than 6% in the past two months.
The synchronous adjustment of ETF, index and leading stocks, as well as the fall of short-term high-heat market, people can't help thinking: has the innovative drug bubble burst?
01、From fanaticism to calmness
Behind the market correction, there are obvious internal and external pressures.
Turning the time back to a few months ago, the innovative medicine sector has almost become the "darling" of the capital market. At that time, the dazzling wave of BD transactions came one after another, with hundreds of millions or even hundreds of millions of dollars in down payment frequently, and the stock prices of many pharmaceutical companies doubled one after another. There is even a "monster stock" spectacle that has not yet been commercialized but the stock price has soared. At that time, the focus of the market shifted from R&D pipeline and clinical value to "who signed quickly and who paid a large amount".
However, the bubble will not last long after all. When "BD = stock price catalysis" became the market consensus, speculative funds overdrawn in advance. With the increase of transactions, it is more difficult to cash, and investors begin to re-examine the actual value behind the transactions: some enterprise pipelines are still in the early stage, the commercialization cycle is long, and the market capacity has not been verified. The style of funds has also changed from chasing up to defense, and the innovative drug sector with high expectations, high valuation and high volatility has naturally become the first choice for "squeezing bubbles".
At the same time, policy and international environmental risks have intensified fluctuations. The Trump administration intends to amend the Biosecure Act to strengthen the review of drug research and development and authorized transactions from China, and suggests that the National Security Council intervene in the assessment; At the same time, the US FDA plans to implement stricter supervision on clinical trial data in China, including increasing review fees and strengthening data verification. This means that China's innovative drugs will face higher compliance cost and time threshold.
Influenced by the US global pharmaceutical tariff policy, international capital, led by risk aversion, withdrew from high-volatility and high-risk assets and turned to a track with stable cash flow and higher profitability. Tariff policy increases the cost and uncertainty of supply chain of multinational pharmaceutical companies, and further amplifies the fluctuation of high-valued innovative pharmaceutical companies. Under the dual effects of capital flow and policy risk, the pressure of the innovative drug sector is obvious.
The superposition of the two pressures of policy and capital is pushing the innovative medicine sector to return to rationality from the emotional high point.
02、The foam needs squeezing.
Historical experience tells us that when the market is in the most panic, there is often a once-in-a-decade opportunity buried.
The stock price performance in recent months has shown a turning point-although ——BD news is still a hot spot in the sector, the market is no longer blindly sought after, but more rationally digests "expectations".
Specifically, the stimulating effect of some high-potential BD transactions on stock prices is obviously weakened. For example, Wei Lizhibo announced on the evening of October 16th that it had reached an exclusive global cooperation with Dianthus. Although it rose by 5.66% the next day, it finally closed down by 1.89%. After Nuocheng Jianhua issued a large license agreement on October 8, its share price fell by 11.64% and 11.49% for two consecutive days. These cases show that even high-value BD transactions are difficult to continuously push the stock price up as before. This shows that the innovative medicine sector is gradually transitioning from the stage of "rapid rise and emotional drive" to the stage of "rational regression and fundamental test".
In the longer term, this is not a bad thing. The capital market will not let all "expectations" be cashed in at one time, nor will it let all "benefits" be released at one time. Adjustment and self-repair are the processes that mature markets must go through. The current cooling is actually a healthy self-repair: the innovative medicine sector is experiencing the necessary "squeezing bubble", and the capital story is returning to the attention of R&D strength, commercialization ability and global competitiveness.
Prosperity and decline is not a pessimistic conclusion, but an inevitable stage of the spiral rise of the industry, laying a more solid foundation for long-term value growth.
03、A new starting point after adjustment
Then, the question comes: does this mean that innovative drugs go out to sea and the BD model will fail? The answer is obviously no.
In fact, from a longer perspective, the direction of innovative drugs has not wavered, and its underlying logic is still stable: global MNCs are facing a revenue gap brought about by the expiration of patents and are in urgent need of new innovative assets, while China Biotechnology Company has strong research and development capabilities and cost advantages in the fields of cancer, immunity and cardiovascular metabolic diseases, and can provide high-quality drugs; At the same time, compared with traditional M&A, the external authorization model has lower risk, better cost and higher flexibility, which can meet the diversified needs of global pharmaceutical companies. It is even possible to set sail more steadily with this adjustment.
According to Morgan Stanley's forecast, by 2035, MNCs will lose about $115 billion in revenue due to patent expiration, of which there will be a gap of $40 billion before 2030. The core gap is mainly concentrated in the three major areas of cancer, immunity and cardiovascular metabolic diseases, accounting for more than 80%. Although Biotech enterprises can contribute part of the income, the gap is still significant due to the clinical failure rate and regulatory uncertainty. MNCs is expected to invest about 480 billion US dollars in M&A /BD, plus 117 billion US dollars from commercial innovative pharmaceutical companies, and the total purchasing power is close to 600 billion US dollars, which is enough to fill the gap brought by the patent cliff.
This long-term trend has been verified in recent years:
- According to GlobalData, in 2024, the proportion of innovative drugs introduced by large global pharmaceutical companies from China biopharmaceutical companies reached 28%, a record high;
- According to DealForma data, in 2025, China companies have accounted for 42% of authorized transactions of more than $50 million.
- According to the statistics of Medical Rubik's Cube, there were 135 domestic license-out transactions from January 1 to October 17, 2025, with a down payment of about 4.976 billion US dollars and a total amount of about 102.996 billion US dollars.
These figures clearly show that even if the market cools down in the short term, the "chassis" of innovative drugs going out to sea has not collapsed.
Recently, many domestic pharmaceutical companies have heard good news about foreign authorization transactions. Cinda Bio, Hansen Pharmaceutical, Puruijin, Weilizhibo, Osekan, Haihe Pharmaceutical and many other companies have reached BD agreements on the tracks of PD-1/IL-2α antibody, CDH17 ADC, CAR-T, BDCA2/TACI bispecific protein, VEGF/ANG-2 bispecific antibody and PI3Kα inhibitor respectively. Among them, the cooperation between Cinda Bio and Takeda Pharmaceutical totaled US$ 11.4 billion, which set a new record for the authorization of innovative drugs to go to sea in China. This trading model also shows that innovative pharmaceutical companies in China are changing from "authorized parties" to "co-developers/global partners", and the position of value chain is moving up.
From the perspective of industry and policy, China has listed innovative drugs as key industries, and continued to exert efforts in R&D support, approval channels, listing pricing, medical insurance and sea-going ability. The industrial base is changing from "catching up" to "running together" or even "leading".
The short-term cooling of the capital market is only a rhythm adjustment, from the high-speed sprint period to the steady pull-up period: less speculation and more landing; Less expectations and more evidence. Investors should pay attention to whether the enterprise has sustainable BD strength, pipeline landing ability and global vision, and distinguish between projects that are presented only by agreement and those that have entered the stage of global development+commercialization.
04、summary
If the popularity and fanaticism of the innovative medicine sector in the previous period is a "bubble" jointly created by capital and industry, today's callback is the only way for the industry to move towards quality development and value return.
For innovative drugs in China, the key is not whether they can go to sea, but whether they can explode, whether they can move from authorized income to independent commercialization and whether they can occupy a higher position in the global value chain. After shuffling, the innovative medicine sector will move to the next stage-farther, more stable and more qualitative.
As a senior analyst commented: "After the bubble is squeezed, what remains is gold."
reference data：
1.wind，Wanlian securities research institute
2.https://www.moomoo.com/news/post/58401537/a-single-regulatory-decree-cannot-hinder-industry-trends-many-institutions
3.https://dealforma.com/chinas-biotech-market-is-staging-a-comeback-that-us-biotech-can-only-wish-for/
4.Ge company official website
Disclaimer: This article is only for the purpose of knowledge exchange and sharing and popular science, and does not involve commercial propaganda, and is not used as relevant medical guidance or medication advice. If the article is infringing, please contact to delete it.
Our product recommendation:
1.151367-92-9 https://www.bicbiotech.com/product_detail.php?id=6429
2.29883-25-8 https://www.bicbiotech.com/product_detail.php?id=6430
3.138163-07-2 https://www.bicbiotech.com/product_detail.php?id=6431
4.607-19-2 https://www.bicbiotech.com/product_detail.php?id=6432
5.1206117-96-5 https://www.bicbiotech.com/product_detail.php?id=6433
