--- title: "Hong Kong pharmaceutical stocks have continued to experience deep corrections, with AKESO falling over 4%! The Hong Kong Connect Innovative Drugs ETF (159570) has dropped over 2%! The high prosperity of innovative drug BD going overseas continues, and overseas biopharmaceutical investment and financing are warming up" type: "News" locale: "en" url: "https://longbridge.com/en/news/277734255.md" description: "Hong Kong stocks fluctuated lower today, with the innovative drug sector retreating again. The Hong Kong Connect Innovative Drugs Industry ETF (159570) fell over 2%, hitting a new low since last year. Stocks such as AKESO and 3SBIO also experienced declines. Analysts believe this adjustment is mainly due to funding and trading behavior, although the fundamentals remain unchanged, and the outlook for quality pharmaceutical companies is still positive. The extreme reversal in market sentiment has led to increased liquidity pressure, and the allocation value of innovative drugs is expected to improve in the future" datetime: "2026-03-04T06:09:12.000Z" locales: - [zh-CN](https://longbridge.com/zh-CN/news/277734255.md) - [en](https://longbridge.com/en/news/277734255.md) - [zh-HK](https://longbridge.com/zh-HK/news/277734255.md) --- > Supported Languages: [简体中文](https://longbridge.com/zh-CN/news/277734255.md) | [繁體中文](https://longbridge.com/zh-HK/news/277734255.md) # Hong Kong pharmaceutical stocks have continued to experience deep corrections, with AKESO falling over 4%! The Hong Kong Connect Innovative Drugs ETF (159570) has dropped over 2%! The high prosperity of innovative drug BD going overseas continues, and overseas biopharmaceutical investment and financing are warming up Today (March 4), Hong Kong stocks fluctuated lower, and innovative drugs once again retreated. The **100% pure innovative drug Hong Kong Stock Connect Innovative Drugs ETF (159570)** fell over 2%, marking the fifth consecutive day of decline, reaching a new low since June 4 of last year! The intraday trading quickly surpassed 1.4 billion yuan! The latest scale exceeds 22.5 billion yuan, leading its peers by a wide margin! As of 13:40, **the Hong Kong Stock Connect Innovative Drugs ETF (159570) underlying index weighted stocks mostly showed declines:** AKESO and 3SBIO fell over 4%, CSPC Pharmaceutical Group and Innovent Biologics fell over 3%, BeiGene and Hansoh Pharmaceutical fell over 2%, and China National Pharmaceutical Group fell over 1%. Note: The underlying index weighted stocks are for display purposes only and do not constitute individual stock recommendations. **【What are the reasons for the continuous adjustment of innovative drugs? Pay attention to important meetings!】** In the absence of significant changes in fundamentals, the innovative drug sector has continued to adjust after the holiday. Institutional views suggest that **this adjustment is mainly due to capital and trading behavior, and the investment logic of the innovative drug sector remains unchanged.** High-quality pharmaceutical companies have favorable fundamentals and vast potential, and valuations are gradually entering an attractive range. **Currently, it is a “rational decline under certain growth.”** In the future, as AI narratives tend to become overheated and the congestion of hard asset transactions continues to increase, **the allocation value of innovative drugs in asset portfolios is expected to further improve.** Specifically, the reasons for the phase adjustment of innovative drugs are as follows: **1\. Overall weakness of Hong Kong stocks:** Since February, the Hang Seng Index and Hang Seng Tech Index have shown significant pullbacks. The innovative drug index was relatively resilient earlier, but it began to catch up on declines after February 23. **2\. Profit-taking and technical selling mutually reinforce:** Last year's BD boom led to a significant rise in the index, but after the fourth quarter, there was a lack of catalysts. Coupled with geopolitical risks, southbound capital reduced allocations in pharmaceuticals and shifted to technology and energy, causing liquidity pressure, which triggered programmatic stop-losses and emotional sell-offs. **3\. Extreme reversal of trading sentiment:** The market excessively speculated on BD down payments in 2025 and even speculated on merger rumors. Entering 2026, major MNCs are increasing early research in China, and BD transactions are showing an early trend. However, the market overlooked the essential changes in the industry, believing that the early BD realization cycle is long, thus assigning low or even zero valuations, indicating that trading sentiment has shifted to another extreme. **CICC also believes that despite the market experiencing phase adjustments, the innovative main line remains.** After the Spring Festival, recent external circumstances have affected liquidity expectations, leading to certain volatility in the stock prices of innovative drugs and other technology-oriented assets. However, CICC pointed out that **short-term market fluctuations do not change the development trend of the innovative drug industry.** Benefiting from the domestic engineer dividend, abundant clinical resources, and supportive policies, domestic innovative drugs have gradually shifted from following research and development to FIC/BIC innovation. In the field of emerging technology platforms, it is expected that there will be greater attention in the sector by 2026. It is recommended to focus on sub-sectors such as small nucleic acids. **Coinciding with important meetings and earnings report season, it is advisable to moderately pay attention to dividend-related assets and commercial insurance.** Important meetings are scheduled to be held on March 4 and March 5. Insufficient domestic demand under pressure from the payment side is one of the main contradictions in the domestic pharmaceutical industry. Given that commercial insurance has made some progress over the past year or so, it is recommended to pay attention to relevant reform directions. In terms of investment and financing, **benefiting from the prosperity of innovative drugs represented by Hong Kong stocks 18A since the beginning of 2025, the market's investment and financing have significantly reversed the downturn of the past 3-4 years.** The improvement in investment and financing is expected to stimulate a new round of investment in innovative drug research and development, driving an improvement in related industry orders. (Source: "CICC Pharmaceuticals March Portfolio: Innovative Drugs as the Main Line, Focus on Important Meetings") **【The high prosperity of innovative drug BD going overseas continues, and overseas biopharmaceutical investment and financing are recovering】** **Recently, the catalysts in the pharmaceutical and biotechnology sector have continued to accumulate, and the licensing transactions of Chinese innovative drugs abroad remain the current core focus.** According to the NextPharma database, as of February 25, 2026, there have been 44 License-out transactions of Chinese innovative drugs this year, with an upfront payment of approximately USD 3.123 billion and a total amount reaching USD 53.276 billion. **The cooperation model has shifted from single molecule licensing to "technology platform + multi-project portfolio + joint research and development,"** reflecting that multinational pharmaceutical companies' recognition of Chinese pharmaceutical companies is upgrading from asset cost-effectiveness to systematic pricing based on underlying research and development capabilities, early conversion efficiency, and platform extensibility. At the same time, **the overseas biopharmaceutical financing environment is marginally recovering, and the IPO window for U.S. biotechnology has become active again in early 2026,** with funding preferences further concentrating on clinical-stage assets with clinical data, clear catalysts, and commercialization paths. Great Wall Guorui Securities believes that this not only confirms that the global innovative capital market's risk appetite is improving but also is expected to provide spillover support for innovative drugs and the innovative industry chain from the perspectives of valuation mapping and financing expectations. (Source: Great Wall Guorui Securities 20260302 "The high prosperity of innovative drug BD going overseas continues, and the overseas biopharmaceutical investment and financing environment is recovering") **【What is the fundamental situation of innovative drugs in 2026? "Mistakenly killed is an opportunity"?】** **In the first two months of 2026, stock prices were flat, but BD transactions exploded with increased value.** In January-February, the upfront payments and total amounts of Chinese pharmaceutical companies' BD transactions abroad accounted for 86% and 81% of the global total, respectively, achieving comprehensive leadership. \*\*The explosive growth of BD transactions in January-February totaled USD 44.6 billion, far exceeding the first quarter of last year (USD 36.9 billion). The upfront payments have significantly increased, reflecting the enhancement of value: in January-February, it reached USD 2.9 billion, several times the growth compared to the first quarter of last year (USD 900 million) **In addition, the treatment field is flourishing, with large transactions in oncology concentrated in 2025, but the proportion has declined since the third quarter, while the non-oncology field is rapidly rising, indicating a "flourishing" treatment sector.** **Institutions point out that the current market misalignment lies in the hype around BD transactions landing, with BD landing being realized immediately, while neglecting the more valuable post-listing sales sharing (long-term continuous cash flow).** According to IQVIA, the global pharmaceutical market size is expected to be approximately USD 1.54 trillion by 2028 (including oncology, autoimmune, metabolic, etc.). In a conservative scenario, assuming Chinese pharmaceutical companies hold a 20% market share, this corresponds to an income of about USD 300 billion. Compared to the domestic medical insurance payment amount for innovative drugs in 2025 (approximately RMB 200 billion, half of which are imported drugs), **there is long-term growth potential of several tens of times in the overseas market**. **Institutions believe that the market lacks confidence in the commercialization capabilities of Chinese pharmaceutical companies, rooted in a failure to understand the essential changes in the industry:** **1\. Ten-Year Transformation:** From 2015, when China had almost no innovative drugs of its own, to 2025, when China has become one of the top three sources of innovative drug molecules globally, as well as a global early research center and early clinical center. Pharmaceutical companies have fully shifted to the "In China for global" strategy, with all projects planned from a global perspective. **2\. China's Advantages Overwhelm Europe and America:** In the early research and clinical early stages of drug development, China "overwhelms" Europe and America in terms of talent density, work intensity, and industrial chain support efficiency. According to McKinsey data, Chinese innovative pharmaceutical companies can be 2-3 times faster than international peers in the **preclinical drug discovery phase, with costs only 1/3 to 1/2; the patient enrollment speed in the clinical development phase is 2-5 times faster (with metabolic indications reaching 8.9 times)**. This structural advantage overwhelms European and American peers and has not yet been fully priced. **3\. Industry Position from Participation to Leadership:** The development speed and acceleration of the Chinese pharmaceutical industry over the past decade have been astonishing, with its progress slope comparable to that of other industries such as new energy vehicles. The CEO of Pfizer once commented that the Chinese pharmaceutical industry has passed the critical point of "being pushed back" and is catching up at twice the speed of the United States. **\[Focus on the hard-core innovative drug strength of China, representing new productive forces, and recognize the Hong Kong Stock Connect Innovative Drug ETF (159570)\]** **The Hong Kong Stock Connect Innovative Drug ETF (159570) targets an index that is 100% focused on innovative drugs! As of February 27, the top ten constituent stocks account for 73.54%, concentrating the essence of Hong Kong Stock Connect innovative drugs!** **The underlying index of the Hong Kong Stock Connect Innovative Drug ETF (159570) is more elastic in innovation drugs. As of February 13, it has risen over 70% since the second half of 2023, leading the Hong Kong pharmaceutical index!** 2023/7/1-2026/2/13 **The underlying assets are Hong Kong stocks, and T+0 trading is available!** **Focus on China's hardcore innovative drug strength, representing new productive forces, and recognize the Hong Kong Stock Connect Innovative Drug ETF (159570), with off-market connections (Class A: 021030; Class C: 021031)!** Risk Warning: Funds carry risks, and investment requires caution. The individual stocks mentioned in this article are only presented as objective representations of index constituent stocks and do not constitute any investment advice. Any opinions, analyses, and forecasts in this article do not constitute any form of investment advice to the reader. The Hong Kong Stock Connect Innovative Drug ETF (159570) is classified as a higher risk level (R4) product, suitable for investors whose risk level assessment results are aggressive (C4) or above. This fund's investment scope includes Hong Kong stocks and may face unique risks arising from differences in investment environment, investment targets, market systems, and trading rules. When investors subscribe/redeem ETF fund shares, the subscription and redemption agent brokers may charge a commission of no more than 0.50%, which includes relevant fees charged by securities exchanges, registration agencies, etc. For other funds' sales fees, please refer to the corresponding fund's prospectus, product summary, and other legal documents. When investors subscribe/redeem ETF fund shares, the subscription and redemption agent brokers may charge a commission of no more than 0.50%, which includes relevant fees charged by securities exchanges, registration agencies, etc. For other funds' sales fees, please refer to the corresponding fund's prospectus, product summary, and other legal documents. The underlying index of the Hong Kong Stock Connect Innovative Drug ETF (159570) is the China Universal CNI Hong Kong Connect Innovative Drug Index, which has recorded the following annual returns over the past five complete years (2021-2025): -21.59%, -25.60%, -22.80%, -10.50%, 59.83% ### Related Stocks - [3SBIO (01530.HK)](https://longbridge.com/en/quote/01530.HK.md) - [China Universal CNI HK Connect Innovative Drugs Industry ETF (159570.CN)](https://longbridge.com/en/quote/159570.CN.md) - [AKESO (09926.HK)](https://longbridge.com/en/quote/09926.HK.md) ## Related News & Research - [CICC Remains a Buy on Akeso, Inc. 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