<div id="readability-page-1" class="page">Mainland Chinese investors can now buy shares in more than a dozen newly added Hong Kong-listed biotech and pharmaceutical companies after a reshuffle of the Stock Connect southbound trading list took effect on Monday, reflecting the sector’s growing role on the international stage. Foreign capital, however, remained cautious, analysts said. “Mainland buyers have been the main force behind the latest healthcare rally. They tend to chase smaller-cap names where a tight free float makes it easier to push prices higher,” said Jonah Chen, head of healthcare research at China Merchants Securities (Hong Kong). “They are also getting excited by a surge in big-ticket out-licensing deals.” Overseas funds were still wary of China’s biotech sector, said Chen, who has a PhD in pathology. “They tend to cherry-pick a few big-cap pharmaceutical companies with strong pipelines and truly innovative drug target design, rather than buying the sector broadly.” His comments came as at least 13 healthcare companies – including AI-driven drug discovery firm Insilico Medicine, innovative drug maker Xuanzhu Biopharmaceutical, and CARsGen Therapeutics, developer of cutting-edge cancer treatment CAR-T cell therapy – were among 42 stocks added to the southbound list, according to an exchange filing with the Shanghai Stock Exchange. The southbound leg of Stock Connect allows mainland Chinese investors to buy and sell shares listed in Hong Kong through the Shanghai and Shenzhen exchanges.  Shares of Insilico Medicine had jumped more than 58 per cent to HK$59.45 as of Monday, after striking a string of out-licensing deals in recent months. Xuanzhu’s shares have been volatile this year. They climbed to as high as HK$77.45 before closing at HK$54.15 on Monday. CARsGen Therapeutics also swung from a peak of HK$16.57 before falling to a year-to-date low of HK$10.87. Hang Seng Healthcare Index has gained 0.2 per cent this year, while the Hong Kong stock benchmark Hang Seng Index has dropped 3.53 per cent. Global equity funds were 6.5 per cent underweight China, compared with a post-Covid-19 average of 5.5 per cent, according to a January report from Franklin Templeton. The Chinese biotech sector was witnessing significant growth as international acceptance of Chinese clinical data boosted investor confidence, it said. The Chinese government has elevated the importance of the biotech sector. In the 2026 government work report delivered on March 5, biomedicine was for the first time listed as an “emerging pillar industry” alongside integrated circuits, aerospace and the low-altitude economy. In an official announcement published in November, Beijing named 43 companies and research institutes in the first batch of pilot-scale manufacturing platforms as part of efforts to upgrade and expand its nationwide biomanufacturing ecosystem. Global funds have been building positions in some of China’s largest biotech companies over the past decade. BlackRock, the world’s largest asset manager, held a 5.76 per cent stake in Innovent Biologics as of January 23. Singaporean sovereign wealth fund GIC invested in Jiangsu Hengrui Pharmaceuticals – China’s biggest listed drug maker by market value – and Harbour BioMed. They have reaped rewards as Chinese biotechs have enjoyed huge success in licensing their early-stage drug candidates to global pharmaceutical giants since last year. The momentum has accelerated in both the size and value of those deals. One of the latest was Sino Biopharmaceutical’s agreement with France’s Sanofi worth up to US$1.53 billion.</div>

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<p>Mainland Chinese investors can now purchase shares in over a dozen newly added Hong Kong-listed biotech companies following a reshuffle of the Stock Connect southbound trading list. Analysts note that while mainland buyers are driving the healthcare rally, foreign capital remains cautious, focusing on select large-cap firms. Notable companies added include Insilico Medicine and CARsGen Therapeutics. Insilico's shares surged over 58% after recent out-licensing deals. The Chinese biotech sector is gaining international recognition, with the government emphasizing its importance as an emerging industry.</p>

SCMP

CARSGEN-B

Guotai CSI Bio-medicine ETF

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ChinaAMC SSE STAR Biology and Medicine ETF

E Fund CSI Biotechnology Theme ETF

China Merchants CSI Biotechnology Theme ETF

Bosera Hang Seng SCHK Innovative Drug Select ETF

Hwabao WP Hang Seng SCHK Innovative Drug Select ETF

Huaan Hang Seng Biotech ETF

Yinhua CSI Innovative Drugs Industry ETF

Penghua SSE STAR Biology and Medicine ETF

Fullgoal Hang Seng SCHK Innovative Drug & Healthcare ETF

Minsheng Royal CSI Biotechnology Theme ETF

China investors energise Hong Kong biotech stocks. Is foreign money missing out?