【Zhenzhuo Institutional View】Hengrui Medicine (01276.HK): Net profit grows by nearly 30%

$HENGRUI PHARMA(01276.HK) reported strong performance in the first half of 2025, achieving operating revenue of 15.761 billion yuan, a year-on-year increase of 15.88%, and net profit attributable to shareholders of listed companies reached 4.45 billion yuan, an increase of 29.67%. The sales and licensing income of the company's innovative drugs increased significantly, reaching 9.561 billion yuan, accounting for more than 60% of total revenue. Several core products received high recognition in clinical trials, driving continuous sales growth; at the same time, the company's collaborations with international pharmaceutical giants such as Merck and GSK brought in hundreds of millions of yuan in licensing income, becoming a major engine for performance growth. Facing the challenges of volume-based procurement of generic drugs, the market expansion of high-quality new products effectively offset some of the revenue decline.

The company continued to invest in its R&D pipeline and technology platforms, launching six Class I innovative drugs in the first half of 2025, covering fields such as oncology, metabolism, and immunology. R&D expenses reached 3.228 billion yuan, dedicated to improving clinical conversion efficiency and diversifying product portfolios. The company possesses multiple advanced technology platforms, including PROTAC, ADC, and bispecific antibodies, and actively utilizes AI and structural biology to advance drug development. Internationalization strategies also made progress, with products advancing multicenter clinical trials in the U.S., Europe, and Asia, accelerating global launch and strengthening competitiveness in international markets.

The company strengthened compliance and quality management, passing multiple domestic and international GMP inspections and environmental safety measures to ensure stable supply and reliable product quality. Financial conditions are healthy, with monetary funds exceeding 36 billion yuan at the end of the period and a debt-to-asset ratio of about 6.1%, maintaining ample cash flow to support continuous R&D and global business expansion.

Source: KGI Securities