"Big Banks" Bank of America Securities: Mainland China's October drug sales growth rate significantly slowed month-on-month, with China National Pharmaceutical Group's target price lowered to 8.3 yuan

Bank of America Securities published a report indicating that in October, the total sales of sample drugs in the mainland pharmaceutical industry decreased by 3% year-on-year, a significant drop from the 6.8% year-on-year growth in September. Hospital channel sales fell by 3.3% year-on-year, compared to a growth of 7.1% previously. Retail channel sales in October were basically flat year-on-year, a noticeable slowdown from the 2.4% year-on-year growth in September.

The report stated that in October, HANSOH PHARMA (03692.HK) recorded the highest year-on-year growth among its peers at 8.6%. Most of HANSOH PHARMA's key products achieved double-digit month-on-month growth in October, except for PEG-loxenatide. The rating is maintained at "Buy," with a target price of HKD 45.

The report indicated that in October, several key products of Hengrui Pharma (01276.HK) faced pressure. The total sample sales in October grew by 2% year-on-year. Among them, butorphanol/ioversol/sevoflurane decreased by 49.1%, 0.5%, and 10.8% year-on-year, respectively. Rezvilutamide/henagliflozin saw year-on-year sales growth of 92.5% and 155.2%, respectively. The rating is maintained at "Underperform," with a target price of RMB 57.7 for Hengrui Pharma (600276.SH) A shares.

The report indicated that SINO BIOPHARM (01177.HK) had a differentiated performance in its product portfolio in October. Core products anlotinib/glycyrrhizic acid saw month-on-month sales growth of 6.5% and 4.4% year-on-year, respectively. However, budesonide/esomeprazole saw month-on-month sales decline of 28.5% and 39.4% year-on-year, with cumulative declines of 22.6% and 28.8% in the first ten months. Based on sales performance, the firm has lowered its sales forecasts for some products affected by VBP starting in 2026, and has reduced its revenue forecasts for 2026 and 2027 by 0.2% and 0.4%, respectively. The target price has been lowered from HKD 9.4 to HKD 8.3, while reiterating a "Buy" rating based on the significant licensing potential of its pipeline products.

Additionally, the firm indicated that CSPC Pharmaceutical (01093.HK) continued to experience sluggish sales for several key drugs in October, maintaining an "Underperform" rating with a target price of HKD 7.2