Financial Services Association, November 27 (Editor: Hu Jiarong) As the 2024 National Medical Insurance Drug Catalogue is about to be published, most Hong Kong pharmaceutical stocks have strengthened. As of press release, Keji Pharmaceutical-B (02171.HK), Nuochengjianhua (09969.HK), Kolumbotai Bio-B (06990.HK), and KEYMED BIO-B (02162.HK) rose 9.41%, 9.18%, 4.66%, and 3.67% respectively.

Note: Performance of pharmaceutical stocks

In terms of news, the National Health Insurance Administration plans to hold a press conference on November 28. At that time, it will announce the results of the 2024 national medical insurance drug catalogue adjustment and answer media questions.

Why do pharmaceutical companies pay so much attention to health insurance collection?

The first is an increase in sales: after entering the medical insurance catalogue, drug sales increased. In particular, the sales growth rate of products with moderate competition after entering medical insurance was higher than that of fiercely competitive products.

The second is commercialization support: For innovative pharmaceutical companies, entering the medical insurance catalogue is an important step in achieving commercialization goals. It helps enterprises recover R&D investment and further fund the innovative R&D activities of enterprises. Health insurance fund spending on innovative drugs has increased significantly over the past few years, from less than 6 billion yuan in 2019 to about 90 billion yuan in 2023, an increase of 15 times in four years.

In which fields are products expected to be shortlisted?

According to Ping An Securities, products in key areas of this year's national talks have been sorted out.

PD- (L) (immune drug for cancer treatment): This year, Yuheng Biotech's cypalizumab and Chia Tai Tianqing/Kang Fang Biotech (09926.HK) participated in negotiations. Hengrui Pharmaceuticals (600276.SH), Junshi Biotech (01877.HK), and BeiGene Shenzhou (BGNE.US) PD-1 negotiated new indications.

EGFR TKI: Shenghe Pharmaceutical's riotinib tablets and Beierda's rezitinib participated in negotiations this year, Betta Pharmaceuticals (300558.SZ) participated in negotiations for NSCLC first-line treatment with befotinib; the contract was renewed within the Jiangsu Hausen ametinib catalog.

Dual antibodies: Kang Fang Biotech (09926.HK) participated in this year's negotiations. Prior to the negotiations, Kang Fang reduced cardonilizumab (AK104, PD-1/CTLA4) from 13220 yuan/125 mg/vial to 6166 yuan/125 mg/vial, a reduction of 53.4%, and the annual treatment cost was less than 0.2 million yuan; the annual treatment cost of evorximab (AK112, PD-1/VEGF) was over 0.4 million yuan.

PSCK9 (lipid-lowering drug): Novartis Pharmaceuticals (NVS.US) Inkus Focus on Ejaculate and Cinda Biotech (01801.HK)'s tolecimab participated in this negotiation.

Hematoma TKI (tyrosine kinase inhibitors): Yasheng Pharmaceutical-B (06855.HK) participated in negotiations on additional indications for olevatinib (adult CML CP patients resistant to 1st and 2nd generation TKI); drugs outside the Digitinib capsule catalog of U (688192.SH) participated in negotiations.