According to statistics from PharmaCube, China's innovative drug sector completed 105 outbound licensing deals in the first half of the year, with total upfront payments reaching US$5 billion and potential total transaction value approaching US$100 billion, already close to last year's full-year level of US$135.7 billion. The full-year potential transaction value could exceed US$150 billion, though the final scale will still depend on the pace of subsequent deal closures.
In 2026, core product patents of major global pharmaceutical companies will expire in clusters. AbbVie, Eli Lilly, AstraZeneca, Sanofi, and Roche 鈥?these giants that once profited effortlessly from blockbuster drugs 鈥?now face enormous pressure from growth gaps. According to estimates, nearly 70 star drugs will lose patent protection globally over the next five years, facing the risk of approximately US$236 billion in lost annual sales. Large global pharmaceutical companies need to find new revenue sources on the scale of hundreds of billions of dollars to fill the disappearing patent income.
In January 2026, RemeGen announced that it had signed an exclusive licensing agreement with AbbVie for RC148, a novel PD-1/VEGF bispecific antibody drug independently developed by RemeGen. Leveraging the PD-1/VEGF bispecific antibody licensing deal with AbbVie (US$650 million upfront payment), RemeGen turned profitable year-on-year in the first three quarters. The company achieved operating revenue of approximately RMB 6.764 billion in the first three quarters, a year-on-year increase of 293.28%, with net profit attributable to shareholders of approximately RMB 5.273 billion.
In May 2026, Innovent Biologics announced a major global strategic collaboration with global pharmaceutical giant Pfizer, under which the two parties will conduct deep R&D and commercial binding around 12 high-potential early-stage oncology innovative drug projects. According to the agreement, Innovent Biologics will receive an upfront payment of US$650 million and is eligible for up to US$9.85 billion in R&D, regulatory, and commercialization milestone payments, bringing the total transaction value to US$10.5 billion. In the first half of 2026, Innovent Biologics achieved operating revenue of RMB 8.618 billion, a year-on-year increase of 44.76%; net profit attributable to shareholders was RMB 1.253 billion, a year-on-year increase of 50.20%.
In the same month, Hengrui Pharma reached a global strategic collaboration and licensing agreement with Bristol Myers Squibb to jointly advance 13 early-stage projects spanning oncology, hematology, and immunology. Under the agreement, the potential total transaction value of this collaboration could reach approximately US$15.2 billion, including a US$600 million upfront payment. In the first three quarters of this year, Hengrui Pharma achieved revenue of RMB 24.41 billion, a year-on-year increase of 5.3%; net profit attributable to shareholders was RMB 6.92 billion, a year-on-year increase of 20.4%. Revenue contribution from outbound licensing business steadily increased, with confirmed revenue from innovative drug outbound licensing business reaching RMB 2.78 billion in the first three quarters, a year-on-year increase of 31.1%.
Guosen Securities stated that domestic sales in the innovative drug sector are growing rapidly, and overseas markets are about to enter a dense commercialization phase. Most domestic innovative drug companies have entered the stage of medical insurance volume expansion for major products, driving rapid revenue growth; the second wave of innovation going overseas will also usher in a harvest period. In addition, Chinese innovative drugs have made progress in overseas clinical development and are about to enter the global commercialization stage. Guojin Securities stated that against the backdrop of patent expirations for core products of multinational pharmaceutical companies and continuously released demand for pipeline replenishment, it remains bullish on the trend of innovative drugs going overseas, recommending attention to active BD tracks such as bispecific antibodies, ADCs, and small nucleic acids, as well as innovative drug companies with dense clinical data catalysts and continuously advancing overseas collaborations. Innovative drug companies are about to reach a performance turnaround point, with dense clinical data catalysts throughout the year, coupled with smooth overseas clinical progress of outbound pipelines, making the sector's investment opportunities clear.
Related concept stocks: Hengrui Pharma (01276): In the first three quarters of this year, Hengrui Pharma achieved revenue of RMB 24.41 billion, a year-on-year increase of 5.3%; net profit attributable to shareholders was RMB 6.92 billion, a year-on-year increase of 20.4%. Revenue contribution from outbound licensing business steadily increased, with confirmed revenue from innovative drug outbound licensing business reaching RMB 2.78 billion in the first three quarters, a year-on-year increase of 31.1%. WuXi AppTec (02359): WuXi AppTec announced that third-quarter operating revenue was RMB 16.64 billion, a year-on-year increase of 38.01%; net profit attributable to shareholders of the listed company was RMB 8.318 billion, a year-on-year increase of 136.67%. Innovent Biologics (01801): In the first half of 2026, Innovent Biologics achieved operating revenue of RMB 8.618 billion, a year-on-year increase of 44.76%; net profit attributable to shareholders was RMB 1.253 billion, a year-on-year increase of 50.20%. Pharmaron (03759): In the third quarter of 2026, the company achieved operating revenue of RMB 4.408 billion, a year-on-year increase of 20.94%; net profit attributable to shareholders of the listed company was RMB 497 million, a year-on-year increase of 13.06%. In the first three quarters of 2026, the company's newly signed orders increased by more than 30% year-on-year. Among them, newly signed orders in the laboratory services segment increased by more than 25% year-on-year, newly signed orders in the CDMO services segment increased by more than 40% year-on-year, and newly signed orders in the clinical research services segment increased by more than 25% year-on-year.
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