JPMorgan: National Reimbursement Drug List Updates Accelerate Commercialization of Innovative Drugs, Top Picks Include Innovent Bio (01801)

Stock News05-12

JPMorgan released a research report stating that the National Healthcare Security Administration has published the "Work Plan for Adjusting the 2026 National Basic Medical Insurance, Maternity Insurance, Work-Related Injury Insurance Drug List and the Commercial Health Insurance Innovative Drug List (Draft for Comments)," introducing several market-friendly rule changes. These are expected to further improve the commercial prospects for Chinese innovative drug developers and their CXO partners. The bank believes the most significant change is the first-time allowance for drugs to submit applications for inclusion in the National Reimbursement Drug List (NRDL) before receiving formal marketing approval. This is anticipated to drastically shorten the time gap between drug approval and NRDL inclusion, historically one to two years. Furthermore, the new plan formally establishes a linkage mechanism between commercial insurance and the NRDL, creating a model of "commercial insurance first, national insurance follows." This opens the door for high-priced innovative drugs that previously struggled to enter the NRDL due to pricing concerns. JPMorgan stated that the pre-application mechanism serves as a direct catalyst for innovative drug companies with assets in the NDA review stage or nearing NDA. Earlier inclusion in the NRDL means faster sales growth and clearer revenue visibility. The report notes that the formal establishment of a bridging pathway from commercial insurance to the NRDL validates the dual-listing strategy pursued by many innovative drug companies. The new rules are particularly meaningful for drugs currently covered by commercial insurance but not yet included in the NRDL, as their retail prices have historically exceeded the acceptable range for NRDL negotiations. The bank believes that clear renewal rules will provide innovative drug companies with a more transparent long-term pricing roadmap, and the accelerated commercialization process for Chinese innovative drugs will directly benefit their CXO partners. JPMorgan reiterated its positive view on Innovent Bio (01801), Kelun-Bota Biopharma (06990), WuXi AppTec (02359), and WuXi XDC (02268), listing them as top picks in the sector.

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