Innovative drugs have received a significant boost! According to an announcement on January 12, the company signed an exclusive licensing agreement for RC148—a novel bispecific antibody drug targeting PD-1/VEGF—with a total potential deal value of up to $5.6 billion (approximately RMB 39 billion), including an upfront payment of $650 million. Boosted by this news, Rongchang Biologics' A-shares surged by the 20% daily limit, while its Hong Kong-listed shares jumped nearly 10%.
Brokerage statistics indicate that five Business Development deals in the innovative drug sector were finalized within a single week. On January 12 alone, three major events occurred in the second-generation immuno-oncology therapy space. Driven by these developments, innovative drugs became the market's focal point today. The Hong Kong-listed innovative drug and broader healthcare sectors rallied across the board, with some stocks soaring over 46% at one point. Others rose approximately 8%, while a company surged nearly 8% following a positive profit alert. Several other stocks also followed the upward trend.
Rongchang Biologics Receives a Major Catalyst On the evening of January 12, Rongchang Biologics announced that on January 12, 2026, it had entered into an exclusive licensing agreement with an affiliate of AbbVie Group for RC148. RC148 is a novel bispecific antibody drug targeting PD-1/VEGF developed by Rongchang Biologics. Under the agreement, AbbVie will obtain exclusive rights to develop, manufacture, and commercialize RC148 outside the Greater China region. Upon receiving the necessary regulatory approvals, Rongchang Biologics will receive an upfront payment of $650 million and is eligible for up to $4.95 billion in development, regulatory, and sales milestone payments, plus tiered double-digit royalties on net sales outside Greater China. Since its listing in Hong Kong in 2020, Rongchang Biologics has previously announced three out-licensing deals. However, both the upfront payment and the total potential value of this latest BD transaction with AbbVie set a new record for the company. Furthermore, reports indicate that AbbVie is the largest company by market capitalization that Rongchang Biologics has partnered with. According to the 2025 "Pharm Exec 50" ranking of global pharmaceutical companies by Pharmaceutical Executive magazine, AbbVie's prescription drug sales for fiscal year 2024 reached $54.484 billion, ranking second globally, trailing the leader Johnson & Johnson by only about 2%. Notably, three significant events occurred yesterday involving core Chinese innovative drug assets in the second-generation IO therapy space. First was the announcement of Rongchang Biologics' major and better-than-expected BD deal. Second was the Biologics License Application submission for AK112 in the U.S. by Akeso Biopharma/Summit. Third was the plan by 3SBio/Pfizer to initiate five global multi-center Phase III clinical trials for PF-08634404/SSGJ-707 in 2026. Some analysts believe the global competitiveness of the second-generation IO pipeline is promising. Five BD Deals Landed in One Week A brokerage report stated that five BD deals in the innovative drug sector were finalized within a week. The collaborative projects spanned various technologies, including small molecule inhibitors, monoclonal antibodies, bispecific antibodies, Antibody-Drug Conjugates, and Radiopharmaceutical Drug Conjugates, demonstrating China's leading global positioning across multiple technological fronts. On January 9, YLB's B7H3 ADC was licensed to Roche, fetching a $570 million upfront and near-term milestone payment, currently in Phase 3 in China. Also on January 9, Haisco's PDE3/4 dual inhibitor partnered with U.S.-based AirNexis Therapeutics for a $108 million upfront payment and a total potential deal value exceeding $1 billion, currently in Phase II in China. On January 12, ZSPEIRC's RDC was licensed to Novartis, at the preclinical stage. On January 12, Rongchang Biologics' PD-1/VEGF bispecific antibody deal with AbbVie included a $650 million upfront and a total potential value of $5.6 billion, currently in Phase 2 in China. Also on January 12, SciNeuro's Aβ antibody was licensed to Novartis for a $165 million upfront and a total potential deal value of $1.665 billion, at the preclinical stage. Institutional analysis suggests that since the Hong Kong innovative drug index hit its annual high in September 2025, it had corrected by 24% by the end of 2025. In contrast, the U.S. biotech index XBI gained 29% over the same period, and the NBI index rose 18%. The XBI index has rebounded over 100% from its late-April 2025 low, with large multinational corporations generally recovering 30% to 50% from their bottoms, and Eli Lilly's market capitalization surpassed $1 trillion for the first time. This highlights a significant valuation divergence between U.S. and Chinese innovative drug assets, with the gap widening notably after September 2025. While current valuations for Hong Kong-listed innovative drug stocks are not at historical lows, they remain highly attractive compared to their global peers.
