The inaugural Global Conference of National Innovative Medicines (CPIC 2026) officially opened yesterday at the National Exhibition and Convention Center in Shanghai. Following an era of generic drug accumulation and Me-too/Me-better follow-on innovation, the independent research and development of First-in-Class (FIC) novel drugs has become a core direction for the domestic pharmaceutical industry. After multiple rounds of professional review, seven FIC drugs with breakthrough potential received the CPIC Original Innovation Drug Award, directly reflecting the continued enhancement of China's innovation capabilities.
Simultaneously, the wave of global collaboration in innovative drugs is intensifying, with domestic biotech firms recently signing licensing agreements with major overseas pharmaceutical companies. On July 2, a leading domestic company formed a collaboration with AstraZeneca on siRNA drug development, securing a $30 million upfront payment with a potential milestone value of up to $1.74 billion. On July 8, another company out-licensed a PDE3/4 inhibitor, receiving a $200 million upfront payment with potential milestones of up to $1.9 billion. According to statistics from PharmCube, as of July 21, the total value of out-licensing deals for domestic innovative drugs this year has reached $109.9 billion across 140 transactions, with aggregate upfront payments of $5.9 billion. The total transaction value and upfront payment scale have already achieved 79% and 82% of the full-year 2025 levels, respectively.
Looking at the full year, "independent innovation plus global expansion" remains a core theme driving the innovative drug sector. Amidst the industry's rising temperature, trading activity for related on-market products continues to heat up. As the only ETF on the entire market currently tracking the Hang Seng Innovative Drug Index, Huatai-PineBridge Hang Seng Innovative Drug ETF (520500) has seen its daily trading volume exceed 20 billion yuan for 15 consecutive trading sessions, with an average daily volume of 3.026 billion yuan during the period. This represents a significant expansion compared to the average daily volume of 1.133 billion yuan since the beginning of the year. As of the latest update, the product's share count and fund size have climbed to 2.37 billion shares and 3.42 billion yuan, respectively, highlighting its superior liquidity advantage.
From a trend perspective, the accelerated launch of China's innovative drug achievements continues, with several landmark clinical results being released. On July 21, a selective orexin 2 receptor agonist was officially approved for market, adopting a global synchronized R&D and filing model, achieving the first submission and approval of a novel target drug in the Chinese market. Over a longer timeframe, the first half of 2026 saw the approval of 38 innovative drugs, with domestic varieties accounting for 31. This includes "global firsts" such as the world's first anti-hepatitis D antibody and the world's first solid tumor CAR-T therapy. Breaking it down further, all 11 drugs with new targets and mechanisms approved in the first half were independently developed by domestic companies. Compared to just 4 domestically developed new-target drugs in all of 2025, China's innovative drug R&D capabilities have significantly improved.
Top-level policies continue to be reinforced, constantly unclogging commercialization channels for innovative drugs. The National Essential Drug List (2026 Edition), revised for the first time in eight years, was released on July 9, incorporating 16 innovative drugs, including 4 domestic Class 1 new drugs. This marks a historic breakthrough for innovative drugs entering the Essential Drug List. On July 13, the State Council issued the "Fifteenth Five-Year Plan for National Health," explicitly proposing the construction of a full-chain support system centered on innovative drugs and medical devices. The continuous rollout of such policies is expected to foster a more favorable industrial environment for the R&D, approval, and clinical promotion of innovative drugs.
It is reported that the Huatai-PineBridge Hang Seng Innovative Drug ETF (520500) closely tracks the Hang Seng Innovative Drug Index. This index invests in 40 leading Hong Kong-listed innovative drug companies via the QDII mechanism, primarily focusing on mid-to-upstream innovative drug fields such as biopharmaceuticals, chemical pharmaceuticals, and APIs. It assembles a group of R&D-driven enterprises with strong R&D capabilities and growth potential. With its large scale, superior liquidity, and support for on-market T+0 trading, this ETF may serve as a convenient tool for positioning in Hong Kong-listed innovative drug opportunities against the backdrop of BD deal monetization, inflection points in profitability, and policy support.
The manager of the Huatai-PineBridge Hang Seng Innovative Drug ETF (520500), Huatai-PineBridge Fund Management, is one of the first batch of ETF managers in China. With over 19 years of experience in index investing, it has provided investors with transparent, conveniently tradeable, and low-cost index tools such as the CSI 300 ETF (510300) and the CSI A500 ETF (563360). As of the end of June 2026, the company's ETFs have accumulated profits of over 180.6 billion yuan for holders in the past two years, making it one of only three public fund companies in the entire A-share market to have accumulated profits exceeding 160 billion yuan in the same period.