HK 18A Biotech Firms Post RMB14.2B Profit in H1 2026; Out-Licensing Deals Hit Record

Disclosure of interim results for the Hong Kong 18A biotech sector is nearing completion. As of the first half of 2026, 17 companies had achieved profitability, close to a quarter of the entire sector, with cumulative profits of approximately RMB14.221 billion. It took the sector more than three years to move from the first company crossing the breakeven point to a wave of profitability.

The top five companies by profit were RemeGen, BeiGene, Innovent Biologics, KeyMed Biosciences, and Clover Biopharmaceuticals, posting profits of RMB4.662 billion, RMB3.271 billion, RMB1.253 billion, RMB1.218 billion, and RMB955 million, respectively. Eight companies—Jacobio Pharmaceuticals, Harbour BioMed, Henlius, Kelun-Biotech, Biocytogen, InnoCare Pharma, Antengene, and Qyuns Therapeutics—each reported profits exceeding RMB100 million. Four companies—Mabpharm, Lepu Biopharma, Junshi Biosciences, and Raynovent Biotech—recorded profits ranging from RMB20 million to RMB40 million.

Among them, KeyMed, Clover Biopharmaceuticals, and Junshi achieved profitability for the first time, while BeiGene, Innovent, Harbour BioMed, Henlius, and InnoCare posted consecutive profits. BeiGene's H1 2026 profit significantly exceeded its full-year 2025 profit of RMB1.416 billion, driven mainly by sales growth of its self-developed products Brukinsa and Tevimbra, as well as products licensed from Amgen. Clover's profit was attributed to non-recurring gains from a settlement agreement with GAVI, the Vaccine Alliance. Most profitable companies currently benefit from a dual engine of proprietary product sales and licensing revenue.

Looking back at H1 2023, Henlius became the first 18A biotech company to achieve profitability. By H1 2026, the number of profitable companies had expanded to 17. According to data from the National Medical Products Administration, in 2025, the total value of out-licensing deals for Chinese innovative drugs exceeded USD130 billion, with more than 150 transactions. In H1 2026, out-licensing deal value reached approximately USD110 billion, equivalent to 80% of the 2025 full-year total.

Since 2021, China's innovative drug industry has undergone a shift in the capital cycle. A cooling capital market has put many biotech companies under cash-flow pressure, making the traditional "financing-burn-listing" path unsustainable. Companies have turned to product out-licensing and strategic partnerships to secure R&D funding. Meanwhile, multinational pharmaceutical companies, facing patent cliffs, urgently need to expand their product pipelines. These dual factors have fueled the boom in out-licensing deals for Chinese innovative drugs. Related research shows that the share of China biopharma collaboration deals in the potential value of comparable deals in Europe and the US rose from about 8% in 2020 to 34% in 2025.

Among the profitable companies, product sales are growing. BeiGene's net profit attributable to shareholders in H1 2026 increased 6.27 times year-on-year. While product revenue drove overall growth, selling expenses rose only 4.4%, with a selling expense ratio of 23.59%, down 5.1 percentage points from the same period in 2025. Innovent reported total revenue of RMB8.618 billion in H1 2026, up 44.8% year-on-year, of which product revenue was RMB8.202 billion, up 56.7%. Marketing, sales, and promotion expenses were RMB3.226 billion, accounting for 37.5% of total revenue, down 2.4 percentage points from the same period in 2025. InnoCare generated revenue of RMB1.14 billion in H1 2026, up 55.5% year-on-year, with drug revenue of RMB920 million, up 43.2%, mainly driven by continued growth of orelabrutinib and new contributions from tafasitamab and zorecetraxib. Selling and distribution expenses were RMB269 million, up 9.4%.

A new drug application for orelabrutinib in primary immune thrombocytopenia has been accepted by the National Medical Products Administration, marking the first accepted NDA for this drug in the autoimmune disease field. Junshi reported total revenue of RMB1.696 billion in H1 2026, up about 45% year-on-year, with domestic revenue from its PD-1 product toripalimab reaching RMB1.299 billion, up about 36%. Selling and distribution expenses were RMB507 million, up about 4% year-on-year.