According to Goldman Sachs' latest macro assessment released in August, market expectations for a Federal Reserve rate cut in September are heating up, potentially attracting more global capital into Hong Kong's biotech sector, which is undergoing valuation adjustments. Recent domestic pharmaceutical policy updates have signaled optimization of the payment system, potentially further unleashing the commercialization potential of high-quality pharmaceutical companies. Under multiple positive catalysts, this round of Hong Kong biotech valuation recovery is bound to be a long-term process with strong certainty. In this context, pharmaceutical companies with mature integrated R&D, production, and sales structures as well as international development capabilities are expected to continue receiving market attention.

Taking AB&B BIO-TECH-B (02627) as an example, since its listing, the company has gained high recognition from the capital market through systematic advantages formed across multiple aspects including innovative R&D, overseas registration, quality control, and market commercialization. On August 11, AB&B BIO-TECH-B was listed on the Hong Kong Stock Exchange, with its share price soaring nearly 170% on the first day, setting the highest first-day gain record for Hong Kong IPOs in 2024. Just half a month after listing, the company's peak market capitalization successfully exceeded HK$20 billion.

In fact, AB&B BIO-TECH-B's continuously rising stock price trend represents the most concrete manifestation of this round of Hong Kong innovative drug bull market. Although there have been recent technical fluctuations, combined with the company's latest disclosed 2024 interim results showing revenue growth of over 900% year-on-year, its stock price and market value still have enormous room for continued growth.

**Exploring the "Investment Certainty" Behind Core Innovation Technology**

The current capital market performance essentially reflects the phased achievements of AB&B BIO-TECH-B's strategy of deeply cultivating innovative vaccines. The key vehicle is the core product gradually gaining commercial validation—the quadrivalent influenza virus subunit vaccine Huierkangxin®.

On August 28, AB&B BIO-TECH-B announced its 2024 interim results. During the reporting period, AB&B BIO-TECH-B achieved revenue of RMB 71.123 million, a substantial year-on-year increase of 919.25%. This demonstrates that the company's core product Huierkangxin®'s significant clinical value and product strength have gained recognition in the terminal market.

In peer comparison, several biologics listed companies including Walvax Biotechnology, CanSino Biologics, and Kangmei Pharmaceutical recently released their 2024 semi-annual reports. Among them, Walvax Biotechnology's revenue decreased 38.25% year-on-year with net profit declining 155.30%; CanSino Biologics has no vaccine products commercialized yet, remains unprofitable, and expects continued losses from January to September this year; Kangmei Pharmaceutical's revenue increased 15.81% year-on-year while net profit declined 77.30%. Evidently, compared to peers still facing a "performance winter," AB&B BIO-TECH-B has achieved significant counter-trend growth.

A key factor lies in its differentiated high-end vaccine product pipeline with technological advantages. As China's first and currently only approved quadrivalent influenza virus subunit vaccine, Huierkangxin® represents a major upgrade from traditional virus split vaccines, retaining only high-purity hemagglutinin (HA) and neuraminidase (NA) antigenic components, offering advantages of comprehensive protection, high antigenic component purity, and low adverse reaction risk.

Clinical trial results show that Huierkangxin® can induce strong immune responses, helping enhance immune effectiveness and better combat influenza viruses. Its serum protection rates against H1N1, H3N2, BV, and BY virus strains are 96.56%, 97.98%, 89.41%, and 95.88% respectively, all exceeding the EU standard of 70.0%. Its safety profile also outperformed the split vaccine control group.

Just three days after listing, AB&B BIO-TECH-B announced more positive commercialization news for this vaccine product. On August 13, the company announced that its quadrivalent influenza virus subunit vaccine passed preliminary review for this year's National Commercial Health Insurance Innovative Drug Directory, making it the only vaccine product on this list.

Additionally, the company's other core product—the investigational freeze-dried human rabies vaccine (human diploid cell)—has also attracted significant market attention. This vaccine uses human diploid cells for development, which WHO recommends as one of the safest cell culture substrates for viral vaccine production. Due to its potentially enhanced safety profile, this vaccine could serve as an excellent alternative to mainstream Vero cell rabies vaccines. The company completed Phase I clinical trials for this investigational product in October 2024 and plans to begin Phase III clinical trials in Q3 2025. As development of this vaccine type enters later stages, its commercialization certainty continues to increase, and it is expected to work alongside Huierkangxin® to continuously enhance company profits after future launch.

**Improving Integrated R&D, Production, and Sales to Strengthen Development Foundation**

Beyond building core product commercial scale, AB&B BIO-TECH-B has been committed to improving its integrated R&D, production, and sales closed loop, continuously strengthening its development foundation.

On the R&D front, AB&B BIO-TECH-B confirmed R&D investment of RMB 98.848 million in the first half of this year. Strong revenue growth and cash flow reserves provide robust support for the company's innovative R&D efforts. Under intensive R&D, the company is accelerating differentiated innovation, with its biopharma value gaining further validation.

Besides the two core products mentioned above, AB&B BIO-TECH-B's product pipeline includes 11 other investigational vaccines, such as trivalent influenza virus subunit vaccine, 23-valent pneumococcal polysaccharide vaccine, recombinant zoster vaccine (CHO cells), and respiratory syncytial virus (RSV) vaccine. These investigational vaccines cover multiple disease areas, forming a "tiered and orderly, breakthrough-focused, multi-product reserve" R&D landscape.

Notably, on August 15, the IND application for a Class 1 new drug "Recombinant Respiratory Syncytial Virus Vaccine (CHO cells) (Adjuvanted)" jointly submitted by AB&B BIO-TECH-B and its subsidiary was officially approved. This innovatively applies big data analysis to enhance druggability research, uses innovative technology with complete proprietary intellectual property rights, and employs pre-F antigen sequences with highly stable characteristics. Preclinical studies show positive performance across all indicators for this vaccine, not only stimulating high-titer neutralizing antibodies against both RSV A2 and B subtypes but also simultaneously activating high-level cellular immune responses.

This vaccine has also received clinical approval from the US FDA, becoming the company's first product to achieve dual China-US filing and simultaneous clinical approval. This not only demonstrates industry recognition of the company's R&D capabilities but also marks another milestone breakthrough in the company's blockbuster drug development.

Moreover, this vaccine has enormous commercialization potential. Its pre-F antigen structure offers excellent thermal stability, requiring no freeze-drying and enabling long-term liquid storage under 2-8°C refrigeration conditions. This optimizes formulation production processes, reduces production costs, and greatly enhances product accessibility and convenience, laying a solid foundation for subsequent commercial promotion and potentially bringing sustained growth momentum and considerable market returns to AB&B BIO-TECH-B.

To effectively ensure continued market volume growth and accelerate efficiency expansion for core products and subsequent products, AB&B BIO-TECH-B is actively advancing capacity construction. Currently, the company's first production park in Taizhou, Jiangsu covers over 48,000 square meters, equipped with three GMP-compliant production lines including influenza vaccine production lines, quadrivalent and trivalent influenza virus subunit vaccine and rabies vaccine production lines, plus one pneumococcal vaccine production line. The company's second influenza vaccine production line is expected to begin production by the end of 2026, providing sufficient capacity reserves.

Regarding commercial teams and market layout, leveraging its proprietary sales and marketing teams, Huierkangxin® has completed market access in 30 provinces nationwide and been selected by over 1,100 county-level CDC centers, achieving 100% product qualification and batch release approval rates. Simultaneously, the company's international expansion is progressing in parallel, efficiently utilizing capacity through the off-peak influenza seasons between South American and some Southeast Asian countries versus China. Last year, Huierkangxin® obtained registration certificates and marketing authorization in Macau, with Philippine registration procedures initiated. Over the next two years, the company plans to submit registration applications to multiple countries and regions including Thailand, Uruguay, Indonesia, and Canada, gradually forming a global sales network.

Beyond accelerating overseas market registration and product launches, AB&B BIO-TECH-B is also seeking strategic acquisition opportunities. In AB&B BIO-TECH-B's IPO fundraising plan, while 63.6% of funds primarily target global registration of core products, strategic acquisition redundancy is also reserved, with over 10% of funds available for horizontal integration. Although the company's stock price and market value gains have been impressive since listing, current valuations have not fully reflected acquisition expectations for Southeast Asian biologics capacity—especially under catalysis from Indonesia's vaccine localization policy (2024 requirement for foreign pharmaceutical companies to achieve 40% local capacity), acquiring regional CDMO enterprises could potentially shorten market development cycles by 3-5 years.

This year's first-half revenue surge of over 900% demonstrates that AB&B BIO-TECH-B's current innovative vaccine development and commercialization operating model is maturing. It is foreseeable that future integrated R&D, production, and sales competitive advantages will become a powerful driving force for continuously releasing AB&B BIO-TECH-B's intrinsic value, supported by gradually improving innovative R&D layouts and continuously expanding international commercialization capabilities.