Chinese biotech companies Innovent, BeOne, and Akeso have earned billions of yuan from licensing drug candidates to multinational partners for overseas development.
A pair of mainland Chinese biotechnology companies listed in Hong Kong is expected to make a profit this year, as their income from new pharmaceuticals finally surpasses their research and development (R&D) and marketing expenses.
In a report released on July 16, Tony Ren, head of Asia healthcare research at Macquarie Capital, stated that Chinese biotech companies have reached a substantial level of maturity and are creating value for Chinese patients and government payers. Some will probably become profitable and stop relying on investors for capital.
Zhang Jialin, head of China healthcare research at Nomura, estimates that Suzhou-based Innovent Biologics, the first Chinese healthcare company to be approved to sell medicine for weight loss and diabetes, will bring a profit of 260 million yuan (US$36.4 million) in the first half after a loss of 392.6 million yuan the previous year.
Analysts predict that the company will report a net profit of 472 million yuan for 2025, its first full-year profit since going public in 2025. Innovent was founded in 2011. It was one of the first batches of companies to list in an initial public offering in 2017 under a Hong Kong listing policy that allowed drug and medical device developers with no income or profit to sell shares.
Zhang estimated that Innovent would reach 1 billion yuan sales in the second half from mazdutide, a glucagon-like peptide-1 (GLP-1) weight loss medication introduced in July.
That would be a significant factor helping the company to improve, as it represents a sixth of its total expected income for the year. Novo Nordisk founded Semaglutide, the first GLP-1 drug for weight loss, in China last year. It brought in 770 million during the first quarter.
Analysts predicted that BeOne, a developer of oncology drugs founded in 2010, would report a net profit of US$42 million for the first half and a full-year profit of US$109.5 million. The company will reveal its first-half income on August 6.
Zhang added that the company’s profits increased due to the sales of its blood cancer medication, zanubrutinib, in the United States (US) and Europe.
Over the past few years, Chinese biotech companies Innovent, BeOne, and Akeso have earned billions of yuan in upfront cash from licensing drug candidates to multinational partners for overseas development.
However, despite an increase in deals in recent years, Ren of Macquarie noted that milestone payments in the drug development process were challenging to predict because partnerships were often terminated due to changing competitive factors and legal barriers.
For example, in March 2022, the United States Food and Drug Administration denied an application from Eli Lilly to sell Innovent’s lead oncology drug, sintilimab. It was used to treat the most common type of lung disease in the United States, but it was approved in China a year earlier. The FDA recommended a second multi-regional clinical trial be carried out, but the drug has still not been approved.
In mid-2019, Celgene offered BeOne the exclusive right to develop and market tislelizumab, the Chinese company’s immunotherapy drug candidate, before being acquired by Bristol-Myers Squibb. The American pharmaceutical company already has an approved medicine in the same category. Celgene paid BeOne US$150 million to end the deal.
In 2021, BeOne relicensed the rights for the same medication to Switzerland’s Novartis; however, in 2023 gave back the rights, citing a shift in the market. After that, BeOne took over to develop the drug and won permission to launch it in the US and the EU.
According to Ren, most of the licensing deals, including ones from China, are small in terms of payments and have little impact on licensers’ medium- to long-term financial performance.