Chinese drug start-ups poised for 2025 profits, in industry milestone

A pair of Hong Kong-listed mainland Chinese biotechnology firms are poised to turn a profit this year as their revenue from novel drugs finally outstrips costs related to research and development and marketing, according to analysts.

“Chinese biotechs have matured significantly and are creating value for Chinese patients and government payers,” said Tony Ren, head of Asia healthcare research at Macquarie Capital, in a report on July 16. “[Some will] likely turn profitable soon and no longer rely on investors for funding.”

Suzhou-based Innovent Biologics, the first Chinese company to be approved to sell a drug for weight loss and diabetes, is expected to swing to a first-half net profit of 260 million yuan (US$36.4 million) from a year-earlier loss of 392.6 million yuan, according to an estimate from Zhang Jialin, Nomura’s head of China healthcare research.

According to a consensus estimate from Bloomberg, the company was expected to post a net profit of 472 million yuan for 2025, its first full-year profit since going public. Innovent, founded in 2011, was one of the first batch of firms to go public in 2018 under a Hong Kong listing regime that allowed drug and medical device developers with no profit or revenue to sell shares.

Innovent Biologics is expected to post a first-half net profit of 260 million yuan compared with a loss of 392.6 million yuan a year earlier. Photo: Handout

In the second half, Zhang estimated that Innovent would book 1 billion yuan in sales from mazdutide, a glucagon-like peptide-1 (GLP-1) weight loss drug launched in July.

That would amount to a sixth of the company’s total expected revenue for this year, making it a key contributor to the improved bottom line. Novo Nordisk’s semaglutide, the first GLP-1 drug launched in China last year for weight loss, generated revenue of 770 million yuan in the first quarter.

South China Morning Post