Bank of America Securities: The CXO industry in China benefits from strong biotech financing, raising target prices for WuXi AppTec (02359) and others.

10:20 13/08/2026

Benefiting from the strong financing performance in the global and Chinese biotechnology primary markets in the first half of the year, along with the continued active licensing transactions for innovative drugs, it is expected that research and development activities will further accelerate, and Chinese CRO/CDMO companies are likely to benefit.

Bank of America Securities released a research report stating that, benefiting from the strong performance of the global and Chinese biotechnology primary markets in the first half of the year, coupled with the continued activity in innovative drug licensing transactions, research and development activities are expected to accelerate further, which could benefit Chinese CRO/CDMO companies. The firm has raised its industry terminal growth rate assumption from 1% to 3% and has increased the target prices for several CXO companies. Bank of America pointed out that, according to Pharmcube data, there were 814 healthcare financing events in China's primary market in the first half of 2026, a year-on-year increase of 13.8%, with a total financing amount of 72.6 billion RMB, a year-on-year increase of 41.7%; among these, innovative drug financing reached 41.8 billion RMB, a year-on-year increase of 79.1%. In terms of global innovative drug financing, there were 505 financing events in the first half of the year, a year-on-year increase of 6.1%, with a total financing amount of 26.8 billion USD, a year-on-year increase of 58.5%. Regarding external licensing transactions, China had 210 related transactions, with total upfront payments of 5.4 billion USD and total transaction value of 105.1 billion USD, a year-on-year increase of 73%. The firm raised the target price for WuXi AppTec (02359) H shares from 204.3 HKD to 242 HKD, and for WuXi AppTec A shares (603259.SH) from 177.8 RMB to 210.5 RMB, maintaining a "Buy" rating due to its clear growth visibility. The firm also raised WuXi AppTec's revenue estimates for 2029 to 2035 by 3% to 7%, and adjusted net profit forecasts by the same margin. Pharmaron Beijing (03759) H share target price was raised from 27 HKD to 32.3 HKD, and for Pharmaron Beijing (300759.SZ) A shares from 23.8 RMB to 28.4 RMB, with the H shares maintaining a "Buy" and the A shares maintaining an "Underperform" rating due to relatively high A share valuations. WUXI BIO (02269) target price was raised from 39.5 HKD to 47.3 HKD, maintaining a "Neutral" rating, balancing its strong execution capabilities with relatively less attractive valuations compared to industry peers.

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