Citi Research: Interest in China's healthcare innovation drug market significantly rebounding.

A Citigroup research report pointed out that since April 2025, the Chinese healthcare sector, particularly the innovative drug field, has seen a significant resurgence in market interest. Before the summer financial report season, the pharmaceutical outsourcing sector is expected to receive increased attention due to improvements in fundamentals, attractive valuations, and continued growth in order backlog. Citigroup has upgraded Taiji Pharmaceutical's A-share rating from "sell" to "buy", believing that the valuations of most leading companies are low, with a preference for WuXi AppTec and WuXi Biologics. Citigroup predicts that WuXi AppTec's 2025 fiscal year guidance will exceed expectations, with 2024 revenue reaching 39.24 billion RMB and an estimated growth of 10%-15% in 2025, reaching 41.5-43 billion RMB. WuXi Biologics saw a 13.1% increase in revenue in 2024, and first-half revenue in 2025 is expected to exceed expectations, backed by an order backlog of 1.85 billion USD to support its 2025 guidance. WuXi STA's rapid growth in undelivered orders may exceed expectations in the first half of the year. Citigroup emphasizes that leading companies in the CRO sector will continue to benefit from the growth in global drug development demand due to advances in technology platforms, global customer base, and cost advantages, especially in the field of antibody-drug conjugates and bispecific antibodies.