China Securities Journal Golden Bull｜Approximately Seventy Percent of Companies See Profit Improvement! SSE STAR Market Companies Following the Fifth Set of Listing Standards Accelerate Towards a Positive Cycle

The 2024 earnings preannouncements are being disclosed intensively. In accordance to the disclosed preannouncements, companies listed on the SSE STAR Market under its fifth set of listing standards have generally maintained a positive momentum in 2024—approximately 70% of them show profit improvement and a significant year-on-year reduction in total losses.

The fifth set of listing standards for SSE STAR Market has enhanced the inclusiveness for "hard & core technology" enterprises, supporting the listing of enterprises still in the R&D phase without generating a certain amount of operating revenue. Since the launch of the SSE STAR Market, a number of innovative drug development companies have adopted the fifth set of listing standards to go public. According to preliminary statistics from the market institutions, China has totally approved approximately 46 Class 1 new drugs for market entry in 2024, setting a new annual record high. Among these, companies listed on the SSE STAR market under the fifth setting of listing standards has obtained a total of 9 new drug product approvals in 2024, including 5 for Class 1 drugs.

According to China's drug registration classification, Class 1 new drugs refer to innovative drugs that have not been launched at home or abroad, carrying the attribute of being new all around the globe. Statistics data shows that since 2018, listed enterprises following the fifth set of listing standards on the SSE STAR Market have launched 20 Class 1 new drugs, accounting for about 12% of the total domestically approved innovative drugs during the same period.

The National Healthcare Security Administration recently announced at a press conference that the first edition of the Class C drug list is expected to be released within this year. Industry insiders believe that the rollout of the Class C Reimbursement List will  probably create new payment channels for innovative drugs by means of commercial health insurance. This means the current payment dilemma of innovative drugs is likely to be resolved with a new solution, further opening up new opportunities for industrial development.

Translated from China Securities Journal Golden Bull on January 21, 2025

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The above information is provided for reference purposes only and does not constitute investment advice.