in the coming September, weight loss drug concept stocks have become one of the hottest sectors in the-share market.

according to the times weekly reporter statistics, as of September 28, Changshan pharmaceutical (300255.SZ) rose as much as 194.06 percent in the month, and borui pharmaceutical (688166.SH) and hanyu pharmaceutical (300199.SZ) also rose more than 40% this month. Among the 20 weight-loss drug concept stocks in A shares, only Aimeike (300896.SZ) fell by 10% in a month, while the rest of the concept stocks showed an upward trend.

In addition, Wind data shows that the total market value of the 20 weight-loss drug concept stocks increased from 379.995 billion yuan at the close of August 31 to 414.983 billion yuan at the close of September 28, and the market value of the sector rose by nearly 35 billion yuan.

However, in a trading day in the-share month on September 28, a number of diet drug concept stocks appeared to diverge. Changshan Pharmaceuticals rose more than 18 per cent in intraday trading, then fell 2.9 per cent to close at 13.38 yuan per share. Hanyu Pharmaceuticals, Dezhan Health (000813.SZ) led the decline, while Zhongsheng Pharmaceuticals (002317.SZ) and Shuangyu Pharmaceuticals (002038.SZ) rose more than 5%.

throughout September, Changshan pharmaceutical was the most demon diet drug concept stock, and its stock price soared like a rocket.

From the opening price of 4.47 yuan/share on September 11, Changshan Pharmaceutical once rose to an all-time high of 16.37 yuan/share, and then the stock price fell slightly. Although the listed company has repeatedly announced that the clinical trial of albenatide injection developed by the company is only aimed at type 2 diabetes, no clinical trials for obesity or weight loss have been carried out, and the enthusiasm of funds has not been suppressed.

Ebenatide is a long-acting glucagon-like peptide -1 receptor agonist (GLP-1RA). It is a class 1 innovative drug developed and registered by Changshan Kaijiejian, a subsidiary of a listed company. It is used to treat type 2 diabetes and is injected once a week. Prior to this, Changshan Pharmaceutical announced on September 18 that the company had received a summary report on the phase III clinical study of Ebenatide.

In fact, the pharmaceutical stocks as a whole have a strong trend recently, so why is it that the previously relatively unpopular weight-loss drug sector in the pharmaceutical sector is the first to change? Who on earth is speculating on the weight-loss drug concept stocks?

On September 27, Liu Feng (pseudonym), a senior investor in the pharmaceutical industry, told Times Weekly that there are many factors in the activity of this round of weight-loss drug concept stocks. "In the international market, glucagon-like peptide -1(GLP-1) The two giants of the track have reached record highs in market value, and the Fed's interest rate hike is about to end, which has an impact on A shares. In addition, in recent years, the pharmaceutical sector has begun to stabilize and rebound under the influence of policies, the environment for innovative drugs has improved, and domestic GLP-1 products have gradually entered the listing stage, with funds to copy the bottom layout in advance."

public offering, hot money pursuit GLP-1

From the perspective of the market, the popularity of the concept of weight-loss drugs comes from the application and sales breakthrough of GLP-1 drugs-a new type of weight-loss drugs. The two major international pharmaceutical companies Novo Nordisk (NVO.NYSE) and Lilly (LLY.NYSE) all delivered semi-annual results that exceeded market expectations. By the end of June 2023, Novo Nordisk's revenue had increased 29% to 107.7 billion Danish kroner (about 113.9 billion yuan), while sales revenue in diabetes and obesity treatment had increased 36% to 99 billion Danish kroner (about 103 billion yuan).

Based on this, since August 2023, both U.S. stocks and A- shares have been hyped on GLP-1 themes, which has also prompted the market value of the two major pharmaceutical companies to hit new highs, and Novo Nordisk has become the most valuable in Europe. Listed companies.

A number of investment institutions have also raised their sales expectations for GLP-1 drugs. JPMorgan Chase, an international investment bank, has raised its sales forecast for weight-loss drugs, predicting that annual sales of GLP-1 drugs will exceed $100 billion by 2030.

In China, weight-loss drugs not only have a huge market, but also have a complete industrial chain. Soochow Securities Research Report believes that polypeptide weight-loss drugs have outstanding curative effects and large market demand, and are expected to become the future growth point of the industry. At the same time, the domestic polypeptide industry chain is complete, with a global competitive advantage.

Subsequently, optimism about the concept of weight-loss drugs was transmitted to the country, from public funds to brokerage institutions to hot money, one after another layout, one after another, pushing up the stock market value of the concept of weight-loss drugs.

According to the 2023 semi-annual report of Changshan Pharmaceutical, as of the end of June 2023, among the top ten tradable shareholders, JPMorgan Chase Bank, Guangfa Core Competitiveness Hybrid Securities Investment Fund, and Xuanyuanke New No. 122 Private Equity Investment Fund are all new shareholders, ranking sixth, ninth and tenth respectively.

Among them, the GF Core Competitiveness Hybrid Securities Investment Fund is managed by Wang Ruidong, a senior fund manager of GF Fund. The product was established in May 2023 with an asset management scale of 0.435 billion yuan. According to Wind statistics, as of the end of June 2023, a total of 5 public funds under a total of 10 products holding Changshan Pharmaceuticals, holding a total of 6.6744 million shares.

In addition, star fund managers have also appeared in many stocks with large gains in this round.

as of the end of June 2023, in the list of the top ten circulating shareholders of saint biology (688117.SH), China Europe medical innovation and China Europe medical health managed by Glen are the new major shareholders, ranking second and third, with 3.2618 million shares and 1.9189 million shares respectively. There are Wang Zhengjiao management of the southern medical and health care flexible configuration, Wan Minyuan management of the new growth, are the new top ten shareholders, respectively, ranked eighth and tenth. As of the close of September 28, San Nuo Bio rose 10.91 percent this month.

In addition to the public offering funds with latent layout in advance, the relay speculation of hot money is also a key factor in the rise of the stock price of diet drug concept stocks.

Data from the Dragon and Tiger List show that in the past month, "Lhasa Tiantuan" has frequently appeared in the list of Changshan Pharmaceutical, occupying a total of four seats, with a total transaction amount of 0.311 billion yuan.

According to the Shenzhen Stock Exchange, Changshan Pharmaceutical rose 108.33 percent from September 11 to 22. During the period of serious abnormal growth, natural persons bought 8.421 billion yuan, accounting for 85.38 percent. Among them, small and medium-sized investors bought 5.752 billion yuan, accounting for 58.31 percent. Institutional investors bought 1.341 billion yuan, accounting for 13.6 percent.

GLP-1 track will welcome the tide of product listing

Capital market expectations are high, but the "R & D war" on the GLP-1 track of pharmaceutical companies has just begun.

Changshan Pharmaceutical's 2023 semi-annual report shows that the company mainly focuses on R & D, production and sales of drugs for the treatment of cardiovascular and cerebrovascular diseases, and has a complete heparin product industry chain. In the first half of 2023, the company's revenue was 0.82 billion yuan, down 28.45 from the same period last year, and the net profit attributable to the parent company turned to a loss of -0.156 billion yuan, compared with 64.7611 million yuan in the same period in 2022. In response, the company said it was mainly due to the decline in sales of heparin raw materials and the decline in the unit price of low molecular weight heparin preparations.

In addition to heparin products, the innovative drug business is highly expected by Changshan Pharmaceutical. As of the end of June 2023, the company's monetary capital was 0.555 billion billion yuan, a decrease of 3.81 percentage points year-on-year. In response, the company explained that it was mainly due to the payment of Phase III clinical trial fees, various research and development expenses and the purchase and construction of long-term assets.

Changshan Pharmaceutical said that the company continues to promote the phase III clinical trial of elbenatide and expects to apply to CDE (National Drug Evaluation Center) before the end of this year.

This also means that Ebenatide is not currently generating a profit. Changshan Pharmaceutical also stated in the announcement of abnormal fluctuations in stock trading that there are currently many types of drugs for the treatment of type 2 diabetes, and GLP1 drugs are one of them. GLP1 drugs have been approved for listing in China, and some GLP1 drugs have been included in the national medical insurance. Catalogue, and there are still many GLP1 drugs in the clinical trial stage. Even if Ebenatide is listed in the future, it will face higher market competition risks and greater uncertainty in profitability.

This is also the current dilemma encountered by most diet drug concept stocks. A large number of GLP-1 drugs are still in the research and development stage and cannot bring performance to the company in the short term. At present, among the GLP-1 drugs for weight loss indications, only East China Medicine (000963.SZ) liraglutide injection and Renhui Bio's benaglutide injection have been approved for listing.

Aurete (605116.SH) replied to investors on September 27 that the company's simaglutide API production line was still under construction.

Dezhan Health said in an interview with the media that the company is carrying out a research project on indications such as lowering blood sugar and weight loss, and related products are not expected to be available until 2026.

Borui Pharmaceutical said in a survey of investors such as China Southern Fund and Nomura Oriental Securities on September 22 that it will focus on the layout of multi-target drugs containing GLP-1 and explore new drug delivery methods in addition to traditional injection methods. The company is optimistic about the GLP-1 drug market space, single-target participants more, so will focus on the layout of multi-target drugs.

According to the statistics of Soochow Securities, there are more than 30 kinds of drugs GLP-1 relevant targets in the clinical stage in China, and the varieties are gradually increasing, and the competition is gradually in the Red Sea. "The weight loss effect of GLP-1 products is obvious, and it is about to usher in the market tide. The follow-up products include injection/oral administration of simaglutide, tilpotide and Cinda's mastide and other products are expected to be approved for weight loss indications in 2024-2026." Dong Wu Securities said in a research report.