Profitability turns positive, BD implementation—where is Rongchang Biotech's global expansion strategy currently?

Ask AI · How Rongchang Biotech balances cooperation and independent development amid the transformation of the innovative drug industry?

21st Century Business Herald Reporter Han Liming Intern Jiang Yutong

Benefiting from the commercialization and volume growth of core products, combined with revenue contributions from BD (business development) licensing, Rongchang Biotech (688331.SH; 09995.HK) delivered its best performance in nearly three years.

The 2025 annual report shows that during the period, the company achieved operating revenue of 3.25B yuan, an increase of 89.36% year-on-year; net profit attributable to shareholders turned profitable, reaching 710 million yuan.

As one of the few domestic biotech companies simultaneously focusing on R&D, manufacturing, and sales, Rongchang Biotech continued to disclose multiple major developments into 2026, including the approval and listing of the fourth indication for Vidicizumab, approval of a clinical trial for the bispecific antibody RC288 for advanced malignant solid tumors, and an exclusive licensing agreement with AbbVie for PD-1/VEGF bispecific antibody drugs.

In the secondary market, since 2026, Rongchang Biotech’s stock performance has been active. The A-share price rose from around 80 yuan per share at the beginning of the year to about 140 yuan, a 75% increase; the Hong Kong stock price rose from about 65 HKD to 110 HKD, roughly a 69% increase. As of the close on the evening of April 1, Rongchang Biotech’s A-share market capitalization was 81.29B yuan, and its Hong Kong market cap was 62.32B HKD.

Industry insiders believe that China’s innovative drug industry is shifting from scale expansion to value deepening, with the industry’s competitive logic moving from “speed” to “depth.” In this profound transformation, only companies with original innovation capabilities, autonomous commercialization systems, and a global perspective can truly navigate cycles and establish growth certainty.

Accelerated commercialization of core products

Looking back at the three years from 2022 to 2024, Rongchang Biotech continued to face operational pressures. During this period, revenue was 772 million yuan, 1.08B yuan, and 1.72B yuan, with year-on-year growth rates of -45.87%, 40.26%, and 58.54%, respectively; net profit attributable to shareholders remained in loss, with losses of 999 million yuan, 1.51B yuan, and 1.47B yuan. By the end of 2024, the company’s cash and cash equivalents stood at 762 million yuan, and its debt ratio increased to 63.88%, indicating significant funding pressure.

However, according to Rongchang Biotech’s disclosed 2025 annual report, the company’s operational situation improved. As of the end of 2025, the company’s cash on hand was approximately 1.2B yuan, and its debt ratio decreased to 50.21%.

In terms of commercialization, the financial report shows that Rongchang Biotech achieved annual sales revenue of 2.26M yuan from biopharmaceuticals, a 35.80% increase, accounting for 70.97% of total revenue, with a gross margin of 83.41%, up 2.79 percentage points from the previous year.

Image source: Screenshot of Rongchang Biotech’s 2025 annual report

Currently, Rongchang Biotech has two commercialized products: TAI® (Taltirelin) and AidiXi® (Vidicizumab). In 2025, Taltirelin sales reached 2.255 million doses, up 47.92%; Vidicizumab sales were 301.9k doses, up 27.31%.

For these two drugs already in the commercialization stage, Rongchang Biotech is actively expanding their indications. In January 2026, Rongchang Biotech announced that Vidicizumab was officially included in the breakthrough therapy drug list by the China National Medical Products Administration (NMPA) Center for Drug Evaluation (CDE), for indications including injection of Vidicizumab combined with Trastuzumab and Pertuzumab as first-line treatment for HER2-high expression advanced gastric/gastroesophageal junction adenocarcinoma.

In February, a new indication for Vidicizumab was approved by the NMPA for treating adult breast cancer patients with HER2-low expression (IHC 1+ or IHC 2+/ISH-) with liver metastasis, who had previously received at least one systemic therapy for metastatic disease or relapsed within 12 months after adjuvant chemotherapy.

Industry insiders told the 21st Century Business Herald that as the indications for innovative drugs continue to expand, the commercial space for these products may further open up. Rongchang Biotech’s efforts to improve its commercialization team and hospital access layout are expected to sustain the growth potential of its core products.

Rongchang Biotech also mentioned in its annual report that developing innovative biologics from early drug discovery to clinical trials often takes 10 to 15 years and requires hundreds of millions to over a billion dollars in R&D investment. For successfully marketed biologics, building large-scale commercial manufacturing facilities can cost between $200 million and $700 million. Therefore, companies that entered the biotech industry early and have advanced some products into late-stage clinical or commercialization phases tend to have higher capital barriers compared to later entrants.

Continued BD transactions

While core product commercialization continues to boost company performance, revenue from BD licensing deals has also become an important growth driver.

In June 2025, Rongchang Biotech announced the paid licensing of Taltirelin to Vor Biopharma Inc., a Nasdaq-listed US company. Vor Bio will obtain exclusive rights to develop, produce, and commercialize Taltirelin globally (excluding Greater China).

According to the agreement, Rongchang Biotech will receive $125 million in cash and warrants from Vor Bio (including a $45 million upfront payment and warrants worth $80 million, allowing purchase of 320 million Vor Bio common shares at $0.0001 per share, about 23% of Vor Bio’s expanded total share capital), as well as milestone payments up to $301.9k, totaling $4.23 billion. Additionally, Rongchang Biotech will earn high single-digit to double-digit royalties based on sales.

In August of the same year, Rongchang Biotech announced an agreement with Santen Pharmaceutical Co., Ltd., a wholly owned subsidiary of Santen Pharmaceutical (China) Co., Ltd., granting Santen China exclusive rights to develop, produce, and commercialize RC28-E in Greater China, Korea, Thailand, Vietnam, Singapore, the Philippines, Indonesia, and Malaysia. Rongchang Biotech retains global rights outside these regions.

Entering 2026, Rongchang Biotech signed an exclusive licensing agreement with AbbVie for the PD-1/VEGF bispecific antibody RC148. Under the deal, AbbVie will have exclusive rights to develop, produce, and commercialize RC148 outside Greater China. Rongchang Biotech will receive an upfront payment of $650 million and is eligible for milestone payments up to $4.95 billion, as well as tiered double-digit royalties on net sales outside Greater China.

Industry insiders also pointed out that in 2025, the collaboration between Sanofi and Pfizer on PD-1/VEGF products set a new record for upfront payments for domestic innovative drug exports. The market enthusiasm for PD-1 (L1)/VEGF bispecific antibodies continues to rise; coupled with increasing recognition of Chinese innovative drugs by multinational companies, China’s innovative drug export has entered a new stage. However, beyond upfront payments, the key factors are the ability to realize milestone payments and sustain long-term sales sharing.

In fact, as BD transactions in China’s biopharmaceutical sector increase, there are concerns that in current collaborations, domestic companies mainly undertake drug R&D and commercialization within China, while rights in other global markets largely belong to multinational pharmaceutical companies. This model may limit the long-term development space for domestic firms. How Rongchang Biotech will balance BD licensing cooperation with its own global expansion and continuously enhance core competitiveness remains to be seen.