2025 Pharmaceutical and Biotech IPO Performance Outlook: CXO Industry Sentiment Improves, Innovative Drug Companies' "De-SPAC" Journey Remains Challenging, Ultimate Cost Reduction and Efficiency Gains Competition

Source | Times Business Research Institute

Author | Lu Shuyi

Editor | Zheng Lin

In 2025, the A-share pharmaceutical and biotech industry faces new changes, with IPO enthusiasm rebounding.

Wind data shows that in 2025, a total of 10 new stocks in the A-share pharmaceutical and biotech (Shenwan Level 1, the same below) industry debuted, doubling the number compared to 2024.

However, Times Business Research Institute notes that as of the end of February 2026, among the 10 pharmaceutical and biotech companies listed in 2025, 8 have released performance briefings or forecasts. Their performance shows a “polarized” pattern, possibly driven by the resonance of industry cycles, policies, and business models.

From the perspective of sub-sectors, CXO (contract research organization) and upstream industry chains are experiencing a “reversal of prosperity,” and the pharmaceutical distribution model is quietly transforming. Meanwhile, innovative drug companies face a rugged path to “go public U.” Additionally, despite increasing industry segmentation, “cost reduction and efficiency enhancement” has become a key survival rule. Companies that can balance R&D investment with operating expenses and optimize supply chain efficiency are better positioned to maintain profit margins amid industry fluctuations.

Number of new stocks doubles year-on-year, with performance showing a “polarized” pattern

In the 2026 National Two Sessions government work report, biopharmaceuticals are explicitly listed as a “new pillar industry” at the national level, alongside integrated circuits, aerospace, and low-altitude economy, laying a top-level strategic foundation for the industry’s long-term development.

In 2025, while many pharmaceutical biotech companies chose to “float in Hong Kong,” the IPO enthusiasm in the A-share pharmaceutical and biotech industry also rebounded.

Wind data shows that in 2025, 10 pharmaceutical and biotech companies successfully listed in A-shares, doubling the 5 in 2024. Under the new “National Nine Regulations” with strict supervision, how are the new stocks in the pharmaceutical biotech industry performing in 2025?

Wind data indicates that as of February this year, among the 10 A-share pharmaceutical and biotech companies listed in 2025, except for Weigao Blood Purification (603014.SH) and Chaoyan Co., Ltd. (301602.SZ), the remaining 8 have released performance briefings or forecasts. Of these, 5 companies reported both revenue and net profit growth, with only 1 showing a performance “turnaround.”

Specifically, Baio Saitu (688796.SH) saw explosive growth in net profit attributable to shareholders, with a 416.37% increase, earning it the title of “performance king” among new stocks in the industry.

Performance briefings show that in 2025, Baio Saitu’s revenue and net profit attributable to shareholders were 1.379 billion yuan and 173 million yuan, respectively, with year-on-year growth of 40.63% and 416.37%. The briefing attributes this performance to two main drivers: continuous expansion in overseas markets and recovery of the domestic biopharmaceutical industry. As a representative in the outsourced medical R&D field, Baio Saitu leverages high technical barriers (such as RenMice full-human antibody/TCR mouse platform) to improve both profitability and operational efficiency.

Other companies with notable performance include SaiFen Technology (688758.SH) and Jianxin Superconducting (688805.SH). Their performance briefings show that in 2025, their net profits attributable to shareholders increased by 48.42% and 34.65%, respectively. SaiFen, as a raw material drug company, mainly benefits from the growing demand for domestically produced purification media in downstream biopharmaceutical R&D and manufacturing. Jianxin, as a medical device company, benefits from increased revenue from liquid helium-free superconducting products and the gradual release of domestic medical equipment procurement demand, reflecting the positive impact of new medical infrastructure and equipment upgrade policies on the high-end medical device industry chain.

However, not all biotech companies have enjoyed the industry recovery. In stark contrast to leading CXO and high-end medical device sectors, some innovative drug companies remain deep in losses.

Performance briefings show that in 2025, HeYuan Bio-U (688765.SH), despite revenue growth of 89.80% driven by new product Aofumin, saw its net profit attributable to shareholders decline from -151 million yuan last year to -158 million yuan. This is mainly because its production line is still in capacity ramp-up, coupled with sustained high R&D investment. Even with successful product listing, moving from approval to large-scale sales and covering early R&D costs remains a lengthy process.

Losses also widened for BiBait-U (688759.SH). The performance briefing indicates that in 2025, the company still had no revenue, with net profit attributable to shareholders decreasing from -56 million yuan last year to -153 million yuan. Besides maintaining high R&D investment, the company’s government subsidy income decreased by about 80 million yuan compared to 2024, leading to increased losses.

Unlike the still-investing “-U” companies, Hanbang Technology (688755.SH) experienced a “performance turnaround” in its first year of listing. Wind data shows that from 2022 to 2024, Hanbang’s net profit grew rapidly, but the 2025 performance briefing indicates that revenue increased by only 6.40% year-on-year, while net profit attributable to shareholders fell by 24.89%. The increase in revenue without profit growth is mainly due to intensified market competition, fluctuations in downstream demand, and a decline in high-margin overseas income, which eroded profitability.

Sub-sector prosperity differentiation and the ability to go global have become critical dividing lines

Why do some companies in the same pharmaceutical and biotech sector show “polarized” performance?

The primary reason lies in industry cycles and sub-sector prosperity differences. In the pharmaceutical and biotech supply chain—from service providers to manufacturing and to innovative drugs—the prosperity level declines stepwise.

Leading companies like Baio Saitu and those with differentiated technological platforms are more likely to secure overseas orders or collaborations with major pharmaceutical companies. Coupled with the recovery of the domestic biopharmaceutical industry, their prosperity remains high. Conversely, high-end medical device companies like Jianxin Superconducting, supported by accelerated localization and new medical infrastructure policies, are expected to continue volume growth. In contrast, innovative drug companies like HeYuan and BiBait, due to long commercialization cycles and large R&D investments, still face relatively low prosperity.

Additionally, some equipment and consumables suppliers relying on domestic homogeneous competition face price wars and declining gross margins.

Policy influence also plays a significant role. The pharmaceutical industry is highly affected by policies, and uneven policy support across fields leads to unbalanced development. High-end medical devices benefit from localization policies and public hospital reforms, showing better performance; while traditional chemical preparations and medical devices face pressures from volume-based procurement and price regulation.

Beyond external factors like industry cycles and policies, the main reason for performance divergence among listed companies is their R&D investment and commercialization capabilities.

For example, Baio Saitu leverages high-barrier technologies to create competitive advantages, converting R&D investment into actual revenue. Companies like SaiFen and Jianxin, which have achieved stable profitability, are in stages of product commercialization and continuous volume expansion. Conversely, “-U” companies are still in R&D phases; if clinical trials or approvals encounter obstacles or R&D pacing changes, their net profits can fluctuate significantly. For instance, BiBait, with multiple products in development but not yet commercialized, remains in continuous loss.

In the context of globalization, the ability to expand products overseas is another critical performance differentiator.

Baio Saitu, for example, has achieved significant overseas market expansion, becoming an important source of revenue in 2025. In contrast, companies facing obstacles in going abroad or mainly serving the domestic market, like Hanbang Technology, see increased competition and declining high-margin overseas income, directly impacting profitability.

The pharmaceutical distribution model is quietly transforming, with “cost reduction and efficiency enhancement” becoming a vital survival rule

Behind the numbers of the first annual reports of 8 newly listed biotech stocks, industry trends are evident: CXO rebound and transformation of distribution channels.

With overseas orders and domestic demand both recovering, CXO and upstream industry chains are experiencing a “prosperity reversal.”

The performance rebound of CXO and upstream companies like Baio Saitu and SaiFen indicates that the outsourced medical R&D industry is approaching a cycle inflection point, with industry ecology showing signs of recovery. This is mainly due to the resonance of overseas order return and domestic demand revival. However, this warm trend currently benefits mainly those with technological barriers; mid-to-low-end service providers facing severe homogeneous competition have yet to feel the benefits.

Furthermore, the pharmaceutical distribution model is quietly changing, with SPD (integrated operation of medical consumables) and other high-value-added services emerging as new growth drivers.

As a representative in pharmaceutical distribution, Jianfazhixin (301584.SZ) forecasts a net profit increase of 6% to 29.65% in 2025. The company states that its SPD business maintained rapid growth, with high gross margins, further boosting overall profitability.

In the context of declining gross margins in traditional pharmaceutical distribution, SPD models provide integrated services such as consumables procurement, inventory management, and distribution, helping to enhance customer stickiness and profitability. Jianfazhixin’s growth indicates that competition in the pharmaceutical distribution industry has shifted from network coverage to supply chain comprehensive service capabilities.

As China’s medical insurance payment system reform deepens, hospitals’ demand for fine management of consumables is surging, and the penetration rate of SPD services is rapidly increasing. Pharmaceutical distribution companies that can quickly transform from logistics providers to supply chain solution providers are expected to capture more market share.

It is important to note that although some sub-sectors’ prosperity has improved, “cost reduction and efficiency enhancement” remains a universal survival rule for biotech companies.

Baio Saitu explicitly mentions “lean management measures further promote operational efficiency” in its announcement, indicating that even amid industry recovery, the company continues to control costs. Additionally, Jianfazhixin attributes part of its net profit growth to financial structure optimization and reduced financing costs, reflecting cost reduction at the financial level.

It is evident that the pharmaceutical industry has entered an era of refined management and cost control. Companies capable of balancing R&D investment with operating expenses and optimizing supply chain efficiency are better positioned to maintain profit margins during industry cycles.

(Full text: 3036 words)