STAR Market Pharma 2024 Report Card: Profit Growth for 53%, R&D Spend Hits ¥350M Average

Let’s dive into the latest performance metrics from China’s STAR Market (Shanghai Stock Exchange Science and Technology Innovation Board 科创板), a serious hotspot for the biopharma game.

The 2024 annual reports are all in, and the numbers give us a fascinating look inside 115 listed biopharmaceutical companies.

The big picture? It’s a mixed bag, but with some serious bright spots.

Over half of these firms saw their net profits climb year-over-year.

But it’s not all smooth sailing – R&D spending saw some shake-ups, and talent shifts are reshaping the landscape.

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Profitability Check: Who’s Winning, Who’s Struggling?

First up, the bottom line.

Data crunched from Wind shows that 61 out of the 115 companies (that’s about 53%) reported higher net profits in 2024 compared to the previous year.

That’s a pretty solid sign of resilience and growth in the sector.

The Breakout Stars: Massive Growth & Shedding the ‘U’

Some companies didn’t just grow; they exploded.

• MicroPort EP (Weidian Shengli 微电生理) (688351): Absolutely crushed it with a net profit surge of over 800% YoY. Seriously, 815.36% to be exact.
• Revenue hit ¥413 million RMB (approx. $57.4M USD), up 25.51%.
• Net profit reached ~¥52.07 million RMB (approx. $7.23M USD).
• Crucially, their non-recurring profit/loss adjusted net profit turned positive (~¥5.08M RMB / $705.6K USD), meaning they ditched the “U” tag (which marks unprofitable companies). Huge milestone.

Joining MicroPort EP in the “no longer unprofitable” club:

• SinoCellTech (Shenzhou Xibao 神州细胞) (688520)
• BioRay Pharmaceutical (Baili Tianheng 百利天恒) (688506)

Getting rid of that “U” is a big deal.

As angel investor and AI expert Guo Tao (郭涛) put it, “When unprofitable companies listed on the STAR Market turn profitable, it’s a positive signal indicating these enterprises are gradually maturing and stabilizing.”

He added it shows “significant progress in business model, technological R&D, or market expansion,” boosting investor confidence and making it easier to raise capital.

Other notable mentions for doubling net profits include:

• Notta & Belle (Nuotai Shengwu 诺泰生物) (688076)
• Sunshine Guojian Pharmaceutical (Sansheng Guojian 三生国健) (688336)

The Other Side of the Coin: Steep Declines

It wasn’t sunshine for everyone.

Nansin Pharm (Nanxin Zhiyao 南新制药) (688189) faced the toughest year, with net profit plummeting by a staggering 3183.79% YoY.

• Operating revenue dropped 63.44% to ~¥263 million RMB (approx. $36.5M USD).
• Net loss hit ~¥-357 million RMB (approx. $-49.6M USD).

Nansin Pharm chalked this up to industry policy shifts, fierce market competition forcing price cuts on core products, fewer flu cases (impacting demand), and necessary accounting provisions for potential losses.

R&D Deep Dive: Big Spenders & Big Cutters

Research and development (R&D) is the lifeblood of pharma innovation, especially on the tech-focused STAR Market.

The average R&D spend across these 115 companies actually ticked up slightly in 2024.

• 2024 Average R&D Spend: ¥353 million RMB (approx. $49.0M USD)
• 2023 Average R&D Spend: ¥343 million RMB (approx. $47.6M USD)

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BeiGene Leads the Pack (By a Mile)

BeiGene (Baiji Shenzhou 百济神州) (688235 / 06160.HK / BGNE.O) continues its reign as the undisputed R&D spending champion.

• 2024 R&D Expenses: ¥14.14 billion RMB (approx. $1.96 billion USD!)
• This represents a 10.35% increase YoY.

BeiGene says this cash fuels their preclinical research, clinical trials, collaborations, and expanding global R&D team. Growth drivers included upfront licensing/milestone payments and internal investments.

Other big R&D players (spending over ¥1 billion RMB):

• United Imaging Healthcare (Lianying Yiliao 联影医疗) (688271)
• RemeGen (Rongchang Shengwu 荣昌生物) (688331 / 09995.HK)
• BioRay Pharmaceutical (Baili Tianheng 百利天恒) (688506)
• Junshi Biosciences (Junshi Shengwu 君实生物) (688180 / 01877.HK)

On the growth front, Jiangsu Jindiaok Biotechnology (Jindike 金迪克) (688670) saw the biggest YoY jump in R&D spending, up 117.23%.

Also notable for R&D spending growth:

• BioRay Pharmaceutical (Baili Tianheng 百利天恒) (688506)
• InTec PRODUCTS, INC. (Yingnuote 英诺特) (688253)
• Notta & Belle (Nuotai Shengwu 诺泰生物) (688076)

R&D Spending Gets Slashed

However, some companies significantly tightened their R&D belts.

Kexing Biopharm (Kexing Zhiyao 科兴制药) (688136) made the deepest cut.

• 2024 R&D Expenses: ~¥168 million RMB (approx. $23.3M USD)
• 2023 R&D Expenses: ~¥345 million RMB (approx. $47.9M USD)
• That’s a 51.26% decrease YoY.

Kexing explained this was due to lower clinical and trial production costs and effective cost control measures, including adopting tech like CADD, AI, and better energy management to optimize marketing, R&D, and production expenses.

Others with notable R&D spending drops:

• EndoPuls Therapeutics (Xinmai Yiliao 心脉医疗) (688016)
• Tinavi Medical Technologies (Tianzhihang 天智航) (688277)

Financial commentator Zhang Xuefeng (张雪峰) advises caution: “A decrease in R&D expenses needs to be analyzed in the context of the company’s specific situation.”

He suggests it might be understandable if products are mature, but “if breakthroughs are still needed… reducing R&D expenses prematurely could impact its long-term competitiveness.”

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Talent Trends: Headcounts Rise and Fall

People are the engine of R&D progress.

BeiGene (Baiji Shenzhou 百济神州) isn’t just spending big; they’re also employing big.

• R&D Staff Count (End of 2024): 3,905 people (largest on STAR Market)
• Proportion of R&D Staff: 35.3% of total employees
• Average R&D Staff Salary: A hefty ¥956,000 RMB (approx. $132,800 USD)

Other companies with large R&D teams (over 1,000):

• United Imaging Healthcare (Lianying Yiliao 联影医疗): 3,271 R&D staff
• Medicilon (Meidixi 美迪西) (688202)
• Sunny Pharmatech (Yangguang Nuohe 阳光诺和) (688621)
• BioRay Pharmaceutical (Baili Tianheng 百利天恒)

Companies adding significant R&D headcount (over 100+ each) in 2024 include:

• BioRay Pharmaceutical (Baili Tianheng 百利天恒)
• United Imaging Healthcare (Lianying Yiliao 联影医疗)
• Xiangyu Medical (Xiangyu Yiliao 翔宇医疗) (688626)
• BeiGene (Baiji Shenzhou 百济神州)

R&D Team Downsizing: RemeGen & Zhixiang Bio

On the flip side, some firms saw significant reductions in their R&D workforce.

RemeGen (Rongchang Shengwu 荣昌生物) reported the largest absolute drop.

• End of 2024 R&D Staff: 926
• End of 2023 R&D Staff: 1,308
• Decrease: 382 people (-29.2% YoY)

This comes after the February resignation of their Chief Strategy Officer, He Ruyi (何如意), who was also a core technical member.

RemeGen cited pipeline and personnel optimization, R&D investment control, and management structure tweaks to boost efficiency as reasons for the reduction. They also noted they are hiring in management, sales, and production to support commercialization.

Despite reducing R&D staff, RemeGen is still unprofitable, reporting a net loss of ~¥-1.468 billion RMB (approx. $-203.9M USD) in 2024, though this was an improvement from the prior year. Revenue grew 58.54% to ~¥ R1.717 billion RMB (approx. $238.5M USD)

Zhixiang Bio (Zhixiang Jintai 智翔金泰) (688443) saw the largest percentage decrease in R&D staff.

• End of 2024 R&D Staff: 182
• End of 2023 R&D Staff: 419
• Decrease: -56.56% YoY

Final Thoughts

The 2024 reports from STAR Market pharma companies paint a complex picture.

We see solid profit growth for many, impressive turnarounds for some, and continued massive R&D bets by giants like BeiGene.

However, significant R&D cuts and workforce reductions at other firms highlight the pressures of market competition, cost control, and strategic shifts.

Watching these dynamics unfold will be key for anyone invested in or tracking the future of Chinese biotech innovation and STAR Market pharma performance.

FAQs

What was the overall profit trend for STAR Market pharma companies in 2024?

Over half (53.04%, or 61 out of 115 companies) reported year-over-year growth in net profit. Several previously unprofitable companies, like MicroPort EP, SinoCellTech, and BioRay Pharmaceutical, achieved profitability and shed their “U” designation.

How did R&D spending change on the STAR Market in 2024?

The average R&D expenditure slightly increased to ¥353 million RMB (approx. $49.0M USD) per company. BeiGene remained the top spender by far (¥14.14B RMB / $1.96B USD). However, some companies like Kexing Biopharm significantly cut their R&D budgets (down 51.26%).

Were there major changes in R&D personnel numbers?

Yes, there were shifts in both directions. BeiGene continued to lead with the largest team (3,905) and added staff, along with companies like United Imaging Healthcare and BioRay Pharmaceutical. Conversely, RemeGen saw a large decrease (382 fewer R&D staff, -29.2%), and Zhixiang Bio had the steepest percentage drop (-56.56%).

Which company had the most dramatic profit increase?

MicroPort EP (Weidian Shengli 微电生理) showed the most significant net profit growth, soaring over 800% year-over-year and successfully turning profitable.

References

Sources:

• Original Source: Beijing Business Today (北京商报)
• Original Source Website: Beijing Business Today (北京商报)

Further Reading:

• China Briefing: China’s STAR Market Turns Four: Key Achievements and Listing Requirements
• McKinsey: Innovating for China and the world: Highlights from the 2023 China Pharma Innovation Report
• Fierce Pharma: BeiGene ramps up R&D spending to $1.6B in 2023, eyes profitability amid fierce PD-1 competition