① Wuxi Apptec has revised its projected total revenue for 2026 upward from RMB 51.3–53.0 billion to RMB 58.5–60.5 billion;
② The company is further accelerating its global capacity expansion, with projected capital expenditures for 2026 revised upward from RMB 6.5–7.5 billion to RMB 7.5–8.5 billion;
③ According to Zheshang Securities, leading CXO companies are gradually returning to a revenue growth range of 15%–30%.
During trading this morning, Hong Kong-listed pharmaceutical outsourcing stocks collectively strengthened,$WUXI APPTEC (02359.HK)$rising more than 11%,$GENSCRIPT BIO (01548.HK)$up 10%,$ASYMCHEM (06821.HK)$gaining over 8%,$PHARMARON (03759.HK)$rose nearly 7%,$WUXI BIO (02269.HK)$up nearly 4%.
On the news front, last night the CXO leader$WUXI APPTEC (02359.HK)$released its interim report, raising its full-year 2026 guidance: it now expects total company revenue for 2026 to increase from RMB 51.3–53.0 billion to RMB 58.5–60.5 billion, and year-over-year growth in continuing operations revenue to rise from 18%–22% to 35%–39%.
In addition, to better meet rapidly growing client demand, the company is further accelerating its global capacity deployment and has advanced the launch of its new Changzhou facility. Capital expenditures for 2026 are now projected to increase from RMB 6.5–7.5 billion to RMB 7.5–8.5 billion.
Oriental Securities noted that the company’s newly built overseas capacity will further enhance the flexibility of its global supply chain, better supporting commercial-scale production needs for small molecules, oligonucleotides, peptides, and other products, thereby establishing a more resilient supply network and steadily advancing toward global leadership.
Innovative drug orders continue to scale up significantly
Notably, domestic CXO companies are experiencing an improvement in the growth rate of innovative drug orders.
For example,$PHARMARON (03759.HK)$The 2026 interim earnings forecast indicates that, as the company’s small-molecule CDMO service pipeline continues advancing into later stages, newly signed orders have grown by over 30% year-over-year; meanwhile, Medicilon stated that its performance growth is primarily driven by a clear recovery in global innovative drug R&D demand, with rising market demand supporting simultaneous improvements in both business volume and pricing, and a robust order backlog laying a solid foundation for sustainable earnings growth.
According to Zheshang Securities, since Q1 2025–2026, leading CXOs have seen their revenue growth rates gradually return to the 15%–30% range, with order growth at companies like Wuxi Apptec and Pharmaron already recovering to pre-global public health emergency levels. Breaking this down by domestic versus international demand:
Domestic-demand-focused CXOs: A significant supply-demand gap for experimental monkeys persists, driving both volume and pricing for preclinical safety assessment CRO orders into a sustained surge phase. Due to surging demand and tight monkey supply, preclinical safety assessment CROs collectively entered an order boom period starting Q4 2025.
External demand for CXOs: A new CAPEX cycle for CDMOs has commenced since 2025, and the rationale for RMB-denominated R&D costs of high-potential global innovative drug assets continues to strengthen. Domestic CDMOs are experiencing sustained high growth in new molecular entity (NME) services, and their competitive advantages on the global stage are expected to materialize further.
Synthesizing views from various institutions indicates that business development (BD) activity—remaining highly robust—is likely the primary driver behind the current surge in orders. Data shows that the total value of China’s pharmaceutical outbound licensing deals in the first half of 2026 reached USD 99.7 billion, 1.9 times the full-year 2024 figure of USD 52.2 billion and approximately 73% of the full-year 2025 total of USD 135.7 billion. Despite frequent disruptions from overseas policy changes, the full-year BD transaction volume is still poised to reach a new record high.
The aforementioned institutions noted that over the medium to long term, China’s comparative advantages in drug discovery and clinical proof-of-concept stages remain irreplaceable. Until domestic pharmaceutical companies fully mature in their independent global capabilities, BD-driven international expansion is likely to become a常态化 practice. Royalty payments from overseas licensing deals will continue to replenish R&D funding and steadily expand domestic demand within the CXO industry.
Zhongyou Securities pointed out that from the demand side, overseas R&D and manufacturing outsourcing demand is steadily recovering. Domestic Big Pharma companies are consistently increasing their R&D expenditures year-over-year, while Biotech firms—benefiting from improved sector sentiment and a rise in IPOs this year—are gradually emerging from their trough. Additionally, sustained strength in BD activity is expected to translate into stronger demand for R&D outsourcing, which may materialize in 2026.
The firm also noted that on the supply side, following the cycle from 2020–2023—characterized by rapid industry upswing, upstream capacity expansion, intensified competition, declining profitability, and subsequent industry-wide capacity rationalization—the overall pricing level has now reached a trough and is poised for recovery. Supply-side consolidation has increasingly stabilized, and with robust demand, profitability is expected to further improve in 2026.
Editor/melody