Turning losses into profits! Rongchang Biotech's 2025 revenue and net profit both increase. Where will the company's "three driving forces" lead it?

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On March 27, Rongchang Biotech released its annual report results statement, which serves as a milestone in witnessing the turning point in the company’s development.

In 2025, the company achieved operating revenue of RMB 3.251 billion, up 89.36% year over year, maintaining double-digit growth for four consecutive years; total profit reached RMB 710 million. Compared with the net loss of RMB 1.468 billion in the same period of the previous year, it successfully turned losses into profits, achieving profitability for the first time since its A-share listing.

Unlike the one-off profit driven by a large upfront payment from overseas licensing transactions in 2021, Rongchang Biotech’s profitability this time is based on rapid scaling of domestic sales of its core products, batoclimab and vedicituzumab. Combined with improvements in R&D efficiency, consistently strong data, and a significant increase in overseas licensing income, the company’s “three engines” driving performance have already taken shape.

At the same time, China’s innovative drug industry has entered a high-quality development phase. Business development (BD) transactions have become the key driving force in global markets. Rongchang Biotech’s expansion of its product portfolio and global collaborations are facing unprecedented new opportunities.

Net profit up 148.33% year over year

Strong momentum in domestic commercialization

2025 is a critical turning point for Rongchang Biotech’s development. According to the annual report, the company’s revenue grew from RMB 1.717 billion in 2024 to RMB 3.251 billion in 2025. In 2025, attributable net profit reached RMB 710 million, successfully breaking the trend of consecutive losses. Even after excluding non-recurring gains and losses, net profit still amounted to RMB 67.6755 million, indicating that its core business has profitability.

As one of the few pharmaceutical companies in the industry that simultaneously has major products in both autoimmune and oncology fields, Rongchang Biotech currently has 2 core products and 7 approved indications in China.

In the autoimmune disease area, batoclimab is the world’s first BLyS/APRIL dual-target fusion protein. By the end of 2025, it had been approved in China for three indications: systemic lupus erythematosus, severe myasthenia gravis, and rheumatoid arthritis. In 2025, the sales volume of batoclimab reached 2.2550 million doses, up 47.92% year over year, and production volume also increased by 60.35% to 2.3770 million doses.

In oncology, vedicituzumab is China’s first original ADC drug. In recent years, it has continued to expand its indications, forming a differentiated layout across three major areas—gastric cancer, urothelial carcinoma, and breast cancer. Its indication for treating HER2-positive breast cancer was approved last year, making it the first ADC drug in China specifically for this patient population. In 2025, the full-year sales volume of vedicituzumab was 301,900 doses, up 27.31% year over year.

In China, inclusion in the medical insurance reimbursement system is an important booster for the scaling of batoclimab and vedicituzumab sales. Currently, the systemic lupus erythematosus and severe myasthenia gravis indications for batoclimab, as well as the gastric cancer and urothelial carcinoma indications for vedicituzumab, have all been included in the medical insurance formulary and successfully renewed. Through “price-for-volume” measures, the market is rapidly penetrating.

Meanwhile, efficiency improvements across the sales and R&D organizations have driven the company’s operational efficiency. In 2025, Rongchang Biotech’s selling expenses were RMB 1.111 billion, up 17.15% year over year, with a growth rate significantly lower than the revenue growth rate. By the end of last year, the autoimmune business unit’s team had covered more than 1,200 hospitals, while the oncology business unit had covered more than 1,050 hospitals, forming an extensive terminal reach network.

On the R&D side, the company’s R&D expenses last year decreased by 20.85% year over year to RMB 1.219 billion. R&D investment as a proportion of revenue fell from 89.69% to 37.49%, but R&D efficiency increased significantly. The number of international licensing cooperation transactions achieved by the company reached a historical high. This was driven by increases in technology licensing receivables and product sales cash collections. Rongchang Biotech’s net cash flow from operating activities turned from negative to positive, reaching RMB 53 million.

In addition, the H-share placement completed in May last year increased capital surplus, supporting a year-over-year increase in the company’s net assets of 81.69% to RMB 3.609 billion, making the financial structure even more robust.

3 overseas mega deals signed since last year

Internationalization is the second growth curve

In 2025, Rongchang Biotech’s overseas revenue reached RMB 970 million, up 8715.07% year over year. The gross margin was as high as 94.92%, and its globalization strategy began realizing commercial value. And as the industry moves into a high-quality development stage, BD transactions have become the core driving force in the global innovative drug market. According to data from Guosheng Securities, the total transaction amount related to China in 2025 increased to USD 138.8 billion, up 135% year over year, accounting for about 50% of the global total transaction amount.

2025 was a big year for BD in China’s innovative drug industry, and also a big year for Rongchang Biotech’s BD. Since last year, the company has reached three BD deals successively with U.S. Vor Bio, Japan’s Santen Pharmaceutical (Santen China), and multinational pharmaceutical company AbbVie. Full-year overseas technology licensing (License-out) revenue totaled RMB 895 million. This means the company’s innovative achievements have been recognized by global markets, and also indicates that the company’s business model of “selling drugs domestically + licensing overseas” is now working.

Specifically, in June 2025, the company granted Vor Bio global exclusive development and commercialization rights for batoclimab outside the Greater China region. The company secured a USD 45 million upfront payment and warrants valued at USD 80 million in one move, plus the potential milestone payments of up to USD 4.105 billion. The total amount of this BD transaction for Rongchang Biotech could reach up to USD 4.23 billion. After that, it is expected to receive royalties in the high single digits to double digits on sales.

From an internationalization perspective, this collaboration will promote global multi-center Phase III clinical trials of batoclimab for indications such as severe myasthenia gravis and Sjögren’s syndrome. The annual report shows that Vor Bio continues to advance global multi-center Phase III trials of batoclimab for treating severe myasthenia gravis. As of the end of the reporting period, patient enrollment work is underway. Recently, Vor Bio also announced the initiation of global Phase III clinical trials for Sjögren’s syndrome.

The BD deal between Rongchang Biotech and AbbVie reached in January this year is even more milestone in nature. The two parties signed an exclusive licensing agreement for Rongchang Biotech’s RC148—a novel bispecific antibody drug targeting PD-1/VEGF. Whether measured by the total transaction value of USD 5.6 billion or the USD 650 million upfront payment, this transaction once again ignited market expectations for RC148, which is seen as a cornerstone drug for next-generation immunotherapy.

At present, the indication of RC148 for a specific type of non-small cell lung cancer has received a Breakthrough Therapy Designation from the Center for Drug Evaluation (CDE) of the National Medical Products Administration (NMPA). The indication of RC148 in combination with second-line chemotherapy for non-small cell lung cancer has obtained U.S. FDA approval to proceed with Phase III clinical trials, and there is substantial potential in global markets.

In addition, overseas rights for vedicituzumab are still being driven forward by Pfizer. Currently, a Phase III clinical trial is ongoing that studies it in combination with PD-1 inhibitors for first-line urothelial carcinoma. In ophthalmology, RC28 (a dual-target fusion protein of VEGF/FGF) has been licensed to Santen Pharmaceutical, and the上市 application for diabetic macular edema has been accepted by the CDE. By this point, all four of Rongchang Biotech’s core products have achieved overseas licensing. The commercialization landscape of “innovation in China, shared globally” is gradually emerging.

It is not hard to see that Rongchang Biotech has already developed systematic overseas BD capabilities, including the ability to read out high-quality clinical data, well-reasoned clinical trial design, and extensive experience communicating with regulatory agencies.

Stock price up nearly 60% against the trend this year

Efficient R&D focusing on high-potential projects

After the surge last year, the innovative drug sector has entered an adjustment period. The Wind Innovative Drug Index (8841049.WI) fell 0.98%, but as multiple outstanding clinical research data were released, Rongchang Biotech’s A-share stock price has already risen nearly 60% since the beginning of the year.

For example, at the 44th J.P. Morgan Healthcare Conference in January this year, the company’s CEO, Dr. Fang Jianmin, disclosed the latest progress of the RC148 clinical trials. After proactive and effective communication with regulators in both China and the U.S., three Phase III clinical trials targeting lung cancer for RC148 were approved. In addition, the company disclosed for the first time that RC148 combined with platinum-based chemotherapy in first-line treatment of non-small cell lung cancer (NSCLC) showed promising potential in objective response rate (ORR) compared with its peers, with a good safety profile.

The continued readout of such data is driven by Rongchang Biotech’s continued deep cultivation of its core technology platforms and its rich pipeline under development. According to the annual report, the company has built five core technology platforms: antibody and fusion protein, ADC, bispecific antibodies, bispecific ADC, and PR-ADC payload recovery, giving it end-to-end capabilities from drug discovery to commercial-scale manufacturing.

In 2025, although the company’s R&D spending decreased year over year, it still maintained a high scale of RMB 1.219 billion. During the full year, it filed 96 new invention patent applications, obtained 29 authorizations, and accumulated 682 patent applications and 174 authorizations, building a solid intellectual property moat. In the pipeline, RC278 (CDCP1 ADC) has entered Phase I clinical trials. RC288 (PSMA/B7H3 bispecific ADC) is in the IND preparation stage, and the pipeline reserve is sufficient.

On clinical advancement, the company made key progress across multiple products throughout the year: the Phase III clinical trial of RC148 in combination with chemotherapy for first-line squamous NSCLC is recruiting patients; batoclimab’s new Phase III trials for ocular-morbid severe myasthenia gravis and pediatric IgA nephropathy have also been initiated. Through a layout of “expanding core products + handing off to subsequent pipeline candidates,” the company is building long-term growth momentum.

At the earnings call, Chairman Wang Weidong introduced the company’s key work arrangements for 2026, emphasizing that R&D innovation is the top priority for the company’s development, and that the R&D pipeline is the company’s “lifeline.” Last year, the company optimized its R&D pipeline, improving the accuracy of resource allocation and R&D efficiency significantly. In 2026 and beyond, the company will continue to use R&D innovation as its core driving force, accelerating the transformation of new molecules from early R&D projects to clinical trial stages by advancing reforms to the mechanisms and systems, upgrading technical methods, and building new technology platforms, in order to drive more new indications to be approved for commercialization and to provide continuous, ample project sources and pipeline reserves for domestic and international commercial sales and BD collaborations.

(This article does not constitute any investment advice. The information disclosure content shall be based on the company’s announcements. Investors act on this at their own risk.)

By/Li Yi

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