A：In 2025, Xuan Zhu Bio successfully landed in Hong Kong stocks, entering a new stage in capital. Since then, the company has made a number of major breakthroughs, such as the inclusion of Hong Kong shares, the completion of full circulation, liquidity and shareholder diversity significantly improved. In 2026, the company's first innovative tumor drug will be released throughout the year, while PPI innovative drugs will also open the new year's market expansion. As the only innovative drug platform under Sihuan Pharmaceutical, Xuan Zhu Bio can make full use of the resources and financial support of Sihuan Pharmaceutical. As a senior innovative pharmaceutical company in Hong Kong, Sihuan Pharmaceutical's good revenue and financial position provide a strong guarantee for Xuan Zhu Bio, and will promote the rapid development of Xuan Zhu Bio in the commercialization process.

A：Xuanzhu Biology was established in 2012. It was initially wholly-owned by Sihuan Pharmaceutical to acquire Shandong Xuanzhu Enterprise. It started from a research and development laboratory and has grown into an innovative drug platform company integrating research and development, production and sales over the past 14 years. Important milestones in its development include: focusing on the research and development of small molecule innovative drugs from 2013 to 2017; In 2020, the company will complete the financing and acquire Kangming Baiyao, a biological drug company, to form a dual platform capability of small molecules and large molecules. In 2023, the first innovative drug, proton pump inhibitor Analadona, will be listed. 2025 will become an important turning point in the company's development. Two innovative tumor drugs were approved and successfully landed in the Hong Kong stock market. Xuan Zhu Biology has a clinical development and tumor sales center and a small nucleic acid research and development center at its headquarters in Beijing. It has a production base in Shijiazhuang. In addition, it has clinical experimental research and development teams and non-tumor marketing centers in Xuanzhu, Shandong Province and Shenzhen, forming an all-round comprehensive platform covering research and development, production and sales.

A：At present, Xuanzhu Bio has commercialized three innovative drugs, including PPI inhibitors, CDK246 (for breast cancer treatment) and Oak inhibitors (for non-small cell lung cancer treatment). These three products together constitute The company's sales "troika". In 2025, the company's revenue will grow significantly, gross profit will double, net profit will narrow by 56%, and with the release of three listed innovative drugs and fine management cost control, it is expected that the financial aspects will usher in an important inflection point from 2026 to 2027, and the profit potential will continue to be released.

A：This product is specially designed in molecular structure and has a very low dependence on CYP2719 enzyme. Only 3.5% of the drug is metabolized by this enzyme, thus ensuring the stability of the drug's blood concentration. In addition, it has a dual channel excretion system of intestine and kidney, each channel accounts for 50%, which is especially suitable for the elderly and patients with renal insufficiency, avoiding the problem of excessive renal function load caused by single path excretion. At the same time, the risk of drug interactions (DDI) is greatly reduced due to multiple enzyme metabolism.

A：The safety of this product has been highly recognized by clinicians. Compared with PPI, its nephrotoxicity, gastric toxicity and other adverse reactions are lower. Therefore, doctors are more inclined to use this product in patients with severe ulcers who cannot tolerate PPI. This also indicates that in the future market, the product will compete with PPI and another drug called pickup, and is expected to occupy a place in it.

A：At present, PPI and related market size is close to 20 billion, and this innovative drug PI is expected to share this market with pickup trucks. With its differentiated clinical advantages, product penetration is expected to increase, especially after the successful negotiation of health insurance and the completion of the original price renewal, further confirming the commercial value and differentiated innovation of the drug. At the same time, through the expansion of indications (such as reflux esophagitis and Helicobacter pylori root), it is expected that the product release logic is clear, the next two years to maintain the original penetration trend key.

A：Xuanyuan Ling has significant advantages in approved new indications, including second-line and post-line combination therapy for HR-positive and HER2-negative advanced breast cancer, as well as single-drug post-line therapy. Its uniqueness is that, as the only approved first-line indications of similar products, covering a complete pattern of first-line to second-line and post-line treatment. In addition, it has excellent efficacy and safety, good blood-brain barrier permeability, and can inhibit CDK2 targets, which may delay the occurrence of CDK4/6 inhibitor resistance and achieve cross-line therapy. Finally, as the second innovative oncology drug, Xuanfenib (Ogatinib) preparation also shows the safety advantage of continuous administration, which can realize uninterrupted medication.

A：The mystery preparation is mainly aimed at the newly diagnosed patients with small cell lung cancer with brain metastasis, of which 24% to 42% of the patients have brain metastasis. In the first and second generation drugs, the effective rate of brain metastasis is low, less than 50%. Although the third generation drugs have been improved, the treatment effect on patients with brain metastasis is still not ideal, and there are obvious pain points. In addition, no matter which generation of drugs, there are problems of drug resistance mutations, such as G1202 site mutations. In terms of safety, past drugs generally have safety risks, including gastrointestinal and liver toxicity, as well as neurotoxicity, such as the neurotoxicity of loratinib is particularly prominent.

A：Oak products have focused on improving the objective remission rate (OR) of the brain in terms of efficacy, with clinical phase III data showing that it has reached 91.7 percent, and has a cliff-leading advantage in the second generation of drugs, and is also excellent compared to the third generation of drugs such as Noatinib. In terms of safety, the withdrawal rate of Oak products (the rate of withdrawal due to side effects) is only 1.5, which is the lowest among similar drugs, thanks to its better safety and higher patient tolerance.

A：As the Oak product was approved in June 2022, it failed to participate in last year's health insurance negotiations, but this year will face health insurance negotiations and is expected to enter health insurance, thus ushering in the first year of commercial health insurance release in 2027. At present, the product has covered nearly 200 hospitals across the country, especially many top three hospitals, laying a solid foundation for the market development after the follow-up medical insurance negotiations.

A：The company has a significant advantage in the technology platform, has successfully developed three innovative drugs, and each technology platform has been verified. The small molecule drug research and development system has been established since 2012. The large molecule biopharmaceutical platform was formed through the acquisition of Kangming Baiao, while the small nucleic acid platform was completed last year. PCC products are expected to be launched by the end of this year or next year. Focus on a wide range of areas, including digestion, cancer, metabolism and other chronic diseases, is committed to becoming a platform-based innovative drug company, the future pipeline will be supported by products in multiple fields.

A：7797 is an in-development drug that we define as the next generation of running inhibitors, mainly for targets where there is a large demand in the market. This product has attracted much attention due to its higher selectivity. Unlike traditional top 1 and top 2 inhibitors, it can effectively reduce the risk of blood toxicity. At present, the product has been approved by IND in February last year, and is expected to complete the first phase of clinical dose climbing in Q4 this year, when clinical data will be gradually read out.

A：This target is highly attractive because past BD cases have shown that there is a huge market potential for drugs targeting this type of target, such as a company's transaction value of up to 1.4 billion euros in this area. We are conducting BD authorization communication with mainstream customers in Europe, America and Japan and South Korea to seek continuous blockbuster BD cooperation. In addition, the company's strategy on BD also includes the use of existing global IP for full authorization and agency, the introduction of early or late differentiated innovative products to promote domestic commercialization.

A：Last year and this year, we partnered with boston oncology, a company located in the Middle East, to bring two innovative oncology drugs that have been approved in China to the Middle East market. Through this cooperation, our access registration process in 21 countries in the Middle East has been more smooth. We have received milestone payments of more than US $0.1 billion and are expected to receive a fixed proportion of sales fees in the future, which marks a major breakthrough in the BD field.

A：Future catalysts include health insurance negotiations after the first-line approval of CDK26 (this year) and the listing of PPI inhibitors for reflux esophagitis and Helicobacter pylori eradication (next year). In addition, 7797 and other new target research and development projects such as ITK, PHEK, etc. will also be carried out this year, and has been approved for new health insurance coverage, ready for product release. In the next few years, the company will further enhance its product pipeline strength and revenue diversification channels through continuous research and development innovation, BD cooperation to introduce high-quality assets and internal and external integration.

A：The investment highlights read out can be summarized from four aspects: remarkable results have been achieved in commercialization, and profit turning point is expected to be realized soon; Core products have entered a volume cycle, and medical insurance negotiations will promote their rapid volume. It has four major research and development platforms and continues to produce innovative candidate drugs. At the same time, relying on the synergistic advantages of the whole industrial chain of Sihuan Pharmaceutical, it will enhance its innovation strength and commercialization capability through endogenous growth and extensive mergers and acquisition.