What happened
China's first AI-assisted innovative drug, Aipuswei (hydrochloride istevir tablets), has been conditionally approved by the National Medical Products Administration for treating mild to moderate COVID-19 in adults. Developed by Westlake University, Westlake Laboratory, and Westlake Pharmaceuticals, it took only three and a half years from discovery to clinical trial completion.
Following the approval news, Aoyang Health's stock price surged to the daily limit within four minutes on September 7, with buy orders exceeding 2 million lots. The company's net profit for the first half of the year was 24 million yuan, down 23.42% year-on-year, and four institutions exited its top ten circulating shareholders in Q2.
According to data from Securities Times, nearly 40 A-share concept stocks are involved in AI medical business, with a combined market value of about 1.07 trillion yuan as of September 4. Eight stocks have risen over 10% this year, led by Bio-Techne with a 53.77% increase.
Why it matters
The approval of Aipuswei marks a significant milestone, demonstrating that AI-assisted drug development is efficient and feasible. This could accelerate the integration of AI in medical research and treatment, potentially transforming the industry from 'cure medicine' to 'care medicine'.
With policy support aiming for full coverage of AI-assisted primary care by 2030, and the market projected to grow from 8.8 billion yuan in 2023 to 315.7 billion yuan by 2033, the AI medical sector offers substantial growth opportunities. This has drawn institutional attention to related concept stocks.
The surge in Aoyang Health's stock highlights the market's enthusiasm for AI medical concepts, but investors should note the company's recent financial performance and institutional exits, indicating potential volatility.
Key facts
Aipuswei is the first original drug approved in China that was developed with AI assistance, from discovery to clinical trials in three and a half years.
The drug is conditionally approved for treating adult mild and moderate COVID-19 infections.
Twelve AI medical concept stocks have received 'positive' ratings from five or more institutions, including Mindray Medical, Hengrui Medicine, and Aier Eye Hospital.
The AI medical market in China is expected to grow from 8.8 billion yuan in 2023 to 315.7 billion yuan by 2033, with a CAGR of 43.1%.
What to watch next
Watch for further developments in AI-assisted drug development and regulatory approvals, as this first success may pave the way for more AI-driven drugs.
Monitor the performance of AI medical concept stocks, especially those with strong institutional support, as the sector may continue to attract investment.
Keep an eye on policy implementations and technological advancements that could expand AI applications in healthcare, potentially impacting the industry's growth trajectory.