This article only represents the author's own views.
After a prolonged downturn that began in the second half of 2021, Hong Kong’s biotechnology and pharmaceutical sector finally staged a strong rebound in 2025, emerging as one of the most closely watched segments in global capital markets. The Hang Seng Healthcare Index (HSHCI) has risen 76% year to date, significantly outperforming the broader Hang Seng Index and far surpassing the 25.64% gain recorded by China’s A-share pharmaceutical sector.
Behind the explosive growth of Hong Kong’s healthcare sector lies a record influx of southbound capital and the tangible delivery of earnings by innovative drugmakers. According to data from Securities Times’ Data Treasure, net southbound inflows reached HK$1.4 trillion in 2025. Holdings of southbound investors in the healthcare sector surged to HK$540 billion, up 125.51% from the end of 2024, injecting substantial liquidity into the market. At the same time, sector fundamentals hit an inflection point, with total outbound licensing and authorization deals for innovative drugs exceeding $130 billion. Improved revenue and profitability among companies have driven both trading activity and valuations higher.