The Hong Kong market was subdued on September 17, yet the AI-driven drug discovery sector charted its own course with remarkable strength. The benchmark index tracked by the Hong Kong Stock Connect Healthcare ETF (159137) powered up as much as 2.77% intraday before closing 1.93% higher, with AI pharma-related components representing nearly 70% of its holdings.

Meanwhile, the Hong Kong Stock Connect Innovative Drug ETF (520880) also posted a solid 1.17% gain, as its key holdings have been aggressively expanding their AI drug discovery capabilities. Leading the charge was GenScript Biotech, often considered the "picks-and-shovels" play in AI pharma, which surged over 17% at one point to hit a fresh three-year high before settling at a 14.31% gain for the session.

Pure-play AI pharma names followed suit, with InSilico Medicine advancing 6.86% and Biocytogen-B, an AI-driven antibody discovery platform, climbing 4.27%. The AI-plus-CRO model also gained traction, with Joinn Laboratories and Tigermed both posting substantial gains. Three blockbuster partnerships landed on September 16, igniting the entire sector's sentiment. Oriental Securities noted that as AI drug discovery enters a critical window for commercial value realization, leading domestic players are accelerating asset out-licensing, pipeline advancement, and platform enablement—sharpening their commercialization capabilities with a wealth of catalysts on the horizon.

Eli Lilly's TuneLab has joined forces with GenScript, enabling large-scale wet-lab validation of AI-designed candidates. GenScript will provide protein expression, purification, and characterization services to TuneLab's partner companies, converting AI-predicted sequences into standardized biological validation data.

Novo Nordisk has partnered with Anthropic, bringing frontier large language models deeper into core drug development workflows. The two parties will assess the application of Claude and Claude Science in novel drug discovery and development, while further strengthening AI-driven software engineering.

In a separate development, ByteDance's AI pharma venture has spun off into its own standalone fundraising round. Anew Labs, the AI drug discovery platform incubated by ByteDance, has secured $290 million in its first external financing round, signaling that major internet companies are pushing their AI pharma projects beyond internal R&D and toward independent industrialization and capitalization.

China Merchants Securities highlighted that these three events collectively underscore the global industrial trend in AI drug discovery. Upstream capital continues to pour in, midstream general-purpose large models are entering real-world drug R&D scenarios, and downstream demands large-scale, high-quality wet-lab experiments to validate AI outputs.

CITIC Construction Investment pointed out that current AI giant investments in pharma concentrate on target validation and hit discovery. To optimize and iterate their models, the demand for wet-lab facilities is steadily rising, and future discoveries of novel drug modalities, molecules, and targets will deliver sustained increments to the downstream supply chain. Should applications extend into preclinical, clinical, and manufacturing phases, this would create structural tailwinds for CROs and CDMOs.

As AI drug discovery industrialization accelerates, how can investors ride this trend through ETFs? Two T+0 trading tools are worth attention. The Hong Kong Stock Connect Healthcare ETF (159137) passively tracks the Hong Kong Stock Connect Healthcare Thematic Index, with AI pharma content approaching 70%. Its representative constituents include XtalPi Holdings, GenScript Biotech, and the WuXi AppTec trio. The off-exchange feeder fund code is 026922.

The Hong Kong Stock Connect Innovative Drug ETF (520880) passively tracks the Hang Seng Hong Kong Stock Connect Innovative Drug Select Index, with 100% exposure to innovative drug R&D firms. Its representative holdings include InSilico Medicine, Biocytogen-B, and CSPC Pharmaceutical Group. The off-exchange feeder fund code is 025221.

Data sources include public information from the Shanghai, Shenzhen, and Hong Kong exchanges, as well as China Securities Index and Hang Seng Index companies. Weight data is as of August 31, 2026. Institutional perspectives draw from CITIC Construction Investment's September 15, 2026 deep-dive report on CXO and AI pharma, Oriental Securities' August 1 research note on the pharmaceutical and biotech sector, and China Merchants Securities' September 16 commentary on the three events confirming the global AI pharma trend.

Regarding the "AI pharma content" note: the Hong Kong Stock Connect Healthcare Thematic Index tracks 17 AI pharma-related constituent stocks (including pure-play AI pharma platforms, AI-plus-CRO entities, and innovative drug developers with AI exposure), with their combined weight at 69.52%.

On specific constituent weights: within the Hong Kong Stock Connect Healthcare Thematic Index, the WuXi family (WuXi Biologics 18.77% + WuXi AppTec 14.70% + WuXi XDC 5.54%) totals 39.01%, followed by GenScript Biotech at 8.15% and XtalPi Holdings at 4.02%. In the Hang Seng Hong Kong Stock Connect Innovative Drug Select Index, CSPC Pharmaceutical Group holds 9.64%, InSilico Medicine 3.15%, and Biocytogen-B 0.62%.

On fund fees: ETF funds do not charge sales service fees. When investors subscribe for or redeem fund shares, the authorized broker may charge a commission of up to 0.5%, which includes fees levied by the stock exchange and registration institutions. Detailed fee structures are outlined in each fund's legal documentation.

Special notice: the fund manager has assessed the risk level of the Hong Kong Stock Connect Healthcare ETF and its feeder fund, as well as the Hong Kong Stock Connect Innovative Drug ETF and its feeder fund, as R4—medium-to-high risk—suitable for aggressive (C4) and above investors.

Risk disclaimer: the index constituents mentioned herein are for display purposes only, and any individual stock description does not constitute investment advice in any form, nor does it represent the holdings or trading activities of any fund under the manager's umbrella. Any information appearing in this article (including but not limited to individual stocks, commentary, forecasts, charts, indicators, theories, or any form of expression) is for reference only, and investors bear sole responsibility for their own independent investment decisions. Furthermore, any views, analyses, or projections in this article do not constitute investment advice to readers of any kind, and no liability is assumed for any direct or indirect losses arising from the use of this content. The performance of other funds managed by the fund manager does not guarantee fund performance, past performance does not represent future results, and fund investing carries risks.

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