SCIENTECH(02291): After more than a month of counter-trend stock price rally, "unexpectedly" catches the small nucleic acid tailwind

On October 20, GSK officially announced that its antisense oligonucleotide (ASO) drug bepirovirsen has received FDA approval for marketing and will be used in combination with NrtI for the treatment of chronic hepatitis B virus infection in adults. The drug is not only the first antisense oligonucleotide approved by the FDA for chronic hepatitis B, but also the world's first small nucleic acid drug for hepatitis B with "functional cure" as its primary goal. For global small nucleic acid drug developers, GSK's success further validates the commercial feasibility of small nucleic acid/antisense oligonucleotides in the field of functional cure for chronic diseases. For domestic pharmaceutical companies, it is expected to enhance the market's willingness to revalue the innovation platforms and the overseas expansion and BD value of assets in the small nucleic acid track. For SCIENTECH (02291), which has positioned itself in the small nucleic acid track through mergers and acquisitions, this is undoubtedly an unexpected delight. The "unexpected delight" brought by positioning in small nucleic acids On the evening of August 21, SCIENTECH issued an announcement stating that the company plans to acquire 54.2384% equity of Shanghai Minwei Biotechnology Co., Ltd. ("Minwei Biotech") for RMB 1.088 billion in cash. Although the company subsequently announced on September 21 and October 19 respectively a delay in despatching the circular for the acquisition of Shanghai Minwei Biotech equity, as this acquisition is a typical "industrial capital buying a ship" transaction, i.e., the buyer obtains a mature platform and clinical pipeline in one step through a cash-controlled acquisition, while the seller is an asset under the same actual controller, the market generally believes that the certainty of this transaction proceeding is relatively high. Therefore, the market has still priced SCIENTECH over the past month according to the logic of "device company transforming into an innovative drug platform." It is understood that the acquisition of Minwei Biotech is both an internal asset restructuring within SCIENTECH's parent company and a cross-sector integration of "devices + drugs." According to the acquisition announcement, Minwei Biotech owns three major technology development platforms: GPCR agonist screening, RAF ultra-long-acting molecules, and Dual-siRNA, and has thereby developed 6 candidate drugs at different clinical stages, covering the GLP-1/GIP multi-target track in chronic disease directions such as obesity, dyslipidemia, and hypertension. Among them, the most advanced is MWN109 injection (obesity indication), which has entered Phase III clinical trials. In addition, in 2025 Minwei Biotech licensed MWN105 (GLP-1/GIP/FGF21 triple agonist) to Sidera, with upfront and near-term milestone payments totaling US$35 million already received, plus up to US$1.01 billion in milestone payments and sales royalties, and also obtained a 9.99% equity stake in Sidera. This licensing deal also directly enabled it to turn profitable in that year. After the injection of Minwei Biotech's assets, SCIENTECH is expected to transform from a device stock suppressed by centralized procurement into a platform pharmaceutical stock holding heavyweight innovative drug assets such as GLP-1 and siRNA as well as overseas licensing milestone expectations. In short, the company will undergo a "valuation anchor switch." The main reason why SCIENTECH is expected to ride the recent "small nucleic acid" tailwind lies in MWN117, an innovative asset under Minwei Biotech with "small nucleic acid characteristics." As an siRNA drug targeting INHBE, MWN117 launched a 48-patient Phase I clinical trial in China on September 11. In fact, small nucleic acid drugs have attracted much attention in China in recent years. In September last year, Mabwell Bioscience and Aditum Bio established a NewCo to license the dual-target siRNA drug 2MW7141 overseas; and this year there was also the case of Sino Biopharmaceutical acquiring Hejiya Biotech wholly for up to RMB 1.2 billion. GSK's approval of a hepatitis B small nucleic acid drug this time is expected to further transmit the "small nucleic acid platform fever" from the primary market to the secondary market globally, and SCIENTECH's acquisition of Minwei Biotech happens to fall within this time window. How long can the stock price continue after rising against the market for more than a month? It has been observed that from September 18 to October 23, SCIENTECH's stock price recorded a maximum interval gain of 43.56%. By comparison, the Hang Seng Healthcare Index saw a certain pullback during the same period, with a maximum interval drawdown of 15.35%. Meanwhile, the median interval declines of Hong Kong cardiovascular medical device concept stocks and Hong Kong innovative drug stocks were 9.35% and 8.18%, respectively. The stock price trend significantly stronger than the sector also indicates that SCIENTECH generated its own alpha during this interval. In addition to the above-mentioned main reason of valuation anchor switching, another reason supporting SCIENTECH's stock price rise is its continuous share buybacks. It is understood that since the beginning of this year, SCIENTECH has been continuously conducting small but frequent buybacks, with 55 buybacks year-to-date, repurchasing 4.507 million shares, accounting for 1.30% of its total share capital, with a cumulative amount of HK$52.22 million. In terms of staged stock price performance, from September 18 to October 9, SCIENTECH's stock price surged 28.67% from HK$10.57 to HK$13.60, technically a clear acceleration phase after bottoming out and repairing, with the corresponding market trend also showing a clear shift from weak to strong. During this interval, along with the stock price rally, its 5-day moving average continued to cross upward and eventually formed a typical bullish alignment. During the period, SCIENTECH's buyback amount was HK$1.7355 million. Although slightly lower than its average daily turnover of over HK$2 million at the time, the "bottom-support signal" brought by the buybacks laid the market sentiment foundation for the subsequent continued upward attack after the stock price fluctuated sideways. From October 12 to October 20, although the company's stock price showed some sideways fluctuation, it remained in high-level consolidation with limited pullback throughout the period, showing relatively strong accumulation characteristics; afterward, the company's stock price continued to attack from October 21 to 23 and set a new interval high. From October 20 to October 23, the MACD histogram indicator on the technical front rose from 0.17 to 0.24, with the corresponding DIF value rising from 0.44 to 0.55, which to some extent indicates that SCIENTECH's breakout momentum during this interval has been re-strengthened, rather than the volume-less upward attack shown on the surface. At the same time, its RSI6 indicator during the interval was already below the level near the October 12 high when the intraday stock price hit a new interval high, which also verifies that its current momentum structure has not shown obvious top divergence, while the KDJ-J value approaching 100 and CCI above 150 indicate that the company's short-term stock price has now entered an accelerated zone. Looking at the single-day performance on October 23 alone, SCIENTECH's intraday high was significantly above the 5-day, 10-day, and 20-day moving averages, and 11.11% above the 20-day line. Although the short-term deviation rate is relatively large, the stock price remains in an upward channel indicating a strong trend. At present, SCIENTECH's narrative of "stable cash flow from a device leader + early-stage innovative biotech assets" has won it a short-term premium. On the trading front, if the circular is despatched on November 19, in the subsequent independent board committee and independent financial adviser opinions and the extraordinary general meeting vote, the fairness of the acquisition pricing under the connected transaction background will undoubtedly be the focus of deliberation, and this may also directly determine the final outcome of this transaction and the direction of the company's subsequent stock price trend.