Chinese innovative drugs go global with "huge orders", raking in $66 billion in half a year.
Image source: TuChong
Author | Zhang Yuqi
Editor | Wen Siting
Starting from the reform of the drug review and approval system in 2015, the past decade has been the most rapidly changing decade in the history of Chinese medicine. During this decade, Chinese innovative drugs began to go global from the domestic market. Driven by both innovation momentum and policy dividends, the global pharmaceutical industry is accelerating towards the "Chinese Moment".
According to a research report by Zhongyou Securities, in the first half of 2025, the total amount of Chinese innovative drug License-out (licensing authorization) has approached $66 billion, surpassing the total BD (business development) transaction volume in 2024.
The frequent occurrence of huge transactions is a major highlight of the "going global" of Chinese innovative drugs. Among them, the most eye-catching is a transaction from 3SBio Inc. (01530.HK). In May this year, Shenyang 3SBio announced that it had granted Pfizer (PFE.US) the rights to develop, produce, and commercialize its self-developed breakthrough PD-1/VEGF bispecific antibody SSGJ-707 globally (excluding the Chinese mainland). The upfront payment of up to $1.25 billion set a new historical record and triggered a strong response in the market.
This transaction is undoubtedly a vivid footnote to China's deep integration into the global pharmaceutical innovation network. Since the successful approval of zanubrutinib by BeiGene (ONC.US; 06160.HK; 688235.SH) in the United States in 2019, which achieved the "zero breakthrough" of Chinese innovative drugs going global, to date, BD strategies represented by the traditional licensing authorization, M&A models, and the emerging NewCo model have become the golden path for Chinese innovative pharmaceutical companies to access the global market. From technology introduction in the past to reverse output now, the "going global" of Chinese innovative drugs is evolving from quantitative change to qualitative change.
Many interviewees from pharmaceutical companies and the pharmaceutical investment community told Time Finance that "a good product or technology, if it wants to be truly recognized by the market, definitely cannot be limited to the domestic market. In the past, the question was not whether to go global, but whether it was possible. Currently, the strength of Chinese innovative pharmaceutical companies is constantly improving. Most pharmaceutical companies have the ability to go global and have also been recognized by multinational pharmaceutical companies (MNCs). Going global, that is, stepping onto the international stage, is an inevitable step."
In recent years, cooperating with MNCs has become the strategic focus of Chinese innovative pharmaceutical companies, and MNCs' attention to Chinese innovative drug assets has also increased simultaneously.
The "Report on the BD of Chinese Innovative Pharmaceutical Companies: Towards the Global Market" released by Arterial Network in June this year shows that MNCs' preference for Chinese innovative drug assets is mainly reflected in three aspects: large quantity, high amount, and global leadership. In the past decade, leading MNCs have accelerated their cooperation with Chinese pharmaceutical companies. Currently, more than 90% of leading MNCs have conducted BD transactions with Chinese innovative drug pipelines. In the past five years, China has become the country with the fastest-growing BD going global. Since 2015, especially after 2021, the total amount of BD transactions, upfront payments, and single transaction amounts of MNCs in China have increased rapidly. The cooperation models between MNCs and Chinese innovative pharmaceutical companies have also been further upgraded, and they have begun to increase investment in early-stage innovation.
According to the incomplete statistics in the above-mentioned theme report, in the transactions between MNCs and Chinese innovative pharmaceutical companies, Merck & Co., Inc., AstraZeneca, and Eli Lilly and Company rank among the top three. Since 2015, Merck has had nearly 20 significant transactions with Chinese pharmaceutical companies.
The rapid rise of Chinese innovative drugs in the global industrial chain is not accidental. Behind this leap in energy level is not only the inevitable result of the continuous release of institutional dividends after a decade of drug review reform but also the proof of the strength of Chinese pharmaceutical companies from technology following to global competition and cooperation.
In the wave of global pharmaceutical innovation, China is showing unprecedented vitality and influence. With the continuous iteration of technology and the deepening of international cooperation, the "going global" of Chinese innovative drugs will enter a new stage of "both quality and scale improvement". From imitation and following to original innovation, the new era of Chinese innovative drugs has arrived.
01 Go global or be left behind
Entering 2025, the phrase "going global" has frequently appeared in various occasions in the pharmaceutical industry and has become the core topic that cannot be avoided in everyone's conversations. The industry consensus of "go global or be left behind" has become even more deeply rooted this year.
On May 20, 3SBio reached a global licensing agreement with Pfizer with an upfront payment of $1.25 billion and a total transaction value of $6 billion, shocking the entire pharmaceutical industry. On July 24, the agreement officially came into effect. The two parties agreed that on the basis of the company's announcement on May 20 that it would receive an upfront payment of $1.25 billion, 3SBio would additionally receive $150 million to further grant Pfizer the exclusive rights to develop and commercialize SSGJ-707 in the Chinese mainland. At the same time, Pfizer will subscribe for common shares of 3SBio worth $100 million.
In fact, the boom in the overseas transactions of domestic innovative drugs is far more than this.
In the first half of this year, many domestic pharmaceutical companies, including Union Laboratories Limited (03933.HK), Jiangsu Hengrui Medicine Co., Ltd. (600276.SH, 01276.HK), Harbour BioMed (02142.HK), CSPC Pharmaceutical Group Limited (01093.HK), Innovent Biologics, Inc. (01801.HK), Yingewen Bio (09606.HK), Kang诺亚 Biologics Limited (02162.HK), and Shanghai Mabwell Biosciences Co., Ltd. (688062.SH), have all licensed out their pipelines. The transaction projects include popular targets such as monoclonal antibodies, bispecific antibodies, GLP, and ADC, covering various common diseases such as tumors, autoimmune diseases, and weight loss.
According to the incomplete statistics of Time Finance, in the first half of this year, there were more than 70 overseas licensing transactions from Chinese pharmaceutical companies to MNCs. According to some disclosed data, the total upfront payment reached nearly $3 billion, and the total transaction value reached $53.136 billion.
In terms of the upfront payment amount, in March this year, the transaction prepayment after Novo Nordisk (NVO.US) reached a cooperation with Union Laboratories ranked second at $200 million, second only to the transaction between 3SBio and Pfizer. The subject of this exclusive licensing agreement is Union Laboratories' GLP-1/GIP/GCG triple-target receptor agonist UBT251. In this transaction, Novo Nordisk will obtain the exclusive rights to develop, produce, and commercialize the product globally outside the Chinese mainland, Hong Kong, Macao, and Taiwan. Union Laboratories will receive substantial revenue, including being eligible to receive a $200 million upfront payment and up to $1.8 billion in potential milestone payments, as well as tiered sales royalties calculated based on the annual net sales in the region.
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UBT251 is still in the early stage of clinical development. As of now, this pipeline has been approved in China to conduct clinical trials for adult type 2 diabetes, overweight or obesity, metabolic-associated fatty liver disease (MAFLD), and chronic kidney disease (CKD), and has also been approved in the United States to conduct clinical trials for adult type 2 diabetes, overweight or obesity, and chronic kidney disease (CKD).
When asked about the transaction details, valuation, and opportunities of the deal, Cao Chunlai, the general manager of Union Biotech, did not give a direct response to Time Finance, only saying that "future external publicity needs to be communicated with the partner."
Gu Yang, a partner at Han Kun Law Offices, the legal team involved in this transaction, told Time Finance that "the deal was facilitated by the alignment of the commercial interests of both parties and the market trend, as well as the value advantages of the transaction target product UBT251. Union Laboratories has been committed to achieving innovative transformation, actively deepening its layout, and continuously expanding its global market. In recent years, Chinese innovative drugs have also received more attention from multinational pharmaceutical giants. These multinational companies are willing to invest in potential globally competitive products in the Chinese market through licensing transactions."
"After the transaction is completed, we will尽快 advance UBT251 to the global phase 1/2 trial for obesity indications," Novo Nordisk told Time Finance. On June 20 this year, Union Laboratories announced externally that it had received an upfront payment of $180 million (after deducting Danish withholding tax) from Novo Nordisk.
Harbour BioMed, known as the "king of Chinese BD transactions," announced another overseas licensing transaction in late June this year. It reached a global strategic cooperation with Japanese pharmaceutical giant Otsuka Pharmaceutical Co., Ltd., licensing the global development rights (excluding the Greater China region) of its self-developed BCMA/CD3 bispecific T cell engager (TCE) HBM7020 to Otsuka Pharmaceutical. The total transaction value is as high as $670 million.
Dr. Wang Jinsong, the founder, chairman, and CEO of Harbour BioMed, said in an interview with Time Finance that this cooperation was reached based on the common pursuit of technological breakthroughs in the field of autoimmune disease treatment by both parties. In recent years, the incidence of autoimmune diseases has been continuously rising globally. Traditional therapies have significant limitations in efficacy and safety, while T cell engager (TCE) technology provides a revolutionary solution for this field.
"Otsuka Pharmaceutical is gradually expanding its R & D pipeline in the field of autoimmune diseases through its subsidiary Visterra's antibody drug platform. Its rich experience in drug development and strong distribution network in the Asia-Pacific, European, and American markets are exactly what Harbour BioMed values. Harbour BioMed, relying on its Harbour Mice fully human antibody platform and HBICE bispecific antibody technology platform, has achieved differentiated innovation in TCE molecule design. The cooperation between the two parties not only meets the urgent needs of the global pharmaceutical market for new immunotherapies but also reflects the strategic value of technological complementarity and resource synergy," said Wang Jinsong.
As of now, Harbour BioMed has completed 17 BD overseas transactions, becoming the pharmaceutical company with the most BD overseas transactions in China.
Union Laboratories and Harbour BioMed are microcosms of the overseas practice of Chinese innovative drugs in recent years. These cases confirm an industry consensus that for both established pharmaceutical companies and local Biotechs, going global has become a necessary step for their survival and development.
"Going global means a broader market. Only by finding more partners in a vast market can a company obtain more valuable commercial returns," Li Yishi, CEO of Sinano Pharma, told Time Finance bluntly.
02 MNCs' "treasure hunting": screening and game
Chinese innovative drug assets have attracted global attention, and MNCs are involved in the frequent huge transactions.
According to the incomplete statistics of Time Finance, from 2015 to 2025, many multinational pharmaceutical companies, such as Merck & Co., Inc., Eli Lilly and Company, Roche, Pfizer, AstraZeneca, and Novo Nordisk, have become more and more active in their overseas expansion. They have actively replenished their pipelines through high-value strategic cooperation, M&A, and licensing agreements. Transactions with Chinese pharmaceutical companies have become one of their most important choices. According to DealForma data, in 2024, 31% of the innovative drugs introduced by multinational pharmaceutical companies were from China.
In BD transactions, although the choice is two-way, in the game between the seller (local pharmaceutical company) and the buyer, especially when the buyer is an MNC, the buyer with strong financial strength usually takes the leading position, while the seller is more in a state of waiting for a good price and needs to promote the cooperation with patience and in the game.
Xue Tongtong, the founder, chairman, and executive president of Yilian Biotech, once said in an exclusive interview with Time Finance that before reaching a cooperation with Roche on the next-generation ADC drug candidate YL211 targeting c-MET in early 2024, the company had gone through a year-long game and waiting with Roche before finally achieving a good result.
"In the process of cooperating with large companies, it is not easy to get everyone's approval, so the negotiation process is also relatively long," Xue Tongtong told Time Finance. "Only with the in-depth accumulation of data on our products and technology platforms and further verification at the clinical end can we prove that we are innovative, have advantages, and have the ability to implement products and achieve differentiated innovation. Only then can they gradually understand our technological concepts."
Many interviewees from pharmaceutical companies and the investment community told Time Finance that MNCs have their own set of standards and judgment criteria when it comes to buying pipelines and projects.
Liu Ling (a pseudonym), a relevant person in charge of an MNC's Asia-Pacific region, revealed during a forum this year that in terms of BD selection, the BD team focuses on the disease spectrum related to the company's pipeline. The team pays attention to products from the PCC (Preclinical candidate compounds) to the listing stage. The focus of attention and selection is whether the product is innovative and has distinctiveness.
According to the sorting out by Time Finance, generally speaking, in BD transactions, MNCs as buyers usually screen pipelines based on globally highly concerned disease areas and set up cooperation managers in China or the Asia-Pacific region to connect with interested companies. The complexity lies in that the transaction process needs to go through multiple rounds of screening and matching. Any mismatch in any link may lead to the termination of the transaction.
"In the early stage, we have a fixed person in charge for each disease. If it meets our intention, the relevant BD personnel will conduct a preliminary evaluation. If it conforms to the company's strategy, it will be promoted and handed over to the fixed person in charge for multiple rounds of communication and exchanges to judge whether it meets the company's strategy, including the matching degree with the disease spectrum and the R & D pipeline. If it meets the conditions, after signing a confidentiality agreement (CDA), in-depth communication and Q&A will be carried out," Liu Ling told Time Finance. At the beginning of the transaction, both parties need to share sensitive information such as unpublished R & D data, clinical trial results, patent information, and business plans. The CDA ensures that this information is not leaked or used for non-cooperative purposes.
Liu Ling further explained that after all these conditions are met, the subsequent BD process will follow. "Many times, BD is a continuously updated process. If there is no immediate transaction, it doesn't mean it's closed. Maybe they just want to continuously follow up on the updated data and choose the right stage to officially enter the BD negotiation stage." She believes that if the product has sufficient differentiation at the right time, communication should be carried out as early as possible.
Many relevant persons in charge of MNCs' BD in China told Time Finance that each MNC has its own structure and thinking, and the resource and regulation models in different regions vary. The BD transaction processes are generally similar, but the time required to advance the process depends on the matching degree of both parties in terms of data, product pipelines, and prices.
Xu Yun (a pseudonym), a relevant person in charge of an MNC, said during a forum this year that "we will conduct a more detailed due diligence before signing the CDA. Once the CDA is signed, it means that we are very interested in this project. Generally speaking, if we have the data we need, the progress of this project will be very fast, and it is expected to be completed in about two months. However, most projects lack data, so we need verification and supplementation, especially clinical verification, which is very time-consuming and can take up to one to two years. As long as the data is in place in the end and the product landscape remains unchanged, the contract will be signed."
This process is a great test of the patience and perseverance of the seller, that is, Chinese pharmaceutical companies. "Patience is required for cross - border transactions. Many times, they need to see the value of the pipeline more clearly and have further clinical data to support it before they can proceed. The transaction is actually determined by multiple factors such as clinical data, market foresight, and the degree of alignment with the company's internal strategy. Both parties in the BD need to have good interaction to know what they want, what they don't want, where the sticking points are, and how to solve them," Wang Yueyue, managing partner of Tianchao Capital, pointed out to Time Finance.
03 How to value innovative drugs?
The screening and layout of Chinese innovative drug assets by MNCs are essentially a global resource allocation based on "value judgment", with the core being to find the most cost - effective innovative assets. The valuation of innovative drugs is the key yardstick in this "treasure hunt". The consensus on the value of the pipeline between the two parties directly determines the investment scale of MNCs and the returns that Chinese pharmaceutical companies can obtain through BD transactions.
Therefore, when the two parties sit at the negotiation table, "how to calculate the money" becomes the most core proposition. MNCs need to evaluate the potential value of the pipeline to determine a reasonable offer, while local innovative pharmaceutical companies need to judge whether the transaction can cover R & D costs and support subsequent development through valuation calculations. Behind this is a complete valuation logic from clinical value to commercial potential.
A research report released by Guosheng Securities in June this year shows that assuming the peak domestic sales of a domestic drug are 1 billion yuan, the domestic valuation is 4 billion yuan (4XPS). After successfully going global, considering the overseas commercial insurance payment ability and sales environment, the overseas sales are expected to reach $2 billion. Calculated at a 10% profit share, the profit is $200 million, which is 1.4 billion yuan. With a 20XPE, the valuation is 28 billion yuan. After a 20% risk discount at the successful BD stage, the valuation is 5.6 billion yuan.
"After the first phase III trial starts, the valuation is 14 billion yuan. The remaining 50% of the valuation will follow the product launch and commercialization application. Currently, the market value of many domestic innovative pharmaceutical companies after BD is basically in the first valuation stage of 4 - 9.6 billion yuan, and there is still much room for growth. If the BD is successful, the valuation is about 9.6 billion yuan; it is 18 billion yuan when the first phase III trial starts; and it may reach 32 billion yuan after the product is launched," the above - mentioned research report said.
These data point to whether the product is good, whether it can meet the needs of both parties in the BD transaction, and whether it can bring benefits to innovative pharmaceutical companies and achieve the ultimate commercial value.
Xiao Jun (a pseudonym), an investor in the pharmaceutical industry, pointed out at a forum that "we participated in the last round of pre - IPO financing of an ADC company in Chengdu. The valuation was about 9 billion yuan at that time, and now it has risen to over 60 billion yuan. This happened within two years. This company has not only raised hundreds of millions of dollars in financing but also conducted a secondary offering. We have completed the reduction of most of our stocks with several times the return. This is a good example of overseas cooperation and also reflects the change in its valuation due to the progress of the product pipeline."
In other words, a good product is the foundation. Zhang Yanrong, the CFO of Kang诺亚, told Time Finance that for an enterprise, it hopes that the product can benefit patients and bring returns to the enterprise. In his opinion, if a product wants to realize its commercial value in the overseas market, it is necessary to clarify how to define a "good product" from the project - initiation stage and how to make this product succeed in the end.
A good product means having outstanding clinical data. "In my opinion, the large patient population in China, the efficient and low - cost early - stage clinical advancement, and the rapid engineering optimization ability of known - target product molecules have been recognized by overseas buyers. More and more overseas players also hope to expand the market through different forms of cooperation. We look forward to more original products entering the international stage in the future and obtaining higher pricing power through underlying innovation and differentiated clinical data," Xiao Su, the CTO of NewFocus Biotech, told Time Finance.
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The value of a "good product" is realized through a License - out agreement. Behind this is the repeated tug - of - war over every percentage point of the discount rate in the valuation model and every clause on the negotiation table. When the huge price difference between 4 billion yuan and 32 billion yuan is broken down into "risk discounts", "milestone shares", and "supply obligations", the numbers are no longer just assumptions in the CFO's model but the focus of careful consideration and weighing of pros and cons by lawyers and investors when assisting enterprises in the game.
Therefore, after the scientific judgment of "whether the product is good enough", the transaction enters the second battlefield - how to transform "good" into legal language and investment skills that are "executable, withdrawable, and divisible", and finally accurately lock in the BD that meets the interests of all parties and promote its implementation.
Gu Yang, taking the transaction between Novo Nordisk and Union Laboratories he participated in as an example, pointed out that a cross - border License - out project involves legal issues in multiple jurisdictions and multiple professional fields. In this transaction, they provided comprehensive and multi - level legal support from multiple fields such as life science and healthcare transactions and negotiations, compliance, taxation, anti - monopoly, intellectual property, and data compliance to fully protect the interests of the client.
"There are many matters that need to be agreed upon in an overseas licensing project, including the scope of the license, financial terms, intellectual property arrangements, data sharing arrangements, supply requirements, etc. Each item requires in - depth discussion and negotiation," Gu Yang told Time Finance. "As legal advisors, in License - out projects, we need to remind clients of the possible benefits they can obtain, the possible work obligations they may undertake, and the current arrangements of both parties, propose feasible solutions, and assist clients in negotiations and the game. We should not only strive to promote cooperation between the two parties but also ensure that the interests of both parties are satisfied and balanced."
04 The next step of going global
As the international competitiveness of domestic innovative drugs continues to improve, the journey of Chinese pharmaceutical companies going global will inevitably evolve from completing transactions to competing for more话语权. This evolution is not only reflected in the continuously rising transaction amounts but also in the iteration of going - global models and the depth of global layout.
Lu Likang, the director of CIC Consulting, told Time Finance that the going - global of Chinese innovative drugs has gone through two stages. It started in 2010. In the first stage from 2010 - 2019, the number of overseas projects of Chinese pharmaceutical companies was less than 20, and most products were concentrated in the oncology field. The internationalization trend had not yet formed. The second stage began in 2020. In this year, the number of overseas projects of Chinese pharmaceutical companies increased significantly, with the number of innovative drug overseas projects increasing to 12, and it continued to grow rapidly for three consecutive years, reaching 25 in 2022.
The going - global models of Chinese pharmaceutical companies are also constantly iterating and upgrading, showing a diversified development trend, evolving from the earliest export to borrowing a boat to go global, NewCo, spin - off subsidiaries, M&A to go global, independent going global, and platform - based going global.
With the diversified evolution of going - global models, industry competition has also entered a deeper level of competition.
From the perspective of investors, Li Jia'an, a partner at Jiangyuan Investment, said in an exclusive interview with Time Finance that "the trend of going global is obvious. The important thing is how we accurately select the BD and NewCo projects we want to participate in. For the invested companies, we will also suggest how to accurately and efficiently find overseas partners. Starting from the supply and demand sides, on the supply side, we can see that there are a continuous stream of projects. Chinese innovative pharmaceutical companies are competing both domestically and overseas. We can see a large number of projects in progress. However, from our investment perspective, our energy and resources are limited. We need to use our limited energy to find the most accurate and good projects."
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So, what are the criteria for accurate screening?
Li Jia'an explained to Time Finance that "on the demand side, the general direction is to understand what MNCs really need. Whether it is BD or NewCo, in essence, it is still based on the needs of MNCs because many large MNCs are unlikely to start R & D from scratch. They have needs. Secondly, whether there is a matching management team with BD experience to continuously promote the pipeline or NewCo project. Finally, we need to observe which tracks and sub - tracks are popular. In addition to the oncology track, autoimmune and metabolic fields are also very popular at present, including the weight - loss direction around new mechanisms and dual/multi - target drugs. We will also pay attention to fields such as ophthalmology and nephrology, where MNCs have clear needs but the supply of high - quality global assets is relatively limited."
Novo Nordisk told Time Finance that it is committed to providing improved treatment options for patients with obesity, type 2 diabetes, and other cardiovascular and metabolic diseases through internal and external innovation. The licensing agreement with Union Laboratories is closely related to its business development strategy and obesity and diabetes strategies. "We hope to develop a series of differentiated treatment options in the field of cardiovascular and metabolic diseases. Adding a candidate drug targeting glucagon, GLP - 1, and GIP will add important selectivity to our clinical pipeline," Novo Nordisk said.
Xu Yun told Time Finance that "a large number of new projects come in every day. We only select the key fields and projects we focus on, and ignore the rest. However, as the Chinese innovative drug ecosystem becomes stronger, our attention to the Chinese market is also increasing. We also plan to assign a person in each disease area we cover to follow up and communicate."
Domestic pharmaceutical companies are also becoming more active in seeking and competing for more话语权 in the process of going global. In this context, when the legal framework and capital logic are in place, the key to whether the transaction can finally be implemented lies in the enterprise itself, that is, whether the screening criteria can be transformed into a verifiable implementation plan. Among them, a clear indication advancement path, quantifiable phased milestones, and an implementation team that can efficiently connect with MNCs are all indispensable.
Wang Jinsong told Time Finance that from the perspective of the enterprise, he is more concerned about whether going global in the future can cover more disease areas, continuously iterate technology and molecules, and how to achieve in - depth cooperation with global MNCs. He pointed out that on the one hand, they will continue to focus on the two core disease areas of immune diseases and oncology. In addition, they will also explore more new fields, such as neurodegenerative diseases and metabolic diseases.
"Going global is one of the core strategic directions of Harbour BioMed. In the future, our going - global plan will be carried out around the three dimensions of 'more comprehensive, more innovative, and more in - depth'," Wang Jinsong said.
The global strategic cooperation with AstraZeneca is an exploration by Harbour BioMed of in - depth cooperation with MNCs. This cooperation includes not only a multi - project licensing agreement (up to 10 years) in multiple therapeutic fields based on the Harbour Mice fully human antibody technology platform but also an equity investment of $105 million by AstraZeneca in Harbour BioMed. In addition, the two parties will jointly build an innovation center in Beijing.
"In the future, as Harbour BioMed's global ecosystem becomes more extensive and mature, and more and more top - notch global institutions cooperate with us, we believe that more similar in - depth cooperation models will emerge," Wang Jinsong told Time Finance.
Many interviewees from enterprises told Time Finance that from the perspective of Biotechs, the development of Chinese innovative drugs is constantly changing. The addition of models such as technology licensing, pipeline licensing, and NewCo is a key leap for enterprises from "burning money to survive" to "profit growth". "Chinese innovative drugs are undergoing new changes. 'Globalization, differentiation, and sustainability' will coexist with the second half of Chinese innovative drugs, and further move from follow - up innovation (Me - too, Fast - follow) to original innovation (First - in - class/Best - in - class)."
This article is from the WeChat public account "Time Finance APP". Author: Zhang Yuqi. Republished with permission.
