Tariff Announcement: US President Donald Trump will impose a 100% tariff on imported branded or patented finished drugs starting in October, unless manufacturers establish production facilities in the US; generic drugs and certain intermediates will be exempt.

Impact on Chinese Drug Companies: The tariff's effect on China's innovative drug sector is expected to be minimal, as few companies export directly to the US, with many having production capabilities in the US or using local contract manufacturers.

Trump Administration's Drug Policy Discussion: Goldman Sachs reported that the Trump administration is considering restrictions on Chinese pharmaceuticals and drafting an executive order to limit the entry of innovative Chinese drugs into the US market, although a White House spokesperson stated that the government is not actively pursuing this draft at the moment.

Impact on Chinese Biotech Sector: Goldman Sachs believes that potential restrictions could create "headline risks" for the Chinese biotech and pharmaceutical sector, leading to increased stock price volatility, especially as major US pharmaceutical companies lobby against the proposed order.

Categorization of Chinese Biotech Companies: The report categorizes Chinese biotech firms into three groups based on their global presence and partnerships, with varying levels of expected impact from the potential restrictions.

Market Reactions and Short Selling Data: The article includes specific stock performance and short selling data for various companies within the categorized groups, indicating market sentiment and potential risks associated with the evolving regulatory landscape.

Stock Recommendations for August: BOCOM International has recommended several stocks for August, including PING AN, LINK REIT, OMNIVISION, BABA-W, XPENG-W, ANTENGENE-B, ANTA SPORTS, and GCL TECH, all rated as 'Buy' with specified target prices.

Market Insights: The report highlights short selling data for each stock, indicating varying levels of investor sentiment, with significant short selling observed in PING AN, BABA-W, and XPENG-W.