On September 2, China Medical System Holdings Ltd (0867.HK), through its subsidiary Demei Pharma, received NMPA approval for ruxolitinib phosphate cream to add a new indication for atopic dermatitis (AD). The approval covers short-term and non-continuous chronic treatment of mild-to-moderate AD in immunocompetent children aged 2 years and older, as well as adults, when other topical therapies are inadequately controlled or not recommended. The drug registration certificate was formally issued on September 3. This marks the second indication secured in China for ruxolitinib phosphate cream, following its approval for vitiligo in January this year. Why does the expansion of a topical medication's indications warrant standalone attention? Because it fills the most fundamental and crowded layer within the treatment pyramid for China's 54 million AD patients.

Let us begin with the event itself: the value of a topical JAK cream. Ruxolitinib cream is a selective JAK1/JAK2 inhibitor topical formulation developed by Incyte, marketed under the name Opzelura® in the United States and Europe. It was the first topical JAK inhibitor approved by the FDA, initially clearing for mild-to-moderate AD in 2021, followed by non-segmental vitiligo in 2022. In December 2022, Demei Pharma entered into a licensing agreement with Incyte, securing exclusive rights to develop, register, and commercialize the product across mainland China, Hong Kong, Macau, Taiwan, and eleven Southeast Asian countries. Supporting this domestic approval is a randomized, double-blind, placebo-controlled Phase III study conducted in China: at eight weeks of treatment, 63.0% of patients in the active group achieved IGA 0/1 with at least a 2-point improvement from baseline, versus 9.2% in the placebo group; the EASI-75 response rate was 78.0% compared to 15.4% for placebo, with highly significant differences across both endpoints. Adverse events were predominantly mild-to-moderate in severity, with no treatment-discontinuation events reported. The application was also granted priority review status by the CDE under the designation for pediatric drug categories, formulations, and specifications that align with children's physiological characteristics.

Notably, Demei has built a comprehensive product matrix around AD: the topical ruxolitinib phosphate cream for mild-to-moderate AD is now on the market, the injectable biologic comkibartimab for moderate-to-severe AD is under NDA review, the oral small-molecule targeted therapy CMS-D001 for moderate-to-severe AD is in Phase II clinical trials, and the Heluo soothing repair skincare line rounds out the portfolio. A company traditionally known for licensing is now transforming AD into a full-spectrum business spanning both treatment and care.

AD is a chronic, relapsing inflammatory skin disease characterized by dry skin, recurrent eczematous lesions, and intense pruritus. It is fundamentally a systemic immune condition driven by type 2 inflammation. According to CIC data, China had over 54 million AD patients in 2024, with mild-to-moderate cases accounting for approximately 98%, exceeding 52.5 million individuals. AD treatment has long operated on a "pyramid" logic: the base relies on topical therapies such as emollients, topical corticosteroids (TCS), and topical calcineurin inhibitors (TCI) like tacrolimus and pimecrolimus, which manage the majority of mild-to-moderate patients. The apex involves systemic treatments, including biologics or oral targeted agents for moderate-to-severe cases where topical options fail. The pain points at the base are clear: long-term TCS use carries risks like skin atrophy, with parents particularly wary of applying steroids to children; TCI offers limited efficacy and causes initial burning and irritation. Clinicians have long awaited a non-steroidal topical targeted therapy with robust efficacy, which is precisely the niche that ruxolitinib cream, along with roflumilast cream (a PDE4 inhibitor) and tapinarof cream (an aryl hydrocarbon receptor agonist) approved overseas in recent years, aims to occupy. The 2025 AAD guideline update has designated all four novel therapies, including tapinarof, roflumilast, lebrikizumab, and nemolizumab, as strong recommendations.

The moderate-to-severe segment, driven by systemic therapy, truly underpins the AD market's scale, and this space has undergone two rounds of transformation over the past eight years. The first round, beginning in 2017, saw biologics take center stage with dupilumab dominating. Sanofi and Regeneron's dupilumab, targeting the IL-4 receptor alpha subunit to simultaneously block both IL-4 and IL-13 pathways central to type 2 inflammation, became the world's first targeted AD biologic. It secured approval in China for adult moderate-to-severe AD in June 2020, two years ahead of schedule, and was included in the 2020 national medical insurance reimbursement list just five months after launch. Its indications have since expanded downward, covering children aged 6-11 in 2022 and infants from 6 months in 2023, making it the only AD biologic spanning the full age spectrum from infancy to adulthood. Commercially, dupilumab exceeds $10 billion in annual global sales, serving as a cash cow for both Sanofi and Regeneron.

The second round, from 2021 onward, has brought target diversification and a dense influx of new players. LEO Pharma's tralokinumab gained approval in the US and Europe in 2021, while Lilly's lebrikizumab received FDA approval in September 2024, emphasizing once-monthly maintenance dosing convenience. Nemolizumab, approved by the FDA in December 2024 for AD, precisely targets the "itch factor" IL-31 receptor, with itch relief as its differentiating feature. On the domestic front, KeyMed Bio's stapokibart (CM310) received approval in September 2024 for adult moderate-to-severe AD, becoming the first domestically developed and the world's second IL-4Rα antibody. Its Phase III trial in 500 Chinese patients showed an EASI-75 response rate of 66.9% at week 16 versus 25.8% for placebo, with long-term data at week 52 reaching 92.5% for EASI-75 and 77.1% for EASI-90, published in the top allergy and immunology journal Allergy. All three indications for stapokibart, including adult AD, chronic rhinosinusitis with nasal polyps, and seasonal allergic rhinitis, have been included in the 2025 national reimbursement list. Oral JAK inhibitors represent a parallel pathway, with AbbVie's upadacitinib and Pfizer's abrocitinib, approved in China in April 2022, offering oral convenience and rapid onset, with visible improvement within two weeks in real-world use. Hengrui Pharma's ivarmacitinib, approved in 2025, became the first domestically developed oral JAK1 inhibitor with an AD indication, and all these agents have entered China's medical insurance coverage. However, the oral JAK safety profile remains a crucial clinical consideration, with class-label warnings for serious infections, thrombosis, and cardiovascular events, positioning them as second-line options behind biologics rather than universally accessible "itch pills."

Competition in the AD arena is now unfolding across three dimensions simultaneously. The first is segment stratification. The mild-to-moderate segment, representing 98% of the patient population, is contested in dermatology outpatient clinics and retail pharmacies, where topical safety, onset speed, and pricing determine outcomes. The moderate-to-severe arena, meanwhile, is fought over by biologics and oral agents, competing on long-term efficacy data, dosing convenience, and insurance reimbursement. Topical targeted agents like ruxolitinib phosphate cream occupy the gap between "steroids that cannot be used long-term" and "systemic therapy that is overkill," with their potential deriving precisely from the vast base of the pyramid. The second dimension involves the parallel tracks of domestic substitution and licensing. On the biologics front, stapokibart has entered dupilumab's territory as the first domestic IL-4Rα entrant, with multiple IL-4Rα and IL-13 antibodies in late-stage clinical development domestically. In the small-molecule space, Hengrui's ivarmacitinib has already landed. For topicals, the China Medical System and Demei model of "licensing mature products plus rapid localization" currently holds the lead. Self-developed and licensed-in approaches are, for the first time, simultaneously viable in this chronic disease arena. The third dimension sees next-generation targets already at the doorstep. Anti-OX40 agents including amlitelimab from Sanofi and rocatinlimab from Amgen and Kyowa Kirin have both entered Phase III, while TSLP and IL-22 pathway candidates are also in development, aiming to create next-generation immunomodulatory therapies that deliver sustained remission even after treatment cessation.

Looking back, the logic behind AD drug development remains straightforward: the finer the dissection of inflammatory pathways, the more precisely drugs move from "systemic suppression" to "targeted stratification." From corticosteroids to Dupixent, from oral JAK inhibitors to topical targeted creams, the treatment options for China's 54 million AD patients are expanding at an unprecedented pace.