Market review: this week, the Shenwan pharmaceutical and biological sector index rose by 4.9%, outperforming the CSI 300 index by 3.8%. The pharmaceutical sector ranked third in the Shenwan industry classification. The medical service sector dominated by early oversold CXO performed relatively well + 12.6%, and the rest of the sectors rose; The top five increases in medicine were Chengda Pharmaceutical (+ 85.9%), Hybio Pharmaceutical Co.Ltd(300199) (+ 40.8%), Porton Pharma Solutions Ltd(300363) (+ 36.2%), Beijing Hotgen Biotech Co.Ltd(688068) (+ 28.6%) and Shanxi C&Y Pharmaceutical Group Co.Ltd(300254) (+ 23.9%).
Industry policies and trends: 1) covid-19 vaccine sequential immunization will be carried out nationwide; 2) Information filling and reporting of the seventh batch of national centralized drug procurement: Shanghai Sunshine procurement network announced that the seventh batch of centralized drug procurement was officially started, with a total of 56 varieties and 208 product specifications. 3) CDE released the technical guidelines for clinical trials of New Coronavirus pneumonia new drugs: trial guidelines: guidelines for the design of clinical trial plans and issues that need to be focused on, to promote the development of New Coronavirus pneumonia antiviral drugs and standardize the design of clinical trials, and to further enhance the importance of COVID-19 drug research and development.
Sequential immunization was approved, with emphasis on the recommended vaccine sector: on February 19, at a press conference held by the joint prevention and control mechanism of the State Council, with the approval of the joint prevention and control mechanism of the State Council, the National Health Commission said it would begin to deploy sequential immunization. Previously, the target population over 18 years old who has been vaccinated with inactivated vaccine of Sinopharm Beijing Institute, Beijing Kexing Institute and Sinopharm Wuhan Institute or adenovirus vector vaccine of Tianjin Cansino Biologics Inc(688185) company for 6 months can receive one dose of primary homologous booster immunization. At the same time, the state announced that after completing the whole process of vaccination of the above three inactivated vaccines, the target population can also choose the recombinant protein vaccine of zhifeilong KOMA or the adenovirus vector vaccine of Cansino Biologics Inc(688185) for sequential immunization. We believe that it is beneficial to the targets of covid-19 vaccine that can be sequentially strengthened in China. It is suggested to focus on Chongqing Zhifei Biological Products Co.Ltd(300122) and Cansino Biologics Inc(688185) .
Investment strategy: covid-19 epidemic has occurred in many places in China. Among them, the epidemic in Hong Kong is more serious, and the situation of epidemic prevention and control in China is still tense. The relevant sectors of epidemic prevention and control will become the main investment strategy for the pharmaceutical sector in the medium and long term. In the field of basic immune barrier, the sequential vaccination scheme of covid-19 vaccine was introduced recently. The recombinant protein of Chongqing Zhifei Biological Products Co.Ltd(300122) and kangxinuo adenovirus vaccine have become the sequential vaccination varieties in China; In the field of covid-19 therapeutic drugs, we continue to pay attention to Pfizer small molecule drug industry chain and domestic small molecule related targets, as well as anti covid-19 traditional Chinese medicine. We believe that the relevant sectors focusing on covid-19 epidemic prevention and control will become one of the main investment sectors in the post epidemic era: 1) covid-19 sequential vaccination scheme: only Chongqing Zhifei Biological Products Co.Ltd(300122) and kangxinuo products can be vaccinated sequentially, or contribute significantly to the volume of income and profit. 2) Covid-19 therapeutic drugs of “integration of Chinese and Western medicine” are expected to reach a new market of 100 billion level: Pfizer covid-19 specific drug paxlovid has been urgently approved in China, the opening of the country is expected to be ahead of schedule, and covid-19 therapeutic drug market is expected to reach 100 billion level. It is the most important investment sector after covid-19 vaccine and covid-19 testing, and its sustainability is far beyond that of vaccine and testing, “Integration of Chinese and Western medicine” will be the mainstream method of covid-19 treatment in China, focusing on covid-19 small molecules and industrial chain + anti covid-19 traditional Chinese medicine, focusing on: Porton Pharma Solutions Ltd(300363) , Shanghai Junshi Biosciences Co.Ltd(688180) , Shijiazhuang Yiling Pharmaceutical Co.Ltd(002603) , Shandong Buchang Pharmaceuticals Co.Ltd(603858) ; 3) CXO industry is expected to continue to rebound: the fundamental outlook of the sector remains unchanged. Under the strong demand for covid-19 small molecule intermediates and API, the oversold rebound of the sector is expected to continue. Recommended focus: Wuxi Apptec Co.Ltd(603259) , Yaoming biology, Asymchem Laboratories (Tianjin) Co.Ltd(002821) , Porton Pharma Solutions Ltd(300363) , Pharmaron Beijing Co.Ltd(300759) etc; 4) Continue to be optimistic about the traditional Chinese medicine sector: the market of the traditional Chinese medicine sector has gradually warmed up, and the sharp decline before the festival gives the opportunity to re layout. The boom market is expected to run through 2022. We believe that traditional Chinese medicine has risen to a national strategic height. As an effective carrier of national culture and soft power, the state legislates separately for the inheritance and innovation of traditional Chinese medicine. All departments, especially the medical insurance bureau, also issue separate documents to support from the payment side. The support for traditional Chinese medicine will be reflected in the growth rate of the company’s income and profit. Undervalued value + strong policy support is an important basis for the continuous improvement of the market of traditional Chinese medicine in the future. It focuses on the innovation of traditional Chinese medicine, brand OTC, formula particles, anti covid-19 traditional Chinese medicine and other related targets: Shijiazhuang Yiling Pharmaceutical Co.Ltd(002603) , Shandong Buchang Pharmaceuticals Co.Ltd(603858) , Chongqing Taiji Industry (Group) Co.Ltd(600129) , Chinese traditional medicine, Beijing Tongrentang Co.Ltd(600085) , China Resources Sanjiu Medical & Pharmaceutical Co.Ltd(000999) , Tianjin Chase Sun Pharmaceutical Co.Ltd(300026) , Guiyang Xintian Pharmaceutical Co.Ltd(002873) .
Portfolio this week: it is recommended to focus on Chongqing Zhifei Biological Products Co.Ltd(300122) , kangxinuo, Shijiazhuang Yiling Pharmaceutical Co.Ltd(002603) , Porton Pharma Solutions Ltd(300363) , Wuxi Apptec Co.Ltd(603259) and Shanghai Junshi Biosciences Co.Ltd(688180) .
Portfolio this month: it is recommended to focus on Wuxi Apptec Co.Ltd(603259) , Shenzhen Mindray Bio-Medical Electronics Co.Ltd(300760) , Hunan Jiudian Pharmaceutical Co.Ltd(300705) , Jiangsu Yuyue Medical Equipment And Supply Co.Ltd(002223) , Shanghai Kindly Enterprises Development Group Co.Ltd(603987) and Chongqing Zhifei Biological Products Co.Ltd(300122) .
Risk tip: the industry demand is less than expected; The performance of listed companies is less than expected; Market competition intensifies risks.
