Market review and Industry Valuation
Pharmaceutical biology rose 0.18%, outperforming the CSI 300 index by 1.86 percentage points and ranking 10th among the 31 Shenwan sub banks. The pharmaceutical sub sector was mixed, with the largest increase in pharmaceutical circulation, up 9.12%, and the largest decrease in medical equipment, down 3.54%. As of March 4, 2022, the PE (TTM) of shenwanyi pharmaceutical industry is 31.31 times, and the latest premium rate relative to Shanghai and Shenzhen 300 is 140%. The valuation of TCM hospitals in the sub sector is the highest, 76.55 times, and the valuation of medical consumables is the lowest, 11.89 times.
Industry highlights
The first domestic car-t product was approved by FDA
Progress of New Coronavirus pneumonia
As of March 6, 2022, there are 111195 confirmed cases in China (excluding Hong Kong, Macao and Taiwan), 3837 confirmed cases, 4636 dead cases, 102722 cured and discharged cases, and 15456 confirmed cases imported from abroad. In terms of covid-19 vaccination, as of March 5, 2022, China had received 3.157 billion doses of covid-19 virus vaccine.
As of March 6, 2022, 445 million cases had been confirmed in the world. The country with the largest number of cases was the United States, with a total of 80.92 million, followed by India and Brazil, with 42.96 million and 29.05 million confirmed respectively. In terms of covid-19 vaccination, as of March 5, 2022, covid-19 vaccine had been vaccinated 10.851 billion doses worldwide, and the vaccination proportion (number of complete vaccinations / total population) was 55.88%.
Core view
In 2022, the government work report was released. The report proposed to improve the medical and health service capacity, involving the centralized collection of drugs and consumables, the guarantee of medication for rare diseases, the completion of service shortcomings such as maternal and child Pediatrics, mental health and geriatrics, the revitalization of the development of traditional Chinese medicine and other important contents. The relevant subdivided fields and high-quality companies are expected to benefit. It is recommended to pay attention to it.
The overall valuation of the industry is at a historically low level and the industrial development trend is good. We maintain the optimistic view of the industry and suggest paying attention to the following directions: (1) China Meheco Group Co.Ltd(600056) especially the rapid development of biopharmaceutical field, but there are still shortcomings in the upstream supply chains of basic links, high-end pharmaceutical equipment, life science reagents, consumables, instruments and equipment, and the main markets are occupied by foreign-funded enterprises, The “14th five year plan” for pharmaceutical industry development proposed for the first time that “comprehensively improve the modernization level of pharmaceutical industry chain, realize the stability and controllability of supply chain, and accelerate the innovation driven development transformation”. Driven by the continuous improvement of policy and technical level, China’s upstream high-tech industry chain will develop rapidly and accelerate domestic substitution. It is suggested to pay attention to relevant subdivided fields; (2) Driven by policies, talents, capital and other factors, domestic innovative drugs have developed rapidly, entered the harvest period of achievements, opened the road of internationalization and ushered in a new stage of upgrading. They have begun to gradually transform from me too / me worth to higher quality and more innovative me better and first in class. In the future, whether in the Chinese market or overseas market, they have strong R & D strength and rich pipelines, The advantages of domestic innovation leading enterprises with reasonable gradient and outstanding product differentiation advantages will be further highlighted, which is recommended to be paid attention to; (3) Global and Chinese innovative drug R & D is booming, production capacity continues to transfer to China, and China’s CXO industry is developing rapidly. It is expected that with the promotion of policies, the continuous improvement of technical level and relevant demand, the industry concentration is expected to further improve, and the head effect is becoming more and more obvious. It is suggested to pay attention to industry leaders and sub leaders, such as Porton Pharma Solutions Ltd(300363) etc.
Risk tips
Industry policy risk, drug safety risk, R & D risk and market competition risk.
