Last week, medical service II fell by 5.70%, the largest decline
Last week, pharmaceutical biology closed at 11036.16 points, up 0.53%, ranking 10th in Shenwan industry, with a medium increase. CSI 300 fell 3.99%, and medicine outperformed CSI 300 index by 0.42%; Medical service II closed at 11327.85 points, down 5.70%; Traditional Chinese Medicine II closed at 8264.71, up 9.41%; Chemical pharmaceuticals closed at 11847.73 points, up 2.38%; Biological products II closed at 12464.73 points, down 2.30%; Pharmaceutical Business II closed at 5985.89 points, up 0.16%; Medical device II closed at 9654.68 points, up 1.48%; In terms of the rise and fall characteristics, traditional Chinese medicine and chemical pharmacy performed strongly, and the medical service sector fell greatly.
From the performance of Companies in the medical service sector, The top performing companies are: Innovation Medical Management Co.Ltd(002173) (+ 14.62%), digital people (+ 14.54%), Nanhua Bio-Medicineco.Ltd(000504) (+ 11.21%), Yihua Healthcare Co.Ltd(000150) (+ 2.82%), Xinjiang Bai Hua Cun Pharma Tech Co.Ltd(600721) (+ 1.74%); the bottom performing companies are: Pharmaron Beijing Co.Ltd(300759) (- 10.50%), Wuxi Apptec Co.Ltd(603259) (- 10.23%), Shanghai Medicilon Inc(688202) (- 10.09%), Hangzhou Tigermed Consulting Co.Ltd(300347) (- 8.38%), Inkon Life Technology Co.Ltd(300143) (- 7.59%). In terms of rise and fall characteristics, due to the change of market style, cro / cdmo related companies in the medical service sector ranked the top in terms of decline.
PE (TTM) of medical services decreased by 3.77 and Pb (LF) decreased by 0.48 month on month
At present, the PE of medical service sector is 66.18, the maximum value of PE in recent year is 185.47, and the minimum value is 66.47; The current Pb is 8.42, the maximum value of Pb in recent years is 14.47, and the minimum value is 8.42. PE in the medical service sector decreased by 3.77 month on month, Pb decreased by 0.48 month on month, and PE and Pb in the medical service sector were at the bottom level in recent one year. The premium rate of the medical service sector relative to the CSI 300 valuation was 487.62%. Although the valuation of the medical service sector is still high statically, considering the high performance growth of specialized hospitals and CXO industry related companies, good industry development trend and policy immunity, the current valuation is more reasonable.
Important information
(1) Clinical trials emphasize the safety of subjects, traditional Chinese medicine injection and cell therapy are the key points of verification
On December 20, The national drug review and inspection center has published five documents, including the working procedure for drug registration verification (for Trial Implementation). At the same time, the national drug review and inspection center has also published the starting working procedure for drug registration verification and inspection (for Trial Implementation). The above series of documents will be implemented from January 1, 2022. According to the verification and inspection According to the statement in the document, the drug Audit Center will decide whether to start drug registration verification and registration inspection based on the risk level, and divide the risk into three levels: high, medium and low from the two dimensions of “variety” and “compliance of R & D and production entities”. Among them, chemical innovative drugs, traditional Chinese medicine innovative drugs, traditional Chinese medicine injections and biological products belong to high risks, and vaccines and blood products involving major changes in production processes or production sites, as well as cell therapy products also belong to high-risk situations considered in drug registration verification. Medium risk situations mainly include complex dosage forms such as liposomes, microspheres and inhaled preparations, special chemicals, traditional Chinese medicine and ethnic medicine containing toxic herbs in the prescription, and other special varieties. In addition to the above high and medium risk situations, other situations are low risk. In addition to the verification and inspection work by distinguishing risk levels, the above documents also particularly emphasize the detailed rules for on-site verification of drug clinical trials.
This week’s view
“Strategic layout” to “beach landing”. Although the medical reform has achieved phased results over the past decade, it can be seen that the current expenditure growth rate of medical insurance funds is greater than the income growth rate, and the pressure is still great. Under the normalization of volume procurement, the future payment structure of medical insurance funds will be further adjusted: compress the part of falsely high drug prices and transfer to clinical urgently needed drugs and medical services, so as to maximize the use efficiency of medical insurance funds. At present, we propose that the innovation Shenzhen New Industries Biomedical Engineering Co.Ltd(300832) chain has changed from “strategic layout” to “beach landing”. The so-called “strategic layout” means that after the clinical self-examination and verification on July 22, 2015, China Meheco Group Co.Ltd(600056) R & D investment continued to increase, and the number of approved innovative drugs continued to increase. The so-called “beach landing” means that the flower fist embroidered leg style relies on the target to follow, and the innovative layout of the net will be difficult to sustain in the future. “Beach landing” depends on “real innovation”.
Problems brought by “strategic layout”: after six years of rough and crazy R & D investment and variety layout, Chinese innovative drugs have achieved results, but there are also many problems, such as over concentration of targets, homogenization of clinical trials and so on.
Policy signal: on November 19, CDE issued the guiding principles for clinical research and development of anti-tumor drugs guided by clinical value, which further clarified the contents of the “solicitation of opinions”, At the same time, it also made a series of responses to some main problems revealed in the annual report on the current situation of clinical trials of new drug registration in China (2020) released by CDE on November 10, such as the explosive clinical trials of innovative drugs falling into homogenization, the efficiency of delayed clinical trials, the low proportion of clinical trials of children’s drugs, the uneven geographical distribution of clinical trials, etc.
“Beach landing” puts forward higher requirements for innovation and highlights the value of CXO: the market is worried that the above clinical guiding principles and the actual internal volume will slow down the R & D investment of pharmaceutical enterprises, which will have an impact on the Shenzhen New Industries Biomedical Engineering Co.Ltd(300832) chain CXO company. We believe that the fundamental purpose of the above guiding principles is to promote China Meheco Group Co.Ltd(600056) R & D from pseudo innovation to real innovation. In terms of the impact of CXO related companies in the medical service sector, we believe that increasing the difficulty of innovation will not dampen the enthusiasm of pharmaceutical enterprises for innovation and R & D. It is an indisputable fact that the life cycle of generic drugs has become shorter and the normalization of volume procurement has become an indisputable fact. It is only that higher requirements have been put forward for pharmaceutical enterprises’ innovation in the future. At this time, it can better highlight the value of CXO leading companies to pharmaceutical innovation. In the past, the strategy of target following has tended to fail. Only the innovation at the source is the real innovation. CXO enterprises such as Wuxi Apptec Co.Ltd(603259) , Pharmaron Beijing Co.Ltd(300759) continue to track and accumulate cutting-edge technologies in new drug R & D, and their innovation ability is stronger than that of most preparation enterprises. The so-called “beach landing” is the time for enterprises to fight hard. It will be more and more difficult to follow the strategy by relying on simple and non innovative targets.
Under the background of medical insurance continuing to “change cages for birds”, adhere to the stock selection ideas of “policy immunization” and “innovation”. Suggestions: (1) innovative drug seller “CXO” Industrial chain company: the continuous improvement of global pharmaceutical R & D investment and R & D outsourcing penetration makes the CXO market scale maintain a high growth rate; Due to its human resource cost advantage and innovation ability, China CXO company will continue to benefit from the general trend of overseas production capacity transfer to China. At the same time, China’s new medical reform and good pharmaceutical venture capital and financing environment make pharmaceutical R & D in full swing; (2) Private specialized medical service companies: with the growth of disposable income and the improvement of health awareness, the medical market has gradually transformed from a disease driven market (i.e. treating the sick) to a health driven market (i.e. providing medical services and actively improving the quality of life), consumer medical care shows an upward trend. The state continues to encourage social capital to run hospitals, and private specialized hospitals are small under policy repression; (3) Third party medical laboratory: the aging, the enhancement of health awareness and the surge of chronic disease cases urge people to find and take active preventive measures as soon as possible. It is expected that with the continuous improvement of testing demand and ICL penetration, the scale of China’s ICL industry will continue to maintain steady growth.
Risk statement
(1) Uncertainty of policy changes; (2) the R & D investment of innovative drugs is less than expected; (3) the performance of the industry and listed companies is less than expected risk.
