Core view
View of Medicine Week: the popularity of traditional Chinese medicine sector has increased and attention has been paid to new opportunities for the development of brand traditional Chinese medicine. Recently, under the catalysis of policy support and price increase, traditional Chinese medicine enterprises with low valuation and strong brand influence in the past have attracted attention. In the past two years, a number of incentive policies have been issued, the traditional Chinese medicine industry has ushered in new opportunities for development, and the operation of traditional Chinese medicine enterprises is expected to achieve marginal improvement.
The reform of the review and approval system of traditional Chinese medicine has achieved initial results. So far, a total of 11 new traditional Chinese medicine drugs have been approved this year, the largest number of new traditional Chinese medicine drugs approved in the past five years. At the same time, the centralized collection and landing of Chinese patent medicine is relatively mild. The results of centralized purchase of Chinese patent medicines in 19 provinces of Hubei Province were announced last week. A total of 157 enterprises and 182 products participated, of which 97 enterprises and 111 products were selected. The average price of selected Chinese patent medicines decreased by 42.27%, and the price reduction was relatively mild.
Brand Chinese patent medicine has both drug and consumption attributes. It has strong independent consumption and is positioned at consumption upgrading. It is basically not affected by the reduction of drug prices by medical insurance. On the contrary, due to the restriction of precious Chinese medicinal materials in recent years, the price has increased significantly. Long term optimistic about Yunnan Baiyao Group Co.Ltd(000538) (000538), Zhangzhou Pientzehuang Pharmaceutical Co.Ltd(600436) (600436), Tianjin Zhongxin Pharmaceutical Group Corporation Limited(600329) (600329), Guangyuyuan Chinese Herbal Medicine Co.Ltd(600771) (600771), etc.
Market review: the biomedical sector rose 0.53% last week, ranking 10th in weekly rise and decline. Since the beginning of this year, pharmaceutical biology has fallen by 8.62%, 3.06 percentage points lower than Shanghai and Shenzhen 300 index, ranking 24th in all SW primary industries.
In terms of subdivided industries, the pharmaceutical and biological subdivided sectors rose more or less last week, traditional Chinese medicine rose the most, up 9.41%, and medical services fell the most, down 5.7%. Since the beginning of this year, the performance of chemical raw materials and traditional Chinese medicine has been the best, up 28.81% and 27.11% respectively since the beginning of the year; Chemical agents were the weakest performing sub industry, down 23.49%. Pharmaceutical business (- 23.49%), pharmaceutical business (- 22.30%), biological products (- 16.20%), medical services (- 12.19%) and medical devices (- 10.10%) underperformed the pharmaceutical and biological (SW) industry index.
From the performance of individual stocks, the top five stocks that rose last week were: Gansu Longshenrongfa Pharmaceutical Industry Co.Ltd(300534) (91.53%), Kunming Longjin Pharmaceutical Co.Ltd(002750) (36.89%), Andon Health Co.Ltd(002432) (35.06%), Guiyang Xintian Pharmaceutical Co.Ltd(002873) (34.82%) and Fujian Cosunter Pharmaceutical Co.Ltd(300436) (27.85%). The top five stocks that fell were: * ST Kangmei (- 22.70%), Suzhou Nanomicro Technology Co.Ltd(688690) (- 13.65%), Shuyu Civilian Pharmacy Corp.Ltd(301017) (- 13.48%), Shanghai Haohai Biological Technology Co.Ltd(688366) (- 10.73%) and Pharmaron Beijing Co.Ltd(300759) (- 10.50%).
Valuation: the valuation showed a slight upward trend. As of Friday (December 24), PE (TTM) of the whole pharmaceutical and biological (SW) industry was 33.80 times and Pb (LF) was 4.16 times
Risk warning: medical policy risk; Lower prices than expected; Systemic risk.
