Key investment points:
Market review:
Last week, the overall performance of A-Shares was weak. The Shanghai index fell 1.77%, the Shenzhen Component Index fell 0.95% and the gem index rose 1.81%. Except for real estate (+ 1.98%), non bank finance (+ 1.68%), medicine and Biology (+ 1.08%) and social services (+ 0.85%), all other sub industries of shenwanyi fell. Among them, steel, utilities and environmental protection led the decline. During the reporting period, the pharmaceutical and biological sector outperformed the CSI 300 index by 2.02% and underperformed the gem index by 0.74%. The sub sectors of the pharmaceutical industry were divided, among which the biological products sector led the rise, up 6.29%; The medical services sector led the decline, down 1.16%.
Industry highlights of the week:
1, ninth edition of New Coronavirus pneumonia diagnosis and treatment plan;
2. Fujian Medical Insurance Bureau issued a notice that traditional Chinese medicine formula granules were included in medical insurance;
3. Five Chinese pharmaceutical companies have obtained Pfizer covid-19 oral drug imitation authorization
Industry Week view:
This week, the National Health Protection Commission and the State Administration of traditional Chinese medicine jointly issued the New Coronavirus pneumonia diagnosis and treatment plan (trial version ninth). Compared with the previous edition, the revised content includes increased antigen detection, nucleic acid detection supplementation, light centralized isolation, and no hospitalization. Pfizer’s pf-07321332 / ritonavir tablet (paxlovid) and tengshengbo’s domestic monoclonal antibody (ambavizumab / romistimab injection) were added as diagnosis and treatment drugs, traditional Chinese medicine non drug therapy was added, and the release of isolation and discharge standards were re stipulated. We believe that under the background of repeated epidemics in China and the state attaches great importance to covid-19 from detection to isolation to treatment, the listed companies related to covid-19 pneumonia industry chain benefit, including 1) IVD industry chain (manufacturers whose antigen detection products have been approved for listing in China, manufacturers whose antigen detection products have been approved for listing abroad (it is expected that China will obtain the certificate in the future) and IVD upstream raw material enterprises) 2) Covid-19 specific drug industry chain (covid-19 specific drug R & D enterprises, covid-19 specific drug commercialization enterprises, covid-19 specific drug upstream enterprises and covid-19 specific drug R & D outsourcing enterprises) and 3) covid-19 traditional Chinese medicine industry chain related to the treatment of pneumonia. At the same time, we should also pay attention to the risks of centralized purchase and price reduction, deterioration of competition pattern, and failure of R & D progress to meet expectations.
We recommend focusing on:
In the long run, we believe that under the background of medical insurance fee control and China Meheco Group Co.Ltd(600056) industrial upgrading, the pharmaceutical sector is dominated by structural investment opportunities. It is suggested to pay attention to: 1) CXO sector is the only one in medicine that is not affected by policies and has a high landscape. At present, the core problem of CXO sector is to kill valuation, and there is no significant change in fundamentals. 2) Policy immunization + undervalued value enables the OTC segment of traditional Chinese medicine to have performance growth momentum and valuation cost performance.
Risk factors: the risk of exceeding expectations in the implementation of policies such as cost control and volume procurement, and the risk of drug R & D and listing failure.
