Weekly market review (202203.28202204.1): this week, the pharmaceutical sector fell 1.91%, 3.76 percentage points lower than the Shanghai and Shenzhen 300 index, and the PE (TTM) of the pharmaceutical sector was about 29 times. The 14th five year plan of traditional Chinese medicine has been implemented recently. This week, we will continue to discuss the current situation and development prospects of the industry under the favorable policies.
The whole process of registration and approval of traditional Chinese medicine has been reformed to help the inheritance and innovation of traditional Chinese medicine. The registration and classification of traditional Chinese medicine has been significantly reformed, and the classification is more concise, which fully adapts to the law of traditional Chinese medicine research and development. The “Three Combinations” evaluation system promotes the scientific implementation of clinical evidence of traditional Chinese medicine. Compared with chemical drugs, the term of intellectual property protection of traditional Chinese medicine may be longer, which is conducive to increasing the moat of enterprises.
Traditional Chinese medicine innovative drugs are full of vitality, and the industry has ushered in the spring of development. In 2021, the declared quantity of traditional Chinese medicine was 1371 (+ 190%), reaching the peak of the declared quantity of traditional Chinese medicine in recent 6 years; 12 new traditional Chinese medicine drugs were approved for listing, and the number of approvals reached a new high. The standardization of R & D path of traditional Chinese medicine is beneficial to traditional Chinese medicine enterprises with strong R & D strength and early pipeline layout.
Cro enterprises are expected to benefit from the opening of the wave of traditional Chinese medicine R & D. The cro service content of traditional Chinese medicine is unique, such as the processing and dose calibration of classic famous prescriptions, the evaluation and traceability of traditional Chinese medicine resources, patent protection, etc. we need to deeply understand the compatibility law of traditional Chinese medicine. Cro of traditional Chinese medicine developed slowly in the past and is expected to benefit from the development wave of innovative traditional Chinese medicine in the future.
Taking Japanese Hanfang industry as a mirror, the rise and fall of Chinese traditional medicine industry. Japan’s Chinese market is booming, and the aging population has become the basis for the prosperity of modern Japanese Chinese industry. Medical insurance support + high-quality standards have promoted the development of Japanese Chinese for decades. Referring to the Japanese Chinese market, the standardization of traditional Chinese medicine is expected to promote the rapid development of the industry.
Recommended portfolio of stocks this week: 1) Growth Portfolio: Pharmablock Sciences (Nanjing) Inc(300725) , kingship biotechnology, Focused Photonics (Hangzhou) Inc(300203) ; 2) Steady combination: gushengtang, Baicheng medicine, China Resources Sanjiu Medical & Pharmaceutical Co.Ltd(000999) ; 3) Elastic combination: Shijiazhuang Yiling Pharmaceutical Co.Ltd(002603) , Zhejiang Jolly Pharmaceutical Co.Ltd(300181) , Henan Lingrui Pharmaceutical Co.Ltd(600285)
Investment suggestions: 1) OTC of traditional Chinese medicine has no risk of centralized purchase and independent pricing power, focusing on two directions: first, it has exclusive varieties and confidential varieties, and it is recommended to pay attention to Beijing Tongrentang Co.Ltd(600085) , Zhangzhou Pientzehuang Pharmaceutical Co.Ltd(600436) , Jianmin Pharmaceutical Group Co.Ltd(600976) , etc; Second, it has omni-channel coverage and brand strength. It is recommended to pay attention to China Resources Sanjiu Medical & Pharmaceutical Co.Ltd(000999) , Chongqing Taiji Industry (Group) Co.Ltd(600129) , Henan Lingrui Pharmaceutical Co.Ltd(600285) , etc. 2) Traditional Chinese medicine diagnosis and treatment services are in a period of rapid growth. It is suggested to pay attention to gushengtang, the private chain leader of traditional Chinese medicine. 3) Under the trend of tracing the source of traditional Chinese medicine, enterprises providing high-quality traditional Chinese medicine Pieces / formula particles are expected to benefit. It is suggested to pay attention to Chinese traditional Chinese medicine, Tianjin Chase Sun Pharmaceutical Co.Ltd(300026) etc. 4) The competition pattern in the field of innovative traditional Chinese medicine is good, and drug research and development has entered an intensive cashing period. It is suggested to pay attention to Shijiazhuang Yiling Pharmaceutical Co.Ltd(002603) , Jiangsu Kanion Pharmaceutical Co.Ltd(600557) , Guiyang Xintian Pharmaceutical Co.Ltd(002873) , etc. 5) Traditional Chinese medicine cro has unique service content and is expected to benefit from the development wave of innovative traditional Chinese medicine in the future. It is suggested to pay attention to Baicheng medicine, Boji Medical Technology Co.Ltd(300404) , Beijing Sun-Novo Pharmaceutical Research Co.Ltd(688621) , etc.
Risk warning: policy change risk; Risk of product R & D failure; Risk of product sales falling short of expectations.
