Market review and Industry Valuation
Pharmaceutical biology fell 3.94%, underperforming the CSI 300 index by 1.55 percentage points and ranking 25 among the 31 Shenwan sub banks. Most of the pharmaceutical sub sectors fell, with offline pharmacies rising the most, up 1.60%, and medical outsourcing services falling the most, down 11.55%. As of January 10, 2022, the PE (TTM) of Shenwan pharmaceutical industry is 33.69 times, and the latest premium rate relative to Shanghai and Shenzhen 300 is 144%. The valuation of TCM hospitals in the sub sector is the highest, 85.56 times, and the valuation of medical consumables is the lowest, 13.87 times.
Industry highlights
Medical insurance, price, bidding procurement and other information were fully disclosed
Central Commission for Discipline Inspection “roll call” medical corruption
The Sixth Batch of national insulin collection will be implemented in May
The national inter provincial joint procurement of traditional Chinese medicine (materials) was launched
Progress of New Coronavirus pneumonia
As of January 9, 2022, there are 103776 confirmed cases in China (excluding Hong Kong, Macao and Taiwan), 3404 confirmed cases, 4636 dead cases, 95736 cured and discharged cases, and 11688 confirmed cases imported from abroad. In terms of covid-19 vaccination, as of January 8, 2022, China had received 2.894 billion doses of covid-19 virus vaccine.
As of January 8, 2021, there were 305 million confirmed cases in the world. The country with the largest number of confirmed cases was the United States, with a total of 61.26 million, followed by India and Brazil, with 35.53 million and 22.52 million confirmed respectively. In terms of covid-19 vaccination, as of January 8, 2021, 94.27 doses of covid-19 vaccine had been vaccinated worldwide, and the vaccination proportion (number of complete vaccinations / total population) was 49.98%.
Core view
The overall development trend of the industry is improving, and innovation is the eternal theme. On the one hand, the normalization of volume procurement continues to accelerate industry differentiation, forcing enterprises to transform to innovation; On the other hand, the medical insurance catalogue was dynamically adjusted to continuously accelerate the volume of innovative drugs. Driven by policies, talents and capital, China’s innovative drugs have entered the harvest period of achievements and opened the road of Internationalization: (1) at present, China’s innovative drug R & D is more homogeneous, with more concentrated targets and indications. The industry has gradually transformed and upgraded from me too / me worth to higher quality and more innovative me better and first in class, with 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. It is suggested to pay attention to Jiangsu Hengrui Medicine Co.Ltd(600276) , Shanghai Fosun Pharmaceutical (Group) Co.Ltd(600196) , etc; (2) With the progress of science and technology, new medical discoveries, new technologies and new fields are emerging, and biological emerging markets such as cell and gene therapy are developing rapidly. It is suggested to pay attention to industrial development trends, high-quality enterprises and upstream industrial chains, such as life science services; (3) Global and Chinese innovative drug R & D is booming, and China’s CXO industry is developing rapidly. It is expected that with the promotion of policies and the continuous improvement of technical level, the industry concentration is expected to further improve. It is recommended to pay attention to industry leaders and sub leaders, such as Wuxi Apptec Co.Ltd(603259) , Porton Pharma Solutions Ltd(300363) .
Risk tips
Industry policy risk, drug safety risk, R & D risk and market competition risk.
