Cinda Securities: “Health Insurance Commercial Insurance Dual Catalogue” officially released focusing on investment opportunities in innovative drugs and related industry chains

The Zhitong Finance App learned that Cinda Securities released a research report saying that the current pharmaceutical and biological market lacks a clear main line in the short term. On December 7, the National Health Insurance Administration released the first edition of the “Health Insurance+Commercial Insurance Dual Catalogue”. The bank believes that in the short term, it may help boost investment enthusiasm for innovative drugs. At the same time, there has been a recent correction in the innovative drug sector's stock price. Combined with the rise of innovative drugs in China, the medium- and long-term logic of the rise of innovative drugs has not changed. The bank suggests focusing on investment opportunities in innovative drugs, CXO, and upstream life science industry chains in the near future. Furthermore, the bank believes that individual stocks that see improved operations and stable dividends in the short term are also worth paying attention to, and that high-end medical devices may have an inflection point.

The main views of Cinda Securities are as follows:

Market performance: The yield of the pharmaceutical biotechnology sector was -0.74% last week, and the yield of the sector was -2.02% compared to the Shanghai and Shenzhen 300. It ranked 21st in terms of rise and fall among the 31 first-level sub-industry indices. Among the six sub-sectors, the pharmaceutical business sector ranked first in weekly yield, with an increase or decrease of 5.19% (compared to the Shanghai and Shenzhen 300 yield of 3.91%); the sixth highest yield was medical services, with an increase or decrease of -1.37% (-2.65% compared to the Shanghai and Shenzhen 300 yield).

Innovative drugs: comprehensively evaluate scientific breakthroughs and forward-looking market space in the product pipeline. The bank recommended focusing on Cinda Biotech, Sansheng Pharmaceuticals, Hengrui Pharmaceuticals, Columbite, Baili Tianheng, Rongchang Biotech, Yingen Biotech, Huiyu Pharmaceuticals, Kingsley Biotech, Weilizhibo, and Lee's Pharmaceuticals.

CXO and life science upstream industry chain: ① leading CXO companies with global influence, it is recommended to focus on Pharmacovigilance, Pharmacom Allied, Kanglong Chemical, Gloria Ying, etc.; ② Clinical CRO leaders with domestic business as the main focus, it is recommended to focus on Tiger Pharmaceuticals, Prius, Norske, Sunshine, etc.; ③ Resource-based CXO represented by safety assessment and model animals. It is recommended to focus on Zhaoyan New Drug, Innox, Medicis, Biotech, etc.; ④ Follow Baipresis, Haoyuan Pharmaceutical, and Bi Pharmaceuticals, Nanotech, Opmax, Haier Biotech, Aladdin, Titan Technology, etc.

For management improvements and high dividends: ① It is recommended to pay attention to Baiyun Mountain. ② It is recommended to pay attention to Sinopharm Holdings.

High-end medical devices: ① Pharmaceutical equipment benefits from overseas pharmaceuticals entering an upward investment boom cycle. It is recommended to focus on Morimatsu International, Dongfulong, Chutian Technology, etc.; ② In-hospital recruitment recovery drives business growth, and it is recommended to focus on Lianying Healthcare, Kaitai Healthcare, Mindray Healthcare, Australian and Chinese endoscopes, Mountain Wai Mountain, etc.; ③ Domestic demand-driven consumer medical device demand is gradually being repaired. It is recommended to focus on Yuyue Medical, Kefu Healthcare, Sannuo Biotech, etc.; ④ Companies that repair overseas orders are recommended to focus on Beautiful Healthcare, Haitai Healthcare, and Remat etc.; ⑤ High-end equipment consumables market The penetration rate continues to increase. It is recommended to focus on cardiology, minimally invasive medicine, Weigao Co., Ltd., minimally invasive brain science, Elken Healthcare, Chunli Medical, etc.

Risk factors: Tariff policy changes & geopolitical risks; product sales falling short of expectations; clinical data falling short of expectations; higher than expected price reductions in collection; market competition increasing risk.