Last Friday, the net inflow exceeded 20 million yuan, and the pharmaceutical sector outperformed **206%
Funds or ongoing**pharmaceutical**. According to wind statistics, last Friday, the total net inflow of funds in the whole market pharmaceutical ETF** was 201.93 million yuan.
In the past week, the pharmaceutical and biological index** 051%, outperforming the CSI 300 index by 206 percentage points, ranking 10th in the industry. Since the beginning of 2023, the pharmaceutical industry has fallen by 249%, outperforming the CSI 300 Index by 755 percentage points, ranking 13th in the industry. And in the past week, only science and technology, medicine, and real estate have been substantial.
*In terms of net inflows, the top five main net inflows are Mindray Medical, United Imaging Medical, Berry Gene, Xingqi Ophthalmology, and Kangtai Biotech.
It is worth noting that the "6th China Health Economic Development Forum" was held in Wuhan on December 2. Professor Huang Cheng of the Institute of Global Health Development of Peking University attended and delivered a speech. Huang Cheng said that innovative drugs will be an area of rapid growth. "In the last four years, from 1$3 trillion grew to 1$5 trillion, and the market size will be as high as $2 trillion by 2027, which is growing very fast." From the perspective of investment, the investment in innovative drugs is concentrated in the field of chronic diseases, such as tumors, immunity, digestion and metabolism. In recent years, due to the influence of industrial policies and natural market competition, the concentration of leading enterprises is very high, and the scale effect of leading enterprises has gradually improved. This is undoubtedly another shot in the arm for professionals in the field of innovative drugs.
The results of innovative drugs going overseas have been intensively implemented, and the industry may enter the first period of profit realization
In the context of domestic centralized procurement and continuous negotiation of price reduction, internationalization is the only way for Chinese pharmaceutical companies to become bigger and stronger. Thanks to the friendly domestic policy support in the past decade, the relaxed financing environment, the return of technical talents to start their own businesses, and the long-term R&D accumulation of leading enterprises, China's innovative drugs are now officially entering the harvest period. Whether it is the authorization of leading pharmaceutical companies, or the listing and commercialization of drugs in the United States, they all represent the future development direction of the most competitive pharmaceutical companies in China.
In the context of continuous policy increase and pharmaceutical companies continue to increase R&D investment, domestic innovative drugs have recently ushered in a "reversal moment", with frequent good news and intensive product approval.
On December 1, Jingxin Pharmaceutical's Class 1 innovative drug Didacinil Capsule was approved for marketing, becoming the first innovative drug for insomnia in China in 15 years. By partially activating GABAA receptors, the drug has a sleep-promoting effect, providing a new choice for patients with insomnia disorders, and is expected to change the existing market pattern of sedative-hypnotic drugs.
On November 27, Henlius announced that the New Drug Investigational Drug (IND) application for HLX43 for ADC (antibody drug conjugate) developed by the company has been approved by the FDA for the treatment of advanced metastatic solid tumors based on the cooperation with Yilian Biologics. In addition, companies such as Columbotai Bio-B and Puli Pharmaceutical have announced new progress in the export of their drugs.
On November 13, Legend Biotech announced that it has entered into an exclusive global license agreement with Novartis for Legend Biotech's specific DLL3-targeting chimeric antigen receptor T cells (CAR-T)**, granting Novartis exclusive worldwide rights to develop, manufacture and commercialize these cells**. Legend Biotech will receive an upfront payment of $100 million, with additional milestone payments10$100 million, with a total transaction value of up to 11$100 million.
On October 28, toripalimab in combination with cisplatin gemcitabine jointly developed by Junshi Biosciences became the first and only drug approved for nasopharyngeal carcinoma** in the United States, and the first innovative biologic drug independently developed and produced in China approved by the FDA.
Since the beginning of this year, among the listed pharmaceutical companies, BeiGene, Hengrui Biologics, Harbour BioMharma, WuXi Biologics, Sinovi, Chi-Med, CSPC Pharmaceutical Group, Akeso Biologics, CSPC Pharmaceutical Group and other pharmaceutical companies have successfully authorized their drugs to go overseas. In addition, a number of companies have also entered the outbreak period of going overseas, and the products in the reserve are about to be approved, and commercialization is imminent.
The innovation of Chinese pharmaceutical companies is also crossing the river by feeling the stones, from the beginning of following and imitating to the current improvement, we believe that in the future, there will be companies that lead the industry's technological innovation. Globally, the U.S. is the largest market, and if Chinese pharmaceutical and device companies want to continue to grow in the future, the U.S., Europe, and Japan markets are a must to compete. Unswerving internationalization, on the one hand, is to reap revenue and profits, on the other hand, it is also to enhance its own competitiveness and brand image. The internationalization of many domestic innovative drug companies has also given us hope and dawn.
Valuation and fundamentals are "two days", pay attention to the bottom allocation opportunities
On the other hand, the current valuation level of the pharmaceutical sector does not match this "hot" scene and is still at a historical low. Considering the positive recovery of macro environmental factors such as U.S. bond interest rates, the low base of industry performance caused by changes in the market environment and the impact of the epidemic in the first three quarters of this year, and the pulling effect of large fields and large varieties on the industry, the pharmaceutical industry will usher in considerable growth prospects in 2024, and investment opportunities are expected to bloom.
According to the view of Guotai Junan's research report, the trend of public offering ** for the pharmaceutical sector to increase positions has begun to appear. Last week, only science and technology, medicine**, real estate sharply**. The top three sectors in terms of weekly returns were: Technology (1.)26%), medicine (0.29%), manufacturing (-0.25%), and the bottom three sectors in terms of weekly returns are: Real Estate (-4.).65%), new energy (-1.98%), financial (-193%）。
Hua Chuang** view: In the innovative drug sector, although the investment and financing section has slowed down, the R&D pipelines of many innovative drug companies have made positive progress, some products have been commercialized in China or even overseas, and the number of overseas authorized products is increasing day by day. In addition, innovative drugs continue to achieve breakthrough clinical data and commercial sales in large fields such as oncology, bariatric loss, AD, and NASH and new technologies such as ADC, which will have a greater impact on the investment sentiment and operating fundamentals of the sector.
He Yuxuan, manager of Tianhong Hang Seng Shanghai-Shenzhen-Hong Kong Innovative Drug Selection 50 ETF (517380)**: Compared with the whole market, medicine is still not priced correctly, and it will be the starting point of a new round of medicine. From a bottom-up point of view, the vast majority of large and medium-sized enterprises in the pharmaceutical industry have very excellent cost performance. From the perspective of industry comparison, we believe that no matter from the perspective of industry fundamentals or valuation level, medicine should be an investment choice that is difficult to miss (correspondingly, we have also noticed that the strategy teams of many brokerages in the market have begun to notice investment opportunities in medicine recently). With the completion of the disclosure of the performance report for the first three quarters disclosed by listed companies, we believe that the pharmaceutical sector has undergone long-term adjustment and the precipitation of fundamental policy expectations, with clear bottom characteristics, and fundamentals, policies, and funds (according to the three quarterly reports disclosed by each public offering, the pharmaceutical industry has now returned to an overweight state) is expected to form a joint force and is expected to develop a higher level. You can pay attention to the Hang Seng Shanghai-Shenzhen-Hong Kong Innovative Drugs Select 50 ETF Connection**a(014564) c(014565).
Risk Warning: The mention of ** in the article is not intended as a recommendation. Please read the legal documents of the product carefully before purchasing, and choose the product that suits you. The market is risky, and investors need to be cautious. **Can invest in Hong Kong Stock Connect targets**, you need to bear the unique risks caused by the differences in investment environment, investment targets, market systems and trading rules under the Hong Kong Stock Connect mechanism.
*: Tianhong**.
Disclaimer: This article is ** content, does not represent the position of this magazine, and does not constitute investment advice.