Cinda: "The 'Double Catalogue' of Medical Insurance and Commercial Insurance has been officially released, highlighting investment opportunities in innovative drugs and related industrial chains."

Cinda released a research report stating that there is currently a lack of clear main line in the short term for the pharmaceutical and biotechnology market. On December 7, the National Medical Insurance Bureau released the first version of the "medical insurance + commercial insurance dual directory". The bank believes that this may help boost investment enthusiasm for innovative drugs in the short term. At the same time, the stock prices of the innovative drug sector have recently experienced a slight correction, but the long-term logic of the rise of Chinese innovative drugs remains unchanged. The bank recommends focusing on investment opportunities in innovative drugs, CXO, and the upstream industry chain of life sciences in the near future. In addition, the bank believes that stocks that show short-term operational improvements and stable dividends are also worth paying attention to, and there may be turning point opportunities for high-end medical devices. Cinda's main points are as follows: Market performance: Last week, the pharmaceutical and biotechnology sector had a return rate of -0.74%, ranking 21st in terms of rising and falling among 31 primary sub-industry indices relative to the Shanghai and Shenzhen 300 Index. Among the six sub-sectors, the pharmaceutical commercial sector had the highest weekly return rate, ranking first with a 5.19% increase (relative to the Shanghai and Shenzhen 300 Index's 3.91% return rate). The medical services sector, ranking sixth, had a return rate of -1.37% (relative to the Shanghai and Shenzhen 300 Index's -2.65% return rate). Innovative drugs: Considering the scientific breakthrough leadership and forward-looking market space of the product pipeline, the bank recommends focusing on companies such as INNOVENT BIO, 3SBIO, Jiangsu Hengrui Pharmaceuticals, Kelun Pharmaceutical, Sichuan Biokin Pharmaceutical, REMEGEN, Innovent Biologics, Huayu Pharmaceutical, GENSCRIPT BIO, Weiteli Pharma, and LEE'S PHARM. CXO and the upstream industry chain of life sciences: 1) Leading global CXO companies with global influence, the bank recommends paying attention to WuXi AppTec, WUXI BIO, WUXI XDC, Pharmaron Beijing, Asymchem Laboratories, etc. 2) Clinical CRO leaders with mainly domestic business, the bank recommends focusing on companies like Hangzhou Tigermed Consulting, SMO Clinplus, R&G PharmaStudies, and Beijing Sun-Novo Pharmaceutical Research. 3) Resource-based CXO companies represented by safety evaluation and model animals, the bank suggests focusing on companies like Joinn Laboratories, Shanghai InnoStar Bio-tech, Shanghai Medicilon Inc., Biotools, and GemPharmatech. 4) Life sciences upstream industry chain, the bank recommends paying attention to companies such as Acrobiosystems, Shanghai Haoyuan Chemexpress, Bide Pharmatech, Suzhou Nanomicro Technology, Shanghai OPM Biosciences, Qingdao Haier Biomedical Co., Ltd., Shanghai Aladdin Biochemical Technology Co., Ltd., and Shanghai Titan Scientific Co., Ltd. Operating improvements and high-dividend targets: 1) It is recommended to pay attention to Guangzhou Baiyunshan Pharmaceutical Holdings. 2) It is recommended to focus on SINOPHARM. High-end medical devices: 1) Pharma equipment benefiting from overseas pharma entering an investment boom cycle, the bank recommends focusing on companies like MORIMATSU INTL, Tofflon Science and Technology Group, Truking Technology, etc. 2) Business growth driven by hospital procurement recovery, the bank recommends paying attention to companies like Shanghai United Imaging Healthcare, Sonoscape Medical Corp., Shinva Medical Instrument, Shenzhen Mindray Bio-Medical Electronics, Shanghai Aohua Photoelectricity Endoscope, and Sws Hemodialysis Care. 3) Demand for consumer medical devices is gradually recovering, the bank recommends focusing on companies like Jiangsu Yuyue Medical Equipment & Supply, Cofoe Medical Technology, and Sinocare Inc. 4) Companies with recovering overseas orders, the bank recommends paying attention to companies like MeHow Innovative, Qingdao Novelbeam Technology, and BMC Medical. 5) The penetration rate of high-end device consumables continues to increase, the bank recommends focusing on companies like Shanghai MicroPort Endovascular MedTech (Group) Co., Ltd., MICROPORT, WEIGAO GROUP, MICROPORT NEURO, AK MEDICAL, Beijing Chunlizhengda Medical Instruments, etc. Risk factors: Changes in tariff policies & geopolitical risks; lower-than-expected product sales; lower-than-expected clinical data; price reductions in centralized procurement higher than expected; intensified market competition risks.