Investment Rating - The report maintains a "Buy" rating for the medical services industry [6] Core Views - The medical and biological sector experienced a decline of 2.77% this week, ranking 8th among the 31 primary industries in the Shenwan index. The Shanghai and Shenzhen 300 index fell by 2.19%, indicating that the medical sector underperformed by 0.59 percentage points [1] - The report highlights a new policy from the Ministry of Commerce aimed at promoting international medical tourism, which is expected to enhance the appeal of private hospitals by allowing them to tap into high-value services such as high-end physical examinations and cosmetic surgery [4] - The medical services sector's current Price-to-Earnings (PE) ratio is 30.77X, with a Price-to-Book (PB) ratio of 3.12X, reflecting a slight decrease from the previous week [3] Summary by Sections Industry Performance - The medical services sector index closed at 6472.58 points, down 4.32% for the week, while the overall medical and biological sector index fell by 2.77% [1][22] - Notable performers in the medical services sector included WuXi AppTec (0.0%) and Aier Eye Hospital (-1.8%), while companies like Sanbo Brain Science and Proprius saw significant declines of -20.7% and -16.8%, respectively [2][22] Valuation Metrics - The medical services sector's PE ratio (ttm) is 30.77X, with a one-year maximum of 41.13X and a minimum of 28.46X. The current PB ratio is 3.12X, with a one-year maximum of 4.00X and a minimum of 2.48X [3] Investment Suggestions - The report suggests focusing on high-growth areas such as ADC CDMO and the peptide CDMO in the weight loss drug supply chain, with companies like WuXi AppTec and Aier Eye Hospital recommended for their growth potential [5] - It also highlights the potential recovery in profitability for third-party medical testing laboratories and consumer healthcare sectors, particularly in ophthalmology and dentistry [5]

Investment Strategy - The multi-level payment system supports the development of innovation in the pharmaceutical industry, with China's innovation beginning to shine [11][12][14] - The approval of innovative drugs and medical devices by the National Medical Products Administration has reached 204 and 265 respectively since the 14th Five-Year Plan, with 50 innovative drugs approved in the first seven months of 2025 [11][12] - The total amount of license-out transactions in China's pharmaceutical industry reached $92.03 billion in the first three quarters of 2025, indicating rapid growth and increased international competitiveness of Chinese innovative drugs [11][12] Medical Insurance and Payment Mechanisms - The commercial health insurance market is expected to grow, with a premium scale of CNY 977.3 billion in 2024, supporting the development of innovative drugs and devices [12][43] - The introduction of a commercial health insurance directory for innovative drugs in 2025 marks a shift towards a multi-payment model, enhancing the payment structure for innovative drugs [36][37] - The basic medical insurance system focuses on essential coverage, while commercial insurance emphasizes innovation and advanced treatments, facilitating the commercialization of leading-edge medical technologies [14][36] Pharmaceutical Industry Trends - Chinese innovative drugs are making significant strides in international markets, with a notable increase in license-out transactions, particularly in the oncology sector [48][49] - The global oncology drug expenditure is projected to grow from $144 billion in 2019 to $441 billion by 2029, driven by innovative therapies such as ADCs and bispecific antibodies [48][58] - The commercialization of biosimilars is steadily progressing, with opportunities arising from the expiration of original patents in the global market [48][49] Medical Devices and Services - The medical device sector is experiencing growth due to policy support and demand release, with a focus on high-end medical equipment and innovative medical consumables [15][23] - The trend of high-end customized medical consumables is gaining traction, with Chinese manufacturers increasingly integrated into the global supply chain [15][23] - The development of brain-computer interface technology and AI medical applications presents significant investment opportunities [15][23] CXO and Life Sciences - Chinese CXO companies are enhancing their global competitiveness through superior technology and cost efficiency, with a recovery in order volumes expected in 2026 [4][15] - The investment environment for innovative drugs is improving, leading to a resurgence in orders for CXO companies since 2025 [4][15]

Investment Rating - The report maintains an "Outperform" rating for the pharmaceutical and biotechnology sector [5] Core Views - The overall performance of the pharmaceutical sector has been weaker than the broader market, with the medical services sector experiencing significant declines [1] - The U.S. medical device market in 2025 is expected to be driven by high-end innovative devices, while traditional mature businesses are showing mixed results [2] - The outlook for the Chinese market is cautious in the short term but optimistic in the long term, with specific segments like electrophysiology and diabetes management expected to perform well [2] Summary by Sections Market Performance - The overall A-share market declined by 0.24%, while the biotechnology sector fell by 0.22%, indicating a stronger performance relative to the overall market [1] - The medical device sector showed a slight increase of 0.60% [1] Key Company Earnings Forecasts and Investment Ratings - Major companies such as Mindray Medical, United Imaging, and WuXi AppTec are rated as "Outperform" with projected earnings growth for 2024 to 2027 [4] - For instance, Mindray Medical is expected to have a net profit of 116.7 billion CNY in 2024, with a PE ratio of 19.3x [4] Recommended Stocks - Mindray Medical is highlighted for its strong R&D and sales capabilities, benefiting from domestic medical infrastructure and international expansion [43] - WuXi AppTec is noted for its comprehensive drug development services, poised to benefit from the global outsourcing market [43] - Aier Eye Hospital is recognized as the largest eye care institution in China, leveraging its expertise for growth [43]

Investment Rating - The report maintains an "Outperform" rating for the pharmaceutical and biotechnology sector [5] Core Insights - The overall performance of the pharmaceutical sector has been weaker than the broader market, with a slight decline in the biopharmaceutical sector [1] - The U.S. medical device market is expected to see continued growth driven by high-end innovative devices, while traditional segments are experiencing mixed results [2] - The report expresses a cautious short-term outlook for the Chinese market but remains optimistic about long-term growth potential [2] Summary by Sections Market Performance - The overall A-share market declined by 0.24%, while the biopharmaceutical sector saw a smaller decline of 0.22% [1] - The medical device sector showed a positive performance with a 0.60% increase [1] Company Earnings Forecasts and Investment Ratings - Major companies such as Mindray Medical, United Imaging, and WuXi AppTec are rated as "Outperform" with projected earnings growth for 2024 to 2027 [4] - Mindray Medical is expected to achieve a net profit of 116.7 billion CNY in 2024, with a PE ratio of 19.3x [4] - United Imaging is projected to have a net profit of 12.6 billion CNY in 2024, with a significantly higher PE ratio of 85.4x [4] Key Company Recommendations - Mindray Medical is highlighted for its strong R&D and sales capabilities, benefiting from domestic medical infrastructure and international expansion [43] - WuXi AppTec is noted for its comprehensive service capabilities in drug development, poised to benefit from the global outsourcing market [43] - Aier Eye Hospital is recognized as the largest eye care institution in China, leveraging its scale and expertise for growth [43]

Core Insights - The report emphasizes the investment opportunities in the innovative drug industry chain and undervalued sectors within the pharmaceutical and biotechnology industry [1] - The investment rating is maintained at "Outperform the Market" [2] Group 1: Innovative Drug Development - Continuous progress in clinical development of innovative drugs is noted, with recent excellent clinical data from domestic innovative drugs presented at academic conferences, suggesting a focus on major academic meetings like ASCO in Q2 [4] - The trend of domestic innovative drugs expanding internationally continues, with multiple cooperation agreements indicating the recognition of China's R&D capabilities by multinational pharmaceutical companies [4] Group 2: CXO Industry Investment Opportunities - The CXO sector is identified as the strongest investment theme in the pharmaceutical sector, driven by improved international financing and a robust domestic innovative drug R&D environment [4] - Recommendations include companies such as WuXi AppTec, WuXi Biologics, and Kelun Pharmaceutical, which are expected to benefit from the growing demand in preclinical and clinical stages [4] Group 3: Home Medical Devices and Chain Pharmacies - The home medical device sector is projected to experience strong growth due to aging demographics and increased demand for popular products, with companies like Yuyue Medical and Sanofi Biologics highlighted for their strong positioning [4] - The retail pharmacy sector is expected to consolidate, with leading chain pharmacies like Yifeng Pharmacy and Dazhong Pharmacy likely to gain market share through effective supply chain management and acquisition capabilities [4] Group 4: Surgical Robotics Investment Opportunities - The National Healthcare Security Administration has introduced guidelines for pricing surgical and treatment assistance services, which may enhance the clinical application of intelligent innovative products [4] - Companies like MicroPort and Tianzhihang are noted for their advancements in surgical robotics and international market expansion [4] Group 5: Investment Portfolio - The investment portfolio includes A-shares such as Mindray Medical, United Imaging, and Aier Eye Hospital, as well as H-shares like CanSino Biologics and Hutchison China MediTech [4] Group 6: Industry Performance and Data Tracking - The pharmaceutical manufacturing industry reported a revenue of 24,870 billion yuan in 2025, with a slight decline of 1.2% year-on-year, while total profits increased by 2.7% to 3,490 billion yuan [8] - The retail sales of pharmaceuticals reached 7,294 billion yuan, reflecting a growth of 1.8% year-on-year [8] Group 7: Monthly Performance Review - The pharmaceutical sector experienced a slight decline of 0.18% in February, underperforming against the CSI 300 index [9] - The report indicates that the overall valuation of the pharmaceutical sector is relatively high, with a current PE (TTM) of 37.20, placing it in the 80.66% historical percentile [15]

Investment Rating - The report maintains a "Buy" rating for the disposable gloves industry, indicating a positive outlook for future returns [4][62]. Core Insights - The disposable gloves industry is expected to see price increases due to rising costs of key raw materials influenced by geopolitical tensions in the Middle East and fluctuations in international energy markets [2][20]. - Domestic leading companies in the disposable gloves sector are anticipated to benefit from price hikes, the release of overseas production capacity, and natural growth in end-user demand [2][21]. - The report emphasizes the importance of clinical value in the pharmaceutical sector, recommending investments in innovative drug and medical device companies [3][22]. Summary by Sections Market Review - The A-share pharmaceutical index fell by 2.99%, underperforming the CSI 300 index by 2.11 percentage points, ranking 14th among 31 sub-industries [1][15]. - The Hong Kong Hang Seng Medical Health Index decreased by 7.16%, lagging behind the Hang Seng Index by 5.04 percentage points [1][15]. Disposable Gloves Industry - The industry is poised for price increases due to rising costs of raw materials such as butadiene and acrylonitrile, which are linked to the oil and gas sector [2][20]. - Domestic companies are expected to capture a larger share of the global market through cost control, supply chain integration, and R&D advantages [2][21]. Investment Strategy - The report suggests focusing on innovative drug chains and high-value medical devices, recommending companies like Innovent Biologics, WuXi AppTec, and Mindray Medical [3][24]. - The report highlights the potential for domestic leaders in the disposable gloves market, such as YTY Group, to benefit from price increases and overseas capacity utilization [2][21]. Company Performance Forecast - Key companies in the pharmaceutical sector are projected to have positive earnings growth, with specific EPS forecasts for 2024-2026 [4]. - The report includes a detailed earnings forecast and valuation table for several companies, indicating a "Buy" rating for most [4].

Investment Rating - The report maintains an "Outperform" rating for the pharmaceutical and biotechnology sector [5][8]. Core Insights - The government work report has positioned biotechnology and pharmaceuticals as a new pillar industry, emphasizing the importance of innovation and development in this sector [2][11]. - The pharmaceutical and biotechnology sector has underperformed the overall market recently, with a decline of 2.78% compared to a 1.26% drop in the A-share market [1][21]. - The TTM price-to-earnings ratio for the pharmaceutical and biotechnology sector is 36.18x, which is at the 78.6th percentile of its historical valuation over the past five years [1][26]. Summary by Sections Government Positioning - The government has upgraded the status of the biotechnology and pharmaceutical industry, highlighting its role in driving new productivity and technological innovation [2][11]. - Key development opportunities during the 14th Five-Year Plan include innovation, elderly care, openness, and strengthening basic healthcare services [13]. Market Performance - The overall A-share market saw a decline of 1.26%, with the biotechnology sector declining by 2.78% [1][21]. - Specific sub-sectors such as medical services and medical devices experienced significant declines, with medical services down 4.71% [1][21]. Valuation Metrics - The TTM price-to-earnings ratios for various sub-sectors are as follows: chemical pharmaceuticals at 43.80x, biological products at 45.58x, medical services at 32.48x, and medical devices at 39.48x [26]. Recommended Stocks - Major companies recommended for investment include: - Mindray Medical (300760.SZ): Strong in R&D and international expansion [30]. - United Imaging Healthcare (688271.SH): Focused on high-performance medical imaging and digital solutions [30]. - WuXi AppTec (603259.SH): A leading open-access drug development service platform [30]. - Aier Eye Hospital (300015.SZ): The largest eye care institution in China [30]. - Yuyue Medical (002223.SZ): A leading provider of medical devices and solutions [31].

Investment Rating - The report maintains an "Outperform" rating for the pharmaceutical and biotechnology sector [5] Core Insights - The government work report has positioned biotechnology and pharmaceuticals as a new pillar industry, emphasizing the importance of innovation and development in this sector [2][11] - The pharmaceutical and biotechnology sector has underperformed the overall market recently, with a decline of 2.78% compared to a 1.26% drop in the A-share market [21] - The current price-to-earnings (P/E) ratio for the pharmaceutical and biotechnology sector is 36.18x, which is at the 78.6th percentile of its historical valuation over the past five years [26] Summary by Sections Government Work Report - The report highlights the establishment of biotechnology and pharmaceuticals as a new pillar industry, with a focus on innovation and the development of new technologies such as artificial intelligence and quantum technology [2][11] - Key development opportunities during the 14th Five-Year Plan include innovation, elderly care, openness, and strengthening basic medical services [13] Market Performance - The overall A-share market saw a decline of 1.26%, with the biotechnology sector declining by 2.78%, indicating weaker performance compared to the broader market [21] - Specific declines were noted in various sub-sectors, including medical services down 4.71% and medical devices down 2.94% [21] Valuation Metrics - The P/E ratios for various sub-sectors are as follows: chemical pharmaceuticals at 43.80x, biological products at 45.58x, medical services at 32.48x, and medical devices at 39.48x [26] Recommended Stocks - Major companies recommended for investment include: - Mindray Medical (迈瑞医疗): A leader in medical devices with strong R&D and international expansion [30] - United Imaging Healthcare (联影医疗): Focused on high-performance medical imaging and digital solutions [30] - WuXi AppTec (药明康德): A comprehensive drug development service platform benefiting from global outsourcing trends [30] - Aier Eye Hospital (爱尔眼科): The largest eye care institution in China, leveraging international technology and management [30]

Investment Rating - The report maintains a strong rating for the CXO sector, indicating a positive outlook for investment opportunities in the industry [4]. Core Insights - The global and Chinese healthcare investment markets are expected to recover by 2025, with record highs in licensing transactions and upfront payments for Chinese innovative drugs, indicating enhanced global competitiveness of Chinese pharmaceutical companies [1][2]. - The CXO market is projected to experience stable growth by 2026, driven by a recovery in downstream demand and a reduction in geopolitical risks due to amendments in the U.S. Biodefense Act [1][3]. Summary by Sections 1. CXO Market Growth - The global and Chinese preclinical CRO markets are forecasted to reach $33.25 billion and 52.86 billion RMB respectively by 2026, with the clinical CRO market expected to reach $73.2 billion and 59.8 billion RMB [2][19]. - The global CDMO market is anticipated to grow to $118.9 billion by 2026 and $338.5 billion by 2033, with China's CDMO market expected to reach 137 billion RMB by 2026 [2][36]. 2. Industry Concentration and Competitive Landscape - The industry is witnessing accelerated concentration, with leading companies like WuXi AppTec and Tigermed establishing strong competitive advantages through integrated service offerings [3][53]. - By 2025, WuXi AppTec's revenue is projected to reach 45.456 billion RMB, with a net profit margin significantly above the industry average [3][53]. 3. Investment and Financing Trends - In 2025, the global healthcare sector completed 1,930 financing transactions totaling $63.2 billion, with a year-on-year increase of 8.6% [56]. - China’s healthcare sector saw 797 financing transactions amounting to $9.7 billion, reflecting a 32.9% increase year-on-year [58]. 4. Policy Environment and Risk Mitigation - The revised U.S. Biodefense Act is expected to alleviate immediate impacts on the domestic biopharmaceutical industry, as it no longer explicitly names specific companies [74][75]. - The market has transitioned from panic pricing to rational pricing, indicating a recovery in investor sentiment following the enactment of the revised Biodefense Act [76]. 5. Valuation and Performance Analysis - The CXO sector saw a 55.26% increase in 2025, outperforming the Shanghai Composite Index, with a current PE ratio of 26.75, indicating a significant valuation premium over historical averages [78][79]. - The sector's revenue for the first three quarters of 2025 reached 73.788 billion RMB, marking a 10.08% increase year-on-year, while net profit grew by 51.90% [80][85].

香港交易及結算所有限公司及香港聯合交易所有限公司對本公告的內容概不負責，對其準確 性或完整性亦不發表任何聲明，並表明概不就因本公告全部或任何部份內容而產生或因倚賴 該等內容而引致的任何損失承擔任何責任。 WUXI APPTEC CO., LTD. * 無錫藥明康德新藥開發股份有限公司 （於中華人民共和國註冊成立的股份有限公司） （股份代號：2359） 董事會會議召開日期 無錫藥明康德新藥開發股份有限公司（「本公司」，連同其子公司「本集團」）董 事會（「董事會」）謹此宣佈將於2026年3月23日（星期一）召開董事會會議，以考 慮及批准（其中包括）本集團截至2025年12月31日止年度全年業績，及建議之末 期股息（如有），以及處理任何其他事項。 承董事會命 無錫藥明康德新藥開發股份有限公司 董事長 李革博士 香港，2026年3月9日 於本公告日期，本公司董事會包括執行董事李革博士、陳民章博士、楊青博士及張朝暉先生； 非執行董事童小幪先生及吳亦兵博士；以及獨立非執行董事盧韶華女士、俞衛博士、張新博 士、詹智玲女士及冷雪松先生。 * 僅供識別 ...