Investment Rating - The report maintains an "Overweight" rating for the pharmaceutical and biotechnology industry, expecting the industry index to outperform the market index by over 10% in the next six months [1][40]. Core Insights - The SW pharmaceutical and biotechnology industry outperformed the CSI 300 index, rising by 7.84% from July 11 to July 24, 2025, exceeding the CSI 300's performance by approximately 4.13 percentage points [4][14]. - Most sub-sectors within the industry recorded positive returns during the same period, with the medical research outsourcing and raw materials sectors leading with increases of 14.23% and 9.30%, respectively [4][15]. - Approximately 91% of stocks in the industry achieved positive returns, with notable performers including Borui Pharmaceutical, which saw a weekly increase of 78.98% [16]. Summary by Sections 1. Market Review - The SW pharmaceutical and biotechnology industry outperformed the CSI 300 index, with a rise of 7.84% from July 11 to July 24, 2025, surpassing the CSI 300 by about 4.13 percentage points [14]. - Most sub-sectors recorded positive returns, particularly medical research outsourcing and raw materials, which increased by 14.23% and 9.30%, respectively [15]. - About 91% of stocks in the industry had positive returns, with Borui Pharmaceutical leading at 78.98% [16]. 2. Industry News - The report highlights the ongoing progress of the 11th batch of national drug procurement, with significant updates provided during a government open day event on July 22, 2025 [4][28]. - The announcement of the 11th batch of national drug procurement included a notification for drug information submission, which was highly anticipated [4][28]. 3. Company Announcements - Yekang Pharmaceutical announced that its subsidiary received FDA approval for clinical trials of YKYY029 injection for hypertension treatment [29]. 4. Industry Outlook - The report maintains an "Overweight" rating for the industry, citing a continuous rise in the pharmaceutical and biotechnology sector driven by positive sentiment towards innovative drugs and improved financing data [30]. - The report suggests focusing on investment opportunities within the innovative drug supply chain and highlights several companies across various segments, including medical devices, pharmaceutical commerce, and innovative drugs [30][32].

Core Themes - The third China International Supply Chain Promotion Expo (Chain Expo) was held in Beijing, focusing on six major chains including advanced manufacturing, clean energy, smart automotive, digital technology, health living, and green agriculture [1] - Over 650 enterprises and institutions from 75 countries and regions participated, with foreign exhibitors accounting for 35% [1] Company Highlights - Yiling Pharmaceutical showcased its achievements in promoting high-quality development in traditional Chinese medicine (TCM) through solidifying the industrial chain, activating the innovation chain, and extending the health chain [3] - Yiling Pharmaceutical emphasized strict quality control of Chinese medicinal materials, establishing over 60 cultivation bases across the country, which also helps local farmers increase their income [4] - The company presented patented new drugs and innovative products in the health sector, including the Ba Zi Bu Shen capsule, which focuses on anti-aging applications [4] - Yiling Pharmaceutical aims to enhance the internationalization of TCM, with a product distribution map covering over 50 countries and regions [5] Industry Innovations - Guangzhou Pharmaceutical Group, the first TCM company to enter the Fortune Global 500, demonstrated its innovative practices in the TCM supply chain through a digital ecosystem, research innovation, and smart logistics [6] - The group has established nearly 90 standardized planting bases and has implemented blockchain technology for traceability and quality control, achieving a 148% increase in production capacity and a 289% increase in efficiency [6] - Sanofi highlighted its 30 years of localization in China, showcasing its high-quality manufacturing capabilities and a comprehensive immunization service chain [7][8] - GE Healthcare presented its latest high-end medical equipment and announced the establishment of a green supply chain innovation ecosystem alliance to promote sustainable practices in the medical device industry [9] - Steady Medical emphasized its commitment to reducing environmental pollution and introduced a new series of medical beauty products aimed at protecting public health [10]

Core Viewpoint - The third China International Supply Chain Promotion Expo highlights the importance of industrial collaboration and international cooperation, showcasing innovative developments in the supply chain sector [1] Group 1: Innovation and Development Model - Yiling Pharmaceutical has established a unique "theory-clinical-research-industry-education" innovation development model, which integrates traditional Chinese medicine theory with clinical practices and research [1] - The company has undertaken over 60 national and provincial-level projects and holds more than 800 domestic and international patents, demonstrating its commitment to innovation [1] Group 2: Evidence-Based Research - Yiling Pharmaceutical is a pioneer in conducting internationally recognized evidence-based medical research, completing over 40 studies that are among the highest in quantity and quality in the industry [2] - Significant breakthroughs have been achieved in cardiovascular disease prevention, with studies showing a 41% reduction in diabetes risk and a 36% reduction in adverse cardiovascular events [2] Group 3: International Recognition - Research on Yiling's Qi Li Qiang Xin capsules published in the journal Nature Medicine indicates a 22% reduction in major composite endpoint events for heart failure patients [3] - The efficacy of the company's products is gaining international recognition, transitioning traditional Chinese medicine from "experience-based" to "evidence-based" practices [3] Group 4: Health Product Development - Yiling Pharmaceutical's health products, including anti-aging solutions, have attracted attention at the expo, showcasing the integration of technology in traditional medicine [4] - The company has developed over ten proprietary sub-health management products and has a pipeline of more than a hundred product concepts, catering to various health needs [5] Group 5: Market Response - Domestic and international customers have praised Yiling Pharmaceutical's series of health products, indicating strong market interest and acceptance [6]

Group 1 - The innovative drug concept is leading a resurgence in the pharmaceutical market, with companies like Lizhu Group and Borui Pharmaceutical experiencing significant stock price increases [1][3] - The National Healthcare Security Administration (NHSA) recently held a meeting focusing on the comprehensive value assessment of innovative drugs and medical devices, indicating ongoing support for innovation in the sector [3] - A report from CITIC Securities highlights that the NHSA is promoting a shift from low-price competition to quality competition, which is expected to benefit companies with strict quality systems and cost advantages [3] Group 2 - The first drug-focused ETF in China (562050) is gaining attention, concentrating on the top 50 pharmaceutical companies, particularly those involved in innovative drugs and traditional Chinese medicine [4] - The report anticipates that over 90% of innovative drugs will succeed in the 2024 healthcare negotiations, with domestic products accounting for over 70% of that success [3] - The domestic innovative drug companies are expected to enhance their international competitiveness, driven by new technologies and supportive policies [3]

Core Viewpoint - The Chinese medicine sector is experiencing a positive trend, with the Zhongzheng Traditional Chinese Medicine Index showing an increase, driven by innovative evaluation methods and potential policy changes in the pharmaceutical landscape [1][2]. Group 1: Market Performance - As of July 22, 2025, the Zhongzheng Traditional Chinese Medicine Index (930641) rose by 0.56%, with notable increases in constituent stocks such as Xintian Pharmaceutical (002873) up 3.03%, and Pian Zai Huang (600436) up 2.69% [1]. - The Chinese Medicine ETF (159647) also saw a rise of 0.50%, marking its fifth consecutive increase, with the latest price reported at 1.01 yuan [1]. Group 2: Research and Innovation - A team led by Professor Xiao Xiaohua from the Fifth Medical Center of the PLA General Hospital has proposed a novel method for evaluating the effectiveness of traditional Chinese medicine, published in the authoritative journal "Pharmaceutical Journal" [1]. Group 3: Investment Insights - According to Jiao Yin International, the current driving force behind the Hong Kong innovative drug market is value reassessment, with domestic investors increasing their positions through the Hong Kong Stock Connect, while foreign investors remain at a low position in innovative drugs [1]. - The first innovative drug catalog involving commercial insurance is expected to be launched in 2025, which aims to include products beyond basic medical insurance coverage, potentially creating a more favorable pricing environment compared to traditional medical negotiations [1]. Group 4: Index Composition - As of June 30, 2025, the top ten weighted stocks in the Zhongzheng Traditional Chinese Medicine Index accounted for 55.96% of the index, including Pian Zai Huang (600436) and Yunnan Baiyao (000538) among others [2].

Core Insights - The third China International Supply Chain Promotion Expo was held in Beijing from July 16 to 20, showcasing cutting-edge technologies and innovations in the supply chain sector [1] - The event highlighted the Ba Zi Bu Shen capsules, a prominent product in traditional Chinese medicine aimed at anti-aging, demonstrating its unique appeal and latest research findings [1][2] Company Insights - Ba Zi Bu Shen capsules are formulated with eight natural plant seeds and precious medicinal materials, effectively intervening in ten biological aging markers, thus delaying aging and preventing age-related diseases [2] - The capsules have been clinically validated in a study published in the journal "Phytomedicine," which involved 530 participants aged 30 to 78, showing a 76.7% increase in telomerase activity among users, indicating potential longevity benefits [2][7] - The product has successfully entered markets in eight countries and regions, including Canada and Singapore, with a cumulative consumption exceeding 226 million capsules, primarily among users aged 35 and above [7] Industry Insights - The expo served as a platform for promoting the unique advantages and application prospects of traditional Chinese medicine in the anti-aging field [7] - The company aims to enhance research and development efforts in traditional Chinese medicine, contributing to scientific advancements in anti-aging [7]

Core Viewpoint - The third China International Supply Chain Promotion Expo showcases the development of traditional Chinese medicine (TCM) and its integration into modern health solutions, emphasizing the importance of quality in the TCM supply chain and innovation in product offerings [2][9]. Group 1: Supply Chain and Quality Management - The quality of traditional Chinese medicinal materials is fundamental to the industry's development, with Yiling Pharmaceutical implementing strict management protocols from seed to product [3]. - Yiling Pharmaceutical has established over 60 medicinal material cultivation bases across seven major production areas in China, covering tens of thousands of acres and involving over 40 varieties [3]. - The company’s model of "company + base + farmers" not only ensures the quality of medicinal materials but also provides stable income for local farmers, achieving a balance between environmental sustainability and economic growth [3]. Group 2: Innovation in Services and Products - Yiling Pharmaceutical has developed over 560 varieties of traditional Chinese medicine granules, streamlining the preparation process to enhance convenience for consumers [4]. - The company has created a complete industrial chain that includes cultivation, research, production, sales, and health services, reinforcing the foundation for high-quality development in TCM [4]. Group 3: Research and Development - Yiling Pharmaceutical has pioneered a unique innovation model that integrates theory, clinical practice, research, industry, and education, leading to the development of patented new drugs based on traditional theories [5]. - The company has undertaken over 60 national and provincial research projects and has received multiple national awards, showcasing its commitment to advancing TCM through scientific research [5][6]. Group 4: Health Product Development - Yiling Health, a subsidiary of Yiling Pharmaceutical, has developed a range of health products targeting various demographics, including fatigue relief for professionals and anti-aging formulas for seniors [8]. - The company has created over ten proprietary sub-health management products and has a pipeline of more than a hundred product concepts, demonstrating its adaptability in the health market [8]. Group 5: Global Outreach and Academic Exchange - Yiling Pharmaceutical has successfully entered international markets with its innovative TCM products, obtaining over a hundred international approvals for various health products [9]. - The company has been actively promoting TCM globally through academic exchanges and collaborations with international institutions, enhancing the recognition of TCM in the global academic community [9].

Group 1 - The core viewpoint of the articles highlights Yiling Pharmaceutical's significant achievements in the field of innovative traditional Chinese medicine, showcasing its strong R&D capabilities and successful product registrations [1][2][3] - Yiling Pharmaceutical's R&D investment reached 908 million yuan in 2024, accounting for 13.94% of its revenue, indicating a leading position in the industry regarding R&D intensity [1] - The company has multiple products in various stages of clinical trials, including six new traditional Chinese medicine varieties, and has successfully registered the classic formula Banxia Baizhu Tianma Decoction [1][2] Group 2 - Yiling Pharmaceutical's chemical drug segment is also accelerating, with its subsidiary Yiling Wanzhou focusing on the development of innovative drugs, including the NDA application for Anilofin Injection [2] - The company reported a revenue of 2.358 billion yuan and a net profit of 326 million yuan for the first quarter of 2025, reflecting a year-on-year growth of 7.25% and 11.23% respectively [2] - The company has established a competitive R&D system and product reserve in the respiratory and cardiovascular fields, supported by the theory of collateral diseases [2]

Core Viewpoint - The third China International Supply Chain Promotion Expo (Chain Expo) was held from July 16 to 20 in Beijing, focusing on the theme "Linking the World, Creating the Future" and showcasing various sectors including advanced manufacturing, clean energy, smart vehicles, digital technology, health living, and green agriculture, attracting 651 companies and organizations from 75 countries and regions [1][10] Company Overview - Yiling Health participated in the Chain Expo, showcasing innovative health products in the "Health Living Chain" exhibition area, demonstrating its development cluster from medicine to health [1][3] Health Industry Focus - The "Health Living Chain" exhibition area emphasizes key products and technologies in the health sector, promoting a green and healthy lifestyle while supporting consumption and domestic demand [3] - Yiling Health's strategy aligns with this focus, integrating traditional medicine and health practices to create a comprehensive health management solution covering all life stages [3][4] Product Innovation - Yiling Health has developed a diverse range of health products to address common health issues such as high blood sugar, abnormal blood lipids, and sleep disorders, reflecting a shift from treatment-centered to health management-centered approaches [4][6] - Key products showcased include: - **Yimeng Beverage**: Targets blood lipid levels and sleep quality using a blend of five medicinal ingredients [4] - **Jinliwang Beverage**: A sugar-free drink designed for blood sugar management, utilizing six medicinal ingredients [6] - **Wanbi'an Soft Capsules**: Aimed at improving sleep quality, featuring the traditional calming herb sour jujube seed [6] Comprehensive Health Solutions - Yiling Health's product matrix extends beyond blood sugar and lipid management to include hypertension, weight loss, anti-aging, immune enhancement, fatigue resistance, and bone health, promoting proactive health management [7] - The company emphasizes the importance of managing health risks early to prevent chronic diseases, advocating for a philosophy of "health needs management" [7] Quality Assurance in Production - Yiling Health ensures product quality through strict control of traditional Chinese medicine materials, establishing a collaborative model with local farmers to guarantee the authenticity and quality of raw materials [8] - The company has built over 60 high-standard medicinal herb cultivation bases across major regions in China, covering more than 40 varieties of traditional Chinese medicine [8][9] Future Outlook - Yiling Health aims to leverage the Chain Expo to deepen exchanges and share its experiences in building a full lifecycle service industry chain in traditional Chinese medicine, exploring new paths and models for health industry development [10]

Core Viewpoint - The company has received approval for its innovative traditional Chinese medicine, Qi Fang Bi Tong Pian, marking a significant milestone as the first approved OTC traditional Chinese medicine in Macau for treating persistent allergic rhinitis, indicating strong potential for market expansion [4]. Group 1: R&D Investment and Product Development - The company has increased its R&D investment to 908 million yuan, accounting for 13.94% of revenue, which is a year-on-year increase of 4.88 percentage points, positioning it as a leader in the industry [5]. - The company is committed to technological innovation, continuously advancing new product development, and enhancing the scientific content of its existing products [5]. - The company has six new traditional Chinese medicine products currently in clinical stages, with recent applications for new drug registrations and clinical trials being accepted by the National Medical Products Administration [5]. Group 2: Financial Performance and Future Outlook - In Q1 2025, the company reported revenue of 2.358 billion yuan, a year-on-year decrease of 6.52%, while net profit attributable to shareholders was 326 million yuan, an increase of 7.25% year-on-year [6]. - The company anticipates a gradual improvement in overall performance throughout 2025, despite facing challenges such as revenue decline and rising raw material costs [6][7]. - The company’s subsidiary, Yiling Wanzhou, is focusing on the development of innovative drugs, with four products currently in clinical and application stages, including a non-steroidal analgesic that has received NDA acceptance [7].