Industry Investment Rating - The report maintains a "Recommend" rating for the pharmaceutical and biotechnology industry, driven by the growing momentum of domestic companies expanding overseas [2] Core Views - The dual factors of overseas market attractiveness and domestic market competition pressure are accelerating the overseas expansion of domestic pharmaceutical companies [2] - The pharmaceutical industry's overseas expansion is transitioning from APIs and generics to innovative drugs, with license-out becoming the dominant model for innovative drug exports [2][25] - Domestic medical device companies are entering a high-quality development phase in overseas markets, with product competitiveness gradually reaching global standards [2][43] - The global pharmaceutical market is expected to grow at a CAGR of 5.8% from 2021 to 2027, reaching 2trillion,providingsignificantopportunitiesfordomesticcompanies[19]DomesticPharmaceuticalOverseasExpansion−TheoverseasrevenueofA−sharepharmaceuticalcompaniesgrewfrom∗∗31.175billionyuan∗∗in2010to∗∗246billionyuan∗∗in2023,withaCAGRof17.22102.06 billion**, a year-on-year decrease of 20.7%, with Western drugs accounting for 50% of total exports [10][11] - APIs accounted for 40.91billion∗∗ofexportsin2023,down20.745.52 billion in 2023, down 22.8% year-on-year, with traditional medical device exports (excluding pandemic-related products) declining by only 3.1% [13] - Traditional Chinese medicine (TCM) exports totaled 5.46billion∗∗in2023,down3.31.4 trillion in 2021 to 2trillion∗∗by2027,drivenbypopulationgrowth,aging,andimprovedhealthcaresystems[19]−The∗∗USpharmaceuticalmarket∗∗isthelargestglobally,with∗∗innovativedrugs∗∗accountingfor∗∗7946.5 billion, a 69% increase from 2022 [25][26] - Baili Heng's HER3/EGFR bispecific ADC deal with BMS reached a potential total value of 8.4billion∗∗,settinganewrecordfordomesticinnovativedruglicense−outtransactions[26]−∗∗Collaborativedevelopment∗∗and∗∗independentoverseasexpansion∗∗modelsarealsogainingtraction,withcompanieslike∗∗BeiGene∗∗and∗∗LegendBiotech∗∗achievingsignificantmilestonesintheUSandEuropeanmarkets[29][31]MedicalDeviceOverseasExpansion−Domesticmedicaldevicecompaniesaremakingbreakthroughsin∗∗high−endmarkets∗∗,withproductsin∗∗imaging∗∗,∗∗ultrasound∗∗,and∗∗in−vitrodiagnostics∗∗reachingglobalstandards[2][43]−In2023,China′smedicaldeviceexportstotaled∗∗249.1billionyuan∗∗,with∗∗Asia∗∗,∗∗NorthAmerica∗∗,and∗∗Europe∗∗beingthetopthreemarkets,accountingfor∗∗34.4540.91 billion, down 20.7% year-on-year, with export volume increasing by 5.4% despite a 24.7% drop in average prices [39] - India and the US are the top two export markets for Chinese APIs, accounting for 12.77% and 10.39% of total exports respectively [41]
