医药生物行业周报：产新药闪耀ESMO；关爱计划加快短缺药物研发

Investment Rating - The report maintains an "Overweight" rating for the pharmaceutical and biotechnology sector [1]. Core Insights - The report highlights the strong performance of domestic new drugs showcased at the ESMO conference and the acceleration of drug development for shortages under the "Caring Plan" [2][6]. - It emphasizes the need for a bottom-up stock selection approach due to the weakening beta of sub-sectors, suggesting a focus on individual stock alpha opportunities [5][8]. - The report notes that the pharmaceutical sector remains resilient against macroeconomic pressures, with continuous growth and demand, making it a sector worth investing in despite recent market downturns [3][5]. Summary by Sections Market Dynamics - The pharmaceutical sector has underperformed, with a return of -27.0% year-to-date compared to -7.9% for the CSI 300 index, indicating a 19.1% underperformance [3][8]. - Recent market trends show a decline in various sub-sectors, with medical services up by 0.96% while chemical pharmaceuticals, medical devices, biological products, traditional Chinese medicine, and pharmaceutical commerce have seen declines ranging from 1.44% to 6.72% [5][8]. Valuation Metrics - The current valuation of the pharmaceutical sector is at 18.4 times PE based on 2024 earnings forecasts, which is a 25.4% premium over the overall A-share market (excluding financials) [3][8]. - Using the TTM valuation method, the sector's PE stands at 22.2 times, below the historical average of 35.4 times, indicating a relative premium of 34.1% over the broader market [3][8]. Key Recommendations - The report recommends focusing on segments with strong fundamentals and low valuations, such as pharmaceuticals, diagnostics, and medical devices, as well as state-owned enterprises with stable growth and high dividends [5][8]. - Specific companies highlighted for potential investment include China Resources Sanjiu, Kangfang Biotech, Betta Pharmaceuticals, and others, which have shown resilience and growth potential [2][12].