Shenwan Hongyuan Securities·2026-01-25 13:35Investment Rating - The report maintains a "Cautious" investment rating for the pharmaceutical sector, highlighting the need to focus on specific investment opportunities within the CXO segment and AI pharmaceutical developments [2]. Core Insights - The pharmaceutical sector is currently experiencing a mixed performance, with the Shenwan Pharmaceutical and Biological Index down by 0.4% this week, ranking 27th among 31 Shenwan primary sub-industries [3][5]. - The overall valuation of the pharmaceutical sector stands at 30.3 times earnings, placing it 12th among 31 Shenwan primary industries [5]. - The report emphasizes the ongoing transformation of the pharmaceutical retail industry towards comprehensive health services, driven by a joint opinion from nine government departments [13][14]. - New drug development remains active, with significant advancements such as the NDA acceptance for Bai Li Tianheng's EGFR×HER3 dual antibody ADC and Moderna's personalized mRNA cancer vaccine showing promising results [15][16]. Market Performance - The Shenwan Pharmaceutical and Biological Index decreased by 0.4%, while the Shanghai Composite Index increased by 0.84% [3]. - Among the secondary sectors, the performance varied, with raw materials (+2.4%) and offline pharmacies (+9.7%) showing positive growth, while medical research outsourcing (-4.0%) and chemical preparations (-1.7%) faced declines [5][12]. Industry Dynamics - By the end of 2025, China's total population is projected to be approximately 1.40489 billion, with a birth rate of 7.92 million, indicating a slight decrease in population compared to the previous year [12]. - The pharmaceutical retail industry is undergoing a critical transformation, with a focus on enhancing pharmacy services and optimizing industry structure [13][14]. - The report outlines five key measures to promote high-quality development in the pharmaceutical retail sector, including improving pharmacy service capabilities and enhancing emergency service functions [14]. Company Developments - Bai Li Tianheng's NDA for the EGFR×HER3 dual antibody ADC has been accepted, targeting esophageal squamous cell carcinoma [15]. - Moderna's personalized mRNA cancer vaccine has shown a 49% reduction in recurrence or death risk compared to monotherapy with Keytruda [16]. - The launch of Insilico Medicine's large language model training framework aims to enhance drug discovery capabilities significantly [16]. Financing Dynamics - OpenEvidence, an AI medical platform, successfully raised $250 million in Series D funding, achieving a post-money valuation of $12 billion [22]. - Qixing Pharmaceuticals completed a $287 million D1 round of financing to advance its clinical pipeline for cardiovascular and metabolic diseases [22]. Performance Forecasts - Several companies in the pharmaceutical sector have released optimistic earnings forecasts for 2025, indicating a clear industry trend [2]. - Notable companies to watch include WuXi AppTec, Kanglong Chemical, and Tigermed, among others, as they are expected to benefit from the ongoing industry developments [2].