Investment Rating - The report maintains an "Accumulate" rating for the pharmaceutical and biotechnology sector [7]. Core Insights - The report highlights the emergence of the "Protein Degradation 2.0" era, focusing on domestic companies involved in this field [12][18]. - The pharmaceutical sector is expected to experience a structural bull market in 2025, driven by supportive policies for commercial health insurance and innovation in drug development [14]. Summary by Sections Recent Review - During the week of April 14-18, the Shenwan Pharmaceutical Index decreased by 0.36%, outperforming the ChiNext Index but underperforming the CSI 300 Index [12]. - The market showed a recovery with small-cap innovative drugs performing well, while the overall pharmaceutical sector remained volatile [13]. Future Outlook - Short to medium-term strategies focus on self-sufficiency in research instruments and upstream components, deepening the exploration of innovative drugs, and identifying high-growth companies based on Q1 reports [14]. - By 2025, a positive trading atmosphere is anticipated, with structural growth likely in the pharmaceutical sector [14]. Investment Strategy - **Pharmaceutical Style Rhythm**: Key companies include innovative drug firms such as Sanofi, BeiGene, and others focusing on self-sufficiency like BGI Genomics and others [15]. - **Pharmaceutical Industry Logic**: Emphasis on innovative drugs with commercial potential, self-sufficiency in medical devices, and new technologies like AI in medicine [16]. Protein Degradation Sector - The report discusses the rapid advancement in the targeted protein degradation (TPD) field, with over 95 projects in clinical development globally, including 35 in China [24]. - Notable domestic companies in the TPD space include Innovent Biologics, BeiGene, and others, with several new drugs recently approved for clinical trials [26][25]. Subsector Performance - The innovative drug index decreased by 0.60% during the week, while the generic drug sector saw a 1.80% increase, indicating a shift in market focus [36]. - The traditional Chinese medicine index outperformed the overall pharmaceutical index, highlighting a potential area for investment [43]. Key Events - The report notes significant events such as the approval of innovative drugs by companies like CanSino Biologics and the performance of various pharmaceutical firms in their quarterly reports [41][34].