Investment Rating - The report recommends a "Buy" rating for multiple companies in the pharmaceutical sector, including Junshi Biosciences, Hualing Pharmaceutical-B, Aorite, and others [1]. Core Views - The pharmaceutical sector experienced a 3.29% increase this week, outperforming the CSI 300 index by 4.37 percentage points. Sub-sectors such as pharmaceutical commerce, pharmacies, and innovative drugs performed well, while medical devices and consumables lagged [2][12]. - The report emphasizes the importance of market pricing power and the impact of liquidity and risk appetite on investment strategies, particularly in innovative drugs and related supply chains [2][12]. - The report highlights the upcoming patent expirations for small molecule drugs, which are expected to create significant demand for raw materials, with a projected sales impact of $390 billion from 2025 to 2030 [3][13]. Summary by Sections Industry Performance - The pharmaceutical sector's performance this week was characterized by a 3.29% increase, with notable performances in pharmaceutical commerce (+7.31%), pharmacies (+6.83%), and innovative drugs (+5.01%). In contrast, medical devices (0.16%) and new medical infrastructure (1.18%) showed weaker performance [17][29]. - The overall price-to-earnings (P/E) ratio for the pharmaceutical industry is reported at 30.84 times, with a premium of 25.08% compared to the overall A-share market excluding the financial sector [33]. Company Dynamics - Notable company announcements include: - Prologis Pharmaceuticals received a European certificate for its product, enhancing its international market prospects [18]. - Jianyou Co. announced FDA approval for its production site, expanding its manufacturing capabilities [19]. - Fuyuan Pharmaceuticals received a drug registration certificate from the National Medical Products Administration, allowing for the marketing of its product [20]. - The report suggests focusing on companies benefiting from domestic innovative drug support policies, such as Yangguang Nuohuo and Nuosige, as well as those with strong overseas business prospects [15][7]. Raw Materials - The report indicates that the raw materials sector is expected to see a significant increase in demand due to patent expirations, with a projected sales impact of $390 billion from 2025 to 2030. The production of raw materials in H1 2025 reached 1.935 million tons, reflecting an 8.2% year-on-year increase [3][13]. - Companies recommended for attention in the raw materials sector include Aorite, Prologis Pharmaceuticals, and Aoxiang Pharmaceuticals, focusing on innovation and strong performance [3][16].

Core Viewpoint - Prolo Pharmaceutical's wholly-owned subsidiary, Zhejiang Prolo Jiayuan Pharmaceutical Co., Ltd., has received the Certificate of Suitability (CEP) for Venlafaxine Hydrochloride from the European Medicines Agency [2] Group 1 - The CEP certificate indicates that the product meets the European Pharmacopoeia standards, which is crucial for market access in Europe [2] - This certification may enhance the company's competitive position in the European pharmaceutical market [2] - The approval reflects the company's commitment to quality and regulatory compliance in its product offerings [2]

Core Viewpoint - Prolo Pharmaceutical's subsidiary, Zhejiang Prolo Jiayuan Pharmaceutical Co., Ltd., has received the CEP certificate for Venlafaxine Hydrochloride from the European Directorate for the Quality of Medicines (EDQM), indicating the product's compliance with European quality standards and enhancing the company's potential for international market expansion [1] Group 1 - Prolo Pharmaceutical's subsidiary has been recognized with a CEP certificate for Venlafaxine Hydrochloride, a selective serotonin and norepinephrine reuptake inhibitor (SNRI) used to treat various types of depression and generalized anxiety disorder [1] - The receipt of the CEP certificate signifies the recognition and affirmation of the quality of the raw material by the European regulatory market [1] - This certification allows the product to enter the EU market and other markets that recognize the CEP certificate, positively impacting the company's international market expansion efforts [1]

Core Viewpoint - The announcement highlights that Zhejiang Prolo Home Pharmaceutical Co., Ltd., a wholly-owned subsidiary of Prolo Pharmaceutical, has received the Certificate of Suitability (CEP) for Venlafaxine Hydrochloride from the European Medicines Agency, indicating the quality recognition of this active pharmaceutical ingredient in the European market [1] Group 1 - The CEP certificate for Venlafaxine Hydrochloride signifies the product's compliance with European pharmacopoeia standards [1] - Venlafaxine Hydrochloride is used for treating various types of depression, including anxiety-related depression and generalized anxiety disorder [1] - The certification allows the product to enter the EU market and other markets that recognize the CEP certificate, facilitating international market expansion for the company [1]

Core Viewpoint - Prolo Pharmaceutical (000739.SZ) announced that its wholly-owned subsidiary, Zhejiang Prolo Jiayuan Pharmaceutical Co., Ltd., received the Certificate of Suitability (CEP) for Venlafaxine Hydrochloride from the European Directorate for the Quality of Medicines (EDQM) [1] Group 1 - The CEP certificate is significant for Venlafaxine Hydrochloride, which is a selective serotonin and norepinephrine reuptake inhibitor (SNRI) [1] - Venlafaxine Hydrochloride is used for treating various types of depression, including depression with anxiety, and generalized anxiety disorder [1]

Core Viewpoint - Pro Pharmaceutical's subsidiary, Jiayuan Pharmaceutical, has received the CEP certificate for Venlafaxine Hydrochloride, enabling the product to enter the EU and other markets that recognize the CEP certificate [1] Company Summary - Pro Pharmaceutical's subsidiary, Jiayuan Pharmaceutical, has been granted the European Pharmacopoeia Certificate of Suitability (CEP) for Venlafaxine Hydrochloride [1] - This certification allows the product to qualify for entry into the European Union and other markets that acknowledge the CEP certificate [1] Industry Summary - Venlafaxine Hydrochloride is classified as a selective serotonin and norepinephrine reuptake inhibitor (SNRI) [1] - It is utilized for the treatment of various types of depression, including depression accompanied by anxiety, as well as generalized anxiety disorder [1]

Core Viewpoint - The announcement indicates that the company's wholly-owned subsidiary, Jiayuan Pharmaceutical, has received the CEP certificate for Venlafaxine Hydrochloride from EDQM, effective from October 28, 2025, which signifies the product's quality recognition in the European market [1] Group 1 - The CEP certificate number is CEP2023 - 219 - Rev00, which validates the quality of Venlafaxine Hydrochloride used for treating various types of depression and generalized anxiety disorder [1] - The certification marks the product's qualification to enter the EU and other markets, positively impacting the company's international market expansion efforts [1] - The international active pharmaceutical ingredient (API) business remains uncertain, prompting a cautionary note for investors regarding potential risks [1]