Investment Rating - The report maintains a "Buy" rating for Renfu Pharmaceutical (600079) [1][7] Core Views - Renfu Pharmaceutical's core business shows stable growth, particularly in the neurology medication sector, while its subsidiaries are achieving significant results in innovation and transformation [1][5][6] - The company reported a revenue of 12.064 billion yuan for the first half of 2025, a year-on-year decrease of 6.20%, primarily due to structural reforms in the pharmaceutical payment sector and ongoing optimization of its business structure [4] - The net profit attributable to shareholders reached 1.155 billion yuan, reflecting a year-on-year increase of 3.92% [4] Summary by Sections Neurology Medication Growth - Yichang Renfu, the largest designated research and production base for anesthetics in Asia, holds over 60% of the domestic market share for anesthetic drugs [5] - In the first half of 2025, Yichang Renfu achieved a revenue of 4.423 billion yuan, a decrease of 1.75%, while net profit increased by 0.49% to 1.432 billion yuan [5] - Revenue from neurology medications reached approximately 3.9 billion yuan, with a year-on-year growth of about 4%, driven by strong sales of products like remifentanil and sufentanil [5] Innovation and Transformation - The company is accelerating its strategic shift from generic drugs to innovative drugs, with R&D investment reaching 743 million yuan in the first half of 2025, a year-on-year increase of 5.32% [6] - A total of 14 new products across 21 specifications have been approved, supporting the development of various product lines, including new neurology and steroid hormone medications [6] Financial Forecast and Projections - The company forecasts revenues of 26.7 billion yuan, 28.2 billion yuan, and 29.9 billion yuan for 2025, 2026, and 2027, respectively, with year-on-year growth rates of 4.87%, 5.85%, and 6.01% [7][9] - Net profit attributable to shareholders is projected to be 2.3 billion yuan, 2.5 billion yuan, and 2.7 billion yuan for the same years, with significant growth expected in 2025 at 70.04% [7][9] - The earnings per share (EPS) are expected to be 1.39 yuan, 1.50 yuan, and 1.63 yuan for 2025, 2026, and 2027, respectively, with corresponding price-to-earnings (PE) ratios of 15, 14, and 13 times [7][9]

Core Viewpoint - The approval of the drug registration certificate for Oxycodone Hydrochloride Tablets by the National Medical Products Administration marks a significant milestone for the company, enabling it to sell the product in the Chinese market [1] Group 1: Company Developments - The company's subsidiary, Yichang Renfu Pharmaceutical Co., Ltd., has received the drug registration certificate for Oxycodone Hydrochloride Tablets, which are indicated for the relief of moderate to severe cancer pain [1] - The approved specifications for the Oxycodone Hydrochloride Tablets are 15mg and 30mg [1] - The company submitted the marketing authorization application in January 2024, which has been accepted, and the total R&D investment for this project has reached approximately 11 million RMB [1] Group 2: Industry Context - The approval of Oxycodone Hydrochloride Tablets positions the company to compete in the pain management market, particularly for cancer patients [1] - Beijing Huasu Pharmaceutical Co., Ltd. received a drug registration certificate for its 5mg Oxycodone Hydrochloride Tablets in May 2024, indicating a competitive landscape in the market [1]