Comply with the direction of pharmaceutical industry policy, cro / CMO short-term prosperity or higher

[pharmaceutical network market analysis] according to the industry, through the view on the space of the pharmaceutical industry, we always embrace innovation as the core idea of investment in the pharmaceutical industry, and select the pharmaceutical enterprises with core innovation ability For pharmaceutical investment, we should follow the direction of industrial policies in the next few years, in which cro / CMO will have a higher short-term prosperity and innovative pharmaceutical enterprises will be more able to obtain long-term value, at least long-term growth potential, depending on the ability of enterprises to internationalize It is understood that thanks to the steady growth of global R & D expenditure, the improvement of outsourcing penetration and the upgrading of cro / cdmo industry's own technology mode, the industry as a whole has maintained a high momentum Leading companies are in the expansion cycle in terms of personnel and production capacity The continuous release of production capacity and periodic resonance of superimposed demand push cro / cdmo industry into the golden development period According to relevant data forecast, China's cro market size will reach 21.4 billion US dollars in 2023, with a compound growth rate of 29.6% in 2018-2023; China's cdmo / CMO market size will reach 8.5 billion US dollars in 2023, with a compound growth rate of 28.9% in 2018-2023 Domestic cro / cdmo leading enterprises will benefit from strong demand, business model upgrading and long-term perspective, and are expected to build a platform centered innovation and financing ecosystem The industrial chain of new drug R & D and production is becoming more and more complicated and refined, which leads to higher cost and more difficulty in R & D It is understood that in 2019, the proportion of public funds' heavy positions in Listed Companies in the pharmaceutical R & D and production outsourcing (CRO / cdmo) sector will continue to increase In recent years, the single output of cro industry has been increasing Although in the past, the single output of cro company has increased significantly, compared with the global leader, the single output of domestic leader is only 1 / 3-1 / 2 of the global leader Therefore, with the increase of the number of orders and the optimization of management, there is still a lot of room to improve the single output of domestic cro companies According to the industry, the development of domestic pharmaceutical R & D and production outsourcing industry is booming That is to say, no matter from the R & D investment of Listed Companies in the secondary market or the financing activity of small and medium-sized pharmaceutical enterprises in the primary market, they are all engaged in the R & D of new drugs However, both mature large pharmaceutical enterprises and start-up new drug R & D enterprises have demand for cro / cdmo companies, but the focus may be different: large pharmaceutical enterprises outsource some R & D links due to the decline of new drug investment return, while small pharmaceutical enterprises have to rely on cro to provide integrated R & D capabilities due to their insufficient capabilities "In any case, the demand of pharmaceutical companies for cro / cdmo will only become more and more urgent." Some insiders said However, the R & D of new drugs in China started late, and the R & D investment was low Most cro & CMOS were based on the dividend of domestic engineers and the orders of overseas pharmaceutical companies The advantage of human cost leads to lower customer acquisition cost and strong order acquisition ability However, the overseas market, especially in Europe and the United States, is becoming more and more mature, and the industry growth is stable At the same time, the domestic cro industry is highly prosperous, which is the core driving force for the growth of cro & CMO onshore outsourcing business It is suggested that the rise of domestic innovative pharmaceutical industry and the substantial increase of R & D investment will maintain the cro industry valuation at a high stage It mainly recommends the industry leader of each subdivision field: Wuxi apptec, etc It is reported that before the clinical application of Wuxi apptec, the cro business sector continued to expand its territory: ① the capacity of toxicology laboratory was expanded by 80% (24000 square meters), and the total planning of Suzhou drug safety evaluation center expansion project of the raised investment project was increased by 87000 square meters, with an estimated building area of 2022 After the expansion, it will better meet the needs of global customers for drug safety evaluation; ② actively layout the strategic resources of non-human primate experimental animals, which is conducive to cost control and can effectively guarantee the high-quality supply of high-end experimental animals It is estimated that the net profit attributable to the parent company in 2019-2021 will be 22.43/28.59/3.653 billion yuan respectively, with a year-on-year growth of - 1% / 27% / 28%, maintaining the "buy" rating