2016-strategies in the pharmaceutical & health industry: China, looking for room to grow

China looking for industry increment in the health sector

      Due to the ageing of the population structure, environmental pollution and disease in China, the healthcare picture is changing. There is an increasing incidence of cancer, hypertension, cerebrovascular disease, and the declining incidence of digestive system and respiratory system diseases.  It is believed that due to future tumors, cardio-cerebral-vascular drug revenue growth is expected to have a rapid growth, releasing large amounts of drug demand in these areas, with strong growth in the pharmaceutical industry to determine in the future.

Growth in the pharmaceutical industry in 8%-10% territory.

      2015, 1 September income growth in the pharmaceutical industry reported 9.03% profit growth. This showed some slowdown in revenue growth and profit growth than in previous years, but profit growth starts faster than income growth, mainly due to: health control fees, drug bidding prices, slowing overall revenue in the pharmaceutical industry; second, the pharmaceutical enterprises are to strengthen internal management, control costs, and profits grew faster than income growth. We believe that as the future continuation of the tender prices, the health control fees and income growth in the pharmaceutical industry of the future will remain at 8%-10% intervals.

In 2016, the policy direction is clear.

      Future policy direction along:

1) Medical service market reform: implementation of medical market release and medicine separation, breaking medical market monopoly;

2) Building grading clinic system: promoted medical service system to a stereo of more level collaborative service of direction development, strengthened based medical market in three level medical system in the role;

3) established drug price II for Yuan pricing mode, strengthening drug tender, and Medicare control fee on drug price of guide and supervision.

Investment advice.

      Looking to the future direction of the pharmaceutical industry, representative of new technologies and new business models, the industry trends towards good future investment opportunities would be greater than the traditional industry. With the slowdown in revenues and profits in the pharmaceutical industry, the traditional business slowdown in the future growth of the pharmaceutical industry, with leads in the technology development and innovation business model, active extension and expansion of the company leads to the focus of future investment direction. Investment recommends the following aspects focus as recommended:

1) Benefit of grading clinic, medical resources sinking, third party diagnosis outsourcing and industry leading enterprise Dean diagnosis;

2) Benefit of drug review approval reform and drug innovation capacity strong of China Sea drug industry;

 3) Personalized medical with future development of direction, bullish and gene measuring sequence industry leading China’s big gene cooperation, has strong gene analysis and store capacity of wing of joint;      

4) Benefit of medical service market release, which has extension type expansion of Shang Rong medical.