CICC's outlook for the biopharmaceutical industry in the second half of 2026: Clear development of the innovative drug industry chain, short-term adjustments do not change the trend of long-term rise.

The outlook for the biopharmaceutical industry in the second half of 2026, as pointed out by CITIC Securities, indicates that despite the impact of factors such as macro environment, disturbances in major country relations, and rotational liquidity, the innovative drug sector is entering a phase of short-term valuation correction. However, from the perspective of industry trends, China's innovative drugs BD and clinical data readings continue to show a good development trend, demonstrating the internationalization of Chinese innovative drugs through forms such as license out and new co. The domestic and international pharmaceutical industry investment and financing environment has brought about a new round of research and development investment for the industry, while also providing potential orders for upstream industries such as CXO, ensuring strong performance growth in pharmaceutical supply. On one hand, there is optimism about the pioneering nature of medical technology: in addition to the breakthrough and internationalization of innovative drugs, the development of new technologies such as AI pharmaceuticals and brain-machine interfaces is also promising, with some domestically produced medical devices gradually seizing structural internationalization opportunities. On the other hand, pharmaceutical stocks with high dividends have relatively low valuations, and while mergers and acquisitions integration bring opportunities for value reassessment, they also have the potential to accumulate new growth momentum.