The trend of the innovative pharmaceutical sector is improving, and high-quality assets have entered the allocation range.

Recently, the A-share innovative pharmaceutical sector experienced a strong rebound followed by a short-term adjustment, stabilizing and rising on July 9. This round of market volatility is driven by the high and low switching of funds in the technology sector and policy-driven favorable conditions. Hong Kong stocks in the innovative pharmaceutical sector also strengthened, with a continuous increase in buybacks. On the industrial level, Chinese innovative pharmaceutical companies continue their high growth trend in going global, and their BD partnerships are upgrading from traditional single authorization to joint development and profit-sharing models. The demand for the CXO industry chain is picking up while supply is clearing, enhancing profit recovery expectations. Analysts believe that the core focus of the innovative pharmaceutical sector is shifting from "can it go global" to "can commercial profit be realized", and the valuation of high-quality innovative pharmaceutical companies has entered an attractive range for allocation. Short-term fluctuations do not change the overall positive trend in the medium to long term, and it is recommended to seize opportunities to allocate on dips.