The Zhitong Finance App learned that on November 24, according to the “Notice on Accomplishing the Prevention and Control of COVID-19 Infections and Other Key Infectious Diseases in Winter and Spring” issued by the joint prevention and control mechanism of the State Council, since October, the activity of influenza and mycoplasma pneumoniae infections in China has gradually increased. Influenza and mycoplasma pneumoniae infections are on the rise in many places. It is expected that influenza will peak in the winter and spring epidemic across the country, and mycoplasma pneumoniae infections will continue to be high in some regions for some time to come. Minsheng Securities said that there is a high incidence of respiratory infectious diseases in winter, so it is recommended to pay attention to the increase in terminal demand for products such as influenza vaccines, respiratory disease drugs, and respiratory pathogen testing.

Recently, various respiratory pathogens have been compounded, and acute respiratory diseases have continued to rise in China. The National Health Commission held a press conference on November 26 and mentioned that respiratory infectious diseases are mainly influenza, in addition to rhinovirus, mycoplasma pneumoniae, respiratory syncytial virus, and adenovirus. Analysts believe that the recent rise in acute respiratory diseases in China is related to the superposition of various respiratory pathogens.

Furthermore, on November 23, the Central Meteorological Observatory continued to issue a cold tide warning. According to the forecast, the cold tide will continue to descend southward in China, and widespread cooling will reach many parts of Jiangnan. A new wave of cold waves and cooling is expected to accelerate the spread of respiratory diseases such as influenza to a certain extent.

The rising trend of influenza and mycoplasma pneumoniae infections will increase upstream testing manufacturers and downstream drug manufacturers, etc., and the market's attention on topics related to drug supply, testing, and vaccination has increased.

In terms of drug supply, Teyi Pharmaceutical said in response to questions from investors that the company has a rich range of pharmaceuticals, and its products cover all categories such as cough relief, antipyretic, antibiotics, antiviral drugs, and digestive system. The company will arrange production plans reasonably to ensure that market needs are met. Jiaying Pharmaceutical also said that in response to the current influenza epidemic, the company's management and employees in various departments have responded actively and concentrated their efforts to speed up production. Currently, cold products are basically at full production and sales.

Zhongsheng Pharmaceutical said on November 24 that the company's innovative influenza drug, onradivir tablets (R&D code: ZSP1273), has completed phase III clinical trials. The symptomatic treatment of influenza produced by the company includes Zhongsheng pill series products, ibuprofen tablets, acetaminophen tablets, etc.

In terms of testing, the Donghai Securities Research Report shows that at present, there are six nucleic acid detection products for respiratory pathogens on the market. One sample can detect 6 types of pathogens (influenza A virus, influenza B virus, respiratory syncytial virus, adenovirus, human rhinovirus, and mycoplasma pneumoniae), which can provide an accurate clinical basis for molecular diagnosis. Companies engaged in POCT (instant testing) business, such as Innotek, Antu Biotech, and Wanfu Biotech, have received a lot of attention.

Furthermore, Everbright Securities analyst Lin Xiaowei believes that the influenza vaccine is a golden race track for the birth of major global varieties, but the penetration rate of this field is still low in China, and there is still huge room for growth in the future. As the fall and winter temperatures cool down this year and the high influenza season approaches, it is expected that demand for influenza vaccine terminals will increase, and the performance and market attention of related companies will be strongly boosted. Virus testing is also one of the main areas of short-term benefit.

Zheshang Securities, on the other hand, sorted out emerging influenza trends and investment opportunities in sectors such as influenza prevention, medication, and testing:

Chemicals and APIs sector: Winter is generally a period of high incidence of influenza. Short-term influenza drug use is expected to contribute some elasticity to the performance of the chemicals and APIs sector in 2023Q4 and 2024Q1. It is recommended to focus on pharmaceutical companies that have commercial products for influenza drugs and companies that provide APIs. I recommend Borui Pharmaceutical (oseltamivir API+formulation), focus on Dongguang Pharmaceutical, Yipinhong, etc., and it is also recommended to focus on Zhongsheng Pharmaceutical and Xiansheng Pharmaceutical, where innovative anti-influenza drug products are in phase III clinical trials.

Traditional Chinese medicine sector: Against the backdrop of a high 2022-Q4 base, the short-term growth of influenza varieties in 2023Q4 may exceed expectations. We recommend Guilin Sanjin (watermelon cream), a long-established brand in the throat field, Jichuan Pharmaceutical, Kangenbei, and Kangyuan Pharmaceutical, which have a rich lineup of cold and influenza products, focusing on Teyi Pharmaceutical, Eling Pharmaceutical, Sunflower Pharmaceutical, China Resources 39, Hongri Pharmaceutical, Guizhou Sanli, Buchang Pharmaceutical, etc.

Drugstore chains: Marginal expectations continue to improve, and the high incidence of influenza is expected to drive the growth rate for the better. I recommend Dashenlin, Ordinary People, and Yifeng Pharmacy, and focus on Yixintang, Jianzhijia, and Shuyu Minmin.

Influenza vaccine: Quadrivalent influenza has a high penetration rate, focusing on the value of leading investments. Recommended attention: Hualan vaccine.

In vitro diagnosis: It is recommended to focus on companies that have a first-mover advantage and perfect product layout in the field of influenza testing, such as Innotek, Wanfu Biotech, and Shengxiang Biotech.

Related concept stocks:

Shandong Xinhua Pharmaceutical Co., Ltd. (00719): Mainly engaged in the development, manufacture and sale of chemical APIs, preparations and chemical products; the company's main products include antipyretic and analgesic APIs, tablets, injections, capsules, and pharmaceutical intermediates.

Dongguang Changjiang Pharmaceutical (01558): In March of this year, the Daimo Research Report pointed out that as the main manufacturer of the anti-influenza virus drug “oseltamivir” in the mainland, Dongyang Pharmaceutical's performance was directly driven by the actual spread of influenza and related expectations.

Clover Bio-B (02197): Clover Biotech recently announced that the company has completed a marketing declaration for its seasonal influenza vaccine to Brazil's National Health Supervisory Authority. Once approved, the company will work further with local partners in Brazil to commercialize the influenza vaccine in Brazil. The company said that once the vaccine is approved in Brazil, the commercialization of the company's seasonal influenza vaccine will expand to the southern hemisphere and win the sales market for the influenza season in the first half of the year in the southern hemisphere. This will complement the sales market for the influenza season in the second half of the year in the northern hemisphere, such as China, so that the company's seasonal influenza vaccine can win a full-year sales cycle and increase sustainable profits.

Xiansheng Pharmaceutical (02096): Xiansheng Pharmaceutical announced that on October 10, the Group signed a cooperation agreement with Jiaxing Anticonn Biotechnology Co., Ltd. (Anticonn) on the innovative drug ADC189. Under the agreement, the Group will receive exclusive commercialization rights for the product in China for influenza indications. This cooperation will further strengthen the Group's product layout in the field of anti-infection.