CRO concept stocks declined collectively. As of press release, Viva Biotech (01873) fell 7.95% to HK$0.81; Fangda Holdings (01521) fell 6.82% to HK$2.05; Kanglong Chemical (03759) fell 6.74% to HK$13; and Zhaoyan Pharmaceutical (06127) fell 6.57% to HK$1.66.
The Zhitong Finance App learned that CRO concept stocks were collectively lower. As of press release, Viva Biotech (01873) fell 7.95% to HK$0.81; Fangda Holdings (01521) fell 6.82% to HK$2.05; Kanglong Chemical (03759) fell 6.74% to HK$13; and Zhaoyan Pharmaceutical (06127) fell 6.57% to HK$1.66.
The China Merchants Bank Research Institute said that looking ahead to 2024, in anticipation of the Federal Reserve's interest rate cut, high interest rates will further eliminate the constraints on global pharmaceutical investment and financing. The amount of pharmaceutical investment and financing will recover favourably. The total amount of financing has increased by 35% in Q3 of 2023. Judging from the number of new projects added by Pharmaceutical Biotech, the difficult times for the CXO industry are basically over, and the industry is expected to resume relatively rapid growth in 2024.
At the same time, the agency pointed out that domestic demand for innovative drugs is still weak, and investment and financing will recover later than in the global market, while CXO companies' production capacity is ready, making production capacity relatively overcapacity. In order to obtain orders, the price war is likely to continue. Furthermore, the sufficient production capacity of leading companies is compounded by competition between Japanese, South Korean, and Indian manufacturers for orders from Europe and the US, and the industry will still clearly divide. Small and medium-sized CDMO companies are under high cash pressure, and they still need to beware of risks.