CITIC Securities: A platform company with the ability to integrate pharmaceutical and insurance resources and technological barriers, expected to stand out and grow into an industry leader

CITIC Securities believes that as the boundaries of basic medical insurance management become clearer, commercial insurance is expected to become the core growth driver in the payment side of the healthcare industry. Current policy benefits, data assets, and the iteration of commercial health insurance products are resonating, potentially ushering in a new cycle of diversified payment system development in the healthcare industry. In the next phase, CITIC Securities believes that comprehensive service providers in commercial insurance may overcome talent and data constraints on the insurer side, breaking structural bottlenecks faced by innovative drug and device companies in realizing their innovation value, further accelerating the marginal development of the commercial health insurance industry. They believe that as commercial insurance payment penetration increases and data-driven cost control models mature, platform companies with drug insurance resource integration capabilities and technological barriers are likely to stand out and grow into industry leaders. We continue to recommend focusing on the following three investment themes: 1) Platform companies empowering drug insurance collaboration to initiate a new cycle of payment system “upgrade”; 2) Innovative drugs and devices—benefiting from increased payment volume brought by commercial health insurance and valuation system improvements; 3) Private medical terminals—welcoming new payers and opening future growth potential.