According to the Zhitong Finance APP, Founder Securities has released a research report stating that the pharmaceutical and biotechnology industry is entering a new upward cycle, with overseas orders accelerating and being in the early stages of industry growth, showing strong upward momentum. They are firmly optimistic about upstream companies in the biotechnology category with strong overseas capabilities; in the CXO sector, the early research industry chain has significant growth potential, and innovative drugs going overseas present historic opportunities.
<h2>Founder Securities' main viewpoints are as follows:</h2>
Early Research CRO: The transfer of the early research CRO industry is timely, and the demand for experimental monkeys is steadily increasing.
Preclinical and safety evaluation orders are gradually recovering. The firm believes that the new upward cycle may benefit from: 1) The wave of innovative drug business development (BD) going overseas has highlighted and recognized the advantages of the domestic early research industry chain (quality + efficiency + cost), thus the overseas early research industry chain is expected to gradually shift to China; 2) After entering a rate-cutting cycle, overseas pharmaceutical companies' R&amp;D demand is gradually recovering. Therefore, it is recommended to pay attention to leading companies in niche areas such as Yinos, JOINN, and the integrated preclinical CRO leader Pharmaron (the mismatch situation may continue, and the price of experimental monkeys is expected to stabilize and rise in the short term), as well as WuXi AppTec. In addition, in the safety evaluation field, experimental monkeys are considered a strategic resource, and the firm believes that the short-term supply-demand mismatch situation may continue, with prices expected to stabilize and rise in the short term.
Upstream Biotechnology: Domestic biotechnology categories are recovering rapidly, and the industry's overseas expansion is in full swing.
In the first half of 2025, the growth rate of biological reagents, including culture media, recombinant proteins, molecular building blocks, and chromatography fillers, is accelerating, mainly benefiting from: 1) The structural recovery brought by domestic innovative drugs going overseas; 2) The rapid growth of the industry's overseas expansion. Therefore, the firm continues to be optimistic about the overseas expansion of upstream products. On one hand, the overseas market has vast potential, and under the demand for cost reduction from pharmaceutical companies, domestic brands offer cost-effectiveness; on the other hand, the &#34;water&#34; brought by domestic innovative drug BD is gradually flowing into early-stage research. It is recommended to pay attention to upstream companies related to the biopharmaceutical industry chain with overseas capabilities, including ACROBIOSYSTEMS, BIOCYTOGEN-B, and Haoyuan Pharmaceutical.
Clinical CRO: The industry inflection point may be approaching, with SMO recovering first.
Domestic demand is expected to gradually improve, with SMO orders recovering first. The firm expects that as financing for innovative drugs recovers, INDs are likely to advance successively, driving an increase in the number of clinical projects, with overall orders expected to recover as volume increases and prices stabilize. Additionally, the supply-side structure continues to optimize, and leading companies are expected to continue gaining market share. It is recommended to pay attention to leading clinical CROs such as Tigermed and Novotech.
CDMO Sector: The potential of new molecular tracks is enormous, and the performance elasticity of related suppliers is promising.
The overall performance in the mid-term report is excellent, with segments such as peptides and ADCs leading in growth rates. In the short term, the peptide and ADC sectors are expected to maintain high prosperity; in the long term, other new molecules, including small nucleic acids, still have development potential. It is recommended to focus on leading CDMO companies such as Kelun and WuXi AppTec, which rely on stable small molecule businesses while rapidly developing new molecular businesses, promising performance elasticity.
Risk Warning: Risks of interest rate cuts and early R&amp;D demand from innovative drug BD falling short of expectations, risks of policy fluctuations under geopolitical tensions, and risks of CDMO downstream commercial product sales falling short of expectations

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Fangzheng Securities released a research report indicating that the pharmaceutical and biotechnology industry has entered a new upward cycle, and the recovery of financing for innovative drugs will drive the growth of clinical projects. It is recommended to pay attention to upstream companies in the biotechnology sector with strong overseas capabilities and the early research CRO industry chain, believing that the domestic early research industry chain will benefit from the recovery of overseas demand. It is expected that the price of experimental monkeys will remain stable with a slight increase in the short term, and the prospects for upstream biological products going overseas are broad

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Founder Securities: A new round of upward movement in the pharmaceutical industry has begun, focusing on early research and the new trend of CRO industry outsourcing