Traditional chemical pharmaceutical companies are positioned in the CRO field. In the future, it is expected that epitaxial integration companies will continue to enter the CRO field by acquiring Xinyuan Company and entering the CRO field based on the current pharmaceutical industry environment. In the future, it is expected that they will continue to build a CRO resource integration platform through endogenous business expansion and epitaxial acquisition. Formulation process optimization work began in '12, and rush the consistency evaluation company used the drug capsule incident to pay close attention to product quality when the CFDA first proposed a consistency evaluation in '12, and initiated secondary development of already marketed products, including improving quality standards (formulation, process optimization, etc.), so preparations for the consistency evaluation were adequate. Currently, more than half of the products that need to be evaluated have completed pharmaceutical evaluations, and other unfinished varieties are in the process of being actively researched and evaluated. The company's pharmaceutical product market is large, but the competitive pattern is poor. This consistency evaluation provides a good opportunity to overtake cars at curves. With the acquisition of Xinshengyuan, companies in the CRO industry bought Xinshengyuan at a price of 900 million yuan. Xinshengyuan executives also participated in the additional distribution, tied to interests of listed companies. As a professional CRO service provider, Xinshengyuan has strong government affairs capabilities and has cooperated with over 100 CRO agencies to serve over 550 R&D projects. We expect the current order amount to exceed 2 billion yuan. With the current increase in demand in the CRO industry and the gradual maturity of incubated projects, Xinshengyuan is expected to exceed its four-year performance in gambling. Risks suggest that the company's pharmaceutical products in various provinces did not meet expectations and bid prices were reduced; the risk of performance fluctuations due to uncertainty about the progress of the Xinyuan project; and the failure of acquisition integration. For the first time coverage, the “increased holdings” rating was given, predicting that the company's operating income for 16-18 was 9.53/11.30/1,331 billion yuan, net profit was 1.72/2.12/257 million yuan, the diluted EPS was 0.64/0.79/0.96 yuan, and the current stock price corresponds to PE53/43/35x. The company's original chemical formulation business has recovered to normal levels after experiencing the negative impact of the previous anti-drug and drug capsule incident. In 2015, it began to actively move upstream in the pharmaceutical R&D industry chain and enter the CRO field. At a time when the medical industry is currently active in R&D innovation and consistent evaluation, and demand in the CRO industry is increasing dramatically, while drug review and supervision is being tightened and the CRO industry is entering a major integration, the company is expected to use Xinyuan as a platform to quickly build a comprehensive, three-dimensional, and comprehensive pharmaceutical and medical device R&D service platform through endogenous expansion and external acquisition integration. It was covered for the first time, and a “accumulation of holdings” rating was given.