Key investment events: The company recently invested 10 million yuan with Li Xiaochuan, Wang Li, and Feng Rentian to set up Xuhui Testing. Among them, the company invested 5.2 million yuan with its own capital, accounting for 52% of the shares. Recently, Xuhui Testing completed industrial and commercial registration. Alliance new drug research and development experts set up a biological sample testing company to further improve the company's industrial layout. Dr. Li Xiaochuan, Xuhui's testing partner, has presided over and participated in the research and development of a number of new drugs, including the innovative Chinese medicine salvia polyphenolate powder injections, pharmacokinetics research on a class of new drugs, and developed a homocysteine HCY test kit in plasma. Among them, the salvia polyphenolate powder injection project won the first prize of Shanghai Science and Technology; during his time at Zhaoyan New Pharmaceutical, he was responsible for completing drug metabolism research on more than 31 new drugs; founded Ningbo Bainaxi in 2014, dedicated to the development of drugs for the treatment of non-alcoholic steatohepatitis. The addition of top experts in the industry directly upgrades the company's pharmaceutical research level and further enhances the comprehensive service capabilities of new drug research and development and consistency evaluation business. The subsidiary is expected to officially operate by the end of the year, and will enjoy the consistency evaluation dividend in 2017 to further enhance the company's performance. Clinical trial standards are clear+prices have been raised drastically, and the CRO industry is gradually picking up. The enthusiasm of clinical trial institutions is gradually recovering, project progress is gradually picking up, and an inflection point in the industry looms. The main changes are: 1) clinical trial data standards are clear, and clinical trial institutions have rules to follow; 2) with the improvement of implementation standards, the price of new clinical orders in the industry has been raised by about 1-2 times, and clinical trial institutions' enthusiasm for project execution is gradually recovering; 3) The clinical trial base filing system is expected to be implemented by the end of the year, and the bottleneck of large-scale implementation will be completely eliminated with strong consistency evaluations. The company is fully prepared, and with the consistency evaluation dividend, performance is expected to explode starting in 2017. The company's business covers pre-clinical and clinical research, and is experienced in consistency evaluation. In order to cope with the consistency evaluation dividend, the company has made various preparations: 1) the number of personnel expanded by more than 120 people in 2015, an increase of about 40%; 2) a consistency evaluation center was set up at the end of 2015, and more than 10 drug evaluation research work is progressing smoothly; 3) actively upgrading SPF animal rooms and plans to apply for GLP certification to carry out pre-clinical animal experimental research. Profit forecasting and investment advice. EPS is expected to be 0.09 yuan, 0.55 yuan, and 1.11 yuan respectively in 2016-2018, corresponding to the current PE stock price, which is 476 times, 75 times, and 37 times, respectively. Considering that the CRO industry in which the company is located is highly prosperous under the new pharmaceutical policy and that the company is the most flexible target for consistent evaluation, although short-term valuations are expensive, the company has good long-term trends and plenty of room, and maintains a “buy” rating. Risk warning: Risk of policy liberalization of clinical trial institutions falling short of expectations; risk that the country's implementation of the consistency evaluation work will fall short of expectations; lack of standardized implementation of clinical trial data after clinical trial standards are raised or risk of leading to CFDA review.