126 pharmaceutical companies mid-term report card! The highest net profit growth rate exceeds 80,000%, and the traditional Chinese medicine sector shines

The mid-term report card of pharmaceutical and biological companies is emerging. According to data disclosed by cninfo.com, as of July 24, 126 A-share pharmaceutical and biological companies have announced their 2021 interim results.

Specifically, 86 companies have predicted performance increases, accounting for nearly 70%. Among them, 54 companies are expected to see a significant increase in performance. The company with the highest net profit growth limit is Rejing Biotech, reaching 81808.47%. The upper limit of net profit growth of three companies, Taiantang, Jinshi Yayao and Harbin Sanlian, also exceeded 1800%. There are 17 companies with net profit growth upper limit in the range of 200%-1000%, 19 companies in the 100%-200% range, 15 companies including Harbin Pharmaceutical Co., Ltd., CanSino, Weiming Pharmaceutical, Dong'e Ejiao, etc. It is expected to turn a loss into a profit compared with the same period last year.

It is worth noting that there are still 15 companies with expected performance declines, among which the net profits of five companies, Haixiang Pharmaceutical, Yuheng Pharmaceutical, Baotailai, Yifan Pharmaceutical, and Jiu'an Medical The lower limit of the decline is more than 70%. There are also 17 companies with pre-performance losses. Sihuan Biotech ranked first with a net profit drop of 538.33%, followed by Sano Medical with a net profit drop of 360.02%. Nanhua Biotech, Hainan Haiyao, Guangshengtang and other companies Losses of varying degrees are also expected. In addition, seven companies including Meinian Health, Innovative Medical, Asia Pacific Pharmaceuticals, Zixin Pharmaceuticals, and Tianzhihang are expected to reduce losses.

Chemicals

Restorative market growth boosts performance

Falling API prices hit overseas business

Interim results have been announced so far Among the 126 pharmaceutical and biological companies, 32 companies belong to the chemical pharmaceutical sector, ranking second among the six major sub-sectors. Overall, companies with pre-performance increases accounted for 20 companies. Among them, the net profits of two companies, Harbin Sanlian and Jinshi Yaoyao, have increased astonishingly. However, the reasons driving the performance growth of the two are completely different, which deserves the industry's joint consideration.

In order to broaden its development path in the medical devices and cosmetics sectors, Harbin Sanlian increased its investment in Fuljia Technology with 100% equity of its wholly-owned subsidiary Beixing Pharmaceutical in February this year, acquiring the domestic medical transparency company 5% stake in the market pioneer of sodium hyaluronate facial dressings. This unique foreign investment directly brought 566 million yuan of investment income to Kazakhstan Sanlian, which is obviously the biggest factor causing the change in mid-term performance. When the growth of existing business sectors is sluggish, cross-border investment or mergers and acquisitions have become a common practice for companies to break through the bottleneck of performance growth. Sailong Pharmaceutical, which ranks sixth in net profit growth, also disclosed that the impact of interim non-recurring gains and losses on net profit was approximately 8.8 million yuan, mainly due to the increase in investment income and gains from changes in fair value.

The substantial growth in net profit of Jinshi Yao relies on the performance contribution of its flagship products. Under the COVID-19 epidemic, the public has taken proactive protective measures, including wearing masks and washing hands frequently, which has led to a sharp decrease in the frequency of colds. The market demand for cold medicines has been significantly reduced, and product sales have declined severely. However, since this year, the cold medicine market has gradually recovered. In addition, due to last year's cold medicine purchase restriction policy, concerns about the inconvenience of purchasing medicines have also made the public interested in hoarding a certain amount of cold medicines. At the same time, the significant recovery in market demand has also allowed downstream dealers and chain pharmacies to increase their stockings. This has boosted the sales of Jinshi Yao's "Quike" brand adult cold medicine and "Xiao Kuike" brand children's cold medicine. Revenue increased significantly compared with the same period last year.

With the domestic epidemic under effective control, the production and sales of enterprises have continued as usual. In addition to Jinshi Yaoyao, the sales of major products of Guangji Pharmaceutical, Kelun Pharmaceutical and other companies have also shown recovery growth, thus in Last year, we achieved substantial year-on-year growth on a low base. However, while some pharmaceutical companies are regaining market certainty, they are also exploring more possibilities. For example, Zhendong Pharmaceutical is gradually moving into the third terminal, Jiuzhou Pharmaceutical is continuing to expand its CDMO business segment, Huaren Pharmaceutical is improving sales channels and exploring incremental markets, etc. On the other side of the coin, five pharmaceutical companies including Yifan Pharmaceuticals and Tianyu Pharmaceuticals, whose prices of APIs and overseas business profits have dropped, and Yongan Pharmaceuticals, whose main product taurine profits have dropped, have experienced performance dives, with net profits falling by more than 50%. %; while Hainan Haiyao, whose investment income has declined, and five pharmaceutical companies, including Guangshengtang, Frontier Biotech, and Zejing Pharmaceutical, which have continued to increase their R&D investment, have forecast performance losses.

Traditional Chinese Medicine

Spin off pharmaceutical e-commerce, investment profit exceeds 700 million

Non-main business brings top two growth in net profit

Series Favorable policies have given a boost to the traditional Chinese medicine sector, ushering in a bright future. Among the 20 traditional Chinese medicine companies that have announced interim results, 14 companies have predicted an increase in performance. Among them, 12 pharmaceutical companies such as Taiantang, Taiji Group, and Qizheng Tibetan Medicine have experienced significant increases in performance. And if we include Jiaying Pharmaceutical, Dong'e Ejiao, Longshen Rongfa and Longjin Pharmaceutical, four pharmaceutical companies that have turned losses into profits, the traditional Chinese medicine sector can be said to be in full bloom, with 90% of companies achieving year-on-year growth in performance, leading the way with outstanding performance The entire pharmaceutical and biological sector.

Looking through this list of the TOP 10 net profit increases in the mid-term performance forecast of the traditional Chinese medicine sector, the first thing that catches the eye is Taiantang, which has a net profit of more than 500 million yuan and a year-on-year increase of nearly 20 times. However, the reason for such a huge change in Taiantang's performance is extremely simple and clear: the transfer of 47.35% of the equity in subsidiary Kang Aiduo. For this transaction, Taiantang stated that it was to obtain cash quickly and ease the operating capital pressure of listed companies. By selling its pharmaceutical e-commerce business, it is expected to receive a cash payment consideration of 748 million yuan. With the online sales of prescription drugs approaching, it seems untimely for Taiantang to divest its pharmaceutical e-commerce sector. Whether the funds to be withdrawn can alleviate its liquidity pressure remains to be seen. The proprietary Chinese medicine manufacturing business that dominates the market may cause it to face new performance challenge.

Qizheng Tibetan Medicine, which has a net profit growth limit of more than 1 billion yuan, also stands out in this list. Similar to pharmaceutical companies such as Harbin Sanlian and Sailong Pharmaceutical in the chemical pharmaceutical sector, Qizheng Tibetan Medicine's net profit contribution also comes from external investment income. In June of this year, Bai Yang Pharmaceutical, a health brand commercialization platform that Qizheng Tibetan Medicine indirectly holds shares through participating in the establishment of a merger and acquisition fund, officially landed on the GEM. After accounting, this investment will increase Qizheng Tibetan Medicine’s net profit for the first half of 2021 by more than 700 million yuan in accordance with the agreement. However, high returns on investment are always accompanied by high risks. Yunnan Baiyao, the leading traditional Chinese medicine leader, has experienced a 40% decline in net profit in the first quarter of this year due to stock speculation. Qizheng Tibetan Medicine also reminded in its performance forecast that this investment will cause its There are certain fluctuations in performance.

Comparing the reasons for the performance changes of Taiantang and Qizheng Tibetan Medicine, Chinese medicine companies that focus on their main business and deepen their industry are obviously more pragmatic. Taiji Group, which ranked second in net profit growth, said that its performance was mainly affected by its main business, because it focused on the development of its main business, implemented its main product strategy, increased its sales of large-scale products, and drove the sales growth of other products. Both sales revenue and gross profit have achieved growth; Zuoli Pharmaceutical, which adheres to the marketing strategy of "stable self-operation and strong investment attraction", strengthens market investment and the development and coverage of terminal medical institutions, and its core products Wuling series and Bailing Tablets Sales revenue shows a steady growth trend; Dong'e Ejiao, which is expected to turn around losses, will achieve healthy market growth with new growth logic through firm digital transformation, enriching its product matrix.

Biological products

The overall performance is mixed

There are abundant pipelines, and there are worries about entering medical insurance

When small molecule chemicals are the scientific tree All the low-hanging fruits have been picked, and the field of macromolecular biopharmaceuticals has become a new track that pharmaceutical companies have entered in recent years. Among the 18 biopharmaceutical companies that have announced interim performance forecasts, almost half of the companies have forecast increases and forecasts of decreases in performance. Together with CanSino, Weiming Pharmaceutical and Shuangcheng Pharmaceutical, three pharmaceutical companies that are expected to turn around, they just complete the list of the top 10 net profit increases.

Specifically, Pailin Biotech ranks first with a net profit growth limit of 200%. The main reason for the substantial increase in performance is due to its continuous promotion of operational changes, both endogenous and external. While continuously optimizing the product sales structure and actively adjusting product sales strategies, the effects of Pailin Biotech's expansion have also begun to show: the strategic cooperation with Xinjiang Deyuan Biopharmaceuticals has contributed to a significant increase in its financial income year-on-year; the completion of Harbin Pailin Biopharmaceuticals The strategic reorganization of the company and becoming its wholly-owned subsidiary is also further boosting the overall performance growth of Pailin Biotechnology.

Anke Biotechnology, which continues to strengthen its marketing efforts and improve sales channels, has also achieved substantial year-on-year growth in its main product, recombinant human growth hormone products, thus driving the growth of its consolidated net profit indicators. From the perspective of the industry, with the recent approval of new indications for injectable human growth hormone, Anke Biotech will continue to be the main profit point in the future. However, the news that the super centralized purchasing alliance led by Guangdong plans to include recombinant human growth hormone once lowered the stock prices of Changchun High-tech, Anke Biotech and other related companies. Will this unresolved challenge bring greater losses to Anke Biotech? The performance impact remains to be seen later.

Based on the characteristics of high technical risks, long R&D cycle, and large capital investment inherent in R&D in the biomedical field, Biota has a rich pipeline of biopharmaceutical products. However, Biota, which only has adalimumab on the market, still gives The judgment of pre-performance loss was made. Sansheng Guojian, which gave the same performance forecast, believes that with the combined effects of factors such as an increase in the number of competing products included in medical insurance and price reductions of competing products, its key product Yisaipu will face intensified market competition. There are risks such as uncertainty in the performance of Septin after it enters the medical insurance directory.

Medical devices

Explosive growth in foreign trade orders

Volume purchasing of consumables shows its power

The medical device field is currently disclosing its mid-term performance forecast The main force, the number of companies is as many as 39, and it is also the segment that produces companies with the highest net profit and net profit growth respectively.

Overall, including Leadman and Toujing Life, two companies that are expected to turn around, there are 28 companies including Rejing Biotechnology, Haohai Biotech, and Jiuqiang Biotech that have achieved positive growth in performance, with a proportion of More than 70%; there are still 10 companies such as Sano Medical, Jiu'an Medical, and Biolite, which have predicted a sharp decline in performance or preempted or reduced losses.

Among them, Rejing Biotech leads the pack with the highest expected profit growth of 81808.47%. Affected by the continued development of the COVID-19 epidemic in Europe and around the world in the first half of the year, Rejing Biotech's foreign trade orders for its two new coronavirus antigen rapid detection reagent products experienced explosive growth, prompting a substantial increase in its operating performance in the first half of the year and ultimately resulting in an increase in net profit. Over 80,000% gratifying results. Coincidentally, Oriental Biotechnology, which has a net profit increase limit of more than 500% and a growth limit of 3.53 billion yuan, also relies on its new coronavirus antigen rapid detection test strips (colloidal gold) to continue to invest in the global new crown epidemic prevention and control cause.

In addition to the factors that contributed to the explosive growth in performance due to overseas anti-epidemic efforts, the recovery of domestic market demand and the proactive adjustment of business strategies by companies are also the main reasons. Haohai Biotech, Aojing Medical, Leadman , Huitai Medical, etc. are all continuing to carry out various marketing and marketing activities to expand brand awareness and influence in order to achieve a greater increase in product sales; in terms of innovation, Dean Diagnostics is determined to provide integrated medical diagnosis solutions The unique competitive advantage of the solution is to vigorously promote the special inspection business based on precision centers and the general inspection business with value-added cooperation. Wondfo Biotech is in compliance with the industry trend of disease types and application scenarios as business drivers. The domestic marketing division has been organizationally reformed, and the coordinated development of various business lines has been driven by personnel integration and channel reuse.

As the price and volume of protective products return to normal at this stage, compared with the same period last year due to the surge in demand for anti-epidemic materials, the sales revenue and profit base were larger. Jiu'an Medical, Ogilvy Medical, and Yangpu Medical Other companies have given warnings of sharp declines in performance. In addition, the volume-based purchasing policy coming from the pharmaceutical field is subverting the competitive landscape of high-value consumables. Due to the failure to win the nationally procured coronary stent, Sano Medical's product sales dropped significantly by 85.61% compared with the same period last year, and revenue decreased by 124 million yuan, a year-on-year decrease of 90.01%. When explaining the main reason for the decline in net profit, Sano Medical said that due to the sharp decline in sales of coronary stent products, the scale effect of its production products was reduced, and product production costs failed to decrease in the same proportion.

Conclusion