Sansheng pharmaceutical: channel adjustment does not change the leading value

October 24, 2018 / Meitong news agency / -- this is an article written by Mr ah MI, the author of gronhui, as follows: in recent years, domestic Biopharmaceutical Enterprises are favored by the Hong Kong stock exchange, and the listing of Hong Kong stocks has become the general trend Since then, the development of the industry has entered the "fast lane" According to gronhui analysts, the key to measuring pharmaceutical innovation is not the number of projects and R & D expenditure, but whether there is a long-term stable and proven innovation system Among them, Sansheng pharmaceutical is an old star player in the bio pharmaceutical innovation track According to the financial report of the first half of 2018 disclosed by Sansheng Pharmaceutical (1530 HK), the operating revenue was 2.174 billion yuan (RMB), a year-on-year increase of 27.4%; the gross profit was 1.747 billion yuan, a year-on-year increase of 19.9%; the normalized EBITDA was about 838 million yuan, a year-on-year increase of 25.7%; the normalized net profit was 561 million yuan, a year-on-year increase of 37.8%, and the gross profit rate was 80.3%, a year-on-year decrease of 5.1% Although the performance grew steadily, the channel adjusted sales of core yisaipu increased by only 0.9% in the first half of the year, which was significantly lower than the market expectation On that day, the stock price fell sharply in early trading After the communication of management performance and the release of market sentiment, the stock price gradually recovered That's the question How to understand the newspaper? 1、 The value of the system This wave of medical stock market started in the adjustment of the medical insurance catalog in Q1 2017, went through two documents in Q3, stopped in the wave of "drug God" and vaccine events Looking back at the first half of 2018, the most profound impact on the industry may be the reform of Hong Kong stock issuance system, opening up the financing channel of biomedical companies Geli pharmaceutical-b (1672 HK), as the industry's No First of all, it has made a big start However, as a representative of the "thousand people + venture capital" model, it will take time to prove itself in the capital market After the two documents, every pharmaceutical company that goes out of Amway will be called innovation, and every company that has an idea about the stock price will be a hot target, as if suddenly the R & D strength of domestic pharmaceutical companies has reached dozens of big steps, without breath In the industry, there has been a new methodology that innovation is a 100 meter race and innovation is a relay race However, if we really understand the development path of the industry, we know that innovation is a marathon From the screening of project approval, to the promotion of clinical practice, to the communication of supervision, to the enlargement of production, to the marketing, it is a systematic project one by one What is needed is an innovative system It requires the stable operation and close cooperation of the whole system to run out in the innovative arms race It requires long-term and sustained capital investment and long-term team building In the market of these two pharmaceutical innovation stocks, the biggest increase is in the number of traditional big tickets, which are all old-fashioned R & D big factories Innovation is not a treat, but a long-term revolution Therefore, when it comes to pharmaceutical innovation, it's not about the number of projects, R & D expenditure, or a long-term, stable and proven innovation system A proven innovation system is easy to understand, so why emphasize long-term stability? So we have to talk about another problem R & D innovation is not only a highly capital intensive business, but also a highly talent intensive business Without R & D personnel, you can't spend even if the capital is strong enough Without a good R & D leader, no amount of capital is enough to burn Is there a right choice of field varieties? Is the scale of the pipeline well controlled? Is the pipeline layout forward-looking? It's all decided whether the pharmaceutical enterprise can run far and fast in the innovation marathon Whether the company supports innovation is a matter of food and grass, whether the R & D system is good or not is a matter of the military, and whether the R & D leader is strong or not is a general problem Therefore, a leading figure in R & D is an important lifeline of innovation for a pharmaceutical enterprise The stability and instability of the leading figure is the key to the long-term stability of a pharmaceutical enterprise In the industry, there have been many stories of R & D leading big brother flying alone, or competing against each other, or R & D team shuffling, which undoubtedly have a significant impact on pharmaceutical enterprises From the point of view of a selection system, the value of Sansheng as a rare company that has gone through the whole life cycle of Biopharmaceutics in China may not be valued by the market Turning over the development history of Sansheng, we can't go back to the beginning of the story without mentioning the founder of the company: loudan, 1961-1993, who worked in the post Shen Institute of military medicine, in microbiology Immunology, genetics and other professional fields are very accomplished They have won the military science and technology progress award 12 times, but limited to the system of that year, technology transfer can not be transferred, and scientific research results can not be commercialized Finally, in 1993, Sansheng pharmaceutical was founded with friends Among the founders are the current Chairman: Lou Jing (Lou Dan's son) In 1989, Lou Jing went to the United States to study and studied for master's and doctor's degrees in molecular and cell biology at the University of New York Fordham Since 1994, he has carried out postdoctoral research in NIH Later, he led the R & D of tebiao Under his promotion, Sansheng successfully listed on NASDAQ in 2007 and became the first Chinese biopharmaceutical enterprise to IPO in Naxi Most of the time, the gene of the top leader in private enterprises is often the gene of the enterprise Sansheng is an old pharmaceutical enterprise, and the rare one is a pharmaceutical enterprise with serious academic background Reflected in Sansheng's business style, it is relatively stable, continuously growing competitive core products, moderate M & A expansion pipeline, building its own sales team with a high opening mode, and attaching importance to it Control of production quality, etc In early 2017, Dr Zhu Zhenping was introduced as chief scientific officer He is the patent inventor of ramucirumab and necitumumab, and one of the main contributors of cetuximab and olaratumab He has more than 30 years of experience in research and development in the field of therapeutic antibody, including 23 years of experience in research and development and management in the international biopharmaceutical industry The company's research and development team has been further strengthened Generally speaking, the gene of Sansheng's management team is the way of orthodox "American style" pharmaceutical enterprises, which are rare in the old pharmaceutical enterprises without the burden of historical varieties with "Chinese characteristics" At present, in the pipeline sold, three major varieties, tebio, yisepu and yibio, have achieved high market share in the category, proving the company's product commercialization ability There have been no product quality problems for so many years, which proves the company's production quality control ability Such a mature and complete system from R & D to production to sales has a much higher reliability than the all star hot group established by capital The continuous cash flow of mature varieties is the lasting power for R & D Looking at pharmaceutical companies, the pipeline is busy, and the system is the gateway 2、 On February 23, 2017, after eight years of adjustment, the medical insurance catalog was adjusted again The two core varieties of Sansheng Pharmaceutical (tebiao and yisaipu) have entered the medical insurance category B However, the implementation of the new catalog on September 1 has limited impact on the 2017 fiscal year, and the impact in the first half of 2018 is fully reflected Looking back at the company's sales in the first half of 2018, the core product of tebiao, which made a fortune, achieved sales revenue of 841 million yuan, a year-on-year increase of 70.7%, and the market share of sales increased to 63.2% The new medical insurance significantly promoted the growth of tebiao The increase is mainly due to the increase in the number of development hospitals (500 new ones), the supplement of sales personnel (700-800), and the improvement of patient recognition and relevance The management has raised the sales growth guidance of tebiao in 2018 to 50-60% Yisaipu, the new core product of M & A, is also affected by the new medical insurance and has a strong growth According to IMS calculation, the hospital use of yisaipu in the first half of 2018 increased by about 36.9% compared with the same period of 2017, and the market share of Q2 in 2018 has reached 64.9% However, in the first half of the year, sales revenue reached 442 million yuan, an increase of 0.6% year on year It is Q2 financial report yisaipu that is not as expected, which leads to the Waterloo of stock price The company's report revenue is lower than the hospital's use of quantity and fortune This is mainly due to the company's improving business policies, unifying product inventory cycle, reducing yisaipu channel inventory, and reducing its inventory cycle to the same as that of tebiao and Yibiao (adjusted from 3-4 months to 2-3 months) This channel adjustment is only a one-off event without long-term impact In addition, unifying the business policies of large varieties and reducing channel inventory are actually more conservative and stable strategies to squeeze out performance moisture and improve the corresponding speed of the terminal in the long run After the completion of this inventory removal, the management expects that the second half of yisaipu will have a year-on-year growth of about 20%, and about 10% in the whole 18 years Moreover, the third phase test of yisaipu precharge injection has been completed It is expected to apply for production approval in the second half of 2018 After the more convenient precharge injection products are launched, it will help yisaipu to further grow As long as these two new varieties are stable, their performance in the next few years will be basically stable In the first half of 2018, the sales revenue of recombinant human erythropoietin series (ibio and saibor) reached 427 million yuan, an increase of 4.3% year on year Among them, the sales volume of ibio is about 339 million yuan, a year-on-year decrease of about 1.3% Saibor's sales increased to 87 million yuan, up 34.2% year on year In the first half of 2018, the company's market share of erythropoietin series totaled 41.3%, maintaining a leading position in the market The market share of saibor, the second brand, has been further expanded, and the market share has gradually increased from 3.3% in 2013 to 12% in the first half of 2018 This series of varieties maintain the existing market position and single digit growth, which is expected to stabilize the current Taurus business In the new layout of the diabetes sector, it is still in the stage of integrating the sales team and cultivating the market Youbilin has a sales team of 400-500 people, with sales of about 350-400 million yuan in the first half of 2018, basically the same as the sales level in the second half of 2017 GLP-1 baibida and baidayang achieved sales of 78.4 million yuan Baidayang was listed in China on May 25, 2018, the first long-term GLP-1 to enter the domestic market, greatly improving patient compliance Two GLP-1 drugs are mainly used in different markets (baidayang: long-term weekly preparation, convenient, high compliance; baibida: with weight reduction effect) Therefore, in a comprehensive view, the growth rate of tebiao and yisaipu can still maintain more than 20%; the recombinant human erythropoietin series (yibio and saibor) can maintain a low single digit growth; the diabetes sector is a new version of the block that is being cultivated, and there is no significant chain missing old varieties in the whole sales business line, so it is no problem to maintain the medium and short-term upward growth trend This pipeline structure It is very rare in the current old pharmaceutical enterprises The quality of financial disclosure of Sansheng is also relatively high, and the sales force continues to expand As of the first half of the year, Sansheng has about 2727 marketing personnel, 345 distributors and 1561 third party promoters in China, covering more than 2000 level three hospitals and more than 11000 level two or lower level hospitals and medical institutions, covering all provinces, autonomous regions and municipalities in China The company's R & D strategy focuses on innovative biological drugs, followed by small molecules and generic drugs At present, it is still concentrated in oncology, immunology, Nephrology, metabolic diseases and dermatology with channel advantages Looking at the R & D pipeline, there are some old varieties with high probability of success, such as expanding the indications of special Australia and yisaipu