Where is the way out of collecting and losing bids, laying off workers, and seeking the transformation of innovative drugs?

Author:Since the outbreak began in 2020, some pharmaceutical companies have been forced to announce pay cuts and layoffs in order to ease financial pressuresin addition to this, traditional generic pharmaceutical enterprises are affected by the band procurement policy, but also choose to "open the door" to pharmaceutical sales staff, which includes "once white horse shares" Xin Litairecently, Weibo revealed that the Xinlitai product line hydrogen sulphate chlorpidogdo tablets (product name: Taijia) lay off staff, compensation scheme for n1Although the news has not been confirmed, it is reasonable if it doesbecause in September 2019, the "4 plus 7" city drug centralized procurement pilot expansion, due to the highest quotation, resulting in the core product Taijia did not win the bid, not only lost 70% of the domestic market share, but also means that the company's sales and research and development staff will be reducedin fact, The company has cut 442 sales staff in the past year, down 21% year-on-year, The poor performance of Sinlitai is also the main reason for the layoffsin 2019, the company achieved total revenue of RMB4.47 billion, down 3.9% YoY, and realized net profit of RMB715 million, a significant decrease of 50.95% YoYaffected by the outbreak of new coronapneumonia, hospital outpatient volume and product hospital access have been affected, resulting in the first quarter of 2020 continued the trend, achieving revenue of 866 million yuan, a decrease of 27.13% YoY, net profit of only 150 million yuan, down 53.33% YoY's share price has been falling since the start of the "trade war"Today, combined with a combination of closing stake, declining performance and outbreaks, the decline has been nearly 60% from a peak of $45.02 in May 2018thus shows that the production procurement policy on the traditional generic drug enterprises are still very lethalreview the past operating performance of Xinlitai, it is not difficult to find that once also a high-quality white horse sharesSince going public in 2009, Sinlitai has returned more than 20% of its net assets for 10 consecutive years, roe 10%-15%, for general companies, ROE 15%-20%, outstanding company, ROE 20%-30%, excellent companyThere is no denying that Xinlitai is indeed an excellent company , Xinlitai has always had a tradition of "big bonuses" the last three years, the company's cash dividend stake in net profit was 57.64%, 57.39% and 72.34%, respectively Especially in 2019, even in the face of a sharp decline in performance, a large dividend of $517 million was made If you add a $63.12 million buyback, the combined share of net profit will increase significantly to 81.17 percent It can be seen that the proportion of dividends is quite high However, as 2020 continues to fall sharply and as the company struggles to transition to an innovative drug, there is a lot of money behind it it remains to be seen whether this year will maintain the tradition of high dividends Xinlitai's main business involves the research and development, production and sale of pharmaceutical and medical device products, and the main products and research projects include cardiovascular drugs and medical devices, cephalosporine antibiotics and raw materials, bone absorption inhibitor drugs At present, in order to successfully transform innovative drugs, including East China Pharmaceuticals, a number of pharmaceutical companies have "stopped" some of the low-barrier, low commercial value of generic drugs Hengrui Pharmaceutical Sun Flutter also publicly stated that "only innovative drugs and high-end generic drugs with core values." similarly, Sinlita also disclosed in its 2019 earnings report that "innovative and patented products or high-threshold generics ,such as biosimilars, will be the flagship products of future businesses" That means it is determined to move in both the direction of innovative drugs or high-end generics after several years of continuous rapid research and development investment, the company has completed the layout of the cardiovascular field as the core, to anti-tumor, blood sugar, orthopaedics, anti-infection and other focus areas to expand the extension, innovative product echelon has gradually formed image source: Insight database (https://db.dxy.cn) Currently, only one 1.1 innovative drug, Alitanestine, is on the market for treatment of mild, moderate primary hypertension, included in the health care negotiations in 2017, renewed the health insurance catalog in 2019 at a price below the average decline in access to drugs, and there are no indication saccharides in health care payments According to the Database of Ameida Sample Public Hospitals, Alisatanest sold a total of 200,000 in 2015, 3.6 million in 2017 after being added to the Health Insurance Catalog, and $141 million in 2019, but the market share was only 1.40% This is mainly due to the fact that in the field of antihypertensive drugs, the ground level/satan class is the main however, most of the company's promotion resources are now concentrated in Xinlitan, after all, its importance is Taijia these generic drugs can not be compared, the follow-up is expected to quickly release in addition to this, Xinlitai also has a lot of second- and third-line products to be supplemented in addition to Tyga, Xinlitan, the company used to treat osteoporosis of the Triparta peptide "stick." April 12, 2019, The Triparpeptide Injection Phase 3 clinical (Class 15 Registered, Short-Actuate Needle Preparation) of Sinlitate was accepted by CDE On September 29, 2019, the restructuring of Tripa peptides was approved by the State Drug Administration, becoming the second domesticapproved enterprise (the first approved domestic enterprise is Shanghai United Searle) From the pricing point of view, The retail price of Xinlitai is 96 yuan / bottle, and Shanghai United Searle's domestic minimum winning bid price of 202.93 yuan / bottle, no doubt the former has a price advantage March 25, 2020, as The first biological product of Sinlitai, injection recombinant Tripartatin (Xin Futai) went on sale, filling the company's gap in orthopaedics in addition to , insight databases show that Phase III clinical trials are currently under way in phase III of the long-acting powder-injection form of TheLita recombinant Tripapeptide once a week If the follow-up can be successfully launched, will undoubtedly be able to significantly increase the company's market share in the field of orthopaedics data show that the injection of tripapeptide (frozen powder needle, the commodity name Futaio), is the original research manufacturer Lilly developed in the field of osteoporosis treatment of heavy drugs, is currently the only FDA approved to promote bone formation of the drug sales have continued to sell since it was approved for sale in the United States in 2002 Global sales exceeded $1.6 billion in 2018 and $1.4 billion in 2019 also, in the field of orthopaedics, Sinlita currently has ibuprofen tablets and injections of parmesan disodium two musculoskeletal systems on the market we take a look at Thexaelectric's current product development pipeline: by the end of 2019, Sinlita has 39 chemical research projects and 14 biopharmaceutical research projects covering cardiovascular and cerebrovascular, diabetes and complications, anti-tumor and orthopaedics Source: Company Financial Report From the progress of drug research and development, 3 innovative (chemical drugs) entered the clinical stage, of which 2 are in clinical I and 1 into Phase III Of the innovations (biologics), only 2 are in Phase I In terms of biosimilars, 2 are in phase I and 1 is in phase II image source: Insight Database (https://db.dxy.cn) combing the current phase 3 clinically active products in 2020: a new class 1 drug for the treatment of type 2 diabetes, a new class 1 drug, S086, a biosimilar drug, a long-acting tripartatin, a cancer-induced cancer from EB virus, and Enaro products purchased from Japan Among them, Fugretin is likely to go public in the past two years Several other products are listed for sale in 2021 from the overall point of view, the current Xinlitai's new drug research and development pipeline is relatively rich, many key products have also entered phase III clinical However, it is well known that the development of a new drug requires a lot of human, material and financial resources, and it takes an average of more than 10 years from the time the drug is discovered to its final launch If in the short term, Xinlitai can not guarantee that every year there is a new drug on the market, then the follow-up performance will be difficult to maintain sound, no doubt to give management a very large operating pressure 2019, Xinlitai's investment in research and development fell 3.39% year-on-year to 777 million yuan, and research and development personnel decreased by 5.75% year-on-year In addition, the amount of capitalization of research and development investment decreased by 48.49% compared with the same period last year, mainly due to the acquisition of Yalon Biotech development expenditure of RMB 195 million in the previous period it can be seen that Xinlitai wants to quickly realize the transformation of innovative drugs, can be said to be "a long way to go" So, if Xinlitai wants to achieve a return to value, where is the "breakthrough" of the future? from the product structure, the company currently has preparations, raw materials and medical devices three business sectors In addition to the above-mentioned high-end generic sumetals in preparations, innovative drug transformation, RAW materials and medical devices may become two major "breakthroughs" breakthrough one: API business due to the impact of the band procurement policy, the future pharmaceutical companies will pay more attention to cost control As a result, API has become a "must-have place" for generic companies 2018 and 2019, Xinlitai's API business achieved revenue of 745 million yuan and 613 million yuan, respectively, accounting for 16.02 percent and 13.72 percent of revenue, respectively At present, Xinlitai has a total of 16 API approval numbers breakthrough two: medical device business the same industry, Lepu Medical has also lost the bid in the collection However, the product structure is more balanced because the company's revenue share in the pharmaceutical and medical device slots is almost "five-five-five-open" The impact on the company was not as great as that of Xinlitai, and the share price was quickly boosted and Xinlitai has not given up on the market cake big enough for the medical device plate 2018, sales in the medical device segment of Xinlitai were RMB20.63 million, and in 2019 it will increase to RMB68.81 million, a significant increase of 233.53% YoY in medical devices, the company in recent years continueto to carry out extended expansion Through the acquisition of Suzhou Yanchen's crown vein stent release is obvious, the participating company's Rapamycin drug wash bag, biological intervention flap sac and other device products have also been listed from the medical device research and development program: Maurora cerebrovascular drug elution stent declared for production, in February 2019 to receive NMPA expert review, in March to receive supplementary advice, and in March 2020 to formally submit additional information; by the end of 2019, Yanchen Alpha bracket has completed the bidding and access work in most provinces and cities in the country, with rapid growth throughout the year, with a total of 247 hospitals implanted and sales of more than 100 million This year will also implement the bidding and access work in Jiangsu, Zhejiang, Qinghai, Guangxi and other regions, the calculation of the opportunity to achieve continuous release , it is clear that in the future, Xinlitai is expected to continue to market 1-2 new medical device products per year , from the dividend data, Xinlitai is undoubtedly still an excellent company However, past performance does not represent the future at present, the company is facing a very important innovation drug transformation issue If the follow-up funding and research and development strength can not keep up, it will be difficult to recover in the short term fast-growing performance however, because there are many strength products will be declared listed in the past two years, the company's share price will have a role to play At present, the 20 billion Xinlitai in Taijia and Xinlitan and other core products, supported by the valuation is more reasonable, there is little room for downwards But investors still need to be more rational and not blindly optimistic.