Key points of investment
Pharmaceutical CRO based on the rapid growth of China and the US: The company is a rapidly growing contract research organization (CRO) that provides integrated, science-driven research, analysis and development services throughout the drug discovery and development process to help pharmaceutical companies achieve drug development goals. The company has operations in both the US and China (two major markets served by global contract research institutes). In 2017, the company's revenue in the US was US$48.61 million, an increase of 17.2% over the previous year; it achieved revenue of US$21.64 million in China, an increase of 201.4% over the previous year.
The specialized division of labor is driving the flourishing development of the pharmaceutical outsourcing industry in China and the US: the global pharmaceutical market grew steadily. The size of the global pharmaceutical market was 1,209 billion US dollars in terms of revenue in 2017, and is expected to increase to 1,596.6 billion US dollars in 2022. The compound annual growth rate for this period was 5.7%. Meanwhile, China and the US are the world's largest pharmaceutical markets, accounting for 17.5% and 38.3% respectively. As specialized division of labor becomes an inevitable trend in the development of the pharmaceutical industry, pharmaceutical CRO can help pharmaceutical companies accelerate project schedules, control risks, optimize resources, and reduce costs through specialization and economies of scale, so that they can flourish, especially in the two major pharmaceutical markets of China and the US. The development of this company has brought opportunities. In particular, the generic drug consistency evaluation currently being promoted by China has spawned an urgent need for CRO due to its high demand and tight time.
Risk warning: Outsourcing trends in the industry fall short of expectations, contract performance falls short of expectations, capacity expansion may fall short of expectations, exchange rate fluctuations, Sino-US trade relations, etc.