Event
On October 30, 2023, the company announced that revenue in the first three quarters of 2023 was 291 million yuan, an increase of 11.82% over the same period last year. The revenue in the third quarter of 2023 was 117 million yuan, an increase of 26.33% over the same period last year, and the non-net profit was 0.15 million yuan. The performance is in line with expectations.
Comment
Focus on polypeptide APIs and preparations, 8 core technologies support R & D and promotion. (1) API:
The company's polypeptide API varieties are all generic drugs, and at present, it has mastered the large-scale production technology of 16 varieties, among which enfurovitide and carbetocin are the first imitation varieties in China. Preparation:
The company has large-scale production capacity of peptide APIs, reliable quality, good stability and other advantages. Nine varieties of polypeptide preparations have been sold in 31 provinces, autonomous regions and municipalities directly under the Central Government, covering areas where polypeptide drugs play an important role in immune system diseases, tumors, cardiovascular diseases, chronic hepatitis B, diabetes and obstetrical diseases. Innovative Pharmaceutical Research Service Project:
The number ranks first in China, of which 1 variety has been approved for listing and 7 varieties have entered the stage of clinical trial. (2) Core technology and project reserve: at present, the company has 8 core technologies, 11 projects have been declared for approval, and 19 medium-and long-term reserve projects are under development, of which Lilarutide has been notified of clinical approval. Posaconazole, Isenazeptide, cetralek and other varieties are subject to review and approval by the Drug examination Center of the State Drug Administration.
Capacity expansion to ensure revenue growth, the patent period is expected to further open the polypeptide market space. (1) according to the announcement on July 7, the total amount of funds raised by the company from no more than 35 (including 35) specific targets does not exceed 160 million yuan, of which the total investment of polypeptide innovative drug CDMO and API industrialization project is 204 million yuan, and the proposed fund-raising is 130 million yuan. The funds raised will be used to upgrade production capacity to meet the market demand for the mass production of the company's products. At the same time, the company will increase the production capacity of API products with large market capacity, such as thymopentin, bivalirudin and Atosiban acetate, in order to meet the market demand for batch production of the company's products. to provide a guarantee for the continuous growth of the company's polypeptide API business income. (2) Peptide drugs have the characteristics of high activity, low dose and low toxicity. 2014-22 is the peak period of the gradual expiration of blockbuster variety patents, among the varieties that have not yet been listed in China or only imported original research drugs, including Glatere, Lilarutide, Essenapeptide, Gosserrelin, etc., the same variety of products of imitation pharmaceutical companies are expected to submit applications for listing in succession in the future, and the market space is expected to expand.
Earnings forecast, valuation and rating
We estimate that the company's annual revenue in 2023-24-25 will be RMB 4.41 million, an increase of 11%, an increase of 9%, and a net profit of 0.65%, 0.71%, and an increase of 1%, 8%, 11%. Maintain the "overweight" rating.
Risk hint
Risks such as failure of R & D, failure of consistency evaluation, price increase of raw materials, intensification of market competition, reduction of shareholders and so on.