The company issued an announcement: The company's application for bupivacaine liposome marketing was approved by the FDA. This is the first generic drug approved in the US since the original product was marketed in the US in 2011. Bupivacaine liposomes use advanced polycystic liposome delivery technology to achieve long-term analgesia through slow release and effectively improve patients' quality of life. Global sales of bupivacaine liposomes reached $538 million in 2023, with large market space and a good competitive landscape. According to the Drug website, the sales price of the bupivacaine liposome “266 mg/20 mL” specification in the US is 397 US dollars/bottle, and the domestic online price for products with the same specification is 382 yuan/stick.
Internationalization is accelerating, and overseas sales revenue and share are expected to increase profits. The company adheres to an international strategy: (1) In terms of generic drugs, the company continues to promote the registration, approval and sale of key products in the European, American, and Japanese markets. According to the company's official website, since Irinotecan was approved in the US in 2011, the company has obtained about 20 approvals in the European, American, and Japanese markets. (2) In terms of innovative drugs, according to the company's annual report, the company reached 5 external licensing transactions in 23, with a total transaction amount exceeding 4 billion US dollars; in May '24, the company obtained overseas licensing for the GLP-1 innovative drug portfolio, and the total amount of the agreement exceeded 6 billion US dollars.
Domestic new drug leaders are optimistic that innovation will drive the long-term development of the company. According to the company's official website, the company has now launched 16 new Class 1 drugs and 4 new Class 2 drugs. The revenue of new drugs reached 10.637 billion yuan in 23 years. The company's product structure has improved rapidly, and the share of new drug revenue has continued to rise. The company has abundant reserves in the research pipeline. More than 90 self-developed new drugs are in the clinical development stage. Among them, JAK1, IL-17A, PCSK9, etc. are in the marketing application stage, and HER2 ADC, URAT1, PD-L1/TGF-beta are in phase III clinical stage. These products are expected to drive rapid growth in the company's performance after launch.
Profit forecasting and investment advice. We expect the company's 2024-2026 EPS to be 0.84, 0.96, and 1.09 yuan/share, respectively. The company's innovation ushered in a good harvest, and the internationalization process accelerated. Considering the company's leading position in the domestic pharmaceutical industry, referring to comparable company valuations, the company was given a PE valuation of 60 times in 2024, corresponding to a reasonable value of 50.48 yuan/share, maintaining a “buy” rating.
Risk warning. There is a risk that clinical development of new drugs will fail, the amount of innovative drugs released is lower than expected, the progress and results of overseas research and development are lower than expected, and the price reduction in collection exceeds expectations.