The current situation of the company
On April 16, we participated in Qiming Medical's online Investor Open Day.
Comment
Terminal implantation is still strong in the first quarter, and the approval of second-generation products is expected to enhance clinical competitiveness.
According to the company's official account, in 2020, Qiming Medical completed about 2200 transcatheter aortic valve replacement operations (terminal hospital implant caliber) in China, an increase of more than 50% over 2019; the company's 1Q21 terminal valve implantation volume of about 750cases, maintaining a strong growth momentum compared with the previous year. In addition, the company's TAVR product VenusA-Plus has been approved for listing by the State Drug Administration in November 2020 and has entered more than 40 hospitals. We believe that the epidemic in 2020 will affect the development of clinical terminal surgery and drag down the volume of products, but the approval of second-generation products is expected to promote the clinical implantation of the company's products, and the recyclable function of VenusA-Plus will help to open the bottleneck of doctors' production capacity and enhance the competitiveness of the company's products.
The pulmonary valve is expected to be listed in Europe by the end of this year, and the internationalization strategy continues to advance. According to the company announcement, the company's independently innovative transcatheter artificial pulmonary valve system VenusP-Valve is currently in the final stage of CE certification by the European Drug Regulatory Agency, and the company is expected to be approved and put on the market within 2021. At the same time, according to the announcement, VenusP-Valve has obtained a special license from the FDA to enter the UK market ahead of schedule in March 2021. We believe that the grant of the special license fully confirms the clinical value of the company's innovative product. We believe that the steady progress of the pulmonary valve overseas has also laid a solid foundation for the international layout of Qiming Medical products and contributed to the continuous promotion of the internationalization strategy.
Update a variety of products and technical progress, continue to lead the innovative medical device track. The company announced on February 1st, with Endoluminal Sciences Pty Ltd. The company has reached a cooperation to introduce its valve active periphery leakage prevention technology into China and fully apply it to its new generation of valve products. In addition, the company has realized the application of dry valve technology on the latest generation of TAVR products PowerX and Vitae, and laid out the product pipeline of surgical dry valve, so as to further enrich the product portfolio in the field of heart valve and strengthen clinical competitiveness. We expect that with its rich and complete innovative product pipeline, Qiming Medical is expected to continue to capture the market share in the field of heart valve treatment after taking the lead in the market, and through deep cultivation in the field of innovative medical devices, continue to accumulate and develop into an industry leader in the field of innovative medical devices, it is recommended to pay attention to the company's follow-up clinical and commercial progress in 2021.
Valuation proposal
We keep the revenue forecast for 2021 and 2022 unchanged, the net loss forecast for 2021 and net profit forecast for 2022 remain unchanged. However, considering that the approval of the company's second-generation products may enhance the competitiveness of the clinical terminal, catalyse the long-term steady volume of TAVR products, and the continuous innovation of the product line is expected to contribute more catalysts related to clinical progress in 2021, we have raised the company's target price by 6.3% to HK $85 (based on DCF valuation), which is 34% higher than the latest closing price. Maintain the "outperform industry" rating.
Risk.
The progress of clinical research and development is not as expected; terminal surgery is slow; industry policy risk.