Incidents:
Osecon issued an announcement stating that it intends to purchase 60% of the shares of Jiangsu Weidekang Medical Technology Co., Ltd. by issuing shares and paying cash. The transaction price of 100% of the target company's shares is 1.39 billion yuan, and the transaction price of the corresponding underlying assets is 834 million yuan.
Key points of investment:
The merger and acquisition of digestive endoscopy companies will increase profits of more than 100 million yuan per year in the future. Jiangsu Weidekang is a high-tech enterprise focusing on R&D, production and sales of endoscopic interventional diagnostic and treatment devices. It has two brand series products, “Jiuhong” and “Weidekang”. The endoscopic interventional diagnosis and treatment device industry has high market popularity and brand influence. Weidekang's net profit deducted from non-homologous mothers in consolidated gambling statements is not less than 364 million yuan. The details are as follows: The net profit deducted from non-homologous mothers from 2021 to 2023 was not less than 100 million yuan, 120 million yuan and 144 million yuan respectively.
Add the layout of the medical device field, create an integrated pharmaceutical device collaboration plan, and enhance competitiveness in the digestive field. Osecon focuses on anti-digestive ulcer, anti-tumor, anti-drug-resistant bacterial infections, chronic diseases, etc., and is a leader in the field of PPO inhibitor injection products in China. After more than 20 years of intensive work, the company has formed a multi-category, multi-level product pipeline and a good product quality reputation. After this merger and acquisition of Jiangsu Weidekang, the company will inject high-quality medical device assets, use its advantages in the pharmaceutical field to promote the integration and sharing of relevant high-quality medical resources, give full play to synergies, and continuously enhance profitability and enhance overall competitiveness.
PPI leaders continue to expand multiple product lines and enter a period of accelerated growth. As a leading PPI inhibitor, the company continues to consolidate its PPI product line. Injectable dexabeprazole sodium (first in China) and injectable levapantoprazole sodium (second in China) are expected to be approved for listing this year. Injectable dexlansoprazole sodium has been notified of acceptance. Furthermore, the company is gradually expanding treatment fields such as digestion, infections, tumors, chronic diseases, etc., and injectable temozolomide has recently been approved. Posaconazole enteric tablets are expected to be approved in the near future, and injectable posaconazole sodium and polymyxin E for injection are also expected to be approved in the first half of the year Listed, anti-tumor cabotinib has been accepted. Additionally, Pemex, which has been on the market for the past two years Trexdisodium (tumors), saglitatin tablets (diabetes), injectable tigacycline (anti-infection), and injectable parecicib sodium (anesthetic analgesia) have already begun to contribute to sales. We expect the company's revenue share for new product lines such as infections, tumors, and chronic diseases to rise to around 30% in 2020;
Combining innovation at the beginning and end, improving the research system drives us into a full harvest period of transformation and upgrading. In recent years, the company's research institutes have, on the one hand, improved the leading innovation system, and on the other hand, strengthened the integration of API formulations and the consistent evaluation of generic drug quality. Osecon's innovative drug pipeline continues to be expanded. The company's introduction of the third-generation EGFR-TKI drug, ASK120067, is in clinical IIb stage. It is expected to be marketed in the first half of next year. It is expected to be marketed in the first half of next year. In addition, phase 1 clinical trials targeting Claudin 18.2, the anti-tumor drug ASKB589, are being developed in an orderly manner; in terms of external cooperation, the company's introduction of the next-generation oral ferroiron drug maltol capsule for the treatment of iron deficiency in adults has been approved for IND, and subsequent clinical bridging has been completed. The experiment can then be declared for listing. In the future, we expect an average of 3-4 innovative drugs to enter clinical trials every year. This year will be the first year in which the results of the innovative drug pipeline of the company's research institutes are realized.
Profit forecast and investment rating: In the short term, as a leading domestic proton pump inhibitor company, the company does not consider the profit balance from mergers and acquisitions. The business is partially affected by the acquisition. We lower our profit forecast. We expect the company's EPS for 2021-2023 to be 0.79, 0.86, and 1.01 yuan respectively. Corresponding to the current stock price PE is 18.24, 16.57, and 14.24 times respectively. In the long term, we are firmly optimistic about the comprehensive innovation and upgrading driven by the company's perfect research system, and will still maintain the purchase rating.
Risk warning: Innovative drugs fell short of expectations, collection pressure was greater than expected, other risks.
