Main points of investment
Revenue regulation model increased significantly: the company achieved operating income of 56.15 million yuan (the same below) in 2021, an increase of 328.73% over the same period last year, mainly due to a significant increase in sales of the company's ophthalmic products (Oqin, bromonidine tartrate eye drops, OT-401 and Kangshu), as well as an increase in sales-based royalties related to Emmetine and Bateshu. The company's net loss in 2021 was 260 million yuan, which was significantly lower than that of 2.265 billion yuan in the same period last year, mainly due to an one-time fair value change loss of 1.695 billion yuan in 2020. After adjusting for changes in the fair value of financial liabilities, share-based payment expenses, and gains related to EyePoint and Alimera transactions, the adjusted net loss in 2021 was 187 million yuan, down 32.42% from the same period last year. On the cost side, sales and marketing expenditure, adjusted R & D expenditure and administrative expenses in the first half of 2021 were 128 million yuan, 455 million yuan and 126 million yuan respectively, representing year-on-year changes of 151.63%, 27.94% and-45.79%, respectively. The company's 2021 gross profit margin was 65.78%, a decrease of 20.86pct compared with the same period last year, mainly due to an increase in the cost of sales of Oqin, OT-401 and Kangshu and franchise amortization.
The results of commercial construction are beginning to appear, and the sales scale has entered a stage of rapid growth: the company currently has six types of commercial ophthalmology products, including OT-401 (pilot sale), bromonidine, Oqin, Emmetine, Beitsu and Kangshu, with a total terminal sales of about 90 million yuan, an increase of 466.53% over the same period last year. The company's goal is to become an ophthalmology Pharma, continuously accelerate the layout of commercial products, acquire the Chinese rights and interests of Emmetine and Bateshu in August 2021, and acquire the Chinese hospital sales rights of Shilida and Celica in March 2022. At the same time, the company is also strengthening the construction of commercialization capacity. In 2021, a commercialization system of the whole industry chain covering the whole country has been initially established. The company has completed the coverage of 1024 hospitals in the country, including 59 tertiary hospitals.
The establishment of a comprehensive ophthalmic drug in the research pipeline, OT-401 approval is imminent. Through self-research and Becton Dickinson & Co's continuous enrichment of the R & D pipeline, the company has 20 kinds of drug assets and has established a comprehensive ophthalmic drug pipeline, covering all major anterior and posterior eye diseases. The company has 6 drug candidates in clinical phase III trials, and is one of the innovative pharmaceutical companies with the largest number of ophthalmic drugs entering phase III clinical trials in China. Among them, OT-401 is the first drug in Chinese pharmaceutical history to be listed entirely on the basis of real-world data, and it is also the company's core product, which is expected to be approved soon; atropine eye drops OT-101 will continue to promote the enrollment of MRCT patients and real-world research patients in 2022.
Profit forecast and valuation: the approval of the company's OT-401 was delayed by the epidemic, and we lowered our revenue forecast to 226 million yuan, 498 million yuan and 791 million yuan in 2022-2024, an increase of 302.72%, 120.39% and 58.79% over the same period last year, and reduced the 2022-2024 net profit to-2.28,1.10 and 15 million yuan.
Lower the company's target price of HK $12.95 and maintain a "prudent overweight" rating.
Risk hints: the sales of OT-401 are not as expected after listing, the progress and sales of products under research are not as expected, and the third party depends on risk.