\u3000\u3 Shengda Resources Co.Ltd(000603) 392 Beijing Wantai Biological Pharmacy Enterprise Co.Ltd(603392) )
Key investment points
Beijing Wantai Biological Pharmacy Enterprise Co.Ltd(603392) : from competitive varieties to potentially optimal vaccine platform
Since the company launched the world’s first listed hepatitis E vaccine in 2012 and the world’s fourth successfully listed HPV bivalent vaccine at the end of 2019, the sales of core varieties have continued to exceed expectations. From the perspective of growth drive, we believe that the company’s short-term and medium-term revenue growth comes from the improvement of HPV vaccination rate, the medium-term and long-term growth comes from the connection of new varieties such as varicella vaccine, the long-term competitiveness comes from the vaccine design of structural biology and efficient gene engineering recombinant antigen expression system, and there is more room for innovative vaccine R & D and IVD business. Specifically:
① in the short and medium term (20212025), we estimate that the comprehensive vaccination rate of HPV vaccine in China will be 6.5-7% in 2021. Considering that the vaccination rate is in the window period of rapid improvement, we assume that the comprehensive vaccination rate will reach about 30% in 2025 (corresponding to 45-50 billion yuan) Beijing Wantai Biological Pharmacy Enterprise Co.Ltd(603392) China’s HPV vaccine market share is about 35% (mainly HPV bivalent vaccine, including a small amount of HPV nine valent vaccine. Assuming that the market share takes into account the rhythm of newly listed HPV vaccine and the company’s production capacity, the company’s HPV vaccine revenue will increase by 40% from 2021 to 2025.
② in the medium and long term (20252030), we expect that after chickenpox vaccine (attenuated chickenpox vaccine + innovative chickenpox vaccine) and HPV nine price vaccine are successively listed, the vaccine variety echelon is expected to be more abundant, and the company’s existing technical reserves of rotavirus vaccine and RSV vaccine are expected to make new breakthroughs. In the long run, based on the advantages of front-end technical capability + back-end commercialization capability, we are optimistic about the potential of the company to become a potential first-class vaccine platform. Considering the new momentum of business development brought by the company’s continuous deep cultivation in the field of chemiluminescence, we are optimistic that the company will become a platform innovation company across IVD and vaccine sectors based on antigen and virus structure research.
Vaccine sector: front-end R & D + back-end commercialization to create a potentially optimal platform
Medium and short term: HPV vaccine volume window period, optimistic about the continuous verification of commercialization ability.
① industry level: the vaccination rate continues to increase, laying a big space for HPV vaccine. In terms of market space, estimated by the terminal sales price, the sales volume of HPV vaccine will be about 13-15 billion yuan in 2020 and 20 billion yuan in 2021 +. In terms of the kinetic energy of improving the vaccination rate, the disease burden is expected to be greatly reduced after HPV vaccination, and there is still room for continuous improvement under the goal of “90% of girls will be vaccinated against cervical cancer before the age of 15” by 2030. ② Company level: continuously verify the commercialization ability of HPV vaccine and establish the space occupying ability of HPV vaccine. From the perspective of commercial team, academic promotion + channels sink, and the company is expected to quickly establish a vaccine sales team with the help of large varieties.
Medium and long term: leading technical capacity and laying the foundation for innovative vaccine exceeding expectations.
We believe that the company’s core technical advantages in vaccine research and development are the basis for the rapid promotion and successful listing of innovative vaccine pipeline. The core technical advantages are reflected in vaccine design based on structural biology and efficient gene engineering recombinant antigen expression system.
From the research and development of HEV and HPV vaccines in Xiamen University Laboratory, the company’s core capabilities: specific antigen epitope structure research and immunogenicity design have cross platform and cross variety scalability. We believe that these advantages are expected to be continuously verified in research / clinical products such as VZV, RV, RSV and enterovirus vaccines. Expression system based on Genetic Engineering: it solves the core problems of preparation, assembly and preparation. In addition to hepatitis E vaccine and HPV vaccine, the company applies the production of E. coli expression system to other vaccine varieties. The company’s advantages are the genetic transformation of exogenous expression regulation mechanism and the optimization of growth conditions and parameters, which also have certain scalability. We are optimistic about the company’s advantages and breakthroughs in the selection and transformation of expression system and vaccine production technology.
IVD field: traditional strengths based on antibody / antigen research
① diagnostic reagent: it has competitive advantages and is expected to contribute to stable cash flow.
The market share of hepatitis C virus, syphilis, hepatitis B virus, HIV and other diagnostic kits is consistently ahead of the year, reflecting the accumulation of antigen-specific neutralization epitopes in the research team. We believe that traditional detection methods such as enzyme-linked immunosorbent assay still have many applicable scenarios. Based on the leading advantages of the company, we expect this sector to bring stable cash flow.
② chemiluminescence: it has begun to take shape with strategic focus and great flexibility at the profit end.
In terms of revenue volume, the company’s revenue from chemiluminescence reagents and equipment is lower than that of the first echelon of the industry, and has begun to take shape and grow rapidly (it is estimated that the compound growth rate of chemiluminescence reagent revenue is 55% + and that of chemiluminescence diagnostic instruments is 40% + from 2017 to 2020). From the perspective of chemiluminescence reagents, according to nmpa data, as of 2021, Beijing Wantai Biological Pharmacy Enterprise Co.Ltd(603392) and its subsidiaries have been approved 83 chemiluminescence reagents, lower than Shenzhen New Industries Biomedical Engineering Co.Ltd(300832) (141), but higher than Beckman and other companies; In terms of testing, the company’s advantages focus on the eight items before operation. We believe that the expansion of reagent categories is the key to the continuous expansion of the company’s chemiluminescence business. From the perspective of chemiluminescence equipment, although the company’s core equipment has room to improve in terms of test speed, sample size, test items and other indicators, the gap with the leader has narrowed. We expect that with the improvement of the company’s equipment sales and popularity, the chemiluminescence business will have profit elasticity.
Profit forecast and investment suggestions
We expect that the company’s EPS from 2021 to 2023 will be 4.65 yuan, 6.96 yuan and 9.15 yuan / share respectively. The closing price on March 4, 2022 corresponds to 36 times that of 2022, which is higher than the average of comparable companies. We think this may reflect the expectation of the continuous growth of the company’s large single product sales and the premium on the company’s technical ability. We believe that considering that the company’s HPV vaccine has an advantage window compared with its competitors, the traditional varicella vaccine is expected to be on the market in 2023, and the new varicella vaccine and nine valent HPV vaccine may be on the market in succession from 2025, so as to hedge the possible competitive pressure of bivalent HPV. In terms of core competitiveness, the research center cooperated by the company in Xiamen University has competitive advantages in vaccine design based on structural biology and efficient gene engineering recombinant antigen expression system. We believe that we can give a valuation premium to the vaccine business. In the IVD sector, the company’s chemiluminescence business is booming and provides cash flow in traditional advantageous fields, which is expected to continue to benefit from the research advantages of the cooperative team in the antigen field. Comprehensively considering the company’s competitive advantage and industry status, the “overweight” rating is given for the first time.
Catalyst
The listing speed of core vaccine varieties exceeded expectations; Sign vaccine commercialization authorization or cooperation agreement; Sales of chemiluminescence reagents or instruments exceeded expectations.
Risk tips
The clinical promotion speed of vaccine was lower than expected; Risk of excessive price reduction of core varieties; Cooperation with Xiamen University in R & D transformation is less than expected risk; Risk of deterioration of IVD variety competition pattern.
