On March 8, Kangle guard announced that the listed companies of the national small and medium-sized enterprise share transfer system agreed to Citic Securities Company Limited(600030) be its market merchant from March 9. At the same time, on March 3, it also announced that under the guidance of the guidance organization, it had passed the guidance and acceptance of Beijing Securities Regulatory Bureau this means that the impact of Kangle guard on “the first share of domestic nine valent HPV vaccine” is further strengthened previously, Ruike biology, which also arranged the domestic nine valent HPV vaccine, also submitted a prospectus to the Hong Kong stock exchange, which is its second application after the expiration of its application on July 16, 2021.
Up to now, the HPV vaccines approved in China include the bivalent HPV preventive vaccine (16 / 18) produced by GlaxoSmithKline (GSK), the tetravalent HPV preventive vaccine (6 / 11 / 16 / 18) and nine valent HPV vaccine (6 / 11 / 16 / 18 / 31 / 33 / 45 / 52 / 58) produced by MSD, and the first bivalent HPV vaccine (16 / 18) developed by Beijing Wantai Biological Pharmacy Enterprise Co.Ltd(603392) R & D in China.
at present, there is no second nine valent HPV vaccine enterprise approved to be listed in China since the nine valent HPV vaccine of MSD was conditionally approved by the State Food and Drug Administration in 2018 now, affected by favorable policies, improved vaccine accessibility and vaccination willingness, China’s nine valent HPV vaccine is still in “short supply”. Under this opportunity, can the monopoly pattern of imported nine price HPV vaccine in the Chinese market be broken? Who will win the title of “the first share of domestic nine price HPV vaccine” between Kangle guard and Ruike biology, which are impacting the capital market?
recreation guard vs Reck biology
Kangle guard, founded in 2008, is a high-tech enterprise focusing on the research and development of recombinant protein biomedicine based on structural design. According to the company’s official website, Kangle guard was listed on the new third board on September 18, 2015. As an innovative enterprise on the new third board, it is committed to the research and development of innovative drugs to protect and prevent women from HPV virus infection and cervical cancer caused by infection. At present, Kangle guard is in the first echelon of domestic HPV vaccine development. Its pipeline core products include recombinant trivalent, nine valent and fifteen valent HPV vaccines, recombinant bivalent covid-19 vaccine, recombinant polyvalent norovirus vaccine, recombinant respiratory syncytial virus vaccine and recombinant herpes zoster vaccine. Among them, recombinant trivalent and nine valent HPV vaccines have entered phase III clinical practice.
Nine valent HPV vaccine is one of the key projects promoted by Kangle guard. In December 2020, the first subject was successfully enrolled in the center for Disease Control and prevention of Sheyang County, Jiangsu Province. In the same period, Kangle guard also completed round C financing, and the market value of the company exceeded 4 billion. The 650 million yuan raised in this round is mainly used for the phase III clinical expenses of HPV nine valent vaccine, the construction of industrialization base and the preclinical research of subsequent projects under research.
In May 2021, Kangle Weishi signed a cooperation contract with the Russian Pharmaceutical Group on the nine valent HPV vaccine project. The two sides will use Kangle Weishi’s HPV vaccine production technology to jointly develop and commercialize HPV nine valent vaccine in the Russian Federation. Russian Pharmaceutical Group will carry out phase III clinical immune bridging test of HPV nine valent vaccine in Russia after Kangle guard obtains phase III clinical data of HPV nine valent vaccine, and carry out localized production of finished vaccine after registration, so as to help Kangle guard innovate vaccine technology and internationalization of products.
In August 2021, Kangle guard announced that it had completed a round of pre IPO Financing of more than 1 billion yuan. The main investors include more than 10 professional medical and health investment institutions such as CCB international, Yunfeng fund, jiminxin and PCCW capital. The company plans to use the funds raised in this round for the clinical research expenses of nine valent HPV vaccine and three valent HPV vaccine, as well as the preclinical research expenses of products under research and supplementary working capital.
Insiders said that if Kangle guards can be successfully listed this time, it will receive financial support to further promote the clinical research and industrialization of nine valent HPV vaccine.
21st Century Business Herald reporter combed the current operation of Kangle guard company. According to the semi annual report of 2021, during the reporting period, Kangle guard achieved an operating revenue of 144800 yuan, a year-on-year decrease of 98.28%, which is mainly due to the lack of identifiable technology development revenue in the reporting period. During the reporting period, the net profit loss was RMB 221 million, with an increase in year-on-year loss, mainly due to the increase of management expenses and R & D expenses. Meanwhile, the company’s R & D expenditure was 998567 million yuan, an increase of 398677% year-on-year, mainly because the company added R & D projects and increased R & D investment.
Compared with the wellness guard, which is mainly engaged in HPV vaccine research and development, Ruike biology, founded in 2012, mainly focuses on the research and development of HPV candidate vaccines, has established a vaccine combination composed of 12 candidate vaccines, including HPV vaccine, covid-19 vaccine, adult tuberculosis vaccine, hand, foot and mouth disease vaccine, influenza vaccine, etc among them, as for HPV vaccine, Ruike biology has two bivalent HPV vaccine pipelines, one tetravalent HPV vaccine pipeline and two nine valent HPV vaccine pipelines.
21st Century Business Herald reporter learned from the prospectus that rec603, the core product of Ruike biology, is a recombinant nine valent HPV vaccine for the prevention of cervical cancer, which aims to provide protection against HPV6, 11, 16, 18, 31, 33, 45, 52 and 58. At present, it is in the phase III clinical trial stage, has completed the recruitment of subjects, and is expected to complete three doses in the first half of 2022. It is planned to reach the main end point of phase III clinical trial in 2025, and submit the BLA application to the State Food and drug administration.
In addition to rec603, REC bio has also developed two recombinant HPV bivalent candidate vaccines. At present, phase I clinical trials are being carried out in China, in which rec601 is for HPV 16 / 18 and rec602 is for HPV 6 / 11. In addition, a recombinant HPV nine valent vaccine rec604b and a recombinant HPV four valent vaccine rec604a developed by Ruike biology adopt a self-developed new adjuvant and may adopt a two shot administration scheme.
With the enrichment of vaccine product pipelines, REC bio’s demand for R & D funds has gradually expanded, and has carried out multiple rounds of financing for this purpose. According to the prospectus, as of September 30, 2021, Ruike biological obtained round B + and round C financing of RMB 1.165 billion; In 2020, it obtained the round B financing of RMB 686 million; In 2019, it obtained a round of financing of 500 million yuan.
although the financing amount is expanding, Ruike biology has not yet realized the commercialization of its candidate vaccine products and has not obtained any income from vaccine sales
According to the prospectus, as of 2019, 2020 and the first nine months of 2021, Ruike biological has no main income; The R & D expenditure in the corresponding period was 63 million yuan, 131 million yuan and 371 million yuan; The net losses in the corresponding period were RMB 138 million, RMB 179 million and RMB 520 million respectively.
However, Ruike biology said that as the company’s candidate vaccines enter the late stage of clinical development, it is expected to commercialize one or more candidate vaccines in the future.
It is worth noting that on the day after Kangle guard released the announcement of its intention to apply for listing on the Beijing stock exchange, it fell into a storm of information disclosure violations. On February 16, the official website of the national stock transfer system announced that the second management department of the listed company of the national stock transfer company issued a warning letter to the company and its chairman Hao Chunli and the financial person in charge Dong Wei on the violation of the information disclosure of the recreation guard of the innovative layer company of the new third board.
According to the announcement, it was found that Kangle guard had the following violations: on December 10, 2021, Kangle guard disclosed the announcement of correction of accounting errors in the early stage, and retroactively adjusted the financial data from 2017 to 2020 and the half year of 2021 due to the adjustment of the capitalization amount of R & D expenses and the cut-off error of R & D expenses.
The disclosure of the listed shares of Kangle company violates the regulations of the national information system for the transfer of shares of small and medium-sized enterprises. For the above violations, then chairman Hao Chunli and financial director Dong Wei failed to ensure the authenticity, accuracy, integrity and timeliness of the company’s information disclosure, violated relevant regulations and were mainly responsible for the above acts. In this regard, the national stock transfer company took self regulatory measures of issuing warning letters to Kangle guard, chairman Hao Chunli and financial director Dong Wei.
can break the monopoly of imported products
Cervical cancer is one of the common gynecological malignancies. Zheng Hong, chief physician of gynecological oncology department of Peking University Cancer Hospital, said in an interview with the reporter of the 21st Century Business Herald that cervical cancer has a definite cause. Therefore, through preventive means, lesions and cancer can be found and treated as soon as possible, so as to greatly improve the survival rate of patients. HPV vaccination can resist HPV infection and plays an important role in the prevention of cervical cancer.
Previously, Du Xueping, member of the expert advisory committee of the leading group for deepening the reform of the medical and health system of the State Council, introduced that there are many types of HPV, of which about 16 are high-risk types. Bivalent HPV vaccine has a protective effect on two high-risk types of cervical cancer (HPV16 and 18). Tetravalent HPV vaccine can resist the infection of HPV6 and 11 on the basis of bivalent vaccine, and reduce the risk of genital warts. The nine valent HPV vaccine covers more subtypes and can prevent more than 90% of condyloma acuminatum and cervical cancer.
In recent years, more and more people have realized the importance of HPV vaccine, and the residents’ willingness to vaccinate is also improving. According to the national public vaccine awareness survey report released in April 2021, 85% of the 12674 people participating in the survey recognized that vaccination can prevent diseases, which is significantly higher than 47% in the survey report in April 2020. The willingness to vaccinate HPV vaccine reached 65%, significantly higher than the current vaccination rate.
At the same time, some regions are successively introducing the policy of free HPV vaccination 2 on February 7, Hainan Province made it clear that school-age girls in the province would be vaccinated with domestic 2-valent HPV vaccine free of charge. On February 15, Fujian Province announced the pilot project of free HPV vaccination for women aged 13-14 and a half. Up to now, Shijiazhuang, Jiangsu Lianyungang Port Co.Ltd(601008) , Wuxi, Chengdu, Jinan, Xiamen and other cities have announced that they will provide free HPV vaccination policies for school-age women.
Driven by the policy, the HPV vaccine market has broad prospects. In 2020, as the second largest vaccine market in the world, China accounted for more than one fifth of the global market. According to the frost Sullivan report, from 2016 to 2020, the output value of China’s vaccine market increased from 27.1 billion yuan to 75.3 billion yuan, with a compound growth rate of 29.1%, and is expected to reach 333.3 billion yuan by 2030, with a compound growth rate of 16.0% from 2020 to 2030.
According to the data of the sixth census released by the National Bureau of statistics, the theoretical stock market capacity of HPV vaccine (women aged 9-45) totals 381 million people. Calculated by an average of 300 yuan / piece, the theoretical market space is nearly 350 billion yuan. According to the analysis and forecast of cervical cancer vaccine market status and key enterprises in 2022 released by China Commercial Industry Research Institute, the batch issuance of HPV vaccine in China shows a rapid growth trend year by year, from 1455200 bottles / bottle in 2017 to 12404100 bottles / bottle in 2020, with an average compound annual growth rate of 104%.
At present, HPV vaccines on the market all over the world have two, four and nine prices. In April 2018, the State Drug Administration conditionally approved the listing of the nine valent HPV vaccine used by Merck for the prevention of cervical cancer up to now, the second nine valent HPV vaccine in China has not been approved for listing, and MSD still enjoys the Chinese market of four valent and nine valent HPV vaccines alone
However, many consumers believe that the higher the price of the vaccine, the better the prevention effect, so they blindly pursue the nine price HPV vaccine. The nine valent HPV vaccine is “in short supply”, and there is a phenomenon that “one shot is difficult to obtain”.
Facing the huge market gap, MSD has felt the pressure. At the Fourth International Fair last year, Tian Anna, President of MSD China, who made her debut publicly, told the 21st Century Business Herald reporter that in the face of the growing health demand of the people, MSD’s HPV vaccine supply chain in China is also growing year by year, and will also significantly increase the supply of HPV vaccine to China. Many Chinese enterprises such as Kangle guard, Beijing Wantai Biological Pharmacy Enterprise Co.Ltd(603392) , Watson and others have targeted the nine price HPV vaccine market.
under the stimulation of demand, the research and development of HPV vaccine in China is also speeding up, trying to break the monopoly of imported products on the market in addition to Kangle guardian and Reck biology, the nine valent HPV vaccines of Beijing Wantai Biological Pharmacy Enterprise Co.Ltd(603392) , Bowei biology are also in phase III clinical stage. In March 2021, Beijing Wantai Biological Pharmacy Enterprise Co.Ltd(603392) said on the investor interaction platform that the company’s nine valent cervical cancer vaccine has entered phase III clinical practice, and the specific time of listing depends on the clinical and approval progress The nine valent HPV vaccine of Walvax Biotechnology Co.Ltd(300142) subsidiary is carrying out phase III clinical preparation.
In addition, the trivalent HPV vaccine of Kangle guard, the tetravalent HPV vaccine of Chengdu Institute of biological products and Bowei biology have also entered the phase III clinical stage. This month, the review and approval status of bivalent HPV vaccine listing application of Walvax Biotechnology Co.Ltd(300142) subsidiary has been updated to “under approval”.
Tao Lina, a vaccine expert, once said that behind the shortage of nine price HPV vaccine, there is only one manufacturer in the world. With the listing of domestic nine valent HPV vaccine, consumers will have more choices.
However, Zheng Hong also pointed out that although there are many types of nine valent HPV vaccine coverage, but Zheng Hong does not recommend that the public who have been vaccinated with two or four valent make-up nine valent vaccine because the nine valent vaccine only increases the safety factor and does not guarantee that the vaccinated person will not have cervical cancer, the benefit of the vaccinated person is not obvious. In order to better prevent cervical cancer, Zheng Hong also stressed the importance of screening. In order to find HPV infection and cervical cancer lesions as soon as possible, regular cervical screening is very important.
