Key investment points
Event: on March 17, the Geneva pharmaceutical patent pool (MPP) announced that it had signed agreements with 35 enterprises around the world to authorize the production of API or / and preparation of Pfizer's oral covid-19 therapeutic drug nirmatrelvir (pf-07321332). Authorized generic drug companies will be able to provide paxlovid combination therapy to 95 low - and middle-income countries / regions around the world, covering about 53% of the world's population.
Comments: five Chinese enterprises have been authorized to pay attention to investment opportunities in relevant industrial chains. MPP official website shows that the authorized enterprises are distributed in 12 countries around the world, of which 6 companies produce APIs, 9 companies produce drugs, and the remaining 20 can produce APIs and drugs at the same time. There are five pharmaceutical enterprises in China, such as API preparation integration leader, Shanghai Fosun Pharmaceutical (Group) Co.Ltd(600196) , Apeloa Pharmaceutical Co.Ltd(000739) , Zhejiang Jiuzhou Pharmaceutical Co.Ltd(603456) , and desaino, which have been authorized, of which Zhejiang Jiuzhou Pharmaceutical Co.Ltd(603456) only produces API, and the other four can produce API and preparation at the same time. The evaluation criteria of MPP include enterprise production qualification, production capacity and supply chain management capacity, R & D and international registration capacity, distribution capacity of authorized areas, etc. prior to this authorization, since 2014, many Chinese pharmaceutical enterprises such as deseno, Baker, Langhua, Longze, Shanghai Fosun Pharmaceutical (Group) Co.Ltd(600196) , Brightgene Bio-Medical Technology Co.Ltd(688166) and so on have been authorized, reflecting the importance of Chinese pharmaceutical enterprises in qualification, R & D, production International registration and other capabilities continue to be internationally recognized.
On the one hand, the market increment of API + preparations may reach 70 billion yuan. It is suggested to pay attention to the performance increment of authorized enterprises and enterprises with the ability and qualification to produce relevant intermediates and advanced processes. Pfizer expects paxlovid's production capacity to reach 120 million treatment courses in 2022, and its sales in 2022 are expected to be $22 billion. Paxlovid is a compound preparation composed of 300mg (two 150mg tablets) of nirmatrelvir and one 100mg of ritonavir tablets. It is administered twice a day for 5 days. Assuming that the loss of API preparation is not considered, 120 million courses of treatment correspond to the API demand of 360 tons of nirmatrelvir at least. Taking into account the difference in incidence rate between 95 low and middle-income countries covering 53% of the world, and the difference in incidence rates due to differences in disease control and medical conditions, we expect that the nirmatrelvirAPI increment in 95 low and middle-income countries will be expected to reach about 400 tons, assuming that the price is 40 million yuan / ton, corresponding to the market increment of 16 billion yuan API. Assuming that the value of API accounts for 30% in the preparation, the corresponding preparation market may reach 53 billion yuan, and the total market scale of API + preparation is about 70 billion yuan.
On the other hand, it is suggested to pay attention to enterprises with strong technical strength, strong compliance production capacity and ability to undertake spillover orders caused by capacity gap. Pfizer estimates that about 250 million people worldwide need antiviral drugs in 2022, and there is at least a treatment gap of about 130 million. Enterprises with compliant production capacity are likely to benefit from the overflow orders brought by the capacity gap.
Covid-19 is expected to run through the whole year and is optimistic about the direction of the three industrial chains. Considering the continuous recurrence of the epidemic, the progress of drug research and development and the demand for subsequent opening up of the country, we believe that covid-19 specific drug is expected to become the main investment line throughout the year. We are optimistic about: 1) overseas original drug cdmo: Pfizer paxlovid has been approved by EUA in the United States, Europe, Japan, Canada, China and other countries or regions, and Japan yanye s-217622 has submitted its listing application in its own country, Optimistic about relevant cdmo and advantageous enterprises in all links of the industrial chain. 2) Generic API authorization: MSD molnupiravir and Pfizer paxlovid have authorized MPP. We believe that leading enterprises with strong R & D and cost control ability and fast speed are expected to enjoy dividends. 3) Independent research and development of domestic specific drugs and cdmo: at present, a variety of domestic specific drugs are in the clinical stage, among which real organisms and Shanghai Junshi Biosciences Co.Ltd(688180) lead. The preliminary analysis data of the real organism azvudine are good, and phase III clinical research is being carried out in Brazil and other countries Shanghai Junshi Biosciences Co.Ltd(688180) of vv116 has obtained the EUA of Uzbekistan, and the phase I data are good. The international multicenter phase III clinical trial has completed the enrollment and administration of the first patient. We are optimistic about drug R & D related enterprises and cdmo industrial chain enterprises with advantages of cost, production capacity and stable supply.
Investment suggestions: investment suggestions: focus on the investment recommendations: focus on the Chinese R & D and innovation companies that are on the way, the Chinese R & D and innovation companies, the big overseas drug companies, the cdmo industry chain for new drugs created by big overseas drug companies, and the generic industry chain, as well as the generic industry chain, such as the Shanghai Junshi Biosciences Co.Ltd(688180) , Zhejiang Starry Pharmaceutical Co.Ltd(603520) , Aurisco Pharmaceutical Co.Ltd(605116) , Jiangxi Synergy Pharmaceutical Co.Ltd(300636) , Ningbo Menovo Pharmaceutical Co.Ltd(603538) , etc.
Risk prompt event: policy change risk; Order fluctuation risk; Quality and environmental protection risks; Price reduction risk; Exchange rate fluctuation risk; The measurement of market scale is based on certain assumptions, and there is a risk that the assumptions are less than expected, resulting in inaccurate measurement results; Risk of untimely update of research report information.
