In 2021, the nucleic acid detection of covid-19 virus tends to be normalized, and China's demand for reagents is still strong. However, as more and more enterprises enter the track and centralized purchase is carried out in various places, the price of covid-19 testing reagent is down, and the enterprise sales revenue and gross profit margin of some IVD enterprises are also down.
Over the past two years since the global covid-19 pandemic, the demand for covid-19 testing has become an important growth point driving the performance of IVD companies. What is the performance of IVD enterprises in 2021?
Through the recent 2021 annual reports disclosed by IVD enterprises, it can be found that although most enterprises have achieved revenue growth, with the weakening demand for covid-19 testing and the intensification of industry competition, the net profits of some enterprises have also decreased accordingly.
On April 13, Blue Sail Medical Co.Ltd(002382) ( Blue Sail Medical Co.Ltd(002382) ) released its 2021 annual report. During the reporting period, the company achieved an operating revenue of 8.109 billion yuan, a year-on-year increase of 3.04%, and a net profit attributable to shareholders of listed companies of 1.156 billion yuan, a year-on-year decrease of 34.28%. On April 16, Dian Diagnostics Group Co.Ltd(300244) ( Dian Diagnostics Group Co.Ltd(300244) ) released its annual performance report for 2021. During the reporting period, the company achieved an operating revenue of about 13.083 billion yuan, an increase of 22.85% year-on-year; The net profit attributable to shareholders of listed companies was 1.163 billion yuan, a year-on-year increase of 44.83%.
On April 19, Shenzhen Mindray Bio-Medical Electronics Co.Ltd(300760) ( Shenzhen Mindray Bio-Medical Electronics Co.Ltd(300760) ) disclosed the annual report of 2021. The company achieved an operating revenue of 25.27 billion yuan in 2021, an increase of 20.18% year-on-year. The net profit attributable to shareholders of listed companies was 8.002 billion yuan, a year-on-year increase of 20.19%. On April 22, Bgi Genomics Co.Ltd(300676) ( Bgi Genomics Co.Ltd(300676) ) released the annual report for 2021. The company achieved an operating revenue of 6.766 billion yuan, a year-on-year decrease of 19.42%; The net profit attributable to shareholders of listed companies was 1.461 billion yuan, a year-on-year decrease of 30.08%
On April 26, Guangzhou Kingmed Diagnostics Group Co.Ltd(603882) ( Guangzhou Kingmed Diagnostics Group Co.Ltd(603882) ) released its annual report for 2021. The company achieved an operating revenue of 11.943 billion yuan, an increase of 44.88% year-on-year; The net profit attributable to the parent company was 2.22 billion yuan, a year-on-year increase of 47.03%.
covid-19 business gross profit margin decreased
In 2021, the nucleic acid detection of covid-19 virus tends to be normalized, and China's demand for reagents is still strong. However, as more and more enterprises enter the track and centralized purchase is carried out in various places, the price of covid-19 testing reagent is down, and the enterprise sales revenue and gross profit margin of some IVD enterprises are also down.
From the perspective of several representative IVD enterprises, Blue Sail Medical Co.Ltd(002382) , Bgi Genomics Co.Ltd(300676) , Shanghai Zj Bio-Tech Co.Ltd(688317) ( Shanghai Zj Bio-Tech Co.Ltd(688317) ), Nanjing Vazyme Biotech Co.Ltd(688105) ( Nanjing Vazyme Biotech Co.Ltd(688105) ) and Sansure Biotech Inc(688289) ( Sansure Biotech Inc(688289) ) showed a decline in performance.
Blue Sail Medical Co.Ltd(002382) said in the 2021 annual report that the decline in performance was mainly due to the repeated impact of China's centralized procurement of cardiac stent products and foreign epidemics during the reporting period, as well as the downward trend in the price of health protection gloves, and the continued significant fluctuation in the price of raw materials.
Bgi Genomics Co.Ltd(300676) 2021 annual report shows that during the reporting period, due to the decline of global covid-19 nucleic acid reagent and detection unit price and the change of epidemic prevention strategy in some countries and regions, the company took the initiative to strategically adjust covid-19 related product structure and supply chain strategy, and the business income related to covid-19 decreased compared with the higher base in the same period of 2020.
Bgi Genomics Co.Ltd(300676) 's covid-19 testing related businesses are mainly carried out through "basic research on infection prevention and control" and "comprehensive solution for precision medical testing". Its annual report shows that in 2021, the operating revenue of precision medicine comprehensive solutions business decreased by 2.180 billion yuan year-on-year, and the gross profit margin decreased by 1.31%.
Shanghai Zj Bio-Tech Co.Ltd(688317) was listed on the science and Innovation Board of Shanghai Stock Exchange on January 18, 2021, and its 2021 annual report is its first show. According to its annual report, the company achieved an operating revenue of 2.019 billion yuan during the reporting period, a year-on-year decrease of 1.62%; The net profit attributable to shareholders of listed companies was 759 million yuan, a year-on-year decrease of 18.61% Shanghai Zj Bio-Tech Co.Ltd(688317) 's main products are molecular diagnostic reagents and instruments and equipment. Among them, the revenue of molecular diagnostic instruments decreased by 21.62% year-on-year in 2021 and that of nucleic acid detection kits decreased by 2.17% year-on-year.
Nanjing Vazyme Biotech Co.Ltd(688105) was listed on the growth enterprise market of Shanghai Stock Exchange on November 15, 2021. According to its 2021 annual report, the net profit attributable to the shareholders of the listed company decreased by 17.46% compared with the same period of last year, and the net profit attributable to the shareholders of the listed company after deducting non recurring profits and losses decreased by 20.90% compared with the same period of last year. It is mainly due to the implementation of the centralized procurement policy of medical devices and the intensification of industrial competition and other factors, the company moderately lowered the ex factory price of some products, Moreover, the company increased investment in R & D and operation, resulting in the continuous growth of R & D expenses and period expenses.
Specifically, Nanjing Vazyme Biotech Co.Ltd(688105) conventional business covers scientific research reagents, sequencing reagents, diagnostic raw materials, diagnostic reagents and instruments, cro services, etc. during the reporting period, the sales revenue was 719 million yuan, an increase of 91% compared with the same period in 2020; The sales revenue of covid-19 related businesses (including diagnostic raw materials and terminal detection reagents) reached RMB 1.149 billion, a decrease of about 3.25% compared with the same period in 2020.
It is worth noting that the accounts receivable of Nanjing Vazyme Biotech Co.Ltd(688105) 2021 was 322 million yuan, an increase of 42.47% year-on-year.
Sansure Biotech Inc(688289) founded in April 2008, it is a provider of in vitro diagnostic solutions integrating diagnostic reagents, instruments and third-party medical testing services. In 2020, Sansure Biotech Inc(688289) due to the performance explosion of covid-19 testing products, the revenue and attributable net profit soared by 120353% and 6527.9% respectively.
In 2021, Sansure Biotech Inc(688289) performance growth began to decline Sansure Biotech Inc(688289) annual report shows that the company achieved a revenue of 4.515 billion yuan in 2021, a year-on-year decrease of 5.22%; The attributable net profit was 2.243 billion yuan, a year-on-year decrease of 14.29%; The non net profit deducted was 2.151 billion yuan, a year-on-year decrease of 17.05%; The net cash flow from operating activities was 1.877 billion yuan, a year-on-year decrease of 28.96%; Accounts receivable and notes receivable increased by 808 million yuan year-on-year.
For the decline in performance, Sansure Biotech Inc(688289) said in the annual report that it was mainly affected by two factors. From the revenue side, the company's operating income and net profit during the reporting period decreased slightly compared with the same period due to factors such as the centralized purchase of China's novel coronavirus detection reagents and the general decline in the prices of covid-19 related products.
From the profit side, Sansure Biotech Inc(688289) said that the company continued to increase R & D investment. In 2021, the company's R & D expenditure reached 188 million yuan, a significant increase of 126.53% over the same period last year. It introduced a group of high-quality compound R & D talents and launched R & D layout for key strategic pipelines. At the same time, the company further strengthened its investment in international product development and registration and access, and 132 new products were registered and admitted outside China during the reporting period. The above investment increased the company's operating costs, resulting in a slight decline in profits compared with the same period last year.
Guangzhou Kingmed Diagnostics Group Co.Ltd(603882) ( Guangzhou Kingmed Diagnostics Group Co.Ltd(603882) ) notes and accounts receivable also rose. According to its annual report, notes and accounts receivable in 2021 were 4.665 billion yuan, an increase of 73.15% year-on-year.
Guangzhou Kingmed Diagnostics Group Co.Ltd(603882) also disclosed its capital risks in the annual report: first, due to the impact of covid-19 epidemic, the overall socio-economic development slows down, the medical insurance has invested heavily in covid-19 epidemic prevention and control, and the settlement of covid-19 nucleic acid testing fees in some areas may be delayed. Second, the epidemic continues, further aggravating the poor management of some private medical institutions and clinics, which may bring the risk of bad debts. With the increase of the number of days of joint construction of reagents and the proportion of funds in the industry, it will bring a certain risk.
ivd enterprises how to transform and develop
In 2021, with the marginal weakening of the positive impact of covid-19, many IVD enterprises are no longer limited to developing covid-19 testing business, but expand their product line and business scope. Many enterprises act frequently in the capital market.
In June 2021, Sansure Biotech Inc(688289) paid RMB 255 million to acquire 14.76% equity of Zhenmai biology, the R & D manufacturer of upstream equipment and reagents in the gene sequencing industry.
Beijing Hotgen Biotech Co.Ltd(688068) ( Beijing Hotgen Biotech Co.Ltd(688068) ) is engaged in the R & D, production and sales of in vitro diagnostic reagents and instruments. Its main products are in vitro diagnostic reagents and instruments, which are mainly used in clinical medicine fields such as liver cancer, hepatitis, cardiovascular and cerebrovascular diseases, inflammatory infection and other public safety fields such as biosafety, food safety, disease control and emergency response.
In September 2021, Beijing Hotgen Biotech Co.Ltd(688068) announced that the company, together with Chairman and general manager Lin Changqing and employee stock ownership platform Yaojing management center, planned to invest 100 million yuan to establish Yaojing gene to engage in exosome related gene detection and R & D projects. In December 2021, Beijing Hotgen Biotech Co.Ltd(688068) acquired 38.1% equity of Aorui biology, a cancer early screening enterprise, at a price of 153 million yuan.
In February 2022, Beijing Hotgen Biotech Co.Ltd(688068) announced that it planned to jointly invest 50 million yuan with the company's actual controller Lin Changqing and the employee stock ownership platform Beijing Yaojing enterprise management center (limited partnership) to establish a holding subsidiary Beijing Yujing Pharmaceutical Co., Ltd. (hereinafter referred to as Yujing pharmaceutical, and the final name shall be subject to industrial and commercial registration) to explore the research and development of live bacteria drugs.
Zhejiang Orient Gene Biotech Co.Ltd(688298) ( Zhejiang Orient Gene Biotech Co.Ltd(688298) ) is also specialized in the R & D, production and sales of in vitro diagnostic products. In December 2021, Zhejiang Orient Gene Biotech Co.Ltd(688298) invested and established a wholly-owned subsidiary of the company in Wenjiang District, Chengdu to carry out the biochip production and research base project, developing biochips, in vitro diagnostic reagents based on fluorescence quantification and time resolution and other product series, with a total investment of about 600 million yuan. In February 2022, Zhejiang Orient Gene Biotech Co.Ltd(688298) again announced that it planned to invest 500 million yuan to set up an international R & D and innovation center in Lingang New Area of Shanghai Free Trade Zone, expand the innovative R & D of products and equipment from molecular biological raw materials to molecular diagnosis and biochip technology diagnosis, and carry out the transformation and application of first to fourth generation gene sequencing technology.
According to the research reports of many securities companies, the influence of covid-19 is gradually reduced, and IVD platform has advantages. Covid-19 epidemic has stimulated the accelerated development of IVD industry and brought explosive performance growth. In the future, more tests will be put on the ability of enterprises to balance multi business products and transformation and development.
Previously, insiders also told the 21st Century Business Herald reporter that for in vitro diagnosis enterprises, the epidemic has brought more awareness of the public end of users and a strong correlation with the trust of the government in the sinking market. With the normalization of the epidemic and the weakening of demand, for enterprises, how to achieve real expansion in subdivided fields is the core of the competition in the second half.
