At present, the pharmaceutical and biological industry is in the tuyere of reform, superimposing the impact of the epidemic, and the enterprises in it are facing challenges from all dimensions. In the past year, there were those who found new profit growth points to ride the wind and waves, and those who were unable to move forward and lagged behind also existed.
As of April 27, among the listed companies in the pharmaceutical and biological industry whose annual reports have been disclosed in A-Shares and H shares, a total of 44 companies had a revenue of more than 10 billion yuan in 2021. But at the same time, over the past year, the total market value of these 44 pharmaceutical enterprises has shrunk by more than 1.7 trillion yuan.
As we all know, the operating revenue of more than 10 billion yuan is an important milestone for the development of pharmaceutical and biological enterprises. This indicator not only means that the company is attacking the head, but also means that the company builds a moat in the fields of strategic choice, development strength and anti risk ability. It is a sign that the enterprise is mature and has sufficient strength.
In view of this, the reporter of Securities Daily selected the 44 “10 billion yuan revenue pharmaceutical enterprises” as a sample, took the sales gross profit margin, the core index to measure the profitability of enterprises, as the criterion, and disassembled their financial report performance to explore the new trend of the development of head pharmaceutical enterprises and the industry.
three companies’ gross profit margin exceeds 80%
Data show that among the 44 listed pharmaceutical and biological companies with a revenue of more than 10 billion yuan, 13 have a sales gross profit margin of more than 50%, and only 3 have a sales gross profit margin of more than 80%.
In terms of ranking, among the 44 companies, Changchun High And New Technology Industries (Group) Inc(000661) ranks first with 87.61% gross profit margin Changchun High And New Technology Industries (Group) Inc(000661) 2021 annual report shows that the company’s main business is the R & D, production and sales of biopharmaceuticals and Chinese patent medicines, supplemented by real estate development, property management and services, of which the gross profit margin of pharmaceutical business is as high as 91%.
Jiangsu Hengrui Medicine Co.Ltd(600276) , the gross profit margin of the two listed companies of China biopharmaceuticals is also above 80%. Among them, 6 Jinfa Labi Maternity & Baby Articles Co.Ltd(002762) 021 annual report shows that the gross profit margin of the company’s pharmaceutical manufacturing business is 85.61%, of which the gross profit margin of anti-tumor products is 90.68%; The gross profit margin of anesthesia business is 89.08%, and that of contrast agent business is 72.24%.
In addition, the gross profit margin of 8 companies is less than 10%, including Sinopharm holdings, Zhejiang Int’L Group Co.Ltd(000411) , Nanjing Pharmaceutical Company Limited(600713) etc. among them, Nanjing Pharmaceutical Company Limited(600713) ranks last among 44 companies with a gross profit margin of 6.5%.
“The gross profit margin directly reflects the competitiveness of products. In short, the gross profit margin of products with high price and low cost is higher.” Yang xiuren, financial director of Dongfang Gaosheng, told the Securities Daily that in terms of the pharmaceutical industry, the gross profit margin of exclusive varieties is relatively high.
“There are many factors that affect the gross profit margin of listed companies.” Li Yifeng, chief researcher of Guangzhou roundstone investment pharmaceutical industry, told the Securities Daily: “including the market competition pattern, the enterprise’s marketing strategy, the enterprise’s R & D cost and the cost of fixed assets.”
“Generally speaking, the gross profit margin of pharmaceutical enterprises is high, while the gross profit margin of pharmaceutical circulation enterprises is low, which is a common phenomenon in the industry.” An analyst who declined to be named told reporters.
more than half of enterprises’ gross profit margin decreased
From the year-on-year data, the average sales gross profit margin of the above 44 companies in 2021 was 37.39%, down 0.98 percentage points from the average value in 2020.
Among them, the gross profit margin of 21 listed companies increased year-on-year. The highest increase was Guangzhou Baiyunshan Pharmaceutical Holdings Company Limited(600332) . The gross profit margin of sales in 2021 was 19.17%, an increase of 2.25 percentage points year-on-year. In addition, the gross profit margin of Chongqing Taiji Industry (Group) Co.Ltd(600129) sales increased by 2.08 percentage points year-on-year, and that of China biopharmaceutical increased by 2.06 percentage points year-on-year.
At the same time, the gross profit margin of 23 listed pharmaceutical enterprises decreased. Among them, the gross profit margin of Zhejiang Nhu Company Ltd(002001) , Shanghai Fosun Pharmaceutical (Group) Co.Ltd(600196) and other enterprises decreased significantly, accounting for 9.66% and 7.54% respectively.
The reporter combed the financial reports of several listed companies and found that factors such as volume procurement, falling medical insurance negotiation prices, intensified competition and rising costs have reduced the gross profit margin of enterprises.
For example, Shanghai Fosun Pharmaceutical (Group) Co.Ltd(600196) mentioned in the 2021 annual report that the gross profit margin of the company’s pharmaceutical business decreased by 8.27 percentage points year-on-year. Specifically, for the sub business segments, the gross profit margin of anti-tumor and immunomodulatory core products decreased by 0.6 percentage points compared with the same period, mainly due to the decline in the sales unit price of avatripopal maleate tablets after the implementation of the medical insurance negotiation price; The gross profit margin of core products of metabolism and digestive system decreased by 5.9 percentage points compared with the same period, mainly due to the decrease of the sales unit price of febusitar tablets after centralized collection.
In the past four years, the internal adjustment of the pharmaceutical and biological industry has accelerated, the centralized purchase of drugs has further reduced the price moisture of generic drugs, the drug review and approval has accelerated, so that innovative drugs can enter the market faster, and the promotion of reform is reshaping the competition pattern of the industry. According to the data, from 2018 to 2021, the average gross profit margin of the above 44 listed pharmaceutical enterprises was 38.71%, 39.25%, 38.37% and 37.39% respectively.
“With the promotion of centralized purchase, the intermediate link cost of drugs has been greatly reduced. This part of products do not need to ‘open high and return high’. Therefore, it is normal for some enterprises to have a decline in sales gross profit margin.” The above-mentioned analysts, who declined to be named, told reporters.
In addition, Li Yifeng told reporters that centralized mining will be normalized, forcing enterprises to accelerate “innovation + integration”. The operating risks of the highly competitive track and single product company will be further increased.
enterprises accelerate innovation and transformation
At present, the reform of the pharmaceutical and biological industry is still continuing, testing the speed and strength of enterprise transformation.
Recently, the Party group of the national medical security bureau published a signed article in Qiushi, saying that the medical insurance reform has reached a critical moment of getting involved in dangerous beaches and gnawing hard bones. In the future, it will further break the complex interest barriers and unswervingly promote the high-quality development of medical security. In the next step, the national medical insurance administration will continue to carry out centralized procurement in a normalized and institutionalized manner, and strive to achieve a total of more than 350 national and provincial centralized procurement drugs in each province within the year.
At the same time, the National Drug Administration will continue to implement the “double channel” mechanism to optimize the price of new drugs and save people’s lives. At the same time, the National Drug Administration will continue to implement the “double channel” mechanism to optimize the price of new drugs and save people’s lives. Comprehensively deepen the reform of medical insurance payment methods, establish a mechanism for scientific determination and dynamic adjustment of medical service prices, and promote the formation of a new pattern of benign interaction and common development between medical insurance and medical institutions.
Liu Youhua, deputy director of wealth Research Department of paipai.com, told the reporter of Securities Daily that pharmaceutical enterprises can develop from two aspects: on the one hand, strengthen the research and development of innovative drugs. The scarcity of innovative drugs is a favorable guarantee for pharmaceutical enterprises to improve their competitiveness; On the other hand, expand overseas business and enhance its international competitiveness.
It is worth mentioning that public data show that in the past year, the State Food and Drug Administration approved 76 new drugs (excluding vaccines), including 37 imported new drugs, 12 innovative traditional Chinese medicine drugs and 27 domestic innovative drugs. The number of new drugs approved during the year has been close to the level of developed countries.
Leading enterprises are accelerating the pace of innovation and transformation. For example, in the face of severe and complex competitive environment and industrial changes, 6 Jinfa Labi Maternity & Baby Articles Co.Ltd(002762) 021 accumulated R & D investment reached 6.203 billion yuan, a year-on-year increase of 24.34%, and the proportion of R & D investment in sales revenue reached 23.95%, a record high for the company. In its 2021 performance report, China biopharmaceutical pointed out that the pressure of centralized procurement was within expectations, the impact of the first four batches of centralized procurement was basically digested, and the subsequent centralized procurement faced a new situation of normalization; The impact of the fifth batch of centralized mining will continue to be digested in 2022. The company’s total R & D expenditure in 2021 was about 3.82 billion yuan, accounting for about 14.2% of the group’s revenue, most of which has been included in the income statement. Among them, the R & D investment of innovative drugs and biological drugs accounted for more than 70%, and the investment amount increased by about 64.7% year-on-year.
“Differentiated innovation will be the key to the second reshuffle of leading enterprises.” The above-mentioned analysts, who declined to be named, told reporters.
Li Yifeng told reporters that on the one hand, enterprises need to form platform advantages through self-research or acquisition to resist the risk of relying on a single product; On the other hand, we need to accelerate input and output in innovation and R & D to deal with the situation of centralized purchase and price reduction of mature products. “There are probably three paths for the transformation and upgrading of pharmaceutical enterprises: one is to innovate or go to sea strategically; the other is to develop difficult imitation drugs and find their own position; the third is to improve efficiency and reduce costs after optimizing production process or scale.”
