\u3000\u3 China Vanke Co.Ltd(000002) 019 Yifan Pharmaceutical Co.Ltd(002019) )
Event:
The company released the first quarterly report of 2022. During the reporting period, the company’s main revenue was 906 million yuan, a year-on-year decrease of 24.53%; The net profit attributable to the parent company was 121 million yuan, a year-on-year decrease of 8.3%; Deduct non net profit of 768214 million yuan, a year-on-year decrease of 31.9%.
Comments:
The pressure on the performance in the first quarter was that the trading volume of calcium pantothenate sector was lower than expected. According to the data of China Customs, the export volume of calcium pantothenate has decreased significantly since February 2022, with a month on month decrease of 43.29%. The export volume of calcium pantothenate decreased by 56.60% year-on-year in March. We judge that the main reason for this phenomenon is that last year, the overseas vitamin market continued to overbought, the market as a whole was also in the stage of inventory consumption, the downstream end users had relatively abundant short-term stock, and lacked the willingness to purchase further. This led to the current price of calcium pantothenate rebounding, but the market trading volume was not as expected, resulting in the performance of the company’s calcium pantothenate sector being less than expected. We believe that with the gradual consumption of calcium pantothenate inventory in the future, the trading volume will gradually recover. More than 70% of the company’s API vitamin B5 (d-Calcium pantothenate) and original B5 products are sold to Europe, America and other countries and regions, with a global market share of 40-45%, ranking the leading position. Since 2022, due to the risk of capacity decline and cost rise caused by energy problems faced by some foreign manufacturers, the price of calcium pantothenate has risen to 360 yuan / kg, a huge increase compared with the average price of 83.04 yuan / kg in 2021. With the gradual increase of trading volume and price of calcium pantothenate, we expect the company’s vitamin sector to increase significantly in 2022.
The application for listing permission of f-627 in the United States, the European Union and China has been fully accepted and is expected to be listed in the near future.
F-627 is an innovative biopharmaceutical variety developed based on the existing di kinetm bimolecular technology platform with independent intellectual property rights of Yiyi biology. F-627 has been officially accepted in the biological product license application (BLA) of FDA and EMA of EU, and entered the key stage of technical review respectively; Meanwhile, f-627 submitted the application for listing of new biological products to nmpa in January 2022 and was officially accepted in February of the same year. At present, due to the impact of force majeure such as the epidemic, FDA is unable to promote on-site inspection and other steps. The delay of f-627 listing is not due to the company itself. We believe that the company said that it has actively prepared for the on-site inspection of production, welcomed the on-site inspection of FDA at any time, and made every effort to promote the listing of f-627 as soon as possible. At the same time, the commercial cooperation of f-627 abroad is progressing smoothly. As of April 23, 2022, the company has signed agreements with Nanjing Shunxin, kalteq and apogepha to license the exclusive distribution right of f-627 in Greece, Cyprus, Germany and Switzerland to the above companies. In terms of foreign markets, we estimate that the f-627 can occupy about 5% ~ 10% of the U.S. market, that is, 210 ~ 419 million US dollars; In the Chinese market, the product revenue space is about 1.58 billion yuan.
F-652 and f-899 are progressing smoothly and have great market potential. In 2021, the company completed the ind application in China for f-652 treatment of chronic plus acute liver failure (ACLF) and obtained the notice of clinical trial approval. By the first quarter of 2022, the subjects had begun to be enrolled. F-652 is the world’s first IL-22 recombinant protein drug under development, and has applied for a structural patent in China and the United States. It is the world’s first drug with intellectual property rights. F-899 (recombinant human growth hormone) has completed the ind application in China. It has entered clinical phase I during the reporting period. So far, it has completed the research work of more than five dose groups. Compared with competitors, the molecular weight of f-899 increases and the half-life in vivo is significantly prolonged. Clinically, it can be administered once every two weeks, which is expected to reduce the cost for users. Combined with the market space, we expect that f-899 can bring 1.74 billion yuan of revenue to the company.
Profit forecast and investment rating: in the long run, the company’s innovative drugs are highly competitive in China and abroad. After listing one after another, it is expected to quickly open the market and bring high profits to the company; With the recent sharp rise in the price of calcium pantothenate, the income of vitamin sector is expected to rise to the ideal level. We expect that the company’s revenue from 2022 to 2024 is expected to reach 5.306 billion yuan, 5.954 billion yuan and 6.417 billion yuan, and its net profit is expected to reach 740 million yuan, 976 million yuan and 1.256 billion yuan, corresponding to EPS of 0.72 yuan, 0.92 yuan and 1.19 yuan respectively, maintaining the recommended rating. It is optimistic that the company’s operation will continue to improve, the progress of innovative drugs is ideal, the performance of API sector will rebound, and the recommended rating will be maintained.
Risk warning: the R & D of innovative drugs is not as expected, the sales of pharmaceutical products is not as expected, and the approval of new drugs is not as expected.
