HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Thematic (Sector/Industry)

Industry viewpoints:<ul>
<li>Last week, Biden’s administration surprised the whole pharmaceutical industry about the proposal to waive patent protections for coronavirus shots. However, our view is that the impact is likely to be limited.</li>
<li>The market size of COVID-19 vaccines in China is expected to reach RMB150 billion to RMB180 billion.</li>
<li>Recently, the National Health Care Security Administration, National Health Commission, NMPA and other related departments released documents about medium - and long-term development plan for the isotopes for medical purposes.</li>
</ul>Company news:News about the updated progress on new drugs of <a href="https://www.smartkarma.com/entities/beigene-ltd" target="_blank" data-smartkarma-citation="entities:27352:1" rel="noopener">BeiGene Ltd (6160 HK)</a>, <a href="https://www.smartkarma.com/entities/jacobio-pharmaceuticals" target="_blank" data-smartkarma-citation="entities:29696:1" rel="noopener">Jacobio Pharmaceuticals (1167 HK)</a>, <a href="https://www.smartkarma.com/entities/everest-medicines-ltd" target="_blank" data-smartkarma-citation="entities:29224:1" rel="noopener">Everest Medicines (1952 HK)</a> and <a href="https://www.smartkarma.com/entities/antengene-corp-ltd" target="_blank" data-smartkarma-citation="entities:29705:1" rel="noopener">Antengene (6996 HK).</a> Market review:Last week, stock price for healthcare sector in A share decreased 6.14%, while CSI 300 decreased 2.49% over the same period of time.Risk disclosure:Policy risk, R&amp;D risk, Company risk and COVID-19 risk.

Industry viewpoints:
Last week, Biden’s administration surprised the whole pharmaceutical industry about the proposal to waive patent protections for coronavirus shots. However, our view is that the impact is likely to be limited.
The market size of COVID-19 vaccines in China is expected to reach RMB150 billion to RMB180 billion.
Recently, the National Health Care Security Administration, National Health Commission, NMPA and other related departments released documents about medium - and long-term development plan for the isotopes for medical purposes.
Company news:News about the updated progress on new drugs of BeiGene Ltd (6160 HK), Jacobio Pharmaceuticals (1167 HK), Everest Medicines (1952 HK) and Antengene (6996 HK). Market review:Last week, stock price for healthcare sector in A share decreased 6.14%, while CSI 300 decreased 2.49% over the same period of time.Risk disclosure:Policy risk, R&amp;D risk, Company risk and COVID-19 risk.  

Equity Capital Markets

On February 24th, 2021, <a href="https://www.smartkarma.com/entities/yishengbio-co-ltd" target="_blank" data-smartkarma-citation="entities:32205:1" rel="noopener">YishengBio (1872307D HK)</a> announced the completion of a Series B financing of over $130 million, led by Oceanpine and OrbiMed. Soon after, on March 8th, Yisheng filed its IPO prospectus with the HKEX. Since the Changchun Changsheng vaccine scandal in 2018, rabies vaccines have been in short supply in China. Therefore, vaccine companies hope to seize this opportunity and develop vigorously with the help of the capital market. For example, last year, <a href="https://www.smartkarma.com/entities/chengdu-kanghua-biological-a" target="_blank" data-smartkarma-citation="entities:29895:1" rel="noopener">Chengdu Kanghua Biological-A (300841 CH)</a> was listed on the A-share market successfully. This year, Yisheng also plans to raise funds, expand the business and fund the future operation in the public capital market.

On February 24th, 2021, YishengBio (1872307D HK) announced the completion of a Series B financing of over $130 million, led by Oceanpine and OrbiMed. Soon after, on March 8th, Yisheng filed its IPO prospectus with the HKEX. Since the Changchun Changsheng vaccine scandal in 2018, rabies vaccines have been in short supply in China. Therefore, vaccine companies hope to seize this opportunity and develop vigorously with the help of the capital market. For example, last year, Chengdu Kanghua Biological-A (300841 CH) was listed on the A-share market successfully. This year, Yisheng also plans to raise funds, expand the business and fund the future operation in the public capital market. 

Pre-IPO YishengBio Co., Ltd  - Here Are the Concerns Despite Solid Market Potential

Equity Bottom-Up

Recently, <a href="https://www.smartkarma.com/entities/cansino-biologics-inc" target="_blank" data-smartkarma-citation="entities:27739:1" rel="noopener">CanSino Biologics Inc (6185 HK)</a> released the performance announcement in 2020. CanSino is expected to achieve the revenue in 2020 of RMB24.89 million, up 990.06% YoY. The Company's net loss attributed to shareholders could reach RMB407 million, up 159.63% YoY. Net loss after deducting non-recurring gains and losses is expected to reach RMB522 million, up 199.09% YoY. Meanwhile, CanSino had filed an application with the NMPA for conditional marketing authorization of the Recombinant Novel Coronavirus Vaccine (Adenovirus Type 5 Vector) (“Ad5-nCoV”, trade name: Convidecia™) and NMPA had accepted the application. On the other hand, according to the listing rules of the SSE STAR Market, CanSino needs to become profitable or successfully commercialize its products by at least 2024, or it will trigger delisting conditions. So, will the COVID-19 vaccine be CanSino's turning point?

Recently, CanSino Biologics Inc (6185 HK) released the performance announcement in 2020. CanSino is expected to achieve the revenue in 2020 of RMB24.89 million, up 990.06% YoY. The Company's net loss attributed to shareholders could reach RMB407 million, up 159.63% YoY. Net loss after deducting non-recurring gains and losses is expected to reach RMB522 million, up 199.09% YoY. Meanwhile, CanSino had filed an application with the NMPA for conditional marketing authorization of the Recombinant Novel Coronavirus Vaccine (Adenovirus Type 5 Vector) (“Ad5-nCoV”, trade name: Convidecia™) and NMPA had accepted the application. On the other hand, according to the listing rules of the SSE STAR Market, CanSino needs to become profitable or successfully commercialize its products by at least 2024, or it will trigger delisting conditions. So, will the COVID-19 vaccine be CanSino's turning point?

CanSino Biologics (6185.HK) - Will the COVID-19 Vaccine Be the Turning Point?

Compared with innovative drugs, the R&amp;D and production barriers of vaccine products are higher, and the pace of technology and product iteration is slower than that of innovative drugs. Except for the herpes zoster vaccine, the global sales of top ten varieties in the past decade are all the upgrades of existing product lines by enterprises. On the other hand, limited by indications, methods of use and competition of similar drugs, new drugs usually need to experience a gentle sales climbing curve. Both the impact of generic drugs after the patent cliff and the competition of other new products could lead to a rapid decline in sales. Vaccine products, especially those blockbuster vaccines, usually don't have such situations, and the product cycle is more stable.

Compared with innovative drugs, the R&amp;D and production barriers of vaccine products are higher, and the pace of technology and product iteration is slower than that of innovative drugs. Except for the herpes zoster vaccine, the global sales of top ten varieties in the past decade are all the upgrades of existing product lines by enterprises. On the other hand, limited by indications, methods of use and competition of similar drugs, new drugs usually need to experience a gentle sales climbing curve. Both the impact of generic drugs after the patent cliff and the competition of other new products could lead to a rapid decline in sales. Vaccine products, especially those blockbuster vaccines, usually don't have such situations, and the product cycle is more stable.

Industry Report - Insights on China Vaccine Industry

Chongqing Zhifei Biological Products / Equity Bottom-Up

On December 29th, 2020, <a href="https://www.smartkarma.com/entities/chongqing-zhifei-biological-products-co-ltd" target="_blank" data-smartkarma-citation="entities:6245:1" rel="noopener">Chongqing Zhifei Biological Products (300122 CH)</a> announced that its self-developed 15-valent pneumococcal conjugate vaccine (PCV15) had completed the preparation work and officially entered the phase III clinical trial. As a number of products in the pipeline continue to advance, PCV15 into clinical phase III is an important step in the pipeline valuation remodeling of the Company. In addition, Zhifei also announced that, on December 23rd, 2020, the Company and MSD reached an agreement: MSD will exclusively supply the products under the agreement to Zhifei, and Zhifei is authorized to import, distribute and promote the products in mainland China as agreed. After the successful renewal of the contract, the performance of the key products would be improved with certainty.

On December 29th, 2020, Chongqing Zhifei Biological Products (300122 CH) announced that its self-developed 15-valent pneumococcal conjugate vaccine (PCV15) had completed the preparation work and officially entered the phase III clinical trial. As a number of products in the pipeline continue to advance, PCV15 into clinical phase III is an important step in the pipeline valuation remodeling of the Company. In addition, Zhifei also announced that, on December 23rd, 2020, the Company and MSD reached an agreement: MSD will exclusively supply the products under the agreement to Zhifei, and Zhifei is authorized to import, distribute and promote the products in mainland China as agreed. After the successful renewal of the contract, the performance of the key products would be improved with certainty.

Chongqing Zhifei Biological Products- Promising Future After Successful Renewal of Contract with MSD

China

Shenzhen Kangtai Biological Products Co., Ltd. operates biological product manufacturing businesses. The Company produces biological vaccines and other vaccine products. Shenzhen Kangtai Biological Products conducts businesses in China.

Shenzhen Kangtai Biological Pr (300601 CH)

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Shenzhen Kangtai Biological Pr (300601 CH)

China Healthcare Weekly (May.7)

The article analyzed the potential impact on Biden’s proposal to waive IP protection on COVID-19 shots,market size of COVID-19 vaccine,new...

Xinyao (Criss) Wang

Pre-IPO YishengBio Co., Ltd - Here Are the Concerns Despite Solid Market Potential

This article mainly analyzed YishengBio in terms of market potential, competitive landscape, financial position, and concerns (insurance coverage,...

Xinyao (Criss) Wang

CanSino Biologics (6185.HK) - Will the COVID-19 Vaccine Be the Turning Point?

This article analyzed CanSino's core technology platforms, key products in the pipeline, insights on the products and core competitiveness and also...

Xinyao (Criss) Wang

Industry Report - Insights on China Vaccine Industry

The article analyzed China vaccine industry in terms of market potential, key vaccine varieties such as PCV13, influenza vaccine, HPV vaccine,...

Xinyao (Criss) Wang

Chongqing Zhifei Biological Products- Promising Future After Successful Renewal of Contract with MSD

This article analyzed Chongqing Zhifei Biological Products in terms of it agency business, self-developed products, forecast and rating, as well as...

Xinyao (Criss) Wang

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