Vaccines rise, gold falls. Zhong, who once again topped China's richest man in 2022, can be said to have firmly grasped the wealth code.
According to the 2022 Hurun Global Rich List, Zhong is the richest man in China with a wealth of 455 billion yuan. For more than 20 years, Hurun has constantly updated the rich list, from Liu Yonghao, Huang Guangyu, Zong Qinghou... Wang Chuanfu to Xu Jiayin, they are entrepreneurs who have been put on the pyramid by the trend of the times, and Zhong Isshao is no exception.
On March 28, Nongfu Spring released the 2021 annual results announcement. In 2021, the total income of Nongfu Spring reached 29.696 billion yuan, and the net profit was 7.162 billion yuan, an increase of 35.7% year-on-year. Among them, the revenue of packaged drinking water, which accounts for half of the country, reached 17 billion yuan.
However, everyone knows that Zhong Shui is the man behind Nongfu Mountain Spring, but little understanding is that he actually controls a huge health industry map, in addition to Nongfu Mountain Spring, Wantai Biological, which has the aura of "the first domestic HPV vaccine" on its head, has become an important "cash cow" for Zhong.
As the first bivalent HPV (cervical cancer) vaccine manufacturer in China, Wantai Biotech will rely on the sales of a bivalent HPV vaccine alone to exceed 3 billion yuan in 2021, and its gross profit margin is as high as 92%.
Before the advent of the new crown vaccine, the HPV vaccine can be said to be the top of the vaccine industry, not only the "banknote capacity" has nothing to say, but also the stock price driver. In just two years of listing, the stock price of Wantai Bio has directly soared from the issue price of 8.75 yuan / share to 271.8 yuan / share on March 28, 2022, doubling 31 times, and the market value reached 165 billion yuan.
The richest man who has been hiding behind the scenes, "mystery" is his coat. In Zhong's view, the logic of his wealth is based on the relationship between selling "tea eggs" and building "atomic bombs". Health sectors such as Nongfu Spring sell "tea eggs", and Wantai Bio is its goal of building "atomic bombs" with high technology and high profits.
In addition to everyone's amazement that he sold a bottle of bottled water for two yuan and earned more than 20 billion yuan a year, he did not know that the HPV vaccine that is difficult to find now is also its "gold absorbing stone".
01, a needle is difficult to grab behind the back
Innovative drugs have always been a good business, and the HPV vaccine is a super-sought-after "commodity vaccine".
In 2021, Merck China's total revenue reached 4.262 billion US dollars, an increase of 60% year-on-year; while the domestic Zhifei Biologics, relying only on the agent of Merck's HPV vaccine, is expected to have revenue of more than 30 billion yuan in 2021, and Wantai Biologics' domestic bivalent HPV vaccine is directly "out of stock" after listing.
Since the approval of Merck's first HPV vaccine in 2006, four HPV vaccines produced by Merck, Glenschs Zoker and Wantai Bio have been listed worldwide. On March 24, 2022, Watson Bio's bivalent HPV vaccine was officially approved for listing, which is also the second domestic HPV vaccine after Wantai Bio, and it broke the long-standing situation of HPV vaccine track.
Previously, the three vaccine manufacturers had the subtypes of cervical cancer vaccine coverage, which were bivalent, quadrivalent and nine-valent, the difference was the number of virus types prevented. These three products are also the only "sharp weapons" that can prevent malignant tumors through vaccines.
It should be known that cervical cancer, known as the "second killer" of gynecological cancer, is second only to breast cancer. According to Guolian Securities, in 2020, there were about 110,000 new cases of cervical cancer in mainland China, accounting for about 18.3% of the global proportion, and the incidence rate was the first for female reproductive system tumors.
Studies have shown that the vast majority of cervical cancers are caused by HPV (human papillomavirus), and in cervical cancer, the detection rate of HPV is as high as 99.7%. Among them, the main threats to women of the right age are the "high-risk HPV" that can cause cancer, and the "low-risk HPV" that can cause genital warts.
High-risk HPV infection is mainly caused by HPV types 16, 18, 31, 33, 45, 52, and 58, resulting in about 90% of cervical cancer cases worldwide, of which 16 and 18 are the most common high-risk subtypes, which can cause 70% of cervical cancer.
According to soochow Securities Research Report, 84.5% of cervical cancer in China is caused by type 16 and 18 viruses, while the protection rate of nine valence is 90%. If you are in the most suitable age range of 16-26 years old to hit the nine-price, it is natural that the higher the price, the higher the protection rate.
Before breaking the monopoly, each imported HPV vaccine required three injections, and its high price has always deterred many girls. Specifically: the price of the nine-valent HPV vaccine is about 1300 yuan / shot, the price of the quadrivalent HPV vaccine is about 800 yuan / shot, and the price of the bivalent HPV vaccine is about 600 yuan / shot.
The price per dose of the domestic Wantai Biological bivalent HPV vaccine (Xinkening) is as low as 364 yuan, from the economic cost point of view, the cost of the full vaccination of the Bivalent HPV vaccine of Wantai Biology is less than three injections, 658 yuan (9-14 years old, two injections), 987 yuan (15-45 years old, three injections).
Compared with the full vaccination cost of 1840 yuan for the bivalent vaccine of GlaxoSmithKline, the price of Wantai Bio's "two-shot method" and "three-needle method" is only 38% and 56% of GlaxoSmithKline, respectively.
The price is better, but it does not alleviate the phenomenon that a shot is difficult to find, because the current HPV vaccine is not worried about selling at all, and the worry has always been about production capacity. This is also why although the HPV vaccine is not a "new vaccine", to this day, most consumers still have to rely on major platforms or communities to make appointments to get the vaccine, and even in Shenzhen and other places to grab the vaccine through the lottery.
According to the Huaxi Securities Research Report, the number of women aged 9-45 in China is currently about 381 million, and the current penetration rate of HPV vaccination among women of appropriate age is only about 7%.
Li Qin, who waited for a year at the Xinyuan Community Health Service Center in Daxing Jiugong, Beijing, told the city: "A year ago, I only made an appointment by chance, and I didn't have any hope, but I didn't expect that in September 2020, the community actually called me to say that there was a seedling, and it was not easy to hit the nine-price. ”
At present, the world's nine-valent HPV vaccines are only produced by Merck Pharmaceutical Factory in the United States, and it is not an easy task to meet the vaccine needs of more than 70 countries and regions around the world at once.
Although Wantai Bio's bivalent HPV vaccine has been on the market for two years, in the face of hundreds of millions of people's demand, even if the annual output reaches 30 million doses, in the face of a "supermarket" of 381 million people, Wantai Bio is also "weak in heart".
Nowadays, in the bivalent HPV vaccine market, Wantai Bio's market share exceeds 85%, which can be said to be a well-deserved king. However, Wantai Bio is not an overnight hit, behind this hot HPV vaccine, Wantai Bio actually has an "unnamed" vaccine, hepatitis E vaccine.
02, a vaccine crowned the king
In 2020, if non-Nongfu Shanquan and Wantai Bio have landed on the capital market one after another, Zhong Is not well known.
The 68-year-old Zhong, a native of Zhuji, Zhejiang Province, worked as a bricklayer carpenter, ran a journalist and finally went to sea to do business before founding Nongfu Spring. And Zhong's first bucket of gold also came from health care products.
In the 1990s, Zhong Washuo was also a member of the "Gold Rush" in Hainan, because he was inspired to see Hainan people talking about business and used to order a pot of turtle and turtle boiled health soup, and finally found experts to develop a health soup turtle pills, a hit.
Subsequently, it entered the water sales business, starting from Nongfu Spring, extending the brand beverage industry including oriental leaves, tea π, farmer orchards, etc., and the food sector represented by Qingzui and Mother Beef Meat Stick, which are mainly held through Yangshengtang.
The only company directly owned by Zhong Himself who holds 18.17% and indirectly holds about 56.98% of the shares through Yangshengtang is Wantai Bio. Its main business is: research and development and production of in vitro diagnostic products and vaccines.
Speaking of the story of Zhong Andi and Wantai Creatures, it goes back 20 years. After experiencing the ups and downs of the health products industry in the 1990s, Zhong found an "insurance" track for himself, biopharmaceuticals.
At that time, someone recommended Xiamen University to Zhong. In 1998, Professor Xia Ningshao, then director of the National Infectious Disease Diagnostic Reagents and Vaccine Engineering And Technology Research Center of Xiamen University, was leading the team to start the research and development of a hepatitis E vaccine in mainland China.
This Professor Xia Ningshao and Zhong Sui's experience is quite similar, before being transferred to Xiamen University, Xia Ningshao was only a doctor in the Department of Infectious Diseases of Loudi People's Hospital in Hunan Province, with academic qualifications and secondary schools, and the field of study was not the traditional advantageous discipline of Xiamen University.
Xiamen University is only one of Zhong's many investment projects. In 2000, Zhong established the "Xiamen University Yangshengtang Biopharmaceutical Laboratory" through the cooperation of Yangshengtang and Xiamen University. In September of the following year, Zhong, who was 47 years old at the time, spent 17.1 million yuan to buy wantai Biologics, a biomedical company that was constantly being "sold" from Hong Kong investors, and held 95% of its equity, officially entering the biological vaccine industry.
Li Shicheng, chairman of Xiamen Wantai Canghai Biotechnology Co., Ltd., a subsidiary of Yangshengtang, once recalled: "Among the teams that signed a strategic cooperation agreement with Yangshengtang that year, only Xia Ningshao's team 'survived' and continued to produce results. ”
Now, it is Xia Ningshao's team that has developed a prokaryotic expression system based on E. coli, coupled with the independently discovered hepatitis E virus target, and successfully developed the world's first hepatitis E vaccine. Before the successful development of Wantai Bio's bivalent HPV vaccine, its vaccine sector has not improved, and only one product, hepatitis E vaccine, has contributed revenue.
Many people have heard of hepatitis A, B and even hepatitis C, but they are not familiar with hepatitis E. In fact, people infected with the hepatitis E virus are usually due to eating pork products that are not cooked, and symptoms similar to influenza will appear after infection, and people with low immunity are high-risk groups.
For the prevalence of hepatitis E vaccine is not high, in the view of domestic vaccine expert Tao Lina, there are three main reasons, he said: "First of all, hepatitis E is the last hepatitis to be discovered (1980); secondly, hepatitis E is mainly transmitted by the digestive tract, if it is a place with better sanitary conditions, it is not easy to have an epidemic; finally hepatitis E usually infects adults, and adult vaccination itself is more difficult to popularize." ”
This also causes that although Wantai Bio's hepatitis E vaccine has been successfully listed since 2012, as the world's first hepatitis E vaccine on the market, sales have not been satisfactory since its listing. In 2019, the sales revenue was only 14.96 million yuan, accounting for 1.3% of the year's revenue.
In 2019, Wantai Bio's revenue was 1.184 billion yuan and net profit was 209 million yuan, in fact, it can be said that 99% of the revenue is contributed by in vitro diagnostic products.
What really opened up the huge market imagination space was that on December 30, 2019, wantai Biotech's bivalent HPV vaccine "Xinkoning", which has been developed for 18 years, obtained the registration approval, becoming the first domestic HPV vaccine approved for marketing.
This huge market prospect is also vividly reflected after the successful landing of Wantai Bio on the Shanghai Stock Exchange in April 2020. From the issue price of 8.75 yuan to open the soaring mode, the highest touched 299.77 yuan / share, which can be called the absolute dark horse of A shares.
For the different fates of the two vaccines, Wantai Bio said: "In fact, hepatitis E is a very heavy product, but it has been ignored by everyone, and hpvide vaccine sales are good because there are many people calling for high awareness, and more people pay attention to it to improve the vaccination rate." ”
As investors expect, after the market penetration rate of Wantai Bio's bivalent HPV vaccine stock increases to steady state, where is the next blockbuster product?
03, who can win the domestic nine-valent HPV "first"?
The nine-valent HPV vaccine is a huge gold mine to be mined in front of Wantai Bio and other domestic vaccine manufacturers.
In addition to holding the trump card of domestic bivalent HPV vaccine, Wantai Bio has long laid out a nine-valent HPV vaccine, and obtained clinical approval in 2017, and the current research and development progress has entered the clinical phase III trial. According to the Huaxi Securities Research Report, Wantai Bio's nine-valent vaccine is expected to be approved for listing at the end of 2024 or early 2025.
In addition to Wantai Biologics, the domestic HPV vaccine head players also include Ruike Biologics, Kangle Guardian, bowei biology, and the nine-valent HPV vaccines of these three companies have entered the clinical phase III stage.
According to the relevant policies, foreign companies are not allowed to directly sell vaccine products in China, and at present, Zhifei Bio is only the exclusive agent of Merck's nine-valent HPV vaccine. That is to say, before the domestic vaccine manufacturers broke the monopoly of the nine-valent vaccine, the initiative of this part of the market was completely in the hands of Merck.
In the face of the huge demand gap in domestic production, it is also the "ceiling" of the current HPV vaccine, and the nine-valent price is naturally more popular. And in terms of batch issuance, four and nine prices are also the mainstream of the current market.
In 2017, the number of HPV vaccine batches issued in mainland China was 1.4552 million, and by 2020, this number will increase to 15.4317 million, with a compound annual growth rate of 120%. In terms of product structure, the market share of bivalent HPV vaccines decreased from 76.08% in 2017 to 20.39% in 2020; the market share of nine-valent vaccines increased from 17.06% in the first year of listing to 32.83% in 2020.
Fortune Business Insights expects the global HPV vaccine market to continue to grow at a compound growth rate of 16.3% from 2021 to 2026, or more than $13.5 billion in 2026.
Although the current domestic HPV vaccine market size is far from reaching its peak, the nine-valent HPV vaccine may become the next most fiercely contested field.
Compared with other vaccine manufacturers, Wantai Biotech's research and development for many years has been carried out jointly with Xiamen University, and it is not too much to say that it depends on Xiamen University. After the 10-year contract between Wantai Biotech and Xiamen University expired in 2021, the two sides renewed the contract for another 10 years.
According to the agreement, Xiamen University is mainly responsible for the research and development of diagnostic reagents and vaccines, and the construction of a key technology platform for innovative research and achievement transformation at the source, and the company industrializes the corresponding research results.
Wantai Biology's first marketed hepatitis E vaccine and domestic cervical cancer vaccine were developed in cooperation with Xiamen University. In addition, Wantai Biotech's prospectus also discloses that 58 of the 88 domestic invention patents it has are jointly held with Xiamen University, and 82 of the 101 patents in Hong Kong and overseas are jointly held with Xiamen University.
Although the two sides are currently in the sweet period of cooperation, this excessive dependence on school-enterprise cooperation has also made Wantai Bio's own independent research ability questioned by the outside world. The proportion of its R & D expenses is also declining, in 2021 Wantai Bio invested in R & D expenses of 682 million yuan, accounting for 11.86% of the total operating income, but has been more than 4 percentage points lower than 16% in 2015.
In addition, in addition to the nine-valent HPV vaccine, Wantai Bio has two other blockbuster products under development that are also in cooperation with Xiamen University, including a new lyophilized chickenpox live vaccine that is undergoing phase IIb clinical trials, and a phase III new coronavirus nasal spray vaccine that is planned to be launched overseas.
From the perspective of research and development pipelines, whether it is chickenpox vaccine or new crown nasal spray vaccine, there are many player layouts in China, and the "flashpoint" of Wantai Biological's performance after the two-valent may be more focused on HPV nine-valent vaccine.
Regardless of the future growth space of Wantai Biology, just from the perspective of the commercial logic of Nongfu Spring and Wantai Biology, Zhong Shui, who stood on the position of the richest man this time, also happened to be an entrepreneur who was entrusted to the tip of the pyramid under the trend of the times. The change of the richest man is actually a change of economic trajectory.
(Li Qin is a pseudonym in the text)
(Except for the separately marked source, the above picture is from Visual China)
(Author 丨 Zeng Jiayi, Editor 丨 Liao Ying)