Two studies have revealed that the new crown is severe, and the market for high-value consumables has hidden concerns

Jiuan Medical, Jianfan Biological, and Kangyuan Pharmaceutical are all money-making experts, but each has its own worries

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Earnings reports

Jiuan Medical (002432. SZ）

On April 12, 2022, Jiuan Medical disclosed the first quarter of 2022 performance forecast, and the net profit is expected to be 14 billion to 16 billion yuan, an increase of 36707.43% - 41965.63% year-on-year, while the net profit in the same period last year was only 38.04 million yuan.

Based on a total of 90 days in the first quarter, Jiuan Medical's daily revenue was about 160 million yuan.

For the soaring performance, Jiuan Medical said that the demand for new crown antigen detection kit products in the United States has increased significantly, and its US subsidiaries have sold antigen kit products through their own channels and Amazon platforms, and signed major contracts and orders with customers, and the sales revenue growth of the product has made an important contribution to the company's performance.

Jiuan Medical also disclosed the 2021 annual performance express, with revenue of 2.008 billion yuan, an increase of 25.11% year-on-year; net profit of 913 million yuan, an increase of 276.87% year-on-year.

From November 2021 to January 2022, Jiuan Medical's stock price rose more than 10 times in two months, and was once called a "demon stock" by the market.

The surge in performance made Jiuan Medical rise and fall for three consecutive days from April 12 to 14, 2022, and as of noon on the 15th, the market value reached 42.557 billion yuan.

However, Jiuan Medical has also been in turmoil due to the new crown antigen kit. In February, liu Yi, chairman of Jiuan Medical, and Wu Tong, secretary of the board of directors of Jiuan Medical, were taken by the Tianjin Regulatory Bureau of the China Securities Regulatory Commission to supervise the supervision and management measures of the Tianjin Regulatory Bureau of the China Securities Regulatory Commission because only some of the successful experimental results of the product were disclosed, and the disclosure information was incomplete.

In February, the Shenzhen Stock Exchange also issued regulatory letters due to the incomplete disclosure of the company's information on the experimental results, and the repeated inaccuracies and incompleteness in the responses on the public platform and the investor relations activity record sheet published.

Kangyuan Pharmaceutical (600557. SH）

On April 12, Kangyuan Pharmaceutical released the first quarter of 2022 results, the company's revenue of 1.079 billion yuan, net profit of 110 million yuan, an increase of more than 25% year-on-year.

Previously, Kangyuan Pharmaceutical's exclusive variety of hot poison ning injection was listed as a recommended drug in the clinical treatment period of severe and critically ill confirmed cases by the "Diagnosis and Treatment Plan for Novel Coronavirus Pneumonia (Trial Ninth Edition)", and the multi-dosage form variety of Huoxiang Zhengqi was listed as a recommended drug in the medical observation period.

Hot poisoning injection is one of the main products of Kangyuan Pharmaceutical, and the sales revenue of this product will account for more than 10% of revenue in 2021. Kangyuan Pharmaceutical expects that the above scheme will have an impact on the marketing and sales of hot poison ning injection and Huoxiang Zhengqi varieties.

However, Jicai is still a sword of Damocles hanging over the heads of Chinese medicine companies.

On the evening of April 8, 2022, the chinese patent medicine alliance in six provinces, including Guangdong, Shanxi and Henan, announced the results of the proposed bid. Among them, among the exclusive varieties, the large strain of Rhodiola rosea capsules of Kangyuan Pharmaceutical has the highest decline, and the proposed price is 0.7673 yuan / capsule, which is 1.16 yuan / capsule compared with the highest daily average cost / maximum effective declaration price, a decrease of 33.85%.

BGI Genomics (300676. SZ）

On April 12, BGI Gene, a leading genetic testing company, announced its first quarter 2022 performance forecast.

The company expects to achieve operating income of about 1.4 billion to 1.6 billion yuan, a change of -10.45% to 2.34% from the same period last year; and the net profit attributable to shareholders of listed companies is expected to be about 300 million to 350 million yuan, down 33.33% to 42.85% from the same period last year, mainly due to changes in the new crown business and the increase in operating investment.

BGI said that during the reporting period, the company's new crown-related business revenue decreased compared with the higher base in the same period of 2021, of which the company participated in the first quarter of 2022 to help Hong Kong fight the epidemic, and the settlement progress of some businesses was affected by the epidemic, and no revenue was recognized during the reporting period.

Jianfan Bio (300529. SZ）

Jianfan Bio released its 2021 annual report, the company achieved revenue of 2.675 billion yuan last year, an increase of 37.15% year-on-year; net profit attributable to the mother was 1.197 billion yuan, an increase of 36.74% year-on-year.

The company belongs to the medical device industry, mainly engaged in blood perfusion related products and equipment research and development, production and sales, products are used in uremia, poisoning, severe liver disease, autoimmune diseases, multi-organ failure and other fields of treatment.

However, under the growth of performance, the capital market has a certain divergence on the prospects of Jianfan Biotech, due to the market's concern that high-value medical consumables are gradually being included in the national collection. Although Jianfan Bio stressed in its annual report, the risk of being included in the national collection in the short term is small.

In May 2021, Hunan Hengyang collected blood perfusion devices, and Jianfan Bio abandoned the collection bid. In this regard, the company said on the investor interactive platform, "The company's sales volume of blood perfusion devices in 2020 has exceeded 3.6 million, and the number of perfusion perfusion devices collected in Hengyang City is only 8,000 perfusion devices per year, and it needs to be distributed among the 2 winning bidders, so the impact of Hengyang local collection on the company is very small." ”

Since May 2021, the stock price of Jianfan Bio has been cut.

event:

Chinese stocks are not very peaceful, and some pharmaceutical companies have been included in the "provisional list". This time it is legendary creature (LEGN.O) listed on the NASDAQ in the United States.

On April 13, Jinsry Biotechnology (01548. HK) announced that the U.S. Securities and Exchange Commission (SEC) has listed Legendary Bio as an issuer that uses auditors subject to review by the Public Company Accounting Oversight Board (PCAOB). The matter came under the Foreign Corporations Accountability Act (HFCAA). The list on which it is located is referred to simply as the "provisional list".

Legendary Bio, a spin-off company from Kingsley Biotechnology, has landed on the NASDAQ exchange in June 2020.

Kingsley Biotech said the incident was in line with Legendary Bio's expectations after Legendary Bio submitted its annual report to the SEC on March 31, 2022, on Form 20-F. This designation does not imply that legendary creatures will be removed from nasdaq.

Under the HFCAA Act, delisting can only occur if the PCAOB has been unable to review legendary bio's audit body for three consecutive years. In addition, there is legislation yet to be adopted that seeks to shorten the period from three to two years.

Legend Bio is currently monitoring market developments and evaluating measures that meet the requirements of the HFCA Act by the above deadline.

In the capital market, legendary creatures fell 4.11% on April 14.

Legendary creatures are not alone. As of April 15, there were seven Chinese pharmaceutical companies involved in the list: CASI Pharmaceuticals, Inc., Connect Biopharma Holdings Limited, Green Vision Biotechnology Corp., and Legendary Biologics, still on the "tentative list." middle.

BeiGene, Zaiding Pharmaceutical, and Huang Pharmaceutical, the three companies that entered the "provisional list" earlier, have been included in the "final list" over time.

But this "list" storm is not aimed at pharmaceutical companies. For example, Baidu, Sohu, iQiyi and other companies are also on the tentative list.

The China Securities Regulatory Commission responded to the matter in the early morning of March 11, saying that it always adheres to the spirit of openness and cooperation and is willing to solve the problem of inspection and investigation of relevant firms by US regulatory authorities through regulatory cooperation, which is also in line with international practice.

Research: Causes of severe COVID-19

Two studies have found that immune cells infected with the new coronavirus (SARS-CoV-2) can trigger a massive inflammatory response that can lead to severe COVID-19.

Since the beginning of the outbreak, studies have shown that inflammation can lead to severe respiratory distress and other organ damage, which are all signs of severe COVID-19. But scientists have struggled to determine what causes these inflammations.

One of the studies

In a paper published in Nature, Judy Lieberman, an immunologist at Boston Children's Hospital, and her colleagues analyzed blood samples from people infected with COVID-19. They found that about 6 percent of monocytes — immune cells known as "early responders" who search the whole body for foreign invaders — developed a type of cell death associated with inflammation, known as pyroptosis. It's not normal to see so many dead cells, she said, because the body is generally able to quickly clear dead cells.

While studying these dying cells, the researchers found that they were all infected with the new coronavirus. They believe that the new crown virus is likely to activate the small body of inflammation , a class of large molecules that can induce an inflammatory response that ultimately leads to cell death.

Study two

A preprint paper from a non-peer-reviewed paper shows that the researchers found in human lung cells and mouse models of the human immune system that the new coronavirus can infect macrophages and replicate in them. These macrophages developed the same inflammatory response as Lieberman described and eventually died.

The team also found that giving mice drugs that block inflammasomes prevented severe respiratory distress.

Esen Sefik, an immunologist and co-author of the paper, said the drugs "saved the lives of mice so they didn't get too sick." This suggests that infected macrophages play a role in pneumonia in severely ill COVID-19 patients.

The two newest studies point to two types of white blood cells — macrophages in the lungs and monocytes in the blood — that induce inflammation when infected with the new coronavirus. The two studies also used conclusive evidence that the new crown virus can infect and replicate immune cells, while revealing how the new crown virus enters these cells. Until then, the evidence for this type of infection has been inconsistent.

Two studies have given a plausible explanation for the course of severe COVID-19, with Malik Peiris, a virologist at the University of Hong Kong, saying, "I don't think it's the only or most important pathway, but it's certainly an interesting one." ”

Either way, infected immune cells could be a potential target for drug discovery, says Jian Zheng, an immunologist at the University of Iowa.