More than two years ago, Kanghua Biotech was listed on the Growth Enterprise Market (GEM) and raised 981 million yuan to expand the production capacity of freeze-dried human rabies vaccine (human diploid cells), namely the first phase of the Wenjiang vaccine production base and the construction of the R&D center. Now, more than two years have passed, and the project has not yet been completed and put into production. At the same time, the lyophilized human rabies vaccine (human diploid cells) produced by the subsidiary of Kangtai Biologics (300601), which is the main rival of Kanghua Biologics' contemporaneous vaccines, may be approved at the end of the year. At the same time, there are other domestic companies that develop and produce human rabies vaccines. From this point of view, the "third generation" of human rabies vaccines of Kanghua Biologics may be "squeezed out" in China, and its market share may be greatly impacted.
Raised CNY 981 million The vaccine expansion project has not been completed and put into operation for more than two yearsAccording to the "Announcement on Signing a Tripartite Supervision Agreement on Raising Funds" disclosed by Kanghua Biologics on June 30, 2020, according to the "Reply on Approving the Initial Public Offering of Chengdu Kanghua Biological Products Co., Ltd." (CSRC License [2020] No. 521) by the China Securities Regulatory Commission, Chengdu Kanghua Biological Products Co., Ltd. (hereinafter referred to as the "Company") issued 15.000 million RMB ordinary shares (A shares) with a nominal value of 1.00 yuan per share. The issue price was RMB70.37 per share, and the total proceeds from the offering were RMB105,555.00 million (RMB1.056 billion), and after deducting various issuance expenses of RMB74.577 million (RMB75 million), the actual net proceeds were RMB98,097.30 million (approximately RMB981 million). The proceeds were transferred to the Company's designated account on June 10, 2020. Lixin Accounting Firm (Special General Partnership) verified the availability of the raised funds, and issued the "Xinhuishi Zi [2020] No. ZD10135" "Chengdu Kanghua Biological Products Co., Ltd. Capital Verification Report".
For the purpose of the fundraising, Kanghua Biologics once pointed out in the prospectus that more than 70% of the raised funds will be used for the "Wenjiang Vaccine Production Base Phase I and R&D Center Construction Project", with a total investment of 727.4193 million yuan (727 million yuan), of which 7.24 million yuan is invested in environmental protection measures, and the source of funds is the raised funds, which can meet the needs of environmental protection after the construction of the fundraising and investment projects is completed.
Kanghua Biotech said in the prospectus that the company's existing Longquanyi District production base has a production capacity of about 3 million human rabies vaccines (human diploid cells) per year, and during the reporting period, the company's capacity utilization rate and production and sales rate have shown a continuous upward trend. After the implementation of the "Wenjiang Vaccine Production Base Phase I Construction Project", the company expects to increase the production capacity of freeze-dried human rabies vaccine (human diploid cells) by 6 million units per year. Moreover, with the implementation of this fundraising and investment project, the company's annual production capacity of freeze-dried human rabies vaccine (human diploid cells) will be increased from 3 million to 9 million, and the fourth to sixth years will gradually reach production, increasing the annual production capacity of 6 million units, it is expected that after the fundraising and investment project reaches production, sales will increase significantly, so that the company's competitiveness in the industry will be further enhanced.
Regarding the construction time of the project, Kanghua Biologics also pointed out in the prospectus that after the funds raised are in place, the fixed assets and intangible asset investment of the above-mentioned investment projects (the first phase of the Wenjiang vaccine production base and the R&D center construction project) will be gradually completed within 36 months.
If calculated according to the above-mentioned time of receipt of the fundraising funds, that is, June 10, 2020, the project has been more than two years and four months as of October 19, 2022, and there are less than 8 months left before the 36 months promised in the prospectus. However, the project has not yet seen the relevant announcement of completion and operation.
Some investors questioned on the interactive ease of "the lyophilized human rabies vaccine (human diploid cells) under research by Beijing Minhai Biotechnology, a subsidiary of Kangtai Biologics, is about to be launched, and I wonder when the company's fundraising and investment project will be put into production?" "The company raised and invested 6 million new production capacity projects construction is slow, far from completion and production, and Kangtai Biologics' 11 million production capacity of the same product has been approved for production, this year is expected to be listed, this capacity is twice the company's existing production capacity, while other companies' similar products are in phase III clinical trials, is expected to be on sale in a few years, I don't know how the company will face the competition of similar products of the above competitors next year? ”
Kanghua Biologics replied on September 29 that the company's fundraising and investment project "Kanghua Biologics Vaccine Production Expansion Project" is in the construction and installation stage, and can only be put into production after completion and relevant verification.
According to public information, the current mainland rabies vaccines are mainly gopher kidney cell rabies vaccine, Vero cell rabies vaccine and human diploid cell rabies vaccine. According to data from Huajing Industry Research Institute, the scale of the mainland rabies vaccine market will reach 6 billion yuan in 2021, a year-on-year increase of 9.09%, and it is expected to reach 11.1 billion yuan in 2030.
According to media reports, data from Essence Securities Research Report show that as of August 25 this year, a total of 19 rabies vaccines (including liquid and lyophilized dosage forms) have been approved for marketing in the mainland. Among them, 6 products are first-generation rabies vaccines, 12 products are second-generation rabies vaccines, and only Kanghua's freeze-dried human rabies vaccine (human diploid cells) has been approved for marketing, and this product is also the core product of Kanghua Biologics. According to the 2022 semi-annual report of Kanghua Biologics, in the first half of this year, 3,897,700 human diploid cell rabies vaccines were issued, a year-on-year increase of 151.11%; The sales of the product exceeded 645 million yuan during the reporting period, a year-on-year increase of 19.42%, and the gross profit margin reached 94.03%.
However, at present, it seems that Kanghua Biologics temporarily occupies the leading position of domestic three generations of rabies vaccines or has been squeezed out. According to the 2022 half-year report of Kangtai Biologics, the company's lyophilized human rabies vaccine (human diploid cells) has completed the registration site verification and GMP compliance inspection, and is about to be listed.
In addition to the same vaccine being chased by peers, production capacity will also be "hanged" by peers. According to what Kanghua Biotech mentioned in the prospectus, in 2019, the company carried out a technological transformation project to increase production capacity, and after the project is fully completed, the company's freeze-dried human rabies vaccine (human diploid cells) production capacity will increase by 2 million units/year; After the implementation of this fundraising and investment project, the company's annual production capacity of freeze-dried human rabies vaccine (human diploid cells) will increase by 6 million units/year, and after the completion of the above projects, the company's freeze-dried human rabies vaccine (human diploid cells) production capacity will reach 11 million units/year, which will effectively enhance the company's product production capacity and competitiveness.
On the other hand, competitors Kangtai Biologics. According to media reports, the lyophilized human rabies vaccine (human diploid cells) under research by Beijing Minhai Biotech, a subsidiary of Kangtai Biologics, is already in the application stage of drug registration approval, and according to the 2022 half-year report of Kangtai Biologics, it has completed the registration site verification and GMP compliance inspection, and will become a strong competitor of Kanghua Biologics when it is about to be listed. According to the information previously disclosed by Kangtai Biologics, the production capacity of the first phase of the product is about 8-10 million, and the second phase of the production capacity design can be expanded to 20 million.
For Kangtai Biologics' lyophilized human rabies vaccine (human diploid cells), Essence Securities said in commenting on Kangtai Biologics' 2022 half-year report that the lyophilized human rabies vaccine (human diploid cells) has completed registration on-site verification and GMP compliance inspection, and is expected to become the second third-generation rabies vaccine listed in China.
At the same time, Tianfeng Securities (601162) commented on Kangtai Biologics' 2022 half-year report, and also said that the lyophilized human diploid rabies vaccine has completed the registration site verification and GMP compliance inspection, and we expect to be approved by the end of 2022.
In addition to the three generations of the same vaccine fierce rival, there are currently other domestic companies with human rabies vaccines that are also accelerating. It is reported that Zhifei Biologics (300122) freeze-dried human rabies vaccine (MRC-5 cells) obtained a phase III clinical trial summary report in January this year, and the trial conclusion is that the vaccine has good immunogenicity and safety, fully meets the preset goals of clinical trials, is not inferior to the control vaccine in terms of safety and efficacy, and meets the design requirements of efficacy and safety evaluation in the "Technical Guidelines for Clinical Research of Human Rabies Vaccines".
Deppon Securities commented on the semi-annual report of Zhifei Biologics, saying that in terms of R&D product pipeline, it is expected that in 2022, there will be many catalysts landed, and the lyophilized human rabies vaccine (MRC-5 cells) and quadrivalent influenza vaccine have obtained the phase III clinical trial summary report, and we expect to report production soon.
(Image source: Juchao Information Network, Shenzhen Stock Exchange Interactive)
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