Reporter Yan Guowen and Cao Xueping report from Beijing
On the evening of April 17, Hengrui Pharmaceutical (600276. SH) disclosed its financial data for 2023: operating income of 22.82 billion yuan, a year-on-year increase of 7.26%, and net profit attributable to shareholders of listed companies of 4.302 billion yuan, a year-on-year increase of 10.14%.
In 2023, Hengrui Pharmaceutical's innovative drug revenue will exceed 10 billion yuan, reaching 10.637 billion yuan (including tax, excluding external licensing revenue), achieving a year-on-year growth of 22.1%.
Hengrui Pharmaceutical continued to maintain a high level of R&D investment, with a cumulative R&D investment of 6.15 billion yuan during the reporting period, of which the expensed R&D investment was 4.954 billion yuan. At present, Hengrui Pharmaceutical has 14 self-developed innovative drugs and two cooperative innovative drugs approved for marketing in China.
The reporter of "China Business Daily" learned that scientific and technological innovation and internationalization are the two core strategies of Hengrui Pharmaceutical. In the list of "2023 Hurun Global 500" released at the end of January this year, Hengrui Pharmaceutical ranked 366th, up 47 places.
Last year, the cumulative R&D investment was 6.15 billion yuan
According to the therapeutic field, Hengrui Pharmaceutical's products are mainly divided into anti-tumor, analgesic anesthesia, contrast agents and others, and the operating income of the corresponding business segments in 2023 will be 12.22 billion yuan, 3.74 billion yuan, 2.74 billion yuan and 3.67 billion yuan respectively.
During the same period, Hengrui Pharmaceutical also disclosed its first quarter report for 2024. During the reporting period, Hengrui Pharmaceutical achieved operating income of 5.998 billion yuan, a year-on-year increase of 9.2%, net profit attributable to shareholders of listed companies of 1.369 billion yuan, a year-on-year increase of 10.48%, and non-net profit attributable to shareholders of listed companies of 1.44 billion yuan, a year-on-year increase of 18.06%.
In the first quarter of 2024, Hengrui Pharmaceutical's R&D expenses will be 1.22 billion yuan, and the transformation of innovative R&D achievements will be accelerated. In terms of new drug approval, Hengrui's self-developed Class 1 new drug Tegilidine Fumarate Injection was launched for the treatment of moderate to severe pain after abdominal surgery. The product is the first class 1 opioid analgesic innovative drug independently developed in China, providing a new treatment option for patients suffering from postoperative pain.
In 2023, Hengrui Pharmaceutical's cumulative R&D investment will be 6.15 billion yuan, and R&D investment will account for 26.95% of sales revenue. Hengrui Pharmaceutical has set up 14 R&D centers in Lianyungang, China, Shanghai, the United States and Europe, with a global R&D team of more than 5,000 people.
In 2023, Hengrui Pharmaceutical will have 3 Class 1 innovative drugs (adebelimab, repagliptin phosphate, and oticonazole) and 4 Class 2 new drugs (dexmedetomidine hydrochloride nasal spray, abiraterone acetate nanocrystal, irinotecan hydrochloride liposome, and hengagliflozin metformin extended-release tablets) approved for marketing. Up to now, Hengrui Pharmaceutical has been approved for marketing 16 Class 1 innovative drugs and 4 Class 2 new drugs in China.
As of the end of 2023, Hengrui Pharmaceutical has applied for a total of 2,389 invention patents, 662 PCT (Patent Cooperation Treaty), 545 domestic valid authorized invention patents, and 667 foreign authorized patents in Europe, the United States, and Japan.
In 2023, the regulatory policies of the pharmaceutical industry will be strengthened, and the uncertainties affecting the development of the industry will increase.
Hengrui Pharmaceutical's generic drug revenue will decline slightly in 2023. According to its annual report, the main reason is that with the recovery of diagnosis and treatment in medical institutions, the demand for prescription drugs has been gradually released, and the sales of the company's analgesic anesthesia and other products and newly listed generic drugs have increased significantly year-on-year, but the centralized procurement of generic drugs still causes a certain degree of pressure on sales, and the second batch of centralized procurement involves products such as paclitaxel for injection (albumin-bound) and abiraterone acetate tablets due to factors such as the failure to win the bid and price reduction in most provinces, and the sales volume decreased by 702 million yuan year-on-year during the reporting period. In addition, the sales volume of the seventh batch of products involved in centralized procurement, which began in November 2022, decreased by 911 million yuan year-on-year during the reporting period.
The total value of the out-licensing transaction exceeded US$4 billion
In 2023, Hengrui Pharmaceutical has reached a total of 5 external licensing cooperation agreements with international pharmaceutical companies, with a total transaction value of more than US$4 billion. Up to now, Hengrui Pharmaceutical has achieved 10 overseas authorizations for innovative drugs.
In February 2023, Hengrui Pharmaceutical licensed its self-developed EZH2 inhibitor to Treeline Biosciences in the United States for a fee, SHR2554 global rights and interests except for Greater China.
In August 2023, Hengrui Pharmaceutical licensed the global rights and interests of the self-developed thymic stromal lymphopoietin (TSLP) monoclonal antibody except for Greater China to One Bio, Inc. of the United States (the company has been acquired by GlaxoSmithKline GSK) for a fee.
In October 2023, Hengrui Pharmaceutical has 3 authorized cooperations. Hengrui Pharmaceutical has licensed the exclusive rights to develop and commercialize its self-developed human epidermal growth factor-targeting drug pyrotinib in India to Dr. Reddy's (Dr. Reddy's Laboratory) for a fee. Hengrui Pharmaceutical licensed its self-developed PD-1 inhibitor camrelizumab liver cancer combination therapy to Elevar Therapeutics in the United States for a fee. In addition, Hengrui Pharmaceutical has also cooperated with Merck Healthcare (Merck, Germany), mainly involving the self-developed PARP1 small molecule inhibitor HRS-1167 and the antibody-drug conjugate SHR-A1904 targeting Claudin 18.2.
The first quarter 2024 report discloses the progress of the licensing partnership with Merck Healthcare. During the reporting period, Hengrui Pharmaceutical Company received a down payment of 160 million euros from the company for external licensing, and the relevant performance obligations have not yet been completed, and the relevant revenue has not yet been recognized.
"Scientific and technological innovation is not only the company's long-term development strategy, but also a powerful engine for the company's long-term development. Hengrui Pharmaceutical said in its annual report that innovative drugs are an industry led by science and technology and driven by innovation. Under the current background of "dual circulation", the national innovative drug industry going overseas, actively participating in international competition and optimizing the international division of labor is not only the development choice of the enterprise itself, but also the specific practice of supporting the construction of an innovative country.
Hengrui Pharmaceutical said that the company will actively comply with the new requirements of the development of the mainland pharmaceutical industry and the new trend of international industrial evolution, accelerate the construction of technology platforms, continuously improve product quality, gradually narrow the gap with the international advanced level, cultivate high-end brands, open up the global market, promote the transformation and upgrading of enterprise development, and create an export-oriented economic growth pole.
Specifically, the first is to continue to strengthen the global sales of domestic preparations by taking the export of preparations that have reached the international advanced level through European and American certification as a breakthrough; the second is to take market demand as the starting point, while deeply cultivating the domestic market, strengthen exchanges and cooperation with multinational pharmaceutical companies from a global perspective, actively learn advanced practices in cooperation, accumulate experience for the ultimate realization of global sales of innovative drugs, and strive to make the company win a place in the new round of global pharmaceutical competition; third, it is necessary to actively implement the "bring in, go out" At the same time, we strive to license our scientific research results to multinational companies to achieve "China + overseas" dual market returns.
(Editor: Cao Xueping Review: Tong Haihua Proofreader: Zhai Jun)