Against the backdrop of a weak economic environment in 2023, the medical aesthetic industry has shown strong growth momentum. In 2023, Sihuan Pharmaceutical's medical aesthetic business revenue and profit will both achieve high growth, with revenue of 450 million, a year-on-year increase of 200%, and a segment profit of 90 million, a year-on-year increase of 2450%.
However, the company not only shines in the high-growth medical aesthetic track, but also a number of products in its innovative drug business will also usher in an intensive harvest period during the year, revealing the dual characteristics of high growth and high value.
In addition, from the perspective of investment, Sihuan Pharmaceutical currently has a significant margin of safety, and its diversified layout of medical cosmetology + innovative drugs + generic drugs also meets the dual needs of investors for diversified growth and risk diversification.
Medical cosmetology|All-round layout, first-mover advantage of botulinum toxin in the card position, and the combination of hyaluronic acid to expand the blue ocean of medical cosmetology
The company's medical aesthetic platform "Miyan Space" has a wide range of products, with a total of more than 40 self-developed and exclusive agent products, including more than 10 self-developed products of Class III and more than 20 self-developed products of Class II.
Specifically, it includes a variety of high-quality medical aesthetic products such as filling, shaping, support, supplement, optoelectronic equipment, body carving and skin management, providing beauty lovers with medical aesthetic solutions covering the whole life cycle.
Source: Company information, compiled by Gelonghui
Among them, in the field of filling, the company's exclusive agent Hugel's hyaluronic acid product Bo Anrun has been successfully listed, the company's self-developed compound collagen filler, Tongyan Injection, and Maiden Injection have entered the clinical stage and pre-registration stage respectively, and the clinical progress of the Korean collagen products represented by the company is also steadily advancing;
In addition, in March this year, the company was the exclusive agent of South Korea's VIOL's dual-wave radiofrequency therapy device Sylfirm X, which is the world's first dual-wave radiofrequency therapy device approved by both FDA and NMPA, with multiple effects including facial and body firming and lifting, stretch marks, acne scars, melasma, hair regrowth and so on.
The diversified matrix formed by a variety of listed products has become a new engine to promote the growth of enterprise value. Moreover, the new trend shows that the medical aesthetic industry is upgrading in the three directions of collagen, botulinum toxin and weight loss drugs, and Sihuan Pharmaceutical has a layout, and the progress is at the forefront.
Good products need good channels, and the promotion and sales of medical aesthetic products need to be carried out to B-end doctors and medical aesthetic institutions first, and then influence C-end consumers through them.
In terms of channels, the company has comprehensively strengthened cooperation with leading group hospitals and regional leading institutions through the optimization of direct sales + agency marketing strategy. The city covers 350+, the medical institutions cover 4700+, the top 500 medical institutions have achieved full coverage, and strategic cooperation with 680 large and medium-sized medical aesthetic hospitals and chain institutions.
Source: Company information, compiled by Gelonghui
Through the active adjustment of sales models and channels, the performance of the medical aesthetic division will grow explosively in 2023, and the proportion of overall revenue will also increase by 17.3 percentage points, further highlighting the strategic position of medical aesthetics.
Source: Company information, compiled by Gelonghui
Pharmaceutical business|A number of generic drugs were launched during the year, and innovative drugs gradually emerged
In addition to the medical aesthetic business under the spotlight, the company's pharmaceutical business upgrading and transformation is also making steady progress, among which the generic drug business is the company's stable "cash cow" business, which continues to provide the company with stable fundamentals, and the company's innovative drug business focusing on long-term value is also gradually showing its edge.
During the year, 13 generic drugs were approved for marketing and 8 products were included in the National Medical Insurance Catalogue, which injected new vitality into the company's pharmaceutical business revenue and further strengthened its position as a stable profit and cash flow.
In addition, the innovative business is operated by its two innovative drug platforms, Huisheng Biotech and Xuanzhu Biotech, with a total of more than 60 innovative drugs/biologics pipelines, covering multiple high-potential areas such as diabetes, weight loss, breast cancer, and tumors.
Source: Company information, compiled by Gelonghui
As mentioned above, the layout of semaglutide is developed by Huisheng Biotechnology.
At present, Huisheng Biotech is one of the few companies in China that has achieved full product coverage and integration of research, production and marketing in the field of diabetes and complications.
In 2023, a total of 7 drugs, including insulin aspart injection, insulin aspart 30 injection and insulin aspart 50 injection, were successfully approved, in addition, a total of 5 drugs including insulin degludec aspart injection were successfully declared.
Source: Company information, compiled by Gelonghui
Xuanzhu Biotech is one of the companies with the most comprehensive layout on the breast cancer track in China, and has both small molecule and large molecule biological drug research and development capabilities.
In 2023, the company's self-developed proton pump inhibitor (PPI) aneprazole sodium enteric-coated tablets were approved for marketing, and were successfully included in the national medical insurance catalog in the same year. According to statistics, in the first half of 2023, there are 4 PPI products with sales of more than 1 billion yuan in the grade hospital and retail market. Among them, the PPI innovative drug ilaprazole ranked first in sales, with sales of 1.726 billion yuan. Aneprazole sodium is a new generation of PPI innovative drugs, which is expected to bring a larger market;
Piroctinib (CDK4/6 inhibitor) for patients with HR+/HER2- advanced breast cancer and advanced prostate cancer has BIC potential. Among them, the NDA application for the second line of single-drug end-line and combined with fulvestrant injection for the treatment of advanced breast cancer has been accepted by the NMPA (China National Medical Products Administration), and it is expected to become the first and only single-drug end-line effective product for HR+/HER2- advanced breast cancer patients in China after marketing, and will be one of the blockbuster varieties for the treatment of breast cancer in the future.
Source: Company information, compiled by Gelonghui
It is precisely because of the company's high potential in the field of innovative drugs that the innovative drug business has been favored by investors in recent years. In 2023, Huisheng Biotech will complete 580 million yuan of A+ round of financing, with an overall post-investment valuation of 5.58 billion yuan.
Judging from the valuation of the company's innovative drug subsidiaries, any valuation has exceeded the overall market value of Sihuan Pharmaceutical, and there is an obvious inversion.
epilogue
In addition, the company's cash and cash equivalents, wealth management products, and time deposits totaled 4.611 billion yuan, and its net assets were 5.14 billion yuan, all of which exceeded the current market value of the company, providing investors with a sufficient margin of safety.
With generic drugs as the cornerstone and stable fundamentals, with the continuous growth of the company's high-growth medical aesthetic business and the acceleration of the realization of the high-value innovative drug business, the company will usher in a profit inflection point.