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On April 23, vaccine leader Zhifei Biotech (300122. SZ) released its annual report, with revenue of 52.918 billion yuan in 2023, a year-on-year increase of 38.30%, net profit attributable to shareholders of listed companies of 8.070 billion yuan, a year-on-year increase of 7.04%, net profit after deducting non-profits of 7.915 billion yuan, a year-on-year increase of 5.4%, basic earnings per share of 3.36 yuan, a year-on-year increase of 7.04%, and as of the end of 2023, the company's net operating cash flow was 8.996 billion yuan, a year-on-year increase of 352.30%.
Judging from the data in the first quarter, the company's performance has declined to a certain extent, mainly due to the impact of HPV vaccine batch release. Looking forward to 2024, the company's blockbuster product recombinant herpes zoster vaccine Xin'an Lishi ® is about to be scaled up, which is expected to further increase the company's performance.
Based on confidence in future development, Zhifei Biotech has given an annual dividend plan of 10 distributions of 8 yuan in 2023, with a cash dividend of 1.915 billion yuan.
Affected by the batch issuance of HPV vaccines, the performance in the first quarter declined
According to the data of the first quarterly report, Zhifei Biotech achieved revenue of 11.396 billion yuan in the first quarter, a year-on-year increase of 2%, and net profit and net profit after deducting non-profits in the same period were 1.458 billion yuan and 1.455 billion yuan respectively.
The decline in profit in the first quarter was mainly due to the structural change of HPV vaccine products. According to the information of the Central Institute for Inspection and Quarantine, the batch release of 4-valent HPV vaccines in 2023 will be declining, which is the first decline since the launch of 4-valent HPV vaccines.
According to the 2023 annual report, the batch release of the company's Jiadaxiu 9® (nine-valent HPV vaccine) has increased significantly, and the batch release of "Jiadaxiu 4®" (4-valent HPV vaccine) has decreased by 26.27% year-on-year.
Titanium Media APP noticed that in the face of the fierce market competition of HPV vaccines, Merck (MRK.US) has taken frequent actions since last year, from applying to the Food and Drug Administration to expand the male indication to optimizing the vaccination procedure for women aged 9-14, all kinds of measures are demonstrating Merck's determination to strengthen the market competitiveness of the Jiadaxiu brand.
According to the purchase agreement signed between Zhifei Biotech and Merck, the basic procurement amount of HPV vaccine in 2024 will be 32.626 billion yuan, which is the highest basic procurement amount in recent years. Therefore, in the context of Merck's efforts, from the perspective of the amount of basic purchase agreements, the sales of HPV vaccines represented by Zhifei Biotech are expected to further increase in 2024.
The purchase amount of HPV vaccines comes from the announcement of Zhifei Biotech
Based on the good performance in 2023 and responding to the call of investors to return to the company, Zhifei announced the dividend plan for 2023 and intends to submit it to the general meeting of shareholders to authorize the board of directors to make the 2024 interim profit distribution plan. In 2023, the company plans to distribute a cash dividend of 8.00 yuan (tax included) to all shareholders for every 10 shares based on about 2.394 billion shares, with a total cash dividend of 1.915 billion yuan.
At the same time, Zhifei Biotech intends to submit to the general meeting of shareholders to authorize the board of directors to formulate a medium-term profit distribution plan for 2024, with a cash dividend of not less than 2 yuan (inclusive) to all shareholders for every 10 shares. If calculated based on the lower limit of the minimum total amount of dividends, after the implementation of equity distribution is completed, Zhifei will actually distribute cash dividends of no less than 10 yuan to all shareholders for every 10 shares in 2024, and 2024 will become the year with the highest actual cash dividend amount in the history of Zhifei Biotech.
It is worth mentioning that Zhifei Biotech has implemented cash dividends for 14 consecutive years since its listing, and when the cash dividends in 2023 are completed, the cumulative cash dividends will reach 6.839 billion yuan, which is 4.7 times the net amount of funds raised in the initial offering.
In the first quarter of this year, the company implemented a share repurchase of more than 300 million yuan, all of which were used to cancel and reduce the registered capital, which has been fully implemented.
The recombinant herpes zoster vaccine is about to be increased and is expected to increase performance
In October last year, Zhifei Biotech signed an "Exclusive Distribution and Joint Promotion Agreement" with GSK, under which GSK will exclusively supply recombinant herpes zoster vaccine to Zhifei. Since this product is a blockbuster vaccine variety in the world, it is highly anticipated by the market.
Titanium Media APP learned that GSK's recombinant zovirus vaccine is called Shingrix ®, which was approved by the FDA in 2017 and is mainly used for the prevention of zoster in adults aged 50 and above. Clinical studies have shown that it is 97.2% effective in people over 50 years old and 91.3% in people over 70 years old. Synion is ® the second product to be launched globally after the launch of Merck's Zostavax, which was launched in China in June 2020.
From a global perspective, Xin'an Lishi ® has become GSK's "cash cow" soon after its launch, and sales have continued to grow, with sales of this product reaching £784 million, £1.8 billion, £19.89, £1.721 billion and £29.58 respectively from 2018 to 2022.
By 2023, the sales of Xin'an Lishi ® will reach 3.446 billion pounds (about 30.911 billion yuan), a year-on-year increase of 17%, and it is GSK's highest-selling blockbuster product.
Domestically, Baike Biotechnology (688276. SH) launched the herpes zoster vaccine in April last year, which ® is verifying the domestic market. In 2023, the company's shingles vaccine will achieve revenue of 883 million yuan and sales of 663,500 pieces.
In contrast, Xin'an Lishi ®, which adopts the recombinant technology route, has a higher protection rate. The results of the first protective efficacy study of recombinant herpes zoster vaccine (CH0 cell) in China showed that Xin'an Lishi ® had 100% protective efficacy against adults aged 50 years and above in Chinese mainland. GSK's latest data from the long-term follow-up Phase III clinical trial of ZOSTER-049 showed that the vaccine was 82.0% effective 11 years after the vaccine.
At present, Zhifei Biotech and GSK have completed the pre-order preparations, and the product is expected to start to grow in volume in the second quarter of this year. According to public data, from February 26, 2024 to March 3, 2024, the recombinant herpes zoster vaccine obtained the first batch issuance certificate this year. Up to now, Zhifei has obtained batch issuance of 18 batches of herpes zoster vaccine.
Zhifei Biotech also said in the annual report: "In the first year of the company's agent sales of GSK recombinant herpes zoster vaccine, the company will actively complete the annual promotion target and lay a solid foundation for long-term cooperation between the two sides." ”
On the sales side, the growth rate of HPV vaccine in China in recent years is enough to prove the strength of Zhifei's sales channels. By the end of 2023, the number of sales personnel of Zhifei Biotech has reached 3,990, and the company has the market coverage capacity of more than 30,000 grassroots vaccination sites across the country.
According to the "Exclusive Distribution and Joint Promotion Agreement" signed between Zhifei Biotech and GSK, the minimum annual purchase amount of recombinant herpes zoster vaccine from GSK from 2024 to 2026 will be 3.44 billion yuan, 6.88 billion yuan and 10.32 billion yuan respectively, with a total of no less than 20.64 billion yuan in three years.
The purchase amount of recombinant herpes zoster vaccine comes from the announcement of Zhifei Biotech
In other words, the basic procurement amount of recombinant herpes zoster vaccine superimposed on HPV vaccine, the purchase amount of Zhifei's blockbuster products in 2024 will exceed 35 billion yuan, plus the agency products such as pentavalent rotavirus vaccine and 23-valent pneumonia vaccine, as well as the sales of the company's self-developed products, etc., may support the company's performance in 2024.
In addition to the recombinant herpes zoster vaccine, Zhifei Biotech is also constantly expanding its business territory and creating a new growth curve. In November last year, the company planned to acquire 100% of the shares of Chenan Biotech, and after the acquisition is completed, the company's business will expand to the field of metabolic diseases such as diabetes and obesity. Judging from the high performance and market value of foreign weight loss drug giants Novo Nordisk (NVO.US) and Eli Lilly (LLY.US), this is undoubtedly another potential business segment.
(This article was first published in the Titanium Media APP, by |.) Zhang Haixia)