Author:Yan Yan Hu Haoxiang
Editor's note: At present, we are entering the post-COVID-19 era. Under the background of the global industrial chain reform and economic growth adjustment, the domestic pharmaceutical and biological industry has ushered in a new round of structural changes: the epidemic has not yet ended, the medical and health demand is diversified, the medical reform is deepened, the scientific research is accelerated, and the capital pursuit is intertwined, while the leading and bearing role of important enterprises is prominent. Adhering to the long-term value of "growing with good industries and good companies", the Research Institute of Listed Companies in the Financial Industry launched the theme planning of "Focusing on Important Companies in the Domestic Pharmaceutical and Biological Industry: Profound Changes and Professional Development" to explore the strength and persistence, responsibility and challenges behind "important".
The aging of the population superimposes the upgrading of healthy consumption, and the vigorous development of household medical devices. Among the A-share listed companies, Yuyue Medical is one of the leading enterprises in the field of household medical devices.
After years of deep cultivation, Yuyue Medical business has continued to expand, and has established two major business sectors of home medical care and clinical medical treatment, with more than 600 kinds of product categories. Among them, home ventilators account for more than 40% of domestic brands exported. In 2020, when the epidemic broke out, Yuyue Medical made every effort to produce forehead thermometers, oxygen concentrators, ventilators and other epidemic prevention products to support the fight against the epidemic. At the capital market level, as of the close of trading on August 25, 2020, the total market value of Yuyue Medical was 36.5 billion yuan.
The product is nuclear: "epitaxial + endogenous" dual power
Founded in 1998, Yuyue Medical currently covers household medical and clinical medical treatment, and its products are mainly concentrated in the fields of medical respiration and oxygen supply, home medical treatment and chronic disease management, disinfection and infection control inside and outside the hospital, surgical and ophthalmic instruments and traditional Chinese medicine instruments.
Looking back at the development history of Yuyue Medical, epitaxial mergers and acquisitions have played an important role in promoting its development and growth.
In April 2008, Yuyue Medical was successfully listed on the Shenzhen Stock Exchange, becoming the first private enterprise in the national medical device industry to be listed in China. After the listing, with the help of the power of capital, Yuyue Medical carried out a series of mergers and acquisitions activities, and accordingly realized the rapid enrichment and improvement of the product line.
In 2009, Yuyue Medical incorporated Suzhou Medical Supplies Factory Co., Ltd., which has a history of more than 100 years, into the company system, completed the first merger and acquisition after listing, and laid out high-value medical consumables. At the end of 2019, the revenue scale of Suzhou Medical Supplies Factory exceeded 270 million yuan, and the net profit increased by nearly 20 times during the period.
A good start laid the foundation for subsequent investments and acquisitions. In the following two years, Yuyue Medical completed the acquisition of Shang machinery group and Shanghai Zhongyou. Among them, Shangji Group is one of the largest and most complete medical device production and marketing enterprises in China, and has a well-known domestic surgical instrument brand "Golden Bell". Through this acquisition, Yuyue Medical has further expanded the scale of its medical clinical business and further enhanced its industry position. Shanghai Zhongyou is a leading enterprise in the field of infectious disease prevention and control and infection control in china, and has a good brand accumulation in the field of hand and skin disinfection.
With the early experience of mergers and acquisitions, Yuyue Medical began to set its sights on overseas. In 2017, Yuyue Medical completed the acquisition of a 100% stake in Metrax GmbH in Germany, bringing under its wing, a defibrillation brand with a history of more than 40 years, Primedic. Mangis has advanced R&D technology, independent trademarks, patents and stable global agent network and international market channels in the field of defibrillation products, and the defibrillation monitoring and automatic external defibrillation (AED) series products have also obtained the China CFDA import product registration certificate, with a wide user base and a good product reputation. After the acquisition, the two will further synergize in terms of brands and channels.
At the same time as epitaxial expansion, Yuyue Medical continues to enhance endogenous power. It is understood that Yuyue Medical has set up R&D centers in Tuttlingen, China's Taipei, Shanghai, Nanjing, Suzhou and Danyang, and has established close technical cooperation with many well-known universities and research institutes in China. Up to now, Yuyue Medical has applied for 494 patents, including 93 invention patents, 215 utility model patents and 186 design patents; 305 valid authorized patents, including 20 invention exclusive rights, 154 utility model patents, 131 design patents; 32 computer software copyrights and more than 200 registered trademarks. It has 1 national key new product, 8 high-tech products in Jiangsu Province, and related products have passed CCC certification, SFDA, EU CE, US FDA, and Japan SG certification.
In terms of R&D investment, there is a fluctuating upward trend. Among them, the research and development expenditure in 2019 was 235 million yuan, an increase of 54.53% year-on-year. In absolute terms, R&D investment ranks 8th among the 71 A-share medical device companies that have been listed so far.
Drafting: Research Institute of Listed Companies in the Financial Industry Data Source: Juling Finance
Under the two-wheel drive of "epitaxial + endogenous", Yuyue Medical has formed a rich product system based on medical clinical, medical respiration and oxygen supply, and household medical treatment, covering many fields including medical equipment, medical consumables, medical hygiene materials, chronic disease monitoring, nursing equipment, respiratory system, etc.
Draft: Research Institute of Listed Companies in the Financial Sector Data Source: Public Information
According to the annual report, in 2019, Yuyue Medical's household medical products achieved sales revenue of 1.781 billion yuan, an increase of 16.14% year-on-year, accounting for 38.42% of the total revenue; medical clinical products achieved sales revenue of 1.229 billion yuan, an increase of 19.62% year-on-year, accounting for 26.52% of the total revenue; medical respiratory and oxygen products achieved sales revenue of 1.218 billion yuan, down 7.61% year-on-year, accounting for 26.28% of the total revenue.
Drafting: Research Institute of Listed Companies in the Financial Sector Data Source: Yuyue Medical Annual Report
Channel is king: brand building and marketing system construction
Relying on the huge investment in the sales end for a long time, Yuyue Medical has established an advanced marketing system, the brand awareness has been continuously improved, and the sales channels have been steadily expanded.
According to the annual report, at present, Yuyue Medical has several major brands such as "Yuyue Yuwell", "Huatuo Hwato", "Jinzhong JZ", "Jiefurou", "An er iodine", "Pumeikang PRIMEDIC" and so on. Among them, the Yuyue brand is mainly used for oxygen generators, electronic sphygmomanometers, ventilators, nebulizers, infrared thermometers and other medical devices; Huatuo brand is mainly used for acupuncture needles and other traditional Chinese medicine instruments, which was recognized as "China Time-honored Brand" by the Ministry of Commerce in 2011; Admiralty brand, mainly used for medical surgical instrument products; Jiefurou and Aner iodine are the first brands in the field of infection and control in domestic hospitals ;P automated external defibrillator (AED) and cardiac defibrillation monitoring products belonging to Rimedic P&M, a subsidiary of Mangiss, Germany, have a high reputation in the global medical emergency industry.
In terms of sales channels, the marketing system of Yuyue Medical Hospital and outside the hospital, online and offline, domestic and overseas has been continuously improved.
In the hospital, focusing on clinical applications, through the sales and after-sales engineer team, providing hospital infection control, surgical instruments, Traditional Chinese medicine instruments, AED emergency equipment and other products and solutions. At present, the products cover major hospitals in China, including Beijing 301 Hospital, Nanjing Drum Tower Hospital, Huashan Hospital Affiliated to Fudan University and other well-known domestic top three hospitals.
Outside the hospital, Yuyue has built a sales platform that goes hand in hand with offline and online. Among them, more than 700 channel and terminal teams, 1 global customer service center, 8 regional service centers and more than 1200 service outlets have been established offline. Online, as early as 2013, it set up an e-commerce department and set up a brand flagship store on mainstream e-commerce platforms such as Tmall, JD.com, and Suning Tesco. With the development of e-commerce, online channels have expanded rapidly, and sales of major products have climbed year after year, which has become its fastest growing sales channel. It is understood that the current online business contributes more than 25% of the total revenue of Yuyue Medical.
It is also understood that Yuyue Medical has set up overseas business departments and international business departments, and set up franchise stores in Thailand, Vietnam, South Korea, Saudi Arabia, Poland, Russia, Myanmar, Malaysia, Indonesia and other countries and regions, and the global sales network is still gradually expanding and improving.
With a rich product system and perfect channel construction, Yuyue Medical's revenue and profit have increased year by year. Among them, in 2019, the total operating income was 4.636 billion yuan, an increase of 10.82% year-on-year, and the net profit attributable to the mother was 753 million yuan, an increase of 3.49% year-on-year.
Facing the future: consolidating existing advantages and upgrading high-end products
In 2020, when the epidemic broke out, Yuyue Medical, as the first batch of key guarantee units for epidemic prevention and control materials announced by the Ministry of Industry and Information Technology, set up an epidemic prevention and control team at the first time, with Wu Guangming, chairman of the company, and Wu Qun, CEO, as the general commander, quickly formulated a special plan and emergency filing, and carried out a series of actions. During the epidemic period, Yuyue Medical donated and deployed emergency equipment to Wuhan for many times, including ventilators, oxygen concentrators, electronic sphygmomanometers, forehead thermometers, etc., and in order to ensure the operation of the equipment, the installation support engineers supported the hospital site in Wuhan and other cities with severe epidemics.
In addition, in order to ensure the supply of products, Yuyue Medical Production Line has been up all night to maximize production capacity and increase production. With the efforts of many parties, the production capacity of non-invasive ventilators has increased from 200 units / day to 1500 units / day, the production capacity of medical forehead thermometers has increased from 4000 units / day to 32000 units / day, and the output of disinfection and infection control products has increased from 6 tons / day to 80 tons / day. According to incomplete statistics, as of now, Yuyue has provided more than 15 million infrared thermometers, electronic thermometers and mercury thermometers to more than 70 countries around the world, hundreds of thousands of non-invasive ventilators, oxygen concentrators, nebulizers and other respiratory treatment equipment, and more than 7,000 tons of infection control disinfection products, which has strongly supported the prevention and control of the global epidemic.
While assuming social responsibility, the production of epidemic prevention products has also brought economic benefits to enterprises. According to the data in the report, in the first half of 2020, Yuyue Medical achieved a total operating income of 3.421 billion yuan, an increase of 36.74% year-on-year, and achieved a net profit attributable to the mother of 1.119 billion yuan, an increase of 109.86% year-on-year, the highest increase since the listing of the same period, laying the foundation for the annual performance growth. In addition, Yuyue Medical non-invasive ventilators have obtained emergency use authorization issued by the US FDA, and with the export of products, the popularity and influence of the yuwell brand overseas have been further enhanced.
At the same time, the epidemic has also made some problems in the industry more obvious, such as the low localization rate of high-end devices and core components, and the need for breakthroughs in technology.
According to the interim report, with the effective control of the epidemic, the routine sales of Yuyue Medical have resumed. Facing the future, on the basis of consolidating the advantages of existing brands and channels, it will continue to improve the integration ability after mergers and acquisitions to achieve synergy between the acquisition target and its own business, strengthen R&D innovation, and upgrade to high-margin, high-value-added high-end device products will be its breakthrough direction.