The API business has brought performance growth to many pharmaceutical companies, which has attracted the efforts of enterprises

【Pharmaceutical Network Industry News】Recently is the third quarter performance data disclosure period of listed pharmaceutical companies, from the released data, in the first three quarters of this year, the API business has brought performance growth to many pharmaceutical companies, including Haite Biologics, Onlikang and so on
.
On October 24, Onlikang released the third quarter report of 2022, in the first three quarters of 2022, the company achieved operating income of 1.
063 billion yuan, an increase of 7.
72% over the same period of the previous year; The net profit attributable to shareholders of listed companies was 108 million yuan, an increase of 44.
00%
over the same period of the previous year.
The Company attributed the increase in performance to the increase in gross profit of its API business and increased
investment income during the reporting period.
On the same day, Haite Biotech released a report for the third quarter of 2022, in the first three quarters of 2022, the company obtained operating income of 547 million yuan, an increase of 39.
32% over the same period of the previous year; The net profit attributable to shareholders of listed companies was 18.
82 million yuan, an increase of 1% over the same period of the previous year.

This was mainly due to the increase in
the API and intermediates business during the reporting period.
Also driven by APIs and other businesses, Jiuzhou Pharmaceutical's net profit in the first three quarters of this year is expected to exceed 700 million yuan, a year-on-year increase of 260 million yuan to 284 million yuan, an increase of 55% to 60%.

In addition, Huahai Pharmaceutical mentioned in its semi-annual report that in the first half of this year, Huahai Pharmaceutical's API and intermediates business achieved sales revenue of 1.
552 billion yuan, a year-on-year increase of 20.
28%.

The company achieved double growth in performance in the first half of the year, achieving revenue of 3.
823 billion yuan, a year-on-year increase of 25.
97%, and non-net profit of 583 million yuan, a year-on-year increase of 223.
83%.

It can be seen that the API business is bringing performance growth
to many pharmaceutical companies.
From the perspective of the development of the entire industry, in recent years, there has been overcapacity in the domestic API industry, resulting in the market price of related products going all the way down, manufacturers have bid at low prices, and API manufacturers have entered the field of
preparation.
Since 2020, affected by the epidemic, the demand for APIs at home and abroad has been strong, and the demand for some APIs has rebounded, which has brought performance growth
to related enterprises.
Since 2022, a large number of pharmaceutical companies have made efforts to accelerate the expansion of API business
.
For example, Onlikang recently announced that it intends to acquire 38.
22% of the shares of Kerui Biologics with its own or self-raised funds of
191 million yuan.
The company said that according to the plan, Kerui Biotech's existing business will slowly change to GMP-compliant API business, and after the completion of this acquisition, Kerui Biotech will be an important part of
the listed company's featured API business.
Related New Materials mentioned in an exchange with institutions in September that medicine is also the company's core business, and the current products are mainly intermediates, which will accelerate the construction of GMP factories and actively expand the API business
。 For example, in March, the company obtained the authorization of Pfizer's Paxlovid Drug Patent Pool (MPP) to produce both Paxlovid APIs and preparations; On August 18, Huahai Pharmaceutical further announced that it had signed a "production and supply master agreement" with Pfizer, and the company will provide contract production services
for Paxlovid sold by Pfizer in the Chinese mainland market during the agreement period (5 years).
Founder Securities believes that the gross profit margin of APIs is gradually recovering to the inflection point of performance, the valuation of the sector is at the bottom or the performance inflection point is in 2023, and the targets that are expected to grow high include Propharmaceutical, Jincheng Pharmaceutical, Jianyou Shares, Hepalink, Tianyu Shares, etc
.
Another view said that in the next three years, the increase in patented drugs with expiration risks, coupled with the transfer of overseas outsourcing industries, is an opportunity for
China's API enterprises.
According to a report by Mordor Intelligence, the global API market size was about $174.
96 billion in 2020 and is expected to reach $245.
88 billion by 2026, with a projected compound annual growth rate of 5.
84%
from 2021 to 2026.
Disclaimer: Under no circumstances does the information or opinions expressed in this article constitute investment advice
to anyone.