This CRO head company has recently frequently acquired companies to further expand its business scale

Recently, Zhaoyan New Drug, a leading CRO company, announced that the company will enter into a Weimei equity transfer agreement with Guanfang Group and Xieer Yunkang on April 28, 2022.
The latter agreed that the company plans to acquire 60% of Weimei Biotechnology for 975 million yuan.
and 40% equity interest
.
The announcement shows that Weimei Biotechnology is a supplier of Zhaoyan New Drug, and its main business is the breeding and sales of laboratory experimental models
.
On the same day, the company announced that the company (as the buyer) and Yingmao Group (as the seller) entered into an equity transfer agreement of Yingmao, pursuant to which Yingmao Group agreed to sell the entire equity interest of Yingmao Biotechnology to the company for 820 million yuan
.
The announcement disclosed that Yunnan Yingmao Biotechnology Co.
, Ltd.
is a limited company legally established and validly existing in accordance with Chinese laws.
Its main business is the breeding and sales of laboratory experimental models
.
As of the date of this announcement, Yingmao Biotechnology is wholly-owned by Yingmao Group
.
It is understood that the experimental model is mainly engaged in the domestication of experimental animals, artificial breeding and reproduction, research and development of disease animal models and other related products and services
.
Experimental model products and services mainly serve downstream medical scientific research and pharmaceutical institutions, and are used to carry out experimental model-based medical research, drug quality inspection, biological product manufacturing, pharmacological and toxicological tests,
etc.
The main markets are major pharmaceutical R&D institutions, non-clinical CROs, and medical university laboratories
.
The industry points out that the importance of experimental models as a supporting service for the biomedical research and development industry is self-evident.
In recent years, the rapid expansion of the biomedical research and development market has driven the rapid development of the experimental model industry
.
Coupled with the industrial transformation of China's biomedicine in recent years, the scale of independent research and development of drugs has continued to increase, and the demand for domestic experimental model products and services has also continued to increase
.
According to the latest report of Frost & Suivan, the market size of China's experimental model has reached about 400 million US dollars in 2019.
It is expected that the market size will reach 1.
5 billion US dollars in 2024, and the compound annual growth rate from 2019 to 2024 will reach about 28.
1%.

.
Focusing on the sub-segment of CRO, from the perspective of the current supply bottleneck, the shortage of experimental animals used in the core safety assessment link in the preclinical stage has driven the price increase, and the cost of the preclinical stage has also increased
.
According to public information, Zhaoyan New Drug is a Chinese company mainly engaged in the pharmacology and toxicology research of new drugs
.
Non-clinical research services include drug safety evaluation, pharmacokinetic studies, and pharmacology and pharmacodynamic studies
.
Clinical trials and related services include clinical contract research organization services, Phase I Clinical Research Collaborative Units (CRUs), and bioanalytical services
.
The experimental model business mainly includes rodents and non-human primates
.
From the perspective of Zhaoyan New Drug’s revenue, it mainly includes preclinical research, clinical trials and sales of experimental animals, of which preclinical research is the main one, accounting for 97.
86% of revenue in 2021, while clinical trials, experimental animals and sales of ancillary products less proportion
.
For this acquisition, the company believes that it will help the group meet the needs of further expansion of the business scale and enhance the group's contract research organization service capabilities
.
In addition, the acquisition can bring synergies to the Group's business through upstream vertical integration, reduce the risk and any negative impact that may arise from the supply disruption of experimental models, and the price of laboratory-based experimental models is on an upward trend, the acquisition can achieve Better cost control
.
Disclaimer: Under no circumstances does the information or opinions expressed in this article constitute investment advice to anyone
.