Slow growth of steady growth in pharmaceutical manufacturing

Talking about the pharmaceutical industry, many people feel more like real estate: profits. However, this may be a misunderstanding. From the semi-annual report data of major pharmaceutical listed companies this year, the pharmaceutical industry has maintained a steady growth, but the growth rate has slowed down. According to the 2014 semi-annual report of Huadong Medicine, the company's operating income for the first half of the year was 9.111 billion yuan, and net profit was 389 million yuan, up 12.41% and 16.94% over the same period of the previous year; and in 2013, the year-on-year increase was 15.03. %, 31.19%.

In the first half of 2014, the overall situation of the domestic pharmaceutical market was still severe due to the impact of medical insurance control fees, delays in provincial tenders, and new GMP reform inspections, and the growth rate slowed down. As the leading enterprise in Hangzhou's local pharmaceutical manufacturing industry, the semi-annual report of Huadong Medicine reflects the status of the entire industry. Internally improve performance, reduce production costs, strengthen new product development, innovate business models, transform traditional businesses into modern service industries, and strive to become a new type of business enterprise that can provide “integrated pharmaceutical solutions”. These actions of Huadong Medicine become the entire pharmaceutical industry. The transformation and upgrading of the industry.

In several domestic pharmaceutical companies listed on the A-share market, Xinfu Pharmaceutical's performance has increased significantly. In the semi-annual report released on July 31, the company achieved operating income of 438 million yuan, an increase of 29.99% over the same period of last year. According to the report, in the first half of 2014, the company mainly focused on the development of two industries: fine chemicals and new materials for energy saving and environmental protection. In particular, the sales price of calcium pantothenate, the company's leading product, has increased significantly since the price increase in November 2013. This has had a huge impact on the improvement of the performance in the first half of 2014.

Tiger Medical announced in its semi-annual report on August 8 that the company achieved operating income of 231 million yuan, an increase of 38.83% over the same period of last year; operating profit of 70,561,800 yuan, an increase of 30.94% over the same period of last year, the growth rate of profits slowed down. In the first half of last year, this indicator increased by 59.14%.

Yesterday, Dean Diagnostic issued a semi-annual report. During the reporting period, operating income was 625 million yuan, an increase of 35.22% over the same period of last year, and net profit was 62.585 million yuan, an increase of 38.02% over the same period of the previous year. In the first half of last year, these two indicators increased by 46% and 47.71% respectively. The growth rate has also slowed down significantly.

Due to the continuous influence of anti-commercial bribery, bidding, and control fees, in the first half of 2014, China’s pharmaceutical sales revenue and profit growth remained stable, up 13.53% and 14.88% year-on-year, but the growth rate was higher than in the first two years. Low, with an increase of 6.07 and 1.72 percentage points, respectively.

At present, Huadong Pharmaceutical's major projects in the first half of 2014 are progressing as planned. The new expansion project for Cordyceps fermentation raw materials in the East China and U.S. East China production sites has been successfully put into production. The expansion and transformation project of Acarbose has been basically completed; the production base construction project of Huadong Medicine (Hangzhou) Jiangdong Bailing Bio-Technology Co., Ltd. was officially established in February. Construction started, and infrastructure construction and main equipment tender procurement stage; Chinese Herbal Piece Expansion Project has been basically completed. The Jiangsu Jiuyang Biotechnology Co., Ltd. raw material transfer project has completed all the project infrastructure, and entered the verification and verification stage.

Slower growth rate is still optimistic about the overall trend

Qian Xiangjin, chief investment advisor of Zhejiang CITIC Securities, believes that the performance of Huadong Medicine in the first half of this year is very good. A major reason for the slowdown in growth rate is due to the cancellation of drug additions in Zhejiang Province this year and the implementation of a more stringent medical insurance control fee system, making the company's medicine The growth rate of commercial income declined by 5.53 percentage points from the same period of last year. In addition, the company’s core holding subsidiary’s 15% income tax concession for China and the United States East China expired at the end of 2013. In the first half of 2014, it temporarily withdrew income tax at a rate of 25%, resulting in a significant increase in income tax expenses. After qualifying for a new high-tech enterprise within the year, China Eastern The income tax will be settled at the tax rate of 15%.

In spite of this, Huadong Pharmaceutical Industry's performance was very gratifying. In the first half of the year, the company's pharmaceutical industry realized sales revenue of 1.963 billion yuan, up 30.51% year-on-year, and gross profit margin was 1.648 billion yuan, a year-on-year increase of 33.79% and a gross margin of 83.99%. In the same period, it increased by 2.06 percentage points and the performance exceeded expectations.

“The performance of several other pharmaceutical companies in Hangzhou is also quite good.” Qian Xiangjin said that, such as Tiger Pharmaceuticals, the prospects are very good. It has become the leader in clinical trial CRO in the Asia-Pacific region, and has cooperation with the world's largest pharmaceutical companies. Strong technical force, and take full equity incentives, he is very optimistic about its development prospects.

Dean Diagnostics also has its geographical advantages. On the one hand, it provides medical examination equipment for small and medium-sized hospitals, and it is the only company in Hangzhou listed pharmaceutical companies that can provide forensic authentication.

According to statistics, as of August 20, a total of 106 listed pharmaceutical companies in the two cities announced their transcripts in the first half of this year. Among them, 78 listed pharmaceutical companies achieved growth in performance, and 28 listed pharmaceutical companies saw different degrees of decline.

“This shows that the overall performance of the pharmaceutical industry is still very good, the future will continue to show a growing trend.” Qian Xiangjin said, but as the government to strengthen the health care costs and reduce drug prices, the pharmaceutical industry will also show a slowdown in growth the trend of. Those pharmaceutical companies with new sales models, innovative drugs, high-end medical services, and medical service extensions, such as East China Pharmaceutical, Dean Diagnostics, and Tiger Medical, will enjoy high-speed development.