Data Support | Pythagoras Big Data
It seems that the year of medical reform continues. Recently, the Ministry of Finance has audited 77 pharmaceutical companies, the DRGs pilot of the Medical Insurance Bureau has been expanded, and the State Council has issued the Key Tasks for Deepening the Reform of the Medical and Health System in 20 19 years. Supporting policies such as drugs, consumables and medical services have been introduced one after another, and the risk aversion has deepened under uncertainty. At this time, it is more important to choose industries with high certainty, and CRO is one of them. Under the data after the performance period,
1
What is CRO?
Cro (Contract Research Institute) is an R&D outsourcing organization. Generally speaking, it is the pharmaceutical R&D outsourcing industry, which usually serves large enterprises and pays by project or per head. The difference is that in terms of manpower, CRO requires higher academic qualifications and higher demand for technology; But the labor cost is not as big as other outsourcing companies (such as software outsourcing companies). The labor cost of software outsourcing companies is above 80%, which is basically a human activity, but the manufacturing cost of CRO companies is basically 30~40%, accounting for the remaining 30%, so the sensitivity of CRO companies to personnel costs is relatively weak in the industry.
The whole process of drug research and development consumes a lot of money and events. It may take pharmaceutical companies more than 65,438+00 years and an investment of more than 6,543,850 billion dollars to advance pharmaceutical compounds from the discovery stage to the commercial approval stage. This process is also full of risks, and the average success rate of commercial approval of pharmaceutical compounds in the United States is less than 0.0 1%. The main reason why pharmaceutical companies gradually cooperate with CRO is that, on the one hand, it can save costs and reduce the overall research and development costs related to drug research and development. On the other hand, we can develop professional knowledge and customize the efficiency of development and execution. There are many kinds of outsourcing services, which help to improve the implementation efficiency in the process of drug development and provide customized and scientific research, analysis and development services for pharmaceutical companies in the most important drug development challenges. Most importantly, it can reduce risks, and outsourcing to reliable and reputable partners can reduce the overall risks related to drug development.
R&D is mainly divided into four stages: discovery, preclinical trial and development, clinical development (such as phase I-III clinical research) and approved clinical research (such as phase IV clinical research). Let's take a look at popular science first. Generally, in the early stage of discovery, in the stage of drug discovery, research services focus more on identifying potential effective compounds and lead compounds for further testing as candidate drugs for further research and development. Drug discovery, target and lead compound identification, target generation and optimization are needed. In the second preclinical stage, the main research, analysis and development services include studying the interaction of these candidate drugs in biological matrix, studying how the candidate drugs pass through and affect the living body, studying the active components of drugs and final drugs, the design and dosage forms of drugs, and improving the scientific understanding of drugs and their efficacy, efficacy and toxicity through analysis and development, so as to optimize the candidate drugs and further carry out human trials. Then enter the clinical stage (I-III and after approval). In the clinical stage, services include the production of clinical trial materials (for example, capsule or liquid versions of drugs given to human trial participants), professional clinical trials of healthy volunteers and/or patients, statistical data generation and analysis, and regulatory submission assistance (for example, bioequivalence identification of generic drugs). Provide bioanalysis and biometrics services, phase I, II and III clinical trials and data management, bioequivalence research, chemistry, manufacturing and control services. When it comes to registration, you need to apply for registration twice (for example, the United States and China). After successful clinical trials, contract research institutions can assist their clients in drug registration by providing registration and application services.
2
The rise of CRO
Because the United States entered the stage of drug research and development earlier, the rise of CRO is actually the product of industrial upgrading. 1993~2008, generic drugs entered the harvest period, a large number of generic drugs were listed, the market share of cheap generic drugs increased rapidly, and the industry entered a high growth period, but it also brought a lot of pressure to innovative drug companies, which brought business opportunities to CRO under the background of reducing the R&D cost of pharmaceutical companies. As an auxiliary organization of outsourcing R&D, it can effectively disperse the capital investment and potential risks of new drug research and development, and the efficiency can be shortened by about 20~30% compared with the clinical trials conducted by pharmaceutical companies themselves. Therefore, in order to reduce the risk of failure of new drug research and development, many pharmaceutical companies will complete drug screening and R&D with relatively low cost and high efficiency, then they will outsource R&D to CRO company. Kuntai and cowans, the industry leaders, developed rapidly during this period. At present, the global market share (20 17) is big brother Kuntai 13%, cowans 6% and PPD 6%.
The domestic process is slow. Historically, the share of generic drugs in China's pharmaceutical market is greater than that in the global market. According to the data of 20 18, the market size of generic drugs in China reached 103 billion US dollars, accounting for 44.5% of the total pharmaceutical market in China, while generic drugs accounted for 33.0% of the global pharmaceutical market. It is estimated that by 2023, the generic drug market in China will grow to137.7 million USD, with a compound annual growth rate of 6.0% from 20/kloc-0 to 8-2023. In the next five years (20 18 ~2023), under the policy of encouraging the development of innovative patented drugs, the investment in patented drugs is expected to increase, and its market scale is expected to grow to184.4 billion US dollars with a compound annual growth rate of 7.5% in the same period in 2023.
However, at present, the whole world has entered a period of rapid development of R&D. In 20 18 years, the total R&D expenditure of the global pharmaceutical industry was174 billion US dollars. It is estimated that the compound annual growth rate from 2018 to 2023 will be 4.5%, and it will reach 2168 billion USD in 2023. R&D expenditure in 20 18 years accounts for 13.7% of the total revenue of the global pharmaceutical market.
The research and development expenditure of American pharmaceutical companies is the highest in the world. According to the data of 20 18, the total drug R&D expenditure in the United States is $73.6 billion, accounting for more than 40% of the global R&D expenditure, accounting for 15.0% of the total drug sales revenue in the United States, which is higher than the global ratio of 13.7%. With the discovery of various new therapies, the research and development expenditure of innovative drugs will continue to increase. With China's increasing emphasis on innovation policy and the promulgation of corresponding laws and regulations, the progress of domestic R&D is also accelerating. In 20 18, the total expenditure on pharmaceutical R&D in China was17.4 billion US dollars, which is expected to increase to 49.3 billion US dollars in 2023, and the compound annual growth rate from 20 18 to 2023 is 2.3 1%, which is equivalent to the global level.
CRO is a tricky industry. From early drug discovery to commercialization, customized cooperation with CRO can be carried out at all stages, but this is the trend in recent years, and pharmaceutical companies are more inclined to establish long-term cooperative relations with CRO. The domestic CRO scale has increased from $26,543.8+0 billion in 2065,438+04 to $5.5 billion in 2065,438+08, and is expected to increase to $65,438+0,965,438+0 billion in 2023, with a compound annual growth rate of 28.3%. The penetration rate of CRO to domestic R&D expenditure has increased from 26.2% in 20 14 to 32.3% in 20 18, and it is expected to increase to 46.7% in 2023, which is lower than the global penetration rate of 49.3% in the same period. In recent years, the consistency evaluation of 20 16 has played a great role, because the consistency evaluation opinion aims at eliminating generic drugs that have not completed the consistency evaluation of quality and efficacy. The high regulatory standards have led to an increasing demand for high-quality bioequivalence and bioanalysis contract research institutions, because many pharmaceutical companies lack the existing bioequivalence data and the ability to conduct bioequivalence research internally. Then, under the impact of current quantity procurement, pharmaceutical companies still need to control R&D expenditure under high-quality clinical trials, so the market demand for CRO is stronger.
three
In the tide, leading income
In the reshaping period of the rapid development of the industry, the view is still that the leading echelon has greater opportunities. The top three domestic contract research institutions (by revenue) are WuxiAppTec, Pharmaron and Tiger (according to the data of 20 18). CRO company also has different stages of research and development, such as preclinical innovative drugs, mainly WuXi PharmaTech, new drugs from Zhao Yan and Shi Yao Science and Technology. In the clinical stage, if it is an international multi-center clinic, it will mainly be monopolized by foreign capital, including Kuntai, Covens and PPD. In China, the innovative drugs are mainly Tiger Medicine, Northrop, Vangen, Dong Run, etc.
3. 1 Wuxi pharmatech
Everyone is familiar with Wuxi PharmaTech, which is the absolute leader of CRO in China. Based on the revenue of 20 17, Wuxi PharmaTech is the largest drug R&D service platform in Asia, accounting for 1. 1%, ranking first in China, with a market share of 8.3% (recorded revenue 165438+). The parent company of the company is only an investment holding company and does not carry out specific business. Its business is mainly carried out by subsidiaries and Sun Company. Among them, in the CRO field, the preclinical services are mainly undertaken by China's subsidiaries, namely Shanghai Yao Ming, Suzhou Yao Ming, Tianjin Yao Ming and Wuhan Yao Ming, and the clinical services are mainly undertaken by its subsidiaries, namely Shanghai Jiecheng, Shanghai Jinshi and Huiyuan Bio. CMO/CDMO business is mainly undertaken by its subsidiary He Quan Pharmaceutical. From 20 18 to 20 19, the company's revenue in each quarter maintained a year-on-year growth rate of more than 20%. 20 19Q 1 The company achieved revenue of 2.77 billion yuan, up 29% year-on-year, and net profit attributable to the mother was 386 million yuan, up 33% year-on-year, with net profit after deduction of 4.99. At present, the company has 36 domestic holding subsidiaries, 29 overseas holding subsidiaries, 2 branches and 6 shareholding subsidiaries. Among them, pre-clinical R&D business is 65,438+00, clinical R&D business is 4, production process service is 5, and equity investment is 65,438+05. The strategic layout covering the whole industrial chain of new drug R&D is basically completed. In fiscal year 20 18, the company's laboratory service income in China was 51.1300 million yuan, up by 24.09% year-on-year; CDMO/CMO service income was 2.699 billion yuan, up 28.00% year-on-year; The income from laboratory services in the United States was 65.438+20.4 billion yuan, up 6.10% year-on-year; The income from clinical research and other CRO services was 585 million yuan, a year-on-year increase of 64. 17%.
The laboratory services in China District cover all stages of discovery and research and development of small molecular chemicals, and provide integrated related services such as synthetic chemistry, biology, medicinal chemistry, analytical chemistry, pharmacokinetics and toxicology, bioanalysis services and detection services for global customers. At present, the company has one of the largest and most experienced R&D teams of small molecule chemicals in the world, and carries out more than 7,000 chemical reactions every day. The company also continuously improves the technical capabilities of the platform, including the development and application of gene editing, tumor immunity, DNA coding compound library, biocatalysis, fluid chemistry, spray drying, hot melt extrusion, nano-suspension and other technical means. The increase of 20 18 is mainly due to the breakthrough therapy of many new drugs, the qualification of orphan drugs and the "fast track" recognition of FDA.
Through its holding subsidiary, Hequan Pharmaceutical, the company provides research, development and production services (CDMO/CMO services) for customers all over the world. He Quan is the first research and development and production platform for chemical drugs in China that has passed the pre-approval inspection of innovative drugs by FDA. At the same time, it has been approved by the drug regulatory authorities of the United States, China, the European Union, Canada, Switzerland, Australia and New Zealand to provide innovation for these countries and regions.
Commercial production of APIs and GMP intermediates. During this period, the Changzhou factory of the company passed the on-site audit of the US FDA for the first time (483 forms were not received), and the Jinshan factory passed the on-site audit of the US FDA for the second time (483 forms were not received).
Laboratory services in the United States mainly include CDMO services for cell and gene therapy products and medical equipment testing services. The company mainly provides research and development and production services for GMP cell therapy, as well as research and development and production services for genetically engineered cell therapy products and carriers through highly integrated production bases in China and the United States. Cell and gene therapy services include process development, testing and cGMP production of related products. At present, the newly-built15000m2 R&D laboratory and GMP production plant in Philadelphia, USA have been put into use one after another.
Generally speaking, WuXi PharmaTech relies on CRO business to extend the whole drug chain service, including clinical CRO, clinical CRO, CMO and so on. Because of the particularity of CRO company, it can't independently research and develop sales like pharmaceutical companies, so the company has invested in many startups. At present, PE(TTM)A shares are 42 times and Hong Kong shares are 29./kloc-0 times, benefiting from the current wave of innovative drugs, the support of various policies and the development of leading companies.
3.2 Tiger Medicine
Tiger Medicine is the leader of CRO in the clinical stage. In fiscal year 20 18, the company recorded revenue of 2.3 billion yuan, up 36.37% year-on-year, net profit attributable to the mother of 472 million yuan, up 56.86% year-on-year, and net profit attributable to the mother of 357 million yuan, up 48.83% year-on-year. 20 19Q 1 The company achieved revenue of 609 million yuan, up 28.69% year-on-year, net profit attributable to the mother1460,000 yuan, up 5 1.72% year-on-year, and net profit attributable to the mother after deducting non-kloc-0/./kloc-.
The company's business basically covers the whole industrial chain of clinical research. In the preclinical stage, the company can provide services such as biological analysis, CMC, BE testing, PK/PD analysis, etc. In phase I-IV clinical trials, the company can provide services such as clinical trial project management and implementation, medical document writing, clinical monitoring, data management and statistical analysis, central imaging, sample logistics and cold chain transportation of central laboratories, pharmacovigilance and SMO. In addition, the company can also provide services such as product registration, medical translation, GMP certification, training and inspection, as well as integrated clinical services for medical devices from pre-clinical to post-marketing.
According to the data of fiscal year 20 18, the annual income and profit growth rate increased significantly. The income from clinical trial technical services was 1 1 100 million yuan, up by 34.5% year-on-year, of which the income from clinical I-IV clinical and registration was 920 million yuan, up by 43.7% year-on-year, and the income from BE was1.90 million yuan, up by 2% year-on-year, which was affected by the stripping of hand fees. ; The income from clinical research consulting services110.90 billion yuan, up 44.6% year-on-year, of which the number system increased by 28.5% to 320 million yuan, and the SMO increased by 57.2% to 2 1 10,000 yuan. Tiger Pharmaceutical has also made a lot of investments, with nearly 65,438+000 innovative pharmaceutical companies. In 2065,438+08, the investment income reached 65,438+0.1900 million yuan, a year-on-year increase of 65,438+023%. In the first quarter of 2065,438+09, the investment income was 43 million yuan, an increase of 65,438 yuan. In recent years, the company has set up 13 overseas offices through acquisition and self-construction, and increased its overseas business.
four
summary
The valuation of the vanguard troops is not cheap, but in the environment of frequent policies, CRO will be a good hedge industry. Due to the rise of innovative drugs, CRO still has a broad development space. In industry integration, the logic remains unchanged, and the leader is a more certain beneficiary.