9.2 billion new crown special medicine orders smashed the CDMO leader, this year’s revenue will surge by 200%?

On the afternoon of February 20, Asymchem issued an announcement that the company continued to provide contract custom development and production (CDMO) services for a small molecule chemical innovative drug of a pharmaceutical company. Recently, Jilin Asymchem, a wholly-owned subsidiary of the company, has Co., Ltd. and customers signed a new batch of “Supply Contracts” for related products. The contract value is equivalent to about 3.542 billion yuan . The new supply contract has come into effect after being signed and sealed by both parties.

Pfizer: “You can get my ID card directly. ”

The announcement shows that the contract supply time is 2022, which means that this revenue will be reflected in the 2022 performance.

Before receiving the above contract, Asymchem has won two consecutive large orders:

On November 17, 2021, a US$480 million small molecule drug supply contract was signed, and the contract supply time is from 2021 to 2022;

On November 28, 2021, a new supply contract was signed, with a contract value equivalent to about 2.72 billion yuan, and the delivery time is 2022;

Since there is only one and a half months left in 2021 when the first contract is signed, the revenue of these three contracts will basically be realized in 2022, with a total order value of about 9.298 billion yuan.

In 2020, Asymchem’s annual revenue reached 3.15 billion yuan. The order amount of these three small molecule CDMO business orders is three times that of last year’s revenue, which will contribute greatly to the performance in 2022.

Pfizer’s CEO said it expects to produce 120 million courses of Paxlovid by the end of 2022, with total sales expected to reach $63.48 billion. Assuming that Pfizer maintains a 50% gross profit margin, the operating cost corresponds to an intermediate and API market of $31.8 billion per year.

Seeing this figure, the investor calculators of relevant domestic CDMO companies and API intermediate companies are estimated to be smoking.

Although a considerable number of investors believe that most of these orders are temporary income, considering the sales history of the influenza antiviral drug oseltamivir and the strong variability and infectivity of the new coronavirus, the continuity of orders may be very long. long.

Oseltamivir, an oral anti-influenza virus drug, was clinically developed by Gilead and was launched in 1996 for the treatment of uncomplicated influenza A and B virus infections. In 2009, Mexico and the United States successively broke out H1N1 influenza. As the most effective drug at the time, oseltamivir was undoubtedly pushed to the first battlefield against influenza. In 2009, the global sales of oseltamivir peaked at US$2.949 billion.

The globalization of the new coronavirus has become a consensus. The current most infectious Omicron will evolve a stronger mutant strain in the future, or there will be a “new crown H1N1 incident”, which is not ruled out.

It is hoped that Asymchem will be able to use the dividends of this wave of orders to open the door to the company’s impact on the world’s first echelon of CDMOs.

In addition, why has Asymchem be able to steadily become the king of Pfizer’s small molecule drug CDMO orders in China?

First, based on the long-term cooperative relationship, Asymchem’s income from Pfizer from 2018 to 2020 was 184 million, 248 million, and 637 million, respectively, accounting for 10.07%, 10.11%, and 20.25% of the year’s operating income.

The second is the strong scale advantage and fundraising ability to help the company’s production capacity expansion.

According to Asymchem’s 2021 interim report, the company’s existing reactors are about 3,000 m³ , and the production capacity was already tight at that time. In order to meet the growing demand for small molecule CDMO orders, the company has released 1,390 m³ in Tianjin and Dunhua in the second half of 2021. It will add 1,500 m³ of production capacity in Dunhua and Zhenjiang in 2022. It is expected that the company’s production capacity will reach 5,890 m³ in 2022, doubling the production capacity at the end of 2020.

Judging from the description of the 2020 annual report, Asymchem said that the company’s capacity utilization rate in 2020 still has room for improvement. If calculated based on 80% capacity utilization rate, the output of 2800m³ corresponds to 4 billion income, then it will double in 2022. The production capacity corresponds to 8 billion. It is a challenge to continue to optimize the process route and receive more orders.

Another quick method may be to achieve a rapid increase in its own production capacity through the acquisition of relatively mature production capacity and appropriate transformation.

The company also accelerated its pace of financing and acquisitions, and continued to consolidate and enhance its global leading position.

On September 22 , 2021, Asymchem’s H-share listing application was approved by the China Securities Regulatory Commission. The company plans to issue no more than 49,238,800 overseas listed foreign shares ( H shares), and the funds raised will be used for small molecules. CDMO capacity building , emerging business capacity building.

On February 12, Asymchem announced that it would acquire Snapdragon, a leader in the field of continuous reaction technology, for US$57.94 million, which is dedicated to the research, development and industry of continuous reaction technology, a disruptive technology in the production of APIs. Application, to provide route development, design and process optimization services for the continuous reaction production of innovative drug APIs for large pharmaceutical companies in Europe and the United States and small and medium-sized innovative drug companies.

According to the company’s latest performance report, the estimated revenue in 2021 is 4.505-4.662 billion yuan, a year-on-year increase of 43-48% (the company is expected to have a reactor capacity of 4400m³ by the end of 2021, of which 1390³ capacity will be released in the second half of the year, and the revenue in the second half of the year will be released. About 2.9 billion ) , with the accelerated release of production capacity in the future, the company is expected to exceed 3 billion in net profit in 2023.

The current market value of the company is 81.2 billion yuan. From a long-term perspective, it still has a good investment value in the future.

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