Investment Rating - The report maintains an "Outperform" rating for the company [2][15]. Core Views - The company reported a total revenue of RMB 7.47 billion for 2024, a decrease of 6.8% year-on-year, with pharmaceutical sales revenue at RMB 8.62 billion, down 9.0% [11][12]. - The impact of volume-based procurement (VBP) on existing products has largely been digested, with significant sales declines in certain product lines, while innovative products are showing growth [12][14]. - The company has made substantial progress in innovative drug development, with five products already commercialized and additional candidates in various stages of clinical trials [13][14]. Financial Performance Summary - Revenue for 2024 was RMB 7,469 million, down 12% from the previous year, with a projected recovery to RMB 8,326 million in 2025, representing an 11% increase [3][7]. - Net profit for 2024 was RMB 1,620 million, a decline of 32% year-on-year, with an expected increase to RMB 1,671 million in 2025, reflecting a 4% growth [3][7]. - The gross margin decreased to 72.6%, primarily due to price reductions from VBP, while R&D expenditure rose to RMB 890 million, accounting for 11.9% of total revenue [11][12]. Product Line Performance - Cardiovascular and cerebrovascular products generated RMB 4.09 billion in sales, down 18.8%, while dermatology and aesthetic medicine products grew by 18.2% to RMB 670 million [12][14]. - The three VBP products achieved revenue of RMB 2.69 billion, down 28.8% year-on-year, indicating that the short-term impact of centralized procurement has largely played out [12][14]. Innovation and Pipeline - The company has five innovative drugs commercialized, with two additional products submitted for NDA approval, including a potential blockbuster [13][14]. - Over ten clinical-stage innovative programs are progressing, including treatments for various conditions such as stroke and obesity [13][14]. Earnings Forecast and Valuation - Revenue forecasts for 2025 and 2026 have been adjusted to RMB 8.37 billion and RMB 9.44 billion, respectively, reflecting year-on-year growth of 11.5% and 13.3% [14][15]. - The target price is maintained at HKD 9.96 per share, corresponding to a 14x PE for 2025 [15].

股東週年大會通告 股東週年大會通告 CHINA MEDICAL SYSTEM HOLDINGS LIMITED 康哲藥業控股有限公司 * （於開曼群島註冊成立之有限公司） （股份代號：867） 茲通告 China Medical System Holdings Limited(「本公司」，連同其附屬公司稱為「本集團」) 謹訂於二零 二五年四月二十四日（星期四）上午十時於香港特別行政區中區法院道太古廣場港島香格里拉 5 樓天山及廬 山廳舉行股東週年大會（「股東週年大會」），以處理下列事項： 普通決議案 * 僅供識別 1 1. 省覽、考慮及採納截至二零二四年十二月三十一日止年度之本集團經審核之綜合財務報表、本公司董事 （「董事」）會（「董事會」）與核數師之報告； 2. 批准建議的截至二零二四年十二月三十一日止年度之末期股息，每股人民幣 0.1174 元（相當於 0.127 港元）； 3. (a) 重選陳燕玲女士為執行董事； (b) 重選梁創順先生為獨立非執行董事； (c) 重選羅瑩女士為獨立非執行董事；及 (d) 授權董事會釐定董事酬金。 4. 續聘德勤·關黃陳方會計師行為本公司核數師及授權董事會釐定其酬金； 股 ...

此乃要件 請即處理 閣下對本通函任何方面或對應採取之行動如有任何疑問，應諮詢 閣下之註冊證券商、銀行經理、律師、專業 會計師或其他專業顧問。 閣下如已售出或轉讓名下全部 China Medical System Holdings Limited 股份，應立即將本通函及所附隨之 代表委任表格送交買主或承讓人，或經手買賣之銀行、股票經紀或其他代理商，以便轉交買主或承讓人。 香港交易及結算所有限公司及香港聯合交易所有限公司對本通函之內容概不負責，對其準確性或完整性亦不 發表任何聲明，並明確表示概不會就本通函全部或任何部份內容而產生或因倚賴該等內容而引致之任何損失 承擔任何責任。 本通函僅供參考，並不構成收購、購買或認購證券的邀請或要約。 CHINA MEDICAL SYSTEM HOLDINGS LIMITED 康哲藥業控股有限公司* （於開曼群島註冊成立之有限公司） 本公司謹訂於二零二五年四月二十四日星期四上午十時於香港特別行政區中區法院道太古廣場港島香格里拉 5 樓天山及廬山廳舉行股東週年大會（「股東週年大會」），大會通告載於本通函第 21 頁至 25 頁。隨函附 上適用於股東週年大會之代表委任表格。該等代表委 ...

環境、社會及管治報告 康哲藥業控股有限公司(股份代號:867) CHINA MEDICAL SYSTEM HOLDINGS LIMITED (STOCK CODE: 867) 目 舒 cms 康 哲® 2024 | 關於本報告 ��� | l | | --- | --- | | 席致辭 .. | ( | | 關於康哲藥業 | | | ESG 管治策略 . | ଚ | | --- | --- | | 董事會聲明 | 7 | | ESG 戦略 | | | ESG 管治架構及流程 | | | ESG 利益相關方溝通…………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………… 11 | | | ESG 重大性議題 | . 12 | | 滿足醫療健康需求 ………………………………………………………………………………………………………………… 14 | | --- | | 提供更優的疾病治療選擇 | | 提升醫療健康可及性 | | 可信賴的责任公民…………………………………… ...

Financial Performance - Revenue decreased by 6.8% to RMB 7,469.0 million, compared to RMB 8,013.3 million in the previous year; pharmaceutical sales revenue dropped by 9.0% to RMB 8,621.6 million from RMB 9,472.2 million[8]. - Gross profit declined by 11.2% to RMB 5,422.2 million, down from RMB 6,109.2 million; if calculated based on pharmaceutical sales revenue, gross profit decreased by 10.7% to RMB 5,405.4 million from RMB 6,053.7 million[8]. - Annual profit fell by 32.3% to RMB 1,613.1 million, compared to RMB 2,384.4 million in the previous year; normalized annual profit decreased by 36.7% to RMB 1,713.7 million from RMB 2,709.3 million[8]. - Basic earnings per share dropped by 31.9% to RMB 0.6673, down from RMB 0.9792[8]. - The annual profit was RMB 1,613.1 million, down 32.3% from RMB 2,384.4 million in 2023; excluding asset impairment losses, the profit decreased by 36.7% to RMB 1,713.7 million[35]. - The company’s revenue decreased by 6.8% to RMB 7,469.0 million, down from RMB 8,013.3 million in the same period last year[94]. - Pharmaceutical sales revenue fell by 9.0% to RMB 8,621.6 million, compared to RMB 9,472.2 million last year, primarily due to a decline of RMB 1,086.9 million (28.8%) from three drugs affected by national procurement policies[94]. - Gross profit decreased by 11.2% to RMB 5,422.2 million, with a gross margin of 72.6%, down from 76.2% year-on-year[95]. Research and Development - The company launched 1 new drug and received approval for 1 new indication, with 2 new drug applications submitted and 3 new innovative drug collaborations initiated[9]. - The company has over 10 clinical trials progressing smoothly[13]. - The company has completed Phase II clinical trials for the Y-3 injection, a new brain cell protector for stroke treatment, and is progressing steadily towards Phase III clinical trials in China[16]. - The VEGFA+ANG2 bispecific antibody for neovascular age-related macular degeneration (nAMD) has completed Phase I clinical trials in China, with the first subject dosed in Phase II trials[16]. - The high-selectivity TYK2 inhibitor CMS-D001 tablet for psoriasis and atopic dermatitis has received clinical trial approval in China and is advancing through Phase I trials[16]. - The GnRH receptor antagonist CMS-D002 capsule for moderate to severe pain associated with endometriosis has also received clinical trial approval in China and is progressing through Phase I trials[16]. - The GLP-1R/GCGR dual agonist CMS-D005 injection for obesity/overweight is in preparation for Phase I clinical trials after receiving approval in November 2024, with future development planned for metabolic-related diseases[16]. - The company has secured exclusive rights for the selective oral JAK1 inhibitor povorcitinib for various diseases in multiple regions, including mainland China and Southeast Asia, through a collaboration with Incyte[16]. - The company has obtained exclusive commercialization rights for the URAT1 inhibitor ABP-671 for gout and hyperuricemia in mainland China, Hong Kong, and Macau through a partnership with Hangzhou New Element Pharmaceutical Co., Ltd.[16]. - The company has entered into a collaboration with Alpha Cognition Inc. for the exclusive rights to develop and commercialize a modified new drug for mild to moderate Alzheimer's disease symptoms in Asia, Australia, and New Zealand[16]. - The company has expanded its innovative product pipeline to approximately 40 products, covering conditions such as gout, Alzheimer's disease, vitiligo, atopic dermatitis, and asthma[22]. - The company has committed to increasing investment in the research and development of innovative drugs and rare disease medications[29]. - The company is advancing approximately ten clinical trials focused on registration-based randomized controlled trials (RCTs) to ensure continuous innovation[39]. - The company has about twenty self-developed projects progressing steadily, with four innovative drugs entering the clinical development stage in China[39]. Market Expansion and Strategy - The company is focusing on the Southeast Asian market for international expansion, leveraging its successful commercialization experience in China[26]. - The company has established a local operational network in Southeast Asia, centered around its Singapore headquarters, to address regional pharmaceutical needs[26]. - The company is actively enhancing its international supply chain and production capabilities, having invested in a new production facility in Singapore that has received FDA GMP certification[28]. - The company aims to develop into a leading innovative pharmaceutical enterprise in China, focusing on skin health and ophthalmology[26]. - The company is actively pursuing market expansion and strategic collaborations to enhance its product offerings and therapeutic options[57]. - The ongoing clinical trials and collaborations are expected to strengthen the company's position in the biopharmaceutical market and drive future revenue growth[57]. - The company is considering strategic acquisitions to enhance its market position, targeting companies with a combined revenue of $200 million[134]. - The company is focusing on a patient-centered operational philosophy while enhancing its commercialization system for comprehensive coverage[36]. - The company is implementing refined academic promotion strategies and leveraging digital operations to enhance market penetration in key therapeutic areas[62]. Product Development and Commercialization - The company has successfully launched five innovative products in China, covering six indications, with four of them included in the national medical insurance catalog[38]. - The innovative drug Lefran, approved in June 2024, significantly improved the detection rate of non-polyp colorectal lesions during colonoscopy[40]. - Methotrexate injection, approved in March 2023, is the first pre-filled MTX injection for treating psoriasis and rheumatoid arthritis in China, with its RA indication approved in July 2024[42]. - The company’s product Vifor, the first iron-based non-calcium phosphate binder in China, was approved in February 2023 and has shown a 95% success rate in achieving target serum phosphorus levels[44][45]. - The company has launched a unique recombinant human brain natriuretic peptide (rhBNP) for acute decompensated heart failure, which is the only product of its kind approved by the NMPA in China[64]. - The company is actively expanding its presence in the outpatient market, improving coverage and service quality through training programs for retail pharmacies[63]. - The company is developing new products targeting various conditions, including psoriasis, asthma, and non-alcoholic fatty liver disease, with ongoing clinical trials[61]. - The company has established a commercial system focused on unmet clinical needs, enhancing its specialized business and achieving extensive coverage in both hospital and retail channels[62]. - The company has five innovative drugs that have entered the commercialization stage, supported by a dedicated customer value team to analyze market opportunities and update promotion strategies dynamically[62]. Financial Management and Governance - Cash generated from operating activities was RMB 1,268.5 million, a decrease of 49.3% from RMB 2,502.9 million in the previous year, mainly due to reduced operating profit and increased working capital[114]. - Cash used in investing activities increased by 39.1% to RMB 615.1 million, compared to RMB 442.3 million last year, primarily due to increased spending on product rights[115]. - The group had bank borrowings of RMB 831.3 million as of December 31, 2024, down from RMB 1,269.7 million the previous year, with a debt-to-asset ratio of 4.6%, a decrease of 2.6 percentage points from 7.2%[120]. - The group paid dividends of RMB 364.2 million for the 2024 interim and RMB 192.0 million for the 2023 final, compared to RMB 768.5 million and RMB 591.9 million in the previous year[126]. - The company reported a distributable reserve of RMB 2,694.2 million as of December 31, 2024[145]. - The board proposed a final dividend of RMB 0.1174 per share for the year ending December 31, 2024[148]. - The company has adopted a dividend policy without a preset dividend payout ratio, allowing for flexibility based on various financial and operational factors[149]. - The company has confirmed the independence of all independent non-executive directors as per the listing rules[155]. - The company has established a robust quality management system to comply with GMP and GSP standards, ensuring ongoing regulatory supervision[195]. - The company has not obtained product liability insurance in China, which may expose it to significant costs and damage to customer relationships in case of claims[196]. - The company maintains good relationships with employees, customers, and suppliers, focusing on fair compensation and effective communication[189][190]. Challenges and Risks - The company faced challenges with three original drugs in national procurement, which negatively impacted its performance during the reporting period[35]. - The Chinese healthcare system is undergoing significant reforms, with frequent changes in laws and regulations affecting the healthcare, medical, and pharmaceutical industries, posing risks to the company's operations if strategies are not optimized accordingly[197]. - The company must participate in government-led bidding processes annually or every few years, with failure to win bids potentially impacting product sales in specific provinces[198]. - The successful development, regulatory approval, and commercialization of innovative patented products are influenced by various factors, including resource availability and the uncertainty of approval processes, which could adversely affect the company's future growth if unsuccessful[199]. - There are potential unknown risks and uncertainties that may not be significant now but could become major in the future, impacting the company's operations[200].

Investment Rating - The report maintains a "Buy" rating for the company, indicating an expected relative price increase of over 20% against the market benchmark within the next six months [6][17]. Core Viewpoints - The company's 2024 revenue was reported at 7.47 billion RMB, a decrease of 6.8%, with drug sales revenue at 8.62 billion RMB, down 9%. The annual profit was 1.61 billion RMB, reflecting a decline of 32.3%, but the performance met expectations [1]. - The company has seen its non-national procurement exclusive varieties and innovative products account for over 50% of its revenue, indicating a positive shift towards innovation [2]. - The impact of centralized procurement on three key products resulted in a revenue of 2.69 billion RMB, down 28.8% year-on-year. However, revenue from non-national procurement exclusive and innovative products reached 4.55 billion RMB, up 4.1%, making up 52.8% of total revenue, suggesting that the short-term impact of centralized procurement has largely cleared [3]. - The company is entering a harvest phase for its innovative business, with a significant product, Luracitinib, expected to be launched by 2025. In 2024, one innovative product was successfully launched, and another received approval for a new indication, indicating progress in its pipeline [4]. Financial Data and Forecast - The company’s financial projections for 2025-2027 estimate net profits of 1.63 billion RMB, 2.04 billion RMB, and 2.46 billion RMB, representing growth rates of 1%, 25%, and 21% respectively. This reflects an adjustment from previous forecasts [4]. - The main revenue figures are as follows: 2023A at 8.01 billion RMB, 2024A at 7.47 billion RMB, with expected growth rates of -12%, -7%, and positive growth in subsequent years [5]. - The earnings per share (EPS) is projected to be 0.67 RMB in 2025, with a price-to-earnings (P/E) ratio of 10.2, indicating a stable valuation outlook [5].

Investment Rating - The report does not specify a clear investment rating for 康哲药业 (0867.HK) [1] Core Views - 康哲药业's 2024 annual report shows that the company's revenue was 74.7 billion HKD, a decrease of 6.8% year-on-year, with pharmaceutical sales revenue at 86.2 billion HKD, down 9% [7] - The annual profit was 16.1 billion HKD, down 32.3%, but the performance met expectations [7] - Over 50% of the revenue came from exclusive products and innovative products, with significant growth in the dermatology/aesthetic and ophthalmology lines [7] - The company has made breakthroughs in innovative research and development, marking the beginning of a new era for innovative products [7] - 康哲药业 aims to establish a foothold in the Southeast Asian market through its new entity 康联达健康 and has acquired a manufacturing facility in Singapore [7] Financial Summary - Revenue projections for 康哲药业 from 2025 to 2027 are estimated at 83.1 billion HKD, 105.2 billion HKD, and 121.6 billion HKD respectively, with growth rates of 10.9%, 25.8%, and 15.1% [9][10] - The net profit attributable to the parent company is projected to be 1.63 billion HKD in 2025, 2.24 billion HKD in 2026, and 2.72 billion HKD in 2027, with growth rates of 0.85%, 37.43%, and 20.98% respectively [2][10] - The earnings per share (EPS) is expected to increase from 0.67 HKD in 2025 to 1.11 HKD in 2027 [2][10] - The company's price-to-earnings (P/E) ratio is projected to decrease from 12.60 in 2025 to 7.58 in 2027, indicating potential undervaluation [2][10] Business Segments - The cardiovascular segment is expected to see a revenue decline to 27.7 billion HKD in 2025, while the digestive and autoimmune segment is projected to grow to 33.1 billion HKD [10] - The ophthalmology segment is anticipated to grow significantly, reaching 8.8 billion HKD in 2025, while the dermatology and aesthetic segment is expected to grow to 9.8 billion HKD [10] - Other products are projected to maintain stable revenue around 3.8 billion HKD [10]

Investment Rating - The report maintains a "Buy" rating for 康哲药业 (0867.HK) [11] Core Views - 康哲药业's revenue for 2024 is projected at 74.69 billion HKD, a year-on-year decrease of 6.79%, while the net profit attributable to shareholders is expected to be 16.13 billion HKD, down 32.54% year-on-year [5] - The company is focusing on innovation and increasing sales promotion for new products, with R&D expenses rising by 69.1% to 330 million HKD, reflecting a commitment to enhancing its product pipeline [6] - Traditional business lines are stabilizing, with the ophthalmology and dermatology segments showing growth, indicating a shift towards new business opportunities [7] - The company is advancing its innovative drug pipeline, with multiple projects in clinical stages, including submissions for NDA applications in China [8] - 康哲药业 is expanding its overseas operations, particularly in Southeast Asia, aiming to establish a strong market presence [10] Financial Summary - For 2024, 康哲药业's revenue is expected to decline by 7%, followed by growth of 11% in 2025, 14% in 2026, and 17% in 2027 [13] - The net profit is projected to stabilize in 2025, with a slight increase in subsequent years, reflecting a recovery in profitability [13] - The gross margin is expected to remain relatively stable, with slight improvements anticipated in the coming years [13] - Key financial ratios indicate a healthy balance sheet, with a projected P/E ratio decreasing from 11.31 in 2024 to 9.15 by 2027, suggesting potential undervaluation [13]

Investment Rating - The report maintains a "Buy" rating for 康哲药业 (0867.HK) [11] Core Viewpoints - 康哲药业's revenue for 2024 is projected at 74.69 billion HKD, a year-on-year decrease of 6.79%, with a net profit of 16.13 billion HKD, down 32.54% year-on-year [5] - The company is increasing its investment in innovative research and development, with R&D expenses rising by 69.1% to 330 million HKD, reflecting a focus on new product launches and sales promotion [6] - Traditional business lines are stabilizing, with the ophthalmology and dermatology segments showing growth, while the cardiovascular and digestive disease lines have seen declines [7] - The company has a robust pipeline of innovative drugs, with over 10 projects in clinical progress in China, including submissions for NDA applications [8] - 康哲药业 is expanding its overseas operations in Southeast Asia, aiming to become a key player in the region's pharmaceutical market [10] Financial Summary - Revenue projections for 2025-2027 are 83.20 billion HKD, 94.54 billion HKD, and 110.43 billion HKD, with expected growth rates of 11%, 14%, and 17% respectively [11] - Net profit forecasts for the same period are 16.28 billion HKD, 18.95 billion HKD, and 22.55 billion HKD, with growth rates of 0%, 16%, and 19% respectively [11] - The gross margin is expected to stabilize around 73% to 74.5% over the next few years, indicating a recovery in profitability [13]

Key Points Summary of 康哲药业 Conference Call Company Overview - **Company**: 康哲药业 (Kangzhe Pharmaceutical) - **Year**: 2024 Industry and Market Context - **Impact of 集采政策 (Centralized Procurement Policy)**: - Major products like 不一定 and 优思弗 faced price reductions of 20% in the first half and 10% in the second half of 2024, leading to a 50% revenue drop for three centralized procurement drugs compared to their peak in 2022 [4][20] - Despite these challenges, the company expects to stabilize and recover to 50% profit levels by 2025 [20] Financial Performance - **Revenue Growth**: - Overall revenue increased by approximately 10% year-on-year in 2024, but operational profit decreased by around 1 billion due to centralized procurement impacts and increased promotional expenses for new products [3][6] - **R&D and Profit Margins**: - R&D expenditure was 888.8 million, accounting for 20% of revenue, with a decline in both EBITDA and net profit margins [6][36] - The company maintains a cash reserve of approximately 3.7 billion and a dividend payout ratio of 40% [6][31] Product Development and Innovation - **Current and Future Products**: - The company has seven exclusive products, with plans to launch 11 innovative products over the next three years, which currently account for 52.8% of total revenue [3][5][10] - Notable upcoming products include 芦可替尼乳膏 (Lukotini Cream) and 德西杜司他片 (Desidustat Tablets), targeting conditions like vitiligo and chronic kidney anemia [10][12] Strategic Initiatives - **Market Expansion**: - 康哲药业 is actively expanding into Southeast Asia through 康联达健康体系 (Kanglian Health System) and 法玛津工厂 (Pharmazine Factory), with expectations of significant revenue contributions starting in 2025 [16][17] - **Commercialization Efforts**: - The academic promotion team has grown to approximately 4,700 members, covering 300,000 retail terminals, enhancing the company's market presence [11] Challenges and Future Outlook - **Profitability Concerns**: - The company anticipates that while revenue will grow at double digits in 2025, profit margins may not keep pace due to ongoing R&D investments [36][44] - **Long-term Goals**: - 康哲药业 aims to achieve sales peaks by 2026 and profit highs by 2027, with a focus on maintaining a stable dividend policy despite the need for significant reinvestment [19][31][44] Additional Insights - **Supply Chain Management**: - The company is investing in supply chain stability, including transferring production to lower-cost regions to mitigate cost pressures from centralized procurement [26][42] - **Focus on Specialty Areas**: - 康哲药业 is concentrating on niche markets such as dermatology and cardiovascular treatments, with plans to develop innovative solutions in these areas [41][43] This summary encapsulates the key points discussed in the conference call, highlighting 康哲药业's current performance, strategic initiatives, and future outlook in the pharmaceutical industry.