Investment Rating - The report maintains a "Buy" rating for the company [2][3] Core Insights - The company achieved a revenue of 7.82 billion RMB in 2023, representing a year-on-year growth of 13.8%. The adjusted net profit was 1.95 billion RMB, up 17.7% from the previous year [1][2] - The core product, Tevizo, continues to show strong growth, holding a 65% market share in the platelet reduction treatment market in mainland China. Tevizo's sales revenue reached 4.205 billion RMB in 2023, a 23.8% increase year-on-year [1][2] - The company is a leader in the hair health sector with its Minoxidil product, which captured 72.6% of the market share in 2023, generating revenue of 1.12 billion RMB, a 25.8% increase from the previous year [1][2] - The company has a robust pipeline with 13 products in hematology/oncology and 11 in autoimmune diseases, indicating a diverse therapeutic focus [1][2] Financial Summary - Revenue projections for 2024, 2025, and 2026 are 8.801 billion RMB, 9.925 billion RMB, and 11.116 billion RMB, respectively, with growth rates of 12.6%, 12.8%, and 12.0% [2][4] - Net profit estimates for the same years are 1.891 billion RMB, 2.280 billion RMB, and 2.746 billion RMB, with corresponding growth rates of 22.1%, 20.6%, and 20.4% [2][4] - The company’s P/E ratios are projected to be 7, 5, and 4 for 2024, 2025, and 2026, respectively, indicating a favorable valuation trend [2][4]

Financial Performance - Revenue increased by RMB 950.2 million or 13.8% to RMB 7,815.9 million[2] - Gross profit rose by RMB 970.0 million or 17.1% to RMB 6,641.6 million, with a gross margin of 85.0%[2] - Net profit attributable to equity holders decreased by RMB 366.5 million or 19.1% to RMB 1,549.2 million, while adjusted operating profit increased by RMB 293.3 million or 17.7% to RMB 1,952.4 million[2] - EBITDA decreased by RMB 226.0 million or 8.6% to RMB 2,389.1 million, while adjusted operating EBITDA increased by RMB 464.6 million or 20.2% to RMB 2,768.4 million[2] - Total revenue for 2023 reached RMB 7,815,938 thousand, a 13.8% increase from RMB 6,865,735 thousand in 2022[18] - The company reported a net profit of RMB 1,586.3 million for the year, down from RMB 1,908.9 million in the previous year[5] - Basic earnings per share decreased to RMB 0.64 from RMB 0.78 year-on-year[4] - The group reported a net loss from the fair value changes of financial assets amounting to RMB 358,548 thousand in 2023, with no such loss reported in 2022[28] Assets and Liabilities - Total non-current assets increased to RMB 14,432.3 million from RMB 12,258.4 million year-on-year[7] - Current assets increased to RMB 9,750.5 million from RMB 7,906.6 million year-on-year[7] - Total liabilities increased to RMB 3,727.6 million from RMB 1,843.9 million year-on-year[7] - Non-current liabilities decreased from RMB 4,801,470 thousand in 2022 to RMB 3,383,818 thousand in 2023, a reduction of approximately 29.5%[8] - The net asset value increased from RMB 15,363,581 thousand in 2022 to RMB 16,513,600 thousand in 2023, representing a growth of about 7.5%[9] - Total equity attributable to owners of the parent rose from RMB 12,925,805 thousand in 2022 to RMB 14,033,771 thousand in 2023, an increase of approximately 8.6%[9] Market and Product Development - The company is focused on expanding its biopharmaceutical product development and marketing efforts in mainland China, aiming to enhance market presence[10] - The company has a strategic focus on research and development of new products and technologies to drive future growth and market expansion[10] - The company is committed to maintaining a strong financial position while exploring potential mergers and acquisitions to enhance its portfolio[10] - The company holds a 65.0% market share in the platelet reduction treatment market in mainland China as of 2023, according to IQVIA[52] - The company has a 42.2% market share in the rhEPO market in mainland China as of 2023[52] - The company’s product Mandi holds a dominant market share of 72.6% in the milo-dex market in mainland China as of 2023[52] - The company’s TNFα inhibitor product Yisai Pu has a market share of 22.7% in the TNFα market in mainland China as of 2023[52] Research and Development - The company is actively developing 29 pipeline products, with 25 of them being innovative drugs in mainland China, including 15 antibodies and 7 small molecule drugs[80] - The research and development team consists of over 600 experienced scientists focused on accelerating clinical development and seeking breakthrough therapies to meet unmet medical needs[79] - The company emphasizes the importance of its comprehensive R&D platform, which includes antibody discovery, molecular cloning, and clinical trial management[77] Financial Management and Governance - The financial statements are prepared in accordance with International Financial Reporting Standards, ensuring compliance and transparency in financial reporting[11] - The company maintains control over its subsidiaries, which are consolidated into the financial statements from the date control is obtained until it ceases[12] - The company has adopted the corporate governance code as per the Hong Kong Stock Exchange listing rules to enhance shareholder rights and corporate value[122] - The roles of the Chairman and CEO are not separated, with the same individual holding both positions to ensure consistent leadership direction[123] Shareholder Information - The board proposed a final dividend of HKD 0.25 per share for the year ended December 31, 2023, compared to HKD 0.10 in 2022[2] - The proposed final dividend for the year ended December 31, 2022, is HKD 0.10 per share, subject to shareholder approval[34] - The company will suspend the registration of shareholders from June 20, 2024, to June 25, 2024, for the annual general meeting[120] - The company will also suspend the registration of shareholders from July 24, 2024, to July 26, 2024, for the final dividend entitlement[121] Compliance and Audit - Ernst & Young confirmed that the financial data in the preliminary performance announcement aligns with the consolidated financial statements for the reporting period[128] - The audit committee, consisting of three independent non-executive directors, has reviewed and approved the accounting principles and annual performance for the reporting period[127]

三生制药（1530.HK）深度研究 基本面稳健，生发产品蔓迪及后续管线持续发力 2024年03月08日 ➢ 主营业务稳健，特色产品持续发力。2023H1 实现营业收入 37.8 亿元，同 推荐 首次评级 比增长22.3%；2023H1实现归母净利润9.8亿元，同比增长1.4%。2023H1生 当前价格： 4.94港元 物制品板块收入同比增长 20%；毛发健康板块收入同比增长 36%，618 及双十 一大促电商销售再摘榜首；CDMO收入同比增长72%。 [Table_Author] ➢ 核心产品特比澳以销售额计，继续居于升血小板市场首位。特比澳是 2005 年上市的全球唯一商业化重组血小板生成素。2023 年上半年销售额同比增长 28.2%，主要系于2023年特比澳的医保谈判价格没有下降，此外特比澳产品在 2023 年争取到的政策环境有利产品放量，过去纳入《中国肿瘤化疗相关性血小 板减少症专家诊疗共识》，现在已纳入《中国肿瘤药物相关血小板减少诊疗专家 共识》的推荐用药，覆盖治疗人群得到进一步扩大。按比例计算，今年特比澳产 分析师 王班 品贡献接近40亿元报表收入，特比澳产品营收占总集团营收一半。 执业证书： S ...

Market Share and Product Performance - The company holds a 64.6% market share in the treatment of thrombocytopenia in mainland China for its product Tevazo, according to IQVIA data for the first half of 2023[5]. - The company has a 42.9% market share in the rhEPO market in mainland China, maintaining its leadership for the past 20 years[5]. - The company’s product Mandi has a dominant market share of 70.3% in the minoxidil solution market in mainland China as of the first half of 2023[5]. - The company’s TNFα inhibitor product Yisai has captured 23.7% of the TNFα market in mainland China during the same period[5]. - Tebentafusp holds a 33.1% market share by volume and 64.6% by sales in the treatment of thrombocytopenia in mainland China as of the first half of 2023[13]. - Yibiao has maintained a dominant position in the rhEPO market in mainland China since 2002, with a significant market share alongside Cybor[14]. - Yisaipu's market share in the TNFα inhibitor market in mainland China was 23.7% in the first half of 2023, reflecting a decline due to increased competition and price adjustments[15]. - Mandi holds a 70.3% market share in mainland China with a sales growth of 35.3% year-on-year in the first half of 2023[18]. Financial Performance - Revenue increased by RMB 689.3 million or 22.3% to RMB 3,783.8 million for the six months ended June 30, 2022[10]. - Gross profit rose by RMB 636.4 million or 24.8% to RMB 3,201.6 million, with gross margin increasing from 82.9% to 84.6%[10]. - Net profit attributable to equity holders increased by RMB 13.7 million or 1.4% to RMB 980.6 million, while normalized net profit rose by RMB 199.3 million or 20.1% to RMB 1,191.5 million[10]. - EBITDA grew by RMB 37.5 million or 2.9% to RMB 1,330.5 million, with normalized EBITDA increasing by RMB 228.4 million or 17.7% to RMB 1,518.1 million[10]. - The company's revenue for the reporting period was approximately RMB 3,783.8 million, an increase of about RMB 689.3 million or 22.3% compared to RMB 3,094.5 million for the same period last year[36]. - The gross profit increased to approximately RMB 3,201.6 million, up by about RMB 636.4 million or 24.8%, with a gross margin rising from approximately 82.9% to 84.6%[40]. - The company reported a total comprehensive income of RMB 933,638 thousand for the first half of 2023, compared to RMB 892,185 thousand in 2022[92]. Research and Development - As of June 30, 2023, the company is actively developing 30 pipeline products, with 25 being innovative drugs in mainland China[6]. - The company is focusing on expanding its CDMO business to increase revenue scale, which has been operational since December 2021[5]. - The company is advancing multiple innovative biopharmaceuticals and small molecule drugs, including SSS06 (NuPIAO) for anemia and 608 for autoimmune diseases[26]. - The R&D team consists of nearly 600 experienced scientists focused on accelerating clinical development and seeking breakthrough therapies[26]. - The company is actively promoting the long-term efficacy and safety of Yisaipu through post-marketing clinical studies[15]. Clinical Trials and Approvals - The first patient has been enrolled in the Phase III clinical study of Tebentafusp for chronic liver disease-related thrombocytopenia[12]. - The NDA for Remitch® has been approved for treating pruritus in hemodialysis patients, marking it as the first selective opioid κ receptor agonist approved for this indication in China[12]. - Yibiao has been approved for three indications: anemia due to chronic kidney disease (CKD), chemotherapy-induced anemia (CIA), and perioperative red blood cell mobilization[14]. - The pre-filled Yisaipu injection has been approved by the National Medical Products Administration in March 2023, expected to enhance patient convenience and drive further growth[15]. - The company has initiated a Phase III clinical trial for anti-IL-17A monoclonal antibody (608) for plaque psoriasis, with primary endpoint data expected in the second half of 2023[30]. Distribution and Market Presence - The company has established a national distribution network selling products to approximately 8,700 hospitals and medical institutions across mainland China[6]. - The sales and marketing network consists of approximately 2,704 sales and marketing personnel, 1,144 distributors, and 1,889 third-party promoters[33]. - The company’s products are sold in nearly 2,700 tertiary hospitals and over 6,000 secondary or lower-level hospitals across all provinces in mainland China[33]. Employee and Operational Metrics - The company employs 5,311 staff across its operational facilities in Shenyang, Shanghai, Hangzhou, Shenzhen, and Como, Italy[6]. - The group employed a total of 5,311 employees as of June 30, 2023, compared to 5,213 employees as of December 31, 2022, with employee costs amounting to approximately RMB 604.4 million during the reporting period[59]. Debt and Financing - As of June 30, 2023, the total interest-bearing bank borrowings of the group amounted to approximately RMB 3,725.7 million, an increase from RMB 2,315.0 million as of December 31, 2022, reflecting new bank borrowings of approximately RMB 1,640.9 million during the reporting period[54]. - The group’s leverage ratio increased from approximately 29.2% as of December 31, 2022, to approximately 30.9% as of June 30, 2023[54]. - The financing costs increased to approximately RMB 88.9 million, an increase of about RMB 52.4 million or approximately 143.6% compared to RMB 36.5 million for the six months ended June 30, 2022[47]. Shareholder Information and Stock Options - The company has authorized the issuance of up to 242,439,857 shares under the stock option plan, representing approximately 9.94% of the issued shares as of the report date[67]. - The stock option plan is designed to provide selected participants with an opportunity to acquire ownership interests in the company, encouraging efforts to enhance the company's value[67]. - The stock options granted to employees (excluding directors) as of June 30, 2023, included 15,656,000 options, with 50,000 options exercised during the period[70]. - The company adopted the 2019 Share Award Scheme on July 16, 2019, allowing a maximum of 10% of the total issued shares at the adoption date for awards, which amounted to 253,500,255 shares[72]. Regulatory and Compliance - The independent review report concluded that no matters were found that would lead to a belief that the interim financial information was not prepared in accordance with International Accounting Standard 34[88]. - The company has applied new and revised International Financial Reporting Standards from January 1, 2023, with no impact on the interim consolidated financial information[106].

Financial Performance - Revenue increased by RMB 689.3 million or 22.3% to RMB 3,783.8 million compared to the six months ended June 30, 2022[2]. - Gross profit rose by RMB 636.4 million or 24.8% to RMB 3,201.6 million, with a gross margin increase from 82.9% to 84.6%[2]. - Net profit attributable to equity holders of the parent increased by RMB 13.7 million or 1.4% to RMB 980.6 million, while normalized net profit rose by RMB 199.3 million or 20.1% to RMB 1,191.5 million[2]. - EBITDA increased by RMB 37.5 million or 2.9% to RMB 1,330.5 million, with normalized EBITDA up by RMB 228.4 million or 17.7% to RMB 1,518.1 million[2]. - The company reported a total comprehensive income of RMB 933.6 million for the period, compared to RMB 892.2 million for the same period last year[9]. - The company’s basic earnings per share increased to RMB 0.40 from RMB 0.39 year-on-year[5]. - The profit attributable to equity holders of the parent company for the six months ended June 30, 2023, was RMB 980,577,000, compared to RMB 966,893,000 for the same period in 2022, representing an increase of approximately 1.1%[31]. - Basic earnings per share for the first half of 2023 were RMB 0.402, compared to RMB 0.394 in the same period of 2022[30]. Assets and Liabilities - Total non-current assets amounted to RMB 12,918.6 million as of June 30, 2023, compared to RMB 12,258.4 million as of December 31, 2022[10]. - Current assets totaled RMB 10,251.3 million as of June 30, 2023, an increase from RMB 9,750.5 million as of December 31, 2022[10]. - Current liabilities increased to RMB 3,559.6 million as of June 30, 2023, compared to RMB 1,843.9 million as of December 31, 2022[10]. - The net asset value was RMB 15,964.4 million as of June 30, 2023, up from RMB 15,363.6 million as of December 31, 2022[11]. - The total equity attributable to owners of the parent company increased to RMB 13,520,757 thousand as of June 30, 2023, compared to RMB 12,925,805 thousand in the previous year, reflecting a growth of approximately 4.6%[12]. - The total borrowings as of June 30, 2023, were RMB 4,937,483,000, compared to RMB 4,478,742,000 as of December 31, 2022, reflecting an increase of about 10.2%[43]. - The total interest-bearing bank borrowings increased to approximately RMB 3,725.7 million from RMB 2,315.0 million as of December 31, 2022, reflecting an increase of approximately RMB 1,640.9 million during the reporting period[96]. Revenue Sources - Revenue for the six months ended June 30, 2023, reached RMB 3,783,833 thousand, a 22.3% increase from RMB 3,094,460 thousand in the same period of 2022[20]. - Revenue from the sale of biopharmaceutical products and contract development and manufacturing services was RMB 3,688,923 thousand for the first half of 2023, up from RMB 3,039,146 thousand in the prior year, representing a growth of 21.5%[20]. - The company reported external customer revenue from mainland China of RMB 3,684,591 thousand for the first half of 2023, compared to RMB 3,019,862 thousand in the same period of 2022, marking an increase of 22%[18]. - Total customer contract revenue for 2023 reached RMB 3,783,833 thousand, a 22.2% increase from RMB 3,094,460 thousand in 2022[21]. - The CDMO business generated approximately RMB 95 million in customer orders in the first half of 2023, showcasing strong demand for biopharmaceutical services[67]. - The revenue from CDMO business rose to approximately RMB 94.9 million, an increase of about RMB 39.6 million or 71.6% compared to RMB 55.3 million in the previous year[82]. Market Position and Products - The company reported a market share of 64.6% for its core product, Teplizumab, in the platelet reduction treatment market in China for the first half of 2023[51]. - The company has a 42.9% market share in the rhEPO market, maintaining its position as a leader for the past 20 years[51]. - Tebipenem, a proprietary product developed by the company, has a market share of 33.1% in terms of volume and 64.6% in terms of sales for the treatment of thrombocytopenia in mainland China as of the first half of 2023[56]. - The market share of Erythropoietin in the rhEPO market is primarily held by the company and its competitor, accounting for a significant portion of the 10,000 IU dosage market[57]. - The market share of Etanercept in the TNFα inhibitor market in mainland China was 23.7% in the first half of 2023[59]. - The sales of the innovative anti-HER2 monoclonal antibody, Eniotuzumab (Saiputing), expanded to over 1,300 hospitals in mainland China in the first half of 2023, with an increasing average treatment duration per patient[60]. - Mandi (Minoxidil) captured a market share of 70.3% in mainland China in the first half of 2023, with a year-on-year sales growth of 35.3%[62]. Research and Development - The company has 30 products in active development, with 25 of them being innovative drugs in mainland China, including 14 antibody products and 10 small molecule drugs[72]. - The research and development team consists of nearly 600 experienced scientists focused on accelerating clinical development and seeking breakthrough therapies[71]. - The company is conducting clinical trials for various innovative biological products and small molecule drugs targeting diseases such as renal disease, tumors, autoimmune diseases, and skin conditions[70]. - The company is actively preparing for bioequivalence studies for several small molecule generic products in the fields of nephrology, autoimmune diseases, and dermatology[70]. - The company has initiated a Phase III clinical study for Teplizumab to treat chronic liver disease-related thrombocytopenia, with the first patient enrolled recently[53]. - The company is actively pursuing clinical development for TRK-820 in chronic liver disease to meet the clinical needs of patients in China[66]. Expenses and Financial Management - Sales and distribution expenses amounted to approximately RMB 1,374.8 million, an increase of about RMB 224.5 million or 19.5% compared to RMB 1,150.3 million for the six months ended June 30, 2022[86]. - Administrative expenses were approximately RMB 214.4 million, up by about RMB 16.3 million or 8.2% from RMB 198.1 million for the six months ended June 30, 2022[87]. - R&D costs increased to approximately RMB 306.6 million, a rise of about RMB 12.3 million or 4.2% compared to RMB 294.3 million for the six months ended June 30, 2022[88]. - Financing costs rose to approximately RMB 88.9 million, an increase of about RMB 52.4 million or 143.6% compared to RMB 36.5 million for the six months ended June 30, 2022[90]. - Income tax expenses increased to approximately RMB 207.6 million, up by about RMB 43.6 million or 26.6% from RMB 164.0 million for the six months ended June 30, 2022[91]. Strategic Initiatives - The company is focusing on increasing brand awareness and market penetration, currently at only 2-3% among the 250 million people suffering from hair loss in mainland China[62]. - The company aims to enhance its digital marketing strategy by expanding its online presence to new platforms like Douyin and Xiaohongshu, targeting potential customers more effectively[62]. - The company plans to focus on accelerating the development of autoimmune products and exploring multiple indications in the second half of 2023[80]. - The company is preparing for clinical trial applications for Winlevi® in mainland China, aiming to provide new treatment options for millions of acne patients[68]. - The company is committed to continuous market education and resource investment to promote scientific hair restoration and enhance brand recognition[62]. Corporate Governance - The audit committee reviewed the group's unaudited interim results and found the internal control and risk management systems to be effective and sufficient[108]. - The board of directors includes executive directors Dr. Liu Jing and Ms. Su Dongmei, as well as non-executive director Mr. Huang Bin, and independent non-executive directors Mr. Pu Tianruo, Ms. Yang Kaidi, Mr. Huang Zuyao, and Dr. Zhang Dan[110].

Market Position and Share - The company holds a 64.8% market share in the platelet reduction treatment market in mainland China for its product Teplizumab, according to IQVIA data[5]. - The company has maintained a leading position in the rhEPO market in mainland China with a market share of 44.5%[5]. - The company’s product Mandi has a dominant market share of 71.7% in the minoxidil tincture market in mainland China[5]. - Tebipenem's market share for treating thrombocytopenia in mainland China is 26.2% by volume and 64.8% by sales revenue[27]. - Yisaipu's market share in the TNFα inhibitor market in mainland China was 27.1% in 2022[30]. - Yibiao has maintained a dominant position in the rhEPO market in mainland China since 2002, with a significant market share in the 10,000 IU dosage[28]. - Mandi holds a 71.7% market share in mainland China with a sales growth of 48.1% year-on-year in 2022[35]. Product Development and Pipeline - The company has 31 products in the pipeline, with 26 being developed as innovative drugs in mainland China[6]. - The company has 7 oncology products, 13 products targeting autoimmune diseases, 9 nephrology products, and 2 dermatology products in its pipeline[6]. - The company has completed the new drug application for the anti-TNFα pre-filled injection (301S) in 2022, which was approved for market launch in March 2023[14]. - The company has made significant advancements in clinical trials, including the completion of patient enrollment for several phase II and III studies[15]. - The clinical trial for the oral disintegrating tablet TRK-820, aimed at treating pruritus in patients undergoing maintenance hemodialysis, has successfully met its primary endpoint[51]. - The group plans to initiate Phase III clinical trials for Peg-EPO (RD-01) in the second half of 2023[52]. - The Phase II clinical trial for HIF-117 (SSS17), a small molecule HIF prolyl hydroxylase inhibitor for treating anemia, has been initiated[53]. - The group is preparing for clinical trial applications for several small molecule generics in nephrology, autoimmune, and dermatological fields[46]. Financial Performance - The company's revenue for the fiscal year 2022 reached RMB 6,859,433,000, marking a continuous growth trend across its core business segments[12]. - The normalized net profit attributable to the parent company was RMB 2,162,807,000, reflecting a significant increase compared to previous years[12]. - The company reported a normalized EBITDA of RMB 2,796,255,000, showcasing its operational efficiency and profitability[12]. - The company's total assets increased to RMB 21,988,704,000, while total liabilities rose to RMB 6,588,254,000, indicating a solid financial position[12]. - The revenue from medical institutions accounted for approximately 14% of Mandi's total revenue, with a year-on-year growth of about 2%[35]. - Revenue from retail pharmacies represented around 25% of Mandi's total revenue, showing a year-on-year increase of approximately 65%[35]. - E-commerce revenue constituted about 60% of Mandi's total revenue, with a year-on-year growth of around 58%[35]. - The sales revenue of Yisai Pu decreased to approximately RMB 511.6 million, a decrease of about RMB 277.1 million or approximately 35.1% compared to RMB 788.7 million for the year ended December 31, 2021[61]. Strategic Partnerships and Collaborations - The company has entered into global strategic partnerships, including licensing agreements for antibody-drug conjugates and PD-1 monoclonal antibodies, with potential milestone payments totaling hundreds of millions of dollars[16]. - The company has signed a licensing agreement with Syncromune for the global development and commercialization of its anti-PD1 monoclonal antibody (code: 609A) for tumor immunotherapy, receiving an upfront payment and potential future milestone payments[20]. - The company has entered into a licensing agreement with Kelingyuan for the global rights to develop and commercialize the antibody sequence of CAPTIV for ADC development, receiving an upfront payment and potential milestone payments[21]. - The company has established partnerships with research institutions and companies to leverage expertise in developing competitive new products, but maintaining these relationships is not guaranteed[87]. Corporate Governance and Leadership - The company has a strong leadership team, including Dr. Liu Jing, who has been instrumental in the development of key products and has extensive experience in the pharmaceutical industry[91]. - The company emphasizes high standards of corporate governance to protect shareholder interests and enhance corporate value[177]. - The board consists of two executive directors, one non-executive director, and four independent non-executive directors, ensuring compliance with the Hong Kong Stock Exchange listing rules[179]. - The company has adopted a board diversity policy to enhance competitive advantage, considering factors such as gender, age, cultural background, and professional qualifications[179]. - The company provides necessary onboarding training for new directors and encourages continuous professional development to update their knowledge and skills[183]. Market Expansion and Future Outlook - The company aims to market its products in developed countries and collaborates with international partners for product development and marketing[6]. - The company aims to optimize the structure of chronic disease medications and deepen its presence in grassroots markets in response to national healthcare initiatives[17]. - The company expects a comprehensive recovery in drug demand in 2023, driven by the release of medical consumption needs and new national medical insurance policies[57]. - The company aims to accelerate the launch of multiple products in its research pipeline in 2023, including the unique Minoxidil foam for sensitive scalp patients[57]. - The company is likely to leverage the extensive network and experience of its directors to explore new market opportunities and partnerships[96][97]. Compliance and Risk Management - The group faces intense competition in the biotechnology and pharmaceutical industry, which may hinder its ability to compete effectively with existing and future competitors[83]. - The company has adhered to all relevant rules and regulations that significantly impact its operations during the reporting period[167]. - There were no serious violations of internal rules or relevant Chinese laws by employees or distributors in promoting the company's pharmaceutical products[169]. - The company confirmed compliance with the relevant Hong Kong Stock Exchange rules regarding related party transactions[160]. Shareholder Information - The company proposed a final dividend of HKD 0.10 per share for the year ended December 31, 2022, down from HKD 0.20 in 2021[102]. - As of December 31, 2022, the company's distributable reserves were approximately RMB 3,624.9 million, compared to RMB 4,082.3 million as of December 31, 2021[110]. - The company has a total of 2,438,870,412 shares issued as of December 31, 2022[125]. - Major shareholders include Decade Sunshine Limited and Century Sunshine Limited, each holding 476,774,553 shares, representing 19.55% of the total issued shares[135].

Financial Performance - The company's revenue for the year ended December 31, 2022, was RMB 6,859.4 million, representing a 7.5% increase from RMB 6,382.0 million in 2021[5] - Gross profit for the same period was RMB 5,671.9 million, with a gross margin of 82.7%[5] - Normalized EBITDA increased to RMB 2,162.8 million, reflecting a growth of 25.2% compared to the previous year[2] - Net profit attributable to the parent company was RMB 1,914.9 million, up from RMB 1,651.2 million in 2021, marking a year-on-year increase of 16.0%[5] - Total customer contract revenue for 2022 reached RMB 6,859,433 thousand, an increase of 7.46% from RMB 6,382,009 thousand in 2021[21] - Revenue from the sale of biopharmaceuticals was RMB 6,693,558 thousand in 2022, up from RMB 6,271,104 thousand in 2021, reflecting a growth of 6.73%[22] - Revenue from contract development and manufacturing operations increased to RMB 165,875 thousand in 2022, compared to RMB 110,905 thousand in 2021, marking a growth of 49.6%[22] - Other income for 2022 amounted to RMB 233,010 thousand, an increase of 51.0% from RMB 154,258 thousand in 2021[25] - The pre-tax profit for the group was RMB 355,885 thousand in 2022, compared to RMB 184,023 thousand in 2021, representing an increase of 93.1%[27] - The group’s interest income rose significantly to RMB 150,655 thousand in 2022 from RMB 74,448 thousand in 2021, an increase of 102.5%[25] Assets and Liabilities - Total current assets increased to RMB 9,760.9 million from RMB 7,790.7 million in the previous year[9] - Non-current assets rose to RMB 12,227.8 million, compared to RMB 11,421.9 million in 2021[9] - Total equity increased to RMB 15,400.5 million from RMB 14,657.8 million in the previous year[12] - The company’s cash and cash equivalents decreased to RMB 2,150.3 million from RMB 2,868.1 million in the previous year[8] - The total trade receivables as of the end of 2022 were RMB 1,282,926,000, a decrease from RMB 1,346,626,000 in 2021[34] - Trade payables and notes payable totaled RMB 249,495,000, an increase from RMB 230,407,000 in the previous year[39] - The company has bank loans totaling RMB 4,065,483,000, with a range of interest rates from 1.48% to 6.27%[40] - The total interest-bearing bank borrowings increased to approximately RMB 2,265.0 million as of December 31, 2022, from approximately RMB 314.3 million as of December 31, 2021, reflecting an increase of RMB 2,081.8 million in new bank loans[96] - The group's leverage ratio increased from approximately 2.1% as of December 31, 2021, to approximately 14.7% as of December 31, 2022, primarily due to the increase in bank borrowings[97] Market and Product Development - The company operates solely in the biopharmaceutical sector, focusing on the development, production, marketing, and sales of biopharmaceutical products[19] - The company’s core products include Tevazo, which holds a 64.8% market share in the platelet reduction therapy market in China[43] - The company has a 44.5% market share in the rhEPO market, maintaining its leadership for over 20 years[43] - The company’s product, Mandi, dominates the minoxidil market with a 71.7% market share[43] - The company has initiated a contract development and manufacturing operations (CDMO) business to enhance revenue since December 2021[43] - The 5% minoxidil foam application for androgenetic alopecia has been accepted by the National Medical Products Administration, aiming to be the first approved minoxidil foam product in mainland China[45] - The company has entered into a licensing agreement with Cosmo Pharmaceuticals for the exclusive rights to develop and commercialize Winlevi® in Greater China, along with a right of first refusal for Breezula®[48] - The company has 31 products in active development, with 26 of them being innovative drugs in mainland China[68] - The company is actively developing innovative biological products, including monoclonal antibodies and small molecule drugs targeting various diseases such as kidney disease, tumors, and autoimmune diseases[68] Research and Development - R&D costs decreased to approximately RMB 693.2 million, down about RMB 60.7 million or approximately 8.1% year-over-year, with an R&D cost ratio of about 10.1%[86] - The company has a research team of nearly 600 experienced scientists focused on accelerating clinical development and seeking breakthrough therapies[67] - The company plans to initiate Phase III clinical trials for Peg-EPO (RD-01) in the second half of 2023 after completing discussions with the National Medical Products Administration[71] - The company has completed patient enrollment for the Phase III clinical trial of NuPIAO (SSS06) by the end of 2022[71] - The Phase II trial for the anti-IL17A monoclonal antibody (608) in plaque psoriasis patients has achieved its primary endpoint, with Phase III enrollment expected to complete in the first half of 2023[71] Shareholder Returns and Dividends - The company proposed a final dividend of HKD 0.10 per share for the year ended December 31, 2022[2] - The board proposed a final dividend of HKD 0.10 per share for the year ended December 31, 2022, down from HKD 0.20 per share for the previous year[104] Corporate Governance - The audit committee, consisting of three independent non-executive directors, reviewed and approved the accounting principles and practices adopted by the group during the reporting period[112] - Ernst & Young confirmed that the financial data in the preliminary performance announcement was consistent with the draft consolidated financial statements, although no formal audit was conducted[113]

Market Share and Product Development - The company holds a 66.0% market share in the platelet reduction treatment market in mainland China as of the first half of 2022[5]. - The company has a 44.1% market share in the rhEPO market in mainland China, maintaining its leadership for the past 20 years[5]. - The company achieved a 28.2% market share in the TNFα market in mainland China during the first half of 2022[5]. - Tebiao's market penetration for CIT and ITP in mainland China is estimated to be approximately 28% to 40%, with a market share of 27.0% by volume and 66.0% by sales value in the treatment of thrombocytopenia as of the first half of 2022[32]. - Yisaipu, the first TNFα inhibitor product launched in mainland China, held a market share of 28.2% in the TNFα inhibitor market in the first half of 2022[36]. - Mandi (Minoxidil) captured a market share of 71.9% in mainland China, with sales increasing by 42.0% year-on-year[40]. Research and Development - The company has 33 products in development, with 26 being innovative drugs in mainland China[6]. - The company is focusing on research and development to provide innovative therapies for patients in mainland China and globally[6]. - The R&D team consists of nearly 600 experienced scientists focused on developing new drugs and accelerating clinical development to meet unmet medical needs[55]. - The ongoing projects include 11 oncology products and 13 products targeting autoimmune diseases, with a focus on conditions such as resistant gout and age-related macular degeneration[56]. - The company is developing innovative biopharmaceuticals and small molecule drugs targeting various diseases, including cancer, autoimmune diseases, and inflammatory conditions[54]. Financial Performance - Revenue decreased by RMB 15.7 million or 0.5% to RMB 3,091.4 million compared to the six months ended June 30, 2021[14]. - Gross profit decreased by RMB 22.1 million or 0.9% to RMB 2,565.0 million, with a gross margin decline from 83.3% to 83.0%[14]. - Net profit attributable to the parent company increased by RMB 55.6 million or 6.2% to RMB 954.5 million[14]. - Normalized net profit increased by RMB 63.8 million or 6.9% to RMB 993.6 million[14]. - EBITDA increased by RMB 85.2 million or 7.2% to RMB 1,262.6 million, while normalized EBITDA rose by RMB 95.6 million or 8.1% to RMB 1,273.2 million[14]. - The total comprehensive income decreased by RMB 134.6 million or 13.3% to RMB 879.8 million[14]. Strategic Partnerships and Collaborations - The company signed a licensing agreement with Syncromune for the global development and commercialization of its anti-PD1 monoclonal antibody, with initial payments received and potential future milestone payments expected[16]. - The company entered into a collaboration agreement with Cosmo Pharmaceuticals for exclusive rights to develop and commercialize acne treatment in Greater China, including milestone payments and sales royalties[26]. - The company has established a strategic partnership with Yonghe Hair Transplant to expand Mandi's sales channels across over 2,000 medical institutions and nearly 90,000 retail pharmacies[40]. Operational and Employee Insights - The company employs 5,160 staff across its operational facilities in Shenyang, Shanghai, Hangzhou, Shenzhen, and Como, Italy[7]. - The group has a large sales and distribution network in mainland China, consisting of approximately 2,611 sales and marketing personnel, 1,020 distributors, and 1,805 third-party promoters[69]. - The group’s products are sold in over 2,500 tertiary hospitals and more than 5,000 secondary or lower-level hospitals and medical institutions across all provinces, autonomous regions, and municipalities in mainland China[69]. Cash Flow and Financial Position - The net cash inflow from operating activities for the six months ended June 30, 2022, was approximately RMB 1,073.4 million, an increase of about RMB 261.9 million or 32.3% compared to RMB 811.5 million for the same period in 2021[103]. - The total bank borrowings as of June 30, 2022, amounted to approximately RMB 1,568.0 million, significantly increasing from RMB 314.3 million as of December 31, 2021[106]. - The leverage ratio increased from approximately 2.1% as of December 31, 2021, to about 10.9% as of June 30, 2022, primarily due to the increase in bank borrowings[108]. - The company reported a foreign exchange gain of RMB 51,033 thousand from the translation of overseas operations, compared to a loss of RMB 16,347 thousand in the previous year[171]. Shareholder and Governance Information - The company does not recommend any interim dividend for the six months ended June 30, 2022[126]. - The company completed the repurchase of 85,760,087 shares, representing approximately 3.4% of the total issued shares, for a total consideration of HK$581,453,389.86, at HK$6.78 per share[132]. - The company’s governance structure currently does not separate the roles of chairman and CEO, which the board believes ensures consistent leadership direction[121]. - Major shareholder Decade Sunshine Limited owns 476,774,553 shares, accounting for 19.55% of the total issued shares[147].

Market Position and Share - The company holds a 72.1% market share in the platelet reduction treatment market in mainland China for its product Tevazo, according to IQVIA data[5]. - The company has a 42.4% market share in the rhEPO market in mainland China, maintaining its leadership for the past 20 years[5]. - The company’s product Yisaipu captured a 29.5% market share in the TNFα market in mainland China in 2021[5]. - Tebiao accounted for 30.2% of the market share by volume and 72.1% by sales in the mainland China market for treating thrombocytopenia in 2021[23]. - Yibiao has maintained a dominant position in the rhEPO market in mainland China since 2002, with continued sales growth attributed to increased coverage of primary healthcare institutions and its inclusion in the National Essential Medicines List[24]. - Yisai Pu captured 29.5% of the TNFα inhibitor market share in mainland China in 2021, with sales occurring in over 3,700 hospitals[26]. - Mandi achieved a market share of 71.2% in mainland China in 2021, with sales growth of 63.7% year-on-year[29]. Financial Performance - In 2021, the company achieved a revenue of RMB 6,382,009 thousand, representing a growth of 14.3% compared to 2020[9]. - The normalized EBITDA for 2021 was RMB 2,190,250 thousand, an increase of 36.4% from RMB 1,606,119 thousand in 2020[9]. - The company reported a net profit attributable to shareholders of RMB 1,651,247 thousand in 2021, up 97.5% from RMB 835,791 thousand in 2020[9]. - The total assets of the company increased to RMB 19,212,575 thousand in 2021, up from RMB 17,678,195 thousand in 2020[9]. - The group’s revenue for the year ended December 31, 2021, was approximately RMB 6,382.0 million, an increase of about RMB 794.4 million or 14.2% compared to RMB 5,587.6 million for the year ended December 31, 2020[49]. - The group's gross profit increased to approximately RMB 5,275.7 million, a rise of about RMB 751.0 million or approximately 16.6% from RMB 4,524.7 million in the previous year, with a gross margin of approximately 82.7%[52]. - The company's net profit for the year ended December 31, 2021, was RMB 1,627,573,000, representing a significant increase of 111% compared to RMB 771,106,000 in 2020[199]. Research and Development - The company has 33 products in its pipeline, with 26 being developed as innovative drugs in mainland China[5]. - The R&D expenses for 2021 reached RMB 753,872 thousand, reflecting a 27.6% increase from RMB 590,343 thousand in 2020[9]. - The company is focusing on research and development to provide innovative therapies for patients in mainland China and globally[6]. - The company is actively developing 33 pipeline products, with 26 of them being innovative drugs in mainland China, including 10 oncology products and 16 targeting autoimmune diseases[35]. - The R&D team consists of nearly 600 experienced scientists focused on accelerating clinical development and seeking breakthrough therapies to meet unmet medical needs[35]. - The company has made significant contributions to drug research and development, with key scientists leading the successful development of innovative drugs[78]. Clinical Trials and Approvals - The company has made significant progress in clinical trials, with 7 advancements in Phase I and II trials in 2021[12]. - The phase III clinical trial for TRK-820, a treatment for refractory pruritus in patients undergoing maintenance hemodialysis, has successfully met its primary endpoints, with NDA submission completed and accepted by NMPA[38]. - The company has initiated phase III clinical trials for TPO in children with immune thrombocytopenic purpura (ITP), with patient enrollment completed in February 2022[38]. - The company has received IND approval for the anti-IL17A monoclonal antibody (608) to treat plaque psoriasis, with phase III trials expected to start by the end of 2022[41]. - The company has completed phase I clinical trials for the anti-PD1 monoclonal antibody (609A) in the U.S., with ongoing phase II trials in mainland China[41]. Strategic Initiatives and Partnerships - The company aims to expand its product marketing to developed countries and has received approvals for its products in multiple countries, including 9 for Tevazo and 23 for Yibiao[6]. - The company is actively pursuing global partnerships to enhance its product offerings and expand into international markets[13]. - The company has established a CDMO business platform to empower domestic biotech companies and accelerate the launch of high-quality domestic new drugs[47]. - The company has entered into a collaboration with Toray to introduce TRK-820, targeting the unmet clinical needs of dialysis itch patients in China[47]. - The company signed a licensing agreement with Syncromune for the global development and commercialization of its anti-PD-1 monoclonal antibody (code: 609A), which has shown stronger anti-tumor activity in early models compared to existing drugs[19]. Corporate Governance and Management - The company has a strong leadership team with extensive experience in the pharmaceutical and investment sectors, enhancing its strategic planning and capital operations[80]. - The company is committed to maintaining high standards of corporate governance through its independent directors and audit committees[80]. - The company has established service contracts for executive directors with a term of three years, automatically renewable[159]. - The company has adopted a board diversity policy to enhance its competitive advantage, considering factors such as gender, age, and professional qualifications[155]. - The company encourages continuous professional development for its directors, providing necessary training and updates on company performance and responsibilities[156]. Market Expansion and Future Outlook - The company is focused on expanding its market presence and exploring new technologies to drive growth[79]. - The company anticipates significant growth in the hair restoration market, with over 250 million individuals suffering from hair loss in China, driven by increased awareness of hair health[46]. - Future guidance indicates a projected revenue growth of approximately 15% year-over-year, driven by new product launches and market expansion efforts[83]. - The company is exploring potential mergers and acquisitions to enhance its competitive position and broaden its product offerings in the market[85]. Compliance and Risk Management - The company has established detailed internal rules regarding environmental protection and has complied with national and local environmental laws and regulations[140]. - The audit committee reviewed the accounting principles and policies adopted by the group and found the risk management and internal control systems to be effective and sufficient[145]. - The company has established a comprehensive risk management and internal control system, with no significant internal control deficiencies identified as of December 31, 2021[175]. - The company emphasizes the importance of timely and comprehensive information disclosure to facilitate informed investment decisions by shareholders and investors[180].

Market Position and Product Development - The company holds a leading market share of 72.3% in the platelet reduction treatment market in mainland China for its product Tev-Tropin as of the first half of 2021[4]. - The company has 35 products in the pipeline, with 24 being developed as innovative drugs in mainland China, including 21 monoclonal antibodies[5]. - The company achieved a market share of 42.8% in the rhEPO market and 31.5% in the TNFα market in mainland China during the first half of 2021[4]. - The market share of Teibiao in the treatment of thrombocytopenia in mainland China was 29.4% by volume and 72.3% by sales[20]. - Yibiao remains the only rhEPO product approved by the National Medical Products Administration for three indications, with a dominant market position in China's rhEPO market since 2002[23]. - Yisaipu, the first TNFα inhibitor in the Chinese market, held a 31.5% market share in the TNFα inhibitor market in China during the first half of 2021[24]. - Mandi, the first over-the-counter hair loss treatment in China, captured a 71.5% market share in the first half of 2021, with sales increasing by 102% year-on-year[28]. Financial Performance - Revenue increased by RMB 412.0 million or 15.3% to RMB 3,107.1 million compared to the six months ended June 30, 2020[5]. - Gross profit rose by RMB 370.1 million or 16.7% to RMB 2,587.1 million, with a gross margin increase from 82.3% to 83.3%[5]. - Net profit attributable to equity holders increased by RMB 196.4 million or 28.0% to RMB 898.9 million[5]. - Normalized net profit increased by RMB 180.8 million or 24.1% to RMB 929.8 million[5]. - EBITDA rose by RMB 174.5 million or 17.4% to RMB 1,177.4 million, while normalized EBITDA increased by RMB 128.2 million or 12.2% to RMB 1,177.6 million[5]. - Total comprehensive income increased by RMB 73.0 million or 7.8% to RMB 1,014.4 million[5]. Research and Development - The company is focusing on research and development to provide innovative therapies for patients in both mainland China and globally[5]. - The company has a research team of nearly 600 experienced scientists focused on accelerating clinical development and seeking breakthrough therapies to meet unmet medical needs[45]. - The company is actively developing 35 pipeline products, with 24 of them being innovative drugs in mainland China[46]. - The company plans to submit multiple IND applications for new biological drug candidates with potential to be first-in-class or best-in-class within the next 12 months[43]. - The company has completed a Phase III clinical trial for TRK-820, which targets treatment-resistant pruritus in hemodialysis patients, and plans to submit a new drug application by Q4 2021[50]. Strategic Initiatives and Collaborations - The company aims to expand its product marketing to developed countries and has received approvals for its products in multiple countries, including 9 for Tev-Tropin and 22 for Epoetin Alfa[5]. - The company is exploring strategic partnerships for contract development and manufacturing operations (CDMO) to enhance revenue[4]. - The company is actively pursuing global collaborations with leading biotech firms to develop new drugs and introduce global products to meet unmet clinical needs in China[70]. Sales and Distribution - The company has established a national distribution network selling products to over 7,500 hospitals and medical institutions across mainland China[6]. - The company has a large sales and distribution network in mainland China, consisting of approximately 2,793 sales and marketing personnel, 722 distributors, and 2,302 third-party promoters[63]. - The company's revenue from external customers in mainland China was RMB 3,053,540 thousand, a rise of 16.4% from RMB 2,623,503 thousand in the same period of 2020[191]. Employee and Corporate Governance - The company employs over 5,200 staff across its operational facilities in Shenyang, Shanghai, Hangzhou, Shenzhen, and Como, Italy[6]. - The company has established various incentive plans, including stock options and cash rewards, to motivate eligible participants contributing to its business success[114]. - The board of directors has not separated the roles of chairman and CEO, believing that this arrangement ensures consistent leadership direction[120]. Financial Position and Cash Flow - The net cash inflow from operating activities for the six months ended June 30, 2021, was approximately RMB 811.5 million, an increase of RMB 103.3 million or approximately 14.6% compared to RMB 708.2 million for the same period in 2020[100]. - The company's total equity increased to RMB 14,128,653 thousand in June 2021, compared to RMB 13,093,335 thousand in December 2020, marking a rise of 7.9%[174]. - The company's cash and cash equivalents decreased to RMB 2,919,683 thousand in June 2021 from RMB 3,090,835 thousand in December 2020, a decline of 5.5%[174]. Future Outlook - The company anticipates that the number of clinical applications and approvals for domestic innovative drugs will continue to increase in 2021[64]. - The biopharmaceutical market in China is projected to grow at a compound annual growth rate of nearly 20% over the next five years, with the market size expected to approach RMB 400 billion in 2020[64].