SHENYANG XINGQI PHARMACEUTICAL CO.(SZ:300573) Xin Lang Zheng Quan·2025-06-05 01:34Core Viewpoint - The company Xingqi Eye Medicine, which previously dominated the market with its unique "myopia miracle drug" atropine sulfate eye drops, is now facing unprecedented competition as major players like Heng Rui Medicine and Zhao Ke Ophthalmology have received approval for similar products, threatening its market position [1][2]. Group 1: Market Competition - The approval of 0.01% atropine sulfate eye drops in March 2024 significantly boosted Xingqi's revenue, with eye drop sales soaring by 106% to 1.366 billion yuan, contributing over 10% to total revenue [2]. - Competitors such as Heng Rui Medicine and Zhao Ke Ophthalmology are advancing with their own products, with Heng Rui's subsidiary having a substantial sales force of 8,910 compared to Xingqi's 1,197, indicating a potential market share threat [2]. Group 2: Financial Performance - Xingqi's financial performance has been volatile, with net profit soaring by 208% in 2019 due to internal sales rights, but growth slowed to 12.55% in 2022 following new regulations on online prescription drug sales [3]. - The company reported a resurgence in growth of 44.54% in 2024 after the approval of its product, but acknowledged risks of slowing growth and declining market share as the product becomes more widely available [3]. Group 3: Cash Flow and Funding Challenges - The company has invested over 600 million yuan in R&D from 2022 to 2024, representing more than 12% of its revenue, but cash reserves have plummeted from 515 million yuan to 370 million yuan, with short-term loans increasing by 185% to 200 million yuan [4]. - To address its financial challenges, the founder Liu Jidong has opted to dilute his stake through a fundraising effort of 850 million yuan, reducing his ownership from 28.63% to 22.02%, marking the second significant financing attempt in four years [4].