CCHT(SZ:000661) Hua Xia Shi Bao·2025-09-19 09:02Core Viewpoint - Changchun High-tech is facing significant challenges due to price reductions from centralized procurement of its core product, growth hormone, and a lack of new business development, leading to a dramatic decline in net profit by 42.85% in the first half of 2025, marking a potential fall from grace for this once-prominent stock [2][3]. Financial Performance - The company's mid-year report for 2025 shows revenue of 6.603 billion yuan, a year-on-year decrease of 0.54%, and a net profit attributable to shareholders of 983 million yuan, down 42.85% year-on-year, continuing the trend of declining revenue and profit seen in the previous year's annual report [3]. - The net profit decline is the largest for a mid-year report in the past five years, with Q2 2025 revenue at 3.605 billion yuan, a slight increase of 4.16%, but net profit fell by 48.83% to 463 million yuan, primarily due to rising sales and R&D expenses [3][6]. - Over the past five years, revenue growth has significantly slowed, with figures of 4.963 billion yuan, 5.831 billion yuan, 6.168 billion yuan, 6.639 billion yuan, and 6.603 billion yuan from 2021 to 2025, while net profit has dropped from 1.923 billion yuan in 2021 to 983 million yuan in 2025 [3][4]. Business Structure and Risks - The decline in net profit is largely attributed to the poor performance of its core subsidiary, Jinsai Pharmaceutical, and losses at Baike Biotechnology, indicating potential risks in the company's business structure and pipeline layout [4]. - Jinsai Pharmaceutical's heavy reliance on a limited number of products makes it vulnerable to market changes, increased competition, or quality issues, while Baike's losses may stem from an unreasonable pipeline layout and poor market prospects for its R&D products [4][5]. Industry Context - The company’s challenges reflect broader issues within the domestic biopharmaceutical industry, which is transitioning from a "generic-driven" to an "innovation-driven" model, facing high R&D costs and long commercialization cycles [5]. - The market for PD-1/PD-L1 inhibitors in China shrank by 23% year-on-year in 2024, indicating intensified competition in similar therapeutic areas [5]. Expense Management - The company's mid-year report indicates that sales expenses reached 2.386 billion yuan, up 23.43% year-on-year, and R&D expenses were 1.155 billion yuan, up 30.22%, together accounting for 53.6% of total revenue, significantly squeezing profit margins [6][7]. - The increase in sales expenses is attributed to the promotion of new products and expansion into new medical departments, while the rise in R&D expenses is due to advancements in ADC and small nucleic acid technology platforms [6][7]. - The high ratio of total expenses to revenue at 46.97% is above the industry average of 35%, indicating structural issues within the company's expense management [8].