Proton Pump Inhibitor (PPI) Industry Overview - Proton pump inhibitors (PPIs) are the most potent acid-suppressing medications, widely used for treating acid-related diseases such as peptic ulcers and gastroesophageal reflux disease [1][2] - The Chinese oral PPI market has maintained a scale of over 10 billion yuan from 2018 to 2024, with strong market demand [1][6] - The market has shown volatility due to the implementation of volume-based procurement plans for several generic PPIs, leading to price declines despite increasing sales [1][6] Market Size and Trends - The market size for oral PPIs in China is projected to decline by 10.5% year-on-year in 2024, influenced by price reductions from collective procurement [1][6] - The market for PPIs used for peptic ulcers is valued at 4.8 billion yuan, while the market for those used for gastroesophageal reflux disease is valued at 1.8 billion yuan [6] Product Landscape - As of the end of 2024, there are seven PPI products approved for sale in China, with major products including Rabeprazole, Aplrazole, Esomeprazole, and Omeprazole, collectively holding over 87% market share [1][8] - Rabeprazole leads the market with a share of 27.6%, followed by Aplrazole at 23.7% [1][8] Competitive Landscape - The PPI industry is characterized by intense competition, with numerous companies involved in the production of various PPI products [1][9] - As of July 2025, there are 134 products of Lansoprazole, 106 products of Pantoprazole, and 440 products of Omeprazole produced by over 180 companies in China [1][9] - The leading company for Rabeprazole is Jichuan Pharmaceutical, holding over 30% market share, while AstraZeneca leads the Omeprazole market with a 17.8% share [1][9]

Core Viewpoint - The stock price of Luoxin Pharmaceutical (002793) experienced a significant increase, closing at 6.5 yuan with a 6.04% rise on July 31, 2025, following a series of trading days with abnormal fluctuations [1] Group 1: Stock Performance - The stock reached a yearly high of 6.74 yuan, with a turnover rate of 16.05% and a trading volume exceeding 1.142 billion yuan [1] - The stock was flagged for abnormal trading as its cumulative price deviation exceeded 20% over three consecutive trading days [1][2] Group 2: Financial Performance and Forecast - Luoxin Pharmaceutical has faced continuous losses for three years, with revenues declining from 35.88 billion yuan in 2022 to 26.47 billion yuan in 2024, compared to a peak of 75.89 billion yuan in 2019 [9] - The company reported net losses of 12.26 billion yuan, 6.61 billion yuan, and 9.65 billion yuan over the same period, totaling 28.52 billion yuan in losses, surpassing previous six years' profits of 16.89 billion yuan [9] - The latest earnings forecast for the first half of 2025 indicates a potential net profit of 15 to 20 million yuan, with a basic earnings per share of 0.01 to 0.02 yuan [10] Group 3: Shareholder Changes and Transactions - A significant change in the shareholder structure occurred with the transfer of 5% of shares to Shanghai Zhongjue Private Fund Management Co., Ltd., at a price of 2.03 billion yuan, reflecting a 70% premium over the market price [6] - The transaction resulted in Zhongjue Fund becoming the third-largest shareholder, holding 5% of the shares, while the first and second largest shareholders hold 21.79% and 9.22% respectively [6] Group 4: Asset Transfer and Payment Issues - Luoxin Pharmaceutical has not received the third installment of the payment for the transfer of a 70% stake in its subsidiary, which was valued at 4.15 billion yuan, with only 2.87 billion yuan received to date [3][5] - The performance of the subsidiary, now named Shanghai Luoxin Pharmaceutical (Shandong) Co., Ltd., fell significantly short of its revenue and profit commitments, achieving only 18.32 billion yuan in revenue and 10.69 million yuan in net profit for 2024, which is 31.74% of the promised figures [4][5][11]