Core Viewpoint - The company, Gongtong Pharmaceutical, is strategically positioning itself to extend its operations across the entire steroid drug supply chain, from upstream raw materials to downstream finished products, aiming to enhance its competitive edge and profitability in the market [1][2]. Group 1: Industry Positioning - Steroid drugs are the second largest category of pharmaceuticals after antibiotics, with extensive clinical applications [1]. - Gongtong Pharmaceutical is recognized as a core supplier of starting materials for steroid drugs, holding over 60% market share in the starting material segment with a production capacity of 3,000 tons [1][2]. - The company is transitioning from a trading entity to a manufacturing powerhouse, focusing on vertical integration within the steroid drug supply chain [1][2]. Group 2: Strategic Expansion - The company is expanding into high-value downstream segments, including raw materials and formulations, aiming to become the first domestic supplier to cover the entire range of steroid drugs [2]. - Gongtong Pharmaceutical has established a dual-driven competitive advantage through technological innovation and cost reduction via vertical integration [2]. - The company plans to increase its certified raw material products globally from 13 to 30-50, addressing the current gap in the domestic market [2]. Group 3: Focus on Reproductive Health - The company is actively involved in the reproductive health sector, particularly in the production of sex hormones and progestogens, with new production capacity supporting 60% of the national demand for progesterone [3]. - Future plans include a comprehensive layout in reproductive health, extending from raw material supply to direct consumer engagement through formulations [3]. Group 4: Technological Advancements - Gongtong Pharmaceutical is leveraging four core technologies: high-end strain modification, efficient plant sterol conversion, enzyme modification of steroid structures, and green chemical synthesis to transition steroid drug production towards biological synthesis and green manufacturing [4]. - The company has seen a continuous increase in R&D investment, focusing on high-growth areas such as anticancer and reproductive health drugs [4]. Group 5: International Expansion - The company's overseas sales have been increasing, projected to reach 60%-70% of total revenue in the future, with 28.54% in 2024 and 38.6% in the first half of 2025 [5]. - Gongtong Pharmaceutical is enhancing its brand promotion and sales channels internationally, with a focus on local partnerships and potential mergers to penetrate foreign markets [5]. - The company’s contract manufacturing services for steroid drugs are expected to significantly contribute to future profits, with a gross margin of over 50% [5]. Group 6: Future Outlook - The company aims to overcome environmental and cost challenges in the short term through green processes, while focusing on breaking technical barriers in high-end formulations in the medium term [6]. - Long-term goals include entering the innovative drug market, transitioning from a follower to a leader in the industry, with a projected trillion-dollar market potential in advanced fields like cancer treatment and gene therapy [6].

Core Insights - The company, Zhonggong Pharmaceutical, is a key supplier of steroid drugs and is strategically expanding its operations from upstream to downstream in the industry chain [1][2] - The company aims to accelerate the integration of high-end steroid raw materials and formulations, which will require significant investment and may lead to short-term pressure [1][2] Industry Chain Integration - The production of steroid drugs involves multiple stages: starting materials, intermediates, active pharmaceutical ingredients (APIs), and formulations. Zhonggong Pharmaceutical has established itself as a source factory for steroid drugs by deeply engaging in the starting materials and intermediates [1] - The company has a production capacity of 3,000 tons for starting materials, holding over 60% market share, and offers more than 100 types of intermediates, including estrogen, androgen, progestogen, and corticosteroid [1][2] Downstream Expansion - Zhonggong Pharmaceutical is extending its strategic focus to the higher value-added downstream sectors, including APIs and formulations, aiming to become the first domestic supplier of a full range of steroid drug APIs [2] - The company has established a dual-driven core competitiveness through technological advancements and cost-effective vertical integration, which is expected to enhance profitability as it moves into higher-value segments [2] Reproductive Health Sector - The application of steroid drugs is expanding in areas such as anti-inflammatory, immune, and reproductive health, with the company planning to cover the entire supply chain in reproductive health, from raw materials to direct consumer products [3] - The company’s new production capacity for a specific intermediate can meet 60% of the national demand for progesterone, providing it with strong bargaining power [3] R&D and International Expansion - Zhonggong Pharmaceutical has been increasing its R&D investment, focusing on high-growth areas such as anti-cancer drugs and reproductive health medications [4] - The company’s overseas sales have been rising, projected to reach 60%-70% of total revenue in the future, with a current overseas sales ratio of 28.54% in 2024, increasing to 38.6% in the first half of 2025 [4] Strategic Partnerships and Market Positioning - The company is exploring joint ventures and acquisitions with local foreign enterprises to better integrate into local markets and overcome certification and trust barriers [5] - Despite holding a significant share of the global raw material market, the company recognizes the need to advance in high-end formulations and innovative targeted drugs, proposing a phased approach to industry transformation driven by technology [5]

Core Viewpoint - SynBioCon reports that the biomanufacturing company, Saito Bio, has announced a change in part of its fundraising investment projects, adjusting the total investment of the original project from 367 million yuan to 229 million yuan, and reallocating 124 million yuan to a new project focused on biosynthetic technology research and industrialization [3]. Group 1: Investment Project Changes - The new investment project, "Biosynthetic Technology Research and Industrialization Project," has a total investment of 237 million yuan, with the implementation led by its wholly-owned subsidiary, Jinweiduo, aiming to establish production lines for 1,000 tons/year of Tartrate Tylosin and 200 tons/year of Phosphate Tylosin [5]. - Tartrate Tylosin and Phosphate Tylosin are commonly used drugs for preventing and treating mycoplasma infections in animals, significantly reducing the incidence of respiratory diseases in livestock, indicating strong market demand [5]. Group 2: Company Background and Strategy - Established in 2010, Saito Bio was the first to utilize genetic engineering and synthetic biology for the large-scale production of steroid drug raw materials, becoming a leading supplier of steroid drug raw materials in China [5]. - In 2019, Saito Bio set a long-term industrial upgrade strategy to create a biomanufacturing enterprise integrating "pharmaceutical intermediates - active pharmaceutical ingredients - formulations," successfully producing five major steroid raw material series using synthetic biology [5]. Group 3: Strategic Collaborations - In 2024, the company formed a strategic partnership with AI pharmaceutical company, InSilico Medicine, to leverage cutting-edge AI technology and optimize key steps in the engineering transformation process for synthetic biology research and innovative drug development [6].

Group 1 - The company, Saito Bio (300583), produces key starting materials for common COPD treatments, including dehydroepiandrosterone, betamethasone, and indacaterol maleate [1] - The company does not currently produce formulations specifically for COPD [1]

Group 1 - The company produces key starting materials for common COPD (Chronic Obstructive Pulmonary Disease) treatments, including dehydroepiandrosterone, betamethasone, and indacaterol maleate [1] - The company does not currently produce formulations specifically for COPD [1]