Author: cognitive 认

1. The main highlights of the current of thecxo industry

The development logic of the current CXO enterprise:

From the perspective of the order, the rhythm of each CXO enterprise in hand in hand order is different. The orders of Yaoming Bio have increased significantly in 2022, and the order of Kailei has fallen sharply in hand. Of courseEssenceGenerally speaking, the orders of CXO enterprises from 2019 to 2022 are continuously growing. 21 years are the peak of order growth and the peak of stock prices.

Judging from the newly signed orders, companies such as Kang Longcheng, Kailei, and Tiger Pharmaceutical can only be used to recover, and Yaoming Kant's order is a new high in Zhenger.At present, the most serious fundamental and trend is Yaoming Kangde, but the bill is seriously suppressed by its valuation.

Aside from the influence of the bill, the Federal Reserve ’s interest rate cuts have the greatest impact on CXO companies: Kang Longhua Cheng> Yaoming Bio> Yaoming Kangde> Kailei> Tiger Medicine> Zhaoyan New Medicine.

Tiger Pharmaceutical and Zhaoyan New Pharmaceuticals are dominated by domestic business, and Tiger Pharmaceutical has 14 billion equity investment in China.Heavy)

From the perspective of valuation:

In the 21st year, the valuation of CXO companies is too high, PE is more than 100 times, PB is more than ten times twice, which is no different from the valuation of innovative pharmaceutical companies.Excessive valuations lead to an early overdraft of the stock price. In 22 years, orders increased, and the stock price plummeted.

From the perspective of Hong Kong A premium, the market value of most votes in Hong Kong stocks is lower than that of A shares, and only Hong Kong stocks are higher than A shares.However, when the valuation is the highest, Kang Longcheng, Tiger Pharmaceutical, Yaoming Kangde and Hong Kong stocks are very small.

At present, the valuations of each enterprise have been outrageous. With this year's negative growth, the valuation of the Pharmaceutical Department is only 15 times PE, and the PB is close to the net.

Not to mention that Samsung Biology, which is the same scale as Yao Ming, is 66 times PE, Lonza 72.6 times PE, and Macai Murder also has 37 times PE, and IQV has 32 times PE.

The Hong Kong stocks of Kang Longcheng and Yaoming Kant PE were less than 10 times.

From the perspective of the balance sheet, Hong Kong stocks are the most underestimated in Tiger Medicine, Zhaoyan New Pharmaceutical, and Kailei.

The market value of Tiger Pharmaceutical Port is 2.3.6 billion, with a net cash of 3.18 billion and 13.1 billion equity investment. This part of the equity will increase the valuation of the domestic innovation drug policy;Cash, 780 million equity, is equivalent to giving you 630 million equity funds in vain.Kaile British's market value of 14.37 billion, 7.7 billion cash, and 190 million equity funds.

2. The characteristics of each CXO leading enterprise

Let's talk about the development process of innovative drugs:

According to statistics, the average of 24.3 active molecules (molecules that work on targets) can become an innovative medicine, from the target screening to the average listing of the listing (5.5 years in clinical development, 8 years of clinical experiments, 0.5 ~ 1 year for listing)The absolute value of the cost is 873 million US dollars. If it is discounted at the 12%discount rate, it will take about $ 1.5 billion.

Select 19 molecules with a long role and small side effects from 24 active molecules, and then continuously optimize the molecular chemical structure in these molecules, and then use animals for toxic rational research.molecular.These 12 molecules entered clinical experiments, eliminated 4 phases in the first phase, and 3 were eliminated in the second phase. Only 2 were selected to enter the most expensive three -phase clinical clinical.

(I take the integer here for good understanding. In fact, only 3 of the 50 active molecules can enter the third phase of the clinical clinical)

The main reason for the expensive research and development of innovative drugs is that the failure rate is high, and the cost of failure must be distributed on the successful drugs. Therefore, the cost of clinical experiments was as high as US $ 380 million.

A single active molecule consumes $ 18.5 million from screening to pre -clinical experiments, $ 15 million in clinical phase 1, $ 40 million in clinical 2 phase, $ 150 million in clinical 3 phase, totaling $ 223 million.The most expensive is the clinical of the third phase, and the clinical cost of the third phase accounts for more than 2/3.Therefore, the pharmaceutical company will be very cautious when deciding to enter the third phase of the clinical pipeline. Even so, the pipelines that enter the third phase of the clinical line may not be successful (the failure rate of 30%), and the eliminated pipeline may not be perilogy (being being eliminated (being being eliminated (being being eliminated (being being eliminated.The core R & D personnel who eliminate the pipeline have some resignation and entrepreneurship, financing, and the eliminated molecules are made of medicine)

Drug research and development, the more the molecular weight required for experiments, the different orders corresponding to the different stages of CDMO -such as the maximum of tens of liters in the clinical and phase 1 list, and the second phase of the second phase can reach 300 liters. ThreeThe period can reach 10,000 liters, and the commercialization can reach 10W liters.

1. Yaoming Kant is mainly a small molecule CDMO (small molecular D & M revenue accounts for 54%), followed by new molecular CDMO accounting for 10%and maintains high growth in hand orders (TIDES increases by 147%in hand orders).Clinical CRO accounted for 10%, and clinical CRO (including SMO) accounted for 5%.The basic disk of Yaoming Kang is small molecules, and the high growth of macromolecules is the main point of current highlights.

Yaoming Kant split some of the business of biopharmaceuticals to Yaoming creatures, and Yaoming Biological will then split the high -end business XDC sector in biopharmaceuticals and become currently combined with Yaoming.

2. Pharmaceutical creatures only do CDMO of biopharmaceuticals. The R & D terminal accounts for 60%+, and the M side accounts for less than 40%.The core of Yaoming creatures is at the R & D side, and most of the projects on the M side are obtained from the previous projects.Yaoming creatures focus on front -end research and development, not back -end production, which is different from Samsung Biology and Lonza.

3. Kang Longhua is a CDMO enterprise with the second full -industry chain layout except the Department of Pharmaceutical and Ming. Its main business is laboratory services (accounting for 60%), followed by small molecular CDMO accounting for 21%. Clinical researchIt accounts for 15%.Kang Longhua is also more biased towards the front -end research and development, which means that large amounts of orders account for not high, and depend on small and medium customers, and also benefit from the improvement of the investment and financing environment.About 75%of CMC (small molecule CDMO) comes from existing customers of drug discovery services, which is more similar to Yaoming creatures.

4. Kailai is mainly a small molecule CDMO, and the order amount is concentrated in the commercial stage (52%) and the clinical phase.

The above CDMO leaders are mainly foreign, and foreign business accounts for 75%to 90%.

5. Tiger Pharmaceuticals mainly do clinical CRO and prestigious clinical CRO, mainly focusing on clinical experiments.The biggest highlight of Tiger Medicine is its 13 billion equity investment. The policy of "Full Chain Support Innovation Pharmaceuticals" will be reused.Clinical experimental services are difficult to build factories like CDMO. Domestic and foreign hospitals and doctors are scarce and are difficult to obtain. Therefore, relying on the advantages of their own industrial experience to invest in investment, it is the expansion path of Tiger Medicine.

Other CXO companies in the world:

If Lonza's health products and capsule business (1.2 billion Swiss franc) open, only CDMO business is only the world's first

3. The opportunity to look at CXO from biomedical investment and financing

The impact of the Federal Reserve ’s interest rate cutting on investment and financing data. At present, it can be clearly seen that the interest rate cut in July 2019 and the interest rate hike in February 2022.

In the first half of 2019, the global biomedical investment financing amount was US $ 9.7 billion. In July 2019, the Fed started the first section of interest rate cuts, from 2.5%to 1.75%.It can be seen that interest rate cuts are stimulated by investment and financing.Udabur Wealth Management

In March 2022, the Fed confirmed to raise interest rates. In February, global investment and financing data decreased by 49%month -on -month and a decrease of 34%year -on -year.It can be seen that interest rate hikes hit the investment and financing data.

At present, global biomedical investment and financing data has been gradually recovering, and the bottom of investment and financing data has appeared in November 23rd (the management of Yaoming Bio has mentioned the innovation pharmaceutical industry at the end of last year in the semi -annual report exchange).

At present, there is no difference in the Fed's interest rate cuts, and the differences are only at the amplitude of interest rate cuts.In the future, with the gradual reduction in the Federal Reserve, the amount of biomedical investment and financing will gradually increase.

From a fundamental perspective, the better the investment and financing data, the more signatures received by small and medium -sized innovative pharmaceutical companies, the more orders signed by CXO companies.

There are more than 6,000 active customers in Yaoming Kangde, and TOP20 pharmaceutical companies account for 30%.

There are more than 570 active customers in Yaoming, and the proportion of TOP20 pharmaceutical companies is expected to 45%+.

There are more than 2,800 active customers, and TOP20 pharmaceutical companies account for 14%.

There are more than 1,100 active customers in Kailai, and TOP20 pharmaceutical companies account for 50%.

Considering the winner strategy of Yaoming creatures (the customer's transformation from R & D to M side) and 50%+market share (biopharmaceutical field) of the R & D end of the R & D side, the CDMO enterprise with the most benefit of global investment and financing is Kang Kang, respectivelyLonghua Cheng> Yaoming Biological> Yaoming Kangde> Kailei.

From the perspective of the stock price, the IQV of US stocks is basically the same as changes in investment and financing data.Investment and financing data rose, IQV rose, either investment and financing data rose 2 months first, and IQV then began to rise.

The fluctuations of the four major CDMO companies in A -share and CRO leader Tiger Medicine are almost synchronized. In March 24th, the logic of Tiger Pharmaceutical's logic changed after the domestic industry chain supported innovative drug policy (14 billion equity investment value remembered)There are some separation with the remaining four CDMO faucets.So we only need to compare one of them with investment and financing data. Here I choose Kang Long into.

During the 28 months of investment and financing data, Kang Longhua became 11 months. It was rising for 11 months. The synchronization rate of Kang Longhua into the stock price and investment and financing data was about 40%.Varanasi Stock

Generally speaking, Kang Longhua's stock price will still be affected by investment and financing dataBangalore Wealth Management. Two stock prices are lagging behind investment and financing data to rise in 2 months, and once, it has risen a month before investment and financing data.

In summary, the Federal Reserve reduced interest rate cuts → Improving the amount of biomedical investment and financing → increased order of small and medium customer orders → CXO stock price rising

In terms of economy:

The economy is mainly based on the cost of the same quality. The cost here refers to the cost of research and development of pharmaceutical companies, and it is also the income of CXO companies.

From the perspective of several CXO leading enterprises, labor costs have always been the highest proportion (Kaile British is estimated, deducting depreciation and energy costs in manufacturing costs, estimated labor costs)

At present, the per capita salary of domestic CXO companies is 262,400 yuan, about 36,700 US dollars per year.

The leading enterprise of the global CXO industry is as follows:

From the CDMO, the Lonza and Yaoming Department ranked the top two in the world, and the gap was not large. From the CRO business, IQV and Icon ranked the top two.

From the perspective of per capita salary, the per capita salary of domestic CDMO companies is much lower than that of Europe, America and South Korea, and much higher than India.

India's potential threat is the largest, with low labor cost+low price (CDMO's main charging standard is to charged at the head*, the average net interest rate of Indian CDMO enterprises is less than 13%, and the average domestic is 22%to 25%).The reason why India is a "potential" threat is because the production quality, supply stability, and patent protection awareness of India's CDMO are still poor at present.Establishment is not much at present)

However, in the final analysis, CDMO companies are still manufacturing. Because of the existence of relative cost advantages, the outflow of low -end manufacturing industry is a normal thing, that is, it is normal for domestic low -end CDMO production capacity to flow to India, Southeast Asia and other countries, but it is just a bill.It will speed up this progress.

In other words, high -end CDMOs are difficult to flow out, such as the XDC of Yao Minghe, and the R (especially platform) & D -end business of Yaoming creatures, Yaoming Kant, Kailei's polypeptide and so on.

In addition, the outflow of low -end CDMO orders also requires a long process -the global market share of the Indian CDMO industry has increased from 9.7%in 2018 to 18.5%in 2023. It took 5 years.By 18.5%, it may be more than 5 years, because the influence of COVID has accelerated the Indian CDMO companies entering the global innovative drug supply chain.

Looking at the Biological Safety Act:

There are currently three versions of the bill: S.3558, H.R. 7085 and H.RLucknow Investment. 8333, S.3558 are tried for the Senate, H.R. 7085 and H.R. 8333 were tried to the House of Representatives.Among them, H.R.8333's draft legislation was a revised version of the draft of the "Bios such on the Biological Safety Law" of H.R.7085. H.R8333 removed various claims to Yin Ming Kant on the basis of H.R.7085 and exempted existing contracts.

US Legislative Process -Presidents sent a proposal to the House and sent them to a special committee for reading.After research, improvement, and review, the committee will hold a hearing to perform voting (second reading).After the voting was approved, the committee reported to the House of Lords, planned to openly debate, and conducted voting (three reads) of all members after the debate.The proposal is usually proposed at the Senate and the House of Representatives. If the proposal is approved in all votes, it will be submitted to the president for signing. If the version of the two houses is different in the two houses, the two houses will set up a negotiation committee to solve the differences.

2023.12.20, Senatorgaryc.Peters proposed S.3558 proposal in the Senate,

2024.2.1, S.3558 proposal extension at the meeting of the Senator National Turkey Security Committee, the committee needs to do further discussion before selecting the day for review;

2024.3.6, S.3558 passed the Senate's Land Security and Government Affairs Committee with 14: 1 vote.

On January 25, 2024, the repressentative Mike Gallagher proposed the H.R.7085 proposal in the House of Representatives.

2024.5.10, H.R.8333 Act modification is even more — 60 days after the law enforcement, after the case of execution of the bill, as until January 1, 2032, the enterprise will no longer be allowed to cooperate with new orders, but can continue to execute orders that have been signed, and this is also this.A period of exemption is given, if the exemption conditions can be met, the company on the list can be extended: 60 days after the bill of implementation+exemption period 365 days+exemption period is extended for 180 days (the application can be continued and extended after the exemption period expires).Actary change is mainly based on a survey of BIO -a survey by BIO organization shows that among 124 biomedical companies, 79%of the companies signed at least oneContract or product protocol, and it takes 8 years to convert production suppliers.

There are two ways to establish a bill. The lightest way is to bind to legislation with other bills. The most difficult way is independent legislation.HR.833 wants to legislate through the NDAA bill, but the result is failure.In the FY25NDAA version submitted by the Senate, the relevant content of the "Biological Safety Act" is not mentioned, so the possibility of S.3558 to take NDAA cars is no longer.

At this point, HR.8333, S.3558 each passed the committee (two reads) of the committee (two reads). The time of all voting (three reads) was not determined. From time, it is expected to promote the process by working days in December this year.The possibility of completing the passing before the re -election is lower.

On September 9, 2024, HR.8333 passed, and the Pharmaceutical Kang De Duan fell -11%@, the panic was released, which was half of the landing.The other half also depends on the Senate's S.3558. After all, the two bills must be reached in order to pass, and the final version has not yet landed.

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