On August 23, 2021 Shanghai Fosun Pharmaceutical (Group) Co., Ltd ("Fosun Pharma" or "the Group"; Stock Code: 600196.SH, 02196.HK), a leading healthcare group in China, reported its interim results for the first half of 2021 ("the Reporting Period") (Press release, Fosun, AUG 23, 2021, View Source [SID1234586856]).
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In the first half of 2021, Fosun Pharma adhered to the implementation of the "4IN" strategy and achieved steady development in the overall business performance. During the Reporting Period, the Group achieved revenue of RMB16,952 million, representing an increase of 20.85% YOY, of which, the income from regions outside Chinese Mainland and overseas countries accounted for 30.66%, marking a step forward on its international operation capability. The net profit attributable to shareholders of the listed company amounted to RMB2,482 million, representing an increase of 44.77% YOY. The net profit attributable to shareholders of the listed company after deducting extraordinary gain or loss amounted to RMB1,570 million, representing an increase of 20.38% YOY.
Innovative products continuously launched with China’s first CAR-T cell therapy approved for marketing
Took innovation and internationalization as its core drivers, as well as increased its R&D investment, through diversified R&D system with independent R&D, cooperative development, license introduction and in-depth incubation, Fosun Pharma accelerated the development of innovative drugs and clinical development, connected with teams of outstanding scientists, leading technologies and high-value products worldwide, to promote the development and transformation of innovative technologies and R&D, based on the overall management of R&D projects by the Global R&D center.
During the Reporting period, Fosun Pharma’s R&D expenditure amounted to RMB1,954 million, representing an increase of 15.69% YOY. In particular, the R&D expenses amounted to RMB1,562 million, representing an increase of 29.73% YOY. As at the end of the Reporting Period, there were nearly 2,600 R&D personnel, of which approximately 1,400 persons obtained master’s degree or above). The Group had 240 major pipeline innovative drugs, generic drugs, biosimilars and consistency evaluation items of generic drugs, of which 72 were innovative drugs.
In June 2021, Yi Kai Da of Fosun Kite, a joint venture, became the first CAR-T cell therapy product approved for launch in China. It is mainly used for the treatment of adult patients with relapsed or refractory large B-cell lymphoma after two or more lines of systemic therapy. In August 2021, National Medical Products Administration ("NMPA") also included its new indications in the Drug List of the Procedure for Breakthrough Therapy Designation. It shows the clinical advantages and potential of this drug in the treatment of relapsed or refractory indolent non Hodgkin’s lymphoma. Fosun Kite is expanding the indications actively, optimizing costs continuously, and exploring diversified payment methods including commercial insurance to increase the product accessibility to benefit more patients.
COMIRNATY (mRNA COVID-19 vaccine, also known as BNT162b2) has been included in the government vaccination programs in Hong Kong SAR and Macau SAR. During the Reporting Period, the vaccine has contributed revenue of over RMB500 million. Besides, Fosun Pharma has planned to supply 15 million doses of mRNA COVID-19 vaccine to Taiwan, which will be donated by the Buyers to the disease control authority for local vaccination. Meanwhile, phase II clinical trials of mRNA COVID-19 vaccine BNT162b2 in Chinese Mainland (excluding Hong Kong, Macau and Taiwan regions) and other works were also progressing in an orderly manner.
Stable growth of core pharmaceutical manufacturing business and multiple innovative products launched to improve product structure
During the Reporting Period, the revenue from core pharmaceutical manufacturing segment maintained steady growth and the product structure continued to be optimized. In the first half of 2021, the pharmaceutical manufacturing segment generated revenue of RMB12,248 million, representing an increase of 22.33% YOY. The R&D expenditure of pharmaceutical manufacturing segment was RMB1,777 million, representing an increase of 15.31% YOY, accounting for 14.51% of the revenue of the pharmaceutical manufacturing segment.
Fosun Pharma is committed to promoting innovative R&D, and is oriented towards fulfilling unmet clinical needs and improving products’ accessibility, accelerating the implementation of innovative technologies and products. After over a decade of continuous investment, many varieties such as Han Li Kang (Rituximab Injection), Han Qu You (Trastuzumab Injection), Su Ke Xin (Avatrombopag Maleate Tablets), Han Da Yuan (Adalimumab Injection) and Yescarta have been approved and sold in large quantities in the past two years，promoting sustainable growth in the Group’s performance.
During the Reporting Period, the sales volume of self-developed product Han Li Kang (Rituximab Injection) achieved substantial sales growth. In the first half of the year, it contributed revenue of RMB724 million, representing an increase of 223.21% YOY. Han Qu You (Trastuzumab Injection) and Su Ke Xin (Avatrombopag Maleate Tablets), which went launched in 2H 2020, recorded revenue of RMB325 million and RMB206 million respectively, in 1H 2021. Within the Reporting Period, revenue of Gland Pharma’s increased by 32.08% YOY, benefited from the contribution from Micafungin, Enoxaparin Sodium Injection and f new products launch. In addition, Gland Pharma continued to optimize the life cycle management of existing products and expand marketing channels, including the sales revenue of Atomolan Tablets (Glutathione Tablets) increased by 60.70% YOY.
Initial integration of diagnosis and medical aesthetic business completed with quality and efficiency improved
During the Reporting Period, Fosun Pharma’s medical device business has initially formed three major business divisions with medical cosmetology, respiratory care, and professional medical care. In the medical cosmetology field, while actively expanding its existing energy-based medical aesthetics equipment business, Sisram Medical carried out business integration on strategic tracks such as aesthetic dentistry and injectable.
In the first half of 2021, Fosun Pharma has actively promoted strategic upgrading and internal integration in the diagnosis segment. According to the business focus and characteristics of the subsidiaries under the diagnosis segment, the Group specified the positioning and functions of each of these subsidiaries as R&D and manufacturing center, differentiated instrument R&D platform, inspection service business platform and reagent manufacturing base. Centered on six major therapeutic areas (tumor, infection, digestion and metabolism, reproduction, cardiovascular, and central nervous system), Fosun Pharma has formed a cross-methodological product portfolio as well as a matrix R&D thinking that expands to different disease fields under the same methodology.
Further improved international operation capability with proportion of overseas revenue exceeds 30%
In the first half of 2021, Fosun Pharma implemented its internationalization strategy in terms of innovative R&D, BD, production, operation, and commercialization. The Group has cultivated a global BD team for deployment in frontier areas through R&D cooperation and license-in projects, while the drug clinical and registration team in the United States, Africa, Europe, and India, continued to strengthen overseas drug registration and application capabilities. At the same time, the Group accelerated the international quality system certification of domestic production lines, and deepened international marketing capabilities so as to further expand the international market. During the Reporting Period, Fosun Pharma achieved revenue of RMB5,198 million in regions outside Chinese Mainland and overseas countries, accounting for 30.66% of the total revenue.
Fosun Pharma has already set up a mature sales network with upstream and downstream customer resources in the English and French-speaking countries and regions in Sub-Saharan Africa. After years of attentive efforts, Fosun Pharma’s subsidiary, Gland Pharma has become one of India’s largest and fastest-growing companies, focusing on the production of injectables, and is active across over 60 countries.
Looking forward, Wu Yifang, Chairman and CEO of Fosun Pharma said, "The development of the entire pharmaceutical industry will be presented with both challenges and opportunities. In the second half of 2021. Fosun Pharma will endeavor to optimize product-oriented strategy, improve the Group’s R&D efficiency to strengthen the globalization, focused on innovation and international development. The Group will enhance innovative R&D capabilities, increase internationalized drug registration and declaration, and strive to develop strategic products. Whilst actively seeking opportunities for mergers and acquisitions to establish and promote the integration and synergy effects in the product lines and supply chains, the Group seeks to achieve continuous growth of its revenue and profits. At the same time, the Group will continue to optimize the operational efficiency in the healthcare service industry, accelerate the construction of competitive disciplines, enhance quality management, push forward the transformation of health industry to internet healthcare services and further promote breakthroughs in the consumer health sector so as to expand the operating scale in the segment and improve its capabilities in operation, management and internationalization."