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On the evening of August 10, Joincare Pharmaceutical Group Industry Co., Ltd. (Joincare, 600380.SH) released its 2022 semi-annual performance report. The report shows that Joincare achieved operating revenue of 8.565 billion yuan in the first half of 2022, a year-on-year increase of 9.31%; net profit attributable to shareholders of the listed company reached 801 million yuan, a year-on-year increase of 16.57%, with basic earnings per share of 0.4235 yuan.

According to the semi-annual report data, Joincare's non-net profit attributable to the parent company in the first six months of 2022 was 804 million yuan, a year-on-year increase of 34.47%, mainly due to the increase in sales revenue of chemical preparations and raw materials, driving the growth of net profit. Net cash flow from operating activities was 1.903 billion yuan, a year-on-year increase of 155.16%, mainly due to increased sales receipts during the reporting period.

Chemical preparations have become Joincare's largest source of revenue. Among them, digestive system drugs, anti-infective drugs, and gonadotropin drugs are the company's traditional advantageous products. Key products have long held a leading position in the national pharmaceutical preparation sub-market. Respiratory system drugs and psychotropic drugs, as the company's key products in recent years, have shown strong sales growth. During the reporting period, Joincare's respiratory field achieved sales revenue of 561 million yuan, a year-on-year increase of approximately 259%.

Focus on the growth logic of the inhalation preparation track and accelerate the commercialization of new products.

Respiratory diseases are the third largest chronic disease in China, after cardiovascular diseases and diabetes. According to data from MiNet, in 2021, the combined scale of six major respiratory chemical drugs in three major terminal markets exceeded 50 billion yuan. Inhalation preparations, with their many advantages, are gradually showing particularly excellent efficacy. With the popularization of early screening, early diagnosis, and early treatment in China, increasingly standardized medication, and the acceleration of domestic substitution, the market for inhalation drugs will further expand.

In order to address the actual needs of domestic patients and the accessibility of medication, Joincare entered the inhalation preparation market in 2013. Since 2019, several blockbuster products have been successively approved, breaking the monopoly of the original research drug market. With the soaring sales driven by national centralized procurement, in the first quarter of 2022, the company successfully squeezed into the top 10 respiratory chemical drug companies and became the domestic leader in the sub-market for obstructive airway disease drugs.

According to the semi-annual report, Joincare's inhalation preparation R&D progress is very smooth: Levosalbutamol Hydrochloride Inhalation Solution (3ml:1.25mg) and Terbutaline Sulfate Inhalation Solution have been approved for marketing; Tobramycin Inhalation Solution (Class 2.4) has successfully completed supplementary research and is currently under review; Fluticasone Propionate Inhalation Suspension has submitted a marketing authorization application; Salmeterol/Fluticasone Inhalation Powder has obtained a clinical trial approval notice and quickly launched Phase III clinical research; Indacaterol Maleate Inhalation Powder is accelerating PD-BE research; Class 2 new drug XYP-001 has completed preclinical research. In addition, Joincare submitted its first registration application for a medical device配套吸入产品, achieving a new breakthrough in the medical device field, forming synergy with inhalation preparations, consolidating the company's core competitiveness in the respiratory disease field, and continuously consolidating and enhancing its position as a "leading domestic inhalation preparation track".

Continuously consolidate profitability and launch a new equity incentive plan.

In the first half of 2022, under the environment of sporadic outbreaks of the epidemic and increasingly stringent industry regulations and access policies, Joincare actively implemented sales deployment, increased market promotion efforts, strengthened sales professionalism, and simultaneously increased digital marketing, deepened refined management, and steadily achieved growth in main business revenue and consolidated the foundation and capabilities for the company's sustainable development. During the reporting period, the sales volume of Joincare's key products in key specialty areas achieved rapid growth, especially the sales revenue of key pharmaceutical products in the respiratory system, mental health, and gonadotropin fields continued to contribute to the company's overall revenue; at the same time, the company integrated resources, adjusted product structure, increased international certifications, and actively used advanced technologies such as synthetic biology and continuous production to achieve green production, steadily improving the gross profit margin of the raw materials sector and significantly increasing sales revenue.

After years of development, Joincare has become a comprehensive pharmaceutical company covering multiple fields, including chemical preparations, chemical raw materials and intermediates, traditional Chinese medicine preparations, diagnostic reagents and equipment, and health food, and has formed strong competitive advantages in multiple therapeutic areas such as respiratory, anti-infection, assisted reproduction, digestive tract, mental health, and tumor immunity.

With its strong R&D capabilities, diversified product matrix, and leading commercialization capabilities, Joincare has rapidly achieved synergistic development among industrial chains, and its profitability has continued to improve. Based on its strong business strength and forward-looking development strategy, Joincare has released its 2022 stock option incentive plan. The source of the shares for this incentive plan is the company's定向发行公司A股普通股 to the incentive recipients. The exercise price (including reserves) of the initially granted stock options is 11.24 yuan/share. This incentive plan plans to grant 55 million stock options to incentive recipients, accounting for approximately 2.95% of the company's total share capital as of the date of the announcement of the draft incentive plan.

Through the implementation of the incentive plan, the company will further establish and improve a long-term incentive mechanism, fully mobilize the enthusiasm and skills of directors, supervisors, senior executives, and core technical and business personnel, and work together to promote the long-term development of Joincare.

Joincare's "differentiated" competitive strategy in R&D pipeline layout has been continuously verified in the steadily growing performance. In the future, Joincare will continue to focus on cutting-edge technologies and unmet clinical needs, focus on innovative drugs and high-barrier complex preparations, continue to strengthen its advantageous technology platforms such as inhalation preparations and sustained-release microspheres, and strive to develop into an innovative comprehensive pharmaceutical group that cares about people's livelihood, takes on social responsibilities, and has industry influence.

(This article does not constitute any investment advice; the information disclosed is subject to the company's announcements. Investors operate at their own risk.)

Source: Daily Economic News