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Health Yuan (600380.SH) disclosed its annual report on April 11, 2023. In 2022, Health Yuan achieved total operating revenue of 17.143 billion yuan, a year-on-year increase of 7.8%; net profit attributable to the parent company reached 1.503 billion yuan, a year-on-year increase of 13.1%; earnings per share were 0.79 yuan. It is noteworthy that, starting from 2018, Health Yuan's net profit attributable to the parent company has achieved steady growth for five consecutive years, successfully doubling.

In 2022, Health Yuan achieved significant qualitative improvement and reasonable quantitative growth by accelerating product innovation, achieving technological breakthroughs, expanding the industrial chain, enhancing comprehensive competitiveness, and accelerating the internationalization process. Throughout 2022, Health Yuan achieved significant results focusing on the two long-term strategies of "innovation" and "internationalization".

Comprehensive "Innovation" Highlights

Health Yuan's business scope covers multiple fields, including chemical preparations, traditional Chinese medicine preparations, chemical raw materials and intermediates, biological products, diagnostic reagents and equipment, and health food. Health Yuan was successfully selected for the "2021 Annual China Pharmaceutical Industry Top 100 Series Rankings" sub-ranking "2021 Annual China Chemical Pharmaceutical Enterprise TOP 100 Ranking" TOP 9.

In 2022, as a leader in inhalation preparations, Health Yuan continued to make efforts in inhalation preparations: four products were approved for listing, five products were declared for production, six products were undergoing clinical/BE research, and two products were approved for clinical trials. It is particularly noteworthy that tobramycin inhalation solution has become the world's first inhalation drug for the treatment of bronchiectasis and the first inhaled antibiotic in China, marking a milestone in the research and development of high-end inhaled preparations in China. In addition, at the beginning of 2023, the listing application for salmeterol/fluticasone propionate inhalation powder was accepted.

Taking advantage of the opportunity of three inhaled preparation varieties being selected for the fifth batch of centralized procurement and one inhaled preparation variety being selected for the seventh batch of centralized procurement, Health Yuan quickly opened up the domestic sales market and continuously improved its market share. In 2022, inhaled preparations showed impressive growth, achieving sales revenue of 1.174 billion yuan, a year-on-year increase of 103.37%.

In addition to inhaled preparations, vaccines are another major "innovation" highlight of Health Yuan. In 2022, the recombinant novel coronavirus fusion protein vaccine (CHO cells) of Lizhu Bio was approved by the National Medical Products Administration to be included in the emergency use of sequential booster immunization for novel coronavirus prevention, and was selected for the "Implementation Plan for the Second Booster Immunization of Novel Coronavirus Vaccines." The full-chain R&D achievement transformation capability, from clinical research, production landing, to approval and listing, and terminal promotion, marks a major breakthrough for Health Yuan in the construction of the recombinant protein vaccine platform and the commercialization of the vaccine track. It is worth mentioning that Anvita, a tocilizumab injection approved for listing at the beginning of 2023, was included in the treatment plan for severe COVID-19 patients, working alongside vaccines to address both prevention and treatment, and improving the epidemic prevention and control system.

Furthermore, the high-barrier complex preparation platform is the solid foundation for the company's "innovation" highlights. Health Yuan continues to increase investment in the construction of innovative high-barrier complex preparation R&D technology platforms represented by inhalation administration, antibody technology, and sustained-release microspheres. In 2022, Health Yuan made significant progress in the R&D of multiple innovative drugs and high-barrier complex preparation products: 6 products were approved for listing, 5 products were declared for production, and 5 products obtained clinical approval documents.

"Innovation" incubation and introduction also became a major highlight of Health Yuan in 2022. In 2022, Health Yuan, together with its subsidiary Lizhu Group established a new industrial investment entity, with a total investment of 1 billion yuan to strategically invest in high-quality major health projects. By "introducing" to increase industrial innovation, a diversified R&D innovation project incubation and introduction platform was built.

"Internationalization" Process Fully Advanced

"Internationalization" is one of Health Yuan's long-term development strategies. Health Yuan stated that its various production enterprises are actively promoting international certification, and the internationalization process will further accelerate.

In 2022, Health Yuan strengthened the market access, product registration, and promotion of inhaled preparations, assisted reproduction, digestive tract, and antiviral products overseas. According to the information, Health Yuan's previous overseas layout mainly focused on the raw materials and intermediates sector. Now, Health Yuan's key products, injection of rabeprazole sodium and rabeprazole enteric-coated tablets, have been successfully approved for listing in Indonesia.

Health Yuan is also actively expanding the overseas market for inhaled preparations. Among them, the improved new drug tobramycin inhalation solution is currently in talks with customers in Europe and Southeast Asia for external technology licensing. Products such as budesonide inhalation suspension and ipratropium bromide inhalation solution are undergoing registration in countries such as the Philippines. Budesonide inhalation suspension has completed registration in Macao and completed the first overseas sales of inhaled preparation products.

In addition, Health Yuan is continuing to promote international cooperation and external licensing of innovative products and pipelines, and is conducting cooperation negotiations with multiple international parties.

While continuously strengthening independent innovation, Health Yuan actively carries out innovative business cooperation models in the global market, and actively seeks opportunities for frontier technology expansion and product internationalization layout through various methods such as collaborative development and licensing introduction, strengthening its commercialization and integration capabilities.

While consolidating its performance, Health Yuan actively explored financing channels to enhance its capital strength. In September 2022, Health Yuan's Global Depositary Receipts (GDRs) were successfully listed on the SIX Swiss Exchange, becoming the first biopharmaceutical company in China to issue and successfully list GDRs in Switzerland.

The successful issuance of GDRs in Switzerland has become an important milestone in Health Yuan's internationalization strategy, possessing an international vision, framework, and operational logic, enhancing its overseas reputation, and thus improving Health Yuan's overall profitability and comprehensive competitiveness. Undoubtedly, Health Yuan is at the forefront of the industry in terms of synergy between industry and finance.

Health Yuan also has an undeniable layout in frontier fields. Health Yuan is clinically-driven, focusing on R&D projects with short-term certainty and frontier technologies with long-term growth potential (such as AI innovative drug molecular design, PROTAC, synthetic biology, gene editing, and cell therapy, etc.).

As a practitioner of "Healthy China," Health Yuan will always adhere to technological innovation as its cornerstone, implement a dual-engine driven strategy of innovative drugs and high-barrier complex preparation technology platforms, and gradually grow into an innovative pharmaceutical enterprise that cares about people's livelihood, is willing to undertake social responsibilities, and has international competitiveness!

Source: Oriental Fortune.com - Serious Finance