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Recently, Health Yuan (stock code: 600380.SH) publicly disclosed the progress of its share repurchase plan. The announcement shows that from August 1, 2023, to August 9, 2023, the company repurchased 2,744,903 shares through centralized bidding transactions, accounting for 0.14% of the company's total share capital, with a payment of 32.0431 million yuan (including handling fees). As of August 14, 2023, the company has repurchased a total of 45,957,211 shares, accounting for 2.40% of the company's total share capital, with a total payment of 557.9157 million yuan (including handling fees).

Market analysts said that as one of the leading pharmaceutical companies in China, Health Yuan's share repurchase at this time has multiple meanings. On the one hand, the pharmaceutical sector has been declining recently, and affected by the industry's "β", Health Yuan's stock price is currently at a relatively low level, which is an important reason why the company chose to repurchase at this time; on the other hand, the company's implementation of the stock incentive plan also represents a positive signal, showing its full confidence in the rigid demand track of pharmaceuticals and its own future upward development.

Equity Incentive Shows Confidence in Development; Pharmaceutical Sector's Long-Term Positive Trend Remains Unchanged

On August 12, Health Yuan disclosed the "Announcement on the Pre-allocation of Stock Options to Incentive Objects." According to the stock option incentive plan, the company plans to grant 5.5 million stock options to 149 mid-level managers and core technical (business) personnel, accounting for 0.29% of the current total share capital.

Regarding the implementation of this stock incentive plan, Health Yuan stated that this is to further attract and retain excellent talents, fully mobilize the enthusiasm of the company's core members, and effectively combine the interests of shareholders, the company, and the core team members. While demonstrating the company's confidence in its future development, it enables all parties to work together for the high-quality development of Health Yuan.

Ultimately, Health Yuan's optimistic expectations for the company's future development also reflect its full confidence in the long-term prosperity of China's pharmaceutical industry. China's pharmaceutical industry has always been a strategic industry related to people's livelihood and an important part of the national economy. Over the past year, China's medical and health system reforms have continued to deepen, the innovation environment has continued to improve, and the pharmaceutical industry has continued to move towards high-quality development with transformation, upgrading, and innovation encouragement. With the acceleration of China's aging population and the continuous improvement of urbanization levels, from a long-term and overall perspective, China's pharmaceutical industry will still show a continuously positive development trend.

Recently, more than 20 institutions have conducted research on Health Yuan, which may also be another dimension of the above-mentioned views. In late July, 26 representatives from 22 institutions, including Anxin Securities, Huatai Securities, E Fund, China Merchants Fund, and Ping An Pension, conducted on-site research on Health Yuan. These institutions inquired about the company's layout of inhalation products, the commercialization expectations of tobramycin inhalation solution, and the progress of the approval of some products. The aforementioned market analysts said that this also fully shows that as a leading high-quality pharmaceutical company, Health Yuan is continuously attracting attention from the capital market and remains within the "sight" of leading institutions.

Deep Squat, Accumulating Strength, Exploring the Future: New Tracks, New Products, New Progress

It is worth mentioning that based on the strong comprehensive advantages formed by its main business, Health Yuan is making new attempts in new medical materials. On April 28, Zhuhai Madefa Biotechnology Co., Ltd. (Madefa), a subsidiary of Health Yuan's holding company, Lizhu Group, announced that its first implantable PHA material P34HB (trade name: Machnoon-II) successfully completed the filing of the main document for Class III medical device raw materials at the Center for Medical Device Evaluation (NMPA) on April 21. This means that medical device manufacturers will no longer need to repeat the biological verification of the materials, greatly saving the development time of medical devices, and medical-grade PHA will achieve safe, stable, and compliant supply. At the same time, this has opened up a new application track for innovative bio-medical PHA materials in China and will further promote the application of PHA in the global medical field.

In terms of product layout, Health Yuan stated that the company's Indacaterol Maleate Inhalation Powder has been submitted for production in the second half of 2022. If this product is successfully approved, it will become the company's first approved powder product, marking a major breakthrough for the company in the powder field. In addition to independent research and development, the company continues to strengthen external cooperation, and this year has successively introduced the influenza drug TG-1000, expanding other respiratory diseases, consolidating the company's leading position in the respiratory field, and the company will subsequently improve the construction of its core product team.

In addition, the company's salmeterol/fluticasone propionate inhalation powder received acceptance of its marketing authorization application in February 2023. This is also the first product in China to submit a marketing application and receive acceptance after the release of the new regulations, and is currently under review by the CDE. It is reported that although the original research product of salmeterol/fluticasone propionate inhalation powder has been off-patent for a long time, no generic drug has been marketed in China so far. Currently, Health Yuan's review progress of this product is in the first echelon. Health Yuan stated that salmeterol/fluticasone propionate inhalation powder is also a promising product in the future, and the company is vigorously promoting the listing of this product.

Zhu Baoguo, chairman of the company, once said that the birth of each new drug and the creation of each new therapy are a process of our understanding of diseases. Under the implementation of the dual-drive strategy of innovative drugs and high-barrier complex preparations, Health Yuan will focus on unmet clinical needs and continuously create new development momentum and advantages.

Source: Securities Market Red Weekly