[中报]健康元(600380):健康元药业集团股份有限公司2023年半年度报告（英文版）
原标题:健康元:健康元药业集团股份有限公司2023年半年度报告（英文版） Ⅰ The Board of Directors (the “Board”), the Board of Supervisors and directors, supervisors and senior management of the Company hereby warrant the truthfulness, accuracy and completeness of the contents of the interim report (the “Report”), and that there are no false representations, misleading statements or material omissions contained in the Report, and severally and jointly accept responsibility. Ⅱ All the directors of the Company attended the Board meeting. Ⅲ The interim report of the Company is unaudited. Ⅳ Mr. Zhu Baoguo (朱保国), the person-in-charge of the Company, and Mr. Qiu Qingfeng (邱庆丰), the person-in-charge of the Company's accounting work and the person-in-charge of the accounting department (the head of the accounting department), declare that they hereby warrant the truthfulness, accuracy and completeness of the financial statements contained in the Report. Ⅴ Profit distribution plan or plan for conversion of capital reserve to share capital approved by the Board during the Reporting Period Not applicable VI Risk declaration for the forward-looking statements √Applicable □N/A The Report contains forward-looking statements which involve the future plans, development strategies, etc. of the Company, yet do not constitute substantive undertakings of the Company to investors. Investors should exercise caution prior to making investment decisions. VII Whether there is non-operating use of funds by the controlling shareholder and their related parties No VIII Whether there is a violation of the prescribed decision-making procedures to provide external guarantees No IX Whether more than half of directors cannot warrant the truthfulness, accuracy and completeness of the Report disclosed by the Company No X Significant risk warnings There is no exceptionally significant risk that will have a material impact on the productions and operations of the Company during the Reporting Period. The Company has described various risks related to productions and operations that the Company may face and the corresponding response measures taken. Please refer to “Risks” in Chapter 3 “Management Discussion and Analysis”. XI Others □Applicable √N/A Table of Contents Financial Highlights .............................................................................................................................. 5 Chapter 1 Definitions ............................................................................................................................ 7 Chapter 2 Company Profile and Major Financial Indicators ........................................................... 9 Chapter 3 Management Discussion and Analysis ............................................................................. 13 Chapter 4 Corporate Governance ..................................................................................................... 49 Chapter 5 Environmental and Corporate Social Responsibility ..................................................... 51 Chapter 6 Major Events ..................................................................................................................... 85 Chapter 7 Changes in Equity and Shareholders .............................................................................. 97 Chapter 8 Information on Preferred Shares ................................................................................... 101 Chapter 9 Information on Bonds ..................................................................................................... 102 Chapter 10 Financial statements ..................................................................................................... 103
Financial Highlights Financial Highlights Chapter 1 Definitions In this Report, unless the context otherwise requires, the following expressions shall have the following meanings:
*For identification purpose only Chapter 2 Company Profile and Major Financial Indicators I Company profile
II Contact persons and contact details
III Introduction of the Company's basic information
IV Introduction of changes in information disclosure and places for inspection
V Company stock profile
VI Other relevant information □Applicable √N/A VII Principal accounting data and financial indicators of the Company (I) Principal accounting data Unit: Yuan Currency RMB
(II) Principal Financial Indicators
Description of principal accounting data and financial indicators of the Company √Applicable □N/A The net cash flow from operating activities was RMB1,257 million, representing a year-on-year decrease of 33.93%, this decrease was mainly due to the increased collection of promissory notes, decreased cash collections, and increased cash payments for purchasing goods during the Reporting Period. VIII Differences in accounting data under domestic and foreign accounting standards □Applicable √N/A IX Items and amounts of extraordinary gains and losses √Applicable □N/A Unit Yuan Currency: RMB
Explanations for the Company’s extraordinary gain or loss items as defined in the “Explanatory Announcement No.1 for Public Company Information Disclosures – Extraordinary Gains or Losses”, and the extraordinary gain or loss items as illustrated in the “Explanatory Announcement No.1 for Public Company Information Disclosures – Extraordinary Gains or Losses” which has been defined as its recurring gain or loss items. □Applicable √N/A X Others □Applicable √N/A Chapter 3 Management Discussion and Analysis I Description of the industry in which the Company operates and principal businesses of the Company during the Reporting Period (I) Principal businesses and products of the Company The Company is primarily engaged in the R&D, production and sales of pharmaceutical products and health care products. The business scope of the Company covers chemical pharmaceuticals, biologics, chemical active pharmaceutical ingredients (APIs) and intermediates, traditional Chinese medicine (TCM), diagnostic reagents and equipment, health care products, etc. The enriched product series and mix provide larger market and growth opportunities for the Company. Main products of the Company are as follows: (II) Business model of the Company With the stable operation and rapid development over the years, the Company has become an integrated pharmaceutical group that is driven by scientific research and innovation, integrating the R&D, production, sale and service of pharmaceutical and health care products. It has complete systems of R&D, procurement, production and sale. Main business models of the Company are as follows: 1. R&D Taking independent R&D as the mainstay and combining external introduction and cooperative development, the Company has been paying attention to the cutting-edge technology and unmet clinical needs, with efforts focused on innovative drugs and high-barrier complex formulations, and has established an efficient R&D innovation management model. In terms of independent innovation, the Company has a diversified and multi-dimensional R&D organization with mature R&D teams for chemical pharmaceuticals, biologics, TCM drugs, APIs, diagnostic reagents and health care products. Based on technology platform construction, the Company has built a clear product R&D pipeline centering on key areas such as respiratory, tumor immunity and psychiatry. In terms of cooperative innovation, the Company has launched technical cooperation with domestic and foreign scientific research institutions by way of commissioned development or cooperative development, and has introduced new technologies and products that meet the strategic development goal of the Company through technology transfer or license-in to implement industrial transformation, so as to reinforce and strengthen our position and strategy in the leading and emerging fields. 2. Procurement In terms of procurement, the Company pays strict attention to effectiveness, quality and cost of procurement and has established long-term and stable partnership with many suppliers. Active pharmaceutical ingredients, supplementary materials, and packaging materials were purchased and stocked up by manufacturers according to production schedules. The Company has developed strict quality standards and procurement management systems, and required subordinate manufacturers to make procurements in accordance with the GMP. Meanwhile, the Company established long-term strategic partnerships with bulk material suppliers, and strengthened the management of supply quality and cost control based on strict quality standards. The Company has established an internal evaluation system and files of market prices so as to promptly acquire market information for procurement through comparisons of quality and price. 3. Production In terms of production, the Company adopts the principle of market demand-oriented approach paying attention to real market demand. Specifically, the Sales Department of the Company investigated market demands, made sales plans, and comprehensively considered factors such as the product inventory quantity and capacity of production lines of the Company so as to determine the monthly production quantities and specifications. Moreover, the purchase orders of raw materials are determined according to the production schedule and the inventory levels of raw materials. The final production plans are issued upon approval of the management of the Company and implemented by the Production and Technology Departments of the Company. The Company has been carrying out production in strict accordance with the GMP. The Company and its affiliates have established a sound quality management system and implemented the qualified-person system. In terms of quality control, the Company has established a strict and sound production quality assurance system, and is geared to international standards and subject to international certification while in compliance with national standards. The Company conducts annual GMP self-inspection, ISO9001 internal and external audits, and is subject to various external audits. It actively pursued the internationally advanced GMP management, and implemented whole-process quality control over supplier selection, audit, incoming material inspection, production process, product release from factory, and market tracking. The system is running well. 4. Sales (1) Drug formulation products End customers of drug formulation products (chemical pharmaceuticals, biologics, traditional Chinese medicine) of the Company are mainly hospitals, clinics, and retail pharmacies. In line with the pharmaceutical industry practice and the sales model of most peers in the industry, the Company has conducted sales of drug formulation products through drug distribution enterprises. The Company carried out selection and centralized management of qualified drug distribution enterprises (with Drug Supply Certificate, GSP Certification, etc.) according to their distribution capability, market familiarity, financial strength, credit record, and operation scale. General sales process: After end customers place purchase orders to distribution enterprises, drug distribution enterprises will send those orders to the Company according to their inventories, distribution agreements and conditions; then, the Group will deliver products to drug distribution enterprises and do the revenue recognition. (2) APIs and intermediates Main target customers of APIs are large pharmaceutical manufacturers. The selling prices are determined based on a set of integrated factors such as costs of production, inventory levels, industry rivalry and market trend. Specific pricing method: The sales and marketing department conduct weekly or bi-weekly meetings to analyze the current market conditions, the trends and drivers of prices. The selling prices are determined based on a set of comprehensive factors such as costs of production, inventory levels, industry rivalry and market conditions. The selling prices will be effective once they are reported by the managers of the sales department to our management team and get approvals. Specific sales methods of APIs include: ① Domestic market: The Company directly signs product sales contracts with large manufacturers to directly sell products to customers. Meanwhile, the Company also sells products through distributors. ② Foreign market: The Company directly sells products in the foreign market, and products are sold through distributors in areas with high market and political risks; At present, products of the Company are mainly exported to over 60 countries and regions in Asia, Europe, North America, and Africa. (3) Diagnostic reagents and equipment Diagnostic reagents and equipment are sold by the Company both domestically manufactured and imported. Main end customers are hospitals, centers for disease control and prevention, and health departments. The Company mainly sells those products in combination with direct sales and sales through drug distribution enterprises. The Company has an experienced sales team responsible for the sales of diagnostic reagents and equipment, with provision of marketing support for some drug distribution enterprises. The Company carried out selection and centralized management of qualified drug distribution enterprises (with Drug Supply Certificate, GSP Certification, etc.) according to their distribution capability, market familiarity, financial strength, credit record, and operation scale. (4) Health care products The sales model of health care products is mainly distributor management model. Product promotion, price control, and channel carding are managed and improved with the distributor distribution channels and terminal coverage capability. At present, the Company has set up 27 provincial branches and 37 subordinate offices across China and maintained long-term partnership with distributors with better area coverage capability for stable strategic alliance and common development. The Company has cooperated with about 103 first-level/primary distributors in total, including 1,260 businesses in drug distribution line and approximately 29 businesses in food distribution line, with more than 450,000 subordinate secondary businesses and terminal businesses in drug and food distribution lines. Products are well managed and promoted through the tiered marketing channels. In addition to the traditional distribution management model, the Company realizes synergetic development through online channels. At present, the Company has set up official flagship stores on mainstream e-commerce platforms such as Tmall （天猫）, Jingdong（京东）, Douyin（抖音）, Kuaishou （快手） and Pinduoduo（拼多多）. (III) Analysis of industry development The pharmaceutical industry is a national strategic emerging industry bearing on the national economy and people's livelihood, and an important part of the national economy. According to the “14th Five- Year Plan for the Development of Pharmaceutical Industry”(《“十四五”医药工业发展规划》), the overall development of the pharmaceutical industry will reach a new level. During the "13th Five-Year Plan" period, the average annual growth rate of the added value of pharmaceutical industry above designated scale was 9.5%, 4.2 percentage points higher than the overall industrial growth rate, and the proportion of the total added value of the pharmaceutical industry to that of all industries increased from 3.0% to 3.9%; the average annual growth rates of the operating revenues and total profit of enterprises above designated scale were 9.9% and 13.8%, respectively, being at the forefront of various industries in terms of growth rates. At the same time, the scale of leading pharmaceutical manufacturers has further expanded with the steadily increasing industry concentration. In the first half of 2023, with the deepening reform of the national medical and healthcare system and increasing improvement in the innovation environment, the pharmaceutical industry continued to advance towards high-quality development featuring transformation, upgrading and encouraging innovation. As China's population ages and urbanization rates continue to rise, from the long-term and holistic perspective, China's pharmaceutical industry will continue on a promising trajectory. According to data from the National Bureau of Statistics, in the first half of 2023, enterprises in the pharmaceutical manufacturing industry above designated scale in China have realized revenues of RMB1,249.6 billion, representing a year-on-year decrease of 2.9%; operating costs were RMB713.01 billion, representing a year-on-year decrease of 1.8%; total profits reached RMB179.45 billion, representing a year-on-year decrease of 17.1%. (IV) Industry status of the Company Through years of development, the Company has become an integrated pharmaceutical enterprise covering multiple sectors including chemical pharmaceuticals, chemical APIs and intermediates, traditional Chinese medicine, diagnostic reagents and equipment as well as health care products. chemical pharmaceuticals are the largest revenue generator of the Company, among which drugs for gastroenterology and gonadotropic hormones are traditional competitive products of the Company, with key products securing a long-term leading position in national pharmaceutical formulation market segment, and respiratory and psychiatry products have been the strategic focus of the Company, with key products maintaining a strong sales growth momentum. During the Reporting Period, the Company, leveraging its robust R&D and production capabilities and steady marketing presence, the Company ranked Top 10 in “2022 Annual Ranking of Top 100 Chinese Chemical Drug Enterprises”. (V) Performance drivers in the Reporting Period In the first half of 2023, amid the macro environment of weak recovery of domestic economy and tightening of industry regulation and access policy, the growth rate in the Company's performance slowed down due to factors such as a decrease in the volume-based procurement price of its key product Meropenem for injection and intensified competition in the APIs market. During the reporting period, the Company steadfastly the dual-driver strategy of "innovative drugs + high-barrier complex formulations", focusing on unmet clinical needs to accelerate its transformation into an innovative pharmaceutical company. While strengthening its independent R&D capabilities, the Company had introduced multiple new medicine projects through external acquisitions and co-development, comprehensively expanding the layout of its R&D pipeline. This strategic approach continuously reinforces the company's leading position in areas such as respiratory and gastroenterology. II Analysis of core competitive strengths during the Reporting Period 1. PRC’s leading integrated pharmaceutical company under continuous innovation and development The Company is primarily engaged in the R&D, production and sale of pharmaceutical products and health care products. The business scope of the Company covers chemical pharmaceuticals, chemical APIs and intermediates, traditional Chinese medicine, diagnostic reagents and equipment, as well as health care products, enabling the Company to establish an advantageous market position cross various therapeutic fields such as respiratory, anti-infection, assisted reproduction, gastroenterology, psychiatry, and tumor immunity. 1) Innovative R&D drives growth: The Company has developed and launched a number of blockbuster products and high-barrier complex formulation products, strengthening the Group’s product portfolio and drug candidates in the pipeline. 2) The Company has first-rate commercialization ability, and its sales network covers all provinces in China and over 80 countries and regions in the world. The Company emphasizes scientific promotion and evidence-based marketing. By building a professional marketing team, a fine marketing development system has been formed, and market education and brand building have been deeply strengthened through digital marketing. With such efforts, a diversified marketing system has been established. Leveraging our well-established sales channels, broad end-user coverage, leading digital marketing and strong brand awareness, the Company efficiently realizes large-scale sales post-product approval. 3) Cross-industry and multi-specialist innovative R&D and coordinated development: On the one hand, the Company actively adapts to the changes in the pharmaceutical market and constantly adjusts its product strategy and R&D direction according to policies and clinical needs, achieving the ongoing iteration and upgrade of main products; On the other hand, the Company fully utilizes external scientific research and commercial resources, such as strategic collaboration with Chinese Academy of Sciences, Tencent Quantum Lab and other scientific research institutes and innovative companies, and invests in cutting-edge biotechnology companies to expand the Company's product matrix and R&D pipeline, ultimately achieving the Company's sustainable development. 2. Strong R&D capability, diversified product matrix and leading commercialization capabilities Focusing on innovative drugs and high-barrier complex formulations, the Company has formed diversified product matrix. With the huge clinical demand and high product quality, it has established market competitive advantages in many pharmaceutical segments. The Company's chemical pharmaceuticals cover gastroenterology diseases, assisted reproduction, infectious diseases, respiratory diseases, psychiatric and neurological diseases, tumor and other disease treatment fields, among which alimentary canal proton pump inhibitor (PPI) drugs, gonadotropic hormones drugs, and inhalation formulations for respiratory system diseases have an advantageous market position. Relying on APIs, the Company’s core products, together with chemical APIs and intermediates, form a stable pharmaceutical industry chain of “APIs-formulations vertical integration”. Meanwhile, the Company actively develops overseas markets, and its products are marketed and distributed worldwide, facilitating strategic cooperation with many internationally renowned pharmaceutical companies. In addition, the Company also has a number of traditional Chinese medicine and in vitro diagnostic reagent products, and has accumulated resources and wide brand influence in health care products for many years. 3. Making breakthroughs in the key R&D and industrialization technologies of complex formulations The technology platform, which has been developed over the years in the field of innovative drugs and high-barrier complex formulations, enables the Company to address the complex process problems in the R&D and production of relevant drugs. Guided by clinical value, the Company develops R&D projects with high short-term certainty and cutting-edge technologies with long-term growth potential (such as AI-driven drug molecular design, proteolysis targeted chimera (PROTAC), synthetic biology, gene editing and cell therapy). All in all, the Company's R&D system covers through-cycle of drug development and production. Based on the mature R&D platform of innovative drugs and high-barrier complex formulations, the Company has designed a rich pipeline in fields with significant clinical demand such as respiratory, gastroenterology, assisted reproduction, psychiatry and tumor. 4. A stable senior management and R&D team with expertise, long-term vision and commitment to corporate social responsibility The Company has a stable, visionary and experienced, results-oriented management team and an outstanding talent team. Outstanding leaders are the key to the Company's rapid development. The founder of the Company has over 30 years of expertise in the pharmaceutical industry as well as a global vision and a strategic mindset. With a deep industry insight, the founder has led us developing platform technologies centered on high-barrier complex formulation, which has established leading position of the Group with sustainable development in the broader healthcare industry The senior management team of the Company has over 20 years of industry experience on average, with an average of more than 10 years of service in the Company, and has a thorough understanding of market demand, industry development and growth opportunities. Each key R&D field of the Company is led by industry-leading scientists and accompanied by an efficient R&D management team. In addition, the Company has upheld the core value of “Putting People First, Valuing Workmanship and Quality, Pursuing Innovation and Truth, Promoting Cooperation and Sharing” and laid emphasis on talent team training to build a diversified talents pool with global vision, advanced knowledge, strong execution capability and sense of ownership. Driven by the corporate culture of pursuing excellence, the talent team works diligently and conscientiously to jointly contribute to the sustainable development of the enterprise through teamwork and collaboration. III Discussion and analysis of business conditions 1. Main business conditions during the Reporting Period During the Reporting Period, the Company realized revenues of RMB8,720 million, representing a year- on-year increase of approximately 1.81%; a net profit attributable to shareholders of the listed company of RMB815 million, representing a year-on-year increase of approximately 1.77%, and a net profit attributable to shareholders of the listed company after deducting the extraordinary gains or loss of RMB782 million, representing a year-on-year decrease of approximately 2.77%. Business development of various segments of the Company is as follows: (1) Livzon Group (excluding Livzon MAB) As at the End of the Reporting Period, the Company directly and indirectly held 44.77% equity interest in Livzon Group (000513.SZ, 01513.HK). During the Reporting Period, Livzon Group (excluding Livzon MAB) realized revenues of RMB6,678 million, representing a year-on-year increase of approximately 6.08%; and thus it contributed a net profit of approximately RMB607 million attributable to shareholders of the Company. During the Reporting Period, the sales of the chemical pharmaceuticals segment of Livzon Group maintained stable growth, and recorded the stable growth in the proportion and profitability of high-end specialty APIs in the API segment. The sales of its products in the key therapeutic areas are as follows: Gastroenterology products realized revenues of RMB1,625 million, representing a year-on-year decrease of approximately 7.75%; gonadotropic hormones products realized revenues of RMB1,376 million, representing a year-on-year increase of approximately 2.71%; and psychiatry products realized revenues of RMB278 million, representing a year-on-year increase of approximately 5.31%. (2) Livzon MAB As at the end of the Reporting Period, the Company held 55.90% equity interest in Livzon MAB, which contributed the amount of approximately RMB-241 million to the Company's net profit attributable to shareholders of the listed company for the current period. Livzon MAB continued to focus on new molecules, new targets and differentiated molecular designs in the fields such as autoimmune diseases, vaccines, oncology and assisted reproduction to consistently push forward the R&D of key projects. During the Reporting Period, the progress in R&D of biological （未完）  |