Opened up 352.51%, peptide drug R&D company Shengnuo Biotechnology listed on the Science and Technology Innovation Board today

On June 3, 2021, peptide drug developer Shengnuo Biotechnologys landed on the Science and Technology Innovation Board. The issue price of Shengnuo Biotechnologylogical is 17.9 yuan, and 20 million RMB ordinary shares will be publicly issued. The opening this morning rose sharply to 81 yuan, an increase of 352.51%.

Source of picture: Shengnuo Biotechnology Finance’s listing on the Science and Technology Innovation Board this time, Shengnuo Biotechnology has raised funds for three major investments: the 395kg/year peptide API production line project, the preparation industrialization technology transformation project, and the engineering technology center upgrade project.

Shengnuo Biotech’s fund-raising investment direction (source: company prospectus) Chengdu Shengnuo Biotechnology Co., Ltd. (hereinafter referred to as “Shenuo Bio”) was established in July 2001 and is located in Dayi County, Chengdu.

It is an earlier establishment in China One of the professional peptide drug manufacturers. The company has core peptide synthesis and modification technologies, advanced and efficient peptide drug technology research and development and large-scale production capabilities.

It is mainly engaged in the research and development, production and sales of peptide raw materials and preparation products, and provides enterprises with innovative peptide drug pharmaceutical research , Customized production of peptide products and other services, is one of the few enterprises in this field that has a full industrial chain layout for the development, production and sales of peptide APIs and preparations.

According to the prospectus, the process research and development and production capabilities of peptide drugs are the main competitive advantage and business development foundation of Shengnuo Biotechnology.

At present, the company has mastered the large-scale production technology of 15 peptide APIs, of which 7 products have obtained domestic production approvals, 8 products have obtained the US DMF registration (active status), and the 8 extended peptide preparations are in the country.

It has obtained 12 production approvals, and its products cover areas where peptide drugs play an important role in immunity, digestive tract, antiviral, obstetrics and gynecology, diabetes, cardiovascular and cerebrovascular, rare diseases, orthopedics, etc.

Enfuvirtide and carbetocin injections for injection of the company’s peptide preparation products are the first imitation peptide drugs in China; bivalrudine, liraglutide, thymosin, icatibant, enfuvirtide, etc. The generic APIs that are difficult to synthesize have been exported to international markets such as Europe, America, India, and South Korea. The end customers include Fresenius, Aurobindo, Mylan, Lupin, Xinlitai, Shanghai Pharmaceutical First Biochemical, Yangzijiang and other well-known domestic and foreign pharmaceutical companies.

Peptide drugs have the characteristics of both small molecule chemical drugs and protein drugs

Peptide is a compound formed by linking multiple amino acids together by peptide bonds. It is connected in the same way as a protein. Usually, a molecule containing less than 100 amino acids is called a polypeptide, and those with more than 100 amino acids are called peptides. Called protein.

Polypeptide drugs are a new class of drugs whose specific application in the field of medicine is a new class of drugs whose molecular size is between small molecule drugs (MW10000) and has some of the characteristics of both.

Compared with protein drugs such as monoclonal antibody drugs and recombinant protein drugs, peptide drugs have the advantages of simpler spatial structure, higher stability, lower immunogenicity or no immunogenicity, etc., and also have strong specificity and curative effect of protein drugs. Good features: Compared with small molecule drugs, peptide drugs have advantages in biological activity, specificity and solving complex diseases. At the same time, the production and preparation methods of peptide drugs have the same points as small molecule drugs, with controllable quality and structure. It is easy to verify and low cost.

The quality control level of peptide drugs is close to that of small molecule chemical drugs, and the activity is close to that of protein drugs.

Combining the advantages of both, it has its own advantages in clinical application and production and preparation, and is suitable for solving the difficulties of small molecule chemical drugs. Solved complex diseases, including metabolic diseases, tumors, etc.

Although the research and development process is similar to traditional small molecule drugs, peptide drugs have unique differences in process design, preparation methods, structural confirmation, quality research, R&D and production equipment, etc., especially from laboratory gram-scale preparation to several kilograms in the commercial stage High-level production capacity is difficult, so large-scale production has become the key to the commercialization of peptide drugs. At present, chemical synthesis is the main way for the large-scale production of peptide drugs.

Shengnuo Biotechnology uses chemical synthesis to develop and produce peptide drugs.

Its main business relies on peptide synthesis and modification technology-based peptide large-scale process R&D and production capabilities. Its products and services cover peptide drugs from the drug screening stage, The complete life cycle from pre-clinical research stage, clinical research stage to commercialization stage. The links of the company’s main products and services are shown in the figure:

(Image source: Shengnuo Biotech Prospectus) Product marketing expenses account for a relatively large amount. Increasing R&D investment in the future is the key to maintaining long-term product competitiveness

According to the prospectus, Shengnuo Bio’s operating income mainly comes from the pharmaceutical research and customized production services of peptide drugs, peptide raw materials, peptide preparation products, and levosimendan preparations and the production and sales of raw materials.

Shengnuo Bio’s financial data (source: company prospectus) From 2018 to 2020, Shengnuo’s operating income will be 278 million yuan, 327 million yuan, and 379 million yuan, respectively, with a year-on-year increase of 17.54% and 15.92% respectively from 2019 to 2020. ; Sales expenses were 114 million yuan, 167 million yuan, and 182 million yuan, respectively.

The year-on-year growth of 45.87% and 9.05% from 2019 to 2020 was respectively. The three-year sales expenses accounted for 41.12%, 51.03% and 48.01 of operating income in the same period. %.

Among them, the promotion fee of preparation business, one of the main business of Shengnuo Biotechnologyal, accounts for more than 84% of operating income. The revenue of this business contributes to the company’s gross profit of 8.371 million yuan, 15.74119 million yuan, and 17.6812 million yuan respectively. Shengnuo Biotechnologytech disclosed in the prospectus that the company’s product promotion expenses accounted for more than 95% of its sales expenses.

Regarding whether there is a problem of high marketing expenses and low R&D investment in Shengnuo Biotechnology, it has been widely discussed in major media when the company submitted its prospectus. Many media have said that Shengnuo Biotechnology is “focusing on marketing and despising on R&D.”

In fact, compared with listed companies in the same industry, during the reporting period, Shengnuo Biotech’s sales expenses accounted for higher than the industry average, but not the highest in the industry. In addition, Shengnuo Biotechnologytech stated in its prospectus that its target industry companies such as Gloriain, Proton Co., Ltd., and Kanglong Chemical are mainly engaged in customized R&D and production services, and do not involve the sales of domestic preparations, and there is no market promotion fee. The sales expense ratio is low.

In the company’s description of the use of raised funds, it also partially explained the problem of excessively high marketing costs for preparations.

Shengnuo Biotechnologytech stated that because the company is a latecomer in the domestic peptide preparation market, the preparation products are under greater competition pressure. The company has not yet established its own marketing team and needs to rely on professional market promoters for market promotion. Therefore, the company’s preparation product market promotion costs The burden is heavier.

Therefore, we can guess that the company is to occupy a certain market share while developing products to maintain the market competitiveness of the products. However, due to the lack of its own marketing team, the financial performance of the product promotion expenses is not very good. . However, even if we only analyze the performance of Shengnuo Biotechnologytech’s R&D investment, the company still has a lot of room for improvement.

Shengnuo Biotechnology’s financial data (source: company prospectus) Through the prospectus data, we can find that from 2018 to 2020, Shengnuo Biotechnology’s research and development expenses accounted for 5.64%, 3.55%, and 5.94% of the year’s revenue, respectively.

According to calculations, the company’s three-year cumulative R&D investment accounted for 5.06% of the company’s cumulative operating income in the last three years, which just stepped on the “Science Innovation Attribute Evaluation Guidelines (Trial)” “The cumulative R&D investment in the last three years accounted for the last three years’ cumulative operating income 5% or more” on the passing line. As a technology research and development company, if you want to continue to ensure its competitiveness in the future development, it may be a better choice for Shengnuo Biotechnology to focus on product research and development.

The R&D team has rich theoretical and practical experience, advanced and complete laboratory construction, and relatively complete product line construction

There are a total of 5 core technicians in Shengnuo Biotechnology, all of whom have more than 15 years of research and practical experience in the field of peptide synthesis. The team members have won the title of the top innovation and entrepreneurship team for the introduction of high-level talents from Sichuan Province.

Wen Yongjun, Chairman & Chief Scientist of Shengnuo Biotechnology, is one of the earliest experts in the field of peptide drugs in China. He once presided over the development of the first peptide drug thymopentin approved by the state and obtained a new drug certificate, and presided over the completion of the thymus method.

The new domestic first imitation, successively won the “Outstanding Contribution Award for Peptide Application” at the 10th and 12th International Peptide Conference, and the “Outstanding Talent Award” at the 2nd National Peptide Drug R&D and Large-scale Production Frontier Technology Exchange Conference, 2018 Selected as the Leading Talent Project of Sichuan Province Tianfu Entrepreneurship.

In terms of plant construction, the R&D Center of Shengnuo Biotechnologytech has a 2,150㎡ R&D laboratory for new peptide drugs, peptide raw materials and related peptide products that meets the management standards of pharmaceutical laboratories.

It also has a large number of advanced R&D equipment, including from the United States, Switzerland, and Japan. The fully automatic CS936 series peptide synthesizer, Agilent LC/MS, Waters ultra-high performance liquid chromatograph, PE polarimeter, and dynamic axial compression column system (DAC) of various specifications and other international advanced Professional setting.

At present, Shengnuo Biotechnology has formed a coordinated R&D mechanism including information collection, feasibility analysis, project establishment, R&D process management, etc., which can ensure that new products are smoothly and efficiently completed from project establishment, process quality research, and small-scale trials. , Pilot, large-scale production and product registration and other operations in the R&D process to ensure the rapid progress of product declaration and listing.

Shengnuo Biotechnology’s main product line covers multiple therapeutic areas such as digestive system, immune system diseases, anti-tumor, chronic hepatitis B, diabetes and obstetrics, and is one of the domestic peptide drug manufacturers with a relatively complete product line.

In foreign markets, the company has 8 products of bivalrudine, eptifibatide, icatibant, liraglutide, octreotide acetate, ziconotide, teriparatide, and ganirelix. DMF filing (active). In the domestic market, the company has obtained 19 domestic drug registration approval numbers or domestic filings for peptide drugs, including 8 peptide APIs and 12 peptide preparation specifications. They are two domestic preparations of enfuvirtide and carbetocin. The first imitation enterprise of the product.

Currently, Shengnuo Biotechnology is applying for registration approval for 11 products, and more than ten peptide drug products are in the research and development stage. The company disclosed in the prospectus that it will further expand and enrich its product line in the future.

Master the large-scale production technology of dozens of peptide APIs, and the products have been exported to many countries and regions

Through independent research and development, Shengnuo Biotechnology has mastered the long-chain peptide coupling technology, the large-scale production technology of monosulfide cyclic peptides, the synthesis technology of multiple pairs of disulfide cyclic peptides, the fragment condensation technology, the PEGylation modification technology, the fatty acid modification technology, etc.

The independent core technology of peptide synthesis and modification has successfully solved the technical bottleneck of the large-scale production of peptide APIs including Enfuvirtide, Liraglutide, Teriparatide, Exenatide, etc. Many pairs of disulfide bonds and cyclic peptides in the structure of conotide, linaclotide and other varieties cause technical problems with excessive impurities.

At present, the company’s peptide API products have been exported to many countries and regions including Europe, America, South Korea, and India. Among them, the bivalrudin API supporting customer Fresenius’ product became the second generic drug approved for this product in the U.S. market.

This preparation product achieved a sales volume of $53,155,000 in the U.S. in 2018, and its market share reached 21.71%; Enfuvirtide and thymus method new APIs respectively support customers’ generic drugs to be launched in Mexico and South Korea; icatibant and ziconotide are the first to complete the DMF application of generic APIs to the U.S. FDA; liraglutide, etc. Eight varieties support the research and development of customer preparations and prepare them for marketing in the United States and Europe.

So far, Shengnuo Biotechnology has established business relationships with well-known multinational pharmaceutical companies including Fresenius, Aurobindo, Mylan, and Lupin.

As a result of the accumulated rich R&D experience in the field of peptide APIs, Shengnuo Biotechnology also launched the pharmaceutical research service of peptide innovative drugs and customized production service business of peptide products.

According to its prospectus, Shengnuo Biotechnology has provided pharmaceutical research services for more than 30 Class I peptide innovative drug projects, of which one product has been approved for marketing, and seven drugs have entered the clinical trial stage. It serves new drug research and development customers including hundreds of Well-known innovative drug R&D companies and scientific research institutions such as Aotai Biotech, Suzhou Paige Biotech, and Eight Plus One.

The peptide drug market in my country started late but is growing rapidly, and the future market space is broad

Although my country’s peptide drug market started late, it has developed rapidly. Sales rose from 5.6 billion yuan in 2009 to 29.56 billion yuan in 2017, with an average compound annual growth rate of 23.12%, which is much higher than the overall growth of the global peptide drug market. speed.

According to QYResearch statistics: the global peptide drug market scale was approximately US$15.2 billion in 2010 and reached US$28.5 billion in 2018, with a compound annual growth rate of 8.17%, compared to the global pharmaceutical market of approximately US$1.3 trillion in 2018 , The market size of peptide drugs accounted for only 2.19%, and the growth rate of the market size of peptide drugs was approximately twice that of the overall growth rate of the global drug market.

The peptide drug market is expected to grow at a compound annual growth rate of 7.9% in the future, and the market size will reach US$49.5 billion in 2027.

At present, dozens of peptide drugs in the global market have shown great clinical application value and broad application prospects. Many peptide drugs have become varieties exceeding hundreds of millions of dollars in just one or two years after being marketed. In 2016, there were 6 peptide drugs with annual sales of more than US$1 billion in the world, such as Teva Pharmaceuticals (TEVA) glatiramer, which accounted for 20% of the multiple sclerosis market and global sales of approximately US$4.2 billion; NovoNordisk’s liraglutide, used to treat type II diabetes, has sales of more than 2.8 billion U.S. dollars…

According to data from Evaluatepharma and PDB, a medical research institution, the market size of orphan diseases/rare diseases, tumors, and diabetes in peptide drugs are all over US$3 billion, while the remaining four fields are the digestive tract, orthopedics, immunity, and cardiovascular and cerebrovascular markets. The scale is relatively small, but there are also some heavy varieties.

In the future, there are greater opportunities in the new varieties of peptide preparations in my country. At present, nearly half of the peptide drug molecules on the global market have not yet been listed in China. The utilization rate of the top ten peptide molecule products in the global sales is still relatively low in China. Peptide drugs will be used in the domestic market in tumor and diabetes in the future. Contains a vast market space and has great potential for development.