Peptide whole industry chain advantage is outstanding Shengnuo Bio’s new project will quickly relieve the capacity bottleneck Podcast Article

At present, dozens of peptide drugs in the global market have shown great application value and wide application prospect with exact efficacy in the clinical field, and many peptide drugs have become varieties with annual over hundreds of millions of dollars in just one or two years after listing, and there are 6 peptide drugs with annual sales over 1 billion dollars in 2016. And in recent years, with the continuous progress of industry technology, peptide drugs have also shown explosive growth.

In this field, Shengnuo Biological (688117,SH), a professional peptide drug manufacturer established earlier in China, relies on twenty years of deep cultivation in the industry and quickly stands out, gradually developing into one of the few first-line enterprises in the domestic peptide drug field with the layout of the whole industry chain of peptide API and preparation R&D, production and sales, and successfully ranking as the most powerful peptide drug synthesis and production technology platform in China. It is also one of the most competitive enterprises in the peptide generic drug industry chain in the global regulated market.

In June this year, Shengnuo Bio successfully went public and started a new development journey. As for the future overall plan, Shengnuo Bio said that it will seize the development opportunity of high growth of peptide generics market, continue to cultivate the peptide market, continuously improve the process technology, R&D strength, marketing management, channel construction and comprehensive management ability, and improve the overall competitiveness and profitability. At the same time, we will grasp the development trend of global pharmaceutical industry, take peptide API products as the grip, continuously improve the level of peptide innovative pharmacological research services and peptide products custom production services, and actively integrate into the domestic and international pharmaceutical industry chain. Moreover, we will extend the development of more peptide preparations and further increase the promotion of preparations and promotion management level. In addition, the company will also actively layout the peptide innovative drug business field through cooperative research and development, and continue to consolidate the company’s competitive position in the industry.

Peptide drug research and development strength forges core competitiveness

Outstanding product reserve and pipeline advantage

As a high-tech enterprise with the core technology of peptide synthesis and modification, since its establishment, Shengnuo Bio has been engaged in the R&D of peptide drug scale production technology, and its R&D strength has been growing continuously. The core technology team has been successfully awarded the title of top innovation and entrepreneurial team introduced by high-level talents in Sichuan Province.

It is worth mentioning that Mr. Wen Yongjun, the chief scientist and chairman of the company, is one of the earliest experts in the field of peptide drugs in China, and has presided over the development of thymopentapeptide, the first peptide drug approved by the state and obtained the new drug certificate in China, and presided over the completion of the first domestic generic of thymefaxine. Based on the continuous support of the industry’s highly skilled professionals, Shengnuo Bio has gradually developed and mastered a number of core technologies of peptide synthesis and modification such as long chain peptide coupling technology, single thiocyclic peptide scale production technology, multiple pairs of dithiocyclic peptide synthesis technology, fragment condensation technology, polyethylene glycolization modification technology, fatty acid modification technology, etc., and solved the technical bottleneck of scale production of several peptide API varieties.

By the end of the first half year, Shengnuo Biologicals has owned 43 authorized patents, including 32 invention patents, 9 utility model patents and 2 international PTCs, in addition, it also owns a large number of non-patent technologies. In addition, it also has a large number of non-patent technologies and outstanding R&D strength. It is reported that Sano Bio will also introduce a series of industry advanced R&D hardware and software with the fund-raising project to further improve the level of peptide drug R&D, and at the same time attract more high-end talents to further improve R&D efficiency and increase technology accumulation.

Based on the strong R&D strength, the main product line of Shengnuo Bio has successfully covered many therapeutic areas such as digestive system, immune system diseases, anti-tumor, chronic hepatitis B, diabetes and obstetrics, and has become one of the more complete peptide drug manufacturers in China. In the foreign market, Shengnuo Bio has 8 products, including bivalirudin, etiparatide, etibant, liraglutide, octreotide acetate, ziconotide, teriparatide and ganirelix, which have obtained the US DMF filing and are in activation status. In the domestic market, Shengnuo Bio has also obtained 19 domestic drug registration approval numbers or domestic filings for peptide drugs, including 8 peptide APIs and 12 peptide formulation specifications, and is the first generic company for two domestic formulation products, enfuvirtide and cabergoline.

At present, there are 10 products for which Shengnuo Bio is applying for registration approvals, and more than 10 peptide drug products are in R&D stage. It can be seen that the company has a rich product line and is still in the process of expansion. In this regard, Shengnuo Bio said that it will arrange the R&D and registration plan of relevant peptide APIs and preparations according to the expiration of patent drugs, accelerate the acquisition of drug registration numbers, and strive to register 2-3 new APIs and preparations at home and abroad every year, so as to strengthen the advantages of the company’s product line.

In addition, it is understood that, with the advantages of the whole process R&D pipeline and the whole industry chain platform of peptide API and formulation, Shengnuo Bio has successfully obtained a large number of business opportunities of pharmacological research services for peptide innovative drugs and custom production services for peptide products. We can play an important role in the R&D and industrialization transformation of peptide innovative drugs in China.

The completion of CDMO service production base will ease the bottleneck of production capacity

The fund-raising project will help the company’s performance to increase multifold

The prospectus shows that from 2018 to 2020, Shengnuo Bio’s revenue will be RMB 278 million, RMB 327 million and RMB 379 million, and net profit will be RMB 29,861,300, RMB 48,131,700 and RMB 59,997,800 respectively, with a steady increase in revenue and net profit. According to the latest financial report, in the first half of the year, Shengnuo Bio revenue achieved 194 million yuan, an increase of 10.2% year-on-year, and net profit attributable to the mother company achieved 24.01 million yuan, a decline year-on-year. In this regard, Shengnuo Bio said that the main reason is that the orders for CDMO services in 2020 gradually entered the review stage, which required the company’s API GMP production workshop to produce GMP-compliant APIs to meet the review requirements of customers, resulting in limited API production arrangements from January to June 2021, resulting in insufficient production capacity, and orders could not be delivered on time.

In order to solve the capacity problem at the fastest speed, the CDMO service production base invested by Shengnuo Bio through its own capital is expected to be put into operation in the third quarter, which will then effectively alleviate the current problem of insufficient API production capacity of the Company.

In addition, in the long term, 2014 to 2022 is the peak period of patent expiration of global new peptide drugs, and the next few years are both the golden period for the development of peptide innovative drugs and the important stage of explosive growth of peptide generics. And it is reported that the capacity utilization rate of some varieties of API-specific production lines of Shengnuo Bio has increased from 95.99% in 2017 to 100.77% in 2019, with an obvious capacity bottleneck. For this reason, Shengnuo Bio took the opportunity of listing to raise funds to invest in several projects, among which the peptide API production line project and the preparation industrialization technical transformation project will both further expand the company’s production capacity and achieve sufficient market supply. After the two projects reach production, it is expected that the company can generate revenue totaling 475 million yuan/year and profit totaling 86,804,600 yuan/year, which means that the company’s performance will also be expected to achieve multi-fold increase with the landing of the investment projects.

According to QYResearch statistics, the global peptide drug market scale was about 15.2 billion dollars in 2010, and reached 28.5 billion dollars in 2018, with a compound annual growth rate of 8.17%, compared with the global pharmaceutical market scale of about 1.3 trillion dollars in 2018, the peptide drug market scale accounted for only 2.19%, and the growth rate of peptide drug market scale is about The growth rate of peptide drug market size is about 2 times of the overall growth rate of global drug market size. This indicates that the peptide drug market still has huge growth space, which undoubtedly provides a broad prospect for the future growth of Shengnuo Bio.

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