In recent years, with the normalization of nucleic acid detection, the demand for nucleic acid detection has expanded rapidly. In April this year, Li, deputy director of the Laboratory Department of the National Health Commission, said: "Since the new epidemic, China has completed about11500 million person-times of nucleic acid testing."
At present, many cities in China have put forward 15-minute nucleic acid "sampling circle" to provide convenience for citizens to "exhaust all resources" and "hope to exhaust all resources". Under the policy, nucleic acid testing has become just needed, and the market represented by nucleic acid testing services will expand. Enterprises have sprung up like mushrooms after rain. On May 3, 2022, Guo Yanhong, inspector of the Medical Administration and Hospital Authority of the National Health and Family Planning Commission, said at the press conference of the joint prevention and control mechanism of the State Council Office that there are 1.3 10000 medical and health institutions in China that can carry out nucleic acid detection, and there are 153000 professional technicians engaged in nucleic acid detection technology, with a nucleic acid detection capacity of 5700 per day. According to relevant software statistics, there are 104 listed companies involved in the generalized COVID-19 testing business, and there are about 20 core companies. Combining large-scale screening with routine detection, the market size of nucleic acid detection given by different research institutions is around 1000 billion, and the detection industry in COVID-19 has ushered in a blowout development period.
In this issue, we will share it from the perspectives of the global COVID-19 epidemic, the industrial chain of nucleic acid testing in COVID-19, the core list of A-share companies for nucleic acid testing (26 companies), and data analysis and prediction.
I. Current global epidemic
At present, the global epidemic situation in COVID-19 is still at a high level, and the domestic epidemic situation is scattered in many points. During holidays, the mobility and aggregation of people increase, and the risk of epidemic spread increases. The situation of prevention and control is still complicated and severe. In view of the recent COVID-19 epidemic in China, on September 9, 2022, Wu Zunyou, chief epidemiologist of China CDC, issued a document saying that the recent COVID-19 epidemic in China has been one after another, and the main reasons for this severe epidemic are the surrounding environment and mutated viruses. Recently, the epidemic situation in COVID-19 has been one after another all over the country, and the number of confirmed cases and asymptomatic infected people every day has been above 1000, which has lasted for about a month. This is the most severe and complicated epidemic in COVID-19, China, except for the Shanghai epidemic.
Let's take a look at foreign countries. Most countries in Europe and the United States have relaxed epidemic prevention and control measures, including the weakening of detection, or the reduction of the number of reports (the base is already very large), and human factors have created the illusion that the epidemic situation in Europe and the United States is not serious. In the first four waves of COVID-19 epidemic in European and American countries, it is believed that a considerable proportion of people were naturally infected, especially the fourth wave of Omicron strain epidemic, which caused a large proportion of people to be infected. This kind of natural infection+vaccine immunization has a better population protection effect than simple vaccination. Similar views have a great influence abroad, leading to repeated and complicated global epidemics.
Second, the analysis of nucleic acid detection industry chain
Since Wuhan completed the first large-scale nucleic acid detection for about 9.9 million people in May, 2020, as the most important standard for diagnosing COVID-19, nucleic acid screening has become an important means to deal with sporadic epidemic situation in all parts of the country. In the past two years, the multi-site epidemic caused by the evolution of different strains has further created the above-mentioned11500 million detection times.
At the beginning of May this year, the video conference of the State Council joint defense and control mechanism proposed to establish a "sampling circle" of nucleic acid in big cities to broaden the monitoring scope and channels. Beijing, Shanghai, Hangzhou, Ningbo and other places have successively issued nucleic acid detection requirements and laid out nucleic acid sampling points. According to the news released by Hangzhou, there will be no less than 10000 sampling points in Hangzhou, which is convenient for citizens to carry out testing nearby. On April 28th, the policy of normalized nucleic acid detection was started, and the nucleic acid detection was completed every 48 hours.
Under the policy of normalization of nucleic acid detection in various places, according to the calculation of Pacific Securities Research Report, if the policy is extended to the whole country and the detection penetration rate is 40%, the market scale of nucleic acid detection service alone will reach 654.38+054 billion yuan in a single month and 92.2 billion yuan in half a year. This does not include the reagents, consumables and huge raw material market upstream of testing services. Under the temptation of 100 billion market cakes, enterprises entering the market emerge one after another. (After reading the semi-annual reports of more than 50 listed companies with the concept of nucleic acid detection, none of them described the market scale, because this market is difficult to measure and calculate, and some listed companies' operating income in the first half of the year reached more than 20 billion yuan, and no authoritative data was released, so this 92.2 billion yuan can only be used as a reference).
According to the calculation of Southwest Securities, the demand for nucleic acid detection brought by normalized nucleic acid exceeds 654.38+03 billion, including 40 billion upstream equipment, 28 billion midstream reagent market and 68 billion downstream ICL (Independent Medical Laboratory) track.
The research report of Essence Securities once mentioned that according to the data of mainstream reagent manufacturers, the average production cost of colloidal gold kits (direct materials, direct labor and manufacturing costs) is about 1-2 yuan, and the average production cost of nucleic acid kits is about 3-5 yuan.
According to the estimation of soochow securities Research Institute, if normalized nucleic acid detection is implemented in big cities (first-and second-tier cities) in China in the future, the population involved will be about 505 million. If the upper limit of the cost of normalized nucleic acid per month is 1, 21.200 million yuan, then the market scale of 1.45 trillion yuan will be created in one year.
The upstream reagent raw materials and testing equipment are still dominated by overseas giants such as Roche, Novartis, Abbott and Illumina, especially in reagent raw materials. Although the domestic camp has Novozymes and Peng Fei Bio listed in science and technology innovation board, its scale cannot be compared with that of international giants. Domestic nucleic acid detection enterprises mainly focus on midstream reagent production and downstream detection. This paper mainly combs the situation of listed companies in downstream testing.
Faced with the above-mentioned 100 billion market, many new nucleic acid detection enterprises have risen rapidly. However, in May, three nucleic acid detection enterprises in Beijing were suspected of violating the law and committing crimes in the process of nucleic acid detection, and the relevant personnel were taken criminal measures. For example, Jin Zhun Medicine was revoked its business license and its founder was arrested. According to incomplete statistics, from May to July, inspections of nucleic acid institutions were carried out in Liaoning, Qinghai, Anhui, Sichuan, Guangdong, Hunan, Shaanxi, Guizhou, Jilin, Tianjin, Inner Mongolia, Gansu, Beijing and Henan. The survey results show that more than 200 nucleic acid testing institutions have been asked to suspend business or carry out rectification. Some of them are third-party institutions under the listed companies, and even many local CDC and 3A hospitals have been found.
Three. List of nucleic acid detection of A-share listed companies
When screening the list, I did the following work: First, I consulted the relevant articles of online media; The second is to consult the periodic reports of listed companies (mainly the annual report of 2002/KLOC-0 and the semi-annual report of 2022). When doing statistics, I found that the statistics of some online lists are very unreasonable. For example, a company is a vaccine company in COVID-19 and is also included in the list of nucleic acid testing; Some enterprises provide cotton swabs or disinfectant, also called nucleic acid testing companies; Others include medical device companies in the list of nucleic acid testing; Some are indeed nucleic acid detection enterprises, but the volume is very low or even did not get the order, which is of little significance to our investment analysis; Some of them do not belong to the testing industry, but just take advantage of this market demand to temporarily join this market, and the subsequent layout is unpredictable. I think these classification methods are "fake nucleic acid detection companies" from the perspective of investment, and they are typical hot spots! Investors should pay attention to discrimination.
Therefore, the establishment of the list is based on: 1. COVID-19 test list with the same X-shun ifind version 104 shares; Second, according to the announcement of listed companies, enterprises without nucleic acid detection instructions are eliminated (listed companies do not take them out themselves, so it is unlikely to be laid out in this respect in the future); The third is to verify the list of network parts one by one, and confirm the list of related businesses announced by listed companies before being included; Fourth, according to its business scale and positioning, eliminate companies that have no reference value for us. To sum up, there is an exclusive list (26) of nucleic acid detection of A-share listed companies.
Note: The above operating income is the total income of the company, including other business income of the company.
Fourth, data analysis and prediction.
Judging from the results of the 2022 interim report just released, the "nucleic acid trajectory" stands out. According to the above data, the total revenue of 26 A-share listed companies involved in nucleic acid detection reached11300 million yuan in the first half of the year, with a total net profit of about 46.9 billion yuan and a profit margin of about 30%. In the same period, among more than 4,800 A-share listed companies, less than 400 can reach this level. Is it strong? Since the outbreak of the COVID-19 epidemic in 2020, the enterprises that stepped on the slogan of nucleic acid detection have highlighted their ability to absorb gold, attracting many enterprises to compete for layout. But investors need to think carefully about whether the money earned now can be obtained in time and whether the follow-up trend will continue.
1, the income is concentrated in the first few companies.
In the disclosed performance of 202 1, the enterprise with COVID-19 inspection business (104) has brought in 376.5 billion yuan (according to statistics, the income brought by COVID-19 inspection business is about/kloc-0.00 billion yuan) and contributed 66.3 billion yuan in net profit (including the performance of other business sectors). But this business is an oligopoly, and the market share of the top ten companies is close to 60%. The policies related to the normalization of epidemic prevention and control have ushered in a larger growth space for the nucleic acid testing market.
According to the data of this year's interim report, the operating income of these 26 listed companies is11300 million yuan, and the net profit is 46.9 billion yuan. The top ten companies have an operating income of 80.532 billion yuan, accounting for 72% of the 26 companies, and the core part is outstanding.
Different from the above-mentioned domestic "nucleic acid" detection enterprises, Jiu 'an Medical is unique in the nucleic acid detection sector, with revenue of 23.2 billion (up 3989.07% year-on-year) and net profit of 654.38+052 billion (up 3989.07% year-on-year). The main business of Jiu 'an Medical is the detection of "antigen" in COVID-19, and foreign sales account for its total income. From February 20021year to March 2022, a new round of epidemic peak in the United States, because the speed of increasing production in the United States was less than expected, the supply of testing reagents was in short supply for a long time. IHealth COVID-19 antigen test kit was authorized by US FDA EUA on 202 1 and began to be sold. According to the disclosed US government purchase order, the company won about 70% of the first batch of 500 million-person kit purchase contracts and became an important support force for epidemic prevention in the United States. The delivery volume of this suite project exceeds any previous project, reaching 30 million people at the peak of daily delivery. The operating income of iHealth series products in the first half of 2022 was 23.052 billion yuan, accounting for 99.08% of the company's total revenue. What will happen in the second half of the year? According to the tonality of European and American countries, we still hold a conservative view, and we will wait and see.
Daan Gene is one of the few companies involved in upstream equipment, midstream reagents and downstream detection. Benefiting from the layout running through the upstream and downstream of nucleic acid detection, Daan Gene's revenue in the first half of the year was comparable to that of a printing machine, with a revenue of 6.676 billion yuan and a net profit of 3.608 billion yuan, with an unattainable net profit rate. Novel coronavirus (20 19-nCoV) Daan gene nucleic acid detection kit (fluorescence PCR method) is one of the first seven products to enter the fast approval channel of the State Medical Supplies Administration. The report on the results of the first national novel coronavirus nucleic acid rapid laboratory interstitial evaluation released by the National Clinical Laboratory Center in April 2022 showed that the proportion of laboratories using Daan gene COVID-19 nucleic acid detection reagents was 62.9%, ranking first. According to the report on the external quality evaluation/capability verification results of novel coronavirus nucleic acid detection (receiving centralized separation point sample testing institutions) in July 2022, the proportion of laboratories using Daan Gene COVID-19 nucleic acid detection reagents was 23.9%, still ranking first in the industry.
Dean diagnosis represents the current situation of offline sampling and testing institutions. In the first half of the year, the income from detection and diagnosis business was10.753 billion yuan, up by 85.68% year-on-year, and the net profit was 265.438+84 billion yuan. From the perspective of profit rate, offline nucleic acid sampling and testing is relatively "hard and tiring work". Jinyu Medical, located in ICL circuit, made a profit of 8.3/kloc-0.20 billion yuan in the first half of the year, with a net profit of only/kloc-0.783 billion yuan. In the first half of 2022, it completed the nucleic acid detection10.50 billion tubes, and participated in the nucleic acid detection in 30 provinces including Zhejiang, Tianjin, Jiangsu, Inner Mongolia, Heilongjiang, Henan, Shanghai and Beijing. Among the total operating income of 654.38+00.75 billion yuan realized in the reporting period, COVID-19's nucleic acid detection income was 4.75 billion yuan, accounting for 44.2%.
2. The accounts receivable are high, and the performance quality remains to be seen.
From an early point of view, the nucleic acid detection industry is really good, but with the development of time, the ecological and social environment of most industries will change. Judging from the financial report in the first half of this year, COVID-19 nucleic acid detection enterprises are still profitable, but the performance quality is worrying. Many enterprises have high accounts receivable, which is almost equivalent to the total revenue in the first half of this year. From the numerical point of view, the company's revenue and net profit have indeed increased substantially, but everyone's accounts receivable are high and cash flow is tight, which greatly reduces the quality of performance. Because, at present, most of the cost of nucleic acid testing in COVID-19 mainly comes from the government's financial input.
According to investors' inquiries about the company, most companies replied that due to the impact of the COVID-19 epidemic, the company's account period will be extended, because in recent years, the overall social and economic development of our country has slowed down, financial funds have been invested heavily in the prevention and control of the COVID-19 epidemic, and the settlement of nucleic acid testing fees in some areas has been postponed with great probability, expressing understanding and helplessness. As the epidemic continues, it may further aggravate the risk of bad debts that some private medical institutions may bring, leading to a decline in annual performance.
In addition, with the improvement of the accuracy of epidemic control and the decline of testing price competition, the scale and profitability of testing in COVID-19 are likely to reach the peak.
3. The profits of the industry are gradually declining.
At the beginning of the epidemic, few companies were able to detect nucleic acids, so as long as you have the ability, there will be a market, and the profits of previous products will be high. However, with the development of the epidemic, dozens of domestic companies have the ability to produce nucleic acid detection products, and everyone competes with each other, resulting in the sales price has rapidly dropped to the cost price range, and the profit is even minimal.
The sharp drop in the cost of nucleic acid detection in COVID-19 further reduced the profits of this industry. On May 2nd, the Beijing Municipal Medical Insurance Bureau issued the Notice on Further Reducing the Price of Nucleic Acid Testing Items in novel coronavirus. The price of nucleic acid testing for a single sample was reduced from 24.9 yuan per person to 19.7 yuan, with a decrease of more than 20%. At the same time, the price of mixed testing dropped from 5.9 yuan to 3.4 yuan, by 42%. On August 22nd, Yunnan centralized drug purchasing platform showed that the price of four sets of COVID-19 nucleic acid detection kits won by Sheng Xiang Bio dropped to 3.6 yuan/person. At the beginning of 2020, the initial price of nucleic acid testing is 200 yuan per person. The era of lying down to make money has passed, but for enterprises that have just laid out their industries and have not yet formed scale effects, there are still many unknowns in the future.
Normalized testing requirements have made many listed companies outstanding, and the market game is always going on simultaneously. Whether for ordinary people or government departments that bear the cost, testing is only a passive demand caused by repeated epidemics. This demand is unlikely, and we don't want it to be a long-term demand. From a technical point of view, this long-term possibility will not be supported.
4, the market depends on it, look at your own nature.
Although it can't be compared with the upstream in profit rate level, the competitive pattern of ICL track is gradually solidified and upgraded. Institutional research shows that the domestic independent third-party medical testing market has formed a "4+X" pattern, and the combined market share of Jinyu Medical, Dean Diagnostics, Aidikang (Hong Kong stocks) and Daan Gene has reached more than 70% (Jiu 'an medical market is mainly abroad). More crucially, the sampling inspection link was not included in centralized procurement.
The change of nucleic acid detection tuyere has created different myths of making wealth at different stages. The development of any industry should follow the laws and rhythms of social development. Short-term profiteering is reasonable in the case of temporary mismatch between supply and demand, but it will inevitably lead to self-attack in the long run. This is especially true for the nucleic acid detection industry. Once the policy is adjusted, the whole industry may face directional changes.