How Long Can The Third-Party Medical Examination Under The Enterprise Nucleic Acid Detection Reagent Quotation As Low As 8.88 Yuan?

In 2020, the new crown pneumonia epidemic swept the world, and the market demand of IVD (in vitro diagnosis) and ICL (third-party medical examination) industry increased, and the performance of IVD and ICL enterprises also continued to rise, and became the object of capital competition.

According to the statistics of relevant securities companies, among the companies that have disclosed the performance forecast in 2020, there are 26 listed companies with the performance forecast increased in advance. Among them, the net profit of Shengxiang biological, Daan gene, Dongfang biological and Mingde biology increased by more than 1000% year-on-year.

With the coming of winter and spring, the epidemic situation in many places in China has rebounded sporadically. In addition, the tide of returning home during the Spring Festival brings about large-scale nucleic acid detection in China. IVD and ICL industry again ushered in huge market demand.

However, at the same time, from January 2021, the prices of nucleic acid determination items have been reduced in succession in China. For example, Hainan Province has adjusted the original price from 160 yuan / person time to 98 yuan / person time; Hubei Province has been adjusted from 132 yuan / person time to 80 yuan / person time; Harbin City, Heilongjiang Province has been adjusted from 109 yuan / person time to 80 yuan / person time.

So, what kind of development situation will IVD and ICL industries face in 2021? On January 26, Li junyang, deputy general manager of Beijing Kangai Ruihao Biotechnology Co., Ltd., told reporters: "in the future, with the gradual stabilization of the epidemic situation and the retreat of the upsurge of returning home, there is still room for further reduction in the price of nucleic acid detection. It is expected that the growth rate of market demand will slow down in March. Companies will rely on large-scale orders to reduce marginal costs, so as to ensure the steady fall of net profit. The industry market is gradually shrinking, and the profit continues to decline. No matter for the production enterprises or testing institutions, the kit production and nucleic acid detection business can not be regarded as the main business, but only as one part of many businesses. Taking advantage of the epidemic situation and the favorable situation of the industry, the transformation can survive for a long time. "

Bottom of price

On January 28, the annual Spring Festival transportation will begin. But this year, unlike previous years, nucleic acid testing is required for returning home.

This new policy will bring huge market demand to many IVD and ICL enterprises. The kit manufacturers are in the upstream of nucleic acid detection service chain, the third-party inspection institutions are in the middle reaches, and the suppliers are connected to the terminal market.

According to the calculation of Hua'an securities, the implementation of the policy will provide a 10 billion level new market for the manufacturers of nucleic acid detection products. For the detection service providers, there is a 100 billion level market increment.

At present, sporadic cases have appeared in Hebei, Shanghai, Beijing and Northeast China, and the regional collective nucleic acid screening has become a normal requirement. As of 6:00 p.m. on January 23, the nucleic acid detection of all the major communities in Changchun City, Jilin Province has been completed, with a total of 5.1423 million people detected. The screening and exclusion of all staff in prevention and control in medium and high-risk areas also brings benefits that cannot be ignored for the industry. However, there are many limitations behind the huge market growth brought by home nucleic acid detection and centralized exclusion screening.

Due to the large population base, the centralized exclusion screening business often adopts the mode of mixed sampling and mixed inspection. To a certain extent, the mode of mixed inspection and mixed purchase can reduce the testing cost and improve the screening efficiency, but at the same time, it also extends the single business time of enterprises to a certain extent.

At the same time, undertaking the "total nucleic acid testing" can bring huge order amount, but because the government's public health expenditure allocation has a period of several months to half a year, the enterprise's revenue return is slow.

In addition, Wang Jiangping, Vice Minister of industry and information technology, said that by August 2020, China's weekly production of nucleic acid detection reagents would reach 46.48 million, and the weekly production capacity of nucleic acid detection equipment would reach more than 1200 sets. With the normalization of epidemic prevention and control, the demand for nucleic acid detection equipment and reagents has decreased. In the middle of the epidemic, the production capacity of the kit has reached a certain scale, which is enough to support the demand, which means that the market expansion of nucleic acid kit will be limited in the future. After more than one year's development, there have been a number of head players who have formed huge advantages in technology, talent, security and operation, and gradually occupy the living space of emerging players.

Zheshang Securities report pointed out that in the performance forecast of Shengxiang biology in 2020, the lowest quotation of nucleic acid detection reagent was only 8.88 yuan / person, indicating that the price of nucleic acid detection reagent had reached the bottom. The fact that the price has bottomed out and the demand is still supported means that the future profits will fall steadily and the cost of the kit will be hard to compress.

In this regard, Li junyang said that at present, the supply price of nucleic acid detection kits is relatively transparent, and the cost control is relatively low. In selecting the upstream, the first measurement standard is good enterprise qualification, good product quality and supply chain stability. "The company's Beijing aokanghua medical laboratory has just undertaken the centralized nucleic acid screening and testing in Shunyi District of Beijing. Since the development of nucleic acid detection business, there have been upstream kit suppliers to negotiate business, but the conversion rate of kit cost and profit is too low, so it is necessary to replace the upstream

Innovation is not easy

The main method of nucleic acid detection is fluorescent PCR. The general principle is to take the unique gene sequence of the virus as the detection target, and expand the target by technical means, so that the target can be increased exponentially. Each amplified DNA sequence can combine with a segment of fluorescent labeled probe and generate fluorescence signal. Therefore, the more target genes are amplified, the stronger the signal is, and the infection can be determined.

"In the future, there will be two fluctuations in the nucleic acid detection Market: one is the end of the homecoming tide; the other is the end of large-scale vaccination nationwide. Therefore, March and April this year will be the golden period for IVD industry, and the follow-up demand will continue to decline, and the market demand for antibody detection will rise Li junyang said.

According to Li junyang's analysis, it is relatively difficult to develop the alienation mode of competitive products and business trips. "New product research and development needs clinical experience and testing, and the seasonal appearance of new coronavirus makes the profit and revenue unstable. The abnormal operation greatly increases the threshold of new nucleic acid detection research and development, and the return on investment is low. Therefore, most companies will not focus on nucleic acid detection, and will still focus on the original main business

However, it is worth mentioning that it is difficult to form differentiated competition, which does not mean that innovation is impossible. On January 13, the construction of zero contact detection nucleic acid base proposed by Shengxiang biological integrated automatic nucleic acid detection scheme was completed. In this mode, a sample adding robot is used, and the whole operation is carried out in the biological safety cabinet. The "zero open contact" between human and biological samples can complete the opening, transferring and closing operations of samples in nucleic acid detection with one button, so as to realize the "zero open contact" of the original sample tube directly on the machine, automatically open the cover, automatically close the cover, and transfer the sample. The high-efficiency visual recognition system can capture the liquid without dropping Leakage, avoid cross contamination.

However, generally speaking, nucleic acid testing itself does not have too high technical barriers. The threshold lies in the qualification of the laboratory, but this is not difficult for the head players to obtain. Therefore, when the epidemic prevention and control comes to an end, the nucleic acid detection business will return to normal and the capital market will tend to be rational.

For nucleic acid detection products or services of non main business enterprises, short-term good can not support the future of enterprises, or to focus on the development of main business.

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