A-Share And H-Share Companies In "Bald Economy"

"People feel bald" is no longer a joke.

According to the survey data of hair loss population released by the National Health Commission in 2019, more than 250 million people in China have suffered from hair loss. In other words, on average, one out of six people lost their hair. There are 163 million men and 88 million women with hair loss, which is equivalent to 1 person in 4 men and 1 person in 8 women.

In this context, the "bald economy" with hair transplant, hair raising and wig as the main force has risen. Whether it is anti hair loss drugs, or hair transplant surgery, or hair loss prevention shampoo, have become the "hair loss army" to save the hairline self rescue action.

According to AI media consulting data, the market size of the domestic hair transplant industry has jumped from 5.7 billion yuan in 2016 to 16.3 billion yuan in 2019. In 2020, the market scale has a trend of breaking through 20 billion yuan.

In addition, according to the data of standing tree information consultation: at present, the industrial scale of anti shedding and hair industry in China is about 11.4 billion yuan.

In China's capital market, Sansheng Pharmaceutical (1530. HK), Zhendong Pharmaceutical (300158. SZ), Kaifa pharmaceutical-b (09939. HK), Xianju Pharmaceutical (002332. SZ), Kangenbei (600572. SH), Yunnan Baiyao (000538. SZ), Renhe Pharmaceutical (000650. SZ), bawangjituan (01338. HK) and many other companies have set up anti hair loss track. Who is more powerful? Who was coerced?

A-share and H-share "anti hair loss" camp: oral, daub and hair transplant

According to public information, the treatment of "hair loss" can be roughly divided into oral drugs, daubing drugs and hair transplantation.

According to the guidelines for the diagnosis and treatment of androgenic alopecia (AGA) published by the Department of Dermatology and Venereology, Chinese Medical Association, two key drugs for the treatment of androgenic alopecia (AGA) are "finasteride" (oral, only applicable to men) and minoxidil (external application).

Data show that finasteride was approved by FDA in 1997 for androgenic alopecia, minoxidil was approved by FDA for androgen alopecia in 1988, and was approved by FDA for over-the-counter drug sales in 1996.

The representatives of minoxidil production in China are Sansheng Pharmaceutical (1530. HK) and Zhendong Pharmaceutical (300158. SZ), a Hong Kong listed company.

Sansheng pharmaceutical is a biopharmaceutical enterprise, whose main treatment fields cover tumor, autoimmune disease, kidney disease, metabolism, skin disease, etc.

In the annual report of 2020, Sansheng pharmaceutical introduced its minoxidil product, "Mandi, commonly known as minoxidil tincture, was launched in 2002 as the first over-the-counter hair loss drug in China to treat male alopecia and alopecia areata (" alopecia areata "). Minoxidil is the only topical drug recommended by the guidelines for the diagnosis and treatment of androgenic alopecia in China (issued by the Chinese Medical Association). According to the guidelines for diagnosis and treatment of alopecia areata in China (2019) issued by the Chinese Medical Association (CMA), minoxidil is listed as one of the local treatment methods for alopecia areata. "

At the same time, Sansheng pharmaceutical said, "the company has begun to compare mn709 (minoxidil foam) with Rogaine? In male alopecia patients? A randomized, double-blind, three-phase study. Patient recruitment has been completed and the Group expects to have data results by the third quarter of 2021. "

Zhendong pharmaceutical's minoxidil product, dafeixin, has gained 20% market share.

Dafeixin is subordinate to Shanxi Zhendong ante biopharmaceutical Co., Ltd., a wholly-owned subsidiary of Zhendong Pharmaceutical Co., Ltd. (hereinafter referred to as "ante pharmaceutical"), according to the announcement of the listed company, ante pharmaceutical mainly focuses on "digestive tract drugs", and its key products are colloidal bismuth pectin capsules, trimebutine maleate, minoxidil liniment, Naozhenning granules, etc.

In addition, there are many A-share enterprises producing oral finasteride, including Xianju Pharmaceutical (002332. SZ), Kangenbei (600572. SH), Sinopharm (600420. SH), Qianjin Pharmaceutical (600479. SH), China Resources Shuanghe (600062. SH), etc.

In addition to "finasteride" and "minoxidil" two generic drugs, in the field of innovative drug treatment, China has entered the late clinical stage (critical phase II) of freitaphan, a pioneer pharmaceutical industry-b (09939. HK).

At the end of 2020, the board of directors of pioneer pharmaceutical-b announced that freitahn (kx-826), a potential local drug of the same kind and independently developed by the company, has completed the phase II clinical trial for androgen alopecia in China (phase II clinical trial).

In addition, on February 1, this year, Kaifeng pharmaceutical-b announcement mentioned that gt20029, developed by protac (targeted protein degradation chimeric) technology, is an androgen receptor degradation agent for external use. It is intended to be used in the treatment of androgenic alopecia and acne. The research of this new drug has been approved by China drug administration.

Compared with drug therapy, hair transplantation has become one of the options because of its more immediate effect.

The 21st century economic report reporter learned that there are four major private chain hair transplant institutions in China: Yonghe hair transplant, barley hair transplant (Keyuan), biliansheng and Xinsheng hair transplant, "rushing to the market".

According to public reports, barley micro needle hair transplantation, formerly known as "kefuring micro needle hair transplantation", was established in 1997, and now there are 33 directly operated hospitals.

Yonghe hair transplant was founded in 1999, and now has more than 60 direct chain organizations.

Founded in 2005, biliansheng has established chain hospitals in 32 cities across the country. In 2018, biliansheng obtained a strategic investment of 500 million yuan from Huagai capital.

Another new hair transplant agency entered the hair transplant industry in 2001, and has set up 43 professional hair transplant service outlets. At present, it mainly focuses on 3D hair transplantation and other technologies.

Although the four private hair transplant institutions have not yet been listed, there are also A-share enterprises quietly layout among them.

For example, in the list of shareholders of Huagai Capital Co., Ltd., the investor of biliansheng, there is Liaoning Chengda (600739. SH), a listed company of a shares, which holds 30% of the shares and is the single largest shareholder.

In addition, Huabang health (002004. SZ) said in response to investors' questions in May this year that "there is a hair transplantation center under the skin of man, which gathers the first-class hair transplant experts in China, and adopts the international advanced mn-fue hair transplantation technology to treat the patients."

According to the annual report of 2020, man skin is a holding subsidiary of Huabang healthcare Co., Ltd., headquartered in Chongqing and established in 2016. Its business covers skin treatment of spots, scars, acne, marks and pits, as well as medical and beauty services such as sensitive muscle care, whitening and anti-aging. Currently, it has more than 30 chain organizations.

Another kind of hair loss prevention products, which are more familiar to people, are distributed by Bawang group, Renhe pharmaceutical, Yunnan Baiyao, etc.

Who is the real "anti detachment" player?

In these camps, who is the real strength player?

Taking Sansheng pharmaceutical as an example, from 2018 to 2020, the sales volume of Mandi products was 127 million yuan, 250 million yuan and 368 million yuan, respectively, with a year-on-year growth of 96.6% and 46.9%. Sansheng pharmaceutical said the increase was mainly due to increased market demand for hair loss and hair growth treatment, which was driven by the company's diversified and effective promotion activities. By the end of December 2020, the sales of small molecule drugs accounted for about 11.5% of the total sales of the group's commodities.

However, the total revenue of Sansheng pharmaceutical in the past three years was 4.584 billion yuan, 5.318 billion yuan and 5.588 billion yuan, and the sales volume of Mandi accounted for less than 1 / 10.

The revenue contribution of minoxidil dafeixin, a subsidiary of Zhendong pharmaceutical, has yet to be observed.

Interestingly, ante pharmaceutical, a wholly-owned subsidiary of the product, was once a long-term loss making asset that Zhendong pharmaceutical tried to sell.

From 2018 to 2020, ante pharmaceutical lost 81.51 million yuan, 49.19 million yuan and 35.16 million yuan respectively.

On January 11 this year, Zhendong pharmaceutical announced that it planned to replace the 100% equity of ante pharmaceutical, a wholly-owned subsidiary, with 2.4038% investment shares of Jundu Derui and 2.4938% investment shares of Jundu Shangzuo held by Zhendong group, and both parties shall make up the difference according to the agreement.

However, on June 1 this year, Zhendong pharmaceutical suddenly announced that it would stop selling ante.

Zhendong pharmaceutical explained that "the sales of difeixin minoxidil liniment for hair loss under ante pharmaceutical were poor in the past few years, and it was not the company's main business variety. However, this year, medical and aesthetic subjects such as male medical beauty and hair loss economy have been widely concerned. The sales of dafeixin minoxidil are growing rapidly, with a sales volume of 50 million yuan in the first quarter of 2021, In the second quarter, there is also a big growth forecast. "

In addition, on May 19 this year, Zhendong pharmaceutical disclosed in response to investors' questions that "the total sales of dafixin minoxidil liniment will be 150 million yuan in 2020".

However, in reply to the inquiry letter of Shenzhen Stock Exchange on June 10, Zhendong pharmaceutical pointed out that "in the annual report of 2020, the revenue of ante pharmaceutical is 180 million yuan, of which the sales of dafixin is 80.3916 million yuan, accounting for 44.69% of the revenue of ante pharmaceutical." At the same time, Zhendong pharmaceutical pointed out that 150 million yuan of "dafixin minoxidil will reach 150 million yuan in 2020 after four years of operation" is the terminal retail sales of dafixin.

It should be pointed out that Zhendong pharmaceutical's current revenue core is still from its "fist product" Langdi calcium.

In 2020, the terminal sales of Zhendong pharmaceutical's calcium preparation product Langdi calcium ranked first in China, with a revenue of 4.3 billion yuan, accounting for 88% of its annual revenue (4.848 billion yuan). Compared with minoxidil liniment, the current contribution of minoxidil liniment is relatively limited.

In addition, Xianju pharmaceutical, Kangenbei, Sinopharm and others said that they only took "finasteride" as one of the company's many product categories for layout.

On May 18 this year, Xianju pharmaceutical explained in reply to investors' questions that "finasteride tablets produced by the company have two specifications of 5mg and 1mg. Among them, 1mg finasteride tablets are mainly used for the treatment of male baldness (androgenic alopecia), which can promote hair growth and prevent further hair loss."

In the follow-up similar questions, Xianju pharmaceutical further explained that "the company's finasteride tablets have passed the generic drug quality and efficacy consistency evaluation in March 2021. At present, the product accounts for a small proportion of the company's business income, and belongs to the potential variety. "

Xianju pharmaceutical is mainly engaged in steroid raw materials and preparations. Its products are mainly divided into three categories: corticosteroids, sex hormones (gynecology and family planning), anesthesia and muscle relaxants.

On June 7, a person related to Xianju pharmaceutical told the 21st century economic report, "the company's business development focuses on technology accumulation and precipitation, and strives to achieve R & D leapfrogging in complex preparation fields with high technical barriers, such as inhalation preparations, semi-solid preparations, sterile suspension and other complex preparation fields. Finasteride tablets are only distributed as one of many categories.

Coincidentally, in the annual report of 2020, Compaq said that finasteride tablets had won the bid for the third batch of drugs in August 2020 without specific revenue data.

In addition, "finasteride tablets (1mg)" was mentioned in the annual report of Sinopharm in 2018, but "finasteride tablets" was not mentioned in the annual reports of 2019-2020.

On June 9, the 21st century economic report called a person from the Securities Affairs Department of Sinopharm. The other side explained that "finasteride tablets are still in production, but the company has a large variety of drugs, and the key products will be focused on each year, so the annual report will disclose it according to the situation.".

In addition, in April this year, China Resources Shuanghe (600062. SH) announced that China Resources SECCO Pharmaceutical Co., Ltd., a wholly-owned subsidiary of the company, received the drug registration certificate (Certificate No.: 2021s00294) of finasteride tablets (1mg) issued by the State Food and drug administration, and approved the production of the drug. The drug is mainly used for the treatment of male alopecia (androgenic alopecia), can promote hair growth and prevent further hair loss. China Resources Secco has invested 3.4183 million yuan in R & D since its R & D work.

With the slogan "fear hair loss, use overlord", Bawang group has launched anti hair shampoo, anti hair care lotion and anti hair shampoo for women. According to the annual report in 2020, Bawang group's core brand, Bawang's business volume is about 261 million yuan, It accounts for 94.6% of the company's turnover classified by brand in 2020 (the total turnover is 276 million yuan), which is about 8.1% higher than that in 2019.

In spite of the growth of anti hair loss products, however, from 2019 to 2020, Bawang group's owners should account for 6.1 million yuan and 4.038 million yuan (RMB) respectively.

In addition, Renhe pharmaceutical has products such as fangtuoyufa liquid and Shengfa pills; Yunnan Baiyao has yangyuanqing shampoo series, anti hair lotion, orange peel black sesame pill and other products, but there is no public revenue data.

Who is the most sought after by capital in different segments?

From the perspective of institutional popularity, Zhendong pharmaceutical is undoubtedly "hot fried chicken".

On May 14, May 20 and June 4 this year, Zhendong pharmaceutical disclosed three investor relations activities respectively.

On June 4, Li Anping, chairman of Zhendong Pharmaceutical Co., Ltd., and Ma Shifeng, President of Zhendong Pharmaceutical Co., Ltd., received on-site visits and investigations by more than 20 institutional and individual investors, including Guiyuan investment, Tangfeng investment, Dongfang HuiFu and Zhengda assets.

From the perspective of stock price, Zhendong Pharmaceutical Co., Ltd. reached a peak of 7.24 yuan / share on June 3 from a low of 4.03 yuan / share in March this year, and its total market value has exceeded 6.4 billion yuan.

However, no securities companies for Zhendong pharmaceutical issued a stock research report.

Sansheng pharmaceutical, a Hong Kong stock company with "minoxidil", has a total market value of more than 25.5 billion yuan. As a biopharmaceutical company, its core products are mainly terbium, Yisai universal recombinant human erythropoietin (rhEPO) products, eBIO and saibor. Sansheng said all four products are market leading products in mainland China.

In addition, another Hong Kong stock company with hair loss products has opened up the pharmaceutical industry with a total market value of more than 23.5 billion yuan.

According to the official website, with androgen receptor (AR) related diseases as the core, pioneer pharmaceutical has developed a multi-channel product portfolio, covering the global high incidence of cancer and other diseases that do not meet the clinical needs, including Xinguan, prostate cancer, breast cancer, liver cancer, alopecia and acne.

However, Huatai Securities was more optimistic about the therapeutic potential of Prochloraz / gt90001 in developing pharmaceutical industry for new crown pneumonia / liver cancer, and reiterated its buying rating.

In contrast, the total market value of Bawang group is only about 348 million Hong Kong dollars, which seems not to be favored by investors.

Bawang group mentioned in its 2020 annual report that in 2021, it will continue to exploit and expand the market share of the younger generation of customers, deepen the anti hair loss awareness of young post-95 and Post-00 college students, and publicize the core concept of Bawang brand anti shedding and hair cultivation to this generation, To cultivate their attitude of recognizing Bawang brand younger, so as to achieve the purpose of spreading and promoting Bawang brand.

Many of the four private hair transplant institutions are favored by capital: in 2017, Yonghe hair transplant was held by CITIC Industrial Fund, and in 2020, China Ping An launched the first hair transplant insurance in the hair transplant industry; Biliansheng obtained 500 million yuan strategic investment from Huagai capital in 2018.

In 2020, Zhang Tong, co-founder and deputy general manager of Xinsheng hair transplant, said in an interview with the media that the company was planning an IPO.

On June 7, a female consumer who spent 10000 yuan and just had hair transplants told 21st century economic report that "hair transplanting is a medical and aesthetic method that more and more people can accept. I do hair transplants to make my hairline more beautiful and add to the icing on the cake". According to her consultation, the charging prices of different hair transplant institutions are very different, "different hair transplant technologies, There are a lot of price ranges, and the premium is relatively high, so we still need to polish our eyes. ".

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