Sinopharm, Johnson & Johnson, Novartis, Bayer, and Gilead: Major Moves in Pharma – M&A, Leadership Changes, and Strong H1 2024 Results

Jul 20, 2024 10:04 CST Updated 10:04

Johnson & Johnson

Medical Device R&D and Manufacturer

CR PHARMA COMM

Pharmaceutical Circulation Service Provider

Gilead Sciences

Innovative Drug Developer, Distributor

Review of This Week's Content

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1.8 Billion! CR PHARMA COMM Acquires This Foreign Enterprise

News on the evening of July 17 showed that CR PHARMA COMM and Boya Bio will act as the acquirers, purchasing 100% of the equity in Green Cross Hong Kong held by GC Corp, South Korea's third-largest biopharmaceutical company, for 1.82 billion yuan. This will indirectly acquire its blood products business in China, Green Cross (China).

New Health World learned that Green Cross China focuses on the research, production, and sales of blood products.Currently, it has four plasma collection stations in China and offers six types of blood products, including albumin, IVIG, Factor VIII, fibrinogen, anti-HBs immunoglobulin, and tetanus immunoglobulin. It is one of the few blood product enterprises in China that simultaneously holds the sales rights for both human-derived Factor VIII and recombinant Factor VIII.

In 2023, the companyThe plasma collection volume was 104 tons, with a compound annual growth rate of 13% from 2017 to 2023.。

Is a wave of delistings in the pharmaceutical H-shares coming?

On July 15, China中药 and 复宏汉霖, which had previously announced their privatization and delisting from the Hong Kong stock market, successively disclosed the latest developments in their announcements.

Among them,Due to certain preconditions for privatization not yet being met, the comprehensive document regarding the privatization proposal by Henlius needs to be delayed in mailing.In terms of China's traditional Chinese medicine, the offeror has currently prepared relevant documents and continues to liaise with relevant authorities to meet the preconditions for privatization.。

Prior to the aforementioned two companies, a biopharmaceutical company focusing on oncology and severe infectionsSciClone Pharmaceuticals officially bid farewell to the Hong Kong Stock Exchange on July 5th at a cost of HK$11.8 billion., sparking a discussion within the industry about why privatizations occur frequently in Hong Kong stocks.

Bayer China Adjusts Business and Functional Team Structure, to Be Completed by the End of September

As the DSO operation model continues to advance, Bayer's China regional company structure is undergoing a major adjustment, including business teams, functional departments, and more.

Reports indicate that Bayer China's institutional and personnel structure adjustments actually began quietly in June this year. In mid-July, Zhou Xiaolan, Global Executive Vice President of Bayer Group’s Prescription Medicine Division and President of Bayer Group Greater China, announced to employees,Bayer China will be restructured into five business segments and six functional departments.

Insiders revealed that relevant personnel adjustments at all levels across various business units of Bayer China are expected.Will be fully completed by the end of September this year.

Johnson & Johnson Medical Appoints New President for China Region

On July 15, Johnson & Johnson announced,Zhou Mintao will serve as the President of its Medical Technology China Region.And report to Vishnu Karla, Chairman of Johnson & Johnson Medical Technology Asia Pacific. Meanwhile, Zhou Mintao has also become a member of the Johnson & Johnson Medical Technology Asia Pacific leadership team.

Gilead Sciences' Chief Medical Officer to Step Down

On July 17, Gilead Sciences announcedMerdad Parsey, current Chief Medical Officer, to leave the company in early 2025Prior to this, Parsey will continue to oversee Gilead's global clinical development and medical affairs departments.

Parsey in 2019On the Eve of the Global COVID-19 PandemicJoining Gilead marked the beginning of a critical period of rapid development in the field of virology for the company. Amidst the market opportunities brought by the COVID-19 pandemic, Gilead launched its renowned COVID-19 treatment drug, Remdesivir. By the end of 2022, Gilead also received approval for its first HIV drug, Lenacapavir.

Under the leadership of Parsey,Gilead’s portfolio has more than doubled, with 54 clinical studies currently underway in the fields of virology, oncology, and inflammation., butProgress in the field of oncology has not been smooth.In 2020, Gilead Sciences absorbed two bad assets totaling over $25 billion: its CD47 antibody product and the clinical trials of its TROP-2 ADC drug Trodelvy, including extension trials, both failed successively.

Johnson & Johnson's Revenue Reaches $43.8 Billion in the First Half of the Year! Strong Growth in Oncology Sector, Two Drugs Surpass $5 Billion

Recently, Johnson & Johnson released its Q2 2024 financial report.Q2 revenue was US$22.45 billion, a year-on-year increase of 4.3%. The total revenue for the first half of the year was US$43.83 billion, a year-on-year increase of 3.3%.Among them,Pharmaceutical BusinessRevenue in Q2 was US$14.49 billion, a year-on-year increase of 5.5%; revenue in the first half of the year was US$28.05 billion, a year-on-year increase of 3.3%.

Johnson & Johnson achieved robust performance growth in the first half of this year and also actively expanded its business footprint through a series of mergers and acquisitions. Johnson & JohnsonSales revenue for 2024 is expected to reach $89.4 billion, increasing by 6.4% year-on-year.。

Novartis' Net Sales Increase by 11% to $24.3 Billion in the First Half of the Year!

On July 18, Novartis released its financial report for the second quarter and first half of 2024. The report showed that the company's total net income for the second quarter of 2024 was $3.2 billion, with net sales of $12.5 billion (+9%, +11% cc [constant currency, abbreviated as cc]).In the first half of 2024, the company's total net revenue was US$5.9 billion, and net sales were US$24.3 billion.（+9%，+11% cc）。

Financial Performance in the Second Quarter

Net sales were $12.5 billion (+9%, +11% cc [constant currency, hereinafter]).
Revenue was $4 billion（+43%，+47% cc）。
Net income was $3.2 billion (+43%, +49% cc), primarily driven by an increase in operating revenue.
Core operating revenue was US$5 billion(+17%, +19% cc). The core operating profit margin was 39.6% of net sales, an increase of 2.5 percentage points (+2.7 percentage points cc).
Core net income was US$4 billion(+14%, +18% cc), mainly due to the increase in core operating revenue.

Financial Performance in the First Half of the Year

Net sales were $24.3 billion (+9%, +11% cc).
Revenue was USD 7.4 billion (+36%, +43% cc).
Net income was $5.9 billion (+34%, +43% cc), primarily driven by an increase in operating revenue.
Core operating income was USD 9.5 billion (+16%, +21% cc), mainly driven by an increase in net sales, partially offset by increased R&D investments. The core operating income margin was 39.0% of net sales, up 2.4 percentage points (+3.1 percentage points cc).
Core net income was US$7.7 billion(+14%, +19% cc), mainly due to the increase in core operating revenue.

Mid-Year Performance Forecast: Kangmei Pharmaceutical, First Pharmaceutical, Buchang Pharmaceutical

Kangmei Pharmaceutical Returns to ProfitabilityTCM Sector Revenue Increases by Over 20% Year-on-Year

According to preliminary estimates, Kangmei Pharmaceutical is expectedNet profit attributable to母公司所有者的净利润 for the first half of 2024 is expected to be RMB 14 million to RMB 21 million, representing a turnaround from a loss in the same period last year.。

However, after deducting non-recurring gains and losses, the net profit attributable to the parent company for the same period still incurred a loss, ranging from -120 million yuan to -90 million yuan.

Kangmei Pharmaceutical pointed out in the announcement,The revenue scale of the company's traditional Chinese medicine sector in the first half of 2024 is expected to increase by more than 20% year-on-year.At the same time, the gross profit margin has also improved.The gross profit of this sector is expected to increase by approximately 55 million yuan year-on-year.In addition, through meticulous cost management, the relevant expenses are expected to decrease by approximately 5 million yuan year-on-year.

First Medicine Benefits 1.24 Billion from Property DemolitionA large number of newly opened stores reduce profits

Shanghai First Pharmaceutical Co., Ltd. expects,The net profit attributable to the parent company for the first half of 2024 is approximately RMB 115 million to RMB 145 million.Compared with the same period last year, it will increase by 69.1704 million yuan to 99.1704 million yuan.Year-on-year increase of 150.93% to 216.39%.

However, after deducting non-recurring gains and losses, the net profit attributable to the parent company of First Medicine is expected to decrease by 65.89% to 74.42% year-on-year, to RMB 6 million - RMB 8 million, a decrease of RMB 15.454 million to RMB 17.454 million compared with the same period last year.

Stephenson Pharmaceutical's Net Profit Plummets by About 60%Revenue Decline and Rising Costs

In the first half of 2024, Shandong Buchang Pharmaceutical Co., Ltd. is expectedNet profit attributable to owners of the parent company is approximately RMB 186 million to RMB 268 million,Compared with the same period last year, it will decrease by approximately 248 million yuan to 560 million yuan.A significant year-on-year decrease of 64.08% to 75.07%.

Excluding non-recurring gains and losses, the net profit attributable to the parent company's owners for the same period is expected to be approximately RMB 178 million to RMB 260 million, representing a significant year-on-year decrease. The reduction amount is approximately RMB 349 million to RMB 431 million, with a year-on-year decline of 57.31% to 70.77%.

—END—

Selected Highlights：

As National Negotiations Approach, Prices of 1.4 Billion Units Drop Over 50%, Multiple Key Drugs Race to the Finish Line

Big Sales of 9.1 Billion! Surpassing the "Miracle Drug" in Ophthalmology to Take the First Place, 1.8 Billion Varieties Catching Up

Stock Price Surges to Limit! Kangmei Pharmaceutical Removes Restriction and "Reborn"

Review of Pharmaceutical Stocks Listed in H1 2024, Hong Kong Stock Market May See IPO Surge in the Second Half

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