On the evening of January 22, Kangtai Biological released its 2024 performance forecast. The performance forecast shows that in 2024, Kangtai Biological will achieve a net profit of 190 million to 270 million yuan, a year-on-year decrease of 77.94% to 68.65%. Last year, this figure was 861 million yuan.

Kangtai Biological said that due to market competition, inventory reduction and other factors, the company's operating income has declined to a certain extent compared with the same period last year; coupled with the increase in fixed asset depreciation expenses, asset impairment, and the termination of the 2023 equity incentive plan to accelerate the exercise of rights, the net profit in 2024 has decreased compared with the same period last year.

On January 23, Jiemian News called Kangtai Biological's secretary's office. The staff responded that Kangtai Biological's full range of products has not been reduced in price.

Since the unit price of the vaccine has not dropped, the decline in total revenue means that the sales volume has declined.

The sales performance of non-immunization program vaccines directly determines the performance of Kangtai Biological's overall revenue. Taking the 2024 semi-annual report as an example, non-immunization program vaccines accounted for 95.79% of Kangtai Biological's total revenue, and immunization program vaccines accounted for only 2.23%.

In the field of non-immunization program vaccines, Kangtai Biological's products cover a wide range, including 13-valent pneumococcal polysaccharide conjugate vaccine, freeze-dried human rabies vaccine (human diploid cells), 23-valent pneumococcal polysaccharide vaccine, inactivated new coronavirus vaccine (Vero cells), recombinant new coronavirus vaccine (Y25 adenovirus vector), acellular diphtheria, tetanus and pertussis type b Haemophilus influenzae combined vaccine (quadruple vaccine), type b Haemophilus influenzae combined vaccine, and varicella live attenuated vaccine.

In terms of immunization program vaccines, Kangtai Biological's products include recombinant hepatitis B vaccine (brewer's yeast), measles and rubella combined live attenuated vaccine, and adsorbed acellular diphtheria, tetanus and pertussis combined vaccine.

Batch release is a prerequisite for vaccine sales. Although it is not equivalent to actual sales, it can reflect the company's production and supply capabilities and market expectations.

Judging from the batch release data in the first three quarters of 2024, Kangtai Biological's vaccine batch release batches showed a year-on-year increase.

According to Southwest Securities, in the first three quarters of 2024, Kangtai Biological's quadruple vaccine was released in 24 batches, a year-on-year increase of 4%; 13-valent pneumococcal polysaccharide conjugate vaccine was released in 22 batches, a year-on-year increase of 47%; 23-valent pneumococcal polysaccharide vaccine was released in 11 batches, a year-on-year decrease of 8%; Type b Haemophilus influenzae conjugate vaccine was released in 11 batches, a year-on-year increase of 175%; Hepatitis B vaccine was released in 55 batches, a year-on-year increase of 96%. The share of freeze-dried human rabies vaccine (human diploid cells) batch release increased from only 1% in 2023 to 6% in the first three quarters of 2024.

Despite the year-on-year increase in batch release batches, Kangtai Biological stated in its 2024 performance forecast that total revenue declined, which may mean that the increase in the number of batch releases has not been fully converted into sales, and production costs have risen.

It is an indisputable fact that the competition in the self-paid vaccine industry has intensified, and the difficulty of selling self-paid vaccines is also increasing.

Jiemian News once reported that starting from June 2023, a large number of self-paid vaccines will be reduced in price, and domestic vaccines will bid farewell to the era of high profits. The industry leader Sinopharm Group fired the first shot in the industry's price reduction. Among them, there are 6 non-immunization program vaccines, including quadrivalent influenza vaccine, tetanus vaccine, varicella attenuated vaccine, measles, mumps and rubella combined attenuated live vaccine, type b Haemophilus influenzae conjugate vaccine and oral rotavirus live vaccine, with a reduction ranging from 18% to 30%.

In the future, it is still uncertain whether the scope of vaccine price reduction will be further expanded, but the competition in some sub-sectors has become increasingly fierce. In particular, pneumonia vaccine and rabies vaccine have become a must-win for major companies.

For example, the pneumonia vaccine market has both foreign brands and domestic manufacturers. As of the end of 2023, the number of pneumonia vaccines approved for marketing in my country has reached 9 (excluding delisted vaccines), mainly including 3 13-valent pneumococcal polysaccharide conjugate vaccines (PCV13) and 6 23-valent pneumococcal polysaccharide vaccines (PPV23).

7 are domestic pneumonia vaccines from five local companies, Watson Bio, Minhai Bio, Chengdu Bio, Sinovac Biotech, and Zhifei Bio; 2 are imported vaccines from Pfizer and Merck. Among them, Pfizer China's 13-valent pneumococcal polysaccharide conjugate vaccine will be discontinued in November 2023 and will be promoted and sold by Shanghai Pharmaceuticals. Merck's 23-valent pneumococcal polysaccharide vaccine is represented by Zhifei Bio.

Rabies vaccines also face a similar fierce competitive environment. As of 2023, the rabies vaccines approved for marketing in my country include Chengda Bio, Rong'an Bio, Kanghua Bio, and Hualan Bio. Among them, Kangtai Biological and Kanghua Biological have the only two new generation rabies vaccines in China - freeze-dried human rabies vaccine (human diploid cells).
The high unit price has become the biggest obstacle to the rapid deployment of the new generation of rabies vaccines. Kanghua Biological's freeze-dried human rabies vaccine (human diploid cells) is priced at 315 yuan/unit. Kangtai Biological has not yet announced the price, but the difference is expected to be small. The price of freeze-dried human rabies vaccine (vero cells) has long dropped to less than 100 yuan. For example, Chengda Biological's product is priced at 72 yuan/unit, and Changchun Biological's is as low as 58 yuan/unit.

In addition, Kangtai Biological's freeze-dried human rabies vaccine (human diploid cells) has not yet been officially sold. As of June 2024, the product has completed access to 23 provinces, autonomous regions, and municipalities directly under the central government.

The quadrivalent vaccine is currently Kangtai Biological's exclusive product. At present, the research and development of multi-unit vaccines has become a major trend in the development of the industry. It is more economical for vaccine recipients and has higher compliance. Since 2019, Zhifei Bio's trivalent vaccine (group A and group C meningococcal-Hib conjugate vaccine, AC-Hib) has failed to pass re-registration. In January this year, Olin Bio's similar product was also not approved by the National Medical Products Administration. Therefore, the only competitor of Kangtai Bio's quadruple vaccine is Sanofi Pasteur's pentavalent vaccine (DPT-IPV-Hib) Pantaixin.

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