IVD is so profitable. It turned out to be the 3 reasons...

According to the medical website of May 7th, Dongxing Securities recently released the 'Annual Report of the Pharmaceutical Industry and the First Quarterly Summary'. Among the various segments, IVD listed companies performed very well:

In 2017, revenue increased by 28.39%, which was a significant increase from 23.19% in the previous year. In 2017, net profit growth was as high as 21.86%, which was 14.94% higher than the previous year!

Specific to the growth rate of the company's net profit, Sannuo Life was 123.94%, Wanfu Bio was 45.32%, and Derry Medical was 33.77%. The performance was dazzling.

Dongxing Securities believes that there are three reasons for the rapid growth of the income side and profit side of the IVD segment:

The first is policy promotion, import substitution superimposed classification diagnosis and treatment, to promote the continuous growth of high-quality IVD company performance.

In terms of import substitution, biochemical and immunological diagnostics accounted for a large share of the domestic IVD market, reaching more than 30%, of which immunodiagnostics was mainly chemiluminescence, and the major domestic manufacturers of chemiluminescent reagents and instruments were Roche, Abbott, and Beckman. , Siemens and other imported brands, occupy about 90% market share.

With the domestic manufacturers of chemiluminescence reagents and instruments product quality With the continuous improvement, some domestic first-line companies such as Antu Biology, Mike Biotech have entered the top-tier/third-tier hospitals to compete positively with imported brands. Some of the testing items (such as infectious diseases, etc.) are currently at the same level of quality as imported products. And the price has a greater advantage.

With the national support for domestic medical instruments With the continuous deepening of policies, domestic high-quality products will have an accelerated substitution effect in the future, which will benefit domestic IVDs. enterprise.

In terms of grading diagnosis and treatment, as the policy of grading diagnosis and treatment continues to advance, the sample size of newly diagnosed primary care institutions rapidly increases, and the demand for IVD products further increases. The products require high cost-effectiveness, rapid detection methods, and are easy to learn. POCT/small-scale biochemical immunization Testing equipment and other products can meet the needs of the primary medical institutions, Wan Fu biological, base egg biological, etc. will be well received.

The second is the integration of IVD channels: rushing around, a variety of models to drive business growth.

Since the second half of 2015, domestic IVD channels began to be integrated. With the continuous implementation of the two-vote system in each province, the company has entered a period of rapid development. IVD manufacturers such as Mecon Biotech, Antu Bio, etc. are promoting in all provinces. hospital Collective mining, regional inspection center and other models.

The packaging model saves procurement costs for hospitals, and for IVD manufacturing companies, the terminal stickiness can be increased through the packaging of reagents and instruments, and continuous self-production/proxy The volume of the product at the hospital terminal.

IVD's rapid expansion of packaged businesses through the acquisition of channels or the establishment of branch offices throughout the country can be seen as another form of outreach expansion. In the future, with the continuous advancement of IVD channel integration, there are a large number of packaged hospitals/regional inspection centers. Manufacturers will benefit.

The third is other influencing factors.

The IVD product presents a high technology-driven attribute, which is a subdivision of rapid iterations of methodologies and test items such as chemiluminescence instead of enzyme-linked immunosorbent assay (ELISA) and the rapid promotion of new POCT test items (infection/blood coagulation/chronic disease). And so on, enterprises with fast product replacement will continue to benefit.

In addition, seasonal factors can also be concerned, such as rapid influx of infectious test reagents brought by the flu, such as the PCT/CRP test reagents of Wanfu Bio, and the agent of the nine-respiratory respiratory reagents from Antuo.