Pharmaceutical mergers and acquisitions in the first half of the year: 140 from nearly 66 billion | Biomedical Chengxiang

Pharmaceutical Network June 30th In 2018, half of the time has passed, and the popularity of pharmaceutical listed companies has not decreased.

In the 21st century economic report, according to the incomplete statistics of Wind and listed company announcements, from January 1, 2018 to June 29, 2018, there were 140 mergers and acquisitions in the pharmaceutical health listed companies, with a total amount of nearly 66 billion yuan. Involving biopharmaceutical companies, medical services, retail pharmacy And so on.

Many industry insiders said in an interview with the 21st Century Business Herald that the reason why a large number of pharmaceutical listed companies carry out mergers and acquisitions is to improve the regional layout, extend the industrial chain, and increase the market value. 'For example, pharmaceutical companies can enter the terminal. With some resources, mergers and acquisitions in the circulation field can broaden the regional layout. ' On June 28, Shi Lichen, founder of the third-party medical service platform, said.

In addition, industry insiders including Sun Yi, executive partner of Jiuyou Capital Medical and Health Division, pointed out to 21st Century Business Herald that the two-vote system, classified medical treatment and other pharmaceutical industry reform policies are inseparable from mergers and acquisitions. Introduced.

Regarding the trend of mergers and acquisitions, Sun Yi pointed out that domestic biomedical research and development has developed well in recent years, and mergers and acquisitions in this field will be the mainstream of medical M&A projects in the future. Shi Lichen believes that future hospital mergers and acquisitions are expected to accelerate, 'because many pharmaceutical companies To enter the terminal, you need to master some hospital resources; there are coal, housing enterprises and other enterprises that want to enter the big health field, the hospital will be the entrance.

The extension of development, that is, the promotion of enterprise development through mergers and acquisitions, etc., seems to have become the standard of pharmaceutical health enterprises in recent years.

According to incomplete statistics from the 21st Century Business Herald, from 2018 to the present, there have been 140 mergers and acquisitions by listed companies in the medical and health industry. In January, related listed companies disclosed 25 mergers and acquisitions, 18 in February, and 19 in March. From April to June, 23 cases were disclosed, 24 cases and 31 cases respectively.

The mergers and acquisitions of some listed companies also showed an intensive trend. For example, only in May, Baron has announced four mergers and acquisitions news. It plans to acquire 70% of Guangxi Pharmaceuticals and not more than 25.9 million yuan in purchases of not more than 100 million yuan respectively. Four Seasons Huitong Pharmaceutical 70% equity, 12 million yuan acquisition of 30% stake in Sunsilsel Biomedical and 18 million yuan acquisition of 100% stake in Xi'an Kangbaier Pharmaceutical.

In the period from March to May, Yihua Health announced four mergers and acquisitions news. The proposed total price was 1.055 billion yuan to acquire Shandong Shilin Hospital Holding Group Co., Ltd. and Yushan County Pok Oi Hospital Co., Ltd. and other four companies.

In terms of transaction amount, the number of transactions was disclosed from 135, with a total scale of 63.227 billion yuan - 65.837 billion yuan, and a single transaction amounting to more than 100 million yuan, altogether 73 cases, of which, more than 1 billion yuan reached 14 cases, such as music General Health announced on February 28 that it intends to participate in the auction of 45% equity in New Donggang Pharmaceuticals, and the final transaction price was 1.05 billion yuan; Yifeng Pharmacy announced on June 23 that the proposed price was approximately RMB 1.384 billion to acquire the emerging pharmacy 86.31 % equity, to further expand the store network coverage, the latter has more than 460 directly operated stores in Hebei and Beijing.

In addition, there were 1 purchases of more than 10 billion yuan, that is, China Biopharmaceuticals paid about 12.896 billion Hong Kong dollars (about 10.774 billion yuan) to acquire 51% equity of China Bio, 52% of Super Demand; another single transaction was 10 million yuan or less. There are 17 cases, 30 cases with 10 million - 50 million yuan, and 15 cases with between 50 million yuan - 1 billion yuan.

'From the perspective of M&A funds, the scale of transactions is getting bigger and bigger. After 6-7 years from around 2010, pharmaceutical companies have gradually integrated many small enterprises, leaving some large and advantageous targets. The impact is serious, and the IPO is difficult. Many of the larger targets are considering the shot, and the listed companies are also very concerned about such targets, because they have a certain scale and anti-risk ability, and the relative purchase amount is also relatively high. ' June 29 In the interview with the 21st Century Business Herald, the chairman of the Eastern Party, Qiu Si Nian pointed out.

According to 21st Century Business Herald, the merger and acquisition in the first half of the year covered a total of 140 medical and health industries including pharmaceutical industry, medical services, and pharmaceutical circulation. Among them, there were 26 mergers and acquisitions in the pharmaceutical circulation industry, totaling approximately RMB3.879 billion; There are 28 mergers and acquisitions in the field of biomedicine, with a total amount of approximately 27.9 billion yuan.

However, according to the previous statistics of the 21st Century Business Herald and the Wind data, the number and amount of mergers and acquisitions in the medical and health field in the first half of 2018 fell compared with approximately 400 billion from 400 in 2016 and over 400 in 2017.

In this regard, Sun Yi pointed out to reporters in the 21st Century Business Herald that on the one hand, after 2016, the market quality projects will be reduced. In addition, the conditions for the scheduled increase of the project will be harsh, leading to difficulties in the financing of listed companies and affecting the acquisition of relevant sub-industries. Quantity. 'In 2016, it will increase by 2 trillion yuan, and it will drop to several hundred billion in 2017, affecting the acquisition of listed companies.'

In addition, the industry generally believes that the success rate of mergers and acquisitions is not 100%, and it also faces problems such as the disagreement between the parties to the transaction and the lack of expertise of the acquirer.

For example, Shanhe Yaosuke announced on June 28 that due to the quotations in the auction process exceeding the company's valuation after research, the bid for the 75.7408% stake in Xinling (Tieling) Pharmaceutical Co., Ltd. eventually failed; Zhongzhu Medical disclosed on June 15 that RMB 3 billion in acquisition of 74.5262% equity in Kangze Pharmaceutical Co., Ltd., Zhejiang Aide's 100% stake ended in failure due to failure to reach consensus with Zhejiang Aide Shareholders on trading target valuations, performance pledges and other core terms.

According to the announcements of listed companies, the 21st Century Business Herald found out that the reason why the related companies carried out mergers and acquisitions was to improve the layout, extend the industrial chain, develop new business segments, etc., and were driven by policies.

"The reason why companies conduct mergers and acquisitions is because of market competition. They want to expand their scale and take up more market share." Shi Lichen also told the 21st Century Business Herald reporter.

For improving industrial layout, BK shares said that it intends to invest in Kangliyuan Pharmaceuticals as an important step in actively expanding the market in Hebei Province when it intends to acquire 51% equity in Kangliyuan Medicine. It will fully use Kangliyuan Medicine to cover the ferrous and tertiary hospitals and terminals in Zhangjiakou District. The advantages of sales network quickly expand the market.

Yifeng Pharmacy said that after the acquisition of the new pharmacy, it will add 462 stores that are currently operating in Hebei Province and Beijing. Prior to this, the business area of ​​Yifeng Pharmacy was mainly concentrated in the South Central and East China regions.

In addition, some companies hope to expand through mergers and acquisitions to expand new business segments. For example, Shanghai Pharmaceuticals said that by acquiring 100% equity in Takeda Chromo Beteiligungs AG, which indirectly holds 26.34% of the shares of Tianpu Biochemical, it will fill up the natural urine of Shanghai Pharmaceuticals. Protein drug and critical product in the field of subdivision treatment.

Lepu Medical, when investing in Viralytics Australia, said that the introduction of Viralytics' related products can complement the company's tumor immunotherapy product line. Zhang Zhibin, deputy general manager of Lepu Medical, also mentioned in an interview with a 21st Century Business Herald reporter. , Tumor immunity will be one of the directions for the future layout of Lepu Medical.

In spite of the different purposes of mergers and acquisitions, a series of reform policies in the field of medicine and health have become common factors behind mergers and acquisitions.

For example, the two-vote system and prescription outflow have become an important driving force in the above 26 mergers and acquisitions in the pharmaceutical circulation field.

Baiyunshan mentioned in its “Major Asset Purchase Report (Revised Draft)” disclosed on January 6 that in the long term, the “two-vote system” will promote industry consolidation, and small commercial companies without upstream resources and no downstream network will After being eliminated, the concentration of the pharmaceutical distribution industry will further increase. On May 31, Baiyun Mountain officially completed the acquisition of a 30% stake in Guangzhou Pharmaceuticals. The transaction amount was 1.094 billion yuan.

In fact, for mergers and acquisitions in the pharmaceutical distribution industry, the state has been encouraging in recent years.

The former Ministry of Commerce has made it clear that the degree of concentration in the pharmaceutical distribution industry should be increased and it is encouraged to achieve through mergers and acquisitions. The Ministry of Commerce released 2017 on June 21st. drug The Statistical Analysis Report on the Circulation Industry Operation shows that the retail chain rate of drug retailers has further increased. As of November 2017, the retail chain rate of drugs has reached 50.5%, an increase of 1.1% year-on-year. The total number of retail stores in the top 100 pharmaceutical retailing companies in 2017 It reached 58.355 million, accounting for 12.9% of the total number of retail stores nationwide.

'With the outflow of prescriptions from large hospitals, advancement of tiering diagnosis and treatment policies, circulation, and mergers and acquisitions in the field of commercial pharmacies will continue.' Sun Yi pointed out that the policy will be one of the backgrounds to promote mergers and acquisitions of related companies.

From the perspective of subdivision, 21st Century Business Herald reporters found that biomedicine has become a hot spot for mergers and acquisitions. In the first half of 2018, Kang Enbei, Bikang, Xiangxue Pharmaceutical, and Laimei Pharmaceuticals have deployed biomedical fields. .

Among the above 140 mergers and acquisitions, of the total transaction volume of nearly 66 billion yuan, biomedicine accounted for 28 seats, accounting for 20%, and the total amount reached 27.9 billion yuan, accounting for more than 40%.

In addition, the amount of biomedical single purchases is also high, totaling more than 500 million yuan, such as Zhongyuan Concord's purchase price of 1.2 billion yuan to acquire 100% equity of Shanghai Aoyuan; Jiuzhitang's acquisition of 26.87% equity of Kexin Meide is about 10.11 100 million yuan; Kang Enbei's acquisition of 21.05% stake in Jiahe Biological exceeded 673 million yuan.

In addition, investment in biomedicine has also been hot. According to incomplete statistics from 21st Century Business Herald, from January to June 2018, there were 11 biomedicines including Cornerstone Pharmaceuticals, Cinda Bio, and Hualing Medicine. enterprise Announced the completion of financing, with a total scale of nearly 1.03 billion US dollars (about 6.602 billion yuan).

The reason why the mergers and acquisitions in the field of biomedicine, investment has become hot trend, a number of biological drug companies and investment institutions said that the current policy, personnel are helping the development of biomedical. Such as GIC (Sovereign Wealth Fund Singapore government investment company) In a written interview with a reporter from the 21st Century Business Herald, the reason for choosing to invest in the field of bio-innovative drugs was because of the policy support, the return of excellent talents and the huge market size of China's medical health.

Connehbert also mentioned in the acquisition of Jiahe Bio Equity. In recent years, with the support of policy support and technology, China's biopharmaceutical industry will usher in a new era. 'Trastuzumab, Bevacizumab, Nittozamide The monoclonal antibodies, rituximab and ranibizumab, these 5 monoclonal antibodies were also negotiated and included in the health insurance.

Regarding future mergers and acquisitions, the industry believes that biopharmaceutical M&A has already accelerated. For example, according to PricewaterhouseCoopers, the number of transactions in the biological and biotechnology field was 19 in the first half of 2016 and 23 in the second half of 2017. In the six months it reached 36. 'Although the number and amount of strategic investor M&A transactions have declined as a whole, the number of transactions in the biotechnology and biotechnology sectors has increased significantly.'

“R&D of domestic biopharmaceuticals has achieved good development in recent years. The current biopharmaceutical mergers and acquisitions are mainly in the field of cancer, and target targets such as pd1, pdl1, her2 and other clinical indications have a wide range of applications. ' Sun Yi also 21st Century Business Herald reporter said, 'I believe that the domestic biopharmaceutical mergers and acquisitions will be the mainstream of pharmaceutical M & A projects.'

Judging from the point of view of Chou, the 28 M&A bids are bio-pharmaceuticals. Compared with the past four or five years, the proportion is very high, but in the future, this proportion will be more and more. The acquisition of bio-pharmaceuticals by listed companies will be a trend. And it will be an inevitable trend.

However, in the opinion of the industry, due to the high technical threshold and long return period of biomedicine, if the capital side does not have enough professionalism, it will lead to an increase in failure rate.

From the actual merger case, the 21st Century Business Herald found that the hospital has become the target of many companies.

In the first half of 2018, hospital mergers and acquisitions reached 14 cases, with a total amount of 6.547 billion yuan, involving Maanshan Central Hospital, Chancheng Hospital, Qimei Hospital, Double Mine Hospital, Baishui Jimin Hospital, Liupanshui Anju Hospital and many other medical institutions.

In addition to medical services companies such as Hengkang Medical and Zhongzhu Medical, 21st Century Business Herald found that pharmaceutical companies including Tonghua Jinma, Kangzhi Pharmaceutical, Lingkang Pharmaceutical also joined the camp of M&A hospitals. The announcement on June 2 stated that the company intends to use the cash of RMB 321.3 million to acquire 100% equity of Guangzhou Ruiqi, thereby indirectly holding 51% equity of the target hospital Yunnan Jiuzhou Hospital and 51% equity of Kunming and Wanjia Maternity Hospital.

Tonghua Jinma announced on May 23 that it plans to acquire 84.14% equity of Qitaiheqiu Coal Hospital, Shuangyashan Double Mine Hospital, Jixi Chicken Mine Hospital, Crane Mine Hospital and Hekang Cancer Hospital for 2.19 billion yuan.

Sun Yi told reporters in the 21st Century Business Herald that pharmaceutical companies' mergers and acquisitions hospitals want to create a closed-loop ecology of medicine, diagnosis and research and development. 'Generally, it is mainly based on mergers and acquisitions and specialized hospitals related to its own products.' Shi Lichen also believes that pharmaceutical companies are I hope to enter the terminal and master some hospital resources.

For example, as a company mainly engaged in the production of children's medicine, Yunnan Jiuzhou Hospital and Wanjia Maternity Hospital acquired by Kangzhi Pharmaceutical are related to children.

Kangzhi Pharmaceutical said that Jiuzhou Hospital and Wanjia Hospital are private hospitals with Assisted Reproductive (IVF) qualifications. This acquisition is a concrete measure for the company to implement the 'Children's Health' strategy.

Tonghua Jinma also mentioned in the above mergers and acquisitions that the M&A medical service institutions can extend to the downstream of the industry. On the basis of R&D, production and sales of drugs, the company's business expands to the downstream comprehensive medical service field. Product marketing costs, on the other hand, can penetrate the upstream and downstream, improve the medical industry chain.

On the specific target, Shi Lichen told reporters in the 21st Century Economic Report that enterprise hospitals are expected to become popular targets. 'Because corporate hospitals have formed stable consumer groups, public hospitals as non-profit organizations have difficulties in realizing their current development. Not very smooth. And at the end of 2018, it is the period of the company's medical treatment.

In fact, from the above-mentioned merger targets, enterprise hospitals have become the target of capital. For example, Qitaihe Qimei Hospital was established by the Qitaihe General Hospital held by Qiqi Group, and Qiqi Group currently owns 15% of the hospital; Shuangyashan Double Mine Hospital was established by the Shuangyashan General Hospital held by Shuangyu Group. Shuangyuan Group currently owns 15% of the hospital.

An industry veteran pointed out to the 21st Century Business Herald that the pharmaceutical companies can successfully enter the downstream of the pharmaceutical industry and gain the right to speak in the hospital. However, after the hospital is acquired, the pharmaceutical companies are also facing post-investment management. Many problems, how to achieve the expected results after the merger has yet to be explored.