As an unprofitable pharmaceutical company, Kangle Guardian can be described as an "old player" in the capital market, which has been listed on the Beijing Stock Exchange and has introduced multiple rounds of financing during the period.
Highlights:
The fastest growing trivalent HPV vaccine in Healthguard's pipeline is expected to submit a marketing application in China by the end of the year.
At least 6 vaccine companies have entered the third phase of clinical trials of the 9-valent HPV vaccine under development, and it is still unknown whether Kangle Guardian can quickly come out of the line.
This article was written by Molly.
Since the opening of the Beijing ** Stock Exchange in September 2021, there has not been a single company listed on the Hong Kong stock market and the Beijing Stock Exchange at the same time. At the end of January, the vaccine industry was deeply cultivatedBeijing Kangle Guardian Biotechnology Co., Ltd. ***(833575.BJ) to the Hong Kong Stock ExchangeListing application documents, committed to becoming the first "North + H" listed company.
Health Guardian is a clinical-stage vaccine developer with a broad portfolio of HPV vaccines, focusing on recombinant protein vaccines, and an mRNA vaccine in development but not commercialized. Among the pipelines of Health Guard, the fastest progress is a trivalent HPV vaccine, which is expected to submit a biologics license application (BLA) in China by the end of this year, and another blockbuster product, the 9-valent HPV vaccine, is expected to be submitted to BLA in China and Indonesia in 2025, and this 9-valent vaccine is also the first domestic 9-valent HPV vaccine to carry out clinical trials for male indications in China.
In addition, Kangle Guardian has also cooperated with Chengda Biotechnology to develop the 15-valent HPV vaccine, which is the HPV vaccine with the highest price among the HPV vaccines that have been approved for clinical trials in the world, covering all high-risk HPV types defined by the WHO Cancer Research Institute, and is expected to increase the prevention rate of cervical cancer to more than 96%, and the vaccine is expected to start clinical phase I trials this year.
Kangle Guardian also has a bivalent** HPV vaccine, which uses mRNA vaccine technology route. In addition to HPV vaccines, Connaught Guardian has five vaccines against respiratory syncytial virus (RSV), varicella-zoster virus, hand, foot and mouth disease and other diseases with medical needs, all of which are in the preclinical stage and have uncertain commercialization prospects.
As a pre-profit pharmaceutical company, Kangle Guard, which was incorporated in 2008, can be described as an "old player" in the capital market. In September 2015, Kangle Guardian was listed on the stock market, and then carried out four rounds of private placement in 2019, 2020 and 2021, with a total amount of more than 1.7 billion yuan, and the shareholders introduced included Yuanwang**, Yunfeng**, Dongfang Fuhai and other industries**.
In September 2021, after the opening of the Beijing Stock Exchange, which mainly serves small and medium-sized enterprises, it attracted the attention of Kangle Guard, and in February 2022, the company announced plans to list on the Beijing Stock Exchange at an estimated issue price of 7768 yuan, and the number of shares to be issued does not exceed 44.53 million shares. A year later, in March 2023, Kangle Guardian finally successfully landed on the Beijing Stock Exchange and became the "first share of human vaccine" on the Beijing Stock Exchange, but the issue price has been lowered to 42 yuan per share, and the issue size has shrunk to 7 million shares. Even so, Kangle Guardian broke on the first day of listing on the Beijing Stock Exchange, falling by 154%。
After the announcement of the sprint to the Hong Kong Stock Exchange, the sluggish stock price of Kangle Guardian was **31%, but the next two days were **12% and 78%, which wiped out all the gains brought by the good news. This means that rational investors are not very optimistic about the long-term development of Kangle Guard.
The involution of HPV vaccine has intensified
Due to its large population and stable economic development, China became the world's second-largest vaccine market in 2022, accounting for 36% of the global market3%。According to the report cited in the prospectus, driven by the increasing availability of innovative vaccines, favorable policies, vaccine technology innovation and increasing awareness of vaccination, China's vaccine market grew at a compound growth rate of 32% from 2017 to 2022, reaching 125.1 billion yuan.
Among them, HPV vaccine, which is a preventive vaccine for cervical cancer, has a huge market. As of 2022, the cumulative vaccination rate of women aged 9 to 45 in China is low at only 936%。The report argues that by 2031, cumulative vaccination rates for women aged 9 to 45 and men are expected to reach 57% and 7, respectively6%, China's HPV vaccine market size is also expected to reach 73 billion yuan.
At present, a total of five HPV vaccines have been approved for marketing in China, and the first three on the market were imported products until 2019Wantai Bio(603392.SH) bivalent vaccine Xinchonine became the first approved domestic HPV vaccine, thus opening the era of domestic HPV vaccines, March 2022Watson Biotech(300142.SZ) bivalent vaccine has also been approved. In order to gain a larger market, the domestic bivalent HPV vaccine has begun to fight, in August last year, in the first procurement of Guangdong Province, Wantai Bio's Xinkonin single dose ** has dropped to 116 yuan, while Walvax Biotech has failed to be selected with a single dose of 146 yuan.
Although the 9-valent HPV vaccine, which provides a wider range of protection, has a broader market, the domestic 9-valent vaccine will also usher in fierce competition in the future. In addition to Kangle Guard, Wantai Biological, Watson Biological, Shanghai Bowei,Recbio(2179.HK) and other vaccine manufacturers have also entered the phase III clinical trial stage, in addition to a number of 11-valent and 12-valent HPV vaccines to join the competition. As a vaccine manufacturer that has no commercial capability, can Kangle Guardian have an advantage in this fierce involution?
For Connaught Guard, the current situation is even more serious is the lack of funds on hand. As of the end of September last year, the company's cash holdings had increased from 8.0% in the same period in 20222.6 billion yuan to 25.3 billion yuan, while in the first three quarters of 2021, 2022 and 2023, its net loss reached 3800 million yuan, 29.3 billion yuan and 22.5 billion yuan.
However, the prospectus revealed that the company had obtained additional bank financing in December 2023 and January 2024, with 3$2.8 billion in unused bank financing. At present, the price-to-book ratio of Kangle Guardian is about 5 times, and the price-to-book ratio of Recbio, an unprofitable vaccine stock listed on the Hong Kong Stock Exchange, is only 3 times, indicating that Hong Kong stock investors tend to be conservative in valuing such companies. Whether Kangle Guardian can break through in the fierce HPV vaccine market still needs time to prove.