HPV vaccine breakthrough: Bivalent vaccine drops to "milk tea price", while nine-valent vaccine competes for profits
2024-08-13
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The progress of the nine-valent HPV vaccine has once again become "good news" for Wantai Biological.
During trading on August 13, Wantai Biological's share price once rose by more than 8%. At the close, it was reported at 68.19 yuan per share, up 0.84%.
The day before, Wantai Biopharma announced that its nine-valent HPV vaccine would be included in the public list of priority review products by the Center for Drug Evaluation of the National Medical Products Administration. This means that the research and development of its nine-valent HPV vaccine has taken a step forward.
Since the beginning of this year, the price of bivalent HPV vaccine has gradually bottomed out. While the performance of domestic manufacturers has been "injured" by the price reduction of bivalent HPV vaccine, who can take the lead in breaking through with high-priced HPV vaccine has become the focus of the market. At present, the price of Merck's nine-valent HPV vaccine in Beijing community hospitals is 1,323 yuan per dose (including 25 yuan for the second-class vaccination service fee), with sufficient profit margins. The first domestic companies to cross the finish line will have the opportunity to compete with Merck for market space.
Nine-valent HPV vaccine is in the market, and many companies have disclosed their research and development progress this year
This is not the first time that Wantai Biological has updated the development progress of the nine-valent HPV vaccine this year.
In April, Wantai Bio released the unblinding results of the Phase III clinical trial of the nine-valent HPV vaccine. Four months later, on August 12, Wantai Bio announced that the "recombinant human papillomavirus 6/11/16/18/31/33/45/52/58 nine-valent vaccine (Escherichia coli)" jointly developed by the company's wholly-owned subsidiary Xiamen Wantai Canghai Biotechnology Co., Ltd. and Xiamen University was included in the priority review variety public announcement list by the Drug Review Center of the National Medical Products Administration, and the public announcement period is 7 days. If successfully included in the priority review variety public announcement list, it means that Wantai Bio's nine-valent HPV vaccine research and development progress has been further advanced.
According to the Drug Registration Management Measures, after the nine-valent HPV vaccine submits an application for marketing authorization, the National Medical Products Administration will conduct a formal review of the application materials and accept it if it meets the requirements. After acceptance, the National Medical Products Administration will conduct a technical review of the safety, effectiveness, and quality controllability of the accepted drugs as required, and simultaneously conduct production site inspections and pre-market drug production quality management compliance inspections during the period. The National Medical Products Administration will conduct a comprehensive review based on the drug registration application materials, verification results, etc. If the comprehensive review conclusion is passed, the drug will be approved for marketing and a drug registration certificate will be issued.
Wantai Biological also mentioned in this announcement that the nine-valent HPV vaccine will take a relatively long period from submitting an application for marketing authorization to being approved for marketing, and will not have a significant impact on the company's financial condition and operating performance in the short term.
Under the market pressure brought by the expansion of the age of Merck's nine-valent HPV vaccine, domestic manufacturers are accelerating their lead in the high-priced sub-sector. Founder Securities Research Report pointed out that in addition to Merck, Wantai Biological, Kanglewei, Watson Biological's subsidiary Shanghai Zerun, Shanghai Bowei, Ruike Bio, and Yidao Bio are all developing nine-valent HPV vaccines. Wantai Biological, Shanghai Bowei and Kanglewei are the first three companies to start Phase III clinical trials.
In addition to Wantai Bio, other listed companies have also been updating their progress. In May, Watson Bio said in an investor survey that the company's Phase III clinical trial comparing the immunogenicity of the nine-valent HPV vaccine with similar vaccines is in the stage of data statistical analysis and writing clinical research reports. The subsequent research and development work will be carried out in an orderly manner in accordance with regulatory requirements and the company's business plan. The time to market cannot be estimated at present.
At the 2023 performance briefing, Kang Le Wei Shi stated that the Phase III clinical trial of the nine-valent HPV vaccine (female indication) has completed the 24-month visit to the subjects after the first dose, and is conducting 30- and 36-month visits. Most of the subjects have completed the 30-month visit after the first dose. It is expected to submit the BLA (biologics license application) for the nine-valent HPV vaccine (female indication) in 2025.
The price war for bivalent HPV is in full swing, and the performance in the first half of the year has been "hit down"
The sprint in the development of the nine-valent HPV vaccine is also seen by the outside world as a driving force for Wantai Biological's future performance recovery.
The 2024 semi-annual performance forecast released by Wantai Bio shows that during the reporting period, the company's net profit attributable to the parent company's owners is expected to be 240 million yuan to 290 million yuan, a year-on-year decrease of 85.9% to 82.96%.
In the second quarter of this year, Wantai Biological's revenue is expected to be 550 million yuan to 680 million yuan, a year-on-year decrease of approximately 56.93% to 46.75%, and the decline has narrowed compared with the first quarter.
By industry classification, Wantai Biological's main business includes vaccines and in vitro diagnostics. In 2023, the operating income of vaccines and in vitro diagnostics accounted for 71.86% and 27.82% of the total revenue respectively.
Regarding the reasons for the decline in performance, Wantai Bio said that the diagnostics segment benefited from the accelerated advancement of major projects such as assembly lines and cooperation with the top 300 hospitals in China. Excluding the COVID-19 diagnosis-related business, the diagnostics segment's business revenue and profit maintained the growth rate of the first quarter, and overall operation was stable. The main product of the vaccine segment, the bivalent HPV vaccine, continued to be affected by the expansion of the age of the nine-valent HPV vaccine, market competition, and inventory reduction, and sales revenue and profits fell compared with the same period last year.
Currently, the HPV vaccine products approved in China include Merck's nine-valent HPV vaccine, Wantai Biological's bivalent HPV vaccine (Xinkening), GSK's (GlaxoSmithKline) bivalent HPV vaccine (CERVARIX), Shanghai Zerun (a subsidiary of Watson Biological)'s bivalent HPV vaccine (Wozehui) and Merck's quadrivalent HPV vaccine (GARDASIL).
Since 2023, with the continuous advancement of the expansion of the age of the nine-valent HPV vaccine, the survival space of the domestic two-valent HPV vaccine has been compressed, and a price war has been launched in the bidding market. Since the beginning of this year, the price war has continued to escalate, and the price of the two-valent vaccine has been quoted below 100 yuan many times.
In August, the Shandong Provincial Center for Disease Control and Prevention announced the purchase of bivalent human papillomavirus (HPV) vaccines for girls of school age in Shandong Province in 2024. Based on the total bid amount of 27.9465 million yuan and the number of bids of 1.0162 million, a company under Watson Bio won the bid at a unit price of 27.5 yuan per dose, setting a new record for the lowest price of bivalent HPV vaccines. This result is also known as the bivalent HPV vaccine falling to the "milk tea price".
At present, Watson Bio has not yet released its performance for the first half of 2024. However, in 2023, the performance of Wantai Bio and Watson Bio both declined. Among them, Wantai Bio's revenue was halved year-on-year, and its net profit attributable to its parent company fell by more than 70% year-on-year, and Watson Bio's net profit attributable to its parent company also fell by more than 40%.
The price of the two-valent HPV vaccine has been falling, and the competition among major companies is to a certain extent based on the first breakthrough of the high-priced HPV vaccine. However, Shell Finance reporters noticed that Merck's nine-valent HPV vaccine has seen a price reduction in disguise. In January, Merck announced that the two-dose vaccination program of the nine-valent HPV vaccine for females aged 9 to 14 has been approved by the China National Medical Products Administration. The reduction in the number of vaccination doses has also reduced the price of the full vaccination of the vaccine for females aged 9 to 14.
Merck's HPV vaccine sales in China have also encountered challenges this year. Merck's first-half 2024 results show that in the first half of the year, Merck's HPV vaccine revenue was US$4.727 billion, a year-on-year increase of 7% from 14% last year. In the second quarter, Merck's HPV vaccine products achieved revenue of US$2.478 billion, an increase of only 4%.
According to Merck, 60%-70% of the company's HPV vaccine sales come from China. The lower sales growth of HPV vaccines in the first half of the year was mainly due to the decline in sales in the Chinese market, which was mainly due to changes in delivery schedules.
Beijing News Shell Financial Reporter Ding Shuang Editor Wang Jinyu Proofreading Liu Baoqing
