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produced by radar finance | edited by xiao sha | deep sea

the share price of bgi, the leader in genetic sequencing equipment, has been falling.

on september 10, mgi's stock price fell rapidly after the opening, falling more than 3% during the day and 1.5% at the close. the cumulative decline since the beginning of the year has exceeded 55%. in the previous trading day, the company's stock price hit a new low since its listing.

judging from public information, the company has encountered many unfavorable situations since last year. first, mgi's financial performance was poor, and the first half of this year continued the trend of shrinking revenue and profit losses last year; second, the company faces uncertain external risks. the us house of representatives recently passed the "biosafety act", which mentioned mgi and its affiliated company bgi genomics.

in response to the above bill, mgi stated that the company does not collect any genetic data and that the bill contains many factual errors in its accusations against the company. the company hopes that it can be modified or terminated based on the facts before it becomes a formal law.

bgi and bgi genomics are also two listed companies controlled by "gene maniac" wang jian. however, as bgi's share price continues to shrink, bgi's former glory has also quietly faded. the company's performance has stagnated or even reversed in recent years, and its market value has been greatly reduced.

affected by this, wang jian, the chairman of the two companies, had a net worth of 23 billion yuan on the hurun global rich list 2024, less than 31 billion yuan in the previous year.

mgi's stock price hits new low since listing

bgi, whose stock price has been weakening, has suffered another negative blow.

according to media reports, on september 9, us time, the u.s. house of representatives passed a draft legislation numbered hr8333 on the proposed "biosafety act", which intends to restrict the use of funds, loans or subsidies provided by the u.s. government to use certain biotechnology equipment or services provided by designated companies in the performance of government-funded contracts.

analysts believe that the purpose of the bill is to restrict the united states from doing business with a number of chinese biotech companies. the companies included in the restricted list include wuxi apptec, wuxi biologics, bgi, bgi intelligence and its subsidiary complete genomics.

on september 10, mgi released a statement on its official website regarding the us biosafety act. mgi said that this was just a step in the legislative process and did not mean that the bill had become law. there were multiple factual errors in the allegations against the company.

bgi emphasized that the company and complete genomics, as upstream equipment providers in the genetic sequencing industry, do not collect any genetic data. the data generated by customers based on the company's sequencing platform are collected, stored, processed and managed by the customers themselves.

tianyancha app shows that bgi was established in 2016. the company is located in shenzhen, guangdong province, with a registered capital of 370 million yuan. it was listed on the science and technology innovation board in september 2022.

at present, mgi is mainly engaged in the research and development, production and sales of products in the fields of life sciences and biotechnology, such as gene sequencers and laboratory automation-related instruments and equipment, reagents and consumables.

as of the end of june 2024, shenzhen bgi technology holding group co., ltd. and tibet huazhan venture capital co., ltd., controlled by wang jian, held 36.81% and 9.97% of the shares of mgi respectively. wang jian, chairman and co-founder of bgi group, also served as chairman of mgi.

in 2013, before bgi became independent, bgi group acquired the american company complete genomics and obtained sequencer-related technologies. three years later, it spun off the relevant divisions to establish bgi.

since 2019, illumina, a leading company in the gene sequencing industry, has filed patent lawsuits against mgi many times. until 2022, mgi and illumina reached a settlement on all pending lawsuits in the united states. since then, mgi officially entered the u.s. market in january 2023 to sell a full range of sequencing products.

however, since 2023, mgi's performance has not been ideal. according to ifind data from tonghuashun, the company's revenue in 2023 was 2.911 billion yuan, a decrease of 31.19% compared with the same period last year; the net profit attributable to shareholders of the listed company was -607 million yuan, a sharp decrease of 129.98% year-on-year.

in the first half of this year, the company achieved revenue of 1.209 billion yuan, a year-on-year decline of 16.23%; the net profit attributable to shareholders of listed companies was -298 million yuan, compared with a loss of 98.027 million yuan in the same period last year, and the loss increased year-on-year.

regarding the decline in revenue, mgi said that it was due to the influence of various factors such as the macro environment, geopolitics, and market competition. however, in the long run, the company's performance exploded during 2020-2021, which was related to the covid-19 epidemic at the time. as the epidemic prevention and control ended, the company's performance began to "change face".

it is worth mentioning that in the highly watched us market, the company completed the construction of a local factory and put it into operation in the first half of this year to produce gene sequencers, mainly to meet the market demand in the united states and the americas. the financial report shows that in the first half of the year, the company's overseas revenue accounted for 33.75% of the current operating income, of which the us regional business accounted for 5.04%.

regarding the potential impact of the biosafety act, china great intelligence stated in its semi-annual report that as the americas is the region with the largest market size in the global life sciences field, the act has had a negative impact on the united states and some other countries in their choice of the company's products, resulting in the cancellation or postponement of some collaborations.

under the pressure of product sales risks and performance, the stock price of mgi has repeatedly hit new lows. market data shows that in november 2022, shortly after its listing, the company's stock price reached a high of around 148 yuan, but soon entered a downward channel. as of september 10, the closing price was 38.15 yuan, which has fallen by more than 70% from the high point.

"gene maniac" wang jian's wealth shrinks

compared with his two listed companies, wang jian, who is called a "gene madman" by the media, also attracts a lot of attention.

on may 21 this year, the official weibo account of bgi announced that wang jian, co-founder and chairman of bgi group, led the bgi mountaineering team to successfully climb mount everest from the north slope, and transmitted back the world's first ultrasound image and eeg data from the top of the world.

the article stated that this was the second time that 70-year-old wang jian climbed mount everest, breaking the record of the oldest chinese to climb mount everest. this climb to mount everest aims to produce innovative high-altitude scientific research data, deeply analyze the adaptive physiological mechanism of the human body in extremely high altitude areas, and bring new breakthroughs and inspiration to future scientific and industrial development.

climbing mount everest at the age of 70 does not seem to be a big deal for wang jian, whose goal is to live to 120. according to media reports, wang jian has never concealed his desire for "immortality". living to 120 is just a small goal for him. he has repeatedly stated that genetic technology will eventually enable humans to achieve immortality.

born in huaihua city, hunan province in 1954, wang jian once experienced a difficult life. in 1968, when he was 14 years old and had not yet graduated from junior high school, he went to the remote mountainous area of ​​xiangxi, hunan province. he was hungry and once ran to the granary to "steal rice" and even caught mice to satisfy his hungry stomach.

this period of poverty became one of the driving forces for wang jian's future struggles. in a later talk show, he admitted that mental pain was nothing compared to physical pain.

fortunately, as a worker-peasant-soldier student, wang jian had the opportunity to study at xiangya medical college (now xiangya medical college of central south university). after graduation, he went to beijing university of chinese medicine to study for a master's degree. in 1988, he went to the united states and did research at the university of texas and the university of washington.

wang jian said that the first 30 years of his life can be summarized as survival, learning, and studying abroad. it was during his study abroad that he began to have an in-depth understanding of genetic technology.

in 1994, wang jian returned to china and founded gbi biotechnology (beijing) co., ltd. in 1999, in order to undertake the task of the human genome project, he led the establishment of beijing bgi gene research center (the predecessor of "bgi group").

during the sars outbreak in 2003, bgi was the first private institution to crack the genome of a virus sample. in 2007, 53-year-old wang jian led the team to shenzhen and founded the shenzhen bgi genomics institute, gradually transforming research results into technology and products.

in 2017, wang jian pushed bgi to list on the chinext. the company was then known as the "tencent of genetic testing" and was highly anticipated by investors.four months after its listing, bgi’s stock price rose from the issue price of 13.64 yuan to over 250 yuan, and its market value exceeded 100 billion yuan. wang jian also reached the pinnacle of wealth.

however, on the other side of his glory, wang jian is also accompanied by controversy. the beijing news once reported that he was angrily criticized by fang zhouzi for opposing women's hpv (cervical cancer prevention) vaccination. he also aroused doubts from many medical practitioners because he did not allow his employees to place stents (heart bypass).

in december 2022, wang deming, who was once the deputy director of the huaxia ark national gene bank, was beaten for reporting the nucleic acid testing problems of bgi under his real name. subsequently, bgi issued another statement, claiming that wang deming had maliciously slandered him.

today, wang jian, who has built his own "gene empire", is still active in corporate management, but his personal wealth has been reduced due to the performance of the two companies. in the 2024 hurun global rich list, wang jian's net worth is 23 billion yuan, less than 31 billion yuan in the previous year.

bgi's revenue and net profit both fell

the main business of bgi, owned by wang jian, is to provide research services and comprehensive solutions for precision medicine testing to scientific research institutions, medical institutions, etc. through technical means such as genetic testing, mass spectrometry testing, and bioinformatics analysis.

in the gene sequencing industry chain, compared with bgi, which is in the upstream and mainly deals in instruments, equipment, reagents and consumables, bgi is in the middle stream and mainly provides gene testing services. but what is similar is that in terms of performance, as the impact of the public health incident fades, bgi is no longer in the spotlight.

the financial report shows that in 2023, bgi's operating income will be approximately 4.35 billion yuan, a year-on-year decrease of 38.33%; the corresponding net profit attributable to the parent company will be approximately 92.9004 million yuan, a year-on-year decrease of 88.43%.

the company said that due to the impact of the industry cycle, the company's related testing business revenue has declined significantly. this is the third consecutive year that bgi's net profit has declined. from 2020 to 2022, the company's net profit attributable to the parent company was approximately 2.09 billion yuan, 1.462 billion yuan, and 803 million yuan, respectively.

specifically, in 2023, bgi's infection prevention and control business achieved operating income of 516 million yuan, a year-on-year decrease of 77.59%, mainly due to the sharp decline in operating income caused by public health emergencies; during the same period, the company's precision medicine testing comprehensive solution business revenue decreased by 43.95% year-on-year, mainly due to the sharp decline in revenue caused by the decline in related testing demand after the end of the public health emergency.

in the first half of 2024, bgi's performance continued to decline. during the period, the company achieved operating income of 1.871 billion yuan, a year-on-year decrease of 9.67%; the corresponding attributable net profit was 18.1998 million yuan, a year-on-year decrease of 63.45%.

according to analysis, in addition to the sharp drop in domestic demand for infection testing, the slowdown in business growth in some overseas markets is also an important factor leading to the decline in bgi's revenue.

according to ifind data from tonghuashun, in the first half of this year, except for the growth in the chinese mainland market, bgi's revenue in other markets in asia (including hong kong, macao and taiwan), oceania, europe, africa and south america all declined year-on-year.

in addition, the company said at the performance briefing that due to the economic downturn, the collection period of major customers such as scientific research institutes, hospitals and governments has been extended. as a result, the company's accounts receivable increased in the first half of the year, and a credit impairment loss of 58.184 million yuan was recorded.

some market insiders believe that after the benefits of the epidemic disappeared, the results delivered by bgi were not ideal.

due to insufficient performance support, bgi's stock price has been falling. its current market value is only about 14.5 billion yuan, less than one-seventh of its peak period.