Jiuzhou Pharmaceutical (603456) Important Issues Comment-Release of Suzhou Novartis Pricing Details Waiting for Corresponding Acquisition
Jiuzhou’s discounted acquisition of Novartis Suzhou reflects mutual benefit and win-win cooperation, which strengthens the market’s confidence in the transaction; Nuoxinto’s successful entry into the 2019 national medical insurance drug catalogue will help accelerate the volume of products and promoteJiuzhou’s demand for APIs and increase the company’s performance, maintaining the “Buy” rating.
The company announced the pricing basis for the acquisition of Suzhou Novartis.
According to the company announcement, after the audit, the target company Suzhou Novartis’ long-term assets after the divestiture of technology and drug development assets were 6.
5.9 billion, inventory is 2.
64 ppm, net other operating assets-0.
3.9 billion, for a total of 8.
At the same time, the subject company borrowed from related parties NovartisPharma AG’s production and operation6.
310,000 yuan, after the parties to the transaction, the company only needs to bear 5.
37 trillion, finally get the underlying transaction price.
37) = 7.
90], consistent with the democratic forecast price, the final transaction price may still be adjusted according to the situation of the target company on the delivery date.
The acquisition of high-quality assets at a discount represents a win-win cooperation, and the favorable transaction and certainty have been enhanced.
The temporary market has potential doubts on the pricing of the acquisition. The issue is not enough to maintain the expected price and the confidence in landing. The price will be maintained after the audit and negotiation with the counterparty to strengthen the market’s confidence in the acquisition.
We believe that Novartis Group can accept the company at a discount (value-added ratio -10).
69%) Suzhou Novartis related assets are mainly based on the recognition that Jiuzhou Pharmaceuticals has demonstrated its quality and quantity, continuous and stable API and intermediate production capacity in the process of gradually supplying Novintoto key intermediate C8.In the context of the heavy product Nuoxin’s expected volume and high-quality API manufacturers’ short-term hard to find food, they hope to continue to ensure a stable supply of follow-up APIs and intermediates and reach long-term cooperation. Novartis also invested 20 million to retain employees.
The two sides are mutually beneficial and win-win cooperation.
Nuoxinto successfully entered the category B of medical insurance, promoted the acceleration of volume and increased the performance of Jiuzhou.
On November 28, 2019, the National Medical Insurance Bureau released the “National Basic Medical Insurance, Occupational Injury Insurance and Newborn Insurance Drugs Catalog (2019 Edition)” Class B scope, of which Novinto successfully entered the 2019 version of the National Medical Insurance medicines through this round of medical insurance negotiationstable of Contents.
According to data from the Chinese Hypertension Survey (CHS), currently residents aged 35 and above are implanted with central debilitating disease.
3%, that is, the number of patients is as high as 13.7 million, and Novozymes has only benefited about 700,000 patients since it was first approved by the State Food and Drug Administration in 2017. The patient’s ability to pay is a major factor affecting its volume.
We believe that under the huge market demand in China and the blessing of medical insurance, Nuoxin properly promotes accelerated volume expansion, slender 杭州风月网 demand for the company’s APIs, and thickening the company’s performance is worth looking forward to.
Mergers and acquisitions, the integration is lower than expected, the number of orders has grown less than expected, and intensified competition has led to lower order prices, policy risks, and exchange rate risk.
The company’s existing CDMO and API business is developing steadily, and it intends to achieve leapfrog development of CDMO through the acquisition of Suzhou Novartis.
We maintain the completion of the acquisition of Suzhou Novartis by the end of this year, and start to realize the restructuring and consolidation expectations in 2020, maintaining the company’s 2019?
0 in 2021.
EPS forecast of 80 yuan, maintaining a target price of 17.
15 yuan and “Buy” rating.