According to data from the financial data service provider, Tonghuashun, nearly half of the listed pharmaceutical companies in China are expected to incur losses in 2024, with a total loss exceeding 30 billion yuan. Among them, at least 47 companies are experiencing losses for the first time since their initial public offering.
As of February 5th, out of the 260 listed pharmaceutical companies in China, 257 have already released performance forecasts. Among them, 121 companies are expecting losses, with a combined estimated amount exceeding 30 billion yuan. This indicates that close to half of the pharmaceutical enterprises that have issued forecasts are facing losses.
Even industry-leading companies in the pharmaceutical sector such as BGI Genomics, Luye Pharma, and Huarun Pharmacy have reported losses. At least 47 companies have incurred losses for the first time since going public.
On February 8th, a report from Observer Network revealed that Luye Pharma’s performance forecast suggested a net loss of approximately 600 million to 800 million yuan in 2024, representing a year-on-year decrease of 159.16% to 144.37%. This marks the first year of losses for the company since its listing. BGI Genomics anticipates a net loss of 0.75 to 0.92 billion yuan last year, while the company’s profit in the previous year was only 92.74 million yuan, making the loss tenfold the previous year’s profit.
Huarun Pharmacy projects a loss ranging from 1.18 billion to 1.38 billion yuan, with a staggering year-on-year decline of 727.45% to 833.8%. In just one year, the company has lost all of its net profits accumulated over the past 13 years since its listing.
Announcements from several companies attributing their losses to factors such as rising costs, reduced profits, payment difficulties, and impairment recognition due to nearing expiration of drug inventory have been made public.
In addition to the loss-making enterprises, over 110 profitable companies have also recorded a significant decline in net profits. For instance, the long-standing pharmaceutical company, Tonghua Dongbao, estimates a net profit of 40.52 million yuan in 2024, down by 96.53% compared to the previous year. Shanghai Yizhong’s net profit is expected to be only 8 to 10 million yuan, a decrease of 93.81% to 95.05%.
Overall, the pharmaceutical industry in China faced mounting pressure in 2024. Data released by the National Bureau of Statistics of China on January 27th showed that while the revenue of the pharmaceutical manufacturing industry remained stable compared to the previous year, operating costs increased by 2%, leading to a 1.1% overall decline in total profits.