FINANCIAL PERFORMANCE

Amid the unfavourable trading environment in 2023, the tenacity, resilience and solidarity are factors that enabled the Group to weather the head winds and managed to turn in satisfactory performances. The Group achieved sales revenue of approximately HK$1,706.6 million, representing an increase of 29.5% (or approximately RMB1,541.7 million, representing an increase of 36.2%) as compared to last year, which were contributed especially from Beifushu^® unit-dose eye drops, Beifuxin® gel and 適麗順^®(lodized Lecithin Capsules). The Group achieved a net profit of approximately HK$275.3 million, representing an increase of22.1% (or approximately RMB248.7 million, representing an increase of 28.4%) as compared to last year, which was exceptionally weighed down by the withholding tax incurred.

The Group's turnover is primarily made up of the ophthalmology segment ("Ophthalmology") and surgical (wound care and healing) segment ("Surgical"). The core products that are current growth drivers under each segment are:

1. Ophthalmology - Beifushu^® series (Beifushu^® eye drops, Beifushu^® eye gel and Beifushu® unit-dose eye drops), Tobramycin Eye Drops, Levofloxacin Eye Drops, Sodium Hyaluronate Eye Drops and 適麗順®(lodized Lecithin Capsules); and

2. Surgical (wound care and healing) - Beifuji^® series (Beifuji^® spray, Beifuji^® lyophilised powder and Beifuxin® gel), Carisolv^® dental caries removal gel, 伢典醫生(Dr.YaDian) mouth wash, 伊血安顆粒(Yi Xue An Granules) and PELNAC™ collagen-based artificial dermis.

The sectoral turnover of Ophthalmology and Surgical is approximately 44.1% and 55.9% of the Group's turnover, respectively. The combined turnover of the Group's flagship biologics, Beifushu^® series and Beifuji^® series (the basic fibroblast growth factor (bFGF) based biologic drugs), represented about 86.8% of the Group's total turnover, of which Beifushu^® series and Beifuji^® series accounted for 33.1% and 53.7% of the Group's turnover, respectively. The remaining 13.2% of the Group's turnover is mainly contributed by sales of Tobramycin Eye Drops, Levofloxacin Eye Drops, Sodium Hyaluronate Eye Drops, 適麗順^® (lodized Lecithin Capsules), Carisolv^® dental caries removal gel, 伢典醫生(Dr.YaDian) mouth wash, 伊血安顆粒(YiXue An Granules) and PELNAC™ collagen-based artificial dermis, collectively.

Ophthalmology contributed approximately HK$753.4 million to the Group's turnover for the year ended31 December 2023, representing an increase of 36.1% as compared to 2022. Surgical recorded a total turnover of approximately HK$953.2 million for the year ended 31 December 2023, representing an increase of 24.7% as compared to 2022. The increase was attributable to the resumption of clinical operations of hospitals to normalcy in the PRC.

As at 31 December 2023, the Group had cash and cash equivalents of approximately HK$509.8 million (2022: approximately HK$543.5 million).
 
SIGNIFICANT BUSINESS DEVELOPMENT ACTIVITIES

During the year under review, the expansion of production capacity has progressed well. The second gel manufacturing line and the new freeze-drying (lyophilise) manufacturing have been successfully commissioned and have passed the Good Manufacturing Practices (GMP) approval, and two additional manufacturing lines have been officially put into production. The core functional modules of the second phase of the quality management system (QMS) have been officially launched, taking digitalisation, informatisation and intelligence to a new level in quality control.

Research and development ("R&D") innovation continues to progress, with multiple pipelines advancing smoothly, and the global phase 3 clinical project of bevacizumab ophthalmic injection (EB12-20145P) has successfully enrolled patients in the PRC, Australia, European Union countries and the United States.

In addition, this year has been a fruitful year in promoting product diversification. We have obtained the exclusive agency rights for Osteopore's innovative oral and maxillofacial products in Singapore, and released high-end home phototherapy brands 佩特^®(PAINT) and 艾視優加^®(EYESU+) dry eye care products. The business of medical devices such as FarFlex series of elastic bandages, PELNAC™ absorbable dressings,野光源(Wlight) eye adjustment training lights, etc. is of sound development. Furthermore, the new business segments of the Group have also made several breakthroughs. 全一醫療(珠海)有限公司(UNO Medical(Zhuhai) Company Limited*), a wholly-owned subsidiary of the Company, and 深圳帝邁生物技術有限公司(Shenzhen Dymind Biotechnology Co., Ltd.) ("Dymind") have reached a strategic cooperation to jointly build an industry-leading digital cloud inspection platform, "帝一雲檢" (Diyi Cloud Inspection), for the point-of-care testing (POCT) equipment of Dymind.

The Group's development achievements have also been well recognised in the industry, and have been endorsed with awards and accolades.珠海億勝生物製藥有限公司(Zhuhai Essex Bio-Pharmaceutical Company Limited), a wholly-owned subsidiary of the Company, was once again being recognised as one of the 2022年度TOP100中國化藥企業(2022 Top 100Chemical Pharmaceutical Companies in the PRC), Beifushu^® was being recognised as one of the Chinese reputable medicine brands for five consecutive years, and Beifuxin^® gel won the2023年年度生化生物企業優秀品牌(2023Excellent Brand of Biochemical and Biological Enterprise).
 
MARKET DEVELOPMENT

As at 31 December 2023, the Group maintained a network of 43 regional sales offices in the PRC with more than 1,260 sales and marketing representatives. In addition, the Group has maintained a base in Singapore for market access into Southeast Asian countries since 2020.

For achieving a sustainable growth traction for the Group's current and future products, the Group has been relentlessly making investments to improve its competitiveness and widening its customer base under the following plans:
 

• investing in clinical observation programmes for affirming additional clinical indications of its commercialised products;
• reaching out to market in lower-tier cities in the PRC;
• cultivating pharmaceutical stores, where possible, as a complementary sales channel; and
• nurturing of e-consultation and e-prescription for patients with chronic diseases under its healthtech e-platform.

During the year under review, the Group's therapeutic products are being prescribed in more than 12,500 hospitals and medical providers, coupled with approximately 1,800 pharmaceutical stores, which are widely located in the major cities, provinces and county cities in the PRC.
 

RESEARCH AND DEVELOPMENT

The R&D's vision is emphasising the dedication to science and innovation, with a mission to develop therapeutics that would meet unmet clinical and/or commercial needs. The Group kick-started a 5-year development plan from 2021 to further strengthen its R&D capability and its position in ophthalmology.

The Group's key R&D initiatives comprise of growth factor, antibody (i.e. mAb, bsAb, sdAb, scFv, ADC/FDC, etc.), drug formulation know-how and Blow-Fill-Seal ("BFS”) platform. Growth factor, antibody and drug formulation know-how are used for the development of therapeutic drugs in ophthalmology, surgical (wound care and healing) and oncology, whereas BFS platform is a state-of-the-art manufacturing facility for producing preservative-free unit-dose drugs, in particular for ophthalmic drugs.

As at the date of this report, there are16 R&D programmes in the pre-clinical to clinical stage, out of which 4 ophthalmology programmes are in clinical stage. The 4 ophthalmology programmes listed below are targeted as mid-term growth driver:

1. EB11-18136P: SkQ1 eye drops, second phase 3 clinical trial (United States Food and Drug Administration (the “US FDA")) (VISTA-2) topline data released on 24 February 2021.The continuation of the VISTA programme is subject to the completion of the transfer of chemistry, manufacturing and controls (CMC), know-how and intellectual property rights relating to SkQ1 from Mitotech S.A.. following the acquisition on 13 October 2022.
2. EB11-15120P: Azithromycin eye drops, ongoing review by external key opinion leaders (National Medical Products Administration (“NMPA") in the PRC)
3. EB12-20145P: Bevacizumab intravitreal injection for exudative (wet) age-related macular degeneration,       phase 3 clinical trial (US FDA, European Medicines Agency, Therapeutic Goods Administration and NMPA in the PRC)
4. EB11-21148P: Cyclosporine eye drops, phase 2 clinical trial (NMPA in the PRC)  

As at the date of this report, the Group has obtained a total of 84 patent certificates or authorisation letters, which include 63發明專利(invention patents),14實用新型專利(utility model patents) and 7 外觀專利(design patents).

The Group currently has diversified its R&D resources to multiple research sites in Zhuhai (PRC), Boston (United States), London (United Kingdom) and Singapore which support not only our pursuit of new therapeutics but also our acquisition of global talent.

 
PROSPECTS

Barring unforeseen circumstances, the Group remains focused on executing its plans and delivering progressive results.
 
DIVIDEND

To reward our valued shareholders, the Board is pleased to propose a final dividend of HK$0.045(2022: HK$0.025) per ordinary share to be approved at the upcoming annual general meeting of the Company. Together with the interim dividend of HK$0.045 per ordinary share which was paid on 13 September 2023, the total dividend for 2023 would be HK$0.09(2022: HK$0.065) per ordinary share.
 
APPRECIATION

I would like to take this opportunity to express my sincere gratitude to all stakeholders, business associates and valued customers for the trust, support and cooperation accorded to us, and each and every member of the Group for their relentless efforts rendered in shaping the Group into being a progressive and promising pharmaceutical player.
 
 

Ngiam Mia Je Patrick
Chairman
 
Hong Kong
18 March 2024

* For identification purpose only