Home News The mainland’s new anti-epidemic regulations highlight nucleic acid chaos and corporate profits | relax nucleic acid | long queues | shut down nucleic acid sites

The mainland’s new anti-epidemic regulations highlight nucleic acid chaos and corporate profits | relax nucleic acid | long queues | shut down nucleic acid sites

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The mainland’s new anti-epidemic regulations highlight nucleic acid chaos and corporate profits | relax nucleic acid | long queues | shut down nucleic acid sites

[The Epoch Times, December 05, 2022](Comprehensive report by Epoch Times reporter Fang Xiao) Recently, new policies have been intensively introduced across the mainland to reduce the scope and frequency of nucleic acid testing. Nucleic acid testing sites have been shut down on a large scale in many cities, but health codes and green codes are still checked in public places, causing people to wonder where to go for nucleic acid testing. In addition, the huge profits of nucleic acid testing companies have been questioned, and related companies have been accused of “making money for the country”.

While “unnecessary and non-essential to do nucleic acid”, people queued up in the cold wind

Recently, Chengdu, Beijing, Shenzhen, and Chongqing have successively issued new epidemic prevention regulations, advising citizens not to do nucleic acid if it is not necessary, which is regarded as a signal of “gradual liberalization”.

But so far, most cities such as Beijing and Shanghai have not completely given up nucleic acid screening. The outbreaks in Beijing and Shanghai are still spreading.

According to Beijing’s official requirements, people entering and returning to Beijing must strictly implement the “three-day inspection” requirement, the time for citizens to enter public places to check the negative nucleic acid certificate has been adjusted from 72 hours to 48 hours, and the frequency of nucleic acid testing has changed from “three-day inspection” to “Check every two days”.

From December 3, Shenzhen citizens will no longer check nucleic acid test certificates when entering public places such as pharmacies, parks, botanical gardens, and outdoor tourist attractions, but they still need to scan the venue code and check the green health code.

Shanghai officials require that from 00:00 on November 29, consumers who enter Shanghai catering services (including bars), shopping centers (including department stores), supermarkets, vegetable markets, beauty salons, and (foot) baths and other commercial places , must hold a negative nucleic acid test certificate within 48 hours.

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Since last week, social testing stations and many community testing stations in Beijing have been shut down, and many vacant testing booths have also been hoisted away from their original sites, which once became a hot topic on the Chinese Internet. Many Beijingers suddenly discovered that there is no nucleic acid testing kiosk within a 15-minute walk. Beginning on December 4, Beijing quickly restored these testing stations in an attempt to quell the powerful public grievances that pervade the city.

Shijiazhuang, Hebei, and Guangzhou, Guangdong also caused chaos due to the rapid removal of social nucleic acid testing points, which caused strong complaints from the public.

China News Weekly” reported on the 4th that from Beijing to Chengdu, in the cold winter wind, the queues for nucleic acid testing in many cities are getting longer and longer. After the originally densely distributed nucleic acid testing points were quickly shut down in a large area, where to do nucleic acid has become a tormenting problem.

A senior practitioner in the field of in vitro diagnostics (IVD) said that the industry predicts that large-scale nucleic acid testing may end, but it is not 100% sure.

The surge in net profit of nucleic acid-related companies has been questioned as “failing to make money for the country”

Since the outbreak of the new crown epidemic, the chaos in nucleic acid testing has been repeatedly exposed, and the huge profits of nucleic acid-related companies have also been disclosed by the media many times.

According to reports, in early 2020, when nucleic acid testing was first proposed, the price of third-party testing was as high as 200 yuan (RMB, the same below) per person.

How to reduce the cost of nucleic acid testing has attracted much attention. In April 2020, Hubei launched a centralized procurement of new coronavirus detection kits, with the lowest winning bid price of 16.78 yuan and the highest price of 24.99 yuan. The maximum price limit for testing services is 180 yuan per person.

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After the price reduction, the profit of nucleic acid testing by third-party testing agencies can still reach about 155 yuan per person.

At present, the mixed pipe detection in most areas is free, and the government pays for it. And apheresis generally needs to be paid by individuals, and the price is about 15 to 20 yuan, which is slightly different from place to place.

According to Tianyancha, since January 1, 2020, more than 24,500 companies with “medical testing” in their name or business scope have been registered and established.

With the implementation of normalized nucleic acid testing this year, news frequently broke out that some nucleic acid testing agencies falsified data, judged negative as positive, and then triggered a larger testing range, allowing more people to participate in testing, and finally making money from it.

In the past six months or so, people in some areas who have not completed normal nucleic acid testing within the time limit will be given yellow codes and red codes and will be restricted from traveling.

People continue to question, how profitable is nucleic acid testing? And who is making money?

There are many listed companies engaged in testing business in China. The leader of the testing business is Dean Diagnostics. From the company’s financial report, it can be seen that the gross profit margin of the testing part in the first half of the year was about 50%. However, China‘s new energy car companies have a gross profit margin of only about 10%.

After more than half a year of normalized testing, according to statistics from the National In Vitro Diagnostic Network, as of October this year, the State Food and Drug Administration of the Communist Party of China has approved 41 new crown nucleic acid detection reagents for listing. There are also more than 30 production enterprises and hundreds of third-party medical inspection institutions.

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Flush iFinD data shows that there are currently 109 listed companies related to “new crown detection”. The total net profit of these companies in 2021 is 74.098 billion yuan.

According to “China News Weekly”, the fate of many companies has been rewritten by the new crown epidemic. Jiuan Medical, which originally sold a series of blood pressure monitors and blood glucose meters, saw its operating income increase by 30.1 times year-on-year in the first three quarters of this year, and its net profit attributable to the parent company increased by 319.2 times year-on-year. According to the company’s announcement, the high performance growth was mainly due to the substantial increase in sales of the new crown kits.

The revenue data of several companies providing nucleic acid testing services followed closely behind. Listed companies such as Mingde Biology, Daan Gene, Cape Bio, Shuoshi Bio, Lanwei Medicine, KingMed Medicine, Dean Diagnostics, and Pony Testing have also maintained at least double-digit revenue growth.

Other companies related to nucleic acid testing have also accelerated the pace of listing. As of November 24, a total of 5 companies related to “new crown detection” have passed the initial public offering (IPO) meeting this year. The gross profit margins of these five passing companies will increase significantly after 2020, and their net profits will exceed 100 million yuan.

As the performance of related companies has risen all the way, on the contrary, there are more and more doubts in the society. Companies related to nucleic acid testing were accused of “making money in the country’s troubles and swaggering through the market.”

Responsible editor: Lin Congwen#

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