Industry Views
After reviewing the development of the epidemic in overseas markets, antigen detection products have a wide range of application scenarios, and the demand side may continue to exceed expectations. New crown antigen self-test products have been widely used in European countries since 2021, and are an important detection method in epidemic prevention and control. In February 2021, Germany took the lead in introducing the relevant approval system, and then Austria, France, Belgium, the Netherlands and other countries launched the whitelist channel for antigen test access. At the end of 2021, Omicron became popular overseas, and the epidemic rebounded in the United States, Australia, Japan and other countries. Antigen self-test products were used for epidemic prevention, and the demand for products increased rapidly.China is one of the major producers of antigen testing products. Domestic companies are actively responding to overseas demand and rapidly increasing production capacity. According to data from China Customs, the export of antigen products in December 2021 will increase by 146% month-on-month.performanceachieve a breakthrough. At present, as the incidence of Omicron overseas has stabilized and the amount of testing has declined, we expect that the relationship between supply, demand, quantity and price will stabilize in the future; antigen testing products have gradually been adopted by many countries, and the demand may continue to exceed expectations.
New crown drugs may be used in combination with antigen detection, and antigen products may become a normal demand in epidemic prevention and control.
On March 1, 2022, US President Biden mentioned in his State of the Union address that he plans to launch a “test and treat” program, that is, people can be tested in pharmacies and if they are positive, they can get antiviral drugs for free on the spot. We believe that if this plan is advanced in the United States, antigen testing may become a normal demand product for future epidemic prevention, and relevant manufacturers in the United States that obtain FDA EUA may obtain more sustainable orders. As of March 6, 2022, there are 13 OTC antigen testing products and 5 professional antigen testing products, of which many domestic companies are involved in OTC products.
Antigen self-testing helps prevent and control the epidemic in Hong Kong. On March 5, 2022, Hong Kong reported 37,529 new crown testing cases. Since December 31, 2019, the cumulative number of cases has exceeded 440,000. In order to achieve the goals of early detection, early isolation and early treatment, the Hong Kong government is procuring a large number of rapid antigen test kits for testing by different groups of people, so as to identify patients as soon as possible and cut off the virus transmission chain. Rapid antigen testing needs to combine the results of clinical diagnosis and other laboratory tests to complete the proposed qualitative detection of antigens in samples from suspected infected persons. Hong Kong citizens can purchase rapid antigen test kits from market retailers for voluntary testing. At the same time, the government provides free rapid antigen test kits to designated high-risk and specific groups and those living in safety against the epidemic.Brands of antigen kits distributed by the government to designated groups for free include:Yahuilong、Hot View Creatures、Wanfu Bio、AbbottThere are 9 domestic and foreign enterprises.
Investment Advice
The Omicron virus is highly contagious, and there is still uncertainty about the future mutation of the new coronavirus. For example, if the US market is widely used to treat the new crown drug and test, we expect that the demand for antigen self-testing products may change from emergency demand to normal demand; at the same time, in the future Home-based testing for COVID-19 antigen may see further widespread adoption in other regions of the world. Under the above circumstances, the performance of new crown antigen detection products may continue to exceed expectations, and relevant companies may continue to benefit.
Key companies:Oriental creatures、Wanfu Bio、Anxu Biology、Boto Bio、YahuilongWait.
risk warning
The risk of product price reduction due to fierce competition in the industry, the risk of unqualified product quality control, and the risk of declining demand brought about by the improvement of the epidemic situation, etc.
(Article Source:Sinolink Securities）