A rising star in China’s biotech industry is now raising concerns about the country’s ability to produce its own vaccines.
Chongqing Zhifei Biological has halted the production of its own meningitis vaccine AC-Hib, the company announced last week – a move that may keep investors at bay.
The company’s previous license to produce the vaccine expired April 1, and it has yet to receive a new one, despite having applied for renewal in November, according to the company’s official statement.
Regulations stipulate that a company needs to apply for a license once every five years in order to produce a vaccine, and Zhifei’s last approval for AC-Hib came in 2014. It is not clear if its license’s renewal this time around has been postponed or rejected.
Zhifei still sells HPV vaccines developed by global giant MSD, with which it shares revenues for China sales, but the AC-Hib has been a major revenue channel for the company.
Industry watchers say Zhifei’s case signals the increasingly tight supervision of vaccine production after scandals caused nationwide concern. Last year, Changsheng Bio-Technology caused outrage after it was found to have produced and sold roughly 500,000 substandard vaccines for babies.
Zhifei booked a total 2018 revenue of 5.2 billion yuan ($744 million), up 289.4% year-on-year. And the company’s net profit climbed 235.8% to 1.5 billion yuan for the same period.
But even strong overall performance may not reassure investors – an 8 billion yuan market value of the company's stock in Shenzhen Growth Enterprise Market evaporated in just one day after company’s statement. Since then, the company’s stock has dropped over 10%.