Beijing Northland Biotechnology Co., Ltd. (stock abbreviation: NORTHLAND, stock code: 430047) recently released its 2020 annual report. The data show that during the reporting period, the company achieved operating revenue of 41.43286 million yuan, a year-on-year surge of 471.44%. Its subsidiary, Huonland, turned profitable during the reporting period, with annual operating revenue reaching 40.3177 million yuan and net profit reaching 9.7781 million yuan.

　　As a bio-innovative pharmaceutical company that has advanced to the Select Tier under the fourth set of criteria—“market capitalization + R&D investment”—NORTHLAND has yet to commercialize its key pipeline drugs, and its operating performance remains in the red. According to its annual report data, its net profit attributable to shareholders of the listed company in 2020 was -25.351 million yuan, with a year-on-year reduction in losses reaching 31%. As a company listed on the Select Tier of the New Third Board that has been continuously losing money, such a significant improvement in performance amid the impact of the COVID-19 pandemic in 2020 can indeed be described as "remarkable."

　　 Continuously increasing R&D investment; new drug development is progressing smoothly.

　　NORTHLAND is an innovative biopharmaceutical company specializing in the research, development, manufacturing, and sales of gene therapy drugs, recombinant protein drugs, and ophthalmic medications. The company is a representative of high-tech, innovation-driven enterprises listed on the Select Tier of the New Third Board. Currently, it is developing nine projects covering 11 indications, with three projects having entered clinical trials. The company remains in the R&D stage.

　　The annual report shows that in 2020, the company’s R&D expenditure totaled 24.1444 million yuan, accounting for 58.27% of its operating revenue. Although there was a certain degree of decline compared to the R&D investment in 2019, the company’s R&D spending remained at a high level. Particularly in 2020, amid the severe impact of the COVID-19 pandemic, the company actively implemented countermeasures and accelerated clinical trial research, achieving remarkable results in new drug development.

　　Among these, the pivotal research project NL003 has completed ethical reviews and obtained ethical approvals from a total of 17 clinical centers for its Phase III clinical trial; 16 of these centers have now been activated. The preparation of Phase III clinical trial samples has been successfully completed, and the testing of each batch of raw materials, semi-finished products, and finished products has fully met quality standards. Furthermore, the production process has been further optimized to ensure the supply of drugs for the clinical trials.

　　The NL005 project has completed the Phase I trial summary report and achieved its intended research objectives. The Phase IIa clinical study, involving five participating research centers, has fully commenced patient enrollment, with Fuwai Hospital serving as the leading coordinating center.

　　The NL002 project has completed the Phase IIIa clinical study summary report, identified the optimal dosing regimen, and is now proceeding with the design of the Phase IIIb clinical trial protocol and organizing expert reviews.

　　In addition, the company is fully leveraging the advantages of its core technology platform and its Naked Plasmid Engineering Technology Center, and in line with the development direction of a leading enterprise in genetic engineering drugs, it has initiated research on a total of five naked plasmid projects—Y001 through Y005—to further expand its portfolio of gene therapy products and broaden its pipeline for the development of novel bioengineered drugs.

　　In the field of ophthalmic generic drugs, the subsidiary Beijing Huonland Pharmaceutical Co., Ltd. has successfully passed the GMP inspection for its eye drops (single-dose 02 line) and now holds the qualification to manufacture both single-dose and multi-dose eye drops. During the reporting period, “Olopatadine Hydrochloride Eye Drops” obtained the “Drug Registration Certificate” approved and issued by the National Medical Products Administration; a registration application for the generic version of “Moxifloxacin Hydrochloride Eye Drops” was submitted and has received the Notice of Acceptance for Drug Registration. The subsidiary now has three ophthalmic products on the market, fully opening up its pharmaceutical business prospects. Through technology transfer, commercial sales, and contract manufacturing of eye drop products, the subsidiary achieved total sales revenue of 35.5481 million yuan for the year, turning a loss into a profit compared to the previous year.

　　As shown above, NORTHLAND's pharmaceutical R&D is steadily advancing, and the company's continuously expanding product pipeline will further enhance its core competitiveness and is expected to bring substantial economic benefits to the company.

　　 The bioengineering project industrial base is steadily advancing.

　　As early as 2012, NORTHLAND acquired nearly 70 mu of industrial land in the Tongzhou Economic-Technological Development Zone to establish an industrialization base and prepare for the large-scale production of its self-developed bioengineering drugs. The first-phase project—the ophthalmic drug production base—has now entered a healthy operational track, and preparatory work for the second-phase bioengineering project’s industrialization base has been fully launched.

　　During the reporting period, the design work was largely completed. The conceptual design was undertaken by Korea’s Green Cross Engineering Maintenance Corp., Ltd., while the project’s basic and detailed designs were carried out by Sinopharm Group United Engineering Co., Ltd. The joint participation of both domestic and foreign leading companies in the design process provides strong support for the company’s construction of a biopharmaceutical production base that is advanced, continuous, intelligent, and information-based on an international level.

　　According to the annual report, the bioengineering base project has completed its environmental impact assessment report and geological survey, and the administrative approval procedures required for commencement are steadily progressing. Based on previously disclosed information, the project will include a formulation workshop, a research and development center, a quality control center, an office building, and supporting facilities. The project is scheduled to break ground in 2021 and be completed in 2023. The base will primarily be used for the production of self-developed biopharmaceuticals as well as for providing CMO/CDMO services to external clients. At that time, the company will achieve fully integrated operations spanning the R&D, manufacturing, and sales of bioengineered pharmaceutical products.

　　 High scientific and technological innovation attributes; optimistic outlook for a transfer listing.

　　As an innovative biopharmaceutical company, NORTHLAND climbed two levels in the New Third Board’s tier system in 2020—first successfully advancing to the Innovation Layer on May 25, and then making another successful leap to the Select Tier on November 24. The company is one of the few enterprises that have been promoted based on the “R&D + market capitalization” criteria, which clearly demonstrates that its innovation has received high recognition from regulators. Meanwhile, judging from the results of its public offering and fundraising in the Select Tier, investors in the capital market have also shown tremendous interest in it. As the policy for transferring to the main board becomes increasingly clear, NORTHLAND’s distinctive characteristics as a high-tech, innovative enterprise are once again drawing intense attention from the capital market.

　　On March 20, 2020, the China Securities Regulatory Commission (CSRC) issued the “Guidelines for Evaluating Sci-Tech Innovation Attributes (Trial),” which proposed a specific system of evaluation indicators for sci-tech innovation attributes and clarified the standards for such attributes. At a CSRC press conference on April 16, 2021, Li Weiyou, Deputy Director of the Issuance Department of the CSRC, stated that the CSRC would revise the “Guidelines for Evaluating Sci-Tech Innovation Attributes (Trial)” to further refine the evaluation indicator system for sci-tech innovation attributes. Following this revision, the number of evaluation indicators for sci-tech innovation attributes will be expanded from the original “3+5” to “4+5,” with a new regular indicator added: the proportion of R&D personnel exceeding 10%.

　　According to information disclosed in NORTHLAND’s annual report, the company is developing nine bioengineered drugs targeting 11 indications, and three of these drugs have already entered the clinical research stage. As of now, the company holds 19 patents, including 14 domestically granted patents and 5 internationally granted patents; additionally, 9 patent applications are currently under examination. The company has successively undertaken 8 national key projects for the creation of new drugs, 1 key international science and technology innovation cooperation project between governments, as well as numerous provincial- and district-level special projects. The company’s R&D team comprises 41 members, accounting for 39.8%.

　　Whether it was the earlier “3+5” or the revised “4+5,” NORTHLAND’s three clinical-stage projects, eight major national new drug development initiatives, and a research and development workforce accounting for nearly 40% all undoubtedly meet the STAR Market’s high-tech innovation criteria and truly embody “hard tech.”

　　Looking back at its development journey, since its establishment in 2004, NORTHLAND has always taken a long-term perspective and remained committed to the research and development of new drugs, accumulating substantial technological strength and scientific research achievements. The three biotech companies—Zejing Pharmaceutical (688266), Shenzhou Cell (688520), and Junshi Biosciences (688180)—which listed on the STAR Market under the fifth set of standards for “unprofitable listings,” had market capitalizations of approximately RMB 8 billion, RMB 11 billion, and RMB 48.3 billion at the time of their IPOs, respectively. Compared with these STAR Market companies, NORTHLAND is fully comparable in terms of its R&D pipeline and clinical progress.

　　Based on the generally positive information disclosed in its 2020 annual report, we believe that as the company steadily advances its growth strategy and the macroeconomic environment improves in the post-pandemic era, its technological achievements will become even more abundant, and its financial performance will gradually materialize. Consequently, expectations for a potential transfer to a higher-tier stock exchange should gradually become clearer.

　　This article is reprinted from Wabei.com. Original link: http://www.wabei.cn/Home/News/164800