THIS MATERIAL IS A MARKETING COMMUNICATION.
Chinese Vaccine Industry Research Series I
Vaccines: Past, Present, and Future
The Oldest Biotech Drug in the World
Vaccines are probably the oldest biological drug in the world. In 1796 a British physician used matter from cowpox pustules to inoculate patients successfully against smallpox (caused by a related virus). By 1900, there were two human virus vaccines developed against smallpox and rabies and three bacterial vaccines against plague, typhoid, and cholera.
Immunization (or vaccination) is perhaps the most cost-effective public health intervention and is said to prevent 2-3 million deaths per year.
The vaccine market size is about US$35bn in 2020 (vs. around US$5bn in 2000) and has been growing at around 9% CAGR. The main growth driver has been the launch of key vaccines in the past two decades, including pentavalent DTP-HepB-Hib (2004), meningococcal ACYW (2005), pediatric pneumococcal (2000), HPV (2006), and rotavirus (2006) as well as increasing penetration.
Oligopolistic Market
While the market for vaccines is attractive, new entrants in the global vaccine market have been limited. In our view, this is due to:
- Long lead times for development.
- Complex manufacturing. There are typically 20 to 25 site inspections per year for vaccine facilities from the Food and Drug Administration (FDA), the European Medicines Agency (EMA), the WHO, national regulatory authorities, and internal audits by quality assurance teams.
- Complex and different (vs. regular drugs) distribution channels
- Complex regulations. As an example, in the US, the FDA requires new vaccine plants to operate for at least two years prior to releasing products to the market to demonstrate sterility, absence of foreign particulate matter, and proper reconstitution and consistency following freeze-drying.
In terms of value, the top four companies contribute over 80% of the global vaccine market. And the top four diseases account for 60% of the revenues. While in terms of volume, MNCs account for ~30% of the volume because the leading companies focus more on selling newer, innovative drugs, while smaller domestic players focus older, less innovative vaccines as well as focus only on the local market.
A Promising Future for mRNA Technology
mRNA is a single-stranded molecule that carries genetic code from DNA in a cell’s nucleus to ribosomes, the cell’s protein-making machinery. mRNA medicines are simply sets of instructions that can be given to cells in the body to stimulate the production of a specific protein that can help prevent or fight disease. Various companies have developed or are trying to develop technologies and methods to create mRNA sequences that cells recognize as if they were produced in the body.
Several MNCs have already signed partnerships with companies developing mRNA technologies in vaccines. Pfizer, as an example, has partnered with BioNTech for its influenza candidate, Merck with Moderna on RSV, and Sanofi with Translate Bio. CureVac, partnering with Boehringer Ingelheim and Lilly, develops oncology products and Genmab for antibodies.
Disclaimer
This document is intended for Hong Kong investors only. This material is neither an offer to sell nor solicitation to buy a security to any person in any jurisdiction where such solicitation, offer, purchase or sale would be unlawful under the laws of that jurisdiction. Investment involves risk.
The information in this material is based on sources we believe to be reliable but we do not guarantee the accuracy of completeness of the information provided. This material has not been reviewed by SFC and shall only be circulated in countries where it is permitted.
This material is intended solely for your private use and shall not be reproduced or recirculated either in whole or in part, without the written permission of Mirae Asset Global Investments. This document has been prepared for presentation, illustration and discussion purposes only and is not legally binding. Whilst compiled from sources Mirae Asset Global Investments believes to be accurate, no representation, warranty, assurance or implication to the accuracy, completeness or adequacy from defect of any kind is made. The division, group, subsidiary or affiliate of Mirae Asset Global Investments which produced this document shall not be liable to the recipient or controlling shareholders of the recipient resulting from its use. The views and information discussed or referred in this report are as of the date of publication, are subject to change and may not reflect the current views of the writer(s). The views expressed represent an assessment of market conditions at a specific point in time, are to be treated as opinions only and should not be relied upon as investment advice regarding a particular investment or markets in general. In addition, the opinions expressed are those of the writer(s) and may differ from those of other Mirae Asset Global Investments’ investment professionals.
The provision of this document shall not be deemed as constituting any offer, acceptance, or promise of any further contract or amendment to any contract which may exist between the parties. The issuer of this article is Mirae Asset Global Investments (HK) Limited (“we”) which we may or our managed funds may hold the mentioned securities. It should not be distributed to any other party except with the written consent of Mirae Asset Global Investments. Nothing herein contained shall be construed as granting the recipient whether directly or indirectly or by implication, any license or right, under any copy right or intellectual property rights to use the information herein. This document may include reference data from third-party sources and Mirae Asset Global Investments has not conducted any audit, validation, or verification of such data. Mirae Asset Global Investments accepts no liability for any loss or damage of any kind resulting out of the unauthorized use of this document. Investment involves risk. Past performance figures are not indicative of future performance. Forward-looking statements are not guarantees of performance. The information presented is not intended to provide specific investment advice. Please carefully read through the offering documents and seek independent professional advice before you make any investment decision. Products, services, and information may not be available in your jurisdiction and may be offered by affiliates, subsidiaries, and/or distributors of Mirae Asset Global Investments as stipulated by local laws and regulations. Please consult with your professional adviser for further information on the availability of products and services within your jurisdiction.
Hong Kong: This material is prepared by Mirae Asset Global Investments (HK) Limited (Mirae HK). Mirae HK is regulated by the SFC (CE reference: ALK083).
Australia: The information contained on this document is provided by Mirae Asset Global Investments (HK) Limited (“MAGIHK”), which is exempt from the requirement to hold an Australian financial services license under the Corporations Act 2001 (Cth) (Corporations Act) pursuant to ASIC Class Order 03/1103 (Class Order) in respect of the financial services it provides to wholesale clients (as defined in the Corporations Act) in Australia. MAGIHK is regulated by the Securities and Futures Commission of Hong Kong under Hong Kong laws, which differ from Australian laws. Pursuant to the Class Order, this document and any information regarding MAGIHK and its products is strictly provided to and intended for Australian wholesale clients only. By accessing this document and any information or content contained in it, you represent that you are a ‘wholesale client’ under the Corporations Act. This document is strictly for information purposes only and does not constitute a representation that any investment strategy is suitable or appropriate for an investor’s individual circumstances. Further, this document should not be regarded by investors as a substitute for independent professional advice or the exercise of their own judgement. The contents of this document is prepared and maintained by Mirae Asset Global Investments (HK) Limited and has not been reviewed by the Australian Investments & Securities Commission. No part of this publication may be reproduced in any form, or referred to in any other publication, without express written permission of MAGI HK. Copyright 2020. All rights reserved.
Chinese Vaccine Industry Research Series I
Vaccines: Past, Present, and Future
The Oldest Biotech Drug in the World
Vaccines are probably the oldest biological drug in the world. In 1796 a British physician used matter from cowpox pustules to inoculate patients successfully against smallpox (caused by a related virus). By 1900, there were two human virus vaccines developed against smallpox and rabies and three bacterial vaccines against plague, typhoid, and cholera.
Immunization (or vaccination) is perhaps the most cost-effective public health intervention and is said to prevent 2-3 million deaths per year.
The vaccine market size is about US$35bn in 2020 (vs. around US$5bn in 2000) and has been growing at around 9% CAGR. The main growth driver has been the launch of key vaccines in the past two decades, including pentavalent DTP-HepB-Hib (2004), meningococcal ACYW (2005), pediatric pneumococcal (2000), HPV (2006), and rotavirus (2006) as well as increasing penetration.
Oligopolistic Market
While the market for vaccines is attractive, new entrants in the global vaccine market have been limited. In our view, this is due to:
- Long lead times for development.
- Complex manufacturing. There are typically 20 to 25 site inspections per year for vaccine facilities from the Food and Drug Administration (FDA), the European Medicines Agency (EMA), the WHO, national regulatory authorities, and internal audits by quality assurance teams.
- Complex and different (vs. regular drugs) distribution channels
- Complex regulations. As an example, in the US, the FDA requires new vaccine plants to operate for at least two years prior to releasing products to the market to demonstrate sterility, absence of foreign particulate matter, and proper reconstitution and consistency following freeze-drying.
In terms of value, the top four companies contribute over 80% of the global vaccine market. And the top four diseases account for 60% of the revenues. While in terms of volume, MNCs account for ~30% of the volume because the leading companies focus more on selling newer, innovative drugs, while smaller domestic players focus older, less innovative vaccines as well as focus only on the local market.
A Promising Future for mRNA Technology
mRNA is a single-stranded molecule that carries genetic code from DNA in a cell’s nucleus to ribosomes, the cell’s protein-making machinery. mRNA medicines are simply sets of instructions that can be given to cells in the body to stimulate the production of a specific protein that can help prevent or fight disease. Various companies have developed or are trying to develop technologies and methods to create mRNA sequences that cells recognize as if they were produced in the body.
Several MNCs have already signed partnerships with companies developing mRNA technologies in vaccines. Pfizer, as an example, has partnered with BioNTech for its influenza candidate, Merck with Moderna on RSV, and Sanofi with Translate Bio. CureVac, partnering with Boehringer Ingelheim and Lilly, develops oncology products and Genmab for antibodies.
Disclaimer
This document is intended for Hong Kong investors only. This material is neither an offer to sell nor solicitation to buy a security to any person in any jurisdiction where such solicitation, offer, purchase or sale would be unlawful under the laws of that jurisdiction. Investment involves risk.
The information in this material is based on sources we believe to be reliable but we do not guarantee the accuracy of completeness of the information provided. This material has not been reviewed by SFC and shall only be circulated in countries where it is permitted.
This material is intended solely for your private use and shall not be reproduced or recirculated either in whole or in part, without the written permission of Mirae Asset Global Investments. This document has been prepared for presentation, illustration and discussion purposes only and is not legally binding. Whilst compiled from sources Mirae Asset Global Investments believes to be accurate, no representation, warranty, assurance or implication to the accuracy, completeness or adequacy from defect of any kind is made. The division, group, subsidiary or affiliate of Mirae Asset Global Investments which produced this document shall not be liable to the recipient or controlling shareholders of the recipient resulting from its use. The views and information discussed or referred in this report are as of the date of publication, are subject to change and may not reflect the current views of the writer(s). The views expressed represent an assessment of market conditions at a specific point in time, are to be treated as opinions only and should not be relied upon as investment advice regarding a particular investment or markets in general. In addition, the opinions expressed are those of the writer(s) and may differ from those of other Mirae Asset Global Investments’ investment professionals.
The provision of this document shall not be deemed as constituting any offer, acceptance, or promise of any further contract or amendment to any contract which may exist between the parties. The issuer of this article is Mirae Asset Global Investments (HK) Limited (“we”) which we may or our managed funds may hold the mentioned securities. It should not be distributed to any other party except with the written consent of Mirae Asset Global Investments. Nothing herein contained shall be construed as granting the recipient whether directly or indirectly or by implication, any license or right, under any copy right or intellectual property rights to use the information herein. This document may include reference data from third-party sources and Mirae Asset Global Investments has not conducted any audit, validation, or verification of such data. Mirae Asset Global Investments accepts no liability for any loss or damage of any kind resulting out of the unauthorized use of this document. Investment involves risk. Past performance figures are not indicative of future performance. Forward-looking statements are not guarantees of performance. The information presented is not intended to provide specific investment advice. Please carefully read through the offering documents and seek independent professional advice before you make any investment decision. Products, services, and information may not be available in your jurisdiction and may be offered by affiliates, subsidiaries, and/or distributors of Mirae Asset Global Investments as stipulated by local laws and regulations. Please consult with your professional adviser for further information on the availability of products and services within your jurisdiction.
Hong Kong: This material is prepared by Mirae Asset Global Investments (HK) Limited (Mirae HK). Mirae HK is regulated by the SFC (CE reference: ALK083).
Australia: The information contained on this document is provided by Mirae Asset Global Investments (HK) Limited (“MAGIHK”), which is exempt from the requirement to hold an Australian financial services license under the Corporations Act 2001 (Cth) (Corporations Act) pursuant to ASIC Class Order 03/1103 (Class Order) in respect of the financial services it provides to wholesale clients (as defined in the Corporations Act) in Australia. MAGIHK is regulated by the Securities and Futures Commission of Hong Kong under Hong Kong laws, which differ from Australian laws. Pursuant to the Class Order, this document and any information regarding MAGIHK and its products is strictly provided to and intended for Australian wholesale clients only. By accessing this document and any information or content contained in it, you represent that you are a ‘wholesale client’ under the Corporations Act. This document is strictly for information purposes only and does not constitute a representation that any investment strategy is suitable or appropriate for an investor’s individual circumstances. Further, this document should not be regarded by investors as a substitute for independent professional advice or the exercise of their own judgement. The contents of this document is prepared and maintained by Mirae Asset Global Investments (HK) Limited and has not been reviewed by the Australian Investments & Securities Commission. No part of this publication may be reproduced in any form, or referred to in any other publication, without express written permission of MAGI HK. Copyright 2020. All rights reserved.
Disclaimer & Information for Investors
No distribution, solicitation or advice: This document is provided for information and illustrative purposes and is intended for your use only. It is not a solicitation, offer or recommendation to buy or sell any security or other financial instrument. The information contained in this document has been provided as a general market commentary only and does not constitute any form of regulated financial advice, legal, tax or other regulated service.
The views and information discussed or referred in this document are as of the date of publication. Certain of the statements contained in this document are statements of future expectations and other forward-looking statements. Views, opinions and estimates may change without notice and are based on a number of assumptions which may or may not eventuate or prove to be accurate. Actual results, performance or events may differ materially from those in such statements. In addition, the opinions expressed may differ from those of other Mirae Asset Global Investments’ investment professionals.
Investment involves risk: Past performance is not indicative of future performance. It cannot be guaranteed that the performance of the Fund will generate a return and there may be circumstances where no return is generated or the amount invested is lost. It may not be suitable for persons unfamiliar with the underlying securities or who are unwilling or unable to bear the risk of loss and ownership of such investment. Before making any investment decision, investors should read the Prospectus for details and the risk factors. Investors should ensure they fully understand the risks associated with the Fund and should also consider their own investment objective and risk tolerance level. Investors are advised to seek independent professional advice before making any investment.
Sources: Information and opinions presented in this document have been obtained or derived from sources which in the opinion of Mirae Asset Global Investments (“MAGI”) are reliable, but we make no representation as to their accuracy or completeness. We accept no liability for a loss arising from the use of this document.
Products, services and information may not be available in your jurisdiction and may be offered by affiliates, subsidiaries and/or distributors of MAGI as stipulated by local laws and regulations. Please consult with your professional adviser for further information on the availability of products and services within your jurisdiction. This document is issued by Mirae Asset Global Investments (HK) Limited and has not been reviewed by the Securities and Futures Commission.
Information for EU investors pursuant to Regulation (EU) 2019/1156: This document is a marketing communication and is intended for Professional Investors only. A Prospectus is available for the Mirae Asset Global Discovery Fund (the “Company”) a société d'investissement à capital variable (SICAV) domiciled in Luxembourg structured as an umbrella with a number of sub-funds. Key Investor Information Documents (“KIIDs”) are available for each share class of each of the sub-funds of the Company.
The Company’s Prospectus and the KIIDs can be obtained from www.am.miraeasset.eu/fund-literature . The Prospectus is available in English, French, German, and Danish, while the KIIDs are available in one of the official languages of each of the EU Member States into which each sub-fund has been notified for marketing under the Directive 2009/65/EC (the “UCITS Directive”). Please refer to the Prospectus and the KIID before making any final investment decisions.
A summary of investor rights is available in English from www.am.miraeasset.eu/investor-rights-summary.
The sub-funds of the Company are currently notified for marketing into a number of EU Member States under the UCITS Directive. FundRock Management Company can terminate such notifications for any share class and/or sub-fund of the Company at any time using the process contained in Article 93a of the UCITS Directive.
Australia: The information contained in this document is provided by Mirae Asset Global Investments (HK) Limited (“MAGIHK”), which is exempted from the requirement to hold an Australian financial services license under the Corporations Act 2001 (Cth) (Corporations Act) pursuant to ASIC Class Order 03/1103 (Class Order) in respect of the financial services it provides to wholesale clients (as defined in the Corporations Act) in Australia. MAGIHK is regulated by the Securities and Futures Commission of Hong Kong under Hong Kong laws, which differ from Australian laws. Pursuant to the Class Order, this document and any information regarding MAGIHK and its products is strictly provided to and intended for Australian wholesale clients only. The contents of this document is prepared by Mirae Asset Global Investments (HK) Limited and has not been reviewed by the Australian Investments & Securities Commission.
Copyright 2021. All rights reserved. No part of this document may be reproduced in any form, or referred to in any other publication, without express written permission of Mirae Asset Global Investments (Hong Kong) Limited.