Expert RA upgraded PROMOMED DM's credit rating to ruA
23.04.2025
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Industry development
23.04.2025
April 23, 2025, Moscow – PJSC PROMOMED (MOEX: PRMD) (formerly "PROMOMED", the "Company", and together with its subsidiaries, the "Group") announces the Group's IFRS financial results for the 12 months of 2024 ended December 31, 2024.
OUTSTRIPPING THE GROWTH OF KEY FINANCIAL INDICATORS
The main growth in financial indicators was achieved due to successful sales in key areas and the entry of innovative drugs into promising markets. In the fourth quarter of 2024, the company ahead of schedule introduced the innovative drug Velgia® to Russian patients, sales of which reached more than 1 billion rubles.
Velgia® has expanded the Company's endocrinological product portfolio, which includes Enligria®, Quintenta®, and the Reduxin® line. The formed portfolio covers almost all patient groups, provides a personalized approach to the treatment of diabetes and overweight, meets the most modern standards of therapy. Each of these products continues to show high double-digit growth and has the potential to expand indications in clinical use.
|
million rubles (unless otherwise specified) |
2024 |
2023 |
modified yoy |
|
Revenue |
21 449 |
15 842 |
35% |
|
EBITDA |
8 229 |
6 281 |
31% |
|
Net profit adjusted for one-time expenses[1] |
4 025 |
3 311 |
22% |
EXCEEDING THE FORECAST FIGURES ANNOUNCED DURING THE PUBLIC OFFERING AND CONFIRMING THE FORECAST FOR 2025
In 2024, the Company maintained its growth trajectory and demonstrated impressive results: a significant increase in revenue, high profitability and a reduction in debt burden. Thus, the Company fulfilled the promises made during the IPO in July 2024. The EBITDA margin exceeded the forecast and amounted to 38%. The high results achieved are predetermined by the consistent implementation of the Group's strategy, focused on developing and launching innovative products and improving the Company's operational efficiency.
|
Indicator |
Fact 2024 |
Forecast 2024 |
|
Net revenue growth, yoy |
35,4% |
>35% |
|
EBITDA margin[2], (% of net revenue) |
38% |
>35% |
|
Net profit margin adjusted for one-time expenses (% of net revenue) |
19% |
>15% |
|
Net debt / EBITDA ratio (for the last 12 months), x |
2.1x |
<2.5x |
Alexander Yefremov, CEO of PJSC PROMOMED, commented:
"The year 2024 marked a logical stage in the Company's development: we introduced a number of new-generation drugs to the market, and we were able to do this clearly and earlier than originally planned. We have significantly increased exports, as well as exceeded the financial promises we made during our IPO on the Moscow Stock Exchange.
These achievements have been made possible by our strict commitment to our strategy, which is based on the development of innovative drugs, the implementation of best practices for promotion and increased operational efficiency. Significant growth in revenue and profitability, along with a reduction in debt burden, confirm the sustainability of our business model. The success achieved allows us to confirm ambitious goals for bringing innovative drugs to the market and financial forecasts for 2025. a year."
OPERATIONAL RESULTS
|
Selected operational indicators for the reporting period |
2024 |
2023 |
|
Number of launches (launchings) of new drugs, events |
26 |
23 |
|
Number of new registration certificates, pcs. |
38 |
46 |
|
Number of new products submitted for registration, pcs. |
29 |
28 |
|
Number of medical studies conducted, pcs. |
75 |
55 |
|
Number of new patents, pcs. |
20 |
34 |
|
Selected operational indicators as of the reporting date |
31.12.24 |
31.12.23 |
|
Number of drugs in the portfolio, pcs. |
343 |
305 |
|
Number of products at the registration stage, pcs. |
32 |
41 |
|
Number of products in the process of medical research, pcs. |
75 |
45 |
|
Number of patents, pcs. |
75 |
55 |
|
Number of trademarks, pcs. |
550 |
386 |
The Company consistently implements a strategy to expand its core and key innovation portfolios, prioritizing the growth of the number of intellectual property objects. A significant increase in the number of registered drugs and patents, as well as the scaling of preclinical and clinical trials, create a stable base for continued growth and long-term strategic competitiveness of the Company.
The key drugs for treatment have entered the final stage of state registration:
- obesity;
- diabetes mellitus;
- pain syndrome;
- oncological diseases;
- HIV and viral hepatitis C.
In the reporting period, the Company fully completed research and localized the multi-stage synthesis of a number of key pharmaceutical substances at JSC Biochemik, including dolutegravir (HIV treatment), rivaroxaban (thrombosis prevention and treatment) and nilotinib (blood cancer treatment). For the first time in Russia, PROMOMED has launched a permanent synthesis of tirzepatide, an innovative active ingredient for the treatment of obesity and diabetes mellitus.
The plant of JSC Biochemik has successfully passed the inspection of Russian and foreign regulators: it has confirmed compliance with the requirements of good manufacturing practices of the EAEU, expanded the EAEU license with a permit for new types of activities (for example, work with blood products) and for the production of a number of new dosage forms (for example, suspensions for intramuscular injection with prolonged release).
As part of the implementation of the strategy to expand export potential, the plant of JSC Biochemik has successfully passed the audit of the Ministry of Health of the Republic of Iraq, confirming compliance with international requirements for the production of a range of in-demand oral and injectable dosage forms. A wide range of PROMOMED drugs is planned for registration and further circulation in Iraq and other countries of the Middle East.
The plant of JSC Biochemist has received a license and a GMP certificate of the EAEU for the production of veterinary drugs. The development and registration of a range of veterinary medicines has been completed. The sought-after drugs for the treatment of pets are planned to be launched on the market in 2025. The target market for veterinary drugs is PROMOMED pIt exceeds 11.5 billion rubles and demonstrates steady double-digit growth.
DEVELOPING A PORTFOLIO OF KEY INNOVATIVE PRODUCTS
In 2024, the Company made a qualitative leap in the implementation of a key pipeline of launches. Drugs in priority areas have been launched on the market, including the innovative drug Velgia® (semaglutide), which was put into commercial circulation ahead of schedule and became one of the largest launches of the year. In the fourth quarter of 2024, it was possible to sell more than 300 thousand packages, and revenue amounted to more than 1 billion rubles. During the reporting period, the development of a new generation drug, Tirzetta® (tirzepatide), was completed ahead of schedule, and the drug entered the market in the first quarter of 2025.
8 more innovative drugs from the key portfolio have entered the final stage of registration, including solutions for the treatment of cancer, diabetes, pain syndrome, viral and orphan diseases. Progress at all stages of development — from preclinical studies to registration — confirms the consistent implementation of the strategy for the creation of new generation drugs. The focus on therapeutic areas with a high need for breakthrough solutions provides a solid foundation for meaningful financial performance growth in the coming years.
Kira Zaslavskaya, Director of New Products, commented:
"For PROMOMED, research is a strategic driver of the entire business model. It is through R&D that we not only scale growth, but also build a foundation for the years ahead.
We continue to systematically invest in the creation of the latest drugs and technologies. It's about integrating medical science, artificial intelligence, and high-tech manufacturing into a single managed ecosystem. This approach allows us to shape trends and create products that can change treatment standards in Russia and beyond."
Information about relevant markets
|
Therapeutic areas |
2024, the size of the relevant market is billion rubles. [3] |
2023, the size of the relevant market is billion rubles. [4] |
2024, The Company's Product Evolution Index[5] |
|
Endocrinology |
22,7 |
12,8 |
142 |
|
Oncology |
27,1 |
24,8 |
149 |
|
Other drugs in the Basic Portfolio |
210,1 |
183,0 |
129 |
PROMOMED focuses on strategically important and fastest-growing segments of the pharmaceutical market, where there is a particularly high unmet need for innovative and technological solutions. In key areas of the therapeutic portfolio, the growth rate of the Company's products is systematically outpacing the dynamics of relevant markets, which is reflected in the value of the Evolution Index, which significantly exceeds the level of 100.
Information about the sales structure
|
2024 |
2023 |
|
|
Share of Endocrinology and Oncology drugs in revenue, % |
63% |
52% |
|
The share of drugs sold through commercial and budget sales channels, % |
53%/47% |
47%/53% |
|
The share of VED[6] products in revenue, % |
62% |
61% |
|
Share of prescription drugs in revenue, % |
94% |
96% |
|
The share of innovative products in revenue, % |
59% |
48% |
|
Share of biotech products in revenue, % |
43% |
31% |
The share of innovative drugs in the Company's revenue increased to 59% in 2024. Biotechnological drugs accounted for 43% of the products sold. This reflects the right strategic focus on bringing high-tech drugs to the market, and confirms the steady demand for their unique therapeutic properties from doctors and patients.
The Company's export sales increased by 56% compared to 2023, reflecting the increasing interest in PROMOMED's innovative products in foreign markets.
Ilya Bardin-Denisov, CEO of PROMOMED DM LLC, commented: "We are steadily strengthening and increasing our positions in key therapeutic segments through the launch of high-tech products and the active development of additional commercial channels, including a variety of online promotions. Over the past year, PROMOMED has significantly expanded its international presence. Export sales increased by 56%, reflecting the growing interest in our products. In 2025, we will continue to expand our export geography, focusing on markets with a high demand for high-quality innovative solutions from reliable suppliers." FINANCIAL RESULTS [7]
|
million rubles (unless otherwise specified) |
2024 |
2023 |
modified yoy |
|
Revenue |
21 449 |
15 842 |
35% |
|
Gross profit |
14 202 |
10 034 |
42% |
|
Gross profit margin |
66% |
63% |
+3 pp. |
|
EBITDA |
8 229 |
6 281 |
31% |
|
EBITDA margin |
38% |
40% |
-2 pp. |
|
Net profit |
2 876 |
2 969 |
-3% |
|
Net income adjusted for one-time expenses |
4 025 |
3 311 |
22% |
RevenueIn 2024, the company grew by 35% to 21.4 billion rubles. compared to 15.8 billion rubles in 2023. The growth rate of revenue significantly outpaced the growth rate of the pharmaceutical market, which amounted to about 18%[8]. This became possible due to the expansion of the product portfolio, as well as the active growth of sales in strategic therapeutic areas — Endocrinology and Oncology.
- In Endocrinology, revenue growth in 2024 was +87% YoY. The indicator was a clear result of the large-scale sale of the Company's endocrinological product line, which includes the drugs Enligria®, Quintenta®, Reduxin® and Reduxin® Forte. The acceleration of growth dynamics was supported by the launch of the innovative drug Velgia® on the market — the volume of drug sales in the 4th quarter exceeded 1 billion rubles.
- In Oncology, revenue growth in 2024 was 41% YoY, due to targeted promotion and implementation in oncourology and oncohematology, as well as increased supply volumes under federal and regional programs.
- In the segment of other drugs in the Core Portfolio, excluding drugs for the treatment of COVID-19, revenue growth in 2024 was 31% compared to 2023, reflecting a steady increase in demand for these drugs and the expansion of the geography of commercial sales. A significant contribution was made by sales of Rivaroxaban®, a vital anticoagulant developed and fully localized as part of import substitution. The company is operationalThe company responded to the urgent needs of the Rivaroxaban healthcare system by establishing supplies to the budget segment: in 2024, about 320 thousand packages were sold, and revenue exceeded 1 billion rubles, which confirms the demand for high-quality locally produced solutions.
Gross profit in 2024 increased by 42% to 14.2 billion rubles. compared to 10.0 billion rubles in 2023. The positive dynamics is due to an increase in the share of high-margin innovative products and optimization of production costs.
- Gross profit margin increased to 66% in 2024 from 63% in 2023.
EBITDA in 2024 increased by 31% to 8.2 billion rubles. compared to 6.3 billion rubles a year earlier.
- The EBITDA margin in 2024 was 38% and exceeded the forecast provided as part of the IPO in July 2024.
Financial expenses in 2024 increased to 2.5 billion rubles. compared to 1.2 billion rubles in 2023. The increase in expenses is due to an increase in interest rates and an increase in the volume of financing raised to support the expansion of production capacity and product line.
Net profit, adjusted for one-time expenses, for the reporting period amounted to 4,025 million rubles, which is 22% higher than the result in 2023.
Key liquidity indicators
|
million rubles (unless otherwise specified) |
31.12.2024 |
31.12.2023 |
|
Debt on loans and borrowings |
20 987 |
16 656 |
|
Cash and cash equivalents |
(4 082) |
(622) |
|
Net debt |
16 905 |
16 033 |
|
Net debt/LTM EBITDA, x |
2.1x |
2,6x |
Key cash flow indicators
|
million rubles (unless otherwise specified) |
2024 |
2023 |
|
Net cash flow from operating activities |
93 |
(1 191) |
|
Change in the number of working capital and |
18 211 |
12 183 |
|
Change in trade accounts receivable |
(7 951) |
(7 127) |
|
Cash flow from investing activities, including: |
6 020 |
4 770 |
|
Capital expenditures[9] |
2 650 |
2 897 |
|
Research & Development (R&D)[10] |
1 413 |
1 525 |
|
Free cash flow |
(3 970) |
(5 613) |
At the same time, the indicator remained under pressure from a number of factors, including an increase in interest payments against the background of an increase in the key rate of the Bank of Russia.
Net working capital in 2024 amounted to 18.2 billion rubles, an increase of 44% compared to 12.2 billion rubles a year earlier. The growth is due to the scaling of commercial activities, the expansion of stocks for the withdrawal of new drugs, as well as an increase in accounts receivable. An increase in accounts receivable in the reporting period by 45% to RUB 16.1 billion. compared to 11.2 billion rubles at the end of 2023., caused by an increase in shipments of drugs to the budgetdue to the seasonal nature of purchases, as well as the launch of new drugs in Endocrinology.
The Company expects optimization of net working capital and accounts receivable in subsequent periods, including through the current Sales&Operations Planning (SnOP) process and expansion of the pool of local suppliers.
As of the date of publication of the financial statements, there are no overdue accounts receivable.
Cash flow from investing activities in 2024 increased to 6.0 billion rubles against 4.8 billion rubles in 2023. The growth is related to investments in research and development of new products and the implementation of previously launched technical re-equipment programs.
Capital expenditures in 2024 decreased by 9% to 2.7 billion rubles. compared to 2.9 billion rubles in 2023. The decrease is due to the completion of a number of major projects to expand the production base, including at the site of JSC Biochemik.
Capitalized R&D expenses In 2024, clinical research expenses increased by 12% and accounted for 69% of total R&D expenses during the period, which confirms the Company's commitment to developing innovative products.
FORECAST FOR 2025
Based on the results for 2024, the Company confirms the previously published forecast for 2025, presented below.:
|
Indicator |
2025 forecast |
|
Net revenue growth, yoy |
75% |
|
EBITDA margin level[11] (% of net revenue) |
>40% |
|
Net profit margin (% of net revenue) |
>20% |
|
Net debt / EBITDA ratio (for the last 12 months), x |
<2,5x |
PJSC PROMOMED is a leading innovative biopharmaceutical company with the potential for significant growth in promising segments of the pharmaceutical market.
The Company's structure includes its own unique world-class R&D center and a high-tech enterprise, the Biochemist plant. Thanks to this, PROMOMED implements the concept of a full production cycle "from Idea to Molecule, from Molecule to Patient", promptly responds to the current needs of the industry, and also implements the latest technologies to create innovative medicines. The company develops a diversified portfolio of more than 350 medicines in the TOP 10 segments of the pharmaceutical market. The Company's portfolio includes "blockbuster" drugs and innovative biotechnological drugs that have no analogues on the Russian market. Based on its own developments, the Company produces drugs for the treatment of socially significant diseases: oncology, diabetes, obesity, neurology, infectious diseases, rheumatology, etc. Thanks to its own innovative chemical technologies and biotechnologies, as well as modern production facilities, the Company is an active participant in the system of ensuring national drug safety and import independence of the country.
Investor Day, dedicated to the strategy, operational and financial results of PJSC PROMOMED for 2024, will begin at 16:00 on April 23, 2025.
To participate in the online broadcast, you must register using the link: registration
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This message and the information contained therein are not:
- an offer to purchase any securities,
- an invitation to make offers for the purchase of any securities,
- as part of such offers or invitations,
- securities advertising in the Russian Federation or other jurisdictions,
- by encouraging or recommending transactions,
- it is also not subject to interpretation as such.
Neither this communication, nor any part of it, is the basis for concluding any transaction or incurring any obligation., They cannot be used in connection with any transactions or obligations or serve as an incentive to conclude any transactions or make any commitments.
Neither this announcement nor any part of it should serve as a basis for making any investment decisions.
The publication of this communication does not imply investment consulting (in the meaning defined in the legislation of the Russian Federation (including Federal Law No. 39-FZ of April 22, 1996 "On the Securities Market"). The information provided in this message is not an individual investment recommendation, and the financial instruments or transactions mentioned in it may not meet your investment profile and investment goals (expectations). It is your task to determine whether a financial instrument or operation matches your interests, investment goals, investment horizon, and acceptable risk level. PJSC PROMOMED (hereinafter referred to as the Company) is not responsible for possible losses in the event of transactions or investments in financial instruments mentioned in this information, and does not recommend using this information as the sole source of information when making an investment decision.
Before making an investment decision on making or not making transactions with the Company's shares, it is necessary, among other things, to familiarize yourself with the information disclosed on the Company's web page.https://e-disclosure.ru/portal/company.aspx?id=38533.
The information contained in this announcement may include estimates and other forward-looking statements regarding the intentions, plans, future events, financial, operational or other activities of the Group. Actual events, calculations and results of their activities may differ materially from those contained or anticipated in the forward-looking statements, words and expressions contained in this communication or related materials due to the influence of various external and internal factors (general economic conditions; risks associated with the specifics of the Company's activities, including those that cannot be controlled by the Company; changes in market conditions in the industry in which the Company and the Group operate; geopolitical and other factors and risks). The indication of goals, potential, growth opportunities or other indicators is not a guarantee of the realization of these goals, potential, opportunities.
The methodology for determining and calculating the operational and financial indicators of a Company may differ from the methodology used by other individuals, companies or organizations.
The Company or persons belonging to the Group, their directors, participants (shareholders), employees, representatives do not provide any guarantees or assurances confirming the accuracy, completeness or unambiguous nature of the information and information contained in this communication or related materials, and do not assume any obligations or obligations to updating them.
[1] For the calculation, the net profit indicator was used, adjusted for one-time expenses related to the IPO, as well as for the created income tax reserve.
[2] Hereinafter, adjusted EBITDA is understood as net profit for the period adjusted for the amount of income tax expenses, finance costs, finance income, depreciation of intangible assets and depreciation of fixed assets and assets in the form of right of use.
[3] Source: IQVIA, secondary sales data in producer prices.
[4] Source: IQVIA, secondary sales data in producer prices.
[5] Evolution Index (EI) is an evolution index calculated to assess the progress of a product and/or a company's product portfolio in the market, reflecting the growth rate of a product compared to the growth of its relevant market. Values above 100 indicate by how many percentage points the product or portfolio is growing faster than the market.
[6] Vital and essential medicines
[7] IFRS data, management reporting
[8] Source IQVIA database
[9] Corresponds to the line "Payments in connection with the acquisition, creation, modernization, reconstruction and preparation for the use of the OS" Cash Flow statement of IFRS reporting, CapEx
[10] Corresponds to the line "Payments in connection with the acquisition and creation of intangible assets" Cash Flow statement IFRS reportinnovation, R&D
[11] Hereinafter, adjusted EBITDA is understood as net profit for the period adjusted for the amount of income tax expenses, finance costs, finance income, depreciation of intangible assets and depreciation of fixed assets and assets in the form of right of use.
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