Sihuan Pharmaceutical Holdings Group Ltd. is pleased announce that "Type A Botulinum Toxin for Injection" (Letybo 100U), a product exclusively distributed by Sihuan Pharmaceutical, has officially received the marketing approval from the National Medical Products Administration of China. Letybo 100U is produced by Hugel, Inc. ("Hugel"), a biopharmaceutical company in Korea, Letybo 100U becomes the fourth type A botulinum toxin products approved for launch in the market of China and the first of its kind from Korea. It is expected that Letybo 100U will commence sales in various regions of China within this year.
The market size of botulinum toxin products in China was about US$600 million (about HK$4.66 billion) in 2019. With a penetration rate of less than 2% of the overall medical aesthetics market in China, there is still a large unmet market demand. With the continuous increase in the number of beauty-loving people in China and the continuous rise in spending power and consumption willingness of consumers, coupled by a high acceptance of foreign medical aesthetic technologies and products, especially those from Korea, there exists a huge market potential. It is expected that the sales of botulinum toxin products in China will surge in the next five years, and sales will reach US$1.8 billion (about HK$13.5 billion) in 2025. China will become one of the three largest markets of botulinum toxin products globally, along with the United States and the European Union.
Letybo 100U: a high-quality product with No.1 market share in Korea
Type A Botulinum Toxin for Injection (Letybo 100U), which has received NMPA's approval, is developed by Hugel of Korea and is the best-selling botulinum toxin product with the largest market share in Korea.
Hugel is Asia's leading manufacturer of anti-aging products. Since the launch of its botulinum toxin products in Korea in 2010, Hugel has become the fourth pharmaceutical company and the first Korean company in the Chinese market to obtain the approval for the launch of botulinum toxin product. With its patented technologies, Hugel completely extracts high-purity compound protein. It adopts stricter quality control than those required by the Ministry of Food and Drug Safety of Korea. Through stringent measures implemented in every product procedure, the whole production process is safeguarded by proprietary patents and high quality, high standards, and high efficiency are adhered to.
In terms of curative effect, Letybo 100U has the advantages of a short course of treatment and quick effect. Besides, the minimally invasive treatment only requires a short recovering period and do not affect the daily work and life of consumers. Letybo 100U has quickly received the affirmation from the medical industry and consumers. According to statistics, Letybo 100U has acquired a local market share of more than 40% in Korea, compellingly ranked first.
Beauty-lovers turning China to a massive market in medical aesthetic business
In recent years, with the rising popularity of the "appearance economy", improvement of income level, and the change of medical cosmetology concept, more and more people begin to use medical aesthetic technologies to keep them looking young and beautiful. The huge demand for medical aesthetic services is driving the rapid development of the industry.
According to public data, the CAGR of China's medical aesthetic market will exceed 25% in the next five years and is expected to reach US$45.3 billion (HK$351 billion) in 2022. According to Frost & Sullivan's data published in 2020, the number of medical treatment courses in China surpassed that in the United States, Brazil, Japan, and South Korea, ranking the first in the world.
With the continuous introduction of foreign advanced technologies and brands, medical aesthetic solutions that are simple, safe, and painless have been springing up in China. Non-surgical treatments are becoming more and more popular. Data shows that non-surgical treatments accounted for 70% of the market share in 2018. Facial injections such as hyaluronic acid and botulinum toxin have become popular treatments for micro-plastic surgery. They are a core driving force for the rapid development of the medical aesthetic industry in China.
Sihuan Pharmaceutical: Forward-looking layout of medical aesthetic arena with blockbuster toxin landing
In recent years, China has become a rising star and a major country in medical aesthetics. However, from the perspective of market layout, not too many pharmaceutical companies deployed planning in the area of medical aesthetics, and even fewer did so before China became a world's major market.
As early as 2014, Sihuan Pharmaceutical has begun to lay out in the medical aesthetic arena and has kicked off a cooperative relationship with Hugel, a top Korean medical aesthetic company.
China has strict control in botulinum toxin products, and the market entry barriers are extremely high. At present, only three products from Allergan, Lanzhou Institute of Biological Products, and Galderma, have received marketing approval.
Letybo 100U commenced the phase III clinical trial in China in 2017 and successfully obtained the marketing approval from NMPA this year. Letybo 100U is the first and only Korean botulinum toxin product approved for launch by NMPA, and is also the fourth botulinum toxin product approved for launch in China at present. The Company's goal is to shape Letybo into the No. 1 botulinum toxin brand in China and to achieve a market share of over 30% in China within three years.
Compared with other botulinum toxin products that have been launched in China, Letybo 100U is characterized by high purity, high efficacy and high quality, Letybo 100U has 99.5% of 900kDa active protein, which is much higher than the industry purity requirement (the requirement of KFDA is more than 95% of 900kDa active protein content). In terms of efficacy, Letybo 100U has the same efficacy and safety as Allergan's Botox. In terms of quality, Letybo 100U is produced under more stringent production standards and features a uniform and stable-efficacy product under stricter management standards.
In terms of the product positioning strategy of Letybo 100U, it will take into account the various target audience's needs, which includes anti-aging of young people, middle-aged and elderly people. The Company is expanding the market potential of botulinum toxin by ensuring high quality of the product with high cost performance.
In the layout of the sales of Letybo 100U, Sihuan Pharmaceutical has started preliminary work to make full preparation for the official launch of Letybo 100U within the year. Relying on the robust sales network of Sihuan Medical Aesthetic which covers more than 200 cities in China, coupled with the introduction of Hugel's fully-fledged and efficient sales methods and models, Letybo 100U 's sales performance is highly expected.
Currently, Sihuan Medical Aesthetic has strategically established a sales model in which direct sales and agent teams cooperate, and has built a strong and experienced professional and sales teams. Its business operation has covered more than 200 cities across the country with more than 800 institutional customers at the end of 2019.
Sihuan Medical Aesthetic will fully consider the different characteristics of various markets in China focusing on first-tier cities such as Beijing, Shanghai, Guangzhou, and Shenzhen which are showing common attributes of large population base, high consumption capacity, and colossal demand for medical aesthetics. Sihuan Medical Aesthetic will also consolidate academic research in association with Hugel Expert Leader's Forum (H.E.L.F), a leading symposium widely respected by the medical aesthetics industry across Korea, to reinforce the academic education and lay a solid foundation for the brand awareness of Letybo 100U.
International perspective: Building a first-class medical aesthetic platform
With an increasing penetration rate, the medical aesthetic market in China will continue to expand. A global vision and forward-looking layout will enable a company to build a first-class medical aesthetic platform with higher core competitiveness.
In recent years, Sihuan Pharmaceutical has actively promoted the planning and layout of future product pipelines and sought multi-dimensional international business cooperation. The Group meticulously founded the Sihuan Medical Aesthetic platform and introduced international innovative leading products which enjoy not only competitive advantages in the local markets but also have great potential to adapt to Chinese users.
Apart from the high-value product botulinum toxin, the core products hyaluronic acid (Sihuan acting as the sole distributor of Hugel product) and Poly-L-Lactic Acid injection (independently developed) under the Sihuan Medical Aesthetic Platform are also in the registration and clinical development stage. The introduction of Letybo 100U into the Sihuan Medical Aesthetic Platform will not only enrich and expand the product portfolio but also reflect the diversification and internationalization of the Group's strategy in product layout.
By implementing marketing projects and reasonable pricing, Sihuan Medical Aesthetic expects to expand the market recognition of its products and brands, deepen the communication with medical institutions and doctor groups to further improve service level and expand market share. It will foster the strength to compete against its peers so as to outrun its competitors and to become the leading and first-class medical aesthetic platform.
Mr. Jihoon Sohn, CEO of Hugel, Inc., said: "Sihuan Pharmaceutical Holdings Group is a leading pharmaceutical company in China and has established a solid reputation and influence in the industry, and is one of the few aesthetic enterprises with an international perspective in China. Hugel's medical beauty products are well known for their high quality and competitive price advantages, and we have made great achievements in the Korean market. Our cooperation with Sihuan Pharmaceutical reflects the strong collaboration of the international pharmaceutical industry and can maximize the synergistic advantages of each other in channels and products. The sales model of Sihuan Medical Aesthetic combining direct sales and agent teams has built an efficient platform synthesizing online and offline communication with medical institutions and physician groups, and its growing channel network will ensure the landing and laying-out of Hugel's products in the market. We are full of confidence and expectation that Letybo 100U will become the No.1 botulinum toxin product in the Chinese market, paving the way for Hugel to introduce more innovative and leading medical aesthetic products to China in the future."
Dr. Che Fengsheng, Chairman and Executive Director of Sihuan Pharmaceutical Holdings Group said: "Sihuan Pharmaceutical always adapts to market changes, timely adjusts and enriches product mix, and strives to give full play to the advantages of diversified product structure. Leveraging the brand and resource advantages of the Group established over the years, Sihuan Medical Aesthetic deeply explores hospitals and medical aesthetic institutions network and has established professional and efficient sales teams. Now with a good foundation in shape, Sihuan Medical Aesthetic will accelerate the introduction of international innovative and leading medical aesthetic products and solutions in the future. It will strive to become a sales platform with rich product lines, providing integrated and comprehensive solutions for medical aesthetic customers in serving the vast number of Chinese beauty seekers. Sihuan Medical Aesthetic aims at becoming one of the top medical aesthetic companies in China and a leader in the medical beauty market."
Dr. Che added: "Sihuan Medical Aesthetic will establish a modern R&D center, introduce high-tech talents with global vision and R&D ability of international level. It will build an internationalized R&D platform, increase investment in R&D, and accelerate the exploration of new product application transformation. With these initiatives, technical support and product reserves will be available to support the sustainable development of the platform. Sihuan Pharmaceutical will continue to center on users, analyze the market development direction with depth, grasp market trends and opportunities, and focus on new business growth points to form the most competitive, international, and professional pharmaceutical group enterprise."
About Sihuan Pharmaceutical Holdings Group Ltd.
Founded in 2001, Sihuan Pharmaceutical Holdings Group Ltd. (the "Company'' or ''Sihuan Pharmaceutical"), together with its subsidiaries (the "Group") is a pharmaceutical group with integrated research and development ("R&D"), production and marketing and sales capabilities. It is one of the largest suppliers of cardio-cerebral vascular ("CCV") prescription drugs in China. Sihuan Pharmaceutical has an excellent and professional marketing model, a nationwide distribution network, a diversified product portfolio with great market potential, as well as strong R&D capability. The Group continues to increase investment in R&D every year. Because of the continuing efforts over the past decade, Sihuan Pharmaceutical has a R&D platform with over 1,000 researchers conducting more than 110 pharmaceutical research projects. More than 300 patents on innovative drugs have been granted and over 80 of them are overseas patent. The Group's current pipeline projects cover key therapeutic areas including diabetes, oncology, anti-infectives and non-alcoholic steatohepatitis, etc.
About Hugel, Inc.
Established in Korea in 2001, Hugel is a global leader in medical aesthetics providing botulinum toxin formulation BOTULAX / LETYBO, HA filler The CHAEUM / DERMALAX, and derma cosmetic WELLAGE / PR4 brands. Dedicated to providing proven, high quality medical aesthetic solutions that satisfy both consumers' and practitioners' needs, Hugel is leading Korean market for both botulinum toxin and HA filler products and is distributing its products to over 40 countries.
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