Hua Medicine (2552) H2 2025 earnings summary

Executive summary

• Achieved record profitability in 2025, driven by full in-house commercialization, robust dorzagliatin sales, and a one-time release of contract liability after ending the Bayer partnership.

• Revenue surged 93% year-over-year to RMB 492.9 million, with over 4 million packs sold and gross margin improving to 56.9%.

• Built a professional sales and marketing team, expanding market reach and launching an AI-driven digital platform.

• Dorzagliatin prescribed to over 500,000 patients through 3,000+ channels, with ongoing real-world evidence studies supporting efficacy and safety.

• Expanded global footprint with dorzagliatin registration and approval in Hong Kong, and ongoing efforts in Macau, Seoul, and Southeast Asia.

Financial highlights

• Revenue for 2025: RMB 492.9 million, up 93% year-over-year; sales volume up 91%.

• Gross profit margin improved by 8.2 percentage points to 56.9%, with gross profit at RMB 280.4 million.

• Selling expense ratio declined to 33.6% in 2025, down from nearly 60% in 2024.

• Achieved first full-year net profit of RMB 1.11 billion, supported by a one-time release of RMB 1.2 billion in deferred income from the Bayer agreement.

• Cash position at year-end: RMB 1.09 billion, supporting ongoing expansion and R&D.

Outlook and guidance

• Revenue targets: RMB 900 million for 2026, RMB 1.35 billion for 2027, and RMB 1.8 billion for 2028.

• Gross profit margin expected to reach 70%-75% in the next two years.

• Selling expenses projected to stabilize around 33%-35% of sales, with R&D at 30% and administration at 20%-25%.

• NDA submission for dorzagliatin-metformin FDC targeted for 2027; US Phase Ib data readout for 2nd generation GKA expected mid-2026.

• Company expects to become profitable by 2027.