Has the era of "vaccine porters" come to an end?

Author | Sun Mengyuan Yu Xing

Editor | Yu Xing

Source | Yema Finance

"Chairman, in recent years, investors who have invested in your company have lost over 95%, with 1 million reduced to just a few tens of thousands. Such severe losses cannot be compensated by a few words and apologies. Please provide a detailed response on what aspects the company will invest in, such as mergers and acquisitions, buybacks, restructuring, etc. We want to hear the truth because we have listened to empty words for 6 years, and there is nothing left." On May 8, at the performance briefing of ZHIFEI-BIOL (300122.SZ), an investor asked this question to the chairman of ZHIFEI-BIOL, Jiang Rensheng.

In response, Jiang Rensheng stated: Understanding shareholders' feelings, the stock price is under pressure due to the deep adjustment in the industry; the company is resolving risks and promoting stable and positive operations through measures such as adjusting the debt structure, promoting innovation transformation, and reconstructing the business model.

However, one fact is that this once "white horse stock" of vaccines is facing its first annual loss since its listing. It is worth noting that in 2021, ZHIFEI-BIOL held the rights to two major products, the COVID-19 vaccine and Merck's HPV9 vaccine, with net profits exceeding 10 billion, reaching a peak of 10.209 billion yuan.

Data shows that ZHIFEI-BIOL's total revenue for the year 2025 is 8.958 billion yuan, a year-on-year decrease of 65.61%; the net loss attributable to shareholders is 14.723 billion yuan, and the net loss excluding non-recurring items is 14.744 billion yuan. At the beginning of the company's annual report, it is prominently written: "We sincerely apologize to all investors who have trusted, supported, and placed high hopes on the company for a long time."

Senior corporate management expert and senior consultant Dong Peng stated that the core of trust is win-win rather than empty words. In the face of deeply trapped investors, market value management must implement three pragmatic measures: in the short term, "high dividend payout or major shareholder's unrestricted increase in holdings" clearly shows sincerity; in the medium term, "full disclosure of key processes" eliminates information asymmetry; in the long term, incorporating "automatic buybacks when below net asset value" into the articles of association, upgrading market value maintenance to a governance hard constraint to resist cyclical fluctuations.

As of January 13, ZHIFEI-BIOL closed at 15.8 yuan/share, with a total market value of 37.822 billion yuan.

Image source: Canned Image Library

01

The "King of Vaccines" Performance Collapse

In the medical industry, ZHIFEI-BIOL was once known as the "King of Vaccines," but it is no longer the same. This loss-making annual report is not surprising, as ZHIFEI-BIOL had already announced this in a notice in January. It is worth noting that the net loss attributable to shareholders in the performance forecast reached a maximum of 13.726 billion yuan, with a difference of about 1 billion yuan from the actual net loss in the annual report. **

The Q1 2026 report shows that ZHIFEI-BIOL's quarterly loss expanded to 388 million yuan year-on-year. The company explained that factors such as market demand contraction and a decline in public vaccination willingness affected the sales of its main products, compounded by credit impairment losses, leading to the loss in Q1 2026.

During the performance briefing, an investor asked the company when it would achieve a quarterly profit. ZHIFEI-BIOL stated that as of the end of Q1 this year, the net cash flow from operating activities had been positive for five consecutive quarters, and the debt structure had significantly improved. The cooperation model with Merck had also been adjusted. Meanwhile, the company is actively promoting the research and development of its own products, and if self-developed products such as the 15-valent pneumonia combined vaccine and the quadrivalent meningococcal combined vaccine are approved, they will have a positive impact on the company's performance.

As of Q1 2026, the company had liabilities of 13.38 billion yuan, with non-current liabilities due within one year amounting to 2.878 billion yuan, a significant increase of 271.42% compared to the beginning of the period, mainly due to an increase in long-term loans due within one year. The ending cash and cash equivalents amounted to 1.709 billion yuan, while the balance of cash and cash equivalents was only 1.63 billion yuan.

Source: Canned Image Library

In response to the funding gap, ZHIFEI-BIOL proposed to issue corporate bonds not exceeding 6 billion yuan in July 2025. This is the company's first large-scale debt financing since its listing 15 years ago, aimed at addressing increasingly severe operational challenges.

To replace existing financing and supplement daily operating funds, on January 5, 2026, ZHIFEI-BIOL applied to a banking consortium for medium to long-term loans, with an application amount not exceeding 10.2 billion yuan and a term not exceeding 3 years. It is noteworthy that in this financing arrangement, the company's actual controller Jiang Rensheng and his spouse, as well as their son Jiang Lingfeng and his spouse, will provide free guarantees for the company, constituting a related party transaction.

ZHIFEI-BIOL emphasized that this financing is beneficial for optimizing the debt structure, supplementing working capital, accelerating the progress of R&D projects, and promoting the company's stable operations, and that the guarantees provided by related parties are of a gratuitous nature, with no harm to the interests of the company and minority shareholders.

From the perspective of the debt structure, the company's debt situation has indeed improved. In Q1 2026, ZHIFEI-BIOL's accounts receivable amounted to 10.925 billion yuan, a significant decrease from 16.302 billion yuan at the beginning of 2025. During the same period, ZHIFEI-BIOL's short-term loans were 560 million yuan, and long-term loans were 7.359 billion yuan, totaling 7.919 billion yuan, a significant decrease from 11 billion yuan at the end of 2025. At the same time, the proportion of short-term loans to total short-term and long-term loans decreased from 78% to around 7%.

In response to the first hundred billion-level loss since its listing, ZHIFEI-BIOL's executive team chose to voluntarily reduce their salaries. Among them, ZHIFEI-BIOL's chairman Jiang Rensheng and vice chairman and president Jiang Lingfeng voluntarily waived all performance bonuses for 2025, and other non-independent directors and senior management also voluntarily waived part of their annual salaries After excluding statistical caliber factors, the average salary of the company's directors and senior management in 2025 decreased by 3.78 million yuan compared to the same period last year, with an average decline of 20.8%.

Specifically, there are a total of 21 directors and senior management in the company, with an actual payment of 19.857 million yuan in 2025. Among them, director Yang Shilong ranks first with 1.28 million yuan, while chairman Jiang Rensheng received 756,000 yuan, becoming the lowest-paid among non-independent directors.

Source: Canned Image Library

It is worth mentioning that on May 8, ZHIFEI-BIOL received a regulatory letter due to inaccuracies in multiple financial report data.

Previously, on April 28, ZHIFEI-BIOL made retrospective adjustments to its financial data from 2020 to the third quarter of 2025 due to accounting errors such as improper recognition of service fee income, failure to consider post-period returns, and errors in cash flow statement items. The Shenzhen Stock Exchange believes that chairman Jiang Rensheng, president Jiang Lingfeng, and financial director Li Zhenjing violated regulations, and urged the company and relevant parties to learn from the lessons, rectify in a timely manner, and prevent the recurrence of the aforementioned issues.

Dong Peng believes that the deviation in service fee recognition and insufficient return estimates are essentially a concentrated outbreak of the "pressure goods and rush volume" model problems in the pharmaceutical distribution industry. Although it has switched to "demand-driven dynamic procurement" to resolve inventory risks from the source, the key to fundamentally addressing the inflated figures lies not in contract terms, but in two major implementations: first, real-time linkage of terminal flow data to prevent artificial manipulation, and second, strict enforcement of actual sales and settlements with sufficient impairment to ensure profits reflect real vaccination data.

02

Agency business has become difficult

The rise of ZHIFEI-BIOL is closely linked to Merck's nine-valent HPV vaccine. After becoming Merck's exclusive agent in China in 2017, the company's revenue skyrocketed from 446 million yuan in 2016 to 52.918 billion yuan in 2023.

This cooperation created a commercial legend. In 2018, ZHIFEI-BIOL adjusted its procurement amount for Merck's HPV vaccine to 18 billion yuan, nearly quadrupling compared to 2017. In 2023, Merck's HPV vaccine sales in the international market reached 6.8 billion USD, with most of the growth contributed by the Chinese market.

However, this successful model also buried hidden dangers. In 2023, revenue from agency products accounted for 98.05% of total revenue. By the first half of 2025, the proportion of agency product revenue remained as high as 89%.

At the beginning of 2023, ZHIFEI-BIOL also renewed its agreement with Merck, agreeing to complete HPV vaccine purchases totaling over 98 billion yuan by the end of 2026, with over 32.6 billion yuan to be paid in 2024 alone. However, in June 2025, Wantai Biological Pharmacy (603392.SH) received approval for its Xinkening, the first domestically produced nine-valent HPV vaccine in China and the second nine-valent HPV vaccine globally, breaking Merck's market monopoly that lasted for over a decade In 2025, ZHIFEI-BIOL accrued a total asset impairment loss of approximately 14.128 billion yuan, including an inventory write-down of about 13.618 billion yuan, with a specific provision for the core agency's HPV vaccine amounting to approximately 12.766 billion yuan.

The company stated that in response to industry changes brought about by fluctuations in market demand, in 2025, the company gradually participated in government subsidized vaccination programs, actively fulfilling its social responsibility while responding to market changes. The company plans to further expand the scope of its participation in subsidized programs and, in accordance with the requirements of enterprise accounting standards, will make provisions for inventory write-downs on products sold below cost in these programs. For inventory that does not meet production and operational needs, or is nearing expiration, full provisions for inventory write-downs will be made.

Under the pressure of inventory, Merck gave ZHIFEI-BIOL a break. In April 2026, the company and Merck amicably negotiated to suspend the procurement of HPV vaccines for 2025, and signed an agency agreement, where both parties will dynamically assess and adjust the procurement and supply volume of the agreed products based on market demand.

Yuan Shuai, co-founder of the New Smart Manufacturing Productivity Salon, pointed out that from a financial structure perspective, this "high leverage + low liquidity" combination is particularly dangerous in the biopharmaceutical industry. This industry is characterized by long R&D cycles, high capital requirements, and strict policy regulation, and companies typically need to maintain a high cash reserve to cope with risks such as clinical failures and approval delays. ZHIFEI-BIOL's current financial strategy clearly contradicts industry norms; the high proportion of short-term loans not only increases financial costs but also squeezes the space for R&D investment, creating a negative cycle of "declining performance - financing constraints - lagging R&D - decreasing competitiveness." If the company cannot quickly improve its capital structure through asset disposals, equity financing, or debt restructuring, it may face extreme risks of bankruptcy liquidation initiated by creditors.

Source: Canned Image Library

03

"Chongqing's Richest" Holds Two Listed Companies

Second-generation successors face dual challenges

In April 2021, ZHIFEI-BIOL had a market value of nearly 370 billion yuan, and founder Jiang Rensheng had a net worth of 140 billion yuan that year, ranking 21st in the country, thus earning him the title of "Chongqing's Richest."

By 2025, Jiang Rensheng still held the position of "Chongqing's Richest," but his net worth had significantly shrunk. The Hurun Rich List shows that the Jiang Rensheng family had a wealth of 42 billion yuan in 2025, ranking 420th nationwide.

Jiang Rensheng was born in 1953 in Xiushui Village, Guanyang County, Guangxi Province. At the age of 17, he became a private teacher and later worked in the Guangxi epidemic prevention system for nearly 20 years. He served as the deputy director of the Guanyang County Health and Epidemic Prevention Station, and as deputy director and director of the Immunization Planning and Biological Products Departments of the Guangxi Health and Epidemic Prevention Station. At the age of 46, Jiang Rensheng gave up his "iron rice bowl" and became a vaccine salesman. During this period of his career, he recognized the development prospects of domestic vaccines In 2002, Jiang Rensheng acquired a vaccine company called Chongqing Jinxin Biological Products, which was later renamed Chongqing ZHIFEI-BIOL Technology Co., Ltd.

In 2005, a C group meningitis epidemic broke out in China, and at that time, only Lanzhou Biological Products Research Institute had the vaccine, which was exclusively represented by Jiang Rensheng.

That year, Jiang Rensheng's son Jiang Lingfeng, who was working in legal affairs, resigned to follow his father in entrepreneurship. Currently, Jiang Rensheng holds 48.44% of the shares, and Jiang Lingfeng holds 5.41%, making them the top two shareholders of ZHIFEI-BIOL.

Jiang Lingfeng was born in 1980 and graduated from Guangxi University with a degree in law in 2003. He then pursued a master's degree in business administration at Guangxi University and obtained an Executive MBA from Peking University's Guanghua School of Management. In recent years, he has worked at ZHIFEI Longke Ma and ZHIFEI Lvzhu, and he is currently the vice chairman and president of ZHIFEI-BIOL.

In 2008, Jiang Rensheng restructured three companies with R&D capabilities: Lvzhu Pharmaceutical, Chongqing Zhiren, and Anhui Longke Ma, and began selling self-developed products thereafter.

After completing four restructurings, ZHIFEI-BIOL was listed on the Shenzhen Stock Exchange in 2010.

In addition to ZHIFEI-BIOL, Jiang Rensheng is also laying out his pharmaceutical landscape. In June 2023, Jiang Rensheng's controlled ZhiXiang JinTai (688443.SH) was listed on the Sci-Tech Innovation Board. ZhiXiang JinTai mainly develops innovative antibody drugs in the field of autoimmune diseases, and its legal representative and chairman, Shan Jikuan, is one of the founding shareholders of Junshi Biosciences, holding 5.29% of the shares. In addition, several senior executives from ZHIFEI-BIOL are also part of ZhiXiang JinTai's management team.

However, the research and commercialization of innovative drugs is a challenge. Since its listing, in 2023, 2024, and 2025, ZhiXiang JinTai's net profit attributable to the parent company was -800 million yuan, -797 million yuan, and -536 million yuan, respectively, with total losses exceeding 2 billion yuan over three years.

As of January 13, ZhiXiang JinTai closed at 31.20 yuan per share, with a total market value of 11.44 billion yuan.

Source: Canned Image Library

Now, ZHIFEI-BIOL is undergoing a power transition. In September 2024, the company held its first meeting of the sixth board of directors and appointed Jiang Lingfeng as the company's president.

Regarding his son's performance, Jiang Rensheng used terms like "steady and assured." Jiang Lingfeng's own response was, "There is a long way to go," and "I will work tirelessly to meet expectations."

Under the governance of the father and son, ZHIFEI-BIOL is seeking transformation. In March 2025, the company announced a cash increase of 593 million yuan to Chongqing Chen'an Biological Pharmaceutical Co., Ltd. to acquire 51% of the latter's equity. Through this transaction, ZHIFEI-BIOL will extend its business from vaccines to the field of metabolic diseases, obtaining several products nearing commercialization, such as Semaglutide injection (for blood sugar control and weight loss) This is the first time ZHIFEI-BIOL has achieved control over other companies through capital operations since its listing.

In recent years, the revenue share of ZHIFEI-BIOL's self-developed products has been continuously increasing. Financial reports show that the revenue from its self-developed products rose significantly from 4.50% of total revenue in 2024 to 13.25% in 2025.

In 2026, with the launch of the already listed quadrivalent influenza virus split vaccine, influenza virus split vaccine, and the under-review 15-valent pneumococcal conjugate vaccine and ACYW135 group meningococcal polysaccharide vaccine, as well as metabolic products like liraglutide and degludec insulin, self-developed products will account for a larger proportion of ZHIFEI's revenue. As of the end of 2025, ZHIFEI-BIOL has a total of 35 preventive self-developed projects under research, of which 26 projects are in the stages of application, clinical trials, and registration.

From "flipping bricks for profit" to "research and development for internal strength," the agency dividend has run out, and self-developed tickets are hard to obtain. Do you think ZHIFEI can be reborn after this "self-mutilation for survival"? Regarding the cyclical impact on the vaccine industry, feel free to share your thoughts in the comments.