Primaresearch - Aspen Pharmacare Holdings Ltd (APNHY) Aspen (APN) - Not made in China

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Primaresearch

Tumi Makoah

EUR 1700.64 For Business Accounts Only

Aspen (APN) - Not made in China

We initiate on Aspen Pharmacare Holdings (APN) and present the case that the group will continue to face increased pricing pressure both in Europe and in China.

The European thrombosis portfolio will face increased competition from the launch of biosimilars in the region, which Aspen has conceded will impact the thrombosis portfolio by EUR14 million per annum.

We are cautious of Aspen’s foray into China. The Chinese government is increasingly regulating medicine pricing through various avenues, which have caused competitors’ drug pricing to fall by as much as 67%.

We are concerned about Aspen Australia’s 1H17 nutritional sales growth decline following both the Chinese and Australian governments increased regulation on informal traders. As one of 8 Australian-based companies that have Chinese GMP accreditation to export baby formula into China, we believe Aspen should increasingly use the Chinese GMP accreditation to its benefit.

We believe an opportunity exists to further expand the nutritionals portfolio in emerging markets in our view.

16/08/2017 28 EN

Underlying

Aspen Pharmacare Holdings Ltd

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US04530Y1064 Pink OTC Markets South Africa

Provider

Primaresearch

Primaresearch is an independent, sell-side, equity research firm based in Cape Town, South Africa. We focus our research on consumer-facing companies as we have credible experience in this space. The name “primaresearch” invokes both high quality (prime) as well as “primary” research – being novel and offering value-add investment insights for our clients.

Our Vision

Our vision is to be the leading independent sell-side research firm in Africa. While we start with South Africa, we are looking into providing our clients with comprehensive, Africa-wide consumer-facing company and market research. Africa is poised to emerge as a significant consumer market, for which investors in South Africa and abroad will require thorough research and insights on. We aim to be the “go-to” research firm for these investors.

Our Culture

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Analysts

Tumi Makoah

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Aspen (APN) - Not made in China

Blue Label Telecoms (BLU) â€“ Building an ecosystem

Novus Holdings - Overvalued

Steinhoff (SNH) ; Price Discovery - How we value Steinhoff

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