Novartis joined and helped Ociperlimab to open up the international market. Recently, the company announced that the wholly-owned subsidiary Baiji Switzerland Novartis AG signed a "cooperation agreement", in which the company granted Novartis AG an exclusive, time-based option, so that Novartis AG can exercise this option to obtain an exclusive license for the development, production and commercialization of the company's TIGIT inhibitor Ociperlimab in regions such as the United States. Novartis AG will pay a down payment of US $300 million to the company; if Novartis AG exercises the option within a limited period of time, the company will be eligible to receive an additional payment of US $600 million or US $700 million in accordance with the terms of the Cooperation Agreement, and shall be eligible for a payment of up to US $745 million after achieving the regulatory approval milestone; after achieving the sales milestone, the company will be eligible for a payment of up to US $1.15 billion And the company is also eligible for graded license fees. This agreement is another major product cooperation agreement between the company and Novartis following the signing of the cooperation agreement on PD-1 McAb inhibitor tirelizumab.
Anti-Tigit monoclonal antibody Ociperlimab is expected to add icing on the cake to PD-1, and Baiji leads the world in progress.
Ociperlimab is a TIGIT inhibitor in the later stage of research and development. At present, two III lung cancer trials (AdvanTIG-302 and AdvanTIG-301) are being carried out, which are aimed at the first-line treatment of advanced NSCLC with high expression of PD-L1 and simultaneous immunochemotherapy of NSCLC in phase III. At present, it is leading in the progress of similar varieties in the world, and a number of II / I studies in the field of solid tumors are also under way. After signing the agreement with Novartis, it is expected to speed up the global development and marketing of Ociperlimab by virtue of Novartis's R & D and commercialization capabilities in the global oncology field.
Profit forecast and investment advice. It is estimated that the net loss of 21-23 years is RMB 117,78 and 3 billion yuan; using risk-adjusted DCF valuation method, the reasonable value is 311.64 US dollars / ADS, corresponding to H shares 186.55 Hong Kong dollars per share and A shares 152.84 yuan per share. Maintain the "buy" rating of US and Hong Kong stocks and give A shares a "buy" rating.
Risk tips. Ociperlimab research and development is not as advanced as expected, and commercialization is not as expected.