The loss in 2021 is in line with our expectations
The company announced its 2021 results: revenue of 30.8 million yuan; R & D expenses of 414 million yuan, an increase of 84% over the same period last year; and a net loss of 702 million yuan, in line with our expectations.
Trend of development
Relma-cel (targeted CD19 CAR-T products) has been approved to go public, and the company has entered a new stage of commercialization. In September 2021, the State Drug Administration (NMPA) approved the application of relma-cel for the marketing of new drugs for the treatment of recurrent or refractory large B-cell lymphoma (r LBCL). At present, the company has established a business team of 110 people, and its products have been included in Huimin Insurance in 16 regions. A total of 54 prescriptions for relma-cel were prescribed in 2021, and 30 patients completed reinfusion, achieving an income of 30.8 million yuan. At the same time, other indications for relma-cel are also well under way, including applications for new indications for recurrent / refractory follicular lymphomas to be accepted by NMPA in February 2022, and key clinical trials for the treatment of third-line mantle cell lymphomas and second-line LBCL are also under way.
The production process is continuously optimized to reduce the cost. According to the annual report, relma-cel 's gross profit margin in 2021 is about 29%. The company has made a five-year plan to reduce costs. In the first step, through the implementation of technologies and procedures to reduce raw material waste and waste, the company expects to achieve this goal in the second half of 2022, followed by import substitution of raw materials and optimization of production processes to further reduce costs. We believe that the company has excellent manufacturing capacity, and the reduction of production costs can improve the profitability of the company.
Appoint the chief scientific officer to strengthen early independent research and development. In January 22, the company appointed Dr. Cordoba as chief scientist to take charge of the company's early research and development. Other pipelines of the company are also progressing smoothly, JWCAR129, the CAR-T product targeting BCMA, has entered the clinic; the solid tumor TCR-T therapy JWATM204 targeting GPC3 has completed the optimization of production process, and the company plans to start clinical research in 2Q22. The company plans to continuously optimize the technology platform and expand the product pipeline.
Profit forecast and valuation
We keep our income unchanged at 229 million yuan in 2022 and introduce 467 million yuan in 2023 for the first time.
We maintain the net profit of 2022-826 million yuan, and introduce the net profit of 2023-765 million yuan for the first time.
We use the DCF valuation method to value the company, maintain the outperform industry rating and maintain the target price of HK $12.43, which is 28.4% upside from the current share price.
Risk.
The launch of new products, clinical trial data and sales are lower than expected; competition intensifies; the company's continued losses may affect product research and development and promotion.
