This report is read as follows:
The R & D progress is relatively smooth, the commercialization of listed varieties is strong, and the company is gradually iterated into a global biotechnology company in China, which is expected to exceed market expectations and maintain its overweight rating.
Summary:
Maintain the "overweight" rating. The company announced that 22H1 revenue was 2.2 billion yuan, of which product revenue was 2.041 billion yuan, an increase of 10.0% over the same period last year; adjusted net loss was 1.085 billion yuan, an increase of 408 million yuan over the same period in 21 years; it was in line with expectations. The income forecast for 22-24 is 56.0,78.0 and 9.81 billion yuan. Use the DCF absolute valuation method to maintain the target price of HK $52.70 and maintain the overweight rating.
PD-1 and bioanalogues drive sales volume. Income in the first half of 22 was affected by repeated epidemics and PD-1 price reduction. The gross profit margin was 78.6%, down 11.2% from the same period last year, mainly due to the decline in the price of PD-1, the lower gross profit margin of cooperative products and biosimilar. The sales expense rate is 66.7% of the product revenue, an increase of 10% over the same period last year, mainly due to the commercialization of new products and the strategic expansion of the sales team. It is expected that the sales expense rate will decline in the future.
The first echelon of PD-1 adaptation Department in China, three first-line indications of large tumors: non-squamous non-small cell lung cancer, squamous non-small cell lung cancer and liver cancer have been included in medical insurance; first-line esophageal squamous cell carcinoma and first-line gastric cancer were approved in June; EGFR+ non-squamous non-small cell lung cancer has been submitted to NDA. It is expected that the sales of similar biological drugs will grow rapidly, especially the continuous release of Dayutong, which accounts for a relatively high proportion.
Research and development is progressing smoothly. 22H1 invested 1.078 billion yuan in R & D, an increase of 22.5% over the same period last year. RET is expected to be approved for listing in 22 years; IBI-326 (BCMA CAR-T) and IBI-306 (PCSK9) are in the NDA stage; 22-year IBI-376 (PI3K δ) and IBI-310 (CTLA-4) are expected to be submitted to NDA; in the non-tumor field. IBI-362 (GLP-1/GCGR) and IBI-112 (IL-23p19) are about to enter the registered clinic. Coupled with Sanofi share subscription, so far about $1.5 billion in cash on hand, ample capital reserves. The early pipeline now has a deep layout of PD-1, CD47, LAG3, TIGIT and other IO target families, as well as hypolipidemic, weight loss / diabetes, ophthalmology and other fields. The National Qing Yuan has more than 300 researchers, and it is expected to deliver 6-10 molecules a year in the future, bringing about a breakthrough in first-in-class new drug molecules. Overseas clinical development teams have been initially established and have the ability to promote global research.
Catalyst: the release of products exceeded expectations; the clinical data in the research and innovation of new drugs exceeded expectations.
Risk tips: product research and development is not as expected, industry policy fluctuations, financing is not as expected, sales are not as expected.