Recommended logic: 1) antibiotic resistance is becoming more and more serious, and the value of super antibiotics is prominent. The World Health Organization (WHO) predicts that if no action is taken, antimicrobial resistance will kill 10 million people in 2050. Mengke Pharmaceutical Co., Ltd. focuses on the field of multi-drug-resistant bacteria antibiotics, and its core products have global value. 2) Contezolamide was approved to be listed in 2021 and negotiated through health insurance, and its safety is better than that of linezolid. The company launched a global multicenter trial of MRX-4 sequential contezolamide tablets in March 2022 and is expected to be completed in 2026. It is estimated that the domestic peak sales (contezolamide and MRX-4) are expected to exceed 2 billion yuan. 3) the total treatment days of multi-drug-resistant Gram-negative bacteria in China in 2020 was 4690 million days. MRX-8 is the next generation of polymyxin drugs developed by the company, which is currently in the stage of Ⅰ clinical research. Preclinical data show that it can significantly reduce nephrotoxicity and neurotoxicity.
Mengke Pharmaceutical Co., Ltd. focuses on the field of multi-drug-resistant bacteria antibiotics, and its core products have global value. The World Health Organization (WHO) predicts that if no action is taken, antimicrobial resistance will kill 10 million people in 2050, more than cancer. Mengke Pharmaceutical focuses on the field of anti-multi-drug-resistant bacteria, and its core product, MRX-I, was approved for market in China in June 2021; MRX-4 has launched a sequential global multicenter Ⅲ clinical trial of Contezolamide; MRX-8 is currently in phase Ⅰ clinical trials in the United States.
Contezolamide and MRX-4: the clinical value is clear and the market space is broad. Contizolide is a new generation of oxazolidinone antimicrobials, which was put on the market and included in health insurance in 2021. MRX-4 is a water-soluble prodrug based on contezolamide, which has been developed for injection and oral administration. The safety of contezolid is better than that of linezolid. We expect that it has a broad market space in hematology, ICU, respiratory and other departments and related indications, and the domestic peak sales (contezolid and MRX-4) are expected to exceed 2 billion yuan. The company launched a global multicenter trial of MRX-4 sequential contezolamide tablets in March 2022. The study plans to include approximately 700 subjects in approximately 50 centers in China, the United States and Europe, and is expected to be completed in 2026. We expect the overseas peak sales of the above products to exceed 3 billion RMB.
MRX-8 has a differentiated design and is expected to improve the risk of nephrotoxicity of polymyxin. The clinical detection of gram-negative bacteria accounted for 2% of all bacteria, and there was a wide space for the use of related antibiotics. In 2020, the total treatment days of multidrug-resistant Gram-negative bacteria in China was 4690 million days. MRX-8 is the next generation of polymyxin drugs developed by the company, which is currently in the stage of Ⅰ clinical research. Preclinical data show that it can significantly reduce nephrotoxicity and neurotoxicity, and is expected to improve the safety of existing polymyxin antibiotics. The company's follow-up pipelines include borane antibiotics MRX-5, truncated Pleurotin MRX-7 and so on, which are currently in the stage of preclinical research.
Profit forecast and investment suggestion: the net profit of the company from 2022 to 2024 is expected to be-160 million yuan,-450 million yuan and-280 million yuan respectively. We select Baili Tianheng, Yifang Biology and Dizhe Pharmaceuticals, which are the closest to the company's business in the industry. the average PS of the above companies in 2023 is 85 times. Mengke Pharmaceutical products have clear clinical value, high expectation of going to sea and strong certainty of growth. The absolute valuation of the company is estimated by FCFF valuation method, and the intrinsic value per share is about 14.13 yuan. According to the PS valuation method, the company will be given 85 times PS in 2023, corresponding to the target price of 12.94 yuan, covered for the first time and given a "buy" rating.
Risk hints: product clinical research and development progress is not as expected risk, product commercial sales income is not as expected risk, industry competition pattern deterioration risk, policy risk.