Drug deuterium generation and PROTAC platform-based technology to support continuous R&D output
The company's deuterium-generation drug research and development platform has full-chain capabilities in all development links. The R&D team has rich experience and international competitive advantages in deuterium-generation drug project formulation, screening and clinical pathway development. The company already has many major innovative drugs such as HC-1119 and HP530S based on the deuterium generation technology platform. Among them, HC-1119 has advanced to the marketing application stage, and the platform is definitive. The company's PROTAC protein-degrading drug research and development platform has many independent patents and is already under investigation through multiple pipelines. Preclinical data such as HP518, HP568, HC-X029, and HC-X035 are in the first tier of PROTAC drug research and development at home and abroad.
The first product, deuterium enzaluride, was declared for sale, and the second-generation AR inhibitor pattern is good
Deuterium enzalutamide is a new second-generation AR inhibitor class 1 drug produced domestically. The innovative drugs currently on sale are Pfizer/Astellas's enzalutamine and Hengrui Pharmaceutical's reverulamine, which have a good competitive pattern. HC-1119 is a deuterium-generation product of enzalutamide. Lower doses have higher efficacy, better safety, and better patient compliance. The compound patent is valid until 2032, and there is no short-term competitive risk of generic drug marketing. Since then, two registered phase III clinical trial studies for first-line treatment (global multi-center) and terminal treatment of metastatic castration-resistant prostate cancer have been carried out simultaneously.
Health insurance payment and collection policies are transparent and refined, and the environment for research and development of innovative drugs is improved to support innovation
As national health insurance negotiations have gradually matured in recent years, the trend of compulsory fee control has gradually slowed down. Judging from the 2022 National Health Insurance Talks and the 2023 Pharmaceutical Device Collection Policy, drug payers with clear clinical benefits have gradually relaxed, encouraging domestic innovative drug research and development. The company's independent patents are enriched, and the technology platform and differentiated target layout form an advantage.
Investment advice
We are optimistic about the company's deuterium generation technology and PROTAC new drug research and development platform. Platform-based technology will establish continuous research and development for innovative pharmaceutical companies; we are optimistic about the company's sales volume after the launch of deuterium enzalutamide; the company's in-depth layout in the field of castrated metastatic prostate cancer and AR antagonists, and the pipeline is progressing steadily.
We expect revenue from 2023 to 2025 to be RMB 0.02 million, RMB 154 million, and RMB 391 million, up 29.9%, 7060.8%, and 154.4% year on year. The company is still investing in R&D and is nearing commercialization. It is expected to maintain losses in the next few years. Net profit from 2023 to 2025 will be -248 million yuan, -117 million yuan, and -0.33 million yuan, and will continue to narrow. Covered for the first time, giving it a “buy” rating.
Risk warning
Risk of failure to meet expectations, risk of industry policy risk, risk of sales fluctuation, risk of rising costs.