Event: the company released the 2023 semi-annual report, the company marketing team started to build, the progress of R & D projects continued to advance, there is no product sales revenue, the company has not yet made a profit. The net profit of return to home was-165 million yuan, and the net profit of deducting non-return was-182 million yuan, an increase of 18.2404 million yuan over the same period last year, an increase of 11.12%.
HC-1119 (deuterated Enzalutamide) is actively preparing for listing: the application for listing of HC-1119 was accepted by NMPA in March 2023, the review is currently in progress, and the verification work of the Food and Drug Inspection Center (CFDI) of the State Drug Administration is under way. Phase III clinical trials of HC-1119 for the first-line treatment of castration-resistant prostate cancer are under way in multiple centers around the world. The company is actively carrying out commercial team building. At present, the heads of various departments of the marketing core team have been gradually in place, and the company is actively participating in the academic exchange meeting of experts.
The progress of PROTAC HP518 is expected: HP518 can degrade both wild-type AR and point mutant AR. The current research data show that it has the following advantages: good stability of ①; good oral bioavailability of ②; high AR degradation activity of ③; high exposure of ④ tumor tissue and strong drug resistance; it has the potential to solve the drug resistance caused by AR mutation in patients with advanced prostate cancer. At the same time, because the drug mechanism of PROTAC is to completely eliminate the function of AR through AR degradation, it has a stronger inhibitory effect on AR, so it has the potential to be used in the treatment of early stage prostate cancer. HP518 achieved its first patient enrollment in Australia at the beginning of 2022. At present, multiple dose groups of climbing Ia clinical studies have been completed and are progressing smoothly as planned. HP518's application for a dose-extended Ib study submitted in the United States was approved in January 2023 and preparations for clinical trials are under way. HP518 China clinical trial application was accepted by NMPA in August 2023. HP518 is the first oral AR PROTAC drug under development in China to enter the clinical trial stage.
Investment suggestion: Haichuang Pharmaceutical Co., Ltd. is an innovation-driven international innovative pharmaceutical enterprise. Based on platforms such as PROTAC targeted protein degradation and deuteration technology, the company focuses on innovative drug research and development in treatment areas with significant market potential, such as cancer and metabolic diseases. We expect the company to achieve an operating income of 160 million yuan and a net profit of 3.53 million yuan from 2023 to 2025. Maintain the "overweight" rating.
Risk hints: the risk of new drug research and development falling short of expectations, the risk of product sales falling short of expectations, the risks brought by pharmaceutical macro policies, etc.