Main points of investment:
Event: according to the company's third-quarter performance report for 2023, the company achieved operating income of 68 million in the first three quarters, an increase of 95.87% over the same period last year, and a net profit of-244 million, compared with-174 million in the same period last year. Operating income in the third quarter alone was 26 million, an increase of 80.76% over the same period last year, an increase of 5.36% over the second quarter, and a net profit of-119 million, compared with-66 million in the same period last year. Under the condition that the terminal academic promotion activities are restricted, the company's operating income still achieved positive growth in the third quarter, indicating that the main product, Contezolamide, has a certain demand at the terminal, and the profit and loss is enlarged, mainly due to the company's increased investment in research and development. overall, the company's performance is in line with expectations.
The R & D expenditure doubled in the third quarter, the sales expense rate decreased significantly compared with the previous quarter, and the management expense rate continued to improve. In the third quarter, as the company began to enroll in a number of clinical trials, the R & D expenses increased significantly, with an increase of more than 100% compared with the same period last year. The sales expense rate in the third quarter was 93.37%, a decrease of 24.78 pct compared with the second quarter, mainly due to the limitation of the terminal's academic activities. The management expense rate in the third quarter was 50.67%, a decrease of 2.03 pct from the previous quarter, indicating that the management efficiency of the company continued to improve.
The innovation pipeline is constantly advancing. The clinical progress of the core variety Contezolamide at home and abroad is steady. In China, according to the company's announcement, the single-arm phase II clinical trial of contezolamide tablets in the treatment of complex skin and soft tissue infections aged 6-17 years has been officially launched, and the Chinese phase Ⅲ clinical trial program of sequential oral contezolamide tablets for injection in the treatment of complex skin and soft tissue infections has been officially launched. In terms of internationalization, the global multicenter clinical trial of Contezolamide is progressing smoothly. According to the company's announcement, in the first half of 2023, the domestic center of the global phase Ⅲ clinical trial of sequential oral contezolamide tablets for injection in the treatment of diabetic foot infection is being enrolled, and has been approved by 5 countries overseas to conduct clinical trials in Bulgaria, Slovakia, Croatia, Poland and Brazil. Patient recruitment in the United States is ongoing at the same time. The company is also accelerating product development and MRX-5, a new antibiotic drug to treat infections caused by non-tuberculosis mycobacteria, received ethical permission from the Australian Ethics Committee for Human Research (HREC) on October 17th to conduct phase I clinical trials in humans in Australia, expected to be completed within 2024 (company announcement). Phase I clinical trials of MRX-8 (mainly for the treatment of multi-drug-resistant Gram-negative bacteria) are under way in China, and all subjects are expected to be enrolled by 2023 (company announcement).
The commercialization of Contezolamide is progressing smoothly, with continuous progress in the pipeline research and maintenance of the "buy" rating. Optimistic about the domestic volume of the core variety Contezolamide and the potential of the foreign market, we maintain our previous profit forecast and expect the net profit from 2023 to 2025 to be-360 million,-414 million and-312 million, respectively. The company ploughs the super antibiotic track, actively expands the global value, and maintains the "buy" rating.
Risk hints: the risk of R & D failure or schedule delay, the risk of product sales falling short of expectations, and the risk of continuous loss.