Core views:

Over $8 billion joined hands with BMS to achieve overseas licensing for B01D1. According to the company's announcement on December 12, subsidiary SysTimmune and BMS have reached a global strategic cooperation agreement.

SysTimmune will be exclusively responsible for the development, commercialization and production of BL-B01D1 in mainland China, and for the production of some pharmaceuticals for use outside of mainland China.

BMS will be solely responsible for the development and commercialization of BL-B01D1 in other regions of the world. BMS will make an initial payment of $800 million to SysTimmune, and up to $500 million in recent contingent payments; after reaching development, registration, and sales milestones, SysTimmune will receive up to $7.1 billion in additional payments; and a potential total transaction volume of up to $8.4 billion.

B01D1 registration phase III progressed smoothly, and early data was presented at many international academic conferences. B01D1 is the world's first EGFR/HER3 ADC. Domestic clinical trials have entered phase III and are intended to be used to treat nasopharyngeal cancer. At the same time, applications for phase III or critical registration phase II clinical studies have been completed. In terms of overseas clinical development, a global multi-center phase I clinical study (BL-B01D1-LUNG101) has been carried out to treat NSCLC. Early clinical research data on B01D1 have been published at ASCO, ESMO, and SABCS conferences in 2023. The data showed that BLB01D1 showed promising anti-tumor activity in various solid tumors such as non-small cell lung cancer, nasopharyngeal cancer, and breast cancer that progressed after standard treatment.

The value of the platform has been highlighted, and innovative achievements have continued to be implemented. The company has established an integrated ADC platform, and a total of 4 ADCs have entered phase I/II. Various drugs incubated by the dual/multiple antibody platform are leading the world in progress:

SI-B001 (EGFRXHER3) treats NSCLC in phase III, and clinical trials with docetaxel have also been approved by the FDA; the combined clinical trial of SI-B003 (PD-1XCTLA-4), SI-001, and chemotherapy is in phase II; and GNC-038,, and are all in phase I. GNC-035 GNC-039

Profit forecasts and investment advice. The company's revenue for 2023-2025 is estimated to be 5.31, 73.56, and 950 million yuan respectively, mainly from stock business sales and confirmation of initial payments and milestone payments related to BD. The early data of B01D1 is impressive, and cooperation with BMS will accelerate its globalization process. Using the DCF valuation method, the company obtained a reasonable value of 167.13 yuan/share, maintaining a “buy” rating.

Risk warning. Risk of R&D failure, product sales falling short of expectations, market competition exceeding expectations, etc.