On January 11, Yao Ming Biotech attended the 42nd J.P. Morgan Healthcare Conference and updated on recent developments.
The number of new projects added in 2023 exceeded expectations, and the number of new non-COVID-19 projects reached a record high: due to the slowdown in biotechnology financing, 2023Q1's new project signing was blocked for a short period of time. From Q2 to a strong recovery in the second half of the year, the number of new projects added reached 132 throughout the year, including 91 new projects added in January-November and 41 new projects in a single month in December. By region, 55% of the new projects are from North America, 25% from China, and 14% from Europe. Furthermore, the company raised the target number of new projects in 2024 from 80 to 110, demonstrating the company's confidence in business development in 2024.
The number of commercialized projects in 2023 exceeded expectations and continued to take advantage of the “winning molecule” advantage: by the end of 2023, the number of the company's clinical phase III projects reached 51, an increase of 14 compared with the same period last year; the number of commercialization projects reached 24, exceeding the previous forecast of 21-23.
Among them, 9 of the company's new “winning molecules” strategy projects in 2023 are in clinical phase III (7) or commercialization (2), which also reached record highs, greatly exceeding the 5 previously anticipated. The number of clinical phase III clinical and commercial projects continues to increase, which is expected to drive rapid growth in the company's performance in the future.
Ireland's production capacity climbed beyond expectations, showing leading management integration capabilities: the Irish factory (MFG6/7) was released in 2022/Q4, and construction speed set a record. Currently, MGF6 has completed the first batch of PPQ production.
Starting in 2024, the Irish site is expected to have a large commercial production demand and is expected to achieve break-even (1 year earlier than the original plan). MFG6/7 production capacity is expected to be close to full production by 2025.
Maintain a “Highly Recommended” investment rating. The company continues to use the advantages of the CRDMO business model, “win molecules” and “follow molecules” strategies to introduce more high-quality projects to the company, and the leading technology platform enhances global competitiveness. We believe that global biotechnology investment and financing has shown signs of recovery. In the future, as the company's clinical phase III clinical and commercialization projects continue to advance, the company's performance is expected to resume relatively rapid growth, and the market share is expected to continue to increase. It is estimated that in 2023-2025, the company's total revenue will rise 169/194/25.2 billion yuan, and net profit to mother will be 33/38/50 billion yuan respectively, corresponding PE will be 39/34/26 times, respectively, maintaining a “highly recommended” investment rating.
Risk warning: risks such as exchange rate fluctuations, investment and financing environment, geopolitics, etc.