Core views
Conoah-B released its 2023 results report. During the reporting period, the company achieved revenue of 354 million yuan, an increase of 253.87% over the previous year, and invested about 600 million yuan in R&D. Two core pipelines, CM901 and CM310, have been recognized as breakthrough therapeutics, of which the first indication for CM310 has been submitted for NDA. In 2024, CM310's chronic sinusitis with nasal polyps is expected to be NDA Q3, and the AD indication is expected to be approved in Q4. CM313 and CM336 expect potential data readouts in 2024H2. The company continues to expand its innovative drug product layout and is about to enter a new stage of commercialization.
occurrences
On March 26, 2023, Conoa-B released its 2023 performance report. In 2023, the company achieved revenue of 354 million yuan, an increase of 253.87% over the previous year, and a significant increase in revenue.
Brief review
1. The performance is in line with expectations, and there is sufficient cash on hand
On March 26, 2023, Conoa-B released its 2023 performance report. In 2023, the company achieved revenue of 354 million yuan, an increase of 253.87% over the previous year, mainly from foreign cooperation revenue of 350 million yuan, and R&D investment of about 600 million yuan, an increase of 18% over the previous year. Cash on hand is RMB 2.7 billion.
2. Sproximab CM310 (IL-4R?) : The first IL-4R developed in China? Is the antibody, the potential BIC molecule CM310, the first IL-4R developed in China? The antibody is also the only IL-4R that has 5 indications to enter registered clinical trials? molecules. CM310 has submitted an NDA and is included in priority review and approval, and will soon enter a new phase of commercialization. CM310 can be widely used to treat moderate to severe atopic dermatitis, chronic sinusitis with nasal polyps, seasonal allergic rhinitis, and asthma.
The main efficacy endpoints of CM310 were achieved in the treatment of severe atopic dermatitis (AD) in adults, and the data were released in 2023EADV: 66.9% of subjects who achieved EASI-75 at 16 weeks of treatment, 44.2% of subjects who reached IGA 0/1 and decreased by at least 2 points from the baseline, and the EASI-75 compliance rate and IGA 0/1 compliance rate at 16 weeks of treatment were significantly superior to the placebo group. Patients experienced improvements in pruritus control and quality of life. The application for the new drug was accepted by the CDE in December 2023; the phase III clinical study to treat severe atopic dermatitis (AD) in adolescents began in 2024Q1, and patients are currently being enrolled.
The phase III clinical study of CM310 for chronic sinusitis with nasal polyps (crSWnP) reached the two main endpoints of changes in the 24-week nasal polyposis score (NPS) and nasal congestion score (NCS) compared to baseline, and was safe. An NDA is expected to be filed in 2024.
In addition, a phase III clinical study evaluating CM310 for treating patients with seasonal allergic rhinitis under background treatment and a multicenter, single-arm phase II clinical study evaluating the safety of CM310 in patients with seasonal allergic rhinitis are being carried out and advanced; it is planned to submit an NDA application for CM310 in the treatment of asthma and COPD in 2026 and beyond.
Connoah plans to set up a commercialization team of 200-300 people for CM310, covering core departments such as marketing, medicine, admission, sales, and operational excellence to maximize the clinical value of CM310.
3. CMG901/AZD0901: Recognized as a breakthrough therapeutic drug, and another self-developed CMG901 independently developed by Connoah is the world's first clinically approved Claudin 18.2 ADC drug. It has obtained FDA orphan drug qualification and fast track certification and CDE breakthrough therapeutic certification. It has signed an exclusive global licensing agreement with AstraZeneca AB, and has received a down payment of 63 million US dollars and more than 1.1 billion US dollars in milestone payments.
Clinically, CMG901 has carried out a number of global multi-center clinical trials. The indications include gastric cancer and pancreatic cancer. AstraZeneca has conducted several II/III clinical studies on CMG901 in the treatment of advanced solid tumors. Phase I clinical study data for the treatment of advanced gastric cancer/gastroesophageal adenocarcinoma were published in ASCO. ORR was 33%, DCR was 70%, MPFs reached 4.76 months, and MOs were not yet achieved. The data showed that CMG901 showed excellent efficacy, safety and good tolerability in the treatment of advanced Claudin18.2 positive gastric cancer/gastroesophageal junction adenocarcinoma patients.
AstraZeneca AB has also initiated a global multi-center clinical phase III trial for CMG901 second-line and third-line 18.2 positive gastric cancer patients.
4. CM313 and CM338: Highly effective humanized antibodies. The clinical prospects are promising. CM313 has great clinical potential and excellent pre-clinical data performance. The latest phase I clinical study data for recurrent or refractory myeloma (RRMM) was released in the EHA. The ORR was 34.5%, the median follow-up time was 6 months, the median progression-free survival time was 132 days, and the tolerability was good. IIT clinical study data for treating primary immune thrombocytopenia (ITP) in adults was released in 2023 ASH, achieving a 100% objective remission rate. Phase IB/IIa trials for systemic lupus erythematosus are being actively promoted and are currently in the dose escalation phase of phase I clinical studies.
CM338 is 50 times more effective in inhibiting lectin pathway activation than Narsoplimab analogs, and inhibits lectin pathway activation more effectively; patients are being enrolled in phase II clinical studies to promote the treatment of immunoglobulin A nephropathy (IgAN).
5. CM326 (TSLP): CM326, a leading domestically produced TSLP antibody candidate, is a potential drug developed to treat moderate to severe asthma and other potential allergic diseases, and can treat both eosinophil-dependent and non-dependent inflammatory diseases. CM326 has completed the enrollment of patients in phase II clinical trials with AD indications and completed the enrollment of patients in phase IB/IIIa clinical trials with CRSwnP. It has cooperated with Shiyao Group to launch a phase II trial for the treatment of moderate to severe asthma in March 2023.
CM326 has shown higher efficacy in clinical research. CM326 is 5 times more bioactive than Tezepelumab analogs in inhibiting TSLP-induced cell proliferation and activation. At the same time, good safety data were obtained in a single dose trial in phase I healthy people: the total incidence of TEAE was similar in the CM326 injection group and the placebo group; no grade 3 TEAE was reported, no SAE, SUSAR, or deaths were reported, and no subjects withdrew from the study due to drug-related TEAE.
Overall, CM326 has good safety and a broad therapeutic range, and may have a synergistic effect with CM310, and has great potential for clinical value.
6. Multi-pipeline layout in the field of oncology, promotion of high-efficiency R&D
As of March 26, 2023, Konoah has developed more than 30 products, 10 of which are in the IND/clinical stage. The company continues to develop innovative antibody therapies to meet the strong medical needs in the fields of autoimmunity and tumor treatment.
Tumor treatment is a key research area of Connoya. The company's products undergoing clinical trials also include CM355/ICP-B02 (CD20 x CD3 double antibody), CM336 (BCMA x CD3 double antibody), CM350 (GPC3 x CD3 double antibody), and CM369/ICP-B05 (CCR8 antibody, etc.). Among them, CM355, CM336, and CM350 are various bispecific antibodies developed based on the proprietary NTCe platform.
CM335 has more effective adaptability. In phase I/II clinical trials, all received ≥6mg? The 13 dose-treated patients achieved an ORR of 100%; of the 9 evaluable patients in the SC formulation group, the CRR reached 77.8%, of which 2 patients with DLBCL achieved CR.
CM336 is also continuing to advance phase I/II trials for relapsed/refractory multiple myeloma. Currently, it is in the dose escalation phase of phase I clinical studies. CM336 has high affinity for BCMA and strong anti-tumor activity. The company also carried out phase I/II clinical studies of CM350 to treat advanced solid tumors. Its advantage is that CM350 can induce a stronger TDCC mechanism and is currently in the phase I clinical dose escalation phase; it continues to promote phase I clinical studies evaluating CM369 for the treatment of advanced solid tumors and relapsed/refractory non-Hodgkin lymphoma.
7. Financial analysis: increase investment in R&D and have sufficient cash on hand
In 2023, the revenue was approximately RMB 354 million, mainly the cooperative income authorized by CMG901 to AstraZeneca; other revenue was mainly RMB 21.27 million in government grants; RMB 84.22 million in interest and financial management income; and $11.08 million in net exchange income. R&D investment for the full year of 2023 was about 600 million yuan, an increase of 18% over the previous year. R&D expenses were mainly distributed among employee remuneration and external R&D expenses. Operating expenses and fixed asset investment increased in 2023, totaling RMB 1,036 million. By the end of 2023, the total number of employees was nearly 900, including more than 370 in R&D and clinical operations departments, and more than 400 in CMC and production departments. The Chengdu production base could provide a total production capacity of 18,600 liters. The company's cash on hand (including short-term bank financial management) is RMB 2.7 billion, providing sufficient capital for subsequent R&D and product commercialization.
8. Future outlook: Accelerate drug research and development and promote commercialization. The company will actively promote the product commercialization process. The core product, CM310, is expected to be approved for sale by the end of this year and rapidly released in 2025, bringing rapid growth to the company's revenue. In terms of clinical trials, the company continues to provide leading innovative therapies to meet the clinical needs of patients. The core product CM310 for severe atopic dermatitis in adults is expected to be approved in Q4 2024, and plans to disclose long-term AD efficacy and safety data at the 2024 EAACI conference. CM310 has also reached a major endpoint in the treatment of chronic sinusitis with nasal polyps, and is expected to submit an NDA in Q3 2024. CM336 anticipates potential data readouts in 2024H2. Clinical trials of CM313 for multiple myeloma and treatment of SLE are progressing steadily, and potential data is expected to be read out in 2024H2.
The company's internal commercialization team is also being formed steadily, and is actively seeking and establishing sustainable partnerships to promote more opportunities for joint development cooperation for the company's self-developed products around the world.
9. Company profit forecast and valuation:
We expect the company's revenue for 2024, 2025, and 2025 to be 197 million yuan, 684 million yuan, and 1,311 billion yuan respectively, corresponding growth rates of -44.26%, 246.70%, and 91.61%, respectively, and net profit of -882 million yuan, -719 million yuan, and -518 million yuan, respectively. Considering the continued deepening of the company's self-developed new drug development, the efficient progress of clinical trials, and the increasing improvement of the commercialization team, it maintains a “buy” rating.