Key points of investment:
It is estimated that sales of sidabendamide hematoma will exceed 1 billion yuan, and sales of solid tumors will increase by more than 2 billion dollars. Sales revenue of sidabendine in 2023 is 467 million yuan, mainly contributed by PTCL. In July '23, the marketing application for sidabenamide combined with R-CHOP for first-line treatment of MYC/BCL2 dual-expression DLBCL was accepted and included in priority review. It is expected that 2024H1 will be approved for marketing and participate in health insurance negotiations in '24. It is estimated that sales of sidabendamide in hematoma peaked at more than 1 billion yuan, contributing to stable cash flow to the company.
Phase II data on the three-drug regimen sidabenamide+cindilizumab combined with bevacizumab for advanced MSS/PMMR colorectal cancer showed a significant improvement in efficacy compared to third-line standard therapy. The company plans to submit a registered phase III clinical IND for three-drug combination treatment for advanced colorectal cancer within 2024. Currently, the three-drug combination plan has the potential to be more effective than the standard treatment plan. We estimate that colorectal cancer indications have increased sales by more than 2 billion yuan. Theoretically, sidabendamide combined with immunotherapy has a certain degree of universality and has great potential for use in solid tumors. It is expected that first-line non-small cell lung cancer stage II clinical data with sidabendamide plus tirelizide will be read out within 24 years.
The dosage of siglitazide was accelerated after entering medical insurance. Starting in NASH clinical phase III in 2024 is a new mechanism insulin sensitizer independently developed by the company. It is the first PPAR full agonist approved in the world to treat type 2 diabetes. In 2023, sales revenue of sitaglita sodium type 2 diabetes was 42.25 million yuan, which is estimated to correspond to about 20,000 patients. Assuming that 700,000 patients were treated in 2033, the sales peak is expected to exceed 1 billion yuan. Among the successful clinical targets of overseas NASH, pan-PPAR is the target with the best efficacy of oral administration of small molecules. The company expects NASH phase II clinical data to be read out within 2024, and NASH phase III clinical trials will be initiated within 24 years.
Theoroni is the benchmark for anlotinib. Combined chemotherapy and immunotherapy are future growth points. Theoroni and Chia Tianqing's anrotinib are both highly selective inhibitors of VEGFR/PDGFR/c-Kit/csf1r targets. At the same time, Theoroni has inhibitory activity against the cell cycle target Aurora B.
The treatment of small cell lung cancer with Theoroni as a single agent and treatment with paclitaxel for refractory or platinum-resistant ovarian cancer has entered stage III. The company expects to officially submit marketing applications for small cell lung cancer indications within 2024, and estimates that the sales peak for the above 2 indications will exceed 500 million yuan. As the company independently develops innovative drugs with global rights, Theoroni has the potential for overseas licensing. Single drug treatment for small cell lung cancer has been certified as an orphan drug by the FDA, and phase IB/II clinical trials are currently being conducted in the US.
Profit forecasting and investment advice
We expect the company's 24-26 revenue of 6.76/9.38/1,235 million, a year-on-year growth rate of 29%/39%/32%. According to the DCF valuation model, it is estimated that the reasonable market value of the company's stock price is 3301 yuan, and the reasonable value is 13.6 billion yuan. First coverage, giving a “buy” rating.
Risk warning
The risk of product development failure, the risk of product sales falling short of expectations, and the risk of generic drugs appearing when patent rights expire.