Incident Overview
The company's 2023 annual report: The company achieved operating income of 17.42 billion yuan, an increase of 82.13% over the same period of the previous year; realized a net loss of 6.72 billion yuan, a decrease of 6.93 billion yuan over the same period of the previous year; during the reporting period, the Group's net cash flow from operating activities was -7.79 billion yuan; during the reporting period, the Group's annual R&D investment was 12.81 billion yuan, an increase of 14.90% compared with the same period last year. R&D investment is used for pre-clinical research, clinical trials, cooperative R&D, etc. of the product pipeline.
Analytical judgment:
Sales revenue of antineoplastic drugs increased compared to the previous year, mainly due to Baiyueze? Sales increased in the US, Europe, and China, as well as Baizean's sales in China.
The increase in sales expenses was mainly due to continued investment in global commercialization during the reporting period. The increase in management expenses is mainly due to the increase in expenses brought about by the expansion of the scale of operations and the expansion of the organizational structure. The increase in R&D costs is mainly due to an increase in R&D investment for clinical and pre-clinical drug candidates as the global R&D pipeline expands.
On the product side, many models have been approved in overseas markets, and R&D reserves are abundant
On April 23, 2024, the company announced that the European Commission (EC) has approved Baizean?
It is used for first-line and second-line treatment of three non-small cell lung cancer (NSCLC) indications. Baize-an? The approved indications are: (1) combination with paclitaxel and carboplatin or injectable paclitaxel (albumin binding) and carboplatin for first-line treatment of adult patients with locally advanced or metastatic squamous non-small cell lung cancer unsuitable for surgical resection or chemoradiotherapy; (2) combination with pemetrexed and platinum chemotherapy for PD-L1 expression ≥ 50% and no epidermal growth factor receptor (EGFR) or anaplastic lymphakinase (ALK) positive mutations; unsuitable for removal or chemotherapycontaining platinum First-line treatment for adult patients with locally advanced or metastatic non-squamous non-small cell lung cancer; (3 ) Monotherapy is used to treat adult patients with locally advanced or metastatic NSCLC after previous treatment with platinum-containing drugs.
NSCLC patients with EGFR mutations or ALK mutations positive should have received targeted therapy prior to receiving tirelizumab therapy.
On March 15, 2024, the company announced that the US Food and Drug Administration (FDA) has approved Baizean? As a monotherapy for adult patients with unresectable or metastatic esophageal squamous cell carcinoma (ESCC) after previous systemic chemotherapy (without PD-1/L1 inhibitors). Tirelizumab is expected to be marketed in the US in the second half of 2024.
On March 8, 2024, the company announced that Baiyueze was granted accelerated approval by the US Food and Drug Administration (FDA) to treat adult patients with recurrent or refractory (R/R) follicular lymphoma (FL) in combination with the anti-CD20 monoclonal antibody otuzumab.
The company's extensive pipeline also includes self-developed products with best-in-class or first-of-its-kind potential, including the BCL-2 inhibitor sonrotoclax and the BTK-targeted chimeric degradation activating compound (CDAC) BGB-16673, both of which showed potential in early data. The company pipeline also includes many early products, such as products targeting pan-KRAS, PRMT5, CDK4, CDK2, etc., as well as B7H3-ADC, CEA-ADC, B7H4-ADC, MUC1×CD16A Specific antibodies and Claudin6×CD3 bispecific antibodies have also been invested in the construction of technical platforms including CDAC proteolytics, bispecific antibodies, tri-specific antibodies, ADC, cell therapy, mRNA, etc.
Investment advice
Taking into account the continuous approval of new global indications and the rapid release of products after approval, we adjusted the early profit forecast, that is, we forecast that the company's revenue for 2024-2026 will be 222.6/283.7/35.12 billion yuan (previous value 225.4/308.9/100 million yuan), up 27.8%/27.4%/23.8% year on year, and net profit to mother of -49.51/-20.97/3.133 billion yuan, respectively (previous value -6.970/ -40.55/- billion yuan), up 26.3%/57.6% year on year /249.4%, EPS was -3.64/-1.54/2.31 yuan (previous value -5.08/-2.05/- yuan), corresponding to the closing price of 130.77 yuan/share on April 26, 2024, PE was -36/-85/57 X, respectively. Considering that the company's performance had a lot of room for growth, it maintained a “buy” rating.
Risk warning
New drug development falls short of expectations, there is a risk that global cooperation will be interrupted, and commercialization performance after product launch falls short of expectations