Description of the event

On April 30, 2024, Junshi Biotech released its report for the first quarter of 2024: The company achieved operating income of 381 million yuan in the first quarter of 2024 (+49.24% year-on-year) and realized net profit of -283 million yuan (-543 million yuan for the same period last year).

Incident comments

Revenue in the first quarter increased significantly year-on-year, and treprilizumab continued to tap commercial potential. In the first quarter of 2024, the company achieved operating income of 381 million yuan, a year-on-year increase of 49.2%; realized net profit to mother of 283 million yuan (-543 million yuan in the same period last year), and losses further reduced. The core product PD-1 monoclonal antibody, triplimab, has been approved by the FDA for marketing in the US for 1L/2L treatment of nasopharyngeal cancer. It has become the first and only drug approved for nasopharyngeal cancer treatment in the US, and the first innovative biopharmaceutical independently developed and produced by the FDA in China. The approved indications for treipril in China continued to expand, and 3 new indications were added to the 2023 national health insurance catalogue. Currently, 6 indications are included in the national health insurance catalogue. In addition, domestic indications for treprilizumab are also continuing to expand. Applications for new indications for perioperative treatment of patients with non-small cell lung cancer have been approved by the State Drug Administration, and applications for new indications for advanced triple-negative breast cancer treatment, advanced renal cell cancer first-line treatment, and first-line treatment for extensive small cell lung cancer have been accepted by the National Drug Administration.

The pipeline continues to progress in the later stages, and BTLA monoclonal antibodies still have global FIC potential. The world's first first-in-human (first-in-human) anti-BTLA monoclonal antibody tifcemalimab combined with treprilimab as a randomized, double-blind, placebo-controlled, international multi-center phase III clinical study for patients who have not progressed after limited-stage small cell lung cancer radiotherapy has completed the world's first patient enrollment (FPI) and first administration. The randomized, open, positive-controlled, multi-center phase III clinical study of tifcemalimab for the treatment of cL has officially started; The new drug marketing application for the recombinant humanized anti-PCSK9 monoclonal antibody injection angerisimab has been accepted by the National Drug Administration; the recombinant humanized anti-IL-17A monoclonal antibody has entered phase III registered clinical research. Preliminary phase I/II clinical study data of tifcemalimab for broad-stage small cell lung cancer was released at the 2023 ASCO conference: Among 20 patients whose efficacy could be assessed, tifcemalimab combined with treprilimab had an ORR of 40.0%, DCR of 70.0%, and mPFs of 5.5 months, showing good treatment potential.

In the early stages of the pipeline, the company will continue to focus on products such as Claudin18.2 ADC drug JS107, PI3K-α oral small molecule inhibitor JS105, siRNA drug JS401 targeting ANGPTL3, anti-CGRP monoclonal antibody JS010, CD20/CD3 bispecific antibody JS203, PD-1/VEGF bispecific antibody JS207, PD-1 monoclonal antibody subcutaneous injection preparation JS001sc.

Profit forecast and investment advice: The company's net profit for 2024-2026 is estimated to be -1,691 billion yuan, -977 million yuan and -150 million yuan respectively, corresponding to EPS of -1.72 yuan, -0.99 yuan and -0.15 yuan, respectively, maintaining the “buy” rating.

Risk warning

1. The R&D progress falls short of expectations or the risk of R&D failure;

2. Risk of increased product competition or further price reduction;

3. The risk that the commercialization of products overseas does not meet expectations.