We have plenty of cash on hand, and research and development continues to increase. Revenue in 2023 was 562 million yuan, -20.11% year-on-year; net profit attributable to mother - 780 million yuan; non-net profit deducted from mother - 813 million yuan. The main reasons for the decline in profits include: changes in market demand and the impact of collection; continuous promotion of research and development of innovative drugs, with a sharp year-on-year increase in R&D costs; and rising prices of Chinese herbal medicines and some packaging materials due to the impact of the raw materials market. 2024Q1 achieved revenue of 5.462 billion yuan, +4325% year-on-year, net profit of 5.05 billion yuan, net profit of non-return to mother of 5.04 billion yuan. The sharp increase in revenue and profit was mainly due to receiving an initial payment of 800 million US dollars from BMS. Cash in hand is 5.826 billion yuan.
B01D1 The process of globalization is accelerating. According to the Clinicaltrial, B01D1 has initiated 6 domestic phase III clinical trials, which are used to treat EGFR mutation NSCLC, wild NSCLC, terminal nasopharyngeal cancer, second-line esophageal squamous cell carcinoma, second-line HR+HER2-BC, and second-line TNBC; at the same time, according to the company's 2023 annual report, its single-agent treatment for nasopharyngeal cancer has been recognized as a CDE breakthrough therapy.
In terms of overseas clinical development, global multi-center Phase I clinical trials for NSCLC are being enrolled.
BMS is exclusively responsible for the development and commercialization of BL-B01D1 in regions outside mainland China, which is expected to accelerate the internationalization process of B01D1.
The research pipeline is progressing smoothly. In terms of ADC, BL-M07D1 compared to T-DM1 for HER2-positive BC is in domestic phase III, and the US phase I treatment for HER2-positive solid tumors is being enrolled; BL-M02D1 is in domestic phase IB/II; and BL-M11D1 and BL-M05D1 are in domestic phase I.
In terms of double/multiple antibodies, SI-B001 (EGFRXHER3) is in domestic phase III, and domestic phase I with docetaxel has also been approved by the FDA; SI-B003 (PD-1XCTLA-4) is in domestic phase II; and GNC-038, GNC-039, and GNC-035 are in domestic phase I/II.
Profit forecasting and investment advice. The company's 2024-2026 EPS is expected to be 10.04, 0.21, and 0.03 yuan respectively, mainly due to stock business sales, confirmation of BD-related down payments and milestone payments, and increased R&D investment. We continue to be optimistic about the global competitive potential of B01D1. Using the DCF valuation method, the reasonable value of the company was obtained at 209.30 yuan/share, maintaining a “buy” rating.
Risk warning. Risk of R&D failure, product sales falling short of expectations, market competition exceeding expectations, etc.