Core views
The company released the latest clinical trial data for two innovative products in advanced cancer patients.
Overall, ZGGS18 has shown good safety and initial efficacy in patients with solid tumors, and clinical progress continues. ZG005 showed initial efficacy in 21 cervical cancer patients, with an ORR of 43% and a DCR of 81%. At the same time, at the target dose of 20 mg/kg, the ORR value for cervical cancer patients was as high as 63%, and the results were impressive. We believe that the commercialization of the company and clinical promotion go hand in hand, and the future can be expected.
occurrences
The company released clinical data of ZG005 (PD-1/TIGIT dual antibody) and ZGGGS18 (VEGF/TGF-beta dual antibody) and a brief review of the latest developments
ZG005 has excellent curative efficacy in cervical cancer patients. Follow-up solid tumor data can be expected on May 24. The company released phase I/II clinical study data on dose escalation, tolerability, safety, pharmacokinetics, and multiple cohort expansion of ZG005 in advanced solid tumors and the latest developments: As of April 16, 32 subjects were included in the dose escalation phase of the clinical trial, and a total of 47 subjects were enrolled in the dose expansion phase. Of the 79 subjects, 43% had previously been treated with at least two lines of antineoplastic drug systems, and 48% had previously been treated with PD-1/PD-L1 inhibitors.
ZG005 has shown excellent efficacy in cervical cancer patients. In this phase I/II clinical trial, a total of 21 cervical cancer patients were able to evaluate efficacy. Among 21 patients, ORR was 43% and DCR was 81%. At the target dose of 20 mg/kg, the ORR value for cervical cancer patients was as high as 63%. As of the data cutoff date, 16 subjects were still receiving treatment. We believe that the company's ZG005 has shown excellent efficacy and good safety in cervical cancer patients. As the product continues to advance in subsequent clinical trials, more solid tumor data is worth looking forward to.
ZGGS18 showed initial efficacy in solid tumors, and subsequent clinical trials continued to advance ZGGS18 to show initial efficacy in solid tumors: among 19 patients with advanced solid tumors, ORR and DCR were 5.3% and 42.1%, respectively. In terms of safety, 81.0% (17/21) of subjects experienced treatment-related adverse events (TRAEs), the vast majority being grade 1 or 2. Overall, ZGGS18 has shown initial efficacy data and good safety data in patients with solid tumors, and subsequent clinical trials will continue to advance.
Commercial products continue to advance, and future innovative drugs are worth looking forward to
Recombinant human thrombin: The company's recombinant human thrombin was approved for listing by CDE. At the same time, the company signed a cooperation agreement with Yuanda Life Science, a wholly-owned subsidiary of Yuanda Life Sciences Group Co., Ltd., and received a down payment of 260 million yuan in March 2024. We believe that recombinant human thrombin is effective and safe and can fill the gap in the domestic market for intraoperative ischemia. With the active development of provincial and municipal networks, hospital admission, and academic promotion, subsequent commercialization of the product can be expected.
Jacketinib: The company's Jacketinib has submitted a listing application to the CDE, and the product is expected to be approved for listing in 2024. According to company data, it is estimated that there will be 63,000 new cases of myelofibrosis in China every year by 2030, and the number of patients in stock is estimated to be about 300,000. According to jacketinib's previous friendship effects on myelofibrosis patients in phase III clinical trials, the product is expected to become a BIC drug for this indication. Commercialization can be expected after subsequent listing.
Injectable recombinant human thyroid-stimulating hormone: The product has reached an end in phase III clinical trials for adjuvant diagnostic indications after surgery and will soon be submitted for marketing. The incidence rate of thyroid cancer patients in China has increased markedly in recent years. In 2022, there were about 4661 thousand new cases of thyroid cancer in China. It is currently the third most common malignant tumor in China. The company's injectable recombinant human thyroid-stimulating hormone can fill gaps in thyroid diagnosis and treatment, improve patient survival rate and survival time, and is expected to provide more help to patients with thyroid cancer.
In the follow-up pipeline, the company's drugs such as ZG005 (PD-1/TIGIT), ZG006 (CD3/DLL3), and ZGGGS18 (VEGF/TGF-beta) are all in continuous clinical promotion, and the subsequent clinical results of the products are worth looking forward to.
2024 has many catalysts
Overall, the company has many catalysts for 2024. ① Jacketinib is expected to be approved for marketing in 2024. ② More solid tumor data on ZG005 is expected to be disclosed in the second half of 2024. ③ Early solid tumor data on ZG006 is expected to be disclosed in the second half of 2024. ④ Phase III clinical data on alopecia areata indications are expected to be read out within the year.
Profit Forecasts and Investment Ratings
The company's product pipelines in many different treatment fields have entered or are about to enter the commercialization stage. At the same time, the subsequent pipeline continues to advance, and the overall development is steady.
We estimate that in 2024-2026, the company's revenue will be 623 million yuan, 1,541 million yuan, and 2,381 billion yuan, respectively. According to the DCF model, we expect the company to have a reasonable market value of 17 billion yuan, a target price of 64.07 yuan, and a “buy” rating.
Risk analysis
The risk of uncertainty in the development of new drugs. As a technological innovation, new drug research and development has the characteristics of a long R&D cycle, high investment, high risk, and low success rate. From laboratory research to approval of a new drug for marketing, it has to go through many complex steps such as pre-clinical research, clinical trials, new drug registration and marketing, and after-sales supervision. Every step may face the risk of failure. There is also a risk that existing products or treatments will be replaced by new treatments and technologies.
Commercialization risks. Health insurance fee controls have exceeded expectations, causing the pricing of innovative drugs to fall short of expectations; although the company has exclusive varieties in the release stage, competition in the self-exempt drug market is fierce. At the same time, thrombin sales are in the early stages of climbing, so there may be a risk that sales share will fall short of expectations or sales expenses will be higher than expected.