Event: On June 12, 2024, the marketing application for a new indication of treprilimab for first-line treatment of broad-stage small cell lung cancer was approved.
Comment: This is the ninth indication for Trepri to be approved for marketing, which means that the pace of dosage for major domestic indications is gradually speeding up.
1) Treprilimab became the first PD-1 inhibitor to obtain positive results for both PFS and OS in key clinical studies of ES-SCLC, which means that the studied drug showed positive effects in extending survival time and delaying disease progression. It was awarded the “CSCO Small Cell Lung Cancer Diagnosis and Treatment Guidelines (2024 Edition)” Level III recommendation (Class 1A evidence) and the “CSCO Immune Checkpoint Inhibitor Application Guidelines (2024 Edition)” Level II recommendation (Class 1A evidence). The results were based on the EXTENTORCH study. The final PFS analysis showed that compared with simple chemotherapy, treprilizumab combined chemotherapy significantly improved patients' PFS (mPFS was 5.8 months vs. 5.6 months), and the risk of disease progression or death was reduced by 33.3%. The final OS analysis showed significant survival benefits (MoS was 14.6 months vs. 13.3 months) and the risk of death was reduced by 20.2% compared with chemotherapy alone.
2) The annual cost of treatment is low, and the market share is expected to increase rapidly after marketing. Currently, the unit price of treprel is 1884.86 yuan/240 mg. According to the EXTENTORCH recommended dosage cycle (Q3W) and mPFs, we estimate that the annual cost of trepri for ES-SCLC treatment is about 14,600 yuan, which is currently the least expensive immunotherapy for ES-SCLC. Given that Trepril's treatment of ES-SCLC simultaneously reached dual endpoints and lower annual costs, we believe that tripril will rapidly increase its market share after marketing, and it is predicted that the peak sales value of trepril for this indication could reach 338 million yuan.
3) Treprilizumab has been approved for three indications for lung cancer, and the pace of dosage for major domestic indications is gradually accelerating. In September 2022, the first-line treatment of tripril combined with pemetrexed and platinum for patients with negative epidermal growth factor receptor (EGFR) gene mutation and anaplastic lymphoma kinase (ALK) negative, locally advanced or metastatic non-squamous non-small cell lung cancer was approved; in December 2023, perioperative treatment with chemotherapy, followed by this single drug as adjuvant treatment for adult patients with stage IIIA-IIIB non-small cell lung cancer; and this time, extensive small-cell lung cancer was approved., it can be seen that trepri covers a large range of indications It is beginning to gain strength. Combined with Q1 results in 2023 and 2024, the increase in sales of Trepri suggests a gradual acceleration in the pace of its dosage for large indications.
Profit forecast: We expect the company's 2024-2026 revenue to be 17, 32, and 4.25 billion yuan, respectively, with year-on-year growth rates of 13.14%, 88.24%, and 32.81%, respectively, and net profit to mother of -18.42, 0.41, and 805 million yuan, respectively. The year-on-year growth rates are 19.34%, 102.21%, and 1880.33%, respectively, maintaining the “Highly Recommended” rating.
Risk warning: risk of clinical failure, risk of increased competition, risk of product sales falling short of expectations, policy risk.