Incident: The marketing application for hemp cream products has been accepted. The company is expected to issue an announcement. The Group's CU-30101 (topical lidocaine decaine cream) drug marketing license application has been accepted by the State Drug Administration. The progress is expected to be the fastest among similar products in the market. Currently, the proportion of anesthetic products in compliance is low, and it is expected that after approval, it is expected to occupy a new blue ocean in the external anesthetic cream compliance market.
The company's CU-30101 is a topical lidocaine butacaine complex cuticle anesthetic cream specially designed for cutaneous cuticle surgery, utilizing the unique pharmacokinetic properties of its ingredients. The combination formula of lidocaine and tetracaine can produce a rapid and long-lasting anesthetic effect: lidocaine spreads rapidly and widely, while tetracaine can achieve a concentrated effect in the stratum corneum of the epidermis due to its lipophilic properties.
The clinical pipeline is progressing rapidly, and 2024H2-2025 is expected to launch 3 major products. Recently, the results of the Chinese phase III clinical trial of CU-10201 topical 4% minocycline foam were published online in the authoritative international dermatology journal JEADV, and the clinical pipeline is progressing frequently. 2024H2-2025 is expected to launch three major new products: the world's first and only 4% minocycline foam approved for external use, the world's first and only approved topical finasteride spray, and the first domestic lidocaine butacaine cream.
The 618 promotion showed strong performance. During the promotion period, GMV exceeded 56.2 million, and GMV increased nearly fivefold over the previous year. Among them, the hair pipeline GMV exceeded 21.5 million, and the skincare line exceeded 34.7 million. C-side marketing campaigns have achieved remarkable results, such as Xiaohongshu's S+ IP project “My Ten Healthy Habits”, sponsoring the hit drama “Between the Clouds” and other targeted hair campaigns during the 618 period.
Investment advice: The rapidly growing pan-dermatology treatment and care market is new, commercial-oriented and innovation-driven. ① The pioneering commercialization breakthrough is the company's 22-year partnership with France's Bailleul minoxidil spray, which is likely to exceed expectations in the early stages of growth; ② Cooperative high-end efficacy brand Omar and its own hair brand selenium disulfide have started significantly in 2023, which is expected to drive rapid iteration of the second curve; ③ In the future, it will quickly shift from a single drive to multi-matrix iteration from large French small white tubes. 24-26 will be an important landing point for major pipeline minocycline foam, topical phenasteride, and local anesthetic products. ④ Comprehensive pipeline layout and deep R&D reserves will drive the company to become a leading pan-dermatology platform enterprise.
Furthermore, the company announced a repurchase plan on July 12. As of July 30, it had repurchased 0.5858 million shares, accounting for about 0.19% of the total issued share capital, and the total amount of capital paid was HK$4.2072 million (not including transaction fees), demonstrating the company's confidence in long-term development. The company's short-term commercialization drives strong growth combined with high barriers on the long-term R&D side, and there is a possibility that it will exceed expectations in multiple dimensions. The estimated revenue for 2024-2026 is about 0.283/0.59/1.002 billion yuan, maintaining the “recommended” rating.
Risk warning: the risk that a single product accounts for too much revenue; the risk of increased competition in the industry; the risk that online commercialization progress falls short of expectations; the risk that the pipeline R&D process falls short of expectations.