Zhongtong Finance and Economics APP has learned that haitong int'l has released a research report stating that TCE is a special bispecific antibody that connects (or two ends connect) with TAA (tumor antigen) for locating tumor cells, and connects with the CD3 site of T cells to activate T cells to exert their tumor killing effect. Compared with ADC, which uses cytotoxins to kill tumors, TCE bispecific antibodies are essentially immunotherapies that activate T cells. Therefore, they require lower target expression levels than ADC, but higher tumor specificity. Compared with personalized and customized CAR-T therapies, 'Spot' TCE bispecific antibodies have advantages in convenience, accessibility and production costs. With the development and maturity of TCE bispecific antibody technology, more domestic enterprises will choose to lay out TCE bispecific antibodies to enter the field of solid tumors and autoimmunity. TCE bispecific antibodies have the potential to become the next investment trend in the field of immunotherapy.

Regarding symbols: we suggest paying attention to companies such as Innovent Bio (01801), Zelgen Pharmaceuticals (688266.SH), and Zhixiang Jintai (688443.SH).

Why do we need to pay attention to the TCE bispecific antibody field?

The market size of hematological tumors exceeds tens of billions of dollars, and there may be multi-billion dollar drugs for multiple myeloma: currently, a total of seven TCE bispecific antibody products for hematological tumors have been approved for marketing, covering targets such as BCMA, GPRC5D, CD20 and CD19, approved for multiple hematological tumor indications such as multiple myeloma and diffuse large B-cell lymphoma. Johnson & Johnson expects sales of both Talquetamab (GPRC5D/CD3) and Teclistamab (BCMA/CD3) to reach nearly $5 billion, and it is expected to use other drugs in the future to achieve comprehensive coverage from the end-stage to the frontline. These drugs have broad sales prospects.

The dawn of TCE bispecific antibodies in the field of solid tumors has appeared, changing the treatment pattern of small cell lung cancer. In recent years, approved indications for TCE bispecific antibodies have mainly focused on hematological tumors, while overcoming solid tumors has always been a major challenge for TCE bispecific antibodies. In 2024, with the outstanding clinical data of DeLLphi-301, the DLL3/CD3 bispecific antibody Tarlatamab developed by Amgen in the later SCLC line, achieving a 14-month overall survival rate (≥3 lines without standard treatment) and ultimately approved for marketing, Tarlatamab became the first TCE antibody that truly targets solid tumors. We believe that as POC (Proof of Concept) data on TCE bispecific antibodies targeting PSMA, DLL3 and other targets in solid tumors are successively released, the application direction of TCE bispecific antibodies is changing, and the harvest period of TCE bispecific antibodies in the field of solid tumors is approaching.

The field of autoimmunity is a big area where revolutionary research progress may occur in the future, and TCE therapy is gradually showing potential. Deep remission of B cells brings benefits to many autoimmune diseases such as neurological immunity (multiple sclerosis MS, myasthenia gravis gMG), rheumatism (SLE, Sjogren's syndrome, etc.), and kidney disease (lupus nephritis). With the long-term efficacy of CAR-T therapy in SLE becoming apparent, in overseas MNCs, Roche's CD20/CD3 bispecific antibody and Amgen's BCMA/CD3 bispecific antibody have successively conducted clinical trials of TCE bispecific antibodies in autoimmune indications, and TCE bispecific antibodies may open up broad space for autoimmune diseases. The number of pipeline License-out in China has significantly increased, and Tongrun Bio's CN201 (CD19/CD3 bispecific antibody) has successfully authorized Merck for $700 million initial payment, and has received MNC endorsement. Jiahao Bio's GB261 (CD20/CD3 bispecific antibody) has also successfully gone overseas.

haitong int'l pointed out that from the perspectives of target selection of TCE bispecific antibodies, platform characteristics, and structural design, the pain points of TCE bispecific antibodies mainly lie in: the risk of CRS and neurotoxicity; and off-target effects and immunosuppressive tumor microenvironments leading to the need to improve the therapeutic effect of solid tumors. The main future development directions are: to optimize the affinity of the CD3 end and the tumor antigen recognition arm to achieve a balance between efficacy and safety; to optimize target selection; to design bispecific antibodies specifically expressed in certain tumor environments to expand the therapeutic window (front-antibody technology, etc.); and to break through the immunosuppressive tumor microenvironment through combination therapy.