Yasheng Pharmaceutical is the leader in the apoptosis race, focusing on PPI and TKI small molecule drugs, with 12 innovative drug pipelines, 4 of which have the best-in-class BIC or the first-of-its-kind FIC potential, and is the only company with clinical research on all three known key apoptosis regulators. Yasheng Pharmaceutical has 12 FDA orphan drug qualifications ODD certification (the largest number of domestic pharmaceutical companies) and 1 rapid review qualification.
The market potential of apoptosis is huge and the threshold is extremely high. Apoptosis is a process of programmed cell death, which keeps the body healthy by removing aging and damaged cells. Apoptosis of cancer cells is usually inhibited or avoided. PPI preparations for apoptosis treat cancer by restoring the normal apoptotic process of cancer cells. The main endogenous apoptotic pathways include Bcl-2, IAP and MDM2-p53. Thanks to the significant biological significance of apoptosis therapy, in addition to monotherapy, it also shows a broad space in combination with TKI or IO therapy. Potential indications include solid tumor, hematoma, hepatitis B and other diseases. Falls estimates that global revenue from targeted apoptosis therapy will reach US $22 billion and 2021-30 CAGR:23.8% in 2030. In addition, the threshold for the research and development of apoptosis targets is very high, because macromolecular drugs are difficult to reach intracellular targets, and the binding sites are wide and shallow, protein-protein binding is difficult, and drug formation is difficult. At present, the products in clinical stage are very limited. Abowei venetoclax is the only PPI tumor-targeting drug on the market, with revenues of $1.337 billion in 2020.
A variety of pipelines have a bright future: APG-2575 (Bcl-2, potential BIC safety, drug administration is better than venetoclax,5 ODD, it is expected that 4Q21 will start key clinical registration), APG-115 (MDM2-p53 pathway, BIC potential, 5 ODD), APG-1387 (IAP/XIAP) cover three major apoptosis pathways, and the progress is leading. It is worth noting that the animal model test of "synthetic lethal" strategy combined with APG-115 and APG-2575 achieved complete remission, which was significantly better than that of single drug, and had strong synergistic effect. The fastest-growing pipeline, HQP1351 (third-generation BCR-ABL), has been proposed to be included in a breakthrough treatment variety by NMPA and is expected to be conditionally listed in the near future. INNOVENT BIO (01881.HK) in the form of cash + equity + milestone payment won HQP1351 50% of the Chinese market co-promotion profits and APG-2575 combination therapy cooperation, showing a high degree of recognition of the company's R & D capabilities and development potential, but also help to reduce risks and share costs.
Investment suggestion: we are optimistic about the company's R & D strength and commercial prospects in the field of apoptosis, as well as the conditional listing of short-term catalyst HQP1351. Buy is recommended.