The company is a full-chain platform pharmaceutical company with deep innovation genes. The company's management team has rich industry experience. It has a forward-looking full-chain layout from R&D to commercialization, built four major platforms around core products, and adheres to a progressive innovation strategy from imitation to source innovation. The company has now approved 3 biosimilar drugs for marketing, and Nectin-4 ADC, a potentially best-in-class innovative product, is in critical phase III clinical trials. The company has formed a good echelon in the research pipeline, mainly covering the fields of oncology, autoimmune diseases, ophthalmology, etc.;

The focus is on ADC leading differentiated research and development, and the innovation pipeline is full of momentum. The company uses IDDCTM, a self-built ADC platform, to actively deploy ADC drugs. Currently, 3 ADC products have entered the clinical trial stage, including Nectin-4 ADC (9MW2821), TROP2 ADC (9MW2921), and B7-H3 ADC (7MW3711). Among them, Nectin-4 ADC has the second highest development progress in the world for UC (urothelial cancer), and was the first in the world to be disclosed in CC (cervical cancer), EC (esophageal cancer), and TNBC (triple negative breast cancer) With Data's Nectin-4 targeted drug, the company is expected to reap the first key results of innovation at the source. Judging from preclinical data, TROP2 ADC and B7-H3 ADC have advantages over the same target products, and are currently undergoing Phase I clinical trials. In addition, the company has also deployed competitive innovative products such as long-acting G-CSF, CD47/PD-1 dual antibodies, IL-11 monoclonal antibodies, ST2 monoclonal antibodies, and TMPRSS6 monoclonal antibodies;

The rapid commercialization of biosimilar products lays the foundation for cash flow with steady volume. With a full chain and forward-looking layout, the company took the lead in biosimilar development in the early days, and has successfully commercialized 3 biosimilar products.

Among them, adalimumab was approved in 2022, and 0.167 million units were shipped in 2023. Desulumab (osteoporosis) was approved in 2023, and 0.084 million units were shipped that year. Desumab (tumor bone metastasis) was approved as the first biosimilar of Agave in China on March 29, 2024.

We predict that the company's net profit for 2024-2026 will be -1.02, -0.594, and -0.16 billion yuan, respectively. We have made an absolute estimate of the company's free cash flow. The reasonable market value of the company is 13.7 billion yuan, and the corresponding target price is 34.28 yuan. For the first time, we have given an “increase in holdings” rating.

Risk warning

Innovative drug development progress falls short of expectations, biosimilar drug types entering collection, increased product competition or sales falling short of expectations, risk that the company's medium- to long-term profitability will decline, etc.