The Zhitong Finance App learned that CICC released a research report stating that it maintains the Cordi-B (02487) “outperforms the industry” rating and that the 2024-25 revenue and profit forecast remains unchanged. Based on the DCF model, the target price was lowered by 13% to HK$11, taking into account changes in market risk appetite and declining sector valuation center. The company recently announced that the marketing license application for CU-30101 (topical lidocaine tinocaine cream) was accepted by the State Drug Administration. As of July 30, 0.5858 million shares had been repurchased, accounting for about 0.19% of the total issued share capital, demonstrating management's confidence in the company's future development. Looking ahead, the bank believes that the company has good commercialization capabilities, that various pipelines are expected to be launched in 2H24-25, and is optimistic about medium- to long-term growth space.

The main views of CICC are as follows:

1. The online listing application for table hemp tubes was accepted, and the repurchase showed management's confidence.

According to the company's announcement on July 31, CU-30101 (topical lidocaine nicotinocaine cream) was accepted by the State Drug Administration in July after reaching the main end of the phase III clinical trial on January 31, 2024, and progress exceeded expectations. Due to the unique pharmacokinetic properties of its ingredients, the Lidocaine and Tetracaine combination formula of CU-30101 can produce a rapid and long-lasting anesthetic effect. Lidocaine disperses faster and more widely than tetracaine, while tetracaine is more lipophilic than lidocaine and can be concentrated in the stratum corneum of the epidermis. Currently, there are no compliant lidocaine products in the domestic market. The bank believes that the launch of subsequent products is expected to occupy a new blue ocean in the compliance market for topical anesthetics. Furthermore, since announcing the share repurchase plan on July 12, the company has purchased a total of 0.5858 million shares as of July 30, accounting for 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 management's confidence in the company's future development.

2. The business data for the first half of the year performed well, reflecting the company's ability to commercialize.

According to the company's announcement and official account, the company's 1Q24 revenue was 34.1 million yuan, or +123%. Among them, Bailleul's French small white tube Q1GMV increased 60% +, and the ROI exceeded 2.6, which turned a loss into profit for the first time without employee compensation; during the “618” period, the company's GMV exceeded 56.2 million yuan, an increase of nearly 5 times. Among them, the GMV for the hair pipeline and skincare product line respectively exceeded 21.5/34.7 million yuan, reflecting the company's good online operation and commercialization capabilities.

3. Various pipelines are expected to be launched in 2H24-25, and we are optimistic about medium- to long-term growth space.

① The NDA for topical use of minocycline (CU-10201) was accepted in September 23 and included in the priority review process, and the results of its phase III clinical trial in China were recently published online in the authoritative international dermatology journal JEADV. The company is expected to be approved in 2H24; ② The NDA for topical finasteride (CU-40102) in mainland China was accepted in January '24, and the company is expected to be approved in '25; ③ lidocaine (CU-30101) is expected to be approved in '25; lidocaine () is expected to be approved in '25. Furthermore, pipelines for thyroid hormone receptor agonists, recombinant mutant collagenase, and novel small-molecule drugs for external use are progressing smoothly. The bank is optimistic about the company's medium- to long-term growth space as a skin management platform.

risks

Product commercialization falls short of expectations; clinical progress falls short of expectations; risk of medical malpractice.