Incident: Recently, the company released its 2024 three-quarter report. In the first three quarters of 2024, the company achieved revenue of 0.299 billion yuan, or -0.89%, of which revenue from innovative anti-HIV drugs was 0.134 billion yuan, an increase of 188.51% year on year; net profit to mother -0.061 billion yuan; net profit after deducting non-return to mother -0.084 billion yuan.

The commercialization of HIV medicines is progressing steadily. In the first three quarters of 2024, the total sales revenue of new HIV drugs was 134.119 million yuan, an increase of 188.51% year on year; in the 3rd quarter, the total sales revenue of new HIV drugs was 52.4859 million yuan, an increase of 284.23% year on year. Through the commercialization of new HIV drugs, the company has established a commercialization operation system for new HIV drugs with company and product characteristics: the company has firmly promoted the implementation of the marketing idea of “medical leadership, market driving, and sales implementation”, and dynamically adjusts key marketing content and methods on the basis of adapting to changes in market pattern and demand, and is targeted. The company is also actively carrying out product registration related work in key countries and regions such as Africa and Southeast Asia, making every effort to promote the commercialization of innovative drugs at home and abroad.

The application for marketing of the Enomil tablets for new indications was approved, and the 96-week phase III clinical trial yielded positive results. Recently, the company received the “Drug Registration Certificate” approved and issued by the State Drug Administration, marking that the company's application for a drug registration and marketing license for the new indications of the innovative drug Compound (generic name: Enomide tablets) in the field of anti-AIDS has been approved. At the same time, the 48-96-week open extended phase study of enomil tablets for the treatment of HIV-1 infected people with stable conversion therapy in phase III clinical trials yielded positive results. The results showed that the virological inhibition rate for 96 weeks of treatment with Compubond was 96.6% (368/381), and the percentage of virologic suppression in the control group was 96.6% (364/377), indicating that the conversion of the integrase inhibitor regimen Acorn Protate tablets to Enomide tablets can still maintain a high level of virological suppression.

Investment advice: The company continues to cultivate an anti-HIV advantage circuit. We expect the company to achieve revenue of 0.566/0.812/1.094 billion in 2024-2026, maintaining an “gain” rating.

Risk warning: risk of changes in industry policies, risk of new drug development, risk of uncertain marketing of products under development, risk of poor progress in internationalization, risk of market competition, etc.