Morgan Stanley's first coverage research report indicates that Weisheng Pharmaceutical (2561.HK) ("Weisheng") is a strong growth-oriented company focused on endocrine treatment. Its unique origin background enables it to accelerate the advancement of its product pipeline, which has been validated overseas, and thereby capture the significant growth potential of the metabolic disease market in China without incurring the traditional costs of licensing for introduction.
Weisheng is developing three products derived from Ascendis, all based on the TransCon technology platform. The TransCon platform provides traditional daily hormone therapies with the potential for long-acting injections, significantly reducing the frequency of drug administration, thereby improving patient compliance and treatment outcomes. The high alignment of commercial interests between Weisheng and Ascendis allows it to acquire Ascendis' flagship products in a non-traditional manner—without the need to pay the usual milestone payments and sales sharing. This model significantly enhances Weisheng's profit potential, allowing it to stand out among many companies that primarily focus on introduction.
The bank holds an optimistic view on the quality of Weisheng's product pipeline and its commercial prospects in the China market. If favorable factors such as increased stimulating policies and alleviation of China-U.S. trade frictions emerge in the future, it will further drive the upward space of Company Valuation. Based on a forecast of 2.4 times P/S by 2030, the bank's Target Price for Weisheng is HKD 80, which means there is over an 80% upside potential compared to the current valuation. The bank believes that the company's current valuation does not fully reflect its significant commercial potential, and future upside should be driven by steady approval progress and efficient commercial execution.
