Recently, Weisheng Pharmaceutical (02561) had in-depth discussions with investors regarding the company's fundamentals and the development status of its core product pipeline.
According to Zhitong Finance App, recently, Vysinger Pharmaceuticals (02561) had in-depth communication with investors regarding the company's fundamentals and the development status of its core product pipeline. Below are the minutes from this roadshow:
Long-acting growth hormone (Best in class)
Growth hormone is a market worth over 10 billion in China, primarily based on out-of-pocket expenses. About 2/3 of the growth hormone market is covered by Private Hospitals and clinics, where the pharmaceuticals do not meet the national health insurance reimbursement criteria; the remaining 1/3 is covered by public hospitals, with only a small portion of patients eligible for national health insurance reimbursement, which may not cover the full cost. Currently, short-acting growth hormone has been included in the insurance directory, but only a few patients can enjoy insurance reimbursement. The products introduced by the company in the future will mainly target the out-of-pocket market and will not participate in insurance negotiations to retain pricing autonomy.
Sales of growth hormone mainly come from non-public, private, and Private Hospitals. The entry requirements for these medical institutions are relatively lenient, the speed of product adoption is fast, and they are not affected by national bulk purchasing policies. Currently, the mainstream growth hormone products include short-acting water injections (annual treatment costs about 0.06-0.07 million yuan), short-acting powder injections (annual treatment costs about 0.02-0.03 million yuan), and long-acting formulations (annual treatment costs about 0.12 million yuan). Although existing products have similar efficacy, the market's acceptance of long-acting formulations is rapidly increasing. According to 2023 data, existing products have similar efficacy, with sales of long-acting growth hormone reaching approximately 2.9 billion yuan, accounting for 1/4 of the total market sales. Long-acting is the fastest-growing segment, with parents more willing to pay relatively high costs for more convenient treatment options, and this market is not absolutely price-sensitive.
Looking ahead, the sustained growth momentum of the growth hormone market will mainly come from the conversion of short-acting products to long-acting products. It is expected that by 2030, the market size will grow to 30 billion yuan, with long-acting formulations holding a dominant market share. The company has clear technological advantages in the long-acting growth hormone field, with its products considered the best in terms of clinical data performance in the current market.
The growth hormone market has high concentration, showing a clear trend of centralization in both urban distribution and coverage of medical institutions. Nationwide, the number of pediatric endocrinologists prescribing growth hormones is limited to only a few thousand, which makes market promotion efficiency relatively high.
From a competitive landscape perspective, competition in the growth hormone field is relatively mild, especially since the research and development barriers for long-acting formulations are extremely high. Compared to competition in fields like PD-1 and GLP-1, the technical threshold for the long-acting growth hormone market is even higher. Short-acting growth hormone has existed for 40 years, with over 30 long-acting formulation projects previously failing. The polyethylene glycol (PEG) technology has seen multiple failures in the international market, with reasons for failure including the inability to confirm an effective dosage in the clinical phase II, or issues related to efficacy and safety. To date, no PEGylated long-acting growth hormone products have been approved for marketing in the USA and Europe. Furthermore, the company’s product is the only one to achieve superior results in head-to-head trials against Japanese formulations. Additionally, related products from Novo-Nordisk A/S and I-Mab are waiting for approval, but the company is in a leading position in market competition thanks to its technological and clinical data advantages.
The company's products have significant technological innovations and market advantages. The products are a long-acting formulation administered once a week, with a molecular structure identical to that of natural growth hormone, achieving the same biological activity as natural molecules. Currently, this product has been approved in the USA and Europe, is in the approval stage in the domestic market, and is awaiting approval in Japan. The product has obvious advantages in convenience; typically, biologics must be stored at 2-8°C and can only be preserved for two years, while the company's product can be stored for five years at 2-8°C and for six months at room temperature.
The temporary linking technology used in the company's products temporarily connects the growth hormone molecules with inert carrier molecules (PEG) to form an inactive prodrug. The growth hormone molecules are cleverly wrapped and protected by the inert carrier, and after the prodrug is injected into the body, this design allows the growth hormone to avoid being degraded by the body's fast metabolism mechanisms and receptor-mediated clearance, thereby extending its residence time in the body for long-acting effects. This technology optimizes the product's storage characteristics and safety while retaining efficacy. Compared to similar products from international pharmaceutical companies, the company's product has demonstrated significant superiority in head-to-head trials against the daily formulation (with Novo-Nordisk A/S as the control).
The mechanism of action of growth hormone involves two target organs: the liver and the growth plate. The liver is the main target organ for growth hormone, and even if the molecular structure changes, it can still maintain its effects in the liver. The growth plate, lacking blood supply, requires the drug to penetrate on its own to be effective. The molecular weight of natural growth hormone is about 22kDa, enabling effective penetration into the growth plate, while larger growth hormone analogs with higher molecular weights cannot reach the growth plate, thus affecting their efficacy.
The molecular weight of the active ingredient released after the company's product is injected into the body is 22kDa, consistent with that of natural growth hormone, effectively targeting the growth plate. In contrast, other permanently bound products have molecular weights exceeding 40kDa, and drug molecules increased to a certain extent have difficulty entering the growth plates, which lack blood supply, thus impairing their binding with growth hormone receptors in the growth plate, significantly reducing their growth-promoting effects. Moreover, compared to daily formulations, the company's product has 100% affinity for growth hormone receptors, while permanently modified growth hormone products have lower affinity, only 1/30 that of natural growth hormone. In pharmacokinetics, the peak concentration reached with weekly injections of the company's product is comparable to the peak blood concentration of daily injected formulations, with consistent AUC (drug exposure), ensuring efficacy while avoiding risks associated with overdosing; conversely, permanently modified growth hormone products need to reach 16 times the peak blood concentration and 48 times the AUC of daily formulations to achieve therapeutic effects. Overall, the company's long-acting growth-promoting factor significantly outperforms other long-acting products.
Currently, approximately 80% of the growth hormone market share is held by JinSai, with its product advantages mainly stemming from the short-acting powder injection approved in 1998 and the short-acting water injection approved in 2005. In terms of commercialization, WeiSheng Pharmaceutical has an experienced core team focused on accelerating the market transition from short-acting to long-acting products. After the launch of the company's products, it has the potential to disrupt the market due to its advantages in efficacy, safety, and convenience.
Commercialization strategies include the following aspects:
1. Parental demand: Parents have significant decision-making power in treatment options, and the company's products can attract more patients due to their efficacy and convenience.
2. Physician coverage: The number of pediatric endocrine doctors in the country who can prescribe growth hormone is limited, only several thousand. By accurately targeting this core group of doctors, the company can efficiently promote its products.
3. Channel cooperation: The company has signed a global cooperation agreement with United Family Hospital and reached a strategic agreement with Shanghai Pharmaceuticals to further expand market channels.
4. Patient services: Due to the long treatment cycle for growth hormone therapy (usually 1-2 years), the company plans to build high-quality after-sales services to enhance patient experience.
Currently, the number of patients using growth hormone therapy domestically is 0.3-0.5 million, covering just 0.1 million patients could form a market size of over 10 billion. Through technological innovation and precise commercial strategy, the company is expected to occupy a leading position in this high-growth market, with products expected to be approved in the second half of 2025.
Navitopag (First in class)
Navitopag is a potential first-in-class disease repair therapy for children with chondrodysplasia in relevant regions. Currently, there are no similar products approved in the country, and no other companies are conducting related research and development. There are about 0.05 million patients with this disease nationwide, including 0.01 million children, who need to continuously receive medication during their growth and development. Obtaining national rare disease certification, it is expected to enjoy policy benefits and directly submit applications for market launch. The company plans to design the drug's indications to cover the entire growth and development stage from diagnosis in childhood up to 15 years old. Given that the patient's treatment cycle lasts for more than a decade and the market's exclusivity is significant, this product is expected to achieve hundreds of millions in annual sales in the future.
Parathormone (First in class)
Parathormone is the first hormone replacement therapy for hypoparathyroidism. The half-life of natural parathyroid hormone is only a few minutes, while the company has innovatively extended the half-life of the hormone to 65 hours, significantly improving treatment efficacy. The average age of onset for this disease is in the 30s, and it is estimated that the target patient population for Parathormone is around 0.4 million, requiring long-term treatment that could last for decades. Currently, no other companies are conducting related clinical research, and the company’s product, due to its innovation and long-term treatment needs, is expected to bring sustained high revenue.
Experts in pediatrics interpret Longpeic growing promoting hormone.
Main advantages:
1. Reported at major domestic pediatric medicine conferences demonstrating its excellent efficacy, already approved by the FDA in the USA.
2. The first results validated by well-designed Phase 3 clinical trials at home and abroad, as well as systematic evaluations confirming that its efficacy is superior to the long-acting growth hormone made in Japan.
3. Ingredients are safe and reliable, free from preservatives.
4. Convenient storage, can be stored at room temperature.
Focus from the perspective of clinical doctors: 1. Safety 2. Efficacy 3. Convenience.
Patient compliance is an important factor affecting efficacy. Clinical observations have shown that there is a more common occurrence of missing doses with the formulation made in Japan, with children resisting medication, significantly affecting efficacy. The acceptance rate of the formulation made in the USA is high.
In comparison to long-acting growth hormones using permanent bonding technology, the molecular weight is too large, with weak permeability, unable to penetrate the growth plate, unstable concentration in the body, and poor effects. Longpei growth hormone uses "temporary connection" technology: by using an inert carrier for "connecting" to wrap and protect the prototype drug, it avoids rapid clearance of the drug from the body, achieving a long-lasting effect; at the same time, it avoids permanent alteration of the growth hormone's molecular structure through the "temporary" approach. After injection of the product into the body, it continuously releases amino acid sequences consistent with the endogenous growth hormone in a controlled manner.
Phase III clinical trials showed that this product is more effective than short-acting formulations. Safety results demonstrated that the tolerance for Lonapegsomatropin is good, with safety characteristics comparable to daily growth hormone preparations. In the extended phase of international trials, patients receiving treatment for as long as 6 years, with an average treatment duration of 4.1 years. The data results from this trial indicated a continuous increase in height SDS among the children, proving the long-term effectiveness of Lonapegsomatropin treatment, with children's height percentile increasing from P5 to P36 (exceeding the average parental height SDS). It is the first long-acting growth hormone confirmed to be more effective than daily formulations through well-designed Phase III clinical trial results and systematic evaluations verified domestically and internationally.
In clinical observations regarding patient convenience, Lonapegsomatropin utilizes an optimized freeze-dried powder formulation that can be stored at room temperature for 6 months. The syringe design is compact and easy to use, making it suitable for a variety of scenarios, which is an important concern for parents of patients. The target patient demographic has good economic conditions and strong payment capability, aligning well with the product positioning. Both doctors and patients have high expectations for the launch and use of Lonapegsomatropin.
Q&A
Q: What are the indications for Lonapegsomatropin?
A: For growth hormone deficiency, a comprehensive evaluation including multiple indicators such as growth hormone levels and bone age must first be conducted. Each indicator should be re-evaluated every 3 months during medication to monitor effectiveness and ensure drug safety. In addition to growth hormone deficiency, there are plans to apply for indications for several conditions such as idiopathic short stature in the future, aimed at treating different diseases, starting from those over 1 year of age and weighing 11.5 kg. Furthermore, long-term medication will provide sustained effects without issues of drug resistance.
Q: From the perspectives of pharmacokinetics and pharmacodynamics, how does the product achieve relatively superior results compared to daily formulations?
A: Under physiological conditions, growth hormone has two peaks at 21-24 points and 5-7 points. After using daily formulations in the evening, the blood concentration can be maintained for 16 hours to cover these two peaks, but there is still substantial fluctuation. Clinical research widely demonstrates that, at equivalent doses, multiple administrations maintain a more stable blood concentration compared to single dosing, resulting in better efficacy. The long-acting formulation employs controlled-release technology, allowing for more even release of the drug, yielding better effects. Additionally, the active drug's molecular weight is 22 kDa, consistent with natural growth hormone, effectively acting on the growth plate. In contrast, other long-acting growth hormone products using permanent binding technologies have molecular weights greater than 40 kDa, which cannot penetrate the growth plate.
Q: Given the impact of factors such as fertility rates, how do you view the new patient market?
A: First of all, parents are paying more attention to children's growth and development, with increasing willingness and ability to pay. They focus more on efficacy and user experience, and the use of long-acting products is expected to show a growth trend. Additionally, patients with lower willingness to pay may tend to use therapies other than growth hormones. Overall, this market is not an absolutely price-sensitive market.
Q: What is the current progress of local commercialization?
A: The company has commissioned WUXI BIO for local commercialization production, which is continuously being promoted. The process of transferring biological drugs requires completing a series of processes such as process transfer and product quality verification, ultimately approved by the drug regulatory authority for local production. The company expects to complete local supply for the China market in the second half of 2028 and is advancing according to plan.
Q: What is the company's product pricing strategy?
A: One of the characteristics of the company's product Rong Pei Growth Hormone is that there are no milestone payments in the license-in agreement, but rights are obtained through its stockholdings in the company, so future sales revenue does not need to deduct sharing fees. The product is expected to be approved in the second half of 2025, and the specific pricing will only be determined upon approval. Considering the long usage cycle of the product, the market size in China, and patients' ability to pay, the pricing direction is mainly based on 1) the product's efficacy being optimal, fully considering its intrinsic value; and 2) considering the acceptance in the Chinese market: at present, the price of growth hormones is divided into three levels: short-acting water injection (annual treatment cost about 0.06-0.07 million yuan), short-acting powder injection (annual treatment cost about 0.02-0.03 million yuan), and long-acting preparations (annual treatment cost about 0.12 million yuan). The payment range for the product now will also serve as an important reference for the company.
Q: What is the preparation of the commercialization team? And what is the target demographic for the product?
A: The considerations for the company's product sales during the import stage and local phase are different. Before local commercialization in 2028, only imported products will be sold, which are more expensive. Additionally, some consumers trust imported products more, leading to higher willingness to pay. The pricing strategy during the local phase will be further adjusted, with the list price in the USA being about $70,000-$80,000, and in Germany around €25,000-€30,000 for annual treatment. The sales team of the commercialization group will complete their setup by Q3 2025, actively communicating with various parties, and will determine detailed arrangements based on the specific promotional model after approval, which will be announced further at that time.
Q: What is Anhui Anke Biotechnology's positioning in cooperation with the company?
A: Anhui Anke Biotechnology, as a cornerstone investor, has invested in Weisheng Pharmaceutical primarily due to confidence in Weisheng's core product pipeline, aiming to promote deep strategic collaboration between the two parties. In the future, the two sides will engage in comprehensive cooperation at the product level, leveraging Anhui Anke's years of sales advantages and rich resources in the growth hormone field, to advance deep strategic cooperation in their respective areas of advantage, achieve resource integration and complementary strengths, and fully leverage industrial synergy effects. Any cooperation between the company and Anhui Anke will be announced in a timely manner in the future.
Q: What impact will the recently introduced policies to promote fertility subsidies have on the company's products?
A: Policies promoting fertility are likely to expand the target population and number of new patients for the company's products by increasing the number of newborns. We believe that with the support of national policies, there will be a rebound trend in the long-term birth rate, and the number of potential patients for the company will grow, especially given that the growth hormone market has a large number of untreated patients, which represents significant market potential.
Q: Is there a possibility for the expansion of adult indications?
A: Adult indications will be considered. There are already marketed products for adult growth hormone deficiency, and the Phase III adult data from the original research company Ascendis is also very impressive. Their growth hormone and hypoparathyroidism products have been launched in Europe and the USA, and the company will actively explore new possibilities based on existing indications.
