Baiji Shenzhou (688235)
On December 15, Baiji Shenzhou was listed on the science and Innovation Board of Shanghai Stock Exchange. With the listing of Baiji Shenzhou science and innovation board, the company will become the first enterprise to be listed in US stocks, Hong Kong stocks and a shares. Baiji Shenzhou’s listing on the science and innovation board raised more than 20 billion yuan, which is mainly used for drug clinical trial R & D projects, R & D center construction projects, production base R & D and industrialization projects, marketing network construction projects and supplementary working capital. We believe that the company’s listing on the science and innovation board is expected to enhance the company’s financial strength and enhance the company’s anti risk ability and sustainable operation ability. In addition, on December 14, the company and Nanjing weilizhibo Biotechnology Co., Ltd. announced that they had reached an authorization and cooperation agreement to spend US $773 million to obtain the global R & D and production power of the latter’s antibody drug lbl-007 targeting LAG-3, so as to further enrich the company’s product pipeline.
Comments:
Adhere to the three-wheel drive strategy of “independent research and development + licensein + licenseout” to enhance the enterprise value
By building The three-wheel drive strategy of “independent research and development + licensing in + licensing out” has continuously improved the enterprise value and broadened the commercial territory. The company is a global and commercial biotechnology company focusing on the research, development, production and commercialization of innovative drugs. As of November 4, 2021, the company has 48 commercial products and clinical candidate drugs, including 10 commercial stage drugs Stage drugs, 2 declared candidate drugs and 36 candidate drugs at 6 clinical stages. Among them, the company has 3 self-developed drugs on the market, 8 self-developed candidate drugs in the clinical research stage, and 37 cooperative products in the clinical commercialization stage.
The commercialization of the three independently developed drugs is progressing smoothly and have been included in the national medical insurance catalogue. Three self-developed drugs in Baiji Shenzhou are in the stage of commercialization, namely Btk inhibitor baiyueze ® （BRUKINSA ®， Zebutinib capsule, zanubrutinib), anti-PD-1 monoclonal antibody, baizean ® (tirelizumab injection, tiselizumab) and PARP inhibitor baihuize ® (pamipali capsule, pamiparib). In the medical insurance negotiation in early December, pamipali was successfully included in the medical insurance, and the first-line treatment indications of tirelizumab for non-small cell lung cancer were successfully included in the medical insurance.
License in, authorized products usher in the harvest season. In addition to independent R & D, the company has signed cooperation agreements with Bristol Myers Squibb, Amgen, Novartis, zymeworks, Bio-Thera Solutions Ltd(688177) and other companies to establish cooperative relations on R & D, production, registration and sales activities of a series of pipelines. Among them, blincyto (CD3) introduced by Amgen × Cd19bsab) was approved conditionally by nmpa in December 2020 and officially commercialized and listed in August 2021; In July 2021, another Amgen authorized variety, caffezomib for injection, was approved for use in adult patients with relapsed refractory (R / R) multiple myeloma (mm). Qarziba (datuximab) introduced by EUSA β） And sylvant were approved to market in August and December 2021 respectively for the treatment of neuroblastoma and Castleman’s disease (MCD). In addition, the company early developed pipeline urinary tigit, Tim-3, OX40 and PI3K δ、 The development projects of novel targets such as HPK1 are progressing smoothly, injecting power into the long-term sustainable development of the company.
On December 14, Baiji Shenzhou and Nanjing weilizhibo Biotechnology Co., Ltd. announced that they had reached an authorization and cooperation agreement. Baiji Shenzhou obtained the global R & D and production power of antibody drug lbl-007 targeting LAG-3, and weilizhibo received a down payment of US $30 million, milestone fees for R & D, supervision and sales of up to US $742 million, as well as double-digit hierarchical sales royalties. We believe that LAG-3 is the third immune checkpoint expected to be commercialized after PD-1 and CTLA-4, which will overcome the insufficient remission rate of PD-1 inhibitors. Considering that the company has deployed immune checkpoints such as PD-1, tigit and Tim-3, the introduction of LAG-3 monoclonal antibody is expected to improve the puzzle of immune checkpoint inhibitors of the company. In the future, the anti-tumor efficacy of drugs will be further improved through the combination scheme to achieve the therapeutic effect of “1 + 1 > 2”.
License out, it’s the right time for the drug to go to sea. In addition to the license in, the company is expanding the overseas market through the license out to accelerate the progress of internationalization. In January 2021, the company reached a cooperation agreement with Novartis, authorizing Novartis to develop, produce and commercialize anti-PD-1 monoclonal antibody tirelizumab in many countries, including the United States, Canada, Mexico and EU Member States. Under the agreement, the company received a down payment of US $650 million and is eligible to receive up to US $1.3 billion after reaching the registration milestone.
Profit forecast
With the listing of the company on the science and innovation board, the company’s capital strength, anti risk ability and sustainable operation ability are expected to be further improved. The introduction of LAG-3 monoclonal antibody will further enrich the company’s product pipeline and inject power into the company’s long-term sustainable development. At present, the commercialization of the company’s independently developed varieties such as zebutinib and tirelizumab is progressing smoothly, the licensein cooperative products are gradually entering the harvest period, the products continue to go to sea, and there is great potential for early research and development of pipeline targets. Although the company is still at a loss, with the further enrichment of product pipelines, the company’s performance is expected to continue to improve. It is estimated that the company’s revenue from 2021 to 2023 will be USD 1421 million, USD 2557 million and USD 4092 million respectively, the net profit will be USD -2.06 million, – 1.254 billion and USD 248 million, and the EPS will be -1.69 and -1.03 and 0.2. In the future, with the continuous implementation of the company’s R & D pipeline products, it is expected that the company’s performance will be gradually improved, covered for the first time, and rated as “overweight”.
Risk statement
R & D progress is less than expected, commercialization progress is less than expected, continuous loss risk, etc
