\u3000\u3000 Suzhou Zelgen Biopharmaceuticals Co.Ltd(688266) (688266)
Core view
Event: Suzhou Zelgen Biopharmaceuticals Co.Ltd(688266) and its subsidiary gensun’s application for clinical trial of zg005 powder injection under development was approved by the U.S. Food and Drug Administration (FDA) for the treatment of patients with solid tumors.
Zg005 is an anti-PD-1 / tigit bispecific antibody powder, which is expected to be used in the treatment of a variety of solid tumors. Zg005 powder injection is an innovative biological product of tumor immunotherapy, which is expected to be used to treat a variety of solid tumors. According to public inquiries, zg005 is one of the first drugs with the same target to enter clinical research in the world. At present, there are no drugs with similar mechanisms approved for marketing all over the world.
Zg005 has the function of double targeting blocking PD-1 and tigit, which can not only effectively block the signal pathway of PD-1 and its ligand PD-L1, but also promote the activation and proliferation of T cells; It can also effectively block the signal pathway of tigit and its ligand PVR, promote PVR to combine with CD226 to produce costimulatory activation signal, so as to promote the activation and proliferation of T cells and NK cells, and produce the synergy after the two targets are blocked at the same time, so as to enhance the ability of the immune system to kill tumor cells. The results of preclinical study showed that zg005 had significant and long-term antitumor effect, and the curative effect was better than that of single drug (anti-PD-1 antibody or anti tigit antibody) and combined administration; Zg005 showed excellent pharmacokinetic characteristics and good safety in non-human primates.
The company has large comprehensive value of pipelines and rich product echelons. The company is an innovation driven chemical and biological new drug R & D and production enterprise focusing on multiple treatment fields such as tumor, bleeding and blood diseases, hepatobiliary diseases and immune inflammatory diseases, focusing on the layout of major diseases and rare diseases at the same time. At present, the company is developing 42 R & D projects of 16 new drugs, and the product line of its subsidiary gensun includes more than 10 candidate antibody new drugs.
Investment suggestion: Based on the company’s sustainable development space and good R & D capacity, we expect the company to achieve a revenue of 200 / 550 / 800 million yuan and a net profit attributable to the parent company of -4.77 / – 2.22 million yuan from 2021 to 2023/- RMB 63 million, corresponding to EPS of -1.99 / – 0.93 / – 0.26. With the listing of donafenib, the company will usher in the harvest period of innovative drugs and maintain the “overweight” investment rating.
Risk warning: the sales of new products are less than expected; R & D risk; The progress of clinical and review is less than expected; Risk of technology transfer between China and the United States; The risk of intensified industry competition; Macroeconomic downside risk
