Huachuang Securities released a research report stating that it maintains a "recommended" rating for Hansoh Pharma (03692), adjusting profit forecasts based on the situation of various indications of products and expectations of listing. It is expected that the company's revenue in 2024-2026 will be 12.155, 12.439, and 14.47 billion yuan respectively; net income attributable to shareholders will be 4.259, 3.945, and 4.669 billion yuan, with a target price of 25.44 Hong Kong dollars. The company has basically achieved the transformation into an innovative-driven enterprise, with a new high in the proportion of revenue from innovative drugs. The R&D pipeline includes a variety of leading domestic varieties, and the international potential of ADC is emerging.

Events: The company achieved total revenue of 6.506 billion yuan (+44.2%), net income of 2.726 billion yuan (+111.5%), and EPS of 0.46 yuan (+111.4%). Sales revenue from innovative drugs and collaborative products amounted to 5.032 billion yuan (+80.6%), increasing the proportion of total revenue from 61.8% in 23H1 to 77.4%.

Huachuang Securities' main views are as follows:

Revenue from innovative drugs saw a significant year-on-year increase, with efforts across multiple treatment areas.

In the first half of the year, sales revenue from innovative drugs and collaborative products reached 5.032 billion yuan (+80.6%), increasing the proportion of total revenue from 61.8% in 23H1 to 77.4%, achieving a new high. In the first half of 2024, the oncology field achieved revenue of 4.475 billion yuan (+75.15%), accounting for 68.8% of total revenue (+12.2pp); the central nervous system field achieved revenue of 0.733 billion yuan (+4.57%), accounting for 11.3% of total revenue (-4.2pp); the anti-infection field achieved revenue of 0.701 billion yuan (+16.64%), accounting for 10.8% of total revenue (-2.5pp); the metabolism and other fields achieved revenue of 0.597 billion yuan (-8.72%), accounting for 9.1% of total revenue (-5.5pp).

Research and development progress smoothly, with several key domestic varieties leading in progress in the pipeline.

Selinisib approved for the third-line treatment of DLBCL, and the NMPA has accepted the NDA for the third and fourth indications of Amivantamab, used for EGFRmt.

Selinisib approved for the third-line treatment of DLBCL, and the NMPA has accepted the NDA for the third and fourth indications of Amivantamab, used for postoperative adjuvant therapy in EGFRmt NSCLC and unresectable locally advanced EGFRmt with no progression after platinum-based radical chemoradiotherapy.

NSCLC. HS-20094 (GLP-1R/GIPR) has published Phase IIa data for diabetes, with good safety and tolerability. Inolimomab (CD19) IgG4-RD.

Phase III studies have reached the primary endpoint, with global clinical trials for gMG including China currently ongoing.

The pipeline ADC products have the potential for internationalization.

HS-20093 (B7H3ADC) has obtained FDA breakthrough therapy designation, and this ADC is being evaluated for the treatment of ES-SCLC patients progressing during or after platinum-based chemotherapy; in addition, GSK has completed overseas Phase I clinical registration for both HS-20093 and HS-20089 (B7H4ADC) ADCs. A new solid tumor ADC.

HS-20124 has been approved for clinical trials. Furthermore, the company has expanded its collaboration with Pumis on the EGFR/c-Met bispecific HS-20017 antibody, granting Hansoh exclusive licensing rights to use HS-20117 globally for the development, production, and commercialization of bispecific ADCs, with the option for further sublicensing.

Risk warning: Clinical progress may not meet expectations, commercial performance may not meet expectations, and the competitive landscape may change.