BOCOM INTL released a research report stating that it maintains a "Buy" rating for Hutchmed (China) (00013), believing that the trading conditions are reasonable and beneficial for the company's long-term development. The profit forecast has been adjusted, and the DCF Target Price has been raised to 44 Hong Kong dollars. The company continues to make key progress in mid to late-stage pipeline development, with relevant catalysts expected in 2025, including: 1) Based on the success of the SAVANNAH study, partner AstraZeneca will soon submit the first overseas NDA for savolitinib to the FDA (2/3 LMET aberrant, treatment-resistant NSCLC); 2) The Chinese phase III SACHI study (2 LMET amplification EGFRTKI treatment-resistant NSCLC) has reached its primary endpoint, and the Chinese sNDA application has been accepted and granted priority review; 3) Following the supplemental application for sugemalimab, the company is actively communicating with the CDE and rolling out supplementary materials, with approval expected within the year.

Bocom International's main points are as follows:

Selling a non-core joint venture for 0.608 billion USD will further focus on Innovative Drugs research and development.

On January 1, 2025, Hutchmed announced it would sell its 45% stake in Shanghai Hutchmed to Shanghai Jinguopor Jinfu Equity Investment Management Co., Ltd and Shanghai Pharma for $0.608 billion (approximately 14 times the 2023 PE). Prior to the transaction, Hutchmed and Shanghai Pharma each held a 50% stake in Shanghai Hutchmed. According to the agreement terms, Jinguopor Jinfu and Shanghai Pharma will acquire a 35% and a 10% stake in Shanghai Hutchmed for $0.473 billion and $135 million in cash, respectively, while Hutchmed will retain a 5% stake after the transaction closes. Hutchmed expects the transaction to provide $0.477 billion in pre-tax profits, most of which will be reflected in the 2025 performance. Additionally, the company guarantees to Jinguopor Jinfu that the net income of Shanghai Hutchmed will grow by at least 5% annually over the next three years; if achieved, more profits will also be gained in 2026-27; if not achieved, the total compensation will not exceed $9.5 million.

The differentiated advantage of the self-developed ATTC platform is significant and is about to enter the clinical validation stage:

The company plans to use the proceeds from the above transaction to further develop its internal product pipeline and promote the development of its core Business Strategy, focusing on: 1) Next-generation antibody-drug conjugates (ADCs) platform, leveraging the synergistic effect of antibody-small molecule inhibitors to precisely target proteins essential for cancer growth, effectively overcoming chemotherapy resistance. At the same time, the drug load based on targeted therapy is expected to reduce various toxicities associated with cytotoxic agents, and is anticipated to become a frontline standard treatment in combination with immunotherapy/chemotherapy. Preclinical data shows strong anti-tumor activity and lasting remission, exhibiting stronger anti-tumor activity compared to monoclonal antibodies and targeted drugs alone; the first candidate drug from this platform is expected to enter clinical trials in the second half of 2025. 2) Subsequent innovative drugs will be developed simultaneously overseas and in China, along with a strategic layout for Global BD.