every AI newsletter, on December 21, 2023, guangfa securities issued a research report to comment on Baili Tianheng (688506).

Key points:

over us $8 billion to join hands with BMS,B01D1 to realize overseas authorization. According to the company's announcement on December 12, the subsidiary SystImmune reached a global strategic cooperation agreement with BMS. SystImmune will be solely responsible for the development, commercialization and production of BL-B01D1 in mainland China, and for the production of some drugs for use outside mainland China. BMS will be solely responsible for the development and commercialization of the BL-B01D1 in other parts of the world. BMS will pay the SystImmune a down payment of US $0.8 billion and up to US $0.5 billion in recent contingent payments. After reaching development, registration and sales milestones, the SystImmune will receive up to US $7.1 billion in additional payments. Potential total transaction amount is up to US $8.4 billion.

B01D1 Registration Phase III progressed smoothly, and early data appeared in international academic conferences many times. B01D1 is the world's first EGFR/HER3 ADC, the domestic clinical has entered Phase III, intended to be used for the treatment of nasopharyngeal cancer, and has completed a number of Phase III or key registration Phase II clinical study applications. In terms of overseas clinical development, a global multi-center Phase I clinical study (BL-B01D1-LUNG101) has been carried out for the treatment of NSCLC. Early clinical study data for B01D1 were presented at the ASCO, ESMO, and SABCS conferences in 2023. Data show that BLB01D1 shows promising anti-tumor activity in a variety of solid tumors such as non-small cell lung cancer, nasopharyngeal cancer, and breast cancer that have progressed after standard treatment.

The value of the platform is highlighted, and the innovation results continue to land. The company has established an integrated ADC platform, a total of 4 ADC into the I/II phase. The global progress of multiple drugs hatched by the dual/multi-anti-platform is leading: SI-B001(EGFRXHER3) treatment of NSCLC is in Phase III, and the clinical combination of SI-B003(PD-1XCTLA-4) and SI-001 and chemotherapy is in Phase II; GNC-038, GNC-035, and GNC-039 are all in Phase I.

Earnings forecasts and investment recommendations. The Company's revenue for 2023-2025 is expected to be $5.31, $73.56 and $0.95 billion, respectively, mainly from sales of stock business and confirmation of BD-related down payments and milestones. B01D1's early data is bright, and cooperation with BMS will accelerate its globalization process. Using the DCF valuation method, the reasonable value of the company is 167.13 yuan/share, maintaining the "buy" rating.

Risk. Risk of research and development failure, product sales are less than expected, market competition exceeds expectations, etc.

(Source: Huibo Investment Research)

Disclaimer: The content and data in this article are for reference only and do not constitute investment advice. Please verify before use. Operate accordingly at your own risk.

(edited by Zeng Jianhui)