Event 1: The clinical trial of BL-B01D1, the company's core pipeline EGFR*HER3 bispecific antibody ADC, continues to make progress in China and the United States, and we believe that its follow-up clinical development and marketing process are expected to increase, and we are optimistic about the potential of 01D1 to expand to the front line. 1) In terms of clinical trials in China, 3 new indications of 01D1 monotherapy for the posterior line of solid tumors have recently been granted Breakthrough Therapy Designation, and up to now, 4 indications of 01D1 have been included in the list (Table 1). We believe that this move reflects the strong official endorsement of 01D1 on the one hand, and on the other hand, the entry into Breakthrough Therapy Designation is expected to accelerate the clinical development of subsequent 01D1 in China. 2) In terms of global clinical trials, the Phase 1/2a clinical trial of the 01D1 combination program for the treatment of solid tumors was approved by the FDA to start around September 30, 2024. Considering that 01D1 has already started Phase II clinical trials in combination with PD-(L)1 for the first-line treatment of 9 cancers in China, and Phase II clinical trials in combination with EGFR-TKI for the first-line treatment of lung cancer (Table 2), we believe that this approval opens up the potential for the expansion of 01D1 in the frontline treatment of pan-solid tumors in the world, and it is expected to replace the chemotherapy part of the current standard therapy in first-line, adjuvant or neoadjuvant indications in the future, and become the next blockbuster product after PD-(L)1, we look forward to 01D1 Data readout at the front.

Event 2: The company's pipeline CD33 ADC BL-M11D1 was approved by the FDA to initiate Phase I clinical trials, and it is recommended to pay attention to potential opportunities in the company's other pipeline under development. On October 14, the FDA approved the Phase I clinical trial application for the company's CD33 ADCBL-M11D1 for the treatment of patients with relapsed or refractory acute myeloid leukemia. Up to now, the company has obtained clinical approval from the FDA for a total of 5 projects (Table 3), and we look forward to the overseas data readout of the above drugs and potential overseas cooperation opportunities in the future.

Earnings forecasts. We expect the company to achieve a net profit attributable to the parent company of 40.89/-1.29/-905 million yuan from 2024 to 2026, and the corresponding EPS will be 10.20/-0.32/-2.26 yuan respectively. Using the DCF valuation method, the corresponding reasonable stock price is 214.73~226.83 yuan, giving a "better than the market" rating.

Risk warning: the risk that the progress of drug research and development is less than expected, the risk that drug sales are less than expected, the risk of intensified competition, and the risk of policy;