The 2024 annual report released by Junshi Biosciences (SH688180) on the evening of the 27th shows that the company's net loss continues to narrow year-on-year. Since 2023, Junshi Biosciences has achieved a year-on-year increase in operating income and a continuous narrowing of net loss for two consecutive years, and the year-on-year loss reduction in 2024 will expand significantly.

The improvement in Junshi Biosciences' performance was mainly due to the core product toripalimab. Last year, toripalimab achieved sales revenue of 1.501 billion yuan in China last year, a year-on-year increase of 66%, accounting for about 77% of the company's overall revenue. The company said at the performance briefing that the approval of a number of new indications, the increase in medical insurance indications, and the continuous improvement of sales efficiency have all driven the performance of toripalimab.

On the other hand, the early changes in Junshi Biosciences' sales team and senior management candidates were frequent, which made the stability and sales efficiency of the company's sales team once attracted attention from the outside world. In this regard, Junshi Biosciences responded at the performance meeting that the company's per capita sales efficiency has been significantly improved. The company's sales expense ratio has already decreased year-on-year in 2024, and it will further reduce the sales expense ratio this year and 2026.

Junshi Biosciences continued to reduce losses

In 2024, Junshi Biosciences will achieve operating income of 1.948 billion yuan, an increase of 29.67% year-on-year, and the net profit attributable to the parent company will be a loss of 1.281 billion yuan, a year-on-year decrease of 43.89%. This is the second consecutive year since 2023 that Junshi Biosciences has achieved a year-on-year increase in operating income and a continuous narrowing of net loss.

At the performance briefing, Junshi Biosciences said that the revenue growth in 2024 will be due to the approval of a number of new indications for the core product toripalimab, the increase in medical insurance indications, and the continuous improvement of sales efficiency.

Among the four "PD-1 (programmed death receptor) tigers" companies, Junshi Biosciences, Hengrui Pharmaceutical, BeiGene and Innovent Biologics, Junshi Biosciences was once criticized for "falling behind". However, Junshi Biosciences is now regaining the initiative through the differentiated layout of toripalimab.

Last year, toripalimab was approved for the new indications of advanced triple-negative breast cancer, advanced renal cell carcinoma and extensive-stage small cell lung cancer. Together with the first-line treatment of advanced liver cancer approved in March this year, toripalimab has been approved for 11 indications in Chinese mainland so far.

However, judging from the performance in 2024, there is still a certain gap between toripalimab and the sales of BeiGene's tislelizumab and Innovent Biologics' sintilimab (Hengrui Pharma has not yet announced its 2024 financial report).

In addition to the indications for liver cancer, the first 10 indications of toripalimab have been included in the national medical insurance catalog, and it is the only anti-PD-1 monoclonal antibody used in the national medical insurance catalog for the treatment of melanoma, non-small cell lung cancer (the perioperative period is a whole process around surgery), kidney cancer and triple-negative breast cancer.

At the performance briefing, Junshi Biosciences further analyzed the proportion of revenue corresponding to each indication: "The sales performance of toripalimab for each indication has been significantly improved compared with before. Since toripalimab is the only perioperative (perioperative period is the full cycle around surgery) PD-1 of lung cancer covered by medical insurance, the current lung cancer indication contributes 25% of the revenue. In the first two months of this year, toripalimab has become the first in the perioperative period of lung cancer and small cell lung cancer. ”

The company said that in the future, toripalimab should have a significant sales growth in liver cancer, cholangiocarcinoma, malignant melanoma, pancreatic cancer and other indications. At the same time, some indications that are already covered by medical insurance, especially exclusive indications, are expected to further improve performance.

It is expected that the selling expense ratio will decline further this year and next

In addition to the intensive implementation of large indications, Junshi Biosciences believes that the sales increase of toripalimab is also due to the performance of the international market and the improvement of sales efficiency.

In terms of internationalization, after obtaining approval from the U.S. Food and Drug Administration, toripalimab was officially launched into the U.S. market in January 2024 and has been approved in more than 30 countries and regions.

Junshi Biosciences said that it is expected that toripalimab's overseas revenue will usher in a period of rapid growth.

On the other hand, Junshi Biosciences' sales team and senior management candidates changed frequently in the early stage, resulting in the stability and sales efficiency of the company's sales team once attracted attention from the outside world. In this regard, Junshi Biosciences responded at the performance meeting that the company's per capita sales efficiency has been significantly improved, and a high-standard compliance system has been built. The company's 2024 selling expense ratio has already decreased year-over-year, and it will further reduce the selling expense ratio this year and in 2026.

In the research pipeline, the R&D progress of the "Tifcemalimab" project has also attracted attention. The product is the world's first anti-tumor anti-BTLA (B and T lymphocyte attenuation factor) monoclonal antibody in clinical development, and two Phase III registrational clinical studies are underway. In terms of the estimated total investment scale and cumulative investment amount, the Tifcemalimab project ranks second among all major R&D projects of Junshi Biosciences, second only to toripalimab.

The company expects interim data to be read out from 2026 to the first half of 2027, and if it goes well, it will submit a global marketing application for Tifcemalimab from the end of 2026 to the first half of 2027. "We will also be open to cooperating with MNCs (multinational pharmaceutical companies) or other companies during the global development and subsequent commercialization of Tifcemalimab." The company added.