证券研究报告 | 公司动态点评 2024 年 09 月 04 日 云顶新耀-B（01952.HK） 商业化成绩亮眼，耐赋康收入超预期 | --- | --- | --- | --- | --- | --- | --- | --- | |--------------------------------------------|---------|-------------------------------------|---------|----------|----------|-------------------------------------------|----------| | 财务指标 | 2022A | 2023A | 2024E | 2025E | 2026E | 买入（维持评级） | | | 营业收入（百万元） | 12.79 | 125.93 | 702.70 | 1,749.72 | 2,817.06 | 股票信息 | | | 增长率 yoy （ % ） | | 23588.89 884.46 458.00 149.00 61.00 | | | | | | | 归母净利润（百万元） ...

Investment Rating - The report assigns a "Buy" rating to the company with a target price of HKD 44.00, indicating a potential upside of 110.0% from the current price of HKD 20.95 [6]. Core Insights - The company has exceeded sales expectations in 1H24, particularly for its products Yijia and Naifukang, leading to an upward revision of revenue forecasts for 2024-25 and an increase in the target price [1]. - The upcoming 18 months are expected to be rich in catalysts, including the commercialization of new drugs and ongoing clinical studies [1][2]. - The company has demonstrated an efficient commercialization model for Naifukang, achieving significant market penetration with a limited sales force [1]. Financial Performance Summary - 1H24 product sales surged by 158% to RMB 302 million, surpassing market expectations [1]. - Naifukang generated sales of RMB 167 million within a month and a half of its launch in mainland China, with further approvals anticipated [1]. - Yijia sales reached RMB 134 million, driven by positive real-world study results and deeper market coverage [1]. - Adjusted non-IFRS net loss narrowed to RMB 213 million in 1H24 from RMB 327 million in 1H23, with a gross margin of 83% [1]. - The company expects product sales revenue of RMB 700 million in 2024 and aims for cash flow breakeven in 2025 [1]. Revenue Forecast Changes - Revenue forecasts for 2024E and 2025E have been adjusted to RMB 744 million (up 5.5%) and RMB 1,504 million (up 0.8%), respectively [3]. - Gross profit estimates for 2024E and 2025E have been revised to RMB 573 million (up 8.3%) and RMB 1,173 million (up 2.1%) [3]. - The gross margin is projected to improve to 77.0% in 2024E and 78.0% in 2025E [3]. Key Upcoming Events - Important upcoming events include the results of the medical insurance negotiations for Naifukang, the submission of NDA for Yikumo in mainland China, and the anticipated launch of additional innovative drugs [2]. - Clinical data readouts for various ongoing studies are expected to provide further insights into the company's product pipeline [2].

Company Performance - In the first half of 2024, Everest Medicines achieved significant milestones, including the successful commercialization of the only approved treatment for IgA nephropathy in China, Nanfukang®[7]. - The company reported a strong performance despite the biotechnology sector facing challenges, outperforming the Hang Seng Hong Kong-listed biotech index, which fell nearly 30% in the same period[7]. - Revenue growth is driven by deepening hospital penetration and expanding clinical applications of its product Yijia® in more hospitals[7]. - The company remains committed to efficiently executing its strategy to deliver innovative therapies to more patients globally[7]. - Everest Medicines is confident in its development as a leading biopharmaceutical company in the Asia-Pacific region, supported by increasing policy backing and its robust performance[7]. Product Development and Approvals - NEFECON® is the first drug globally for the treatment of IgA nephropathy, showing a 50% reduction in kidney function decline and a 66% delay in kidney function deterioration in the Chinese population, extending the time to dialysis or kidney transplant by 12.8 years[8]. - NEFECON® received approval from the Chinese National Medical Products Administration in November 2023 and is expected to be commercially launched in mainland China in May 2024[8]. - The company plans to announce topline results from the open-label study of NEFECON® in China in the second half of 2024[11]. - Zetomipzomib, a novel selective immunoproteasome inhibitor, has shown good safety and tolerability in treating severe chronic autoimmune diseases, with clinical trials approved in China for lupus nephritis[11]. - The company plans to submit a new drug application for cefepime-tazobactam for complicated urinary tract infections in mainland China by 2025[16]. Financial Performance - Revenue increased from RMB 89 million for the six months ended June 30, 2023, to RMB 301.5 million for the six months ending June 30, 2024, primarily due to the expansion of sales in mainland China and Hong Kong[22]. - Gross margin improved from 62.7% for the six months ended June 30, 2023, to 76.6% for the six months ending June 30, 2024, driven by the launch of new products[22]. - Net loss increased from RMB 423.6 million for the six months ended June 30, 2023, to RMB 632.4 million for the six months ending June 30, 2024, primarily due to a one-time impairment loss related to mRNA COVID-19 vaccine intangible assets[22]. - The company aims to achieve revenue guidance of RMB 700 million for the current year, reflecting confidence in meeting the clinical needs of patients in Asia[24]. - The company reported a net loss of RMB 632,413 thousand for the six months ended June 30, 2024, compared to a loss of RMB 423,612 thousand for the same period in 2023[111]. Research and Development - The company is developing multiple mRNA therapeutic drugs and has established an end-to-end capability for mRNA drug development and manufacturing[33]. - The company has terminated its collaboration with Providence Therapeutics to focus on developing proprietary mRNA therapeutic vaccines, shifting its strategy towards owning all intellectual property and global rights[19]. - The company plans to submit a new drug application for Etrasimod in China in 2024, following the announcement of positive top-line results from a Phase 3 clinical trial in July[28]. - The company expects to announce the topline results of the Phase 1b clinical study for EVER001 in membranous nephropathy in the second half of 2024[13]. - The company has initiated a partnership to develop an integrated ecosystem for kidney disease diagnosis and treatment, aiming to launch a commercially valuable IgA nephropathy testing kit[29]. Market Strategy and Collaborations - The company is actively seeking external collaborations in key therapeutic areas such as renal, infectious, and autoimmune diseases to maximize synergies across its clinical and commercialization platforms[7]. - The commercialization team has expanded to support the launch of new products and growth in existing product sales, with selling expenses increasing from RMB 64.1 million to RMB 200.4 million[22]. - The sales team for NEFECON® has been established with over 100 representatives, targeting 400 to 600 core hospitals, covering more than 60% of the IgA nephropathy patient population in China[29]. - The company is collaborating with contract sales organizations to expand access to Etrasimod beyond its internal commercialization team, targeting additional patients[29]. - The company has published several articles in medical journals regarding Etrasimod's efficacy and safety in treating various infections, enhancing its clinical profile[30]. Governance and Compliance - The audit committee consists of three independent non-executive directors, ensuring compliance with corporate governance standards[67]. - The company has implemented training for directors regarding compliance with the standard code of conduct to prevent future violations[66]. - The company has established a special resolution to amend its articles of association to comply with updated listing rules[69]. - The company maintains a strong governance structure with significant shareholding by key stakeholders, ensuring alignment of interests[81]. - The company plans to continue compliance with the new Chapter 17 of the listing rules effective from January 1, 2023[84]. Shareholder Information - As of June 30, 2024, Mr. Bo Wei holds 129,265,877 shares, representing 39.75% of the company's equity[76]. - Major shareholders include Vistra Trust (Singapore) Pte. Limited and Nova Aqua Limited, both holding 129,265,877 shares (39.75%)[80]. - C-Bridge Healthcare Fund II, L.P. and its affiliates collectively hold 52,777,778 shares, accounting for 16.23% of the equity[80]. - The total number of shares issued as of June 30, 2024, is 325,164,793[78]. - The company has not disclosed any additional interests or short positions held by directors or senior management as of June 30, 2024[78].

Investment Rating - Buy (首次评级) [1] Core Views - The company's flagship product, Nefecon, has successfully commercialized, marking a significant milestone in the treatment of IgA nephropathy [1][2] - Revenue is expected to grow steadily as products like Eravacycline and Nefecon continue to contribute to sales, with potential for further expansion in 2024 [1][2] - The company is actively preparing for医保谈判, which could significantly boost Nefecon's revenue if successful [2] - The mRNA platform, focusing on tumor therapeutic vaccines, is expected to become a cornerstone for sustainable growth in the medium to long term [4] Financial Performance - Revenue for 2023 was RMB 125.93 million, a significant increase from RMB 12.79 million in 2022, driven by the commercialization of Eravacycline and Nefecon [1] - Net loss for 2023 widened to RMB 844.46 million, compared to RMB 247.28 million in 2022, primarily due to increased expenses and the absence of a one-time gain from the Trodelvy® transaction [1] - Revenue is projected to grow to RMB 702.70 million in 2024, RMB 1,749.72 million in 2025, and RMB 2,817.06 million in 2026 [1] Product Pipeline - **Nephrology**: Nefecon, the first innovative drug for IgA nephropathy, has shown significant clinical benefits in reducing proteinuria and slowing eGFR decline [2][38] - **Infectious Diseases**: Eravacycline, a broad-spectrum antibiotic, has been successfully commercialized, while Cefepime-Taniborbactam is expected to launch by 2025-2026 [2][53] - **Autoimmune Diseases**: Etrasimod, approved in Macau, is expected to contribute to revenue starting in 2024-2025 [2] - **mRNA Platform**: The company is focusing on developing tumor therapeutic vaccines, with clinical trials expected to begin in the second half of 2024 [4] Market Potential - The global market for chronic kidney disease (CKD) is substantial, with an estimated 700 million patients worldwide, and China accounts for approximately 18% of this population [28][30] - IgA nephropathy, the most common primary glomerular disease, has a higher prevalence in Asian populations, particularly in China, where it accounts for about 53% of primary glomerular diseases [31][32] - The market for multi-drug resistant Gram-negative bacteria (MDR-GNB) antibiotics is expected to grow, with projections indicating a market size of RMB 19.3 billion by 2027 [59] Strategic Developments - The company has built a robust commercialization team to accelerate the market penetration of its products in Greater China and other Asia-Pacific markets [1][19] - The company is leveraging the "Greater Bay Area Drug and Device Access" policy to expand the reach of its products, such as Etrasimod, in the region [2] - The mRNA platform is being developed with full industrial chain capabilities, positioning the company for long-term growth in the oncology space [4]

Financial Performance - Everest Medicines reported revenue of RMB 125.9 million from its first product, Yiga®, within five months of launch, significantly exceeding the initial forecast of RMB 70 million to RMB 100 million[5]. - Revenue increased by RMB 113.1 million or 884% to RMB 125.9 million for the year ended December 31, 2023, primarily due to the commercialization of products in mainland China and Hong Kong[9]. - The company achieved revenue of RMB 125.9 million in 2023, significantly exceeding the previous guidance of RMB 70 million to RMB 100 million[34]. - The combined revenue from Iqmod and Iqia is projected to reach RMB 700 million in 2024[36]. - The company anticipates revenue exceeding the initial guidance of RMB 700 million to RMB 1 billion during its commercialization year in 2023[29]. Product Development and Commercialization - The company received NDA approval for its primary IgA nephropathy treatment, Nanfukang®, in Macau and mainland China, with plans for commercialization in mainland China in the first half of 2024[5]. - Everest Medicines plans to launch Nanfukang® in Singapore and Hong Kong in 2024, following its commercialization in Macau[5]. - The company plans to commercialize the nephrology product, Naimu, in mainland China in 2024, supported by a new sales team of approximately 120 employees[8]. - TARPEYO® received approval from the National Medical Products Administration in China for the treatment of primary IgA nephropathy in November 2023, with plans for market launch in 2024[13]. - The company plans to submit a new drug application for the combination of cefepime and tanibartin for treating complex urinary tract infections in 2024[22]. Clinical Trials and Research - The company is advancing the global Phase 2b PALIZADE clinical study for zetomipzomib in collaboration with Kezar Life Sciences, targeting autoimmune diseases[6]. - The mRNA platform is expected to advance therapeutic vaccine development into clinical trials in 2024, enhancing the company's R&D product portfolio[12]. - In a Phase 3 clinical trial (NeflgArd), TARPEYO® demonstrated a statistically significant improvement in estimated glomerular filtration rate (eGFR) compared to placebo, with an average increase of 5.05 mL/min/1.73 m² over two years (P<0.0001)[13]. - The company completed patient recruitment for the open-label extension study of TARPEYO® in August 2023, aimed at assessing long-term efficacy and safety in Chinese patients[15]. - The company plans to advance the global, placebo-controlled Phase 2b clinical trial PALIZADE for Zetomipzomib in patients with active lupus nephritis[26]. Financial Position and Expenses - Cash and cash equivalents as of December 31, 2023, amounted to RMB 2,349.7 million[10]. - R&D expenses decreased by RMB 269.6 million to RMB 540.1 million for the year ended December 31, 2023, due to several candidate drugs completing clinical trials and entering registration or commercialization stages[9]. - The company reported a loss of RMB 844.5 million for the year ended December 31, 2023, compared to a loss of RMB 247.3 million for the previous year, marking a significant increase in losses[39]. - The net cash used in operating activities for the year ended December 31, 2023, was RMB 769.2 million, compared to RMB 1,155.8 million for the year ended December 31, 2022[60]. - The current ratio improved from 3.92 in 2022 to 8.36 in 2023, indicating a stronger liquidity position[61]. Strategic Partnerships and Collaborations - Everest Medicines partnered with Pfizer for the approval of Iqmod (VELSIPITY®) for treating moderate to severe ulcerative colitis, with plans to submit a new drug application in China[6]. - The company entered into a collaboration and licensing agreement with Kezar Life Sciences for the development and commercialization of Zetomipzomib (澤托佐米) in Greater China, Korea, and parts of Southeast Asia, with Kezar entitled to receive an upfront payment of $7 million and up to $125.5 million in future milestone payments[25]. - The company has terminated its collaboration with Providence in February 2023, retaining full rights to develop mRNA products independently[8]. - The company has entered into a collaboration agreement with Kezar Life Sciences to develop the drug Zetomipzomib for autoimmune diseases in Greater China and Southeast Asia[37]. - The company is collaborating with Venatorx Pharmaceuticals on the development of cefepime-tanibartin, with positive results from a global Phase 3 trial expected to be submitted in 2024[22]. Governance and Corporate Structure - The board of directors has undergone several changes, with new appointments and resignations noted for 2024[69]. - The company is committed to maintaining high ethical standards and transparency in its operations to maximize long-term shareholder returns[165]. - The board emphasizes the importance of managing overall business risks and providing high-quality products and services to customers[165]. - The company has adopted the corporate governance code as a benchmark for its governance practices, emphasizing the importance of high standards in protecting shareholder interests[166]. - The company has established appropriate insurance arrangements for directors and senior management against legal claims arising from corporate activities[181]. Employee and Shareholder Engagement - The company has a total employee count of 432 as of December 31, 2023, an increase from 365 in 2022, with 416 located in China[77]. - The total compensation for directors, including basic salary, housing allowance, and discretionary bonuses, amounted to approximately RMB 24.7 million, with discretionary bonuses totaling RMB 9.1 million for the year ending December 31, 2023[138]. - The company has made charitable donations of approximately RMB 15.8 million for the year ended December 31, 2023, compared to zero in 2022[84]. - The company emphasizes the importance of gender diversity at all levels and aims to increase female representation in senior management and the board[193]. - The company aims to align the interests of eligible participants with the group's interests through the post-IPO share incentive plan[129]. Market Expansion and Future Outlook - Everest Medicines aims to establish a sales team of 120 representatives by the end of 2024, targeting 600 core hospitals to cover at least 60% of market potential[5]. - The company aims to achieve cash breakeven by 2025, focusing on high-value therapeutic areas such as kidney diseases, anti-infection, and autoimmune diseases[8]. - The company aims to expand the market for Iqmod to approximately 5 million IgA nephropathy patients in mainland China in 2024[34]. - The company is focused on developing innovative therapies to meet unmet medical needs in Greater China and other emerging markets in the Asia-Pacific region[71]. - The company is dedicated to fostering a culture of compliance and ethical business practices across all levels of the organization[165].

Financial Performance - Everest Medicines reported a revenue of RMB 125.9 million from the launch of its first product, IGA, in China, exceeding initial expectations of RMB 70 million to RMB 100 million[7]. - Revenue increased by RMB 113.1 million or 884% to RMB 125.9 million for the year ended December 31, 2023, primarily due to the commercialization of Yijia® in mainland China and Hong Kong, and the launch of Naifukang® in Macau[11]. - The company achieved revenue of RMB 125.9 million in 2023, significantly exceeding the initial guidance of RMB 70 million to RMB 100 million[36]. - The combined revenue from Yijia® and Naifukang® is expected to reach RMB 700 million in 2024, with a goal of achieving cash flow break-even by the end of 2025[38]. - The company reported a loss of RMB 844.5 million for the year ended December 31, 2023, compared to a loss of RMB 247.3 million in 2022[41]. - The net loss attributable to equity holders increased from RMB 247.3 million in 2022 to RMB 844.5 million in 2023, a rise of about 241.5%[55]. - The company aims to achieve cash breakeven by 2025, focusing on high-value therapeutic areas such as kidney diseases, anti-infection, and autoimmune diseases[10]. Product Development and Commercialization - The company achieved a significant milestone with the approval of the New Drug Application (NDA) for its IgA nephropathy treatment, Nanfangkang, in Macau and mainland China[7]. - Everest Medicines plans to commercialize Nanfangkang in mainland China in the first half of 2024, with a sales team expected to reach 120 representatives by the end of the year[7]. - The company has established a commercialization team for its products, marking 2023 as the year of commercialization in China[7]. - The company plans to commercialize the key nephrology product Naifuliao in mainland China in 2024, with over 120 new employees to promote the product[9]. - The company is advancing the global Phase 2b PALIZADE clinical study for zetomipzomib in collaboration with Kezar Life Sciences, targeting autoimmune diseases including lupus nephritis[8]. - The company has established a strong product pipeline across nephrology, anti-infection, and autoimmune diseases, expected to drive significant revenue growth[32]. - The company plans to submit new drug applications for Cefepime-taniborbactam and Etrasimod in China in 2024[35]. Research and Development - R&D expenses decreased by RMB 269.6 million to RMB 540.1 million for the year ended December 31, 2023, mainly due to several candidate drugs completing clinical trials and entering registration or commercialization stages[11]. - The company has established a new R&D team focused on mRNA platform development, with plans to enter clinical trials for self-developed projects in 2024[9]. - The company is leveraging its clinically validated mRNA platform to advance therapeutic vaccines for cancer, with plans to enter clinical trials in 2024[14]. - The company successfully completed the technical transfer of its mRNA platform and expects its first self-developed tumor therapeutic vaccine to enter clinical trials in 2024[40]. Regulatory Approvals and Clinical Trials - Everest Medicines is also seeking regulatory approval for Nanfangkang in South Korea and Taiwan[7]. - The company has received FDA approval for Velsipity® for the treatment of moderate to severe active ulcerative colitis in adults, with plans to submit a new drug application in Macau and China[8]. - TARPEYO® received approval in November 2023 for the treatment of primary IgA nephropathy in China, with plans for market launch in 2024[15]. - The company initiated a clinical application of TARPEYO® in April 2023, allowing approximately 700 patients to benefit from innovative therapies for IgA nephropathy[16]. - The company completed patient recruitment for the open-label extension study of TARPEYO® in August 2023, aimed at evaluating its efficacy and safety in Chinese patients after completing phase 3 clinical trials[16]. Market Strategy and Expansion - The company aims to cover 600 core hospitals, targeting at least 60% of the market potential for Nanfangkang[7]. - A commercial team of over 100 sales personnel has been established in mainland China, successfully covering over 300 top-tier hospitals for IGA® promotion, with plans to form an additional sales team of approximately 120 people for TARPEYO® in 600 core hospitals[14]. - The company is preparing to launch Etrasimod to approximately 5 million IgA nephropathy patients in mainland China in 2024[36]. - By March 2024, Nefecon is expected to be commercialized in mainland China, Hong Kong, and Singapore, further increasing patient accessibility in Asia[21]. Corporate Governance and Management - The board consists of three executive directors, two non-executive directors, and three independent non-executive directors[157]. - The company has established a robust corporate governance framework to guide management in achieving its operational goals[168]. - The company has adopted the corporate governance code as a benchmark for its governance practices, emphasizing the importance of high standards in protecting shareholder interests and enhancing company value[170]. - The company has established mechanisms to ensure independent viewpoints are communicated effectively within the board[181]. Financial Position and Cash Flow - As of December 31, 2023, cash and cash equivalents amounted to RMB 2,349.7 million[12]. - The current ratio as of December 31, 2023, was 8.36, an increase from 3.92 in the previous year[63]. - Cash and cash equivalents increased from RMB 1,651.4 million in 2022 to RMB 2,349.7 million in 2023, an increase of approximately 42.3%[61]. - The net cash used in operating activities was RMB 769.2 million, compared to a net loss of RMB 844.5 million during the same period[62]. Employee and Shareholder Information - The total number of employees in the company was 432, an increase from 365 in 2022[80]. - The total compensation cost for the company for the year ended December 31, 2023, was RMB 474.9 million, down from RMB 853.1 million for the year ended December 31, 2022[82]. - The company has a significant number of shares held by controlled corporations, indicating a concentrated ownership structure[101]. - The company aims to recruit and retain key employees through its pre-IPO management stock option plan[105]. Social Responsibility and Community Engagement - The company made charitable donations of approximately RMB 15.8 million for the year ended December 31, 2023, compared to zero in 2022[87]. - The company emphasizes the importance of gender diversity at all levels and aims to maintain a balanced board composition[196].

Stock Performance - In the first half of 2023, Everest Medicines' stock price increased by 37%, outperforming the Hang Seng Hong Kong-listed biotech index and the Hang Seng Index, which fell by 23.41% and 4.3% respectively[10]. Product Launches and Approvals - The company launched its first product, Eiger, in July 2023 for the treatment of complex intra-abdominal infections in adult patients[10]. - Everest Medicines has three additional candidate drugs expected to receive NDA approval or submission in 2023 and 2024, including Nefecon for IgAN, with anticipated NDA approval later this year in China and Singapore[10]. - The company plans to submit NDA applications for a novel antibiotic and a treatment for ulcerative colitis in the near term[10]. - The Singapore Health Sciences Authority accepted the NDA for Nefegrastim for treating adult patients with lgAN at risk of disease progression, with approval expected in 2023[12]. - The company expects to receive NDA approvals for Nefegrastim in mainland China and Singapore in 2023, and plans to submit NDAs in South Korea, Hong Kong, Macau, and Taiwan[14]. - The company announced the successful launch of Icaris in China, marking its first commercial product in the region[15]. - The FDA accepted the NDA for a potential treatment for complex urinary tract infections, with a target action date of February 22, 2024[16]. - Etrasimod is under evaluation for moderate to severe active UC, with a decision from the FDA expected in the second half of 2023[18]. Financial Performance - Revenue increased from RMB 1.0 million for the six months ended June 30, 2022, to RMB 8.9 million for the six months ended June 30, 2023, primarily due to sales of IGA® in Singapore and Trodelvy® during the transition period with Gilead Sciences[20]. - Net loss decreased from RMB 668.0 million for the six months ended June 30, 2022, to RMB 423.6 million for the six months ended June 30, 2023, mainly due to multiple candidate drugs completing clinical trials and organizational restructuring[20]. - Adjusted net loss decreased from RMB 523.7 million for the six months ended June 30, 2022, to RMB 326.9 million for the six months ended June 30, 2023, primarily due to the reduction in IFRS losses[21]. - The company recorded a loss of RMB 423.6 million for the six months ended June 30, 2023, compared to a loss of RMB 668.0 million for the same period in 2022[29]. - The company reported a total of 73,079,000 shares issued during its global offering, including those from the exercise of the over-allotment option[64]. - The company reported a comprehensive loss for the six months ended June 30, 2023, with financial data presented in thousands of RMB[98]. Research and Development - The company is focused on expanding its product portfolio through acquisitions and in-house development of innovative therapies[10]. - The company is transitioning from a clinical-stage biotech firm to a commercial-stage biopharmaceutical company, enhancing its capabilities in drug discovery, clinical development, manufacturing, and commercialization[10]. - The company has established a strong product pipeline, including potential first-in-class or best-in-class therapeutics and mRNA vaccines, covering short-term, medium-term, and long-term opportunities[23]. - The company is focused on expanding its product pipeline through self-research teams and clinically validated mRNA platforms for infectious diseases and oncology projects[22]. Cost Management - R&D expenses decreased from RMB 345.5 million for the six months ended June 30, 2022, to RMB 288.5 million for the six months ended June 30, 2023, mainly due to multiple candidate drugs completing clinical trials and entering registration or commercialization stages[20]. - General and administrative expenses reduced from RMB 118.9 million for the six months ended June 30, 2022, to RMB 83.1 million for the six months ended June 30, 2023, attributed to organizational restructuring and a decrease in share-based compensation expenses[20]. - Selling and distribution expenses fell from RMB 148.2 million for the six months ended June 30, 2022, to RMB 64.1 million for the six months ended June 30, 2023, primarily due to the transfer of Trodelvy® commercialization activities to Gilead and organizational optimization[20]. Cash and Liquidity - Cash and cash equivalents, along with time deposits, amounted to RMB 2,540.2 million as of June 30, 2023[20]. - Cash and cash equivalents increased from RMB 1,651.4 million as of December 31, 2022, to RMB 2,540.2 million as of June 30, 2023, an increase of about 53.8%[45]. - The company's current assets totaled RMB 2,651.8 million as of June 30, 2023, including cash and cash equivalents of RMB 2,540.2 million[45]. Employee and Organizational Changes - The company established a commercial team of 138 members focused on key treatment areas, including anti-infection and nephrology, as of June 30, 2023[24]. - Employee benefits expenses decreased from RMB 182.145 million in 2022 to RMB 111.719 million in 2023, a reduction of approximately 38.7%[31]. - The company employed a total of 395 employees as of June 30, 2023, down from 476 employees a year earlier[56]. Partnerships and Collaborations - The company is actively seeking commercial partnerships in the fields of kidney disease and autoimmune diseases to expand its pipeline and ecosystem[26]. - The company has formed partnerships with leading pharmaceutical supply chain service providers in China to accelerate the commercialization of Yijia®[24]. Licensing and Acquisitions - The company recognized an impairment loss of $7.5 million (equivalent to RMB 52.0 million) related to the termination of the licensing agreement with United Therapeutics, effective August 28, 2023[153]. - The company made upfront payments totaling $7 million (equivalent to RMB 46.4 million) to Tetraphase Pharmaceuticals for the exclusive licensing agreement for Eravacycline[154]. - The company has agreed to make milestone payments of $8 million (equivalent to RMB 55.4 million) following the approval of Eravacycline's new drug application in China[154]. Financial Liabilities and Assets - Total liabilities decreased significantly to RMB 477,370,000 from RMB 960,255,000, indicating a stronger balance sheet[100]. - The total financial liabilities as of June 30, 2023, were RMB 445,333 thousand, a decrease from RMB 937,526 thousand as of December 31, 2022[122]. - The company’s total assets as of June 30, 2023, were RMB 2,656,428 thousand, down from RMB 3,412,655 thousand at the end of 2022, representing a decrease of 22.1%[181].

Financial Performance - Everest Medicines' stock price increased by 37% in the first half of 2023, outperforming the Hang Seng Hong Kong-listed biotech index and the Hang Seng Index, which fell by 23.41% and 4.3% respectively[10]. - Revenue increased from RMB 1.0 million for the six months ended June 30, 2022, to RMB 8.9 million for the six months ended June 30, 2023, primarily due to sales of the product Yiga in Singapore and sales of Trodelvy® during the transition period with Gilead Sciences[20]. - The company recorded a loss of RMB 423.6 million for the six months ended June 30, 2023, compared to a loss of RMB 668.0 million for the same period in 2022[29]. - Adjusted loss decreased from RMB 523.7 million for the six months ended June 30, 2022, to RMB 326.9 million for the six months ended June 30, 2023, primarily due to the reduction in IFRS losses[21]. - The company reported a comprehensive loss for the six months ended June 30, 2023, with financial data presented in thousands of RMB[98]. - The basic loss per share attributable to shareholders was RMB (1.40), an improvement from RMB (2.26) in the previous year[99]. - Operating loss narrowed from RMB 639.7 million in the first half of 2022 to RMB 478.9 million in the first half of 2023, a reduction of approximately 25.1%[36]. - The company reported a significant increase in cash and cash equivalents, with a total of RMB 2,540,167 thousand as of June 30, 2023, compared to RMB 1,651,376 thousand at the end of 2022, marking a growth of 53.8%[186]. Product Development and Pipeline - The company transitioned from a clinical-stage biotech firm to a commercial-stage company, launching its first product, Eiger, in July 2023 for treating complex intra-abdominal infections[10]. - Three additional candidate drugs are expected to receive NDA approval or submission in 2023 and 2024, including the kidney disease treatment, Neficor, which is anticipated to gain NDA approval later this year in China and Singapore[10]. - The company plans to submit NDA applications for a novel antibiotic, Cefepime-Tazobactam, and Etrasimod for ulcerative colitis in the near term[10]. - Everest Medicines is expanding its product portfolio through acquisitions and in-house development, focusing on innovative and differentiated therapies[10]. - The company is developing the bivalent COVID-19 booster candidate vaccine EVER-COVID19-M1.2 targeting the Omicron variant, with an IND application submitted in China[19]. - The product pipeline includes potential first-in-class or best-in-class therapies and vaccines, with ongoing research in infectious diseases and oncology using a clinically validated mRNA platform[22]. - The company aims to provide long-term value to shareholders and patients by expanding its product pipeline and entering commercialization phases for various products[22]. Research and Development - R&D expenses decreased from RMB 345.5 million for the six months ended June 30, 2022, to RMB 288.5 million for the six months ended June 30, 2023, mainly due to multiple candidates completing clinical trials and entering registration or commercialization stages[20]. - The company established a commercial team of 138 members focused on key treatment areas, including anti-infection and nephrology, as of June 30, 2023[24]. - Clinical trial and research expenses decreased from RMB 141.971 million in 2022 to RMB 129.876 million in 2023, a decrease of about 8.5%[31]. - The company continues to invest in research and development, with ongoing projects aimed at enhancing its product offerings and market position[151]. Financial Management and Expenses - General and administrative expenses reduced from RMB 118.9 million for the six months ended June 30, 2022, to RMB 83.1 million for the six months ended June 30, 2023, attributed to organizational optimization and a decrease in related share-based compensation expenses[20]. - Sales and marketing expenses decreased from RMB 148.2 million for the six months ended June 30, 2022, to RMB 64.1 million for the six months ended June 30, 2023, primarily due to the transfer of Trodelvy® commercialization activities to Gilead and organizational optimization[20]. - Employee benefits expenses decreased from RMB 182.145 million in 2022 to RMB 111.719 million in 2023, a reduction of approximately 38.7%[31]. - The total cost of revenue, general and administrative expenses, research and development expenses, and distribution and selling expenses amounted to RMB 480,059 thousand in the first half of 2023, compared to RMB 612,945 thousand in 2022, showing a reduction of approximately 21.6%[129]. Regulatory Approvals and Clinical Trials - Nefecon received global innovative product fast track review designation from MFDS for treating primary IgAN, expected to accelerate regulatory review time by 25%[11]. - NDA for Nefecon accepted in Singapore for adults at risk of disease progression, with approval expected in 2023[12]. - sNDA submitted to FDA for TARPEYO based on complete data from NeflgArd Phase 3 trial, with a PDUFA target date of December 20, 2023[13]. - Etrasimod's NDA for moderate to severe active UC is under review by FDA, with a decision expected in the second half of 2023[18]. - Etrasimod Phase 3 trial patient recruitment completed in Asia for treating moderate to severe active UC[17]. - Igarasin approved in China for treating adult patients with cIAI, marking the company's first commercial product in the region[15]. - The company plans to submit NDA for Igarasin in Taiwan in 2023[15]. - The company anticipates NDA approvals for Nefecon in mainland China and Singapore in 2023[14]. Shareholder and Equity Information - As of June 30, 2023, Mr. Bo Wei held 42.24% of the company's shares, totaling 133,526,552 shares[69]. - The total number of issued shares is 316,084,572[76]. - The company has established four share plans, including pre-IPO management and employee stock option plans, and post-IPO stock option and incentive plans[77]. - The company has granted unexercised stock options totaling 3,657,511 shares to 105 participants, including directors and senior management[81]. - The company has 11,204,645 shares available for grant under the post-IPO share option plan as of August 30, 2023, following the approval of an additional 4,700,000 share options by independent shareholders[88]. Investments and Acquisitions - The company recognized an impairment loss of $7.5 million (equivalent to RMB 52.0 million) related to intangible assets due to the termination of the licensing agreement with United Therapeutics, effective August 28, 2023[153]. - The company made upfront payments totaling $7 million (equivalent to RMB 46.4 million) to Tetraphase Pharmaceuticals for the exclusive licensing agreement for Eravacycline[154]. - The company has agreed to make milestone payments of $8 million (equivalent to RMB 55.4 million) following the approval of Eravacycline's new drug application by Chinese regulatory authorities in March 2023[154]. - The total upfront fees for the exclusive global licensing agreement with Novartis for FGF401 amounted to $20 million (equivalent to RMB 132.7 million) plus the issuance of 4 million shares of convertible preferred stock[157]. - The company paid a total of $5 million (equivalent to RMB 33.2 million) as an upfront cash payment to Venatorx for the exclusive licensing agreement for Taniborbactam[159].

Financial Performance - Revenue increased from RMB 54 million in 2021 to RMB 12.8 million in 2022, primarily due to sales of Xerava and Trodelvy® in Singapore[13]. - The net loss for the year ended December 31, 2022, was RMB 247.3 million, a significant reduction from RMB 1,008.7 million in 2021, largely due to other income from the Trodelvy® transaction[13]. - Adjusted loss for the year ended December 31, 2022, was RMB 17.4 million, a decrease from RMB 777.3 million in 2021, reflecting improved financial performance[14]. - The company reported a loss of RMB 247.3 million for the year ended December 31, 2022, compared to a loss of RMB 1,008.7 million for the year ended December 31, 2021, primarily due to gains from the sale of Trodelvy®[43][56]. - Revenue for the year ended December 31, 2022, was RMB 12.8 million, generated from the sales of Ilaris and Trodelvy® in Singapore[44]. - Research and development expenses increased from RMB 613.4 million in 2021 to RMB 809.7 million in 2022, attributed to an increase in clinical trial numbers and expansion of the internal drug discovery team[43][44]. - Distribution and selling expenses rose from RMB 198.2 million in 2021 to RMB 326.7 million in 2022, mainly due to increased employee benefits and pre-commercialization activities[46]. - General and administrative expenses increased from RMB 242.7 million in 2021 to RMB 276.5 million in 2022, primarily due to higher professional service fees[47]. - Other net income surged to RMB 1,143.4 million in 2022 from RMB 22.9 million in 2021, primarily due to proceeds from the sale of Trodelvy®[50]. - Operating loss decreased from RMB 1,026.3 million in 2021 to RMB 256.8 million in 2022, mainly due to gains from the Trodelvy® transaction[51]. Strategic Direction and Growth - Everest Medicines' stock increased over 300% from a low of HKD 6.18 on October 31, 2022, to January 31, 2023, following the announcement of a new strategic direction[7]. - The company returned the rights to Trodelvy to Gilead Sciences to improve its balance sheet, focusing on key therapeutic areas with strong market potential[7]. - The new CEO, Mr. Luo Yongqing, appointed in September 2022, is expected to lead the company into a new phase of growth in commercial and clinical operations[7]. - The company aims to leverage its clinically validated mRNA technology platform to advance projects in its key therapeutic areas[7]. - Everest Medicines is seeking promising business development opportunities to acquire global rights to assets while enhancing its internal drug discovery team[7]. - The company has streamlined operations to improve organizational efficiency and adapt to external macroeconomic conditions[7]. - The company is committed to becoming a comprehensive biopharmaceutical company in the commercialization stage by 2023[7]. - Everest Medicines' strategic transformation in 2022 is aimed at better adapting to the evolving market landscape[7]. - The company is committed to developing new vaccines for major infectious diseases and cancer using its clinically validated mRNA technology platform[12]. - The company aims to commercialize Xerava and Nefecon in 2023, actively building a commercialization team to ensure successful product launches[32]. - The company is preparing for the commercialization of Xerava and Nefecon, with a dedicated commercial team being established[40]. - The company plans to advance existing clinical trials and initiate new ones, aiming for rapid market entry of therapies and vaccines[41]. Clinical Development and Product Pipeline - Significant progress was made in clinical development, production capacity, and internal drug discovery throughout 2022, particularly in kidney and infectious diseases[8]. - The company submitted a New Drug Application (NDA) for Nefecon in China for the treatment of primary IgA nephropathy, based on positive Phase 3 clinical trial data from 62 patients[9]. - The mRNA vaccine production facility, operational since December 2022, has an annual capacity of 700 million doses, supporting the company's growth strategy[10]. - The clinical team achieved significant progress in advancing potential best-in-class therapies for kidney disease and infectious diseases, with the mRNA vaccine production capacity reaching 700 million doses annually at the new facility in Zhejiang, China[8]. - Nefecon (TarpeyoTM) showed a statistically significant improvement in eGFR, with an average increase of 5.05 mL/min/1.73 m² compared to placebo over two years, and the treatment demonstrated a decline of only -2.47 mL/min/1.73 m² versus -7.52 mL/min/1.73 m² for placebo[19]. - The National Medical Products Administration of China accepted the new drug application for Nefecon for primary IgA nephropathy, which is expected to receive priority review[18]. - Xerava received approval from the National Medical Products Administration of China for commercialization, marking it as the first product for the company in China[8]. - The company announced the successful preclinical proof of concept for the mRNA rabies vaccine, showcasing its internal drug discovery capabilities[23]. - The company is advancing a bivalent COVID-19 booster candidate vaccine targeting the Omicron variant, with ongoing rolling submissions for IND applications[22]. - EVER001, a next-generation BTK inhibitor for kidney disease, received IND approval for a Phase 1b clinical trial[19]. - The company expects to submit new drug applications for Nefecon in South Korea, Hong Kong, and Taiwan in 2023[19]. - The company plans to submit a new drug application for Taniborbactam for treating cUTI in China in 2023[26]. - EVER206 showed good tolerability in a Phase 1 clinical study with no acute kidney injury observed, supporting its progression to Phase 3 trials[26]. - Etrasimod achieved a clinical remission rate of 27.0% at week 12 in the ELEVATE UC study, compared to 7.4% for the placebo group, with a significant difference of 19.8%[28]. - The FDA is expected to make a decision on the new drug application for Etrasimod in the second half of 2023, marking its first potential approval globally[28]. Collaborations and Licensing Agreements - The company established an exclusive collaboration with Taiwan Dongyang Pharmaceutical for the commercialization of Xerava in Taiwan[9]. - The company signed a licensing agreement with Calliditas for Nefecon in South Korea, expanding its international commercial footprint[30]. - The agreement with Immunomedics allows the company to receive up to $455 million, including an upfront payment of $280 million, for the development and commercialization of Trodelvy in several regions[30]. - The company has established an exclusive collaboration with Taiwan Dongyang for the commercialization of Xerava in Taiwan, leveraging their experience in launching new antibiotics[24]. Governance and Management - The company is committed to maintaining a strong governance structure with a diverse board composition[186]. - The management team includes experienced professionals from various sectors, enhancing the company's strategic capabilities[191]. - The company has established a remuneration committee to determine and recommend compensation policies for directors and senior management[168]. - The company emphasizes the importance of strong governance with the appointment of independent directors to enhance oversight and strategic direction[193][194][196]. - The company has not entered into any management or administrative contracts for the majority of its business as of December 31, 2022[101]. - The board consists of four executive directors, two non-executive directors, and three independent non-executive directors as of the last practicable date[186]. - Mr. Luo Yongqing was appointed as the CEO and executive director on September 19, 2022, bringing over 25 years of experience in the healthcare industry[186]. - The company has not disclosed any significant events affecting its operations since the end of the reporting period[184]. Employee and Compensation - The group reported a total employee compensation cost of RMB 853.1 million for the year ended December 31, 2022, an increase from RMB 574.8 million in the previous year[88]. - As of December 31, 2022, the group had 365 employees, a decrease from 405 employees in 2021[85]. - The group’s clinical development team comprised 36.16% of total employees, indicating a strong focus on this area[86]. - The total compensation for directors for the year ended December 31, 2022, was approximately RMB 68.7 million[168]. - The company has granted stock options to directors, with Mr. Luo Yongqing eligible for up to 4,700,000 shares under the post-IPO stock option plan[105]. Market and Investment - The Hong Kong-listed biotechnology sector showed signs of recovery in late 2022, positively impacting investor sentiment towards Everest Medicines[7]. - The company has established a strong product pipeline, including potential first-in-class or best-in-class therapeutic assets and mRNA vaccines, covering short, medium, and long-term opportunities[33]. - The company has entered into a licensing agreement with Calliditas to expand rights in Greater China and Singapore to Korea[37]. - The company plans to fully utilize the remaining unutilized net proceeds by the second half of 2024[181]. - The company has not been involved in any significant litigation or arbitration as of December 31, 2022[176]. Risk Factors - The group faced significant risks including financial condition, clinical development uncertainties, and reliance on business partners and third parties[81]. - The group has no significant contingent liabilities as of December 31, 2022, indicating a stable financial position[70]. - The company has not entered into any hedging transactions to manage foreign currency risks, which may affect operational performance due to currency fluctuations[71].

Stock Performance and Market Sentiment - Everest Medicines Limited's stock price increased over 300% from a low of HKD 6.18 on October 31, 2022, to January 31, 2023, following the announcement of a new strategic direction[8] - The Hong Kong-listed biotechnology index rebounded in late 2022, positively impacting investor sentiment towards Everest Medicines[8] Strategic Direction and Leadership - The company plans to streamline operations and focus on key therapeutic areas with strong market potential after divesting Trodely to Gilead Sciences[8] - A new CEO, Luo Yongqing, was appointed in September 2022 to lead the company into a new phase of growth and commercialization[8] - The company is committed to seeking business development opportunities to introduce globally licensed assets while developing its internal capabilities[8] Clinical Development and Product Pipeline - Significant progress was made in clinical development, manufacturing capabilities, and internal drug discovery throughout 2022[9] - The company aims to leverage its clinically validated mRNA technology platform to advance projects in key therapeutic areas[8] - The company submitted a New Drug Application (NDA) for Nefecon in China for the treatment of primary IgA nephropathy, based on positive Phase 3 clinical trial data involving 62 patients[10] - The mRNA COVID-19 vaccine candidate PTX-COVID19-B demonstrated statistical non-inferiority in neutralizing antibodies compared to Comirnaty® in a head-to-head clinical trial, providing clinical validation for the mRNA platform[10] - Xerava has been approved for the treatment of complicated intra-abdominal infections in Hong Kong and Singapore, with commercialization achieved in Singapore in 2022[10] - The company achieved significant progress in various aspects of its business and pipeline as of December 31, 2022, including the acceptance of the new drug application for Nefecon by the National Medical Products Administration (NMPA) in China[17] Financial Performance - The company reported a net loss of RMB 247.3 million for the year ended December 31, 2022, a significant reduction from a loss of RMB 1,008.7 million in 2021, largely due to other income from the Trodelvy® transaction[14] - The adjusted loss for the year ended December 31, 2022, was RMB 17.4 million, a significant improvement from RMB 77.3 million in 2021[15] - The company's revenue for the year ended December 31, 2022, was RMB 12.8 million, compared to RMB 12.8 million for the year ended December 31, 2021[41] - Other net income surged to RMB 1,143.4 million in 2022 from RMB 22.9 million in 2021, primarily attributed to the sale proceeds from the Trodelvy® transaction[48] - The loss attributable to equity holders of the company decreased from RMB 1,008.7 million in 2021 to RMB 247.3 million in 2022, mainly due to the sale proceeds from the Trodelvy® transaction[54] Research and Development Expenses - Research and development (R&D) expenses increased from RMB 613.4 million in 2021 to RMB 809.7 million in 2022, primarily due to additional clinical trials and expanded internal drug discovery capabilities[14] - Distribution and selling expenses rose from RMB 198.2 million in 2021 to RMB 326.7 million in 2022, mainly due to increased employee benefits and pre-commercialization activities[44] - General and administrative expenses increased from RMB 242.7 million in 2021 to RMB 276.5 million in 2022, primarily due to higher professional service fees[45] Manufacturing and Production Capacity - The mRNA vaccine production facility commenced operations in December 2022, with an annual production capacity of 700 million doses[11] - The global production facility in Jiaxing, Zhejiang, commenced operations in December 2022, with an annual production capacity of 700 million doses for mRNA vaccines[17] - The company completed the first phase of its Jiaxing factory construction in September 2022, with mRNA vaccine production starting in December 2022[30] Regulatory Approvals and Market Launch - The company expects to obtain new drug marketing approval for Nefecon in mainland China and Singapore in 2023[19] - Xerava received approval from the NMPA for commercialization in China, marking it as the first product for the company in the region[17] - The company plans to establish an internal commercialization team for Xerava and Nefecon in preparation for their market launch in 2023[13] Risk Management and Corporate Governance - The company has faced several key risks, including uncertainties in clinical development outcomes and reliance on business partners and third parties[77] - The company has a robust corporate governance culture that reflects its commitment to ethical business practices[185] - The company has adopted the corporate governance code as a baseline for its governance practices, ensuring compliance throughout the reporting period[186] Shareholder and Employee Matters - The board did not recommend the payment of a final dividend for the year ended December 31, 2022, consistent with the previous year[89] - The company reported a total employee count of 365 as of December 31, 2022, down from 405 in 2021, with 36.16% in clinical development[81] - Total employee compensation costs amounted to RMB 853.1 million for the year ended December 31, 2022, compared to RMB 574.8 million for the previous year[83] Future Outlook and Strategic Initiatives - The company plans to expand its market presence and is exploring new product development strategies[149] - The company is actively exploring acquisition opportunities in key therapeutic areas to enhance its growth strategy[34] - The management team highlighted a strategic shift towards digital transformation, aiming for a G% increase in online sales channels[176]