亚盛医药(06855) - 2024 - 中期业绩

Performance Highlights Financial Highlights H1 2024 revenue surged 477.2% to RMB 823.7 million, primarily from IP income, turning a RMB 402.3 million loss into RMB 162.8 million net profit Key Financial Indicators for H1 2024 | Indicator | H1 2024 | H1 2023 | YoY Change | | :--- | :--- | :--- | :--- | | Revenue | RMB 823.7 million | RMB 142.7 million | +477.2% | | R&D Expenses | RMB 444.1 million | RMB 309.8 million | +43.4% | | Administrative Expenses | RMB 87.0 million | RMB 91.3 million | -4.7% | | Profit/(Loss) for the Period | RMB 162.8 million | (RMB 402.3 million) | Turned Profitable | - Significant revenue growth primarily stemmed from intellectual property income, pharmaceutical product sales, commercialization rights income, and service revenue[2] - As of June 30, 2024, the Group's cash and bank balances totaled RMB 1.1003 billion, with an additional USD 100 million option payment received from Takeda Pharmaceutical in July 2024[3] Business Highlights The company achieved significant business milestones, including a major strategic partnership for Olverembatinib with Takeda and key pipeline products advancing to Phase III - An exclusive option agreement was signed with Takeda Pharmaceutical for core product Olverembatinib, granting Takeda exclusive global development and commercialization rights outside Greater China[4] Strategic Collaboration Financial Terms with Takeda Pharmaceutical | Item | Amount | | :--- | :--- | | Exclusive Option Payment | USD 100 million (received in July 2024) | | Option Exercise Fee and Potential Milestone Payments | Up to approximately USD 1.2 billion | | Sales Royalties | Double-digit percentage of annual sales | | Equity Investment | USD 75 million | - Core product Olverembatinib's sales revenue in H1 2024 increased by 120% compared to H2 2023 and 5% compared to H1 2023[4] - Key candidate product lisaftoclax (APG-2575) received approval to conduct a registrational Phase III clinical study (GLORA-4) for MDS patients[5] - Olverembatinib received approval to conduct a registrational Phase III clinical trial (POLARIS-3) for SDH-deficient GIST patients and a registrational Phase III clinical trial (POLARIS-2) for CML-CP patients in the US[5] Management Discussion and Analysis Business Overview The company is a global biopharmaceutical company focused on innovative therapies for hematological malignancies, with core product Olverembatinib commercialized in China and a strong global IP portfolio - The company focuses on discovering, developing, and commercializing first-in-class and best-in-class therapies to address global unmet medical needs in hematological malignancies[8] - Core product Olverembatinib is China's first and only approved third-generation BCR-ABL inhibitor for T315I-mutated CML patients[8] - As of June 30, 2024, the company held 520 authorized patents globally, with 367 being overseas authorized patents[9] Pipeline Review The company has six clinical-stage small molecule candidates targeting various pathways, with core and key products advancing in multiple registrational clinical studies Product Pipeline as of June 30, 2024 | Candidate Product | Mechanism | Primary Indication | Clinical Stage | | :--- | :--- | :--- | :--- | | Olverembatinib (HQP1351) | BCR-ABL/KIT | Drug-resistant CML, GIST, etc. | Marketed/Phase III | | Lisaftoclax (APG-2575) | Bcl-2 selective | CLL/SLL, AML, MDS, MM | Phase III/Phase II | | Alrizomadlin (APG-115) | MDM2-p53 | AML, MDS, Solid Tumors | Phase II/Phase I | | Pelcitoclax (APG-1252) | Bcl-2/Bcl-xL | NSCLC, SCLC, Lymphoma | Phase II/Phase I | | APG-5918 | EED selective | Oncology/Anemia | Phase I | | APG-2449 | FAK/ALK/ROS1 | NSCLC/Solid Tumors | Phase I | Olverembatinib As China's first and only approved third-generation BCR-ABL inhibitor, Olverembatinib is included in national medical insurance, approved in Macau, and advancing global Phase III trials for GIST and CML - In July 2024, Olverembatinib was officially approved for marketing by the Macao Pharmaceutical Administration Bureau (ISAF)[14] - In May 2024, NMPA approved the initiation of a registrational Phase III clinical study (POLARIS-3) for SDH-deficient GIST patients[14] - In February 2024, the US FDA granted permission to conduct a registrational Phase III clinical trial (POLARIS-2) for CML-CP patients[14] - The company expects to apply for inclusion of the indication for drug-resistant/intolerant CML-CP patients in the 2024 National Medical Insurance Directory, effective early 2025[16] Lisaftoclax (APG-2575) Lisaftoclax, a novel oral Bcl-2 inhibitor, is expected to file an NDA in China for r/r CLL/SLL in 2024, with multiple global registrational Phase III studies ongoing for various hematological malignancies - An NDA for lisaftoclax for relapsed/refractory CLL/SLL is planned for submission to China NMPA in 2024, potentially becoming the world's second and China's first approved Bcl-2 inhibitor[17][20] - Recently approved by NMPA to conduct a registrational Phase III clinical study (GLORA-4) in combination with azacitidine for MDS[17] - Data presented at EHA 2024 showed an objective response rate (ORR) of 70.4% for lisaftoclax combination therapy in relapsed/refractory multiple myeloma (MM)[18] Alrizomadlin (APG-115) Alrizomadlin, an oral MDM2-p53 inhibitor with six FDA orphan drug designations, is undergoing multiple clinical studies in solid and hematological tumors, showing promising anti-tumor activity - Received six Orphan Drug Designations (ODD) and two Rare Pediatric Disease Designations (RPD) from the FDA[21] - Ongoing Ib/II studies in collaboration with Merck for combination with pembrolizumab in melanoma and other solid tumors[21] - Study results showed good anti-tumor activity and tolerability for APG-115 in patients with progressive salivary gland cancer, especially adenoid cystic carcinoma (ACC)[23] Pelcitoclax (APG-1252) Pelcitoclax, a Bcl-2/Bcl-xL dual inhibitor with FDA orphan drug designation for SCLC, is undergoing multiple combination studies in China for NSCLC, neuroendocrine tumors, and non-Hodgkin lymphoma - APG-1252 is a dual Bcl-2 and Bcl-xL protein inhibitor, granted Orphan Drug Designation by the FDA for small cell lung cancer (SCLC)[24] - Multiple combination studies are ongoing in China, including a Phase Ib study with osimertinib for EGFR-mutated NSCLC[25] APG-5918 APG-5918, a highly selective EED inhibitor, shows potential for improving CKD-related anemia and is in Phase I trials for advanced solid tumors/lymphoma in the US and anemia in China - APG-5918 is a highly selective EED inhibitor, with preliminary studies showing its potential to improve anemia caused by chronic kidney disease (CKD)[26] - Approved for clinical trials for anemia-related indications in China, with single-dose escalation studies in healthy subjects completed[27] Other Clinical or IND Stage Candidate Drugs APG-2449, the first domestic third-generation ALK inhibitor and FAK/ALK/ROS1 triple kinase inhibitor, shows preliminary efficacy in NSCLC patients, including those with brain metastases - APG-2449 is the first domestic third-generation ALK inhibitor, also a FAK/ALK/ROS1 triple kinase inhibitor[28] - ASCO annual meeting data showed preliminary efficacy for APG-2449 in TKI-naive and second-generation ALK TKI-resistant NSCLC patients, with initial inhibitory effects on brain metastases[28] Discovery Pipeline The company is developing targeted protein degraders (TPD) to address drug resistance, with a p53-MDM2 pathway degrader in preclinical development and a low platelet toxicity Bcl-xL degrader underway - The company is developing Targeted Protein Degraders (TPD) to address drug resistance issues with traditional drugs[29] - The first orally active degrader targeting the p53-MDM2 pathway has entered preclinical development[29] - A Bcl-xL protein degrader with potential for low platelet toxicity is under development, with a preclinical candidate nomination expected by year-end[29] R&D, Commercialization and Business Development R&D investment grew in H1 2024, with core product Olverembatinib showing strong commercialization progress and the Takeda strategic collaboration significantly advancing its global reach R&D Expenses | Period | Amount | | :--- | :--- | | H1 2024 | RMB 444.1 million | | H1 2023 | RMB 309.8 million | - Core product Olverembatinib (HQP1351) achieved RMB 112.92 million in VAT-inclusive sales revenue in H1 2024[32] - As of June 30, 2024, the product was accessible in 670 hospitals and DTP pharmacies nationwide, supported by a commercial team of approximately 100 people[32] - The Suzhou industrialization base successfully completed GMP batch production of Olverembatinib tablets, supporting clinical supply in China and globally[35] - The exclusive option agreement with Takeda Pharmaceutical will leverage Takeda's global commercial expertise to expand Olverembatinib's accessibility to patients worldwide[36] Financial Statements and Review Condensed Consolidated Financial Statements H1 2024 financial statements show RMB 823.7 million revenue and RMB 162.8 million net profit, with total assets increasing to RMB 3.107 billion and net assets significantly rising to RMB 776.4 million Key Data from Condensed Consolidated Statement of Profit or Loss (RMB Thousand) | Item | H1 2024 (Unaudited) | H1 2023 (Unaudited) | | :--- | :--- | :--- | | Revenue | 823,746 | 142,701 | | Gross Profit | 808,687 | 124,547 | | R&D Expenses | (444,079) | (309,814) | | Profit/(Loss) before Tax | 162,895 | (399,603) | | Profit/(Loss) for the Period | 162,826 | (402,349) | Key Data from Condensed Consolidated Statement of Financial Position (RMB Thousand) | Item | June 30, 2024 (Unaudited) | December 31, 2023 (Audited) | | :--- | :--- | :--- | | Total Non-current Assets | 1,143,231 | 1,156,215 | | Total Current Assets | 1,963,839 | 1,344,178 | | Cash and Bank Balances | 1,100,314 | 1,093,833 | | Total Current Liabilities | 1,065,350 | 934,173 | | Total Non-current Liabilities | 1,265,281 | 1,495,588 | | Net Assets | 776,439 | 70,632 | Financial Review This section details the 477.2% revenue increase, primarily from IP income, a 43.4% rise in R&D expenses, and decreases in administrative and finance costs, leading to a RMB 162.8 million net profit - Revenue increased by RMB 681 million or 477.2% year-on-year, primarily due to the combined impact of intellectual property income, pharmaceutical product sales, commercialization rights income, and service revenue[70] - R&D expenses increased by RMB 134.3 million or 43.4% year-on-year, mainly due to increased internal R&D activities[73] - Administrative expenses decreased by RMB 4.3 million or 4.7% year-on-year, primarily due to reduced staff costs and operating depreciation expenses at the Suzhou base[75] - Finance costs decreased by RMB 18.6 million or 35.3% year-on-year, mainly due to reduced interest on bank borrowings[77] - As a result of the aforementioned factors, the company's net profit turned from a RMB 402.3 million loss in the prior period to a RMB 162.8 million profit[79] Key Financial Ratios and Liquidity The company's financial position significantly improved, with current and quick ratios increasing to 1.8, and the debt-to-asset ratio sharply decreasing to 77.2%, indicating stronger solvency and a more robust financial structure Key Financial Ratios | Ratio | June 30, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Current Ratio | 1.8 | 1.4 | | Quick Ratio | 1.8 | 1.4 | | Debt-to-Asset Ratio | 77.2% | 993.5% | - As of June 30, 2024, the Group's cash and bank balances amounted to RMB 1.1003 billion, largely consistent with year-end 2023[89] - As of June 30, 2024, the Group's total interest-bearing bank and other borrowings amounted to RMB 1.700 billion[85][87] Other Information Employees and Remuneration Policy As of June 30, 2024, the company had 574 full-time employees, with 70.9% in R&D, reflecting its R&D-centric strategy, and implemented incentive plans to attract and retain talent Employee Distribution by Function (as of June 30, 2024) | Function | Number of Employees | Percentage | | :--- | :--- | :--- | | R&D | 407 | 70.9% | | Commercial | 101 | 17.6% | | Administrative and Others | 66 | 11.5% | | Total | 574 | 100.0% | - Employee benefit expenses for H1 2024 were RMB 218.9 million, compared to RMB 201.2 million in the prior period[92] Future and Outlook The company plans to accelerate clinical development and global NDA applications for six candidate drugs, seek global partnerships, and strengthen its global intellectual property portfolio to become a leading biotech company - The company will accelerate the advancement of six candidate drugs in its highly differentiated novel clinical pipeline to the next clinical stage and pursue global NDA applications[94] - Plans to actively seek strategic partnerships with global biotechnology and pharmaceutical companies to seize global commercialization opportunities[94] - Will further strengthen its comprehensive and growing global intellectual property portfolio to safeguard shareholder interests[94] Corporate Governance and Other Information The company adheres to corporate governance codes, detailing the use of proceeds from past placings and the USD 75 million Takeda share subscription, primarily for core product and key candidate development - The roles of Chairman and CEO are held by the same person (Dr. Yang), with the Board believing the existing structure does not affect the balance of power and accountability[95] - Net proceeds from the 2023 placing were approximately HKD 543.9 million, with RMB 119.5 million remaining unused as of June 30, 2024, expected to be fully utilized by end of 2024[107][108] - Net proceeds from the 2024 share issuance to Takeda Pharmaceutical were approximately USD 73 million, with 90% planned for the development of core product HQP1351 and key candidate APG-2575, and 10% for other key candidates, expected to be utilized by end of 2025[113][114] - The Board does not recommend the payment of an interim dividend for the six months ended June 30, 2024[117]