德琪医药-B(06996) - 2024 - 中期业绩

Financial and Business Summary Financial Summary In H1 2024, revenue decreased by 15.6% to RMB 60.78 million, yet net loss significantly narrowed from RMB 219 million to RMB 167 million due to substantial expense reductions Key Financial Indicators H1 2024 (RMB thousand) | Indicator | H1 2024 (Unaudited) | H1 2023 (Unaudited) | Y-o-Y Change | | :--- | :--- | :--- | :--- | | Revenue | 60,779 | 72,016 | -15.6% | | R&D Costs | (130,841) | (226,093) | -42.1% | | Sales & Distribution Expenses | (56,028) | (88,246) | -36.5% | | Administrative Expenses | (58,478) | (83,756) | -30.2% | | Loss for the Period | (167,033) | (218,694) | +23.6% (Loss narrowed) | | Adjusted Loss for the Period* | (152,567) | (189,437) | +19.5% (Loss narrowed) | - Revenue decline was primarily due to price reductions for core product XPOVIO® (Selinexor) after its inclusion in the National Reimbursement Drug List in December 2023, and transitional impacts from the initial commercialization partnership with Hansoh Pharmaceutical; however, significant sales volume increases largely offset the price decrease[3] - R&D costs decreased by RMB 95.3 million year-on-year, mainly due to reduced employee costs and drug development expenses from improved R&D efficiency, along with lower licensing fees[3] - Sales and distribution expenses decreased by RMB 32.2 million year-on-year, primarily due to no new APAC commercialization milestone payments in 2024 and reduced Greater China-related expenses following the partnership with Hansoh Pharmaceutical[3] Business Summary During the reporting period, the company achieved significant pipeline and operational advancements, including Selinexor's (XPOVIO®) expanded market access in Korea and China, positive data for Onatasertib in cervical cancer, and steady progress across multiple clinical-stage assets - Commercialization Asset Progress: * Selinexor (ATG-010, XPOVIO®): * Approved for reimbursement in Korea for rrMM in June 2024, effective July 1 * Received NMPA approval in China for a new indication in rrDLBCL in July 2024[4] - Late-Stage Asset Progress: * Onatasertib (ATG-008): I/II TORCH-2 study results showed an ORR of 53.3% and DCR of 86.7% when combined with toripalimab in cervical cancer patients, with good tolerability[4] - Other Clinical-Stage Asset Progress: * ATG-101 (PD-L1/4-1BB): Phase I trials are ongoing in China, Australia, and the US * ATG-037 (CD73 Inhibitor): Phase I trials are ongoing in China and the US * ATG-022 (Claudin 18.2 ADC): Phase II CLINCH trial initiated in China and Australia, with Phase I data showing preliminary efficacy * ATG-031 (Anti-CD24 mAb): Phase I PERFORM trial is ongoing in the US[4][5] - During the reporting period, the company did not engage in any new business development activities, strategically focusing on advancing core R&D projects[5] Management Discussion and Analysis Company Overview Antengene is a commercial-stage biopharmaceutical company focused on innovative oncology drugs in APAC, with a 'combination and complementary' R&D strategy encompassing one commercial product and eight clinical-stage programs - The company is positioned as a commercial-stage biopharmaceutical company in the Asia-Pacific region, focusing on innovative oncology drugs[7] - The company employs a 'combination and complementary' R&D strategy, with a pipeline comprising one commercial product, eight clinical-stage projects, and multiple preclinical projects[7] Product Pipeline The company's oncology-focused pipeline includes 10 drug candidates from preclinical to commercial stages, featuring core product Selinexor (ATG-010) and late-stage asset Onatasertib (ATG-008) in Phase II clinical trials Key Product Pipeline and Status | Investigational Product | Target (Drug Type) | Key Indication | Development Stage | | :--- | :--- | :--- | :--- | | ATG-010 (Selinexor) | XPO1 (Small Molecule) | rrMM, rrDLBCL | Commercialized/Phase III | | ATG-008 (Onatasertib) | mTORC1/2 (Small Molecule) | Cervical Cancer & Advanced Solid Tumors | Phase II Clinical | | ATG-022 | Claudin 18.2 (ADC) | Solid Tumors | Phase II Clinical | | ATG-037 | CD73 (Small Molecule) | Hematologic Malignancies/Solid Tumors | Phase I Clinical | | ATG-101 | PD-L1/4-1BB (Bispecific Antibody) | Hematologic Malignancies/Solid Tumors | Phase I Clinical | | ATG-031 | CD24 (Monoclonal Antibody) | Hematologic Malignancies/Solid Tumors | Phase I Clinical | Business Review H1 2024 saw steady business progress, with core product Selinexor (XPOVIO®) gaining expanded market access in Korea and China, advancing commercial partnerships, and positive clinical data reported for multiple pipeline assets Commercialization Stage Product: Selinexor (ATG-010) Selinexor (XPOVIO®), the company's first commercial product, achieved key advancements during and after the reporting period, including expanded approvals and reimbursement in APAC, and a commercialization partnership with Hansoh Pharmaceutical in mainland China - A collaboration agreement with Hansoh Pharmaceutical for XPOVIO®'s commercialization in mainland China entitles Antengene to an upfront payment of up to RMB 200 million and milestone payments of up to RMB 535 million[11] - In December 2023, XPOVIO® was included in China's National Reimbursement Drug List for relapsed/refractory multiple myeloma, effective January 1, 2024[11] - In June 2024, it received reimbursement approval for rrMM in Korea; in the same month, it was approved for a new indication in rrDLBCL in China[9] Late-Stage Candidate Product: ATG-008 (Onatasertib) ATG-008 (Onatasertib), an mTORC1/2 inhibitor, is undergoing a Phase I/II TORCH-2 study in combination with toripalimab for cervical cancer, with recent positive results presented at ASCO 2024 demonstrating good anti-tumor activity and tolerability - The Phase I/II TORCH-2 study showed that ATG-008 combined with toripalimab achieved an ORR of 53.3% and a DCR of 86.7% in CPI-naïve cervical cancer patients[13] Other Clinical Candidate Drugs Several other clinical candidates are progressing positively, including ATG-101 (PD-L1/4-1BB bispecific) in multi-country Phase I studies, ATG-037 (CD73 inhibitor) completing Phase I, ATG-022 (Claudin 18.2 ADC) initiating Phase II with two FDA Orphan Drug Designations, and ATG-031 (CD24 antibody) completing its first dosing level in Phase I - ATG-101 (PD-L1/4-1BB bispecific antibody) received Orphan Drug Designation from the US FDA for the treatment of pancreatic cancer[13] - ATG-022 (Claudin 18.2 ADC) has initiated Phase II trials and received two Orphan Drug Designations from the FDA for gastric and pancreatic cancer[14] - ATG-031 (CD24 antibody) Phase I trial completed first patient dosing in December 2023 and has passed the initial dosing level[15] Research and Development The company focuses on differentiated 'combination and complementary' R&D strategies for cancer treatment, with nine clinical studies ongoing and adjusted R&D costs significantly reduced to RMB 122 million in H1 2024, while strengthening its intellectual property portfolio - As of June 30, 2024, the company has nine clinical studies ongoing in mainland China, the US, and Australia[16] R&D Cost Comparison (Non-IFRS) | Period | Adjusted R&D Costs (RMB million) | | :--- | :--- | | H1 2024 | Approx. 121.7 | | H1 2023 | Approx. 207.7 | - As of June 30, 2024, the company has filed nine patent applications in mainland China and eleven international applications under PCT[16] Future and Outlook The company plans to advance its 'combination and complementary' R&D strategy, developing nine clinical-stage products through a dual-engine approach of external partnerships and internal discovery, while preparing for XPOVIO®'s APAC launch with its experienced commercial team - Continue advancing the development of nine clinical-stage products across multiple therapeutic areas[19] - Continue implementing a dual-engine approach of external collaborations and internal discovery to build a global and APAC pipeline[19] - Leverage the experience of the core commercial team to prepare for XPOVIO®'s first-in-class launch in the APAC region[19] Financial Review H1 2024 revenue was RMB 60.8 million, a 15.6% decrease due to XPOVIO® price adjustments and commercial transition, partially offset by sales volume growth, while significant cost controls led to a narrowed loss from RMB 219 million to RMB 167 million - Revenue decreased by 15.6% from RMB 72 million to RMB 60.8 million, primarily due to price reductions for XPOVIO® after its inclusion in the National Reimbursement Drug List and transitional impacts from the partnership with Hansoh Pharmaceutical[53] - Other income and gains significantly decreased from RMB 121 million to RMB 27.3 million, mainly due to net foreign exchange gains falling from RMB 92.3 million in the prior period to RMB 6.2 million this period[54] R&D Cost Components (RMB thousand) | Item | H1 2024 | H1 2023 | | :--- | :--- | :--- | | Employee Costs | 51,327 | 86,920 | | Licensing Fees | – | 40,464 | | Drug Development Expenses | 62,479 | 76,812 | | Total | 130,841 | 226,093 | Sales & Distribution Expense Components (RMB thousand) | Item | H1 2024 | H1 2023 | | :--- | :--- | :--- | | Milestone Payments | – | 21,286 | | Employee Costs | 12,603 | 42,571 | | Market Development Expenses | 42,729 | 22,754 | | Total | 56,028 | 88,246 | - Administrative expenses decreased by 30.2% from RMB 83.8 million to RMB 58.5 million, primarily due to reduced employee costs[58] Liquidity and Financial Resources As of June 30, 2024, the company held RMB 1.024 billion in cash and bank balances, a decrease from RMB 1.188 billion at year-end 2023, primarily used for operating expenses, maintaining sufficient liquidity with a current ratio of 572.4% and a healthy gearing ratio of 32.0% Financial Position Overview (June 30, 2024) | Indicator | Amount/Ratio (RMB) | | :--- | :--- | | Cash and Bank Balances | 1.024 billion | | Current Assets | 1.113 billion | | Current Liabilities | 194.4 million | | Current Ratio | 572.4% | | Gearing Ratio | 32.0% | - Cash and bank balances are primarily held in US dollars and Renminbi[62] - As of June 30, 2024, the Group had pledged leased land totaling RMB 43 million for bank financing[64] Financial Statements Interim Condensed Consolidated Statement of Profit or Loss For the six months ended June 30, 2024, the company reported RMB 60.78 million in revenue and RMB 51.92 million in gross profit, with net loss significantly narrowing from RMB 219 million to RMB 167 million due to effective cost control, resulting in a basic and diluted loss per share of RMB 0.27 Profit or Loss Statement Summary (RMB thousand) | Item | H1 2024 | H1 2023 | | :--- | :--- | :--- | | Revenue | 60,779 | 72,016 | | Gross Profit | 51,923 | 59,367 | | Loss Before Tax | (167,033) | (218,694) | | Loss for the Period | (167,033) | (218,694) | | Basic and Diluted Loss Per Share | (0.27) RMB | (0.36) RMB | Interim Condensed Consolidated Statement of Financial Position As of June 30, 2024, the company's total assets were RMB 1.461 billion, total liabilities RMB 468 million, and net assets RMB 994 million, with RMB 1.113 billion in current assets, including RMB 1.024 billion in cash and bank balances, indicating a robust financial position and ample liquidity Statement of Financial Position Summary (RMB thousand) | Item | June 30, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Total Non-Current Assets | 348,737 | 376,763 | | Total Current Assets | 1,112,624 | 1,241,824 | | Total Assets | 1,461,361 | 1,618,587 | | Total Current Liabilities | 194,384 | 190,888 | | Total Non-Current Liabilities | 273,369 | 280,315 | | Total Liabilities | 467,753 | 471,203 | | Net Assets | 993,608 | 1,147,384 | Notes to Interim Condensed Consolidated Financial Information (Excerpts) Financial notes indicate the company operates in a single segment: R&D and commercialization of pharmaceutical products, with Greater China as the primary revenue source, accounting for 89% of total revenue, and high customer concentration, as revenue from the largest customer A comprised 88% of total revenue, while trade receivables increased from RMB 9.68 million to RMB 30.12 million Revenue from External Customers by Geographical Area (RMB thousand) | Region | H1 2024 | H1 2023 | | :--- | :--- | :--- | | Greater China | 54,044 | 67,255 | | Other Countries/Regions | 6,735 | 4,761 | | Total | 60,779 | 72,016 | - During the reporting period, revenue from a single major customer (Customer A) was RMB 53.57 million, accounting for 88.1% of total revenue[31] - Net foreign exchange gains within other income and gains significantly decreased from RMB 92.25 million in the prior period to RMB 6.18 million[33] Corporate Governance and Other Information Compliance with Corporate Governance Code During the reporting period, the company largely complied with the Corporate Governance Code, with the only deviation being the Chairman and CEO roles held by Dr. Jianming Mei, an arrangement the Board believes enhances strategic execution and communication, balanced by the board's composition including three independent non-executive directors - The company deviated from Code Provision C.2.1 of the Corporate Governance Code, where the roles of Chairman and Chief Executive Officer are held by the same individual (Dr. Jianming Mei)[65] - The Board believes this arrangement facilitates effective execution of strategic initiatives and communication, with the Board's structure providing sufficient checks and balances[65] Use of Net Proceeds As of June 30, 2024, approximately RMB 508 million of IPO net proceeds remained unutilized, with a reallocation in March 2024 to prioritize preclinical and clinical trial funding, and full utilization expected by December 31, 2025 Use of Net Proceeds (RMB million) | Item | Revised Allocation | Unutilized Amount as of June 30, 2024 | | :--- | :--- | :--- | | Clinical Development & Commercialization of Core Products | 932.63 | – | | Four Other Clinical-Stage Drugs | 117.29 | 3.60 | | Preclinical Research & Clinical Trials | 758.65 | 479.28 | | Pipeline Expansion (BD Activities) | 215.91 | 25.47 | | Total | 2,274.70 | 508.35 | - On March 22, 2024, the company reallocated approximately RMB 554 million of unutilized net proceeds to 'fund ongoing preclinical research and planned clinical trials for other preclinical candidates in our pipeline'[70]