Group 1: Palvella Therapeutics Inc. (PVLA) - Palvella is a clinical-stage biopharmaceutical company focused on developing therapies for rare diseases with no FDA-approved treatments [2] - Its lead product, QTORIN rapamycin, targets microcystic lymphatic malformations and has a multi-billion-dollar market opportunity if approved [2] - The stock rose from $25 on March 10, 2025, to a 52-week high of $114.69 on December 22, 2025, before pulling back to $99.88 [3] Group 2: Cidara Therapeutics Inc. (CDTX) - Cidara is developing a preventive therapy for influenza and has agreed to be acquired by Merck for $221.50 per share, totaling approximately $9.2 billion [4] - The stock was trading at $18.98 when profiled on November 21, 2024 [4] Group 3: Celcuity Inc. (CELC) - Celcuity is focused on targeted therapies for oncology, with its lead drug candidate Gedatolisib aimed at breast and prostate cancers [5] - The stock increased from $12.60 on December 4, 2024, to an all-time high of $112.64 on December 12, 2025, before retreating to $99.16 [6] Group 4: Nanobiotix (NBTX) - Nanobiotix is a late-stage clinical biotechnology company developing physics-based therapies for cancer [7] - Its lead candidate, NBTXR3, is undergoing a phase III study for head and neck squamous cell carcinoma, with interim data expected in the first half of 2027 [8] - The stock rose from $12.23 on September 19, 2025, to a high of $30.35 on October 13, 2025, before trading around $21 [10] Group 5: Terns Pharmaceuticals Inc. (TERN) - Terns Pharma is developing small-molecule candidates for serious diseases, with TERN-701 targeting chronic myeloid leukemia [12] - Recent data showed a 75% major molecular response rate among patients receiving higher doses [13] - The stock increased from $5.98 on August 6, 2025, to an all-time high of $48.26 on December 10, 2025, before pulling back to around $40 [14] Group 6: DBV Technologies S.A. (DBVT) - DBV Technologies is developing an epicutaneous immunotherapy for food allergies, with its lead product, the VIASKIN Peanut patch, showing positive results in a phase 3 study [15] - The company aims to submit a Biologics License Application in the first half of 2026, with potential sales of $1.5 billion by 2030 if approved [15] - The stock rose from $10.64 on October 2, 2025, to a high of $26.18 on December 17, 2025, before trading around $19 [16] Group 7: Nutex Health Inc. (NUTX) - Nutex Health reported a significant turnaround from a $424 million net loss in 2022 to a $59 million net income for the nine months ended September 30, 2025 [17] - Revenue increased from $219 million in 2022 to $723.6 million in the first nine months of 2025 [17] - The stock rose from $33.56 on November 25, 2024, to a 52-week high of $193.07 before closing at $182.23 [18] Group 8: Inhibrx Biosciences Inc. (INBX) - Inhibrx is developing biologic therapies for cancer, with Ozekibart showing significant improvement in progression-free survival in chondrosarcoma [19] - The company plans to submit a biologics license application for Ozekibart in the second quarter of 2026 [20] - The stock rose from $18.35 on July 8, 2025, to an all-time high of $94.57 on December 22, 2025, before trading around $77 [21] Group 9: GRAIL Inc. (GRAL) - GRAIL focuses on early cancer detection with its Galleri test, which is not yet FDA-approved [23] - The company expects to submit a PMA for the Galleri test in Q1 2026 [23] - The stock increased from $48.50 on September 26, 2025, to a high of $115.76 on November 25, 2025, before trading around $88 [24] Group 10: Cogent Biosciences Inc. (COGT) - Cogent is developing precision therapies for genetically defined diseases, with Bezuclastinib being its lead candidate [25] - The company submitted its first NDA to the FDA for Non-AdvSM, with additional submissions planned for GIST and advanced systemic mastocytosis [26] - The stock rose from $7.25 on July 2, 2025, to a 52-week high of $43.73 on December 8, 2025, before easing back to around $35 [26] Group 11: Sol-Gel Technologies Ltd. (SLGL) - Sol-Gel has two FDA-approved products for dermatological conditions and is developing investigational products [27] - A phase III trial for SGT-610 is ongoing, with results expected in Q4 2026 [28] - The stock rose from $7.26 on May 7, 2025, to a high of $52.26 on October 6, 2025, before trading around $43 [28] Group 12: Zenas BioPharma Inc. (ZBIO) - Zenas is focused on therapies for autoimmune diseases, with Obexelimab in phase 3 trials for IgG4-RD [29] - Positive data from a phase 2 trial in multiple sclerosis showed a 95% reduction in new lesions [30] - The stock rose from $8.79 on December 17, 2024, to a high of $44.60 on December 24, 2025, before pulling back to around $35 [31]

Core Insights - Orelabrutinib is the first BTK inhibitor to show significant clinical activity in a Phase 2 clinical trial for Systemic Lupus Erythematosus (SLE) [1] - Zenas BioPharma has acquired exclusive rights to develop, manufacture, and commercialize orelabrutinib for Multiple Sclerosis (MS) globally, and for non-oncology fields outside Greater China and Southeast Asia [1][5] Clinical Trial Results - In the Phase 2b study, 187 patients were randomized into three groups: orelabrutinib 75 mg once-daily, orelabrutinib 50 mg once-daily, and placebo [2] - The primary endpoint, SLE Response Index-4 (SRI-4) response rate at week 48, was met with the 75 mg group showing a response rate of 57.1% compared to 34.4% for placebo (p < 0.05) [2] - Secondary endpoints, including SRI-6 and British Isles Lupus Assessment Group-based Composite Lupus Assessment (BICLA) response rates, were also significantly higher in the 75 mg group compared to placebo (p < 0.05) [3] Safety and Tolerability - Orelabrutinib was well tolerated, exhibiting a safety profile consistent with BTK inhibition and the disease biology of SLE [3] Development Pipeline - Zenas is advancing orelabrutinib into a Phase 3 trial for Primary Progressive MS (PPMS) and plans to initiate a Phase 3 trial for Secondary Progressive MS (SPMS) in Q1 2026 [6] - Orelabrutinib is already approved for B cell malignancies in mainland China and Singapore, marketed by InnoCare [6] Company Overview - Zenas BioPharma is a clinical-stage global biopharmaceutical company focused on developing transformative therapies for autoimmune diseases [7] - The company is advancing two late-stage molecules: obexelimab and orelabrutinib, with obexelimab being a bifunctional monoclonal antibody targeting CD19 and FcγRIIb [7][8]

Meridian Funds, managed by ArrowMark Partners, released its third-quarter 2025 investor letter for the “Meridian Small Cap Growth Fund.” A copy of the letter can be downloaded here. Driven by continued gains in technology and falling bond yields, equities reached record highs in the quarter. U.S. small caps outperformed in the quarter, gaining 12.4%, while large caps returned 5.3%. Among small caps, value stocks slightly surpassed growth stocks, returning 12.6% and 12.2%, respectively, according to Russell ...

Core Insights - The company, Innovent Biologics, has announced that it will achieve breakeven in 2025, two years ahead of schedule, driven by strong commercialization performance and strategic licensing deals [1][3][10] Financial Performance - For the first three quarters of 2025, the company reported total revenue of 1.12 billion yuan, a year-on-year increase of 59.8% [2] - Revenue from the key BTK inhibitor, Oubatinib, rose by 45.8% year-on-year to 1.01 billion yuan, surpassing the total revenue of the previous year [2] - The company's loss for the first three quarters narrowed significantly by 74.8% to 70 million yuan, attributed to strong revenue growth and strict cost management [3] Strategic Initiatives - The company has successfully executed a significant licensing deal worth over $2 billion, aimed at accelerating the internationalization of Oubatinib [4][5] - The management has raised the full-year sales guidance to at least a 40% year-on-year increase based on the strong performance in the first three quarters [2] Research and Development - The company has over 10 research pipelines, with several in Phase III clinical trials, which will benefit from the strong cash flow generated by its operations [1][3] - In addition to Oubatinib, the company has developed multiple research barriers, including a new generation BCL2 inhibitor, Mesutoclax, which has shown an 84.0% overall response rate in difficult-to-treat patients [7][8] Market Positioning - The company is positioning itself for global expansion, leveraging partnerships to enhance its market presence and profitability [4][5] - The collaboration with Zenas, a U.S.-based biotech, is expected to create synergies in the treatment of multiple sclerosis, targeting a market worth nearly $30 billion [6][8] Future Outlook - The company aims to enter a rapid development phase, with plans to push five to six innovative drugs for approval and three to four products for global markets [9][10] - The strategic focus has shifted from a single product explosion to a multi-driver approach, indicating a robust pipeline and potential for market revaluation [10]

Financial Data and Key Metrics Changes - The company reported an 11% growth in both portfolio receipts and royalty receipts, reflecting strong business momentum [4][20] - Return on invested capital was 15.7% and return on invested equity was 22.9% for the last 12 months [5][23] - Portfolio receipts for the third quarter reached $814 million, with a projected full-year guidance increase to between $3.2 billion and $3.25 billion, representing growth of approximately 14-16% [25][28] Business Line Data and Key Metrics Changes - The company actively engaged in royalty transactions, deploying $1 billion in the quarter, totaling $1.7 billion for the first nine months [5][24] - Key drivers of growth included strong performance from Voranigo, Tremfya, and the Cystic Fibrosis Franchise [20] Market Data and Key Metrics Changes - The company expanded its development stage pipeline to 17 therapies, with significant potential for cumulative peak sales exceeding $36 billion [14][18] - The company noted a growing market for synthetic royalties, with $1.8 billion in synthetic royalty transactions announced in 2025, surpassing previous years [15][16] Company Strategy and Development Direction - The company aims to be a premier capital allocator in life sciences, focusing on innovative therapies with high patient impact [4][13] - The strategy includes a therapy area agnostic investment approach, allowing for diversification across various disease areas [9][16] - The company raised its full-year guidance for 2025, reflecting confidence in its diversified portfolio and ongoing capital deployment [25][28] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism regarding the uptick in biotech M&A activity, viewing it as beneficial for capital needs in the sector [34][37] - The company is excited about growth opportunities in China, particularly in out-licensing to multinationals [38] - Management emphasized a disciplined approach to capital allocation, focusing on transactions that align with their investment criteria [40][46] Other Important Information - The company repurchased 4 million shares in the quarter, totaling $1.15 billion in share repurchases for the first nine months [5][24] - The company maintains a strong financial position with cash and equivalents of $939 million and access to $2.9 billion in financial capacity [23][24] Q&A Session Summary Question: Impact of biotech M&A and interest rates on royalty-driven deal activity - Management noted that increased M&A activity does not significantly impact their operations, as large pharma companies require capital, which the company provides [34][37] Question: Updates on China strategy - Management highlighted ongoing efforts to build relationships in China, viewing it as a growth opportunity in the royalty marketplace [38] Question: Frequency of collaborations with large pharma - Management indicated that the use of royalties to fund trials is becoming mainstream, presenting a significant opportunity for the company [40][41] Question: Potential changes in risk appetite due to new launches - Management stated that while returns may fluctuate, their investment behavior remains consistent, focusing on attractive transactions regardless of market conditions [46][47] Question: Insights on the Amvuttra deal and competition - Management expressed confidence in the Amvuttra investment, highlighting a unique structure that allows for long-term royalty ownership [60][62] Question: Implications of trial outcomes for LP(a) products - Management remains optimistic about the probability of success for their LP(a) investments, despite potential challenges in trial outcomes [64][66] Question: Updates on obexelimab and market potential - Management noted that recent positive data for obexelimab validates its potential in treating autoimmune diseases, with a focus on IgG4-related disease [75][76]

Financial Data and Key Metrics Changes - The company reported an 11% growth in both portfolio receipts and royalty receipts, indicating strong business momentum [4][20] - Return on invested capital was 15.7% and return on invested equity was 22.9% for the last 12 months [5][23] - Portfolio receipts for the third quarter reached $814 million, reflecting an 11% increase [20] - Full year 2025 top line guidance was raised to between $3.2 billion and $3.25 billion, representing growth of approximately 14%-16% [8][25] Business Line Data and Key Metrics Changes - The company maintained strong returns with significant contributions from Voranigo, Tremfya, and the Cystic Fibrosis Franchise [20] - The development stage pipeline expanded to 17 therapies, with multiple pivotal readouts expected in the near future [7][14] Market Data and Key Metrics Changes - The company is actively participating in the growing market for royalties, with recent acquisitions including a royalty interest in Amgen's Imdelltra and Alnylam's AMVUTTRA [6][10] - The company has seen a significant uptick in deal activity, with a total of approximately $1.6 billion in announced value across three different disease areas [9] Company Strategy and Development Direction - The company aims to be the premier capital allocator in life sciences, focusing on innovative therapies with high patient impact [4][13] - The strategy includes a therapy area agnostic investment approach, allowing the company to invest across various disease areas [15][16] - The company is committed to creating value for shareholders through investments in innovative therapies [13][30] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the external environment, noting that increased biotech M&A activity could benefit their capital allocation strategy [38] - The company is excited about growth opportunities in China, particularly in out-licensing deals with multinationals [39] - Management emphasized the stability and consistency of their return metrics, indicating confidence in maintaining attractive returns [48][23] Other Important Information - The company has returned a record $1.5 billion to shareholders in the first nine months of the year, including share repurchases and dividends [24][25] - The company maintains financial flexibility with cash and equivalents of $939 million and access to a $1.8 billion revolver [23][24] Q&A Session Summary Question: Impact of biotech M&A and interest rates on royalty-driven deal activity - Management noted that increased M&A activity does not significantly impact their operations and that they see it as beneficial for capital needs in the sector [38][39] Question: Frequency of collaborations with large pharma - Management indicated that as the largest royalty buyer, they are actively looking at all deals and see a growing opportunity for using royalties to fund trials with both biotech and big pharma [41][42] Question: Insights on AMVUTTRA deal and competition - Management highlighted their confidence in AMVUTTRA's potential despite competition from Nucresiran, emphasizing their thorough analysis of various scenarios [51][55] Question: Implications of trial designs in the LP(a) space - Management acknowledged differences in trial designs and expressed optimism about both Amgen's and Novartis's trials, maintaining a positive outlook on their investments in this area [67][75] Question: Updates on obexelimab and its market potential - Management confirmed that the recent phase II data for obexelimab validated their investment thesis and highlighted the focus on IgG4-related disease for near-term capital needs [77][76]

Financial Data and Key Metrics Changes - The company reported an 11% growth in both portfolio receipts and royalty receipts, indicating strong business momentum [4][22] - Return on invested capital was 15.7% and return on invested equity was 22.9% for the last 12 months [6][25] - Portfolio receipts for Q3 2025 reached $814 million, reflecting an 11% increase [22] Business Line Data and Key Metrics Changes - The company maintained strong growth driven by key products such as Voranigo, Tremfya, and the Cystic Fibrosis Franchise [22] - The development stage pipeline expanded to 17 therapies, with multiple pivotal readouts expected in the near future [7][15] Market Data and Key Metrics Changes - The company raised its full-year 2025 top line guidance to between $3.2 billion and $3.25 billion, representing growth of approximately 14-16% [9][20] - Milestones and other contractual receipts are now expected to be around $125 million, up from $110 million previously [20] Company Strategy and Development Direction - The company aims to be the premier capital allocator in life sciences, focusing on innovative therapies with high patient impact [4][31] - The strategy includes a therapy area agnostic investment approach, allowing for diversification across various disease areas [10][17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ongoing demand for funding life sciences innovation, highlighting the potential for annualized total shareholder returns in the mid-teens over the next five years [31] - The company is excited about growth opportunities in China, particularly in out-licensing to multinationals [39] Other Important Information - The company deployed $1 billion in capital for value-creating royalty transactions in Q3 2025, totaling $1.7 billion for the first nine months [6][26] - Share repurchases amounted to $1.15 billion in the first nine months of 2025 [26] Q&A Session Summary Question: Impact of biotech M&A and interest rates on royalty-driven deal activity - Management noted that the uptick in M&A activity does not significantly impact their operations, as large pharma companies require capital, which the company provides [38] Question: Thoughts on the China opportunity - Management is optimistic about growth in China and is actively building relationships to capitalize on this market [39] Question: Frequency of collaborations with large pharma - Management believes the use of royalties to fund trials is becoming mainstream, indicating a growing opportunity in this area [41] Question: Insights on the Amvuttra deal and competition - Management expressed confidence in the Amvuttra investment despite potential competition from Nucresiran, citing a broad range of scenarios considered [60] Question: Updates on the LP(a) space and trial designs - Management acknowledged differences in trial designs and remains optimistic about the prospects of their investments in this area [90] Question: Updates on obexelimab and its market potential - Management highlighted the strong phase 2 data for obexelimab, validating its potential in treating autoimmune diseases [92]

Core Viewpoint - Zenas BioPharma's Obexelimab has shown significant efficacy in treating relapsing multiple sclerosis (RMS) in the Phase 2 MoonStone trial, achieving a 95% reduction in new gadolinium-enhanced (GdE) T1 lesions compared to placebo, indicating a strong potential for this therapy in autoimmune diseases [1][3][9]. Group 1: Clinical Trial Results - The MoonStone trial demonstrated a statistically significant primary endpoint, with Obexelimab reducing the accumulation of new GdE T1 lesions by 95% (p=0.0009) compared to placebo [1][3]. - In the Obexelimab treatment group, near-complete suppression of new GdE T1 lesions was observed at 8 weeks, which continued to 12 weeks [3][12]. - The average number of new GdE T1 lesions in the Obexelimab group was 0.01, while the placebo group had 0.23, highlighting the treatment's effectiveness [9]. Group 2: Mechanism and Development - Obexelimab is a bifunctional antibody targeting CD19 and FcγRIIb, designed to inhibit B cell activity without causing B cell depletion, making it a promising candidate for various autoimmune diseases [3][4]. - The drug's unique mechanism, combined with its subcutaneous self-administration and tolerability, positions it as a potential option for addressing B cell-mediated pathologies in autoimmune diseases [16]. Group 3: Future Milestones and Collaborations - Zenas BioPharma is expected to report 24-week data from the MoonStone trial in Q1 2026, which will include additional secondary and exploratory endpoints [16]. - The company anticipates announcing the final results of the Phase 3 INDIGO trial for IgG4-related disease by the end of 2025 and the Phase 2 SunStone trial for systemic lupus erythematosus (SLE) in mid-2026 [16]. - Zenas has entered a collaboration agreement with Bristol Myers Squibb for Obexelimab's rights in several Asia-Pacific regions, enhancing its market reach [5][17].

Core Viewpoint - InnoCare Pharma Inc., a wholly-owned subsidiary of Innovent Biologics, has signed a licensing agreement with Zenas BioPharma, granting Zenas rights to develop, produce, and commercialize the drug Orelabrutinib and two preclinical assets, with total payments exceeding $2 billion [1][2][4]. Group 1: Licensing Agreement Details - The agreement includes global exclusive rights for Orelabrutinib in multiple sclerosis (MS) and other non-MS indications outside Greater China and Southeast Asia, as well as exclusive rights for a preclinical IL-17 inhibitor and a preclinical oral TYK2 inhibitor [2][3]. - Zenas will pay an upfront fee of $100 million, milestone payments, and grant 7 million common shares to Innovent, with total potential payments exceeding $2 billion [2][4]. Group 2: Strategic Importance - This licensing deal marks the second business development (BD) initiative for Innovent in 2023, emphasizing the company's focus on international expansion and product commercialization over the next three years [1][7]. - The management has indicated that BD will be a priority, aiming to accelerate the global development and commercialization of Orelabrutinib and other pipeline products [4][7]. Group 3: Market Reaction - Following the announcement, Innovent's stock price fell by 6.24% on October 9 and continued to decline by 9.16% on October 10, indicating market skepticism regarding the licensing of non-core indications for Orelabrutinib [3][4]. Group 4: Previous Collaborations - Innovent has a history of international collaborations, including a previous agreement with BeiGene for Orelabrutinib, which was terminated in June 2023, but the company remains committed to exploring the drug's potential in various B-cell lymphomas [5][6][7].

Core Viewpoint - The recent licensing agreement between Nuo Cheng Jian Hua and Zenas has led to a significant market reaction, with Nuo Cheng Jian Hua's stock dropping while Zenas's stock surged, indicating a divergence in market sentiment regarding the deal's value and potential [1][2]. Summary by Sections Licensing Agreement Details - Nuo Cheng Jian Hua has licensed its BTK inhibitor, Oubutini, for multiple sclerosis and other autoimmune diseases to Zenas, receiving an upfront payment of $100 million, milestone payments, and 7 million shares of Zenas stock, with a total potential deal value exceeding $2 billion [1][2]. - The upfront payment and stock value combined amount to $280 million, which is considered reasonable compared to industry standards, where the average upfront payment ratio is around 8% [3]. Market Reaction and Sentiment - The market's cautious sentiment towards the deal stems from two main concerns: the upfront payment not meeting expectations and the perceived lack of recognition of Zenas as a partner [2][5]. - Nuo Cheng Jian Hua's stock fell by 6.24% in A-shares and 11.64% in Hong Kong shares, while Zenas's stock rose by 24.22% following the announcement [1]. Strategic Considerations - Nuo Cheng Jian Hua had previously engaged with multinational corporations (MNCs) but ultimately chose Zenas due to smoother communication and Zenas's strong clinical development capabilities, particularly in the field of multiple sclerosis [5][10]. - Zenas, founded in 2019 and listed on NASDAQ in 2024, currently has no commercial products but has a promising pipeline, including a dual-function monoclonal antibody that complements Oubutini [7][8]. Industry Context - The collaboration reflects a shift in the global innovation drug landscape from one-time licensing deals to deeper collaborative models, where local pharmaceutical companies can retain equity in new ventures [12]. - Nuo Cheng Jian Hua's previous partnership with Biogen ended after about 18 months, highlighting the challenges in securing long-term collaborations in the industry [11]. Future Outlook - The partnership aims to advance the development of Oubutini in treating primary and secondary progressive multiple sclerosis, with significant market opportunities projected in the U.S. alone [8]. - The success of this collaboration will depend on Zenas's ability to progress its pipeline and the overall market performance of its shares [12].