Core Insights - HUTCHMED will present new and updated data from several studies at the ESMO Congress 2025, scheduled for October 17-21, 2025, in Berlin, Germany [1][2] Group 1: Study Presentations - Results from the FRUSICA-2 study on the combination of fruquintinib and sintilimab for second-line treatment of advanced renal cell carcinoma will be presented in a Mini Oral session [2] - Additional analyses from the FRUSICA-1 study in endometrial cancer and the SACHI and SAVANNAH studies in non-small cell lung cancer will be showcased during poster sessions [2] - Specific presentations include a phase 3 study comparing fruquintinib plus sintilimab against axitinib or everolimus for renal cell carcinoma [2] Group 2: Drug Information - Fruquintinib is a selective oral inhibitor of VEGFRs and is co-developed by HUTCHMED and Eli Lilly, marketed as ELUNATE® in China [4] - Savolitinib is a selective MET tyrosine kinase inhibitor developed by AstraZeneca and HUTCHMED, commercialized as ORPATHYS® [5] - Surufatinib is an oral angio-immuno kinase inhibitor marketed in China as SULANDA® and retains all rights with HUTCHMED [8]

Summary of Innovent Biologics (1801.HK) Earnings Review and Key Insights Company Overview - **Company**: Innovent Biologics - **Ticker**: 1801.HK - **Industry**: Biopharmaceuticals, focusing on immuno-oncology and other therapeutic areas Key Financial Highlights - **1H25 Revenues**: Rmb5.95 billion, representing a **51% year-over-year increase** [1] - **Product Sales**: Rmb5.2 billion, up **37% year-over-year** [1] - **License Income**: Rmb666 million, primarily from a US$80 million upfront payment from the DLL3 ADC deal with Roche [1] - **Net Profit**: Rmb834 million, a significant improvement from Rmb-393 million in 1H24 [1] - **Gross Profit Margin (GPM)**: 86.0%, with product GPM at 84.1%, reflecting a **185 basis points year-over-year increase** [1] - **R&D Spending**: Rmb1 billion, down **28% year-over-year** [1] - **SG&A Spending**: Rmb3.37 billion, up **29% year-over-year** [1] - **Non-IFRS EBITDA**: Rmb1.4 billion, with expectations for better bottom-line performance in FY25 [1] Product Development and Clinical Trials - **IBI363 Development**: Progressing into global phase 3 trials, targeting IO-resistant squamous NSCLC, with IND clearance from the FDA [2] - **Trial Design**: Includes randomized controlled groups and aims for overall survival (OS) as the primary endpoint [2] - **Additional Trials**: Plans for further phase 3 trials in other indications, including MSS CRC and broader exploration in NSCLC [6] Market Strategy and Product Launch - **Mazdutide Launch**: Launched in late June with a multi-channel marketing strategy, focusing on weight management and metabolic benefits [7] - **Initial Market Feedback**: Positive user feedback and sales ramp-up observed [7] - **New Trials for Mazdutide**: Two new phase 3 trials initiated for MAFLD and OSA indications [7] Valuation and Price Target - **Updated Price Target**: HK$103.22, increased from HK$98.23 [8] - **EPS Estimates**: Adjusted for 2025-2027 from Rmb0.43/Rmb2.79/Rmb2.69 to Rmb0.54/Rmb2.73/Rmb2.62 [8] - **Market Cap**: HK$147.6 billion [12] Risks and Challenges - **Competitive Landscape**: Intensifying competition in the PD-1/L1 market in China [8][11] - **Approval Timelines**: Uncertain timelines for key candidates [8][11] - **Regulatory Risks**: Potential restrictions on off-label use due to safety issues [8][11] - **R&D Project Failures**: Risks associated with the failure of ongoing R&D projects [8][11] Conclusion Innovent Biologics is positioned for growth with strong financial performance and a robust pipeline of products. The company is actively advancing its clinical trials and expanding its market presence, particularly with the launch of mazdutide. However, it faces significant competition and regulatory challenges that could impact its future performance.

Summary of Innovent Biologics Conference Call Company Overview - **Company**: Innovent Biologics (1801.HK) - **Industry**: Biopharmaceuticals, focusing on immuno-oncology and metabolic diseases Key Financial Performance - **2Q25 Product Revenue**: Exceeded Rmb2.7 billion, representing a **35% year-over-year increase** and a **13% quarter-over-quarter increase** from Rmb2.4 billion in 1Q25 [1] - **Tyvyt Sales**: Reported at US$137 million in 2Q25, a **19% year-over-year increase**, but largely flat compared to previous quarters [1] - **New Product Launches**: Five new products launched in 2025, contributing to a **186% year-over-year increase** in sales from the new product portfolio, excluding Tyvyt and biosimilars [1] Market Position and Strategy - **Mazdutide**: Recently approved and launched, positioned favorably in the obesity market, especially amid NOVO's destocking in China [2] - **Pricing Advantage**: Mazdutide priced at approximately Rmb2,920 per month, offering a discount compared to competitors like Zepbound [2] - **Sales Growth Drivers**: Continued momentum expected in 1H25, driven by strong uptake in tafolecimab post NRDL inclusion and the anticipated sales uptake of mazdutide [1][2] Competitive Landscape - **NOVO's Ozempic Sales**: Experienced a **37% year-over-year decline** in 2Q25 due to destocking, creating an opportunity for mazdutide to capture market share [2] - **Market Dynamics**: The obesity market in China is seen as expanding due to limited competition and NOVO's passive strategy, which benefits Innovent's proactive promotion of mazdutide [2] Financial Projections and Valuation - **2025 Revenue Forecast**: Full-year product sales projected at Rmb11.7 billion, a **42% year-over-year increase** [1] - **Target Price**: Updated DCF-based 12-month target price set at HK$98.23, reflecting a **7.5% upside** from the current price of HK$91.40 [7][15] - **Earnings Estimates**: Adjusted EPS estimates for 2025-2027 reflect slight downward revisions due to near-term sales growth adjustments [7] Risks and Considerations - **Key Risks**: 1. Intensifying competition in the PD-1/L1 market in China [7][13] 2. Uncertain approval timelines for key candidates [7][13] 3. Potential restrictions on off-label use due to safety issues [7][13] 4. Risks associated with R&D project failures [7][13] Conclusion - Innovent Biologics is positioned to leverage its strong product pipeline and market dynamics to drive growth, particularly with the launch of mazdutide. The company is viewed as undervalued relative to its potential, with a favorable outlook for continued revenue growth in the coming years.

Investment Rating - The report maintains a "Buy" rating for several healthcare stocks, including Wuxi Apptec and Eyebright, based on their strong growth potential and market positioning [11]. Core Insights - The EU's planned restrictions on Chinese medtech firms' access to public procurements over EUR 5 million are expected to have limited impact on the covered companies, as most do not participate in such procurements and have manageable revenue exposure to the EU market [3]. - The healthcare indices in China showed positive performance, with HSHCI rising by 4.1% and HSHKBIO by 4.5% during the week of June 2-6, 2025, indicating a favorable market trend [2]. - Recent approvals in the drug sector include Akeso's cadonilimab for cervical cancer and Hansoh's aumolertinib for NSCLC in the UK, showcasing ongoing innovation and regulatory progress in the industry [4][5]. Summary by Sections Market Access and Regulatory Environment - The EU's International Procurement Instrument investigation concluded that China has limited EU medical device producers' access to government contracts, leading to the proposed restrictions [3]. - Companies like Mindray and MGI Tech have established local manufacturing facilities, which may help mitigate the impact of these restrictions [3]. Drug Approvals and Developments - Akeso's cadonilimab received approval for treating first-line cervical cancer, while Innovent and Hutchmed's sintilimab + fruquintinib application was accepted for renal cell carcinoma [4]. - Hansoh's aumolertinib has been approved in the UK for specific NSCLC patients, indicating a strong pipeline for innovative therapies [4]. Stock Performance and Recommendations - The report highlights top picks in the healthcare sector, including Wuxi Apptec and Eyebright, based on their expected solid fundamental recovery and market share potential [11]. - The report notes that the chemicals sector outperformed healthcare indices, with a 1.7% increase in A shares and a 3.8% increase in H shares [12].

Investment Rating - The report assigns a "Buy" rating to Innovent Biologics with a revised 12-month price target of HK$74.95, reflecting an upside potential of 15.2% from the current price of HK$65.05 [15][9]. Core Insights - Innovent Biologics has shown encouraging survival benefits for its drug IBI363 in various cancer indications, particularly in IO-treated squamous and adeno NSCLC, with improved overall response rate (ORR) and progression-free survival (PFS) data compared to previous reports [1][2][12]. - The risk-adjusted sales forecast for IBI363 has been raised to US$3.2 billion by 2035, up from US$1.4 billion, due to the addition of 2L adeno NSCLC and an increase in the probability of success (POS) for other indications [1][9]. - The report highlights the importance of randomized controlled trials (RCT) to further validate the long-term benefits of IBI363, especially in the context of its mechanism of action that enhances the immune environment [7][12]. Summary by Sections Clinical Data - The updated phase 1 data for IBI363 indicates a median PFS of 9.3 months for the high-dose cohort, an increase from 7.3 months previously reported, and a median overall survival (mOS) of 15.3 months, suggesting a strong conversion from PFS to OS [2][7]. - In adeno NSCLC, the median PFS was shorter at 5.6 months, but the overall survival data remains competitive, indicating potential lasting benefits post-disease progression [3][7]. Market Position and Valuation - Innovent Biologics is positioned as a leading biopharma company in China with a robust pipeline of over 30 assets, including the leading PD-1 inhibitor sintilimab [12]. - The report emphasizes that Innovent is undervalued at current levels, with a high market-implied weighted average cost of capital (WACC) that does not fully reflect its strong revenue potential and pipeline [12]. Future Outlook - The ongoing phase 1b/2 trial for IBI363 in combination with chemotherapy in the first-line setting is expected to generate further discussions regarding its competitive safety profile and efficacy [8][12]. - The report anticipates that the company will maintain its leading position in the biotech sector in China, supported by strong commercialization capabilities and collaborations with global partners [12].

Core Viewpoint - Innovent Biologics and HUTCHMED announced the acceptance of a New Drug Application (NDA) for the combination of sintilimab and fruquintinib for treating locally advanced or metastatic renal cell carcinoma (RCC) patients who have failed prior treatment with one tyrosine kinase inhibitor (TKI) [1][2][3] Company Overview - Innovent Biologics is a biopharmaceutical company focused on developing high-quality medicines for major diseases, including oncology, and has launched 15 products in the market [14] - HUTCHMED is committed to discovering and commercializing targeted therapies and immunotherapies for cancer and immunological diseases, with its first three medicines marketed in China [17] Product Details - Sintilimab, marketed as TYVYT®, is a PD-1 inhibitor that has received approval for multiple indications in China, including its recent NDA for advanced RCC [5][6] - Fruquintinib is a selective oral inhibitor of VEGFRs, co-developed by HUTCHMED and Eli Lilly, and is approved for treating metastatic colorectal cancer in China [7][9] Clinical Study Insights - The NDA is supported by data from the FRUSICA-2 study, which demonstrated significant improvements in progression-free survival (PFS), objective response rate (ORR), and duration of response (DoR) for the combination therapy [2][3] - The FRUSICA-2 study met its primary endpoint, and the safety profile of the combination was found to be tolerable with no new safety signals [2][3] Market Context - In 2022, approximately 435,000 new kidney cancer cases were diagnosed globally, with around 74,000 cases in China, indicating a significant unmet medical need for effective treatments [4] - The combination therapy aims to address the challenges faced by RCC patients who have limited treatment options after failing first-line therapies [3][12]

Core Viewpoint - Innovent Biologics is set to present clinical data for its bispecific antibodies and ADC molecules at the ASCO Annual Meeting 2025, highlighting advancements in cancer treatment, particularly with IBI363 and IBI343 [1][2] Group 1: Clinical Presentations - IBI363 has three indications accepted for oral presentations: melanoma, colorectal cancer (CRC), and non-small cell lung cancer (NSCLC), showcasing the attention on PD-1-based immunotherapy [2] - The Phase 1b data of IBI343 in pancreatic cancer will also be presented, reinforcing its potential in a challenging therapeutic area [2] - The presentations are scheduled between May 30 and June 3, 2025, in Chicago, Illinois [1] Group 2: Presentation Details - IBI363's efficacy and safety results in advanced acral and mucosal melanoma will be presented on May 31, 2025 [3] - The efficacy and safety of IBI363 in advanced colorectal cancer will be discussed on June 1, 2025 [4] - IBI363's application in advanced immunotherapy-treated NSCLC will be presented on June 3, 2025 [4] Group 3: Company Overview - Innovent Biologics, founded in 2011, focuses on developing high-quality biopharmaceuticals for various diseases, including cancer [12] - The company has launched 15 products and has multiple assets in various stages of clinical trials, indicating a robust pipeline [12] - Innovent collaborates with over 30 global healthcare companies, enhancing its research and development capabilities [12]

Core Insights - The FRUSICA-2 Phase 2/3 clinical trial has successfully met its primary endpoint of progression-free survival (PFS) for the combination of sintilimab and fruquintinib in treating advanced renal cell carcinoma (RCC) in China [1][3] - The combination therapy has received conditional approval from China's National Medical Products Administration (NMPA) for advanced endometrial cancer, indicating its potential in multiple cancer types [2][11] - The study demonstrated improvements in secondary endpoints, including objective response rate (ORR) and duration of response (DoR), with full results expected to be presented at a scientific conference [3] Company Overview - Innovent Biologics, Inc. is a biopharmaceutical company focused on developing high-quality medicines for various diseases, including oncology, cardiovascular, and autoimmune conditions [1][18] - HUTCHMED (China) Limited is committed to the discovery and commercialization of targeted therapies and immunotherapies for cancer and immunological diseases [21][22] - Both companies are collaborating to advance the registrational communication of the sintilimab and fruquintinib combination therapy [4][5] Clinical Trial Details - The FRUSICA-2 study is a randomized, open-label trial comparing sintilimab and fruquintinib against axitinib or everolimus monotherapy for second-line treatment of advanced RCC [3][16] - The trial's positive results are seen as a significant advancement in treatment options for patients who have not responded adequately to previous therapies [4][5] Market Context - In 2022, approximately 435,000 new kidney cancer cases were diagnosed globally, with 74,000 in China, highlighting the substantial market potential for effective treatments [5] - The combination of sintilimab and fruquintinib addresses an unmet medical need for advanced RCC patients who have previously failed single-agent targeted therapies [16][17]