HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Equity Capital Markets

<ul>
<li>TY-9591 has differentiated indication compared with the current listed third-generation EGFR-TKI, but it still depends on the final clinical results, which also bring more uncertainty to the commercialization performance.</li>
<li>TYK’s development strategy requires it to invest heavily on head-to-head trials.Due to cash shortage, until TYK successfully addresses survival pressure,we recommend a more cautious assessment of pipeline prospects/future R&amp;D arrangements.</li>
<li>TYK is a “mediocre” company. The valuation (RMB3.08 billion) is based on optimistic expectations that core product will be successfully developed, become Me-Better, and commercialized smoothly.We’re, however, conservative about this.</li>
</ul>


TY-9591 has differentiated indication compared with the current listed third-generation EGFR-TKI, but it still depends on the final clinical results, which also bring more uncertainty to the commercialization performance.
TYK’s development strategy requires it to invest heavily on head-to-head trials.Due to cash shortage, until TYK successfully addresses survival pressure,we recommend a more cautious assessment of pipeline prospects/future R&amp;D arrangements.
TYK is a “mediocre” company. The valuation (RMB3.08 billion) is based on optimistic expectations that core product will be successfully developed, become Me-Better, and commercialized smoothly.We’re, however, conservative about this.


Pre-IPO TYK Medicines (PHIP Updates) - Some Points Worth the Attention

<ul>
<li>Sunho’s pipeline has high risk and there is a long way to go to demonstrate their final clinical value. It’s highly uncertain if Sunho would bring expected return to investors.</li>
<li>The entities involved in the process of reorganization were all related parties. Investment from Efung Anhe/Efung Ansheng sparked concern from CSRC. Sunho is required to explain whether there’s any benefit transfer.</li>
<li>Due to the lack of strong fundamentals, there is no reason for high valuation. It’s not surprising if Sunho’s valuation finally falls below HKD1.53 billion (or even below HK$1 billion).  </li>
</ul>


Sunho’s pipeline has high risk and there is a long way to go to demonstrate their final clinical value. It’s highly uncertain if Sunho would bring expected return to investors.
The entities involved in the process of reorganization were all related parties. Investment from Efung Anhe/Efung Ansheng sparked concern from CSRC. Sunho is required to explain whether there’s any benefit transfer.
Due to the lack of strong fundamentals, there is no reason for high valuation. It’s not surprising if Sunho’s valuation finally falls below HKD1.53 billion (or even below HK$1 billion).  


Pre-IPO Sunho Biologics (PHIP Updates) - Some Points Worth the Attention

Asia Pac ECM and Index Rebal, Shenton Research

Ke Yan, CFA, FRM

Asia Pac ECM and Index Rebal

Asia Pac IPO & Placement Research, China Biotech

DZT Research

DZT Research is an independent Asia Pacific equity specialist. Our quantitative research covers index rebalancing flows, alongside exchange data analytics accross Asia Pacific. On the equity capital markets side, we focus on Asia Pacific ECM, especially biotech and TMT. Our lead analyst is frequently cited by international media.

<ul>
<li>Sunho Biologics, a China-based clinical-stage biotechnology company, plans to raise up to US$100m via a Hong Kong listing.</li>
<li>In this note, we examine the company's three core products, namely IAP0971, IAE0972, and IAH0968, which target malignancies.</li>
<li>A large part of the company's pipeline is testing the unproven targets. We also think the management and pre-IPO investors are of mediocre quality.</li>
</ul>


Sunho Biologics, a China-based clinical-stage biotechnology company, plans to raise up to US$100m via a Hong Kong listing.
In this note, we examine the company's three core products, namely IAP0971, IAE0972, and IAH0968, which target malignancies.
A large part of the company's pipeline is testing the unproven targets. We also think the management and pre-IPO investors are of mediocre quality.


Sunho Biologics (盛禾) Pre-IPO: Testing the Unproven Targets

<ul>
<li>There is a certain connection between Sunho and Genscript. So, Sunho has a typical style of "CXO switching to biotech" – That is to do whatever is popular.</li>
<li>For core products, IAP0971 and IAE0972 just completed phase I trials, still with high R&amp;D failure risks. IAH0968 is difficult to become a blockbuster variety due to strong competing products.</li>
<li>As investors’re already rational about investing in unprofitable Biotech. The companies without commercialized products and with uncertain outlook may not be favored by the market. Therefore, high valuation is unreasonable.</li>
</ul>


There is a certain connection between Sunho and Genscript. So, Sunho has a typical style of "CXO switching to biotech" – That is to do whatever is popular.
For core products, IAP0971 and IAE0972 just completed phase I trials, still with high R&amp;D failure risks. IAH0968 is difficult to become a blockbuster variety due to strong competing products.
As investors’re already rational about investing in unprofitable Biotech. The companies without commercialized products and with uncertain outlook may not be favored by the market. Therefore, high valuation is unreasonable.


Pre-IPO Sunho Biologics (SHB HK) - High Valuations Can Be Hard to Come By

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Sunho Biologics (SHB HK)

Pre-IPO TYK Medicines (PHIP Updates) - Some Points Worth the Attention

TYK has differentiated indication for core product, but it faces uncertainty in R&D. Cash shortage is an issue. We recommend a more cautious...

Xinyao (Criss) Wang

Pre-IPO Sunho Biologics (PHIP Updates) - Some Points Worth the Attention

Sunho's high-risk pipeline makes future return highly uncertain. Reorganization with related parties and "sudden" capital increase raised concern...

Xinyao (Criss) Wang

Sunho Biologics (盛禾) Pre-IPO: Testing the Unproven Targets

We examine the fundamentals of Sunho Biologics for its IPO. We are not positive on the success of its product pipeline and are not impressed with...

Ke Yan, CFA, FRM

Pre-IPO Sunho Biologics (SHB HK) - High Valuations Can Be Hard to Come By

Sunho does not have any drugs at NDA/BLA stage or commercialized products. Its outlook is highly uncertain due to challenging clinical trials...

Xinyao (Criss) Wang

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Pre-IPO TYK Medicines (PHIP Updates) - Some Points Worth the Attention

​TYK has differentiated indication for core product, but it faces uncertainty in R&D. Cash shortage is an issue. We recommend a more cautious...

Xinyao (Criss) Wang

Pre-IPO Sunho Biologics (PHIP Updates) - Some Points Worth the Attention

​Sunho's high-risk pipeline makes future return highly uncertain. Reorganization with related parties and "sudden" capital increase raised concern...

Xinyao (Criss) Wang

Sunho Biologics (盛禾) Pre-IPO: Testing the Unproven Targets

We examine the fundamentals of Sunho Biologics for its IPO. We are not positive on the success of its product pipeline and are not impressed with...

Ke Yan, CFA, FRM

Pre-IPO Sunho Biologics (SHB HK) - High Valuations Can Be Hard to Come By

Sunho does not have any drugs at NDA/BLA stage or commercialized products. Its outlook is highly uncertain due to challenging clinical trials...

Xinyao (Criss) Wang

TYK has differentiated indication for core product, but it faces uncertainty in R&D. Cash shortage is an issue. We recommend a more cautious...

Sunho's high-risk pipeline makes future return highly uncertain. Reorganization with related parties and "sudden" capital increase raised concern...