Daily Brief Health Care: Jinxin Fertility Co Ltd, Hisamitsu Pharmaceutical Co, Sartorius AG, Everest Medicines, WuXi XDC Cayman Inc, Respiri Ltd and more

• China has started taking measures to optimize fertility policies. The inclusion of assisted reproduction technologies in medical insurance is a general trend, which would generate increasing demand in the future.
• From the current domestic assisted reproductive industry chain, there is significant import substitution space and growth potential in the fields of related drugs, prenatal/newborn genetic testing, and downstream medical services.
• Companies such as Livzon/BGI/Jinxin would be the direct beneficiaries of related policy. We analyzed the industry characteristics, investment rationale, key risks and comparison with peers of these companies. 

• Hisamitsu Pharmaceutical Co (4530 JP) announced strong Q1FY24 result, with double-digit top-line and triple-digit bottom-line growth, driven by its largest selling OTC product, Salonpas. The company has reiterated FY24 guidance.
• In Q1FY24, Hisamitsu has launched Apohide Lotion in Japan for the treatment of primary palmar hyperhidrosis and Xelstrym transdermal system in the U.S. for the treatment of Attention-Deficit/Hyperactivity Disorder (ADHD).
• Hisamitsu has announced buyback of up to 2M of its shares (representing 2.57% of issued shares) from July 2023 to February 2024 for ¥10B.

• In this insight, we take a look at the names leading the race to become ADDs/DELs for the DAX, MDAX, and SDAX Indices in the September 2023 Rebalance.
• As things stand, I do not see any changes for the DAX index as-is, but there are couple of names requiring only small price gains to trigger Fast Entry changes.
• I see one change between MDAX and SDAX and one separate ADD/DEL for the SDAX index in the September 2023 rebalance.

• As the core candidate in Everest Medicines’s current pipeline, the peak sales of Nefecon could be significantly lower-than-expected, mainly due to low diagnostic rate, limited applicable patient population, high price, competition from latecomers.
• For the rest late-stage candidates, such as Etrasimod, Eravacycline, Taniborbactam, their peak sales would all be lower than that of Nefecon. So, they are unable to bring enough imagination space.
• Based on license-in mode, cost of Everest Medicines is higher than independent-R&D companies. Whether products would be returned to licensors again because of weak sales prospects is also uncertain factor.

• WuXi XDC Cayman Inc (1877628D HK) is looking to raise >US$100m in its upcoming Hong Kong IPO. The bookrunners on the deal are Morgan Stanley, Goldman Sachs, and JP Morgan.
• WuXi XDC Cayman (WXDC) is a contract research, development, and manufacturing organization (CRDMO) focused on the global antibody drug conjugates (ADC) and broader bioconjugate market providing integrated and end-to-end services.
• As per Frost & Sullivan (F&S), the firm was the second largest CRDMO for ADCs and other bioconjugates globally in terms of FY22 sales.

Respiri has announced a three-year distribution and marketing agreement (non-exclusive) with Fi-Med Management, a US-based company providing healthcare support and management solutions to large healthcare organisations. Under this revenue-share arrangement, Respiri will receive $30 per patient per month for active patients enrolled as wheezo RPM users. Although the initial Fi-Med customer review suggests an immediate opportunity to address 5,000 patients, the collaboration is anticipated to enable Respiri to access a wider patient base. The development closely aligns with management’s strategic focus to expand into other indications and generate incremental top-line growth.