Health Care Archives | Page 74 of 137 | Smartkarma

• This article discusses the potential inclusions and exclusions of KOSDAQ150 rebalance in December 2023 (especially those that are highlighted by the locals).
• The potential inclusion candidates include Lunit, Shinsung Delta Tech, and JNTC. The eight potential inclusion candidates are up on average 122% YTD, sharply outperforming KOSDAQ in the same period. 
• Stocks that are expected to be excluded in the KOSDAQ150 index include Aju IB Investment, HFR, Danal, and Sangsangin.

• Back in late 2020, Livzon Pharmaceutical Group (1513 HK) proposed spinning off 39.4%-held Livzon Diagnostics on Chinext. After numerous filings with the regulators … crickets.  
• Livzon has now proposed listing Livzon Diagnostics on the National Equities Exchange and Quotations with an intention of transitioning listed shares to the Beijing Stock Exchange (BSE).
• The CSRC recently introduced a raft of initiatives to spur investor interest in the BSE. After all-but-abandoning the prior listing, Livzon looks to be cashing in on this recent excitement. 

• Abrocitinib/Upadacitinib/Dupilumab will all exert great pressure on the future commercialization space of CM310 in China. If Keymed doesn’t run head-to-head trials with dupilumab, CM310’s internationalization outlook would be gloomy.
• Compared with IL-4 that has been almost occupied by dupilumab, Keymed has more opportunity on TSLP. Even with Keymed-AstraZeneca deal, our valuation of CMG901 is cautious based on our analysis. 
• The current valuation of Keymed is not cheap. The next big catalyst to share price is a new license-out deal with MNC on CM310/CM326, marking the beginning of qualitative changes. 

• Aspira Women’s Health reported 3Q23 financial results, mostly in line with our estimates.
• Revenue of $2.2 million was below our estimate, but good expense control is in place and is expected to continue.
• Our estimates for 2023 and 2024 remain in line with our prior estimates.

Basilea has bolstered its drug pipeline with the in-licensing of fosmanogepix, a broad-spectrum antifungal candidate, from Amplyx Pharmaceuticals (a Pfizer affiliate). Fosmanogepix is a clinical-stage, potentially first-in-class broad-spectrum antifungal treatment and Basilea plans to initiate Phase III trials in mid-2024. Deal consideration includes $37m in upfront payments and milestones of up to $496m ($110m to Pfizer, and $396m from previous agreements), of which the majority relates to regulatory and commercial milestone events, and tiered single-digit royalties. We view this as a favourable transaction for Basilea and note that it is in line with the company’s previously disclosed plans to expand its late-stage product pipeline. In our view, fosmanogepix represents a promising near-term commercial opportunity as the legacy portfolio matures, provided that the data continue to be supportive. As part of this new update, management has also provided revised full-year 2023 financial guidance. We will update our model and valuation to reflect this deal. Our 2023 and 2024 estimates are under review.

e-therapeutics reported H1 FY24 results (to end-July 2023), reaffirming its commitment to integrating its computational and hepatocyte biology expertise to develop short interfering RNA (siRNA) therapies. The key half-year development was the proof-of-concept (PoC) data for two preclinical assets for the treatment of cardiometabolic disease and haemophilia, with further updates forthcoming. We view these pipeline updates, especially in segments with increased interest, as positive. Management continues to strengthen its intellectual property (IP) position and has filed new patent applications to protect 11 inventions relating to its novel targets and siRNA constructs. In our view, the company’s cost-effective and flexible approach is a key differentiator, especially in light of the challenging funding environment for drug discovery. In H1 FY24, R&D spend was £5.3m, and the company expects an increase in H2 FY24 with further development of its AI capabilities and progression of its in-house preclinical pipeline. At end-July 2023, e therapeutics had a net cash position of £24.8m.

• In 1H23, biologics division of Lonza Group (LONN SW) reported revenue decline of 1% YoY to CHF1.6B, due to low mRNA sales dragged by lower demand for the COVID-19 vaccines.
• Reflecting slower-than-expected growth in early-stage services and continued weak demand for nutraceutical capsules, Lonza has reduced 2023 sales growth expectation and cut core EBITDA margin guidance to 28–29%.   
• Growth in 2024 will be impacted by high base, the subsequent mRNA revenue loss, and trial setback faced by small biotech client. Lonza anticipates 2024 margin in the high twenties.

• 30% female board member set by TSE isn’t surprising, as it’s level within reach, but the fact that TSE set explicit target that companies can’t excuses is a first step.
• To ensure that a female board member isn’t isolated from other board members, multiple female board members should be elected. In this sense, 30% female board members goal makes sense.
• In fact, the most interesting question is how many more companies will approach 50% after achieving a 30% of female board members.

• A weekly summary of key developments across ECM and Event-Driven names tracked by us across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Thailand, Korea, India and Chinese ADRs.
• ECM developments – EcoPro Materials (ECO123 KS), WuXi XDC Cayman (1877628D HK), Midea Group Co Ltd A (000333 CH) and Cainiao Smart Logistics Network (1437124D HK) IPOs
• Event-Driven developments – Eoflow (294090 KS), Benesse Holdings (9783 JP), Shidax Corp (4837 JP), Ps Mitsubishi Construction (1871 JP), Hollysys Automation Technologies (HOLI US), Irc Ltd (1029 HK).        

• BeiGene performed well in 23Q3. Product sales maintained strong growth momentum. Together with effective cost control measures, net loss significantly narrowed (close to breakeven), which exceeds expectation.
• BeiGene plans to rely primarily on BRUKINSA/tislelizumab to achieve breakeven, which means BRUKINSA needs to contribute about US$2 billion revenue. Given prescriptions volume, however, Astrazeneca’s Calquence is the biggest holdup.
• Whether BeiGene’s overall revenue can reach US$4 billion is the key point of marginal change in logic. How to further reduce SG&A/R&D expenses has become important topic at this stage.

• In 3Q23, SK Biopharmaceuticals (326030 KS) reported Xcopri U.S. revenue of KRW75.7 billion, up 60% YoY and 19% QoQ, driven by accelerating new patients being treated with the drug.
• In 3Q23, operating loss narrowed sequentially to KRW10.7 billion. However, operating loss widened compared to year-ago period, mainly due to higher operating costs of the company’s U.S. subsidiary.
• The company is on track to report a profitable Q4. With continued momentum, Xcopri is expected to hit blockbuster status by generating revenue of $1B in the U.S. in 2029.

• In 3Q23, Celltrion Inc (068270 KS) reported revenue and operating profit of KRW672B (+4% YoY) and KRW268B (+25% YoY), respectively, driven by broad-based growth across biosimilar portfolio and CMO revenue.
• Operating profit margin is approaching 40% level, highest level in last two years, driven primarily by sales growth around high margin products. Net profit jumped 33% YoY to KRW221B.
• In Oct’23, Celltrion received FDA approval for Zympentra, which is Celltrion’s first product approved as a new drug in the U.S., and is expected to receive patent protection until 2040.

• Results of 9th national VBP was released. The average price reduction was 58% and the maximum price reduction was over 90%. Hengrui (600276 CH)‘s challenge in VBP has just begun.
• The whole CXO sector is more like a cyclical industry than a high-barrier industry. There’re still some pressures/risks have not been fully released. Its future may be darker than before.
• Asymchem’s stock price performance follows the entire CXO sector. Whether Asymchem can obtain large Tirzepatide orders and provide investors with high certainty of outlook is the key for valuation reversal.

• I tally 41 – mostly firm, mostly Asia-Pac – transactions currently being discussed and analysed on Smartkarma. Inside is a timetable of upcoming key events for each deal.
• Four new deals were discussed on Smartkarma this week: Shidax (4837 JP)‘s and CMIC (2309 JP)‘s low-balled Offers; Benesse (9783 JP)‘s MBO/EQT Offer; and IRC (1029 HK)‘s MBO MGO.
• Key updates took place for: Allkem Ltd (AKE AU), Orecorp Ltd (ORR AU), Southern Cross Media (SXL AU), EOFlow (294090 KS), and Hollysys Automation Technologies (HOLI US) 

• TSE plans to publish a list of companies that disclosed and those that are “under consideration” for disclosure in “Management Conscious of Cost of Capital and Stock Price.” 
• TSE’s plan to introduce actual investor feedback on how investors view dialogue and engagement and what kind of information disclosure and IR they expect from companies is commendable.
• It is very important to know what investors actually want to know, what management is doing to achieve this, and how they should interact with investors in IR activities.

SIGA recapped several key developments in its Q3 update, signalling strong top-line momentum going into Q423. Most notably, the recent $18m procurement deal with the European Health Emergency Preparedness and Response Authority (HERA) has surprised to the upside, with more value to be unlocked, in our opinion. With upcoming BARDA (oral and IV TPOXX), Department of Defense (DoD) and HERA deliveries, Q423 will likely be a busy quarter for SIGA. We have increased our FY23 product revenue estimates to c $164m ($155m previously) to reflect the HERA orders, although this has been offset by lower R&D revenue estimates ($8.9m vs $20.5m previously) following the receipt of the final payment under the PEP research contract with the DoD (in Q323). Management continues to target the PEP regulatory submission in 2024 (despite undertaking a trial data reanalysis) and we view this as a next significant milestone for SIGA. Incorporating the results and latest net cash figure, our valuation adjusts to $17.24/share ($17.46/share previously).

• Yesterday, Olympus Corp (7733 JP) announced Q2 earnings which were  trifle light, and announced a sharp downward revision to full-year OP despite higher revs on weaker yen.
• OP takes a hit because of expenses related to the shutdown of Veran Medical device sales (announced 6 Sep, “causing” a 2.4% share price fall the next day).
• They also announced an ¥80bn buyback. That should be worth 3.0-3.5% of shares out, but overhang exists. The label is the label. The details are inside. They matter.

• MariMed report 3Q revenue of $38.8 million, which was slightly ahead of our estimate of $38.5 million.
• This represents a 6.3% increase Q/Q and a 14.4% improvement Y/Y.
• The revenue increase was driven primarily by Maryland. MariMed has a dispensary in Annapolis that converted to adult-use on July 1 and sales grew 88% Q/Q. 

• Wuxi plans to issue 178.4m shares at an indicative IPO price range of HK$19.9-20.6 per share and will raise net proceeds of US$479m at the midpoint of the IPO price.
• The company’s revenues have seen robust growth during the last 3-years driven by growth in ADC outsourcing market while margins have continued to decline.
• We have valued WuXi XDC Cayman (1877628D HK) using a DCF valuation which offers price per share of HK$23.44, 15.7% higher than the midpoint of the IPO price of HK$20.25.

• The baseless confidence of the 177 companies that finally moved to Standard Market that their market capitalization would increase in18 months was nothing more than a waste of time.
• It is fine for a company to aim to be listed on the highest prime market, but high shareholder returns and quality management must come first.
• If the listing criteria for prime market was JPY100 billion market capitalization, the gap with investors who initially expected prime market before the market restructuring would have been much smaller.

• Rubicon Organics is a leading producer of premium cannabis products in Canada.
• In a challenging market, the company is differentiated by offering top-shelf, organically grown flower in the higher-margin premium market.
• Interim CEO, CFO, and Director Margaret Brodie joined us on The Water Tower Hour to discuss how Rubicon is overcoming the common Canadian obstacles. 

• WuXi XDC Cayman (1877628D HK), a leading contract research, development and manufacturing organization (CRDMO), has launched an HKEx IPO to raise up to US$470 million.
• We previously discussed the IPO in WuXi XDC IPO: The Bull Case and WuXi XDC IPO: The Bear Case.
• Blue-Chip cornerstones will purchase US$300 million of the offer. Our base-case DCF valuation is HK$22.84 per share, 12.8% above the midpoint of the IPO price range.

• CMIC Holdings (2309 JP) decided to “change its business model” this past spring, transferring control of a consolidated JV and other subs to DNP. 
• The result changed the accounting, and the business model, capitalising future cashflow and net income in a “hidden” asset which may or may not be in the Financial Advisor’s valuation.
• My read is this is being done too cheaply, and the price should be 30-60% higher. But, it would be tough to block this.

• MariMed reports 3Q earnings on November 8 after the close.
• Q/Q, we are expecting 5.4% revenue growth and a slight contraction in AEBITDA.
• Maryland should be the most significant driver of the top-line improvement.

• WuXi XDC Cayman (1877628D HK) is looking to raise US$470m in its Hong Kong IPO.
• WuXi XDC Cayman (WXDC) is a CRDMO focused on the global antibody drug conjugates (ADC) and broader bioconjugate market providing integrated and end-to-end services.
• In this note, we will look at the deal dynamics and share our final thoughts on valuation.

• CMIC Holdings (2309 JP) has recommended an MBO tender offer of JPY2,650 per share, a 55.9% premium to the undisturbed price (7 November).
• The transaction is a two-step acquisition through a cash tender offer and subsequent squeeze-out. The lower limit of the tender offer is set at a 41.29% ownership ratio.
• Irrevocables to accept represent a 23.29% ownership ratio. While the offer is light vs. peer multiples, the minimum acceptance condition requires a 35.1% minority acceptance rate, which is doable.

• WuXi XDC set terms for an upcoming IPO: the fast-growing CRDMO offers 178.4M shares at the price range of HK$19.90-HK$20.60, implying a market cap of ~HK$23.9B (~$3B) at the midpoint. 
• Cornerstone investors agreed to subscribe and buy ~116M shares, assuming the IPO price of HK$20.25 at the midpoint. WuXi XDC shares will begin trading on Friday, November 17. 
• My PT of HK$25.57 implies a ~26% upside to the IPO price at the midpoint. WuXi XDC’s premium multiples reflect 100%+ top-line growth and the company’s leadership position. 

• Companies disclosing in English increased to 97.2% in 2023 prime market. However, only 15% of overseas investors responded “satisfied,” indicating a continuing mismatch between disclosure content and investor needs.
• TSE will prioritize the documents according to whether disclosure requires immediacy, and divide companies into mandatory companies and effort companies according to the size and foreign ownership of a company.
• However, disclosure in English of lower priority documents would be more difficult. Separating companies would allow the prime market to include companies that don’t need to interact with global investors.

• Although RemeGen’s 23Q1-Q3 sales was better-than-expected, the Company is difficult to achieve management’s performance guidance for 2023. Since RemeGen’s commercialization logic has “undeniable flaws”, net loss would be further widened.
• Cash balance of RemeGen was just RMB600 million by 23Q3, which is not enough to cover its high R&D/SG&A expenses. If RemeGen cannot secure sufficient financing timely, risks are significant.
• The current valuation and investors’ expectations for RemeGen largely rely on the potential license-out deal of RC18. However, we remain caution until RC18 has sufficient evidence to win head-to-head trial.

• Q1-2 FY3/2024 results were in line with upwardly-revised company guidance, with gross margins reaching 60.4% and a record-high quarterly level of 61.0% for Q2 FY3/2024.
• This was driven by overseas growth for Shofu’s competitive Chemical Products (CAD/CAM resin materials and restorative filling materials) and a forex tailwind, with overseas sales making up 57.6% of total sales.
• We have raised our earnings estimates for FY3/2024 and beyond to reflect Shofu continuing to gain market share overseas, and the resultant improvement in the sales mix

• Ono Pharmaceutical (4528 JP) reported double-digit growth in revenue, operating profit, and net profit in H1FY24. Opdivo recorded revenue of ¥75B (+7% YoY). Forxiga revenue jumped 36% YoY to ¥36B.
• Encouraged by strong performance of Forxiga and receipt of lump-sum income associated with the patent litigation settlement, Ono has raised FY24 guidance by mid-to-high single-digit percentage across all the parameters.
• The company aims to overcome Opdivo patent cliff and accelerate growth by launching multiple products in the U.S. and Europe with large addressable markets.

• WuXi XDC Cayman (1877628D HK), a leading contract research, development and manufacturing organization (CRDMO), is pre-marketing an HKEx IPO to raise US$500 million, according to press reports.
• We previously discussed the IPO in WuXi XDC IPO: The Bull Case and WuXi XDC IPO: The Bear Case.
• In this note, we present our forecasts and take the first look at WuXi XDC’s potential valuation range.

• WuXi XDC Cayman (1877628D HK) is looking to raise around US$500m in its upcoming Hong Kong IPO.
• WuXi XDC Cayman (WXDC) is a CRDMO focused on the global antibody drug conjugates (ADC) and broader bioconjugate market providing integrated and end-to-end services.
• In this note, we share our updated thoughts on valuation and look at bull/bear scenarios for WXDC’s earnings.

• Even after the “TSE’s request,” the average P/B of listed companies has not increased. In addition, ROE, which can be considered a driver for corporate value expansion, has remained flat.
• Japanese managers tend to be caught up in formalistic thinking about whether or not a company is listed, and whether or not it’s listed on the highest market or not.
• Instead of being caught up in formalistic thinking, I would like managers to seriously rethink the value of the company and what it means to be listed.

• WuXi XDC, a leading CRDMO focused on the global ADC and bioconjugate market, filed to go public in Hong Kong and plans to raise up to $500M.
• The company is expected to IPO in November or December at the latest. Morgan Stanley, Goldman Sachs, and J.P. Morgan are the lead underwriters. The offering may attract investor interest.
• WuXi Biologics will spin off its ADC business, and WuXi XDC will raise capital through IPO to finance the construction of new facilities in Singapore and expand capacity in China.

• HighTide Therapeutics, a China-based clinical-stage biotechnology company, plans to raise up to US$200m via a Hong Kong listing.
• In this note, we examine the company’s core products, namely HTD1801, for the indication of NASH and T2DM.
• We are not yet convinced of the product’s prospects. We also think the management and pre-IPO investors are of mediocre quality.

• In 23Q3, CanSino’s revenue returned to positive growth and net loss narrowed as MCV4 sales exceeded expectations. Such strong growth momentum is expected to continue in 2024.
• As negative impact of COVID-19 assets impairment on revenue/asset sides would basically come to an end this year,2024 performance would reflect growth on the basis of this year’s low base.
• The potential resurgence of pandemic/influenza virus and PCV13i NDA submission could be catalysts. Performance turning point could appear in 2025.The cooperation with Gates Foundation would open up the internationalization prospect.

Oryzon’s Q323 results recapped the clinical progression across its drug development pipeline. The company continues to develop therapies that address unmet needs related to the central nervous system (CNS) and oncology. As noted previously, an important development was the positive safety data for the PORTICO trial, assessing vafidemstat in patients with borderline personality disorder (BPD). Oryzon continues to enrol patients for its lead oncology trial (FRIDA), investigating iadademstat as a potential treatment for acute myeloid leukaemia (AML) and an update is expected in Q224. Based on current visibility, we have adjusted our FY23 operating loss estimates to €5.4m (vs €3.8m previously). Top-line data from PORTICO and FRIDA are expected to be the next key catalysts. Gross cash at the end of Q323 stood at US$8.8m (€8.4m), down from US$14.6m in H123, which we anticipate should fund the company’s operations into Q124. We value Oryzon at €900.3m or €15.4/share (up from €874.1m or €15.6/share).

• Underlying market is set to double – 7m people on maintenance dialysis by 2035, implying a CAGR of 6%
• Stock price decline is “irrational”. There will be no impact for 10-15 years!
• Lots of investor interest, with many IR roadshows in the coming weeks. IR believes the share price overhang will remain for longer.

• The recovery of concentrated TCM granules business makes us optimistic about China TCM’s 2023 full-year performance growth. The resurgence of pandemic and privatization rumor always attract the attention of investors.
• Pientzehuang’s 23Q3 performance was disappointing. Consumption downgrade makes the strategy of raising prices no longer effective. There is downward pressure on valuation as performance will not turn around soon.
• The investment logic of rigid demand is more convincing than consumption upgrading. So, China TCM is more likely to outperform Pientzehuang. Our view is long China TCM, and short Pientzehuang.

• This is the somewhat-brand-spanking-new Quiddity Mainland Connect NORTHBOUND Monitor. We work off the same presentation as the A/H Premium Monitor and HK Connect SOUTHBOUND Monitor.
• The same five names continue at the top of the gross flows list – Kweichow Moutai, Contemporary Amperex, Wuliangye Yibin, Foxconn Industrial, and BYD. Nets are dropping.
• NORTHBOUND saw net inflow for the first time in three months. Small at RMB 557mm, but positive.