香 港 交 易 及 結 算 所 有 限 公 司 及 香 港 聯 合 交 易 所 有 限 公 司 對 本 公 告 之 內 容 概 不 負 責，對 其 準 確 性 或 完 整 性 亦 不 發 表 任 何 聲 明，並 明 確 表 示，概 不 就 因 本 公 告 全 部 或 任 何 部 分 內 容 而 產 生 或 因 倚 賴 該 等 內 容 而 引 致 的 任 何 損 失 承 擔 任 何 責 任。 Akeso, Inc. 康方生物科技（開曼）有限公司 （於開曼群島註冊成立的有限公司） （股份代號：9926） 截 至2024年12月31日 止 年 度 業 績 公 告 康 方 生 物 科 技（開 曼）有 限 公 司 董 事 會 謹 此 公 佈 本 集 團 截 至2024年12月31 日 止 年 度 的 綜 合 業 績。該 等 年 度 業 績 已 經 由 本 公 司 審 核 委 員 會 審 閱 及 本 公 司 核 數 師 安 永 會 計 師 事 務 所 同 意。 於 本 公 告 中，「我 們」指 本 公 司 或 按 文 義 指 本 集 團。 財 務 摘 要 1. 收 入 截 至2024年12月31日 止 年 度，本 集 團 ...

Investment Rating - The report maintains a "Buy" rating for 康方生物 (9926 HK) with a target price of 87 HKD, indicating a potential upside of 26.7% from the current price of 68.65 HKD [4][5]. Core Insights - 康方生物 has entered a clinical trial collaboration with Pfizer to explore the potential of combining its PD-1/VEGF dual antibody, 依沃西, with multiple vedotin ADCs from Pfizer for treating various solid tumors. The clinical trials are expected to start in mid-2025, primarily focusing on Phase Ib/II studies [1][3]. - The collaboration is significant as Pfizer has a robust pipeline of vedotin ADCs, which have shown promising preliminary clinical results when combined with PD-1 targeted therapies, suggesting a synergistic anti-tumor effect [2][3]. - 康方生物 is also advancing its clinical trials in multiple indications, including biliary cancer, head and neck squamous cell carcinoma, pancreatic cancer, and triple-negative breast cancer, with several key catalysts expected in 2025 [3]. Summary by Sections - **Clinical Collaboration**: 康方生物's partnership with Pfizer aims to leverage the strengths of both companies in developing innovative cancer therapies, with a focus on the efficacy of 依沃西 in combination with vedotin ADCs [1][3]. - **Pipeline and Milestones**: Key milestones for 康方生物 in 2025 include the readout of the HARMONi trial for EGFR TKI-treated NSCLC, the initiation of the ADC combination trials, and ongoing patient enrollment in important Phase III studies [3]. - **Market Position**: 康方生物 is positioned as a key player in the oncology sector, with a strong emphasis on expanding its clinical development efforts and maintaining a competitive edge in the market [3].

Investment Rating - The report maintains a "Buy" rating for the company, with a target price of HKD 87.00, indicating a potential upside of 45.9% from the current price of HKD 59.65 [1][6][12]. Core Insights - The company has recently submitted its third non-oncology product for market approval and has initiated multiple Phase III trials for its product, Ivoris, in various indications beyond lung cancer, reaffirming the "Buy" rating [2][6]. - The financial forecasts have been adjusted, reflecting a more cautious short-term sales outlook, but the long-term peak sales estimates for key products have been maintained or increased [6][7]. Financial Overview - Revenue projections for 2024, 2025, and 2026 are revised to RMB 2,411 million, RMB 4,096 million, and RMB 5,861 million respectively, with significant growth expected in the following years [5][14]. - The net profit is expected to improve from a loss of RMB 509 million in 2024 to a profit of RMB 595 million in 2025, and further to RMB 1,707 million in 2026 [5][14]. - The company’s market capitalization is approximately HKD 53.42 billion, with a 52-week high of HKD 77.55 and a low of HKD 31.80 [4][6]. Product Development - The company has successfully submitted its eighth innovative drug application, targeting moderate to severe plaque psoriasis, enhancing its product portfolio in the autoimmune field [6][7]. - The ongoing Phase III studies for Ivoris in various cancers are expected to expand its market opportunities significantly, particularly in indications with limited current treatment options [6][7]. Valuation Model - The DCF valuation model estimates the equity value at approximately RMB 70,990 million, translating to a per-share value of HKD 87.00 [8].

Investment Rating - The report maintains a "Buy" rating for the company [1] Core Views - Ivonescimab (依沃西单抗) demonstrated significant therapeutic benefits in multiple clinical trials, particularly in the HARMONi-2 study where it outperformed pembrolizumab (帕博利珠单抗), showcasing its potential as a global blockbuster [1] - The overseas expansion of Ivonescimab is expected to enhance its revenue peak and company valuation [1] - The company's mature pipeline, including cadonilimab (卡度尼利单抗) and inusirumab (伊努西单抗), is progressing steadily towards commercialization, with new indications and market potential [4] Clinical Results - In the HARMONi-2 study, Ivonescimab showed a significant PFS advantage over pembrolizumab (11.14 vs 5.82 months, HR=0.51) and demonstrated excellent safety with low rates of TRAE-related discontinuation and mortality (1.5% and 0.5%) [2] - Ivonescimab also showed promising efficacy in NSCLC perioperative treatment, head and neck squamous cell carcinoma, colorectal cancer, and TNBC in Phase II trials [2] Overseas Expansion - Ivonescimab's overseas Phase III trials, HARMONi and HARMONi-3, are progressing, with HARMONi-3 expanding its target population to include both squamous and non-squamous NSCLC [3] - The HARMONi-7 study targeting PD-L1 strong-positive NSCLC patients is set to begin in early 2025, further enhancing Ivonescimab's global potential [3] Other Pipelines - Cadonilimab has seen new indications approved and has been included in the national medical insurance, boosting its commercialization potential [4] - Inusirumab, a PCSK9 monoclonal antibody, was approved in September, and other non-oncology drugs are expected to be launched within the next three years [4] Market Differentiation - The report differs from market consensus by expressing strong confidence in the company's overseas potential, citing the robust data from the HARMONi-2 study and the likelihood of replicating domestic success in international markets [5] Financial Forecasts and Valuation - Revenue forecasts for 2024/2025/2026 have been revised downward to 2.312/3.342/5.409 billion RMB (down 13.0/20.8/14.0% from previous estimates) due to national negotiations and the approval pace of non-oncology drugs [6] - The DCF terminal value has been increased from 36 billion to 65.2 billion RMB, leading to a target market cap of 84.5 billion RMB and a target price of 100.45 HKD [6] Industry Insights - The report highlights the potential of IO (immuno-oncology) combined with anti-angiogenesis therapies, noting that while some combinations have shown promise, others have failed due to toxicity and efficacy issues [27][28] - The LEAP series of studies, which explored the combination of pembrolizumab and lenvatinib, showed mixed results, with some studies achieving positive outcomes while others failed to meet OS endpoints [29][30][31]

Investment Rating - The report assigns a **Buy** rating to the company with a target price of **HKD 77.7**, representing a **19% upside** from the current price of HKD 65.2 [5] Core Views - The company's R&D pipeline demonstrates **world-class potential**, particularly with its key products **AK104 (PD-1/CTLA-4)** and **AK112 (PD-1/VEGF)**, which have shown significant clinical progress and market potential [2][3] - The company's revenue in H1 2024 increased by **24% YoY to RMB 940 million**, driven by strong sales of **AK104 (RMB 710 million, +16.5% YoY)** and **AK105 (RMB 130 million)** [2] - Despite a net loss of **RMB 240 million** in H1 2024, the company maintains a strong cash position of **RMB 2.4 billion**, supported by two successful placements in 2024 raising **HKD 1.17 billion** and **HKD 1.92 billion** respectively [2] Product Pipeline Summary AK104 (PD-1/CTLA-4) - Achieved **PFS (12.7 vs 8.1 months, HR 0.62)** and **OS (not reached vs 22.8 months, HR 0.64)** endpoints in **first-line cervical cancer**, with significant efficacy across all populations, including **PD-L1 low/negative expression** (CPS <1, 23% reduction in death risk) [3] - Approved for **first-line gastric cancer** in October 2024, showing **OS benefit (15 vs 10.8 months, HR 0.62)**, addressing the unmet need in **PD-L1 low/negative gastric cancer** (mOS 17.6 months vs 11 months for PD-1) [3] - Multiple **Phase III trials** ongoing for **gastric cancer post-PD-(L)1 progression**, **hepatocellular carcinoma**, and **non-small cell lung cancer (NSCLC)** [3] AK112 (PD-1/VEGF) - Approved in May 2024 for **EGFR-mutated NSCLC post-treatment progression**, with **Summit global Phase III** trial completed and **FDA Fast Track** designation [3] - Achieved **PFS endpoint (11.14 vs 5.82 months, HR 0.51)** in **first-line PD-L1-positive NSCLC** vs **Pembrolizumab**, with **NDA submitted** in July 2024 [3] - Expanded **Summit Phase III** trial to include **non-squamous NSCLC** with a sample size of **1,080 patients**, alongside ongoing trials for **biliary tract cancer**, **pancreatic cancer**, and **head and neck squamous cell carcinoma** [3] Other Key Products - **AK105 (PD-1)**: Under review for **first-line nasopharyngeal carcinoma** and submitted for **first-line hepatocellular carcinoma** [3] - **AK102 (PCSK9)**: Approved in October 2024 [3] - **AK101 (IL-12/IL-23)**: Submitted for **moderate-to-severe plaque psoriasis** in August 2023 [3] - **AK111 (IL-17)**: Completed Phase III enrollment for **psoriasis** and ongoing for **ankylosing spondylitis** [3] - **AK117 (CD47)**: Global first **Phase III** trial for **solid tumors** [3] Financial Summary - Revenue for 2024E is projected at **RMB 2.5 billion**, with a **32.6% YoY growth** expected in 2025E to **RMB 3.3 billion** [4] - Gross margin remains strong at **91.3%** in H1 2024, with **R&D expenses** increasing by **3% to RMB 590 million** [2] - Net loss for 2024E is estimated at **RMB 184 million**, with a turnaround to **RMB 775 million net profit** expected in 2026E [4] Valuation - The target price of **HKD 77.7** is derived using a **DCF model** with a **WACC of 10.0%** and **perpetual growth rate of 3.0%**, incorporating **AK112's overseas potential** (USD 6 billion sales, 60% success probability) [3]

Investment Rating - The report maintains a "Buy" rating for the company Kangfang Biopharma (09926) [6] Core Insights - Kangfang Biopharma is positioned as a leader in bispecific antibody therapies, successfully challenging established treatments and advancing its internationalization efforts [4][23] - The company has achieved significant clinical trial results, particularly with its product AK112, which has shown promising outcomes against existing therapies in lung cancer treatment [4][6] - The financial outlook is positive, with projected revenues increasing significantly over the next few years, leading to expected profitability by 2025 [6][11] Summary by Sections Company Overview - Kangfang Biopharma focuses on developing innovative and affordable antibody drugs, leveraging a unique end-to-end research and development platform [23] - The company has established a strong pipeline of products, with several in late-stage clinical trials and some already approved for market [23][24] Industry Situation - The tumor immunotherapy market is rapidly growing, with bispecific antibodies playing a crucial role in the evolution of cancer treatment [11][23] - The report highlights the limitations of current T-cell targeting immunotherapies and the potential of bispecific antibodies to address these challenges [11] Company Highlights - AK112 has demonstrated breakthrough results in clinical trials, positioning it as a potential new standard for first-line treatment in lung cancer [4][6] - The company’s product AK104 has also shown significant efficacy in treating advanced cervical cancer, filling a gap in the current treatment landscape [5][6] Financial Forecast and Valuation - Projected revenues for 2024, 2025, and 2026 are estimated at 26.78 billion, 43.33 billion, and 69.78 billion yuan respectively, with a return to profitability expected in 2025 [6][11] - A DCF valuation model suggests a reasonable market capitalization of 754.15 billion HKD, corresponding to a target price of 84.15 HKD per share [6]

Investment Rating - The report maintains a "Buy" rating for 康方生物 (9926) [4][3] Core Insights - The clinical data for 卡度尼利 in first-line cervical cancer is impressive, with significant benefits observed across the entire population. The company has completed a new round of stock placement to accelerate global development of new drugs [3][4] - The revenue forecasts for 2024-2026 have been revised upwards to 29.40 billion, 47.76 billion, and 67.55 billion RMB respectively, compared to the previous estimates of 29.24 billion, 47.69 billion, and 65.95 billion RMB [4] - The ODAC meeting has further refined the first-line gastric cancer population, enhancing 卡度尼利's competitive advantage [4] Summary by Sections Clinical Data - The results from the Phase III clinical study for 卡度尼利 combined with platinum-based chemotherapy ± bevacizumab for first-line treatment of persistent, recurrent, or metastatic cervical cancer showed a progression-free survival (PFS) of 12.7 months versus 8.1 months for the control group (HR=0.62) and overall survival (OS) results of NR versus 22.8 months (HR=0.64) [4][8] - In the gastric cancer setting, 卡度尼利 demonstrated significant overall survival benefits, particularly in patients with low PD-L1 expression [4][9] Financial Overview - The company successfully raised approximately 19.42 billion HKD through a new stock placement, with over 8.2 billion HKD expected to be allocated for accelerating clinical development of core products globally [4][5] - The current market capitalization of 康方生物 is approximately 58.835 billion HKD, with a share price range over the past year between 31.80 and 74.40 HKD [5][4] Competitive Landscape - The FDA's recent ODAC meeting supported the segmentation of PD-1 drug applications based on PD-L1 expression levels, which positions 卡度尼利 favorably against existing treatments for gastric cancer [4][9] - The report highlights that 卡度尼利's treatment regimen offers significant survival benefits compared to PD-1 monoclonal antibodies, particularly in populations with low PD-L1 expression [4][8]

Investment Rating - The investment rating for the company is "Buy" with a target price of HKD 87.00, indicating a potential upside of 25.8% from the current price of HKD 69.15 [2][7]. Core Insights - The report highlights the approval of two new indications for the company's products, significantly expanding its commercial portfolio into non-oncology areas. The approval of the drug 开坦尼 for first-line treatment of gastric cancer is expected to greatly increase its potential patient population, with an estimated peak sales forecast adjustment to RMB 5.2 billion. Additionally, the approval of AK102 for primary hypercholesterolemia and mixed dyslipidemia is noted as a strong competitive advantage in the market [1][2]. - Recent clinical data releases from major conferences such as ESMO and EADV have shown promising results for the company's products, particularly for IL-17 古莫奇单抗 in treating moderate to severe plaque psoriasis and for the drug 依沃西 in various solid tumors, which may enhance the clinical application and extend the product lifecycle [1][2]. Financial Summary - Revenue projections for 2024-2026 have been increased by 6-10% due to the recent approvals and positive clinical developments. The new revenue estimates are RMB 2,849 million for 2024, RMB 4,786 million for 2025, and RMB 6,465 million for 2026, reflecting significant growth compared to previous forecasts [4][5]. - The company is expected to report a net profit of RMB 786 million in 2025 and RMB 1,880 million in 2026, indicating a recovery from losses in 2024 [4][5]. - The DCF valuation model suggests a fair value of HKD 87.0 per share, supported by anticipated catalysts such as the outcomes of insurance negotiations and the approval of new indications [2][6].

Product Development and Innovation - Akeso, Inc. has over 50 innovative projects in development, with 10 products in commercialization or Phase III clinical trials, including 4 approved products and 2 under NMPA review[2]. - The company has developed a Tetrabody technology to address three CMC challenges in developing and producing bispecific antibodies, including low expression levels and stability issues[2]. - Akeso aims to become a leading global biopharmaceutical company through efficient and innovative R&D, focusing on first-in-class and best-in-class bispecific antibodies[2]. - The company is advancing the Phase III clinical trial of Cardunili, focusing on its efficacy in various cancers, with over 20 clinical trials ongoing across 16 indications[14]. - The company is actively pursuing partnerships and collaborations to enhance its research and development capabilities[26]. - The company is focusing on tumor immunotherapy, with products in clinical trials including approved therapies and several bispecific antibodies targeting various indications[24]. - The company aims to address unmet medical needs in oncology through its diverse product pipeline[25]. - The company is advancing its product candidates into Phase Ib/III trials, indicating a strong commitment to clinical development[25]. - The company has submitted IND applications for three candidates: AK137 (CD73/LAG-3) for advanced malignancies, AK138D1 (HER3 ADC) for advanced malignancies, and AK135 (IL-1RAP) for chemotherapy-induced peripheral neuropathy[23]. Financial Performance - Total revenue for the six months ended June 30, 2024, was RMB 1,024.7 million, a decrease from RMB 3,676.9 million for the same period in 2023[8]. - Product revenue for the six months ended June 30, 2024, was RMB 939.4 million, up 23.96% from RMB 757.9 million in the same period last year[11]. - Gross profit for the six months ended June 30, 2024, was RMB 943.2 million, compared to RMB 3,599.7 million for the same period in 2023[9]. - The company recorded a loss of RMB 249.3 million for the six months ended June 30, 2024, compared to a profit of RMB 2,489.5 million for the same period in 2023[10]. - The significant decline in licensing revenue was primarily due to the change in the revenue structure, with licensing income dropping to RMB 85.3 million from RMB 2,919.0 million year-on-year[8]. - The company reported a total comprehensive loss of RMB 250,049 thousand for the six months ended June 30, 2024, compared to a total comprehensive income of RMB 2,498,155 thousand in the same period of 2023[161]. - The company reported a loss attributable to equity holders of RMB (238,590,000) for the six months ended June 30, 2024, compared to a profit of RMB 2,525,045,000 in the same period in 2023[189]. Product Sales and Revenue Sources - Sales of the product Kanti® (Cardunili, PD-1/CTLA-4) generated approximately RMB 705.7 million, an increase of 16.50% from RMB 605.8 million in the previous year[12]. - The main revenue source was from the product 开坦尼® (卡度尼利·PD-1/CTLA-4), which generated RMB 705.7 million, up 16.50% from RMB 605.8 million in the previous year[36]. - Other products contributed RMB 233.7 million, representing a significant increase of 53.66% from RMB 152.1 million[36]. - Revenue from mainland China was RMB 938,131,000, up 24% from RMB 756,189,000 in the previous year[180]. - Revenue from the United States significantly dropped to RMB 85,117,000 from RMB 2,920,093,000, indicating a decline of approximately 97%[180]. Clinical Trials and Regulatory Approvals - The new indication for Cardunili in combination with chemotherapy for advanced gastric cancer received acceptance from NMPA in January 2024[13]. - Cardunili's III phase clinical trial results for cervical cancer were positively reported in July 2024, achieving the primary endpoint in interim analysis[13]. - The product revenue for Yidafang (Yivofisi) reached approximately RMB 103 million during the reporting period, following its approval for use in treating EGFR-mutant NSCLC[15]. - The Phase III trial of Yivofisi against Pabrolizumab in NSCLC achieved positive results, marking it as the first and only monotherapy to do so, with a successful sNDA submission to CDE[16]. - The company has initiated multiple Phase III trials for Yivofisi, including combinations with chemotherapy for various cancers, demonstrating its potential as a cornerstone in tumor immunotherapy[16]. - Anika (Pianpuli) received NMPA approval for treating recurrent/metastatic nasopharyngeal carcinoma, with an sNDA for its combination therapy currently under review[18]. - The Phase III trial of Prolaxi (AK109) in combination with Cardunili for advanced G/GEJ cancer has commenced, with initial patient enrollment reported[19]. Employee and Operational Growth - The total number of employees as of June 30, 2024, is 2,815, an increase from 2,520 as of June 30, 2023, reflecting a growth of approximately 11.7%[30]. - The workforce in the clinical department has increased to 661 employees, up from 642 in the previous year, indicating a growth of approximately 2.9%[31]. - The production, quality assurance, and quality control workforce has grown to 686 employees, an increase of 19.3% from 575 in the previous year[31]. - The company has a total production capacity of 54,000 liters as of June 30, 2024, with plans for continuous expansion to meet future clinical and commercialization needs[32]. Cash Flow and Financial Position - Cash and cash equivalents as of June 30, 2024, amounted to RMB 2,487,349 thousand, up from RMB 1,542,313 thousand as of December 31, 2023, reflecting an increase of 61.1%[162]. - The company reported a net increase in cash and cash equivalents of RMB 926,402,000 for the six months ended June 30, 2024, down from RMB 2,084,516,000 in 2023, a decrease of approximately 56%[169]. - The net cash flow from operating activities for the six months ended June 30, 2024, was (RMB 346,503,000), a significant decrease from RMB 2,871,241,000 in the same period of 2023, indicating a decline of approximately 112%[169]. - The company recognized licensing income of RMB 85,318,000 in the first half of 2024, a significant drop from RMB 2,918,988,000 in the same period of 2023, indicating a decrease of approximately 97%[175]. Corporate Governance and Compliance - The company has confirmed compliance with the standard code of conduct for securities trading by all directors during the reporting period[55]. - The company has adopted and complied with all applicable code provisions of the corporate governance code, except for the separation of the roles of Chairman and CEO[54]. - The company plans to review and monitor its corporate governance practices continuously to maintain high standards[54]. - There were changes in the board of directors, with Dr. Xia Yu resigning as an executive director and Dr. Zhang Peng appointed as an executive director[64]. Shareholder Information and Stock Options - The total number of issued shares as of June 30, 2024, is 865,857,176 shares[68]. - Major shareholders owning 5% or more of the issued shares include Cantrust (Far East) Limited with 47,664,282 shares (5.50%) and YAO Yulin with 43,453,668 shares (5.02%) as of June 30, 2024[71]. - The company has established a stock option plan that allows participants to exercise their options under specific conditions, including performance targets[135]. - The stock option plan allows for a maximum exercise period of 10 years from the grant date[135]. - The company will ensure compliance with listing rules and regulations regarding the stock option plan[134].

Investment Rating - The report maintains a "Buy" rating for the company with a target price of HKD 81.89 [5]. Core Insights - The company’s drug, Ivosidenib, has shown unprecedented results in the HARMONi-2 study, nearly doubling the median progression-free survival (mPFS) compared to Keytruda, achieving 11.14 months versus 5.82 months [1][9]. - Ivosidenib's single-agent "de-chemotherapy" regimen is expected to become the first-line treatment for lung cancer patients with positive PD-L1 expression, with a New Drug Application (NDA) accepted in August [2]. - The overseas value of Ivosidenib is anticipated to be re-evaluated, with peak sales in the U.S. projected to exceed USD 4.5 billion [3][26]. Summary by Sections HARMONi-2 Study Results - The HARMONi-2 study demonstrated that Ivosidenib significantly outperformed Keytruda in mPFS, with a hazard ratio (HR) of 0.51, indicating a 49% reduction in the risk of disease progression or death [1][11]. - The study included a diverse patient population, with 42.2% having high PD-L1 expression, and showed consistent results with previous studies, enhancing the credibility of the findings [10][11]. Single-Agent Efficacy - Ivosidenib achieved an mPFS of 11.1 months, outperforming Keytruda combined with chemotherapy in two Phase III studies, indicating its potential as a first-line treatment option [2][13]. - The safety profile of Ivosidenib is favorable, with a discontinuation rate of only 1.5% due to adverse events [16]. Clinical Development and Market Potential - The company is accelerating clinical development for Ivosidenib, with plans for further studies in various cancers, including colorectal and triple-negative breast cancer [3][26]. - Financial projections estimate revenues of CNY 26.5 billion, CNY 40.6 billion, and CNY 64.2 billion for 2024, 2025, and 2026, respectively, with a net profit forecasted to turn positive by 2025 [4][27].