CICC: Maintains "Outperform" rating on INNOVENT BIO (01801) with a target price of HK$58.

CICC released a research report stating that it maintains a "outperform the industry" rating for INNOVENT BIO (01801). Considering that the company's revenue exceeded expectations, the revenue forecast for 2024 is raised by 5.4% to 8.34 billion yuan, while the revenue forecast for 2025 remains unchanged at 10.42 billion yuan. Due to uncertainty in expenses, the forecast for net profit attributable to shareholders for 2024/2025 remains unchanged at -780 million yuan/490 million yuan, with a target price of 58 Hong Kong dollars. Event: On October 30, the company announced that the product revenue for 3Q24 exceeded 2.3 billion yuan, an increase of over 40% year-on-year. The revenue for the third quarter exceeded the bank's expectations, mainly due to the product volume exceeding expectations. In addition, on September 26, the company announced that the new drug application (NDA) for the anti-PD-1 antibody medicine Pitcitacchi for moderate to severe psoriasis had been accepted by the National Medical Products Administration, and data for ulcerative colitis and biologic treatment for psoriasis were reported in October. CICC's main points are as follows: The revenue for the third quarter is impressive, with multi-line growth of products. According to the financial report from LILLY, the sales of Sintilimab in 3Q24 reached 150 million US dollars, a year-on-year increase of 30%. The bank expects Sintilimab to maintain a leading position in the domestic market. In addition, according to the company's announcement, the revenue for other major products also grew rapidly in the third quarter. As of October, the company has obtained approval for 11 products, and the new KRAS G12C inhibitor Fluorescein Ethylene Zeolite tablets have been approved for marketing. The bank believes that the company's pipeline portfolio is becoming increasingly complete and is expected to contribute to new growth. The application for the listing of the Pitcitacchi anti-PD-1 antibody drug for psoriasis demonstrates efficacy and compliance advantages. According to the company's announcement, Pitcitacchi is the first IL-23p19 antibody drug in Phase III clinical trials to reach a proportion of patients achieving PASI 90 at week 16 exceeding 80%, and its maintenance dose interval of 12 weeks is the longest among similar biologics. In addition, on October 29, the company announced data for Pitcitacchi in patients with poor response to previous biologic treatments (mainly with IL-17 antibodies), with 64.6% of patients achieving clearance/near clearance of skin lesions (sPGA 0/1) after 16 weeks of treatment. The bank expects Pitcitacchi to be approved for marketing as early as 2025, and with the differentiated advantages of its efficacy and dosing interval, it is expected to become a potential blockbuster product in the domestic psoriasis market. The Phase II data for ulcerative colitis are impressive, and Pitcitacchi has the potential to continuously expand its indications. On October 17, the company announced that Pitcitacchi reached the primary endpoints in a Phase II clinical trial for moderate to severe ulcerative colitis in China. In the induction therapy period at week 12, the proportions of patients achieving clinical remission in the Pitcitacchi 200 mg and 600 mg groups were 20.0% and 14.0%, respectively (vs. 2.0% in the placebo group; p <0.05); the proportions of patients achieving clinical response were 54.0% and 68.0%, respectively (vs. 22.0% in the placebo group; p <0.001). The bank suggests paying attention to the development progress of Pitcitacchi in subsequent indications for ulcerative colitis.