Fangzheng Securities: Maintains a "strong recommendation" rating for SINO BIOPHARM (01177), and Anfangning has been approved for listing by the National Medical Products Administration.

Fangzheng Securities released a research report stating that they maintain a "strongly recommended" rating for SINO BIOPHARM (01177), and forecast the company's revenue for 2024-2026 to be RMB 29.727 billion, 33.577 billion, and 38.427 billion respectively, with year-on-year growth rates of 12.7%, 12.95%, and 14.44%. On November 8th, SINO BIOPHARM's self-developed KRAS G12C inhibitor Gefitinib tablets (trade name: Anfangning) received approval for listing from the National Medical Products Administration, suitable for treating advanced non-small cell lung cancer (NSCLC) patients with KRAS G12C mutations. Below are the main points of Fangzheng Securities: 1) Gefitinib clinical data has shown excellent performance, reshaping the treatment landscape for KRAS G12C mutations. Gefitinib is the fourth type 1 innovative drug approved by SINO BIOPHARM this year, the fourth globally and second domestically targeted at KRAS G12C. By selectively binding to the SWITCH II region of the KRAS G12C mutation, it blocks the transmission of oncogenic signals, effectively inhibiting tumor cell proliferation. Phase II clinical trials showed an objective response rate (ORR) of 52%, a disease control rate (DCR) of 88.6%, a median progression-free survival (PFS) of 9.1 months, and a median overall survival (OS) of 14.1 months in KRAS G12C mutation NSCLC patients. These data demonstrate that Gefitinib has a significant survival extension effect in this patient population, filling a gap in the treatment of KRAS G12C mutations with limited efficacy of traditional therapies. Furthermore, in June 2024, Gefitinib was included in the breakthrough therapy program for two indications, pancreatic ductal adenocarcinoma and rectal cancer. Among the two KRAS G12C inhibitors approved for global marketing, Amgen's Sotorasib had sales of approximately $285 million in 2022 and $280 million in 2023, while Mirati Therapeutics' Adagrasib had sales of $36 million in Q1-Q3 2023. Based on the results of the phase II clinical data treating NSCLC with D-1553 tablets as a single agent, it outperforms the marketed products Adagrasib and Sotorasib in the treatment of advanced non-small cell lung cancer. The company believes that, given SINO BIOPHARM's strong sales capabilities and exceptional clinical data of their products, D-1553 tablets are likely to capture a significant market share after their launch for the treatment of advanced non-small cell lung cancer and colorectal cancer, with projected peak sales of RMB 1.158 billion. 2) The company's comprehensive transformation towards innovation is yielding results, and it will continue to expand its international strategy in the future. The company is actively exploring in the field of innovation, with a rich technological layout and accelerated clinical development speed, achieving rapid growth in revenue from innovative products. In the first half of the year, three types of anticancer type 1 innovative drugs, Anakinib, Ifosfamide, and Bevacizumab, were approved for listing, with continued expansion in the field of major cancers such as lung cancer. The CDK2/4/6 inhibitor for second-line treatment of HR+/HER- breast cancer is expected to be launched next year. In addition, through cooperation with Bristol Myers Squibb, the company is supplementing its oncology pipeline and moving towards global pharmaceutical companies. In the first three quarters of 2024, the company's operating income was approximately RMB 21.35 billion, an increase of 11.9% year-on-year, and net profit attributable to shareholders was approximately RMB 4.17 billion, a year-on-year increase of approximately 134.9%. Based on the pipeline under research, it is expected that around seven new innovative drugs will be successively approved for market launch from 2024 to 2026. The company is steadily advancing along its two global strategy routes, "in China for Global" and "in Global for Global." On one hand, the company is using its existing product portfolio, including Anakinib and biosimilars, to enter Southeast Asia and Middle Eastern markets. On the other hand, through its subsidiary InvoX, the company is entering global markets, including the United States and Europe, by supplementing its research pipeline and dual antibody platform, continuously exploring new driving forces for company development.