Focus on selling non-core projects of anti-cancer drug pipeline JACOBIO-B (01167).

On October 16, Genscript Biotech Corporation (01167) announced that its wholly-owned subsidiary, Beijing Genscript New Drug Development Co., Ltd. ("Beijing Genscript"), signed a capital increase and equity transfer agreement with Shanxi Haisong Management Consulting Partnership (Limited Partnership) ("Haisong Capital") and an industry cooperation party. According to the agreement, Haisong Capital will acquire 80% of the equity of Genscript Realcan Pharmaceutical Group Technology Co., Ltd. ("Gecraycom") under Beijing Genscript for 200 million RMB. After the completion of the transaction, Beijing Genscript, Haisong Capital, and the industry cooperation party will respectively hold 10%, 80%, and 10% of the equity in Gecraycom. Gecraycom is a project company of Genscript's early cardiovascular research and development project. This transaction reflects Genscript's long-term strategic focus on innovative cancer drug pipelines, helping to optimize resource allocation, improve organizational efficiency, and retain future project value through risk-sharing models. From the perspective of R&D pipeline, Genscript's layout is focused on two main directions - KRAS and iADC. Among them, KRAS is considered the "core mutation pathway" in the field of cancer, with about one-fourth of cancer patients having related mutations. In May of this year, the company's KRAS G12C inhibitor, glecirasib, was approved by the National Medical Products Administration for second-line treatment of KRAS G12C mutation non-small cell lung cancer (NSCLC), and has been successfully launched in China. The company received a down payment of 200 million RMB last year from its partner, Shanghai Allist Pharmaceuticals Co., Ltd., and triggered a milestone payment of 5 million RMB this year, marking a key breakthrough in commercial realization for Genscript. In addition, glecirasib is undergoing a registration study in combination with SHP2 inhibitor JAB-3312 for the first-line treatment of KRAS G12C mutation NSCLC. At the same time, the company's other core product, pan-KRAS inhibitor JAB-23E73, has observed multiple confirmed partial response (PR) cases in a Phase I clinical trial conducted in China and the United States. The safety and pharmacokinetic characteristics are as expected. According to the plan, this product will publish complete data in the first half of 2026. If the subsequent development goes smoothly, this product is expected to become the world's first late-stage clinical pan-KRAS inhibitor. Although the Pan-Ras inhibitor from Rev.Med in the U.S. (different from the pan-KRAS inhibitor) is currently in Phase III clinical trials, the two have significant differences in mechanism of action, and their clinical and commercial prospects are highly anticipated. In addition to KRAS G12C and pan-KRAS, Genscript is advancing a second-generation product, EGFR-KRAS G12D tADC. This project aims to deliver precise treatment through EGFR antibodies while incorporating KRAS G12D inhibitors as effective payloads, potentially becoming a major product in the field of colorectal cancer. The company is expected to submit an IND application in the second half of 2026. In the future, Genscript hopes to address colorectal, lung, pancreatic cancer, and other indications with different warheads and KRAS payloads. Market analysts point out that the value of Genscript's pipeline and long-term growth potential have not been fully reflected in the current stock price. Genscript's U.S.-listed peer, Revolution Medicine (RVMD.US), has a market value of approximately 9 billion USD, while Genscript is valued at less than 7 billion HKD. The chairman and controlling shareholder have recently increased their holdings by nearly 100 million HKD, and the company is also moving forward with share repurchases, sending a clear signal to the market that the management is confident in the long-term development of the company. As clinical data continues to validate and core pipeline products enter later-stage development, Genscript is expected to gradually gain market revaluation through the dual drivers of "management increase holdings + value release of pipeline". This transaction, which divests non-oncology pipelines, aligns with Genscript's strategic focus on core oncology innovative drug pipelines (including KRAS, MYC, P53, and tumor immunotherapy) and is intended to optimize resource allocation, improve organizational efficiency, and retain future project value through risk-sharing models.