BOCOM INTL: Maintains "buy" rating on SKB BIO-B (06990) with target price increased to HK$549.

BOCOM INTL released a research report stating that based on regulatory approval progress, more optimistic expectations for the sales of Sac-TMT and bodotuximab pearls have been raised. The revenue forecast for 2025-27 has been raised by 0-5%, respectively, and the peak PoS adjusted forecast has been raised to 6.4 billion/1.1 billion RMB. The DCF target price for the stock has been raised to 549 Hong Kong dollars, maintaining the "buy" rating for SKB BIO-B(06990), optimistic about the huge global value of the ADC product matrix driven by clinical data. Sac-TMT sets a new benchmark for EGFR mutant resistant NSCLC treatment: The phase III OptiTROP-Lung04 study of ralvinshahtuzumab (Sac-TMT) (second-line treatment for EGFR mutant, TKI-treated advanced NSCLC, Sac-TMT monotherapy compared to platinum-based chemotherapy) results were presented at the ESMO conference: The Sac-TMT treatment group showed significant improvement in PFS and OS compared to the control group: median PFS was 8.3 vs. 4.2 months, HR=0.49 (95% CI: 0.39-0.62, p<0.0001); median OS was NR vs. 17.4 months, HR=0.60 (95% CI: 0.44-0.82, two-tailed p=0.001), with OSHR significantly better than other therapies for the same indication, to some extent providing more choices for subsequent treatment with lower toxicity accumulation. Consistent OS and PFS benefits were also observed in all predefined key subgroups, with an OSHR of 0.59 in patients receiving third-generation EGFR therapy consistent with the overall population. Similar grade 3 TRAEs were observed in both groups (58% vs. 53.8%). The indication's marketing application was approved in October. Compared to the competitor Dato-DXd with the same target, the occurrence rates of oral mucositis, ocular toxicity, and interstitial pneumonia were lower with Sac-TMT, while the hematologic toxicity rate was higher but with more clinical management experience. It is worth noting that in the phase III TROPION-Lung01 study of Dato-DXd (nsq-NSCLC in the backline), the OS statistically favored efficacy was not achieved, including the driving gene mutation subgroup. The ADC product matrix has also made significant progress in breast cancer: The application for market approval of Sac-TMT for second-line and above HR+/HER2- breast cancer was recently accepted by CDE, and the HER2 ADC bodotuximab pearls were first approved for use in 2L+ HER2-positive breast cancer in October. The results of their respective phase III studies were also announced at the ESMO conference: 1) In the OptiTROP-Breast02 study, Sac-TMT achieved statistically significant PFS (median 8.3 vs. 4.1 months, HR 0.35, p<0.0001), preliminary OSHR 0.33, statistically significant PFS benefits were observed in all predefined subgroups, including different lines of treatment and HER2 expression levels. The company sees potential applications in DS-8201-resistant patients in the future. 2) In the KL166-III-06 study, bodotuximab pearls outperformed T-DM1, significantly prolonging median PFS (11.1 vs. 4.4 months, HR 0.39, p<0.0001).