Huaxi: RAS moves from being an undruggable target to a breakthrough in broad targeting. The largest blue ocean in pancreatic cancer is ready for realization.

Huaxi released a research report stating that the demand-side incremental logic for RAS targets is clear and the global market is expanding rapidly. The industry will enter a concentrated window for clinical data and new product approvals from 2026 to 2027, with continued positive fundamentals. The globalization of domestic pharmaceutical companies' business development is steadily progressing, with three differentiated main lines displaying valuation elasticity. The firm recommends prioritizing platform pharmaceutical companies with both commercial pipelines and cutting-edge G12D/pan-RAS pipelines, as well as comprehensive pharmacies possessing pan-RAS pipelines. Huaxi's main viewpoints are as follows: Technical iteration to Pan-RAS broad targets opens up a layered market space. The RAS target has undergone four generations of technological breakthroughs, completely breaking free from the "non-drugable" constraints and forming a mature three-tier differentiated track of G12C, high elasticity G12D, and long-term growth Pan-RAS, with clear incremental logic on the demand side. KRAS mutations cover 20%-30% of solid tumors, with pancreatic cancer carrying mutations in 80%-90% of cases, nearly 30% of which are G12D, representing a multi-billion yuan blue ocean market for clinical applications without targeted drugs; the NSCLC market is expanding to frontline therapies based on G12C combination therapies, constructing a stable cash flow foundation; colorectal cancer continues to add incremental value as a long-tail market. The global market is expanding rapidly, with a forecast by Sullivan predicting the global market for G12C targeted drugs will reach $490 million in 2024 and $3.49 billion by 2033, with a domestic CAGR of up to 54.2%; G12D inhibitors are expected to reach a global scale of $1.2 billion by 2033, with simultaneous high growth domestically. Technical barriers are being raised layer by layer: four G12C drugs have been launched domestically and included in medical insurance, achieving import substitution; multiple G12D pipelines are entering global Phase III trials, with approval expected by 2028; Pan-RAS broad targets have undergone clinical validation in Phase III by Revolution, reducing the mortality risk for second-line pancreatic cancer by 60%, showing potential for blockbuster drugs. The industry will enter a concentrated window for clinical data and new product approvals from 2026 to 2027, with continued positive fundamentals. Domestic pharmaceutical companies are breaking through in layers, and the three differentiated main lines possess valuation elasticity. Globally, there is a landscape where overseas cutting-edge technologies are leading while domestic companies are advancing comprehensively, forming a clear hierarchy among domestic pharmaceutical companies with three investment lines each having catalysts. The first tier consists of G12C commercialization targets (Eifang Bio, Jinfang Pharma, and JACOBI), with products already included in medical insurance, supported by channel penetration and continued expansion of combination therapies, serving as a source of stable cash flow; the second tier comprises scarce G12D pipelines (Jinfang Pharma, Jiangsu Hengrui Pharmaceuticals, Shanghai Allist Pharmaceuticals Co., Ltd., etc.), with Jinfangs GFH375 and Hengruis HRS-4642 leading globally, pushing forward multiple cancers in Phase III trials while targeting the blank market in pancreatic cancer; the third tier includes Pan-RAS platform companies (Jinfang Pharma, Betta, Beijing Aosaikang Pharmaceutical, BeOne Medicines Ltd., etc.), covering broad target molecular glue and cutting-edge RAS-ADC technologies, enhancing coverage of all mutation types including G12V, NRAS, etc., opening up long-term growth space. At the same time, the globalization of domestic pharmaceutical companies business development continues to take shape, with Jacobi licensing its Pan-KRAS pipeline to AZ and Jinfang authorizing G12D to Verastem, validating the global competitiveness of the pipeline through large overseas transactions, unlocking the second growth curve. In the short term, clinical catalysts are prominent; in the medium to long term, new products' volume production and technological iteration are key. The core short-term catalysts for the industry come from concentrated clinical reads in 2026-2027: G12D pipeline global Phase III topline data for pancreatic cancer and NSCLC, and clinical results from frontline combination therapies of the Pan-RAS pipeline, with data exceeding expectations potentially leading to rapid valuation upside; medium to long-term value relies on the commercialization of new products, with G12D inhibitors expected to fill the gap in pancreatic cancer, with the firm estimating a corresponding domestic market space of around 5 billion yuan, while Pan-RAS drugs will cover the entire population of solid tumor mutations, with a global peak sales potential likely exceeding $10 billion. The firm recommends prioritizing platform pharmaceutical companies with commercial pipelines and cutting-edge G12D/pan-RAS pipelines, as well as comprehensive pharmacies possessing pan-RAS pipelines. Beneficial targets: Jinfang Pharma, Jacobi, Shanghai Allist Pharmaceuticals Co., Ltd., Eifang Bio, Beijing Aosaikang Pharmaceutical, Betta Pharmaceuticals, Yuyuan Pharmaceutical, BeOne Medicines Ltd., Jiangsu Hengrui Pharmaceuticals. Risk warnings: Potential risks include significant price reductions in medical insurance, price competition after product launches, excessive competition in target development, and clinical data not meeting expectations.