Multiple innovative assets with global blockbuster potential
Multiple innovative assets with global blockbuster potential Hansoh has demonstrated a strong track record of revenue growth and earningsdelivery,supported by sustained robust momentum in innovative drug sales. Asaleading biopharma in China,Hansoh’s consistent commitment to R&Dinvestment is entering a harvest period, reflectedby itscontinuoushigh-valueout-licensing partnerships and promising PoC readouts from differentiatedpipeline assets. We maintain BUY rating on Hansoh, with aTPof HK$47.19. Target PriceHK$47.19(Previous TPHK$46.41)Up/Downside41.7%Current PriceHK$33.30 Innovative drugsmaintain strong growth momentum.Hansoh hascontinued to deliver solid top-line expansion in recent years, underpinnedby sustained momentum from aumolertinib and other innovative products.ExcludingBD revenue, innovative drug sales in FY25 recorded stronggrowth of30% YoY. For FY26, management has guided to double-digitrevenue growth, while innovative drug revenue excluding BDis expected togrow at close to 20%.Management has also indicated anambition foraumolertinib sales to reach RMB8bn by 2030, with incremental upsidepotentially coming from combination strategies, including usein combinationwitha c-MET inhibitor and an EGFR/c-METbsAb.The development of afourth-generation EGFR TKI could further extend the franchise lifecycle. China HealthcareJill WU, CFA(852) 3900 0842jillwu@cmbi.com.hk Andy WANG(852) 3657 6288andywang@cmbi.com.hk BD income tobecomea long-term earnings contributor.Hansoh hasmaintained a strong commitment to R&D investment, with R&D expensesincreasingat a CAGR of 23%from2020 to 2026E.Hansohhas more than40clinical-stage innovative assets and aims to advance 8–10 newmolecules into clinical stageeach year.The companyhas demonstratedsolid innovation capabilities through a consistent record of out-licensingtransactions with global pharmaceutical partners, including GSK, Roche,Regeneron, MSD, and Glenmark.Backed by strong and efficient R&Dexecution,we expectout-licensingBD income to become an increasinglyrecurring and meaningful long-termearnings contributorfor Hansoh. Source: FactSet Source: HKEx Multiple programs have global blockbuster potential.HS-20093 (B7-H3ADC) hasshownencouraging activity across ES-SCLC, CRPC, NSCLC,and othertumors, with particularly compelling PFS in IO-resistant nsq-NSCLC whencombined with a PD-L1 mAb.GSK plansaggressivelyto startglobal Phase 3 trials in 1L ES-SCLC, late-line mCRPC, and chemo-naïvemCRPC in 2H26, followed by mHSPC and 2L NSCLC in 2027, and 1LNSCLC in 2028.GSK isalsorapidlyadvancing HS-20089 (B7-H4 ADC)intofive global Phase3gynecological cancertrialsin2026.Hansoh’sbroadGLP-1 portfolio is led by NDA-stage HS-20094 (GLP-1/GIP), whichhasshownstrong weight loss,with particularly favorable gastrointestinaltolerability.HS-20118, adifferentiated oral IL-23 asset with the potentialadvantageof once-weekly dosing,offers strategic upside for Hansohthrough a NewCo structure.We believe Hansoh’sdivsesepipeline alsoholds global BD potential, including a 4th-gen EGFR TKI, MET/EGFR ADC,KRAS G12D inhibitor, SEZ6 ADC, oral PCSK9, OX2R, and P2X3 assets. Source: FactSet Maintain BUY.We remain confident in Hansoh’s ability to deliver itsguidance and the long-term value of innovative drug pipelines.WerevisittheWACC assumptions in light of recent market dynamicsandreviseourTPfrom HK$46.41to HK$47.19,(WACC8.48%,terminal growth rate4.0%).Earnings Summary Content Hansoh Pharma (3692 HK)-Multiple innovative assets with globalblockbuster potential...............................................................................1Innovative drugs maintain strong sales growth momentum................3Diversified innovative product pipeline with global potential..............4Strongcommitment to R&D investments.....................................................................4Successful out-licensing BD track records...................................................................5Rich pipeline catalysts across late-stage and proof-of-concept programs.....................6Highly differentiated pipelines enabling long-term growth..................6HS-20093/Ris-rez (B7-H3 ADC), a key global-value driver for Hansoh while emergingas GSK’s backbone oncology asset............................................................................7HS-20089/Mo-Rez (B7-H4 ADC) is in multiple globalPhase 3 trials for gynecologicalcancers.....................................................................................................................13HS-10504: a differentiated fourth-generation EGFR TKI with potential to address a keypost-osimertinib resistance niche..............................................................................15GLP-1 portfolio: broad platform with multiple shots on goal........................................16Autoimmune pipeline shows broad promise with oral IL-23 being a potentialblockbuster................................................................................