In the days around the U.S. Federal Reserve's policy meeting, the broad market lacks the conditions for a systemic turnaround, but with the ESMO annual meeting and the dense release of third-quarter earnings coinciding, the Hong Kong innovative drug sector may still offer structural opportunities after an oversold period.
Driven by this sector-wide momentum, LONGBIO-B (ASX: 01779) saw a long-awaited single-day surge. With bearish momentum weakening, is a stabilizing trend finally on the horizon? The sharp share price rally on October 28 clearly carried positive short-term significance for LONGBIO-B.
Since joining the Stock Connect program this year, the company's share price volatility has increased notably under the dual influence of market liquidity and swings in the Hong Kong innovative drug sector. In recent months, as the sector entered another correction phase, its PE (TTM) fell back to 28-30 times, sitting at an extremely low historical percentile of 15%-25%. This is not only below the 40-50 times valuation of A-share innovative drug companies but also below U.S. biotech peers, leaving ample valuation safety margin.
Against this backdrop, since September 24, although several oscillators had entered historically oversold territory, the technical rebound demand for LONGBIO-B shares grew increasingly strong in the short term. The recent ignition from sector-wide momentum has given the stock a tendency toward stabilization.
On October 28, Hong Kong innovative drug and CXO names staged a broad recovery, with the innovative drug purity index strengthening intraday and the corresponding ETF recording roughly RMB 100 million in single-day net inflows during the pullback range. The stock opened higher that morning, rising more than 9% within the first 10 minutes of trading. Although gains narrowed significantly afterward—at one point falling to less than 1% in the afternoon—a strong late-session rally lifted the share price back to HK$60.95, closing up 7.59%.
Despite another decline the following day, the significance of the October 28 rally lies in confirming a trend of "weakening bearish momentum." From a technical perspective, over the prior month, LONGBIO-B displayed a textbook bearish setup: a complete bearish moving average alignment, persistent OBV outflow, and extremely thin volume. Even on October 16, there was a notable volume spike accompanied by an extreme upper shadow, underscoring the bleak market sentiment.
However, from October 28 to 29, supported by sector-wide momentum, LONGBIO-B reclaimed its 5-day moving average with a close at HK$60.95, with the intraday low rising—a rare stabilizing signal. On momentum indicators, although the MACD lines remain below the zero axis, the MACD histogram has shown consecutive convergence over the past five trading sessions. On the RSI front, RSI6 has fallen from 27.11 to 23.66, suggesting the stock may be recovering from extreme oversold conditions, with signals of "diminishing downward momentum" beginning to appear.
For now, the October 28 rally has shifted the previously bear-dominated landscape back toward a tug-of-war between bulls and bears. If the share price can stabilize above the 5-day moving average while reclaiming the October 28 intraday high of HK$63.35—further digesting the spike-and-fade pressure from that day—LONGBIO-B could technically confirm a new round of price repair and rebound.
Topline Data Readout: Is Commercialization the Bigger Story?
On October 21, LONGBIO-B announced topline data from its China multicenter Phase II clinical trial of LP-005, a self-developed C5+C3b bispecific antibody fusion protein for treating paroxysmal nocturnal hemoglobinuria (PNH). The study was a multicenter, randomized, open-label design with three dose groups—900mg, 1200mg, and 1500mg—administered via intravenous infusion every four weeks (Q4W) for a total of 48 weeks. The primary endpoints were the change in serum lactate dehydrogenase (LDH) relative to baseline after 12 weeks of treatment and the proportion of patients achieving transfusion independence with a hemoglobin (Hb) increase of at least 2 g/dL from baseline at 24 weeks.
A total of 30 PNH patients were enrolled, with 27 completing 24 weeks of treatment. The study showed that both the 1200mg and 1500mg dose groups achieved a 100% hemolysis control rate (LDH <1.5×ULN) at 12 weeks, demonstrating efficacy on par with first-tier drugs. All three dose groups achieved a 100% transfusion avoidance rate with no breakthrough hemolysis. In the 1500mg group, 85.7% (6/7) of patients achieved an Hb increase of at least 2 g/dL without requiring transfusions at 24 weeks. Regarding safety, no treatment-related serious adverse events (SAEs) were reported, with LP-005 demonstrating favorable overall safety and tolerability.
In response, Guojin Securities noted in a research report that, in a non-head-to-head comparison, LP-005's clinical data appears broadly comparable to the APPOINT-PNH study results (92%/63%) of Novartis's iptacopan, the benchmark for the "proximal oral monotherapy" approach in PNH. LP-005 also offers the convenience advantage of Q4W intravenous dosing. The report suggested that competition in complement drugs is extending from single-target blockade to multi-node intervention, and LP-005's C3b/C5 dual-target layout holds differentiated potential.
Currently, LP-005 is being expanded into complement-mediated kidney disease and periodontitis, with Phase II trials already underway for lupus nephritis, anti-glomerular basement membrane nephritis, and thrombotic microangiopathy, with data readouts expected to follow. On these grounds, although Guojin Securities did not provide a target price in the report, it maintained a "Buy" rating on LONGBIO-B.
On the other hand, the market has already priced in the competitive landscape of the complement space. Guojin Securities cautioned in its report that Jasper's KP104 is also a bispecific complement molecule, and if year-end IgA nephropathy data is positive, it could draw market attention to bispecific complement molecules. In other words, if competitor data proves stronger, it could somewhat weaken expectations for LP-005's future scarcity value.
Judging from secondary market performance after October 21, market participants have clearly not yet traded on the positive impact of LP-005's topline data. This may be because the sector-wide rally coincided with the tail end of the ESMO annual meeting and a dense window of third-quarter earnings disclosures, with the innovative drug sector's advance mainly supported by event catalysts and earnings validation. That is to say, investors' core pricing of innovative drug targets remains focused on commercialization delivery.
For LONGBIO-B, the commercialization pace of its LP-003 anti-IgE antibody is the core pricing anchor at this stage. On August 20 this year, the CDE website showed that the marketing application for LP-003 injection, independently developed by LONGBIO-B, was officially accepted, with the proposed indication being seasonal allergic rhinitis (SAR). This marks the company's first Class 1 innovative biologic drug sprinting toward commercialization.
LP-003, an anti-IgE antibody with a novel sequence design, primarily works by binding with high affinity to free IgE in blood and tissues, blocking its binding to the high-affinity receptor FcεRI, and cutting off the IgE-mediated allergic cascade at its source. Its CSU Phase II head-to-head data outperforming omalizumab further reinforces the thesis that LP-003 possesses differentiated potential.
From a market perspective, allergic rhinitis is a non-infectious chronic inflammation of the nasal mucosa, with China's patient population exceeding 246 million. Although intranasal corticosteroids and second-generation antihistamines are first-line standard treatments, roughly 60% of moderate-to-severe patients still face inadequate efficacy, leaving substantial unmet clinical needs. If approved, LP-003 would become the world's first innovative anti-IgE antibody drug to reach market in the more than 20 years since omalizumab's approval, directly tapping into China's vast allergy treatment market.
Recent institutional views also emphasize LP-003's best-in-class potential and note that the company's revenue elasticity after 2027 will come from LP-003 commercialization. Therefore, the BLA review progress of LP-003 and its subsequent commercialization delivery may be the key catalysts capable of driving LONGBIO-B's share price from stabilization and repair toward a full reversal in the short term.
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