Guoyuan International has issued a research report assigning CSPC PHARMA (01093) a "Buy" rating with a target price of HK$10.11. The company is actively expanding its innovative drug portfolio, increasing R&D investments, and achieving notable success in overseas markets. Despite short-term pressure on its pharmaceutical business due to centralized procurement policies, quarterly performance has shown signs of stabilization and recovery. Several core innovative drugs are approaching critical milestones, and licensing revenue has emerged as a new growth driver, laying a solid foundation for medium-to-long-term growth.
Key highlights from Guoyuan International’s report include:
**Increased R&D Investment and Strong Platform Advantages** CSPC PHARMA has established an international R&D team of over 2,000 professionals, focusing on oncology, neuropsychiatry, and cardiovascular therapeutics, supported by eight major R&D platforms. R&D expenses reached RMB 4.185 billion, up 7.9% YoY, accounting for 27.1% of pharmaceutical revenue. Nearly 90 products are in various clinical trial stages, with 14 under regulatory review and over 30 in registration trials. The company plans to submit nearly 50 new drugs or new indications for approval within the next five years.
**Rapid Progress in Innovative Drug Development and Overseas Expansion** The company’s innovative pipeline is accelerating, with licensing revenue contributing RMB 1.54 billion as a new growth driver. Cumulative potential milestone payments from overseas licensing agreements exceed $15 billion, reflecting early success in its global strategy. Eight key products, including SYS6091 (HER2 ADC), SYS6010 (EGFR ADC), Anituo Monoclonal Antibody (HER2 bispecific), and SYS6093 (TSLP monoclonal antibody), are in pivotal clinical stages, with data readouts and regulatory submissions expected between 2025 and 2027. SYS6010 (EGFR ADC) has received three FDA Fast Track designations and NMPA Breakthrough Therapy status for EGFR-mutated NSCLC post-TKI and platinum-based chemotherapy failure. Phase III trials are underway, with potential commercialization in 2026. The siRNA pipeline, targeting PCSK9, AGT, and LP(a), demonstrates technological leadership.
**Quarterly Performance Recovery** For the first three quarters of 2025, revenue declined 12.3% YoY to RMB 19.891 billion, while net profit fell 7.06% to RMB 3.511 billion, primarily due to centralized procurement and price cuts in the pharmaceutical segment (revenue down 17.2% to RMB 15.45 billion). However, Q3 revenue rose 3.4% YoY and 5.7% QoQ to RMB 6.62 billion, with net profit up 27.2% to RMB 960 million. The company aims to drive growth through new product launches and its robust commercialization and management teams.
**Risk Factors** Potential delays in new drug development, slower-than-expected commercialization, and unforeseen complexities in global markets may hinder international expansion of innovative drugs.
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