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1、CMB International Global Markets | Equity Research | Company Initiation PLEASE READ THE ANALYST CERTIFICATION AND IMPORTANT DISCLOSURES ON LAST PAGE MORE REPORTS FROM BLOOMBERG: RESP CMBR OR http:/.hk China Healthcare Sector Jill Wu, CFA (852) 3900 0842 .hk Andy Wang (852) 3657 6288 .hk Stock Data M
2、kt Cap (US$mn) 15,347 Avg 3mths t/o (US$mn) 50.78 52w High/Low (US$) 426.56/118.18 Total Issued Shares (mn) 103 Source: Bloomberg Shareholding Structure Amgen 18.45% Baker Bros 11.42% HHLR Advisor 11.02% Capital 8.01% Others 51.10% Source: Company data Share Performance Absolute Relative 1-mth 3.6%
3、13.5% 3-mth -27.0% -7.9% 6-mth -51.0% -30.1% Source: Bloomberg 12-mth Price Performance Source: Bloomberg Auditor: Ernst & Young Web-site: https:/ BUY (Initiation) Target Price US$248.52 Up/Downside +85.77% Current Price US$133.78 17 Jun 2022 1 Global R&D platform as a cornerstone of commercial appr
4、ovals worldwide. BeiGene has demonstrated strong ability in conducting large-scale MRCTs, which is one of the most important competitive advantages of BeiGene as compared to other China biotech companies. BeiGene has a predominately CRO-free R&D and medical affairs team of 3,200+ staff, with 1,000+
5、people outside China. BeiGene has initiated 100+ clinical trials in 45 countries and regions for over 30 medicines and drug candidates since 2013 (including 30+ pivotal or potentially registration-enabling trials), and has enrolled 16,000+ subjects, with around half from outside of China. Rich portf
6、olio of highly innovative assets. With superior response rate, improved PFS and less cardiotoxicity as evidenced by head-to-head studies, zanubrutinib (BTK) has received 22+ global approvals in 50 countries and regions, including the US, China, Europe and others. Tislelizumab (PD-1) was approved in
7、China for nine indications with large indications such as 1L sq-/nsq-NSCLC and 2L HCC covered by the NRDL. Tislelizuamb is also well-positioned for global commercialization thanks to its broad global trials - 11 of tislelizumabs 20+ pivotal trials are conducted globally. BeiGene has 11 clinical-stag
8、e internally discovered drug candidates, including the late-stage asset ociperlimab (TIGIT) and early-stage clinical assets such as BGB-11417 (BCL-2), surzebiclimab (BGB-A425, TIM-3), BGB-A445 (OX40), BGB-10188 (PI3K delta), BGB-15025 (HPK1), BGB-16673 (BTK-targeted CDAC), etc. Ociperlimab is one of
9、 the most advanced TIGIT inhibitors with intact Fc function currently in pivotal stage trials. BGB-11417 appears to be more potent than venetoclax (the only marketed BCL-2 inhibitor globally) and shows the potential to overcome resistance to venetoclax. Entered into harvest season. Powered by a siza
10、ble global commercial team of 3,400+ staff, BeiGene maintained a strong revenue growth momentum. We believe BeiGene has entered into the harvest season, as its product revenue growth outpaces that of its operating expenses (product revenue CAGR of 69% vs operating expense CAGR of 41% during 2018-202
11、1), indicating improving operating cash flows in coming years. Initiate at BUY with TP of US$248.52. We expect zanubrutinib and tislelizumab will continue to be major revenue drivers in coming years. We derive our target price of US$248.52 based on a DCF valuation (WACC: 9.20%, terminal growth rate:
12、 3.0%). Earnings Summary (YE 31 Dec) FY20A FY21A FY22E FY23E FY24E Revenue (US$ mn) 309 1,176 1,398 2,206 3,340 Attributable net loss (US$ mn) (1,597) (1,413) (1,648) (1,136) (272) EPS (US$ per ADS) (22.9) (19.1) (15.2) (16.0) (11.0) Consensus EPS (US$ per ADS) NA NA (11.6) (10.6) (5.1) R&D expenses
13、 (US$ mn) (1,295) (1,459) (1,503) (1,533) (1,548) SG&A expenses (US$ mn) (600) (990) (1,238) (1,337) (1,417) Capex (US$ mn) (118) (263) (320) (100) (100) Current ratio (x) 4.6 4.8 3.5 2.6 2.3 Source: Company data, Bloomberg, CMBIGM estimates BeiGene (BGNE US) Harvest season for a global leading biop
14、harma company 更多投研资料 公众号：mtachn17 Jun 2022 PLEASE READ THE ANALYST CERTIFICATION AND IMPORTANT DISCLOSURES ON LAST PAGE 2 Contents Investment Thesis . 3 Global R&D platform as a cornerstone of commercial approvals worldwide . 3 Strong revenue growth powered by expanding global commercial network . 3
15、 Broad BD collaborations paving the way for global success . 3 Rich portfolio of highly innovative assets . 4 Initiate at BUY with TP of US$248.52 . 5 Investment risks . 5 Growing into world leading biopharma company with a well-established global platform . 6 Global R&D platform as a cornerstone of
16、 wide commercial approvals . 6 Expanding global commercial network to pursue higher sales from markted products . 7 Building global manufacturing facilities to secure product supply . 9 Broad BD collaborations paving the way for global success .10 Rich portfolio of highly innovative assets .13 Next
17、wave of innovation driven by new technology platforms .17 Zanubrutinib: potential BIC BTK inhibitor to unlock global opportunities . 23 Diverse registration approvals worldwide .23 Best-in-class BTKi evidenced by head-to-head studies .24 Strong sales ramp up driven by BeiGenes solid global commercia
18、l capability .31 Irreversible BTKi may continue to dominate the first-line market .34 Tislelizumab: globally developed PD-1 inhibitor with broad labels. 37 Differentiated molecule with broad labels .37 Becoming a top 3 PD-(L)1 player in China thanks to wide NRDL coverage and strong commercial capabi
19、lity .39 Collaborating with Novartis to explore tislelizumabs global potential .42 Ociperlimab: one of the global most advanced anti-TIGIT antibodies . 45 Ociperlimab has differentiated design with intact Fc function .45 TIGIT is a promising IO target despite of setbacks of tiragolumab .49 Internall
20、y developed drug candidates to drive the second wave of innovation . 52 BGB-11417, a potential BIC BCL-2 inhibitor which synergizes with zanubrutinib .52 BGB-445, a differentiated non-ligand competing OX-40 agonist .61 Key in-licensed drug candidates at late clinical stage . 64 Zanidatamab, a dual H
21、ER2-binding bispecific antibody .64 Sitravatinib, a multi-kinase inhibitor at late clinical stage .68 Sotorasib, a first-in-class KRAS G12C inhibitor .70 Financial Analysis . 73 Strong product revenue growth to continue .73 Valuation . 75 Financial Statements . 76 Investment Risks . 77 Appendix: Com
22、pany Profile . 78 更多投研资料 公众号：mtachn17 Jun 2022 PLEASE READ THE ANALYST CERTIFICATION AND IMPORTANT DISCLOSURES ON LAST PAGE 3 Investment Thesis Incorporated in 2010 in Beijing, China, BeiGene has developed into a global, commercial-stage biotechnology company. The Company is the first triple-listed
23、biotechnology company, completed listing on NASDAQ, HKEx and Shanghai STAR Market. Global R&D platform as a cornerstone of commercial approvals worldwide BeiGene has demonstrated strong ability in conducting large-scale MRCTs, which is one of the most important competitive advantages of BeiGene as c
24、ompared to other China biotech companies. BeiGene has 3,200+ R&D and medical affairs staff, including one of the worlds largest oncology research team of 800+ scientists, and an internal clinical development and medical affairs team of 2,400+ staff worldwide, which is predominately CRO-free. BeiGene
25、s R&D and medical affairs team maintains a global operating model, with 1,000+ people outside China. Supported by the world-class global research platform, BeiGene has initiated 100+ clinical trials in 45 countries and regions for over 30 medicines and drug candidates since 2013 (including 30+ pivot
26、al or potentially registration-enabling trials), and has enrolled 16,000+ subjects, with around half from outside of China. Strong revenue growth powered by expanding global commercial network With a growing global commercial team of over 3,400 staff, BeiGene is strengthening its global commercial c
27、apabilities. BeiGene currently has three approved in-house developed medicines, including zanubrutinib, tislelizumab and pamiparib. Zanubrutinib has received approvals in 50 countries, including the US, China, EU, UK, Canada, Australia, etc. Additionally, BeiGene is marketing tislelizumab and pamipa
28、rib and 13 approved in-licensed medicines in China. BeiGene has built a strong, science-based commercial team with over 3,100 staff in China to support a commercial portfolio of 3 in-house developed medicines and 13 in-licensed products. In the US, BeiGene has a commercial team focused on blood canc
29、er market, with an opportunity to expand into solid tumors. BeiGene is also establishing its in-house commercial team in Europe and expanding into Canada, Latin America and other markets through affiliates/partnerships. Thanks to the fast growing commercial portfolio and network, we expect BeiGene t
30、o maintain strong product revenue growth momentum in coming years. The Companys product revenue rallied at a CAGR of 69% during 2018 and 2021. In 1Q22, BeiGenes product revenue reached US$261.6mn, up 146% YoY, mainly driven by the strong sales ramp up of tislelizumab and zanubrutinib. We believe Bei
31、Gene has entered into the harvest season after many years of investment, as its product revenue growth outpaces that of its operating expenses (revenue CAGR of 69% vs operating expense CAGR of 41% during 2018-2021), indicating improving operating cash flows in coming years. Broad BD collaborations p
32、aving the way for global success BeiGene partners broadly with global pharmaceutical and biotech companies to develop and commercialize innovative therapies. The Companys collaboration partners include Novartis, BMS, Amgen, Zymeworks, Mirati, Bio-Thera, etc. The collaborations include out-licenses o
33、f internally developed products to other parties and in-licenses of products and drug candidates from other parties. For out-license collaborations, BeiGene granted Novartis rights for tislelizumab in North America, Europe and Japan through a blockbuster deal in Jan 2021 with a total upfront and mil
34、estone payment up to US$2.2bn. In Dec 2021, BeiGene expanded the collaboration with Novartis to include ociperlimab. BeiGene granted Novartis an exclusive time-based option under which, upon exercise prior to late 2023, the two companies have agreed to jointly develop ociperlimab. The total upfront
35、and milestone payment of the deal was up to US$2.9bn. Through out-license collaborations, BeiGene is able to accelerate the global development and broaden market access of its innovative drugs. More importantly, collaborations with the world leading pharmaceutical companies validated the strength of
36、 BeiGenes internal R&D capabilities and will provide sufficient financial support for BeiGenes further development. 更多投研资料 公众号：mtachn17 Jun 2022 PLEASE READ THE ANALYST CERTIFICATION AND IMPORTANT DISCLOSURES ON LAST PAGE 4 Rich portfolio of highly innovative assets Powered by strong internal R&D ca
37、pabilities and successful business development efforts, BeiGene has established a rich innovative product portfolio of around 50 clinical and commercial assets, including 3 approved internally developed products, 13 approved in-licensed medicines, 11 clinical-stage internally developed drug candidat
38、es, and the remaining of in-licensed drug candidates. Highly differentiated assets developed internally Zanubrutinib, a second-generation BTK inhibitor, is equally or more selective than any approved BTKi, with fewer off-target effects and less cardiotoxicity. Zanubrutinib was shown to have a superi
39、or response rate, an improved PFS and a lower rate of atrial fibrillation/flutter compared with ibrutinib in two head-to-head phase 3 studies. As of May 2022, zanubrutinib has received 22+ approvals for CLL, MZL, MCL, and WM, covering 50 countries and regions, including the US, China, Europe, the UK
40、, Canada, Australia, and others. Zanubrutinib has been recommended by both the NCCN and CSCO guidelines. With the broadest Chinese patient coverage, tislelizumab (PD-1) has been approved in China for nine indications, including 1L sq-NSCLC, 1L nsq-NSCLC, 2/3L NSCLC, 2L cHL, 2L+ PD-L1 positive UC, 2L
41、 HCC, 2L/3L MSI-H/dMMR solid tumors, 2L ESCC and 1L NPC. Tislelizumab is well-positioned for global commercialization thanks to its broad global clinical trials 11 out of tislelizumabs 20+ pivotal trials are conducted globally. As of Feb 2022, tislelizumabs clinical studies have enrolled over 9,000
42、subjects in 35 countries and regions, with over 2,800 from outside of China. Global filings of tislelizumab to the US FDA and EU EMA are currently under review. As of May 2022, BeiGene has 11 clinical-stage internally discovered drug candidates, including the late-stage asset ociperlimab (TIGIT) and
43、 early-stage clinical assets such as BGB-11417 (BCL-2), surzebiclimab (BGB-A425, TIM-3), BGB-A445 (OX40), BGB-10188 (PI3K delta), BGB-15025 (HPK1), BGB-16673 (BTK-targeted CDAC), etc. Ociperlimab is one of the most advanced TIGIT inhibitors with intact Fc function currently in pivotal stage trials.
44、BGB-11417 appears to be more potent than venetoclax (the only marketed BCL-2 inhibitor globally) and shows the potential to overcome resistance to venetoclax. BeiGene aims to start pivotal trials for BGB-11417 in 2022. BeiGene consistently strengthens its in-house R&D capabilities by investing in ne
45、w modalities, such as CDAC, BsAb/TsAb, ADC, Pro-Cytokine, cell therapy, mRNA, etc. Besides the 50 clinical and commercial assets, BeiGene has more than 50 preclinical programs, half with global best-in-class or first-in-class potentials. The Company aims to progress over 10 preclinical candidates to
46、 clinical stage within the next 24 months. We expect the Companys internal discovered pipelines to continue to expand in coming years. Rich portfolio of in-licensed products Leveraging its China commercial capabilities, BeiGene has licensed in 13 commercial medicines and around two dozen clinical-st
47、age drug candidates. The rich commercial-stage in-licensed product portfolio has become an important revenue growth engine for BeiGene. We estimate that in-licensed products delivered approximately US$155mn revenue in 2021, growing by c. 50% YoY and contributing c. 25% of BeiGenes total sales. Aroun
48、d two dozen in-licensed drug candidates are currently under development, among which, sitravatinib, zanidatamab and sotorasib are at late-clinical stage. Sitravatinib is a multi-kinase inhibitor from Mirati. BeiGene is evaluating sitravatinib in multiple clinical trials including a Ph3 trial combini
49、ng sitravatinib with tislelizumab in 2/3L NSCLC. Zanidatamab (HER2-targeted BsAb) is currently in late-stage clinical development. BeiGene is investigating zanidatamab in three ongoing clinical studies with Zymeworks, including a global Ph3 clinical trial examining zanidatamab + chemotherapy +/- tis
50、lelizumab in HER2-positive gastroesophageal cancer. Sotorasib (first-in-class KRAS G12C inhibitor) is the only marketed KRAS G12C inhibitor globally, which was approved in nearly 40 countries. Sotorasib was 更多投研资料 公众号：mtachn17 Jun 2022 PLEASE READ THE ANALYST CERTIFICATION AND IMPORTANT DISCLOSURES