Blue Lotus China New Economy Research, Blue Lotus Research Institute

Eric Wen

Blue Lotus China New Economy Research

China growth and global non-US Internet equities

Blue Lotus Research Institute

Blue Lotus Research is a Hong Kong Type 4 Licensed investment advisory firm focusing on Chinese growth equities and global non-US Internet equities

Equity Bottom-Up

<ul>
<li>C1Q24 was marked by liquidity crises in innovative drug and medical device, and depressed margin in digital health. We believe this is a buying opportunity;</li>
<li>PD-1 has recovered nicely in C2H23 and exceeded our expectation made for 2023.We forecast 20% YoY growth in 2024.Further,pipeline maturity has led to new drugs in autoimmune and metabolic drugs;</li>
<li>Biosimilar has proven to be part of the solution to deal with low paying ability of Chinese healthcare and denial of access to the high paying US healthcare market. </li>
</ul>


C1Q24 was marked by liquidity crises in innovative drug and medical device, and depressed margin in digital health. We believe this is a buying opportunity;
PD-1 has recovered nicely in C2H23 and exceeded our expectation made for 2023.We forecast 20% YoY growth in 2024.Further,pipeline maturity has led to new drugs in autoimmune and metabolic drugs;
Biosimilar has proven to be part of the solution to deal with low paying ability of Chinese healthcare and denial of access to the high paying US healthcare market. 


[Blue Lotus Healthcare Sector Update]: Bottom-Fishing at the Bottom of the Business Cycle

HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

<ul>
<li>There’re rumor that Akeso’s AK112 and AK104 2024 revenue is RMB300 million and RMB1.5-1.6 billion respectively. Sales of AK104 may be below expectations, so Akeso decided to enter NRDL reimbursement.</li>
<li>Regardless of whether there is a takeover offer, reasonable valuation of Legend Bio is between US$12.5bn-US$15bn based on solid fundamentals. This deal is “a test” for the management of Genscript.</li>
<li>Current stock price of InnoCare just reflects its essence. If no new catalysts (e.g. breakthroughs in clinical data, new licensing agreement, etc.), we are not optimistic about the prospects of InnoCare.</li>
</ul>


There’re rumor that Akeso’s AK112 and AK104 2024 revenue is RMB300 million and RMB1.5-1.6 billion respectively. Sales of AK104 may be below expectations, so Akeso decided to enter NRDL reimbursement.
Regardless of whether there is a takeover offer, reasonable valuation of Legend Bio is between US$12.5bn-US$15bn based on solid fundamentals. This deal is “a test” for the management of Genscript.
Current stock price of InnoCare just reflects its essence. If no new catalysts (e.g. breakthroughs in clinical data, new licensing agreement, etc.), we are not optimistic about the prospects of InnoCare.


China Healthcare Weekly (July.21)-Rumor About Akeso, Takeover Bid for Legend Bio, InnoCare's Trouble

APAC IPOs & Placements, Aequitas Research

Clarence Chu

APAC IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Equity Capital Markets

Akeso Biopharma Inc / Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/akeso-biopharma-inc" target="_blank" data-smartkarma-citation="entities:28830:1" rel="noopener">Akeso Biopharma Inc (9926 HK)</a> is looking to raise US$155m from its primary placement.</li>
<li>Proceeds from the deal would be geared towards R&amp;D expenditure for its preclinical programs, expediting clinical trials, and towards commercializing its existing approved products.</li>
<li>Accounting for 3% of shares outstanding, and representing 5.7 days of its three month ADV, the deal would be a relatively small one for the firm to digest.</li>
</ul>



Akeso Biopharma Inc (9926 HK) is looking to raise US$155m from its primary placement.
Proceeds from the deal would be geared towards R&amp;D expenditure for its preclinical programs, expediting clinical trials, and towards commercializing its existing approved products.
Accounting for 3% of shares outstanding, and representing 5.7 days of its three month ADV, the deal would be a relatively small one for the firm to digest.


Akeso Inc Placement - A Small One to Digest, Momentum Has Been Strong

<ul>
<li>China’s innovative drug sector remains a liquidity driven sector, as investible choices are limited, which include Akeso and BeiGene as our BUY ideas. </li>
<li>We also notice positive change in Innovent but opt to keep rating unchanged;</li>
<li>We upgrade BeiGene from SELL to BUY and maintain SELL on RemeGen, Innovent, JUNSHI and ZaiLab. We discontinued coverage on Legend Biotech.</li>
</ul>


China’s innovative drug sector remains a liquidity driven sector, as investible choices are limited, which include Akeso and BeiGene as our BUY ideas. 
We also notice positive change in Innovent but opt to keep rating unchanged;
We upgrade BeiGene from SELL to BUY and maintain SELL on RemeGen, Innovent, JUNSHI and ZaiLab. We discontinued coverage on Legend Biotech.


[Blue Lotus Sector Update]: Solid Companies Starting to Rise from the Ashes

Sichuan Kelun-Biotech Biopharm / Equity Bottom-Up

<ul>
<li>The imagination space and good stories for <a href="https://www.smartkarma.com/entities/sichuan-kelun-biotech-biopharm" target="_blank" data-smartkarma-citation="entities:40071:1" rel="noopener">Sichuan Kelun-Biotech Biopharm (6990 HK)</a> at this stage mainly come from SKB264. The market has higher expectations for SKB264’s clinical data on NSCLC/TNBC. </li>
<li>The better the clinical results of SKB264 +PD1/L1, the greater the negative impact on AK112’s future expectations/market space in NSCLC. ADC +PD-1 seems more “convincing” than the logic of BsAb.</li>
<li>This July, restricted shares of major shareholders will be lifted, which may lead to big share price fluctuation if they reduce their shareholdings. Investors need not rush to be long.</li>
</ul>


The imagination space and good stories for Sichuan Kelun-Biotech Biopharm (6990 HK) at this stage mainly come from SKB264. The market has higher expectations for SKB264’s clinical data on NSCLC/TNBC. 
The better the clinical results of SKB264 +PD1/L1, the greater the negative impact on AK112’s future expectations/market space in NSCLC. ADC +PD-1 seems more “convincing” than the logic of BsAb.
This July, restricted shares of major shareholders will be lifted, which may lead to big share price fluctuation if they reduce their shareholdings. Investors need not rush to be long.


Sichuan Kelun-Biotech Biopharm (6990.HK) - Current High Valuation Is Not Secure

China

Akeso Inc. operates operatesa s a biotech company. The compnay develops treatments and therapies for various types of diseases. Akeso serves cutomers worldwide

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

Akeso Biopharma Inc (9926 HK)

[Blue Lotus Healthcare Sector Update]: Bottom-Fishing at the Bottom of the Business Cycle

Liquidity crises in healthcare innovation present buying opportunity;PD-1 exceeds expectations with 20%YoY growth forecast for 2024;Biosimilars...

Blue Lotus Research Institute

China Healthcare Weekly (July.21)-Rumor About Akeso, Takeover Bid for Legend Bio, InnoCare's Trouble

Revenue of Akeso's AK112 and AK104 in 2024 may fall short of expectations. Legend Bio got a takeover bid, which is "a test" for Genscript....

Xinyao (Criss) Wang

Akeso Inc Placement - A Small One to Digest, Momentum Has Been Strong

Akeso Biopharma Inc (9926 HK) is looking to raise US$155m from its primary placement. Representing 5.7 days of its three month ADV, the deal would...

Clarence Chu

[Blue Lotus Sector Update]: Solid Companies Starting to Rise from the Ashes

China's drug sector is driven by liquidity, with limited investment choices. Akeso and BeiGene are recommended as buy options, while RemeGen,...

Blue Lotus Research Institute

Sichuan Kelun-Biotech Biopharm (6990.HK) - Current High Valuation Is Not Secure

The market has high hopes for SKB264's clinical data on NSCLC/TNBC, which will impact Akeso's future expectations. Be cautious of share price...

Xinyao (Criss) Wang

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

[Blue Lotus Healthcare Sector Update]: Bottom-Fishing at the Bottom of the Business Cycle

​Liquidity crises in healthcare innovation present buying opportunity;PD-1 exceeds expectations with 20%YoY growth forecast for 2024;Biosimilars...

Blue Lotus Research Institute

China Healthcare Weekly (July.21)-Rumor About Akeso, Takeover Bid for Legend Bio, InnoCare's Trouble

​Revenue of Akeso's AK112 and AK104 in 2024 may fall short of expectations. Legend Bio got a takeover bid, which is "a test" for Genscript....

Xinyao (Criss) Wang

Akeso Inc Placement - A Small One to Digest, Momentum Has Been Strong

Akeso Biopharma Inc (9926 HK) is looking to raise US$155m from its primary placement. Representing 5.7 days of its three month ADV, the deal would...

Clarence Chu

[Blue Lotus Sector Update]: Solid Companies Starting to Rise from the Ashes

​China's drug sector is driven by liquidity, with limited investment choices. Akeso and BeiGene are recommended as buy options, while RemeGen,...

Blue Lotus Research Institute

Sichuan Kelun-Biotech Biopharm (6990.HK) - Current High Valuation Is Not Secure

The market has high hopes for SKB264's clinical data on NSCLC/TNBC, which will impact Akeso's future expectations. Be cautious of share price...

Xinyao (Criss) Wang

Liquidity crises in healthcare innovation present buying opportunity;PD-1 exceeds expectations with 20%YoY growth forecast for 2024;Biosimilars...

Revenue of Akeso's AK112 and AK104 in 2024 may fall short of expectations. Legend Bio got a takeover bid, which is "a test" for Genscript....

China's drug sector is driven by liquidity, with limited investment choices. Akeso and BeiGene are recommended as buy options, while RemeGen,...