Global Healthcare Analyst

Tina Banerjee

Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/ono-pharmaceutical-co-ltd" target="_blank" data-smartkarma-citation="entities:8979:1" rel="noopener">Ono Pharmaceutical (4528 JP)</a> recorded 13% YoY revenue growth to ¥120B in Q1FY24, driven by 12% YoY growth in product revenue. Royalty revenue grew 14% YoY.</li>
<li>Revenue from Opdivo grew 11% YoY to ¥37.8B, due to expanded use in treatments for gastric cancer, esophageal cancer, urothelial carcinoma, etc. Revenue from Forxiga grew 34% YoY to ¥17.5B.</li>
<li>For FY24, Ono continues to expect revenue growth of 6% to ¥475B. Operating and net profits are expected to increase 8% and 2% to ¥153B and ¥115B, respectively, for FY24.</li>
</ul>



Ono Pharmaceutical (4528 JP) recorded 13% YoY revenue growth to ¥120B in Q1FY24, driven by 12% YoY growth in product revenue. Royalty revenue grew 14% YoY.
Revenue from Opdivo grew 11% YoY to ¥37.8B, due to expanded use in treatments for gastric cancer, esophageal cancer, urothelial carcinoma, etc. Revenue from Forxiga grew 34% YoY to ¥17.5B.
For FY24, Ono continues to expect revenue growth of 6% to ¥475B. Operating and net profits are expected to increase 8% and 2% to ¥153B and ¥115B, respectively, for FY24.


Ono Pharmaceutical (4528 JP): Mixed Q1 Result; Guidance Reiterated; Buyback Plan Announced

Dr. Reddy's Laboratories / Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/dr-reddy-s-laboratories-ltd" target="_blank" data-smartkarma-citation="entities:16406:1" rel="noopener">Dr. Reddy's Laboratories (DRRD IN)</a> started FY24 on a strong note, with Q1FY24 revenue and net profit growing 29% and 18%, YoY, respectively, driven by North America generics business.</li>
<li>Revenue from North America generics increased 79% y/y and 26% q/q to INR32 billion, driven by new product launches, continued momentum in existing products, and favorable forex rates movement.</li>
<li>During Q1FY24, the company has launched six new products in the U.S. With a rich ANDA pipeline of 85 ANDAs, launch momentum is expected to accelerate in the current fiscal.</li>
</ul>



Dr. Reddy's Laboratories (DRRD IN) started FY24 on a strong note, with Q1FY24 revenue and net profit growing 29% and 18%, YoY, respectively, driven by North America generics business.
Revenue from North America generics increased 79% y/y and 26% q/q to INR32 billion, driven by new product launches, continued momentum in existing products, and favorable forex rates movement.
During Q1FY24, the company has launched six new products in the U.S. With a rich ANDA pipeline of 85 ANDAs, launch momentum is expected to accelerate in the current fiscal.


Dr. Reddy's Laboratories (DRRD IN): Q1FY24 Result- US Business Shines; PAT Jumps 18%

<ul>
<li>In FY23, <a href="https://www.smartkarma.com/entities/daiichi-sankyo-co-ltd" target="_blank" data-smartkarma-citation="entities:3014:1" rel="noopener">Daiichi Sankyo (4568 JP)</a> recorded Enhertu product revenue growth of 218% YoY to ¥208B, 4% ahead of forecast, driven by indication expansion and strong market penetration in US.</li>
<li>For FY24, Enhertu product revenue is expected to increase 54% YoY to ¥320B, driven by higher utilization in HER2 positive and HER2 low breast cancer in US.</li>
<li>Daiichi Sankyo has two more drug candidates in late-stage trials for various cancers. Contribution of oncology to total revenue is expected to increase to 45% in FY26 from 20% now.</li>
</ul>


In FY23, Daiichi Sankyo (4568 JP) recorded Enhertu product revenue growth of 218% YoY to ¥208B, 4% ahead of forecast, driven by indication expansion and strong market penetration in US.
For FY24, Enhertu product revenue is expected to increase 54% YoY to ¥320B, driven by higher utilization in HER2 positive and HER2 low breast cancer in US.
Daiichi Sankyo has two more drug candidates in late-stage trials for various cancers. Contribution of oncology to total revenue is expected to increase to 45% in FY26 from 20% now.


Daiichi Sankyo (4568 JP): Strong Beneficiary of Cancer Drug Enhertu; High Hope for Research Pipeline

Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

iShares MSCI ACWI ETF / Technical Analysis

<ul>
<li>There continues to be little traction above $93 on MSCI ACWI (ACWI-US), which remains the top-end of our anticipated 2023 trading range. Important downside targets are $86, $84, and $75-77.</li>
<li>Additionally, the EURO STOXX 50 remains below 2-year resistance at 4400-4415.</li>
<li>We remain overweight Europe, Japan, and India, and we prefer to only add exposure on a pullback -- especially in Japan where indexes are bullish yet extended.</li>
</ul>


There continues to be little traction above $93 on MSCI ACWI (ACWI-US), which remains the top-end of our anticipated 2023 trading range. Important downside targets are $86, $84, and $75-77.
Additionally, the EURO STOXX 50 remains below 2-year resistance at 4400-4415.
We remain overweight Europe, Japan, and India, and we prefer to only add exposure on a pullback -- especially in Japan where indexes are bullish yet extended.


No Traction Above $93 on ACWI-US or 4400-4415 on EURO STOXX 50. Buys in Defensives/Japan/EM

TSE Tokyo Price Index TOPIX / Technical Analysis

<ul>
<li>We continue to recommend a tactical overweight to defensives (Staples, Health Care, and Utilities) as the MSCI ACWI (ACWI-US) tests the top-end of our anticipated 2023 trading range at $93.</li>
<li>We also remain overweight Europe, Japan, and India, where a lot more than just defensives continue to outperform.</li>
<li>Actionable Themes: Consumer Discretionary and Defensives, Mainly in Japan and Europe</li>
</ul>


We continue to recommend a tactical overweight to defensives (Staples, Health Care, and Utilities) as the MSCI ACWI (ACWI-US) tests the top-end of our anticipated 2023 trading range at $93.
We also remain overweight Europe, Japan, and India, where a lot more than just defensives continue to outperform.
Actionable Themes: Consumer Discretionary and Defensives, Mainly in Japan and Europe


Remain Overweight Japan, Europe, & India; Buys in Discretionary and Defensives W/ Japan/Europe Focus

Japan

Astellas Pharma Inc. is a pharmaceutical company committed to the therapeutic fields of Urology, Immunology including Transplantation and Infectious Diseases, Oncology, Neuroscience and DM Complications and Metabolic Diseases. With over 17,000 global employees, Astellas researches, develops, manufactures, and promotes its prescription drugs through subsidiaries in the US, Europe, and Asia

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Astellas Pharma (4503 JP)

Ono Pharmaceutical (4528 JP): Mixed Q1 Result; Guidance Reiterated; Buyback Plan Announced

Ono recorded 13% YoY revenue growth to ¥120B in Q1FY24, driven by 12% YoY growth in product revenue. Lead drug, Opdivo reported 11% sales growth....

Tina Banerjee

Dr. Reddy's Laboratories (DRRD IN): Q1FY24 Result- US Business Shines; PAT Jumps 18%

North America sales grew 79% y/y and 26% q/q to INR32 billion, driven by new product launches, continued momentum in existing products, favorable...

Tina Banerjee

Daiichi Sankyo (4568 JP): Strong Beneficiary of Cancer Drug Enhertu; High Hope for Research Pipeline

Enhertu has gained blockbuster status by recording $1B+ revenue in FY23. Enhertu plus other potential cancer drug launches should contribute 45%...

Tina Banerjee

No Traction Above $93 on ACWI-US or 4400-4415 on EURO STOXX 50. Buys in Defensives/Japan/EM

No Traction Above $93 on MSCI $ACWI or 4400-4415 on EURO #STOXX 50. Continues to reinforce our view from early-January that $93 on ACWI caps upside...

Vermilion Research

Remain Overweight Japan, Europe, & India; Buys in Discretionary and Defensives W/ Japan/Europe Focus

We continue to recommend a tactical overweight to defensives as $ACWI tests the top-end of our anticipated 2023 trading range at $93. Remain...

Vermilion Research

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