Healthcare equity analyst - emerging & dev mkts, daaimon

Avien Pillay

Healthcare equity analyst - emerging & dev mkts

daaimon

daaimon is an independent research company focusing on healthcare and consumer sectors across developed and emerging markets. We produce insightful research which challenges conventional thinking. In particular, we look for new ideas by testing consensus forecasts and markets expectations.

Equity Bottom-Up

<ul>
<li>FDA approval of Wegovy is overvalued at approx. $460 billion. Market exaggerated the worth without proper assessment of weight loss results and risks associated with the drug.</li>
<li>Clinical trials showed a 14.9% weight loss with diet and exercise; real-world results would be lower. Impact on BMI for obese individuals won't be significant. Long-term use is questionable.</li>
<li>Competition in the GLP-1 market is fierce. Novo Nordisk faces challenges in India and China, increased capex spending, and risks from compounding pharmacies and potential legal issues.</li>
</ul>


FDA approval of Wegovy is overvalued at approx. $460 billion. Market exaggerated the worth without proper assessment of weight loss results and risks associated with the drug.
Clinical trials showed a 14.9% weight loss with diet and exercise; real-world results would be lower. Impact on BMI for obese individuals won't be significant. Long-term use is questionable.
Competition in the GLP-1 market is fierce. Novo Nordisk faces challenges in India and China, increased capex spending, and risks from compounding pharmacies and potential legal issues.


Novo Nordisk: Is the FDA Approval of Wegovy Worth an Extra $460 Bn?

Innovent Biologics Inc / Equity Bottom-Up

<ul>
<li>Innovent is most well-known as the developer of mazdutide in China, however this is overshadowing a strong portfolio of oncology drugs in a very high growth market.</li>
<li>China’s approach to healthcare is being defined by having the biggest diabetic population, over 4 million new cancer cases per year, and over 100 million living with obesity.</li>
<li>We expect the valuation gap between the two first-to-market GLP-1 drugs, and competition to close. Oncology drug sales and valuations will continue its growth trajectory.</li>
</ul>


Innovent is most well-known as the developer of mazdutide in China, however this is overshadowing a strong portfolio of oncology drugs in a very high growth market.
China’s approach to healthcare is being defined by having the biggest diabetic population, over 4 million new cancer cases per year, and over 100 million living with obesity.
We expect the valuation gap between the two first-to-market GLP-1 drugs, and competition to close. Oncology drug sales and valuations will continue its growth trajectory.


Innovent Biologics(1801 HK)– More than Just a GLP-1 Play

Thematic (Sector/Industry)

<ul>
<li>The obesity problem has escalated at an alarming rate in Asia. </li>
<li>Expect strong growth for GLP-1s over the next few years, however, companies that produce next-generation drugs will take the lead.</li>
<li>The significant increase in newly approved drugs will result in margin pressure - pricing will be key.</li>
</ul>


The obesity problem has escalated at an alarming rate in Asia. 
Expect strong growth for GLP-1s over the next few years, however, companies that produce next-generation drugs will take the lead.
The significant increase in newly approved drugs will result in margin pressure - pricing will be key.


HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

<ul>
<li>Innovent’s 24H1 product revenue exceeded RMB3.7 billion.Due to anti-corruption campaign, newly marketed PD-1s are unable to be admitted to the hospitals normally, which indirectly promotes the sales performance of sintilimab.</li>
<li>2024 full-year product revenue is estimated to reach RMB7.7 billion. IBI363 has the potential to be blockbuster variety in global markets, which may put Innovent’s valuation on a new level.</li>
<li>Innovent is undervalued if market value is below RMB38.5 billion.If mazdutide is able to contribute RMB10 billion sales, Innovent’s market value would reach about RMB90-100 billion (based on 5 P/S).</li>
</ul>


Innovent’s 24H1 product revenue exceeded RMB3.7 billion.Due to anti-corruption campaign, newly marketed PD-1s are unable to be admitted to the hospitals normally, which indirectly promotes the sales performance of sintilimab.
2024 full-year product revenue is estimated to reach RMB7.7 billion. IBI363 has the potential to be blockbuster variety in global markets, which may put Innovent’s valuation on a new level.
Innovent is undervalued if market value is below RMB38.5 billion.If mazdutide is able to contribute RMB10 billion sales, Innovent’s market value would reach about RMB90-100 billion (based on 5 P/S).


2024 High Conviction Update: Innovent (1801.HK) 24Q2 - Valuation Upside Will Be Further Opened Up

Global Healthcare Analyst

Tina Banerjee

<ul>
<li>On July 2, <a href="https://www.smartkarma.com/entities/eli-lilly-co" target="_blank" data-smartkarma-citation="entities:19419:1" rel="noopener">Eli Lilly &amp; Co (LLY US)</a> has received FDA approval for its Alzheimer’s disease drug Kisunla, which will compete head-on-head with <a href="https://www.smartkarma.com/entities/eisai-co-ltd" target="_blank" data-smartkarma-citation="entities:21001:1" rel="noopener">Eisai Co Ltd (4523 JP)</a>'s Leqembi.  </li>
<li>Efficacy and indications of both the drugs are similar. Price comparison is tricky. However, Kisunla can be stopped when amyloid plaques are removed, which is not the case for Leqembi.</li>
<li>Eisai is not expected to face immediate competition and should comfortably meet Leqembi FY25 revenue target of ¥56.5B, including ¥43.5B from the U.S. Recently, Leqembi has been launched in China.</li>
</ul>


On July 2, Eli Lilly &amp; Co (LLY US) has received FDA approval for its Alzheimer’s disease drug Kisunla, which will compete head-on-head with Eisai Co Ltd (4523 JP)'s Leqembi.  
Efficacy and indications of both the drugs are similar. Price comparison is tricky. However, Kisunla can be stopped when amyloid plaques are removed, which is not the case for Leqembi.
Eisai is not expected to face immediate competition and should comfortably meet Leqembi FY25 revenue target of ¥56.5B, including ¥43.5B from the U.S. Recently, Leqembi has been launched in China.


Eisai Co Ltd (4523 JP): New Competition Is Coming for Alzheimer’s Disease Drug; No Immediate Threat

United States

Eli Lilly and Company discovers, develops, manufactures, and sells pharmaceutical products for humans and animals. The Company products are sold in countries around the world. Eli Lilly products include neuroscience, endocrine, anti-infectives, cardiovascular agents, oncology, and animal health products.

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Eli Lilly & (LLY UN)

Novo Nordisk: Is the FDA Approval of Wegovy Worth an Extra $460 Bn?

In light of the bullish Innovent report, and the ongoing news about new GLP-1s in the pipeline, this "Novo Nordisk - critical analysis" provides a...

Avien Pillay

Innovent Biologics(1801 HK)– More than Just a GLP-1 Play

Mazdutide's strong results will position it well against the competition, and the valuation gap will narrow. The oncology portfolio will continue...

Avien Pillay

The GLP-1 Landscape in Asia

First-gen GLP-1 impact may fall short of hype, demand still strong. Next-gen drugs promise better results, tolerance, price. Expect margin pressure...

Avien Pillay

2024 High Conviction Update: Innovent (1801.HK) 24Q2 - Valuation Upside Will Be Further Opened Up

Innovent's revenue growth in 24H1 was commendable. IBI363 has the potential to be blockbuster drug in global markets. Market value to reach above...

Xinyao (Criss) Wang

Eisai Co Ltd (4523 JP): New Competition Is Coming for Alzheimer’s Disease Drug; No Immediate Threat

FDA approves Eli Lilly's Alzheimer's disease drug Kisunla. However, Eisai is not expected to face immediate competition and is expected to meet...

Tina Banerjee

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Novo Nordisk: Is the FDA Approval of Wegovy Worth an Extra $460 Bn?

In light of the bullish Innovent report, and the ongoing news about new GLP-1s in the pipeline, this "Novo Nordisk - critical analysis" provides a...

Avien Pillay

Innovent Biologics(1801 HK)– More than Just a GLP-1 Play

Mazdutide's strong results will position it well against the competition, and the valuation gap will narrow. The oncology portfolio will continue...

Avien Pillay

The GLP-1 Landscape in Asia

First-gen GLP-1 impact may fall short of hype, demand still strong. Next-gen drugs promise better results, tolerance, price. Expect margin pressure...

Avien Pillay

2024 High Conviction Update: Innovent (1801.HK) 24Q2 - Valuation Upside Will Be Further Opened Up

​Innovent's revenue growth in 24H1 was commendable. IBI363 has the potential to be blockbuster drug in global markets. Market value to reach above...

Xinyao (Criss) Wang

Eisai Co Ltd (4523 JP): New Competition Is Coming for Alzheimer’s Disease Drug; No Immediate Threat

​FDA approves Eli Lilly's Alzheimer's disease drug Kisunla. However, Eisai is not expected to face immediate competition and is expected to meet...

Tina Banerjee

Innovent's revenue growth in 24H1 was commendable. IBI363 has the potential to be blockbuster drug in global markets. Market value to reach above...

FDA approves Eli Lilly's Alzheimer's disease drug Kisunla. However, Eisai is not expected to face immediate competition and is expected to meet...