Daily Brief Health Care: Celltrion Inc, Xunfei Healthcare Technology, Innovent Biologics Inc, AFT Pharmaceuticals, Oryzon Genomics and more

• In a recent discussion with a client, one of the questions that was raised was regarding the impact the local investors are having on the corporate governance reforms in Korea.
• The number of local investors in the Korean stock market has jumped in the past few years from 5.3 million in 2017 to 14.4 million in 2022.
• All in all, I think Korea is about 3-5 years behind Japan in various corporate governance reforms. So it has a lot of catching up to do.

• Xunfei Healthcare Technology (XHT HK) is looking to raise around US$200m in its upcoming Hong Kong IPO. The bookrunners on the deal are Huatai International, GF Capital, and CCB International.
• Xunfei Healthcare Technology (Xunfei), a iFlytek (Shenzhen-listed) spin-off, primarily provides solutions covering the full healthcare service cycle, with products and services mainly catered towards major stakeholders in the healthcare industry.
• Backed by its healthcare AI solutions matrix, the firm ranked first in the healthcare AI industry in terms of revenue in China in 2022, according to Frost & Sullivan (F&S).

• Innovent’s 2023 product revenue was RMB5.7 billion. In 2024, product revenue growth would remain strong (e.g. 35% YoY).The main flashpoint for performance is after the approval of mazdutide in 2025.
• Innovent has started paving the way for mazdutide more than a year in advance and building various channels.Normally speaking, mazdutide could get the approval in 25Q2. Its CDMO is Asymchem
• Share price of Innovent was once dragged down by the CXO plunge due to the US Draft Bill, but unlike CXOs, innovative drugs do not involve supply chain security issues.

AFT continues to focus on expanding its product portfolio and broadening its geographical footprint (including increased investments in its affiliates), which we expect to translate into stronger market traction and an increased top-line for AFT over the medium term. The company has updated the market on its international growth efforts, announcing new manufacturing agreements for Maxigesic Rapid and Crystaderm (ahead of their expected launches in the US and Chinese markets, respectively) and partnership expansion with Hikma (its US licensee of Maxigesic IV) to commercialise Combogesic IV in Saudi Arabia, Iraq and Jordan. Concurrently, AFT has made inroads into the UK market through the recent launch of Combogesic tablets and IV.

ORY FY23 results announcement covered an eventful period for the company’s pipeline, capped by the release of top-line data from the Phase IIb PORTICO trial for lead CNS asset vafidemstat. With the focus squarely on the planned end of Phase II (EoP2) meeting with the FDA and anticipated clinical updates on the remaining programmes, we see FY24 as a crucial period for the company, with multiple inflection points. Other key upcoming milestones include results from the FRIDA trial (iadademstat in FLT3+ r/r acute myeloid leukaemia; expected in Q224) and a clinical timeline update from the EVOLUTION trial (vafidemstat in schizophrenia; expected in 2024). Based on the current status of the company’s programmes and improved visibility, we have adjusted our market strategy, launch timelines and valuation across the company’s pipeline, leading to a valuation reset to €11.8/share (€15.1/share previously).