Daily Brief Health Care: M3 Inc, Dr. Reddy’s Laboratories, Herbs Generation Group Holdings, Immix Biopharma Inc, Paramount Bed Holdings Co Lt, Thermo Fisher Scientific Inc and more

• M3 Inc (2413 JP) reported 1QFY03/2025 results on Friday. Both revenue and OP for the quarter beat consensus estimates by 3.5% and 11.0% respectively despite earnings continue to decline.
• Medical Platform segment’s earnings have continued to decline as a result of pharma marketing whose revenues are impacted due to spending cuts by pharmaceutical companies.
• M3’s share price has declined by more than 35% YTD and we don’t see any tangible recovery in the company’s earnings as overseas and other businesses face challenges.

• Dr. Reddy’s Laboratories (DRRD IN) had a good start to FY25, with a record high quarterly revenue of INR77B in Q1FY25, beating estimates.
• Increase in base business volume in the U.S. and revenue from Sanofi’s vaccine portfolio in India drove the revenue growth. Higher opex and effective tax rate impacted bottom line.
• The company will split its shares in the ratio of 1:5. This will be first time in last 20 years the company will be splitting its stocks.  

• Herbs Generation’s performance growth momentum is strong, with growth rate of net profit higher than that of revenue. However, net profit margin is not high due to high SG&A expenses. 
• Due to small market size in Hong Kong, growth ceiling of Herbs Generation is obvious. It’s quite challenging to seize market share from top ranking providers due to fierce competition.
• We’re concerned that future revenue could decline to single-digit growth, as the effectiveness of continuing to invest in marketing/promotion will diminish. Valuation of Herbs Generation should be lower than peers.

Immix Biopharma has received a grant of US$8m from the California Institute for Regenerative Medicine (CIRM) to advance clinical development of its lead CAR-T asset, NXC-201, in relapsed/refractory amyloid light chain amyloidosis (r/r ALA). We believe that this backing from the government agency not only bolsters the company’s capital position (cash runway estimated to extend to Q425), but also provides external endorsement of its efforts towards developing the first outpatient CAR-T treatment while addressing the unmet medical need in ALA. We remind readers that Immix recently dosed the first patient in the US as part of the Phase Ib NEXICART-2 trial, which plans to complete enrollment (expected n=40) by end-2025. If the data are supportive, we expect the company to follow it up with a Biologics License Application (BLA) submission to the FDA.

• Revenue: JPY23.1bn (-4.8% YoY), Operating profit: JPY1.6bn (-51.1% YoY), Recurring profit: JPY2.1bn (-48.9% YoY).
• Domestic revenue: JPY20.9bn (-4.0% YoY), Overseas revenue: JPY2.2bn (-11.9% YoY), Medical care business revenue: JPY7.9bn (-13.6% YoY).
• Nursing care business revenue: JPY14.3bn (+2.5% YoY), Health promotion business revenue: JPY2.2bn (-12.2% YoY).

• Thermo Fisher Scientific Inc. recently disclosed their financial results for the second quarter of 2024, which provide a mixed picture, illustrating both strengths and weaknesses in their performance.
• Starting with the positives, Thermo Fisher experienced a solid revenue posting of $10.54 billion for the quarter, alongside an adjusted operating income of $2.35 billion.
• The adjusted operating margin also saw a notable increase to 22.3%, reflecting a refined operational efficiency.