ASCO data set up fruquintinib for China launch

At ASCO, Hutchison China MediTech (HCM) presented detailed Phase III trial results for one of its leading assets, fruquintinib (third-line colorectal cancer). Full data from the China-based FRESCO study demonstrated statistically meaningful improvements in both overall and progression-free survival while reinforcing the safety profile of the drug (no liver toxicity). This is the first full Phase III data readout from HCM and further validates its strategy of creating next-generation selective tyrosine kinase inhibitors (TKIs). HCM’s (together with partner Lilly) NDA to the China FDA has been accepted (Lilly will pay HCM a $4.5m milestone payment) with a launch potentially now in 2018. We maintain our valuation of $2.7bn.