DG, you recently posted on HCM bb of another website about couple more Chinese bio pharmaceutical company applying to trade on Hong Kongs stock market. Out of curiosity, I checked one of those , Innovent biopharms website. It has picture of a huge and attractive building. They too are working on anti malignancy drug candidate/s in addition to chronic inflammatory conditions like Rh.Arthritis. Ely Lilly is mentioned as a partner. They have a drug in phase 3 trial. I couldnt get any further details as the links lead to mandarin script pages. The company is letting their infrastructure facilities to other pharmaceutical companies.
If you happen to find any useful information please let us know. Just wondering if its another chi-med in its toddler stages. Thanks
2 separate very reliable sources have told me recently that they have been approached by parties looking to buy very large quantities of shares and both have declined to sell. At the moment one can buy small quantities without a problem but buying 100's of thousands or millions is not possible. Holders are not willing to sell, which sends a strong message...in the meantime I continue to buy
It has been 30 years since a Chinese company last launched a globally commercialised medicine, but Hutchison China Meditech (HCM) is on the cusp of changing that. Its novel cancer drug, Savolitinib, is in the closing stages of a final phase clinical trial which analysts think has a 75 per cent chance of success. If it gets the green light from regulators, Savolitinib will be used to treat kidney cancer, while further testing might give it the potential to be used in non-small cell lung cancer patients as well.
After 20 years of steady investment in research and development, clinical success has come thick and fast in the last 18 months. Aside from the Savolitinib trial, Chi-Med has seven final phase programmes ongoing in four different drugs which analysts think could generate peak annual sales of $7.6bn. The most advanced of these is colorectal cancer treatment, Fruquintinib, which could be launched in China later this year.
Arguably more important is the depth in the early- and mid-stage pipeline, which gives the group an excellent long-term outlook. There are five oncology medicines currently undergoing early-stage human trials, which should be launched between 2020 and 2023 and a further five in pre-clinical studies. Chi-Med is certainly not a one-trick pony looking to develop and divest novel drugs, but a fast-growing commercial biotech company with a long line of new medicines which should keep the top line growing for many years.
The group£s commercial arm in China is well established and will provide an excellent platform to sell medicines once they gain approval. It also generates cash to fund the drug development branch, while a recent $293m fundraise from the group£s Nasdaq investors has strengthened the balance sheet.
The innovation division also earns money for Chi-Med in the form of milestone payments, notably from big pharma groups Eli Lilly and AstraZeneca, which the group has partnered with to develop Fruquintinib and Savolitinib, respectively. The group will continue to receive one-off payments throughout the development stage and then royalties on the drugs£ sales.
Profits may still be some way off (which makes valuing Chi-Med very difficult), but we think the plethora of potential drug launches should give plenty of firepower to the share price in the next few years. The Chinese healthcare market is also becoming increasingly attractive as doctors and pharma companies seek to match their western counterparts. Buy. MB
hi sporty, just returned from the excellent AGM in Battersea, always a great event hosted by the superb Management Team....
Chi-Med believes the future of immunotherapy lies in combination treatments. Tagrisso is a EGFR drug which is already approved in first line treatment for NSCLC. It is also now being trialed in combination with Savolitinib and if successful, which the data so far suggests it will be, Savolitinib could get Breakthrough Therapy Designation as a combination therapy. Savolitinib could be used as a standalone therapy but its success lies as a combination, which is why Tagrisso's approval was so important.
Thanks for posting last two messages.
For the benefit of newcomers to HCM boards,
is it possible for you to briefly explain tagrissos importance to HCM and savolitinib getting highlighted in AstraZenecas report.
Bernie, my understanding is that they have a similar drug in development that would effectively compete with Fruquintinib for certain indications, which is why they may end up competing against themselves.
However, now we are setting up our own presence in the United States, and will be able to liaise directly with the FDA using our own in-house regulatory Team, I suspect that is why we have the view we no longer need them.
I'd prefer it if they didn't take up ex-China rights because, whilst we'd miss out on some milestone payments the future revs and earnings from Fruquintinib in the U.S are huge - $1.7bn annual sales outside China has been forecast by Analysts based on Co. data
"Bernie, our CEO actually said it during the Analyst Presentation, he hopes they don't take up the rights because we now have or will soon have the capabilities to take it global on our own"
Thanks for that, I finally got round to watching the presentation and you're spot on with what you say there.
It's a strange situation to be in.
If Eli-Lilly don't take up their rights, then it presumably means they don't think there's enough cash in it for them, which normally would be a negative. But there could still be enough money in it for us to do better out of it than we would do in partnership.
As expected the share price has been drifting slowly. How ever, it is encouraging to see big chunks of shares being bought almost every trading day. People/firms buying these should be aware of the real prospects here.
Chinese approval of the first drug candidate is the 'tonic' required to galvanise the share price at this moment. Hope it comes through soon.
I don't think there were any surprises in the results, but that's not a bad thing.
David - when you say " Chi-Med is comfortable with, and actually sees advantages in Lilly not taking up global rights to Fruquintinib as they are gearing up on the U.S Regulatory side", is that something you picked up on from the presentation ( I've skimmed the pdf, but havn't watched the video yet ) , or is it just a gut reaction ?
Personally, I've always thought that Eli-Lilly will just adopt a "wait and see what happens in China first" attitude. If they think there's money in it for them to take up the global rights, then surely they'll do so ?
Chienese authorities Approval for the first drug candidate is vital. Until then, unless some other positive news is provided, slow drift of share price can be expected.
Perhaps, good for those patient investors to accumulate cheaply.
DG, is any monetary value provided by the CEO for Chinese approval for the first drug?
Why hasnt Aim hailed Chi-Med success?
Two companies on Londons junior stock market, the Alternative Investment Market, claim about 90% of the attention. Thats understandable, since fashion retailer Asos, the biggest, and tonic water upstart Fever-Tree, the third biggest, are well-known firms that have been superb investments.
Whats the second biggest? Its Hutchison China MediTech, or Chi-Med, which has performed just as well. The firm first was mentioned in this column as long ago as 2009 when share price was 200p. Now the shares are £51.40, giving a stock market value of £3.45bn.
Chi-Med is the first serious attempt to build a Chinese-based international pharmaceutical firm, and the project is plainly going well. Mondays full-year numbers continued the smooth progress. Fruquintinib, a colorectal cancer treatment being developed with US pharma giant Lilly, could be launched in China later this year. Savolitinib, for lung cancer, is partnered with AstraZeneca and being tested in combination with some of the UKs firms established drugs.
Nothing is guaranteed in the drug-development game, but Chi-Meds soaring valuation points to investor interest, especially in the US, where the firm now has joint listing on Nasdaq. The Aim market has its critics, but the criticism in this case is that London has not done enough to shout about a big success. If there were more Chi-Meds, nobody would care about titans such as Saudi Aramco.
1. Chi-Med is comfortable with, and actually sees advantages in Lilly not taking up global rights to Fruquintinib as they are gearing up on the U.S Regulatory side, so can now go it alone outside China
2. AZ have said they will proceed into final stages of development with Tagrisso globally
3. The fact the Company is setting up their own Regulatory Team based in the United States is important - they can push approval for Fruq (if Lilly do not take ex China rights) and for unpartnered drugs in the future - that is massive
I am looking forward to the numbers and of course the 2018 forward guidance but the most interesting part will be updates on Fruquintinib (especially what Lilly are doing with regards to global rights) and Savolitinib (especially what AZ are planning to do with regards to seeking BT designation)
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