20210226-招银国际-开拓药业-B-09939.HK-Enrollment_completed_for_proxalutamide_for_hospitalized_COVID-19_patients_in_Brazil_5页_1mb

Kintor Pharmaceutical (9939 HK) Summary

Core Content

Kintor Pharmaceutical is a biopharmaceutical company that has made progress in its drug development pipeline, particularly in the treatment of COVID-19 and oncology. The company has completed patient enrollment for a clinical trial of Proxalutamide in Brazil for hospitalized COVID-19 patients, which is a multi-center, randomized, double-blinded, placebo-controlled study. The primary endpoint is the effectiveness of Proxalutamide on day-14, measured by the 8-point ordinal scale.

Main Points

• Proxalutamide Trial in Brazil:

  • Completed patient enrollment with 588 patients (294 male and 294 female).
  • The trial assesses Proxalutamide's efficacy for hospitalized patients.
  • Full data expected in March 2021.

• Promising Outpatient Data:

  • In male patients, the hospitalization rate in the Proxalutamide group was 0% (0/134), significantly lower than the control group (27.0%, 35/138).
  • In female patients, the interim analysis showed lower rates of hospitalization, ICU admission, mechanical ventilation, and mortality in the Proxalutamide group compared to the control group.

• R&D Progress:

  • GT90001 (ALK-1 antibody):
    • IND approved for a multiregional phase II trial in combination with Nivolumab for second-line treatment of advanced HCC in Feb 2021.
    • Results from the phase II trial in Taiwan presented at ASCO-GI in Jan 2021.
  • GT20029 (AR-degrader):
    • IND applications accepted by NMPA in Feb 2021 for androgenetic alopecia and acne vulgaris.
    • First clinical-stage PROTAC product from Kintor's in-house platform.
  • Pyrilutamide:
    • NMPA IND approval for gel formula for acne vulgaris in Sep 2020.
    • Phase II trial for androgenetic alopecia in China completed in Dec 2020.
    • Phase III trial to start in 2H21E.

Key Financial Information

• Target Price: HK$21.41 (raised from HK$19.38)
• 12-Month Price Performance: Not provided in absolute terms, but share performance shows a 30.1% gain in 1 month and 88.5% in 3 months.

Shareholding and Market Data

• Market Cap: HK$6,531 million
• Avg. 3-Month Turnover: HK$12.87 million
• 52-Week High/Low: HK$22.95 / HK$7.20
• Total Issued Shares: 369 million
• Shareholding Structure:
  • Management: 34.03%
  • Pre-IPO & Cornerstone Investors: 34.07%
  • Free Float: 31.90%

Valuation

• DCF Valuation:
  • Based on a 10-year risk-adjusted DCF model with WACC of 11.8% and terminal growth rate of 2.0%.
  • Target Price: HK$21.41
• Sensitivity Analysis:
  • Shows the impact of changes in WACC and terminal growth rate on the target price.

Financial Statements Summary

Income Statement (YE 31 Dec)

Cash Flow Summary

• Operating Cash Flow: (115) in FY18A, (262) in FY21E, and (26) in FY22E.
• Investing Cash Flow: (65) in FY18A, (150) in FY21E, and (80) in FY22E.
• Financing Cash Flow: 304 in FY18A, 1,650 in FY20E, and 0 in FY21E.
• Net Change in Cash: 124 in FY18A, (412) in FY21E, and (106) in FY22E.

Balance Sheet (YE 31 Dec)

Key Ratios

Analyst Recommendation

• Ratings: BUY
• Target Price: HK$21.41
• Reason: Positive progress in Proxalutamide for treating hospitalized patients and a robust pipeline of potential therapies.

Risks

• Delay in pipeline progress
• Competition from peers

Conclusion

Kintor Pharmaceutical has made significant progress in its clinical trials for Proxalutamide, showing promising results in outpatient treatment of COVID-19. The company is also advancing multiple R&D programs, including GT90001 and GT20029. Despite financial losses in recent years, the company is showing signs of improvement in its net profit and margins. The target price of HK$21.41 reflects the analyst's positive outlook on the company's future potential.