20230714-浙商证券-CXO专题报告_全球领先XDC_CRDMO药明合联申请IPO_14页_2mb

Summary of Pharmaceutical Industry Report on ADC and CXO

Market Overview

• The report analyzes the Antibody-Drug Conjugate (ADC) market and Contract Research, Development and Manufacturing Organization (CRDMO) services, focusing on Yiming United (药明合联)'s IPO on Hong Kong Stock Exchange on July 9, 2023.
• ADC drugs, due to their targeted therapy approach for cancer, have shown rapid growth; the global market was $79 billion in 2022, expected to reach $647 billion by 2030, with a compound annual growth rate (CAGR) of 300% from 2022 to 2030.
• By 2023, there are over 500 ongoing clinical trials involving 222 ADC candidates, with many in key development stages, driven by technological advancements and high success potential, as seen with drugs like Enhertu.

Outsourcing Market in ADC

• Global ADC outsourcing reached approximately 70% by 2022, with a market value of $15 billion in 2022, growing at a 284% CAGR to $110 billion by 2030.
• This segment is highly concentrated, with major players like Yiming United dominating; five firms collectively hold about 50% market share based on 2022 revenue. Yiming United specifically ranked second with a 98% share in 2022 and leads in China with a 69.5% domestic market share.

Yiming United's Performance

• Client and project growth: Client count increased from 49 in 2020 to 167 by 2022, with a cumulative 296 clients by May 2023, and 94 active projects in 2022, up to 102 by end-2023.
• Financial highlights: Revenue rose from $964 million in 2020 to $4,876 million in Q1 2023, with IND-after services contributing increasingly (e.g., 62% share in 2023 Q1). Key technology, such as WuXiDAR4, enables high consistency in production, reducing development risks.
• Expansion efforts: Plans to build a new Singapore facility for 2026 GMP-compliant operations, aiming to serve global needs and increase capacity.

Future Trends and Risks

• Yiming United is positioned to capitalize on broader drug conjugates (e.g., XDC, targeting non-antibody carriers like oligonucleotides), with an estimated 134 XDC candidates in clinical trials, extending market potential.
• Risks include potential demand decline if ADC/XDC clinical results underperform, regulatory policy shifts in domestic regions, unstable international environments affecting clients or supply chains, and increased competition.

Key Takeaways

ADC and CRDMO services represent a high-growth opportunity in pharma biotech. Yiming United shows strong market leadership and expansion potential but faces regulatory and competitive challenges. Analysts maintain a positive outlook with no specific rating changes.

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