20211222-招银国际-Appointment_of_a_globally_renowned_oncologist_to_lead_the_R_D_organization_4页_936kb

Summary of I-Mab BioPharma (IMAB US) Company Update

Core Content and Key Information

I-Mab BioPharma (IMAB US) has recently made strategic appointments and updates to its management team, signaling a focus on accelerating its R&D and commercialization efforts. The company has appointed Dr. Andrew Zhu, a globally renowned liver cancer oncologist, as President and board director, replacing Dr. Joan Shen. Dr. Zhu brings extensive experience in oncology drug development, having led over 50 global clinical trials with major pharmaceutical companies such as Merck, Eli Lilly, Roche, and Bayer. He has also played a key role in pivotal studies leading to FDA approvals and the development of the first IDH-1 inhibitor for cholangiocarcinoma. His new role will be based in Shanghai and report directly to the Founder and Chairman, Dr. Jingwu Zang.

In addition to the leadership change, I-Mab has appointed Mr. John Long as CFO and is planning a dual listing on the Hong Kong Stock Exchange (HKEx). The company has also formed a Commercialization Executive Council (CEC), which includes key executives such as Mr. Jielun Zhu (Chief Strategy Officer), Mr. Yifei Zhu (Chief Commercial Officer), Dr. Weimin Tang (Chief Business Officer), and Dr. Andrew Zhu (President). This move is expected to strengthen the company's ability to advance its drug pipeline and commercialize its products effectively.

Financial Highlights

The company maintains a BUY rating with a Target Price of US$103.60, which is unchanged from previous estimates. The DCF-based target price implies a potential upside of +115.38% from the current price of US$48.10. The company's financial performance for the years ending December 31 is as follows:

• Revenue (RMB mn): FY19A: 30, FY20A: 1,543, FY21E: 546, FY22E: 843, FY23E: 1,247
• Net profit (RMB mn): FY19A: (1,485), FY20A: 471, FY21E: (1,340), FY22E: (981), FY23E: (772)
• EPS (RMB per ADS): FY19A: N/A, FY20A: 8.07, FY21E: (17.42), FY22E: (12.75), FY23E: (10.03)
• Consensus EPS (RMB per ADS): FY21E: (11.12), FY22E: (8.80), FY23E: (7.64)
• R&D expenses (RMB mn): FY19A: (840), FY20A: (985), FY21E: (1,200), FY22E: (1,260), FY23E: (1,323)
• Admin expenses (RMB mn): FY19A: (655), FY20A: (402), FY21E: (650), FY22E: (550), FY23E: (578)
• Capex (RMB mn): FY19A: (12), FY20A: (8), FY21E: (100), FY22E: (100), FY23E: (100)

The company's financial statements show a net loss in FY19A and FY21E, with net profit in FY20A. The DCF valuation for equity is US$7,974 million, with a WACC of 9.74% and terminal growth rate of 3.0%.

Business Catalysts

• Anti-CD47 mAb: Plans to initiate two registrational trials in 2022 (one for NHL, one for MDS).
• Anti-CD38 mAb: Discussions with the China Drug Evaluation Center (CDE) to submit a BLA application for 3L MM by year-end.
• Anti-CD73 mAb: Phase 2 trial data readout in China and potential out-licensing deal expected in 1H21E.

Share Performance and Market Position

• Market Cap (US$ mn): 3,754
• Average 3-month total return (US$ mn): 31.74
• 52-week high/low (US$): 85.40 / 39.02
• Total issued shares (mn): 78

The company has a shareholding structure dominated by other public shareholders (65.0%), with CBC Group (17.5%), Hillhouse Capital (10.8%), and Founders (6.7%) also holding significant stakes.

Key Financial Ratios

• Gross margin: FY19A: 100%, FY20A: 100%, FY21E: 100%, FY22E: 85%, FY23E: 86%
• Current ratio: FY19A: 2, FY20A: 9, FY21E: 30, FY22E: 128, FY23E: 52
• Total debt to asset ratio (%): FY19A: 38%, FY20A: 11%, FY21E: 5%, FY22E: 4%, FY23E: 6%
• ROE: FY19A: (136)%, FY20A: 8%, FY21E: (31)%, FY22E: (30)%, FY23E: (30)%
• ROA: FY19A: (84)%, FY20A: 7%, FY21E: (30)%, FY22E: (28)%, FY23E: (29)%

Valuation and Sensitivity Analysis

The DCF per share is US$103.60, based on a terminal growth rate of 3.0% and WACC of 9.74%. The sensitivity analysis shows that the target price is sensitive to changes in the WACC and terminal growth rate, with the valuation decreasing as these rates increase.

Related Reports

• Strategic cooperation with Jumpcan to accelerate commercialization for long-acting rhGH (30 Nov 2021)
• Promising clinical results of leMZoparlimab in NHL (8 Nov 2021)
• Partnership with Sinopharm to prepare for commercialization in China (29 Oct 2021)
• CD73 confirmed as a promising target for cancer immunotherapy (21 Sep 2021)

Risk and Disclaimer

This report is not intended for individual investment advice and is based on public information. The information provided is for informational purposes only and does not constitute an offer or solicitation to buy or sell any security. The company is not a registered broker-dealer in the United States or Singapore, and the report may not be distributed to non-qualified recipients. Investors are advised to consult with a professional financial advisor before making any investment decisions.