HUTCHMED (HCM) 


Data at EHA 2024 heighten focus on sovleplenib

Please find attached our HUTCHMED Update which focuses on the clinical profile and commercial prospects of sovleplenib, the first HUTCHMED immunology/haem-oncology asset to be filed in China, following recent presentation of Phase III data at EHA 2024.

Symbol       HCM / HCM.L / 0013.HK (NASDAQ / AIM London / SEHK) 
Price           $18.14 ($3.16bn) / 288p (£2.51bn) / HK$28.55 (HK$24.87bn)
Date           25 June 2024


HUTCHMED’s clinical data presentations at the European Hematology Association (EHA) 2024 congress have provided meaningful insights into sovleplenib’s efficacy and safety profile. This is the first HUTCHMED immunology/haem-oncology asset to be filed in China, with a potential approval decision in ≥2L immune thrombocytopenia (ITP) expected late-2024. The prospect of China approvals for sovleplenib and follow-on indications for fruquintinib, as well as the first potential fruquintinib regulatory decision for advanced metastatic colorectal cancer (mCRC) in Japan (following its recent European approval) could round off a busy 2024. Continued commercial execution underpins the FY24 expectation for Oncology/Immunology consolidated revenues of $300-$400m, driven by targeted 30-50% growth in marketed product sales and royalties. Our HUTCHMED valuation is increased c 5% to $6.10bn/£5.09bn/HK$47.61bn, or $35.03/ADS and 584p/HK$54.64 per share.

  • Positive sovleplenib data at EHA Results of the ESLIM-01 Phase III study in ITP confirmed a durable response rate of 48.4% and overall response rate of 70.6% at week 24, in a heavily pre-treated patient population. Efficacy and tolerability data suggest a competitive profile vs other approved/late-stage small molecule drugs, including first-in-class Syk inhibitor fostamatinib. Phase II proof of concept data were also presented in a second immunology indication, as well as initial Phase I results in Hodgkin’s Lymphoma.
  • Next steps for sovleplenib The China NDA in ≥2L ITP was accepted for Priority Review in January 2024, with an approval decision expected around end-2024. Launch planning is underway, with a modest specialty immunology sales and marketing team expected to be in place by year-end, supplementing HUTCHMED’s existing commercial infrastructure. For ex-China global markets, an international Phase Ib bridging study has started enrolment, and regulatory discussions are ongoing regarding the design of the Phase III programme. A strategic partner is sought for further global development and commercialisation.
  • Update valuation of $35.03/ADS or 584p/HK$54.64 per share Based on the detailed sovleplenib ITP data we increase our China peak sales in this indication to $300m (from $200m) and now also include a token $50m peak sales in a second indication (rare disease wAIHA). With sovleplenib filed for approval in China, we increase our success probability to 95% (from 85%). These changes to our sovleplenib assumptions in China result in an overall +5% uplift to our HUTCHMED valuation, with this increased to $6.10bn/£5.09bn/HK$47.61bn or $35.03/ADS and 584p/HK$54.64 per share.

Read or download the full report here....

Analysts 

Philippa Gardner pgardner@trinitydelta.org
Lala Gregorek lgregorek@trinitydelta.org
Franc Gregori fgregori@trinitydelta.org