The latest: Drug developer Shanghai Junshi Biosciences Co. Ltd. (1877.HK; 688180.SH) announced late Monday that VV116, an oral drug developed by its JunTop Biosciences unit for the early treatment of Covid-19, has reached the main endpoint of clinical studies.
Looking up: The company said it will communicate with China’s National Medical Products Administration (NMPA) on submitting a new drug application in the near future. If approved, sales of the drug could provide a major new revenue source.
Take Note: The NMPA has approved the import of the oral Covid drug Paxlovid from Pfizer (PFE.US), which has been conditionally included on the National Reimbursement Drug List and is the lowest priced product of its type in the world. Thus, even if VV116 is approved for sale in China, it will face strong competition.
Digging Deeper: Junshi Biosciences performed poorly last year due to frequent changes in its sales and marketing team. Its core product Toripalimab, a PD-1 drug used to treat small-cell lung cancer, saw its revenue drop by nearly 60% last year. The downturn continued into this year as it lost 396 million yuan ($59.4 million) in the first quarter, reversing a year-ago profit. The company is actively developing Covid drugs in a bid to strengthen its revenue streams. In addition to VV116, its self-developed Covid neutralizing antibody JS016, combined with another neutralizing antibody developed by Eli Lilly (LLY.US), have received emergency authorizations as a dual antibody therapy in more than 15 countries. The therapy has been purchased in large quantities in the U.S. and Europe.
Market Reaction: Junshi Biosciences’ shares plunged 13.6% in early Tuesday trade in Hong Kong, and closed down 10% at HK$49.50 at the midday break. The stock is down 27.9% in just two weeks from a high of HK$68.65 in mid-May.
Translation by Jony Ho
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