Guotai Junan: initiates coverage on DUALITYBIO-B (09606) with a "buy" rating and a target price of HKD 300.70.

Guotai Haitong released a research report stating that it is covering DUALITYBIO-B (09606) for the first time and giving it a "hold" rating. The company focuses on ADC new drug development, has achieved multiple License-out agreements for external authorization, is expanding into the global market, and its core products are entering a period of fruition. It is expected that the revenue for 2025-2027 will be 16.00/19.76/22.07 billion yuan. Using a comprehensive absolute valuation method and a relative valuation method, the target price is set at HK$300.70 per share. The main viewpoints of Guotai Haitong are as follows: DB-1303: Comparable to Enhertu, leading globally. HER2ADC has become an important treatment method in fields such as HER2+BC, with Enhertu achieving breakthroughs in clinical trials and leading the way in clinical drug iteration. DB-1303, a new generation HER2ADC developed by the company, has a molecular structure comparable to Enhertu, leading globally in clinical development speed, and early clinical data shows Best-in-Class potential. DB-1303 is exploring the blue ocean market for endometrial cancer indications and is expected to apply for market approval in the United States in the second half of 2025. Subsequent HER2+BC indications are expected to apply for market approval in China in the second half of 2025, with registration clinical trials already underway globally for HR+/HER2 low-expression BC indications, progress second only to Enhertu. After risk adjustment, it is expected that the domestic peak value could reach 2.6 billion yuan and the US peak value could reach 1.6 billion US dollars. DB-1311: Initial treatment potential, expected to lead breakthroughs in SCLC and CRPC. B7-H3 is an important target in the tumor immune escape mechanism with a wide range of treatment potential, and there are currently no approved B7-H3 therapies on the market globally. B7-H3ADC DB-1311 targeting ES-SCLC and mCRPC has shown excellent efficacy and safety in early clinical exploration, ranking among the top globally in research and development progress, expected to lead drug breakthroughs. After risk adjustment, it is expected that the domestic peak value could reach 600 million yuan and the US peak value could reach 1.1 billion US dollars. Rich pipeline, continued expansion of ADC layout The company has developed four major ADC technology platforms DITAC, DIBACDIMAC, and DUPAC, and multiple products are entering the clinical stage with the potential to release POC data. TROP2ADC DB-1305 has conducted clinical explorations with combined PD-L1/VEGF dual antibodies, HER3ADC DB-1310 is expected to release POC data for NSCLC and BC indications in 2025, and B7-H4ADC DB-1312 progress ranks among the top globally. Risk factors: Risk of clinical trial progress falling short of expectations; risk of new drug development results falling short of expectations; risk of market promotion and sales falling short of expectations; risk of international business progress falling short of expectations.