CICC International: Raises target price for SINO BIOPHARM (01177) to HK$7.7, reiterates "buy" rating.

SINO BIOPHARM(01177) announced the acquisition of nearly 95.09% of Li Xin Pharmaceutical for over 500 million US dollars in net proceeds. After the completion of the transaction, Li Xin, which owns 8 clinical stage candidate drugs, will become its indirect wholly-owned subsidiary. The rating was reiterated as "buy", with the target price raised from HK$4.5 to HK$7.7. Considering that Li Xin Pharmaceutical's assets have potential in the global market, expects China Medicine to have more visibility on transactions with 1-2 authorized transactions. The bank is also focusing on the development opportunities of China Medicine's self-developed assets, such as PDE3/4 inhibitors, JAK/ROCK inhibitors, and HER2 bispecific ADCs. Taking into account potential business development income, the bank slightly adjusted this year's drug sales forecast, believing that the management's double-digit year-on-year growth guidance is likely to be achieved.