AKESO(9926.HK)：PROMISING PH3 DATA OF CADONILIMAB IN 1L GC-格隆汇

机构：招银国际
研究员：Jill WU/Andy WANG

　　Promising Ph3 data of cadonilimab in 1L GC, especially for patients with low PD-L1 expression. The interim Ph3 (NCT05008783) data of cadonilimab in 1L GC was recently released at the AACR meeting (link). With a median follow-up of 18.7 months, cadonilimab + chemo (XELOX) extended the mOS by 4.2 months for the 610 ITT patients and reduced the risk of death by 38% (mOS 15.0 vs 10.8 months, HR=0.62, P<0.001). In a cross-trial comparison, when combined with chemotherapy, sintilimab, nivolumab and pembrolizumab reduced the risk of death by 32%, 21% and 22%, according to ORIENT-16, Checkmate-649, and KEYNOTE-859 trials, respectively. It’s important to note that, only 42% of the patients enrolled in cadonilimab’s trial had PD-L1 CPS≥5, vs 61% and 60% in sintilimab and nivolumab’s trials, repsectively. For patients with CPS≥5, cadonilimab lowered the risk of death by 44%, compared to 41%, 30% and 26% of sintilimab, nivolumab and tislelizumab (Rationale305). Notably, for patients with CPS<5, cadonilimab + chemo also reduced the risk of death by 30%, underscoring its benefits for the underserved patients with low PD-L1 expression.
　　Anticipating a more active NRDL strategy for cadonilimab to accelerate market penetration. In Nov 2023, the above-mentioned Ph3 trial of cadonilimab in 1L GC met the OS endpoint, and an sNDA was submitted to the CDE in Jan 2024, with approval expected by end-2024/early-2025. The competitive landscape for the large 1L GC indication appears relatively moderate. In combination with chemo, sintilimab, nivolumab, and pembrolizumab have been approved in China for 1L HER2- GC, regardless of PD-L1 expression. Tislelizumab + chemo has been approved for PD-L1 high 1L GC, while the sBLA for patients regardless of PD-L1 expression is under review by the CDE. Sintilimab and tislelizumab are included in the NRDL for 1L GC at annual costs of around RMB37.4K and RMB43.5K, vs cadonilimab’s current annual cost of c. RMB158.6K. Following the approval of cadonilimab for the large indication of 1L GC, we expect its inclusion in the NRDL from early 2026, which could further accelerate sales. Sales of cadonilimab in FY23 reached RMB1.36bn with 2H23 sales up 24% HoH. We expect FY24E sales of cadonilimab to reach RMB1.79bn (+31% YoY).
　　Near-term data readout of AK112’s head-to-head study. The H2H Ph3 study of AK112 mono vs pembrolizumab for PD-L1+ (TPS≥1%) NSCLC was fully enrolled in Aug 2023, with interim PFS readout expected in 2Q24. Akeso submitted the NDA of AK112 in Aug 2023 for post-TKI EGFR-m nsq-NSCLC, with the approval and relevant data release expected in 2H24. The MRCT HARMONi trial conducted by Summit is on track to complete enrolment in 2H24. The Ph3 trial in China evaluating AK112 + chemo vs tislelizumab + chemo in 1L sq-NSCLC is expected to complete enrolment in 2024 or early 2025. We expect Akeso to initiate more Ph3 trials of AK112 to fully explore the potential of the drug.
　　Maintain BUY. We see the blockbuster potential of AK104 and AK112. Akeso’s non-oncology assets are near commercialization with NDAs of PCSK9 and IL12/23 under review. We maintain our TP unchanged at HK$59.61 (WACC: 10.97%, terminal growth rate: 3.0%).