Orient Securities has released a research report adjusting the earnings per share forecasts for LEADS BIOLABS-B (09887) for 2026-2028 to -1.41, -0.44, and 0.04 yuan respectively, based on the 2025 annual report and recent clinical progress. Using a DCF valuation method, the firm has set a target price of HK$103.06 and reaffirmed its "Buy" rating.

The company reported revenue of 180 million yuan in 2025, primarily driven by a $25 million upfront and milestone payment received following the successful business development of LBL-047, marking a significant breakthrough.

Clinical progress for LBL-024 is advancing smoothly, with a key international opportunity anticipated. By the end of March, nine clinical studies across 13 solid tumor indications had been initiated, enrolling over 600 patients. Specifically: 1) The Phase III registrational study for third-line and beyond extra-pulmonary neuroendocrine carcinoma completed patient enrollment in August 2025, with a Biologics License Application expected in the third quarter of 2026; 2) The Phase II study for first-line/second-line and beyond non-small cell lung cancer has enrolled over 100 patients, with full enrollment projected for the second quarter of 2026; 3) Phase II proof-of-concept trials have begun for six major indications, including first-line advanced melanoma, first-line biliary tract cancer, first-line hepatocellular carcinoma, platinum-resistant ovarian cancer, first-line/second-line triple-negative breast cancer, and first-line esophageal squamous cell carcinoma, all with first patients enrolled. The first-line biliary tract cancer trial has already progressed to the expansion phase; 4) Additional proof-of-concept trials for first-line gastric or gastroesophageal junction adenocarcinoma and gastrointestinal tumors are planned. Key data for core indications are expected to be presented at the WCLC and ESMO conferences in September, which could validate its potential in major cancer types and pan-tumor settings, potentially opening a critical window for international business development.

For LBL-034, the Phase I/II clinical trial for relapsed/refractory multiple myeloma has enrolled nearly 100 patients. Expanded sample data readouts are anticipated at this year's R&D Day, which may confirm its potential as a best-in-class therapy globally. As bispecific, trispecific, and CAR-T therapies move into earlier lines of treatment, the patient population post-BCMA therapy is growing, enhancing the business development value of LBL-034.

The company's platform capabilities are emerging, with a pipeline of first-in-class candidates under development. Based on its IO bispecific/T-cell engager/ADC platforms, next-generation global FIC assets including LBL-054 (CDH17/CD3 ADC), LBL-061 (EGFR/PD-L1 ADC), LBL-066 (PD-L1/4-1BB trispecific), and LBL-076 (CD38/GPRC5D/CD3 TCE) are expected to submit IND applications in China and the US in the fourth quarter of 2026 or the first quarter of 2027, bolstering the future pipeline.

Risks include potential failure in innovative drug development, commercialization setbacks, intensified market competition, loss of key personnel, and valuation uncertainties.