Huafu Securities initiated coverage on LEADS BIOLABS-B (09887) with a "Buy" rating, projecting the company's revenues for 2025-2027 to be RMB 180 million, RMB 94 million, and RMB 10 million, respectively, representing growth rates of 833%, -48%, and -90%.
Based on a DCF model with a WACC of 8.78% and a perpetual growth rate of 1%, the firm calculated a fair value share price of HK$101.86 and a fair market capitalization of HK$20.3 billion for the company.
The core investment thesis is as follows: The company has built a comprehensive pipeline of next-generation immuno-oncology therapies based on its agonist platform, TCE platform, and ADC technology.
Beginning with the X-body platform (4-1BB engager) in 2015 and the LeadsBody platform in 2016, followed by the accumulation of bispecific and trispecific antibody technologies, the company has consistently focused on a "technology platform + innovative targets" strategy.
This approach covers cutting-edge areas such as immune checkpoints and multispecific antibodies, enabling the construction of a differentiated pipeline.
LBL-024 (a PDL1/4-1BB bispecific antibody) has demonstrated historically best-in-class data in extrapulmonary neuroendocrine carcinoma and shows excellent efficacy as a first-line treatment for SCLC, with encouraging preliminary results in NSCLC.
The 4-1BB component significantly enhances the efficacy of second-generation CAR-T therapies; LBL-024 utilizes a 2:2 structural design that weakens 4-1BB affinity, resulting in lower hepatotoxicity compared to similar bispecific antibodies.
The incidence of grade ≥3 liver enzyme elevation was only 1.3%, comparable to PD-1 monotherapy, demonstrating LBL-024's exceptional safety profile and broad therapeutic window.
LBL-024 leads its class in clinical progress, being the world's first 4-1BB-targeting molecule to reach a pivotal clinical stage.
Beyond EP-NEC, clinical studies have been approved in areas with high unmet medical needs, including SCLC, BTC, OC, NSCLC, ESCC, and TNBC, where encouraging clinical effects have already been observed across multiple cancer types.
It has the potential to become a promising and effective anti-tumor drug for a broad range of indications, with key clinical milestones expected within the year.
LBL-034 (a GPRC5D/CD3 bispecific antibody) offers greater potential supported by superior safety and dose intensity.
Its 2:1 structure amplifies TAA binding, with steric hindrance ensuring CD3 activation only upon TAA binding, while also weakening CD3 affinity to balance efficacy and safety.
No DLTs or grade ≥3 CRS were observed even at the highest dose of 800μg/kg.
In the Phase I/II clinical study, LBL-034 achieved an ORR of 77.8% (with ≥VGPR at 61.1%) at a 400μg/kg dose, and an ORR of 90.9% (with ≥VGPR at 81.8%) at an 800μg/kg dose, showing efficacy comparable to CAR-T therapy.
Other pipeline assets include a BDCA2×TACI candidate slated for IND applications in China and the US in the second half of 2025, a CD19/BCMA/CD3 trispecific antibody for US IND in Q1 2026, and a DLL3 TCE ADC for China and US IND in the first half of 2027.
Risk factors include the potential for innovative drug R&D failure, intensifying competition in domestic and overseas markets, commercialization risks falling short of expectations, and the risk of losing key technical and managerial personnel.