For innovative drug companies, valuation hinges on pipeline potential, and InnoCare's lead asset in the autoimmune space, the highly selective TYK2 allosteric inhibitor ICP-488 (Fadeucravacitinib), remains a key focus for capital markets due to its clinical progress and commercial promise. Using the industry-standard risk-adjusted net present value (rNPV) model, we incorporate public clinical data, the competitive landscape, and commercialization expectations to estimate the pipeline's intrinsic worth, offering a reference point for valuation.

At its core, rNPV discounts the drug's full lifecycle cash flows to the present after adjusting for multiple risks. The formula is: Peak sales × Probability of clinical success × Discount factor. Peak sales itself is calculated as: Total target patient population × Expected peak penetration rate × Market share × Annual treatment cost × Clinical data quality coefficient × Commercial rights coefficient.

Regarding clinical success probability, the Phase III registration trial for ICP-488 in moderate-to-severe plaque psoriasis hit its primary endpoints in July 2026, with key efficacy measures like PASI 75 and PASI 90 meeting preset goals. Safety data aligns with earlier studies, showing no new concerns. The program is now in data cleaning and preparing for regulatory submission, with an NDA expected within 2027. Based on standard industry benchmarks for clinical success rates, we assign a probability of 0.70.

For the patient population, ICP-488 focuses on moderate-to-severe plaque psoriasis. According to public industry data and InnoCare's disclosures, there are roughly 8.66 million psoriasis patients in China, a number that's still growing. Around 32% of these have moderate-to-severe plaque psoriasis requiring systemic treatment, translating to a target population of about 2.8 million patients.

On penetration, this calculation uses the TYK2 inhibitor class's long-term steady-state penetration rate among these patients in China by the time the market matures. Looking at mature markets like the US and Europe, TYK2 inhibitors, with their oral dosing and favorable safety profile, could reach a steady-state penetration of around 12%. In China, innovative drug penetration typically hits about 60%-70% of Western levels, suggesting a baseline of roughly 7.8%. Factoring in a 15% local adjustment, driven by patient preference for oral therapies and broader grassroots access, the single-indication peak penetration rate is set at about 9%.

In terms of market share, Bristol-Myers Squibb's deucravacitinib is already on the market domestically, with over five other similar products from companies like Yifan Bio, Hansoh Pharma, and Wenda Pharma in Phase III trials. Considering the competitive landscape and commercial strength, we assign InnoCare a 20% market share assumption for ICP-488.

For annual treatment costs, after the 2025 National Reimbursement Drug List negotiations, the price of deucravacitinib dropped significantly, with post-reimbursement costs around 19,300 RMB per year. Domestic TYK2 inhibitors generally adopt a follow-on pricing strategy, typically at 60%-80% of the originator's price. Given that ICP-488 is a domestic innovative drug with some clinical value premium, but also needs to fit within the reimbursement system and competitive pricing, we estimate post-negotiation annual treatment costs of roughly 15,000 RMB.

Evaluating clinical data quality, data from the Phase III randomized, double-blind, controlled trial shows ICP-488 met its key endpoints. The 9mg dose group had significantly better PASI 75 and PASI 90 response rates at week 12 versus placebo, with overall efficacy comparable to deucravacitinib and a differentiated advantage in long-term safety and tolerability. Given the robust trial design and efficacy at the advanced level of current standard care, exceeding typical non-inferiority drugs, a clinical data quality coefficient of 0.80 is applied.

On commercial rights, ICP-488 is a self-developed Class 1 innovative drug by InnoCare, holding full development, manufacturing, and commercialization rights in Greater China. With its established commercial team, there are no external sales royalty obligations. Based on these factors, a commercial rights coefficient of 0.95 is used.

Calculating with these parameters, the estimated peak annual sales for ICP-488 in the psoriasis indication in Greater China is about 570 million RMB. For the discount factor, InnoCare, with its commercialized products and mature promotional capabilities, carries a lower overall pipeline risk than early-stage biotechs, so a 12% discount rate is applied. ICP-488 is expected to launch around 2028, and given the typical 5-7 year market ramp-up, peak sales could be reached around 2034, roughly 8 years from now. Using compound discounting, the factor is about 0.40. Combined with the 0.70 clinical success probability, the final rNPV for ICP-488's Greater China psoriasis indication is approximately 160 million RMB.

Disclaimer: The peak sales and risk-adjusted net present value figures here are model calculations based on public information and a set of subjective assumptions. They serve only to illustrate the valuation logic, not as official guidance from InnoCare, and do not constitute investment advice. Key parameters like clinical success rates, penetration rates, market share, and annual treatment costs face considerable uncertainty, and actual outcomes may differ significantly from these estimates. Investors should form their own judgment and bear the investment risk accordingly.