CICC published a research report maintaining its earnings forecasts for OCUMENSION-B (01477) for 2025/2026. The firm maintains its outperform rating and, considering the recent upward shift in sector valuation, raised its DCF-based target price by 35.5% to HK$10.16, representing 3.4% upside from current share price.
The company announced its 1H25 results: revenue of 294 million yuan, up 75.4% year-over-year; net loss of 132 million yuan, narrowed compared to the same period in 2024, in line with expectations.
CICC's main viewpoints are as follows:
**Pipeline development progresses steadily with accelerated clinical and regulatory progress for core products**
According to company disclosures: 1) OT-1001 (Zhivitai, 0.24% cetirizine eye drops) has received NMPA approval for commercialization, featuring dual anti-allergic and anti-inflammatory mechanisms; 2) OT-101 (low-concentration atropine) has completed two-year dosing for all subjects, with Phase III clinical unblinding expected to complete by June 2026; 3) OT-802 (pilocarpine) Phase III clinical trial application has been approved, expected to launch in early 2026, potentially filling the market gap for innovative drugs in domestic presbyopia treatment; 4) OT-301 (latanoprostene bunod) global multi-center Phase III clinical trial has achieved primary endpoint, outperforming latanoprost and representing a potential best-in-class IOP-lowering drug; 5) OT-703 (0.19mg fluocinolone acetonide intravitreal implant) has been approved for real-world research application pilot program in Hainan Boao Lecheng and has completed patient enrollment.
**Commercial synergies emerge with rapid expansion of sales network and channel coverage**
In 1H25, the company achieved revenue of 294 million yuan, up 75.4% year-over-year, with significant growth in ophthalmic product sales benefiting from successful integration of Alcon-licensed product portfolio and volume contribution from new products like Zhivitai. The company has achieved coverage of 21,535 hospitals nationwide, including 2,799 tertiary hospitals, with a commercialization team exceeding 290 members, establishing a nationwide commercial network. Meanwhile, the company actively promotes market access for new products like Zhivitai to enhance market share, build OCUMENSION brand influence, and create new growth drivers.
**Production system gradually improves with enhanced local manufacturing capabilities**
During the reporting period, six company products have received production approval, with commercial batch production progressing orderly. Local production of core product Yushi Ying has entered the regulatory review and publicity phase, marking further breakthrough in supply assurance and cost control. Leveraging advanced processes and supply chain management at the Suzhou facility, the company's "OCUMENSION Manufacturing" model is gradually being implemented, which is believed to ensure supply stability and product quality while strengthening scale advantages and potentially improving production efficiency and reducing costs. As the production platform continues to improve, the company's competitiveness in production and delivery of innovative ophthalmic drugs is expected to further strengthen.
**Risk factors**: New product launch progress may fall short of expectations; candidate drug profitability may underperform expectations.