Member Info for LongOdds

Totally agree. After the initial disappointment a year back, this is a definite plus.

How is AI changing the competitive landscape of biotech and how is HCM incorporating it into their R&D efforts?

Ir Jatw is correct, then you have to wonder why they went to the effort of pursuing this drug in the first place, unless it makes sense to sell the overseas rights. Seems a near total waste as things stand

Anyone seen any details of the presentations? In particular, it would be interesting to know a little bit more as to why they chose to highlight A87. Normally links to the presentations are include in the announcements of upcoming scientific meetings

I think unlikely. First of all that would require a CEO to be appointed who could persuade Victor of the merits of such a strategy and then have the ability to execute. Until you see such a CEO, then don’t expect HCM to be the front and centre of any such consolidation.

But even with such a CEO, his chances of persuading Victor likely to be slim. Biotech is so far away of the core competency of CK/Hutch (that they ended up here was never the original intention when they founded HCM. It was merely to support HK’s push into Chinese Traditional Medicine under its first government post the handover). Betting the balance sheet on a sector they don’t really understand, is very hard to see.

Usually best not to look backwards too much. Successful CEO’s are often as much a consequence of their time and place as their own endeavours and energies. This might explain why re-runs rarely work a well second time around. I would guess that it is much more important that if and when a full time CEO is appointed, that he or she can capture the imagination of mainland fund managers rather than those in the west. It is the later who are the dominant force in today’s HSI.

Looking forward, even if today’s stock market is in no mood to react to good news, the announcement of the FRUSICA-2 registration trials is a definite positive. The potential for success here had been deliberately played down given the disappointment over other recent trial results, most notably for second line Gastric Cancer last year. We now have another major use of the drug alongside RCC. This, together with maybe some more visibility on Ph3 SAFFRON and a much fuller explanation of why the market should be excited by ATTC at the upcoming R&D analyst briefing, should help to set the tone for a more positive appraisal of the company after years of underperformance. Fingers crossed. It is about time.

I think internally they must be hoping that this will be the real gift that Dr Su, who drove the decision to pivot to the ATTC platform, will leave for the company.

He may not have been dealt a strong set of cards as CEO over the last 3-4 years, whether geo-politicallly or in terms of trial results (where changing policies by regulators, both in the US and China, have often confounded everyone). Likewise he has nevercbeen the natural salesman that Christian was in terms of either driving or hyping the company and its shares. But his strength as a scientist has never been in question.

From their various recent comments, I think there has to be some confidence that the market will end up impressed when the announce exactly what the first cancer is that they are targeting. For it to be otherwise, would be a significant disappointment and hardly justify the bet that are making. So yes, I do hope for a surprise on the upside from the upcoming analyst briefing.

Meanwhile, there is also the question of what sort of M&A could occur with their cash pile in order to strengthen their product base and more fully utilise their PRC distribution abilities. But for that to happen, we may have to await confirmation of who is the CEO and not merely the acting CEO.

Can HCM fully recover its lustre? I increasingly doubt it as others dominate the space. But if some of that momentum is ever to be regained, they have to put their best foot forward at the end of this month. Here is hoping.

I am largely in agreement with Billybawb but as I alluded earlier to much derision, if shareholders were paid every time our esteemed board used the word imminent, we would all be a lot richer. Imminent is a description of time not a space filler.

We just have to hope it is more profitable for the Malawi Government to cut a deal with Mkango and the other current crop of mining hopefuls, rather than squeeze us all out as we wait for Godot. I think and hope they will, but as it seems with our esteemed board, I have zero influence.

Hopefully the stars will yet align.

Sadly I am not quite of that view.

Not one of our directors have ever previously successfully negotiated a mining development agreement. That might partially explain the total drift of the company and its shares over the last 12-18 months. And certainly those self same directors have not deigned to appoint anyone with greater experience than their own rather limited faculties.

As for their use of “imminent”, it seems to be more of a speech defect that an accurate description of time. Just ask those that poneyed up cash in February. And as for some £40m of capex spent against a £27m valuation, that sort of result is not usually the way to attract the more sophisticated of investors.

If anything, this deal may happen in spite of our ever so hearty band of directors. My guess is that there noses are more in the trough than the know.

But I remain optimistic that at this stage it is more in the interest of Malawi to proceed than not to…..but let’s see!

Sadly I don’t think all the PR in the world would make a difference in the current markets to a company reporting losses and still developing its drug portfolio. There is no PE and there is no yield.

The fact is that HCM unfortunately remains principally a case of conjecture and promises at a time when money has started costing a lot more than it once did. We have little support.

Until the interest rate cycle changes, there is a limit to what management can do to help the shareprice. The time to have made hay, was the previous few years when unfortunately various drug discoveries disappointed/were delayed, CK Hutch was selling down and HCM also needed to raise fresh equity. All of this meant we lagged.

The critical news however is that money was raised - even if the disappointment over Surufatinib has meant we possibly should have raised even more. A lot of companies will have failed to do so, suggesting wage/cost inflation will have slowed a bit in the sector. Meanwhile HCM’s drug discovery continues and the portfolio is sufficiently strong and enabling, that strong revenues should be forthcoming, even if losses are for the time being are inevitable. The report by Trinity Delta does very much highlight the quality of the portfolio, particularly as it relates to Fruquitinib.

Management’s job currently is to keep their heads down and drive the company, whether sales of its existing portfolio or the current tests that are underway. All the smooth chat in the world, whether from Christian Hogg or Weiguo Su would/will have minimal impact until the US bond market has run its course and China energies from its current rut.

It’s painful but sometimes markets are what they are. The word shiite springs to mind. But that is life.

From what I have gathered, the FDA was facing widespread criticism from numerous parties as to being too gung-ho on permitting new drugs via various routes without insisting on full Phase III trials, whether domestically produced or internationally. With all the new technologies and level of innovation, it is easy to see why the FDA has wanted to encourage so many treatments, despite the risks. But likewise, some have not delivered and then, after the Sackler episode, it is not exactly surprising that the FDA is vulnerable to critics .

Clamping down on bridging studies and requiring full domestic trials was just one of the results. The consequence has been to remove the arbitrage: cheaper Phase III trials in China, bridging studies elsewhere. But in reality, HCM were only looking to try the arbitrage on Surufatinib. Every other drug is undergoing the full international trial process.

That Europe and probably Japan follows the US can not exactly surprise either given the geopolitics of today.

But hopefully spilt milk. Fresco II later this month is all critical for this year. Fingers crossed it delivers. If it does, this year can still be seen as positive even if the shareprice (and markets in general) may still take some further time to recover.

I don’t think you should get to uptight about these options. HCM’s principle assets are its employees, whether inventing the drugs or selling them (and those managing the process). Every company in this space pays and help retain those such assets by using options. HCM’s use options is very much within the industry average as regards percentage issued per year.

We as shareholders may be upset with what has happened to the share price over the last few months. I certainly am. But most of us have diversified portfolios to various degrees.

In contrast I bet the employees and who have received their options have very such diversity in their investments. The options they have received for all their work over the last five years are currently worthless

As shareholders let us hope they remain at HCM, that they continue to accept options as part of their package, that the shares recover and their loyalty and hard work is rewarded. That is the only way we are going to get out of our hole.

If you had sold everything on the day CH resigned, you would be very tempted to buy in. Sadly I didn’t. But important to hope that value will have its way.

We are hostages to the macro world of inflation (amplified by Ukraine) and China lock downs. That may last for a while. But specifics also important. After the disappointments of the ADR’s and then Suru, which was a total shock, we desperately need success with FRESCO II to stabilise the ship. Odds are probably better than even given how well they know the drug, but nothing in the bag until it is. We have had plenty of experience of that.

After that, an asset disposal of the legacy business should then highlight value and remove funding issues. But it is very tough at the moment. Such is the nature of investing.

The last month and more has been hugely disappointing for the share price, principally impacted as it has been by Christian Hogg’s shock (if understandable) retirement and then all the shenanigans relating to the ADR listings.

We probably also have to accept that the expected FDA decision as to the approval of Sulanda by April 30 will be delayed. Internal travel within China has only got worse through this year, meaning that the Beijing based FDA inspectors have been grounded; and are probably facing a significant back log.

On the other hand, it will only be a delay and hopefully later this year (especially once Summer gets going and Covid cases seasonally dissipate), those inspections will occur and FDA decisions announced. Meanwhile, arguably the biggest news of the year lies ahead in May/June when we will get the release of the Fruquitinib Fresco II data. Success with this trial offers major positives and the possibility of US sales running into $300-400m pa. And then in August we will find out a lot more about how the Savannah trial went. That they have charged into the Phase III Safron trial and Astra Zeneca has paid out $20m suggests the news was not bad.

The share price is awful. That is not up for dispute. But I continue to believe that the company is progressing in a very positive manner, and that is without taking into account any of their third generation drug trials, a lot more about which will be known over the next 28-24 months. Weigao, supported by a strong management put in place by CH, is hopefully a safe pair of hands during this period.

Investors, however frustrated, should sit tight.

Analyst valuation targets are always comparative. They are never absolute. If other stocks fall (as they have across the board) and interest rates start to rise, then all bets are off as analysts are forced to adjust all their assumptions. Sadly HCM in the recent cycle was late to the game in terms of getting drugs qualified and revenues generated. Hence we never benefited from the fun and games seen by the likes of Wuxi and Beigene.

Hopefully we will be better placed in the next cycle, as cycles do repeat themselves. It’s just the timing that is ever unclear!!

Nothing illegal about it at all. Happens all the time across the world (and not just China) as doctors look to ascertain what publicly available drugs might work best for their individual patients, some of whom might have cancers so rare that even Phase I trials are never conducted.

Meanwhile if you are an ambitious salesman worth your salt working for Astra Zeneca and speaking to a hospital, surely you are going to want to mention that while Orpathys has been licensed for NSCLC with somewhat rare MET exon 14 skipping alterations, the drug also has completed a (wildly?) successful Phase 11 trial with Tagrisso for the much more common advantage metastatic EGFR mutation positive NSCLC with MET amplification. And confidence is so high that an exceptionally expensive global phase III trial is now underway.

And then of course as a third line patient with the latter and assuming you can afford the non-NRDL treatment price, you almost certainly would want your doctor to consider prescribing the drug. The alternative of waiting for the global Phase III trial results might not prove ideal if that means you are dead by then.

So while Hutch Med awaits further Phase III trials on its three publicly available drugs within China, the market will be watching for just how successfully the sales teams start the process of persuading the medical industry to utilise Elunate, Sulanda and Opathys across as many scenarios and to as many cancer patients as possible.

……and the one other area to focus on at the next set off results and beyond, will be how successful the much grown China based sales team has been in securing off-label sales.

Those sales teams already have considerable bodies of evidence to hand (ahead of the various Phase III trials over the next 2-3 years) to show potential patients how the now three licensed drugs can assist in different cancer types.

Off-label sales have always been a significant feature of the most successful Chinese drug companies. HCM has to prove it can do it too.

There was also some market concern prior to this that pricing pressure by the regulator this year might have been so extreme that the company was prepared to take the likes of Elunate off the NRDL. That agreement has been reached between the two, even if details of the new pricing do not yet seem to have been released, has to be good news.

On my Yahoo Finance app, 0013 HK is not uploading. It is stuck on last Friday’s close (which is good in some ways but less useful in others). Is anyone else having the same issues?

13 HK was the Ling time stock exchange code for Hutchison Whampoa, the original controlling shareholder of Hutch Med. In a major restructuring of the Li Ka-Shing empire, Hutchison was then merged with its own controlling shareholder Cheung Kong (1 HK) in 2015 under the name of CK Hutchison. At the time, the code 1 HK was retained by the group, while 13 HK was given up. The Stock Exchange has now returned the number to the group with the listing of HCM.