The development of original new drugs has always been considered a high-risk industry. A drug requires more than 10 years of time and an investment of hundreds of millions of dollars in research and development costs, going through various stages from project initiation to subsequent clinical validation. Any mistake could lead to a complete failure. Over the past decade, China’s innovative drug industry has grown from nothing and has experienced cycles from peaks to troughs. During the years of winter, the industry has been continuously differentiated. After the winnowing process, the pace of industry development has noticeably accelerated this year, and a number of domestic innovative pharmaceutical companies have delivered impressive mid-year reports, with the dawn of the return of the value of innovative drugs already emerging.

Recently, Ascentage Pharma (6855.HK) announced its mid-year performance for 2024. During the reporting period, the company achieved breakthrough progress in external cooperation, commercialization, and clinical development under the guidance of the “Global Innovation” strategy. It is worth mentioning that the company’s total revenue reached a new high in the first half of 2024, and it achieved profitability for the first time.

During the reporting period, Ascentage Pharma’s revenue reached a new high, with a total revenue of RMB 824 million, a year-on-year increase of 477%, mainly from product sales revenue and external cooperation licensing revenue. The company achieved profitability for the first time, with a net profit of RMB 163 million.

During the reporting period, the commercialization of the company’s first listed product, Olverembatinib (R&D code: HQP1351), was rapidly promoted, achieving sales revenue of RMB 113 million, a sequential increase of 120% from the second half of the previous year, and a year-on-year increase of 5% from the first half of the previous year.

The company signed an exclusive option agreement with the multinational pharmaceutical company Takeda for Olverembatinib. Once the option is exercised, Takeda will obtain the global rights to develop and commercialize Olverembatinib, except for Mainland China, the Hong Kong Special Administrative Region, the Macao Special Administrative Region, and Taiwan. Ascentage Pharma has received an option payment of RMB 720 million and an equity investment of RMB 540 million.

The company’s cash flow continues to improve, maintaining a robust and abundant status: as of June 30, 2024, the cash balance was RMB 1.1 billion; as of early July 2024, the cash balance was RMB 1.8 billion.

01

Initiating Major Global Collaborations, Achieving the Largest BD Deal for Small Molecule Oncology Drugs in China

Ascentage Pharma has been actively seeking global partners and has reached an exclusive option agreement with the multinational pharmaceutical company Takeda for Olverembatinib during the reporting period.

The total transaction value of this collaboration amounts to RMB 9.36 billion, including an option payment of RMB 720 million, and a total of RMB 8.64 billion in option exercise fees and additional potential milestone payments. At the same time, the company will also receive a double-digit percentage of incremental sales royalties based on annual sales. To date, this collaboration is the largest outbound licensing deal in the domestic small molecule oncology drug field. In addition, Ascentage Pharma has also received equity investment from Takeda.

This collaboration fully demonstrates the global clinical and commercial value of Olverembatinib and has laid the foundation for its future global commercialization process. Currently, Ascentage Pharma has received an option payment of RMB 720 million and an equity investment of RMB 540 million from Takeda.

02

Olverembatinib Commercialization Rapidly Advancing Hematopoiesis Capability Continuously Strengthening

With the first indication of the company’s original Class 1 new drug Olverembatinib included in the medical insurance in January 2023; the new indication approved in November 2023, Olverembatinib is continuously releasing growth space, and the commercialization hematopoiesis capability of Ascentage Pharma is gradually strengthening. During the reporting period, Olverembatinib achieved sales revenue of RMB 113 million, a sequential increase of 120%, and a year-on-year increase of 5%.

Ascentage Pharma is rapidly advancing the commercialization of the listed products. As of June 30, 2024, Olverembatinib has reached 670 hospitals and DTP pharmacies nationwide, with the number of hospitals admitted increasing by 79% compared to the end of last year. Since the new indication was approved in November last year to June 30 this year, Olverembatinib has been included in 114 projects of major disease supplementary insurance or Hui Min Bao reimbursement in 83 cities of 20 provinces, among which it has been included in the special drug directory of Hui Min Bao in 20 provincial or municipal levels such as Hebei Province, Hainan Province, Inner Mongolia Autonomous Region, Wuxi, Huzhou, Shenzhen, Yantai, etc., greatly reducing the medical burden on patients and improving the accessibility of medication.

As the first third-generation BCR-ABL inhibitor approved for marketing in China, the clinical value and potential of Olverembatinib have been continuously recognized by authoritative figures in the field of oncology at home and abroad during the reporting period. In January 2024, the drug was included in the National Comprehensive Cancer Network (NCCN) guidelines for the treatment of chronic myeloid leukemia (CML); in addition, Olverembatinib was upgraded and recommended in the 2024 CSCO malignant hematological disease diagnosis and treatment guidelines during the reporting period, involving the treatment of CML, Philadelphia chromosome-positive acute lymphoblastic leukemia (Ph+ ALL), and adding multiple Grade I recommendations.

In July of this year, Olverembatinib was approved for marketing in Macao, China, with the approved indications for the treatment of adult patients with chronic phase (-CP) and accelerated phase (-AP) of CML who are resistant to any tyrosine kinase inhibitor (TKI) and have T315I mutation; and for the treatment of adult patients with CML-CP who are resistant and/or intolerant to first and second generation TKIs. This is another major milestone for the drug after being approved for marketing in mainland China.

03

Global Innovation Achievements are Remarkable with 8 Registration Clinical Trials Fully Advancing

Under the strategic guidance of “Global Innovation,” Ascentage Pharma has achieved multiple milestone progress in clinical development during the reporting period, with the global clinical layout continuously advancing at a high speed. To date, the company’s two core products, Olverembatinib and Bcl-2 inhibitor APG-2575 (Lisaftoclax), have obtained a total of 11 registration clinical trial approvals, of which 3 have been completed, and the other 8 are being vigorously promoted.

In February 2024, Olverembatinib was granted permission by the U.S. Food and Drug Administration (FDA) to conduct a global registration Phase III clinical study for the treatment of adult patients with chronic myeloid leukemia in chronic phase (CML-CP) who have previously received treatment. This is the first registration Phase III clinical study of Olverembatinib approved by the U.S. FDA and an important step in Ascentage Pharma’s global hematologic oncology layout.

Beyond hematologic malignancies, in June of this year, Olverembatinib was granted clinical trial approval by the National Medical Products Administration (NMPA) Center for Drug Evaluation (CDE) to conduct its global registration Phase III clinical study for patients with succinate dehydrogenase (SDH)-deficient gastrointestinal stromal tumors (GIST) who have failed systemic treatment. This is a significant milestone in the company’s clinical development in the field of solid tumors.

In addition, Ascentage Pharma is also deeply cultivating the clinical layout of Bcl-2 selective inhibitor APG-2575 (Lisaftoclax) in the field of hematologic malignancies. During the reporting period, APG-2575 (Lisaftoclax) was granted clinical trial approval by the CDE to conduct a registration Phase III clinical study of this product in combination with azacitidine (AZA) for the first-line treatment of newly diagnosed patients with intermediate and high-risk myelodysplastic syndromes (MDS). This is the fourth registration Phase III clinical study approved for APG-2575 (Lisaftoclax).

04

Clinical Data Continues to be Strong, Progress in Multiple Fields Continuously Recognized Globally

As an innovative pharmaceutical company always focused on global innovation, Ascentage Pharma has built a high-value product pipeline with the potential for “First-in-class” and “Best-in-class,” and has carried out more than 40 clinical trials in China, the United States, Australia, Europe, and Canada. The therapeutic potential of multiple pipeline products in various fields is continuously explored and verified, and multiple clinical progresses have been successively disclosed at major international academic conferences, further demonstrating the company’s product development advantages and global clinical development strength.

During the reporting period, four clinical progresses of Ascentage Pharma’s three key products, Olverembatinib, APG-2575 (Lisaftoclax), and APG-2449, were selected for the 2024 American Society of Clinical Oncology (ASCO) Annual Meeting, which is also the company’s seventh consecutive appearance at the ASCO Annual Meeting. Among them, the latest data of Olverembatinib treating TKI-resistant SDH-deficient GIST patients were reported orally. The data show that Olverembatinib shows a good therapeutic prospect in the field of SDH-deficient GIST, a disease area that currently has no standard treatment plan, with a clinical benefit rate (CBR) of 92.3% and a median progression-free survival (PFS) of 25.7 months. The latest data of FAK/ALK/ROS1 triple kinase inhibitor APG-2449 in non-small cell lung cancer (NSCLC) patients were also displayed at the ASCO Annual Meeting, once again reflecting the therapeutic potential of this product in the field of NSCLC.

At the 2024 European Hematology Association Annual Meeting (EHA 2024) held in June this year, Ascentage Pharma presented the latest progress of five studies, involving three key products of Olverembatinib, APG-2575 (Lisaftoclax), and APG-5918, fully demonstrating the company’s competitive strength in hematologic malignancies. Olverembatinib had three studies selected for EHA 2024, one of which updated the median one-year follow-up data of Olverembatinib treating CML and Ph+ ALL patients based on the data presented at the 2023 American Society of Hematology (ASH) Annual Meeting. The data show that Olverembatinib has shown excellent and sustained clinical efficacy in patients who have been treated with multiple TKIs (including resistance to ponatinib or/and asciminib), with or without T315I mutation, and has good long-term drug tolerance.

APG-2575 (Lisaftoclax) also has multiple clinical progresses selected at this year’s ASCO Annual Meeting and EHA Annual Meeting, all of which show the therapeutic potential of this product in various hematologic malignancy fields. At this ASCO Annual Meeting, Ascentage Pharma presented the latest positive data of the Ib/II phase clinical study of APG-2575 (Lisaftoclax) in combination with AZA for the treatment of newly diagnosed (TN) or relapsed/refractory (R/R) acute myeloid leukemia (AML) patients, and the latest positive data of the global multicenter Ib/II phase study of APG-2575 (Lisaftoclax) as a single drug or in combination for the treatment of patients with Waldenström’s macroglobulinemia (WM). At EHA 2024, the latest positive data of APG-2575 (Lisaftoclax) treating R/R multiple myeloma (MM) or immunoglobulin light chain (AL) amyloidosis patients were displayed.

In addition, Olverembatinib, APG-115, APG-2449, and APG-5918 four products announced three latest preclinical research results at the 2024 American Association for Cancer Research Annual Meeting (2024AACR), providing important support for further clinical exploration.

05

Deepening Global Innovation Strategy, Moving Towards a New Stage of Development

In line with the company’s long-term strategy and development, during the reporting period, Ascentage Pharma has confidentially submitted to the U.S. Securities and Exchange Commission an F-1 registration statement draft for the proposed initial public offering of American Depositary Shares representing the company’s ordinary shares.

Ascentage Pharma has always adhered to the “Global Innovation” strategy and insists on the global intellectual property layout. As of June 30, 2024, the company has 520 authorized patents worldwide, of which 367 patents are authorized overseas.

Dr. Dajun Yang, Chairman and CEO of Ascentage Pharma, said: “In the first half of 2024, Ascentage Pharma has achieved a number of milestone progress in global BD, product commercialization, and global clinical development, fully demonstrating the company’s global innovation strength and competitive advantage in the field of hematologic oncology.”

During the reporting period, we reached a global cooperation with the multinational pharmaceutical company Takeda on Olverembatinib, which amounts to more than 9 billion yuan, and will receive a double-digit increasing sales share based on annual sales. This is the largest BD of domestic small molecule oncology drugs to date. In addition, the company also received a 540 million yuan equity investment from Takeda. This cooperation once again verifies the company’s leading position in the industry and the global strength of Olverembatinib, and is expected to release clinical value in more areas where there are no drugs available. In February of this year, Olverembatinib was permitted by the U.S. FDA to conduct a global registration Phase III clinical trial, which is also a major milestone in the product’s globalization process.

It is particularly worth noting that the company achieved profitability for the first time during the reporting period. With Olverembatinibbeing included in the national medical insurance directory and the approval of new indications for listing, the company’s commercialization capabilities continue to improve. At the same time, the company’s global clinical development is fully advancing, and the indications of key pipeline products are continuously expanding, further strengthening the company’s solid competitive barrier in the field of hematologic oncology.

In the future, we will continue to adhere to the people-centered and “Global Innovation” concept, further enhance commercialization capabilities, and accelerate the global clinical development of research and development varieties. We look forward to bringing multiple global innovative drugs to the international market as soon as possible, truly fulfilling the mission of “solving the unmet clinical needs of patients in China and around the world,” benefiting patients worldwide, and creating more value for society and shareholders.

【Editor’s note】The above content (~13300 words) is a quick translation of a Chinese article (posted on 2024-08-23) by DrugTimes team. To read the original article, please click here. All comments are warmly welcome. Many thanks!