In 2018, amid cheers and applause, Junshi Biosciences welcomed the approval and launch of toripalimab, the first domestically produced PD-1 monoclonal antibody in China. This was not only a milestone event for Junshi Biosciences, but also a time when the entire pharmaceutical and investment community was filled with confidence in China’s bio-innovative pharmaceutical enterprises, believing that their era had arrived.

However, as market competition intensified and for various reasons, biotech companies soon found that the future was not as fast or as beautiful as they had imagined. R&D was no longer the only barrier; commercialization also became a top priority for survival.

On the evening of August 30, Junshi Biosciences released its semi-annual report for 2024. The total revenue for the first half of the year was 786 million yuan, a year-on-year increase of 17.37%, with a net loss attributable to shareholders of 645 million yuan, a year-on-year decrease of 352 million yuan. The core product, toripalimab, achieved domestic sales revenue of 671 million yuan, a year-on-year increase of about 50%. It can be seen that after a series of changes, Junshi Biosciences has finally seen improvements in commercialization.

This year, Junshi Biosciences has seen a rapid increase in drug sales revenue, with commercial capabilities continuously improving online; while R&D costs are reduced and efficiency is increased, the pipeline is diversified and expanded with a focus on key areas, and new indications are steadily approved as planned. With significant loss reduction and a large amount of capital on hand, they have achieved “having food in hand, not worrying in heart,” greatly enhancing their sustainable operation capabilities.

01

Core product with 3 major indications approved, steadily expanding commercialization space

Since the beginning of the year, the increase in Junshi Biosciences’ revenue has mainly come from its core product, toripalimab, which achieved domestic sales revenue of 671 million yuan in the first half of the year, a nearly 50% year-on-year increase. The expansion of commercialization space is closely related to Junshi’s strategy for expanding indications.

Looking at domestic sales revenue, in 2024, toripalimab has a total of 6 indications included in the NDRL. After “establishing a foothold” within medical insurance, there is a high possibility of continued volume growth.

Beyond medical insurance, the new indications for toripalimab continue to expand. This year alone, it has officially announced the approval of 3 new indications and the acceptance of 2 marketing applications, covering perioperative lung cancer, as well as first-line treatment for advanced renal cell carcinoma, small cell lung cancer, triple-negative breast cancer, melanoma, and liver cancer. Among them, the new indication of toripalimab combined with bevacizumab for the first-line treatment of liver cancer took only 36 days from data reading to acceptance of the marketing application.

Junshi has stated that its strategy for the layout of indications for toripalimab is “small indications + large indications,” starting from “last-line indications and quickly advancing to first-line and perioperative treatments.” Now it seems that Junshi is indeed accelerating forward as planned.

This is a carefully designed differentiated layout. Several of the new indications for toripalimab are major indications with long medication cycles, large market potential, and many have “exclusive” characteristics, which to some extent avoid the red ocean “battlefield” of PD-1 in China and seize the blank market. Barring any surprises, toripalimab will continue to provide a steady stream of blood for Junshi’s commercialization.

In addition, Junshi has two other products in the commercialization stage, which also increase its self-sustaining capabilities. Its COVID-19 oral drug, Mindewei, after launching, has added a new sales model on the basis of Junshi’s existing self-operated hospital sales team. The new sales team has extensive experience in promoting the infectious disease field, and currently, Mindewei has entered more than 2,300 hospitals, including community health service centers, secondary hospitals, and tertiary hospitals, covering all provinces. With the ups and downs of infection waves, it contributes steadily to Junshi’s revenue; Junshi’s adalimumab, Junmaikang, has completed online bidding in 26 provinces and is currently completing medical insurance docking in various provinces.

02

Enhancing sustainable operations while advancing the R&D pipeline

Looking at the financial report for the first half of the year, another significant change in Junshi Biosciences’ financial indicators is the reduction in R&D expenditure. Compared to the same period in 2023, R&D spending has decreased by 42% to 546 million yuan.

Junshi Biosciences stated that with the achievement of the main research endpoints in multiple clinical trials of its core product toripalimab and the implementation of the “improving quality, efficiency, and focusing on returns” action plan, it has been continuously optimizing resource allocation in the first half of the year, focusing resources on more promising R&D pipelines, resulting in a 42% year-on-year decrease in R&D costs.

Since the beginning of this year, a series of changes have taken place in Junshi’s senior management structure. Junshi’s former deputy general manager and global R&D president, Zou Jianjun, has taken on the role of general manager and CEO, and Wang Xingyuan, former general manager of Hengrui Medicine’s oncology division, has become the general manager of Junshi’s marketing division. At the 2023 annual report performance meeting, Junshi provided a performance guidance for toripalimab to grow by 50% for three consecutive years and enter the top three in China, and the industry believes that Wang Xingyuan’s joining will be instrumental in achieving this goal.

The changes in senior personnel have brought about improvements in R&D and commercialization efficiency. Junshi has optimized the organizational structure of its commercial team, and the results of the mid-year report show that the new strategy is effective, enhancing the execution and sales efficiency of the commercial team.

On the other hand, the advancement of Junshi’s R&D pipeline has not been affected and continues to progress efficiently, focusing on key areas to build Junshi’s long-term blood-making capabilities. Among them, the anti-BTLA monoclonal antibody tifcemalimab is Junshi’s next major product after toripalimab, a potential first-in-class drug. Currently, tifcemalimab is conducting Phase II registration clinical studies, and it is also the only BTLA-targeted drug that has entered the Phase III stage globally. The Phase III study of tifcemalimab for maintenance treatment of limited-stage small cell lung cancer has completed the enrollment and first administration of the first subjects in China, the United States, Europe, and Japan. The Phase III clinical study for classical Hodgkin’s lymphoma is enrolling patients, and several Phase Ib/II studies combining tifcemalimab with toripalimab for the treatment of multiple tumor types are being conducted in China and the United States. It is evident that Junshi has high hopes for this “dual immunotherapy” and has clear intentions to expand overseas.

03

Accelerating internationalization to open up growth potential

In addition to significant achievements in reducing losses and increasing efficiency, and the efficient advancement of the R&D pipeline, during the reporting period, Junshi Biosciences’ already leading internationalization efforts have also accelerated across the board.

As the first domestically produced PD-1 to get approved by FDA, in January 2024, Junshi’s overseas partner Coherus announced that toripalimab is now available and usable in the United States and can be ordered at all 33 NCCN-designated cancer centers. According to Coherus’ performance report, toripalimab achieved rapid sales growth in the U.S. in the first half of the year, and it is expected that within approximately 2-3 years, the peak annual sales will reach $200 million.

At the beginning of this year, Coherus completed the divestment of its ophthalmology product assets, focusing on the tumor microenvironment and high-potential product lines that complement the PD-1 pathway, using toripalimab as the cornerstone for combined research with new drugs. As early data from these new therapies are read out, the “upgrade” of toripalimab’s R&D in the U.S. will also be quite promising.

After obtaining the FDA as a stepping stone, the launch process of toripalimab in more countries and regions is unstoppable.

Currently, the European Medicines Agency (EMA) Committee for Medicinal Products for Human Use (CHMP) has given a positive opinion on the marketing authorization application for toripalimab for the first-line treatment of esophageal and nasopharyngeal cancer, and Junshi has also stated that the company has completed the EMA’s inspections on production and clinical aspects, which means that the approval of these two indications in the EU is imminent.

Furthermore, Junshi’s registration progress with partners such as Hikma, Dr. Reddy’s, and Concord Biotech in the Middle East, North Africa, Latin America, and Southeast Asia in more than 50 countries is also frequently reported. The disclosed countries and regions that have submitted or accepted marketing applications include the UK, Australia, Singapore, Hong Kong, Malaysia, India, Brazil, Colombia, South Africa, Chile, Jordan, etc.

With meticulous management of existing space, continuous expansion of incremental space, continuous improvement of product portfolio innovation, and effective differentiation strategies, the improvement of Junshi’s financial indicators in the first half of the year can be traced back to these points. No matter the period, innovative pharmaceutical companies rely on products and business models. A biopharma with outstanding product innovation and internal adjustment capabilities has no reason not to navigate through the cycle.

【Editor’s note】The above content (~9000 words) is a quick translation of a Chinese article (posted on 2024-08-31) by DrugTimes team. To read the original article, please click here. All comments are warmly welcome. Many thanks!