CICC: Maintains OCUMENSION-B outperforming industry rating and raises target price to HKD 10.16

According to the Zhitong Finance APP, China International Capital Corporation (CICC) released a research report stating that it maintains its earnings forecast for OCUMENSION-B (01477) for 2025/2026. The firm maintains an outperform rating for the industry, and considering the recent upward shift in sector valuations, it has raised the DCF-based target price by 35.5% to HKD 10.16, which has an upside potential of 3.4% compared to the current stock price. The company announced its performance for the first half of 2025: revenue of RMB 294 million, a year-on-year increase of 75.4%; a loss of RMB 132 million during the period, which narrowed compared to the same period in 2024, in line with the firm's expectations. CICC's main points are as follows: Pipeline R&D is progressing steadily, with accelerated clinical and registration progress for core products According to the company's disclosure, 1) OT-1001 (Zhihui Tai, 0.24% cetirizine eye drops) has been approved for commercialization by the National Medical Products Administration, featuring dual mechanisms for anti-allergy and anti-inflammation; 2) OT-101 (low-concentration atropine) has completed the two-year administration for all subjects, and is expected to complete the unblinding of Phase III clinical trials by June 2026; 3) The application for the Phase III clinical trial of OT-802 (pilocarpine) has been approved, expected to start in early 2026, likely filling the market gap for innovative drugs in the presbyopia field in China; 4) OT-301 (gemeprost) has achieved the primary endpoint in a global multi-center Phase III clinical trial, surpassing latanoprost, and is a potential BIC intraocular pressure-lowering drug; 5) OT-703 (0.19mg fluocinolone vitreous implant) has been approved for entry into the real-world research application pilot in Boao, Hainan, and patient enrollment has been completed. Commercialization synergies are highlighted, with rapid expansion of sales networks and channel coverage In the first half of 2025, the company achieved revenue of RMB 294 million, a year-on-year increase of 75.4%, with significant growth in ophthalmic product sales, benefiting from the smooth integration of the product portfolio introduced from Alcon and the contribution of new products like Zhihui Tai. The company has covered 21,535 hospitals nationwide, including 2,799 tertiary hospitals, with a commercialization team of over 290 people, achieving a nationwide commercial network layout. At the same time, the company is actively promoting the market access of new products like Zhihui Tai in hospitals to enhance market share, build the OCUMENSION brand influence, and create new growth points for performance. Production system is gradually improving, with enhanced local manufacturing capabilities During the reporting period, six products of the company have received production approval, and commercial batch production is progressing in an orderly manner. The localized production of the core product Yushi Ying has entered the review and public announcement stage, marking a further breakthrough in the company's supply assurance and cost control. Relying on the advanced processes and supply chain management of the Suzhou factory, the company's "OCUMENSION Manufacturing" model is gradually being implemented, which the firm believes can ensure the stability of supply and product quality while strengthening scale advantages, likely improving production efficiency and reducing costs. In the future, as the production platform continues to improve, the firm believes that the company's competitiveness in the production and delivery of innovative ophthalmic drugs is expected to further enhance. Risk Warning: The launch progress of new products may not meet expectations; candidate drug profitability may not meet expectations