Sichuan Kelun Pharmaceutical Co., Ltd. (002422) Earnings Call Transcript

Good morning, everyone. Thank you for joining this session at APAC Track. I'm Yang, China health care analyst at JPMorgan. Next, our presentation company will be Kelun Biotech. So joining us will be Dr. Michael Ge, CEO of Kelun Biotech. Let's welcome Dr. Ge.

Okay. Good morning, ladies and gentlemen. Thank you for joining us this morning, and thank you for having me to this event. My name is Michael Ge, the President and CEO of Kelun Biotech. First of all, as we will be making forward-looking statements, I refer you on the screen here. Kelun Biotech is a biopharmaceutical company, which are committed to the research, development, manufacturing and commercialization of the novel drugs in oncology, immunology, metabolism and other disease therapeutic area. Kelun Pharma is our largest shareholder and MSD is the second largest shareholder and a major collaborator. Since our founding more than 10 years ago, Kelun Biotech has emerged as a leader in innovative drug R&D industry in China with truly differentiated technology platform and pipeline programs. Central to our R&D engine is our world-class drug conjugate technology platform, our name is OptiDC. To date, we have over 30 pipeline programs under development, including 4 approved products with 7 indications, 2 products with 2 indications at NDA stage and over 10 programs in clinical development. We expect more product approvals and label expansions in 2026. As of December of 2025, we have around 2,000 employees, which makes us one of the largest Chinese biotech company. Of the 2,000 employees, about 900 is R&D professionals, 500 are in the manufacturing and quality control and about 500 is the sales and marketing in China. This slide shows an overview of our pipeline programs. We have 4 launched products and another one in NDA stage is the next-generation RET inhibitor is a small molecule product. Our TROP2 ADC, the Sac-TMT was launched in China in November of 2024, which is also the first TROP2 ADC approved for the lung cancer treatment globally. So far, it has been approved for 3 indications in China is 2 plus TNBC, second line and third-line EGFR mutant non-small cell lung cancer. Our HER2 ADC, trastuzumab botidotin, it was just approved last October, which is actually the first domestically developed HER2 ADC approved for HER2-positive breast cancer in China. We also have [indiscernible] just for wild-type CRC and PD-L1 for NPC available on the market. Apart from TROP2 ADC and HER2 ADC, we also have 9 novel drug conjugates at the clinical stage with differentiated targeting payload linker design and novel compound structure, including our first bispecific ADC, SKB571 and our first radioisotope RDC, the drug conjugates, SKB107. Our China clinical development mostly focused on the top oncology indications with large patient population, such as the breast cancer, lung cancer and gastrointestinal cancer. We have initiated 5 pivotal clinical studies for breast cancer, 6 for lung cancer and 1 for GI with our TROP2 ADC, HER2 ADC, cetuximab N01 and the RET inhibitor. Some of them already approved last year in China. We are also exploring the opportunities for other indications in Phase I or Phase II, such as gynecological or genitourinary cancer. In addition, there are significant pipelines at Phase I or Phase II stage, which we are expected to move into pivotal studies in the upcoming years, subject to their escalation and expansion study data. In 2025, we have presented clinical data for 6 pivotal studies as well as a series of Phase I, Phase II studies at various academic conferences and published in international renowned journals. Notably, our OptiTROP-Lung04 study is the study result for second-line EGFR mutant non-small cell lung cancer were presented in the presidential Symposium at ESMO 2025 and were simultaneously published in the New England Journal of Medicine. Readouts from part of these studies will be introduced to you in the later slides. We have got fourth products approved in China and expect to get our small molecule RET inhibitor approved this year. So these 5 products comprise our first batch of our commercial products with primary focus on the BC, LC and GI cancer. The indication concentration would bring us some synergy from marketing perspective. We also have set up a full-fledged commercialization team with access to core Class III hospitals as well as key opinion leaders. We expect to further expand our commercial team along with more products and indications approval in upcoming years. As a press release by the National Healthcare Security Administration, our 3 core products have been included in the National Reimbursement Drug List what was called NRDL 2025, which has taken effect since this month. We have attached great importance to global partnership and collaboration which we regard as the best way to bring our pipeline to the world, to the global market, it can be maximized our pipeline value and corporate value. We also have entered into a few out-license agreements collaboration with MSD, Ellipses, Windward Bio and Crescent Bio in the past years. MSD is just mentioned, is our second largest shareholder and is our major collaborator, also our strategic partner. Through the collaborated ADC pipelines, we aim to cover a wide range of tumor indications with different targets with differentiated payload link strategies. In last December, we announced the partnership with Crescent Bio to development and commercialize novel oncology therapies, including SKB105 and [indiscernible] and CR-001, the PD-1 VEGF bispecific antibody. In the next few slides, I will elaborate on our launch ADC products and GI pipelines. Firstly, our lead program, TROP2 ADC is also known as Sac-TMT. In China, clinical development of Sac-TMT is mostly focused on lung cancer and breast cancer, the 2 largest oncology indications. Sac-TMT has been approved for second-line TNBC. Second-line, third-line EGFR mutant non-small cell lung cancer in China. We also filed the NDAs for second-line HR-positive HER2-negative breast cancer last year. There are 5 Phase III trials for first-line breast cancer and lung cancer are ongoing in China. Meanwhile, our partner, MSD, is initiating 16 global Phase III studies as monotherapy or in combo for lung, breast, gastric and gynecology cancers, ranging from second line, third line to first line and even adjuvant and neoadjuvant. The earliest data of the global Phase III study readout is expected in this year. Given the differentiated design, Sac-TMT has demonstrated best-in-class performance in both efficacy and the safety profile. Just as the day before yesterday, the President of the Merck, [indiscernible] said, our product is the best-in-class. Don't ask why? Because the linker is some is loose, some is tight, maybe our is just the right. For China-based Phase III study results have been unveiled at ASCO the ESMO last year. Sac-TMT as a chemotherapy versus -- as a monotherapy versus the chemotherapy for second-line and third-line lung cancer and breast cancer benefits the patients with not just higher response rates and longer PFS, but also significant extension of overall survival. For example, the second-line EGFR mutant non-small cell lung cancer, Sac-TMT versus the [indiscernible] the PFS HR is 0.49. The OS HR is 0.6. Even the MOS of Sac-TMT group was not reached at the cutoff date. Based on the statistical forecasting, the MOS is expected to significantly extend on the top of the control arm. For the other studies, you can [indiscernible] trend for the third-line EGFR mutant small cell lung cancer for the second-line TNBC and also for the -- which we are in NDA stage, the second-line [indiscernible] HER2-negative breast cancer. The next product is our HER2 ADC utilizes of the [ VCMAF ] structure with a potent cytotoxin as its payload and demonstrated strong tumor clearability even in a low setting. Trastuzumab botidotin was just approved last October for second-line plus HER2-positive breast cancer. And the Phase III study results was unveiled at ESMO 2025. Compared with T-DM1, our HER2 ADC is shown to significantly improve the PFS with HR 0.39 and the ORR with 77%. OS benefit trend was also observed. Given the differentiated payload link design and the safety profile, our HER2 ADC is positioned to treat patients who are either intolerant or resistant to the top line-based HER2 ADC. Our TROP2 ADC and HER2 ADC have well covered lung cancer and breast cancer treatments. We're also advancing multiple development pipelines in the third largest indications in oncology, gastrointestinal cancer. Our first progress, our cetuximab N01 has been approved for the first-line treatment of RAS wild-type colorectal cancer. Meanwhile, we are also developing ADC pipelines for GI treatment. The Phase II data of our Claudin 18.2 ADC and TROP2 ADC for the gastric cancer has been unveiled at ESMO and AACR. There are also a few other ADC pipelines under development with the potential for GI cancer treatment, given their target expression on the colorectal and pancreatic tumor cells, such as the SKB571, 535, 500 and 105. In the next few pages, I will give an overview of our innovation capabilities and strategies. As mentioned, we have more than 10 years of experience in ADC discovery and development area. We named our drug conjugate platform as OptiDC, which means optimized drug conjugate. We have tailored the design of every drug candidate with the consideration of the characters of a specific target or targeting mechanism and adopt the most suitable payload link strategy to best balance the efficacy and the safety profile. We also have the integrated capabilities of the R&D and manufacturing to help the development and for the life cycle development of the ADCs. With our team's experience and knowledge base, we adopt a multipronged strategy to further advance our OptiDC platform. For oncology treatments, typically ADC is regarded as a replacement for traditional chemotherapy. That's why we are developing novel targets with bispecific antibody structure. And also, we're expanding payloads beyond the common [indiscernible] and the tubulin inhibitors, including us the dual payloads. We are also exploring nontoxin-based drug conjugates with either radioisotope or protein degrader or the immunomodulator as the payload. Beyond oncology, we are also applying our experience and know-how to develop [indiscernible] ADCs for autoimmune and metabolic diseases. The ADC structure could potentially combine the biological and small molecule in novel targeting mechanism, resulting in better safety window as well as efficacy to patients with chronic disease. As I conclude this presentation, I would like to highlight the following firm-wide growth plans. Our top priority is still to rapidly advance our differentiated pipeline programs with significant medical needs. Secondly, we will continue to innovate and optimize our ADC platform discovered novel pillars, linkers, [indiscernible] novel ADC designs and expand the clinical applications of drug conjugates to [ non-cology ] disease areas. Our third focus is to build upon and expand our end-to-end drug development, manufacturing and commercialization capabilities. Lastly, we are gradually expanding our business landscape through our strategic partnerships globally and improving our capabilities for the development, registration and commercialization of our products in ex-China markets. This will be all my presentation today. Thank you for your time. Thank you.