Ascletis Pharma Inc (1672) H1 2022 earnings summary

Executive summary

• H1 revenue rose 4.6% YoY to RMB38.218m; gross profit was RMB24.367m versus a gross loss of RMB2.560m, and net loss narrowed 20.6% to RMB87.998m.

• R&D spending increased 60.5% to RMB118.8m; seven IND approvals were secured, two candidates advanced into Phase II, and six candidates were in Phase II or III development.

• Cash and cash equivalents were RMB2,483.7m at June 30, 2022, stated to support R&D activities for the next five years.

Financial highlights

• Product sales rose to RMB5.220m from RMB0.354m, while promotion service revenue was RMB32.998m versus RMB34.488m.

• Gross margin was 63.8%; cost of sales fell 64.6% to RMB13.9m, partly because H1 2021 included RMB23.0m of inventory impairment; H1 2022 included a RMB1.15m reversal of inventory write-down.

• Other income and gains rose to RMB47.817m, including a RMB32.196m net foreign-exchange gain and RMB13.362m bank interest income.

• Basic and diluted loss per share narrowed to RMB0.081 from RMB0.1009.

Outlook and guidance

• H2 priorities included expanding sales of ritonavir, ASCLEVIR and GANOVO; accelerating ASC10 and ASC11 COVID-19 development; advancing selected clinical programs; and pursuing licensing opportunities.

• 2022 milestones included ASC10 first dosing in the U.S. and China with preliminary safety and pharmacokinetic data, and ASC11 IND submission in China and/or the U.S.

• Planned milestones included ASC22 dosing in the agreed low-HBsAg CHB population, ASC42 CHB topline data, and completion of the ASC42 PBC drug-interaction study.

• Multiple commercial product launches were expected within three years; no interim dividend was recommended.