China Galaxy Securities: New Targets and New Mechanisms for the Blue Ocean Free from Disease Market Promoting Rapid Industry Development

The Zhitong Finance App learned that China Galaxy Securities released a research report stating that autoimmune diseases affect more than 10% of the global population, and the market size is second only to tumors and continues to grow. Industry research and development is shifting from “broad-spectrum anti-inflammatory” to “precise regulation”. In fields such as psoriasis and atopic dermatitis, new targets and drugs with new mechanisms are constantly emerging. Faced with huge unmet clinical needs, domestic companies are actively deploying through innovative research and development, bringing relevant investment opportunities.

The main views of China Galaxy Securities are as follows:

The blue ocean market for free diseases, new targets and new mechanisms promote the rapid development of the industry

According to a report published in “The Lancet” in 2023, autoimmune diseases may affect the health of more than 10% of the world's population. The number of patients with autoimmune diseases is growing rapidly. The self-immune drug market is second only to tumors, and is in a period of rapid development. According to Frost & Sullivan data, the global self-exemption market reached US$132.3 billion in 2022, and is expected to grow to US$176.7 billion (CAGR 3.68%) in 2030. Drug development for autoimmune diseases is undergoing a paradigm shift from “broad-spectrum anti-inflammatory” to “precise regulation”, and existing drugs still have huge room for improvement in efficacy and safety. In recent years, with breakthroughs in disease-specific mechanism analysis, multiomics technology, and novel delivery systems, related new drugs have continued to emerge, and drugs with new targets and mechanisms are constantly emerging, providing patients with safer, long-term, and individualized treatment plans.

The mechanism of immune diseases is complicated, and psoriasis, atopic dermatitis, etc. are expected to achieve breakthroughs

Psoriasis affects the normal lives of about 125 million patients worldwide. Currently, it is mainly macromolecular antibody drugs. Small-molecule oral TYK2 inhibitors are being developed and are expected to replace existing drugs; atopic dermatitis affects more than 204 million people worldwide, and sales of IL-4Rα antibody dupriumab in the first three quarters of 2025 have exceeded 12.9 billion US dollars, making it the leading drug in the field of self-immunity. The latest STAT6PROTAC oral drug shows better efficacy, starting the journey against type II disease; the global incidence rate of rheumatoid arthritis is 0.5% to J 1%, J AK class The efficacy of inhibitors is generally better than biologics, but there is still a need to improve the selectivity of JAK1; COPD is the fourth largest cause of death in the world, and traditional treatments have limited efficacy. New targets such as IL-33/ST2, TSLP, and PDE3/4 show better clinical key indicators such as FEV1 improvement; SLE is known as an immortal “cancer”, involving multiple systems and organs throughout the body. Among the currently marketed drugs, Taitacip has superior curative efficacy. In the future, targeted therapy and treatments such as CAR-T will rewrite the SLE treatment pattern. In summary, the new target and new formulations will bring better curative effects to protect oneself from diseases.

Self-immune diseases have large unmet clinical needs. Pay attention to investment opportunities in related companies

Currently, domestic companies are actively deploying innovative drugs for self-prevention, opening the ceiling through target innovation and broadening indications. Integrate the company's clinical pipeline, R&D efficiency and operational efficiency. It is recommended to focus on Xiansheng Pharmaceutical, Connoya, Quanxin Biotech, Yifang Biotech, and Sansheng Guojian. 1) Xiansheng Pharmaceutical: The early research pipeline focuses on differentiated targets. SIM0278 (IL-2mU-FC), SIM0709 (TL1a/IL23p19), and SIM0711 (IRAK4PROTAC) are all potential targets, and there is a possibility of continuous BD. 2) Conoa-B: Spuquibizumab is in the rapid release phase, with an expected peak sales of 5 billion yuan; CM512 is the world's leading TSLPxIL-13 double antibody, with a half-life of up to 70 days and good safety, showing initial potential for BIC treatment; 3) Quanxin Bio-B: qx013n is a humanized monoclonal antibody targeting c-Kit, suitable for the treatment of CSU; 4 additional dual antibody projects will submit IND applications from 2025 to 2026. 4) Yifang Bio-U: D-2570 (TYK2 inhibitor) has now initiated phase II clinical trials for UC indications, and Q1 data is expected to be read out next year; psoriatic indications are undergoing phase III clinical trials, and phase II clinical trial data are excellent, showing BIC potential. 5) Sansheng Guojian: In the research pipeline, 610 is the fastest progressing IL-5 monoclonal antibody in China. The improvement in pulmonary function in asthma patients is obvious. The company expects to declare an NDA in 2027; 613 is an IL-1beta antibody. In the NDA stage for gout arthritis, only domestically produced cinnamomab was approved for marketing.

Risk warning: risk of R&D progress falling short of expectations; risk of industry policy uncertainty; risk of commercial sales falling short of expectations; risk of increased market competition.