£2330m market cap
361.5p last close
Hutchison China MediTech (HCM) is an innovative China-based biopharma company targeting the global market for novel, highly selective oral oncology and immunology drugs. Its established China Healthcare business is growing ahead of the market. HCM is the healthcare arm of CK Hutchison (c 40% listed on AIM and NASDAQ).
Investment summary
Hutchison China MediTech (HCM) has built a substantial pipeline of potentially first- or best-in-class tyrosine kinase inhibitor drugs, some of which are in development with strategic partners. HCM has announced that key late-stage asset surufatinib met the primary endpoint of PFS in non-pancreatic NET, translating into an earlier than expected China NDA submission (Q419) and the potential launch of HCM’s first unpartnered asset (late 2020). We forecast two further product launches on the horizon in 2021/22 (China launch of fruquintinib in gastric cancer and global launch of savolitinib in NSCLC). Inclusion of fruquintinib in China’s NRDL (potentially Q419) presents another near-term inflection. At 30 June 2019, HCM had net cash of $237.3m.
Y/E Dec |
Revenue (US$m) |
EBITDA (US$m) |
PBT (US$m) |
EPS (c) |
P/E (x) |
P/CF (x) |
|---|---|---|---|---|---|---|
| 2017A | 241.2 | (50.7) | (53.5) | (4.3) | N/A | N/A |
| 2018A | 214.1 | (89.0) | (86.7) | (11.3) | N/A | N/A |
| 2019E | 182.9 | (144.8) | (147.0) | (17.7) | N/A | N/A |
| 2020E | 194.6 | (189.2) | (195.4) | (24.7) | N/A | N/A |
| Last updated on 04/07/2019 | ||||||
Industry outlook
HCM’s profitable Chinese healthcare business continues to benefit from the fast-growing domestic market, while the clinical, regulatory and technological environments are highly conducive to novel drug development. In the longer term, as the oncology pipeline comes to fruition, we expect HCM to become a major oncology company globally.
Last updated on 04/07/2019
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Balance sheet |
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| Forecast net cash (US$m) | 163 |
| Forecast gearing ratio (%) | N/A |
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Key management |
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| Simon To | Chairman |
| Christian Hogg | CEO |
| Johnny Cheng | CFO |
| Dr Weiguo Su | Chief Scientific Officer |
| Mark Lee | SVP, Corporate Fin & Dev. |
