Mazdutide (9mg) continues to show its BIC potential with 48-week results.

Innovent released the 48-week results of mazdutide (9mg) in Ph2 study in Chinese obesity patients (link). After 48 weeks of treatment, the placebo-adjusted mean percent change in body weight from baseline was -18.6% (-17.8kg) in 59 of the 80 enrolled patients with treatment extended.

Recall in May 2023, mazdutide (9mg) met the primary endpoint of its Ph2 trial in Chinese obesity patients, showing 15.4% placebo-adjusted weight loss at week 24 (vs 12.0% of tirzepatide 15mg and 8.0% of semaglutide, CMBI report, link).

Mazdutide showed global BIC efficacy potential with the highest placebo-adjusted weight loss percentage among the major competing GLP-1 drugs in Chinese subjects. Tirzepatide realized 17.4% (15mg) and 11.5% (10mg) placebo-adjusted weight loss at week 48 in its China Ph3 trial (link) and semaglutide showed 9.9% weight loss in its Asian Ph3 trial (link) at week 44.

Multiple cardiometabolic benefits observed. In the above-mentioned Ph2 trial, mazdutide demonstrated significant improvement in multiple cardiometabolic indicators (such as waist circumference, blood pressure, liver enzyme, triglyceride, LDL-C, and serum uric acid, etc). After the 24-week treatment, mazdutide reduced subjects' liver fat content (baseline liver fat content ≥5%) by 73.3% (vs -6.5% in placebo) and induced 45.5% placebo-adjusted reductions in ALT levels, and these benefits maintained to 48 weeks.

In addition, after the 24-week treatment, mazdutide significantly reduced triglyceride, total cholesterol, LDL-C and serum uric acid levels, with HDL-C levels stable throughout the 48-week treatment. Similarly, Hanmi GCGR/GLP-1 agonist efinopegdutide also demonstrated 72.7% reduction in liver fat content (vs 42.3% in semaglutide arm, Ph2, link) at week 24. We see the potential of mazdutide to expand additional indication beyond diabetes and obesity.

Continued to show favourable safety profile. The Ph2 obesity study of mazdutide (9mg) is still in progress with detailed safety data to be disclosed, while the drug was overall well-tolerated. Similar with the 24-week results, there was no AE-led drop-out, or no SAE was observed at week 48 in the Ph2 trial in both the treatment and placebo groups. Meanwhile, in tirzepatide and semaglutide's China/Asian trials, 2.9% (tirzepatide 10mg), 7.0% (tirzepatide 15mg) and 2.8% (semaglutide) of subjects discontinued due to AE, and the rates of SAE were 4.3%, 11.3% and 5.2%, respectively. Heart rate increase in mazdutide group was similar to placebo after 24 weeks of treatment, with no further increase till week 48.

Front runner in China with NDA submission to happen soon. Innovent is developing two doses of mazdutide, 9mg and 6mg, to target different obesity populations. For the 9mg dose, Innovent expects to initiate a Ph3 obesity study by end-2023. The 6mg dose has also demonstrated promising results in Ph2 trial (12.6% adjusted weight loss at week 24, link), and the full Ph2 data is about to publish by end- 2023. Innovent expects to submit NDA of mazdutide (6mg) for obesity to NMPA in late 2023 or early 2024, based on the results of its Ph3 trial (GLORY-1). Mazdutide also has two Ph3 trials for diabetes. Innovent plans to release Ph2 full data in diabetes in late 2023 or early 2024 and to submit NDA for diabetes in 2024. Additionally, Innovent will initiate clinical trials of mazdutide for NASH with the IND already approved.

Maintain BUY. We see the BIC potential of mazdutide for the treatment of obesity. To factor in higher sales projections for mazdutide, we revised up our DCF-based TP to HK$57.35 from HK$50.34 (WACC: 9.6%, terminal growth rate: 4.0%).