Bank of America Securities analyst David Li reiterated a Buy rating on Zai Lab (ZLAB – Research Report) today and set a price target of $31.00.
David Li has given his Buy rating due to a combination of factors related to Zai Lab’s financial performance and its pipeline of pharmaceutical products. In 2023, Zai Lab generated a total revenue of $266.7 million, marking a year-over-year growth of 25%, which aligned with forecasts. This growth was driven by the revenues from their products ZEJULA, OPTUNE, QINLOCK, NUZYRA, and VYVGART. Despite a slight decrease in gross margin due to product price reductions and the launch of VYVGART, the company saw a reduction in net losses, suggesting improved financial health. Li’s optimism is further fueled by the increased sales estimate for VYVGART starting from 2024, which is expected to contribute significantly to the company’s revenue streams.
Looking ahead, Li emphasizes the stable progress Zai Lab made in 2023 and the potential catalysts on the horizon. Key among these is the launch and inclusion of VYVGART in the National Reimbursement Drug List (NRDL), with sales projected to surpass $70 million in 2024. Additionally, several of Zai Lab’s products are under regulatory review, with expectations for approvals within the year. The company also has plans for numerous significant filings and global studies. These developments are likely to enhance the company’s product portfolio and market presence, underpinning Li’s Buy rating and price objective of $31.
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Zai Lab (ZLAB) Company Description:
Zai Lab Ltd. is a biopharmaceutical company, which engages in the licensing, developing, and commercializing proprietary therapeutics that address areas of unmet medical need. Its product pipelines include ZL-2306, ZL-2401, FPA144, ETX2514, and ZL-2301. The company was founded by Samantha Ying Du and Marietta Wu in 2014 and is headquartered in Shanghai, China.
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