Kiwoom Securities raised its target price for Hanmi Pharmaceutical by 25.9% to 730,000 won from 580,000 won. It said the company reaffirmed its research and development (R&D) competitiveness by signing a large-scale technology transfer deal with Roche Group's Genentech just three months after Eli Lilly in June. It maintained a "buy" rating. Hanmi Pharmaceutical closed at 540,000 won in the previous session.
Heo Hyemin, an analyst at Kiwoom Securities, said in a report on the 25th that the target price was raised to 730,000 won by newly reflecting the new-drug value of the non-incretin UCN-2 analog "HM17321," developed in-house by Hanmi Pharmaceutical.
Hanmi Pharmaceutical said the previous day it transferred technology for HM17321 to Genentech. The upfront payment is $190 million (about 262.9 billion won), and the maximum milestones total $2.1 billion (about 2.9263 trillion won), bringing the overall deal size to about $2.3 billion (3.2 trillion won). Following the technology transfer news, Hanmi Pharmaceutical hit the upper limit the previous day, lifting its market capitalization by about 1.6 trillion won.
In particular, HM17321 is a pipeline solely developed by Hanmi Pharmaceutical, and it was seen as positive that there is no profit-sharing issue of splitting the upfront payment with Hanmi Science. It is currently in phase 1, and according to ClinicalTrials.gov, completion is scheduled for March 2027.
Kiwoom Securities pointed to the "muscle preservation and increase" effect as the reason Genentech paid a $190 million upfront for HM17321, which is in the early clinical stage. Existing incretin-based obesity treatments have the limitation that, in the process of reducing weight, not only fat but also muscle and lean mass can decline together. By contrast, HM17321 reduced body fat while increasing lean mass and muscle mass in preclinical studies.
Heo analyzed that Genentech is positioning body composition improvement, rather than a simple race on weight-loss rate, as the main differentiation strategy for obesity treatments. Genentech is already developing the myostatin inhibitor "emugrolbat" in the obesity field, and by adding the mechanistically distinct UCN-2, it has strengthened its muscle preservation and increase pipeline.
Accordingly, Genentech's obesity portfolio now includes "ensifepatide (GLP-1/GIP)" for weight loss, "petrelinatide (amylin)" for tolerability and combination use, oral "CT-996 (GLP-1)," and HM17321 targeting muscle increase and body composition improvement.
Heo said, "Despite being in the initial phase 1 stage, paying a $190 million upfront suggests a strong assessment of UCN-2's differentiated mechanism and its future potential for combination therapy."
However, because it has not yet been decided at what point in the third or fourth quarter the HM17321 upfront will be recognized, and whether in a lump sum or via partitioning, it was not included in the earnings estimates. Instead, Kiwoom Securities raised the target price by newly reflecting HM17321's new-drug value.