HUTCHMED (China) Limited

Good day and thank you for standing by. Welcome to HutchMet 2023 Half-Year Financial Results presentation. At this time, all participants are in listen-only mode. After speaker's presentation, there will be question and answer session. To ask a question during this session, you will need to press star 1 1 on your telephone. You will then hear an automated message advising your hand is raised. To record your question, please press star 1 1 again. Please be advised that today's conference is being recorded. And I'd like to hand the conference over to Mr. Mark Lee, Senior Vice President, Corporate Finance and Development of Hatchmat. Please go ahead, sir.

Thank you, Amber. Thank you, everybody, and welcome. At this time, I will remind you that the statements we have are forward-looking in nature, and the results and operations of the Hatchmat Group are historical, and past performance is no guarantee whatsoever. of future results and that this presentation is intended for investors only and should be read in conjunction with the announcement we just made regarding the results for the six months ended June 30th, 2023 and our various other filings and annual reports. Now I'll hand you over to Dr. Weiguo Su, our Chief Executive Officer and Chief Science Officer.

Thank you, Mark. Good evening. Good morning, everyone. Welcome to HMET first half 2023 results conference call. Next slide, please. During the first half of 2023, we focused on executing on our strategy for the long-term growth and also reaching profitability by 2025 goal, including China commercial growth and spending control. We also delivered on our key objectives with our pipeline. highlighted by frequenting the U.S. NDA and EU MAA submissions and advancement of multiple programs into pivotal registration studies, including salvalitinib second-line gastric and also HMPL453, our selective FGFR1, 2, and 3 inhibitor in second-line cholangiocarcinoma. Frequenting the U.S. NDA was granted priority reviews designation with a PDUFA date of November 30th, 2023. That means a potential approval before end of 2023. We are working with our partner Takeda closely to prepare for the launch in the U.S. China commercial of the three approved oncology products continues to grow in spite of the pandemic outbreak at the beginning of the year. Next slide. Today, I'm joined by the Hutchman Senior Management Team. Johnny Chan will lead off with a financial update. Johnny, over to you.

Thank you, Dr. Xu. May I turn to page 5, please? Yeah. Okay, a quick review of our balance sheet. Two points I would like to highlight here. One is that we have a strong cash position of over $850 million, mainly contributed by the $400 million upfront payment from Takeda. Secondly, we have completed the construction of our Shanghai factory, of which we have utilized a banking facility supported by the local authorities. This results in a loan balance of about $14 million, at favorable interest rates of around 3.5%, which is much lower than our deposit rates from the cash debt that we have on hand. Moving on to page six to review our financial performance. Our consolidated revenue up by 164%, from around 200 million to over 530 million. mainly contributed by the recognition of the upfront income from Takeda, around 260 million. Our oncology product sales maintain strong growth of 35% at constant exchange rate. The improvement of our other venture business have also contributed to the overall revenue growth. So on the bottom line, net income to HatchMap has improved significantly. From a net loss of 163 million to a net profit of over $168 million. In addition to the recognition of upfront income from the Decatur deal, reduction of R&D expenditure resulting from the portfolio prioritization and restructuring of our U.S. operation, as well as a higher interest income from our strong cash balance, have contributed to the improvement on the bottom line. Moving on to page seven, Our oncology product sales, as mentioned earlier, has maintained a high growth of 35% to $80 million. So overall, our oncology business in total has achieved around $360 million of revenue, three times higher than last year. So we are on track to meet our guidance set at the beginning of the year, that is around $450 to $550 million revenue for the full year. I will now pass to our Chief Commercial Officer, Chan Hong, to share with you the details of our commercial business performance.

Thank you, Johnny. Good morning, good evening, everyone. I'm happy to update you on HatchMed's commercial performance in the first half of 2023. As a global science-focused biopharma company, HatchMed fully integrated R&D and commercialization platform. HatchMed built up its own oncology commercial platform since 2018 and continuously improved the commercial capabilities and efficiencies. By the end of June 2023, the sales team size was close to 1,000, covering more than 3,000 hospitals and over 33,000 oncology specialists. Meanwhile, the government continues to introduce policies to encourage innovative drug development and benefit new drug access to patients, including the implementation of dual-channel pharmacies and the simplification of NRDL renewal process, et cetera. Next slide, please. Annulate was approved for the treatment of third-line MCRC in 2018, although 2023 is the first year for Annulate to be listed in NRDL. It's still keeping strong growth in the first half of this year. We estimate that there were about 17,000 new patients were treated with annulate in China in the first half, with 21% growth. According to a quiver tracking study report, annulate surpassed regorafenib in terms of patient share since the end of 2021, and that led to growth to about 47% patient share at the end of June 2023. This resulted in 56.3 million US dollar in market sales, up to 12% growth, which is about 20% at the CER growth versus the first half of last year. Next slide, please. Solenda. Solenda was launched in China in 2021 for the treatment of all advanced NAD patients. The in-market sales growth in 2022 was very strong, being the first year in NADL. As a result of our continuous marketing activities, increasing patient access to Solenda and its long duration of treatment, The total in-market sales in the first half of 2023 accelerated, going by 6% to around US$22.6 million, with an estimated 12,000 new patients treated. According to the Equivalent Tracking Study report, in the first quarter, Solenda had higher patient share than Sulten and Affinital, which were approved in China much earlier than Solenda. Next slide, please. Opacis is the first in-class selective MET inhibitor to be approved in China and the market by our partner AstraZeneca in 2021. Following negotiation with China NHSA in January this year, Opacis has been included in the update NRDL since March 1st with a 38% discount. The delayed implementation of NRDL plus the price reduction led to the flat sales in the first half of this year with about minus 5% growth in U.S. dollars and 2% growth at CER. However, we can see the volume sales grew very strong in Q2, up to 84% comparing to the second quarter of last year. So in summary, all our three market products are now included in NRDL. which is in line with our commitment to improve patient access. Despite some initial challenges in the first quarter due to the impact of COVID-19, the in-market sales of HatchMed's three novel products continue to grow at 16% to $101 million in the first half of this year. That's all for my part. Thank you.

Chen Ping will cover manufacturing update. Chen Ping?

Weiguo, perhaps you, I think he's having some technology problems. Perhaps you go ahead.

All right, so yeah, I'll... cover for Jinping. Basically, as you know, we've been building our new factory in Shanghai. At the moment, construction is complete. We are going through equipment validation and also applied for a compliance license and we should be able to initiate clinical supply manufacturing later this year. And at the same time, we will be initiating tech transfer of our commercialized products for this new factory to start commercial manufacturing as well in the future. We're also installing solar panels to be more energy efficient. Next up is Mike to update the pipeline. Mike.

Thank you, Weiguo. Slide 13, please. Yet our clinical programs continue to grow and mature and cover a broad spectrum of hematology oncology products. And this slide lists a 15-plus ongoing registration trial for seven leading products globally, including life cycle indication of market products and late-stage assets with the anticipated NDF filing time in the next few years. Fuquininib, salvalidinib, and sulfatinib are already on the market in China, and two are in global partnership with Takeda and the AZ. And HatchMed is leading the development of multiple life cycle indications for these products in China, which I'll allude you to. Our next wave of late-stage compounds in registration trials are also in the hematology space, and two compounds received breakthrough therapy destinations in China. Salvoplantib in immune thrombocytopenia, ITP, and MD-Xelazep, our PI3Q Delta inhibitor in third-line follicular lymphoma. And the EZH2 inhibitor Tasmetastat is a first-in-license product from Ipsen, and we are doing a bridging study on registration in China. And notably, new to the list is HMPL453, listed in the bottom here, is our FGFR inhibitor and also entered a registration trial in intrahepatic cholangiocarcinoma, and leading our third wave product into the registration trial. Next slide, slide 14. And frequent and global regulatory following has been going on very well, and which is supported by the results of FRESCO 2 and recently published in Lancet, and also the data from FRESCO, the China registration trial. So, NDA for frequentative, Dr. Su already mentioned, granted a priority review by the US FDA, and PDUFA date is November 30th. And MAA validation has been accepted by EMA in June, and also we work our partner, Takeda, is doing the Japan filing later this year. Next slide. And the Fucuna partnership with Takeda has been progressing very well. And Johnny already mentioned we received the upfront payment of $400 million. And also, the joint team established and started the collaboration already. And our NDA filing, the MMA and Japan NDAs as well on Target, and also on the commercial front. Takeda is initiating launch readiness in advance for the Purdue for Day. So, and also regulatory and life cycle indication part and join the Takeda HACMED team already in discussion and also with our external advisors to be held to discuss the LCM strategy and HACMED is ongoing clinical program in China may also help inform our clinical development decisions. Slide 16. And for quininep, NDF for the second-line gastric cancer is already accepted in China. And this is based on the Futica second-line gastric cancer trial, met one of the dual primary endpoint, the PFS, which is the discipline and clinically meaningful. And the other primary endpoint of OS was not a statistically significant per pre-specified statistical plan. So we complete our SNDF filing, and the NDA has been accepted by MMPA in April. We hope to extend the patients serving gastric cancer with this high unmet need. Slide 17. On the fucrinib life cycle indication development, We are also very pleased to receive the Breakthrough Therapy designation in China for the combination with centilimab, the PD-1, from Inovan. In July, for the treatment of advanced endometrial cancer with a proficient mismatch repair subtype. And EMC incidence and mortality of projectiles grow in China, and the patient who progressed on the first-line therapy remained with high unmet medical needs. And we have completed the single-arm registration phase two study, and if the favorable results from this trial could lead to the regulatory approval in this treatment setting. Next slide. Slide 18. Solvoplanet is the highly differentiated R16 inhibitor with breakthrough therapy destination in ITP in China. We are particularly encouraged with our Phase I-II results to demonstrate the robust overall response rate of 80% and the durable response rate of 40% in relapsed or fractured primary ATP patients. These high response rates are on par with the current widely used second-line treatment for ITPs such as TPO-RA, and the same response rate has been shown in patients with a previously treated with TPOA or not, and much higher than that, the existing sick inhibitor, Talalysi, in this setting. So we believe SolvoClanid has the best-in-class potential in the ITP setting, and the results for Phase I study was already published in the Landsat Hematology in April this year, and we have complete enrollment of ITP Phase III registration trial, ISLM-1, and expect the top-line results in sesquicam. So if positive, we prepare the NDF following in China later this year. Next slide. Slide 19. And as well as that, our differentiated PI3K delta inhibitor is currently going on with two single-arm phase II registration study in China in the third-line follicular lymphoma and second-line marginal zone lymphoma. The updated Phase I data were presented at International Congress on Malignant Lymphoma in June this year. Demonstrated compound is not only promising efficacy with high oral response rate, 4-month PFS rate, and duration response rate in lymphoma and MZ, but also favorably safety profile when compared with the same class of compound. as highlighted with the low incidence of AEF interest, as well as a low discontinuity rate on the treatment. So this, of course, needs to be further confirmed in a larger patient population. I'm very pleased we have completed enrollment for this peripheral trial in follicular lymphoma earlier this year, and with the clinical readout and the potential NDA following later this year. Next slide. There are seven registration trials for our MET inhibitor, savalitinib, and all currently enrolling. And three are led by our partner, AstraZeneca, globally, and four led by Hachimed in China in multiple cancers with MET operations, including non-small cell lung cancer and popular renal cell carcinoma. In addition, we have entered a registration phase in gastric cancer with meta-amplification of the POC trial results presented earlier at ACR this year. Next slide. Our innovative early-stage pipeline continues to grow, and here are only a few examples. And I mentioned earlier HMPL-453, The FGFR inhibitor has entered registration trial in the cholangiocarcinoma after discussion and in agreement with the CDE. And the clinical proof of concept study were presented at ASCO this year. And the clinical POC data for HMPel306, our IDH1 and 2 dual inhibitor also presented at EHAR this year. The randomized phase two dose has been determined, and we'll consult with the CDE on the registration path forward. We also initiated a combination of a trial of a test metastat and also PS3K delta inhibitor endozelecid in molecular hematology indications. Also, nose mentioning is the newest addition to our early stage pipeline. including a differentiated SHP2 inhibitor, HMPL415. Next slide. I'm very proud our R&D team remained focused and executed very well for the first half of the year. On the regulatory activity, we submitted regulatory filing for focundinib and all on target with our partner. And also, the Japan third line CRC is also in preparation. We have submitted a supplemental NDA filing for, as I mentioned earlier, for the gastric cancer indication for fuquitinib, and MNDVA already accepted our application. And we received breakthrough designation for fuquitinib plus centilimab in the second line of individual cancer. I also want to mention here, and following the dialogue with the PMDA regarding the surafatinib, we have decided now to file a Japanese NDA for neuroendocrine tumor on the basis of clinical trial data available. And we also anticipate data readout potential NDA filing in China for salvo-planted second-line plus, ITP, and the endozelecet for third-line follicular lymphoma based on the pivotal trial. And also, subolidinib first-line non-SMART cells, lung cancer, patient with MEDISON14 mutation. First-line data will be presented in September at WCLC. And also, we anticipate, you know, the individual cancer readout. On the development side, And HodgeMed and our partner, AZ, will continue to complete the enrollment of multiple registration trial for salvalentabine non-spore cell lung indications. And we also will complete enrollment for quinidine plus centilimab in the renal cell carcinoma. And the HIM product will complete the enrollment for ambizelazep in the second-line Enveon, and Tasmidastep, a bridging study for third-line follicular lymphoma. We present a clinical readout for salvolitinib in second-line gastric cancer in metamplified patients at AACR, and the initiative registration trial for salvo in the metamplified gastric cancer. And also, we have completed enrollment salvo-planted phase two part of the second-line warm autoimmune hemolytic anemia indication, and we'll decide for the phase three of the data readout. So to recap our R&D progress, HodgeMed has a deep and broad portfolio and multiple near-term development catalysts in 2023 and 2024. So our R&D team will remain sharply focused on the execution of our late-stage product development. So with that, I wrap up my part of the presentation. I'll turn the podium to Dr. Weiguo Xu, our CEO and CSO. Weiguo?

Thank you, Mike. Next slide, slide 23, a reminder of our near-term goal of turning profitable by 2025. Obviously, we are focused on growing our China business, China commercial, at the same time managing and controlling the spending. together, hopefully, will allow us to achieve our goal of break even or profit or being profitable by 2025. And next slide, slide number 24. Now, to just sum it up, we had a very strong first half of 2023. We will continue to focus on our near-term goal. and we are confident that we will be able to deliver on these goals because we have a broad pipeline and we are working on multiple, on very extensive and robust life cycle indications for our first wave of compounds, namely fruquentinib, sablatinib, and surafetinib, both in China and outside China. At the same time, we are also working to file and register, basically, these compounds outside China for global patients. Secondly, we are working to file for approval in China our second wave of compounds, including Sovloplanet, M. desolaceb, and Tazmetastat, in the next 6 to 12 months. By 2025, we expect to have at least six compounds approved and launched in China. At the same time, we expect our third wave of compounds to enter into pivotal registration studies in China in the next six to nine months, led by HMPL453, our selective FGFR12N3 inhibitor. All of these will present opportunities for NDA submissions in 2025 through 2027 and will position us for long-term growth. Overall, I'm quite happy that we had a very strong first half of 2023, and we are quite excited about our long-term prospects given this extensive pipeline. So this will conclude the presentation and we'll be happy to take any questions.

Thank you. We will now begin the question and answer session. To ask a question, please press star one one on your telephone and white for your name to be announced. To withdraw your question, please press star one one again. Our first question comes from the line of Kelly Shi from Jefferies. Please go ahead, Kelly.

Kelly, your line is open. Please ask your question.

All right, we are not getting response from Kelly. I'll move on to the next question. Our next question comes from the line of Alex Stranahan from Bank of America. Please ask your question, Alex.

Hey, guys. Good morning slash good evening. Can you hear me?

Yes.

Great. So thanks for taking our questions. Two from us. First, could you help frame... the scope of the top line for solvoplanib and ambizolizib in the second half, you know, in terms of number of patients and follow-up on the primary endpoints from those studies? And then I've got a follow-up. Thanks.

Yeah. So solvoplanib in ITP, it is a phase three randomized placebo-controlled study. And in terms of the top line readout, we expect second half this year actually should be fairly soon. We'll obviously announce in due course. Specifically, with regard to patient sample size, it is a total of 180 plus patients randomized 2 to 1. in the two, in solvoplanet and placebo arms, the durable overall response rate will be the primary endpoint. So that is about ITP for solvoplanet. M. desalicib, there are two, actually there are two pivotal studies ongoing. Both are single-arm studies. with overall response rate as a primary endpoint. So, follicular, third line follicular, we completed enrollment, which is around 100 patients, and the readout should be towards the end of this year.

Okay. And would the plan be to present those around a scientific meeting or whenever the data is available, you'll update the market?

Yeah, of course. Yeah.

Okay. And one last question, if I may, just on the commercial readiness activities for frequent nib. Could you help us paint the picture of what Takeda is doing currently to prepare for the launch in the U.S.? ? And from your side on manufacturing, you know, maybe help us understand, you know, whether that would be in China or, you know, if you would shift manufacturing to other sites to help support the launch. Thanks.

Okay, thanks, Alex. Yeah, you know, we've been working with Togeda just to support them on the launch readiness, and obviously they're driving that – the activities. Maybe I'll ask Karen to provide some more details on the preparation from Takeda's side. In terms of manufacturing, we qualify two sites for drug product supply. One is obviously our Hachmet factory or plant in Suzhou, China. The other is in Covet, Switzerland. So obviously, we are going through pre-approval inspections and so forth. So likely, the Suzhou plant will be the initial supplier. And ultimately, the two sites will be supplying global markets. Karen, can you talk a little bit about launch readiness?

We're working very closely with Takeda. I think they plan, assuming that the outcome of the FDA review is positive, to be ready to go as soon as we have a positive outcome. They've already hired the medical team and the marketing team and are now doing the detailed planning from sales and commercial perspective as well. So I think they're taking this very seriously. It's a very important product for them, and we're confident that they will be ready to launch as soon as we know the outcome from the FDA.

Thank you.

Back to you, Abel.

Yeah, thank you, Karen.

Thank you. Do you have any follow-up, Alec?

That's great. Thank you.

Thank you. Our next question comes from the line of Mike Mitchell from Pembroke Garden. Please go ahead, Mike.

Hi there, everyone. Yeah, thanks for taking my questions. First, I was just wondering how the relationship with Takeda might potentially be catalyzing other aspects of business developments. You know, obviously the focus right now is for Quintinib, but then I think there's a wide and deep pipeline within HutchMed. So does that provide a basis for more expansive discussions with Takeda, or do you envisage potentially the deal sort of generating further interest in the pipeline from other third parties?

I mean, obviously, Takeda is a very strong potential partner. We are working with them at the moment on frequent. They are, you know, a great partner to work with. And, yeah, you know, obviously we always constantly talk about potential opportunities for collaborations. And, you know, so, you know, I wouldn't, I think it's all project-based. Yes, we have a very broad and deep pipeline, but it's all about pipeline fit or synergy, if you will. We're just very happy at the moment working with them on Frequentinib, and we'll definitely explore other opportunities when all compounds progress through clinical development when the time is right. Thanks.

Got it. Thanks. Perhaps I can just follow up with another question just in terms of third-party relationships. Just with AZ, I think we saw earlier in the year some press speculation on potentially how AZ might evolve its China operations in the future. wondering how you think about that in terms of how any changes in terms of spin-offs or other restructuring of Asia-China operations, whether or not anything happens, how that might change your relationship, and particularly in terms of development of satellite. How are the structures set up in order to be flexed, basically?

Changes are constant for almost every company, but Specifically for AstraZeneca China, we don't think there is any basis. We believe it's just a rumor. So at the moment, nothing has changed in our relationship with AstraZeneca. It's all playing out according to our original contract.

Fantastic. Thanks for that. And perhaps I can just finish with just one final quick one just on COVID. in terms of the commentary around the sort of impact on Q1. Just wondering if you've been saying anything further into Q2 or even with the current quarter, just in terms of COVID. I admit I've kind of taken my focus away from COVID impact in recent months, but that would be very helpful. Thank you.

Yeah, generally speaking, the COVID impact was early part of first quarter, January in particular. So it was a bit soft the first quarter. Second quarter, things now seem to return to normal. We are seeing the trend of things picking up. So we don't expect any major issues from the second quarter now. So yeah, pretty much back to normal.

Got it. That's great. Thanks, guys. Thanks, everyone.

Thank you. Our next question comes from the line of Louis Chen from Canto Fixjar. Please ask your question, Louis.

Hi, this is Wayne Alfa-Luis. Congrats on the progress, and thanks for taking our questions. We have two. The first question is on the subalternative. In the press release, you mentioned you might profit into the phase one in ITP in the U.S. depending on the outcome of the China phase three data. So what do you need to see here in order to move into the U.S. study? And how is it differentiated from the other mechanism of action such as SCRN? And then the second question is, can you discuss your strategy for further build out in the hematology space moving forward, given you already have six investigational drug candidates targeting the hematological malignancies in clinical development? Thank you.

Okay, thanks for the question, Wei. I think specifically for the U.S. strategy for Solve the Planet, or for autoimmune diseases. I think the ITP in China would be a major catalyst. If the phase three top-line results recapitulates our phase one, two data, I think it would represent a very strong opportunity for global market, we believe, would expedite the process to initiate our phase one, U.S. phase one for autoimmune disease. We do have an active IND in the U.S., but we do need to quickly confirm the recommended phase two dose for U.S. patient population or for global patient population, for that matter. So, you know, we believe it is a highly differentiated oral sick inhibitor. And the data we presented or published now for sublopinib in phase one slash two clearly demonstrated superior efficacy and much improved safety comparing to Fos-tomatinib, which is the only sick inhibitor approved. So we would, you know, we believe there would be a clear opportunity for solve the planet in autoimmune disease space and we definitely would invest to to you know follow the China studies in China we are already evaluating the landscape and if the ITP is positive readout phase 3 in China we would follow with additional life cycle indications for solve the planet, and the U.S. will catch up once the dose is confirmed. With regard to hematology, we are evaluating the space. I think the space has changed a lot now with the bispecifics and CAR-T ADC as well. So we are evaluating the potential opportunities for the sick inhibitors. but clearly it is now much more crowded comparing to two or three years ago.

Okay, thank you so much.

Thank you. And the next question will come from the line of Paul Choi from Goldman Sachs. Please go ahead, Paul.

Thank you. Good morning and good evening, everyone. My first question is on Savolitinib with regard to the Savannah trial. Can you remind us if there will be an interim update for that study and when that might come, or are you going to run that study just to completion ahead of a potential filing for an accelerated approval? And then I had a couple follow-ups.

We don't think we have an interim update. analysis built into the current Phase II registration study, Savannah study. So it would be just, you know, it's a relatively small study, so it will be just, you know, straight enrollment into completion and then report out.

Okay. Got it. Thanks for that. My second question is to follow up on the earlier question regarding the Takeda collaboration and commercialization in the U.S. Can you remind us if your 2023 oncology guidance is inclusive of any sales post an approval here in the U.S., or should we assume that the first sale would likely come in 2024?

There is no royalties built into our guideline for 2023, specifically for Quentinip US sales. The priority review status and PDUFA data before end of the year all just played out. We did not build into our guidance.

Okay, great. Thanks for clarifying that. And my last one is on just regarding collaboration and lifecycle development with Takeda for Quintinib. When do you think you might be in a position with your partner to talk about the development path and markets outside of China for that? And can you remind us of how the cost sharing is going to work there for future clinical development? Thank you very much.

Yeah, so first on the cost, obviously it will be 100% covered by Takeda. With regard to specific indications to pursue, we've been in discussion with Takeda team. There are obviously a few that we are interested in. or Takeda is interested in as well. So we continue to evaluate the opportunities and also leveraging many proof of concept studies, reading it out in China as well. So overall, the joint teams have been working together and evaluating different opportunities. We just need to finalize the plan. Maybe, Mike, you can chime in on this.

Yeah, we have been in active discussion with the TAGEDA team. I think it's from medical perspective, right? We really focus on quite a few, you know, indications, right? I think both we have shared the China, you know, both HACMED study and also IIT results. Both teams are very engaged, and we're also consulting with external KOLs, right, medical experts, really hope we can shape up some, you know, indication for future development. So I think both teams are continuing to work on that.

Great. Thank you.

Great. Thank you, Paul. Our next question will come from the line of Matthew Yan from CLSA. Please ask your question, Matthew.

Hi, thanks for taking my question and congratulate on the results. I got three questions. First is regarding APASIS, the separate study. I know that it's expected to complete recruitment by end of this year. So do you have any plan for any redial for this trial and also the follow-up NDA filing supported by Zebram. And my second question is regarding the other venture. I noticed that it grew very strong in first half. So can you share more color on this? And then my third question is, I think it's quite a concern for a lot of investors over the weekend is that the central commission for the discipline inspection in China has some talk on the anti-corruption campaign of the healthcare industry in China. So I wonder if there is any impact on your commercialization activities regarding this. Yeah, that's my question. Thanks.

So your first question on the ongoing, obviously it's an ongoing trial and not only just enrollment, but also PFS follow-up and so forth. So we don't really anticipate any interim report of the results of any ongoing trials. So I don't, for this one as well, I don't anticipate any reports or publications anytime soon until PFS is mature. Your last question about commercial anti-corruption and so forth, HACMED is always highly compliant with global quality, global standards of compliance. So we don't expect any major impact on our commercial operations. What was your specific for your second question?

Well, the other vendors grew by over 50%. So in the first half.

Sorry, just related to the logistic distribution business, Dr. Shou.

Okay, maybe Johnny, you can provide some more details on this.

Yeah, basically, I think the key contributor for the other ventures growth in the first half is related to the growth of our logistic distribution business. So our commercial team there have continued to receive good interactions with new customers. So we have been able to do this logistic distribution work really well in Shanghai region. So that's contributed to the growth. It's a relatively low-margin business, so I think the key importance is our oncology product sales growth that has reported 35% growth in the first half.

Okay, thank you.

Thank you, Matthew.

Our next question comes from the line of Jack Lin from Morgan Stanley. Please ask your question, Jack.

Hi, hello, can you hear me? Yep. Hi, thank you for having me for one of the questions. So I just create three quick questions. I think one or two are kind of follow up to previous question. So the first one is kind of back to the sub-planet in terms of the phase three readout. I was wondering how how should the investors and analysts like us frame the top line results compared to the result that we're being seen for the phase one and two, considering there's a bit different patient enrollment in terms of your line of previous treatments? That's the first one. The second question is in terms of the commercial strategy for Southwest Fund and also, Andy, that was considering the indication that there'll be launching is a bit different from kind of the existing product. Are we looking to, establish new teams or using existing teams, or will we be looking for partnerships for their commercialization? And I think one final one is just on the kind of the commercial dynamics for Zolanda domestic. I see that the slides I mentioned, there's 12,000 new patients that was treated the first half of this year. So it's a significant increase from last year. While it looks like on the market share side, the majority of market sharing actually went to others compared to the PowerPoint slides at the four-year results. I remember I was just checking. It looks like for Celenda, it went from 16% to 17%, while other went from, I think, 18% to 23%. Just wondering what's the competitive dynamic in this space right now and if it will be any challenge to continue growing the shares in this market. That's all. Thank you.

Okay. Thanks for the questions. So, Solve the Planet Phase 3 readouts I think you already seen our phase one slash two results, 80% overall response rate and 40% durable overall response rate. These are obviously very strong results, but very small sample sizes here as well. So I think what it would make Solve the Planet stand out is its oral convenient dosing and fast onset of activity. 80% is very robust activity for these patients, you know, heavily pretreated patients. So, and it's, you know, it's open arm, very, you know, very small study. So here we, the phase three, it's randomized placebo controlled. You know, if these data can be recapitulated, it would be very strong data, not only comparing to compound in the same class, but also comparing to any treatment available for ITP patients. These are, you know, obviously refractory highly refractory patients. So I think we need to look at the level of efficacy, but at the same time a safety profile as well. We already pointed out early on that we have very low risk of thrombosis thrombosis, basically, you know, with blood clotting formation with typically seen with TIPO or TIPO-RA therapies, and it represents a very severe potential side effect. So sick inhibitors of silver planet, so far we've seen very We have not seen any cases of thrombosis to date and would represent a very low risk there. So, you know, strong efficacy coupled with good safety profile, low risk of thrombosis, and also fast onset of efficacy that would differentiate solar planet from the current currently available therapies and would make it a very competitive product in this category or in this patient population. Commercial strategy, it is an autoimmune disease. However, these are patients typically in hematology space. A lot of physicians are in hematology, hematologic malignancies like, you know, lymphoma, leukemia, as we talked, you know. So even though the ITP is not a hematologic malignancy, but a lot of doctors or even in the hospital, they are treated by hematologic malignancy physicians. We definitely will have a dedicated team for this indication, but a lot of doctors or physicians will be in the same hematology space, if you will. I think you see a lot of big, we're growing the patient numbers. And you have to understand the neuroendocrine tumors and also the treatments available. This is a very highly fragmented disease with different They can originate from different tissues or different organs. And also, the hallmark for this disease is that you typically don't see very high response rates. What happens is that patients experience, many of them, the majority of them experience stable disease. So they can control the disease. They sometimes see some tumor shrinkage or tumor regression, but not to the point of response. Oftentimes, they rotate on. They rotate on to some other treatments, and then they come back to the same treatment, to Celenda, for instance. So there's definitely some rotation going on. By far, what we are, you know, patients treated so far with Celenda, by far majority are neuroendocrine tumor patients.

Got it. Understood. Thanks so much.

Okay.

Thank you, Jack. We will now take our final question from the line of Clara Dome Jeffries. Please ask your question, Clara.

Hi, can you hear me? Yep. Great. This is Clara on for Kelly. Congrats on the progress and thanks for taking my question. So just a question on for Cusinib. So in ASCO, you showed subgroup analysis of Cusinib including overall survival in patients across different lines. So could you maybe talk about the timeline and development plan to support the earlier line approval and use a new plan to run additional studies?

Yeah, I'll ask Mike to comment on this. Mike?

Yeah, so this is part of our line.

Earlier lines of CRC. Yeah.

Right, so life cycle management indication discussion, as I mentioned earlier, we've been actively in discussion with Takeda on the LCM plan, right? So certainly earlier line of indication is also what we are considering. And so at this point, we're further evaluating data. Let's mention we certainly have some China data show earlier line, you know, can be combined with, you know, chemo, immunotherapy, demonstrate signs of clinical activity and the safety. So, certainly, moving to earlier lines of possibility, but we'll still continue to discuss and evaluate this Takeda.

Thank you. Thanks.

Thank you. Thank you all very much for your questions. I'll now turn the conference back to our speakers for any closing remarks.

Mark, do you have any comments or to sum it up?

Thank you, everybody, for joining. Weiguo, do you have any comments?

No, not from me.

Okay, thank you, everybody, for joining. And should you have any questions, please feel free to contact us Happy to answer your questions or organize a meeting if there's anything that's not clear in anything we've spoken about today. Thank you all.

Thank you. That concludes today's conference call. Thank you for participating. You may now disconnect.