HUTCHMED (China) Limited Q2 FY2022 earnings call

• Pipeline progress: Fruquintinib's FRESCO-2 second pivotal study and multinational MRCT is expected to have top-line results in August. Savolitinib has multiple registration studies ongoing, including global MRCT SAMETA for PRCC and SAFFRON for non-small cell lung cancer. Second wave compounds like amdizalisib, sovleplenib, and tazemetostat are in enrollment for registration studies. - Commercial capabilities: HUTCHMED China has over 800 staff, with more than 500 new hospitals covered in the first half, especially in Tier 2 and Tier 3 cities. More than 3,800 ELUNATE events and over 43,000 HCPs covered by SULANDA events were executed in the first half to mitigate COVID challenges. - Managing challenges: HUTCHMED has a solid cash balance and cash generative commercial operation in China, and the management team is experienced in dealing with challenges like surufatinib setbacks and unfavorable capital markets.

In the first half of 2022, HUTCHMED China Commercial showed strong results. ELUNATE had over $50 million in sales in the first half with a 26% growth compared to the previous year, and cumulative in-market sales reached over RMB1 billion by the end of May, holding a 43% share in third-line CRC patients. SULANDA saw sales grow 69% to $13.6 million in the first half despite a 52% price cut, with new patient numbers increasing by 280%. Savolitinib had a 46% increase in in-market sales to $23.3 million in the first half compared to the second half of the previous year.

Management maintained the earlier guidance of $160 million to $290 million for the oncology and immunology business.

• Potential COVID disruptions that could impact operations. - Regulatory uncertainties for surufatinib, including withdrawal of MAA in Europe and challenges in conducting inspections. - Unfavorable equity market conditions affecting the company's financial position and clinical program funding.

Q: Regarding the regulatory pathway for fruquintinib in the U.S., including potential issues with the U.S. patient population and data package to support U.S. approval in CRC.

A: Weiguo Su stated the strategy for fruquintinib registration in the U.S. and elsewhere is centered on the FRESCO-2 study, which is a multinational MRCT, and previous discussions with regulatory agencies have been collaborative. Marek Kania added confidence in the FRESCO-2 study covering regulatory issues across different regions.

Q: About inventory and guidance in the current macro environment.

A: Johnny Cheng said inventory is at normal levels, and concerns about COVID disruptions remain, but the team is prepared with measures like online doctors visits and inventory management. Guidance is maintained within the $160 million to $290 million range.

Q: On FRESCO-2 trial data presentation.

A: Marek Kania said the aim is to disclose important data expeditiously, with results to be presented at major conferences this year.