DSKYF - Daiichi Sankyo Is Riding The ADC Revolution To Billions In Future Revenue

2024-06-12 03:27:58 ET

Summary

• Daiichi Sankyo is poised to play its part in revolutionizing cancer treatments with its portfolio of antibody-drug conjugates, that target $15 billion-plus annual revenue opportunities.
• Enhertu, the primary revenue driver today, has shown promising results in HER2+ breast cancer, while Dato-DXd offers billions in potential revenue from lung and breast cancer.
• Daiichi Sankyo has an attractive pipeline, including compounds in trials for small-cell lung cancer, ovarian cancer, EGFR-mutated NSCLC, as well as an emerging second-gen ADC technology portfolio.
• Profit-sharing agreements with AstraZeneca and Merck are helping Daiichi Sankyo build its business, but management intends to shift to a more independent model in the future.
• Daiichi Sankyo isn't conventionally cheap, but there aren't many large pharma companies with the potential to grow earnings at 25% or more in the coming years, and the shares do have some appeal.

Antibody-drug conjugates (or ADCs) are enjoying a renaissance today, and as one of the leading independent developers of ADCs, Japan’s Daiichi Sankyo (DSKYF)(DSNKY)(4568.T) stands to benefit tremendously in the coming decade as lead drugs like Enhertu and Dato-DXd target $15B or more in annual potential revenue and fund a robust pipeline of next-gen assets that could offer even better efficacy and tolerability data....

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