[Click eStock] Rigachem Bio, Follow-up Package Deal Expected... Target Price Raised to 170,000 KRW+

Meritz Securities announced on the 11th that it has raised the target price for Rigakem Bio to 170,000 KRW and maintained a 'Buy' investment rating.

In a report released that day, Junyoung Kim, a researcher at Meritz Securities, explained, "The upcoming license agreements are increasingly likely to be concluded as package deals. Accordingly, we have raised the platform value, which previously reflected 15% of the total platform contract size, to 30%, and thus raised the fair target price to 170,000 KRW."

Rigakem Bio announced that it signed two technology transfer agreements with Ono Pharmaceutical in Japan the previous day. The disclosed contract value alone amounts to approximately 700 million USD (about 943.5 billion KRW).

Researcher Junyoung Kim stated, "Despite having preclinical pipelines that have not yet entered clinical trials, the company has signed pipeline contracts worth about 940 billion KRW, and although the contract size has not been disclosed, it is expected that platform contracts of similar scale to previous agreements have been signed, achieving at least one license agreement annually since 2019."

He added, "According to the disclosure on the 10th, there is potential for an increase in contract size if an L1CAM-targeting ADC with a different combination payload other than the existing MMAE payload is developed. Currently, the payloads with research results disclosed in preclinical stages are MMAE, PBD, and Exatecan (Topoisomerase 1 inhibitor), and at the June briefing, the possibility of expanding new payloads was hinted at, so ADCs with other combinations could sufficiently emerge."