[Click eStock] "HK Innoen, Stock Price Plunge Attributed to Passome Pharma Issue... Target Price Down"

On the 27th, Korea Investment & Securities estimated that the recent sharp decline in HK Innoen's stock price was due to the issue surrounding Passum Pharma raised in the United States, and downgraded the value of K-CAB in the US market. The target price was lowered by 28.6% to 70,000 KRW, while maintaining a 'Buy' rating.

Researcher Wi Haeju stated, "HK Innoen's stock price has fallen 13% over the past month," and added, "It is presumed to have been influenced by Passum Pharma, a P-CAB competitor whose stock price dropped 47% during the same period."

Wi further noted, "Passum Pharma's stock price plummeted over three days starting November 8th US time without any apparent issues," and "There was no news explaining the plunge, and their earnings were solid."

In fact, sales of Bonoprazan prescriptions increased by 120% compared to the previous quarter, reaching $14.6 million in three quarters since the prescription began, with the number of prescriptions rising 138% to 143,000. The Phase 2 clinical trial for on-demand treatment of non-erosive esophagitis won the American College of Gastroenterology (ACG) Outstanding Research Award, indicating strong academic interest in P-CAB.

Researcher Wi Haeju analyzed, "The cause of Passum's stock price decline is presumed to be a cost-effectiveness issue related to P-CAB (currently Bonoprazan)." He confirmed this through a commentary published in the NEJM Journal Watch on October 31st, noting a roughly nine-day delay between the commentary's publication and Passum's stock price drop.

He added, "The commentary revealed that the American Gastroenterological Association (AGA) currently questions the efficacy of Bonoprazan's pricing (average wholesale price of $750 per month) and recognizes that the number of Bonoprazan prescriptions may decrease compared to before."

He also drew a clear line regarding domestic concerns about the entry of Bonoprazan generics, stating, "The concern about Bonoprazan generic entry is unfounded." He explained, "Bonoprazan, as a New Chemical Entity (NCE), is protected from generic entry through exclusivity granted by the U.S. Food and Drug Administration (FDA) until May 3, 2032, regardless of indication."

However, the recent target price downgrade reflects the potential contraction of the U.S. P-CAB market. The AGA acknowledges Bonoprazan's comparative efficacy in severe erosive esophagitis, usefulness in on-demand treatment, comparative advantage in Helicobacter pylori eradication therapy, and utility in hemorrhagic duodenal ulcers. Nonetheless, due to a lack of long-term safety data and comparative results, it recommends restricting prescriptions for non-erosive and early erosive esophagitis patients mainly to those unresponsive to proton pump inhibitors (PPIs).

Researcher Wi concluded, "Following the AGA guidelines, we have lowered K-CAB's U.S. value to 501.3 billion KRW and HK Innoen's target price by 28.6% to 70,000 KRW." He added, "Separately from the U.S., the domestic P-CAB market is growing without pricing controversies, so there is no change in the operating value of K-CAB and HK Innoen."