[Edaily Reporter Shin Ha-yeon ] On the 3rd, DaishinSecurities projected that the value of the ALT-B4 platform would be reevaluated following Alteogen Inc.(196170)’s signing of a new technology transfer agreement with Novartis. Reflecting the value of the new agreement, the firm raised its target price by 9.8% from 410,000 won to 450,000 won and maintained its “Buy” investment rating. This represents an upside potential of 50.8% compared to the previous trading day’s closing price of 298,500 won.

Hong Ga-hye, an analyst at DaishinSecurities, stated, “The high demand for ALT-B4 has been repeatedly confirmed through successive technology exports,” adding, “As the range of applicable pharmaceutical products expands in the future, new technology export opportunities and the potential market are also likely to grow, which we believe will lead to a revaluation of the ALT-B4 platform’s technological value.”

On the 2nd, Alteogen Inc. signed a license agreement with Novartis for the development and commercialization of a subcutaneous (SC) formulation of a biopharmaceutical utilizing ALT-B4. If all options are exercised and development and commercialization milestones are achieved, the company could receive up to $3.2 billion, in addition to sales royalties.

This agreement features an option structure targeting multiple targets. The contract value is expected to be specified in stages based on the selection of individual targets and the exercise of options.

Researcher Hong explained, “Although the specific targets and their number have not been disclosed, given that the agreement structure encompasses multiple products, we view this as a contract that leaves the door open for future expansion of the development program.”

In particular, he noted that this agreement has further broadened the global customer base for ALT-B4. Following agreements with GSK Holdings and Biogen earlier this year, Alteogen Inc. has now signed a new agreement with Novartis, marking a series of consecutive deals with global pharmaceutical companies. According to page 3 of the report, four ALT-B4 technology transfer agreements have been signed this year alone.

The scope of application is also expanding beyond existing antibody drugs to include antibody-drug conjugates (ADCs) and nucleic acid therapeutics.

Researcher Hong stated, “Recently, there have been ongoing efforts in the global market to expand this SC technology into various modalities, and it appears that Novartis also entered into this agreement after evaluating the applicability of ALT-B4 across multiple modalities.”

He went on to emphasize, “In this agreement, it is important to note the potential for expanding ALT-B4’s customer base and diversifying its application modalities.”

In the second half of the year, increased sales of Keytruda Qlex and the initiation of follow-up clinical trials are expected to provide additional momentum for the stock price.

Analyst Hong stated, “In the second half of the year, we expect sales milestones to increase as prescriptions for Keytruda Qlex expand, and its contribution to earnings to gradually rise.”

On the research and development (R&D) front, he predicted that Sanofi’s Dupixent SC would complete its Phase 1 clinical trial in the third quarter and enter Phase 3 in the fourth quarter. GSK Holdings’ Jemperli and Biogen’s felzartamab are also expected to enter Phase 1 clinical trials for their SC formulations in the second half of the year.

Analyst Hong commented, “As the recently signed technology transfer agreements are rapidly progressing to the clinical development stage, the development visibility of the ALT-B4 pipeline is also increasing.”

DaishinSecurities raised Alteogen Inc.’s fair value from 28.5 trillion won to 31.4 trillion won to reflect this Novartis agreement. The target price of 450,000 won was calculated using the discounted cash flow (DCF) method, which incorporates the risk-adjusted net present value (rNPV) for each pipeline.

Analyst Hong noted, “Since this agreement features an option structure covering multiple products and the specific targets have not been disclosed, we made a conservative estimate by considering the expected commercial value per target, as well as the likelihood of development and option exercise.” He added, “There is room for further upward revisions in value once the targets are finalized and clinical trials become more concrete.”