Canfang Bio’s HARMONi-3 interim data not reported; success probability downgraded

Overview

This report provides commentary on the incident where interim data from the HARMONi-3 clinical trial of ivonescimab, involving Canfang Bio (9926.HK) and its overseas partner Summit Therapeutics, were not reported. Nomura Securities views this unexpected development as a negative signal for the highly anticipated clinical outcomes, reducing the probability of trial success and thereby pressuring Canfang Bio’s stock price. Although the rating and target price remain unchanged, the firm advises investors to reassess the risks associated with this key catalyst.

Core views

The core issue is that the interim PFS analysis for HARMONi-3 (squamous cell carcinoma cohort) was not reported as the market had expected. In an SEC filing, Summit Therapeutics disclosed that the Independent Data Monitoring Committee (iDMC) advised continuing the study, noting that achieving statistical significance would require a higher threshold than originally planned for the final analysis. This news caused Summit’s stock price to plunge 25% in a single day. Nomura Securities points out that the PFS data from HARMONi-3 and the OS data from HARMONi-6 are the two major clinical events for Canfang Bio in the first half of 2026. The stock’s year-to-date 20% gain largely reflected market expectations for these two sets of data. The failure of the interim data to deliver has led the firm to believe that the probability of ultimate trial success has diminished. However, Summit still maintains its timeline for conducting the final PFS analysis in the second half of 2026. Based on this, Nomura maintains a ‘neutral’ rating and a target price of HKD 142.75 for Canfang Bio. This target price is derived from a DCF model, assuming a weighted average cost of capital (WACC) of 10.8% and a terminal growth rate of 4%. The current stock price corresponds to a price-to-sales ratio of 5.0x based on the 2035 projected sales of RMB 22.4 billion.

Analysis framework

Nomura Securities primarily employs a combination of event-driven analysis and valuation modeling. First, by interpreting regulatory filings (Form 10-Q) from partner Summit Therapeutics, the firm captures subtle shifts in the interim analysis of the clinical trial (the iDMC’s recommendation to continue rather than terminate early or declare success), thereby inferring increased uncertainty regarding the clinical outcome. Second, by examining market sentiment and stock performance (Summit’s sharp decline, Canfang’s year-to-date gains), the firm assesses the impact of this event on expectation gaps. Finally, using a discounted cash flow (DCF) model to determine intrinsic value, the firm incorporates assumptions about future sales ramp-up and clinical success rates into its valuation as justification for maintaining the target price.

Methodology notes

• Valuation MethodDCF Discounted Cash Flow

  DCF Discounted Cash Flow Model

  Intrinsic company value is assessed by discounting the company’s expected future free cash flows back to present value at a specified discount rate (WACC). The report sets WACC at 10.8% and a terminal growth rate of 4%, yielding a target price of HKD 142.75.

• Event Dynamics and Behavioral FinanceExpectation Gap/Expectation Management

  Clinical Data Expectation Gap Analysis

  Focuses on the discrepancy between highly anticipated events (such as interim data reporting) and actual outcomes (no report/recommendation to continue). This gap directly revises market expectations for drug success, often triggering sharp stock price movements.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• Canfang Bio (9926.HK)

  Primary subject, licensor of ivonescimab, directly affected by clinical data expectations

  Strengths

  Owns the potential blockbuster drug ivonescimab; earlier stock price already reflects some positive anticipation

  Weaknesses

  Failure of interim data reporting suggests reduced success probability; lacks other strong near-term catalysts

  Risks

  ivonescimab PFS data weaker than expected; sales ramp-up slower than anticipated; new drug development failure

• Summit Therapeutics (SMMT.US)

  Overseas partner responsible for ivonescimab’s overseas development, directly disclosed the data anomaly

  Weaknesses

  Stock price plunged 25% in one day, indicating extremely negative market interpretation of the data

  Risks

  Final clinical trial failure; regulatory approval hurdles

Key data

• Target PriceHKD 142.75Based on DCF model, WACC 10.8%, terminal growth rate 4%
• Current Stock PriceHKD 135.80Closing price as of April 30, 2026
• Potential Upside5%Calculated based on the difference between target price and current price
• 2035F Projected SalesRMB 22.4 billionOne of the valuation benchmarks
• Valuation Multiple5.0x P/SPrice-to-sales ratio relative to 2035 projected sales
• Summit Stock Movement-25%Decline on April 30 due to interim data not being reported

Impact & implications

For Canfang Bio, sentiment is under short-term pressure, and the gains accumulated on expectations of positive data may face a pullback. Long term, although the final analysis remains scheduled for the second half of 2026, the silence surrounding the interim data increases uncertainty about the outcome, and investors should be wary of the possibility that the final data may fall short of expectations. For the industry, this also serves as a reminder to pay attention to the statistical significance challenges faced by bispecific antibodies in large Phase III trials.

Risks

• ivonescimab PFS data ultimately reported as weaker than expected
• Company product sales ramp up slower than anticipated
• New drug development process fails or is delayed

What to watch

• Final HARMONi-3 PFS analysis results in the second half of 2026
• HARMONi-6 overall survival (OS) data presentation at the ASCO conference
• Whether any new molecular entities are licensed out in the future