ASCO2026 Day2: Differentiation in RAS Targets and Acceleration in ADC Innovation, Chinese Biotech Sees Structural Opportunities

Overview

This research report is Morgan Stanley's key takeaways from the core content of Day 2 of the 2026 American Society of Clinical Oncology (ASCO) annual meeting, focusing on the implications of global advances in oncology treatment for Chinese biotechnology companies. The report does not target a single company but instead analyzes two main technological avenues—RAS-targeted drugs (particularly KRAS G12C) and antibody-drug conjugates (ADCs)—examining their clinical evidence, mechanism differences, toxicity trade-offs, and commercialization logic in first-line treatment, while clearly pointing out the potential paths for related Chinese companies to benefit.

Core views

The core views of the report revolve around two technological directions: In RAS-targeted therapy, KRAS G12C monotherapy is viewed as a 'cleaner' first-line treatment strategy, with clinical data from Divarasib and Elisrasib supporting their mono and combination potential. However, it emphasizes 'not all G12C inhibitors are the same,' noting significant differences in pharmacokinetic properties, central nervous system penetration, hepatotoxicity, and ON/OFF switching mechanisms among molecules, with some OFF-type drugs demonstrating durable monotherapy efficacy. Non-G12C and pan-RAS targets remain in the early exploratory stage, with current pathways heavily reliant on chemotherapy, while MAPK pathway partners, lineage plasticity, and skin/GI toxicity impact on quality of life constitute key constraints for first-line application. The ADC field shows a clear 'forward-shift' trend, with the report advocating their first-line use in urothelial carcinoma (UC), triple-negative breast cancer (TNBC), and HER2-positive breast cancer (HER2+ BC). The core concerns are around the balance of tolerance in combination use and sequential dosing. Next-generation innovations focus on dual-payload and bispecific ADCs, particularly those going beyond traditional topoisomerase/tubulin payloads, while linker stability, biomarker dependency, and cross-resistance issues become key watchpoints.

Analysis framework

This report adopts a typical three-tier analytical framework: 'international frontier meetings → clinical science logic → Chinese industry mapping.' Firstly, it extracts core scientific topics from ASCO Day 2 (RAS/ADC treatment regimen design in first-line, dosing intensity, efficacy/toxicity trade-offs). Then, it delves into the biological mechanism differences behind different technological pathways (e.g., G12C ON/OFF mechanisms, ADC payload and linker engineering) and their real-world impact on clinical practice. Finally, it centers on the capability map of Chinese companies, tying their layout in target discovery (RAS), platform technologies (ADC formats/payloads/linkers), and combination logic design to precise mapping and comparisons of candidates, rather than generalizing industry trends.

Methodology notes

• industry/industrial analysis frameworksupply and demand framework

  While the report does not directly discuss capacity or supply, it implicitly follows the logic where 'upgraded clinical demand' (shifting to earlier treatment lines) drives technological iteration and company revaluation—that is, new indication expansions lead to incremental market space.

  When certain therapies (such as ADCs) are recommended for earlier treatment lines at authoritative conferences, it means their clinical value is redefined, thereby expanding the potential patient pool and willingness to pay. This is a crucial industrial logic for judging companies' long-term growth.

• industry/industrial analysis frameworkcompetition and strategy framework

  moat/competitive advantage

  The report repeatedly emphasizes that 'not all G12C inhibitors are the same' and that 'differences at the molecular level are huge,' precisely to indicate: in homogeneous target competitions, the real moat lies in the underlying molecular design capabilities (PK/PD, selectivity, toxicity profile), not merely in possessing the target itself.

• industry/industrial analysis frameworktransmission across industrial chain's upper, middle, and lower streams

  the transmission chain from international clinical data (upstream) → Chinese biotech R&D pipelines and platform capabilities (midstream) → commercialization implementation and patient benefit (downstream)

  Clinical data released at ASCO are the 'navigational markers' for global pharmaceutical R&D; their findings directly affect capital's valuation logic for midstream R&D companies and ultimately determine whether downstream patients can access superior treatment options.

Asset mapping & comparison

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

• Abbisko

  representative company in RAS targets, with KRAS G12C inhibitor pipeline, directly benefiting from the strengthening of first-line monotherapy logic for this target

  Strengths

  early layout in the KRAS G12C field, clinical data are expected to verify molecular differentiation advantages

  Comparison

  together with Genfleet and Jacobio, part of the first tier in China's RAS field. Competition focus centers on the speed and quality of clinical data readout

  Risks

  clinical trial progress below expectations, delays in overseas regulatory approvals

• Genfleet

  representative company in RAS targets, with KRAS G12C inhibitor pipeline, directly benefiting from the strengthening of first-line monotherapy logic for this target

  Comparison

  together with Abbisko and Jacobio, part of the first tier in China's RAS field. Competition focus centers on the speed and quality of clinical data readout

  Risks

  clinical trial progress below expectations, delays in overseas regulatory approvals

• Jacobio

  representative company in RAS targets, with KRAS G12C inhibitor pipeline, directly benefiting from the strengthening of first-line monotherapy logic for this target

  Comparison

  together with Abbisko and Genfleet, part of the first tier in China's RAS field. Competition focus centers on the speed and quality of clinical data readout

  Risks

  clinical trial progress below expectations, delays in overseas regulatory approvals

• Duality Biotherapeutics

  representative company in ADC platforms, favored in the report for format depth, payload/linker technology, and combination logic

  Strengths

  leading layout in next-generation technology directions such as bispecific/dual-payload ADCs

  Comparison

  compared to diversified biotechs like Innovent and Akeso, Duality focuses more on ADC platform innovation, with potentially more profound technological depth

  Risks

  long clinical validation cycle and high technological complexity for next-generation ADCs create uncertainty

• Innovent Biologics

  representative company in ADC platforms, favored in the report for format depth, payload/linker technology, and combination logic

  Strengths

  strong clinical development and commercialization capabilities with a rich ADC pipeline

  Comparison

  compared to Duality, Innovent's strength lies in full-chain execution capabilities; compared to Akeso, it has a wider international cooperation network

  Risks

  increasing ADC pipeline competition, pressure from medical insurance negotiations

• Akeso

  representative company in ADC platforms, favored in the report for format depth, payload/linker technology, and combination logic

  Strengths

  unique platforms such as internally developed PD-1/CTLA-4 bispecifics can empower ADC combination strategies

  Comparison

  compared to Innovent, Akeso has unique advantages in bispecific platforms; compared to Duality, it may be somewhat less specialized in ADC precision

  Risks

  commercialization of core products below expectations, persistently high R&D expenses

• Nanjing Leads Biolabs (Leads Bio)

  representative company in ADC platforms, favored in the report for format depth, payload/linker technology, and combination logic

  Strengths

  solid foundation in ADC linker-payload chemistry and process development

  Comparison

  as a technical CDMO/CXO extendable company, Leads Bio has distinctive capabilities in platform technology output compared to pure biotechs

  Risks

  customer concentration risk, fluctuations in industry capital expenditure cycles

Key data

• Industry Perspective RatingAttractiveMorgan Stanley analysts assign an 'Attractive' rating to the covered Chinese biotechnology industry's performance over the next 12-18 months, outperforming relevant benchmark indices.

Impact & implications

This report suggests that the valuation of Chinese biotech companies is accelerating from 'target presence or absence' to 'molecular superiority' and 'platform depth.' In the RAS field, companies with independent KRAS G12C inhibitor pipelines (e.g., Abbisko, Genfleet, Jacobio) will see clinical progression pace and differentiated data become key catalysts. In the ADC field, companies with unique payload technologies, stable linker chemistry, and mature combo logics (e.g., Duality, Innovent, Akeso, Leads Bio) will gain first-mover advantages in the wave of first-line treatment. Overall, the 'hard barriers' of technological innovation offer more long-term certainty than merely follow-on development.

Risks

• Clinical data differentiation between KRAS G12C inhibitors may lead to revaluation of some company pipelines
• Promotion of ADC in first-line application is constrained by toxicity management (especially skin/GI QoL impact) and biomarker-guided precision therapy capability
• Non-G12C pan-RAS targets lack breakthrough clinical data, posing R&D failure risks for related pipelines

What to watch

• Key clinical data readout for Divarasib and Elisrasib in first-line treatment of KRAS G12C NSCLC
• First proof-of-concept (POC) clinical results for dual-payload/bispecific ADCs
• Reporting pace and data quality disclosed by Chinese RAS and ADC companies at international conferences such as ASCO