LakeShore Biopharma Co., Ltd

For the first nine months of fiscal 2024, revenue was RMB 438.1 million, down 24.6% from RMB 581.2 million in the comparable period of fiscal 2023. Gross profit was RMB 351.7 million versus RMB 449.0 million a year earlier, and gross margin was 80.3%, up 3 percentage points year over year. Net loss was RMB 252.3 million, compared with RMB 64.2 million in the prior-year period; the CEO also cited a net loss of RMB 260 million. Cash and cash equivalents were RMB 222.6 million as of December 31, 2023, versus RMB 370.4 million as of March 31, 2023. Management said the revenue decline was mainly due to COVID-related manufacturing and production disruptions affecting batch approvals and doses available for sale, partly offset by a price increase of about RMB 3.0 per dose for YSJA rabies vaccine. Looking ahead, the company expects product revenue in fiscal 2025, starting April 1, 2024, to increase at a double-digit rate year over year; management also said product sales during the three months ended March 31, 2024, are estimated to have grown double digits year over year.

David Shao said the company spent much of the period fixing lingering production and inventory issues, but emphasized that manufacturing has now returned to normal and inventory is improving. He framed the call around a broader reset: board and management changes, stronger internal controls, streamlined reporting, and tighter cost discipline across manufacturing, sales, marketing, and G&A. He was upbeat on the core rabies franchise and said the PIKA rabies program could support the company’s long-term leadership in China, while also stressing that the pipeline is being reprioritized around higher-potential programs.

Brenda Wu reiterated that the first-nine-month revenue decline to RMB 438.1 million was driven by manufacturing disruptions and lower dose availability, with some offset from a roughly RMB 3.0 per dose price increase. She reported gross profit of RMB 351.7 million and gross margin of 80.3%, up 3 percentage points year over year, while selling and marketing expense rose to RMB 229.2 million, G&A increased to RMB 142.8 million, and R&D rose to RMB 244.7 million due to clinical and testing costs. She also highlighted cash and cash equivalents of RMB 222.6 million and said the company is taking further measures to prudently manage spending and improve the bottom line by the end of fiscal 2025.

The main analyst question focused on the timeline to registration and commercialization of PIKA rabies vaccine after the positive Phase III readout. Management said the final interim report is expected next week, the study will complete around the end of December, final study reports should follow after study closure in Q1 next year, and marketing authorization could take about one to two years depending on the country; they also said conditional approval may be pursued where feasible. On other pipeline assets, management said the chronic hepatitis B Phase 1 study is planned to start in May or June in the Philippines and noted that the local setup allows direct testing in chronic HBV patients rather than healthy volunteers, which they view as potentially more informative.