In-Depth Analysis of the Market Competition Landscape for Zepze Pharmaceuticals' Donafenib

Based on the collected information, I will conduct a systematic and comprehensive analysis for you.

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Donafenib is a

independently developed by Zepze Pharmaceuticals. As a deuterated derivative of sorafenib, it exerts anti-tumor effects through dual inhibition and multi-target blockade. The drug was approved by the NMPA in 2021 for first-line treatment of unresectable hepatocellular carcinoma in patients who have not received systemic therapy previously, and was later approved for radioactive iodine-refractory differentiated thyroid cancer [1].

Time Period	Sales Revenue	Year-on-Year Growth	Remarks
2022	Rapid volume growth after medical insurance access	-	First inclusion in medical insurance
2023	RMB 426 million	130%+	First year of volume growth driven by medical insurance
H1 2024	RMB 252 million	-	Sustained growth trend
Full Year 2024	RMB 533 million	37.91%	Covers over 1,100 hospitals

According to Zepze Pharmaceuticals’ 2024 annual report, the company achieved operating revenue of RMB 533 million, a year-on-year increase of 37.91% compared to the previous year, mainly due to the steady progress of commercial promotion of Donafenib tablets and the further expansion of hospital coverage for drug access [2].

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Liver cancer treatment has fully transitioned from the

to the , and this transformation poses significant competitive pressure on Donafenib. The main combination therapies and their efficacy data are as follows:

Combination Regimen	Company	Median Overall Survival (mOS)	Sorafenib (Control Group)
“Double Ai Combo” (Camrelizumab + Apatinib)	Hengrui Medicine	22.1 months	15.2 months
“T+A Regimen” (Atezolizumab + Bevacizumab)	Roche	19.2 months	13.4 months
Durvalumab + Tremelimumab	AstraZeneca	16.4 months	13.8 months

Hengrui Medicine’s “Double Ai Combo” demonstrates the most significant survival advantage, with an mOS of 22.1 months, which is significantly better than the clinical trial data of Donafenib [1].

Since the first PD-(L)1 inhibitor was launched in China in 2018, the market size has grown from RMB 5.7 billion in 2019 to

in 2023. The main competitive landscape of PD-(L)1 inhibitors in the liver cancer field is as follows:

Ranking	Drug	Company	2023 Sales Revenue	Market Share
1	Tislelizumab	BeiGene	RMB 4.5 billion	24.75%
2	Sintilimab	Innovent Biologics	RMB 4 billion	22%
3	Pembrolizumab	Merck & Co.	RMB 3.2 billion	17%

BeiGene’s Tislelizumab ranks first with sales revenue of RMB 4.5 billion [1].

As a direct competitor of Donafenib, Lenvatinib’s market performance also reflects the competitive pressure faced by targeted drugs:

• First included in medical insurance in 2020, with sales revenue of RMB 1.656 billion in 2021
• Reached a peak of nearly
  RMB 2.8 billion
  in 2022
• Showed a
  downward trend
  from 2023 to 2024 due to intensified competition [1]

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Despite the impact of PD-1 combination therapies, Donafenib still has the following differentiated advantages:

As a deuterated derivative of sorafenib, Donafenib demonstrated in clinical trials, which is its core differentiated selling point [1].

As an innovative drug included in medical insurance, Donafenib has a cost advantage in pricing compared to imported PD-1 combination therapies, which aligns with the policy direction of medical insurance cost control.

In the field of first-line liver cancer treatment, Donafenib is among the first domestically developed innovative targeted drugs approved in China, and has established a certain hospital coverage network (as of the end of 2024, it has covered , , and nearly ) [2].

Compared to the 22.1-month mOS of the “Double Ai Combo”, Donafenib showed similar progression-free survival (PFS) data to sorafenib in head-to-head clinical trials, with no obvious efficacy advantage.

PD-(L)1 combination regimens have been listed as in the CSCO Guidelines. Targeted-immunotherapy combination therapies have become the mainstream, weakening the therapeutic status of single-agent targeted drugs.

As patents for drugs such as Lenvatinib expire, generic drugs have significantly impacted the market share of original drugs, and Donafenib also faces potential competitive pressure from generic drugs.

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Zepze Pharmaceuticals has launched 3 key drugs to diversify risks from single products:

• Donafenib Tosylate Tablets
  (liver cancer, thyroid cancer)
• Recombinant Human Thrombin
  (hemostasis field, included in medical insurance at the end of 2024)
• Gicartinib Hydrochloride Tablets
  (hematological malignancies)

Donafenib has

to seek breakthroughs in overseas markets [1].

The company’s R&D pipeline includes recombinant human thyroid-stimulating hormone for injection, ZG005 for injection, ZG006, etc., with multiple drugs in different clinical stages [2].

The company has established a core operation team with rich experience in clinical launch and promotion, and continues to advance the market expansion of Donafenib [2].

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Donafenib will still occupy a certain share in the liver cancer targeted drug market, with the following forecasts:

• Annual sales range
  : RMB 600 million to RMB 800 million (conservative) to RMB 800 million to RMB 1 billion (optimistic)
• Growth drivers
  : Continuous expansion of hospital coverage, sustained volume growth driven by medical insurance, differentiated positioning

The market space will depend on:

• Progress of combination therapies
  : Development progress of Donafenib + PD-1 combination regimens
• Evolution of competitive landscape
  : Timing of generic drug entry, competition from other new drugs
• Medical insurance renewal status
  : Ability to maintain prices in medical insurance negotiations

If combination therapy regimens are successfully developed and internationalization is achieved, Donafenib’s

; if only relying on a single-agent strategy, its market share may be gradually eroded by combination therapies.

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Risk Type	Specific Content
Risk of intensified competition	Continuous penetration of PD-1 combination therapies crowding out the market space of single-agent drugs
Risk of medical insurance price reduction	Medical insurance negotiations may bring further price reduction pressure
Risk of generic drugs	Entry of generic drugs may trigger price wars
R&D risk	Uncertainties may exist in the development of combination therapies
Commercialization risk	Sales and promotion effects may fail to meet expectations

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[1] Analysis of Liver Cancer Drug Market Pattern and Trends, CN-Healthcare (https://www.cn-healthcare.com/articlewm/20251010/content-1658757.html)

[2] 2024 Annual Report of Suzhou Zejing Biopharma Co., Ltd., Zepze Pharmaceuticals (http://notice.10jqka.com.cn/api/pdf/97050b923c2a25a1.pdf)

[3] Medical Insurance Application Materials for Atezolizumab Injection (Tecentriq®), National Healthcare Security Administration (https://www.nhsa.gov.cn/attach/Ypsnsp2025/YPSW202500389/YPSW202500389(ppt).pdf)

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: Donafenib’s market space is indeed significantly impacted by PD-1 combination therapies, but relying on its safety advantages and established commercial channels, the product is expected to maintain an annual sales scale of RMB 600 million to RMB 1 billion in the next 2-3 years. Zepze Pharmaceuticals needs to accelerate the development of combination therapies, achieve product portfolio diversification and international layout to maintain long-term competitiveness in an environment of intensified competition. Investors should focus on the company’s R&D progress of combination therapies and the commercial performance of new products.