The "male enhancement" rumors caused the stock price to surge and then fall back. How solid is the behind-the-scenes approval of Changchun High-tech's research soft ointment clinical trial?

A clinical approval adds to market “imagination,” quickly igniting investor sentiment.

On the evening of February 24, Changchun High-tech (000661.SZ) announced that its subsidiary, Jinsai Pharmaceutical’s GenSci141 ointment, received approval to conduct clinical trials for “children’s micropenis.” Meanwhile, market rumors that the ointment has “adult aphrodisiac effects” quickly gained traction. On the afternoon of the 25th, the company’s stock hit the daily limit up, and on the 26th, it surged early but then pulled back.

Sources from Caixin learned that the product is currently only in the early stages of clinical trials, with significant uncertainty regarding its indications and commercialization prospects. There may be a clear disconnect between market expectations and reality.

Clinical approval sparks excitement, with divergent investor reactions after two days of rally

According to the announcement, GenSci141 ointment is a dihydrotestosterone (DHT) cream developed by Jinsai Pharmaceutical. It mainly acts through paracrine effects within target tissues and is classified as a chemical drug in categories 2.2 and 2.4, representing an improved new drug. Its approved indications include treatment of congenital hypogonadotropic hypogonadism, 5α-reductase 2 deficiency, congenital adrenal hyperplasia with reduced androgen synthesis, and idiopathic micropenis in children.

Notably, no drug specifically targeting children’s micropenis has been approved globally to date. Therefore, the clinical approval of this ointment has attracted significant market attention and is seen as an important addition to Changchun High-tech’s pediatric health portfolio.

Public information indicates that the primary treatment goal for children’s micropenis is to achieve a normal minimum penile length and enable standing urination, laying the foundation for normal adult sexual activity. Current clinical treatments mainly include medication, surgery, and psychological counseling. Among these, exogenous androgens are the main pharmacological approach. Dihydrotestosterone (DHT) has higher affinity for androgen receptors than regular testosterone, promoting penile tissue growth without accelerating bone maturation or causing male gynecomastia, thus avoiding adverse effects associated with high-dose testosterone.

From a product perspective, GenSci141 falls within the pediatric endocrinology niche, continuing Jinsai Pharmaceutical’s strategic focus on growth and development. Market consensus suggests that this product could open new therapeutic scenarios beyond growth hormone treatments.

Stimulated by this positive news, on February 25, the company’s stock hit the daily limit in the afternoon, reflecting high investor sensitivity to the “new pipeline + new indications” combination. Today, Changchun High-tech’s stock continued its strong performance, opening at 102.00 yuan per share, quickly rising over 8% during the session before pulling back.

Regarding stock price fluctuations, a staff member from Changchun High-tech’s securities department told Caixin that “the stock price is not manipulated by the company; we hope investors remain rational.”

In recent years, Changchun High-tech has increased R&D investment, with 2024 R&D spending reaching 2.69 billion yuan, accounting for 19.97% of revenue. To date, the company has over 40 candidates in clinical stages or with submitted IND applications, including 14 in Phase III or NDA review, and 15 innovative drugs in Class 1.

Is the “adult aphrodisiac” claim true? Market approval may take at least three years

Regarding the circulating rumors that the ointment has “adult aphrodisiac effects,” Caixin contacted Changchun High-tech’s securities department this morning as an investor to inquire about the authenticity of the rumors, development timeline, future revenue contribution, and potential expansion of indications.

When asked whether GenSci141 ointment has aphrodisiac effects, the company staff clearly stated, “Please refer to the official announcement. Our current product is only approved for clinical trials, and we must strictly follow the approved indications for testing. It will still take quite some time from clinical trials to market.”

When further asked whether the aphrodisiac claim is false, the response was only, “Please refer to the official announcement.”

Regarding the timeline from clinical approval to market launch, the securities department said, “There haven’t been any setbacks; everything has gone smoothly. Under particularly favorable conditions, it would take at least three years.” Generally, developing a new drug from clinical trials to market takes about seven to eight years. Since this is a Class 2.2 improved drug, it is somewhat faster than a new chemical entity, but the difference isn’t large.

Improved drugs typically have lower R&D risk, shorter development cycles, and higher returns. Compared to innovative drugs, they have more defined targets and mechanisms, and can leverage existing research data on known active ingredients, shortening clinical development time.

However, the securities department emphasized that even as an improved drug, GenSci141 still requires strict clinical procedures, and its development timeline remains uncertain.

When asked about the potential revenue contribution after approval, the staff said, “We currently have no estimates, as the company’s pipeline is quite full. This is just one of many projects. Once approved, we will proceed with clinical trials based on the actual situation.”

The reporter also asked whether the company plans to expand indications related to “aphrodisiac” effects, and the securities department clarified that the company will continue focusing on core areas—“children, women’s health, and oncology.” They added, “We haven’t decided on other indications yet; it depends on clinical results.”

She further explained, “This is common in drug development. For example, with our previous candidates 098 and 074, we discovered during trials that they could be applicable to other diseases, which then prompted further clinical applications. It depends on the specific situation; we analyze case by case, and can’t generalize.”

(Source: Caixin)