Morgan Stanley has released a research note stating that management at WUXI XDC (02268) reaffirmed its full-year revenue growth target of 40% on a constant currency basis, which includes contributions from BioDlink.

The investment bank maintains an "Overweight" rating on the company with a target price of HK$85.

Morgan Stanley highlighted that WUXI XDC disclosed a licensing agreement with Ona Therapeutics regarding its WuXiTecan-2 Payload-Linker platform, aimed at developing ADC drugs targeting undisclosed antigens. The bank expects this transaction to further expand WUXI XDC's backlog of milestone-based orders.

As of the first half of this year, total backlog, standalone backlog, and service backlog excluding milestones reached US$2.2 billion, US$2.1 billion, and US$2.0 billion respectively, representing year-on-year increases of 62.2%, 57.9%, and 50.4%.

The bank believes that the U.S. Food and Drug Administration's on-site inspection of the Wuxi facility is expected to take place as early as January or February 2027. If successfully passed, it would be pivotal in establishing a regulatory track record and securing more commercial orders from multinational pharmaceutical companies.