Q1 2025 Zai Lab Ltd Earnings Call

May 8, 2025

Thank you for your time, and I'll see you in the next video.

Christine Chiou: Hello, ladies and gentlemen. Thank you for standing by, and welcome to Zai Lab's Q1 2025 Financial Results Conference Call. At this time, all participants are in listen-only mode. Later, we will conduct a question and answer session, and instructions will follow at that time. As a reminder, today's call is being recorded. It is now my pleasure to turn the floor over to Christine Chiou, Senior Vice President of Investor Relations. Please go ahead.

Speaker Change: Hello, ladies and gentlemen. Thank you for standing by and welcome to Zai Lab's first quarter to a 2020 five financial results conference call. At this time, all participants are in listen only mode. Later, we will conduct a question and answer session and instructions will follow at that time.

Speaker Change: As a reminder, today's call has been recorded. It is now my pleasure to turn the floor over to Christine Chiou, Senior Vice President of Investor Relations. Please go ahead.

Christine Chiou: Thank you, operator. Hello, and welcome, everyone. Today's earnings call will be led by Dr. Samantha Du, Zai Lab's Founder, CEO, and Chairperson. She will be joined by Josh Smiley, President and Chief Operating Officer, Dr. Rafael G. Amado, President and Head of Global Research and Development, and Dr. Yajing Chen, Chief Financial Officer. Jonathan Wang, our Chief Business Officer, will also be available to answer questions during the Q&A portion of the call. As a reminder, during today's call, we will be making certain forward-looking statements based on our current expectations. These statements are subject to numerous risks and uncertainties that may cause actual results to differ materially from what we expect due to a variety of factors, including those discussed in our SEC filings. We will also refer to adjusted loss from operations, which is a non-GAAP financial measure.

Christine Chiou: Thank you, operator. Hello and welcome, everyone. Today's earnings call will be led by Dr. Samantha Du, Zai Lab founder, CEO and Chairperson. She will be joined by Josh Smiley, President and Chief Operating Officer, Dr. Rafael Amado, President and Head of Global Research and Development, and Dr. Yajing Chen, Chief Financial Officer.

Speaker Change: Jonathan Wang, our Chief Business Officer, will also be available to answer questions during the Q&A portion of the call.

Speaker Change: As a reminder, during today's call, we will be making certain foreign-looking statements based on our current expectations. These statements are subject to numerous risks and uncertainties that may cause actual results to differ materially from what we expect due to a variety of factors, including those discussed in our SEC filing.

Speaker Change: We will also refer to adjusted loss of operations, which is a non-GAAP financial measure. Please refer to our earnings release for Missed The SEC on May 25 for additional information on this non-GAAP financial measure. At this time, it is my pleasure to turn the call over to Dr. Samantha Du.

Christine Chiou: Please refer to our earnings release furnished with the SEC on 8 May 2025 for additional information on this non-GAAP financial measure. At this time, it is my pleasure to turn the call over to Dr. Samantha Du.

Samantha Du: Thanks, Christine Chiou. Good morning and good evening, everyone. Thank you for joining us today. We entered 2025 with a conviction that this would be a pivotal year for Zai Lab. A year where strong execution, disciplined growth, and a scientific innovation would begin to reshape our long-term trajectory. Let me be clear. Our conviction, the strength of our business fundamentals and strategic direction remains strong. As we close out Q1, we're reaffirming our full year revenue guidance of between $560 million to $590 million. We anticipate accelerating sales growth in the next 3 quarters, which will translate into significant operating leverage and keep us on track to achieve profitability by Q4 of this year. Before I turn the call over to Josh Smiley to discuss our Q1 performance, I want to share my excitement for the road ahead.

Speaker Change: Thanks Christine. Good morning and good evening everyone. Thank you for joining us today.

Speaker Change: were entered 20-25 with a conviction that this would be a pivotal year for Zai Lab.

Speaker Change: Earlier, were a strong execution, disciplined growth, and a scientific innovation, would begin to reasshape our long-term trajectory.

Speaker Change: Let me be clear, our conviction, the strength of our business fundamentals and strategic direction remains strong.

Speaker Change: As we close out the first quarter, we're reaffirming our full-year revenue guidance of $3.60 million to $5.90 million.

Speaker Change: We anticipate accelerating sales goals in the next three quarters, which will translate into a significant operating leverage and keep us on track to achieve with profitability at Q4 this year.

Speaker Change: Before I turn the cover to Josh to discuss our Q1 performance, I want to share my excitement for the road ahead.

Samantha Du: Celliche has a differentiated and highest potential portfolio, including multiple regional first-of-best-in-class assets that are poised to deliver significant long-term value. This includes pipeline product opportunities like VYVGART and povetacicept, as well as other potential blockbusters like bemarituzumab in gastric cancer, KarXT schizophrenia, and TTFields in pancreatic cancer. We are confident in delivering our 2025 revenue targets and surpassing $2 billion by 2028, with strong momentum carrying well into the 2030s. Our regional business is already commercially profitable with a clear growth runway, and we will continue to add new assets with discipline and focus. At the same time, we've made bold investments to celebrate our global R&D pipeline. Our lead global asset, ZL-1310, is a potential first-in-best-in-class DLL3 ADC.

Their life has a differentiated and highest potential portfolio.

Speaker Change: including multiple original first or best-in-class assets that are poised, deliver significant long-term value. This includes pathfinder product opportunities that leave guards and poverty deficits.

Speaker Change: As well as other potential blockbusters like B. Matiu Sumat in Get Your Concert, Halsey Gizofrinia and Titi Field in Tanguetic Concert.

Speaker Change: We are confident in delivering our 2025 revenue targets and third-party in 2 billion dollars by 2028, with strong momentum carrying wall into the 2030.

Speaker Change: Our original testimony is already commercially profitable with a clear growth runway.

Speaker Change: and will continue to add new assets with distinct and focus.

Speaker Change: At the same time, we have made bold investments to celebrate our global R&D pipeline.

Speaker Change: Our lead globalizer, G.O. 1310, is a potential first in Dising Cards, D.O. 3 Edition.

Samantha Du: We'll present updated phase 1 data in small cell lung cancer at ASCO in June and outline our broader development strategy across multiple indications, including a registrational trial that positions us for a potential FDA approval in 2027. A milestone that would elevate our position on the global stage. Beyond ZL-1310, we're advancing our next wave of innovation. ZL-6201, our novel LRRC15 ADC for solid tumors, and ZL-1503, a first-in-class IL-13/IL-31 bispecific for atopic dermatitis, are both expected to enter the clinics this year, further expanding our global oncology immunology pipeline. Looking ahead, we see clear drivers of margin expansion, increased scale with VYVGART, efficient new launches that leverage our existing infrastructure, manufacturing localization, and the ramp up of high-value global assets. These efforts are building Celliche into a profitable, high-growth business with global impact.

Speaker Change: will present updated phase 1 data in small cell lung cancer at SCO in June and outline our broader development strategy across multiple indications.

Speaker Change: including a registration of trial that positions us boy potential at the approval in 2037.

Speaker Change: A milestone that would elevate our position on the global stage.

The young 13-ton, with Van Ting Arbor's next wave of innovation.

GL-60201 of a novel LRC-15 ADC for Sally Trumers, [inaudible]

Speaker Change: On GL 1503, his first in class, our 13, our 31-bed specific, for a topic dermatitis, a bulwark circuit, to enter the clinics this year.

for expanding our global oncology immunology pipeline.

Looking ahead, we see clear drivers of margin expansion.

Speaker Change: Increased scale with regard, efficient new launches that leverage our existing infrastructure, manufacturing localization, and the ramp up of high value global assets.

Speaker Change: This efforts a business life into a profitable, high-growth business with global impact.

Samantha Du: We're just getting started, and I look forward to updating you on our progress throughout the year. Now I turn the call over to Josh. Josh?

Speaker Change: We're just getting started and I look forward to updating you on our progress throughout the year.

Josh Smiley: Thank you, Samantha, and good morning and good evening to everyone. Let's start with VYVGART. Following exceptional 2024, we expect another strong year in 2025, with VYVGART sales growth expected to outpace total revenue growth, driven by increased patient demand, improved treatment continuity, and expanded access. Q1 sales reflected seasonal trends, with Chinese New Year driving a temporary decline in patients in January and February. As an IV treatment for a chronic disease, VYVGART is more susceptible to this type of seasonality. That said, patient volumes rebounded in March and April, and we anticipate a return to strong sequential growth throughout the rest of the year. Inventory dynamics also influenced quarterly sales growth. In preparation for the launch of VYVGART Hytrulo, we had some inventory build in Q4. The timing of these movements had a notable impact on reported sales growth.

Speaker Change: Now a time of cold for the Josh. Josh. Thank you Samantha and good morning and good evening to everyone. Let's start with Viv Gart.

Josh Smiley: Following exceptional 2020-24, we expect another strong year in 2025, with Vivgart sales growth expected to outpace total revenue growth, driven by increased patient demand, improved treatment continuity and expanded access.

Josh Smiley: First quarter sales reflected seasonal trends with Chinese New Year driving a temporary decline in patients in January and February .

Josh Smiley: As an IV treatment for a chronic disease, Vivgarg is more susceptible to this type of seasonality. That said, patient volumes rebounded in March and April and we anticipate a return to strong sequential growth throughout the rest of the year.

Josh Smiley: Inventory Dynamics also influenced quarterly sales growth. In preparation for the launch of Viv Gart-Hituloh, we had some inventory build in Q4. The timing of these movements had a notable impact on reported sales growth.

Josh Smiley: Looking ahead, we are seeing early positive results from our ongoing strategic initiatives to extend treatment duration. In addition, the first expert recommendations for the clinical application of FcRn antagonists in the treatment of gMG were published in February, a similar update to the national gMG treatment guidelines is expected later this year. Together, these developments provide additional momentum for continued sequential growth and an acceleration in the second half of this year. We're also preparing for the upcoming NRDL cycle, targeting IV renewal for gMG and initial listing of the SC formulation, both of which would take effect on 1 January 2026. Let me turn to our broader commercial portfolio. All other products, including ZEJULA and NUZYRA, delivered sequential growth supported by NRDL access. We also saw early contributions from ONTYRO and XACDURO. In particular, XACDURO is showing strong initial demand.

Josh Smiley: Looking ahead, we are seeing early positive results from our ongoing strategic initiatives to extend treatment duration.

Josh Smiley: In addition, the first expert recommendations for the clinical application of FCRN antagonists in the treatment of GMG were published in February , an similar update to the National GMG treatment guidelines that expected later this year.

Josh Smiley: Together, these developments provide additional momentum for continued sequential growth and an acceleration in the second half of this year.

Josh Smiley: We're also preparing for the upcoming NRDL cycle, targeting IV renewal for GMG and initial listing of VSC formulation, both of which would take effect on January 1st, 2026.

Now, let me turn to our broader commercial portfolio.

Josh Smiley: All other products, including Zijula and Uzaira, delivered sequential growth supported by NRDL access.

Josh Smiley: We also saw early contributions from Ontario and Zactoro. In particular, Zactoro was showing strong initial demand. Physician feedback has been highly positive, citing Zactoro's rapid efficacy and favorable safety profile in treating crab infections.

Josh Smiley: Physician feedback has been highly positive, citing XACDURO's rapid efficacy and favorable safety profile in treating CRAB infections, a serious unmet need in China, where an estimated 300,000 Acinetobacter cases occur annually with limited treatment options and poor outcomes. Turning to our financial position, we continue to strengthen efficiency and operating leverage. For Q1 2025, operating loss improved by 20% to $56.3 million, and by 25% to $37.1 million on an adjusted basis, keeping us firmly on track to reach profitability in Q4. Looking ahead, we have a robust set of late-stage opportunities to drive substantial growth. Three regulatory reviews are currently underway, including KarXT for schizophrenia and TIVDAK for cervical cancer.

Josh Smiley: A serious unmet need in China, where an estimated 300,000 ascentivactor cases occur annually with limited treatment options and poor outcomes.

Josh Smiley: Turning to our financial position, we continue to strengthen efficiency and operating leverage. For the first quarter of 2025, operating loss improved by 20% to $56.3 million and by 25% to $37.1 million on an adjusted basis.

Josh Smiley: Keeping us firmly on track to reach profitability in the fourth quarter.

Josh Smiley: Looking ahead, we have a robust set of late-stage opportunities to drive substantial growth.

Josh Smiley: Three regulatory reviews are currently underway, including Karek St. for schizophrenia and Tidak for cervical cancer.

Josh Smiley: We anticipate at least three additional submissions this year, including bemarituzumab for gastric cancer, TTFields for pancreatic cancer, and VYVGART's prefilled syringe for gMG and CIDP. We expect to optimize our commercial footprint by leveraging our existing commercial infrastructure to efficiently support future launches. For example, deploying our ZEJULA team to support TIVDAK and our Qinlock team for bemarituzumab. For targeted opportunities like KarXT, we can effectively reach over 85% of the market with a focus team of approximately 150 sales representatives. In parallel, we are advancing further operational efficiencies as VYVGART scales, and as we localize manufacturing for key products to more cost effectively support our regional portfolio. These efforts are central to our strategy for achieving profitability alongside long-term revenue growth.

Josh Smiley: And we anticipate at least three additional submissions this year, including Ben Murtuzemab for gastric cancer, TT Fields for pancreatic cancer, and Viv Garz pre-filled syringe for GMG and CIDP.

Josh Smiley: We expect to optimize our commercial footprint by leveraging our existing commercial infrastructure to efficiently support future launches.

Josh Smiley: For example, deploying our Zajula team to support TIBDAQ and our kinlock team for Bemritu Zimab. For targeted opportunities like CARXT, we can effectively reach over 85% of the market with a focus team of approximately 150 sales representatives.

Josh Smiley: In parallel, we are advancing further operational efficiencies as Vivgart Scales and as we localize manufacturing for key products to more cost-effectively support our regional portfolio. These efforts are central to our strategy for achieving profitability alongside long-term revenue growth.

Josh Smiley: With a fast-growing greater China business, a deepening global pipeline, and disciplined financial execution, we are well-positioned to deliver substantial value for our shareholders in 2025 and beyond. With that, I'll pass the call over to Rafael to discuss the great progress within our pipeline.

Josh Smiley: With a fast-growing greater China business, a deepening global pipeline and discipline financial execution, we are well positioned to deliver substantial value for our shareholders in 2025 and beyond.

Rafael G. Amado: Thank you, Josh. I'll start by highlighting the key progress updates in our global pipeline since our last earnings call, along with our next steps. Starting with ZL-1310, our potential first and best-in-class DLL3 ADC for small cell lung cancer. Last year, we shared promising preliminary monotherapy results from the Phase 1 dose escalation cohort, demonstrating antitumor responses in the majority of patients with extensive stage small cell lung cancer, including in brain lesions with good tolerability. We completed enrollment in the dose escalation monotherapy cohort. Enrollment in the ongoing monotherapy dose optimization cohort is progressing rapidly, and we look forward to presenting updated data from both cohorts of the global Phase 1 study at the ASCO meeting in June this year.

Rafael Amado: Thank you, Josh. I'll start by highlighting the key progress updates in our global pipeline since our last earnings call, along with our next steps. Starting with ZL-1310, our potential first and best-in-class DLL3 ADC for small cell lung cancer. Last year, we shared promising preliminary monotherapy results from the Phase 1 dose escalation cohort, demonstrating antitumor responses in the majority of patients with extensive stage small cell lung cancer, including in brain lesions with good tolerability. We completed enrollment in the dose escalation monotherapy cohort. Enrollment in the ongoing monotherapy dose optimization cohort is progressing rapidly, and we look forward to presenting updated data from both cohorts of the global Phase 1 study at the ASCO meeting in June this year.

Josh Smiley: And with that, I'll pass the call over to Rafael to discuss the great progress within our pipeline. Thank you, Josh. I'll start by highlighting the key progress updates, you know, global pipelines since our last earnings call, along with our next steps.

Rafael Amado: Starting with VL1310, our potential first and best in class GLO3 ADC for small cell lung cancer.

Rafael Amado: Last year, we share promising preliminary monotherapy results from the state's one dose escalation cohort, demonstrating anti-domar responses in the majority of patients with extensive state-smotor lung cancer, including in brain lesions with good tolerability.

We completed enrollment in the dose escalation monotherapy cohort.

Rafael Amado: Enrollment in the ongoing monotherapy dose optimization cohort is progressing rapidly.

Rafael Amado: We look forward to presenting updated data from both cohorts of the Global Phase I study at the meeting in June this year.

Rafael G. Amado: We're also pleased with ongoing regulatory discussions with the FDA, we are on track to initiate a pivotal study in small cell lung cancer later this year, positioning us for a potential accelerated approval in 2027. We're also assessing potential combinations in the first line setting, we expect to provide data in the second half of this year. As ZL-1310 is also highly expressed in other neuroendocrine tumors, we're exploring its therapeutic potential beyond small cell lung cancer. A global phase 1/2 study was initiated in April to explore ZL-1310 in this indication. Next, on our other global oncology assets. At the American Association for Cancer Research meeting, we presented new data for 2 of our internally developed oncology therapies, ZL-6201 and ZL-1222.

Rafael Amado: We're also pleased with ongoing regulatory discussions with the FDA, we are on track to initiate a pivotal study in small cell lung cancer later this year, positioning us for a potential accelerated approval in 2027. We're also assessing potential combinations in the first line setting, we expect to provide data in the second half of this year. As ZL-1310 is also highly expressed in other neuroendocrine tumors, we're exploring its therapeutic potential beyond small cell lung cancer. A global phase 1/2 study was initiated in April to explore ZL-1310 in this indication. Next, on our other global oncology assets. At the American Association for Cancer Research meeting, we presented new data for 2 of our internally developed oncology therapies, ZL-6201 and ZL-1222.

Rafael Amado: We are also pleased with ongoing regulatory discussions with the FDA, and we are on track to initiate a pivotal study in small-cell lung cancer later this year, positioning us for a potential accelerated approval in 2027.

Rafael Amado: We're also assessing potential combinations in the first line searching and we expect to provide data in the second half of this year. As PLN3 is also highly expressed in other neuroendocrine tumors, we're exploring its therapeutic potential beyond small cell lung cancer.

Rafael Amado: A Global Phase 1-2 study was initiated in April to explore real 13-10 in this indication. Next, on our other global oncology answers. At the American Association for Cancer Research Meeting, we presented new data for two of our internally developed oncology therapies.

Rafael G. Amado: ZL-6201 is a novel ADC with an internally developed high affinity and specificity for LRRC15 antibody and next generation payload linker. LRRC15 is an attractive target for cancer therapy due to its overexpression in multiple solid tumors such as sarcoma, glioblastoma, and melanoma, as well as its expression in fibroblasts in the tumor microenvironment of multiple tumors such as breast, lung, and colorectal cancer. The payload linkage system releases the payload by cleavage, both extracellularly in the tumor microenvironment and intracellularly within the cellular lysosomes once the antibody is internalized. We're advancing ZL-6201 into a global phase I study this year. ZL-1222 is a PD-1-targeted next generation IL-12 immunocytokine designed to leverage the antitumor potential of IL-12 while lowering the associated systemic toxicity.

Rafael Amado: ZL-6201 is a novel ADC with an internally developed high affinity and specificity for LRRC15 antibody and next generation payload linker. LRRC15 is an attractive target for cancer therapy due to its overexpression in multiple solid tumors such as sarcoma, glioblastoma, and melanoma, as well as its expression in fibroblasts in the tumor microenvironment of multiple tumors such as breast, lung, and colorectal cancer. The payload linkage system releases the payload by cleavage, both extracellularly in the tumor microenvironment and intracellularly within the cellular lysosomes once the antibody is internalized. We're advancing ZL-6201 into a global phase I study this year. ZL-1222 is a PD-1-targeted next generation IL-12 immunocytokine designed to leverage the antitumor potential of IL-12 while lowering the associated systemic toxicity.

ZL6201 and ZL1222.

Rafael Amado: CL6201 is a novel ADC with an internally developed high affinity and specificity for LRRC-15 antibody

Rafael Amado: LRC-15 is an attractive target for cancer therapy due to its over expression in multiple solid tumors such as sarcoma, glioblastoma and melanoma

Rafael Amado: As well as its expression in fibroblasts in the tumor microenvironment of multiple tumor such as lung and colorectal cancer.

Rafael Amado: The payload-linked system releases the payload by cleavage both exascellularly in the Tormac environment and intercellularly within the cellular lives of some once the antibody is internalized.

Rafael Amado: We are advancing the L6201 into a blowoff phase 13 this year.

Rafael Amado: BL1222 is a PG1 targeted next generation IL-12 in Minnesota time designed to leverage the anti-duma potential of IL-12 while lowering the associated systemic toxicity.

Rafael G. Amado: The IL-12 mutant is engineered to remain in a less potent state, reducing systemic IL-12-induced toxicity. A cis-mediated signaling process is initiated when ZL-1222 binds to PD-1. Findings from its preclinical studies demonstrate potent antitumor activity in both anti-PD-1 sensitive and resistant tumor models with improved systemic safety. These results suggest a potential role in patients who are unresponsive or resistant to current immune oncology therapies. We also expect to advance ZL-1503, an IL-13, IL-31 bispecific antibody for atopic dermatitis, into phase i development this year and will present a progress update in June. We're committed to expanding our global pipeline and progressing at least one global product to IND submission stage every year. Moving on to our key late-stage regional programs and starting with immunology.

Rafael Amado: The IL-12 mutant is engineered to remain in a less potent state, reducing systemic IL-12-induced toxicity. A cis-mediated signaling process is initiated when ZL-1222 binds to PD-1. Findings from its preclinical studies demonstrate potent antitumor activity in both anti-PD-1 sensitive and resistant tumor models with improved systemic safety. These results suggest a potential role in patients who are unresponsive or resistant to current immune oncology therapies. We also expect to advance ZL-1503, an IL-13, IL-31 bispecific antibody for atopic dermatitis, into phase i development this year and will present a progress update in June. We're committed to expanding our global pipeline and progressing at least one global product to IND submission stage every year. Moving on to our key late-stage regional programs and starting with immunology.

Rafael Amado: The L-12 newtain is engineered to remain in a less potent state, reducing systemic eye-12th induced toxicity.

Rafael Amado: A seisminated signaling process is initiated when 01222 binds to PD-1. Finding from its practical studies demonstrate potent and addomer activity in both anti-PD-1 sensitives and resistant tumor models within brute systemic safety.

Rafael Amado: This result suggests a potential role in patients who are unresponsive or resistant to

Rafael Amado: We also expect to advance ZL-1503 and IL-13, IL-31's by-specific antibody for a topic dermatitis into Phase I development this year and will present a progress updating June .

Rafael Amado: We are committed to expanding our global pipeline and progressing at least one global product to IND submission stage every year.

Rafael Amado: Now, moving on to our key late-stage regional programs and starting with immunology.

Rafael G. Amado: Our partner, argenx, announced in April that the US FDA approved VYVGART Hytrulo prefilled syringe, or BFS, for self-injection in generalized myasthenia gravis and chronic inflammatory demyelinating polyneuropathy. It is the third administration option providing additional flexibility and convenience for patients, and we're planning a CMC submission in China later this year. We'll continue to explore the potential of efgartigimod to treat other IgG-mediated autoimmune indications, including thyroid eye disease, myositis, seronegative DMG, ocular MG, and lupus nephritis. In 2025, we expect top-line results from the global phase 3 study in seronegative DMG and in the phase 2 of lupus nephritis. In January this year, we strengthened our regional immunology franchise with a pipeline-in-a-product opportunity with povetacicept, a novel dual B-cell activating factor, or BAFF, and a proliferation-inducing ligand, or APRIL, antagonist.

Rafael Amado: Our partner, argenx, announced in April that the US FDA approved VYVGART Hytrulo prefilled syringe, or BFS, for self-injection in generalized myasthenia gravis and chronic inflammatory demyelinating polyneuropathy. It is the third administration option providing additional flexibility and convenience for patients, and we're planning a CMC submission in China later this year. We'll continue to explore the potential of efgartigimod to treat other IgG-mediated autoimmune indications, including thyroid eye disease, myositis, seronegative DMG, ocular MG, and lupus nephritis. In 2025, we expect top-line results from the global phase 3 study in seronegative DMG and in the phase 2 of lupus nephritis. In January this year, we strengthened our regional immunology franchise with a pipeline-in-a-product opportunity with povetacicept, a novel dual B-cell activating factor, or BAFF, and a proliferation-inducing ligand, or APRIL, antagonist.

Rafael Amado: Our partner, Arjenix, announced in April that the U.S. FDA approved Vescar Hydrilo-Britro Surin, or BFS, for self-injection in generalized my senior gravity.

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Rafael Amado: It is the third administration option providing additional flexibility and convenience for patients, and we're planning a CNC submission in China later this year.

Rafael Amado: We'll continue to explore the potential of a Cartesian mount to treat other IGG mediated all the new indications, including thyroid eye disease, myocytosis, seronegitis, GMG, ocular

Rafael Amado: In 2025, we expect top-life results from the Global Facial Study in Seronegative T&G, and is the phase two of Lupus nephritis.

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Rafael Amado: In January this year, we strengthen our regional immunology franchise with a pipeline in a product opportunity with COVID-19. A noble dual B cell activated in factor or bath, and a proliferation inducing ligand or April antagonist.

Rafael G. Amado: We're leveraging our regional expertise and established footprint with efgartigimod to accelerate its development in renal diseases, namely IgAN and primary membranous nephropathy. China has already joined the global phase 3 RAINIER trial in IgAN, and enrollment of the interim analysis cohort has completed. Our partner, Vertex, will conduct an interim analysis once this cohort reaches 36 weeks of treatment, with the potential to file for accelerated approval in the US in the first half of 2026. We also plan to join the global pivotal phase 2/3 study in PMN this year. There are no approved therapies targeting the underlying cause of the disease, and current treatments rely on immunosuppressants or anti-CD20 monoclonal antibodies, which are associated with infection and myosuppression. In addition, a subset of these patients experiences progressive kidney function impairment despite available therapies.

Rafael Amado: We're leveraging our regional expertise and established footprint with efgartigimod to accelerate its development in renal diseases, namely IgAN and primary membranous nephropathy. China has already joined the global phase 3 RAINIER trial in IgAN, and enrollment of the interim analysis cohort has completed. Our partner, Vertex, will conduct an interim analysis once this cohort reaches 36 weeks of treatment, with the potential to file for accelerated approval in the US in the first half of 2026. We also plan to join the global pivotal phase 2/3 study in PMN this year. There are no approved therapies targeting the underlying cause of the disease, and current treatments rely on immunosuppressants or anti-CD20 monoclonal antibodies, which are associated with infection and myosuppression. In addition, a subset of these patients experiences progressive kidney function impairment despite available therapies.

Rafael Amado: We're leveraging our regional expertise and established food-pring with the Strategic Mod to accelerate its development in being of this is this namely eigen and primary member of the property.

Rafael Amado: Chen has already joined the Global Phase III Renear Trial in Eigen, an enrollment of the interim analysis cohort has completed.

Rafael Amado: Our partner, Vertex, will conduct an inter-monialysis once this cohort reaches 36 weeks of treatment with the potential to file for accelerated approval in the US in the first half of 2026.

Rafael Amado: There are no approved therapies targeting the underlying causes of the disease and current treatment rely on immunosuppressants or undiated 20 monoplonal antibodies, which are associated with infection and milder suppression.

Rafael Amado: In addition, a subset of these patients experiences progressive kidney function impairment despite available therapies.

Rafael G. Amado: In neuroscience, KarXT for schizophrenia is under review by China's NMPA since the acceptance of the NDA earlier this year, and we are awaiting the data readout from the global Phase 3 ADEPT-2 study in Alzheimer's disease psychosis later this year. In oncology, for bemarituzumab, our first-in-class FGFR2b targeting therapy for gastric cancer, we expect the data readout from the global Phase 3 FORTITUDE-101 study in the Q2 of this year. Gastric cancer poses a significant threat in China, with over 350,000 new cases each year and a five-year survival rate of less than 10% in advanced stages. There are currently no approved therapies specifically targeting FGFR2b of overexpression in gastric cancer, and we look forward to bringing this potentially transformative therapy to patients as quickly as possible.

Rafael Amado: In neuroscience, KarXT for schizophrenia is under review by China's NMPA since the acceptance of the NDA earlier this year, and we are awaiting the data readout from the global Phase 3 ADEPT-2 study in Alzheimer's disease psychosis later this year. In oncology, for bemarituzumab, our first-in-class FGFR2b targeting therapy for gastric cancer, we expect the data readout from the global Phase 3 FORTITUDE-101 study in the Q2 of this year. Gastric cancer poses a significant threat in China, with over 350,000 new cases each year and a five-year survival rate of less than 10% in advanced stages. There are currently no approved therapies specifically targeting FGFR2b of overexpression in gastric cancer, and we look forward to bringing this potentially transformative therapy to patients as quickly as possible.

Rafael Amado: In neuroscience, characteristic for schizophrenia is under review by Chanuk and MPA since the acceptance of the NDA earlier this year, and we are awaiting the data readouts from the Global Facility Adapt to Study, you know, Cymer's disease psychosis later this year.

Rafael Amado: In oncology, for the nightism of our first in class SESR2B targeting therapy for gastric cancer, we expect that data read out from the global phase 340-101 study in the second quarter of this year.

Rafael Amado: Gastric Cancer poses a significant threat in China, with over 350,000 new cases each year and a 5-year survival rate of less than 10% in advanced stages. [inaudible]

Rafael Amado: There are currently no approved therapies, specifically targeting STF-2B of power expression in gastric cancer, and we look forward to bringing this potentially transformative therapy to patients as quickly as possible.

Rafael G. Amado: We continue to make great progress across our global pipeline. We will continue to enrich it and execute existing programs with speed and precision. I look forward to sharing further updates in the coming quarters. Now, Yejing will give an overview of our financial results. Yejing?

Rafael Amado: We continue to make great progress across our global pipeline. We will continue to enrich it and execute existing programs with speed and precision. I look forward to sharing further updates in the coming quarters. Now, Yejing will give an overview of our financial results. Yejing?

Rafael Amado: We continue to make great progress across our global pipeline and we will continue to enrich it and execute existing programs with speed and precision. I look forward to sharing further updates in the coming quarters.

Rafael Amado: And now, Yee Jing, we will give an overview of our financial results. Yee Jing? Thank you, Rafael. Now, I will discuss highlights from our first quarter 2025 financial results, compared to the prior year period. Now, we will give an overview of our financial results. We will give an overview of our financial results.

Yajing Chen: Thank you, Rafael. Now I will discuss highlights from our Q1 2025 financial results compared to the prior year period. Total revenue grew 22% year-over-year to $106.5 million in the Q1, driven by increased sales for VYVGART, ZEJULA, and NUZYRA. Our base business remained strong and we began to see early contributions from our newly launched products. Our focus on financial discipline and efficiency efforts was also reflected on the expense side. R&D and SG&A as a percentage of revenue declined significantly year-over-year. R&D expenses for the Q1 increased 11% year-over-year due to upfront fees totaling $20 million for our license and collaboration agreements. Other R&D expenses decreased as a result of resource prioritization and efficiency efforts. SG&A expenses for the Q1 decreased 8% year-over-year, mainly due to strategic resource allocation and efficiency improvements.

Yajing Chen: Total revenue grew 22% year-over-year to 165 million dollars in the first quarter.

Rafael Amado: Given by increased sales for Viggaard, Vidura, and Amuseira, our base business remains strong and we began to see early contributions for our newly launched products.

Rafael Amado: Our focus on financial discipline and efficiency efforts was also reflected on the expense side.

Rafael Amado: R&D and STNA as a percentage of revenue declined significantly year-over-year.

Rafael Amado: R&D expenses for the first quarter increase 11% year-over-year. Due to upfront fees, total 20 million dollars for our licensed and collaboration agreement.

Rafael Amado: Other on the extensive decrease as a result of resource prioritization and inefficiency effort.

Rafael Amado: SQNA expenses for the first quarter decreased 8% year of a year, mainly due to strategic resource allocation and efficiency improvement.

Yajing Chen: As a result of operating leverage we're building into our business, our loss from operations decreased 20% for Q1 to $56.3 million. When you adjust our loss from operations to exclude certain non-cash items, specifically depreciation, amortization, and share-based compensation, we had adjusted loss from operations of $37.1 million in Q1, reflecting year-over-year improvement of 25%. Based on our operating plan and our anticipated revenue growth, we expect to achieve profitability on an adjusted basis by Q4 of this year. Looking ahead, we expect to deliver quarter-over-quarter total revenue growth in 2025, with a meaningful acceleration anticipated in the later part of the year. We remain confident in reaffirming our full year 2025 total revenue guidance in the range of $560 million to $590 million.

Rafael Amado: As a result of operating leverage we are building into our business, our last fund operation decreased 20% for the first quarter to 56.3 million dollars.

Rafael Amado: When you adjust our law for operations to exclude certain non-times items,

Rafael Amado: Specifically, depreciation, amortization, and share-based compensation, we had adjusted a lot for operations of $37.1 million in the first quarter, reflecting year-of-year improvement of 25%.

Rafael Amado: Based on our operating plan and our anticipated revenue growth, we expect to achieve profitability under justice basis by the fourth quarter of this year.

Rafael Amado: Looking at that, we expect to deliver a quarter-over-quarter total rally growth in 2025 with a meaningful acceleration anticipated in the later part of the year.

Rafael Amado: We remain confident in reaffirming our four-year 2025 total revenue guidance in the range of $560 million to $590 million.

Yajing Chen: This revenue forecast reflects strong growth for the VYVGART franchise, continued growth for our base business, including NUZYRA and ZEJULA, and contributions from our newly launched products, including AUGTYRO and XACDURO.

Rafael Amado: This 24-hats reflects strong growth for the physical franchise, continued growth from our base business, including Nezaira and Vigula, and contributions from our newly launched products, including Atairo and Zacturo.

Samantha Du: We are in a strong financial position, ending the quarter with a cash position of $857.3 million. With that, I would now like to turn the call back over to the operator to open up line for questions. Operator?

Rafael Amado: We are in a strong financial position, and in a quarter with a cash position of 857.3 million dollars.

Rafael Amado: And with that, I would now like to turn the call back over to the operator to open up line for question operator.

Operator: We will now begin the question and answer session. To ask a question, please press star one one and wait for your name to be announced. To cancel your request, please press star one one again. One moment for the first question. Our first question comes from Michael Yee from Jefferies. Please go ahead.

Speaker Change: We will now begin the question and answer session. To ask a question, please press star 111 and wait for a name to be announced.

To cancel your request, please press Star 11 again.

[inaudible]

One moment for the first question.

Michael Yee: Our first questions comes from Michael Yee from Jefferies. Please go ahead.

Michael Yee: Thank you. Good morning. Congrats on the results and the outlook for the year. We had two questions. First, just on VYVGART, maybe the team could add a little bit more color. Obviously, the number was sequentially down and would be eye-opening. Can you just maybe describe was a lot of the sequential change inventory changes or just seasonality of purchasing? Is your confidence in the guidance based specifically on your awareness of what's going on in April and into May? The second question is a strategic question, maybe for Samantha. Obviously, you're seeking to become more of a global company. Are you seeking to bring in more Chinese assets to be wholly owned this year? How should we think about some more deals in terms of a wholly owned pipeline? Thank you.

Michael Yee: Thank you, good morning, congrats on the results and the outlook for the year.

We have two questions, first.

Speaker Change: Just on Vivgart, maybe the team could add a little bit more color.

Obviously the number was sequentially down.

Speaker Change: and would be eye-opening, but can you just maybe describe was a lot of the sequential change inventory changes or just seasonality of purchasing? [inaudible]

Speaker Change: and is your confidence in the guidance based specifically on your awareness of what's going on in April and into May?

And then the second question is a strategic question, maybe...

Speaker Change: For Samantha, obviously you're seeking to become more of a global company. Are you seeking to bring in more Chinese assets to be wholly owned this year? And how should we think about some more deals in terms of a wholly owned pipeline? Thank you.

Josh Smiley: Thanks, Michael Yee. It's Josh Smiley. I'll start with VYVGART and then hand it over to Samantha Du to make some comments on your second question. First, on VYVGART, I would say, you know, as you heard in the call and in our press release, we're reiterating our total sales guidance for the year, $560 to $590 million. You know, that implies a growth rate in the, you know, mid to high 40%, depending on the range. We are also reiterating that we expect VYVGART itself to grow faster than the overall sales growth. I think if you look at Q1 to your question, we did see seasonality in January and February in, I think, patient utilization.

Thank you. Thank you. Thank you.

Speaker Change: Thanks Mike, it's Josh. I'll start with Vivgart, and then hand it over to Samantha to make some comments on your second question. I personally, Vivgart, I would say, you know, as you heard in the call and in our press release, we're reiterating our total sales guidance for the year, $560 million to $590 million.

Speaker Change: You know, that implies the growth rate in the, you know, mid to high 40, depending on the range. And we are also reiterating that we expect a VivGuard itself to grow faster than the overall sales growth. So I think if you look at Q1 to your question, we did see seasonality in January and February in, and I think patient utilization. So patient utilization.

Josh Smiley: Of course, we, you know, all products experience this to some degree in China, given Chinese New Year. IV products, particularly, you know, if you think about VYVGART, it requires, when you're in a cycle, a weekly trip to a hospital for an infusion. As probably anticipated, we saw some of those visits being delayed. We saw good recovery of patient volumes and utilization in March and a really strong April. I think if we look at our April patient utilization and patient numbers, it's our highest ever and, you know, at least 10% better than anything we've seen to date. We're quite confident about the progress for the year for VYVGART.

Speaker Change: Of course, we, you know, all products experience this to some degree in China, given Chinese New Year, IV products particularly, you know, if you think about Vibgarde, it requires when you're in a cycle, a weekly trip to a hospital for an infusion and and. You know, I, I, I, I, I, I,

Speaker Change: You know, as probably anticipated, we saw some of those visits being delayed, we saw good recovery of patient volumes and utilization in March and really a really strong April . I think we look at our April . [inaudible]

Speaker Change: Patient Utilization, and Patient Numbers. It's our highest ever, and at least 10% better than anything we've seen today. So we're quite confident about the...

Josh Smiley: I think the utilization piece was, you know, an issue in January and February and, you know, not totally unexpected given what we know about China. Hopefully in future years, this will be less of an issue as we have products like, or you know, formulations like a SubQ and the prefilled syringe, which wouldn't require hospital visits per se. We did have some inventory moves as well as you asked. As you remember from Q4, we got approval for Hytrello last year. We did ship Hytrello to get it into the channel. You know, until we get NRDL listing, which we're pursuing for 2026, we're gonna see limited usage there. There was some inventory move there.

Speaker Change: The progress for the year for Viv Garden, I think the utilization piece was, you know, an issue in January and February and

Speaker Change: You know, not totally unexpected to even what we know about China. Hopefully in future years this will be less of an issue as we have products like, you know, formulations like a sub queue and the pre-filter in which wouldn't require hospital visits per se. But we did have some inventory moves as well as you as you as you remember from Q4. We got approval for high trullo last year we did ship.

Speaker Change: High Cruelow to get it into the channel and until we get NRDL listing which we're pursuing for 2026.

Josh Smiley: Again, I'd say we're quite confident about the outlook for the year for VYVGART. See really good progress in terms of new patients, patient duration, and, you know, we're seeing that in April and May, as you suggested. For your question about overall how we're thinking about the strategy and company, I'll ask Samantha to make some comments.

Speaker Change: We're going to see limited usage there, so there was some inventory move there. But again, I think we're quite confident about the outlook for the year for Viv Gart see really good progress in terms of new patients. We're going to see the end.

Speaker Change: patient, duration, and you know we're seeing that in April and May as he's suggested. For your question about overall how we're thinking about the strategy and company I'll ask Samantha to make some comments.

Samantha Du: Thank you, Josh. Thank you, Michael, for the question. As you know, we are a company focused on not only China regional rights, but also for global rights. We have a very strong BD team, which has a strong coverage in China as well as in the US in the rest of the world. If we, but of course, we have very high bar. If we see anything we think have high potential to have a differentiated products, we will definitely go for it. Thank you, Michael.

Thank you, Josh. And thank you, Michael, for the question.

Speaker Change: As you know, we are a company focused on not only China's regional rights but also for global rights.

Speaker Change: We have a very strong BD team which has strong coverage in China as well as in the rest of the world.

Speaker Change: So if we, but of course we have very high bar, but if we see anything we think have high potential to have a differentiated product, we will definitely go for it. Thank you Michael.

Michael Yee: Thank you.

Thank you.

Operator: Thank you for the question. One moment for the next question. Our next question comes from the line of Louise Chen from Scotiabank. Please ask your question.

Speaker Change: Thank you for the question. One moment for the next question.

Speaker Change: Our next questions comes from the lawyer Louise Chen from Scorsia Bang. Please ask your questions.

Louise Chen: Hi. Thank you for taking my questions here. Wanted to ask you a few questions here. First of all, are you comfortable with where consensus is today for VYVGART and then for the fiscal year revenues? I also wanted to ask you on Bema 101 study. We would have expected to see something here. Has there been any delay or anything to read into this? Thank you.

Louis Chen: Hi. Thank you for taking my questions here. So I wanted to ask you a few questions here. First of all, are you comfortable with where consensus is today for Vivgart and then for the fiscal year revenues?

Speaker Change: And then also wanted to ask you on BIMA 101 study, we would have expected to see something here, has there been any delay or anything to read into this? Thank you.

Josh Smiley: Thanks, Louise. It's Josh. I'll do the first piece and then Rafael can talk about bemarituzumab. I think first, as it relates to overall consensus, you know, as I mentioned, we're reaffirming $560 to $590 for the year. We feel good about that range. We're not giving, you know, specific product level guidance, but I think if you look at VYVGART, I think the consensus is sort of in line with what I mentioned in the last question, which is, you know, VYVGART sales for the full year growing at faster than the overall implied business rates. I think that, you know, that puts us in range with what I see for consensus now.

Speaker Change: Thanks Louise, Josh, I'll do the first piece, and then Rafael can talk about BIMA. I think first as it relates to overall consensus, as I mentioned, we're reaffirming [inaudible]

Speaker Change: 560-590 for the year, we feel good about that range.

Josh Smiley: Again, we're off to a really good, you know, last couple of months, start for Q2 and feel good about the progress for Vyvgart and for the business overall. Rafael, you could talk about bemarituzumab, please.

Rafael G. Amado: Sure. bima, for the 40101 study, which is the chemotherapy plus minus bima in FGFR2b expressing tumors, the data is expected in Q2 of this year. I would not really read anything into whether or not it has been released yet or not. It's an interim analysis, and we're pretty excited both about the design of the study and also the potential for this drug to really impact the lives of patients with these tumors with this alteration. Particularly based on the results of the Phase 2 study, which was quite large, compared to what we've been seeing with Nivolumab, encorafenib, and some of the other products that have been added to gastric cancer.

Rafael Amado: Sure. bima, for the 40101 study, which is the chemotherapy plus minus bima in FGFR2b expressing tumors, the data is expected in Q2 of this year. I would not really read anything into whether or not it has been released yet or not. It's an interim analysis, and we're pretty excited both about the design of the study and also the potential for this drug to really impact the lives of patients with these tumors with this alteration. Particularly based on the results of the Phase 2 study, which was quite large, compared to what we've been seeing with Nivolumab, encorafenib, and some of the other products that have been added to gastric cancer.

Progress for Viv Gart, and for the business overall. Rafael, you could talk about FEMA, please.

Sure, so being for the 40-101 study, which is...

The chemotherapy plus minus B9 and FTFR to be expressed in tumors.

Speaker Change: The data is expected in the second quarter of this year.

Speaker Change: I would not really read anything into whether or not it has been released yet or not.

Etening Dural Analyses

Speaker Change: And we're pretty excited both about the design of the study and also the potential for this drug to...

Speaker Change: Really impact the lives of patients with these tumors with this alteration, particularly based on the results of the phase 2 study which was quite large.

Speaker Change: compared to what we've been seeing with Nivoma, Vaughan, Claudine, and some of the other products that have been added to gastric cancer. So I would just say stay tuned and I'm confident that we will get this data in the second quarter.

Rafael G. Amado: I would just say, stay tuned and I'm confident that we will get this data in Q2.

Rafael Amado: I would just say, stay tuned and I'm confident that we will get this data in Q2.

Linhai Zhao: Thank you.

Operator: Thank you for the question. One moment for the next question. Your next question comes from the line of Jonathan Chang from Leerink Partners. Please go ahead.

Thank you.

Speaker Change: Thank you for the question. One moment for the next question.

Thank you for watching!

Speaker Change: Your next questions comes from the lie of Jonathan Chang from Learing Partners, please go ahead.

Yen-Der Li: Hi. Good morning. This is Yen-Der Li, for Jonathan Chang. Thanks for taking my question. I have two questions. The first one, can you provide some colors on how recent change in the FDA and also maybe tariff might impact Zai Lab going forward? How do you estimate these risks, in the current financial guidance? Thank you.

Thank you for watching!

Yander Li: Hi, good morning. This is Yender Li, for Jonathan Chang. Thanks for taking my question.

Yander Li: So I have two questions on the first one. You provide some colors on how recent change in the FDA and also maybe tariffs might impact Zai Lab going forward. And how do you estimate these risks in the current financial guidance? Thank you.

Josh Smiley: I'll start with the tariff piece and then ask Rafael to make some comments on FDA, and then, Samantha, if you have anything at the end you want to add, please do. I think first on tariffs, we don't see any impact to our business today or anticipated in the future. Obviously, tariffs are sort of a fluid situation. If you know, look at where we sell product today in China, we have local rights to manufacture product. Any of our regional deals we can manufacture in China. We do that, for example, with ZEJULA and are in the process for our big new launches, like Bima and KarXT to bring that manufacturing locally.

https://www.youtube.com

Speaker Change: I'll start with the tariff piece in the NASCAR, Rafael, to make some comments on FDA, and then Samantha, if you have anything at the end, you want to add, please do. But I think first on tariffs, we don't see any impact to our business today or anticipated in the future, obviously tariffs are sort of a fluid situation, but if you look at...

Speaker Change: Where we sell product today in China, we have local rights to manufacture product, any of our regional deals we can manufacture in China, we do that.

Speaker Change: For example, with the Julen, or in the process for our big new launches, like Beema and Karek's tea to...

Josh Smiley: Other products today that we don't make locally, like VYVGART are sourced out of Europe and Asia, not out of the US. We really anticipate no impact on tariffs today for our revenue base. As we think about going forward and products like DLL3, which we anticipate launching in the US in 2027, we'll manufacture that locally from a commercial perspective, so we won't be exposed to tariffs coming into the US there either. Rafael, if you wanna make some comments about recent FDA interactions.

to bring that manufacturing locally.

Speaker Change: Other products today that we don't make locally like Vivgart, our source out of Europe and Asia, not out of the US. So we really anticipate no impact on on tariffs today for a revenue basis. We think about going forward and products like the LL3 which we anticipate launching in the US in 2027. We'll manufacture that locally from a commercial perspective. So we won't be exposed to tariffs coming

Rafael Amado: in the U.S. there, either. Rafael, if you want to make some comments about recent FDA interactions.

Rafael G. Amado: Very briefly, I would say that, you know, most of our products are, we interact with CDER at FDA. You know, we recently had interactions with FDA on ZL-1310. We really saw no difference, you know, based on my experience of developing drugs with regards to the nature of those interactions. Of course, this is a macro question of how, you know, FDA will evolve in the future with the new commissioner and FDA appointing heads of both CDER and CDER, we will have to see, you know, how that shapes up. So far, we in our products have seen really no impact with regards to, you know, their advice and the way that we've been able to interact with them, including timelines.

Rafael Amado: Very briefly, I would say that, you know, most of our products are, we interact with CDER at FDA. You know, we recently had interactions with FDA on ZL-1310. We really saw no difference, you know, based on my experience of developing drugs with regards to the nature of those interactions. Of course, this is a macro question of how, you know, FDA will evolve in the future with the new commissioner and FDA appointing heads of both CDER and CDER, we will have to see, you know, how that shapes up. So far, we in our products have seen really no impact with regards to, you know, their advice and the way that we've been able to interact with them, including timelines.

Rafael Amado: The other briefly, I would say that most of our products are winded up with cedar at FDA. We recently had interactions with FDA.

on 1310.

Rafael Amado: Seater on Seater, but we will have to see, you know, how that shapes up.

Yen-Der Li: Understood. Very helpful. Thank you. My second question is about-

[inaudible]

Speaker Change: Unsponsored, very helpful. Thank you. And my second question is about

Operator: Pardon for the interruptions. Please repeat the question, please.

Yen-Der Li: On the study design. Thank you.

on the study design. Thank you.

Rafael G. Amado: There was a silence, at least for me. Can you please repeat the question?

Rafael Amado: There was a silence, at least for me. Can you please repeat the question?

Speaker Change: There was a silence, can you please repeat the question?

Yen-Der Li: Oh, yeah, sorry. I'm asking, please share your thoughts on the pivotal trial design for ZL-1310 in most lung cancer. Also, can you share how far you are in reaching an agreement with the FDA for the study design? Thank you.

Speaker Change: Oh, yeah, sorry. I'm asking, like, to share your thoughts on the pivotal trial design for CL3010 in Mosul & Cancer, and also can share how far you are in reaching the agreement with the FDA for the study design. Thank you.

Rafael G. Amado: Oh, thank you for the question. Yes. Our interactions with FDA have been very productive. We obviously have generated a lot of monotherapy data. The current plan is to launch a randomized pivotal trial for registration. We think, and, and have reasons to believe that the accelerated approval pathway remains open. That can be achieved in a randomized trial by comparing response rates. Then the final post-approval commitment will be within the same study, looking at overall survival. The study will be powered for overall survival, and the response rate will be an interim analysis for accelerated approval. That's our current plan, and we plan to start that study this year as soon as we have the dose.

Rafael Amado: Oh, thank you for the question. Yes. Our interactions with FDA have been very productive. We obviously have generated a lot of monotherapy data. The current plan is to launch a randomized pivotal trial for registration. We think, and, and have reasons to believe that the accelerated approval pathway remains open. That can be achieved in a randomized trial by comparing response rates. Then the final post-approval commitment will be within the same study, looking at overall survival. The study will be powered for overall survival, and the response rate will be an interim analysis for accelerated approval. That's our current plan, and we plan to start that study this year as soon as we have the dose.

Speaker Change: Oh, thank you for the question. Yes, so our interactions with FDA have been very productive. We obviously have generated a lot of monotherapy data.

Speaker Change: and have reasons to believe that the accelerator approval pathway remains open and that can be achieved in a randomized trial by comparing response rates.

Speaker Change: and then the final possible improvement will be within the same study.

Speaker Change: Looking at overall survival. So the study will be powered for overall survival and the sponsor will be an interim analysis for us to learn about the world. So that's our current plan. And we're going to start that study this year, as soon as we have the dose.

Jonathan Wang: Understood. Thank you so much.

Yen-Der Li: Understood. Thank you so much.

Operator: Thank you for the questions. One moment for the next question. Next question comes from the line of Li Watsek from Cantor Fitzgerald. Please go ahead.

In the name of God, God, God, God, God, God, God, God, God, God

Thank you so much.

In the name of God, God, God, God, God, God, God, God, God

Speaker Change: Thank you for the questions. One moment for the next question.

[inaudible]

Speaker Change: Next questions come from the light of Lee Wat Sixh from Cantol, please go ahead.

Li Watsek: Hey, guys. Thanks for taking our questions. Maybe a couple here. Just wondering on, you know, VYVGART, can you talk a little bit about the competitive landscape of gMG in China, given there are some other therapies that might get approval in the near term? How do you see the sort of competitive dynamics playing out in the near and longer term? The second question is on, you know, the BD efforts. Just given the uncertainty of tariff, tariffs and geopolitical tensions, what are you seeing in terms of big pharma's, you know, appetite to out-licensing the commercial rights in China? You know, just in general, anything from the macro side, have shifted your thinking around in-licensing.

Speaker Change: Hey guys, thanks for taking our questions. Maybe a couple here.

Speaker Change: I'm just wondering on, you know, these guards, can you talk a little bit about the competitive landscape of Jim Ji in China?

Speaker Change: Given there are some other therapies that might get approval in the near term, how do you see the total competitive dynamics playing out in the near and longer term? And the second question is on, you know, the BD efforts?

Speaker Change: Just given the uncertainty of tariffs and geopolitical tensions, what are you seeing?

Speaker Change: in terms of big farmers, you know, epitome to out licensing, the commercial rising China, and, you know, just in general anything from the macro side have shifted your thinking around in licensing.

Josh Smiley: Thanks, Li. It's Josh. I'll do VYVGART and ask Jonathan to make some comments on business development. I think on VYVGART, first, I'd just remind everybody there's, you know, it's a very big opportunity in China for gMG, about 170,000 patients. While we're really happy with where we are today, you know, we still have less than 10% of patients who are getting a newer biologic therapy. You know, in one sense, I think having, you know, more newer agents approved and in the market is gonna be good for everyone, and it'll be good for VYVGART as we continue to educate physicians and get them to adopt the new and best therapies.

Speaker Change: Thanks, Lee. It's Josh. I'll do Vivgart and Asuka, Jonathan, to make some comments on business development. I think on Vivgart, first I just remind everybody there's, you know, it's a very big opportunity in China for GMG about 170,000 patients. And while we're really happy with where we are today, you know, we still have less than 10% of patients who are getting a new or biologic therapy. So, you know, in one sense, I think [inaudible]

Speaker Change: Having more new agents approved in the market is going to be good for everyone, and it'll be good for we have guard as we continue to educate physicians and get them to adopt.

Josh Smiley: I think as we compare where we are with Vyvgart to other recent approvals or anticipated approvals, we love the position we're in. We've got a comprehensive data set. I think if you look at, you know, the results around activities of daily living or, you know, getting back to sort of as much normalcy as possible, our data is strong, compelling, and I think stacks up well against any of the FcRns or other newer agents that are either approved or headed towards approval. We obviously have this year as the only newer agent on NRDL, and we'll continue to, you know, build our experience and expertise there.

Speaker Change: The New and Best Therapies. I think that as we compare where we are with Viv Gart to other recent approvals or anticipated approvals, we love the position we're in. We've got a comprehensive data set. I think if you look at the

Josh Smiley: I think longer term, what, you know, between efficacy, and I think if you look at safety across the FcRn and other agents, again, we feel very good about where we are from that perspective. We welcome new approvals. Again, I think it's gonna be good for patients and good for treating physicians to have options and to have more education in the market. It doesn't change our view in terms of how we see progress this year. As I've said, we're quite excited about what we're seeing today in the market with VYVGART. Of course, we have a series of new indications coming as well that'll help, I think, bolster our competitiveness versus, you know, anticipated new approvals. You know, of course, we have CIDP.

and David Patterson. Thank you. Thank you. Thank you.

Speaker Change: Expertise there, but I think longer term between efficacy and I think if you look at safety across the SCRNs and other agents

Speaker Change: Again we feel very good about where we are from that perspective so we welcome new approvals and again I think it's going to be good for patients and good for treating physicians to have options and to have more education in the market and it doesn't change our view in terms of.

Speaker Change: How we see progress this year, as I said, we're quite excited about what we're seeing today in the market with Viv Gart.

Speaker Change: Of course, we have a series of new indications coming as well that will help, I think, bolster our competitiveness versus...

Josh Smiley: We've got new formulations coming that we'll be pursuing for NRDL. Over the course of the next few years, we'll have more supplemental indications for MG. We also anticipate other indications, including things like thyroid eye disease, where we're running trials in conjunction with argenx today. I think the future is very bright for VYVGART and for patients in China with gMG. Jonathan, if you wanna address the business development question.

Speaker Change: You know, anticipated new approvals. You know, of course, we have CIDP. We've got new formulations coming that we'll be pursuing for NRDL. And over the course of the next few years, we'll have more. Thank you for your time, and we'll see you in the next few years.

Speaker Change: Supplemental Indications for MG. We also anticipate other indications, including things like thyroid eye disease, where we're running trials and conjunction with our genics today.

Speaker Change: So I think the future is very bright for VivGuard and for patients in China with GMG. Jonathan, if you want to address the business development question.

Jonathan Wang: Sure. Thanks, Josh, and thanks for the question. On the BD sort of impact from the geopolitical situation, you know, I think the first is that so far there has been no suggestions, you know, no sort of regulatory prohibition from the administration with regards to any licensing, you know, transactions between life sciences companies. You know, so far, I think it's business as usual. We have been doing deals as, you know, earlier this year as well. You know, we continue to evaluate deals. In fact, sometimes I think volatility creates opportunities. Multinational companies are increasingly looking to China for innovation and looking to China also for commercial opportunities. There has been a lot of visits, increasing number of visits by multinational business development heads as well as CEOs.

Thank you.

Speaker Change: Sure. Thanks, Josh, and thanks for the question. On the BDE sort of impact from the geopolitical situation. I think the first is that

Speaker Change: So far there has been no suggestions, no sort of...

Speaker Change: Any licensing transactions between life science companies. So far I think it's business is usual. We have been doing deals earlier this year as well, so we continue to evaluate deals. In fact sometimes I think volatility creates opportunities. [inaudible]

Jonathan Wang: You know, just today, actually, Samantha myself met, you know, several multinational CEOs here. You know, we expect to continue to do deals in this environment. You know, obviously, as Samantha earlier said, I think the bar is always very high for us. Quality is the most important. I don't think the current situation will prohibit us, certainly not from doing any deals. Thank you.

Speaker Change: In theory, I think the bar is always very high for us. Query is the most important, but I don't think the current situation will prohibit us, certainly not from doing any deals. Thank you.

Li Watsek: Great. Thanks, guys.

Thank you guys.

Operator: Thank you for the questions. Our next question comes from the line of Yigal Nochomovitz from Citi. Please go ahead.

Speaker Change: Thank you for the questions. Our next question comes from July , Yigal Nochomovitz from City. Please go ahead.

Yigal Nochomovitz: Hi. Thank you. One for Josh and two for Rafael. Josh, just could you outline the scenarios with regard to how the NRDL will help with negotiation of the price for VYVGART? I'm just curious, is there some sort of a cap in terms of how much it can get negotiated down, or is there a floor? Is this gonna apply to both IV and SubQ pricing terms? For Rafael, with the FORTITUDE-101 and FORTITUDE-102, I'm just curious, you know, how you're thinking about the competitive dynamics and whether the JAZZ trial with zolbetuximab chemo and the BeiGene PD-1 impacts your thinking about the competitive landscape, or maybe not so much considering you're focused on FGFR2b patients.

In the name of God, God, God, God, God, God, God, God, God

Yigal Nokomovitz: Hi, thank you. I have one for Josh and two for Rafael. Josh, I'm just could you outline the scenarios with regard to how the ADRL will help with negotiation of the price for Vivgart.

Speaker Change: I'm just curious, is there some sort of a cap in terms of how much you can get negotiated down? Or is there a floor? And is this going to apply to both IV and sub-Q pricing terms? And then for Rafael?

Speaker Change: with the Fortitude 101 and Fortitude 102. I just curious, you know, how you're thinking about the competitive dynamics.

Speaker Change: and whether the jazz trial with Zen Datamab, Kimo, and the Beijing PD-1 impacts you're thinking about the competitive landscape or maybe not so much considering your focused on FGFR to be patients.

Yigal Nochomovitz: Last question, with regard to the ADCs, the DLL3 and the LRRC15, just curious about the antibody engineering there and whether you've tuned these antibodies to cleave mainly intracellularly or if there's also extracellular cleavage? Thank you.

Speaker Change: And then last question, with regard to the ADC, the OLL-3 and the LLR-C-15,

Speaker Change: Just curious about the antibody engineering there, and whether you've tuned these antibodies to cleave mainly interestingly, or if there's also extracellular cleavage, thank you.

Rafael G. Amado: Thanks, Ygal. you know, we've got Jonathan on the phone. Jonathan leads our pricing work in China, so I'll ask him to comment on the NRDL process for VYVGART for 2026. We can pass it on to Rafael.

Rafael Amado: Thanks, Ygal. you know, we've got Jonathan on the phone. Jonathan leads our pricing work in China, so I'll ask him to comment on the NRDL process for VYVGART for 2026. We can pass it on to Rafael.

Speaker Change: Thanks, Yigal. You know, we've got Jonathan on the phone. Jonathan leads our pricing work in China, so I'll ask him to comment on the NRDL process for VivGuard for 2026. Then we can pass it on to Rafael.

Jonathan Wang: Sure. You know, Yigal, I think, for VYVGART, we have two formulations, first of all. Each of these formulations as subQ and IV will be treated as different products. We have a lot of flexibility when it comes to pricing. Of course, the NRDL negotiation will happen potentially earlier this year as well. As they do this, sort of the timeline is brought forward, so they also look at the sales from last year and Q1 this year. You know, we expect potential modest discounts to the pricing. Obviously subject to negotiations, too early to comment on the precise pricing, we would expect probably some discount there.

Speaker Change: Sure, Yigal, I think, for Vivgar, we have two formulations, first of all. Each of these formulations in the subcure and IV will be treated as different products.

Speaker Change: So we have a lot of flexibility when it comes to pricing.

Speaker Change: Of course, the NADO negotiation will happen potentially earlier this year as well.

Speaker Change: So as they do this sort of the timelines brought forward, so they also look at the sales from last year and quarter one this year.

Speaker Change: But, you know, we expect potential modest discounts to the pricing obviously subject to negotiations to early to comment on the precise pricing but we would expect probably some discount there.

Rafael G. Amado: Yeah. I'll take.

Rafael Amado: Yeah. I'll take.

Anupam Rama: Hey, Rafael.

Rafael G. Amado: Yeah, I'll take the R&D question. Yeah, there is some competition in gastric cancer. It is generally for HER2 negative disease. We, you know, still have yet to see, you know, what effect these new products will have. Clearly, they've been promising in other settings. Because this is specific for an alteration that is present in about a third of patients, and we're looking at at least at 10% expression, so these are patients where their tumors is driven by this oncogene, and we are silencing this oncogene. We feel pretty positive about it. Our second study also includes a PD-1 inhibitor, as you know, nivolumab.

Rafael Amado: Yeah, I'll take the R&D question. Yeah, there is some competition in gastric cancer. It is generally for HER2 negative disease. We, you know, still have yet to see, you know, what effect these new products will have. Clearly, they've been promising in other settings. Because this is specific for an alteration that is present in about a third of patients, and we're looking at at least at 10% expression, so these are patients where their tumors is driven by this oncogene, and we are silencing this oncogene. We feel pretty positive about it. Our second study also includes a PD-1 inhibitor, as you know, nivolumab.

Thank you. Bye.

Generally for heart-to-negative disease.

Speaker Change: We still have yet to see what effect these new products will have, clearly they've been promising in other settings.

Thank you. Bye.

because this is specific for inauguration.

that is presenting in about a third of patients.

Speaker Change: And we're looking at at least 10% expression, so these are patients where their tumors is driven by this oncogene and we are silencing this oncogene.

Speaker Change: Our second study also includes the B-Warning Heavitor, Ashiq No Nevolumon.

Rafael G. Amado: We will have to see what happens with the competition, but we think these studies are pretty well designed, and they're targeted to the alteration that the disease manifests. With regards to the antibodies, DLL3 was engineered to have picomolar activity, and I think that's bearing out in what we're seeing in the clinic. LRRC15 is internally developed, and they both are conjugated with a system whereby there's a release of the payload after internalization of the intact molecule, as well as cleavage in the extracellular matrix.

Rafael Amado: We will have to see what happens with the competition, but we think these studies are pretty well designed, and they're targeted to the alteration that the disease manifests. With regards to the antibodies, DLL3 was engineered to have picomolar activity, and I think that's bearing out in what we're seeing in the clinic. LRRC15 is internally developed, and they both are conjugated with a system whereby there's a release of the payload after internalization of the intact molecule, as well as cleavage in the extracellular matrix.

Speaker Change: With regards to the antibodies, the yellow three was engineered to have become all our activity and I think that's very now in some of the world we're seeing in the clinic.

Speaker Change: There's a release of the payload after the internalization of the intact molecule.

Rafael G. Amado: That's why, with LRRC15 we're excited about the fact that the target may just be a flag, and whether it's in the tumor or it's in the malignant fibroblast, there will still be a strong bystander effect. We don't see a really high levels at all of the payload in circulation, but it is in the tumor microenvironment, and I think it's due to the second generation payload linker system.

Speaker Change: as well as cleavage in the extracellular matrix. That's why with the LR616 we were excited about the fact that the target may just be a flag and whether it's in the tumor or it's in the malignant fibroblast.

Rafael Amado: That's why, with LRRC15 we're excited about the fact that the target may just be a flag, and whether it's in the tumor or it's in the malignant fibroblast, there will still be a strong bystander effect. We don't see a really high levels at all of the payload in circulation, but it is in the tumor microenvironment, and I think it's due to the second generation payload linker system.

Speaker Change: There will still be a strong bystander effect, so we don't see a really high level of the payload in circulation, but it is in the tumor microenvironment and I think it's due to the second generation

Yigal Nochomovitz: Thank you.

Anupam Rama: Thank you for the question. Our next question comes from Anupam Rama from J.P. Morgan. Please go ahead.

Operator: Thank you for the question. Our next question comes from Anupam Rama from J.P. Morgan. Please go ahead.

In the name of God, God, God, God, God, God, God, God, God, God

Thank you.

In the name of God, God, God, God, God, God, God, God, God, God

Thank you for the question.

Speaker Change: Our next questions comes from Anupam Ram from JP Morgan, please go ahead.

Anupam Rama: Hey, guys. Thanks so much for taking the question. Quick one from me. Just what's gonna be the size and scope of the ZL-1310 ASCO update, and what would you have us focusing on the data at ASCO? Thanks so much.

In the name of God, God, God, God, God, God, God, God, God

Speaker Change: Hey guys, thanks so much for taking the question. Quick one for me, what's going to be the size in the scope of the Team 10 ASCO update and what would you have us focusing on the data at ASCO? Thanks so much.

Rafael G. Amado: The ZL-1310 data that we've presented was with 25 patients. There were 19 patients eligible for efficacy, that was dose escalation. Since that presentation, we've completed the dose escalation with a few more patients, and every patient has had an opportunity to have a confirmatory scan. We will have the complete data set for dose escalation. The other data set that will be new will be the dose optimization. I think there, it will be really a focus on, you know, which dose or doses are looking most promising to be included as the dose in the pivotal trial in the Phase 3 study.

Rafael Amado: The ZL-1310 data that we've presented was with 25 patients. There were 19 patients eligible for efficacy, that was dose escalation. Since that presentation, we've completed the dose escalation with a few more patients, and every patient has had an opportunity to have a confirmatory scan. We will have the complete data set for dose escalation. The other data set that will be new will be the dose optimization. I think there, it will be really a focus on, you know, which dose or doses are looking most promising to be included as the dose in the pivotal trial in the Phase 3 study.

So,

Speaker Change: The 1310 data that we presented was with 25 patients. There were 19 patients eligible for efficacy, so that was dose escalation. Since that presentation we've completed the dose escalation with a few more patients.

Speaker Change: and every patient has had an opportunity to have a confirmatory scan so we will have the complete

Speaker Change: and then the other data said that will be new will be the dose optimization and I think they are, it will be really a focus on which dose.

or Doses are looking most promising.

Speaker Change: to be included as the dose in the pivotal trial in the Phase III study.

Rafael G. Amado: In terms of numbers, you know, as I said, we have a few more patients than at DNA in the dose escalation, and we should have, you know, another 50 patients or so in the dose optimization. I think the focus for me would be, you know, what is the dose that has the broader therapeutic benefit as we have been marching on the dose optimization with the knowledge that we've accrued rapidly and that the follow-up is not going to be very long. At least we'll have responses and we will have durability of response in the earlier patients that we enroll. Thanks so much for taking our questions.

Rafael Amado: In terms of numbers, you know, as I said, we have a few more patients than at DNA in the dose escalation, and we should have, you know, another 50 patients or so in the dose optimization. I think the focus for me would be, you know, what is the dose that has the broader therapeutic benefit as we have been marching on the dose optimization with the knowledge that we've accrued rapidly and that the follow-up is not going to be very long. At least we'll have responses and we will have durability of response in the earlier patients that we enroll. Thanks so much for taking our questions.

Speaker Change: In terms of numbers, we will, as I said, we have a few more patients than R&A in the dose installation. And we should have another 50 patients or so in the dose optimization.

So I think the focus for me would be...

Speaker Change: You know, what is the dose that has the broader therapeutic benefit as we have been marching on the dose optimization with the knowledge that we've accrued rapidly and the follow-up is not going to be very long but at least we'll have responses and

Speaker Change: and we will have durability of response in the earlier patients that we enroll.

Operator: Thank you for the questions. One moment for the next question. Next question comes from the line of Linhai Zhao from Goldman Sachs. Please go ahead.

Thanks so much for taking our questions.

Speaker Change: Thank you for the questions. One moment for the next question.

Speaker Change: Next question comes from the line on Ling Hai Zhao from Goldman Sachs. Please go ahead.

Linhai Zhao: Operator, do you want to move to the next question?

Christine Chiou: Operator, do you want to move to the next question?

Operator, do you want me to move to the next question?

Josh Smiley: We can't hear anything on this side.

We can't hear anything on this side.

Operator: I beg your pardon. Allow me to take the next question. Our next question comes from the line of Jack Lin from Morgan Stanley. Please go ahead.

Speaker Change: Hi, back to your pardon. Allow me to take the next question.

Speaker Change: Our next questions come from July or Jacqueline from Borgon Stanley. Please go ahead.

Jack Lin: Hi. Good morning. Are you able to hear me?

Josh Smiley: Yes.

Hi, good morning. Are you able to hear me?

Jack Lin: Hi. Thank you for taking my question. I just have two quick ones. First, I was wondering, you know, this is a very big SG&A improvement. I was wondering if you guys will be able to kind of share more in terms of, you know, what kind of initiatives were taken this quarter specifically to help reduce the SG&A to this degree.

Yes!

In the name of God, God, God, God, God, God, God, God, God, God

Speaker Change: Thank you for taking my question. I just have two quick ones. First, I was wondering, this is a very big SG&A improvement. I was wondering if you guys will be able to share more in terms of what kind of initiatives were taken this quarter specifically to help reduce the SG&A to this degree and how much we will be able to continue leveraging out for the following quarters, how many of these actually, I guess, one time. Thank you very much. Thank you very much.

Josh Smiley: Mm.

Jack Lin: You know, how much we'll be able to continue leveraging on for the following quarters, how many of these are actually, I guess, one time thing, yeah, that you, if you probably kind of break down how this was achieved? The second one is just kinda on where we stand as far as TTFields. You know, I see that the pancreatic cancer data is gonna present at the ASCO as well. Just kinda wondering where our focus is at right now, kinda how our strategy is going moving forward. Thank you.

Speaker Change: And, yeah, that's you, if your public's gonna break out, how this was achieved. And the second one's just kinda on the word we send, as far as CTF, and I see that, the uh...

Speaker Change: Integrated Cancer Data. It's going to present at the S code as well. And just kind of wondering where our focus is that right now, kind of how our strategy is going moving forward. Thank you.

Josh Smiley: Thanks for the question. On the financial results and SG&A specifically, I think, you know, if you look at our Q1, I think it's representative of what, you know, you should expect through the year. Obviously, we have, you know, ups and downs as it relates to marketing programs. Our fixed resource base to support the products that we have today and to prepare for launches for the big things coming like COBENFY and Vemurafenib are pretty stable. I think this year, SG&A should be modest, you know, very modest growth versus last year. I think we're happy with where we've started the year from a cost base and from a profitability perspective.

Thank you for watching!

Speaker Change: Thanks for the question on the financial results and SGNA specifically. I think, you know, if you look at our Q1, I think it's representative of what, you know, you should expect through the year. Obviously we have, you know, ups and downs as it relates to marketing programs, but are...

Speaker Change: Our fixed resource base to support the products that we have today and to prepare for launches for the big things coming like Kobempi and Bemrituzemab are pretty stable. So I think this year, S.G.&A should be very modest growth versus last year. And I think we're happy with where we've started the year.

Josh Smiley: As Yajing Chen mentioned, you know, if you look at our adjusted net loss, basically taking out non-cash charges, we were at a $37 million loss. That includes though $20 million of R&D, I mean, upfront payments for the two new assets we brought in in Q1. If you take that out, we're at about a $17 million loss. You know, as we've mentioned, we see sales accelerating through the year. I think as they do on a relatively fixed SG&A base and, you know, R&D, which should be pretty stable as well, we feel quite confident about our ability to achieve profitability this year. SG&A is rightsizing the organization for optimizing the launches and products that we have today.

Speaker Change: from a cost-based and from a profitability perspective, as Yee-Jing mentioned.

Speaker Change: You know, if you look at our adjusted that loss, basically taking out [inaudible]

Speaker Change: Non-cash charges. We were at a $37 million loss. That includes, though, $20 million of R&D. I mean, upfront payments for the two new assets we brought in in Q1. So if you take that out word, about a $17 million loss.

Speaker Change: Say all is accelerating through the year and I think as they do on a relatively fixed S-G-N-A base and

Speaker Change: R&D, which should be pretty stable as well. We feel quite confident about our ability to achieve profitability this year. So, SDNA is right sizing the organization for optimizing the launches and products that we have today. Hey, Anupam.

Josh Smiley: We could have taken a lot of actions in the last few years to try to get to that point. That's why we have a lot of confidence in profitability later this year and, you know, expanding operating margins as we get into the 2026 to 2028 timeframe. Rafael, you can address the second part of the question.

Speaker Change: We've taken a lot of actions in the last few years to try to get to that point, so that's why we have a lot of confidence in profitability later this year and expanding operating margins as we get into the 2026 to 2028 timeframe.

Rafael G. Amado: Yeah. With regards to the TTF, as you correctly said, there will be an oral presentation on the PANOVA-3 study, which is in locally advanced pancreatic cancer. These are inoperable patients that don't have metastatic disease. It was announced that it was positive for overall survival, which is an really important outcome given that this is a very difficult and a med need in that there hasn't been, you know, any intervention that have improved survival in this setting. We plan to file this year with our partner, Novocure. We've started the regulatory discussions in China, we think that we are well on our way to do this.

Rafael Amado: Yeah. With regards to the TTF, as you correctly said, there will be an oral presentation on the PANOVA-3 study, which is in locally advanced pancreatic cancer. These are inoperable patients that don't have metastatic disease. It was announced that it was positive for overall survival, which is an really important outcome given that this is a very difficult and a med need in that there hasn't been, you know, any intervention that have improved survival in this setting. We plan to file this year with our partner, Novocure. We've started the regulatory discussions in China, we think that we are well on our way to do this.

In the name of God, God, God, God, God, God, God, God, God, God

Yes, so with regards to the TTS,

Speaker Change: As you correctly said, there will be an oral presentation on the Panovat-3 study, which is in locally advanced pancreatic cancer. These are inoperable patients that don't have metastatic disease, and it was announced that it was positive for overall survival, which is...

and a really important outcome given that this is a very...

Difficult Anup Mad Knee in that there hasn't been...

Speaker Change: You know, any intervention that has imposed survival in this setting. So, we plan to file this year with our partner Navokir, we started the regulatory discussions in China, and we think that we are on our way to do this.

Rafael G. Amado: With regards to LUNAR, we've deprioritized this given the fact that, you know, PANOVA-3 is really an important indication for us. I think together with gastric cancer, as well as GIST, it really positions us well in the GI setting in China with really transformational products. I think this is, you know, this is really our plan this year. You know, we're working very well with Novocure to ensure that the submission can go into this year.

Rafael Amado: With regards to LUNAR, we've deprioritized this given the fact that, you know, PANOVA-3 is really an important indication for us. I think together with gastric cancer, as well as GIST, it really positions us well in the GI setting in China with really transformational products. I think this is, you know, this is really our plan this year. You know, we're working very well with Novocure to ensure that the submission can go into this year.

Indication for us, and I think together with gastric cancer, [inaudible]

Speaker Change: as well as just the really positions as well in the GI setting in China with really transformational products. So, I think this is, you know, this is really...

Speaker Change: Our plan this year, and we're working very well with Nova Kier to ensure that this submission can go into this year.

Jack Lin: Understood. Thank you both.

Operator: Thank you for the question. Our next question comes from Rebecca Liang from Bernstein. Please go ahead.

Anishin, thank you for work.

In the name of God, God, God, God, God, God, God, God, God

Speaker Change: Thank you for the question, Mr. Du. Our next question is from Rebecca Leung from Bernstein. Please go ahead.

Rebecca Liang: Hi, thank you for taking my question. My first question is on R&D. It seems that you've highlighted quite a few in-house developed assets. Are you shifting the strategy from in more in-licensing to more of in-house focus? If so, are we expecting to see more in-house developed assets to enter into the clinical phase in the coming years? If so, could you provide some guidance as to the pace of such assets? My second question is on the topic of the FDA changes recently. There's been a new appointment of CDR head as well as the job cuts from FDA. How do you expect these to impact on the approval process, for example, the upcoming talks regarding DLL3 and the whole accelerated fact that you mentioned? Thank you.

Rebecca Leung: Thank you for taking my question. My first question is on R&D so it seems that you've highlighted quite a few in-house developed assets.

Rebecca Leung: Are you shifting the strategy from more in-licensing to more of in-house focus?

Rebecca Leung: And if so, are we expecting to see more in-house belt assets to enter into the clinical phase in the coming years? And if so, could you provide some guidance as to the pace of such assets?

Rebecca Leung: And my second question is on the topic of the FDA changes recently. There's been a new appointment in the three year ahead, as well as the job cuts from FDA.

Rebecca Leung: So how do you expect these to impact on the approval process, for example, the upcoming talks regarding DRL 3 and the whole accelerated fact that you mentioned? Thank you.

Josh Smiley: Thanks for the question. It's Josh. At first, I think we're really excited about the progress of the internal pipeline, so we'll give Rafael a chance to talk about that. I think, you know, you should expect us to continue to be balanced as we move forward, looking at both, really good internal assets as well as opportunities to bring in best-in-class products for both the globe and for China, you know, over the coming years. I think with that introduction, Rafael, why don't you talk a little bit about the internal pipeline and then the FDA question?

Thank you for watching!

Rebecca Leung: Thanks for the question, it's Josh. At first, I think we're really excited about the progress of the internal pipeline, so we'll give Rafael a chance to talk about that. I think, you know, you just expect us to continue to be balanced as we move forward, looking at both...

Rebecca Leung: really good internal assets as well as opportunities to bring in best-in-class products for both the globe and for China, you know, over the coming years. But I think with that introduction, Rafael wanted to talk a little bit about the internal pipeline and then the FDA question.

Rafael G. Amado: Yeah. With regards to the new agents that we will bring forward in development, I think it'll be a blend of internal discovered products as well as BD products. It will match our strategy. For instance, in oncology, we will focus on ADCs and in immuno-oncology with improved checkpoint inhibitors as well as, you know, in the future, T-cell engagers. You know, relatively sort of confined area where we have these agents already made or in development. We will utilize them. Where we find high-quality products, we will utilize our, you know, our BD capabilities to do this.

Rafael Amado: Yeah. With regards to the new agents that we will bring forward in development, I think it'll be a blend of internal discovered products as well as BD products. It will match our strategy. For instance, in oncology, we will focus on ADCs and in immuno-oncology with improved checkpoint inhibitors as well as, you know, in the future, T-cell engagers. You know, relatively sort of confined area where we have these agents already made or in development. We will utilize them. Where we find high-quality products, we will utilize our, you know, our BD capabilities to do this.

Thank you for watching!

In the name of God, God, God, God, God, God, God, God, God, God

Speaker Change: Yes, so with regards to the new agents that we will bring forward in development, I think it will be a blend of internally discovered products as well as B.D. products, and it will match our strategy. So, for instance, in oncology, we will focus on ADCs and...

and in immunoncology with improved checkpoint inhibitors as well as...

in the future diesel-engagers.

Speaker Change: or in development, we will utilize them and we will find high quality products.

Rafael G. Amado: As I said, our goal is to have 1 IND, whether it's internally sourced or externally sourced, every year. You know, this year we plan to have 2, ZL-6201 and ZL-1503, which is IL-13/IL-31 for atopic dermatitis. It just so happened that these 2 are internally discovered, but that doesn't necessarily mean that will be the exclusive pattern going forward. With regards to FDA, I made some comments before about the experience that we've had so far, and of course, it's early, as FDA begins to reshape itself with new leaders coming in. Again, we deal with CDER where we yet have to see the appointment there.

Rafael Amado: As I said, our goal is to have 1 IND, whether it's internally sourced or externally sourced, every year. You know, this year we plan to have 2, ZL-6201 and ZL-1503, which is IL-13/IL-31 for atopic dermatitis. It just so happened that these 2 are internally discovered, but that doesn't necessarily mean that will be the exclusive pattern going forward. With regards to FDA, I made some comments before about the experience that we've had so far, and of course, it's early, as FDA begins to reshape itself with new leaders coming in. Again, we deal with CDER where we yet have to see the appointment there.

Speaker Change: and we will utilize our BD capabilities to do this. So, as I said, our goal is to have one IND, whether it's internal source or external source.

Every year.

Speaker Change: This year, we planned to have two LR-615 or 6-0-1 and 15-0-3, which is IL-13-31 for...

Speaker Change: Itopic dermatitis, and so I just so happen that these two are internally discovered, but that doesn't necessarily mean that there will be the exclusive pattern going forward.

Speaker Change: So with regards to FDA, I made some comments before about the experience that we've had so far and of course is early.

SFTAA begins to reshape itself with...

No leaders coming in.

Speaker Change: Again, we deal with Cedar where we yet have to see the appointment there.

Rafael G. Amado: With CDER, Yeah, there's been some comments about accelerated approvals, but I think the comments were made more in the context of accelerated approvals based on single arms. There's not, that I've heard of, any comments about accelerated approvals in the context of randomized trials. I think, you know, in our case with ZL-1310, you know, that shouldn't be the case since our pathway forward for accelerated approval will be an interim analysis on a randomized study against standard of care. That's all I have to say for now because it's still early in the reshaping of the agency, and we will have to see, you know, how if it does evolve, how it evolves.

Rafael Amado: With CDER, Yeah, there's been some comments about accelerated approvals, but I think the comments were made more in the context of accelerated approvals based on single arms. There's not, that I've heard of, any comments about accelerated approvals in the context of randomized trials. I think, you know, in our case with ZL-1310, you know, that shouldn't be the case since our pathway forward for accelerated approval will be an interim analysis on a randomized study against standard of care. That's all I have to say for now because it's still early in the reshaping of the agency, and we will have to see, you know, how if it does evolve, how it evolves.

We see there. Yeah, there's been some comments about Accelerator Poole Hall.

Speaker Change: But I've seen the comments were made more in the context of Accelerate Approval Space and Single Arms.

Speaker Change: So there's not the rest sort of any, there's not being any comments about Accelerate approval in the context of randomize trials.

Speaker Change: And I think, you know, in our case with 1310, you know, that shouldn't be the case since our pathway forward for

Speaker Change: So that's all I have to say for now because it's still early in the...

We shared them on the agency and we will have to see.

You know, how it does. [inaudible]

Rafael G. Amado: As I said, so far we have seen no changes, with regards to our history of developing drugs, in the past.

Rafael Amado: As I said, so far we have seen no changes, with regards to our history of developing drugs, in the past.

Operator: Thank you for the question.

Rebecca Liang: Thanks, Josh. Very clear.

Thank you for your question. Very clear.

Operator: Our final questions comes from the line once again from Linhai Zhao from Goldman Sachs. Please go ahead.

Speaker Change: Hope I may questions come from the line once again from Linghai Zhao, from Goldman Sachs. Please go ahead.

Linhai Zhao: Hi. Thanks for taking my question. This is Linghai from Goldman. My question is on KarXT particularly regarding the recent top line news on the phase 3 ARISE trial. What would be the read-across for China market? I know that Zai Lab is not participating.

Speaker Change: Hi, thanks for taking my question. This is Ling Hai from Goldman. My question is on CoreXT, particularly regarding the recent top linemies on the Phase 3 Arise trial. What would be the read across for China market? I know that Zai Lab is not participating.

Josh Smiley: Rafael, why don't you go ahead on that?

Rafael G. Amado: Yeah. ARISE was a study where KarXT was used as an adjunctive therapy to standard therapy in schizophrenia. It didn't meet the primary endpoint. With regards to the indication of schizophrenia in China, it really has no impact. Our re-regulatory submission was based on a study that mimicked the emergent studies. It was positive in all endpoints. More than 80% of patients with schizophrenia in China are treated with a single agent. Clearly there are some clear advantages of this product with regards to toxicity over the classical antipsychotics. The patients that require adjuvant therapy are difficult to treat patients. This is not a practice that occurs in China.

Rafael Amado: Yeah. ARISE was a study where KarXT was used as an adjunctive therapy to standard therapy in schizophrenia. It didn't meet the primary endpoint. With regards to the indication of schizophrenia in China, it really has no impact. Our re-regulatory submission was based on a study that mimicked the emergent studies. It was positive in all endpoints. More than 80% of patients with schizophrenia in China are treated with a single agent. Clearly there are some clear advantages of this product with regards to toxicity over the classical antipsychotics. The patients that require adjuvant therapy are difficult to treat patients. This is not a practice that occurs in China.

Rafael, why don't you go ahead on that?

Rafael Amado: Yeah, so Arise was a study where currency was used to turn a junk piece therapy.

Speaker Change: to Standard Therapy in schizophrenia. I didn't meet the primary endpoint, but with regards to the indication of schizophrenia in China, it really has no impact.

Speaker Change: A regulatory submission was based on a study that mimicked the emergent studies and it was positive in all

Speaker Change: More than 80% of patients with schizophrenia and China are treated with...

Clear Ventures of this product with regards to toxicity.

over the classical antiseptotic. So,

Speaker Change: The patients that require adjuvant therapy are difficult to treat patients and this is not a practice that occurs in China.

Rafael G. Amado: No impact with regards to that. Likewise, we see no impact with regards to Adept where obviously those patients were not included in the ARISE study. We're just awaiting the results of Adept 2 in the second half of this year where we participated together with Karuna BMS.

Rafael Amado: No impact with regards to that. Likewise, we see no impact with regards to Adept where obviously those patients were not included in the ARISE study. We're just awaiting the results of Adept 2 in the second half of this year where we participated together with Karuna BMS.

Speaker Change: No impact with regards to that and likewise we see no impact with regards to ADP where obviously those patients were not included in the RIs study and were just awaiting the results of that too in the second half of this year.

where we participated together with Corona VMS.

Linhai Zhao: Great. Thank you. A quick follow-up on that would be, since you mentioned that majority of schizophrenia patients in China are primarily treated with a single agent. If that's the case, what's your perspective based on the communications with the KOLs in China? What would be the potential treatment position for KarXT? Do you see it be used as a initial usage for patients when they were at the initial acute stage or more possibly used as a longer-term maintenance stage while the patients are having better control on the positive symptoms while they are trying to get more prepared when getting back to their normal life?

Speaker Change: Great, thank you. A quick follow-up on that would be a submission that a majority of schizophrenia patients in China are primarily treated with the single agent.

Speaker Change: So, if that's the case, what's your perspective based on the communications with the KOLs in China? What would be the potential treatment position for RxT? Do you see it be used as an initial usage for patients when they were at the initial acute stage or more possibly used as a longer-term maintenance stage while the patients are having better control?

Speaker Change: on the positive symptoms as well. They are trying to get more prepared when getting back to their

Rafael G. Amado: Yeah. I mean, my impression is that this is an agent that will be used de novo in patients with schizophrenia. I think the differences with regards to toxicity are really stark in favor of this drug. It's also a drug that has the potential to be effective in multiple other indications. We will see other indications coming through as BMS develops this drug together, and we will partner with them on other indications. With regards to schizophrenia, we think that this is kind of a, you know, a sort of a quantum leap with regards to the side effects, including tardive dyskinesia and all the metabolic side effects that we're seeing with the classical antipsychotics.

Rafael Amado: Yeah. I mean, my impression is that this is an agent that will be used de novo in patients with schizophrenia. I think the differences with regards to toxicity are really stark in favor of this drug. It's also a drug that has the potential to be effective in multiple other indications. We will see other indications coming through as BMS develops this drug together, and we will partner with them on other indications. With regards to schizophrenia, we think that this is kind of a, you know, a sort of a quantum leap with regards to the side effects, including tardive dyskinesia and all the metabolic side effects that we're seeing with the classical antipsychotics.

Thank you.

Yeah, I mean, my.

Thank you. Bye.

Speaker Change: Impression is this is an agent that will be used the novel in patients with schizophrenia.

Speaker Change: I think the differences with regards to toxicity are really stark in favor of this drug.

Speaker Change: It's also a drug that has the potential to be effective in multiple other indications.

Speaker Change: and so we will see other indications coming to do as PMS develops this drug, and we will.

Speaker Change: Partner with them on other indications. So with regards to schizophrenia, we think that this is kind of a kind of a quantum leap with regards to the side effects. Thank you very much.

Speaker Change: including Dr. Diximinsia and all the metabolic side effects that we're seeing with the classical anti-saccharide. So, our impression is that this will be used at the NOVO. And there's really data that goes now beyond 62 weeks.

Rafael G. Amado: Our impression is that this will be used de novo. There's really data that goes now beyond 62 weeks, you know, showing that this safety profile really is maintained over the long term. Therefore, the logical conclusion is that it should become the treatment of choice.

Rafael Amado: Our impression is that this will be used de novo. There's really data that goes now beyond 62 weeks, you know, showing that this safety profile really is maintained over the long term. Therefore, the logical conclusion is that it should become the treatment of choice.

Speaker Change: showing that this safety profile really gives Ace maintain over the long-term. Therefore, the logical conclusion is that it should become the three-minute choice.

Linhai Zhao: Got it. Thanks for the very comprehensive answers. That concludes my question. Thank you.

Speaker Change: Got it. Thanks for the very comprehensive answers. That concludes my question. Thank you.

Operator: Thank you for the question. There are no more questions on the line. I'd like to hand the call back to management for closing.

Thank you for tuning in. Thank you. Thank you.

Speaker Change: Thank you for the question. There are no more questions on the line I'd like to hand the call back to management for closing.

Samantha Du: Thank you, operator. I want to thank everyone for taking the time to join us on the call today. We appreciate your support. Look forward to updating you again after the Q2 2025. Operator, you may now disconnect this call.

Thank you, operator.

Speaker Change: I want to thank everyone for taking the time to join us on a call today.

Speaker Change: We appreciate your support. Look forward to updating you again after the second quarter of 2025.

Operator: That concludes today's conference call. Thank you all for participating. You may now disconnect the lines.

Up with her, you may now disconnect this call.

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