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GLOBAL OFFERING
Joint Sponsors, Overall Coordinators, Joint Global Coordinators, Joint Bookrunners and Joint Lead Managers
(in alphabetical order)
(in alphabetical order)
Joint Bookrunners and Joint Lead Managers
Joint Lead Managers
Stock Code : 2561
(incorporated in the Cayman Islands with limited liability)
VISEN Pharmaceuticals


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If you are in any doubt about any of the contents of this document, you should obtain independent professional advice.
VISEN Pharmaceuticals
ၪ؁ᖹุ
(incorporated in the Cayman Islands with limited liability)
GLOBAL OFFERING
Number of Offer Shares under the
Global Offering
9,900,000 Shares (subject to the Offer
Size Adjustment Option and the
Over-allotment Option)
Number of Hong Kong Offer Shares 990,000 Shares (subject to reallocation
and the Offer Size Adjustment Option)
Number of International Offer Shares 8,910,000 Shares (subject to reallocation,
the Offer Size Adjustment Option and
the Over-allotment Option)
Maximum Offer Price HK$75.28 per Offer Share, plus
brokerage of 1%, SFC transaction levy
of 0.0027%, Stock Exchange trading
fee of 0.00565% and AFRC
transaction levy of 0.00015% (payable
in full on application in Hong Kong
dollars, subject to refund)
Nominal Value US$0.0001 per Share
Stock Code 2561
Joint Sponsors, Overall Coordinators, Joint Global Coordinators, Joint Bookrunners and
Joint Lead Managers
MORGAN STANLEY JEFFERIES
Joint Bookrunners and Joint Lead Managers
(in alphabetical order)
CLSA FUTU GUOYUAN SOOCHOW
Joint Lead Managers
(in alphabetical order)
PA TRONS RUIBANG
Hong Kong Exchanges and Clearing Limited, The Stock Exchange of Hong Kong Limited and Hong Kong Securities Clearing Company Limited take no responsib ility for the contents of this
document, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising f rom or in reliance upon the whole or any part
of the contents of this document.
A copy of this document, having attached thereto the documents specified in “Documents delivered to the Registrar of Companies in Hong Kong and on Disp lay” in Appendix V , has been registered
by the Registrar of Companies in Hong Kong as required by Section 342C of the Companies (Winding Up and Miscellaneous Provisions) Ordinance (Chapter 3 2 of the Laws of Hong Kong). The
Securities and Futures Commission and the Registrar of Companies in Hong Kong take no responsibility for the contents of this document or any other doc ument referred to above.
The Offer Price is expected to be determined by agreement between the Overall Coordinators (for themselves and on behalf of the Underwriters) and the C ompany on the Price Determination Date.
The Price Determination Date is expected to be on or before Wednesday, March 19, 2025 (Hong Kong time) and, in any event, not later than 12:00 noon on Wedn esday, March 19, 2025 (Hong Kong
time). The Offer Price will not be more than HK$75.28 per Offer Share and is currently expected to be not less than HK$68.44 per Offer Share. If, for any re ason, the Offer Price is not agreed on
or before 12:00 noon on Wednesday, March 19, 2025 (Hong Kong time) between the Overall Coordinators (for themselves and on behalf of the Underwriters) and the Company, the Global Offering
will not proceed and will lapse. The Overall Coordinators, on behalf of the Underwriters, may, where considered appropriate and with the Company’s co nsent, reduce the number of Hong Kong Offer
Shares and/or the indicative Offer Price range below that is stated in this prospectus (which is HK$68.44 to HK$75.28) at any time on or prior to the morn ing of the last day for lodging applications
under the Hong Kong Public Offering. In such case, an announcement will be published on the website of our Company at www.visenpharma.com and on the website of the Hong Kong Stock
Exchange at www.hkexnews.hk and the offer will be canceled and relaunched at the revised number of Offer Shares and/or the revised Offer Price range and the requirements under Rule 11.13 of
the Listing Rules (which include the issue of a supplemental prospectus or a new prospectus (as appropriate)), as soon as practicable following the de cision to make such reduction, and in any event
not later than the morning of the last day for lodging applications under the Hong Kong Public Offering. Further details are set forth in the sections he aded “Structure of the Global Offering” and
“How to Apply for Hong Kong Offer Shares” in this prospectus.
The obligations of the Hong Kong Underwriters under the Hong Kong Underwriting Agreement are subject to termination by the Joint Global Coordinators and the Overall Coordinators (for
themselves and on behalf of the Hong Kong Underwriters) if certain grounds arise prior to 8:00 a.m. on the Listing Date. See “Underwriting – Underwriti ng Arrangements and Expenses – Hong
Kong Public Offering – Grounds for termination” for further details.
Prior to making an investment decision, prospective investors should consider carefully all of the information set out in this document, including t he risk factors set out in the section headed “Risk
Factors.”
The Offer Shares have not been and will not be registered under the U.S. Securities Act or any state securities laws of the United States and may not be off ered or sold within or to the United States,
or for the account or benefit of U.S. persons (as defined in Regulation S) except in transactions exempt from, or not subject to, the registration requi rements of the U.S. Securities Act. The Offer
Shares are being offered and sold (i) solely to QIBs pursuant to an exemption from registration under Rule 144A and (ii) outside the United States in off shore transactions in accordance with
Regulation S.
A TTENTION
We have adopted a fully electronic application process for the Hong Kong Public Offering. We will not provide printed copies of this document to the pub lic in relation to the Hong Kong Public
Offering.
This document is available at the websites of the Stock Exchange (www.hkexnews.hk) and our Company (http://www.visenpharma.com). If you require a p rinted copy of this document, you may
download and print from the website addresses above.
IMPORTANT
March 13, 2025


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IMPORTANT NOTICE TO INVESTORS:
FULLY ELECTRONIC APPLICATION PROCESS
We have adopted a fully electronic application process for the Hong Kong
Public Offering. We will not provide printed copies of this document to the public
in relation to the Hong Kong Public Offering.
This document is available at the website of the Stock Exchange at
www.hkexnews.hk under the “ HKEXnews > New Listings > New Listing
Information ” section, and our website at www.visenpharma.com. If you require a
printed copy of this document, you may download and print from the website
addresses above.
To apply for the Hong Kong Offer Shares, you may:
(a) apply online through the White Form eIPO service through the designated
website at http://www.eipo.com.hk ;
(b) apply electronically through the HKSCC EIPO channel and cause HKSCC
Nominees to apply on your behalf by instructing your broker or custodian
who is a HKSCC Participant to give electronic application instructions via
HKSCC’s FINI system to apply for the Hong Kong Offer Shares on your
behalf.
We will not provide any physical channels to accept any application for the Hong
Kong Offer Shares by the public. The contents of the electronic version of this document
are identical to the printed prospectus as registered with the Registrar of Companies in
Hong Kong pursuant to Section 342C of the Companies (Winding Up and Miscellaneous
Provisions) Ordinance (Chapter 32 of the laws of Hong Kong).
If you are an intermediary , broker or agent , please remind your customers, clients
or principals, as applicable, that this document is available online at the website
addresses above.
Please refer to the section headed “How to Apply for Hong Kong Offer Shares” in
this document for further details of the procedures through which you can apply for the
Hong Kong Offer Shares electronically.
IMPORTANT
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Y our application through the White Form eIPO service or by giving electronic
application instructions to HKSCC must be for a minimum of 100 Hong Kong Offer
Shares and in one of the numbers set out in the table.
If you are applying through the White Form eIPO service, you may refer to the
table below for the amount payable for the number of Shares you have selected. Y ou
must pay the respective amount payable on application in full upon application for Hong
Kong Offer Shares.
If you are applying through the HKSCC EIPO channel, you are required to
pre-fund your application based on the amount specified by your broker or custodian ,
as determined based on the applicable laws and regulations in Hong Kong. Y ou are
responsible for complying with any such pre-funding requirement imposed by your
broker or custodian with respect to the Hong Kong Offer Shares you applied for.
VISEN Pharmaceuticals (Stock Code 2561)
(HK$75.28 per Hong Kong Offer Share)
NUMBER OF HONG KONG OFFER SHARES THAT MAY BE APPLIED FOR AND PAYMENTS
No. of
Hong Kong
Offer Shares
applied for
Maximum
Amount
payable (2) on
application
No. of
Hong Kong
Offer Shares
applied for
Maximum
Amount
payable (2) on
application
No. of
Hong Kong
Offer Shares
applied for
Maximum
Amount
payable (2) on
application
No. of
Hong Kong
Offer Shares
applied for
Maximum
Amount
payable (2) on
application
HK$ HK$ HK$ HK$
100 7,603.92 1,500 114,058.80 8,000 608,313.59 90,000 6,843,527.89
200 15,207.84 2,000 152,078.41 9,000 684,352.79 100,000 7,603,919.88
300 22,811.76 2,500 190,097.99 10,000 760,391.99 150,000 11,405,879.82
400 30,415.68 3,000 228,117.60 20,000 1,520,783.98 200,000 15,207,839.75
500 38,019.61 3,500 266,137.20 30,000 2,281,175.97 250,000 19,009,799.70
600 45,623.52 4,000 304,156.79 40,000 3,041,567.95 300,000 22,811,759.65
700 53,227.44 4,500 342,176.40 50,000 3,801,959.95 350,000 26,613,719.58
800 60,831.36 5,000 380,195.99 60,000 4,562,351.93 400,000 30,415,679.52
900 68,435.28 6,000 456,235.20 70,000 5,322,743.91 450,000 34,217,639.45
1,000 76,039.19 7,000 532,274.39 80,000 6,083,135.90 495,000
(1) 37,639,403.41
(1) Maximum number of Hong Kong Offer Share you may apply for, and this is 50% of the Hong Kong
Offer Shares initially offered.
(2) The amount payable is inclusive of brokerage, SFC transaction levy, the Stock Exchange trading fee
and AFRC transaction levy. If your application is successful, brokerage will be paid to the Exchange
Participants (as defined in the Listing Rules) and the SFC transaction levy, the Stock Exchange trading
fee and AFRC transaction levy are paid to the Stock Exchange (in the case of the SFC transaction levy,
collected by the Stock Exchange on behalf of the SFC; and in the case of the AFRC transaction levy,
collected by the Stock Exchange on behalf of the AFRC).
No application for any other number of Hong Kong Offer Shares will be considered
and any such application is liable to be rejected.
IMPORTANT
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If there is any change in the following expected timetable of the Hong Kong Public
Offering, our Company will issue an announcement to be published on the websites of the
Stock Exchange at www.hkexnews.hk and our Company at www.visenpharma.com .
Date (1)
Hong Kong Public Offering commences ...................... .9:00 a.m. on Thursday,
March 13, 2025
Latest time for completing electronic applications under the
White Form eIPO service through the
designated website www.eipo.com.hk (2) ..................... 1 1:30 a.m. on Tuesday,
March 18, 2025
Application lists of the Hong Kong Public Offering open (3) ........ 1 1:45 a.m. on Tuesday,
March 18, 2025
Latest time for (a) completing payment of White Form eIPO
applications by effecting internet banking transfer(s) or
PPS payment transfer(s) and (b) giving electronic
application instructions to HKSCC
(4) .................... .12:00 noon on Tuesday,
March 18, 2025
If you are instructing your broker or custodian who is a HKSCC Participant to give
electronic application instructions via HKSCC’ s FINI system to apply for the Public Offer
Shares on your behalf, you are advised to contact your broker or custodian for the latest time
for giving such instructions which may be different from the latest time as stated above.
Application lists of the Hong Kong Public Offering close (3) ...... .12:00 noon on Tuesday,
March 18, 2025
Expected Price Determination Date (5) .................................W ednesday,
March 19, 2025
Announcement of the final Offer Price, the level of
indications of interest in the International Offering,
the level of applications in the Hong Kong Public Offering
and the basis of allocation of the Hong Kong Offer Shares
to be published on the websites of the Stock Exchange at
www.hkexnews.hk and our Company at www.visenpharma.com
(7)
on or before .................................................... Thursday,
March 20, 2025
EXPECTED TIMETABLE (1)
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Results of allocations in the Hong Kong Public Offering (with successful applicants’
identification document numbers, where applicable) to be available through a variety of
channels, including:
 in the announcement to be posted on
the websites of the Stock Exchange
at www.hkexnews.hk and our Company
at www.visenpharma.com , respectively ...............n o later than 11:00 p.m. on
Thursday,
March 20, 2025
 from the designated results of allocations
website at www.iporesults.com.hk
(alternatively: www.eipo.com.hk/eIPOAllotment )
with a “search by ID” function from ............................ 1 1:00 p.m. on
Thursday,
March 20, 2025
to 12:00 midnight on
Wednesday,
March 26, 2025
 from the allocation results telephone
enquiry line by calling +852 2862 8555
between 9:00 a.m. and 6:00 p.m. on ................................. Friday,
March 21, 2025,
Monday, March 24, 2025,
Tuesday, March 25, 2025 and
Wednesday, March 26, 2025
Share certificates in respect of wholly or partially successful
applications pursuant to the Hong Kong Public Offering
to be dispatched or deposited into CCASS on or before
(8)(10) ............... Thursday,
March 20, 2025
White Form e-Refund payment instructions/refund
checks in respect of (i) wholly or partially successful applications
(if applicable) and (ii) wholly or partially unsuccessful
applications pursuant to the Hong Kong Public Offering
to be despatched on or before
(9)(10) .................................... Friday,
March 21, 2025
Dealings in the Shares on the Stock Exchange expected
to commence .......................................... a t 9:00 a.m. on Friday,
March 21, 2025
EXPECTED TIMETABLE (1)
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(1) All times and dates refer to Hong Kong local times and dates, except as otherwise stated.
(2) Y ou will not be permitted to submit your application under the White Form eIPO service through the
designated website at www.eipo.com.hk after 11:30 a.m. on the last day for lodging applications. If you have
already submitted your application and obtained an application reference number from the designated website
prior to 11:30 a.m., you will be permitted to continue the application process (by completing payment of
application monies) until 12:00 noon on the last day for lodging applications, when the application lists close.
(3) If there is/are a “black” rainstorm warning signal, a tropical cyclone warning signal number eight or above
and/or Extreme Conditions in force in Hong Kong at any time between 9:00 a.m. and 12:00 noon on Tuesday,
March 18, 2025, the application lists will not open or close on that day. See the section headed “How to Apply
for Hong Kong Offer Shares – E. Severe Weather Arrangements” in this prospectus.
(4) Applicants who apply for the Hong Kong Offer Shares by instructing your broker or custodian to give
electronic application instructions to HKSCC on your behalf via FINI should refer to the section headed “How
to Apply for Hong Kong Offer Shares – A. Application for Hong Kong Offer Shares – 2. Application Channels”
in this prospectus.
(5) The Price Determination Date is expected to be on or before Wednesday, March 19, 2025. If, for any reason,
the Offer Price is not agreed on or before 12:00 noon on Wednesday, March 19, 2025 the Global Offering will
not proceed and will lapse.
(6) To be announced as soon as practicable after the Price Determination Date but before the allotment result
announcement.
(7) None of the websites or any of the information contained on the websites forms part of this prospectus.
(8) Share certificates for the Hong Kong Offer Shares are expected to be issued on Thursday, March 20, 2025 but
will only become valid evidence of title provided that (i) the Global Offering has become unconditional in all
respects, and neither of the Underwriting Agreements has been terminated in accordance with its terms, prior
to 8:00 a.m. on the Listing Date, which is expected to be on or around Friday, March 21, 2025. Investors who
trade Shares on the basis of publicly available allocation details before the receipt of share certificates or
before the share certificates becoming valid certificates of title do so entirely at their own risk, (ii) the right
of termination as described in the paragraph headed “Grounds for Termination” under the section headed
“Underwriting” in this prospectus has not been exercised and has lapsed.
(9) White Form e-Refund payment instruction or refund checks will be issued in respect of wholly or partially
unsuccessful applications pursuant to the Hong Kong Public Offering. Part of the applicant’s Hong Kong
identity card number or passport number, or, if the application is made by joint applicants, part of the Hong
Kong identity card number or passport number of the first-named applicant, provided by the applicant(s) may
be printed on the refund check, if any. Such data would also be transferred to a third party for refund purpose.
Banks may require verification of an applicant’s Hong Kong identity card number or passport number before
cashing the refund check. Inaccurate completion of an applicant’s Hong Kong identity card number or passport
number may lead to delay in encashment of or may invalidate the refund check. Further information is set out
in the section headed “How to Apply for Hong Kong Offer Shares” in this prospectus.
(10) Applicants who apply via HKSCC EIPO channel should refer to the paragraphs headed “How to Apply for
Hong Kong Offer Shares – D. Despatch/Collection of Share Certificates and Refund of Application Monies”
in this prospectus for details. Applicants who have applied through the White Form eIPO service by paying
the application monies through single bank accounts may have refund monies (if any) despatched to the bank
account in the form of White Form e-Refund payment instructions. Applicants who apply via the White Form
eIPO service by paying the application monies through multiple bank accounts may have refund monies (if
any) despatched to the address as specified in their application instructions in the form of refund checks by
ordinary post and at their own risk.
Share certificates and/or refund checks will be dispatched by ordinary post, at the applicants’ risk, to the
addresses specified in the relevant applications.
Further information is set out in the paragraphs headed “How to Apply for Hong Kong Offer Shares – D.
Despatch/Collection of Share Certificates and Refund of Application Monies.”
EXPECTED TIMETABLE (1)
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The above expected timetable is a summary only. Y ou should refer to the sections headed
“Structure of the Global Offering” and “How to Apply for Hong Kong Offer Shares” in this
prospectus for details of the structure of the Global Offering, including the conditions of the
Global Offering, and the procedures for application for the Hong Kong Offer Shares.
If the Global Offering does not become unconditional or is terminated in accordance with
its terms, the Global Offering will not proceed. In such case, the Company will make an
announcement as soon as practicable thereafter.
You should read carefully “Underwriting,” “Structure of the Global Offering” and “How
to Apply for Hong Kong Offer Shares” for details relating to the structure of the Global
Offering, procedures on the applications for Hong Kong Offer Shares and the expected
timetable, including conditions, effect of bad weather and/or Extreme Conditions and the
despatch of refund monies and Share certificates.
EXPECTED TIMETABLE (1)
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IMPORTANT NOTICE TO INVESTORS
This document is issued by us solely in connection with the Hong Kong Public
Offering and the Hong Kong Offer Shares and does not constitute an offer to sell or a
solicitation of an offer to buy any security other than the Hong Kong Offer Shares offered
by this document pursuant to the Hong Kong Public Offering. This document may not be
used for the purpose of making, and does not constitute, an offer or invitation in any other
jurisdiction or in any other circumstance. No action has been taken to permit a public
offering of the Hong Kong Offer Shares in any jurisdiction other than Hong Kong and no
action has been taken to permit the distribution of this document in any jurisdiction other
than Hong Kong. The distribution of this document for purposes of a public offering and
the offering and sale of the Hong Kong Offer Shares in other jurisdictions are subject to
restrictions and may not be made except as permitted under the applicable securities laws
of such jurisdictions and pursuant to registration with or authorization by the relevant
securities regulatory authorities or an exemption therefrom.
You should rely only on the information contained in this document to make your
investment decision. The Hong Kong Public Offering is made solely on the basis of the
information contained and the representations made in this document. We have not
authorized anyone to provide you with information that is different from what is
contained in this document. Any information or representations not contained or made in
this document must not be relied on by you as having been authorized by us, the Joint
Sponsors, the Joint Global Coordinators, the Overall Coordinators, the Joint
Bookrunners, the Joint Lead Managers, any of the Underwriters, any of our or their
respective directors, officers, employees, agents or representatives, or any other parties
involved in the Global Offering.
Page
EXPECTED TIMETABLE ............................................. i i i
CONTENTS ........................................................ v i i
SUMMARY ........................................................ 1
DEFINITIONS ...................................................... 3 3
GLOSSARY OF TECHNICAL TERMS ................................... 4 7
FORW ARD-LOOKING STA TEMENTS ................................... 5 6
RISK FACTORS .................................................... 5 8
W AIVERS AND EXEMPTION ......................................... 1 2 8
INFORMA TION ABOUT THIS PROSPECTUS AND THE GLOBAL OFFERING . . . 136
CONTENTS
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DIRECTORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING ........ 1 4 1
CORPORA TE INFORMA TION ......................................... 1 4 7
INDUSTRY OVERVIEW .............................................. 1 4 9
REGULA TORY ENVIRONMENT ....................................... 1 8 4
HISTORY , DEVELOPMENT AND CORPORA TE STRUCTURE ................ 2 1 8
BUSINESS ........................................................ 2 3 9
RELA TIONSHIP WITH THE CONTROLLING SHAREHOLDERS .............. 3 6 8
CONNECTED TRANSACTIONS ....................................... 3 8 1
DIRECTORS AND SENIOR MANAGEMENT ............................. 4 0 0
SUBSTANTIAL SHAREHOLDERS ...................................... 4 1 7
SHARE CAPITAL ................................................... 4 1 9
FINANCIAL INFORMA TION .......................................... 4 2 4
CORNERSTONE INVESTORS ......................................... 4 6 0
FUTURE PLANS AND USE OF PROCEEDS .............................. 4 6 9
UNDERWRITING ................................................... 4 7 3
STRUCTURE OF THE GLOBAL OFFERING .............................. 4 8 8
HOW TO APPL Y FOR HONG KONG OFFER SHARES ...................... 5 0 6
APPENDIX I – ACCOUNTANTS’ REPORT .......................... I - 1
APPENDIX IIA – UNAUDITED PRO FORMA FINANCIAL INFORMA TION . . IIA-1
APPENDIX IIB – UNAUDITED PRELIMINARY FINANCIAL
INFORMA TION FOR THE YEAR ENDED
DECEMBER 31, 2024 ............................ IIB-1
APPENDIX III – SUMMARY OF THE CONSTITUTION OF OUR COMPANY
AND CAYMAN ISLANDS COMPANY LAW ........... III-1
APPENDIX IV – STA TUTORY AND GENERAL INFORMA TION .......... I V - 1
APPENDIX V – DOCUMENTS DELIVERED TO THE REGISTRAR OF
COMPANIES IN HONG KONG AND ON DISPLAY ..... V - 1
CONTENTS
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This summary aims to give you an overview of the information contained in this
document. As this is a summary, it does not contain all the information that may be
important to you. Moreover , there are risks associated with any investment. Some of the
particular risks in investing in the Offer Shares are set out in the section headed “Risk
Factors.” In particular , we are a biopharmaceutical company seeking to list on the Main
Board of the Stock Exchange under Chapter 18A of the Listing Rules on the basis that we
are unable to meet the requirements under Rule 8.05(1), (2) or (3) of the Listing Rules.
You should read the entire document carefully before you decide to invest in the Offer
Shares.
OVERVIEW
Founded in November 2018, we are a late-stage, near-commercialization
biopharmaceutical company focused on providing treatments in selected endocrinology
diseases in China (including Hong Kong, Macau and Taiwan). We have one Core Product and
two other pipeline drug candidates, all of which were in-licensed from our collaboration
partner and one of the Controlling Shareholders, Ascendis Pharma. See “Business –
Collaborations” for more details. Since our inception until the date of this document, we have
been conducting further research and development of such drug candidates.
Our Core Product, lonapegsomatropin, is a once-weekly long-acting growth hormone
replacement therapy for the treatment of pediatric growth hormone deficiency (“PGHD”), a
common short stature in patients aged under 18 caused by insufficient growth hormone.
TransCon CNP (navepegritide), one of our key drug candidates, is a long-acting prodrug of
c-type natriuretic peptide for the treatment of achondroplasia (“ACH”), a short-limbed
dwarfism which results in severe skeletal complications and comorbidities.
Palopegteriparatide, the other key drug candidate, is a once-daily parathyroid hormone
(“PTH”) replacement therapy for the treatment of chronic hypoparathyroidism (“HP”), a
syndrome of abnormal calcium and phosphorus metabolism caused by decreased secretion or
defective function of PTH.
WE MAY NOT BE ABLE TO DEVELOP AND/OR MARKET OUR CORE PRODUCT
SUCCESSFULLY.
SUMMARY
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Our Drug Pipeline
Leveraging our clinical development capabilities, we provide patients in China (including
Hong Kong, Macau and Taiwan) with access to the following endocrine solutions: (i) our Core
Product, lonapegsomatropin, has completed the Phase 3 pivotal trial in China for the treatment
of PGHD; the BLA filing was made on January 18, 2024 and subsequently accepted by the
NMPA on March 7, 2024; (ii) TransCon CNP (navepegritide) has completed the double-blind
period of Phase 2 clinical trial in China for the treatment of ACH and the last patient last visit
of open-label extension (“OLE”) period of this trial was completed in April 2024; and (iii)
palopegteriparatide is currently undergoing development in a Phase 3 pivotal trial in China; it
has completed the double-blind period in January 2023, and the expected NDA filing to the
NMPA will be in 2025. Below is a pipeline diagram setting forth our drug candidates:
Drug Candidate* Indication
Clinical Development and Regulatory Status
IND Phase 1 Phase 2 Phase 3 BLA / NDA
Upcoming
Milestones of
Trials Conducted
by VISEN
Pediatric Endocrinology
Adult
Endocrinology
Expected BLA
approval date
in the second half
of 2025
Pediatric
Growth
Hormone
Deficiency
Lonapegsomatropin Completed China Phase 3 pivotal trial in April 2022
(BLA accepted by the NMPA in March 2024)(1)
Hypoparathyroidism
Expected NDA
submission
to the NMPA
in 2025
Palopegteriparatide+ Ongoing China Phase 3 pivotal trial,
double-blind period(4) completed in January 2023(3)
Core Product Key drug candidates+ +
Achondroplasia
Expected NDA
submission to
the NMPA
TransCon CNP
(navepegritide)+ Ongoing China Phase 2 trial, double-blind period(4) completed in
November 2023(2)
* VISEN has gained exclusive licensed rights to develop, manufacture and commercialize all drug candidates in
endocrinology in China (including Hong Kong, Macau and Taiwan).
Notes:
(1) VISEN completed the Phase 3 pivotal trial of lonapegsomatropin in China for the treatment of PGHD in April
2022 which met its primary endpoint according to our published results. We made the BLA filing with the
NMPA on January 18, 2024 for our Core Product for the treatment of PGHD, which was subsequently accepted
by the NMPA on March 7, 2024.
(2) The primary analysis of the double-blind period of the Phase 2 clinical trials of TransCon CNP (navepegritide)
in China for the treatment of ACH was completed in November 2023, with primary endpoint met according
to the topline results. We became the sole sponsor for the OLE period of this trial in January 2023 and the last
patient last visit of the OLE period was completed in April 2024.
(3) VISEN completed the primary analysis of the Phase 3 pivotal trial of palopegteriparatide in China for the
treatment of adult HP in January 2023 which met its primary efficacy and key secondary endpoints according
to its topline data.
(4) Double-blind means a phase in clinical trial where neither the patients nor the researchers know who is
receiving a placebo and who is getting the treatment in which the objective is primarily to prevent bias and
ensure the validity of the results. OLE means a type of clinical study that typically follows a double-blind
randomized placebo controlled trial of a new drug in which the objective is primarily to gather information
about safety and tolerability of the new drug in long-term, day to day use.
SUMMARY
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Our Core Product - Lonapegsomatropin
Lonapegsomatropin is a drug candidate studied by us to treat children aged 3 to 17 years
old with GHD in a completed Phase 3 pivotal trial in China, where each subject received
treatment for 52 weeks. Lonapegsomatropin demonstrated a greater AHV at 52 weeks for
lonapegsomatropin compared to daily human growth hormone (“hGH”), with statistical
significance. We in-licensed lonapegsomatropin from Ascendis Pharma in November 2018.
Prior to our in-licensing, lonapegsomatropin had been studied by Ascendis Pharma in over 300
children with growth hormone deficiency (“GHD”) across three Phase 3 programs. Leveraging
its novel molecular design, lonapegsomatropin is the only long-acting growth hormone
(“LAGH”) that releases unmodified hGH in vivo consistently in between weekly doses.
Such unmodified hGH is identical in the molecular composition to the endogenous
growth hormone secreted by pituitary gland and preserves its original mode of action,
with direct action by circulating growth hormone on target tissues and indirect action through
promoting insulin-like growth factor-1 (“IGF-1”) production in the liver (via growth hormone
receptor). In contrast, modified hGH often substantially alters its molecular size, which
changes its receptor binding affinity and its ability to reach the target tissue. Our Core Product
provides a convenient once-weekly dosing regimen in injection frequency as compared to
once-daily hGH, which may foster increased dosing compliance for pediatric patients in daily
lives.
We made the BLA filing with the NMPA on January 18, 2024 for our Core Product for
the treatment of PGHD, which was subsequently accepted by the NMPA on March 7, 2024.
Addressable Market and Competitive Landscape
China accounted for the largest share of the global hGH market in 2023, surpassing the
United States and representing 34% of the global market. The hGH market in China was
RMB11.6 billion in 2023 and is expected to grow to RMB28.6 billion by 2030, at a CAGR of
13.7% from 2023 to 2030, according to Frost & Sullivan. The number of patients receiving
hGH therapies largely depends on the number of PGHD patients receiving hGH therapies,
which is calculated by multiplying the prevalence of PGHD by the treatment rate. As PGHD
affects newborn to children as old as 17, the prevalence of PGHD is expected to slightly
decrease from 2023 to 2030. Despite the slightly decreased prevalence, the treatment rate for
PGHD is expected to significantly increase from 5.3% in 2023 to 10.7% in 2030, leading to a
continuous growth in the number of patients receiving hGH therapies.
The hGH market is characterized by intense competition. We are aware of several
pharmaceutical and biopharmaceutical companies that have commenced clinical studies of
products or have successfully commercialized products addressing areas that we are targeting,
including companies marketing or developing LAGH therapies, such as GeneScience
Pharmaceutical Co., Ltd., I-Mab Biopharma Co., Ltd., Xiamen Amoytop Biotech Co., Ltd. and
Anhui Anke Biotechnology (Group) Co., Ltd, Novo Nordisk A/S, as well as companies
marketing daily hGH, such as GeneScience Pharmaceutical Co., Ltd., Anhui Anke
Biotechnology (Group) Co., Ltd and Shanghai United Cell Biotechnology Co., Ltd., and Novo
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Nordisk A/S. Currently in China, only one LAGH therapy has received marketing approval and
several are currently under clinical development. See “Risk Factors – Competition in the
biotechnology and biopharmaceutical industries is intense and our competitors may discover,
develop or commercialize products that are safer, more effective, more effectively marketed or
cost less than ours, or receive regulatory approval or reach the market earlier. If we are unable
to compete effectively, our business, results of operations and prospects will suffer” and
“Industry Overview – Human Growth Hormone” for more details.
TransCon CNP (navepegritide)
TransCon CNP (navepegritide) is a disease-modifying therapy studied by us to treat
children aged 2 to 10 years old with ACH in China, where there is currently no effective
disease-modifying therapy approved. A disease-modifying therapy is a treatment that delays,
slows, or reverses the progression of a disease by targeting its underlying cause. We in-licensed
the TransCon CNP (navepegritide) from Ascendis Pharma in November 2018. Prior to our
in-licensing, TransCon CNP (navepegritide) had been studied by Ascendis Pharma in 45
healthy adult male subjects in a Phase 1 global trial. TransCon CNP (navepegritide) is designed
to optimize efficacy with a safe and convenient once-weekly dose, and is the first ACH therapy
in clinical development in China to date, according to Frost & Sullivan. TransCon CNP
(navepegritide) has completed the double-blind period of Phase 2 clinical trial in China for the
treatment of ACH.
Addressable Market and Competitive Landscape
Due to the absence of approved therapy to treat the genetic basis of ACH, according to
Frost & Sullivan, it is currently unfeasible to determine the market share and market size for
ACH as there have been no corresponding sales generated in China. The prevalence of ACH
in China was 51.2 thousand in 2023 and is estimated to reach 51.9 thousand in 2030.
There is currently no effective disease-modifying therapy for ACH approved in China.
Palopegteriparatide
Palopegteriparatide is a treatment solution studied by us to treat adults with HP . We
in-licensed the palopegteriparatide from Ascendis Pharma in November 2018. Prior to our
in-licensing, palopegteriparatide had been studied by Ascendis Pharma in healthy adult
volunteers in a Phase 1 trial. The current treatments for HP are inadequate due to their limited
therapeutic benefits and the need for chronic administration of calcium in high doses and
increased risks of associated complications. Palopegteriparatide is designed to restore
physiologic levels and activity of PTH throughout 24 hours per day, thereby addressing full
aspects of the disease, including normalizing serum and urinary calcium and serum phosphate
levels. We are studying palopegteriparatide in a China Phase 3 pivotal trial, and have
completed its double-blind period in January 2023.
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Addressable Market and Competitive Landscape
Due to the absence of approved PTH replacement therapy for the treatment of HP in
China, according to Frost & Sullivan, it is currently unfeasible to determine the market share
and market size for HP as there have been no corresponding sales generated in China. The
prevalence of HP in China was 410.1 thousand in 2023 and is estimated to reach 495.6
thousand in 2030.
No PTH replacement therapy has been approved for HP treatment in China.
Palopegteriparatide is the only PTH replacement therapy that has initiated clinical development
in China. As of the Latest Practicable Date, Eneboparatide (developed by Amolyt Pharma) and
CLTX-305 (developed by Calcilytix Therapeutics) are being developed in Phase 3 global
clinical trials; EB612 (developed by Entera Bio), MBX 2109 (developed by MBX Biosciences)
and AMOR-1 (developed by Amorphical) are being developed in Phase 2 global clinical trials;
and EXT608 (developed by Extend Biosciences) is being developed in Phase 1 global clinical
trials. None of these drug candidates have undergone clinical studies in China.
Our Business Model
We have one Core Product and two other pipeline drug candidates, all of which were
in-licensed from our collaboration partner, Ascendis Pharma. Since our inception until the date
of this document, we have been conducting further research and development of such drug
candidates.
Transient conjugation technology. Our drug pipeline is developed based on transient
conjugation technology (TransCon) that enables a prodrug, in which the parent drug is
protected in an inactive form, to release unmodified parent drug in a predictable manner after
distribution into the body and resume physiologic activity. The effectiveness and vast potential
of this transient conjugation technology (TransCon) have been supported by the FDA and EMA
approvals of both lonapegsomatropin for PGHD, the first marketing approvals obtained by a
drug generated from this technology, and palopegteriparatide for hypoparathyroidism in adults.
R&D execution capabilities. Since our inception, our management and internal R&D
teams have carried out extensive R&D activities. In carrying out clinical development
operations, our R&D team reviewed all relevant clinical data generated from the global clinical
trials of the three drug candidates conducted by our collaboration partner, Ascendis Pharma,
and prepared for clinical trial initiations in China. Leveraging strong domain knowledge in the
specific disease epidemiology, disease characteristics, local clinical practice as well as the
current status of the market for the indications targeted by these drug candidates, our R&D
team designed and implemented the study protocol for the clinical trials in China, and has
substantially advanced the clinical development of our three drug candidates. See “Business –
Our Drug Pipeline” and “Business – Research and Development” for more details.
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Commercialization planning. In anticipation of the upcoming commercial launch of our
drug candidates, we started building up a focused and specialized commercialization team with
strong expertise in endocrinology. With respect to specific characteristic of each pipeline drug
and their respective market conditions, we have designed tailor-made programs for
commercialization, patient awareness, and market access. For lonapegsomatropin, we plan to
deploy a pediatric endocrine medical representative team to cover public hospitals, establish
collaborations with an extensive network of private clinics, and offer a comprehensive
service program to cover majority of the potential markets for lonapegsomatropin.For
TransCon CNP (navepegritide), the disease-modifying drug for ACH, we plan to leverage
lonapegsomatropin team for commercial coverage, build up the awareness of ACH and
establish TransCon CNP (navepegritide) as the standard of care for ACH, and participate in the
negotiation of National Reimbursement Drug List of China (“NRDL”) to maximize patient
access. For palopegteriparatide, the PTH replacement therapy for HP , we plan to deploy a
separate adult endocrinology medical representative team, establish HP treatment centers to
cover broad geographic areas and a large patient pool via a “hub-and-spoke” model, engage in
various activities to improve disease awareness, advance diagnosis and treatment for HP , and
participate in the negotiation of NRDL to maximize patient access. Further, we have entered
into a strategic collaboration agreement with Shanghai Pharmaceutical Holding Co., Ltd. ( ɪ
ʮ̡), or Shanghai Pharmaceutical, a wholly-owned subsidiary of Shanghai
Pharmaceutical Holding Co., Ltd. (ʮ̡) (HKEx stock code: 2607),
aiming to establish the necessary management framework in line with the good supply practice
(“GSP”).
Commercial supply and local manufacturing capability . We plan to implement a
three-step plan to source commercial supply for the commercialization of lonapegsomatropin
as early as possible and address the vast domestic market potentials in China (including Hong
Kong, Macau and Taiwan) effectively and secure sustainable drug supply for local patients. In
the short term, we plan to first source the commercial drug supply from our collaboration
partner, Ascendis Pharma. We have successfully reached a commercial supply agreement for
the commercial supply of the Core Product by Ascendis Pharma in October 2023. In the
medium term, we will collaborate with WuXi Biologics (Shanghai) Co., Ltd. (“WuXi
Biologics”), a wholly-owned subsidiary of WuXi Biologics (Cayman) Inc. (ࠢ
ʮ̡) (HKEx stock code: 2269), or the designated local CDMO, to manufacture
lonapegsomatropin for commercial supply in China (including Hong Kong, Macau and
Taiwan). In the long term, we plan to establish our in-house manufacturing capabilities. See
“Business – Commercial Supply and Manufacturing” for more details.
CMC R&D and Local BLA for local manufacturing . According to the Exclusive License
Agreement, we have the contractual right to obtain full knowledge of the Core Product drug
substance manufacturing technology knowhow from Ascendis Pharma. As a step towards local
manufacturing of our Core Product, in July 2023, we entered into a bilateral Technology
Transfer Master Plan of the Core Product with Ascendis Pharma, which has marked the
commencement of the technology transfer (the “Technology Transfer”) with respect to the
manufacturing of the Core Product from Ascendis Pharma to us and sets forth the obligations
of both parties under the Exclusive License Agreement with respect to the Technology Transfer.
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After completion of the Technology Transfer, we will have the full knowledge of the Core
Product drug substance manufacturing technology knowhow to independently collaborate with
WuXi Biologics or any other chosen CDMO in China. Further, in December 2023, we entered
into a bilateral collaboration agreement with WuXi Biologics, pursuant to which WuXi
Biologics will serve as the local CDMO of the Technology Transfer to conduct the process
development and validation achieving the localization of the manufacturing technology
(together with the Technology Transfer, the “Technology Transfer and Localization”).
Completion of the Technology Transfer and Localization, which is expected to be in 2027, will
confer to us the technical capabilities to manufacture the Core Product drug substance in
collaboration with WuXi Biologics. We are also developing the dual chamber device (“DCD”)
technology in the form of prefilled syringe as a drug delivery system for the Core Product drug
substance. Once this development is finished, WuXi Biologics will have the capability to
produce the Core Product. The commercialization of the Core Product manufactured by WuXi
Biologics will start once we obtain the approval of Local BLA, which is expected to occur in
2028. See “Business – Research and Development – CMC Development Programs” for more
details. We expect to procure the Core Product from Ascendis Pharma for the commercial
supply until 2028 following our anticipated commercialization activities in late 2025 after BLA
approval.
OUR STRENGTHS
We believe the following strengths have contributed to our success and differentiated us
from our competitors.
 late-stage pipeline based on validated technology, fast approaching revenue
generation with high degree of certainty;
 lonapegsomatropin as the long-acting hGH replacement therapy for PGHD in China,
the largest and fast-growing hGH market in the world;
 TransCon CNP (navepegritide) as the disease-modifying therapy in China (including
Hong Kong, Macau and Taiwan) for ACH;
 palopegteriparatide as the PTH replacement therapy in China (including Hong
Kong, Macau and Taiwan) addressing the underlying cause of HP;
 strong clinical and regulatory capabilities with proved track-records in developing
our drug candidate pipeline products; and
 world-class management team with deep commercialization expertise and strong
support from Shareholders and investors.
See “Business – Our Strengths” for more details.
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OUR STRATEGIES
To achieve our mission to become a leading biopharmaceutical company in developing
and commercializing endocrine therapies in China (including Hong Kong, Macau and Taiwan),
we intend to pursue the following strategies.
 rapidly advance the regulatory approval of our Core Product and the clinical
development and regulatory approval of other pipeline candidates;
 build commercialization capabilities backed by patient support and market access in
anticipation of the commercial launch of our Core Product and lay the foundation for
commercialization of future drug candidates;
 establish localized manufacturing capabilities to secure the supply of our Core
Product and future potential drug candidates in China (including Hong Kong, Macau
and Taiwan);
 expand the endocrine disease indications covered by our Core Product, two key drug
candidates, and new potential drugs based on transient conjugation technology
(TransCon);
 further expand our pipeline portfolio through strategic in-licensing, collaborations
and partnerships for endocrine therapies looking to enter China (including Hong
Kong, Macau and Taiwan); and
 establish a recognized and leading franchise in endocrinology in China (including
Hong Kong, Macau and Taiwan).
See “Business – Our Strategies” for more details.
RESEARCH AND DEVELOPMENT
R&D Team and Capabilities
We have a strong China-based in-house clinical R&D team led by a seasoned management
team with strong therapeutic area expertise and experience in global biopharmaceutical
development, medical practice and strategic planning. In addition, we have assembled senior
R&D personnel with extensive expertise in clinical development, clinical operation, regulatory
and medical affairs, and chemistry, manufacturing, and controls (“CMC”). Our R&D
capabilities are also supported by our scientific advisory board comprising reputable key
opinion leaders (“KOLs”) in endocrinology and pediatrics.
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Our R&D team has extensive expertise in medical science, regulatory, clinical operation,
quality assurance, pharmacovigilance and data management, statistics, and medical affairs,
enabling us to lead and guide the external contract research organization (“CROs”) and
collaboration partners in a more efficient and effective manner. As of the Latest Practicable
Date, our R&D team consisted of 31 full-time employees, with approximately 45% holding a
Ph.D. or an M.D. degree. We expect to grow our R&D team as we continue our development
activities. Almost all of our R&D team members have in-depth industry knowledge and clinical
development experience in multinational companies. Our R&D team has an average of over 14
years of experience in the clinical development of drugs and/or endocrine therapies and some
of them have extensive expertise in endocrinology and related areas and worked on the clinical
development of other endocrine drugs.
To date, our R&D team has demonstrated a strong capability to optimize study design and
development strategy in China, which has enabled us to advance our drug candidates directly
into pivotal studies, work seamlessly with our collaboration partners, and conduct clinical
execution in an efficient manner. With our insights and expertise in the endocrinology field, we
are able to navigate the research, development, regulatory and commercialization landscape in
China and seek opportunities to maximize the value of each of our pipeline assets and future
endocrine drug candidates.
Clinical Development Programs
We are dedicated to building a pipeline of endocrine therapies in China (including Hong
Kong, Macau and Taiwan). We believe successful clinical development programs covering
preparation, design and execution is critical to our future growth and our ability to remain
competitive in the biopharmaceutical market in China.
Since the in-licensing of our drug candidates from Ascendis Pharma, our senior
management has led an internal clinical R&D team and worked in close collaboration with our
scientific advisory board and industry-leading CROs to carry out R&D activities. Our R&D
team reviewed all relevant clinical data generated from the global clinical trials of the three
drug candidates conducted by Ascendis Pharma and prepared for clinical trial initiations in
China. Leveraging strong domain knowledge in the specific disease epidemiology, disease
characteristics, local clinical practice as well as the current status of the market for the
indications targeted by these drug candidates, our R&D team designed and implemented the
study protocol for the clinical trials in China, and has successfully completed the pivotal Phase
3 trial of lonapegsomatropin for PGHD, the double-blind period of pivotal Phase 3 trial of
palopegteriparatide for adult HP and the double-blind period of Phase 2 trial of TransCon CNP
(navepegritide) for ACH.
The study designs have taken into consideration both: (i) the scientific rationale, such as
mechanism of action (“MoA”), well established pre-clinical data, the most updated global
clinical data, the global study protocol, and local clinical practice; as well as (ii) market
opportunities in China, such as addressable patient population, product positioning and
competitive landscape of each of our drug candidates. Our clinical R&D team organized a
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number of meetings with the KOLs on our scientific board to optimize the study designs for
our drug candidates. In addition, our R&D team engaged in pre-IND communications with the
NMPA, have made multiple IND submissions to the NMPA and have obtained the IND
approval for all of our drug candidates.
Our R&D team manages all key aspects of our trials, oversees clinical development work
and performs the following functions: (i) clinical development strategy; (ii) market assessment
and demand analysis; (iii) trial proposal and protocol design, including study objectives and
primary/secondary endpoints; (iv) clinical site selections, initiations, management and
monitoring; (v) biostatistics, including data management and programming; (vi)
pharmacovigilance; (vii) quality assurance; (viii) investigator and site contracts; (ix) medical
and safety monitoring; (x) clinical data collection and statistical analysis; and (xi) regulatory
submission and communication. In addition, we leverage our external CROs to perform clinical
trials. We implemented a variety of measures to guide our CROs, including comprehensive
planning ahead of trial execution, regular communication and quality check of working
progress, milestone program based on quality assurance check, and a vendor management
system.
CMC Development Programs
See “Business – Research and Development – CMC Development Programs” for more
details.
R&D Expenses
During the Track Record Period, our R&D expenses amounted to RMB179.5 million,
RMB57.7 million and RMB58.9 million in 2022, 2023 and the nine months ended September
30, 2024, respectively, among which, during the respective period, we incurred (i) RMB106.2
million, RMB28.7 million and RMB24.4 million on the development of lonapegsomatropin;
(ii) RMB17.8 million, RMB9.4 million and RMB15.2 million on the development of TransCon
CNP (navepegritide); and (iii) RMB55.5 million, RMB19.6 million and RMB19.3 million on
the development of palopegteriparatide. See “Financial Information – Description of Selected
Components of Statements of Profit or Loss and Other Comprehensive Income – Research and
Development Costs” for details.
During the Track Record Period, we procured R&D consulting services from Ascendis
Pharma mainly for the following activities: (i) for lonapegsomatropin, (a) the
pharmacovigilance and biometry for data analysis including statistical programming and
statistical analysis, and (b) the regulatory strategy advice and documentation support to prepare
for our Import BLA submission package with the NMPA; (ii) for TransCon CNP
(navepegritide) and palopegteriparatide, the pharmacovigilance and biometry for data analysis
including statistical programming and statistical analysis. The amount of R&D consulting
services rendered by Ascendis Pharma relating to our three drug candidates was RMB8.0
million, RMB10.0 million and RMB11.7 million in 2022, 2023 and the nine months ended
September 30, 2024, respectively. In connection with our expected R&D and regulatory
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activities of three drug candidates, we expect to procure R&D consulting services from
Ascendis Pharma mainly for the following activities: (i) for lonapegsomatropin, (a) the
technology transfer of lonapegsomatropin drug substance from Ascendis Pharma to us, and (b)
consulting the technology localization process that involves the lonapegsomatropin drug
substance manufacturing scale-up; (ii) for TransCon CNP (navepegritide) and
palopegteriparatide, the support of data programming and statistical analysis, and the
regulatory strategy advice and documentation support in connection with our expected NDA
with the NMPA. See “Connected Transactions – Non-Exempt and Partially-Exempt Continuing
Connected Transactions – Exclusive License Agreements” for more details.
COMMERCIALIZATION PLAN, PATIENT SUPPORT AND MARKET ACCESS
We are solely responsible for and take full control over the commercialization of our three
drug candidates in China (including Hong Kong, Macau and Taiwan). We build up our in-house
commercialization team in line with the overall R&D and commercialization timeline of our
drug candidate pipeline. In the past few years, we have built up a specialized
commercialization team with strong expertise in endocrinology, to drive medical activities in
the market of China (including Hong Kong, Macau and Taiwan) in accordance with local rules
and regulations. In April 2021, we added Dr. CHEN Jun, Ph.D., as Chief Commercial Officer
to our management team, to enhance our commercialization capabilities. Dr. Chen has over 25
years of experience in the healthcare industry and over 20 years of experience in the
commercialization of endocrine products, including growth hormone. Our product launch team
also includes key leadership members such as medical affairs and marketing head Mr. GU
Qing, who has 18 years of marketing experience in the healthcare industry, and commercial
strategy development head Mr. PAN Haifeng, who has 22 years of experience in the
commercialization of endocrine products. The addition of Dr. Chen, Mr. Gu and Mr. Pan
enabled us to initiate the development of our product launch team including aspects of medical
affairs and commercial strategy development. We believe our key commercialization
leadership members, who have substantial experience and strong track records relevant to our
pipeline drug candidates, can leverage their expertise in launching endocrine drugs in China
(including Hong Kong, Macau and Taiwan).
In anticipation of the potential BLA approval of our Core Product in the second half of
2025 and subsequent commercialization activities later that year, it is expected we will begin
generating cash inflow in the second quarter of 2026. We plan to expand our commercial team
equipped with field sales, regional marketing, medical affairs and customer service functions
starting from 2025. We also plan to build up our commercial infrastructure for
palopegteriparatide and TransCon CNP (navepegritide) based on the respective expected
commercial launch timeline. We believe our internal commercialization team with expanded
talent pool will be sufficient for the purpose of executing our commercialization plan.
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Lonapegsomatropin
Lonapegsomatropin has the potential to capture a significant share in the highly attractive
hGH market in China. China accounted for the largest share of the global hGH market in 2023,
reaching RMB11.6 billion in 2023 at a CAGR of 23.9% from 2018 to 2023. The hGH market
in China is expected to continue its fast growth to reach RMB28.6 billion in 2030, powered by
increasing patient penetration, extending average duration of treatment, and growing
acceptance of LAGH treatment. The hGH market in China is characterized with patient
payment primarily out-of-pocket and sales primarily from private hospitals and clinics,
resulting in hGH product prices being less vulnerable to various price-cutting measures such
as price negotiation in NRDL and price cut in volume-based procurement. The future
competitive landscape of LAGH is expected to be moderate, as there is currently one LAGH
product available and only a handful of products under development. Lonapegsomatropin, with
its profiles in efficacy, safety and convenience, is a promising drug candidate among the
potential competitors.
Our initial focus of commercialization is patients suffering from short stature and
diagnosed with PGHD. The commercial goal for lonapegsomatropin is two-fold: (i) to
accelerate market upgrade from short-acting daily growth hormone to long-acting weekly
growth hormone; and (ii) to establish lonapegsomatropin as the leading LAGH.
To realize our commercial goals, we have devised a competitive and productive
promotional program. The hGH market in China is highly concentrated, with the majority of
PGHD diagnoses being made by pediatric endocrinologists in around 200 top-tier hospitals in
China. To maximize the coverage of our target customer segment, we have identified around
1,000 public hospitals as our target market, including all major children’s hospitals as well as
major Tier 3 hospitals and some Tier 2 hospitals with sizable pediatric departments. We plan
to establish a relatively small but elite commercial team in the first few years after our first
commercial launch to cover the top-tier hospitals and to establish the brand position, followed
by expanding the team to cover most of target market. For hospitals beyond our target market,
we plan to establish external partnerships with distributors and/or contract sales organization
(“CSOs”) to broaden patient accessibility through incremental coverage across China. In
addition to focusing on the target public hospitals that handle the majority of PGHD diagnoses,
we also plan to establish extensive coverage of private hospitals/clinics, which are responsible
for approximately 67% of hGH sales, where drug listing is relatively simple and patients can
have easy access to treatment initiation, prescription refills and quality customer services.
We also plan to deploy a series of programs towards patients undergoing
lonapegsomatropin therapy. These programs include providing a comprehensive patient starter
kit, offering assistance from a professional service team, and developing a digital patient
service platform to enhance patient experience and convenience. The digital patient service
platform includes social media and app that offer features such as injection guidance, FAQs,
refill-services, and virtual classrooms. This platform creates an ecosystem connecting patients,
caregivers and physicians, aiming to improve the treatment experience and optimize
compliance and treatment outcomes. As PGHD patients have higher annual treatment costs and
longer treatment durations compared to many common chronic diseases, we expect such
programs will be productive.
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We expect the pricing of our Core Product to be determined by various factors such as (i)
the competitive landscape of the addressable market at the time of our commercial launch, (ii)
the value propositions of our Core Product including the drug efficacy and safety as well as the
drug administration convenience, (iii) the supply and production costs, and (iv) our pricing
strategies. As the Core Product is currently under the BLA review by the NMPA, we have not
formulated concrete pricing strategy at this stage but we expect that the Core Product will be
priced at a fair premium compared to its competitors in China (including Hong Kong, Macau
and Taiwan), reflecting its value propositions. As the hGH market in China is characterized
with patient payment primarily out-of-pocket and sales primarily from private hospitals and
clinics, we plan to primarily focus on the self-pay market for the commercialization of our Core
Product. We plan to promote our Core Product primarily through our in-house sales and
marketing team through various marketing activities focusing on promoting the clinical
benefits and accessibility of our Core Product. We may also engage contract sales organizations
to promote our Core Product in peripheral cities or regions that are otherwise not covered by
our in-house sales and marketing team. We will collaborate with distributors to establish an
effective distribution network of our Core Product. For this purpose, we have entered into a
strategic collaboration agreement with Shanghai Pharmaceutical aiming to establish the
necessary management framework in line with the GSP .
We plan to provide treatments in selected endocrinology diseases by highlighting four key
product advantages: (i) lonapegsomatropin preserves the natural dual mode MoA of
endogenous growth hormone by releasing unmodified hGH, which includes both a direct effect
at the bone plate and the indirect effect mediated by IGF-1 at the liver. With this advantage,
lonapegsomatropin demonstrated a greater AHV at 52 weeks for lonapegsomatropin compared
to daily hGH, with statistical significance, potentially enabling children with PGHD to achieve
treatment goals more effectively within a limited treatment time window; (ii)
lonapegsomatropin demonstrates key pharmacological profiles, including a molecular structure
of the active drug substance, receptor binding affinity, plasma concentration, tissue
distribution, and a safety profile comparable to daily hGH, which has been utilized by
clinicians for over 30 years with a high level of confidence in its safety. In contrast, the other
LAGHs permanently alter the molecular structure of hGH, resulting in new active drug
molecules that have significantly different pharmacological profiles from the daily hGH and
limited clinical experience; (iii) lonapegsomatropin offers more than 300 injection-free days
per year compared to daily hGH, thus could greatly improve treatment compliance and
treatment outcomes; and (iv) lonapegsomatropin can be stored for 54 months at 2-8°C or up to
six months at room temperatures of /H1134930°C, a more patient-friendly storage requirement than
other growth hormone products that typically require constant storage at 2-8°C and for no more
than 24 months. This advantage offers great flexibility for children with PGHD and their
caregivers, enabling convenient transportation and usage of the medication. By effectively
communicating the value propositions of lonapegsomatropin to healthcare professionals
(“HCPs”), we anticipate successfully persuading prescribing doctors about the product’s
benefits and establishing a promising position in the market.
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Since the commercial launch of lonapegsomatropin by Ascendis Pharma in the fourth
quarter of 2021, Ascendis Pharma has recorded sales revenue of lonapegsomatropin of EUR0.9
million, EUR35.7 million, EUR178.7 million and EUR197.0 million in 2021, 2022, 2023 and
2024, respectively, according to its annual reports.
TransCon CNP (navepegritide)
ACH is a widely recognized condition that can be readily diagnosed by experienced
pediatricians, resulting in a high awareness and diagnosis rate. Patients with ACH have normal
mental development and a pressing need for treatment prior to reaching puberty. There is no
available disease-modifying drug to treat ACH in China. TransCon CNP (navepegritide) is the
only disease-modifying drug under clinical development in China with positive efficacy results
in clinical trials. Once approved, TransCon CNP (navepegritide) is expected to be utilized by
patients over several years during the growth period from two to 15 years old. In addition,
TransCon CNP (navepegritide) has a long half-life of 120 hours porting once-weekly dose
administration.
Once TransCon CNP (navepegritide) is commercially available, our main commercial
goals are to build up the awareness of ACH among key stakeholders, establish TransCon CNP
(navepegritide) as the standard of care for ACH, and establish patient access. The successful
execution of this commercial strategy holds the potential to achieve a rapid revenue uptake
from TransCon CNP (navepegritide).
We expect TransCon CNP (navepegritide) to be included in the NRDL soon after its
approval by undergoing the pricing negotiation process with relevant governmental authorities.
To optimize resources and maximize the effectiveness of our commercial efforts for TransCon
CNP (navepegritide), we have devised a comprehensive and productive program. Given that
the group of HCPs specialized in endocrinology or genetic diseases who treat ACH largely
overlaps with the target HCPs for lonapegsomatropin, we plan to leverage the promotional
synergy between TransCon CNP (navepegritide) and lonapegsomatropin. This includes
utilizing the shared field medical representative team, patient service infrastructure, channel
and distribution network, thereby minimizing the required promotion resources for TransCon
CNP (navepegritide).
Palopegteriparatide
HP is a chronic disease characterized by the deficiency of PTH, which plays a crucial role
in calcium and phosphate metabolism. HP affects a significant patient population, with
approximately 410 thousand individuals affected in 2023. Patients with HP experience daily
challenges related to both physical and mental well-being and often require lifelong treatment.
The optimal approach for managing HP involves PTH replacement therapy to compensate for
the insufficient physiological levels of PTH in the body. Currently, there is no available PTH
replacement therapy for HP due to the extremely short half-life of native PTH, which lasts only
a few minutes. Palopegteriparatide, by leveraging the ability of the transient conjugation
technology (TransCon) to generate long-acting prodrugs of unmodified parent drugs,
SUMMARY
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successfully extends the half-life of PTH to 60 hours, and is potentially the first PTH
replacement therapy for HP treatment over multi-year or even lifetime. Palopegteriparatide
possesses many advantages over conventional therapy as demonstrated in the Phase 3 clinical
trials, and is the most advanced PTH replacement drug under clinical development in China
with few competing products.
The commercial goal for palopegteriparatide includes market development, patient access
and establishing HP treatment centers. Once commercially launched, we expect a rapid revenue
uptake of palopegteriparatide.
We expect palopegteriparatide to be included in the NRDL soon after its approval by
undergoing the pricing negotiation process with relevant governmental authorities. We plan to
deploy an effective and productive commercial program for palopegteriparatide. We plan to
deploy our commercial resources in a “hub-and-spoke” model. We plan to support dozens of
major hospitals with HP treatment expertise to establish HP Center of Excellence across China
as “hubs.” HP patients can receive high-quality diagnosis and key therapy decisions at these
“hubs.” In addition, we plan to cover a few hundred regional hospitals as “spokes.” The
“spoke” hospitals can identify potential HP patients, channel them to “hubs” for key therapy
decisions, while providing easy access for patients’ prescription refills and ongoing HP
management. As most HP patients are treated by adult endocrinologists, we plan to deploy a
separate adult endocrinology medical representative team and medical science liaison (“MSL”)
team to cover these hospitals. The “hub-and-spoke” model may allow us to leverage a small but
elite medical representative team and productive promotion program to cover broad geographic
areas and a large patient pool.
COLLABORATIONS
Exclusive License Agreements with Ascendis Pharma
We own the intellectual property rights to exclusively develop, manufacture, and
commercialize our Core Product and other drug candidates in China (including Hong Kong,
Macau and Taiwan). In November 2018, we entered into three Exclusive License Agreements
with Ascendis Pharma relating to lonapegsomatropin, TransCon CNP (navepegritide) and
palopegteriparatide, respectively, which were subsequently amended in January 2021 due to
the necessity to reflect the evolving cooperation progress between the parties in terms of
technology transfer and Joint Commercialization Committee. Pursuant to the terms of each
agreement, Ascendis Pharma granted us an exclusive (including as to Ascendis Pharma),
royalty-free license under its applicable owned patents and other intellectual property for the
purposes of developing, manufacturing and commercializing the applicable drug candidates in
endocrinology in China (including Hong Kong, Macau and Taiwan). In addition, during the
term of the Exclusive License Agreements, Ascendis Pharma is required to notify us prior to
engaging in substantive discussions with a third party regarding the license to such third party
by Ascendis Pharma or its affiliates of rights to develop or commercialize endocrine drugs in
China (including Hong Kong, Macau and Taiwan) covered by the relevant Exclusive License
SUMMARY
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Agreement, which we will refer to as a ROFN Opportunity. If we inform Ascendis Pharma that
we wish to negotiate an agreement for such ROFN Opportunity, Ascendis Pharma and us shall
enter into good faith negotiations to finalize the relevant license agreement. See “Business –
Collaborations – Exclusive License Agreements with Ascendis Pharma” for more details
regarding the collaboration between us and Ascendis Pharma. We are not obligated to make any
royalty or milestone payments under the relevant Exclusive License Agreements, but have
instead issued to three wholly-owned subsidiaries of Ascendis Pharma A/S an aggregate of
40,000,000 Series A Preferred Shares as consideration for them to enter into these agreements.
Ascendis Pharma is one of our Founding Shareholders. See “History, Development and
Corporate Structure – Major Corporate Development and Shareholding Changes of Our Group”
for more details.
The interests of Ascendis Pharma are highly aligned with ours. See “Relationship with the
Controlling Shareholders” for more details regarding the mutual complementary relationship
between us and Ascendis Pharma.
Strategic Cooperation with China Alliance on Rare Diseases on A National Patient
Registry and Diagnosis Consensus of ACH in China
We supported the founding of Achondroplasia Advisory Board in June 2019 under the
governance of CHARD, a national, non-profit, cooperative exchange platform for rare diseases
by entering into a donation agreement with CHARD, and subsequently entered into a five-year
strategy cooperation with CHARD on a national patient registry and diagnosis consensus of
ACH in China in December 2020.
Strategic Cooperation with Peking University Health Science Center On A Cohort Study
on HP
On July 15, 2021, we entered into a strategic cooperation agreement with Peking
University Health Science Center to initiate the PaTHway R study, the first registry study for
HP patients in China and one of the largest epidemiological surveys for this disease worldwide.
The PaTHway R study aims to enhance the understanding among the public and professionals
regarding the etiology, treatment options, disease burdens of HP and was kicked off in January
2022.
Key Arrangements in relation to Our Local Manufacturing Capabilities for the Core
Product
On December 18, 2023, we entered into a collaboration agreement with WuXi Biologics
to strengthen our commercialization capabilities and establish localized manufacturing
capabilities to secure the supply of our Core Product and future potential drug candidates. The
commercialization of the Core Product manufactured by WuXi Biologics will start once we
obtain the approval of Local BLA, which is expected to occur in 2028.
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Entry into Strategic Collaboration Agreement with Shanghai Pharmaceutical
On October 30, 2023, to advance the expected commercialization of our Core Product and
other products, we entered into a strategic collaboration agreement with Shanghai
Pharmaceutical. Pursuant to such agreement, Shanghai Pharmaceutical will leverage its
expertise and capabilities to assist us to establish the necessary management framework in line
with the GSP .
Entry into Strategic Collaboration Agreement with United Family Healthcare
On August 5, 2024, we entered into the strategic collaboration with the United Family
Healthcare, one of the leading private healthcare providers in China with a network of over ten
hospitals and over 20 clinics across China. This collaboration will focus on jointly developing
capabilities in diagnosis, treatment and services for children with medical needs in growth and
development.
BUSINESS DEVELOPMENT
We will continue to select, develop, and market paradigm-shifting therapeutic drugs that
have the potential to fulfill current unmet medical needs. We aim to bridge global innovation
to bring endocrine therapies to Chinese patients, and plan to become the partner of choice in
endocrinology for China (including Hong Kong, Macau and Taiwan). Thus far, we have a
proven track record of collaborating with Ascendis Pharma, which underscores our credibility
with global biopharmaceutical and biotechnology companies and paves the way for long-term
collaborations. We intend to expand our pipeline portfolio through strategic in-licensing,
collaborations and partnerships with Ascendis Pharma and other biopharmaceutical companies.
Under the Exclusive License Agreements with Ascendis Pharma, we hold a right of first
negotiation on certain future Ascendis Pharma products within the endocrine disease area for
China (including Hong Kong, Macau and Taiwan). This will enable us to source, develop and
commercialize additional drug candidates that are based on the unique transient conjugation
technology (TransCon) and have the potential to be highly differentiated endocrine therapies.
We plan to collaborate with Ascendis Pharma to evaluate future potential drug candidates and
exercise our right for those products who address unmet medical need and possess strong
commercial potential in China (including Hong Kong, Macau and Taiwan). See “Business –
Collaborations – Exclusive License Agreements with Ascendis Pharma” for more details.
Beyond Ascendis Pharma, we plan to leverage our platform and network to pursue
business development opportunities with other potential biopharmaceutical partners with
endocrine drugs, drug candidates or technologies and platforms that may be synergistic or
complementary to our portfolio and/or our capabilities. We believe our relationships with our
Shareholders and a group of strategic and life sciences focused Sophisticated Investors will
contribute to our success in building value-creating partnerships. In the long-term, we plan to
leverage our infrastructure in endocrinology to become the partner of choice for endocrine
treatment looking to enter China (including Hong Kong, Macau and Taiwan).
SUMMARY
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We plan to fully exploit our extensive knowledge in endocrinology and our deep
understanding of the medical need and technology, and through identifying and executing
attractive licensing and collaboration opportunities or through mergers and acquisitions, we
seek to pursue business development opportunities to further expand our portfolio with other
potential biopharmaceutical partners with endocrine drugs, drug candidates or technologies
that may be synergistic or complementary to our portfolio.
Our scaled operation and platform, integrated with a commercial team that targets the
same group of doctors and call points in the endocrinology specialty, is highly synergistic with
strong operating leverage to maximize the value of additional endocrine products looking to
enter China (including Hong Kong, Macau and Taiwan):
 Synergistic clinical stage products with potential. We prioritize bringing in drugs or
drug candidates based on their clinical profile, degree of novelty and validation,
technology differentiation, the unmet medical needs of the target disease and
respective commercial potential in China (including Hong Kong, Macau and
Taiwan).
 Marketed endocrine products with only light commercialization effort required and
attractive cashflow or margin. We are strategically seeking to in-license or acquire
rights to drugs that are either already launched or in late-stage development in
regulated markets such as the United States and the European Union that may be
synergistic or complementary to our portfolio.
As a complementary measure, we will opportunistically look to establish internally
developed pipeline of promising therapies, with local CDMO support or through mergers and
acquisitions of research-driven biotech companies, when the products’ target or MoA fit with
our overall product offering suite and target large market opportunities.
INTELLECTUAL PROPERTY
We own the intellectual property rights to exclusively develop, manufacture, and
commercialize our Core Product and other drug candidates in China (including Hong Kong,
Macau and Taiwan). As of the date of this prospectus, we have exclusively licensed from
Ascendis Pharma 51 issued patents in China (including Hong Kong, Macau and Taiwan), and
61 pending patent applications in China (including Hong Kong, Macau and Taiwan). In
addition, as of the date of this prospectus, we hold two pending patent applications in sole
ownership relating to lonapegsomatropin, and two issued patents and nine pending patent
applications in joint ownership in the PRC in relation to our development of container closure
system. Our patent and patent application portfolio includes the following:
Lonapegsomatropin . We have exclusively licensed from Ascendis Pharma nine issued
patents and six patent applications in China (including Hong Kong, Macau and Taiwan) and
currently hold two patent applications in sole ownership in the PRC relating to
lonapegsomatropin. The issued patents are projected to expire in 2037.
SUMMARY
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TransCon CNP (navepegritide) . We have exclusively licensed from Ascendis Pharma 17
issued patents and 17 patent applications in China (including Hong Kong, Macau and Taiwan)
relating to TransCon CNP (navepegritide). The issued patents are projected to expire in 2040.
Palopegteriparatide . We have exclusively licensed from Ascendis Pharma 16 issued
patents and 26 patent applications in China (including Hong Kong, Macau and Taiwan) relating
to palopegteriparatide. The issued patents are projected to expire in 2037.
Auto-Injector . We have exclusively licensed from Ascendis Pharma 10 issued patents and
12 patent applications in China (including Hong Kong, Macau and Taiwan) relating to the
auto-injector. The issued patents are projected to expire in 2038.
Container closure system . We currently hold two issued patents and nine patent
applications relating to the container closure system in the PRC in joint ownership. The issued
patents are projected to expire in 2034.
We currently do not own or have any exclusive license to any patents or patent
applications in any jurisdictions outside of China (including Hong Kong, Macau and Taiwan)
for lonapegsomatropin, TransCon CNP (navepegritide), and palopegteriparatide.
See “Business – Collaborations – Exclusive License Agreements with Ascendis Pharma”
for more details regarding our exclusive license arrangements with Ascendis Pharma. We
performed due diligence on Ascendis Pharma’s intellectual property rights before entering into
the license agreements with them, but we cannot guarantee that such rights will not be
challenged or that they will provide meaningful exclusivity or competitive advantage or
otherwise enable us to successfully exploit the licensed drug candidates. See “Risk Factors –
Key Risks Related to Our Business, Business Operations, Intellectual Property, Regulatory
Approval of Our Drug Candidates, Commercialization and Financial Prospects – Our
in-licensed patents and patent applications or any patents and patent applications that we own
or in-license in the future may be subject to priority disputes or to inventorship disputes and
similar proceedings. If we or our licensors are unsuccessful in any of these proceedings, we
may be required to obtain licenses from third parties, which may not be available on
commercially reasonable terms or at all, or to cease the development, manufacture and
commercialization of one or more of our drug candidates.”
The term of a patent depends upon the laws of the country in which it is issued. Generally,
a patent term is 20 years from the earliest filing date of a non-provisional patent application.
Under the PRC Patent Law, the term of patent protection starts from the date of application.
Patents relating to inventions are effective for 20 years, and utility models are effective for 10
years and designs are effective for 15 years from the date of application. The patent
compensation system has been effective from June 1, 2021, which may benefit issued patents
in China. For patents relating to new drugs approved for marketing in the PRC, the patent term
may be extended upon request of the patent holder by up to five years as determined by the
SUMMARY
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competent patent authorities, in order to compensate for the time spent for drug marketing
registration and approval procedures, and with such compensation the patent term after the
relevant new drug marketing authorization is approved shall not exceed 14 years.
We conduct our business mainly under the brand name of “VISEN Pharmaceuticals” ( ၪ
؁ᖹุ). As of the Latest Practicable Date, we had 127 registered trademarks and four pending
trademark applications in China (including Hong Kong, Macau and Taiwan). We have one
domain name, which is www.visenpharma.com .
See “Risk Factors – Other Risks Related to Our Intellectual Property” for other risks
related to our intellectual property, and “Appendix IV – Statutory and General Information –
B. Further Information about Our Business” and “Business – Intellectual Property” for more
details regarding our intellectual property rights.
Our Directors confirm that, as of the Latest Practicable Date, we were not a party to any
material legal or administrative proceedings in connection with intellectual property rights or
otherwise, and we are not aware of any claims or proceedings contemplated by Governmental
Authorities or third parties which could materially and adversely affect our business. See
“Business – Legal Proceedings and Compliance.”
SUPPLIERS
Our major suppliers primarily provide us (i) the clinical supplies of our endocrine drug
candidates; (ii) operational services such as patient registry; (iii) certain research and
development services which we outsource to third-party CROs; and (iv) lessors of our leased
properties. We have established stable relationships with many of our key suppliers.
Purchases from our five largest suppliers, for 2022, 2023 and the nine months ended
September 30, 2024 were RMB87.4 million, RMB30.0 million and RMB22.4 million,
respectively, representing 53%, 45% and 54% of our total purchase cost for the respective
period. Purchases from our largest supplier for 2022, 2023 and the nine months ended
September 30, 2024 were RMB63.5 million, RMB17.7 million and RMB6.7 million,
respectively, representing 39%, 26% and 16% of our purchase cost for the respective period.
Save for Ascendis Pharma, all of our five largest suppliers during the Track Record Period
are Independent Third Parties, and none of our Directors, their respective associates nor any
Shareholder who, to the knowledge of our Directors, owned more than 5% of our issued share
capital as at the Latest Practicable Date, has any interest in any of our five largest suppliers
during the Track Record Period.
SUMMARY
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In addition, we believe that adequate alternative sources for such supplies exist and we
have developed alternative sourcing strategies for these supplies. We will establish necessary
relationships with alternative sources based on supply continuity risk assessment. Other than
the agreements with certain CROs, we order supplies and services on a purchase order basis
and have set up CRO bidding and management processes to enable us to obtain better terms
and conditions.
SHAREHOLDER INFORMATION
As at the Latest Practicable Date, Ascendis Pharma A/S, through its wholly-owned
subsidiaries, Ascendis Pharma Endocrinology Division, Ascendis Pharma Growth Disorders
and Ascendis Pharma Bone Diseases (collectively, the “Ascendis Subsidiaries”), was indirectly
interested in an aggregate of approximately 40.12% of the Shares in the Company. Immediately
after the completion of the Global Offering (assuming the Offer Size Adjustment Option and
the Over-allotment Option are not exercised and no Shares are issued under the Post-IPO Share
Award Scheme), Ascendis Pharma A/S, through the Ascendis Subsidiaries, will be indirectly
interested in approximately 36.58% of the Shares in the Company. As at the Latest Practicable
Date, Vivo Plenilune IX Limited, or Vivo Capital, was interested in approximately 35.24% of
the Shares in the Company. Immediately after the completion of the Global Offering (assuming
the Offer Size Adjustment Option and the Over-allotment Option are not exercised and no
Shares are issued pursuant to the Post-IPO Share Award Scheme), Vivo Capital will be
interested in 32.14% of the total issued share capital of our Company (excluding any Shares
that may be subscribed by Vivo Capital under the Global Offering). Vivo Capital is a
wholly-owned subsidiary of Vivo Capital Fund IX (Cayman), L.P ., which is in turn controlled
by its general partner, Vivo Capital IX (Cayman), LLC. (collectively, “Vivo Funds”).
Accordingly, Ascendis Pharma A/S, the Ascendis Subsidiaries, and Vivo Funds will be the
Controlling Shareholders of the Company after the Global Offering. See “Relationship with the
Controlling Shareholders” for details.
Since the establishment of our Company, we have completed two rounds of Pre-IPO
Investments from our Founding Shareholders and Pre-IPO Investors including a group of
strategic and life sciences focused institutional investors who support our mission. The total
funds raised by the Company from the Pre-IPO Investments were approximately US$190
million. We utilized the proceeds for the principal business of our Group as approved by the
Board, including, but not limited to, R&D activities, the growth and expansion of our Group’s
business and general working capital purposes in accordance with the budget approved by the
Board. As at the Latest Practicable Date, approximately 86.1% of the net proceeds from the
Pre-IPO Investments have been utilized. We intended to use the rest net proceeds from the
Pre-IPO investment for further research and development activities, working capital, and other
general corporate purposes. The Sophisticated Investors of our Company include Vivo Capital,
Sofinnova, HongShan Growth, OrbiMed and Sherpa Healthcare Partners holding 32.14%
(excluding any Shares that may be subscribed by Vivo Capital under the Global Offering),
4.65%, 3.64%, 1.62% and 1.62%, respectively, of the total issued share capital of the Company
upon completion of the Listing (assuming the Offer Size Adjustment Option and the
Over-allotment Option are not exercised and no Shares are issued under the Post-IPO Share
Award Scheme. See “History, Development and Corporate Structure – Pre-IPO Investments”
for more details.
SUMMARY
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CONTINUING CONNECTED TRANSACTION
Our Company has entered into and will continue to engage in certain transactions with our
Controlling Shareholders, which will constitute continuing connected transactions upon the
Listing. In connection with these continuing connected transactions, we have applied for, and
the Stock Exchange has granted us, waivers from strict compliance with certain requirements
set out in Chapter 14A of the Listing Rules, including waivers of continuing connected
transactions with terms of more than three years. See “Connected Transactions” for more
details.
RISK FACTORS
We believe that there are certain risks involved in our operations, many of which are
beyond our control. See “Risk Factors” for further details. Some of the major risks we face
include:
 Our rights to develop, manufacture and commercialize our drug candidates are
subject to the terms and conditions of licenses granted to us by Ascendis Pharma. If
we fail to comply with our obligations in our Exclusive License Agreements with
Ascendis Pharma, we could lose the rights to develop, manufacture and
commercialize our drug candidates and be required to pay monetary damages, which
could materially and adversely affect our business operations.
 We expect to procure the Core Product from Ascendis Pharma for the commercial
supply until 2028 following our anticipated commercialization activities in late 2025
after BLA approval, which may expose us to risks such as potential disruptions in
the supply chain and a lack of control over the quality and timing of product supply,
and may adversely affect our business and profitability.
 We have a limited operating history, no products approved for commercial sale,
never generated any revenue and may incur significant losses in the future, which
makes it difficult to assess our future viability. The risks involved in our business
may cause potential investors to lose substantially all of their investment in us.
 We have incurred losses in every year since our inception. We expect to continue to
incur losses over the next several years and may never achieve or maintain
profitability.
SUMMARY
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 None of our drug candidates has received a marketing approval in China (including
Hong Kong, Macau and Taiwan). If we are unable to advance our drug candidates
through clinical development, obtain regulatory approval and/or ultimately
commercialize our drug candidates, or experience significant delays in doing so, our
business and profitability will be materially harmed.
SUMMARY OF KEY FINANCIAL INFORMATION
This summary historical data of financial information set forth below is derived from, and
should be read in conjunction with, our consolidated financial statements, including the
accompanying notes, set forth in the Accountants’ Report in Appendix I to this document, as
well as the information set forth in “Financial Information.” Our financial information was
prepared in accordance with IFRS.
Summary of Our Consolidated Statements of Profit or Loss and Other Comprehensive
Income
We currently have no product approved for commercial sale and have not generated any
revenue from product sales. We have incurred operating losses in each year since inception and
during the Track Record Period. Our total comprehensive losses were RMB288.9 million,
RMB249.5 million and RMB129.7 million in 2022, 2023 and the nine months ended September
30, 2024, respectively, the change of which was primarily due to the decrease of RMB121.8
million in R&D expenses in relation to our drug candidates for the year ended December 31,
2023, and the loss from a discontinued procurement contract recorded in the amount of
RMB109.0 million for the year ended December 31, 2023 in relation to our cancellation of the
commitment to purchase the previously reserved drug substance under the commitment and
pre-payment agreement in February 2023. Substantially all of our operating losses resulted
from R&D expenses, administrative expenses, and other gains and losses, net. See our
consolidated statements of profit or loss and other comprehensive income set forth in the
Accountants’ Report in Appendix I to this document for details of the fluctuation in our total
comprehensive losses.
We expect to incur significant expenses and operating losses for at least the next several
years as we further our clinical R&D efforts, continue the clinical development of and seek
regulatory approval for our drug candidates, launch commercialization of our pipeline
products, and add personnel necessary to operate our business. Subsequent to the Listing, we
expect to incur costs associated with operating as a public company. We expect that our
financial performance will fluctuate from period to period due to the development status of our
drug candidates, regulatory approval timeline and commercialization of our drug candidates
after approval.
SUMMARY
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The table below sets forth our consolidated statements of profit or loss and other
comprehensive income for the periods indicated derived from our consolidated statements of
profit or loss and other comprehensive income set forth in the Accountants’ Report in Appendix
I to this document:
Y ear Ended
December 31,
Nine Months Ended
September 30,
2022 2023 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Other income 5,764 11,356 8,809 8,647
Other gains and losses, net 77,184 (106,695) (102,433) (388)
Research and development
costs (179,546) (57,690) (38,083) (58,907)
Administrative expenses (177,449) (79,944) (64,064) (64,386)
Finance costs (619) (317) (248) (129)
Listing expenses (14,301) (16,280) (12,323) (14,332)
Loss before tax (288,967) (249,570) (208,342) (129,495)
Income tax expense ––––
Loss for the year/period (288,967) (249,570) (208,342) (129,495)
Exchange differences on
translation of the financial
statements of subsidiaries 69 106 (4) (186)
Total comprehensive loss
for the year/period (288,898) (249,464) (208,346) (129,681)
SUMMARY
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Summary of Our Consolidated Statements of Financial Position
The table below sets forth selected information from our consolidated statements of
financial position as of the dates indicated, which have been derived from the Accountants’
Report in Appendix I to this document:
As of December 31,
As of
September 30,
2022 2023 2024
RMB’000 RMB’000 RMB’000
NON-CURRENT ASSETS
Property, plant and equipment 2,352 876 371
Right-of-use assets 14,812 12,379 11,523
Intangible assets 1,415 567 69
Amount advanced to a related
party – 39,193 39,193
Prepayments and other
receivables 11,103 16,660 18,821
Total non-current assets 29,682 69,675 69,977
CURRENT ASSETS
Prepayments and other
receivables 15,961 16,972 13,818
Amount advanced to a related
party 69,171 9,367 12,494
Cash and cash equivalents 626,458 347,782 242,647
Total current assets 711,590 374,121 268,959
CURRENT LIABILITIES
Trade and other payables 49,460 37,582 38,289
Deferred income 2,900 2,900 –
Amounts due to related parties 30,311 8,790 8,061
Lease liabilities 4,668 2,552 2,389
Total current liabilities 87,339 51,824 48,739
Net current assets 624,251 322,297 220,220
Total assets less current
liabilities 653,933 391,972 290,197
SUMMARY
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As of December 31,
As of
September 30,
2022 2023 2024
RMB’000 RMB’000 RMB’000
NON-CURRENT
LIABILITIES
Lease liabilities 1,328 1,097 599
Total non-current liabilities 1,328 1,097 599
Net assets 652,605 390,875 289,598
EQUITY
Equity attributable to owners
of the Company
Share capital 70 70 70
Treasury shares (6) (6) (6)
Reserves 652,541 390,811 289,534
Total equity 652,605 390,875 289,598
We had net current assets of RMB161.0 million as of January 31, 2025, being the latest
practicable date for the purpose of liquidity disclosure in this document, which decreased from
RMB220.2 million as of September 30, 2024, primarily due to a decrease in cash and cash
equivalents from RMB242.6 million as of September 30, 2024 to RMB193.6 million as of
January 31, 2025 as a result of the operating costs associated with our R&D and administrative
activities.
Our net current assets decreased from RMB322.3 million as of December 31, 2023 to
RMB220.2 million as of September 30, 2024, primarily due to a decrease of RMB105.1 million
in cash and cash equivalents as a result of the operating costs associated with our R&D and
administrative activities.
Our net current assets decreased from RMB624.3 million as of December 31, 2022 to
RMB322.3 million as of December 31, 2023, primarily due to a decrease of RMB278.7 million
in cash and cash equivalents as a result of the operating costs associated with our R&D and
administrative activities and a decrease of RMB59.8 million in amount advanced to a related
party.
Our net assets decreased from RMB390.9 million as of December 31, 2023 to RMB289.6
million as of September 30, 2024, primarily due to our loss for the period of RMB129.5 million
in the nine months ended September 30, 2024, partially offset by our recognition of
equity-settled share-based payment of RMB28.4 million in the same period.
SUMMARY
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Our net assets decreased from RMB652.6 million as of December 31, 2022 to RMB390.9
million as of December 31, 2023, primarily due to our loss for the year of RMB249.6 million
in 2023.
Summary of Our Consolidated Statements of Cash Flow
The following table sets forth a summary of our cash flows for the periods indicated:
Y ear Ended
December 31,
Nine Months Ended
September 30,
2022 2023 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Net cash flows used in
operating activities (246,549) (271,310) (155,734) (102,406)
Net cash flows used in
investing activities (1,766) (520) (348) (117)
Net cash flows used in
financing activities (7,949) (6,952) (4,816) (2,426)
Net decrease in cash and
cash equivalents (256,264) (278,782) (160,898) (104,949)
Cash and cash equivalents at
beginning of
the year/period 882,653 626,458 626,458 347,782
Cash and cash equivalents at
end of the year/period 626,458 347,782 465,556 242,647
During the Track Record Period, we incurred negative cash flows from our operations.
Substantially all of our operating cash outflows have resulted from our R&D costs and
administrative expenses. During the Track Record Period, our primary uses of cash included
funding the R&D of our drug candidates, expenses for regulatory filing activities of the Core
Product, purchasing quality control testing samples for the Core Product, prepayments for
future commercial supply of drug products, losses from discontinued procurement contracts, as
well as other working capital needs. During the Track Record Period, we funded our operations
through private equity financing. We monitor and maintain a level of cash and cash equivalents
deemed adequate by our management to finance the operations and mitigate the effects of
fluctuations in cash flows. Going forward, we believe our liquidity requirements will be
satisfied by a combination of net proceeds from the Global Offering and cash generated from
our operations.
Our cash burn rate refers to the average monthly (i) net cash used in operating activities,
including clinical development and business development activities; (ii) capital expenditures;
and (iii) lease payments. We had cash and cash equivalents of RMB242.6 million as of
September 30, 2024. We estimate that we will receive net proceeds of approximately HK$570.8
million, equivalent to RMB526.5 million, after deducting the underwriting fees and expenses
payable by us in the Global Offering, assuming neither Offer Size Adjustment Option nor
SUMMARY
–2 7–


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Over-allotment Option is exercised and assuming an Offer Price of HK$68.44 per Offer Share,
being the low-end of the indicative Offer Price range in this document. We estimate that our
cash and cash equivalents as of September 30, 2024 will be able to maintain our financial
viability for 12 months or, if we take into account 6.6% of the estimated net proceeds from the
Listing (namely, the portion allocated for our working capital and other general corporate
purposes), 14 months or, if we also take into account the estimated net proceeds from the
Listing, 42 months. We will continue to monitor our cash flows from operations closely and
expect to raise our next round of financing, if needed, with a minimum buffer of 12 months.
KEY FINANCIAL RATIO
The following table sets forth the current ratio of our Group as of the dates indicated:
As of December 31,
As of
September 30,
2022 2023 2024
Current ratio (1) 8.15 7.22 5.52
Note:
(1) Current ratio equals current assets divided by current liabilities as of the same date.
Our current ratio decreased from 7.22 as of December 31, 2023 to 5.52 as of September
30, 2024, mainly due to a decrease in our current assets from RMB374.1 million as of
December 31, 2023 to RMB269.0 million as of September 30, 2024, which was primarily due
to a decrease of RMB105.1 million in cash and cash equivalents as a result of the operating
costs associated with our R&D and administrative activities.
Our current ratio decreased from 8.15 as of December 31, 2022 to 7.22 as of December
31, 2023, mainly due to a decrease in our current assets from RMB711.6 million as of
December 31, 2022 to RMB374.1 million as of December 31, 2023, which was primarily due
to a decrease of RMB278.7 million in cash and cash equivalents. See “Financial Information
– Discussion of Certain Selected Items from the Consolidated Statements of Financial Position
– Net Current Assets.”
RECENT DEVELOPMENTS
BLA Filing of Our Core Product
We made the BLA filing with the NMPA on January 18, 2024 for our Core Product for
the treatment of PGHD, which was subsequently accepted by the NMPA on March 7, 2024.
SUMMARY
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Entry into Strategic Collaboration Agreement with United Family Healthcare
On August 5, 2024, we entered into the strategic collaboration with the United Family
Healthcare, one of the leading private healthcare providers in China with a network of over ten
hospitals and over 20 clinics across China. This collaboration will focus on jointly developing
capabilities in diagnosis, treatment and services for children with medical needs in growth and
development.
No Material Adverse Change
Our Directors confirm that, up to the date of this document, there has been no material
adverse change in our financial or trading position since September 30, 2024 (being the date
on which the latest consolidated financial information of our Group was prepared) and there
has been no event since September 30, 2024 which would materially affect the information
shown in our consolidated financial statements included in the Accountants’ Report in
Appendix I to this document.
Unaudited Preliminary Financial Information for the Y ear Ended December 31, 2024
Based on the unaudited preliminary financial information as of and for the year ended
December 31, 2024 (the “2024 Preliminary Financial Information”), (i) our other income
decreased from RMB11.4 million in 2023 to RMB9.9 million in 2024, primarily attributable to
a decrease in bank interest income as a result of a decrease in our average bank deposit balance
in 2024, partially offset by an increase in the government grants and other subsidies related to
income; (ii) we recorded net other gains of RMB2.4 million in 2024 as compared to net other
losses of RMB106.7 million in 2023, primarily due to the loss from a discontinued procurement
contract recorded in the amount of RMB109.0 million in relation to our cancellation of the
commitment to purchase the previously reserved drug substance under the commitment and
pre-payment agreement in February 2023; (iii) our research and development costs increased
from RMB57.7 million in 2023 to RMB90.5 million in 2024, primarily due to the reversal of
certain share-based payment expenses of RMB29.3 million in 2023 mainly in relation to the
retirement of relevant employees in 2023, and an increase of costs related to Technology
Transfer of RMB9.9 million in 2024 in line with the Technology Transfer progress; (iv) our
administrative expenses increased from RMB79.9 million in 2023 to RMB86.4 million in 2024,
primarily due to the reversal of certain share-based payment expenses of RMB14.0 million in
2023 mainly in relation to the re-assessment of certain milestone achievements under the
Equity Incentive Plan, partially offset by a decrease in staff costs of RMB10.4 million. As a
result of the foregoing, our loss for the year decreased from RMB249.6 million in 2023 to
RMB182.2 million in 2024. See “Appendix IIB – Unaudited Preliminary Financial Information
for the Y ear Ended December 31, 2024” for details.
SUMMARY
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The 2024 Preliminary Financial Information as set out in Appendix IIB to this prospectus
have been agreed with the reporting accountants of our Company following their work under
Practice Note 730 “Guidance for Auditors Regarding Preliminary Announcements of Annual
Results” issued by the Hong Kong Institute of Certified Public Accountants. The work
performed by the reporting accountants in this respect did not constitute an assurance
engagement in accordance with Hong Kong Standards on Auditing, Hong Kong Standards on
Review Engagements or Hong Kong Standards on Assurance Engagements issued by the Hong
Kong Institute of Certified Public Accountants and consequently no opinion or assurance
conclusion has been expressed by the reporting accountants on the 2024 Preliminary Financial
Information. Since such preliminary financial information has not been audited by our
reporting accountants or any other independent auditor, such financial information should not
be relied upon to provide the same quality of information associated with information that has
been subject to an audit by an independent auditor.
THE GLOBAL OFFERING
The Global Offering consists of:
(i) the Hong Kong Public Offering of 990,000 Shares (subject to reallocation and the
Offer Size Adjustment Option) in Hong Kong; and
(ii) the International Offering of 8,910,000 Shares (subject to reallocation, the Offer
Size Adjustment Option and the Over-allotment Option) outside the United States in
accordance with Regulation S and in the United States to QIBs in accordance with
Rule 144A.
OFFERING STATISTICS
The statistics in the following table are based on the assumptions that (i) the Global
Offering has been completed and 9,900,000 Offer Shares are issued pursuant to the Global
Offering; (ii) the Offer Size Adjustment Option is not exercised; (iii) the Over-allotment
Option is not exercised; and (iv) no Shares are issued under the Post-IPO Share Award Scheme.
Based on an
Offer Price of
HK$68.44
Based on an
Offer Price of
HK$75.28
Market capitalization of our Shares (1)
HK$7,695.5
million
HK$8,464.6
million
Unaudited pro forma adjusted consolidated net
tangible assets attributable to owners of the
Company per share as of September 30, 2024
(2) HK$8.48 HK$9.06
SUMMARY
–3 0–


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Notes:
(1) Calculation of market capitalization is based on 112,441,864 Shares expected to be in issue immediately
after completion of the Global Offering (assuming the Offer Size Adjustment Option and the
Over-allotment Option are not exercised and no Shares are issued under the Post-IPO Share Award
Scheme).
(2) The unaudited pro forma adjusted consolidated net tangible assets per Share is arrived at after deduction
of the underwriting fees and other related expenses payable by the Company and on the basis of
112,441,864 Shares in issue, assuming that the (i) Global Offering and (ii) the issuance of 330,000
Shares and cancellation of 765,000 Shares have been completed on September 30, 2024 but does not
take into account (i) any Shares which may be sold pursuant to the Offer Size Adjustment Option or the
exercise of the Over-allotment Option, or (ii) any Shares which may be issued under the Post-IPO share
incentive scheme.
DIVIDENDS
We have never declared nor paid any dividends on our ordinary shares or any other
securities during the Track Record Period. We currently intend to retain all available funds and
earnings, if any, to fund the development and expansion of our business and we do not
anticipate paying any cash dividends in the foreseeable future. Investors should not purchase
our ordinary shares with the expectation of receiving cash dividends.
Any future determination to pay dividends will be made at the discretion of our Directors
or the Shareholders in general meeting, and may be based on a number of factors, including
our future operations and earnings, capital requirements and surplus, general financial
condition, contractual restrictions and other factors that our Directors may deem relevant. As
advised by our Cayman Islands counsel, under the Cayman Islands law a company may declare
and pay a dividend out of either profits or share premium account, provided that in no
circumstances may a dividend be declared or paid if this would result in the company being
unable to pay its debts as they fall due in the ordinary course of business. Investors should not
purchase our shares with the expectation of receiving cash dividends.
LISTING EXPENSES
Listing expenses mainly comprise legal and other professional fees paid and payable to
the professional parties, commissions payable to the Underwriters, and printing and other
expenses for their services rendered in relation to the Listing and the Global Offering. Listing
expenses for the Global Offering are estimated to be approximately HK$108.1 million,
including (i) underwriting-related expenses (including but not limited to commissions and fees)
of approximately HK$29.6 million and (ii) non-underwriting-related expenses of
approximately HK$78.5 million, comprising (a) fees and expenses of legal advisors and
accountants of approximately HK$64.3 million and (b) other fees and expenses of
approximately HK$14.2 million, at an Offer Price of HK$71.86 per Share, being the mid-point
of the indicative Offer Price range, which represents approximately 15.2% of the gross
proceeds we expect to receive from this Global Offering assuming no Shares are issued
pursuant to the Offer Size Adjustment Option or the Over-allotment Option and no Shares are
issued under the Post-IPO Share Award Scheme. RMB63.6 million (HK$68.9 million) was
SUMMARY
–3 1–


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recognized and charged to our consolidated statements of profit or loss and other
comprehensive income as of September 30, 2024. After September 30, 2024, approximately
HK$13.1 million is expected to be charged to our consolidated statements of profit or loss and
other comprehensive income, and approximately HK$26.1 million is expected to be charged
against equity upon the Listing. The listing expenses above are the latest practicable estimate
for reference only, and the actual amount may differ from this estimate.
USE OF PROCEEDS
Assuming an Offer Price of HK$71.86, being the mid-point of the indicative Offer Price
range, and after deducting estimated underwriting fees and the estimated offering expenses in
connection with the Hong Kong Public Offering and International Offering, and the Offer Size
Adjustment Option and the Over-allotment Option are not exercised, we estimate that the
aggregate net proceeds from the Global Offering will be approximately HK$603.3 million.
In line with our strategies, we intend to use the net proceeds we will receive from the
Global Offering for the following purposes, subject to changes in light of our evolving business
needs and changing market conditions:
Allocation of the estimated net proceeds Proposed main purposes
84.0%, or HK$506.9 million To fund the ongoing BLA registration of
imported Core Product, ongoing and planned
research and development and BLA
registration of locally manufactured Core
Product, planned clinical trial on new
indication expansion, and planned
commercial launch of our Core Product,
lonapegsomatropin;
7.6%, or HK$45.7 million To fund the ongoing OLE portion of China
Phase 3 pivotal trial and preparation for
commercial launch of palopegteriparatide;
1.8%, or HK$10.7 million To fund the ongoing open-label portion of
China Phase 2 trial of TransCon CNP
(navepegritide) and relevant analysis for the
treatment of ACH; and
6.6%, or HK$40.0 million To fund our working capital and other general
corporate purposes.
See “Future Plans and Use of Proceeds” for more details.
SUMMARY
–3 2–


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In this prospectus, unless the context otherwise requires, the following terms shall
have the meanings set out below.
“Accountants’ Report” the accountant’s report of our Company, the text of which
is set out in Appendix I to this prospectus
“affiliate(s)” with respect to any specified person, any other person,
directly or indirectly, controlling or controlled by or
under direct or indirect common control with such
specified person
“AFRC” the Accounting and Financial Reporting Council of Hong
Kong
“Articles” or “Articles of
Association”
the articles of association of our Company conditionally
adopted by a special resolution passed on March 8, 2025
with effect from the Listing Date, a summary of which is
set forth in “Summary of the Constitution of the
Company” in Appendix III to this document
“Ascendis Pharma” a group of entities comprised of Ascendis Pharma A/S,
Ascendis Pharma Bone Diseases, Ascendis Pharma
Endocrinology Division and Ascendis Pharma Growth
Disorders (or certain member/members of the group,
where the context otherwise requires)
“Ascendis Pharma A/S” a company registered in Denmark on September 21,
2006, a biopharmaceutical company listed on the Nasdaq
(Ticker Symbol: ASND) since January 2015, and one of
our Controlling Shareholders
“Ascendis Pharma Bone
Diseases”
Ascendis Pharma Bone Diseases A/S, a company
registered in Denmark on June 29, 2012, a wholly-owned
subsidiary of Ascendis Pharma A/S, and one of our
Controlling Shareholders
“Ascendis Pharma Endocrinology
Division”
Ascendis Pharma Endocrinology Division A/S, a
company registered in Denmark on June 29, 2012, a
wholly-owned subsidiary of Ascendis Pharma A/S, and
one of our Controlling Shareholders
DEFINITIONS
–3 3–


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“Ascendis Pharma Growth
Disorders”
Ascendis Pharma Growth Disorders A/S, a company
registered in Denmark on June 29, 2012, a wholly-owned
subsidiary of Ascendis Pharma A/S, and one of our
Controlling Shareholders
“associate(s)” has the meaning ascribed to it under the Listing Rules
“Board” the board of Directors
“business day” any day (other than a Saturday, Sunday or public holiday
in Hong Kong) on which banks in Hong Kong are
generally open for normal banking business
“BVI” the British Virgin Islands
“CAGR” compound annual growth rate
“Capital Market Intermediaries” the capital market intermediaries participating in the
Global Offering and has the meaning ascribed thereto
under the Listing Rules
“Cayman Companies Act” or
“Companies Act”
the Companies Act, Cap. 22 (Law 3 of 1961, as
consolidated and revised) of the Cayman Islands
“CCASS” the Central Clearing and Settlement System established
and operated by HKSCC
“CRF Investment” CRF Investment Holdings Company Limited, an
exempted company incorporated in the Cayman Islands
on November 14, 2017, a Pre-IPO Investor
“CHARD” China Alliance for Rare Disease ( ʕ਷ӼԈषᑌຑ), a
national, non-profit, cooperative exchange platform for
rare disease, approved by the national health authority
and supported by multiple hospital associations and
universities
“China” or “the PRC” the People’s Republic of China, and for the purposes of
this document only, except where the context requires
otherwise, references to China or the PRC exclude the
special administrative regions of Hong Kong and Macau
and Taiwan
DEFINITIONS
–3 4–


--- page 45 ---
“Clinical Supply Agreements” three supply agreements entered into between our
Company and Ascendis Pharma Endocrinology Division,
Ascendis Pharma Growth Disorders and Ascendis Pharma
Bone Diseases, respectively, on November 7, 2018, each
a Clinical Supply Agreement
“Companies Ordinance” the Companies Ordinance (Chapter 622 of the Laws of
Hong Kong), as amended, supplemented or otherwise
modified from time to time
“Companies (Winding Up and
Miscellaneous Provisions)
Ordinance”
the Companies (Winding Up and Miscellaneous
Provisions) Ordinance (Chapter 32 of the Laws of Hong
Kong), as amended, supplemented or otherwise modified
from time to time
“Company,” “our Company,” or
“the Company”
VISEN Pharmaceuticals, an exempted company with
limited liability incorporated in the Cayman Islands on
November 1, 2018
“connected person(s)” has the meaning ascribed to it under the Listing Rules
“connected transaction(s)” has the meaning ascribed to it under the Listing Rules
“Controlling Shareholder(s)” has the meaning ascribed to it under the Listing Rules and
unless the context otherwise requires, refers to the
entities as mentioned in the section headed “Relationship
with the Controlling Shareholders” in this document,
namely, Ascendis Pharma A/S and its wholly-owned
subsidiaries, Ascendis Pharma Endocrinology Division,
Ascendis Pharma Growth Disorders and Ascendis Pharma
Bone Diseases and Vivo Capital, Vivo Capital IX
(Cayman), LLC., Vivo Capital Fund IX (Cayman), L.P .
“Cormorant” our Pre-IPO Investors, including Cormorant Global
Healthcare Master Fund, LP , Cormorant Private
Healthcare Fund III, LP and CRMA SPV , L.P .
“Director(s)” the director(s) of our Company
“EMA” European Medicines Agency
DEFINITIONS
–3 5–


--- page 46 ---
“Equity Incentive Plan” the equity incentive plan as adopted by the Board on
April 29, 2019 and approved by the Shareholders on June
26, 2019, as amended on January 8, 2021 and March 10,
2021
“Euro”, “EUR” or “
C” the lawful currency of the European Union
“Exclusive License Agreements” three exclusive license agreements entered into between
our Company and Ascendis Pharma Endocrinology
Division, Ascendis Pharma Growth Disorders and
Ascendis Pharma Bone Diseases, respectively, on
November 7, 2018 (as amended, respectively, on January
4, 2021), each an Exclusive License Agreement
“Extreme Conditions” extreme conditions caused by a super typhoon as
announced by the government of Hong Kong
“FDA” U.S. Food and Drug Administration
“FINI” “Fast Interface for New Issuance”, an online platform
operated by HKSCC that is mandatory for admission to
trading and, where applicable, the collection and
processing of specified information on subscription in
and settlement for all New Listings
“Founding Shareholder(s)” Ascendis Pharma A/S, Vivo Capital and Sofinnova
“Frost & Sullivan” Frost & Sullivan International Limited
“Frost & Sullivan Report” the report prepared by Frost & Sullivan
“FTE” a full time equivalent person year of work (consisting of
1,673 hours per year for work in Denmark, 1,768 hours
per year for work in Germany, or 1,840 hours per year for
work in the US), prorated on a daily or hourly basis as
necessary
“General Rules of HKSCC” the terms and conditions regulating the use of HKSCC’s
services, as may be amended or modified from time to
time and where the context so permits, shall include the
HKSCC Operational Procedures
“Global Offering” the Hong Kong Public Offering and the International
Offering
DEFINITIONS
–3 6–


--- page 47 ---
“Governmental Authority(ies)” any governmental, regulatory, or administrative
commission, board, body, authority, or agency, or any
stock exchange, self-regulatory organization, or other
non-governmental regulatory authority, or any court,
judicial body, tribunal, or arbitrator, in each case whether
national, central, federal, provincial, state, regional,
municipal, local, domestic, foreign, or supranational
“Group,” “our Group,”
“the Group,” “we,” “us,” or
“our”
the Company and its subsidiaries from time to time, and
where the context requires, in respect of the period prior
to our Company becoming the holding company of its
present subsidiaries, such subsidiaries as if they were
subsidiaries of our Company at the relevant time
“HBM Healthcare Investments” HBM Healthcare Investments (Cayman) Ltd., a company
established under the laws of Cayman Islands on May 8,
2001, a Pre-IPO Investor
“HongShan” a leading venture capital and private equity firm
investing across technology, healthcare and consumer
sectors
“HongShan Growth” HSG Growth VI Holdco F LTD., a company established
under the laws of the Cayman Islands on July 2, 2020, a
Pre-IPO Investor
“HK” or “Hong Kong” the Hong Kong Special Administrative Region of the
People’s Republic of China
“HKSCC” Hong Kong Securities Clearing Company Limited, a
wholly-owned subsidiary of Hong Kong Exchanges and
Clearing Limited
“HKSCC EIPO ” the application of the Hong Kong Offer Shares to be
allotted and issued in the name of HKSCC Nominees,
deposited directly into CCASS and credited to your
designated HKSCC Participant’s stock account by
instructing your broker or custodian who is a HKSCC
Participant to submit electronic application instructions
on your behalf through HKSCC’s FINI system in
accordance with your instruction
“HKSCC Nominees” HKSCC Nominees Limited, a wholly-owned subsidiary
of HKSCC
DEFINITIONS
–3 7–


--- page 48 ---
“HKSCC Participant” a participant admitted to participate in CCASS as a direct
clearing participant, a general clearing participant or a
custodian participant
“Hong Kong dollars” or “HK$” Hong Kong dollars, the lawful currency of Hong Kong
“Hong Kong Offer Shares” the 990,000 Shares being initially offered for
subscription in the Hong Kong Public Offering (subject
to reallocation and the Offer Size Adjustment Option as
described in the section headed “Structure of the Global
Offering”)
“Hong Kong Public Offering” the offer of the Hong Kong Offer Shares for subscription
by the public in Hong Kong at the Offer Price (plus
brokerage of 1%, SFC transaction levy of 0.0027%, Stock
Exchange trading fee of 0.00565% and AFRC transaction
levy of 0.00015%) on the terms and subject to the
conditions described in this document, as further
described in the section headed “Structure of the Global
Offering – The Hong Kong Public Offering”
“Hong Kong Share Registrar” Computershare Hong Kong Investor Services Limited
“Hong Kong Underwriters” the underwriters of the Hong Kong Public Offering as
listed in “Underwriting – Hong Kong Underwriters”
“Hong Kong Underwriting
Agreement”
the Hong Kong underwriting agreement dated March 12,
2025 relating to the Hong Kong Public Offering entered
into, among others, our Company, the Controlling
Shareholders, the Overall Coordinators, the Joint Global
Coordinators and the Hong Kong Underwriters, as further
described in “Underwriting – Underwriting arrangements
and expenses – Hong Kong Public Offering”
“IFRS(s)” International Financial Reporting Standards, as issued
from time to time by the International Accounting
Standards Board
“Independent Third Party(ies)” any entity or person who is not a connected person of our
Company or an associate of such person within the
meaning ascribed to it under the Listing Rules
DEFINITIONS
–3 8–


--- page 49 ---
“International Offer Shares” the 8,910,000 Shares being initially offered for
subscription under the International Offering together,
where relevant, with any additional Shares that may be
sold pursuant to any exercise of the Over-allotment
Option (subject to reallocation and the Offer Size
Adjustment Option as described in “Structure of the
Global Offering”)
“International Offering” the conditional placing of the International Offer Shares
at the Offer Price outside the United States in offshore
transactions in accordance with Regulation S and in the
United States to QIBs only in reliance on Rule 144A or
any other available exemption from the registration
requirements under the U.S. Securities Act, as further
described in the section headed “Structure of the Global
Offering”
“International Underwriters” the underwriters of the International Offering
“International Underwriting
Agreement”
the international underwriting agreement relating to the
International Offering to be entered into among our
Company and the International Underwriters on or about
the Price Determination Date, as further described in
“Underwriting – International Offering”
“Joint Bookrunners,”
“Joint Global Coordinators”
and “Joint Lead Managers”
the joint bookrunners, the joint global coordinators, and
the joint lead managers as named in “Directors and
parties involved in the Global Offering”
“Joint Sponsors” Morgan Stanley Asia Limited and Jefferies Hong Kong
Limited
“KOL” key opinion leader
“Latest Practicable Date” March 4, 2025, being the latest practicable date for
ascertaining certain information in this document before
its publication
“laws” all laws, statutes, legislation, ordinances, rules,
regulations, guidelines, opinions, notices, circulars,
directives, requests, orders, judgments, decrees, or
rulings of any Governmental Authority (including the
Stock Exchange and the SFC) of all relevant jurisdictions
DEFINITIONS
–3 9–


--- page 50 ---
“Listing” the listing of the Shares on the Main Board
“Listing Committee” the Listing Committee of the Stock Exchange
“Listing Date” the date, expected to be on or about Friday, March 21,
2025, on which the Shares are to be listed and on which
dealings in the Shares are to be first permitted to take
place on the Stock Exchange
“Listing Rules” the Rules Governing the Listing of Securities on The
Stock Exchange of Hong Kong Limited, as amended,
supplemented or otherwise modified from time to time
“Logos Capital” Logos Opportunities Fund II LP , a limited partnership
established under the laws of the State of Delaware on
March 26, 2020, a Pre-IPO Investor
“Macau” the Macau Special Administrative Region of the People’s
Republic of China
“Main Board” the stock exchange (excluding the option market)
operated by the Stock Exchange which is independent
from and operates in parallel with the Growth Enterprise
Market of the Stock Exchange
“Memorandum” or
“Memorandum of Association”
the memorandum of association of our Company
conditionally adopted by a special resolution passed on
March 8, 2025, with effect from the Listing Date
“MOFCOM” the Ministry of Commerce of the PRC ( ʕശɛ͏΍ձ਷
ਠਕ௅)
“NDA” new drug application, submission of which is the vehicle
through which drug sponsors formally propose that the
relevant drug regulatory authority approve a new
pharmaceutical for sale and marketing in accordance with
local rules and regulations
“NMPA” National Medical Products Administration (္
ຖ၍ଣ҅), the successor of the China Food and Drug
Administration (္ຖ၍ଣᐼ҅) (the
“CFDA”), the State Food and Drug Administration (࢕
္ຖ၍ଣ҅) (the “SFDA”) and the State Drug
Administration (္ຖ၍ଣ҅) (the “SDA”)
DEFINITIONS
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--- page 51 ---
“NPC” National People’s Congress (ɽึ)
“NRDL” National Reimbursement Drug List of China (ਿ͉
ͦ፽)
“Offer Price” the final offer price per Offer Share (exclusive of
brokerage, SFC transaction levy, Stock Exchange trading
fee and AFRC transaction levy), expressed in Hong Kong
dollars, at which Hong Kong Offer Shares are to be
subscribed for pursuant to the Hong Kong Public
Offering and International Offer Shares are to be offered
pursuant to the International Offering, to be determined
as described in “Structure of the Global Offering –
Pricing and Allocation”
“Offer Share(s)” the Hong Kong Offer Shares and the International Offer
Shares together, where relevant, with any additional
Shares to be sold by our Company pursuant to the
exercise of the Offer Size Adjustment Option or the
Over-allotment Option
“Offer Size Adjustment Option” the option under the Hong Kong Underwriting
Agreement, exercisable by the Company on or before the
Price Determination Date, pursuant to which the
Company may issue and allot up to an aggregate of
1,485,000 additional Shares at the Offer Price, to cover
additional market demand, if any, as described in the
section headed “Structure of the Global Offering” in this
prospectus
“OrbiMed” our Pre-IPO investors, including Worldwide Healthcare
Trust PLC, OrbiMed Genesis Master Fund, L.P . and
OrbiMed New Horizons Master Fund, L.P .
“Overall Coordinators”
and “Sponsor-Overall
Coordinators”
the overall coordinators and sponsor-overall coordinators
as named in “Directors and Parties Involved in the Global
Offering” in this prospectus
DEFINITIONS
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“Over-allotment Option” the option expected to be granted by our Company to the
International Underwriters, exercisable by the Joint
Global Coordinators and the Overall Coordinators (for
themselves and on behalf of the International
Underwriters) for up to 30 days from the day following
the last day for the lodging of applications under the
Hong Kong Public Offering, to require our Company to
allot and issue up to an additional 1,485,000 Shares
(representing not more than 15% of the Offer Shares
initially available under the Global Offering assuming the
Offer Size Adjustment Option is not exercised at all) or
up to an additional 1,707,700 Shares (representing not
more than 15% of the Offer Shares being offered under
the Global Offering assuming the Offer Size Adjustment
Option is exercised in full) at the Offer Price to the
International Underwriters to cover over-allocations in
the International Offering, if any, details of which are
described in the section headed “Structure of the Global
Offering – Over-allotment Option”
“Pivotal bioV enture Partners
China”
Cosmic Clover Limited, a company established under the
laws of BVI on August 2, 2017, a Pre-IPO Investor
“Post-IPO Share Award Scheme” the post-IPO share award scheme as adopted by the Board
on November 8, 2022 and approved by the Shareholders
on November 16, 2022
“PRC Legal Adviser” JunHe LLP , our legal adviser on PRC law
“PRDL” Provincial Reimbursement Drug List of China (ॴਿ
ͦ፽)
“Preferred Share(s)” the Series A Preferred Shares and the Series B Preferred
Shares
“Pre-IPO Investment(s)” the investment(s) in our Company undertaken by the
Series A Preferred Shareholders and Series B Preferred
Shareholders prior to this initial public offering, the
details of which are set forth in “History, Development
and Corporate Structure”
DEFINITIONS
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“Pre-IPO Investor(s)” HongShan Growth, OrbiMed, Sherpa Healthcare
Partners, Cormorant, HBM Healthcare Investments,
Pivotal bioV enture Partners China, Logos Capital and
CRF Investment
“Price Determination Date” the date, expected to be on or before Wednesday, March
19, 2025 and in any event no later than 12:00 noon on
Wednesday, March 19, 2025, on which the Offer Price is
to be fixed for the purposes of the Global Offering
“Principal Share Registrar” International Corporation Services Ltd.
“QIB” a qualified institutional buyer within the meaning of Rule
144A
“Regulation S” Regulation S under the U.S. Securities Act
“RMB” or “Renminbi” Renminbi, the lawful currency of China
“Rule 144A” Rule 144A under the U.S. Securities Act
“R&D” research and development
“SAFE” the State Administration of Foreign Exchange of the PRC
(̮ි၍ଣ҅)
“SAMR” the State Administration for Market Regulation of the
PRC (̹ఙ္ຖ၍ଣᐼ҅)
“SA T” State Administration of Taxation (೼ਕᐼ҅)
“Series A Preferred Share(s)” the series A-1 preferred share(s) of our Company with a
par value of US$0.0001 each
“Series A Preferred
Shareholder(s)”
the holder(s) of Series A Preferred Shares as detailed in
“History, Development and Corporate Structure”
“Series B Preferred Share(s)” the series B preferred share(s) of our Company with a par
value of US$0.0001 each
“Series B Preferred
Shareholder(s)”
the holder(s) of Series B Preferred Shares as detailed in
“History, Development and Corporate Structure”
DEFINITIONS
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“Series A Share Purchase
Agreement”
the share purchase agreement entered into between our
Company and the Series A Preferred Shareholders dated
November 7, 2018
“Series B Share Purchase
Agreement”
the share purchase agreement entered into between our
Company and the Series B Preferred Shareholders dated
January 8, 2021
“SFC” Securities and Futures Commission of Hong Kong
“SFO” or “Securities and Futures
Ordinance”
Securities and Futures Ordinance (Chapter 571 of the
Laws of Hong Kong), as amended, supplemented or
otherwise modified from time to time
“Share(s)” ordinary share(s) in the share capital our Company with
a par value of US$0.0001 each
“Shareholder(s)” holder(s) of our Share(s)
“Shareholders’ Agreement” the amended and restated shareholders agreement entered
into by the Company and Pre-IPO Investors on January 8,
2021
“Sherpa Healthcare Partners” our Pre-IPO Investors, including Sherpa Healthcare Fund
I, L.P . and Sherpa Healthcare Co-Investment Fund, L.P .
“Sofinnova” Sofinnova V enture Partners IX, L.P ., a limited partnership
established under the laws of the State of Delaware on
July 11, 2014, a Founding Shareholder of the Company
“Sophisticated Investor(s)” has the meaning ascribed to it under Chapter 2.3 of the
Guide for New Listing Applicants issued by the Stock
Exchange
“Share Schemes” the Equity Incentive Plan and the Post-IPO Share Award
Scheme
“Stabilization Manager” Morgan Stanley Asia Limited
“State Council” the State Council of the PRC ( ʕശɛ͏΍ձ਷਷ਕ৫)
“Stock Exchange” or
“Hong Kong Stock Exchange”
The Stock Exchange of Hong Kong Limited
DEFINITIONS
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“subsidiary” or “subsidiaries” has the meaning ascribed to it in section 15 of the
Companies Ordinance
“substantial shareholder(s)” has the meaning ascribed to it in the Listing Rules
“Takeovers Code” Code on Takeovers and Mergers and Share Buy-backs
issued by the SFC, as amended, supplemented or
otherwise modified from time to time
“Track Record Period” the periods comprising the two years ended December 31,
2023 and the nine months ended September 30, 2024
“Underwriters” the Hong Kong Underwriters and the International
Underwriters
“Underwriting Agreements” the Hong Kong Underwriting Agreement and the
International Underwriting Agreement
“U.S.” or “United States” the United States of America, its territories, its
possessions and all areas subject to its jurisdiction
“US dollars”, “U.S. dollars”,
“US$” or “USD”
United States dollars, the lawful currency of the United
States
“U.S. SEC” the Securities and Exchange Commission of the United
States
“U.S. Securities Act” the United States Securities Act of 1933, as amended, and
the rules and regulations promulgated thereunder
“VISEN BVI” VISEN Pharmaceuticals (BVI) Limited, a company
incorporated under the laws of the BVI on November 9,
2020, and a wholly-owned subsidiary of the Company
“VISEN HK” VISEN Pharmaceuticals HK Limited, a company
incorporated under the laws of Hong Kong on
November 13, 2018, and a wholly-owned subsidiary of
the Company
“VISEN Shanghai” VISEN Pharmaceuticals (Shanghai) Co., Ltd. (ᖹุ
(ɪऎ)ʮ̡), a company established in the PRC with
limited liability on February 15, 2019 and an indirectly
wholly-owned subsidiary of our Company
DEFINITIONS
–4 5–


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“VISEN Suzhou” VISEN Pharmaceuticals (Suzhou) Co., Ltd. (ᖹุ(ᘽ
ψ)ʮ̡), a company established in the PRC with
limited liability on June 11, 2021 and an indirectly
wholly-owned subsidiary of our Company
“VISEN Taiwan” VISEN Pharmaceuticals (Taiwan) Ltd. (ᖹุϞ
ʮ̡), a company established in Taiwan with limited
liability on December 28, 2021 and an indirectly wholly-
owned subsidiary of our Company
“Vivo Capital” refers to Vivo Plenilune IX Limited, a company
incorporated under the laws of the Cayman Islands on
September 11, 2018, a Founding Shareholder of the
Company. Vivo Capital, Vivo Capital IX (Cayman), LLC.
and Vivo Capital Fund IX (Cayman), L.P ., are our
Controlling Shareholder as a group
“White Form eIPO ” the application for Hong Kong Offer Shares to be issued
in the applicant’s own name, submitted online through
the designated website of the White Form eIPO Service
Provider, at www.eipo.com.hk
“White Form eIPO Service
Provider”
Computershare Hong Kong Investor Services Limited
“%” per cent
DEFINITIONS
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This glossary contains definitions of certain technical terms used in this document
in connection with us and our business. These may not correspond to standard industry
definitions, and may not be comparable to similarly terms adopted by other companies.
“ACH” Achondroplasia, a form of short-limbed dwarfism,
manifested by the disorder of bone growth that prevents
the changing of cartilage, particularly in the long bones
of the arms and legs, to bone
“AE” adverse event, any untoward medical occurrence in a
patient or clinical investigation subject administered a
pharmaceutical product and which does not necessarily
have a causal relationship with this treatment. An AE can
therefore be any unfavourable and unintended sign
(including an abnormal laboratory finding), symptom, or
disease temporally associated with the use of a medicinal
(investigational) product, whether or not related to the
medicinal (investigational) product
“AGV” annualized growth velocity
“AHV” annualized height velocity
“ANCOV A” analysis of covariance, a method to test the main and
interaction effects of categorical variables on a
continuous dependent variable, controlling for the effects
of selected other continuous variables, which co-vary
with the dependent
“antibody” a blood protein produced in response to and binding a
specific antigen. Antibodies bind non-chemically with
substances which the body recognizes as alien, such as
bacteria, viruses, and foreign substances in the blood
“biologics” class of drug products derived from a variety of natural
sources – human, animal, or microorganism – that may be
produced by biotechnology methods and other cutting-
edge technologies (in contrast to small molecule drugs
that are chemically synthesized). They can be composed
of sugars, proteins, or nucleic acids or complex
combinations of these substances, or may be living
entities, such as cells and tissues
GLOSSARY OF TECHNICAL TERMS
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“BLA” biologics license application used to apply for regulatory
approval to market and commercialize a biologic product
“CDE” Center for Drug Evaluation of NMPA (္ຖ၍ଣ
ᄲ൙ʕː), a division of the NMPA mainly
responsible for review and approval of IND and NDA
“CDMO” contract development and manufacturing organization
“clinical trial” or “clinical study” any investigation in human subjects intended to discover
or verify the clinical, pharmacological and/or other
pharmacodynamic effects of an investigational
product(s), and/or to identify any adverse reactions to an
investigational product(s), and/or to study absorption,
distribution, metabolism, and excretion of an
investigational product(s) with the object of ascertaining
its safety and/or efficacy
“C
max” highest or peak blood/plasma concentration
“CMC” chemistry, manufacturing, and controls processes in the
development, licensure, manufacturing, and ongoing
marketing of pharmaceutical products
“CNP” C-type natriuretic peptide, the paracrine element of the
natriuretic peptide axis which complements the endocrine
actions of atrial natriuretic peptide and brain natriuretic
peptide
“cohort” in epidemiology, refers to a group of people who share
experiences or states
“Core Product” our “core product” as defined under Chapter 18A of the
Listing Rules, namely lonapegsomatropin
“CRO” contract research organization, a company that provides
support to the pharmaceutical, biotechnology, and
medical device industries in the form of research services
outsourced on a contract basis
“CSO” contract sales organization, a company that provides
various services and solutions related to pharmaceutical
marketing and commercial activities under contracts with
pharmaceutical or biotech companies
GLOSSARY OF TECHNICAL TERMS
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“designated local CDMO” or
“WuXi Biologics”
WuXi Biologics (Shanghai) Co., Ltd. (Ҧஔ
ʮ̡), a limited liability company established in the
PRC on January 6, 2015, a wholly-owned subsidiary of
WuXi Biologics (Cayman) Inc. (ʮ̡),
an exempted company incorporated with limited liability
in the Cayman Islands on February 27, 2014, with its
shares being listed on the Main Board of the Stock
Exchange (HKEx stock code: 2269)
“disease-modifying therapy” a treatment that delays, slows, or reverses the progression
of a disease by targeting its underlying cause
“double-blind” a phase in clinical trial where neither the patients nor the
researchers know who is receiving a placebo and who is
getting the treatment in which the objective is primarily
to prevent bias and ensure the validity of the results
“endpoint” with respect to a clinical study or trial, the outcome that
is measured, whether referring to occurrence of disease,
symptom, sign or laboratory abnormality constituting a
target outcome, in which case “endpoint” will be
preceded by the outcome term, such as in “clinical
remission endpoint” or “maintenance therapy endpoint”
“FGFR3” fibroblast growth factor receptor 3. A FGFR3 gene is a
gene that makes a protein that is involved in cell division,
cell maturation, formation of new blood vessels, wound
healing, and bone growth, development, and
maintenance. A mutation in the FGFR3 gene may cause
the FGFR3 protein to become overactive in certain bone
disorders, genetic conditions, and cancers
“GAMA” government affairs and market access
“GCP” a standard for the design, conduct, performance,
monitoring, auditing, recording, analyses, and reporting
of clinical trials that provides assurance that the data and
reported results are credible and accurate, and that the
rights, integrity, and confidentiality of trial subjects are
protected
“GHD” growth hormone deficiency, a condition caused by
insufficient amounts of growth hormone in human body
GLOSSARY OF TECHNICAL TERMS
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“GLP” good laboratory practice, a quality system of
management controls for research laboratories and
organizations to ensure the uniformity, consistency,
reliability, reproducibility, quality, and integrity of
products in development for human or animal health
“GMP” good manufacturing practice, a system for ensuring that
products are consistently produced and controlled
according to quality standards. It is designed to minimize
the risks involved in any pharmaceutical production that
cannot be eliminated through testing the final product
“HCP” healthcare professional
“hGH” human growth hormone, a small protein that is made by
the pituitary gland and secreted into the bloodstream.
hGH production is controlled by a complex set of
hormones produced in the hypothalamus of the brain and
in the intestinal tract and pancreas
“homeostasis” a state of balance among all the body systems needed for
the body to survive and function correctly. In
homeostasis, body levels of acid, blood pressure, blood
sugar, electrolytes, energy, hormones, oxygen, proteins,
and temperature are constantly adjusted to respond to
changes inside and outside the body, to keep them at a
normal level
“HP” Hypoparathyroidism, a syndrome of abnormal calcium
and phosphorus metabolism caused by underproduction
or defective function of PTH
“IGF-1” insulin-like growth factor-1, a form of insulin-like
growth factor which is a protein made by the body that
stimulates the growth of many types of cells. Insulin-like
growth factor is similar to insulin, a hormone made in the
pancreas
“Import BLA” biologics license application used to apply for regulatory
approval to market and commercialize a biologic product
manufactured and imported from overseas
“IND” investigational new drug or investigational new drug
application, also known as clinical trial application in
China
GLOSSARY OF TECHNICAL TERMS
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“INN” International Nonproprietary Names, which identify
pharmaceutical substances or active pharmaceutical
ingredients. Each INN is a unique name that is globally
recognized and is public property
“indication” a known disease or condition/symptoms which makes a
particular prevention, diagnosis, or medicinal product
advisable
“LAGH” long-acting growth hormone
“MAD” multiple-ascending doses escalation is a study to obtain
drug tolerance data, which is generally carried out after
completing a single-ascending doses escalation trial in
which the drug first enters the human body in order to
determine the maximum tolerated dose of multiple doses
in humans
“MAA” Marketing Authorization Application, an application
made to a European regulatory authority for approval to
market a medicine within the European Union
“Local BLA” biologics license application used to apply for regulatory
approval to market and commercialize a biologic product
manufactured locally
“MoA” mechanism of action, which, in pharmacology, refers to
the specific biochemical interaction through which a drug
substance produces its pharmacological effect. A
mechanism of action usually includes mention of the
specific molecular targets to which the drug binds, such
as an enzyme or receptor
“NPR-B receptor” Natriuretic Peptide Receptor B receptor, a guanylyl
cyclase receptor encoded on the ninth chromosome in
humans that is activated by CNP . It is expressed at high
levels in the brain, heart, bones, ovaries, and lungs
“NPR-C receptor” Natriuretic Peptide Receptor C receptor, a non-guanylyl
cyclase receptor that is coupled to adenylyl cyclase
inhibition or phospholipase C activation through
inhibitory guanine nucleotide regulatory protein
GLOSSARY OF TECHNICAL TERMS
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“OLE” open-label extension, a type of clinical study that
typically follows a double-blind randomized placebo
controlled trial of a new drug in which the objective is
primarily to gather information about safety and
tolerability of the new drug in long-term, day to day use
“p” or “p-value” with respect to clinical trials or studies, the probability of
obtaining a result at least as extreme as the one that was
actually observed in the biological or clinical experiment
or epidemiological study, given that the null hypothesis
(which is the hypothesis to be nullified that there is no
association between the investigated factors or
characteristics) is true. A result is said to be “statistically
significant” if there is the likelihood that a relationship
between two or more variables is caused by something
other than chance (so it allows for rejection that the null
hypothesis is true) whereas “clinically meaningful” is the
practical importance of a treatment effect – whether it has
a real genuine, palpable, noticeable effect on daily life
“PEG” polyethylene glycol, a polymer made by joining
molecules of ethylene oxide and water together in a
repeating pattern. PEG can be a liquid or a waxy solid
“PEGylation” a process through which PEG chains are conjugated to
proteins (therapeutic proteins), peptides, or any
molecule, and the resulting substance is “PEGylated.”
Through the PEGylation process, the molecular mass of
the therapeutic protein is increased. Therefore, it guards
the therapeutic protein from proteolytic enzymes and
degradation of the protein
“PGHD” pediatric growth hormone deficiency
“pharmacodynamics” or “PD” the study of how a drug affects an organism, which,
together with pharmacokinetics, influences dosing,
benefit, and adverse effects of the drug
“pharmacokinetics” or “PK” the study of how the body interacts with administered
substances for the entire duration of exposure. The four
main parameters generally examined by this field include
absorption, distribution, metabolism, and excretion
(ADME)
GLOSSARY OF TECHNICAL TERMS
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“Phase 1” it is usually a human pharmacological test during early
clinical studies. The first administration of the
investigational product to humans is at this stage. These
studies may be performed in healthy volunteers or in
patient populations affected by a condition or disease,
depending on the characteristics of the drug and the
purpose of the development program. Such studies are
generally intended to address one or more of the
following: preliminary safety and tolerability
assessments, pharmacokinetics, pharmacodynamics, and
early determination of drug activity
“Phase 2” to investigate the safety and efficacy of the drug in
specific patient groups as an exploratory study. In
addition, the objectives of the exploratory studies were to
refine the effective dose and regimen, refine the
definition of the target population, ensure robustness of
the drug safety profile, and include evaluation of
potential study endpoints adopted in subsequent studies.
Exploratory studies can provide information on
identifying and identifying factors that influence
treatment effectiveness, combined with modeling and
simulation, and help support subsequent confirmatory
study designs
“Phase 3” also called confirmatory studies, they are intended to
confirm preliminary evidence accumulated in early
clinical studies about the safety and effectiveness of a
drug in the intended use and population. Confirmatory
studies are generally designed to provide a sufficient
basis for marketing approval of a drug and to provide
adequate instructions for the use of the drug and
officially published drug product information
“pivotal trial” or “pivotal study” a clinical study seeking to demonstrate the efficacy of a
new drug in order to obtain its marketing approval by
regulatory authorities
“popPK” population pharmacokinetics, popPK analysis is a well-
established, quantitative method that can quantify and
explain the variability in drug concentrations among
individuals
GLOSSARY OF TECHNICAL TERMS
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“pre-clinical study” also called non-clinical study. The nonclinical assessment
usually includes toxicology, carcinogenicity,
immunogenicity, pharmacology, pharmacokinetics, and
other evaluations to support clinical studies (and may
encompass evidence generated in in vivo and in vitro
models, and by modelling and simulation)
“primary endpoint” with respect to a clinical study or trial, the main
predefined result that is measured at the end of a study
(e.g., the number of deaths or the difference in survival
between the treatment group and the control group)
“PRO” patient reported outcome
“PTH” Parathyroid hormone, a polypeptide that is synthesized
and cleaved into an active form within the parathyroid
gland
“receptor” a region of tissue, or a molecule in a cell membrane,
which responds specifically to a particular signal, that is
any of a neurotransmitter, hormone, antigen, or other
substance. “Receptor modulator” or a “selective receptor
modulator” (SRM) is a type of drug that has different
effects in different tissues, as it may behave as an agonist
in some tissues but as an antagonist in others
“renal” of or pertaining to the kidney, as with renal pelvis cancer
“SAD” single-ascending dose (SAD), a study in which the
maximum recommended starting dose (MRSD) is used as
the starting dose for clinical administration when the
drug first enters the human body, and the dose is
gradually increased in the form of a single dose to obtain
the maximum tolerated dose in humans
“SAE” serious adverse event, any untoward medical occurrence
that at any dose: results in death, is life-threatening,
requires inpatient hospitalization or prolongation of
existing hospitalization, results in persistent or
significant disability/incapacity, or is a congenital
anomaly/birth defect
“SDS” standard deviation scores
GLOSSARY OF TECHNICAL TERMS
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“secondary endpoint” with respect to a clinical study or trial, a secondary
objective that was measured. For example, a drug
designed to prevent allergy-related deaths might also
have a measure of whether quality of life is improved
“SMO” site management organization, an organization that
contractually provides clinical trial related services to a
study sponsor, CRO or clinical investigator
“standard of care” treatment that is accepted by medical experts as a proper
treatment for a certain type of disease and that is widely
used by healthcare professionals. It is also called best
practice, standard medical care, and standard therapy
“TEAE” treatment-emergent adverse events, an AE that emerges
during treatment having been absent pre-treatment, or
worsens relative to the pre-treatment state
“tolerability” the degree to which overt AEs of a drug can be tolerated
by a patient. Tolerability of a particular drug can be
discussed in a general sense, or it can be a quantifiable
measurement as part of a clinical study
GLOSSARY OF TECHNICAL TERMS
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Certain statements in this document are forward-looking statements that are, by their
nature, subject to significant risks and uncertainties. Any statements that express, or involve
discussions as to, expectations, beliefs, plans, objectives, assumptions, future events, or
performance (often, but not always, through the use of words or phrases such as “will,”
“expect,” “anticipate,” “estimate,” “believe,” “going forward,” “ought to,” “may,” “seek,”
“should,” “intend,” “plan,” “projection,” “could,” “vision,” “goals,” “aim,” “aspire,”
“objective,” “target,” “schedules,” and “outlook”) are not historical facts, are forward-looking
and may involve estimates and assumptions and are subject to risks (including but not limited
to the risk factors detailed in this document), uncertainties and other factors some of which are
beyond our control and which are difficult to predict. Accordingly, these factors could cause
actual results or outcomes to differ materially from those expressed in the forward-looking
statements.
Our forward-looking statements have been based on assumptions and factors concerning
future events that may prove to be inaccurate. Those assumptions and factors are based on
information currently available to us about the businesses that we operate. The risks,
uncertainties and other factors, many of which are beyond our control, that could influence
actual results include, but are not limited to:
 our operations and business prospects;
 our business and operating strategies and our ability to implement such strategies;
 our ability to develop and manage our operations and business;
 our ability to control costs and expenses;
 our expectations regarding the potential market size and the size of the patient
populations for our drug candidates, if approved for commercial use;
 our expectations regarding the potential advantages of our drug candidates over
existing therapies;
 our ability to maintain good relationships with business partners;
 the actions and developments of our competitors;
 changes to regulatory and operating conditions in the industry and geographical
markets in which we operate;
 our ability to obtain, maintain, protect and enforce intellectual and proprietary rights
for our drug candidates;
 our development plans with respect to our drug candidates;
FORW ARD-LOOKING STATEMENTS
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 our ability to develop, acquire and advance drug candidates into, and successfully
complete, clinical trials;
 the timing or likelihood of regulatory filings and approvals for our drug candidates;
 the commercialization of our drug candidates, if approved;
 our commercialization, marketing and manufacturing capabilities of our drug
candidates and associated devices;
 developments and projections relating to our competitors and our industry; and
 all other risks and uncertainties described in “Risk Factors.”
Since actual results or outcomes could differ materially from those expressed in any
forward-looking statements, we strongly caution investors against placing undue reliance on
any such forward-looking statements. Any forward-looking statement speaks only as of the
date on which such statement is made, and, except as required by the Listing Rules, we
undertake no obligation to update any forward-looking statement to reflect events or
circumstances after the date on which such statement is made or to reflect the occurrence of
unanticipated events. Statements of, or references to, our intentions or those of any of our
Directors are made as of the date of this document. Any such intentions may change in light
of future developments.
All forward-looking statements in this document are expressly qualified by reference to
this cautionary statement.
FORW ARD-LOOKING STATEMENTS
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We are a biotechnology company seeking to list on the Stock Exchange under
Chapter 18A of the Listing Rules on the basis that we are unable to meet the requirements
under Rule 8.05(1), (2) or (3) of the Listing Rules. Given the nature of our industry, there
are a number of risks involved in our operations, many of which are beyond our control.
As a result of these risks, you may lose all of your investments in our Company.
You should carefully consider all of the information set out in this document before
making an investment in the Shares, including the risks and uncertainties described below
in respect of our business and our industry and the Global Offering. You should pay
particular attention to the fact that we are a company incorporated in the Cayman Islands
and that our principal operations are conducted in China and are governed by a legal
and regulatory environment that in some respects differs from what prevails in other
countries. Our business could be affected materially and adversely by any of these risks.
We believe there are certain risks and uncertainties involved in our operations, some of
which are beyond our control. We have categorized these risks and uncertainties into: (i) key
risks related to our business, business operations, intellectual property, regulatory approval of
our drug candidates, commercialization and financial prospects; (ii) other risks related to our
limited operating history, financial position and need for additional capital; (iii) other risks
related to the development of our drug candidates; (iv) other risks related to our intellectual
property; (v) other risks related to obtaining regulatory approval of our drug candidates and
other legal compliance matters; (vi) other risks related to manufacturing and commercialization
of our drug candidates; (vii) risks related to our business operations; and (viii) risks related to
the Global Offering.
Additional risks and uncertainties that are presently not known to us or not expressed or
implied below or that we currently deem immaterial could also have a material adverse effect
on our business, financial condition and operating results. Y ou should consider our business
and prospects in light of the challenges we face, including the ones discussed in this section.
KEY RISKS RELATED TO OUR BUSINESS, BUSINESS OPERATIONS,
INTELLECTUAL PROPERTY, REGULATORY APPROV AL OF OUR DRUG
CANDIDATES, COMMERCIALIZATION AND FINANCIAL PROSPECTS
These are the key risks that are specific and critical to biopharmaceutical companies in
general and to us specifically.
RISK FACTORS
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Our rights to develop, manufacture and commercialize our drug candidates are subject to the
terms and conditions of licenses granted to us by Ascendis Pharma. If we fail to comply with
our obligations in our Exclusive License Agreements with Ascendis Pharma, we could lose
the rights to develop, manufacture and commercialize our drug candidates and be required
to pay monetary damages, which could materially and adversely affect our business
operations.
We rely on the exclusive licenses granted to us by Ascendis Pharma to develop,
manufacture and commercialize our drug candidates in China (including Hong Kong, Macau
and Taiwan). We also rely on licenses to certain patent rights from Ascendis Pharma that are
important or necessary to the development of our drug candidates, as we do not currently own
all of the underlying intellectual properties and the transfer of patents related to these drug
candidates will occur only upon the first regulatory approval for marketing of the
corresponding drug candidate. See “Business – Collaborations – Exclusive License
Agreements with Ascendis Pharma” for more details regarding our license agreements with
Ascendis Pharma. As a result, our rights are subject to the continuation of, and compliance with
the terms of, those agreements. If we fail to comply with our obligations under our current or
future license agreements with Ascendis Pharma, Ascendis Pharma may have the right to
terminate these agreements and, upon the effective date of such termination, may have the right
to terminate our exclusive rights or all of our rights and acquire rights to certain of our
developed intellectual property. If Ascendis Pharma terminates any license we rely upon, we
might not be able to develop, manufacture or commercialize any drug or drug candidate related
to the intellectual property licensed under these agreements and we may face other additional
penalties or costs. In such case, we may have to negotiate new agreements or agreement
amendments with terms less favorable to us including, potentially, licenses that are non-
exclusive, if we are able to do so at all, and other parties, including our competitors, may be
able to gain access to the applicable licensed technology. We may also face claims for monetary
damages or other penalties. While we would expect to exercise all rights and remedies
available to us, including seeking to cure any breach we commit if permitted, and otherwise
seek to preserve our rights under the intellectual property rights licensed to us, we may not be
able to do so in a timely manner, at an acceptable cost or at all. If Ascendis Pharma breaches
our license agreements, we may not be able to enforce such agreements or obtain remedies that
are sufficient or adequate.
Our licenses may not include rights to all intellectual property relevant to our drug
candidates, and disputes may arise in these Exclusive License Agreements, including (i) the
scope of rights granted under the license agreements and other interpretation-related issues; (ii)
the extent to which the conduct of our business, including any relevant technology and
processes, infringe, misappropriate or otherwise violate the intellectual property right of the
licensor that is not subject to the license agreements; (iii) the sublicensing of patent and other
intellectual property or proprietary rights under the license agreements; (iv) our diligence
obligations under the license agreements and what activities satisfy such obligations; and (v)
the inventorship and ownership of patents, inventions, know-how and other intellectual
property and proprietary rights resulting from activities performed by us and/or our
counterparties.
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The resolution of any dispute relating to such agreements could narrow the scope of our
rights to the relevant intellectual property or technology, which could have a material adverse
effect on our business, financial condition, results of operations, and prospects. We may need
to obtain additional licenses from Ascendis Pharma, which may not be available on an
exclusive basis, commercially reasonable terms or at all, or expend significant time and
resources to redesign our drug candidates or the methods for manufacturing them, all of which
may not be feasible on a technical or commercial basis.
Furthermore, in the future, Ascendis Pharma may rely on third-party consultants or
collaborators or on funds, resources or expertise from third parties, including governmental
bodies, such that Ascendis Pharma may not be the sole and exclusive owners of the patents that
we in-license. If other third parties have ownership rights to our in-licensed patents, they may
be able to license such patents to our competitors or other third parties, who could then market
equivalent or substantially equivalent products and technologies. In addition, if Ascendis
Pharma has not obtained adequate rights and licenses from these third parties, we may need to
obtain additional rights from these third parties, which might not be available on reasonable
terms or at all, or we could be prevented from developing and commercializing, or face
competition with respect to, the related drug candidates.
Over time, there exists possibility that we seek additional rights to intellectual property
from Ascendis Pharma and, in connection with the related negotiations, we may agree to amend
our existing licenses in a manner that are more favorable to Ascendis Pharma.
In addition, there exists possibility that we need to obtain additional licenses from third
parties to advance our research or development or allow commercialization of our current and
any future drug candidates, and we cannot assure you that third-party patents or other
intellectual property or proprietary rights which might be enforced against our current and any
future drug candidates in the absence of such a license do not exist. We may fail to obtain any
of these licenses on commercially reasonable terms, or at all. Other companies in our industry
may have much greater resources than us and be able to effectively compete with us for access
to licensed intellectual property. Even if we are able to obtain a license, it may be
non-exclusive, thereby giving our competitors and other third parties access to the same
technologies licensed to us. In that event, we may be required to expend significant time and
resources to develop or in-license replacement technology. If we are unable to do so, we may
be unable to develop or commercialize the affected drug candidates, which could materially
harm our business and the third parties owning such intellectual property rights could seek
either an injunction prohibiting our sales, or, with respect to our sales, an obligation on our part
to pay royalties and/or other forms of compensation. Any of the foregoing events could have
a material adverse effect on our competitive position, business, financial conditions, results of
operations, and prospects.
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We expect to procure the Core Product from Ascendis Pharma for the commercial supply
until 2028 following our anticipated commercialization activities in late 2025 after BLA
approval, which may expose us to risks such as potential disruptions in the supply chain and
a lack of control over the quality and timing of product supply, and may adversely affect our
business and profitability.
We expect to procure the Core Product from Ascendis Pharma for the commercial supply
until 2028 following our anticipated commercialization activities in late 2025 after BLA
approval. In anticipation of the potential BLA approval and subsequent commercial launch of
our Core Product, we entered into a commercial supply agreement with Ascendis Pharma in
October 2023, pursuant to which we agreed to purchase, and Ascendis Pharma agreed to sell,
lonapegsomatropin drug package, auto-injectors and additional certain drug items intended for
marketing display purposes. For auto-injectors to be purchased from Ascendis Pharma, the
import medical device registration application for the auto-injector was submitted by a
third-party marketing authorization holder to the NMPA in June 2023 and has been approved
in April 2024. Since the Core Product is used exclusively with the auto-injector produced by
such marketing authorization holder, we expect to rely on its auto-injector supply before we
establish our collaborative local manufacturing capability with local CDMO. See “Business –
Commercial Supply and Manufacturing – Step 1: Commercial Drug Procurement from
Importation” for details. Our anticipated reliance on Ascendis Pharma and its manufacturing
suppliers (collectively, the commercial suppliers) in the short term may expose us to risks
including but not limited to the following:
 our commercial suppliers may increase their prices over time, which can directly
impact our cost of goods sold and reduce profitability;
 our commercial suppliers may be subject to potential issues such as production
disruptions, labor strikes or financial difficulties, which may disrupt the supply
chain and lead to delays in product availability; and
 we may have less control over the quality of the products supplied by our
commercial suppliers. Inconsistent or inferior product quality may in turn lead to
product recalls, product returns or exchanges, product liability, increased costs and
damage to our reputation, thereby adversely affect our business, financial condition
and results of operations.
Any of these occurrences may result in higher costs or adversely affect our
commercialization plan, business operations and profitability.
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None of our drug candidates has received a marketing approval in China (including Hong
Kong, Macau and Taiwan). If we are unable to advance our drug candidates through clinical
development, obtain regulatory approval and/or ultimately commercialize our drug
candidates, or experience significant delays in doing so, our business and profitability will
be materially harmed.
Our business will depend on the successful development, regulatory approval and
commercialization of our drug candidates for the treatment of patients with our currently
targeted and new indications. Our Core Product, lonapegsomatropin, has received the
acceptance letter for its BLA filing from the NMPA after the completion of Phase 3 pivotal trial
in China and the other two of our pipeline drug candidates are being studied in clinical trials
in China. However, we make no guarantee that we will be able to obtain additional regulatory
approvals for our drug candidates in a timely manner, or at all, or advance any of our drug
candidates through the clinical development.
The developmental success of our drug candidates will depend on several factors,
including but not limited to the successful completion of clinical trials or studies, receipt of
regulatory approvals from applicable regulatory authorities for planned clinical trials, future
clinical trials or drug registrations, establishing adequate manufacturing capabilities,
commercialization of our existing drug candidates with respect to current and new indications
and compliance with all relevant safety requirements. If we do not achieve one or more of these
in a timely manner or at all, due to reasons either within or outside our control, including a
change in our development strategy, we may not successfully obtain regulatory approval for
our drug candidates, which would materially harm our business and may prevent us from
generating sufficient revenues and cash flows to continue our operations. As a result, our
financial condition, results of operations and prospects would be materially and adversely
harmed.
Our drug candidates may cause undesirable AEs or have other properties that could delay
or prevent their regulatory approval, limit the commercial profile of an approved label, or
result in significant negative consequences following regulatory approval, if any. If any of
our drug candidates receives marketing approval and subsequently causes undesirable side
effects, the ability to market the drug candidates could be compromised.
Although results from the global and China clinical development of our drug candidates,
lonapegsomatropin, TransCon CNP (navepegritide) and palopegteriparatide, have supported
that these drug candidates are generally safe and well-tolerated, there is no guarantee that our
current or future drug candidates would not cause undesirable side effects. Any such
undesirable side effects could potentially cause us or regulatory authorities to interrupt, delay
or halt clinical trials and could result in a more restrictive label or the delay or denial of
regulatory approval by the NMPA or similar authorities. In the event that trials conducted by
us or Ascendis Pharma reveal a high and unacceptable severity and prevalence of side effects,
such trials could be suspended or terminated and the NMPA or similar regulatory authorities
could order us to cease further development of or deny approval of our drug candidates for any
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or all targeted indications. The drug-related side effects could affect patient enrollment or the
ability of enrolled patients to complete the trial or result in potential product liability claims.
Any of these occurrences may harm our business, financial condition and prospects
significantly.
In addition, in the event that any of our drug candidates receives regulatory approval and
we or others later identify undesirable side effects caused by one of our products, a number of
potentially significant negative consequences could occur, including:
 regulatory authorities may withdraw their approval of the product or seize the
product;
 we may be required to recall the product;
 additional restrictions may be imposed on the marketing of the particular product or
the manufacturing processes for the product or any component thereof, including
requirements such as patient education, certification of health care professionals or
specific monitoring;
 we may be subject to fines, injunctions or the imposition of civil or criminal
penalties;
 regulatory authorities may require the addition of labeling statements, such as a
warning or a contraindication;
 we could be sued and held liable for harm caused to patients;
 the product may become less competitive; and
 we may suffer reputational damage.
Any of the foregoing events could prevent us from achieving or maintaining market
acceptance of a particular drug candidate, if approved, and could result in the loss of significant
revenue to us, which would harm our results of operations and business.
We may not be able to identify, discover or in-license new products or drug candidates to
successfully expand our drug candidate portfolio, which could materially and adversely
affect our future growth and prospects.
Although a substantial amount of our effort will focus on the continued clinical testing,
potential approval, and commercialization of our existing drug candidates, the success of our
business in the long-term depends in part upon our ability to identify, in-license, discover,
develop, or commercialize additional drug candidates to expand our drug candidate portfolio.
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Our research programs or licensing efforts may fail to identify, discover or in-license new
products or drug candidates for clinical development and commercialization for a number of
reasons, including, without limitation, the following:
 our research or business development methodology or search criteria and process
may be unsuccessful in identifying potential drug candidates; and
 our potential drug candidates may be shown to have harmful side effects or may
have other characteristics that may make the products unmarketable or unlikely to
receive marketing approval; and we may lack sufficient human and financial
resources to identify additional therapeutic opportunities for our drug candidates or
to develop suitable potential drug candidates through internal research programs,
which would limit our ability to diversify and expand our drug candidate portfolio.
Accordingly, there can be no assurance that we will be able to identify new products or
drug candidates or additional therapeutic opportunities for our existing drug candidates or to
develop suitable potential drug candidates through internal research programs. We may
therefore not be able to successfully expand our drug candidate portfolio, which could
materially adversely affect our future growth and prospects. We may focus our efforts and
resources on potential drug candidates or other potential programs that ultimately prove to be
unsuccessful.
Our success depends upon our and Ascendis Pharma’s ability to obtain, maintain, protect
and enforce intellectual property protection for our drug candidates and their underlying
technologies. If we or Ascendis Pharma are unable to obtain and maintain intellectual
property protection for our drug candidates, or if the scope of such intellectual property
rights obtained is not sufficiently broad, third parties could develop and commercialize
products and technologies similar or identical to ours and compete directly against us, and
our ability to successfully commercialize any product or technology may be adversely
affected. The patents and patent applications in-licensed to us covering one or more of our
drug candidates could be found invalid or unenforceable if challenged in court or before a
regulatory authority.
Our success depends in significant part on Ascendis Pharma’s ability to establish and
maintain patent, trade secret and other intellectual property and proprietary right protection
with respect to the drug candidates we plan to develop, and on our ability to develop these drug
candidates and commercialize the products resulting therefrom without infringing,
misappropriating or otherwise violating the intellectual property or proprietary rights of others.
In the future, we may apply for our own patents with claims covering our technologies,
processes and drug candidates when and where we deem it appropriate to do so. There can be
no assurance that the claims of any existing or future patent application that we or Ascendis
Pharma file will issue as a patent, and if it does issue or has issued, will exclude others from
making, using or selling our existing or future drug candidates or products similar or identical
to those drug candidates or otherwise provide us with any meaningful competitive advantage.
We also rely on trade secrets to protect aspects of our business, especially where we or
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Ascendis Pharma do not believe patent protection is appropriate or feasible. However, trade
secrets are difficult to protect and even with trade secret protection, companies may be able to
independently develop equivalent knowledge, methods and know-how. As a result, in
jurisdictions where we or Ascendis Pharma have not sought and do not seek patent protection,
third parties may be able to manufacture and sell products similar or identical to ours in the
future without our permission and compete directly against us, and we may not be able to stop
them from doing so, even if our products are protected by trade secrets.
Even with respect to issued patents, issuance is not conclusive as to their scope, validity
or enforceability, and the patents we have rights to may be challenged or invalidated in the
courts or patent offices in China or other jurisdictions. For example, if we or Ascendis Pharma
were to initiate legal proceedings against a third party to enforce a patent covering any of our
drug candidates, the defendant could counterclaim that the patent is invalid or unenforceable.
In patent litigation, defendant counterclaims alleging invalidity or unenforceability are
commonplace. Grounds for a validity challenge could be an alleged failure to meet any of
several statutory requirements, for example, lack of novelty, obviousness or non-enablement.
Grounds for an unenforceability assertion could be an allegation that someone connected with
prosecution of the patent withheld relevant information from the applicable intellectual
property office, or made a misleading statement or committed other inequitable conduct, during
prosecution. Mechanisms for challenging patents include re-examination, post-grant review,
interference, derivation, opposition, invalidation and other proceedings. The outcome
following legal assertions of invalidity and unenforceability is unpredictable. With respect to
the validity question, for example, we cannot be certain that there is no invalidating prior art
of which we or Ascendis Pharma and the patent examiner were unaware during prosecution. If
we or Ascendis Pharma were not to prevail on a legal assertion of invalidity or
unenforceability, we would lose at least part, and perhaps all, of the patent protection on a drug
candidate. Even if a defendant does not prevail on a legal assertion of invalidity and/or
unenforceability, our patent claims may be construed in a manner that would limit our or
Ascendis Pharma’s ability to enforce such claims against the defendant and others. Any efforts
to defend intellectual property rights against such challenges are also likely to be costly, and
we or Ascendis Pharma may not have sufficient funds to defend against any such claims or may
otherwise decide not to defend them for commercial or other reasons. Such challenges may
result in patent claims being narrowed, invalidated or held unenforceable, in whole or in part,
which could limit our ability of or prevent us from stopping others from using or
commercializing similar or identical technology and drug candidates, or limit the duration of
the patent protection of our technology and drug candidates.
With respect to patent rights, we do not know whether any of the pending patent
applications to which we currently or in the future will have rights will result in the issuance
of patents that effectively protect our drug candidates, or if current or future issued patents will
effectively prevent others from developing and commercializing technologies, processes and
products similar or identical to ours and competing directly against us. Publications of
discoveries in the scientific literature often lag behind the actual discoveries. Therefore, we
cannot be certain that we or Ascendis Pharma or any future licensors were the first to make or
file on the inventions claimed in our current or future owned or licensed patents or pending
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patent applications. There is also no assurance that all of the potentially relevant prior art
relating to the patents and patent applications covering our drug candidates has been identified
and disclosed to the relevant patent office during the prosecution of the related patent
application, and such prior art could be used by a third party to challenge the validity or
enforceability of such patents, should they issue, or prevent a patent from issuing from a
pending patent application. Although we seek to enter into non-disclosure and confidentiality
agreements with parties who have access to confidential or patentable aspects of our R&D
output, such as our employees, contractors, collaborators and CROs, any of these parties may
breach the agreements and disclose such output before a patent application is filed, thereby
jeopardizing our ability to seek patent protection.
Any changes we make to our drug candidate or any future drug candidates, including
formulations that may be required for commercialization or that cause them to have what we
view as more advantageous properties, may not be covered by our patents and patent
applications, and we may be required to file new patent applications and/or seek other forms
of protection for any such altered drug candidates if any such protection is available. The
patent landscape surrounding the technology underlying our current and any future drug
candidates is crowded, and there can be no assurance that we would be able to secure patent
protection that would adequately cover an alternative to our current or any future drug
candidates.
In addition, the patent prosecution process is expensive, time-consuming and complicated
and we and Ascendis Pharma may not be able to prepare, file, prosecute and maintain all
necessary or desirable patent applications at a reasonable cost or in a timely manner. It is also
possible that we or Ascendis Pharma will fail to identify patentable aspects of inventions before
it is too late to obtain patent protection for them. Similar to the patent rights of other
biopharmaceutical companies, the scope, validity and enforceability of our patent rights
generally are highly uncertain and involve complex legal and factual questions. The issuance
of a patent is not conclusive as to its inventorship, scope, validity or enforceability, and our
patents may be challenged in the courts or patent offices in China or elsewhere. Our and
Ascendis Pharma’s pending and future patent applications may not result in patents being
issued that protect our drug candidates, their underlying technologies, or products resulting
therefrom, in whole or in part, or that effectively prevent others from commercializing
competitive technologies and products. The patent examination process may require us or
Ascendis Pharma to narrow the scope of the claims of pending and future patent applications,
which would limit the scope of patent protection that is obtained, if any. Our and Ascendis
Pharma’s patent applications cannot currently prevent third parties from applying the
technology that is claimed in such applications unless and until a patent is issued from such
applications, and then only to the extent the claims that issued are broad enough to cover the
technology being practiced by those third parties.
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Claims that our drug candidates or the exploitation of our products in the future infringe
upon, misappropriate or otherwise violate the patents or other intellectual property or
proprietary rights of third parties could result in costly litigation, the outcome of which
would be uncertain and could have a material adverse effect on our business, or could
require substantial time and monetary expenditure to resolve, even if litigation is avoided.
Our commercial success depends upon our ability to develop, manufacture, market, and
sell any drug candidates without infringing, misappropriating, or otherwise violating the
intellectual property and proprietary rights of third parties. We cannot guarantee that our drug
candidates or the sale or use of our future products do not and will not in the future infringe,
misappropriate or otherwise violate third-party patents or other intellectual property or
proprietary rights. Litigations involving patents and other intellectual property rights are
common in the biotechnology and biopharmaceutical industries. Numerous issued patents and
pending patent applications owned by third parties exist in the fields in which we are
developing drug candidates. As the biotechnology and biopharmaceutical industries expand
and more patents are issued, the risk increases that our drug candidates may give rise to claims
of infringement of the patent rights of others. Third parties may also allege that we
misappropriated their trade secrets, or that we are otherwise violating their intellectual property
or proprietary rights, whether with respect to the manner in which we have conducted our
research or development, or with respect to the sale, use or manufacture of the drug candidates
we have developed or are developing. Such third parties might resort to litigation against us
or Ascendis Pharma or other parties we have agreed to indemnify.
It is also possible that we or Ascendis Pharma have failed to identify, or may in the future
fail to identify, relevant patents or patent applications held by third parties with claims to
compositions, materials, formulations, methods of manufacture or methods for treatment
related to the use or manufacture of our drug candidates. Because patent applications can take
many years to issue, there may be pending patent applications that we are not aware of and
which may later result in issued patents that our drug candidates may infringe. We or Ascendis
Pharma also may have incorrectly concluded, or may in the future incorrectly conclude, that
third-party patents are invalid or that our activities do not infringe, misappropriate or otherwise
violate a third party’s intellectual property. In addition, third parties may obtain patents in the
future and claim that the development, manufacture or commercialization of our drug
candidates infringes upon these patents. If any third-party patents were held by a court of
competent jurisdiction to cover our drug candidates, our manufacturing process or any
molecules formed during the manufacturing process, any final drug itself, the holders of any
such patents may be able to prevent us from developing or commercializing such drug
candidates unless we obtain a license under the applicable patents or until such patents expire
or are finally determined to be invalid or unenforceable. Such a license may not be available
on commercially reasonable terms or at all. Even if we were able to obtain a license, the rights
may be non-exclusive, which could result in our competitors or other third parties gaining
access to the same intellectual property. Ultimately, we could be prevented from
commercializing a drug candidate, or be forced, by court order or otherwise, to cease some or
all aspects of our business operations, if, as a result of actual or threatened patent or other
intellectual property claims, we are unable to enter into licenses on acceptable terms.
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Even if we believe third-party intellectual property claims are without merit, there is no
assurance that a court would find in our favor on questions of infringement, validity,
enforceability, or priority. In the event of a successful claim of infringement, misappropriation
or other violation against us, we may have to pay substantial damages and attorneys’ fees in
the case of willful infringement, obtain one or more licenses from third parties, pay royalties
or redesign our infringing drug candidates, which may be impossible or require substantial time
and monetary expenditure. Third parties who bring successful claims against us for
infringement, misappropriation or other violation of their intellectual property or proprietary
rights may obtain injunctive or other equitable relief, which could prevent us from developing
and commercializing one or more of our drug candidates. Defending against claims of
infringement, misappropriation or other violations of patents, intellectual property rights or
proprietary rights of third parties, regardless of merit or outcome, would involve substantial
expense, be time-consuming and distract our management and employees, and our adversaries
may have the ability to dedicate substantially greater resources to prosecuting these legal
actions than we can. Uncertainties resulting from the initiation and continuation of patent
litigation, trade secret litigation or other intellectual property proceedings could have a
material adverse effect on our ability to compete in the marketplace. Any of the foregoing
could have a material adverse effect on our business, financial condition, results of operations
and prospects.
Our in-licensed patents and patent applications or any patents and patent applications that
we own or in-license in the future may be subject to priority disputes or to inventorship
disputes and similar proceedings. If we or our licensors are unsuccessful in any of these
proceedings, we may be required to obtain licenses from third parties, which may not be
available on commercially reasonable terms or at all, or to cease the development,
manufacture and commercialization of one or more of our drug candidates.
Although we are not currently aware of any pending challenges, we, Ascendis Pharma or
any future licensors may be subject to claims that former employees, collaborators or other
third parties have an interest in the intellectual property we use in our business, whether as an
inventor, co-inventor or otherwise, including derivation, interference or other proceedings
brought or declared in applicable patent offices. Litigation may be necessary to defend against
these and other claims challenging inventorship or ownership of our owned or in-licensed
patents and other intellectual property. Even if we are successful in defending against any such
claims, it could result in substantial costs and be a distraction to our management and other
employees. If we or Ascendis Pharma fail in defending any such claims, in addition to paying
monetary damages, we may lose valuable rights to the concerned intellectual property and
could be required to cease using the related technology or to seek license of rights to it from
the prevailing party, which may not be available on commercially reasonable terms or at all.
Any of the foregoing could result in a material adverse effect on our business, financial
condition, results of operations, and prospects.
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The regulatory approval processes of the NMPA and its regulatory authorities responsible
for review and approval are uncertain and time-consuming and may evolve over time. If we
are ultimately unable to obtain regulatory approval for our drug candidates, our business
will be substantially harmed and you may lose your investments in us.
Although the BLA filing of our Core Product was accepted by the NMPA in March 2024,
we currently do not have any products that have gained regulatory approval for marketing. The
time required to obtain the approval of the NMPA and its regulatory authorities responsible for
review and approval is inherently uncertain and depends on numerous factors, including the
substantial discretion of the regulatory authorities. Our business is substantially dependent on
our ability to obtain regulatory approval for, and, if approved, to successfully commercialize
our Core Product, lonapegsomatropin, and our other pipeline programs. We cannot
commercialize drug candidates in China or other jurisdictions without obtaining regulatory
approval from regulatory authorities in relevant jurisdictions, such as the NMPA in China.
Before obtaining regulatory approvals for the commercial sale of any drug candidate for a
particular indication, we must demonstrate with substantial evidence gathered in clinical
studies that the drug candidate is safe and effective for that indication and that the
manufacturing facilities, processes and controls comply with regulatory requirements with
respect to such drug candidate. Prior to seeking approval for any of our drug candidates, we
will need to confer with the NMPA and its regulatory authorities responsible for review and
approval regarding the design of our clinical trials and the type and amount of clinical data
necessary to seek and gain approval for our drug candidates. In addition, approval policies,
regulations, or the type and amount of clinical data necessary to gain approval may change
during the course of a drug candidate’s R&D and may vary among jurisdictions. It is possible
that none of our existing drug candidates or any future drug candidates will ever obtain
regulatory approval.
Any of the following instances during clinical trials could cause our drug candidates to
fail to receive regulatory approval from the NMPA or its regulatory authorities responsible for
review and approval:
 disagreement with the design, protocol or conduct of our clinical trials;
 failure to demonstrate that a drug candidate is safe and effective for its proposed
indication;
 failure of clinical trials to meet the level of statistical significance required for
approval;
 failure to demonstrate that a drug candidate’s clinical and other benefits outweigh its
risks;
 disagreement with our interpretation of data from clinical trials;
 insufficiency of data collected from clinical trials of our drug candidates;
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 changes in the approval policies or regulations that render our clinical data
insufficient for approval; or
 lack of adequate funding to complete a clinical trial in a manner that is satisfactory
to the applicable regulatory authority.
The NMPA or a comparable regulatory authority may require us to provide more
information, including additional pharmaceutical, non-clinical or clinical data, to support a
regulatory approval. To obtain such data, we may need to perform additional clinical trials, or
modify our manufacturing processes, or both, which may delay or prevent regulatory approval
and our commercialization plans, or force us to abandon the development program. If we
change our manufacturing processes, we may also be required to conduct additional clinical
trials or other studies, which equally could delay or prevent the approval of our drug
candidates.
Under China’s regulatory framework, in addition to obtaining marketing approval for
commercializing imported drug products, a separate marketing approval from the NMPA is
required to commercialize locally manufactured drug products. If we are unable to obtain
marketing approval to commercialize locally manufactured drug products, our business
prospects will be adversely affected, which will ultimately affect our long-term profitability.
Under China’s regulatory framework, two separate BLAs are required for a
biopharmaceutical company to commercialize imported drug products (“Import BLA”) and
locally manufactured drug products (“Local BLA”). The Import BLA only allows us to import
and commercialize drug products that are manufactured overseas, whereas the Local BLA will
allow us to commercialize locally manufactured drug products.
Pursuant to the Administrative Measures for Drug Registration ()
(“Registration Measures”) and the Drug Administration Law of the PRC ( ʕശɛ͏΍ձ਷ᖹ
) (“Drug Administration Law”), in order for the Company to sell its locally
manufactured drug products in China, the Local BLA application for registration will be
required. As part of the Local BLA application for registration, we are required to furnish,
among other materials, a drug manufacturing certificate, which certifies the local
manufacturing capabilities of the manufacturing facility. Failure to obtain the approval of
Local BLA suggests we did not receive the drug registration certificate from the NMPA, which
will consequently hinder our ability to commercialize our locally manufactured drug products
in China. And while we may continue to rely on our Import BLA to commercialize imported
drug products from Ascendis Pharma, our long-term profitability will be adversely affected as
we lose one main stream of revenue.
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Even if our drug candidates obtain regulatory approval, they may never achieve market
acceptance or commercial success, which will depend, in part, upon the degree of acceptance
among physicians, patients, third-party payors and the medical community.
Even if our drug candidates obtain NMPA or other regulatory approvals, and are
ultimately commercialized, our drug candidates may not achieve market acceptance among
physicians, patients, third-party payors, patient advocacy groups and the medical community.
For example, we are aware of several global LAGH drug products that reached the commercial
stage but were later withdrawn from the market due to factors such as market development
strategies, cost considerations, competitive advantages and disadvantages of the product and
other relevant factors. The degree of market acceptance, if any, for our most advanced drug
candidates for which marketing approval is obtained will depend on a number of factors,
including:
 the efficacy of the products as demonstrated in clinical trials;
 the prevalence and severity of any side effects and overall safety profile of the
product;
 the perceived safety of the transient conjugation technology (TransCon);
 the convenience and features of the auto-injector or drug delivery device used to
administer the drug;
 the clinical indications for which the product is approved;
 acceptance by physicians, major operators of clinics and patients of the product as
a safe and effective treatment and their willingness to pay for such product;
 relative convenience and ease of administration of our products;
 the potential and perceived advantages of our drug candidates over current treatment
options such as standard of care or alternative treatments, including future
alternative treatments;
 the availability of supply of our products and their ability to meet market demand;
 marketing and distribution support for our drug candidates;
 product labeling or product insert requirements of the NMPA or other comparable
regulatory authorities;
 the timing of market introduction of our drug candidates as well as competing
products;
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 the affordability of our drug candidates and the cost of treatment in relation to
alternative treatments;
 the quality of our relationships with patient advocacy groups; and
 coverage and reimbursement policies of government and other third-party payors.
If our drug candidates that obtain regulatory approval do not achieve significant market
acceptance or commercial success, this could harm our business, results of operations and
prospects, and the value of our Shares. Even if our products achieve market acceptance, we
may not be able to maintain that market acceptance over time if new products or technologies
introduced are more favorably received than our products, are more cost-effective and render
our products obsolete.
Competition in the biotechnology and biopharmaceutical industries is intense and our
competitors may discover, develop or commercialize products that are safer, more effective,
more effectively marketed or cost less than ours, or receive regulatory approval or reach the
market earlier. If we are unable to compete effectively, our business, results of operations
and prospects will suffer.
The markets in which we intend to compete are undergoing, and are expected to continue
to undergo, rapid and significant technological changes. Some of our drug candidates are for
fields in which competing products already exist and are established. We expect competition
to intensify as technological advances are made or new drugs and biopharmaceutical products
are introduced. New developments by competitors may render our current or future drug
candidates and/or technologies non-competitive, obsolete or not economical. Our competitors’
products may be more efficacious or marketed and sold more effectively than any of our drug
candidates. Many of our competitors have:
 significantly greater name recognition, financial, marketing, research, drug
development and technical and human resources than we have at every stage of the
discovery, development, manufacturing and commercialization process and
additional mergers and acquisitions in the biopharmaceutical industries may result
in even more resources being concentrated in our competitors;
 more extensive experience in commercializing drugs, conducting pre-clinical
testing, conducting clinical studies, obtaining regulatory approvals, challenging
patents and manufacturing and marketing pharmaceutical products;
 more expansive patent and other intellectual property and proprietary rights than us;
 products that have been approved or are in late stages of development; and
 collaboration arrangements in our target markets with leading companies and
research institutions.
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We are aware of several pharmaceutical and biopharmaceutical companies that have
commenced clinical studies of products or have successfully commercialized products
addressing areas that we are targeting. There are a variety of experimental growth hormone
therapies based on different stages of clinical development by various companies, including
Novo Nordisk A/S, Xiamen Amoytop Biotech Co., Ltd. and Anhui Anke Biotechnology
(Group) Co., Ltd. In addition, academic institutions, government agencies, and other public
and private organizations conducting research may seek patent protection with respect to
potentially competing products or technologies. These organizations may also establish
exclusive collaborative or licensing relationships with our competitors.
It is also possible that our competitors will commercialize competing drugs or treatments
before we launch our drug candidates. We also anticipate that we will face increased
competition in the future as new companies enter into the endocrine drugs market. For
example, unmodified LAGH therapies approved overseas may enter China’s market in the
future, and we may therefore face increased challenges in effectively competing with them.
Furthermore, to the extent we are developing endocrine drug candidates that incorporate
already approved drugs, we face competition from the pharmaceutical companies which are
currently marketing such approved products. These pharmaceutical companies can generally be
expected to seek to delay the introduction of competing products through a variety of means
including:
 filing new formulation patent applications on drugs whose original patent protection
is about to expire;
 filing an increasing number of patent applications that are more complex and costly
to challenge;
 filing suits for alleged patent infringement to delay regulatory approval;
 developing patented controlled-release or other “next-generation” products, which
may compete with endocrine drug candidates;
 establishing exclusive contracts with third-party payors; or
 changing product claims and product labeling.
Any one of these strategies may increase the costs and risks associated with our efforts
to introduce any of our drug candidates and may delay or altogether prevent such introduction.
Our competitors may develop or commercialize products with significant advantages in regard
to any of these factors. Our competitors may therefore be more successful in commercializing
their products than we are, which could adversely affect our business, results of operations and
prospects, and the value of our Shares.
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Guidelines, recommendations and studies published by various organizations could disfavor
our drug candidates.
Government agencies, professional societies, practice management groups, private health
and science foundations and organizations focused on various diseases may publish guidelines,
recommendations or studies that affect our three drug candidates. Any such guidelines,
recommendations or studies that reflect negatively on our three drug candidates, either directly
or relative to our competitive drug candidates, could result in potential decreased use, sales of,
and revenues from one or more of our drug candidates. Additionally, our success depends in
part on our and our collaboration partner’s ability to educate healthcare providers and patients
about our drug candidates, and these education efforts could be rendered ineffective by, among
other things, third-parties’ guidelines, recommendations or studies.
We have no experience in launching and marketing drug candidates in China (including
Hong Kong, Macau and Taiwan). If we are unable to effectively build and manage our
commercial network or benefit from third-party collaborators’ sales network, we may be
unable to generate any revenue.
Even though our senior management members are experienced in launching and
marketing drug candidates, our Company currently has no sales, marketing or commercial
product distribution capabilities and has no experience in marketing drugs. We are developing
an in-house marketing organization and commercialization team in alignment with the updated
timeline of BLA registration and commercial launch of the Core Product, which will require
significant capital expenditures, management resources and time. We will have to compete with
other biopharmaceutical companies to recruit, hire, train and retain marketing personnel and
medical representatives.
Although we are currently focused on establishing internal sales, marketing and
commercial distribution capabilities, we may in the future pursue collaborative arrangements
regarding the sales and marketing of some of our drug candidates and there can be no assurance
that we will be able to establish or maintain such collaborative arrangements, or, if we are able
to do so, that they will have effective medical representative team. Relevant part of the revenue
we receive will depend on the efforts of such third parties, which may not be successful. We
may have little or no control over the marketing and sales efforts of such third parties in
accordance with local rules and regulations, and our revenue from product sales may be lower
than if we had commercialized our drug candidates ourselves. We will also face competition
in our search for third parties to assist us with the sales and marketing efforts of our drug
candidates.
There can be no assurance that we will be able to develop in-house medical representative
team and commercial distribution capabilities or establish or maintain relationships with
third-party collaborators to successfully commercialize any product, especially given the
limited experience generally in marketing recently approved drugs in China (including Hong
Kong, Macau and Taiwan). As a result, we may not be able to generate product sales revenue.
RISK FACTORS
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We have incurred losses in every year since our inception. We expect to continue to incur
losses over the next several years and may never achieve or maintain profitability.
We have no products approved for commercial sale, have not generated any revenue from
commercial sales of our drug candidates, and have incurred net losses each year since we
commenced operations in 2018. In 2022, 2023 and the nine months ended September 30, 2024,
our total comprehensive losses were RMB288.9 million, RMB249.5 million and RMB129.7
million, respectively.
We have been devoting the majority of our financial resources and efforts to our R&D
activities, including clinical development of our drug candidates. None of our drug candidates
have received marketing approval and we may never be successful in obtaining marketing
approval and commercializing our drug candidates. We expect to continue to incur expenses
and increase operating losses for the foreseeable future. We anticipate that our expenses will
increase as we:
 continue our ongoing and planned clinical development of our drug candidates;
 collaborate with WuXi Biologics to strengthen our commercialization capabilities
and establish localized manufacturing capabilities;
 seek regulatory approvals for our drug candidates;
 commercialize those of our drug candidates for which we have obtained marketing
approval;
 hire additional clinical, operational, financial, quality control and scientific
personnel;
 expand our commercialization team for any future products that have obtained
regulatory approval; or
 incur additional legal, accounting and other expenses associated with operating as a
public company.
To become and remain profitable, we must succeed in developing and eventually
commercializing products that generate significant revenue. This will require us to be
successful in a range of challenging activities, including completing clinical trials of our drug
candidates, obtaining regulatory approval, manufacturing, marketing and selling any products
for which we may obtain regulatory approval, as well as discovering, developing or
in-licensing additional drug candidates. We may never succeed in these activities and, even if
we do, may never generate revenue that is significant enough to achieve profitability.
RISK FACTORS
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Because of the numerous risks and uncertainties associated with the development and
commercialization of the drug candidates, we are unable to accurately predict the timing or
amount of expenses or when, or if, we will be able to achieve profitability. If we are required
by regulatory authorities to perform studies in addition to those currently expected, or if there
are any delays in the initiation and completion of our clinical trials or the development of any
of our drug candidates, our expenses could increase and profitability could be further delayed.
Even if we achieve profitability, we may not be able to sustain or increase profitability
on a quarterly or annual basis. Our failure to become and remain profitable would depress the
value of our Shares and could impair our ability to raise capital, expand our business, maintain
our R&D efforts or continue our operations. A decline in the value of our Shares could also
cause you to lose part or all of your investment.
We have net operating cash outflow during the Track Record Period.
We had net cash used in operating activities of RMB246.5 million, RMB271.3 million and
RMB102.4 million in 2022, 2023 and the nine months ended September 30, 2024, respectively.
While we believe we have sufficient working capital to fund our current operations for the next
few years, we expect that we will continue to experience net cash outflows from our operating
activities for the foreseeable future. If we are unable to maintain adequate working capital, we
may default on our payment obligations and may not be able to meet our operating cash and
capital expenditure requirements, which may have a material adverse effect on our business,
financial condition, results of operations, and prospects.
We will need to obtain funding from time to time to complete the development and any
commercialization of our drug candidates, which may not be available on acceptable terms,
or at all. If we are unable to raise capital when needed, we may be forced to delay, reduce
or eliminate our product development programs or other operations.
Since our inception, we have used substantial amounts of cash to fund our operations and
expect our expenses to increase substantially during the next few years. The development of
biopharmaceutical drug candidates is capital intensive. As our drug candidates enter and
advance through clinical trials, we will require substantial additional funding to meet our
financial needs and to pursue our business objectives.
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As of September 30, 2024, we had RMB242.6 million in cash and cash equivalents. We
believe that the net proceeds from this Global Offering, together with our existing cash and
cash equivalents, will enable us to fund our operating expenses and capital expenditure
requirements for the next 12 months. However, we will need to raise additional capital
to complete the development and/or commercialization of our drug candidates,
lonapegsomatropin for the treatment of PGHD, TransCon CNP (navepegritide) for the
treatment of ACH, and palopegteriparatide for the treatment of adult patients with HP , and in
connection with our continuing operations and other planned activities. Our future capital
requirements will depend on many factors, including:
 the progress, results and costs of laboratory testing, manufacturing, and clinical
development for our current drug candidates;
 the scope, progress, results and costs of laboratory testing and clinical trials of other
drug candidates that we may pursue;
 the development requirements of other drug candidates that we may pursue;
 the timing and amounts of any milestone or royalty payments we may be required
to make under any future license agreements, if we enter into such agreements;
 the costs of expanding our R&D capacities, including hiring additional R&D,
clinical, quality control and manufacturing personnel;
 the costs, timing and outcome of regulatory review of our drug candidates;
 the costs and timing of future commercialization activities, including product
manufacturing, marketing, sales and distribution, for any of our drug candidates for
which we receive marketing approval;
 the amount of revenue, if any, received from commercial sales of our drug
candidates for which we receive marketing approval;
 the costs and timing of preparing, filing and prosecuting patent applications,
obtaining, maintaining, protecting and enforcing our intellectual property and
proprietary rights and defending against any intellectual property-related claims;
 the costs of operating as a public company; and
 the extent to which we acquire or in-license additional drug candidates and
technologies.
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Identifying potential drug candidates and conducting clinical trials is a time consuming,
expensive and uncertain process that takes years to complete, and we may never generate the
necessary data or results required to obtain regulatory approval and achieve product sales. In
addition, our drug candidates, if approved, may not achieve commercial success. To date, we
have no products approved for commercial sale, nor have we generated any revenue from
product sales. Accordingly, we will need to continue to rely on additional financing to achieve
our business objectives. Adequate additional financing may not be available to us on acceptable
terms, or at all. In addition, we may seek additional capital due to favorable market conditions
or strategic considerations even if we believe we have sufficient funds for our current or future
operating plans. If we raise additional funds through collaboration and licensing arrangements
with third parties, we may have to relinquish some rights to our drug candidates on terms that
are not favorable to us. Any additional capital-raising efforts may divert our management from
their day-to-day activities, which may adversely affect our ability to develop and
commercialize our current and future drug candidates, if approved. If we are unable to raise
capital when needed or on acceptable terms, we may be forced to delay, reduce or altogether
cease our R&D programs or future commercialization efforts.
OTHER RISKS RELATED TO OUR LIMITED OPERATING HISTORY, FINANCIAL
POSITION AND NEED FOR ADDITIONAL CAPITAL
We have a limited operating history, no products approved for commercial sale, never
generated any revenue and may incur significant losses in the future, which makes it
difficult to assess our future viability. The risks involved in our business may cause potential
investors to lose substantially all of their investment in us.
We are a late-stage, near-commercialization biopharmaceutical company. To date, we
have focused the majority of our efforts on our R&D activities and, in particular, developing
lonapegsomatropin, our Core Product, for the treatment of PGHD, TransCon CNP
(navepegritide) for the treatment of ACH, and palopegteriparatide for HP . We have not yet
successfully obtained marketing approvals for, manufactured or commercialized our drug
candidates. We have no products approved for commercial sale and have not generated any
revenue from product sales. We expect that our annual operating expenses may increase over
the next several years as we expand our R&D efforts and prepare for commercialization.
Our limited operating history, particularly in light of the rapidly evolving drug
development industry in which we operate and the changing environments we encounter, may
make it difficult to evaluate our current business and prospects for future performance. As a
result, any assessment of our future performance or viability is subject to significant
uncertainty. We will encounter risks and difficulties frequently experienced by clinical-stage
companies in rapidly evolving fields as we seek to transition into a company capable of
supporting commercial activities. If we do not address these risks and difficulties successfully,
our business will suffer and may cause potential investors to lose substantially all of their
investment in us.
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Share-based payments may impact our financial performance and cause shareholding
dilution to our existing Shareholders.
We adopted the Equity Incentive Plan and granted restricted share units to certain
employees, directors, consultants and other eligible persons to motivate and reward the eligible
persons who had contributed and would continue to contribute to the success of our Company.
In 2022, 2023 and the nine months ended September 30, 2024, we recorded non-cash
share-based payments of RMB93.5 million, RMB(12.3) million and RMB28.4 million,
respectively. For further details of the share-based payments, please see the section headed
“Financial Information” in this document. To further motivate our employees, directors,
consultants and other eligible persons and align their interests with ours, we may grant
additional share-based compensation in the future. Expenses incurred with respect to such
share-based payments may increase our operating expenses and therefore have an adverse
effect on our financial performance. Issuance of additional Shares with respect to such
share-based payments may also dilute the shareholding percentage of our existing
Shareholders.
Raising additional capital may cause dilution to the interests of our Shareholders, restrict
our operations or require us to relinquish rights to our technologies or drug candidates.
We may seek additional funding through a combination of equity offerings, debt
financings, collaborations and licensing arrangements. To the extent that we raise additional
capital through the sale of equity or convertible debt securities, the value of your investment
in our Shares will be diluted, and the terms may include liquidation or other preferences that
adversely affect your rights as a holder of our Shares. The incurrence of additional
indebtedness or the issuance of certain equity securities could give rise to increased fixed
payment obligations and also result in certain additional restrictive covenants, such as
limitations on our ability to incur additional debt or issue additional equity, limitations on our
ability to acquire or in-license intellectual property rights and other operating restrictions that
could adversely impact our ability to conduct our business. In addition, the issuance of
additional equity securities, or the possibility of such issuance, may cause the market price of
our Shares to decline.
In the event we enter into collaborations or licensing arrangements in order to raise
capital, we may be required to accept unfavorable terms, including relinquishing or licensing
to a third party our rights to drug candidates, which may include without limitation the
exclusive licensed rights in China (including Hong Kong, Macau and Taiwan) that we obtained
from Ascendis Pharma and rights to potentially future drug candidates, on unfavorable terms,
which we would have otherwise sought to develop or commercialize ourselves or reserve for
future potential arrangements when we are more likely to achieve more favorable terms.
RISK FACTORS
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OTHER RISKS RELATED TO THE DEVELOPMENT OF OUR DRUG CANDIDATES
Safety issues with the parent drugs or other components of our drug candidates, or with
approved products of third parties that are similar to our drug candidates, could give rise to
delays in the regulatory approval process.
Our product development portfolio consists of prodrugs that are new molecular entities
that incorporate existing parent drug molecules, many of which have been previously approved
by the EMA, the FDA or other regulatory authorities. Discovery of previously unknown
problems with any of the parent drugs that we use in our drug candidates may result in
restrictions on its permissible uses, including withdrawal of the product from the market.
Additionally, problems with approved parent drugs marketed by third parties that utilize the
same therapeutic target as the parent drug we use in our drug candidates could adversely affect
the development of our drug candidates.
Any failure or delay in commencing or completing clinical trials or obtaining regulatory
approvals for our drug candidates would delay the commercialization of the drug candidates
and severely harm our business and financial condition.
We may not make the best resource allocation decision or collaboration decision to pursue
the in-licensed drug candidate or indication with the best commercial potential.
We are currently focusing on the three drug candidates in our pipeline, lonapegsomatropin
for PGHD, TransCon CNP (navepegritide) for ACH and palopegteriparatide for HP . As a result,
we may forego or delay pursuit of opportunities with other potential drug candidates or for
other indications that later prove to have greater commercial potential. Our resource allocation
decisions may cause us to fail to capitalize on viable commercial products or profitable market
opportunities. Our spending on current and future R&D programs and drug candidates for
specific indications may not yield any commercially viable products. If we do not accurately
evaluate the commercial potential or target market for a particular drug candidate, we may
relinquish valuable rights to that drug candidate through licensing, royalty or other
collaboration arrangements in cases in which it would have been more advantageous for us to
retain sole development and commercialization rights to such drug candidate.
Clinical trials are difficult to implement, involve uncertain outcomes and may not be
successful and results of earlier studies and trials may not be predictive of future trial
results.
Clinical testing is expensive and can take years to complete, and its outcome is inherently
uncertain. Failure can occur at any time during the clinical trial process. The initial or interim
results of a trial may not be predictive of the final results, and the results from the global trials
of a particular drug candidate may not be predictive of the results to be generated from the
trials we are conducting or will conduct for the same drug candidate in China (including Hong
Kong, Macau and Taiwan). Drug candidates in later stages of clinical trials in China (including
Hong Kong, Macau and Taiwan) may fail to show the desired safety and efficacy traits despite
having progressed through pre-clinical studies, initial clinical trials and global clinical trials.
RISK FACTORS
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In some instances, there can be significant variability in safety and/or efficacy results between
different trials of the same drug candidate due to numerous factors, including changes in trial
procedures set forth in protocols, differences in the size and type of the patient populations,
including genetic differences, other trial protocol elements and the rate of dropout among
clinical trial participants. In the case of any trials we conduct, results may differ from earlier
trials conducted by Ascendis Pharma due to various factors, including the difference in clinical
practice and various uncertainties in trial conduction. A number of companies in the
biopharmaceutical industry have suffered significant setbacks in advanced clinical trials due to
lack of efficacy or adverse safety profiles, notwithstanding positive results in earlier trials. Our
future clinical trial results may not be favorable, regardless of earlier results from the global
clinical trials conducted by Ascendis Pharma and China clinical trials conducted by us. If so,
we would have expended a significant amount of capital to progress the relevant drug
candidates to that stage, and would not realize any revenue on such drug candidate if it then
ultimately failed to receive regulatory approval due to poor clinical trial results. Such an
uncompensated expenditure could materially adversely affect our business, financial condition,
results of operations and prospects.
We rely and will continue to rely on investigators and third parties to conduct clinical trials
for our drug candidates in China (including Hong Kong, Macau and Taiwan). If we lose our
relationships with them or if they do not successfully carry out their contractual duties or
meet expected deadlines, we may not be able to obtain regulatory approval for or
commercialize our drug candidates and our business could be substantially harmed.
We have relied on and plan to continue to rely on investigators and third-party CROs to
monitor and manage data for our ongoing clinical programs. We rely on these parties for the
execution of our clinical trials, and we control only certain aspects of their activities.
Nevertheless, we are responsible for ensuring that each of the studies sponsored by us is
conducted in accordance with the applicable protocol and legal, regulatory and scientific
standards, and our reliance on the investigators and CROs does not relieve us of our regulatory
responsibilities.
We, our investigators and CROs are required to comply with GCP , GLP , and other
regulatory regulations and guidelines enforced by the NMPA and comparable regulatory
authorities for all of our drug candidates in clinical development. Regulatory authorities
enforce these GCP , GLP or other regulatory requirements through periodic inspections of trial
sponsors, investigators and trial sites. If we or any of our investigators and CROs fail to
comply with applicable GCP , GLP or other regulatory requirements, the relevant data generated
in our clinical trials may be deemed unreliable and the NMPA or other comparable regulatory
authorities may require us to perform additional clinical studies before approving our
marketing applications. There can be no assurance that upon inspection by a given regulatory
authority, such regulatory authority will determine that any of our clinical trials complies with
GCP and GLP requirements. In addition, our clinical trials must be conducted with drug
candidates or products produced under GMP requirements. Failure to comply with these
regulations may require us to repeat pre-clinical and clinical trials, which would delay the
regulatory approval process.
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Our CROs have the right to terminate their agreements with us in the event of a material
breach that is not substantially cured. If any of our relationships with our third-party CROs is
terminated, we may not be able to (i) enter into arrangements with alternative CROs or do so
on commercially reasonable terms or (ii) meet our desired clinical development timelines. In
addition, there is a natural transition period when a new CRO commences work, and the new
CRO may not provide the same type or level of services at the same pace as the original
provider and data from our clinical trials may be compromised as a result. There is also a need
for relevant technology to be transferred to the new CRO, which may take time and further
delay our development timelines.
Except for remedies available to us under our agreements with investigators and third
parties, we cannot control whether or not they devote sufficient time and resources to our
clinical programs. If our investigators and third parties do not successfully carry out their
contractual duties or obligations or meet expected deadlines or if the quality or accuracy of the
clinical data they obtain is compromised due to their failure to adhere to our clinical protocols,
regulatory requirements or for other reasons, our clinical trials may be extended, delayed or
terminated and we may not be able to obtain regulatory approval for or successfully
commercialize our drug candidates. As a result, our results of operations and the commercial
prospects for our drug candidates would be harmed and our costs could increase. In turn, our
ability to generate revenues could be delayed or compromised.
We rely on third parties to carry out many of our activities, which may lead to
uncertainties with respect to the deliverables despite our efforts in managing our third-party
vendors. Outsourcing these functions involves certain risks that third parties may not perform
to our standards, may not produce results in a timely manner or may fail to perform at all. In
addition, the use of third-party service providers requires us to disclose our proprietary
information to these third parties, which could increase the risk of such information being
misappropriated. We currently have a small number of employees, which limits the internal
resources we have available to identify and monitor our third-party service providers. To the
extent we are unable to identify and successfully manage the performance of third-party
service providers in the future, our business may be adversely affected. Though we carefully
manage our relationships with our investigators and third parties, there can be no assurance that
we will not encounter similar challenges or delays in the future or that these delays or
challenges will not have a material adverse impact on our business, financial condition and
prospects.
RISK FACTORS
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We currently purchase our drug candidates from our collaboration partner, Ascendis
Pharma, for clinical development in China and purchase our drug candidates from them for
commercial supply in the future. Our business could be harmed if our collaboration partner
fails to provide us with sufficient quantities of drug candidates or trial materials or fail to
do so at an acceptable quality levels or prices.
We currently purchase our drug candidates from our collaboration partner, Ascendis
Pharma, for clinical development in China, and purchase our drug candidates from them for
commercial supply of lonapegsomatropin in China before the establishment of local
manufacturing capabilities. The current and future supply arrangement may expose us to
certain risks, including the following:
 our collaboration partner may have limited capacity or limited manufacturing slots,
which may affect the timeline for the production of our drugs;
 they might be unable to timely manufacture our drug candidates or produce the
quantity and quality required to meet our clinical and commercial needs, if any;
 they may not be able to execute our manufacturing procedures and other logistical
support requirements appropriately;
 they may not perform as agreed, may not devote sufficient resources to our drugs,
or may not remain in the contract manufacturing business for the time required to
supply our clinical trials or to successfully produce, store and distribute our drugs;
 they are subject to ongoing periodic unannounced inspections to ensure strict
compliance with GMP and other government regulations. We do not have control
over their compliance with these regulations and requirements;
 they may be unable to sustain their business and become bankrupt as a result;
 raw materials and components used in the manufacturing process, particularly those
for which we or Ascendis Pharma have no other source or supplier, may not be
available or may not be suitable or acceptable for use due to material or component
defects;
 products and components from them may be subject to additional customs and
import charges, which may cause us to incur delays or additional costs as a result;
 they may be subject to inclement weather, as well as natural or man-made disasters;
and
 they may have unacceptable or inconsistent product quality success rates and yields.
RISK FACTORS
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Each of these risks could delay or prevent the completion of our clinical trials or the
approval of any of our drug candidates by the NMPA or other comparable regulatory
authorities, result in higher costs or adversely impact the commercialization of our drug
candidates. In addition, we may rely on third parties to perform certain specification tests on
our product. If these activities are not appropriately done and the data is not reliable, the NMPA
or other comparable regulatory authorities could place restrictions on us until deficiencies are
remedied.
Manufacturers of biopharmaceutical products often encounter difficulties in production,
particularly in scaling up or out, validating the production process, and assuring high reliability
of the manufacturing process, including the absence of contamination. These problems include
logistics and shipping, difficulties with production costs and yields, quality control, including
stability of the product, product testing, operator error and availability of qualified personnel,
as well as compliance with strictly enforced regulations in the PRC and other applicable
jurisdictions. Further, if contaminants are discovered in the supply of our drug candidates or
in the manufacturing facilities, such manufacturing facilities may need to be closed for an
extended period of time for us to investigate and remedy the contamination. There can be no
assurance that any stability failures or other issues relating to the manufacture of our drug
candidates will not occur in the future. Additionally, Ascendis Pharma may experience
manufacturing difficulties due to resource constraints or as a result of labor disputes or
unstable political environment. If Ascendis Pharma were to encounter any of these difficulties,
or otherwise fail to comply with their contractual obligations, our ability to provide our drug
candidate would be jeopardized. Any delay or interruption in the supply of clinical trial
supplies could delay the completion of our clinical trials, increase the costs associated with
maintaining clinical trial programs and, depending upon the period of delay, require us to begin
new clinical trials at additional expense or terminate clinical trials completely.
We depend on enrollment of patients in our clinical trials for our drug candidates. If we
encounter difficulties enrolling patients in our clinical trials, our clinical development
activities could be delayed or otherwise adversely affected.
Identifying and qualifying patients to participate in clinical trials of our drug candidates
is critical to our success. The timely completion of clinical trials in accordance with the
protocols depends, among other things, on our ability to enroll a sufficient number of patients
who remain in the study until its conclusion. The enrollment of patients depends on many
factors, including:
 the patient eligibility criteria defined in the protocol;
 the number of patients with the disease or condition being studied;
 the understanding of risks and benefits of the drug candidate in the trial;
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 clinicians’ and patients’ perceptions as to the potential advantages of the drug
candidate being studied in relation to other available therapies, including any new
drugs that may be approved for the indications we are investigating or drugs that
may be used off-label for these indications;
 the size and nature of the patient population who meet inclusion criteria;
 the proximity of patients to study sites;
 the design of the clinical trial;
 our ability to recruit clinical trial investigators with the appropriate competencies
and experience;
 competing clinical trials for similar therapies or other new therapies;
 our ability to obtain and maintain patient consents; and
 the risk that patients enrolled in clinical trials will drop out of the clinical trials
before completion of their treatment.
We may not be successful in developing, acquiring, enhancing or adapting to new
technologies and methodologies to enhance the scope and quality of our clinical trials.
We must keep pace with new technologies and methodologies to maintain our competitive
position. In 2022, 2023 and the nine months ended September 30, 2024, our research and
development costs were RMB179.5 million, RMB57.7 million and RMB58.9 million,
respectively. We must continue to invest significant amounts of human and capital resources
to develop or acquire technologies that will allow us to enhance the scope and quality of our
clinical trials. We also intend to continue to enhance our technical capabilities in product
research and discovery, development and manufacturing, which are capital and time-intensive.
We cannot assure you that we will be able to develop, enhance or adapt to new technologies
and methodologies, successfully identify new technological opportunities, develop and bring
new or enhanced products to market, obtain sufficient or any patent or other intellectual
property protection for such new or enhanced products, or obtain the necessary regulatory
approvals in a timely and cost-effective manner, or, if such products are introduced, that those
products will achieve market acceptance. Any failure to do so may make our techniques
obsolete, which could harm our business and prospects.
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OTHER RISKS RELATED TO OUR INTELLECTUAL PROPERTY
Patent and other intellectual property litigation may lead to unfavorable publicity which may
harm our reputation and cause the market price of our Shares to decline, and any
unfavorable outcome from such litigation could limit our R&D activities and/or our ability
to commercialize our drug candidates.
During the course of any intellectual property litigation involving us or Ascendis Pharma,
there could be public announcements of the results of hearings, rulings on motions, and other
interim proceedings in the litigation. If securities analysts or investors regard these
announcements, or the announcement of the litigation, as negative, the perceived value of our
drug candidates, future drugs, programs or intellectual property could be diminished.
Accordingly, the market price of our Shares may decline. Such announcements could also harm
our reputation or the market for our drug candidates, which could have a material adverse
effect on our business. In addition, the uncertainties associated with litigation could have a
material adverse effect on our ability to raise the funds necessary to conduct our clinical trials,
in-license needed technology, or enter into strategic partnerships that would help us bring our
drug candidates to market.
Obtaining and maintaining patent protection depends on compliance with various
procedural, document submission, fee payment and other requirements imposed by
governmental patent agencies, and our patent protection could be reduced or eliminated if
we or Ascendis Pharma do not comply with these requirements.
Periodic maintenance fees, renewal fees, annuity fees and various other government fees
on a patent and patent application are due to be paid to the patent offices and agencies in
several stages each year lifetime of the patent and patent application. Patent agencies in the
PRC and other jurisdictions require compliance with a number of procedural, documentary, fee
payment and other similar provisions during the patent application process. In certain
circumstances, including for patent rights licensed from Ascendis Pharma, we may be required
to rely on our partners to take the necessary action to comply with these requirements with
respect to patents or other intellectual property they have licensed to us. While an inadvertent
lapse can in many cases be cured by payment of a late fee or by other means in accordance with
the applicable rules, there are situations in which noncompliance, which could include failure
to respond to official actions within prescribed time limits, non-payment of fees and failure to
properly legalize and submit formal documents, can result in abandonment or lapse of the
patent or patent application, resulting in partial or complete loss of patent rights in the relevant
jurisdiction. Upon such an event, our competitors and other third parties may be able to enter
the market and compete with our drug candidates, which would have a material adverse effect
on our business, financial condition, results of operations and prospects.
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If we are unable to protect the confidentiality of trade secrets and other confidential
information, including unpatented know-how upon which we rely, our business and
competitive position would be harmed.
In addition to patent rights, we rely on trade secret and other confidential information,
including unpatented know-how, technology and other proprietary information, to maintain our
competitive position and to protect our drug candidates. We seek to protect our trade secrets
and confidential information, in part, by entering into non-disclosure and confidentiality
agreements with parties that have access to them.
However, we may not obtain these agreements in all circumstances, and individuals with
whom we have these agreements may not comply with their terms. In the event of unauthorized
use or disclosure of our trade secrets or proprietary information, these agreements, even if
obtained, may not provide meaningful protection, particularly for our trade secrets or other
confidential information. To the extent that our employees use technology or know-how owned
by third parties in their work for us, disputes may arise between us and those third parties as
to the rights in related inventions.
Enforcing a claim that a party illegally disclosed or misappropriated a trade secret is
difficult, expensive, and time-consuming, and the outcome is unpredictable. In addition, courts
in some jurisdictions are less willing or unwilling to protect trade secrets. Adequate remedies
may not exist in the event of unauthorized use or disclosure of our trade secrets or confidential
information. The disclosure of our trade secrets would impair our competitive position and may
materially harm our business, financial condition, results of operations and prospects.
We may be subject to claims that we or our employees have misappropriated the intellectual
property, including know-how or trade secrets, of a third party, or claiming ownership of
what we regard as our own intellectual property, or are in breach of non-competition or
non-solicitation agreements with competitors or other third parties.
Many of our employees were previously employed at or engaged by other biotechnology
or biopharmaceutical companies, including our competitors or potential competitors. Some of
these employees executed proprietary rights, non-disclosure and non-competition agreements
in connection with such previous employment. Although we try to ensure that our employees
do not use the intellectual property, proprietary information, know-how or trade secrets of
others in their work for us, we may be subject to claims that we or these employees have used
or disclosed such intellectual property, including know-how, trade secrets or other proprietary
information or are in breach of non-competition or non-solicitation agreements with
competitors or other third parties. Litigation may be necessary to defend against these claims.
If we fail in defending any such claims, in addition to paying monetary damages, we may lose
valuable intellectual property rights or personnel. Even if we are successful in defending
against such claims, litigation could result in substantial costs and be a distraction to
management and scientific personnel.
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In addition, while we typically require our employees and contractors who may be
involved in the development of intellectual property to execute agreements assigning such
intellectual property to us, we may be unsuccessful in executing such an agreement with each
party who in fact develops intellectual property that we regard as our own and the agreements
may be breached or may not be self-executing, which may result in claims by or against us
related to the ownership of what we regard as our intellectual property. If we fail in prosecuting
or defending any such claims, in addition to paying monetary damages, we may lose valuable
intellectual property rights. Even if we are successful in prosecuting or defending against such
claims, litigation could result in substantial costs and be a distraction to our management and
scientific personnel. Any of the foregoing could have a material adverse effect on our business,
financial condition, results of operations and prospects.
Intellectual property rights do not necessarily protect us from all potential threats to our
competitive advantage.
The degree of protection afforded by our intellectual property rights is uncertain because
intellectual property rights have limitations, and they may not adequately protect our business,
or permit us to maintain our competitive advantage. The following examples are illustrative:
 others may be able to make products that are similar to any drug candidates we may
develop or utilize similar technology that are not covered by the claims of the
patents that we own or are licensed now or in the future;
 we or our licensors might not have been the first to make the inventions covered by
the issued patents or pending patent applications that we own or in-license, which
could result in the patents applied for not being issued or being invalidated after
issuing;
 others may independently develop similar or alternative technologies or duplicate
any of our technologies without infringing our owned or licensed intellectual
property rights;
 pending patent applications may not lead to issued patents;
 we may obtain or in-license patents for certain compounds many years before we
receive NDA or other approval for drugs containing such compounds, and because
patents have a limited life, which may begin to be invalid prior to the commercial
sale of the related drugs, the commercial value of our patents may be limited;
 our competitors might conduct R&D activities in jurisdictions where we do not have
rights to patents and then use the information learned from such activities to develop
competitive drugs for commercialization in our major markets;
 we may fail to develop or acquire rights to additional proprietary technologies that
are patentable;
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 we may fail to apply for or obtain adequate intellectual property protection in all the
jurisdictions in which we operate;
 third parties may gain unauthorized access to our intellectual property due to
potential lapses in our information systems;
 the patents of others may have an adverse effect on our business, for example by
preventing us from commercializing one or more of our drug candidates for one or
more indications; and
 we may choose not to file a patent for certain trade secrets or know-how, and a third
party may subsequently file a patent covering such intellectual property.
Any of the aforementioned threats to our competitive advantage could have a material
adverse effect on our business, financial condition, results of operations and prospects.
If our trademarks and trade names are not adequately protected, then we may not be able to
build name recognition in our markets of interest and our business may be adversely
affected.
Our registered and unregistered trademarks or trade names are valuable assets and may
be challenged, infringed, circumvented or declared generic or determined to infringe a third
party’s marks. We may not be able to protect our rights to these trademarks and trade names,
which may be necessary to build name recognition among potential collaborators or customers
in our markets of interest. At times, competitors or other third parties may adopt trade names
or trademarks similar to ours, thereby impeding our ability to build brand identity and possibly
leading to market confusion. In addition, there could be potential trade name or trademark
infringement claims brought by owners of other trademarks or trademarks that incorporate
variations of our registered or unregistered trademarks or trade names. Over the long term, if
we are unable to establish name recognition based on our trademarks and trade names, then we
may not be able to compete effectively, and our business may be adversely affected. If we
attempt to enforce our trademarks and assert trademark infringement claims, a court may
determine that the marks we have asserted are invalid or unenforceable, or that the party
against whom we have asserted trademark infringement has superior rights to the marks in
question. In the event that our trademarks or trade names are successfully challenged, we could
be forced to rebrand our drugs, which could result in loss of brand recognition and could
require us to devote resources to advertising and marketing new brands. Our efforts to enforce
or protect our proprietary rights related to trademarks, trade names, trade secrets, domain
names, copyrights or other intellectual property may be ineffective and cause substantial costs
and diversion of resources and could adversely affect our competitive position, business,
financial condition, results of operations and prospects.
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The absence of patent linkage, patent term extension and data and market exclusivity for
NMPA-approved pharmaceutical products could increase the risk of early generic
competition with our products in China.
The life of a patent and the protection it affords are limited. Even if we in-license valid
patents covering our drug candidates, we may still be open to competition once the patent life
has expired for a drug. In the United States, competing generic products are prevented from
entering the market for a certain period of time after the FDA grants marketing approval for
the innovative products in certain circumstances. In China, the latest Patent Law of the PRC
and other relevant regulations on drug registration contains provisions on extension of patent
terms, linking of patents to products to delay generic entry, and granting of data exclusivity in
certain circumstances. However, our competitors may obtain approval of competing products
prior to or following our patent expiration, our business, financial condition, results of
operations, and prospects could be materially harmed.
OTHER RISKS RELATED TO OBTAINING REGULATORY APPROV AL OF OUR
DRUG CANDIDATES AND OTHER LEGAL COMPLIANCE MATTERS
All material aspects of the research, development and commercialization of pharmaceutical
products are heavily regulated.
All jurisdictions in which we intend to conduct our pharmaceutical-industry activities
regulate these activities in great depth and detail. We intend to focus our activities on China
(including Hong Kong, Macau and Taiwan). These jurisdictions strictly regulate the
pharmaceutical industry, and in doing so they employ broadly similar regulatory strategies,
including regulation of product development and approval, manufacturing, and marketing,
sales and distribution of products. However, there are differences in the regulatory regimes that
make for a more complex and costly regulatory compliance burden for a company like ours that
plans to operate in these regions.
The process of obtaining regulatory approvals and compliance with appropriate laws and
regulations requires the expenditure of substantial time and financial resources. Failure to
comply with the applicable requirements at any time during the product development process
and approval process, or after approval, may subject an applicant to administrative or judicial
sanctions. These sanctions could include refusal to approve pending applications, withdrawal
of an approval, revocation of a license, a hold on clinical trials, voluntary or mandatory recalls
of products, the seizure of products, total or partial suspension of production or distribution,
injunctions, fines, refusals of government contracts, restitution, disgorgement of profits, or
other civil or criminal penalties. Changes in government regulations or in practices relating to
the pharmaceutical and biopharmaceutical industries, including healthcare reform in China,
and compliance with new regulations may result in additional costs. Failure to comply with
these regulations could have a material adverse effect on our business, financial condition,
results of operations, and prospects.
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Even if we obtain regulatory approval for our drug candidates, we will be subject to ongoing
regulatory obligations and continued regulatory review, which may result in significant
additional expenses and we may be subject to penalties if we fail to comply with regulatory
requirements or experience unanticipated problems with our drug candidates.
If the NMPA or a comparable regulatory authority approves any of our drug candidates,
the manufacturing processes, labeling, packaging, distribution, AE reporting, storage,
advertising, promotion and record-keeping for the drug will be subject to extensive and
ongoing regulatory requirements on pharmacovigilance. These requirements include
submissions of safety and other post-marketing information and reports, registration, random
quality control testing, adherence to any CMC specifications, continued compliance with
current GMPs, and GCPs and potential post-approval studies for the purposes of license
renewal.
Even if a drug candidate were to successfully obtain marketing approval from the NMPA
or other comparable regulatory authorities in other jurisdictions, any approval might contain
significant limitations related to use restrictions for specified indications, specified age groups,
warnings, precautions, distribution or contraindications, may be subject to burdensome and
costly post-approval trials, risk management requirements or other post-marketing
commitments, or may be subject to requirement of a liable that does not include the labeling
claims necessary or desirable for the successful commercialization of that drug candidate. If we
are unable to obtain regulatory approval for one of our drug candidates in one or more
jurisdictions, or any approval contains significant limitations, we may not be able to obtain
sufficient funding to continue the development of that product or generate revenue attributable
to that drug candidate. Also, any regulatory approval of our current or future drug candidates,
even if obtained, may be withdrawn.
In addition, once a drug is approved by the NMPA or a comparable regulatory authority
for marketing, it is possible that there could be a subsequent discovery of previously unknown
problems with the drug, including problems with third-party manufacturers or manufacturing
processes, or failure to comply with regulatory requirements. If any of the foregoing occurs
with respect to our drug products, it may result in, among other things:
 restrictions on the marketing or manufacturing of the drug, withdrawal of the drug
from the market, or voluntary or mandatory drug recalls;
 fines, warning letters or holds on our clinical trials;
 refusal by the NMPA or comparable regulatory authorities to approve pending
applications or supplements to approved applications filed by us;
 suspension or revocation of existing approvals;
 refusal by the NMPA or comparable regulatory authorities to accept any of our other
IND approvals, BLAs and/or NDAs;
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 drug seizure or detention, or refusal to permit the import or export of drugs; and
 injunctions or the imposition of civil, administrative or criminal penalties.
Any government investigation of alleged violations of law could require us to expend
significant time and resources and could generate negative publicity. Moreover, regulatory
policies may change or additional government regulations may be enacted that could prevent,
limit or delay regulatory approval of our drug candidates. If we are not able to maintain
regulatory compliance, we may lose the regulatory approvals that we have already obtained and
may not achieve or sustain profitability, which in turn could significantly harm our business,
financial condition, results of operations and prospects.
Our employees, management, Directors, principal investigators and consultants may engage
in misconduct or other improper activities, including bribery, money laundering, corrupt
practices, or noncompliance with regulatory standards and requirements.
We are subject to anti-bribery, anti-corruption and anti-money laundering laws in China
and other applicable jurisdictions. As our business expands, the applicability of these laws to
our operations has increased. We could be liable for actions taken by our employees,
management or Directors that violate anti-bribery, anti-corruption, anti-money laundering or
other related laws and regulations in China and other applicable jurisdictions. We may be
subject to claims, fines, or suspension of our operations. Our reputation, our future commercial
activities or the price of our Shares could be adversely affected if our Company is associated
with any negative publicity as a result of illegal or improper actions, or allegations of illegal
or improper actions, taken by our employees, management or Directors.
We are also exposed to the risk of employee, management, Directors and third-party fraud
or other misconduct or failure to comply with applicable regulatory requirements. Misconduct
by employees could include failures to comply with regulations of the NMPA and other
comparable regulatory authorities, to provide accurate information to such regulators, to
comply with manufacturing standards we have established, to comply with healthcare fraud
and abuse laws, to report financial information or data accurately or to disclose unauthorized
activities to us. In particular, sales, marketing and other business arrangements in the
healthcare industry are subject to extensive laws and regulations intended to prevent fraud,
misconduct, kickbacks, self-dealing and other abusive practices. These laws and regulations
may restrict or prohibit a wide range of business activities, including, but not limited to,
research, manufacturing, distribution, pricing, discounting, marketing and promotion, customer
incentive programs and other business arrangements. Employee misconduct could also involve
the improper use of individually identifiable information, including, without limitation,
information obtained in the course of clinical trials, which could result in regulatory sanctions
and serious harm to our reputation.
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Legal, regulatory and administrative proceedings against any of our employees,
management, Directors, independent contractors, commercial partners and vendors, even if
they do not involve our Company, may have a material adverse effect on our reputation,
business prospects and financial results. For example, Dr. Y AO Zhengbin is our independent
non-executive Director. Dr. Y ao, in his capacity as the then chairman/chief executive
officer/president of Viela Bio, Inc. (“Viela”, Nasdaq: VIE), along with each of the former board
members of Viela, one of Viela’s large shareholders and others, was named as a co-defendant
in a class action initiated in February 2023 by certain former shareholders of Viela which
alleges various breaches of fiduciary duties in connection with the purchase of all outstanding
shares of Viela by Horizon Therapeutics PLC (Nasdaq: HZNP). As of the latest Practicable
Date, the case was dismissed with prejudice by the Court of Chancery of the State of Delaware.
Such former shareholders of Viela have appealed the decision to the Delaware Supreme Court,
where the case is currently pending.
It is not always possible to identify and deter employee, management or Directors
misconduct, and any precautions we take to detect and prevent improper activities may not be
effective in controlling unknown or unmanaged risks or losses or in protecting us from
governmental investigations or other actions or lawsuits stemming from a failure to be in
compliance with relevant laws. If any such actions are initiated against us, those actions could
have a significant impact on our business, including the imposition of significant civil, criminal
and administrative penalties, damages, monetary fines, disgorgement of profits, imprisonment,
possible exclusion from participation in government supported healthcare programs,
contractual damages, reputational harm, diminished profits and future earnings, additional
reporting or oversight obligations if we become subject to a corporate integrity agreement or
other agreement to resolve allegations of noncompliance with the law and curtailment or
restructuring of our operations, any of which could adversely affect our ability to operate.
If we fail to comply with applicable anti-bribery laws, our reputation may be harmed and we
could be subject to penalties and significant expenses that have a material adverse effect on
our business, financial condition and results of operations.
We are subject to anti-bribery laws in China and other applicable jurisdictions that
generally prohibit companies and their intermediaries from making payments to government
officials for the purpose of obtaining or retaining business or securing any other improper
advantage. Although we have policy and procedures designed to ensure that we, our employees
and our business partners comply with anti-bribery laws, there is no assurance that such policy
and procedures will prevent our business partners, employees and intermediaries from
engaging in bribery activities. Failure to comply with anti-bribery laws could disrupt our
business and lead to severe criminal and civil penalties, including imprisonment, criminal and
civil fines, loss of our export licenses, suspension of our ability to do business with the
government, denial of government reimbursement for our products and exclusion from
participation in government supported healthcare programs. Other remedial measures could
include further changes or enhancements to our procedures, policies, and controls and potential
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personnel changes and disciplinary actions, any of which could have a material adverse effect
on our business, financial condition, results of operations and liquidity. We could also be
adversely affected by any allegation that we violated such laws.
Any failure to comply with applicable regulations and industry standards or obtain various
licenses and permits could harm our reputation and our business, results of operations and
prospects. Additionally, our and/or others’ failure to obtain or renew certain approvals,
licenses, permits and certificates required for our business may materially and adversely
affect our business, financial condition and results of operations.
A number of governmental agencies or industry regulatory bodies in the PRC and other
applicable jurisdictions impose strict rules, regulations and industry standards governing
biopharmaceutical R&D activities, which apply to us. Our or our CROs’ failure to comply with
such regulations could result in the termination of ongoing research, administrative penalties
imposed by regulatory bodies or the disqualification of data for submission to regulatory
authorities. This could harm our business, reputation, prospects for future work and results of
operations.
Pursuant to the relevant laws, regulations and relevant regulatory practice by
governmental agencies, we and/or other parties related to our operations, such as landlords or
managers of premises on or local industrial parks in which we operate, are required to obtain
and maintain various approvals, licenses, permits and certificates from relevant authorities so
that we can operate our business. Some of these approvals, permits, licenses and certificates
are subject to periodic renewal and/or reassessment by the relevant authorities, and the
standards of such renewal and/or reassessment may change from time to time. Any failure to
obtain or renew any approvals, licenses, permits and certificates necessary for our operations
may result in enforcement actions thereunder, including orders issued by the relevant
regulatory authorities causing operations to cease, and may include corrective measures
requiring capital expenditure or remedial actions, which in the future could materially and
adversely affect our business, financial condition and results of operations. There is also no
assurance that the relevant authorities would not take any enforcement action against us. In the
event that such enforcement action is taken, our business operations could be materially and
adversely disrupted.
Furthermore, if the interpretation or implementation of existing laws and regulations
changes, or new regulations come into effect requiring us and/or other such relevant parties to
obtain any additional approvals, permits, licenses or certificates that were previously not
required to operate our existing businesses, we cannot assure you that we and/or other such
relevant parties will successfully obtain such approvals, permits, licenses or certificates. Our
or these parties’ failure to obtain the additional approvals, permits, licenses or certificates may
restrict the conduct of our business, decrease our revenues and/or increase our costs, which
could materially reduce our profitability and prospects.
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Failure to comply with existing or future laws and regulations related to privacy or data
security could lead to government enforcement actions, private litigation, other liabilities,
and/or adverse publicity. Compliance or the failure to comply with such laws could increase
the costs of our products and services, limit their use or adoption, and otherwise negatively
affect our operating results and business.
The regulatory framework for the collection, use, safeguarding, sharing, transfer and
other processing of personal information worldwide is rapidly evolving. Regulatory authorities
in China have implemented a number of legislative and regulatory proposals concerning data
protection. For example, the Cybersecurity Law of the PRC (),
which became effective in June 2017, created China’s first national-level data protection for
“network operators,” which may include all organizations in China that provide services over the
internet or another information network. On July 7, 2022, the CAC released the Measures on
Security Assessment of Cross-border Data Transfer (جthe “Data Export
Measures”), which came into effect on September 1, 2022. The Data Export Measures require
that any data processor provide abroad any important data collected and generated in their
business operation within the territory of the PRC and any personal information for which
security assessment is required shall apply for security assessment by the national cyberspace
administration authorities before transferring any such important data or personal information
abroad. The security assessment requirement also applies to any transfer of important data
outside of China. In addition, certain industry-specific laws and regulations govern the collection
and transfer of personal data in China. For example, the Regulations on the Administration of
Human Genetic Resources ( ɛᗳ፲ෂ༟๕၍ଣૢԷ), promulgated by the State Council in
May 2019 and became effective in July 2019, require approval from or filing with the Ministry
of Science and Technology of the People’s Republic of China where human genetic resources
(“HGR”) are involved in any international collaborative project and additional approval or filing
procedures for any export or cross-border transfer of HGR samples or associated data. It is
possible that these laws may be interpreted and applied in a manner that is inconsistent with our
practices, potentially resulting in confiscation of HGR samples and associated data and
administrative fines. In addition, the interpretation and application of data protection laws in
China and elsewhere are often uncertain and in flux. Further, the Biosecurity Law of the PRC
(), which was enacted on October 17, 2020 and became
effective on April 15, 2021, aims to strengthen the administration and supervision of the
collection, preservation, utilization and external provision of HGR and biological resources in
China so as to safeguard the security of HGR and biological resources.
On June 10, 2021, the Standing Committee of the NPC promulgated the Data Security
Law of the PRC () (the “Data Security Law”), which became
effective on September 1, 2021. The Data Security Law mainly sets forth specific provisions
regarding establishing basic systems for data security management, including graded data
classification management system, risk assessment system, monitoring and early warning
system, and emergency disposal system. In addition, it clarifies the data security protection
obligations of organizations and individuals carrying out data processing activities and
implements data security protection responsibilities. On August 20, 2021, the Standing
Committee of the NPC promulgated the Personal Information Protection Law of the PRC ( ʕ
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) (the “PIPL”) which came into effect in November 2021. In
addition to other rules and principles of personal information processing, the PIPL specifically
provides rules for processing sensitive personal information. Sensitive personal information
refers to such personal information that, once leaked or illegally used, may easily lead to the
infringement of human dignity of a natural person or may endanger such person’s personal
safety or property, including information such as biometrics, religious belief, specific identity,
medical health status, financial accounts, personal location and other information of a natural
person, as well as any personal information of a minor under the age of 14. Only where there
is a specific purpose and sufficient necessity, and under circumstances where strict protection
measures are taken, may personal information processors process sensitive personal
information. A personal information processor shall inform the individual of, in addition to
other matters prescribed by the PIPL, the necessity of processing such sensitive personal
information and the impact thereof on the individual’s rights and interests. We may store and
process sensitive personal information of our employees. If there are any changes regarding the
interpretation and implementation of the PIPL, we cannot assure you that we will comply with
the PIPL in all respects, and regulatory authorities may order us to rectify or terminate our
current practice of collecting and processing sensitive personal information. We may also
become subject to fines and/or other penalties which may have material adverse effect on our
business, operations and financial condition.
Despite our currently in place policies, standard operating procedures and in-house
trainings with respect to cyber security, data security and personal data protection, we expect
that we will continue to face uncertainty as to whether our efforts to comply with evolving
obligations under global data protection, privacy and security laws will be sufficient. Any
failure or perceived failure by us to comply with applicable laws and regulations could result
in reputational damage or proceedings or actions against us by governmental entities,
individuals or others. These proceedings or actions could subject us to significant civil or
criminal penalties and negative publicity, result in the delayed or halted transfer or confiscation
of certain personal information, require us to change our business practices, increase our costs
and materially harm our business, prospects, financial condition and results of operations. In
addition, our current and future relationships with customers, vendors, pharmaceutical partners
and other third parties could be negatively affected by any proceedings or actions against us
or current or future data protection obligations imposed on them under applicable law. In
addition, a data breach affecting personal information, including health information, could
result in significant legal and financial exposure and reputational damage that could potentially
have an adverse effect on our business. Any of the foregoing could have a material adverse
effect on our business, financial conditions, results of operations, and prospects.
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Uncertainties in the interpretation and enforcement of the Measures for Cybersecurity
Review or the Regulations on the Administration of Cyber Data Security may adversely affect
our business operations and our Listing.
On December 28, 2021, the CAC, jointly with other 12 Governmental Authorities,
promulgated the Measures for Cybersecurity Review () (the “Cyber
Review Measures”) which took effect on February 15, 2022. Pursuant to Article 2 of the Cyber
Review Measures, critical information infrastructure operators purchasing internet products
and services and online platform operators engaging in data processing activities, which affect
or may affect national security, shall be subject to the cybersecurity review. Pursuant to the
Cyber Review Measures, an online platform operator which possesses personal information of
over one million users and intends to “list in a foreign country ( ਷̮ɪ̹)” shall be subject to
cybersecurity review. For more details, see “Regulatory Environment – Other Significant
Regulations of the PRC Affecting Our Business – Information Security and Privacy
Protection.” Any failure or delay in the completion of the cybersecurity review under
Cybersecurity Review Measures, or other non-compliance with the relevant cybersecurity laws
and regulations, may result in administrative penalties, including fines, a shut-down of our
business, as well as reputational damage or legal proceedings or actions against us, which may
have material adverse effects on our business, financial condition or results of operations.
As of the Latest Practicable Date, (i) to the best knowledge of our Directors, we had not
been determined or identified as a critical information infrastructure operator by any
Governmental Authorities; (ii) to the best knowledge of our Directors, we had not engaged in
any data processing activities that affect or may affect national security according to the
applicable PRC laws; (iii) we had not been involved in any investigations on cybersecurity
review made by CAC, and had not received any inquiry, notice, warning or sanctions in this
regard, our PRC Legal Adviser is of the view that it is unlikely that we would be determined
or identified as a critical information infrastructure operator as long as there is no material
change to the current PRC legal system and regulatory framework in terms of cyber security
and data security and the Group’s current business, and thus we have no obligation to
proactively apply for cybersecurity review under the Cyber Review Measures.
However, the Cyber Review Measures provides no further explanation or interpretation
for “online platform operator”, and does not stipulate that an online platform operator which
intends to list in Hong Kong shall be subject to cybersecurity review. Given that the expression
used in the Cyber Review Measures is “list in a foreign country” and Hong Kong is not a
country or region outside of the PRC, our PRC Legal Adviser is of the view that we have no
obligation to proactively apply for cybersecurity review for our application for our proposed
Listing under the Cyber Review Measures.
However, the Cyber Review Measures also grants the member organization of the
cybersecurity review mechanism the right to initiate cyber security review without application,
if any of them has reason to believe that any internet products, services or data processing
activities affect or may affect national security. The PRC Governmental Authorities may have
broad discretion in the interpretation of “affect or may affect national security.” If any internet
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products, services or data processing activities of us are deemed to “affect or may affect
national security” by the PRC Governmental Authorities under its broad discretion, we may be
subject to cybersecurity review. If we fail to pass such cybersecurity review, our Listing may
be impeded and/or our business operations may be adversely affected.
On September 30, 2024, the Administration Regulations on Cyber Data Security ( ၣഖ
ᅰኽτΌ၍ଣૢԷ) (the “Data Security Regulations”) was promulgated by the State
Council, which came into effect on January 1, 2025. The Data Security Regulations reiterate
and refine the general regulations for cyber data processing activities, rules of personal
information protection, important data security protection, cyber data cross-border transfer
management, and the responsibilities of online platform service providers. In particular, the
Data Security Regulations provide that cyber data processors whose cyber data processing
activities affect or may affect national security shall be subject to national security review in
accordance with the relevant regulations. However, the Data Security Regulations provide no
further explanation or interpretation for the criteria on determining the risks that “affect or may
affect national security”. Additionally, since the Data Security Regulations are still relatively
new, the interpretation and implementation of these regulations may further evolve and
develop.
As advised by our PRC Legal Adviser, the PRC Governmental Authorities may have wide
discretion in the interpretation of “affect or may affect national security.” Further, if we were
deemed as a data processor that “affects or may affect national security” by the PRC
Governmental Authorities under its broad discretion, we may be subject to cybersecurity
review. If we fail to pass such cybersecurity review, our Listing may be impeded, our business
operations may be adversely affected, and/or we may be subject to other severe penalties and/or
action by the competent Governmental Authority.
If we face allegations of non-compliance with laws and encounter sanctions, our reputation,
revenues and liquidity may suffer, and our drug candidates and future products could be
subject to restrictions or withdrawal from the market.
Any government investigation of alleged violations of laws could require us to expend
significant time and resources in response, and could generate negative publicity. Any failure
to comply with ongoing regulatory requirements may significantly and adversely affect our
ability to commercialize and generate revenues from our drug candidates. If regulatory
sanctions are applied or if regulatory approval is withdrawn, the value of our Company and our
operating results will be adversely affected. Additionally, if we are unable to generate revenues
from our product sales, our potential for achieving profitability will be diminished and the
capital necessary to fund our operations will be increased.
If we fail to comply with environmental, health and safety laws and regulations, we could
become subject to fines, penalties or damages or incur costs that could have a material
adverse effect on the success of our business.
We are subject to numerous environmental, health and safety laws and regulations,
including those governing laboratory procedures and the handling, use, storage, treatment and
disposal of hazardous materials and wastes.
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So far, our operations have not produced any hazardous waste products, however we may
produce or be in connection with these materials in the future and we may not be able to
eliminate the risk of contamination or injury from these materials. We could incur significant
costs associated with civil or criminal fines and penalties for failure to comply with such laws
and regulations and any harms or damages resulting therefrom. In addition, pursuant to
applicable PRC laws and regulations, if we do not complete all required approval, filings, and
related procedures in connection with fire prevention, environmental protection, construction
and safety production in a timely manner, we could be subject to investigations, suspension of
operations, fines and other administrative penalties by competent authorities.
Furthermore, we are subject to numerous international, national, municipal and local
environmental, health and safety laws and regulations relating to, among other matters, safe
working conditions, product stewardship and environmental protection. However,
environmental, health and safety laws and regulations have tended to become increasingly
stringent and, to the extent regulatory changes occur in the future, they could result in, among
other things, increased costs to our Company.
In addition, we may incur substantial costs in order to comply with current or future
environmental, health and safety laws and regulations. These current or future laws and
regulations may impair our research, development or production efforts. Our failure to comply
with these laws and regulations also may result in substantial fines, penalties or other
sanctions.
We are subject to changing law and regulations regarding regulatory matters, corporate
governance and public disclosure that have increased both our costs and the risk of
non-compliance.
We are or will be subject to rules and regulations by various governing bodies, including,
for example, once we have become a public company, the Stock Exchange and the SFC, which
are charged with the protection of investors and the oversight of companies whose securities
are publicly traded, as well as the various regulatory authorities in China and the Cayman
Islands, and to new and evolving regulatory measures under applicable law. Our efforts to
comply with new and changing laws and regulations have resulted in, and are likely to continue
to result in, increased general and administrative expenses and a diversion of management time
and attention from revenue-generating activities to compliance activities.
Moreover, because these laws, regulations and standards are subject to varying
interpretations, their application in practice may evolve over time as new guidance becomes
available. This evolution may result in continuing uncertainty regarding compliance matters
and additional costs necessitated by ongoing revisions to our disclosure and governance
practices. If we fail to address and comply with these regulations and any subsequent changes,
we may be subject to penalties and our business may be harmed.
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We are subject to changing law and regulations regarding advertising and promotion of
pharmaceutical products, and the increasing use of social media platforms presents new
risks and challenges of non-compliance with regulations applicable to our business.
Drug advertisements are subject to strict content restrictions, which prohibit
recommendations by doctors and hospitals and guarantees of effectiveness. Advertising that
includes content that is outside of the drug’s approval documentation, off-label content, is
prohibited. False advertising can result in civil suits from end users and administrative liability,
including fines. In addition to advertisements, non-promotional websites that convey
information about a drug must go through a separate approval process by a local drug
regulatory authority.
Social media are increasingly being used to communicate about the diseases that our drug
candidates are designed to treat. Social media practices in the biopharmaceutical industry
continue to evolve and regulations relating to such use are not always clear. This evolution
creates uncertainty and risk of non-compliance with regulations applicable to our business. For
example, patients may use social media channels to comment on the effectiveness of a product
or to report an alleged AE. In order to collect potential AEs reported via social media, we
intends to set up a program, which involves review of user generated content, such as
comments posted on message boards, social media channels, or blogs. Nevertheless, when such
an incident occurs, there is a risk that we fail to monitor and comply with applicable reporting
obligations or we may not be able to defend our own or the public’s legitimate interests in the
face of the political and market pressures generated by social media due to restrictions on what
we may say about our drug candidates. There is also a risk of inappropriate disclosure of
sensitive information or negative or inaccurate posts or comments about us on any social
networking website. While we are not aware of any such events, if any of these events occur
in the future or we otherwise fail to comply with applicable regulations, we may incur liability,
face overly restrictive regulatory actions or incur other harm to our business.
OTHER RISKS RELATED TO MANUFACTURING AND COMMERCIALIZATION OF
OUR DRUG CANDIDATES
Coverage and adequate reimbursement may not be available for our current or any future
drug candidates which could make it difficult for us to sell profitably, if approved. Even if
reimbursement is available, we may need to significantly concede on prices for our future
approved drugs in China and face uncertainty of profitability.
Our ability to commercialize any drug candidates successfully also will depend in part on
the extent to which reimbursement for these drugs and related treatments will be available from
government health administration authorities, private health insurers and other organizations.
Government authorities and third-party payors, such as private health insurers and health
maintenance organizations, decide which medications they will pay for and establish
reimbursement levels. A primary trend in the global healthcare industry is cost containment.
Government authorities and these third-party payors have attempted to control costs by
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limiting coverage and the amount of reimbursement for particular medications. Increasingly,
third-party payors are requiring that companies provide them with predetermined discounts
from list prices and are challenging the prices charged for medical products. We cannot be sure
that coverage and reimbursement in China or elsewhere will be available for any product that
we may develop, and any reimbursement that may become available may be decreased or
eliminated in the future. Even if favorable coverage and reimbursement status is attained for
one or more drug candidates for which we receive regulatory approval, less favorable coverage
policies and reimbursement rates may be implemented in the future. As the regulations that
govern regulatory approvals, pricing and reimbursement for new therapeutic products vary
widely from jurisdiction to jurisdiction, we might obtain regulatory approval for a drug
candidate in a particular jurisdiction, but then be subject to price regulations that delay our
commercial launch of the same drug candidate and reduce the revenues we are able to generate
from the sale of the drug candidate in that jurisdictions. Inadequate coverage and
reimbursement may impact the demand for, or the price of, any drug for which we obtain
marketing approval. If coverage and adequate reimbursement are not available, or are available
only to limited levels, we may not be able to successfully commercialize our current and any
future drug candidates that we develop.
Additionally, there may be significant delays in obtaining reimbursement for approved
drug candidates, and coverage may be more limited than the approved indications. Moreover,
eligibility for reimbursement does not imply that any drug will be paid for in all cases or at a
rate that covers our costs, including research, development, manufacture, sale and distribution.
Interim payments for new drugs, if applicable, may also not be sufficient to cover our costs and
may not be made permanent. Payment rates may vary according to the use of the drug and the
clinical setting in which it is used, may be based on payments allowed for lower cost drugs that
are already reimbursed, and may be incorporated into existing payments for other services. Net
prices for drugs may be reduced by mandatory discounts or rebates required by government
healthcare programs or private payors and by any weakening of laws that restrict imports of
drugs from countries where they may be sold at lower prices than in the markets we address.
Inability to promptly obtain coverage and profitable payment rates from both government-
funded healthcare programs and private payors for any future approved drug candidates and
any new drugs that we develop could have a material adverse effect on our business, our
operating results, and our overall financial condition.
In China, the National Healthcare Security Administration, the Ministry of Human
Resources and Social Security of the PRC (the “MHRSS”) or provincial or local human
resources and social security authorities, together with other Governmental Authorities, review
the inclusion or removal of drugs from the China’s National Drug Catalogue for Basic Medical
Insurance, Work-related Injury Insurance and Maternity Insurance, the NRDL, or provincial or
local medical insurance catalogues for the PRDL, regularly, and the tier under which a drug
will be classified, both of which affect the amounts reimbursable to program participants for
their purchases of those drugs. There can be no assurance that any of our future approved drug
candidates will be included in the NRDL or the PRDL. If we were to successfully launch
commercial sales of our products in China but fail in our efforts to have our products included
in the NRDL or PRDL, our revenue from commercial sales in China will be highly dependent
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on patient self-payment or private insurance coverage, which can make our products less
competitive. Additionally, even if the MHRSS or any of its local counterparts and other
Governmental Authorities accept our application for the inclusion of products in the NRDL or
PRDL, our potential revenue from the sales of these products in China could still decrease as
a result of changes in pricing regulations that could potentially restrict or significantly lower
the prices we are able to charge for our products to be included in the NRDL or PRDL.
The manufacture of biopharmaceutical products is a complex process which requires
significant expertise and capital investment. We may not be able to successfully establish
collaboration with local CDMO as planned or develop our own manufacturing infrastructure
for supply of our requirements of our drug candidates for commercial sale.
We plan to establish localized manufacturing capabilities for lonapegsomatropin in China
to address the vast domestic market potentials in China (including Hong Kong, Macau and
Taiwan) effectively and secure sustainable drug supply for local patients. In the short term, we
plan to source the commercial drug supply from our collaboration partner, Ascendis Pharma.
We have successfully reached a commercial supply agreement for the commercial supply of the
Core Product by Ascendis Pharma in October 2023. Please refer to “Connected Transactions”
for more details. In the medium term, we intend to collaborate with WuXi Biologics, our
designated local CDMO in China, for the commercial production of lonapegsomatropin. In July
2023, we entered into the Technology Transfer Master Plan of the Core Product with Ascendis
Pharma, signifying the commencement of Technology Transfer from Ascendis Pharma to us for
the manufacturing of the Core Product. In December 2023, we entered into a collaboration
agreement with the WuXi Biologics, pursuant to which WuXi Biologics will serve as the local
CDMO of the Technology Transfer to conduct the process development and validation
achieving the localization of the manufacturing technology. Completion of the Technology
Transfer and Localization, which is expected to be in 2027, will confer to us the technical
capabilities to manufacture the Core Product drug substance in collaboration with WuXi
Biologics. We are also developing the DCD technology in the form of prefilled syringe as a
drug delivery system for the Core Product drug substance. Once this development is finished,
WuXi Biologics will have the capability to produce the Core Product. For more information
regarding the DCD, please refer to “Business – Research and Development – CMC
Development Programs – Dual Chamber Device Technology Development.” The
commercialization of the Core Product manufactured by WuXi Biologics will start once we
obtain the approval of Local BLA, which is expected to occur in 2028. We expect to procure
the Core Product from Ascendis Pharma for the commercial supply until 2028 following our
anticipated commercialization activities in late 2025 after BLA approval. In the long term, we
plan to establish our in-house manufacturing capabilities.
However, we have limited experience as a company in designing and operating a
commercial manufacturing facility and may never be successful in developing new
manufacturing capability either on our own or together with a third-party on a commercial
scale. If our technology transfer from Ascendis Pharma in connection with CMC is delayed, our
efforts in collaborating with the designated local CDMO establishing manufacturing and
commercialization capacity may also be delayed. In terms of cooperation with local CDMO,
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the designated local CDMO might be unable to timely set up the capabilities necessary for the
manufacture and delivery of our drug candidates. Also, our designated local CDMO might face
issues (including problems with manufacturing, supply chain, infringement, compliance with
GMP and capacity) or failure to comply with relevant laws and regulations in the future, which
may have an adverse impact on us. In addition, the investment for building our in-house
manufacturing facilities in the future may also be a significant upfront cost for us. In turn, this
could materially harm our commercialization plans. If construction or regulatory approval of
our manufacturing facilities is delayed, we may not be able to manufacture sufficient quantities
of our drug candidates, which would limit our development activities and our opportunities for
growth.
In addition, problems may arise during the manufacturing process for a variety of reasons,
including equipment malfunction, failure to follow specific protocols and procedures,
problems with raw materials, delays related to the construction of new facilities or expansion
of any future manufacturing facilities, including changes in manufacturing production sites and
limits to manufacturing capacity due to regulatory requirements, changes in the types of
products produced, increases in the prices of raw materials, physical limitations that could
inhibit continuous supply, man-made or natural disasters, environmental factors or other
factors that may be beyond our control. If problems arise during the production of a batch of
future products, that batch of future products may have to be discarded and we may experience
product shortages or incur added expenses. This could, among other things, lead to increased
costs, lost revenue, damage to customer relationships, time and expense spent investigating the
cause and, depending on the cause, similar losses with respect to other batches or products. If
problems are not discovered before such product is released to the market, recall and product
liability costs may also be incurred. We may also from time to time optimize our method of
manufacturing, including CMC processes, and such changes carry the risk that they will not
achieve intended objectives. Any of these changes could cause our drug candidates to perform
differently and affect the results of future clinical trials conducted with the altered materials
manufactured in-house. This could delay completion of clinical trials, require the conduct of
bridging clinical trials or the repetition of one or more clinical trials, increase clinical trial
costs, delay approval of our drug candidates and jeopardize our ability to commercialize our
drug candidates and generate revenue. Even if we are successful, the manufacturing operations
could be affected by cost-overruns, unexpected delays, equipment failures, labor shortages,
natural disasters, power failures and numerous other factors which may be beyond our control,
or we may not be successful in establishing sufficient capacity to produce our drug candidates
in sufficient quantities to meet the requirements for the potential launch or to meet potential
future demand, all of which could prevent us from realizing the intended benefits of our
manufacturing strategy and have a material adverse effect on our business.
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As we may in the future establish in-house manufacturing facilities, delays in completing
and receiving regulatory approvals for such facilities could delay our development plans or
commercialization efforts, which could harm our business.
In the future, we may establish our in-house manufacturing facilities, such facilities will
be subject to ongoing, periodic inspection by various regulatory authorities, including the
FDA, the EMA, the NMPA or other comparable regulatory agencies to ensure compliance with
GMP . Our failure to follow and document our adherence to such GMP or other regulatory
requirements may lead to significant delays in the availability of products for clinical or, if
approved, commercial use, and may result in the termination of or a hold on a clinical trial, or
may delay or prevent filing or approval of marketing applications for our drug candidates or
the commercialization of our drugs, if approved. We also may encounter problems with the
following:
 achieving adequate or clinical-grade materials that meet FDA, EMA, NMPA, or
other comparable regulatory agency standards or specifications with consistent and
acceptable production yield and costs;
 shortages of qualified personnel, raw materials or key contractors; and
 ongoing compliance with GMP and other requirements of the FDA, EMA, NMPA,
or other comparable regulatory agencies.
Failure to comply with applicable regulations could also result in sanctions being imposed
on us, including fines, injunctions, civil penalties, suspension of or halt on one or more of our
clinical trials, failure to receive from regulatory authorities marketing approval of our drug
candidates, delays, suspension or withdrawal of approvals, supply disruptions, license
revocation, seizures, or recalls of our drug candidates, operating restrictions and civil or
criminal prosecutions, any of which could harm our business.
We may not be successful in achieving cost of goods at commercial scale that provides for
an attractive margin.
We have entered into the Technology Transfer Master Plan of lonapegsomatropin with
Ascendis Pharma in July 2023 which outlines the implementation plan to transfer the
manufacturing technology of lonapegsomatropin from Ascendis Pharma to our Company.
Completion of the Technology Transfer and Localization, which is expected to be in 2027, will
confer us the technical capabilities to manufacture the lonapegsomatropin drug substance in
collaboration with WuXi Biologics. We expect the transitioning of our supply chain to local
production will enable us to better control the quality and consistency of the supply of our drug
candidates and improve the certainty and cost-effectiveness of production. However, we make
no guarantee that we can successfully obtain necessary drug manufacturing licenses or
establish a manufacturing capacity at sufficient commercial scale or at all. Local production of
drug products will be subject to standards and requirements by various regulatory authorities,
including the FDA, the EMA, the NMPA or other comparable regulatory agencies to ensure
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compliance with GMP . We may underestimate the cost and time required to establish the
manufacturing facility, or overestimate cost reductions from economies of scale that can be
realized with our manufacturing processes. We may not be able to ultimately manage the cost
of goods for our drug candidates to levels that will allow for a margin in line with our
expectations and return on investment if and when those drug candidates are commercialized.
Product liability lawsuits against us could cause us to incur substantial liabilities and to limit
commercialization of any products that we may develop.
We face an inherent risk of product liability exposure related to the testing of our drug
candidates in human clinical trials and will face an even greater risk if we commercially sell
any products that we may develop. If we cannot successfully defend ourselves against claims
that our drug candidates or products caused injuries, we will incur substantial liabilities.
Regardless of merit or eventual outcome, liability claims may result in:
 reduced resources of our management to pursue our business strategy;
 decreased demand for any drug candidates or products that we may develop;
 injury to our reputation and significant negative media attention;
 withdrawal of clinical trial participants;
 initiation of investigations by regulators;
 product recalls, withdrawals or labeling, marketing or promotional restrictions;
 significant costs to defend the resulting litigation;
 substantial monetary awards paid to clinical trial participants or patients;
 loss of revenue; and
 the inability to commercialize any products that we may develop.
While we maintain clinical trial insurance, which covers certain bodily injury or damage
in connection with our clinical trials for our drug candidates, our insurance coverage may not
be adequate to cover all liabilities that we may incur. We may need to increase our insurance
coverage as we expand our clinical trials or if we commence commercialization of our drug
candidates. Insurance coverage is increasingly expensive. We may not be able to maintain
insurance coverage at a reasonable cost or in an amount adequate to satisfy any liability that
may arise.
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The incidence and prevalence for target patient populations of our drug candidates are based
on estimates and third-party sources. If the market opportunities for our drug candidates are
smaller than we estimate or if any approval that we obtain is based on a narrower definition
of the patient population, our revenue and ability to achieve profitability might be materially
and adversely affected.
We currently focus our drug development on drug candidates for the treatment of
endocrine diseases in China (including Hong Kong, Macau and Taiwan). Our eligible patient
population and pricing estimates may differ significantly from the actual market addressable
by our drug candidates. Our estimates of both the number of people who have these diseases,
as well as the subset of people with these diseases who have the potential to benefit from
treatment with our drug candidates, are based on our beliefs and analyses. These estimates have
been derived from a variety of sources, including the scientific literature, patient foundations
or market research, and may prove to be incorrect. Further, new studies may change the
estimated incidence or prevalence of the diseases we are targeting. The number of patients may
turn out to be lower than expected. Likewise, the potentially addressable patient population for
each of our drug candidates may be limited or may not be receptive to treatment with our drug
candidates, and new patients may become increasingly difficult to identify or access. If the
market opportunities for our drug candidates are smaller than we estimate, we may not be able
to achieve our forecasted revenue, which could hinder our business plan and adversely affect
our business and results of operations.
RISKS RELATED TO OUR BUSINESS OPERATIONS
Changing PRC regulatory framework on overseas approved products may have negative
impact on companies adopting in-licensing business model.
The drug market is heavily regulated in China. Changes in government regulations or in
practices relating to the pharmaceutical and biopharmaceutical industries, such as a relaxation
in regulatory requirements, or the introduction of simplified approval procedures which will
lower the entry barrier for potential competitors, or an increase in regulatory requirements
which may increase the difficulty for us to satisfy such requirements, may have a material
adverse impact on our business, financial condition, results of operations and prospects. In
particular, under current PRC regulatory requirements, to introduce a drug approved overseas
to the China market, the drug must repeat a registrational study in China that is either a fully
powered study or a bridging study. By engaging us, foreign pharmaceutical or
biopharmaceutical companies will be able to conduct a parallel registrational study in China or
a global study that includes China, thereby substantially reducing the time and cost required
to introduce drugs to the China market. If China streamlines, expedites or simplifies such
regulatory procedures, foreign pharmaceutical or biopharmaceutical companies’ demand for
collaboration partnerships with local partners with an in-licensing business model like us may
decrease, which would have a material adverse effect on our business, financial condition,
results of operations and prospects.
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We may be unable to attract and retain senior management and retain qualified and highly
skilled employees especially R&D and clinical related staff.
We are highly dependent on the expertise of our senior management as well as our other
key employees. Although we have entered into employment agreements with all of our
executive officers, each of them may terminate their employment with us at any time with
30 days’ prior written notice.
Recruiting and retaining qualified management, scientific, clinical, manufacturing and
medical personnel will also be critical to our success. Loss of the services of our executive
officers or other key employees could impede the achievement of our research, development,
manufacturing and commercialization objectives and seriously harm our ability to successfully
implement our business strategy. Further, replacing executive officers and key employees may
be difficult and may take an extended period of time because of the limited number of
individuals in our industry with the breadth of skills and experience required to successfully
develop, gain regulatory approval of and commercialize drugs. Competition to hire from this
limited pool is intense, especially given the R&D climate for innovative medicines in China,
and we may be unable to hire, train, retain or motivate these key personnel on acceptable terms
given the competition among numerous biopharmaceutical companies for similar personnel.
We also experience competition for the hiring of scientific and clinical personnel from
universities, research institutions and hospitals. In addition, our management will be required
to devote significant time to new compliance initiatives after we become a public company,
which may require us to recruit more management personnel.
Our business and reputation may be adversely affected by negative publicity involving us,
our Shareholders, Directors, officers, employees, suppliers or other third parties that we
work with or rely on. Our ability to maintain our reputation is critical to the success of our
business, and the failure to do so may materially and adversely affect our business and the
value of our Shares.
Our reputation is a valuable component of our business. We, our Shareholders, Directors,
officers, employees, partners, or other third parties we cooperate with or rely on may be subject
to negative media coverage and publicity from time to time. Such negative coverage in the
media and publicity could threaten the perception of our reputation. In addition, to the extent
our employees, partners or other third parties we work with or rely on were non-compliant with
any laws or regulations, we may also suffer negative publicity or harm to our reputation. As
a result, we may be required to spend significant time and incur substantial costs in response
to allegations and negative publicity that may or may not directly related to us, and may not
be able to diffuse them to the satisfaction of our current or future investors, customers, patients
and business partners. Any negative publicity and allegations regarding our clinical trials,
operations, Shareholders, Directors, officers, employees or partners, with or without merit,
may result in a material adverse impact on our operations, prospects and Shares.
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We may not realize the benefits of existing and future collaborations, strategic alliances or
licensing arrangements, and may form or seek collaborations or strategic alliances or enter
into additional licensing arrangements in the future.
We have entered into exclusive license agreements with Ascendis Pharma with respect to
our current drug candidates. We may form or seek additional alliances, create joint ventures or
collaborations or enter into additional licensing agreements with third parties in the future that
we believe will complement or augment our development and commercialization efforts with
respect to our existing and potential future drug candidates. Any of these relationships may
require us to incur recurring or non-recurring expenses and other charges, increase our near and
long-term expenditures, issue securities that dilute the value of our Shares, or disrupt our
management and business.
We may face significant competition in seeking appropriate strategic partners and the
negotiation process can be time-consuming and complex. Moreover, we may not be successful
in our efforts to establish strategic partnerships or other arrangements for our current and future
drug candidates for various reasons, including that we may not have the necessary expertise or
resources for the partner to grant us the rights we are seeking, whether related to a new or
existing drug candidate we are developing. If and when we collaborate with a third-party for
the development and commercialization of a drug candidate, we can expect to relinquish some
or all of the control over the future success of that drug candidate to the third-party.
Further, collaborations involving our drug candidates are subject to specific risks,
such as:
 collaborators may have significant discretion in determining the efforts and
resources that they will apply to a collaboration;
 collaborators may not pursue the development and commercialization of our drug
candidates or may elect not to continue or renew development or commercialization
programs based on clinical trial results, changes in their strategic focus, changes in
their pricing strategy, availability of funding, or other factors, such as a business
combination or change of control that diverts resources or creates competing
priorities;
 collaborators may delay clinical trials, provide insufficient funding for a clinical
trial, discontinue a clinical trial, repeat or conduct new clinical trials, or require a
new formulation of a drug candidate for clinical testing;
 collaborators could independently develop, or develop with third parties, drugs that
compete directly or indirectly with our drug candidates or future drugs;
 collaborators with development, marketing and distribution rights to one or more of
our drug candidates or future drugs may not commit sufficient resources to these
activities;
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 collaborators may not properly maintain, enforce or defend our owned or in-licensed
intellectual property rights or may use our intellectual property or proprietary
information in a way that gives rise to actual or threatened litigation that could
jeopardize or invalidate such intellectual property or other proprietary information
or expose us to potential liability;
 collaborators may infringe, misappropriate or otherwise violate the intellectual
property or proprietary rights of third parties, which may expose us to litigation and
potential liability;
 collaborators may not always be cooperative or responsive in providing their
services in a clinical trial;
 disputes may arise between us and a collaborator that cause the delay or termination
of the research, development or commercialization of our drug candidates, or that
result in costly litigation or arbitration that diverts management attention and
resources;
 collaborators may enter into change of control and other transactions, which may
divert the attention of their management from ordinary operating matters and disrupt
their business related to our drug candidates;
 collaborations may be terminated and, if terminated, may result in a need for
additional capital to pursue further development or commercialization of the
applicable drug candidates;
 the collaboration may result in increased operating expenses or the assumption of
indebtedness or contingent liabilities; and
 collaborators may own or co-own intellectual property covering our drug candidates
or future drugs that results from us collaborating with them, and in such cases, we
may not have the exclusive right to commercialize such intellectual property.
As a result, if we enter into collaboration agreements, license agreements or other
strategic partnerships, we may not be able to realize the benefit of such transactions if we are
unable to successfully integrate these agreements or partnerships with our existing operations
and company culture, which could delay our timelines or otherwise adversely affect our
business.
We also cannot be certain that, following a collaboration, license or other strategic
transaction, we will be able to achieve the revenue or specific net income that justifies such
transaction. If we are unable to reach agreements with suitable collaborators on a timely basis,
on acceptable terms, or at all, we may have to curtail the development of a drug candidate,
reduce or delay its development program or one or more of our other development programs,
delay its potential commercialization or reduce the scope of any medical activities in
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accordance with local rules and regulations, or increase our expenditures and undertake
development or commercialization activities at our own expense. If we elect to fund and
undertake development or commercialization activities on our own, we may need to obtain
additional expertise and additional capital, which may not be available to us on a timely basis,
on acceptable terms, or at all. If we fail to enter into collaborations and do not have sufficient
funds or expertise to undertake the necessary development and commercialization activities,
we may not be able to further develop our drug candidates or bring them to market and generate
product sales revenue, which would harm our business, financial condition, results of
operations and prospects.
If we engage in future acquisitions or strategic partnerships, this may increase our capital
requirements, dilute the value of your investment in our Shares, cause us to incur debt or
assume contingent liabilities, and subject us to other risks.
From time to time, we may evaluate various acquisitions and strategic collaborations,
including licensing or acquiring complementary products, intellectual property rights,
technologies or businesses, as we may deem appropriate to carry out our business plan. Any
potential acquisition or strategic collaboration may entail numerous risks, including:
 increased operating expenses and cash requirements;
 the assumption of additional indebtedness or contingent liabilities;
 dilution to our existing Shareholders from our issuance of additional equity
securities;
 the diversion of our management’s attention from our existing product programs and
initiatives in pursuing such a strategic merger or acquisition;
 loss of key personnel, and uncertainties in our ability to maintain key business
relationships;
 risks and uncertainties associated with the assimilation of operations, corporate
culture intellectual property, products and personnel of the acquired company or
business;
 risks and uncertainties associated with the other party to such a transaction,
including the prospects of that party and its existing products or drug candidates and
regulatory approvals; and
 inability to generate revenue from acquired technology or products sufficient to
meet our objectives in undertaking the acquisition or even to offset the associated
acquisition and maintenance costs.
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Additionally, if we undertake acquisitions, we may issue dilutive securities, assume or
incur debt obligations, incur large onetime expenses and acquire intangible assets that could
result in significant future amortization expenses. Moreover, we may not be able to locate
suitable acquisition opportunities and this inability could impair our ability to grow or obtain
access to technology or products that may be important to the development of our business.
An occurrence of a natural disaster, widespread health epidemic or other outbreaks could
have a material adverse effect on our business, financial condition and results of operations.
Our business could be materially and adversely affected by natural disasters, such as
snowstorms, earthquakes, fires or floods, the outbreak of a widespread health epidemic, such
as swine flu, avian influenza, SARS, Ebola, Zika, COVID-19 or other events, such as wars, acts
of terrorism, environmental accidents, power shortage or communication interruptions. The
occurrence of a disaster or a prolonged outbreak of an epidemic illness or other adverse public
health developments in China or elsewhere in the world could materially disrupt our business
and operations.
For example, there has been an outbreak of COVID-19. The disease quickly spread
globally and materially and adversely affected the global economy. The outbreak and
government measures taken in response have also had a significant impact, both directly and
indirectly, on businesses: supply chains have been disrupted; facilities and production have
been suspended; and demand for certain goods and services, such as medical services and
supplies, has spiked. Our patient enrollment was temporarily put on hold for a few months
during the clinical trial sites lockdown as a result of COVID-19. Although we quickly resumed
patient enrollment and brought our patient enrollment plan back on track after the spread of
COVID-19 was contained in China without any early termination or suspension of our clinical
trials, there is no guarantee that we would not in the future experience disruptions that could
severely impact our business and clinical trials for our current and future drug candidates.
Securities litigation or other litigation against Ascendis Pharma or other collaboration
partners could cause substantial damages to them and may impact our collaboration.
All of our current drug candidates are in-licensed from Ascendis Pharma, a company
listed on the Nasdaq Stock Market in the United States. Public companies, especially those in
the United States, often face securities class action litigation for alleged material misstatements
and omissions relating to public disclosure following a decline in the share price of their
securities. From time to time, Ascendis Pharma or our future public company collaboration
partners may be targets of such litigations. The outcome of such litigations is necessarily
uncertain and any of Ascendis Pharma and our future collaboration partners may have to pay
substantial monetary damages in relation to such lawsuits. In the extreme scenario where any
of our collaboration partners becomes insolvent and faces liquidation as a result of the lawsuits
against them, its business and collaboration with us may be negatively affected.
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We will need to increase the size and capabilities of our organization, and we may experience
difficulties in managing our growth.
As of the Latest Practicable Date, we employed a total of 52 full-time employees. As our
development and commercialization plans and strategies to expand and develop, and as we
transition into operating as a public company, we expect to need additional managerial,
operational, financial and other personnel, including personnel to support our product
development and planned future commercialization efforts. Future growth will impose
significant added responsibilities on members of management, including:
 identifying, recruiting, integrating, maintaining and motivating additional
employees;
 managing our internal product development efforts effectively, including the clinical
and NMPA, review processes for our drug candidates; and
 improving our operational, financial and management controls, reporting systems
and procedures.
There are a small number of individuals with experience in endocrine therapies and the
competition for these individuals is high. Our future financial performance and our ability to
commercialize our drug candidates will depend, in part, on our ability to effectively manage
any future growth, and our management may also have to divert a disproportionate amount of
its attention away from day-to-day activities in order to devote a substantial amount of time to
managing these growth activities.
If we are not able to effectively expand our organization by hiring new employees, we
may not be able to successfully implement the tasks necessary to further develop and
commercialize our drug candidates and, accordingly, may not achieve our research,
development and commercialization goals.
In addition to expanding our organization, we are increasing the size of our facilities and
building out our development and manufacturing capabilities through collaborating with the
designated local CDMO, which requires significant capital expenditures and technology. If
these capital expenditures are higher than expected, it may adversely affect our financial
condition and capital resources. In addition, if the increase in the size of our facilities is
delayed, it may limit our ability to rapidly expand the size of our organization in order to meet
our corporate goals.
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We may in the future be subject to disputes, legal proceedings or arbitration claims in the
ordinary course of our business, and the court ruling or arbitration award may not be
favorable to us.
We are subject to a variety of dispute risks, including, but not limited to, license
agreement disputes, personal-injury claims, environmental claims, employee allegations of
improper termination, land and property rights disputes. Such claims may increase our cost of
operations and adversely affect our profitability, and may therefore limit the funds available to
us for our business operations, which in turn could adversely affect our operating results and
negative impact our brand image. In some instances, we may elect or be forced to pay
substantial damages if we are unsuccessful in our efforts to defend against these disputes,
which could harm our business.
For example, in connection with our prior plan to build our in-house manufacturing
capabilities, we entered into a Supervision Agreement on Investment and Development ( ᘽψ
္၍՘ᙄ) (the “Supervision Agreement”) with the Suzhou Industrial Park
Administration Committee in December 2021, and a State-owned Construction Land Use Right
Transfer Agreement (ண͜ήԴ͜ᛆ̈ᜫΥΝ) (the “Land Use Right Transfer
Agreement”, together with the Supervision Agreement, collectively as the “Land Related
Agreements”) with the Suzhou Industrial Park Planning and Construction Committee in
January 2022. Pursuant to the foregoing agreements, we made payment of RMB9.2 million
(including the land deposit of RMB1.8 million) and acquired land use rights of approximately
25,000 square meters in Suzhou and the terms of such land use rights are 30 years. In light of
the challenging fundraising environment, and considering the potential capital needs to build
an in-house factory, we decided to adjust our commercial supply strategy by initially
establishing local production capacity through cooperation with WuXi Biologics, the local
CDMO in China, which would be faster and require less upfront capital investment than
building an in-house manufacturing facility. By doing so, we can realize local production
earlier while substantially reducing the initial capital investment. As such, on November 2,
2023, we exercised the termination right under the Land Use Right Transfer Agreement and
submitted an application of land return with relevant governmental authorities of Suzhou
Industrial Park, requesting the termination of the Land Related Agreements and returning of the
land use rights to Suzhou Industrial Park Administration Committee. In relation to the land
return, upon approval of land return by relevant governmental authorities, we may incur a
termination loss of approximately RMB1.8 million due to the non-refundable nature of the land
deposit, and after communication, we have been informed by the relevant governmental
authorities that land reclamation is needed to get the approval of land return. We entered into
a construction agreement with a vendor for land reclamation in July 2024, and completed
substantive work as of December 2024 with cost of approximately RMB8.2 million incurred.
We expect that we may incur an estimated total cost of approximately RMB8.3 million in
relation to the land reclamation. The results of land reclamation will be subject to the review
by relevant governmental authorities before their approval of land return. We cannot assure you
that we will not incur additional costs in relation to the land reclamation pending review by the
relevant governmental authorities, or that we will not become subject to disputes, claims or
legal proceedings in relation to the foregoing land return matter.
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The results of any potential disputes, litigation, investigations and legal proceedings are
inherently unpredictable and expensive. Any claims against us, whether meritorious or not,
could be time consuming, costly, and harmful to our reputation, and could require significant
amounts of management time and corporate resources. If any of these legal proceedings were
to be determined adversely to us, or we were to enter into a settlement arrangement, we could
be exposed to monetary damages or be forced to change the way in which we operate our
business, which could have a material and adverse effect on our business, financial condition,
and operating results.
We have limited insurance coverage, and any claims beyond our insurance coverage may
result in us incurring substantial costs and a diversion of resources.
We maintain insurance policies that are required under PRC laws and regulations as well
as insurance based on our assessment of our operational needs and industry practice. We also
maintain clinical trial insurance in all the regions where we conduct clinical trials. In line with
industry practice in the PRC, we have elected not to maintain certain types of insurances, such
as business interruption insurance or key-man insurance. Our insurance coverage may be
insufficient to cover any claim for product liability, damage to our fixed assets or employee
injuries. Any liability or damage to, or caused by, our facilities or our personnel beyond our
insurance coverage may result in us incurring substantial costs and a diversion of resources.
Our internal information technology systems, or those of our CROs or third-party vendors,
may fail or suffer security breaches or other unauthorized or improper access, which could
result in a significant disruption of our product development programs, give rise to
significant liability, subject us to costly and protracted litigation, compromise sensitive
information related to our business, cause significant reputational harm and impact our
ability to operate our business effectively.
We are increasingly dependent upon information technology systems, infrastructure, and
data to operate our business. In the ordinary course of business, we collect, store, and transmit
confidential information (including but not limited to intellectual property, proprietary
business information, and sensitive and personal information). It is critical that we do so in a
secure manner to maintain the confidentiality and integrity of such information.
Despite our efforts, our internal information technology systems and those of our current
and any future third-party vendors and collaborators may be vulnerable to a variety of
disruptive elements, including data breaches, cyber-attacks by malicious third parties
(including the deployment of computer viruses, harmful malware, ransomware, denial-of-
service attacks, social engineering, and other means to affect service reliability and threaten the
confidentiality, integrity, and availability of information), unauthorized access, natural
disasters, fires, terrorism, war, telecommunication and electrical failures and breaches or
disruptions caused by persons with access to systems inside our organization. In particular, the
risk of a security breach or disruption, particularly through cyber-attacks or cyber intrusion,
including by computer hackers and cyber terrorists, has generally increased as the number,
intensity, and sophistication of attempted attacks and intrusions from around the world have
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increased. We may not be able to anticipate all types of security threats, and we may not be able
to implement preventive measures effective against all such security threats. Because the
techniques used by cyber criminals change frequently, may not be recognized until launched,
and can originate from a wide variety of sources, including outside groups such as external
service providers, organized crime affiliates or terrorist organizations, we and our partners may
be unable to anticipate these techniques or implement adequate preventative measures.
While we have not experienced any significant system failure, accident or security breach
to date, if such an event were to occur and cause interruptions in our operations or a loss of,
or damage to, our data or applications, or those of our third-party vendors, it could result in
a disruption of our development programs and our business operations, whether due to a loss
of our trade secrets or other confidential, personal or proprietary information, significant
delays or setbacks in our research, or other similar disruptions. For example, the loss of clinical
trial data from our ongoing or future clinical trials could result in delays in our regulatory
approval efforts and significantly increase our costs to recover or reproduce the data. To the
extent that any disruption or security breach were to result in a loss of, or damage to, our data
or applications, or inappropriate disclosure of confidential, personal or proprietary
information, we could incur significant liability, our competitive position could be harmed, our
reputation could be damaged, and the further development and commercialization of our drug
candidates could be delayed.
Unauthorized disclosure of sensitive or confidential data, including personal information,
whether through a breach of computer systems, systems failure, employee negligence, fraud or
misappropriation, or otherwise, or unauthorized access to or through our information systems
and networks, whether by our employees or third parties, could result in negative publicity,
significant liabilities (including under applicable data privacy and security laws and
regulations), damage to our reputation and/or enforcement actions against us. For example,
competent authorities could compel us to comply with China’s cybersecurity and data
protection laws and analogous laws of other jurisdictions, subject us to mandatory corrective
action, and otherwise subject us to liability under laws and regulations that protect the privacy
and security of personal information. The costs related to significant security breaches or
disruptions could be material. If the information technology systems of our third-party vendors
and other collaborators become subject to disruptions or security breaches, we may be exposed
to material liability and have insufficient recourse against such third parties and we may have
to expend significant resources to mitigate the impact of such an event, and to develop and
implement protections to prevent future events of this nature from occurring. The financial
exposure from the events referenced above could either not be insured against or not be fully
covered through any insurance that we may maintain, and there can be no assurance that the
limitations of liability in any of our contracts would be enforceable or adequate or would
otherwise protect us from liabilities or damages as a result of the events referenced above. Any
of the foregoing could adversely affect our business, financial condition, results of operations
and prospects.
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A severe or prolonged downturn in the global economy could materially and adversely affect
our business and financial condition.
The global macroeconomic environment is facing numerous challenges. In particular,
there is significant uncertainty about the future relationship between the United States and its
major trading partners, including China, with respect to trade policies, treaties, government
regulations and tariffs. The growth rate of the Chinese economy has generally been slowing
since 2012 and the trend may continue. There is considerable uncertainty over the long-term
effects of the expansionary monetary and fiscal policies adopted by the central banks and
financial authorities of some of the world’s leading economies, including the United States and
China. There have been concerns over unrest and terrorist threats in the Middle East, Europe
and Africa, which have resulted in market volatility. There have also been concerns on the
relationship between China and other countries, including the United States and the
surrounding Asian countries, which may potentially have economic effects. For example, on
February 21, 2025, U.S. President Donald J. Trump issued a memo entitled the “America First
Investment Policy” (the “America First Memo”), outlining the ongoing review and
consideration of potential new or expanded restrictions on U.S. outbound investment in the
PRC in sectors such as semiconductors, artificial intelligence, quantum, biotechnology,
hypersonics, aerospace, advanced manufacturing, directed energy, and other areas implicated
by the PRC’s national military-civil fusion strategy. The America First Memo also
contemplates potential restrictions on investments in publicly traded securities by pension
funds, university endowments and other limited partner investors. Such political tensions and
policy changes would have an adverse effect on global economic conditions, the stability of
global financial markets, and international trade policies. Economic conditions in China are
sensitive to global economic conditions, as well as changes in domestic economic and political
policies and the expected or perceived overall economic growth rate in China. Any severe or
prolonged slowdown in the global or Chinese economy may materially and adversely affect our
business, results of operations and financial condition.
Business disruptions could seriously harm our future revenue and financial condition and
increase our costs and expenses.
Our operations, and those of our vendors and suppliers, could be subject to earthquakes,
power shortages, telecommunications failures, water shortages, floods, hurricanes, typhoons,
fires, extreme weather conditions, medical epidemics and other natural or man-made disasters
or business interruptions or other factors that may be beyond our control, for which we are
predominantly self-insured. The occurrence of any of these business disruptions could
seriously harm our operations and financial condition and increase our costs and expenses. We
currently rely on Ascendis Pharma to produce and supply all of our drug candidates for clinical
development and commercial supply in the short term and our ability to obtain clinical and
commercial supplies of our drug candidates could be disrupted if the operations of Ascendis
Pharma are affected by any business interruption.
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We may be subject, directly or indirectly, to applicable anti-kickback, false-claim, physician
payment transparency, or fraud and abuse laws, or similar healthcare and security laws and
regulations in China and other jurisdictions, which could expose us to criminal sanctions,
civil penalties, contractual damages, reputational harm, and diminished profits and future
earnings.
Healthcare providers, physicians and others play a primary role in the recommendation
and prescription of any products for which we obtain regulatory approval. If we obtain NMPA
or other regulatory authority approval for any of our drug candidates and begin
commercializing those products in China, our operations may be subject to various PRC fraud
and abuse laws, including, without limitation, the Anti-Unfair Competition Law of the PRC
(), the Criminal Law of the PRC ( ʕശɛ͏΍ձ਷Α
). These laws may impact, among other things, our proposed commercialization programs.
In addition, we may be subject to patient privacy laws and requirements, including, without
limitation, the Civil Code of the PRC (Պ) and the Good Clinical
Practice for Drug Trials (ᑗґ༊᜕ሯඎ၍ଣ஝ᇍ).
Violations of fraud and abuse laws may be punishable by criminal and/or civil sanctions,
including penalties, fines and/or exclusion or suspension from governmental healthcare
programs and debarment from contracting with the PRC government.
Law enforcement authorities are increasingly focused on enforcing these laws, and it is
possible that some of our practices may be challenged under these laws. Efforts to ensure that
our business arrangements with third parties will comply with applicable healthcare laws and
regulations will involve substantial costs. It is possible that Governmental Authorities will
conclude that our business practices may not comply with current or future statutes, regulations
or case law involving applicable fraud and abuse or other healthcare laws and regulations. If
any such actions are instituted against us, and we are not successful in defending ourselves or
asserting our rights, those actions could have a significant impact on our business, including
the imposition of civil, criminal and administrative penalties, damages, disgorgement,
monetary fines, possible exclusion from participation in governmental healthcare programs,
contractual damages, reputational harm, diminished profits and future earnings, and
curtailment of our operations, any of which could adversely affect our ability to operate our
business and our results of operations.
If any of the physicians or other providers or entities with whom we expect to do business
are found to be not in compliance with applicable laws, they may be subject to criminal, civil
or administrative sanctions, including exclusions from government-funded healthcare
programs, which may also adversely affect our business.
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We may not be able to renew our current leases or locate desirable alternatives for our offices
and laboratories.
We lease properties for our offices and may in the future lease land and properties for our
expanded manufacturing sites. We may not be able to obtain, extend or renew such leases on
commercially reasonable terms, or if at all, as we will have to compete with other businesses
for premises at desired locations. Rental payments may significantly increase as a result of high
demand for the leased properties. Moreover, we may not be able to extend or renew such leases
upon expiration of their terms and may therefore be forced to relocate the affected operations.
This could disrupt our operations and result in significant relocation expenses. We may not be
able to locate desirable alternative sites for our offices and manufacturing sites. The occurrence
of such events could materially and adversely affect our business, financial condition, results
of operations and prospects.
The PRC’s economic, political and social conditions, as well as governmental policies, could
affect the business environment and financial markets in China, our ability to operate our
business, our liquidity and our access to capital.
Substantially all of our operations are conducted in China. Accordingly, our business,
results of operations, financial condition and prospects may be influenced to a significant
degree by economic, political, legal and social conditions in China and our PRC subsidiaries
are governed by PRC laws and regulations. China’s economy has experienced significant
growth in the past few decades. The PRC government has implemented various measures to
encourage economic development and guide the allocation of resources. Some of these
measures may benefit the overall PRC economy, but may have a negative effect on us. Such
changes in the PRC economy and relevant markets in the future may materially and adversely
affect our business, financial position and results of operations. In addition, the PRC legal
system is a civil law system based on written statutes and governmental polices are constantly
evolving. We may face challenges in complying with such evolving regulatory landscapes,
which could impact our business operations.
Government control of currency conversion of and regulations on loans to, and direct
investment in, PRC entities by offshore holding companies may delay or prevent us from
making loans or additional contributions to our PRC subsidiary, which could limit our
ability to utilize the proceeds from the offering effectively and affect our ability to fund and
expand our business.
Our PRC subsidiaries’ ability to obtain foreign exchange is subject to foreign exchange
regulations. In particular, if we finance our PRC subsidiaries by means of foreign debt from us
or other foreign lenders, the amount is not allowed to exceed the statutory limits and such loans
must be registered with the local counterpart of SAFE. If we finance our PRC subsidiaries by
means of additional capital contributions, the amount of these capital contributions must first
be approved by or filed with the relevant government approval authority. Please refer to the
paragraphs headed “Regulatory Environment – Other Significant Regulations of the PRC
Affecting Our Business – Foreign Exchange Control” in this document for more information.
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In the light of such requirements imposed by PRC regulations on loans to, and direct
investment in, PRC entities by offshore holding companies, we cannot assure you that we will
be able to complete the necessary government registrations or obtain the necessary government
approvals on timely basis, if at all, with respect to future loans or capital contributions by us
to our PRC subsidiaries. If we fail to complete such registrations or obtain such approval, our
ability to capitalize or otherwise fund our PRC operations may be negatively affected, which
could materially and adversely affect our liquidity and our ability to fund and expand our
business.
We face foreign exchange risks. Fluctuations in exchange rates could have a material and
adverse effect on our results of operations and financial performance.
Change in exchange rates may materially and adversely affect our results of operations
and financial performance. The value of the Renminbi against the US dollar and other
currencies is affected by a number of factors, such as regulatory updates and developments in
the PRC’s and international political and economic conditions. As we have transactional
currency exposures, arising from purchases by operating units in currencies other than the
units’ functional currencies, and held most of our cash and cash equivalents in US dollars, any
appreciation of the Renminbi against the U.S. dollar may result in the decrease in the value of
our foreign currency denominated assets. In addition, We currently do not have a foreign
currency hedging policy to reduce our foreign currency exposure. We recorded net foreign
exchange gains of RMB79.8 million and RMB4.7 million in 2022 and 2023, respectively and
net foreign exchange losses of RMB0.1 million in the nine months ended September 30, 2024.
Please refer to Note 6 of the Accountants’ Report in Appendix I to this document for detailed
foreign exchange exposure during the Track Record Period. We cannot assure you that we will
be able to minimize or reduce our foreign currency risk exposure relating to our foreign
currency denominated assets.
As a holding company, we rely on dividends and other distributions on equity paid by our
PRC subsidiaries to fund any cash and financing requirements we may have.
We are a holding company incorporated in the Cayman Islands, and we operate our
business through our operating subsidiaries in China. We rely on the distribution to us by our
Chinese subsidiaries for funding, including to pay dividends to our Shareholders and to service
any debt we may incur. Under PRC laws and regulations, our PRC subsidiaries may pay
dividends only out of its accumulated profits as determined in accordance with PRC accounting
standards and regulations. In addition, our PRC subsidiaries are required to set aside at least
10% of its accumulated after-tax profits each year, if any, to fund a certain statutory reserve
fund, until the aggregate amount of such fund reaches 50% of its registered capital. Such
reserve funds cannot be distributed to us as dividends. At its discretion, our PRC subsidiaries
may allocate a portion of its after-tax profits based on PRC accounting standards to a
discretionary reserve fund.
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We may be deemed as a PRC tax resident under the Enterprise Income Tax Law and be
subject to PRC taxation on our worldwide income.
Under the Enterprise Income Tax Law of the People’s Republic of China, or the EIT Law,
enterprises established under the laws of jurisdictions other than China may be considered PRC
tax residents provided that their “de facto management body” are located within China.
Supplementary rules of the EIT Law interpret “de facto management body” as a body that
exercises substantial management or control over the business, personnel, finance and
properties of an enterprise. Through a circular promulgated in April 2009, the PRC State
Administration of Taxation further clarified the criteria for determining whether an enterprise
has a “de facto management body” within China. As most of our management is currently based
in China and many may remain in China in the future, we and our non-PRC subsidiaries may
be treated as PRC tax residents. If we or our non-PRC subsidiaries were treated as PRC tax
residents, we or such non-PRC subsidiaries may be subject to enterprise income tax at a rate
of 25% on our worldwide taxable income and to PRC enterprise income tax reporting
obligations. Any income sourced by us from outside China would be subject to PRC enterprise
income tax at a rate of 25%. While the EIT Law provides that dividend income between
“qualified resident enterprises” is exempt from PRC enterprise income tax, it is not clear
whether our Company and our non-PRC subsidiaries would be eligible for such exemption
were we considered to be PRC tax residents. In addition, if we are treated as PRC tax residents
under Chinese laws, capital gains realized from sales of our Shares and dividends we pay to
non-PRC resident Shareholders may be treated as income sourced within China. Accordingly,
dividends we pay to non-PRC resident Shareholders and transfers of Shares by these
Shareholders may be subject to PRC income tax. The tax on this income of non-PRC resident
enterprise Shareholders would be imposed at a rate of 10% (and may be imposed at a rate of
20% in the case of non-PRC resident individual Shareholders). In the case of dividends, this
tax would be withheld by us at source. Any PRC tax liability may ultimately be reduced under
an applicable tax treaty. However, it is uncertain whether our shareholders, if deemed PRC tax
residents, would be able to obtain the benefits of any income tax treaties or agreements
between their country or jurisdiction of tax residence and the PRC. If we are required to
withhold PRC income tax on dividends payable to you, or if you are required to pay PRC
income tax on the transfer of our Shares, the value of your investment in our Shares may be
materially and adversely affected.
Transfers of equity interests in a PRC resident enterprise by a non-resident enterprise are
regulated by the Chinese tax authorities.
On February 3, 2015, the PRC State Administration of Taxation issued the Announcement
on Several Issues concerning Enterprise Income Tax for Indirect Transfer of Assets by Non-
Resident Enterprises (ʮѓ) (“Circular
7”). This regulation repealed certain provisions in the Notice on Strengthening the
Administration of Enterprise Income Tax on Non-Resident Enterprises’ Equity Transfer
Income (ٝCircular 698”) and
certain rules clarifying Circular 698. Circular 698 was issued by the PRC State Administration
of Taxation on December 10, 2009.
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Circular 7 provides comprehensive guidelines relating to, and heightened the Chinese tax
authorities’ scrutiny on, indirect transfers by a non-resident enterprise of assets (including
equity interests) of a PRC resident enterprise (“PRC Taxable Assets”). For example, when a
non-resident enterprise transfers equity interests in an overseas holding company that directly
or indirectly holds certain PRC Taxable Assets and if the transfer is believed by the Chinese
tax authorities to have no reasonable commercial purpose other than to evade enterprise income
tax, Circular 7 allows the Chinese tax authorities to reclassify this indirect transfer of PRC
Taxable Assets into a direct transfer and impose on the non-resident enterprise a 10% rate of
PRC enterprise income tax. Circular 7 exempts this tax, for examples, (i) where a non-resident
enterprise derives income from an indirect transfer of PRC Taxable Assets by acquiring and
selling shares of a listed overseas holding company in the public market, and (ii) where a
non-resident enterprise transfers PRC Taxable Assets that it directly holds and an applicable tax
treaty or arrangement exempts this transfer from PRC enterprise income tax. It remains unclear
whether any exemptions under Circular 7 will be applicable to transfers of our Shares by our
Shareholders. If the Chinese tax authorities impose PRC enterprise income taxes on these
activities, the value of your investment in our Shares may be adversely affected.
It may be difficult to effect service of process upon us or our management or to enforce any
judgments obtained from foreign courts.
We are a company incorporated in the Cayman Islands with substantially all of our assets
located within China. Some of our Directors and senior management reside in China and
substantially all of their assets are within China. Judgments of courts of another jurisdiction
may be reciprocally recognized or enforced if the jurisdiction has a treaty on that with China.
Currently, China does not have treaties providing for the reciprocal enforcement of judgments
of courts with Japan, the United States, the United Kingdom or most other western countries.
On July 14, 2006, Hong Kong and China entered into the Arrangement on Reciprocal
Recognition and Enforcement of Judgments in Civil and Commercial Matters by the Courts of
the Mainland and of the Hong Kong Special Administrative Region Pursuant to Choice of
Court Agreements Between Parties Concerned (ʝႩ̙ձ
τર) (the “2006 Arrangement”), pursuant to
which reciprocal recognition and enforcement of the judgment may be possible between these
two jurisdictions provided that the judgment is rendered by a final court of these two
jurisdictions and the parties has a expressly written choice of court. On January 18, 2019, the
Arrangement on Reciprocal Recognition and Enforcement of Judgments in Civil and
Commercial Matters by the Courts of the Mainland and of the Hong Kong Special
Administrative Region (ٙ
τર) (the “2019 Arrangement”) was signed between the Supreme People’s Court of China
and Hong Kong and effective on January 29, 2024, and the 2006 Arrangement has been
superseded. The 2019 Arrangement establishes a bilateral legal mechanism with greater clarity
and certainty for reciprocal recognition and enforcement of judgments between Hong Kong and
the PRC in civil and commercial matters under both Hong Kong and PRC law. The 2019
Arrangement sets forth, among others, the scope, specific types of matters to be covered or
excluded, jurisdictional grounds for the purpose of recognition and enforcement as well as
grounds for refusal of recognition and enforcement. However, the 2006 Arrangement will
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remain applicable to a “choice of court agreement in writing” as defined in the 2006
Arrangement which is entered into before the 2019 Arrangement taking effect. As the 2019
Arrangement went effective relatively recently and its implementation and interpretation are
still evolving, further, China does not have treaties providing for the reciprocal enforcement of
judgments of courts with Japan, the United States, the United Kingdom or most other western
countries, as a result, investors may have limited resources when they seek recognition and
enforcement of judgments obtained from non-PRC courts against us or our Directors or officers
who live in the PRC.
Failure by our Shareholders or beneficial owners who are PRC residents to make required
applications and filings pursuant to regulations relating to offshore investment activities by
PRC residents may prevent us from distributing dividends and could expose us and our
Shareholders who are PRC residents to liability under Chinese laws.
In 2014, the SAFE promulgated the Circular of the State Administration of Foreign
Exchange on Relevant Issues concerning Foreign Exchange Control on Domestic Residents’
Offshore Investment and Financing and Roundtrip Investment through Special Purpose
V ehicles (೻ҳ༟̮ි၍ଣ
) (“SAFE Circular 37”). SAFE Circular 37 requires PRC residents to register
with local branches of SAFE in connection with their direct establishment or indirect control
of an offshore entity, for the purpose of overseas investment and financing, with such PRC
residents’ legally owned assets or equity interests in domestic enterprises or offshore assets or
interests, referred to in SAFE Circular 37 as a “special purpose vehicle.” The term “control”
under SAFE Circular 37 is broadly defined as the operation rights, beneficiary rights or
decision-making rights acquired by the PRC residents in the offshore special purpose vehicles
or PRC companies by such means as acquisition, trust, proxy, voting rights, repurchase,
convertible bonds or other arrangements. SAFE Circular 37 further requires amendment to the
registration in the event of any changes with respect to the basic information of or any
significant changes with respect to the special purpose vehicle. If the shareholders of the
offshore holding company who are PRC residents do not complete their registration with the
local SAFE branches, the PRC subsidiaries may be prohibited from distributing their profits
and proceeds from any reduction in capital, share transfer or liquidation to the offshore
company, and the offshore company may be restricted in its ability to contribute additional
capital to its PRC subsidiaries. Moreover, failure to comply with SAFE registration and
amendment requirements described above could result in liability under PRC law for evasion
of applicable foreign exchange restrictions. We are committed to complying with and to
ensuring that our Shareholders who are subject to these regulations will comply with the
relevant SAFE rules and regulations.
We are not aware of any PRC residents who hold direct or indirect interests in our
Company and are required to make the filings and registrations pursuant to SAFE Circular 37
and other related rules. However, we may not be informed of the identities of all the PRC
residents holding direct or indirect interests in our Company, and we cannot provide any
assurance that these PRC residents will comply with our request to make or obtain any
applicable registrations or comply with other requirements under SAFE Circular 37 or other
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related rules. In addition, we cannot assure you that all of our Shareholders or beneficial
owners who are PRC residents have complied with, and will in the future make or obtain any
applicable registrations or approvals required by, SAFE regulations. The failure or inability of
our PRC resident Shareholders to comply with the registration procedures set forth in these
regulations may subject us to fines and legal sanctions, restrict our cross-border investment
activities, and limit the ability of our PRC subsidiaries to distribute dividends and the proceeds
from any reduction in capital, share transfer or liquidation to us, and we may also be prohibited
from injecting additional capital into the PRC subsidiaries. Moreover, failure to comply with
the various foreign exchange registration requirements described above could result in liability
under PRC law for circumventing applicable foreign exchange restrictions. As a result, our
business operation and our ability to distribute profits to you could be materially and adversely
affected.
Any failure to comply with PRC regulations regarding the registration requirements may
subject us to fines and other legal or administrative sanctions, which could adversely affect
our business, financial condition and results of operations.
In February 2012, the SAFE promulgated the Notices of the State Administration of
Foreign Exchange on Issues concerning the Foreign Exchange Administration of Domestic
Individuals’ Participation in Equity Incentive Plans of Overseas Listed Companies
().
In accordance with these rules and other relevant rules and regulations, PRC citizens or
non-PRC citizens residing in China for a continuous period of not less than one year, who
participate in any stock incentive plan of an overseas publicly listed company, subject to a few
exceptions, are required to register with SAFE through a domestic qualified agent, which could
be a PRC subsidiary of such overseas listed company, and complete certain procedures. We and
our employees who are PRC citizens or who reside in China for a continuous period of not less
than one year and who participate in our stock incentive plan will be subject to such regulation.
Any failure of our PRC individual beneficial owners and holders of share options or shares to
comply with the SAFE registration requirements may subject them to fines and legal sanctions
and may limit the ability of our PRC subsidiaries to distribute dividends to us.
Certain of our leasehold interests in leased properties have not been registered with the
relevant PRC Governmental Authorities as required by relevant PRC laws. The failure to
register leasehold interests may expose us to potential fines.
Pursuant to the Measures for Administration of Lease of Commodity Properties (ۜ
), which was promulgated by the Ministry of Housing and Urban-Rural
Development of the PRC on December 1, 2010 and became effective on February 1, 2011, both
lessors and lessees are required to file the lease agreements for registration and obtain property
leasing filing certificates for their leases. As of the Latest Practicable Date, we did not register
all seven of our lease agreements as tenant, and such leased properties were primarily used as
office space and registered address. We may be required by relevant Governmental Authorities
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to file these lease agreements for registration within a time limit, and may be subject to a fine
for non-registration exceeding such time limit, which may range from RMB1,000 to
RMB10,000 for each non-registered lease if we fail to complete the registration within the
prescribed timeframe.
RISKS RELATED TO THE GLOBAL OFFERING
No public market currently exists for our Shares; an active trading market for our Shares
may not develop and the market price and trading volume of our Shares may decline or
become volatile, which could lead to substantial losses to investors.
No public market currently exists for our Shares. The initial Offer Price for our Shares
to the public will be the result of negotiations between our Company, Joint Global Coordinators
and Overall Coordinators (for themselves and on behalf of the Underwriters), and the Offer
Price may differ significantly from the market price of the Shares following the Global
Offering. We have applied to the Stock Exchange for the listing of, and permission to deal in,
the Shares in issue, the Shares to be issued pursuant to the Global Offering (including any
Shares that may be issued pursuant to the Offer Size Adjustment Option and the Over-allotment
Option) and the Shares which may be issued pursuant to the Post-IPO Share Award Scheme.
A listing on the Stock Exchange, however, does not guarantee that an active and liquid trading
market for our Shares will develop, or if it does develop, that it will be sustained following the
Global Offering, or that the market price or trading volume of the Shares will not decline
following the Global Offering.
Our Controlling Shareholders have significant influence over our Company and their
interests may not be aligned with the interest of our other Shareholders.
Immediately upon the completion of the Global Offering without taking into account any
Shares which may be issued pursuant to the exercise of the Offer Size Adjustment Option or
the Over-allotment Option, our Controlling Shareholders will collectively control
approximately 68.72% voting power at general meetings of our Company. Our Controlling
Shareholders will, through their voting power at the Shareholders’ meetings and their delegates
on the Board, have significant influence over our business and affairs, including decisions in
respect of mergers or other business combinations, acquisition or disposition of assets,
issuance of additional Shares or other equity securities, timing and amount of dividend
payments, and our management. Our Controlling Shareholders may not act in the best interests
of our minority Shareholders. For example, we obtain exclusive licenses from Ascendis Pharma
for the development, manufacture and commercialization of our drug candidates and procure
the clinical supplies of our endocrine drug candidates from Ascendis Pharma. While we do not
foresee any reason that Ascendis Pharma may determine our exclusive licenses with it to cease
manufacturing our drug candidates, there is no guarantee that our Controlling Shareholders’
interests will always be aligned with us or our other Shareholders. In addition, without the
consent of our Controlling Shareholders, we could be prevented from entering into transactions
that could be beneficial to us. This concentration of ownership may also discourage, delay or
prevent a change in control of our Company, which could deprive our Shareholders of an
opportunity to receive a premium for the Shares as part of a sale of our Company and may
significantly reduce the price of our Shares.
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Future sales or perceived sales of our Shares in the public market by major Shareholders
following the Global Offering could materially and adversely affect the price of our Shares.
Prior to the Global Offering, there has not been a public market for our Shares. Future
sales or perceived sales by our existing Shareholders of our Shares after the Global Offering
could result in a significant decrease in the prevailing market price of our Shares. Only a
limited number of the Shares currently outstanding will be available for sale or issuance
immediately after the Global Offering due to contractual and regulatory restrictions on disposal
and new issuance. Nevertheless, after these restrictions lapse or if they are waived, future sales
of significant amounts of our Shares in the public market or the perception that these sales may
occur could significantly decrease the prevailing market price of our Shares and our ability to
raise equity capital in the future.
Y ou will incur immediate and significant dilution and may experience further dilution if we
issue additional Shares or other equity securities in the future.
The Offer Price of the Offer Shares is higher than the net tangible asset value per Share
immediately prior to the Global Offering. Therefore, purchasers of the Offer Shares in the
Global Offering will experience an immediate dilution in pro forma net tangible asset value.
In order to expand our business, we may consider offering and issuing additional Shares in the
future. Purchasers of the Offer Shares may experience dilution in the net tangible asset value
per share of their Shares if we issue additional Shares in the future at a price which is lower
than the net tangible asset value per Share at that time. Furthermore, we may issue Shares
pursuant to the Share Schemes, which would further dilute Shareholders’ interests in our
Company.
Because we do not expect to pay dividends in the near future after the Global Offering, you
must rely on price appreciation of our Shares for a return on your investment.
We currently intend to retain most, if not all, of our available funds and any future
earnings after the Global Offering to fund the development and commercialization of our
pipeline drug candidates near future. As a result, we do not expect to pay any cash dividends
in the near future and you should not rely on an investment in our Shares as a source for any
future dividend income.
The Shareholders in general meeting may declare dividends, but no dividends shall
exceed the amount recommended by the Board. Our Board has discretion as to whether to
distribute interim dividends. Even if our Board decides to declare and pay dividends, the
timing, amount and form of future dividends, if any, will depend on our future results of
operations and cash flow, our capital requirements and surplus, the amount of distributions (if
any) received by us from our subsidiaries, our financial condition, contractual restrictions and
other factors deemed relevant by our Board. Accordingly, the return on your investment in our
Shares will likely depend entirely upon any future price appreciation of our Shares. There is
no guarantee that our Shares will appreciate in value after the Global Offering or even maintain
the price at which you purchased the Shares. Y ou may not realize a return on your investment
in our Shares and you may even lose your entire investment in our Shares.
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We cannot make fundamental changes to our business without the consent of the Stock
Exchange.
Under Rule 18A.10 of the Listing Rules, without the prior consent of the Stock Exchange,
we will not be able to effect any acquisition, disposal or other transaction or arrangement or
any series of acquisitions, disposals or other transactions or arrangements, which would result
in a fundamental change in our principal business activities as set forth in this document. As
a result, we may be unable to take advantage of certain strategic transactions that we might
otherwise choose to pursue in the absence of Rule 18A.10. Were any of our competitors that
are not listed on the Stock Exchange to take advantage of such opportunities in our place, we
may be placed at a competitive disadvantage, which could have a material adverse effect on our
business, financial condition and results of operations.
We are a Cayman Islands exempted company and, because judicial precedent regarding the
rights of shareholders is more limited under the laws of the Cayman Islands than other
jurisdictions, you may have difficulties in protecting your shareholder rights.
Our corporate affairs are governed by our Memorandum and Articles and by the Cayman
Companies Act and common law of the Cayman Islands. The rights of shareholders to take
legal action against our Directors and us, actions by minority shareholders and the fiduciary
responsibilities of our Directors to us under Cayman Islands law are to a large extent governed
by the common law of the Cayman Islands. The common law of the Cayman Islands is derived
in part from comparatively limited judicial precedent in the Cayman Islands as well as from
English common law, which has persuasive, but not binding, authority on a court in the
Cayman Islands. The laws of the Cayman Islands relating to the protection of the interests of
minority shareholders differ in some respects from those established under statutes and judicial
precedent in existence in the jurisdictions where minority shareholders may be located. See
“Appendix III – Summary of the Constitution of Our Company and Cayman Islands Company
Law” for more details.
As a result of all of the above, minority shareholders may enjoy different remedies when
compared to the laws of the jurisdiction in which such shareholders are located in.
Y ou should read the entire document carefully, and we strongly caution you not to place any
reliance on any information contained in press articles or other media regarding us or the
Global Offering.
Subsequent to the date of this document but prior to the completion of the Global
Offering, there may be press and media coverage regarding us and the Global Offering, which
may contain, among other things, certain financial information, projections, valuations and
other forward-looking information about us and the Global Offering. We have not authorized
the disclosure of any such information in the press or media and do not accept responsibility
for the accuracy or completeness of such press articles or other media coverage. We make no
representation as to the appropriateness, accuracy, completeness or reliability of any of the
projections, valuations or other forward-looking information about us. To the extent such
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statements are inconsistent with, or conflict with, the information contained in this document,
we disclaim responsibility for them. Accordingly, prospective investors are cautioned to make
their investment decisions on the basis of the information contained in this document only and
should not rely on any other information.
Y ou should rely solely upon the information contained in this document, the Global
Offering and any formal announcements made by us in making your investment decision
regarding our Shares. We do not accept any responsibility for the accuracy or completeness of
any information reported by the press or other media, nor the fairness or appropriateness of any
forecasts, views or opinions expressed by the press or other media regarding our Shares, the
Global Offering or us. We make no representation as to the appropriateness, accuracy,
completeness or reliability of any such data or publication. Accordingly, prospective investors
should not rely on any such information, reports or publications in making their decisions as
to whether to invest in the Global Offering. By applying to purchase our Shares in the Global
Offering, you will be deemed to have agreed that you will not rely on any information other
than that contained in this document and the Global Offering.
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In preparation for the Global Offering, we have sought the following waivers from strict
compliance with the relevant provisions of the Listing Rules and an exemption from
compliance with the Companies (Winding Up and Miscellaneous Provisions) Ordinance:
MANAGEMENT PRESENCE IN HONG KONG
Pursuant to Rule 8.12 of the Listing Rules, an issuer must have sufficient management
presence in Hong Kong. This normally means that at least two of its executive directors must
be ordinarily resident in Hong Kong. We do not have sufficient management presence in Hong
Kong for the purposes of satisfying the requirements under Rule 8.12 of the Listing Rules.
The Group’s management, business operations and assets are primarily based outside
Hong Kong. The headquarters and its business operations are based, managed and conducted
in the PRC. Currently, the executive Director of the Company, who is our Chief Executive
Officer, ordinarily resides in the PRC. All of the senior management team principally reside in
the PRC and they manage the Group’s business operations from the PRC. As our executive
Director and the senior management team play very important roles in the Company’s business
operations, the Company considers that it is in the best interests of the Company for the
executive Director and the majority of senior management team to be based in the places where
the Group has significant operations. As such, the Company does not, and will not for the
foreseeable future, have a sufficient management presence in Hong Kong for the purpose of
satisfying the requirements under Rule 8.12 of the Listing Rules. Accordingly, we have applied
for, and pursuant to paragraph 10 of Chapter 3.10 of the Guide, the Stock Exchange has
granted, a waiver from strict compliance with the requirements under Rule 8.12 of the Listing
Rules. We will ensure that there is an effective channel of communication between us and the
Stock Exchange by way of the following arrangements:
(a) pursuant to Rule 3.05 of the Listing Rules, we have appointed and will continue to
maintain two authorized representatives, namely Mr. LU An-bang, our executive
Director and Chief Executive Officer, and Ms. Chan Sze Ting, our company
secretary, to be the principal communication channel at all times between the Stock
Exchange and the Company. Each of our authorized representatives will be readily
contactable by the Stock Exchange based on information provided to the Stock
Exchange for the contact details of the authorized representatives. Both of our
authorized representatives are authorized to communicate on our behalf with the
Stock Exchange and shall be authorized to accept service of process and notices on
behalf of our Company in Hong Kong under the Companies Ordinance;
(b) pursuant to Rule 3.20 of the Listing Rules, each Director has provided his/her
contact information (including their mobile phone numbers, office phone numbers
and e-mail addresses (if available)) to the Stock Exchange and to the authorized
representatives. This will ensure that the Stock Exchange and the authorized
representatives should have means for contacting all Directors promptly at all times
as and when required;
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(c) we will ensure that all Directors who are not ordinarily resident in Hong Kong have
valid travel documents to visit Hong Kong and will be able to come to Hong Kong
to meet with the Stock Exchange within a reasonable period of time when required;
(d) we have retained the services of the Compliance Advisor, in accordance with Rule
3A.19 of the Listing Rules. The Compliance Advisor, among other things, will serve
as an additional channel of communication in addition to the authorized
representatives of our Company. The Compliance Advisor will provide our
Company with professional advice on ongoing compliance with the Listing Rules
and will be available to respond to enquiries from the Stock Exchange. We will
ensure that the Compliance Advisor has prompt access to our Company’s authorized
representatives and Directors who will provide to the Compliance Advisor such
information and assistance as the Compliance Advisor may need or may reasonably
request in connection with the performance of the Compliance Advisor’s duties. The
Compliance Advisor will also provide advice in compliance with Rule 3A.23 of the
Listing Rules; and
(e) meetings between the Stock Exchange and the Directors could be arranged through
the authorized representatives or the Compliance Advisor, or directly with the
Directors within a reasonable time frame. Our Company will inform the Stock
Exchange as soon as practicable in respect of any change in the authorized
representatives and/or the Compliance Advisor in accordance with the Listing Rules.
W AIVER FROM STRICT COMPLIANCE WITH RULE 4.04(1) OF THE LISTING
RULES AND EXEMPTIONS FROM STRICT COMPLIANCE WITH SECTION 342(1)
IN RELATION TO PARAGRAPH 27 OF PART I AND PARAGRAPH 31 OF PART II OF
THE THIRD SCHEDULE TO THE COMPANIES (WINDING UP AND
MISCELLANEOUS PROVISIONS) ORDINANCE FOR THE FULL FINANCIAL YEAR
ENDED DECEMBER 31, 2024
Rule 4.04(1) of the Listing Rules requires that the consolidated results of our Group in
respect of each of the three financial years immediately preceding the issue of the prospectus
be included in the Accountants’ Report to this prospectus.
Rule 13.49(1) of the Listing Rules requires issuers to publish preliminary financial results
not later than three months after the end of each financial year.
Pursuant to section 342(1) of the Companies (Winding Up and Miscellaneous Provisions)
Ordinance, the prospectus shall include matters specified in Part I of the Third Schedule to the
Companies (Winding Up and Miscellaneous Provisions) Ordinance and sets out the reports
specified in Part II of the Third Schedule to the Companies (Winding Up and Miscellaneous
Provisions) Ordinance.
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Pursuant to paragraph 27 of Part I of the Third Schedule to the Companies (Winding Up
and Miscellaneous Provisions) Ordinance, our Company is required to include in the
prospectus a statement as to the gross trading income or sales turnover (as the case may be)
of our Company during each of the three financial years immediately preceding the issue of the
prospectus, including an explanation of the method used for the computation of such income
or turnover and a reasonable breakdown between the more important trading activities.
Pursuant to paragraph 31 of Part II of the Third Schedule to the Companies (Winding Up
and Miscellaneous Provisions) Ordinance, our Company is required to include in the
prospectus a report prepared by our Company’s auditor with respect to profits and losses and
assets and liabilities of our Company in respect of each of the three financial years immediately
preceding the issue of the prospectus.
Pursuant to section 342A of the Companies (Winding Up and Miscellaneous Provisions)
Ordinance, the SFC may issue, subject to such conditions (if any) as the SFC thinks fit, a
certificate of exemption from compliance with the relevant requirements under the Companies
(Winding Up and Miscellaneous Provisions) Ordinance if, having regard to the circumstances,
the SFC considers that the exemption will not prejudice the interest of the investing public and
compliance with any or all of such requirements would be irrelevant or unduly burdensome, or
is otherwise unnecessary or inappropriate.
The Company is a biotech company as defined under Chapter 18A of the Listing Rules
and is seeking a listing under Chapter 18A of the Listing Rules. Rule 18A.03(3) of the Listing
Rules requires that a biotech company must have been in operation in its current line of
business for at least two financial years prior to listing under substantially the same
management. Rule 18A.06 of the Listing Rules further requires that a biotech company must
comply with Rule 4.04 of the Listing Rules, modified so that references to “three financial
years” or “three years” in Rule 4.04 of the Listing Rules shall instead reference to “two
financial years” or “two years”, as the case may be.
Pursuant to paragraph 19 of Chapter 1.1A of the Guide for New Listing Applicants
published by the Stock Exchange, in view of the shortened deadline for releasing preliminary
results announcements and to enable potential investors to have adequate and timely
information, where an applicant issues its listing document in the third month after the latest
year end, the Stock Exchange has provided the conditions for granting a waiver from strict
compliance with Rule 4.04(1) of the Listing Rules as follows:
(i) the prospectus will be issued on or before March 13, 2025 and the applicant must
list on the Stock Exchange within three months after the latest year end;
(ii) the applicant must obtain a certificate of exemption from the SFC on compliance
with the requirements under the Companies (Winding Up and Miscellaneous
Provisions) Ordinance;
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(iii) the financial information for the latest financial year and a commentary on the
results for that financial year must be included in the listing document. The financial
information to be included in the listing document must (a) follow the same content
requirements as for a preliminary results announcement under Rule 13.49 of the
Listing Rules; and (b) be agreed with the reporting accountants following their
review under Practice Note 730 “Guidance for Auditors Regarding Preliminary
Announcements of Annual Results” issued by the Hong Kong Institute of Certified
Public Accountants; and
(iv) the Company will not be in breach of its constitutional documents or laws and
regulations of the Cayman Islands or other regulatory requirements regarding its
obligation to publish preliminary results announcements.
The financial year of the Company ends on December 31. The prospectus contains the
consolidated results of the Group for the two years ended December 31, 2022 and 2023 and the
nine months ended September 30, 2024, but does not include the consolidated results of the
Group in respect of the full year immediately preceding the proposed date of issue of the
prospectus, being the full year ended December 31, 2024, as required under Rule 4.04(1) of the
Listing Rules, paragraph 27 of Part I and paragraph 31 of Part II of the Third Schedule to the
Companies (Winding Up and Miscellaneous Provisions) Ordinance.
The waiver and exemption applied for would not prejudice the interests of the investing
public. The strict compliance with the requirements under Rule 4.04(1) of the Listing Rules,
paragraph 27 of Part I and paragraph 31 of Part II of the Third Schedule to the Companies
(Winding Up and Miscellaneous Provisions) Ordinance would be unduly burdensome for the
following reasons:
(a) there would not be sufficient time for the Company and the reporting accountants to
finalize the audited consolidated financial statements of the Group for the year
ended December 31, 2024 for inclusion in the prospectus. It would be unduly
burdensome for the Company and the reporting accountants to undertake the
considerable amount of work required to prepare, update and finalize the
Accountants’ Report to cover such additional period within a short period of time.
Our Directors consider that the benefits of such work to the existing and prospective
shareholders of our Company may not justify the additional work and expenses
involved and the delay of the Listing timetable;
(b) the Company has included in this prospectus (i) the Accountants’ Report covering
the two years ended December 31, 2023 and the nine months ended September 30,
2024, (ii) the unaudited preliminary financial information of the Group for the year
ended December 31, 2024 and a commentary on the results for the year, which has
been agreed with the Group’s reporting accountants, following their review under
Practice Note 730 “Guidance for Auditors Regarding Preliminary Announcements of
Annual Results” issued by the Hong Kong Institute of Certified Public Accountants,
and such disclosure is no less than the content requirements for a preliminary results
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announcement under Rule 13.49 of the Listing Rules, and (iii) the information
regarding the recent development of our Group subsequent to the Track Record
Period and up to the Latest Practicable Date;
(c) our Directors and the Joint Sponsors confirm, after performing sufficient due
diligence work up to the date of this prospectus, that there has been no material
adverse change to the financial and trading positions or prospects of the Group since
October 1, 2024 (immediately following the date of the latest audited statement of
financial position in the Accountants’ Report set out in Appendix I to this document)
up to the date of this prospectus, and there has been no event since October 1, 2024
which would materially affect the information contained in the Accountants’ Report
as set out in Appendix I to this Prospectus, the financial information section, the
unaudited preliminary financial information of the Group for the year ended
December 31, 2024, as set out in Appendix IIB to this Prospectus and information
regarding the Company’s recent development subsequent to the Track Record Period
and up to the date of this prospectus;
(d) the Company and the Joint Sponsors are of the view that the Accountants’ Report
covering the two years ended December 31, 2022, December 31, 2023 and the nine
months ended September 30, 2024, as set out in Appendix I to the prospectus, the
unaudited pro forma financial information as set out in Appendix IIA to the
prospectus, the unaudited preliminary financial information for the year ended
December 31, 2024 as set out in Appendix IIB to the prospectus, together with other
disclosure in this prospectus, has already provided the potential investors with
adequate and reasonably up-to-date information in the circumstances to form a view
on the track record of the Company; and the Directors confirm that all information
which is necessary for the investing public to make an informed assessment of the
business, assets and liabilities, financial position, management and prospects has
been included in this prospectus. Therefore, the waiver and the exemption would not
prejudice the interests of the investing public;
(e) the Company will not be in breach of its Articles of Association or laws and
regulations of the Cayman Islands or other regulatory requirements as a result of not
publishing its preliminary results announcement for the year ended December 31,
2024 in accordance with Rule 13.49(1) of the Listing Rules. Pursuant to the Note to
Rule 13.49(1) of the Listing Rules, our Company will publish an announcement after
Listing and no later than March 31, 2025 stating that the relevant financial
information has been included in this prospectus; and
(f) the Company will comply with the requirements under Rule 13.46 of the Listing
Rules in respect of the publication of its annual report. The Company currently
expects to issue its annual report for the financial year ended December 31, 2024 on
or before April 30, 2025. In this regard, the Directors consider that the Shareholders,
the investing public, as well as potential investors of the Company, will be kept
informed of the financial results of the Group for the financial year ended
December 31, 2024.
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In light of the above, we have applied for, and the Stock Exchange has granted us, a
waiver from strict compliance with the requirements under Rule 4.04(1) of the Listing Rules
relating to the inclusion in the Accountants’ Report of the consolidated results of our Group in
respect of the full financial year ended December 31, 2024, on the conditions that: (i) this
prospectus will be issued on or before March 13, 2025 and the Listing Date shall not be later
than three months after the latest financial year end of our Company (i.e. on or before March
31, 2025); (ii) we have obtained from the SFC a certificate of exemption from strict compliance
with the requirements under section 342(1) in relation to paragraphs 27 and 31 of the Third
Schedule to the Companies (Winding Up and Miscellaneous Provisions) Ordinance; (iii) the
preliminary unaudited financial information for the year ended December 31, 2024 and a
commentary on the results for the year shall be included in the prospectus; (iv) and the
Company will not be in breach of its constitutional documents or laws and regulations of the
Cayman Islands or other regulatory requirements regarding its obligation to publish
preliminary results announcements.
We have also applied for, and the SFC has granted us, a certificate of exemption under
section 342A of the Companies (Winding Up and Miscellaneous Provisions) Ordinance from
strict compliance with the requirements under paragraph 27 of Part I and paragraph 31 of Part
II of the Third Schedule to the Companies (Winding Up and Miscellaneous Provisions)
Ordinance on the conditions that: (i) the particulars of this exemption are set out in the
prospectus; (ii) the prospectus will be issued on or before March 13, 2025 and the Company’s
Shares will be listed on or before March 31, 2025 (i.e. three months after the latest financial
year-end).
CONTINUING CONNECTED TRANSACTIONS
We have entered into and will continue to engage in certain transactions which would
potentially constitute continuing connected transactions for our Company under the Listing
Rules following completion of the Global Offering. We have applied to the Stock Exchange for,
and the Stock Exchange has granted us, waivers from strict compliance with certain
requirements set out in Chapter 14A of the Listing Rules for certain continuing connected
transactions. For further details of such potential non-exempt continuing connected
transactions and the waivers, please see “Connected Transactions – Continuing Connected
Transactions.”
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W AIVER FROM STRICT COMPLIANCE WITH RULE 9.09(B), RULE 10.04 OF AND
CONSENT UNDER PARAGRAPH 5(2) OF APPENDIX F1 TO THE LISTING RULES IN
RESPECT OF SUBSCRIPTIONS OF OFFER SHARES BY EXISTING SHAREHOLDER
AS A CORNERSTONE INVESTOR
Rule 9.09(b) of the Listing Rules provides, inter alia, that there must be no dealing in the
securities for which listing is sought by any core connected person of the issuer, in the case of
a new applicant, from four clear business days before the expected hearing date until listing is
granted.
Rule 10.04 of the Listing Rules provides that a person who is an existing shareholder of
the applicant may only subscribe for or purchase securities for which listing is sought if no
securities will be offered to them on a preferential basis and no preferential treatment will be
given to them in the allocation of securities, and the minimum prescribed percentage of public
shareholders required by Rule 8.08(1) of the Listing Rule is achieved.
Paragraph 5(2) of Appendix F1 to the Listing Rules provides, inter alia, that no
allocations will be permitted to directors or existing shareholders of the applicant or their close
associates, whether in their own names or through nominees, unless the conditions set out in
Rules 10.03 and 10.04 are fulfilled, without the prior written consent of the Exchange.
Chapter 2.3 of the Guide for New Listing Applicants provides that existing shareholders
are allowed to participate in the initial public offering of a Biotech Company (as defined under
Chapter 18A of the Listing Rules) provided that the applicant complies with Rules 8.08(1) and
18A.07 of the Listing Rules in relation to shares held by the public. Further, pursuant to
paragraph 18 of Chapter 2.3 of the Guide for New Listing Applicants, an existing shareholder
holding less than 10% of shares in a Biotech Company must subscribe for shares in the Listing
as either a cornerstone investor or as a placee and an existing shareholder holding 10% or more
of shares in a Biotech Company may subscribe for shares in the Proposed Listing as a
cornerstone investor. As further described in the section headed “Cornerstone Investors” in this
prospectus, Vivo Capital is an existing Shareholder, and has entered into Cornerstone
Investment Agreement (as defined therein) with the Company.
We have applied for a waiver from strict compliance with the requirements under Rule
10.04 and Rule 9.09(b) of, and a consent under paragraph 5(2) of Appendix F1 to, the Listing
Rules, to allow Vivo Capital to participate as a Cornerstone Investor (as defined below) in the
Global Offering to subscribe for the Shares to be issued by the Company under the
International Offering (the “ Proposed Cornerstone Investments ”).
The Stock Exchange has agreed to grant the requested waiver and consent subject to the
conditions that:
(a) we will comply with the public float requirements of Rules 8.08(1) and 18A.07 of
the Listing Rules;
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(b) the Shares to be subscribed by and allocated to Vivo Capital under the Global
Offering will be at the same Offer Price and substantially the same terms as the other
Cornerstone Investors in the Global Offering (including being subject to a six-month
lock up arrangement following Listing);
(c) our Company and the Joint Sponsors confirm that no preferential treatment has been,
nor will be, given to Vivo Capital by virtue of its relationships with the Company
in any allocation in the Global Offering, other than the preferential treatment of
assured entitlement under the cornerstone investments which follow the principles
set out in paragraph 13 of Chapter 4.15 of the Guide for New Listing Applicants that,
save as disclosed in “Cornerstone Investors,” the cornerstone investment agreement
of Vivo Capital does not contain any material terms which are more favorable to
them than those in the other cornerstone investment agreements. In addition, Vivo
Capital has no influence over the allocation process of the Global Offering; and
(d) details of the subscription of the Offer Shares by Vivo Capital as a Cornerstone
Investor under the Global Offering are disclosed in this prospectus, and details of
the allocation will be disclosed in the allotment results announcement of our
Company.
For further information about the Proposed Cornerstone Investments, please refer to the
section headed “Cornerstone Investors” in this prospectus.
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DIRECTORS’ RESPONSIBILITY STATEMENT
This document, for which our Directors collectively and individually accept full
responsibility, includes particulars given in compliance with the Companies (Winding Up and
Miscellaneous Provisions) Ordinance, the Securities and Futures (Stock Market Listing) Rules
(Chapter 571V of the Laws of Hong Kong) and the Listing Rules for the purpose of giving
information with regard to us. Our Directors, having made all reasonable enquiries, confirm
that to the best of their knowledge and belief the information contained in this document is
accurate and complete in all material respects and not misleading or deceptive, and there are
no other matters the omission of which would make any statement herein or this document
misleading.
THE HONG KONG PUBLIC OFFERING AND THIS DOCUMENT
This document is published solely in connection with the Hong Kong Public Offering,
which forms part of the Global Offering. For applicants under the Hong Kong Public Offering,
this document set out the terms and conditions of the Hong Kong Public Offering.
The Hong Kong Offer Shares are offered solely on the basis of the information contained
and representations made in this document and on the terms and subject to the conditions set
out herein and therein. No person is authorized to give any information in connection with the
Global Offering or to make any representation not contained in this document, and any
information or representation not contained herein must not be relied upon as having been
authorized by our Company, the Joint Global Coordinators, the Overall Coordinators, the Joint
Bookrunners, the Joint Lead Managers, the Joint Sponsors and any of the Underwriters, any of
their respective directors, agents, employees or advisers or any other party involved in the
Global Offering.
The Listing is sponsored by the Joint Sponsors and the Global Offering is managed by the
Joint Global Coordinators. The Hong Kong Public Offering is fully underwritten by the Hong
Kong Underwriters under the terms and conditions of the Hong Kong Underwriting Agreement
and is subject to us and the Joint Global Coordinators and the Overall Coordinators (on behalf
of the Hong Kong Underwriters) agreeing on the Offer Price. The International Offering is
expected to be fully underwritten by the International Underwriters subject to the terms and
conditions of the International Underwriting Agreement, which is expected to be entered into
on or around the Price Determination Date. If, for any reason, the Offer Price is not agreed
among us and the Joint Global Coordinators and the Overall Coordinators (on behalf of the
Hong Kong Underwriters), by 12:00 noon on Wednesday, March 19, 2025, the Global Offering
will not proceed and will lapse. For full information about the Underwriters and the
underwriting arrangement, see “Underwriting.”
INFORMATION ABOUT THIS PROSPECTUS AND THE GLOBAL OFFERING
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Neither the delivery of this document nor any offering, sale or delivery made in
connection with the Shares should, under any circumstances, constitute a representation that
there has been no change or development reasonably likely to involve a change in our affairs
since the date of this document or imply that the information contained in this document is
correct as of any date subsequent to the date of this document.
PROCEDURES FOR APPLICATION FOR HONG KONG OFFER SHARES
The procedures for applying for Hong Kong Offer Shares are set forth in the section
headed in “How to Apply for Hong Kong Offer Shares.”
STRUCTURE AND CONDITIONS OF THE GLOBAL OFFERING
Details of the structure of the Global Offering, including its conditions, are set forth in
the section headed “Structure of the Global Offering.”
OVER-ALLOTMENT OPTION AND STABILIZATION
Details of the arrangements relating to the Over-allotment Option and stabilization are set
forth in the section headed “Structure of the Global Offering.”
RESTRICTIONS ON OFFERS AND SALES OF SHARES
Each person acquiring the Hong Kong Offer Shares under the Hong Kong Public Offering
will be required to, or be deemed by his acquisition of Offer Shares to, confirm that he is aware
of the restrictions on offers of the Offer Shares described in this document. No action has been
taken to permit a public offering of the Offer Shares or the general distribution of this
document in any jurisdiction other than in Hong Kong. Accordingly, this document may not be
used for the purposes of, and does not constitute, an offer or invitation in any jurisdiction or
in any circumstances in which such an offer or invitation is not authorized or to any person to
whom it is unlawful to make such an offer or invitation. The distribution of this document and
the offering of the Offer Shares in other jurisdictions are subject to restrictions and may not
be made except as permitted under the applicable securities laws of such jurisdictions and
pursuant to registration with or authorization by the relevant securities regulatory authorities
or an exemption therefrom.
APPLICATION FOR LISTING OF THE SHARES ON THE STOCK EXCHANGE
We have applied to the Listing Committee for the listing of, and permission to deal in, the
Shares in issue, the Shares to be issued pursuant to the Global Offering (including any Shares
that may be issued pursuant to the Offer Size Adjustment Option and the Over-allotment
Option) and the Shares which may be issued pursuant to the Post-IPO Share Award Scheme.
INFORMATION ABOUT THIS PROSPECTUS AND THE GLOBAL OFFERING
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CSRC FILING
On March 25, 2024, the CSRC has issued a notification on our Company’ completion of
the PRC filing procedures for the listing of our Shares on the Stock Exchange and the Global
Offering. In issuing this notification, the CSRC does not accept responsibility for the financial
soundness of our Company, or for the accuracy of any of the statements made or opinions
expressed in this prospectus.
COMMENCEMENT OF DEALINGS IN THE SHARES
Dealings in the Shares on the Stock Exchange are expected to commence on Friday,
March 21, 2025. The Shares will be traded in board lots of 100 Shares each. The stock code
of the Shares will be 2561.
SHARES WILL BE ELIGIBLE FOR ADMISSION INTO CCASS
If the Stock Exchange grants the listing of, and permission to deal in, the Shares in issue,
the Shares to be issued pursuant to the Global Offering (including any Shares that may be
issued pursuant to the Offer Size Adjustment Option and the Over-allotment Option) and the
Shares which may be issued pursuant to the Post-IPO Share Award Scheme and we comply with
the stock admission requirements of HKSCC, the Shares will be accepted as eligible securities
by HKSCC for deposit, clearance and settlement in CCASS with effect from the Listing Date
or any other date as determined by HKSCC. Settlement of transactions between participants of
the Stock Exchange is required to take place in CCASS on the second settlement day after any
trading day. All activities under CCASS are subject to the General Rules of HKSCC and the
HKSCC Operational Procedures in effect from time to time. All necessary arrangements have
been made to enable the Shares to be admitted into CCASS. Investors should seek the advice
of their stockbroker or other professional advisers for details of the settlement arrangement as
such arrangements may affect their rights and interests.
PROFESSIONAL TAX ADVICE RECOMMENDED
Y ou should consult your professional advisers if you are in any doubt as to the taxation
implications of subscribing for, purchasing, holding or disposing of, or dealing in, the Shares
or exercising any rights attaching to the Shares. We emphasize that none of our Company, the
Joint Global Coordinators, the Overall Coordinators, the Joint Bookrunners, the Joint Lead
Managers, the Joint Sponsors, the Underwriters, any of our or their respective directors,
officers or representatives or any other person involved in the Global Offering accepts
responsibility for any tax effects or liabilities resulting from your subscription, purchase,
holding or disposing of, or dealing in, the Shares or your exercise of any rights attaching to the
Shares.
INFORMATION ABOUT THIS PROSPECTUS AND THE GLOBAL OFFERING
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REGISTER OF MEMBERS AND STAMP DUTY
Our principal register of members will be maintained by our Principal Share Registrar,
International Corporation Services Ltd., in the Cayman Islands, and our Hong Kong branch
register of members will be maintained by the Hong Kong Share Registrar, Computershare
Hong Kong Investor Services Limited in Hong Kong. All Offer Shares issued pursuant to
applications made in the Hong Kong Public Offering and the International Offering will be
registered on the Hong Kong register of members of our Company in Hong Kong. Dealings in
the Shares registered in our Hong Kong register of members will be subject to Hong Kong
stamp duty. For further details of Hong Kong stamp duty, please seek professional tax advice.
EXCHANGE RATE CONVERSION
Solely for your convenience, this document contains translations of certain Renminbi
amounts into Hong Kong dollars, of Renminbi amounts into U.S. dollars, and of Hong Kong
dollars into U.S. dollars at specified rates and of Renminbi amounts into Euro. Unless we
indicate otherwise, the translation of Renminbi into Hong Kong dollars, of Renminbi into U.S.
dollars, and of Hong Kong dollars into U.S. dollars, and vice versa, in this document was made
at the following rates:
RMB0.9224 to HK$1.00
RMB7.1739 to US$1.00
HK$7.7771 to US$1.00
No representation is made that any amounts in Renminbi, Hong Kong dollars or U.S.
dollars can be or could have been at the relevant dates converted at the above rates or any other
rates or at all.
ROUNDING
Certain amounts and percentage figures included in this document have been subject to
rounding adjustments. Accordingly, figures shown as totals in certain tables may not be an
arithmetic aggregation of the figures preceding them.
INFORMATION ABOUT THIS PROSPECTUS AND THE GLOBAL OFFERING
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LANGUAGE
If there is any inconsistency between this document and its Chinese translation, this
document shall prevail, provided that if there is any inconsistency between the Chinese names
of the entities or enterprises established in China mentioned in this document and their English
translations, the Chinese names shall prevail. The English translations of the Chinese names of
such PRC entities or enterprises are provided for identification purposes only.
OTHER
Unless otherwise specified, all references to any shareholdings in our Company following
the completion of the Global Offering assume that the Offer Size Adjustment Option and the
Over-allotment Option are not exercised.
INFORMATION ABOUT THIS PROSPECTUS AND THE GLOBAL OFFERING
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DIRECTORS
Name Address Nationality
Executive Director
Mr. LU An-Bang ( ጅτԞ) Unit 705, Building No. 4
No. 6 Chaowai Dajie
Chaoyang District
Beijing, PRC
Taiwan, PRC
Non-Executive Directors
Mr. Michael Wolff JENSEN Slotsvej 62
DK-2920 Charlottenlund
Denmark
Denmark
Mr. Jan Møller MIKKELSEN 543 Seale Avenue
Palo Alto
CA 94301
U.S.A.
Denmark
Mr. FU Shan ( ˹ʆ) Flat D, 9/F, BLK 7, The Visionary
1 Ying Hong Street
Tung Chung, NT
Hong Kong
PRC
Mr. Michael J. CHANG 1 Jiak Kim Street #21-07
Singapore 169423
USA
Mr. CAO Yibo ( ૎ʏ௹) Suite no. 2-3619
Harbourview Horizon Suites
12 HungLok Road
Hung Hom Bay
Kowloon
Hong Kong
PRC
DIRECTORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
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Name Address Nationality
Independent Non-Executive Directors
Dr. Y AO Zhengbin (Bing) 2002 Stanwich Drive, Berwyn,
PA19312, U.S.A.
USA
Mr. CHAN Peng Kuan
(ඓ)
Flat B8, 14/F, Block B
Viking Garden
40-42 Hing Fat Street
Tin Hau
Hong Kong
Hong Kong,
PRC
Ms. NI Hong (ࠀࡎHouse 17B, Shouson Peak
9-19 Shouson Hill Road
Deep Water Bay
Hong Kong
Hong Kong,
PRC
See “Directors and Senior Management” for further details.
PARTIES INVOLVED IN THE GLOBAL OFFERING
Joint Sponsors Morgan Stanley Asia Limited
46/F, International Commerce Centre
1 Austin Road West
Kowloon
Hong Kong
Jefferies Hong Kong Limited
26/F, Two International Finance Centre
8 Finance Street Central
Hong Kong
Overall Coordinators and
Sponsor-Overall Coordinators
Morgan Stanley Asia Limited
46/F, International Commerce Centre
1 Austin Road West
Kowloon
Hong Kong
Jefferies Hong Kong Limited
26/F, Two International Finance Centre
8 Finance Street Central
Hong Kong
DIRECTORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
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Joint Global Coordinators,
Joint Bookrunners and
Joint Lead Managers
Morgan Stanley Asia Limited
46/F, International Commerce Centre
1 Austin Road West
Kowloon
Hong Kong
Jefferies Hong Kong Limited
26/F, Two International Finance Centre
8 Finance Street Central
Hong Kong
Joint Bookrunners and
Joint Lead Managers
(in alphabetical order)
CLSA Limited
18/F, One Pacific Place
88 Queensway
Hong Kong
Futu Securities International
(Hong Kong) Limited
34/F, United Centre
No. 95 Queensway
Admiralty
Hong Kong
Guoyuan Securities Brokerage
(Hong Kong) Limited
17/F, Exchange Square 3
8 Connaught Place
Central
Hong Kong
Soochow Securities
International Brokerage Limited
17F, Three Pacific Place
1 Queen’s Road East
Wan Chai
Hong Kong
Joint Lead Managers
(in alphabetical order)
Patrons Securities Limited
Unit 3214, 32/F
Cosco Tower
183 Queen’s Road Central
Sheung Wan
Hong Kong
Ruibang Securities Limited
9/F, Sang Woo Building
227-228 Gloucester Road
Wan Chai
Hong Kong
DIRECTORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
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Capital Markets Intermediaries Morgan Stanley Asia Limited
46/F, International Commerce Centre
1 Austin Road West
Kowloon
Hong Kong
Jefferies Hong Kong Limited
26/F, Two International Finance Centre
8 Finance Street Central
Hong Kong
CLSA Limited
18/F, One Pacific Place
88 Queensway
Hong Kong
Futu Securities International
(Hong Kong) Limited
34/F, United Centre
No. 95 Queensway
Admiralty
Hong Kong
Guoyuan Securities Brokerage
(Hong Kong) Limited
17/F, Exchange Square 3
8 Connaught Place
Central Hong Kong
Soochow Securities
International Brokerage Limited
17F, Three Pacific Place
1 Queen’s Road East
Wan Chai
Hong Kong
Patrons Securities Limited
Unit 3214, 32/F Cosco Tower
183 Queen’s Road Central
Sheung Wan
Hong Kong
Ruibang Securities Limited
9/F, Sang Woo Building
227-228 Gloucester Road
Wan Chai
Hong Kong
DIRECTORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
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Legal Advisers to our Company As to Hong Kong and U.S. laws:
Cooley HK
35/F, Two Exchange Square
8 Connaught Place
Central
Hong Kong
As to PRC law:
JunHe LLP
26/F HKRI Centre One, HKRI Taikoo Hui
288 Shimen Road (No. 1)
Shanghai 200041
PRC
As to Cayman Islands law:
Travers Thorp Alberga
Harbour Place, 2nd Floor
PO Box 472
103 South Church Street
Grand Cayman, KY1-1106
Cayman Islands
Legal advisers to the Joint Sponsors
and the Underwriters
As to Hong Kong and U.S. laws:
Davis Polk & Wardwell
10/F, The Hong Kong Club Building
3A Chater Road
Hong Kong
As to PRC law:
Commerce & Finance Law Offices
13F, China World Office 2
No. 1 Jianguomenwai Avenue
Beijing
PRC
DIRECTORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
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Auditor and reporting accountant Ernst & Y oung
Certified Public Accountants
Registered Public Interest Entity Auditor
27/F, One Taikoo Place
979 King’s Road
Quarry Bay
Hong Kong
Industry consultant Frost & Sullivan International Limited
3006, Two Exchange Square
8 Connaught Place
Central
Hong Kong
Receiving banks Industrial and Commercial
Bank of China (Asia) Limited
33/F, ICBC Tower
3 Garden Road
Central
Hong Kong
Bank of China (Hong Kong) Limited
7/F, Bank of China Centre
Olympian City 1
11 Hoi Fai Road
West Kowloon
Hong Kong
CMB Wing Lung Bank Limited
14/F, CMB Wing Lung Bank Building
45 Des V oeux Road
Central
Hong Kong
Compliance adviser Somerley Capital Limited
20/F China Building
29 Queen’s Road
Central
Hong Kong
DIRECTORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
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--- page 157 ---
Headquarter Suite 3-108, Floor 3, Building B,
Hengtai Lixiang Chuangxin
Tower, 69 Jiuzhang Road,
Suzhou
China
Principal Place of Business in Hong Kong 5/F, Manulife Place
348 Kwun Tong Road
Kowloon
Hong Kong
Registered office in the Cayman Islands International Corporation Services Ltd.
Harbour Place
2nd Floor
PO Box 472
103 South Church Street
Grand Cayman
KY1-1106
Cayman Islands
Company website www.visenpharma.com
(the information contained on this website
does not form part of this document)
Company Secretary Ms. Chan Sze Ting ( ௓་ణ) (FCG, HKFCG)
Room 1919,
19/F Lee Garden One
33 Hysan Avenue
Causeway Bay
Hong Kong
Authorized representatives Mr. LU An-bang ( ጅτԞ)
Unit 705, Building No. 4
No. 6 Chaowai Dajie
Chaoyang District
Beijing, PRC
Ms. Chan Sze Ting ( ௓་ణ) (FCG, HKFCG)
Room 1919,
19/F Lee Garden One
33 Hysan Avenue
Causeway Bay
Hong Kong
Audit committee Mr. CHAN Peng Kuan (ඓ) (chairman)
Mr. FU Shan ( ˹ʆ)
Dr. Y AO Zhengbin (Bing)
CORPORATE INFORMATION
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Remuneration committee Ms. NI Hong (ࠀࡎchairwoman)
Mr. CHAN Peng Kuan (ඓ)
Mr. LU An-Bang ( ጅτԞ)
Nomination committee Mr. Michael Wolff JENSEN (chairman)
Dr. Y AO Zhengbin (Bing)
Ms. NI Hong (ࠀࡎ)
Principal share registrar and
transfer office
International Corporation Services Ltd.
Harbour Place
2nd Floor
PO Box 472
103 South Church Street
Grand Cayman
KY1-1106
Cayman Islands
Hong Kong Share Registrar Computershare Hong Kong
Investor Services Limited
Shops 1712-1716
17th Floor Hopewell Centre
183 Queen’s Road East
Wanchai
Hong Kong
Principal bank Bank of China
3rd Floor, Tower I, Kerry Centre
1515 Nanjing West Road, Jing’an District
Shanghai, China
CORPORATE INFORMATION
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Certain information and statistics set out in this section have been extracted from
various official government publications, market data providers and a report
commissioned by us and prepared by an independent third party, Frost & Sullivan. The
information from official government sources has not been independently verified by us,
the Joint Global Coordinators, Joint Sponsors, Overall Coordinators, Joint Bookrunners,
Joint Lead Managers, any of the Underwriters, any of their respective directors and
advisers, or any other persons or parties involved in the Global Offering, and no
representation is given as to its accuracy.
ENDOCRINE SYSTEM AND DISEASES
The endocrine system is a network of glands that produces and releases hormones to
regulate body processes, such as energy control, reproduction, immunity, behavior, growth and
development. This system includes major glands throughout the body, as illustrated below.
Hormones produced by these glands enter the bloodstream and are regulated by feedback loops
of the endocrine system. In particular, the balance of hormones in the bloodstream is controlled
by negative feedback loops.
Endocrine System Includes Major Glands Throughout the Body
Source: Frost & Sullivan Analysis, Created with BioRender .com
INDUSTRY OVERVIEW
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Endocrine diseases and disorders result from the improper function of the endocrine
system, which can be categorized into hormone overproduction, hormone underproduction,
altered tissue responses to hormones and others. Most endocrine disorders progress steadily
and complications of untreated or poorly controlled endocrine disorders can be serious, even
life-threatening. Contrary to acute cancer or acute infectious diseases that develop rapidly and
require urgent or short-term care, endocrine diseases are typically chronic and often require
life-long treatment, especially in patients with complex pathology and high associated
morbidity. Patients with chronic disease may experience complicated treatment plans requiring
significant compliance efforts that may result in reduced productivity, inability to work and
low quality of life – this has been termed as the “treatment burden,” which often leads to poor
adherence and ultimately suboptimal treatment outcomes.
Endocrinology is a large therapeutic area spanning over 170 types of diseases, among
which 79, or nearly half, still lack disease-specific drugs, indicating significant unmet medical
needs. The total prevalence of the top five non-diabetic endocrine diseases in China, namely
hypothyroidism, polycystic ovary syndrome, constitutional tall stature, hyperaldosteronism
and hyperthyroidism, was 191.8 million in 2021.
Endocrine diseases may occur at all ages, affecting newborn to elderly patients. They can
be generally categorized into pediatric endocrine diseases and adult endocrine diseases, with
each group having its unique characteristics. Children are not just small adults when it comes
to endocrine disorders and treatment. As growing individuals, pediatric patients have special
needs related to growth and development, and hence they often face a limited treatment
window and an urgent need for timely treatment. Hormone problems affecting growth or
development can have significant effects on a child’s lifelong physical and emotional
well-being. In addition, treatment compliance for children often requires parent/caregiver
supervision and discomfort and pain in treatment may affect children’s compliance, calling for
more convenient treatment options with simplified drug regimens and better experience. Adult
endocrine disorders often require lifelong treatment, creating significant needs for treatment
options with reduced burden and favorable long-term safety profiles. Endocrine diseases are
often associated with significant disease and socioeconomic burden including time lost from
work, burden on caregivers, etc. For example, patients with GHD report more sick leave from
work and increased healthcare utilization, including more frequent hospital days and provider
visits, and the need for assistance with daily activities, according to Frost & Sullivan.
OVERVIEW OF NON-DIABETIC ENDOCRINE DRUG MARKET
The Non-Diabetic Endocrine Drug Market in China
The non-diabetic endocrine drug market in China witnessed strong growth from RMB11.7
billion in 2018 to RMB20.8 billion in 2023, at a CAGR of 12.2%. It is estimated to further
grow to RMB74.2 billion by 2030, at a CAGR of 19.9% from 2023 to 2030, according to Frost
& Sullivan.
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The non-diabetic endocrine drug market in China has been growing and is expected to
continue to grow at a significantly higher rate than the global non-diabetic endocrine drug
market. According to Frost & Sullivan, the market size of the latter decreased at a CAGR of
6.6% from 2018 to 2023 due to the negative impact of COVID-19 pandemic on sales volume,
the lack of relevant new drug or formulation approvals from 2016-2019, and increased
competition from generic drugs. The global non-diabetic endocrine drug market is expected to
grow at a CAGR of 12.9% from 2023 to 2030, according to Frost & Sullivan.
The chart below illustrates the historical and forecast size of the non-diabetic endocrine
drug market in China:
Non-Diabetic Endocrine Drug Market in China, 2018-2030E
14.6Non-diabetic endocrine drug 11.7 14.1 18.8 19.6 20.8 32.5 42.0 50.9 59.7 67.1 74.225.7
Billion RMB
20192018 2020 2021 2022 2023 2025E 2026E 2027E 2028E 2029E 2030E2024E
CAGR Non-diabetic endocrine drug
2018-2023
2023-2030E
12.2%
19.9%
11.7 14.6 14.1 18.8 19.6 20.8 25.7
32.5
42.0
50.9
59.7
67.1
74.2
Source: Expert Interview, Annual Report, Frost & Sullivan Analysis
The endocrine drug market in China, including the non-diabetic endocrine drug market,
is well-positioned for strong potential market growth. The endocrine drugs innovation in
China, especially for non-diabetic endocrine drugs, is still catching up to the developed
markets, creating significant opportunities for introducing innovative drug candidates with
proven clinical benefits from developed markets. From 2016 to 2023, the FDA approved 14
novel endocrine drugs, including six for diabetes and eight for non-diabetic endocrine diseases
such as PGHD. 17 novel endocrine drugs were approved by the NMPA during the same period,
including 16 for diabetes and one for non-diabetic endocrine diseases.
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FDA and NMPA Approved Novel Endocrine Drugs,* 2016-2023
NMPAFDA
Anti-diabetic drugsNon-diabetic endocrine drugs
6
16
1
8
* Novel drugs refer to new molecular entities and new therapeutic biological products
Source: FDA, NMP A, Frost & Sullivan Analysis
Significant Unmet Medical Needs in China
 Large patient pool. Endocrine diseases affect a large patient population in China.
The total prevalence of the top five non-diabetic endocrine diseases in China,
namely hypothyroidism, polycystic ovary syndrome, constitutional tall stature,
hyperaldosteronism and hyperthyroidism, was 191.8 million in 2021.
 Lack of awareness and underdiagnosis. In contrast to acute diseases, most endocrine
diseases may progress over years with few or no signs at their early stage of
development. Common symptoms of endocrine diseases may be too mild to raise
patient awareness. Therefore, many patients undergo a long journey before being
diagnosed and receiving the appropriate treatment. Additionally, diagnosis of
endocrine diseases with more complex conditions often requires highly specialized
clinicians, restricting the diagnosis rate of patients with limited access to
appropriate healthcare resources.
 Lack of guidelines on diagnosis and treatment . Even for patients who are aware of
their developed symptoms and incentivized to visit physicians, they may not be able
to receive precise diagnosis and timely treatment due to the lack of guidelines on
diagnosis and treatment that identifies and describes diagnosis criteria, treatment
goals, courses of intervention, etc. The development of guidelines requires
considerable resources. In addition, guidelines need to be continuously updated in
light of change in evidence or new interventions. However, the less common a
disease, the harder it is to gather resources to develop or update guidelines.
 Lack of effective treatments. There is generally a lack of effective treatments for
non-diabetic endocrine diseases. In China, partially due to a lag in drug innovation
as compared to regions such as the United States and Europe, effective treatments
of non-diabetic endocrine diseases are also in great need. For example, there is
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currently no effective disease-modifying therapy for ACH approved in China. While
some local hGH drugs have expanded their indications to include short stature
caused by ACH, such as Jintropin (marketed by GeneScience Pharmaceuticals) and
Ansomone (marketed by Anhui Anke), none of these drugs are disease-modifying.
 Lack of convenient options for long-term treatment. As many endocrine diseases
require treatment over the course of many years, the currently available daily
long-term treatment places heavy burden on patients. A high treatment burden is
associated with poor adherence. According to the World Health Organization, for
example, the average adherence rate to long-term therapy for chronic illnesses in
developed countries is only around 50%. Low adherence to long-term treatment
often results in suboptimal treatment outcomes, creating a significant need for
convenient treatment options, which are currently less available in China as
compared to regions such as the United States, Europe and Japan. For example, there
are innovative endocrine drugs that recently have been approved in the United States
but are not yet approved in China, including lonapegsomatropin, which is the first
once-weekly LAGH replacement therapy approved by both the FDA and the EMA
for treating PGHD.
Favorable Healthcare Policies
Recent government policies in the healthcare sector have made China an attractive market
for the development of innovative endocrine drugs.
 Policies to prioritize the prevention and treatment of endocrine diseases. As part of
a national effort to fight chronic disease, the State Council issued in 2017 the
Medium-to-Long Term Plan of China for the Prevention and Treatment of Chronic
Diseases (2017-2025) (ಂ஝ྌ(2017-2025 ϋ)), which
designated endocrine diseases as a category of chronic diseases that is of high
national priority.
 Policies to encourage the development of pediatric drugs. Since 2015, several policy
documents were endorsed to improve the drug approval process and better the
distribution of pediatric-friendly drugs, with key policies outlined as follows:
/H18537In January 2020, the Drug Registration Regulation issued by the SAMR
announced that priority review and approval may be available to the
application of drug marketing authorization for new varieties, dosage forms
and specifications of pediatric drugs.
/H18537In November 2021, the National Health Commission issued the Administrative
Measures for the National Essential Drugs List (Draft Revision) (ਿ͉
ج(ࣩ)) for public comments, which adds a special
category for pediatric drugs.
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/H18537The CDE has also in recent years issued a number of technical guidelines on
the pharmacy, clinical pharmacology and clinical development of pediatric
drugs, and to encourage pharmaceutical companies to develop new pediatric
drugs.
 Policies to promote children’ s health . In July 2019, the Healthy China Action
Promotion Committee issued the Healthy China Action (2019-2030) ( ਄ੰʕ਷Б
ਗ(2019-2030 ϋ)), announcing a national goal to reduce the rate of stunting in
children aged under five from 8.1% in 2013 to below 7% by 2022 and below 5% by
2030. In line with the Healthy China Action (2019-2030), in September 2021, the
State Council issued the Outline on the Development of Chinese Children
(2021-2030) (ࠅ2021-2030 ϋ)), also setting target to reduce
the rate of stunting in children aged under five to below 5% by 2030. In June 2021,
the CPC Central Committee and the State Council jointly issued the Decision on
Optimizing the Birth Policy to Promote the Long-term Balanced Development of the
Population (), namely, the
“three-child policy,” representing a major turn of China’s birth policies. Under this
policy, the government will attach great importance to children’s health.
 Policies to encourage innovation and accelerate new drug approval. China has
established a number of policies to promote innovation and improve the accessibility
of new drugs, including through fast track and priority review system, breakthrough
therapy designation and conditional approval as well as the acceptance of foreign
clinical data. Such policies include the Drug Administration Law of the PRC last
amended in 2019 () and the Opinions of the State
Council on Reforming the Evaluation and Approval System for Drugs and Medical
Devices (จԈ) and the Opinions
on Deepening the Reform of the Review and Approval System and Encouraging the
Innovation of Drugs and Medical Devices (ۜ
จԈ).
 Policies to enhance accessibility through pricing and reimbursement. The PRC
government has been taking steps to improve the accessibility of innovative drugs
through expanding the NRDL and national essential drug list (“NEDL”) at an
increasing frequency. Specifically, NRDL is to be updated annually and NEDL is to
be updated every three years in principle. Innovative drugs addressing urgent
clinical needs are increasingly admitted into the NRDL scheme through a
mechanism named “dynamic adjustment.” 36 drugs were incorporated into the
NRDL through the dynamic adjustment mechanism in 2017, 17 were included in
2018, 70 were included in 2019, 119 were included in 2020, 67 were included in
2021, 111 were included in 2022, and 126 were included in 2023.
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 Measures to combat rare diseases. Some endocrine diseases are also rare diseases.
In a country of around 1.4 billion people, “rare” translates to millions of people who
suffer from these diseases. To combat rare diseases, the PRC authorities published
the first and second rare disease catalogue in May 2018 and September 2023
covering 121 and 86 diseases, respectively. According to the Procedure on
Formulation of Rare Disease Catalogue (ʈЪ೻ҏ), the
catalogue will be updated from time to time, with each update taking no less than
two years to complete. Additionally, 14 rare disease drugs were added to the NRDL
in total in 2021 and 2022, and it is expected that more will be included in following
years.
 Policies to facilitate the review and approval process of Local BLA. According to the
Announcement on the Relevant Matters of Optimizing the Application for Market
Registration of Foreign-manufactured Drugs Transferred to Domestic Production for
Marketing (ɪ̹ൗ
ʮѓ), the NMPA will prioritize the evaluation and approval
process for marketing registration applications of overseas-original chemical
pharmaceuticals and biological products that have obtained marketing approval for
shifting to domestic manufacture.
These favorable government initiatives will continue to encourage drug innovation and
drive the growth of the endocrine drug market in China. See “Regulatory Environment –
Regulations on Pharmaceutical Product Development, Approval and Registration in the PRC –
Regulations on the Clinical Trials and Registration of Drugs” for more details regarding
favorable government policies and ongoing healthcare reforms.
HUMAN GROWTH HORMONE
Functions of Growth Hormone
Growth hormone is produced by the pituitary gland. It has many functions including
maintaining normal body structure, cardiovascular activities and metabolism. While PGHD is
one of the primary causes of poor growth in children, adult GHD is characterized by a number
of variable symptoms including reduced energy levels, altered body composition, reduced bone
mineral density, reduced muscle strength and impaired cardiac function. GHD is mainly caused
by insufficient growth hormone due to factors such as congenital genetic variation, certain
diseases, injuries or surgical removal of the anterior pituitary gland, and most of them are not
preventable. As advised by Frost & Sullivan, there is only one treatment option for GHD,
which is the hGH treatment.
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Short Stature in Children
Short stature refers to individuals of the same race, sex and age who are less than two
standard deviations (-2SD) or lower than the third percentile (-1.88SD) of the average height
of the normal population in similar living environments. The prevalence of short statures in
patients aged below 18 was 8.1 million in 2023 in China. PGHD, idiopathic short stature
(“ISS”), and small for gestational age (“SGA”) are the most common types of short stature,
representing 41.5%, 38.8% and 7.2% of the total short stature patients aged below 18 in China.
The chart below summarizes the estimated prevalence of various types of short statures and
their breakdown.
Prevalence Breakdown of Different Types of Short Statures in Patients
Aged Below 18 in China, 2023
SGA
7.2%
ISS
38.8%
TS
2.1%
NS
0.2%
PWS
0.1%
PGHD
41.5%
Others
10.1%
Notes: TS = Turner Syndrome; NS = Noonan Syndrome; PWS = Prader-Willi Syndrome; Others include multiple
pituitary hormone deficiency, hypothyroidism, malnutrition, pituitary tumor , Russel-Silver syndrome, chronic kidney
disease and some other diseases, for most of which hGH has no approved indications
Source: Literature Review, Frost & Sullivan Analysis
PGHD represents the most common short stature in patients aged under 18. PGHD is a
medical condition of noticeable short height in children due to insufficient growth hormone.
Growth hormone produces its effects both directly in peripheral tissues, such as epiphyseal
chondrocytes and adipocytes, and indirectly via stimulation of local and hepatic IGF-1
production. Growth hormone and IGF-1 work in concert, with IGF-1 augmenting the anabolic
actions of growth hormone while opposing the hyperglycemic and lipolytic effects of growth
hormone. PGHD can be (i) congenital, resulting from genetic mutations or from structural
defects in the brain; (ii) acquired later in life as a result of trauma, infection, radiation therapy,
or tumor growth within the brain; or (iii) idiopathic with no known or diagnosable cause. The
burden of PGHD is considerable and not limited to short stature. The severity of PGHD impact
on children appears to be variable and individualized, but early diagnosis and growth hormone
treatment may lead to fewer long-term complications. The prevalence of PGHD in China was
3.4 million in 2023, indicating significant unmet medical needs.
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Prevalence and Estimated Treatment Rate of PGHD in China, 2018-2030E
2018 2019 2020 2021 2022 2023 2024E 2025E 2026E 2027E 2028E 2029E 2030E
in thousands except percentage
Prevalence 3,370.8 3,371.3 3,393.1 3,385.5 3,374.6 3,364.7 3,352.0 3,339.1 3,321.5 3,303.3 3,281.0 3,261.7 3,244.3
Estimated
Treatment Rate 3.7% 3.9% 4.2% 4.5% 4.8% 5.3% 5.8% 6.5% 7.2% 8.0% 8.8% 9.7% 10.7%
Source: Expert Interview, Literature Review, Frost & Sullivan Analysis
Besides PGHD, there are other pathological short stature diseases that may be eligible for
hGH treatment, as set forth below. These diseases are distinguished from PGHD in respect of
specific conditions and causations.
 Idiopathic Short Stature. ISS is a condition in which the height of the individual is
more than two standard deviations (“SD”) below the corresponding mean height for
a given age, sex and population group, and in whom no identifiable disorder is
present. ISS is primarily caused by genetic and environmental factors, and is a
diagnosis arrived after other recognizable causes of short stature have been
excluded. Therefore, ISS children represent a highly heterogeneous population with
multiple potential pathophysiological mechanisms. It is likely that more identifiable
clinical conditions that nowadays are still resting under the cover of the term
“idiopathic” will be discovered in the upcoming years. The prevalence of ISS
children in China was 3.1 million in 2023.
 Small for Gestational Age. SGA is a condition in which birth weight and/or length
are at least two SDS below the mean for gestational age. Most children who are SGA
experience catch-up growth and achieve a height over two SDS below the mean. The
catch-up process is usually completed by the time the subject reaches two years old.
The prevalence of SGA children in China was 582.9 thousand in 2023.
 Turner Syndrome. TS results when one of the X chromosomes is completely or
partially missing. TS can cause a variety of medical and development problems,
including short stature, failure of the ovaries to develop and heart defects. Adults
with TS are on average 20 cm shorter than the normal female population. hGH has
been approved by the FDA for the treatment of short stature associated with TS. The
prevalence of TS children in China was 171.8 thousand in 2023.
 Noonan Syndrome. NS is an autosomal dominant condition or a genetic mutation.
The pathogenesis of NS is mainly related to the abnormal Ras-MAPK signal
pathway which involves more than 16 genes. NS prevents the normal development
of different parts of the body and is commonly characterized by short stature. There
is currently a lack of experience in the diagnosis and treatment of NS in China. The
prevalence of NS children in China was 19.5 thousand in 2023.
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 Prader-Willi Syndrome. PWS is a genetic disorder caused by the lack of expression
of genes on the paternally inherited chromosome 15q11.2-q13 region, affecting
approximately one in 15,000 to 30,000 live births. The gender ratio of the patients
is approximately one to one. PWS is characterized by infantile hypotonia, failure to
thrive and other conditions, due to growth and other hormone deficiencies. The
prevalence of PWS children in China was 8.1 thousand in 2023.
The hGH Market in China
The hGH market in China grew rapidly from RMB4.0 billion in 2018 to RMB11.6 billion
in 2023, at a CAGR of 23.9%, and is expected to continue to grow to RMB28.6 billion by 2030,
at a CAGR of 13.7% from 2023 to 2030, according to Frost & Sullivan. The foregoing
projection of the hGH market growth in China is based on the following underlying
assumptions:
 Increasing demand of hGH treatment. There exists market demand generated by the
continuous increase in the incidence of GHD and the limitation of existing
treatments. A number of indications can be addressed by hGH treatment, including
PGHD, ISS, SGA, NS, TS and PWS, which lead to the total prevalence in China
reaching 7.3 million in 2023. Further, the treatment rate for PGHD in China is
expected to increase from 5.3% in 2023 to 10.7% in 2030.
 Emergence of hGH treatment. Formulation of hGH treatment such as LAGH
improves compliance and treatment outcomes, which will lead to an increase of hGH
penetration of patients. By 2030, the LAGH market is expected to reach RMB21.1
billion and account for approximately 73.8% of the total hGH market in China.
 Increasing awareness of GH deficiency and increasing patient affordability. With
the development of society and economy, people’s health awareness has gradually
increased. The per capita disposable income of China was US$5,444.8 in 2021 and
is expected to continue to grow rapidly to US$7,325.5 by 2025, based on historical
data released by the National Bureau of Statistics of China (୕
҅), growth rate of the Chinese economy and foreign exchange fluctuations. The
increase in per capita disposable income will enhance patients’ willingness and
ability to pay for hGH therapy, even at a higher cost for novel medications. With
more attention and patient affordability of hGH treatment, the diagnosis and
treatment rate will raise, which will propel the hGH market growth.
From 2018 to 2023, the hGH market in China achieved a higher CAGR than the hGH
market in the United States, according to Frost & Sullivan. China accounted for the largest
share of the global hGH market in 2023, surpassing the United States and representing 34% of
the global market. Despite the already large market size for hGH in China, the country’s
potential for market growth remains high, primarily due to the expected continuous growth in
the treatment rate of short statures, early initiation and extending of GH treatment durations
and therapy upgrade from daily to weekly GH treatment.
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In addition to its significant market size and vast growth potential, the hGH market in
China is also less vulnerable to potential governmental cost-cutting measures (e.g., NRDL
negotiations, volume-based procurement) that may affect reimbursed drugs, given the sales
paid by the national healthcare system only account for a small portion of the overall hGH
market in China. Specifically, the majority of the hGH market in China is covered by private
hospitals and clinics, where drugs are not eligible for reimbursement; the remaining portion is
covered by public hospitals, where only a fraction of patients are eligible for governmental
reimbursement, and may not be reimbursed in full. The chart below illustrates the historical
and forecast size of the hGH market in China.
China hGH Market Size and Forecast, 2018-2030E
Period
2018-2023
2023-2030E
CAGR
23.9%
13.7%
Billion RMB
2018 2019 2020 2021 2022 2023 2024E 2025E 2026E 2027E 2028E 2029E 2030E
4.0
5.7
6.9
9.4
11.3 11.6
12.5
14.5
17.2
20.3
23.5
26.2
28.6
Source: Expert Interview, Annual Report, Frost & Sullivan Analysis
Formulations of hGH Treatments – Short-acting Growth Hormone and Long-acting Growth
Hormone
By frequency of administration, hGH therapies can be categorized into short-acting
growth hormone treatments and LAGH treatments.
Short-acting Growth Hormone
Short-acting growth hormone treatments require daily administration and come in either
powder or liquid form, customarily referred to as “short-acting powder” and “short-acting
liquid.” Launched in 1998, short-acting powder was the first short-acting growth hormone
treatment available in China. Short-acting powder was administered with a standard syringe
instead of easy injection device, as its freeze-dried nature would require reconstitution before
use, making it less convenient than prefilled devices. The administration of short-acting
powder was often associated with a complex injection process and patient discomfort. Such
administration can be distressing for patients, resulting in non-adherence and reduction of
treatment outcomes, and therefore had limited market acceptance and commercial success.
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Short-acting liquid was the second formulation of hGH treatment available in China,
which was less complex to administer with the introduction of easy injection devices. As a
result, its market share gained traction quickly and is currently the most popular treatment for
PGHD.
However, the burden of daily injections over the course of many years caused missing
doses during treatment and premature discontinuation of therapy for many patients, which
affected treatment outcomes. According to Frost & Sullivan, in a 2021 study, up to 82% of
patients with PGHD missed at least one daily injection per week. In a separate study of 110
children, two out of three patients missed more than one injection per week on average. For
patients who missed over one dose per week, there was a clinically relevant reduction in their
change in height velocity standard deviation score (“HVSDS”) as compared to patients that
missed no more than one dose on average. A greater HVSDS indicates more rapid growth.
Height Velocity Standard Deviation Score According to the Level of Compliance with
Four-Month hGH Treatment
0
1
2
3
Height velocity SDS
≥3 2 ≤1
P<0.001
n = 29 (26.3%)
P<0.01
n = 51 (46.4%)
n = 30 (27.3%)
Doses missed per week
Source: Cutfield WS, Derraik JG, Gunn AJ, et al. Non-compliance with growth hormone treatment in children is
common and impairs linear growth. PLoS One. 2011 Jan 31;6(1):e16223
Long-acting Growth Hormone
To overcome the limitations associated with short-acting growth hormone treatments,
LAGH was introduced as a new formulation, aiming to reduce injection frequency and thereby
improve compliance and treatment outcomes. Due to the potential significant advantages of
LAGH over short-acting growth hormone treatment in terms of increased acceptance,
tolerability, and therapeutic flexibility to patients, LAGH is expected to gradually replace
short-acting growth hormone treatment as the go-to treatment for PGHD. The LAGH market
is projected to continue to grow significantly and overtake the short-acting growth hormone
treatment markets, according to Frost & Sullivan.
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The table below sets forth a comparison of hGH treatments in China.
Comparison of Different Formulations of hGH Treatments in China
Original
Launch
Y ear in
China Injection and Compliance
Estimated
Average Annual
Treatment Cost
in China
in 2023
Per Patient
(RMB)*
Short-acting Growth
Hormone (Powder)
1998  Complex injection preparation
with multiple steps to operate
due to the lack of injection
devices in China
 Daily injection leads to poor
adherence and compromised
treatment outcomes
23,813 to
28,612
(1)
Short-acting Growth
Hormone (Liquid)
2005  Less complex than short-acting
powder, but still requires daily
injection which affects treatment
outcomes
60,845 to
69,974
(1)
LAGH 2014  Weekly injection that largely
improves compliance and
thereby potentially maximizes
clinical efficacy
121,333
(2)
* Only includes annual cost of major players whose market share is more than 5%.
(1) The calculation of annual cost for Short-acting Growth Hormone assumes: (i) the average weight of patients
is 30kg; and (ii) the dose of Shorting-acting Hormone is 0.15 IU/kg per day.
(2) The calculation of annual cost for LAGH assumes: (i) the dose of LAGH is 0.2 mg/kg per week; (ii) there are
52 weeks in a year; and (iii) the average weight of patients is 30kg.
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The table below sets forth a breakdown of the market sizes of hGH treatments by
formulation.
China hGH Market Breakdown by Formulation, 2018-2030E*
0.0
5.0
10.0
15.0
30.0
25.0
20.0
LAGH
7.5% 9.5% 9.7%
14.9%
19.8%
25.0%
31.5%
42.2%
51.9%
60.2%
66.3%
70.6%
73.8%
2018 2019 2020 2021 2022 2023 2024E 2025E 2026E 2027E 2028E 2029E 2030E
21.10.3 0.5 0.7 1.4 2.2 2.9 3.9 6.1 8.9 12.2 15.6 18.5
Billion RMB
Short-acting Liquid 5.92.4 3.5 4.4 5.9 6.9 6.6 6.6 6.5 6.4 6.3 6.2 6.0
Short-acting Powder 1.61.3 1.6 1.8 2.1 2.2 2.1 2.0 1.9 1.9 1.8 1.7 1.7
CAGR
2018-2023
2023-2030E
Short-acting
(powder)
10.0%
-3.7%
Short-acting
(liquid)
22.6%
-1.7%
LAGH
57.4%
32.8%
Total hGH
23.9%
13.7%
LAGHShort-acting (liquid)Short-acting (powder) LAGH/hGH (%)
Source: Expert Interview, Literature Review, NMP A, Frost & Sullivan Analysis
* In general, the hGH market size in China is derived from a bottom-up approach by studying the historical
revenues of marketed products. The future market size is primarily forecasted by estimating the prevalence of
PGHD and other diseases requiring hGH therapies, treatment rates, treatment costs and patient compliance in
China during the forecast period. The following key assumptions are used for the purpose of estimating hGH
market size in China, as a whole and by formulation:
(i) The number of patients receiving hGH therapies largely depends on the number of PGHD patients
receiving hGH therapies, which is calculated by multiplying the prevalence of PGHD by the treatment
rate. As PGHD affects newborn to children as old as 17, the prevalence of PGHD is expected to slightly
decrease from 2023 to 2030. Despite the slightly decreased prevalence, the treatment rate for PGHD is
expected to more than double from 2023 to 2030. According to clinical and expert interviews, as
awareness of growth hormone deficiency in adolescents increases, the diagnosis and treatment rates will
continue to rise, leading to more hGH users. With improved compliance and fewer missed doses, LAGH
is expected to gain market traction and patient adoption, and its market penetration will grow. The
treatment rate is expected to drive the increase of the number of treated PGHD patients during the same
period.
(ii) The annual treatment cost for short-acting growth hormone is lower than that of LAGH. Short-acting
powder costs RMB20,000 to RMB30,000 and short-acting liquid costs RMB60,000 to RMB70,000,
while LAGH costs approximately RMB120,000. The market size for LAGH is driven by the number of
patients receiving the treatment and the cost of the treatment. The increasing number of LAGH users,
with its higher price, will accelerate the growth of both the LAGH and hGH markets.
(iii) It is estimated that at least four LAGH products will be approved and commercially launched in China
within the next five years, given that it typically takes approximately one to five years to advance
Phase III- and Phase II-staged LAGH candidates to market approval stage.
(iv) It is estimated that LAGH will be associated with longer treatment cycles compared to that of
short-acting growth hormone, as patient compliance with LAGH is expected to be significantly higher
than with short-acting growth hormone. Short-acting growth hormone requires daily injections, which
often leads to missed doses, insufficient usage, or early discontinuation, affecting its efficacy. LAGH,
on the other hand, requires less frequent injection and reduces discomfort for patients compared to that
of short acting growth hormone which potentially improves the patient compliance with LAGH as
compared to short acting growth hormone. As a result, LAGH’s market penetration is expected to grow
rapidly, increasing the market size.
(v) It is estimated that LAGH will attract more patients to undergo treatment, as with improved patient
compliance and fewer missed doses, LAGH offers improved efficacy. As market promotion and patient
adoption increase, LAGH’s market penetration is expected to grow in the future. Despite being more
expensive than short-acting growth hormone, advances in medical care and economic conditions will
enable more patients with PGHD to access and afford LAGH treatment, thereby increasing the overall
treatment rate. Supportive government policies and expanded health insurance coverage are likely to
make LAGH treatment more accessible to a larger patient population, which will drive the LAGH
market growth.
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Development of Long-acting Growth Hormone Treatments
V arious technical approaches are being employed to develop LAGH drugs, some of which
may come with inherent limitations. The chart below sets forth the technologies currently
employed to develop LAGH, their formations, pros and cons and structures.
Technologies Currently Employed to Develop Long-acting Growth Hormones
Approach – Unmodified hGH
Formulation
Representative
Products
(Companies) Pros Cons Illustration
Pro-drug
formulation
 Lonapegsomatropin
(Ascendis Pharma,
VISEN)
 Predictable
release of
hGH
 Unmodified
hGH, full
activity
 Same binding
affinity and
tissue
distribution as
endogenous
growth
hormone
 More sophisticated
manufacturing
technology required
Depot
formulation
(currently
withdrawn
from the
United States
market)
 Nutropin Depot
(Genentech)
 LB03002
(LG Life
Sciences)
 Unmodified
hGH, full
activity
 Limited by loading
efficiency of carrier
 High initial burst
release, and delay
of release after the
initial burst
 Incidence of non-
neutralizing
antibodies 5x higher
than daily hGH
 Injection site
reactions
hGH
Spheroid
microparticles
containing hGH
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Approach – Modified hGH
Formulation
Representative
Products
(Companies) Pros Cons Illustration
PEGylated
formulation
 Jintrolong
(GeneScience
Pharmaceuticals)
 PHA-794428
(Pfizer)
 NNC126-0083
(Novo Nordisk)
 ARX201 (Ambrx)
 Adjustable
half-life
based on
PEG size
 Increased risk of
lipoatrophy
 Compromised tissue
distribution
causing metabolic
imbalance
 Decreased growth
hormone receptor
affinity
Modified hGH
Permanent conjugation
GH
PEG
Non-Covalent
Albumin
Binding hGH
 Sogroya
®/
Somapacitan/
NNCO195-0092
(Novo Nordisk)
 Adjustable
half-life
based on
binding
affinity of
fatty acid to
albumin
 Lipoatrophy
reported in Sogroya
Phase 2 study
 Compromised tissue
distribution causing
metabolic imbalance
GH
Albumin binding moiety
covalently attached
to modified hGH
albumin
  binding moiety
Albumin
hGH fusion
protein
 Albutropin/
TV-1106 (Teva)
 Somavaratan/VRS-
317
(V ersartis)
 NGENLA/
Somatrogon/
MOD-4023
(Pfizer and
OPKO Health)
 Eftansomatropin/GX-
H9/TJ101
(Genexine, and
Handok)
 LAPS-
hGH/HM10560A
(Hanmi
Pharmaceutical)
 Increased
half-life
 Increased risk of
lipoatrophy
 Decreased growth
hormone receptor
affinity
 Increased risk of
inducing
neutralizing
antibodies
 Injection site
reactions
 Compromised tissue
distribution causing
metabolic imbalance
Fc protein
or albumin,
CTP, XTEN,
etc.
Permanent conjugation
GH
Source: Literature Review, Frost & Sullivan Analysis
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Global hGH Market Landscape
The global hGH market is a dynamic sector which can be categorized into short-acting
growth hormone treatments and LAGH treatments based on the frequency of administration.
The LAGH treatments in the global hGH market have seen both unmodified hGH and modified
hGH approaches being employed to develop LAGH drugs. In terms of short-acting growth
hormone treatments in the global hGH market, daily administration of growth hormone
treatment has been in clinical use for treatment for GHD for years. Due to the long-term proven
effectiveness and economy of short-acting growth hormone, the current treatment of GHD
mainly relies on short-acting growth hormone. There are currently more than 30 short-acting
growth hormones drugs approved in the global hGH market.
In terms of LAGH treatments in the global hGH market, out of the nearly 20 LAGH
drug candidates that were once in the clinical-stage, or even approved, most did not
reach commercial stage primarily due to clinical trial data issue, including high rate of
lipoatrophy at injection site, unsatisfactory IGF-1 profile peak, duration and presumed
unfavorable benefit risk profile ratio, such as PHA-794428 (developed by Pfizer) and
NNC126-0083 (developed by Novo Nordisk) both utilizing PEGylated hGH formulation and
TV-1106 utilizing growth hormone fusion protein (developed by Teva), and some reached
commercial stage but were subsequently removed from the market primarily due to factors
including market development strategies, cost considerations and competitive advantages and
disadvantages of the product, such as Nutropin Depot utilizing Depot formulation (developed by
Genentech). Due to technological limitations, there remains a significant unmet need for safe and
effective LAGH therapies and long-acting technologies. Enabled by the flexible, versatile and
reliable transient conjugation technology (TransCon), lonapegsomatropin is the first once-weekly
LAGH replacement therapy for PGHD approved both in the United States and the European
Union, receiving marketing approvals from the FDA and the EMA on August 25, 2021 and
January 12, 2022, respectively. The tables below set forth an overview of the development
attempts of LAGH formulations for the treatment of PGHD.
Marketed LAGH Therapies for PGHD Globally, as of the Latest Practicable Date
Approach Product Company
Region(s) Approved for
Marketing
Unmodified hGH Lonapegsomatropin
(Transiently PEGylated
hGH prodrug (22 kDa as
released active drug))
Ascendis
Pharma
 Approved in the United
States and the European
Union
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Approach Product Company
Region(s) Approved for
Marketing
Nutropin Depot ®
(Encapsulated in
biocompatible,
biodegradable, polylactide-
coglycolide polymer
microsphere (22 kDa))
Genentech  Approved in the United
States; later
withdrawn
(1)
Eutropin Plus™/LB03002
(Microparticles containing
hGH incorporated into
sodium hyaluronate and
dispersed in an oil base of
medium-chain triglycerides
(22 kDa))
LG Life
Sciences
 Approved but not
marketed in the
European Union
 Marketed in South
Korea
Modified hGH Jintrolong
® (40-kDa PEG
attached to hGH (62 kDa))
GeneScience
Pharmaceuticals
 Approved in China
Sogroya (Single-point
mutation in hGH, with
albumin binding moiety
attached (non-covalent
albumin-binding properties)
(23 kDa))
Novo Nordisk  Approved mainly in the
United States and the
European Union
Ngenla (recombinant hGH
fused to three copies of
carboxyl-terminal peptide
(CTP) of hGH b-subunit
(41 kDa))
Pfizer and
OPKO Health
 Approved mainly in the
European Union and
United States
(1) Withdrawn due to manufacturing issues and inferior efficacy reported during post-marketing follow-up trials.
Source: FDA, EMA, NMP A, Clinicaltrials.gov, Frost & Sullivan Analysis
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LAGH Therapies for PGHD in Clinical Development Globally, as of the Latest
Practicable Date
Approach Product Company
Development
status Y ear*
Modified
hGH
Eftansomatropin/GX-
H9/TJ101 (recombinant hGH
fused to hybrid noncytolytic
immunoglobulin Fc portions
of IgD and IgG4 (100 kDa))
Genexine and
Handok
Phase 2 globally 2017
I-Mab Biopharma
and JumpCan
BLA in China 2024
* Refers to the year when the latest clinical trials started
Source: ClinicalTrials.gov., CDE, Frost & Sullivan Analysis
Discontinued Clinical Development of LAGH Therapies for PGHD, as of the Latest
Practicable Date
Approach Product Company
When the
clinical
development was
discontinued
Reasons for
discontinuation
Unmodified
hGH
ALTU-238 (Long-
extended release
formulation using protein
crystallization technology
(22 kDa))
Altus 2009 The manufacturer had run
out of funds
Modified
hGH
PHA-794428 (Branched
40 kDa PEG on
N-terminus of hGH (62
kDa))
Pfizer 2009 High rate of lipoatrophy
at injection site
NNC126-0083 (43-kDa
PEG residue attached to
glutamine 141 (65 kDa))
Novo
Nordisk
2011 Unsatisfactory IGF-1
profile peak and duration
ARX201 (30-kDa PEG
added to unnatural amino
acid incorporated into
hGH (52 kDa))
Ambrx 2009 PEGylated-containing
vacuoles in the epithelial
cells of the choroid
plexus in monkeys
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Approach Product Company
When the
clinical
development was
discontinued
Reasons for
discontinuation
Albutropin/TV-1106
(Human serum albumin
fused to N-terminus of
hGH (88 kDa))
Teva 2016 The development of
potentially inactivating
antibodies; studies in
adult growth hormone
deficiency (“AGHD”)
discontinued for unknown
reason; presumed
unfavorable benefit risk
profile ratio
Somavaratan/VRS-317
(Fusion protein of
recombinant hGH and the
pharmacologically
inactive portion of long
chains of natural
hydrophilic amino acids
(XTEN technology) (119
kDa))
V ersartis 2017 The Phase 3 study did not
meet its primary endpoint
for non-inferiority
comparison against daily
recombinant hGH for
height velocity in children
with PGHD
Source: ClinicalTrials.gov., Literature Review, Frost & Sullivan Analysis
China hGH Market Landscape
Most marketed hGH therapies in China are short-acting powder and short-acting liquid.
These daily hGH therapies are marketed by local biopharmaceutical companies, such as
GeneScience Pharmaceuticals, Anhui Anke and Shanghai United Cell, as well as Novo
Nordisk. Many of these marketed therapies target multiple indications, including GHD, severe
burns, Noonan and/or Turner syndrome. The table below sets forth an overview of the marketed
daily hGH therapies in China as of the Latest Practicable Date.
Marketed Daily hGH Therapies in China, as of the Latest Practicable Date
Manufacturer Generic Name Brand Name
Approval
Status/Date Formation
Changchun GeneScience hGH for Injection Jintropin 1998 Powder
Anhui Anke Recombinant Human
Growth Hormone
(rhGH) for Injection
Ansomone 1999 Powder
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Manufacturer Generic Name Brand Name
Approval
Status/Date Formation
Shanghai United Cell
Biotechnology
rhGH for Injection Genheal 1999 Powder
Zhongshan Sinobioway
Hygene Biomedicine
rhGH for Injection Haizhiyuan 1999 Powder
Kexing Biopharm rhGH for Injection Saigaolu 2002 Powder
Changchun GeneScience rhGH Injection Jintropin 2005 Liquid
LG Chem rhGH for Injection Eutropin 2012 Powder
Novo Nordisk hGH Injection Norditropin 2018 Liquid
Anhui Anke rhGH Injection Ansomone 2019 Liquid
Zhongshan Sinobioway
Hygene Biomedicine
hGH Injection Haizhiyuan 2023 Liquid
Currently in China, only one LAGH therapy has received marketing approval and several
are currently under clinical development, as outlined in the tables below.
Marketed LAGH Therapies in China, as of the Latest Practicable Date*
Brand Name Company Formulation
Development
Approach
NMPA Approval
Time Indication(s)
Jintrolong (1) GeneScience
Pharmaceuticals
PEGylated hGH Modified hGH 2014 PGHD
Clinical Stage Pipeline LAGH Therapies in China, as of the Latest Practicable Date*
Investigational
Drug Drug Form
Development
Approach Company
Global
Status
China
Status Date** Indication(s)
Lonapegsomatropin Transiently
conjugated
hGH
Unmodified
hGH
VISEN
(2) FDA & EMA
approved (3)
BLA March 7,
2024
PGHD
Y -shaped pegylated
somatropin
PEGylated
hGH
Modified
hGH
Xiamen
Amoytop
Not yet
initiated
BLA January 11,
2024
PGHD
Somapacitan-beco Mutated
hGH
attached to
an albumin
affinity tag
Modified
hGH
Novo
Nordisk
FDA & EMA
approved
BLA September 5,
2024
PGHD
PEG-recombinant
hGH
PEGylated
hGH
Modified
hGH
Anhui Anke Not yet
initiated
Phase 3 November 23,
2017
PGHD
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Investigational
Drug Drug Form
Development
Approach Company
Global
Status
China
Status Date** Indication(s)
Eftansomatropin
GX-H9/TJ101
Hy-Fc
(Fc fusion-
protein)
Modified
hGH
Genexine/
I-Mab
Biopharma
Phase 2
completed
BLA December 7,
2024
PGHD
HSA-recombinant
hGH
HSA/
recombinant
hGH
Modified
hGH
Uniongen Not yet
initiated
Phase 3 May 22, 2024 PGHD
QHRD211/ZHB111 PEGylated
hGH
Modified
hGH
Qianhong
Biopharma
Not yet
initiated
Phase 2/3 August 13,
2024
PGHD
AK2017 Fc fusion
protein
Modified
hGH
Anhui Anke Not yet
initiated
Phase 2 December 27,
2023
PGHD
F-899 (Fc fusion
protein)
Fc fusion
protein
Modified
hGH
Yifan Not yet
initiated
Phase 1 May 28, 2021 N/A
GB08 PEGylated
hGH
Modified
hGH
Kexing
Biopharm
Not yet
initiated
Phase 1 June 7, 2024 PGHD
* All marketed and clinical-stage pipeline LAGH therapies were and/or are being studied in active-controlled
and parallel-group trial comparisons with daily hGH. Pricing information for the marketed LAGH in China
varies across different geographic areas and depends on body weight of the patients. Pricing information is not
available for LAGH therapies in clinical development in China. The route of administration for all marketed
and clinical-stage LAGH therapies in China is in the form of injection.
** Refers to date when the clinical trial information was first publicly posted.
Notes:
(1) In 2023, the median unit price of Jintrolong in China is RMB3,500/(1ml:54IU). As of the Latest Practicable
Date, Jintrolong has not been included in the NRDL.
(2) VISEN has gained exclusive licensed rights to develop, manufacture and commercialize in China (including
Hong Kong, Macau and Taiwan); Ascendis Pharma retains the rights to develop, manufacture and
commercialize outside of China (including Hong Kong, Macau and Taiwan).
(3) Lonapegsomatropin is the first once-weekly LAGH approved by both the FDA and EMA for PGHD.
Source: CDE, NMP A, FDA, Clinicaltrials.gov, Frost & Sullivan Analysis
The criteria for a successful LAGH include not just weekly dosing regimen, but also at
least non-inferior efficacy and safety to daily hGH. Many LAGH development projects failed
because of either insufficient or inconsistent efficacy or unwanted safety issues.
Lonapegsomatropin is designed based on the transient conjugation technology
(TransCon). The “conjugation” enables extended half-life and therefore a weekly dosing
scheme, while the “transient” feature enables the release of unmodified hGH in controlled
manner into the bloodstream which is identical to the endogenous growth hormone.
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Due to these unique features, somatropin released from lonapegsomatropin retains the
same mode of action and the same physiological volume of distribution as the endogenous
growth hormone. Endogenous growth hormone has dual modes of action, with direct action by
circulating growth hormone on target tissues and indirect action through promoting IGF-1
production in the liver (via growth hormone receptor). In contrast, modified hGH often
substantially alters its molecular size, which changes its receptor binding affinity and its ability
to reach the target tissue. The active component of lonapegsomatropin is the released hGH,
which is identical in molecular structure to the endogenous growth hormone, the safety profile
of which has been clinically proven for almost four decades. In contrast, the modified LAGH
is a new active drug molecule, with no prior clinical safety experience outside of its clinical
trials. Before the hGH is released in the bloodstream, lonapegsomatropin exists as an inactive
prodrug, it therefore presents no biological activities and is well tolerated at the injection
site-subcutaneous tissue. In contrast, some modified LAGH has shown severe injection site
reactions or even lipoatrophy due to high dose and long exposure of active molecule at the
injection site.
Due to the design advantages of lonapegsomatropin, it has proven, in the global Phase 3
active-controlled, parallel-group comparison trial, non-inferiority, as well as superior efficacy
to daily hGH, as evidenced by an annual height velocity of 11.2 cm/year compared to 10.3
cm/year for daily hGH, with a p-value of 0.0088, at 52 weeks. It has also demonstrated similar
safety to daily hGH, and became the first once-weekly LAGH approved by both the FDA and
EMA for PGHD. The completed China Phase 3 pivotal trial continued to support
lonapegsomatropin’s superior growth profile and comparable safety profile in comparison to
daily hGH, where lonapegsomatropin was associated with an AHV of 10.66 cm/year at 52
weeks compared to 9.75 cm/year for daily hGH, with a p-value of 0.0010. These trials proved
that weekly lonapegsomatropin is the first and only LAGH with data demonstrating superior
efficacy compared to a daily somatropin.
In addition, lonapegsomatropin is coupled with an auto-injector device that offers easy
injection, hidden needle, small injection volume, and six-month room temperature storage
features, all of which can dramatically improve patient injection experience and become
competitive advantages. The FDA approval of lonapegsomatropin includes the new auto-
injector and cartridges, which allow families to store the medicine at room temperature for up
to six months as compared to other daily or weekly recombinant growth hormones launched in
China, which typically require storage at temperatures between 2-8°C.
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Key Drivers of the hGH Drug Market in China
 Increasing patient penetration. The diagnosis rate and treatment rate of short stature in
children will be driven by a variety of factors including government policy on improving
children’s health, increased health awareness and the advancement of clinical diagnosis
capabilities. The treatment rate for PGHD in China is expected to increase from 5.3% in
2023 to 10.7% in 2030, according to Frost & Sullivan. The increasing diagnosis rate,
along with the development of safer and more easily administered treatment regimens,
will also directly improve treatment rate. The increasing patient penetration is expected
to fuel the growth of the hGH market in China.
 Earlier diagnosis and initiation of treatment . As growing individuals, children have
special needs related to growth and development, and hence they often face a limited
treatment window and an urgent need for timely treatment. While children in China are
currently suffering from late diagnosis, which delays the initiation of treatment, early and
precise diagnosis and effective treatment solutions for PGHD will be available with the
establishment of standardized diagnosis and treatment guidelines, increasing
affordability, disease awareness and technological development. Earlier diagnosis and
treatment will also increase the number of younger patients in China who are more
sensitive to discomfort and pain, thus boosting the demand for more convenient treatment
options.
 The increasing acceptance of LAGH treatments. The increasing market acceptance of
premium-valued LAGH will drive a treatment paradigm shift towards LAGH and the
organic growth of the hGH drug market in China. Based on progress in both pre-clinical
and clinical science, particularly in areas of endocrinology and biotechnology, LAGH has
been achieving significant development. LAGH can create a more convenient growth
hormone dosing profile while retaining the excellent safety, efficacy and tolerability of
daily hGH. Many life circumstances can interfere with adherence to daily injections, thus
compromising therapeutic outcomes. A national survey from New Zealand showed there
were 66% patients missing doses more than 1 time per week and significantly
compromised linear growth (HV SDS). Research suggests less frequent injections would
be patient-friendly and are able to reduce non-adherence and subsequently improve
growth outcomes. The LAGH market will continue to grow significantly and overtake the
daily hGH market, according to Frost & Sullivan’s projection. According to Frost &
Sullivan, by 2030, the LAGH market is expected to reach RMB21.1 billion and account
for approximately 73.8% of the total hGH market in China.
 Increase in the average duration of treatment. The average duration of treatment (“DoT”)
for PGHD is less than 1.7 years in China, as compared to over 3.5 years in developed
countries, according to Frost & Sullivan. The average DoT for short stature in China is
expected to increase in the upcoming years due to a number of factors, including the
development of improved drug administration, introduction of more convenient injections
and expected earlier diagnosis and treatment, according to Frost & Sullivan. An increase
in the average DoT is expected to drive the growth of the hGH market in China.
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Entry Barriers for the hGH Drug Market in China
Despite the market potential and opportunities in the hGH drug market, the barriers to
entry remain high, primarily due to a combination of factors as highlighted below:
 Innovation in hGH treatment is capital intensive with heavy R&D capabilities and
costs. Many hGH drugs treat chronic conditions, and therefore require significant
resources and investments over a long period of clinical studies in order to obtain
regulatory approval for commercialization.
 Technical barriers to enter into the hGH drug market remain high. Growth hormone
is a product of genetic engineering which applies advanced molecular biology
technology and requires biological fermentation production line subject to strict
manufacturing standards. Further, recombinant human growth hormone liquid
injection that acts long-term applies permanent modification technologies such as
PEGylation and fusion protein, which calls for high requirements on strain
development, fermentation process management, and product purification.
 Physician awareness and patient education leading to drug adoption require
substantial efforts. Physician awareness, patient education and drug adoption are
critical components of launching a new hGH drug, in particular because the demand
for a particular hGH drug is largely driven by the prescription habits of physicians
who diagnose and treat endocrine patients. Since the GHD diseases are chronic in
nature and require long-term treatment as compared to acute diseases, it is critical
to establish a system for patient management and other follow-up services after
commercialization.
 Marketing of hGH drugs requires specialized professional team. Marketing of hGH
drugs often involves communication with HCPs and regulators, as well as insight
into therapeutic areas or indications, which requires a specialized professional team
to successfully execute commercialization strategies.
ACHONDROPLASIA
ACH is the most common form of dwarfism, occurring with a frequency of one in 30,000
to 10,000 among live birth and affecting approximately 250,000 people worldwide. ACH
results in severe skeletal complications and comorbidities, including foramen magnum and
spinal stenosis, sleep apnoea and chronic ear infections. Patients often face multiple surgeries
to alleviate its many complications. Due to the absence of approved therapy to treat the genetic
basis of ACH in China, according to Frost & Sullivan, it is currently unfeasible to determine
the market share and market size for ACH as there have been no corresponding sales generated
in China. The prevalence of ACH in China was 51.2 thousand in 2023 and is estimated to reach
51.9 thousand in 2030. Since ACH is mainly caused by genetics as a congenital disease,
normally there is no prevention method available. As advised by Frost & Sullivan, there is only
one treatment option for ACH, which is the CNP treatment.
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Competitive Landscape of the ACH Market in China
Currently, there is no approved therapy available in China to treat the genetic basis of
ACH, with medical and surgical interventions limited to addressing some of the symptoms,
including spinal stenosis, hydrocephalus and obstructive sleep apnoea. Some local hGH drugs
have expanded their indications to include short stature caused by ACH, such as Jintropin
(marketed by GeneScience Pharmaceuticals) and Ansomone (marketed by Anhui Anke).
However, none of these drugs are disease-modifying. According to the International
Achondroplasia Consensus Statement Group, the effect of growth hormone treatment in
children with ACH has been controversial and its long-term effect remains unclear. The chart
below sets forth ACH therapy in clinical development in China.
ACH Therapies with Clinical Activities in China, as of the Latest Practicable Date
Product Drug Structure Company Clinical Status
TransCon CNP
(navepegritide)
Prodrug of CNP VISEN (1) Phase 2
SAR442501 FGFR3 antibody Sanofi Phase 2
(1) VISEN has gained exclusive licensed rights to develop, manufacture and commercialize in China (including
Hong Kong, Macau and Taiwan); Ascendis Pharma retains the rights to develop, manufacture and
commercialize outside of China (including Hong Kong, Macau and Taiwan).
Source: CDE, Frost & Sullivan Analysis
Global ACH Market Landscape
Outside of China, as of the Latest Practicable Date, V oxzogo (vosoritide) (developed by
BioMarin) received marketing approvals from the FDA and the EMA, and Infigratinib/BGJ398
(developed by QED Therapeutics) is being developed in Phase 3 trials and TYRA 300
(developed by Tyra Biosciences) and RBM 007 (developed by Ribomic) are being developed
in Phase 2 trials.
Administration of CNP to patients with ACH and in animal models of ACH has been
found to stimulate growth. V oxzogo (vosoritide), as a CNP analogue, has been developed to
provide better stability of CNP and is approved by the FDA and EMA for the treatment of ACH
in the United States and the European Union, respectively. Due to the natural form of CNP
having a short half-life of only one to two minutes, which makes it unsuitable as a drug product
for maintaining stable CNP plasma concentrations, there is a need for the development of a
long-acting CNP formulation. V oxzogo (vosoritide) is a CNP-39 analogue that extends the
half-life of CNP to 20 to 45 minutes, but it still requires daily injections. In contrast, TransCon
CNP extends the half-life to approximately 120 hours, allowing for a more convenient
once-weekly dosing regimen.
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Unlike V oxzogo (vosoritide), TransCon CNP (navepegritide) is an investigational
long-acting prodrug of CNP designed to provide continuous CNP exposure at therapeutic levels
with a well-tolerated and convenient once-weekly dose. Leveraging the transient conjugation
technology (TransCon), TransCon CNP (navepegritide) provides a sustained exposure of active
CNP , allowing an optimal PK profile for use in pediatric patients with ACH, demonstrated by
observed apparent mean elimination half-life of 120 hours in adults (Phase 1 trial TCC-101)
supporting once-weekly dose administration. In addition to limited efficacy, short-acting CNP
and CNP analogues that result in high C
max levels may cause adverse cardiovascular events. As
ACH is caused by an FGFR3 mutation that chronically inhibits growth, a more constant CNP
exposure at lower C
max enabled by TransCon CNP (navepegritide) is expected to correlate with
better therapeutic outcomes, with lower cardiovascular risk. According to the topline results
from TransCon CNP’s (navepegritide) completed global Phase 2 clinical trial, the primary
endpoint, AHV at 52 weeks, demonstrated a greater AHV of 5.42 cm/year at 100 µg/kg/week
compared to AHV of 4.35 cm/year for placebo, with a p-value of 0.0218. The data showed
robust and consistent results in pre-specified analyses across age groups and dose levels,
supporting continued development at the selected dose of 100 µg/kg/week. TransCon CNP
(navepegritide) was generally well tolerated with low frequency of injection site reactions.
The table below sets forth a comparison between TransCon CNP (navepegritide) and
V oxzogo (vosoritide).
TransCon CNP
(navepegritide) Voxzogo (vosoritide)
Drug structure Prodrug of unmodified
CNP-38
Modified CNP-39 analog
Technology 38 C terminal amino
acids of the human
CNP53 transiently
conjugated to releasable
PEG carrier
37 C-terminal residues of the human
CNP53 sequence
Clinical
Development
Status
 Phase 2 in China
 Global pivotal Phase 3
 Approved by FDA and EMA
 No clinical activities in China
Half-life 120 hours 20-45 minutes
Administration Weekly injection Daily injection
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TransCon CNP
(navepegritide) Voxzogo (vosoritide)
Estimated Average
Annual
Treatment Cost
Per Patient
N/A Approximately US$350,000/year
(W AC) in the United States
Efficacy The primary endpoint,
annualized height
velocity at 52 weeks,
demonstrated a greater
AHV of 5.42 cm/year at
100 CNP µg/kg/week
compared to AHV of 4.35
cm/year for pooled
placebo, with p=0.0218
(Global Phase 2 trial
data).
The primary endpoint adjusted mean
difference in annualized growth
velocity (AGV) between patients in the
V oxzogo (vosoritide) group and placebo
group was 1.57 cm/year in favor of
V oxzogo (vosoritide). Mean AGV at
week 52 of 5.61 cm/year in the
V oxzogo group vs. 3.94 cm/year in
placebo.
Indications Under development for
the treatment of ACH
(pivotal Phase 3 in ages
2-11 years old)
Treatment of ACH in patients aged 5 or
older with open epiphyses for FDA and
aged 2 or older with open epiphyses for
EMA
Source: Literature review, Frost & Sullivan
Key Drivers of the ACH Therapeutic Market in China
 Lack of effective treatment and the development of emerging therapies. There is currently
no effective disease-modifying therapy for ACH approved in China, indicating ACH
patients’ urgent need for treatment. As the first ACH therapy that is under clinical
development in China, TransCon CNP (navepegritide), licensed to VISEN, is designed to
provide continuous CNP exposure at therapeutic levels with a well-tolerated and
convenient once-weekly dose, in order to continuously inhibit abnormal FGFR3
signaling, restore proliferation and differentiation of chondrocytes to rebalance bone
growth, and therefore has the potential to be a truly effective disease-modifying therapy
available in China. The rising development of drugs combined with the growing
awareness of this abnormality is expected to create growth opportunities for the ACH
therapeutic market in the coming years.
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 Favorable policies. To encourage the R&D of rare disease drugs, the PRC government has
initiated a series of actions, such as the implementation of an accelerated review system
and a priority review system for rare disease drugs and new drugs under the Drug
Administration Law of the People’s Republic of China 2019 (၍ଣ
, 2019). Other policies increasing the affordability of orphan drugs, reducing taxes
and introducing related drugs to the national medical insurance were also issued.
Entry Barriers for the ACH Therapeutic Market in China
Despite the market potential and opportunities in the ACH therapeutic market, the barriers
to entry remain high, primarily due to a combination of factors as highlighted below:
 Technical and requisite R&D capability barriers to enter into the ACH therapeutic
market remain high. Although the mode of action of CNP and its treatment potential
for ACH have been known for a long time, the extremely short half-life of
endogenous CNP , lasting only approximately two minutes, poses a significant
challenge in developing drugs that can maintain a sustained and stable drug
concentration in the blood. Furthermore, there is currently no effective disease-
modifying drug commercially available in China for ACH. Further, the lack of
patient data support for the pathogenesis, diagnosis and treatment methods of ACH
due to the limited number of cases and dispersed patients has created high scientific
research barriers for drug research and development.
 Marketing of ACH drugs requires substantial efforts. Providing sufficient physician
and patient education is important for launching new drugs into the market,
especially for drugs for the treatment of rare disease such as ACH, due to the
relatively limited number of patients and dispersed distribution. Therefore,
substantial efforts are needed for commercializing the ACH drugs.
 ACH drug development is capital intensive with substantial R&D costs. Developing
drugs for the treatment of rare diseases, such as ACH, entails substantial R&D costs,
including preclinical studies, clinical trials, regulatory submissions and post-
marketing surveillance.
HYPOPARATHYROIDISM
HP is a syndrome of abnormal calcium and phosphorus metabolism caused by decreased
secretion or defective function of PTH. It is characterized by hypocalcemia,
hyperphosphatemia and inappropriately low serum levels of PTH. HP may be due to congenital
or acquired disorders. The most common cause of acquired HP is surgery, accounting for
approximately 75% of all cases. Postsurgical HP occurs after thyroidectomy and
parathyroidectomy due to injury of parathyroid glands and/or their blood supply. Nonsurgical
causes of HP include autoimmune diseases or genetic abnormalities, invasive parathyroid
disease, and external beam therapy and radioactive iodine treatment of thyroid disease.
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Patients with HP cannot adequately regulate calcium and phosphate metabolism and
suffer from low calcium and elevated phosphate levels in the blood. The condition results in
a diverse range of physical, cognitive and emotional symptoms. Specifically, patients
experience fatigue, muscle pain or cramping, paresthesia, tetany, pain, heaviness or weakness
in extremities. HP-related hypocalcemia can cause laryngospasm or grand seizures in severe
cases. Over 70% of patients report cognitive disorders including brain fog/mental lethargy,
sleep disturbance and memory loss. Around 60% patients experienced anxiety and depression.
Other emotional symptoms include emotional sensitiveness, hyperirritability, feeling
misunderstood and isolated. Due to the absence of approved PTH replacement therapy for the
treatment of HP in China, according to Frost & Sullivan, it is currently unfeasible to determine
the market share and market size for HP as there have been no corresponding sales generated
in China. The prevalence of HP in China was 410.1 thousand in 2023 and is estimated to reach
495.6 thousand in 2030, representing a significant market.
Current Treatments
Since HP is caused by surgery or genetics, normally there is no prevention method
available. Treatment of HP is aimed at correcting hypocalcemia and hyperphosphatemia,
reducing symptoms, and preventing chronic complications resulting from the disease or its
treatment. Due to the limitations of currently available treatment options, the generally
accepted target serum calcium concentration for HP patients is in the lower end of the normal
range. According to the Chinese HP guideline, HP was the last remaining classic endocrine
deficiency disease for which the missing hormone was not an approved therapy. Current
treatments generally fall into two categories: conventional therapy and PTH therapy.
 Conventional therapy. Conventional therapy consists of calcium in combination
with active vitamin D and sometimes other supplements. While conventional
therapy can increase serum calcium level, it is hard to restore the serum calcium
level to the normal range. Additionally, conventional therapy often requires the use
of very high doses of calcium and active vitamin D, which cause serum calcium
fluctuation, high urine calcium and high serum phosphate, potentially putting HP
patients at risk for many complications such as impaired renal function and
extraskeletal calcifications. Some individuals remain symptomatic or fail to meet
treatment goals even after conventional therapy, with some requiring multiple
hospitalizations for hypocalcemia or HP complications.
 PTH therapy. PTH therapy, as a feasible alternative to conventional treatment, has
been shown to maintain normocalcemia with reduced need for concurrent treatment
with the therapeutic dosage of calcium and active vitamin D analogs. To date,
once-daily Natpara (PTH (1-84)) is the first PTH therapy that has been approved in
the United States and the European Union, although merely indicated as an adjunct
to calcium and vitamin D to control hypocalcemia in patients with HP . Natpara (PTH
(1-84)) received marketing approval from the FDA in 2015 and a conditional
marketing authorization from the EMA in 2017, respectively, but was later recalled
from the United States market in 2019. In October 2022, it was announced that the
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manufacturing of Natpara globally will end at the end of 2024. Because Natpara
(PTH (1-84)) was approved as an adjunct to calcium and vitamin D, it does not
eliminate the inherent risks associated with conventional therapy. In addition, PTH
(1-84) has not been able to show meaningful benefits on clinical episodes of
hypocalcemia or hypercalcemia or effect on 24-hour urine calcium excretion.
Competitive Landscape of the HP Market in China
No PTH replacement therapy has been approved for HP treatment in China.
Palopegteriparatide, licensed to VISEN, is the only PTH replacement therapy that has initiated
clinical development in China. The following chart sets forth the PTH replacement therapy that
is in clinical development in China.
PTH Replacement Therapy with Clinical Activities in China,
as of the Latest Practicable Date
Investigational Drug Drug Structure Company Clinical Status
Palopegteriparatide Prodrug of PTH VISEN (1) Phase 3
(1) VISEN has gained exclusive licensed rights to develop, manufacture and commercialize in China (including
Hong Kong, Macau and Taiwan); Ascendis Pharma retains the rights to develop, manufacture and
commercialize outside of China (including Hong Kong, Macau and Taiwan).
Source: CDE, Frost & Sullivan Analysis
Global HP Market Landscape
Outside of China, Natpara (PTH (1-84)) (developed by NPS Pharmaceuticals, which was
later acquired by Takeda Pharmaceutical Company (“Takeda”) in 2019) received marketing
approval from the FDA in 2015 for once-daily subcutaneous injection as an adjunct to calcium
and vitamin D to control HP . Additionally, as of the Latest Practicable Date, Eneboparatide
(developed by Amolyt Pharma) and CLTX-305 (developed by Calcilytix Therapeutics) are
being developed in Phase 3 global clinical trials; EB612 (developed by Entera Bio), MBX 2109
(developed by MBX Biosciences) and AMOR-1 (developed by Amorphical) are being
developed in Phase 2 global clinical trials; and EXT608 (developed by Extend Biosciences) is
being developed in Phase 1 global clinical trials. None of these drug candidates have
undergone clinical trials in China.
Natpara (PTH (1-84)) is the first available PTH therapy, but is unable to achieve the
physiological level and activities of PTH due to its short half-life, and therefore does not have
an ideal PK profile. Natpara (PTH (1-84)) has not demonstrated the ability to reduce incidences
of hypercalcemia (elevated serum calcium levels), hypocalcemia (low serum calcium) or
hypercalciuria (elevated urinary calcium) relative to conventional therapy in treated patients.
In September 2019, Natpara (PTH (1-84)) was recalled from the United States market due to
the potential for rubber particulate formation. To address this potential issue, Takeda submitted
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a prior approval supplement to the FDA for Natpara (PTH (1-84)) in 2021, which the FDA did
not approve pursuant to its complete response letter issued in March 2022. In October 2022,
Takeda announced that it will discontinue manufacturing Natpara globally at the end of 2024
due to unresolved supply issues that are specific to the product, and will not re-commercialize
Natpara in the United States.
Unlike Natpara (PTH (1-84)), palopegteriparatide is designed as a once-daily PTH
replacement therapy with a long half-life to address the fundamental cause of HP by restoring
physiological and stable levels of PTH 24 hours throughout the day. PK data from MAD
cohorts in Ascendis Pharma’s Phase 1 clinical trial of palopegteriparatide in healthy subjects
demonstrated a half-life of approximately 60 hours, supporting an infusion-like profile of free
PTH. This substantial half-life extension of PTH would reflect more closely the physiological
levels of PTH observed in healthy individuals, maintain normal blood calcium levels,
normalize urinary calcium excretion, reduce clinical hypercalcemia, reduce clinical
hypocalcemia, normalize serum phosphate and normalize bone turnover. This infusion-like PK
profile of palopegteriparatide translates into a predictable serum calcium response, suggesting
the ability to titrate patients with HP into the normal calcemic range. See “Business – Our Drug
Pipeline – Palopegteriparatide – A PTH Replacement Therapy Addressing the Underlying
Cause of HP” for more details. By providing steady levels of PTH in the physiological range,
palopegteriparatide has the potential to address the fundamental limitations of short-acting
PTH molecules, such as PTH (1-84) and PTH (1-34) and become a highly differentiated
therapy for HP . Palopegteriparatide was approved by the EMA and the FDA in November 2023
and August 2024, respectively, for the treatment of adult patients with chronic HP and was
commercially launched in certain European countries in January 2024.
The table below sets forth a comparison between palopegteriparatide and Natpara (PTH
(1-84)). Compared to Natpara (PTH (1-84)), palopegteriparatide shows more promising
clinical results, with longer half-life and better efficacy.
Palopegteriparatide Natpara (PTH (1-84))
Formulation  Prodrug of unmodified
PTH (1-34)
 Restore physiological and
stable levels of PTH 24
hours throughout the day
PTH (1-84)
Clinical Development
Status
 Phase 3 in China
 Approved by FDA and
EMA
 Approved by FDA and
EMA; approval
subsequently recalled in
the United States
 No clinical activities in
China
Half-life 60 hours 3 hours
Administration Daily injection Daily injection
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Palopegteriparatide Natpara (PTH (1-84))
Estimated Average
Annual Treatment
Costs Per Patient
N/A N/A
Efficacy  91% patients stopped
Vitamin D and reduced
calcium to /H11349500 mg/day
 76% patients stopped
Vitamin D and calcium
supplementation entirely
 QoL*: SF-36 improved
from baseline*
 PCS*: 44 to 51
 MCS*: 44 to 52
 43% patients stopped
Vitamin D and reduced
calcium to /H11349500 mg/day
 QoL: SF-36 improved
from baseline*
 PCS: 47 to 49
 MCS: 50 to 52
Indications Under development for the
treatment of HP
An adjunct to calcium and
vitamin D to control
hypocalcemia in patients
with HP
Notes:
* QoL = Quality of Life, SF-36 = 36-Item Short-Form Health Survey, PCS = Physical Component Summary,
MCS = Mental Component Summary
Source: Literature review, FDA, EMA, Frost & Sullivan
Key Drivers of the HP Therapeutic Market in China
 Emerging new therapies for HP . The currently available therapies have various
limitations as discussed above, including risk for complications, and limited ability to
reduce incidences of hypercalcemia, hypocalcemia or hypercalciuria. As an emerging
therapy for HP , palopegteriparatide, on the other hand, can address the fundamental cause
of HP by restoring physiological and stable levels of PTH 24 hours throughout the day,
and thereby maintain normal blood calcium levels, normalize urinary calcium excretion,
reduce clinical hypercalcemia, reduce clinical hypocalcemia, normalize serum phosphate
and normalize bone turnover. Emerging new therapies such as palopegteriparatide, once
available in the market, are expected to boost the market growth by significant therapeutic
desire increase from patients.
 Increasing patient pool and disease awareness. The improvement of early screening and
diagnosis of thyroid cancer will contribute to an increasing patient pool for thyroid cancer
and thyroidectomy cases, which will cause more HP consequently. Moreover, increasing
education among doctors and patients is expected to improve their rate of awareness and
treatment rate, which will further support the growth of the HP therapeutic market in
China.
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 Favorable policies. The PRC government has been dedicated to increasing the
accessibility and affordability of healthcare services by expanding medical insurance
coverage. We expect to see more novel drugs be added to the NRDL, which is expected
to drive the adoption rates of these new drugs and ultimately the HP therapeutic market
in China. In September 2023, genetic HP has been included to the second China Rare
Disease List issued by the National Health Commission, highlighting the favorable
policies and the commission’s commitment to improving disease treatment and increasing
medicine accessibility for HP .
Entry Barriers for the HP Therapeutic Market in China
Despite the market potential and opportunities in the HP therapeutic market, the barriers
to entry remain high, primarily due to a combination of factors as highlighted below:
 Technical and requisite R&D capability barriers to enter into the HP therapeutic market
remain high. Most patients with HP who are having conventional therapy will need to take
calcium and vitamin D supplements for life, which lack efficacy and fail to restore normal
parathyroid hormone physiology. PTH therapy, on the other hand, calls for strong R&D
capability to overcome the inherent risks associated with conventional therapy, such as
serum calcium fluctuation, high urine calcium and high serum phosphate. Further, the
lack of patient data support for the pathogenesis, diagnosis and treatment methods of HP
due to the limited number of cases and dispersed patients has created high scientific
research barriers for drug research and development.
 Marketing of HP drugs requires substantial efforts. Providing sufficient physician and
patient education is important for launching new drugs into the market, especially for
drugs for the treatment of rare disease such as HP , due to the relatively limited number
of patients and dispersed distribution. Therefore, substantial efforts are needed for
commercializing the HP drugs.
 HP drug development is capital intensive with substantial R&D costs. Developing drugs
for the treatment of rare diseases, such as HP , entails substantial R&D costs, including
preclinical studies, clinical trials, regulatory submissions and post-marketing
surveillance.
SOURCE OF INFORMATION
We commissioned Frost & Sullivan to conduct an analysis of and to prepare a report on
global and China endocrine drug markets. We agreed to pay Frost & Sullivan a total fee of
US$165,462. Except as otherwise noted, all of the data and forecasts contained in this section
are derived from the Frost & Sullivan Report. Frost & Sullivan is an independent global market
research and consulting company which was founded in 1961 and is based in the United States.
Services provided by Frost & Sullivan include market assessments, competitive benchmarking,
and strategic and market planning for a variety of industries.
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The Frost & Sullivan Report was compiled based on the following assumptions: (i) the
social, economic and political environments of the PRC will remain stable during the forecast
period, which will ensure a sustainable and steady development of the PRC healthcare
industry; (ii) the PRC healthcare market will grow as expected due to rising healthcare demand
and supply; and (iii) the PRC government will continue to support healthcare reform.
In compiling and preparing the Frost & Sullivan Report, Frost & Sullivan used the
following key methodologies to collect multiple sources, validate the data and information
collected, and cross-check each respondent’s information and views against those of others: (i)
secondary research, which involved reviewing published sources including national statistics,
annual reports of listed companies, industry reports and data based on Frost & Sullivan’s own
research database; and (ii) primary research, which involved in-depth interviews with the
industry participants.
Frost & Sullivan’s projections are made based on various market determinants and their
coefficients assigned to a market which indicate their relative importance. The market
determinants represent both subjective assumptions and objective factors, therefore, the
projected data may not be consistent with the real data.
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We are subject to a variety of PRC laws, rules and regulations affecting many aspects of
our business. This section sets out a summary of the major relevant laws, regulations, rules and
policies which may have material impact on our business and operations.
REGULATIONS ON COMPANY ESTABLISHMENT AND FOREIGN INVESTMENT IN
THE PRC
The establishment, operation and management of corporate entities in China are governed
by the Company Law of the PRC () (the “PRC Company Law”),
which was promulgated by the Standing Committee of the NPC in December 1993 and further
amended in December 1999, August 2004, October 2005, December 2013, October 2018 and
December 2023, respectively. According to the PRC Company Law, companies are generally
classified into two categories: limited liability companies and companies limited by shares.
The PRC Company Law also applies to foreign-invested limited liability companies and
foreign-invested companies limited by shares. According to the PRC Company Law, where
laws on foreign investment have other stipulations, such stipulations shall prevail.
Currently investment activities in the PRC by foreign investors are primarily governed by
the Special Administrative Measures for the Access of Foreign Investment (Negative List)
(Edition 2021) (݄(૶ఊ)(2021و)) and Special
Administrative Measures (Negative List) for the Access of Foreign Investment in Pilot Free
Trade Zones (Edition 2021) (݄(૶ఊ)(2021 ϋ
و)) (collectively, the “Negative Lists”), which were promulgated by the MOFCOM and
National Development and Reform Commission (the “NDRC”) in December 2021 and came
into effect since January 1, 2022. The Negative Lists set out the special administrative
measures in a unified manner in respect of the access of foreign investments, such as the
industries that are prohibited for foreign investment, the limits on shareholding percentages of
foreign investors and the requirements on the participation of foreign investors in the operation
and management. The Negative Lists cover 11 industries, and any field not falling in the
Negative Lists shall be administered under the principle of equal treatment for domestic and
foreign investment. Our business as currently conducted does not fall within the confines of the
Negative Lists and is not subject to foreign investment restrictions.
Foreign Investment Law of the PRC () (the “Foreign
Investment Law”) was promulgated by the NPC in March 2019 and came into effect in January
2020. After the Foreign Investment Law came into effect, the trio of Law on Wholly
Foreign-owned Enterprises of the PRC (), the Law on Sino-
foreign Equity Joint V entures of the PRC () and the
Law on Sino-foreign Cooperative Joint V entures of the PRC ( ʕശɛ͏΍ձ਷ʕ̮ΥЪ຾ᐄ
) have been repealed simultaneously. The investment activities of foreign natural
persons, enterprises or other organizations (hereinafter referred to as “foreign investors”)
directly or indirectly within the territory of China shall comply with and be governed by the
Foreign Investment Law, including: 1) foreign investors establishing foreign-invested
enterprises in China alone or jointly with other investors; 2) foreign investors acquiring shares,
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equity, property shares, or other similar interests of Chinese domestic enterprises; 3) foreign
investors investing in new projects in China alone or jointly with other investors; and 4) other
forms of investment prescribed by laws, administrative regulations or the State Council.
In December 2019, the State Council promulgated the Regulations on Implementing the
Foreign Investment Law of the PRC (ૢԷ) (the
“Implementation Rules”), which came into effect in January 2020. The Implementation Rules
further clarified that the state shall encourage and promote foreign investment, protect the
lawful rights and interests in foreign investments, regulate foreign investment administration,
continues to optimize foreign investment environment, and advances a higher-level opening.
In December 2019, the MOFCOM and the SAMR promulgated the Measures on
Reporting of Foreign Investment Information () (the “Reporting
Measures”), which came into effect in January 2020. After the Reporting Measures came into
effect, the Interim Measures for the Administration of Filing for Establishment and Changes in
Foreign Investment Enterprises () has been
repealed simultaneously. Since January 1, 2020, foreign investors or foreign-invested
enterprises carrying out investment activities directly or indirectly in China shall submit
investment information to the relevant commerce administrative authorities according to the
Reporting Measures.
REGULATIONS ON PHARMACEUTICAL PRODUCT DEVELOPMENT, APPROV AL
AND REGISTRATION IN THE PRC
Drug Regulatory Regime
The Drug Administration Law of the PRC () (the “Drug
Administration Law”) was promulgated by the Standing Committee of the NPC in September
1984. The latest amendment to the Drug Administration Law was promulgated in August 2019
and took effect in December 2019. The Regulations for the Implementation of the Drug
Administration Law of the PRC (ૢԷ) (the “Regulations
for the Implementation of the Drug Administration Law”) was promulgated by the State
Council in August 2002, and was last amended and took effect in March 2019. The Drug
Administration Law and the Regulations for the Implementation of the Drug Administration
Law have laid down the current legal framework for drug development, production,
distribution, use, supervision and management within the territory of China. The Drug
Administration Law also regulates the packaging, pricing and advertisements of
pharmaceutical products in the PRC. On May 9, 2022, the National Medical Products
Administration issued the Implementation Regulations of the Drug Administration Law of the
PRC (Revised Draft for Comments) (ૢԷ(ᅄӋจ
Ԉᇃ)), which made proposed changes in R&D, production, sales, supervision and
management of drugs, and the proposed changes related to us mainly relates to our drug sales
operation.
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The Law of the PRC on the Promotion of Basic Medical Care, Hygiene and Health ( ʕ
) was promulgated by the Standing Committee of
the NPC in December 2019 and took effect in June 2020. This law aims at developing medical
care, hygiene and health undertakings, ensuring citizens’ access to basic medical and health
services and raising the health level of citizens. Citizens shall have the right to obtain basic
medical and health services from the State and the society pursuant to the law. The State shall
establish basic medical and health care system and set up a sound medical and health service
system to protect and realize citizens’ right to obtain basic medical and health services.
In June 2021, the National Healthcare Security Administration (the “NHSA”)
promulgated the Healthcare Security Law (Draft for Comments) (ج(ᅄӋจԈ
ᇃ)) for public comments. The law aims to regulate the networks of healthcare security, form
a high-quality, multi-level healthcare security system, protect citizens’ lawful rights to
healthcare security and promote the benign development of healthcare security.
Regulatory Authorities
In the PRC, pharmaceutical products, medical devices and equipment are monitored and
supervised on a national scale by the NMPA. The local provincial medical products
administrative authorities are responsible for supervision and administration of drugs within
their respective administrative regions. The NMPA was newly formed under the SAMR. The
NMPA ’s predecessor, the State Drug Administration, the SDA, was replaced by the State Food
and Drug Administration, the SFDA, which was later reorganized into the China Food and
Drug Administration, the CFDA, as part of the institutional reforms implemented by the State
Council. The CDE, which is subordinate to the NMPA, conducts the technical evaluation of
each drug and biologic application to assess safety and efficacy.
In 2013, the Ministry of Health (the “MOH”) and the National Population and Family
Planning Commission were integrated into the National Health and Family Planning
Commission of the PRC (the “NHFPC”). In March 2018, the First Session of the Thirteenth
NPC approved the State Council Institutional Reform Proposal (),
according to which, the responsibilities of NHFPC and certain other Governmental Authorities
are consolidated into the National Health Commission (the “NHC”), and the NHFPC shall no
longer be reserved. The responsibilities of the NHC include public hospital administration,
prevention and control of chronic diseases and pandemics, promotion of maternal and children
health and health of senior citizens as well as the drug use policies including organizing the
formulation of national drug policies, the national essential drug system and the National
Essential Drug List and drafting the administrative rules for the procurement, distribution and
use of national essential drugs. According to the State Council Institutional Reform Proposal,
the NHSA was finally established as a new organization directly under the State Council to
integrate those functions and duties formerly assumed by the Ministry of Human Resources and
Social Security of the PRC (the “MHRSS”) in terms of basic medical insurance systems and
maternity insurance systems covering urban employees and urban residents, by the NHFPC in
terms of the new rural cooperative healthcare system, by the NDRC in terms of drug and
medical service price management, and by the Ministry of Civil Affairs in terms of medical
aids.
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Regulations on the Clinical Trials and Registration of Drugs
Administrative Measures for Drug Registration
The Administrative Measures for Drug Registration () (the
“Registration Measures”) were promulgated by the SAMR in January 2020 and took effect in
July 2020, which replaced the previous Registration Measures promulgated by the SFDA in
July 2007. Pursuant to the Registration Measures, drug marketing registration applications
shall be subject to three categories, namely traditional Chinese drugs, chemical drugs and
biological products. Among them, the registration applications of biological products shall be
categorized by innovative biological products, new modified biological products, already-
marketed biological products (including biological similar drugs), etc. If all the regulatory
requirements are satisfied, a Drug Registration Certificate with a validity period of five years
will be issued by the NMPA. After obtaining the Drug Registration Certificate, the applicant
shall be the marketing authorization holder (the “MAH”). The MAH shall continually ensure
the safety, efficacy and quality controllability of the drug marketed and shall apply for drug
re-registration six months prior to the expiry date of the Drug Registration Certificate.
Accelerated Approval for Clinical Trial and Registration
The CFDA released the Circular concerning Several Policies on Drug Registration
Review and Approval (ʮѓ) in November 2015, which
clarified the measures and policies regarding, among others simplifying and accelerating the
approval process of clinical trials, including but not limited to the adoption of a one-time
umbrella approval procedure allowing the overall approval of all phases of a new drug’s
clinical trials, replacing the phase-by-phase application and approval procedure.
The General Office of the State Council and the Central Committee of the Communist
Party of China jointly issued the Opinions on Deepening the Reform of the Evaluation and
Approval Systems and Encouraging Innovation on Drugs and Medical Devices (ଉʷᄲ
จԈ) (the “Innovation Opinions”) in October
2017. The Innovation Opinions established a framework for reforming the evaluation and
approval system for drugs, medical devices and equipment. The Working Procedures for the
Evaluation of Breakthrough Therapy Designation Drugs (for Trial Implementation) (׌
ᄲ൙ʈЪ೻ҏ(༊Б)), the Working Procedures for the Review and Approval of
Conditioned Marketing of Drugs (for Trial Implementation) (ɪ̹͡ሗᄲ൙
ᄲҭʈЪ೻ҏ(༊Б)) and the Working Procedures for the Prioritized Review and Approval
of Drug Marketing Authorization (for Trial Implementation) (ɪ̹஢̙Ꮄ΋ᄲ൙ᄲҭʈ
Ъ೻ҏ(༊Б)), promulgated by the NMPA and came into effect on July 7, 2020 further
clarified the availability and applicability of fast track registration procedures for innovative
drugs.
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According to the Announcement on Matters concerning the Optimization of Drug
Registration Review and Approval (ʮѓ) jointly
issued by the NMPA and the NHC in May 2018, the CDE will prioritize the allocation of
resources for review, inspection, examination and approval of registration applications that
have been included in the scope of priority evaluation and approval.
Pursuant to the Administrative Measures for Communication of Drug R&D and Technical
Review () (the “Communication Measures”)
issued by the CDE on December 10, 2020, which came effective on the same day, during the
research and development, and application for registration stages of innovative drugs, the
applicants may propose communication sessions with the CDE regarding key technical issues
which are not addressed in drug development and evaluation guidelines. The forms of such
communication sessions include face-to-face conference, video conference, telephone
conference or written reply. In general, such communication sessions are classified into three
types, namely, Class I, Class II and Class III, among which, Class I sessions are convened to
discuss the key safety issues in the clinical trials of drugs and in the research and development
of breakthrough therapeutic drugs, or other situations deemed applicable. Prior to applying for
marketing approval for prophylactic or therapeutic biological products, in principle the
applicant shall submit a request for communication sessions with the CDE. Further, the CDE
issued the Guidelines of Application for and Management of Class I Session for
Communication on Children’s Drugs (for Trial Implementation) (the “Guidelines of Class I
Session for Children’s Drugs”) on April 18, 2023, which was promulgated for the purpose of
refining the application and management process for communication and exchange of
children’s medicines in accordance with the Communication Measures. According to the
Guidelines of Class I Session for Children’s Drugs, application of registration or innovative
drugs will be deemed as “other scenarios deemed applicable” for which a Class I session can
be applied under the Communication Measures provided that such innovative drugs have been
marketed abroad and have obtained pediatric use licenses, and have important value for
meeting the clinical treatment needs of children in China. In particular, such scenario can be
further classified into: the innovative drug has not been approved for marketing in China and
the applicant is applying for marketing registration in China; the innovative drug has been
marketed in China and has obtained an adult use license or a pediatric use license for some age
groups, and the applicant is applying to increase the child use population; the innovative drug
has been marketed in China and has obtained a pediatric use license or an adult use license for
certain indications, and the applicant is applying to increase the indications for children. The
Guidelines of Class I Session for Children’s Drugs also specify a clear pathway for applicant
to submit the application of Class I sessions for children’s drugs to CDE, which include: (i)
after receiving a request for a Class I session, the project manager of the CDE will review the
“session purpose” prepared by the applicant; (ii) if the request for Class I Session meets the
requirements specified thereunder, it will be forwarded to the relevant professional review
team; and (iii) the clinical professional review team is responsible for reviewing the application
material for Class I session and confirming whether to proceed with a Class I session. If the
request for a Class I session meets the requirements but has significant deficiencies in the
application materials (such as unclear pediatric clinical trial plans, obviously unreasonable trial
design, or failure in submitting explanation for applying for Class I session), the application
request will be rejected.
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According to the Announcement on the Issuance of the “Administrative Measures for
Post-Marketing Changes of Drugs (Trial)” (2021 No. 8) (೯̺<ܝ
ج(༊Б)>ʮѓ(2021 ϋୋ8໮)), the NMPA shall prioritize the evaluation and
approval process for marketing registration applications of overseas-original chemical
pharmaceuticals and biological products that have obtained marketing approval for shifting to
domestic manufacture.
Acceptance of Foreign Clinical Trial Data
On July 6, 2018, the NMPA issued the Guiding Technical Principles on Accepting Foreign
Drug Clinical Trial Data () (the “Guiding
Technical Principles”) as one of the implementing rules for the Innovation Opinions, which
provides that overseas clinical data can be submitted for the drug registrations in China.
According to the Guiding Technical Principles, applicants may use the data of overseas clinical
trials to support drug registration in China, provided that applicants must ensure the
authenticity, completeness, accuracy and traceability of overseas clinical trial data and such
data must be obtained consistent with the relevant requirements under the Good Clinical Trial
Practice (GCP) of the International Conference on Harmonization of Technical Requirements
for Registration of Pharmaceuticals for Human Use. Sponsors must also comply with other
relevant sections of the Registration Measures when applying for drug registrations in China
using overseas clinical trial data.
Approval Authority and Process for Clinical Trial Applications
According to the Registration Measures, upon the completion of the pharmaceutical,
pharmacological and toxicological research, etc., which support the drug clinical trial, the
applicant may submit relevant research materials for drug clinical trial application to CDE
according to relevant requirements. The CDE shall organize pharmaceutical, medical and other
technicians to review the accepted application and to decide whether to approve the drug
clinical trial within 60 days of the date of acceptance of the application. The result will be
notified to the applicant through the website of the CDE and if no notice of decision is issued
within the aforementioned time limit, the application of clinical trial shall be deemed as
approved and the applicant may carry out the drug clinical trial according to the submitted
clinical trial plan. The Registration Measures further require that the sponsor, i.e., the applicant
carrying out the drug clinical trial with approval, shall, prior to conducting the drug clinical
trial, register the relevant information of the drug clinical trial plan on the Drug Clinical Trial
Registration and Information Publicity Platform. During the drug clinical trials, the applicant
shall update registration information continuously, and register information of the outcome of
the drug clinical trial upon completion. The applicant shall be responsible for the authenticity
of the drug clinical trial information registered on the platform. Pursuant to the Notice on the
Drug Clinical Trial Information Platform (ʮѓ)
promulgated by the SFDA in September 2013, the applicant shall complete the trial
pre-registration within one month after obtaining the approval of the clinical trial application
in order to obtain the trial’s unique registration number, and complete the registration of certain
follow-up information before the first subject’s enrollment in the trial and submit for first-time
publication. If the submission for first-time publication is not completed within one year after
the approval, the applicant shall submit an explanation, and if the submission for first-time
publication is not completed within three years after the approval, the approval of the clinical
trial application shall automatically expire.
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Compliance with GCP and Drug Clinical Institutions
The conduct of clinical trials for the purpose of application for drug registration must
adhere to the Good Clinical Trial Practice for Drugs (ᑗґ༊᜕ሯඎ၍ଣ஝ᇍ)
(the “GCP Rules”), which was promulgated by the SFDA in August 2003 and further amended
by the NMPA and NHC in April 2020 and came into effect in July 2020. According to the GCP
Rules, clinical trial means a systematic investigation of drugs conducted on humans (patients
or healthy subjects) to reveal or validate, clinically, the medical, pharmacological and other
pharmacodynamic effects, adverse reactions, or absorption, distribution, metabolism and
excretion of a trial drug, so as to determine its efficacy and safety. In order to ensure the quality
of clinical trials and the safety of human subjects, the GCP Rules provides comprehensive and
substantive requirements on the design and conduct of clinical trials in China. In particular, the
GCP Rules enhances the protection for study subjects and tightens the control over bio-samples
collected under clinical trials.
The GCP Rules stipulated that the sponsor shall bear the cost of diagnosis, medical
treatment and the corresponding compensation for any human subject who is harmed or dies
due to reasons related to the clinical trial. The sponsor and investigator shall pay the human
subject the compensation or indemnification in a timely manner. However, the GCP Rules
promulgated in 2020 abolished the compulsory insurance that the sponsor shall provide to
human subjects participating in a clinical trial as previously prescribed in the GCP Rules
promulgated in 2003.
The GCP Rules also set out the qualifications and requirements for the investigators and
drug clinical trial institutions, including: (i) possessing the qualification to practice in a drug
clinical trial institution, possessing the professional knowledge, training experience and
capability required for a clinical trial, and being able to provide the latest resume and relevant
qualification documents as requested by the sponsor, ethics committee and competent medical
products administration; (ii) being familiar with the trial protocol, investigator’s brochure and
relevant information of the trial drug provided by the sponsor; (iii) being familiar and in
compliance with the GCP Rules and relevant laws and regulations relating to clinical trials; (iv)
keeping a copy of the authorization form on responsibility allocation signed by investigators;
(v) investigators and drug clinical trial institutions shall accept supervision and inspection
organized by the sponsor and inspection by the drug regulatory authorities; and (vi) in the case
of investigators and drug clinical trial institutions authorizing other individual or institution to
undertake certain responsibilities and functions relating to clinical trial, ensuring such
individual or institution are qualified and establishing complete procedures to ensure the
responsibilities and functions are fully performed and reliable data can be generated.
The GCP Rules also stipulate the responsibilities of ethics committee in clinical trial
process. An ethics committee shall consist of experts working in the medical, pharmaceutical
and other fields in accordance with the requirements of the competent health department. The
clinical trial protocol may not be executed unless approved by the ethics committee. In
November 2019, the NMPA and the NHC jointly promulgated the Notice on Issuing the
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Administration Rules of Drug Clinical Trial Institution (ᑗґ༊᜕ዚ࿴၍ଣ஝
ʮѓ) (the “Clinical Trial Institution Notice”), which stipulates that each drug clinical
trial institution shall maintain an ethics committee responsible for the ethical review of drug
clinical trial.
According to the Clinical Trial Institution Notice, drug clinical trial institutions refer to
institutions eligible to undertake the drug clinical trials and shall have been duly recorded with
the online platform designated by the NMPA. These rules have specified the requirements for
drug clinical trial institutions and require that a clinical trial institution should evaluate or
engage a third party to evaluate whether it has met such requirements before applying for
recordal. A drug clinical trial applicant should only engage a duly recorded clinical trial
institution to carry out a drug clinical trial and the clinical trial institution engaged must, during
the conduct of clinical trials, comply with the GCP Rules and other technical guidelines for
drug clinical trials.
Drug Marketing Registration
According to the Registration Measures, the applicant may submit an application for drug
marketing registration to CDE upon completion of relevant research on pharmacy,
pharmacology, toxicology and drug clinical trials which support the drug marketing
registration, determination the quality standards of the drug, validation of commercial-scale
production processes and preparation for acceptance of verification and inspection conducted
by professional technical institution designated by competent NMPA. The application shall be
accepted if the application materials are deemed acceptable upon examination in form. The
CDE will organize pharmaceutical, medical and other technicians to conduct comprehensive
review of the safety, efficacy and quality controllability, among others, of the drug based on
the accepted application materials submitted by the applicant, the results of the verification and
inspection conducted by professional technical institution, etc. If the comprehensive review
conclusion is affirmative, the drug shall be approved for marketing and a Drug Registration
Certificate will be issued containing the information of the drug approval number, the MAH,
and the manufacturer.
According to the Registration Measures, overseas manufactured drugs (imported drugs)
and locally manufactured drugs are subject to different registration pathways. Therefore, if a
drug has been registered in the PRC as an overseas manufactured drug and then the
manufacturing is to be moved to a PRC manufacturing site, the drug is required to apply for
a new Drug Registration Certificate as a locally manufactured drug.
The MAH System
According to the Drug Administration Law, the state implements the MAH system. In
accordance with the Drug Administration Law and the Registration Measures, the holder of a
Drug Registration Certificate shall be an MAH. An MAH may manufacture and sell drugs or
engage pharmaceutical manufacturing enterprise to manufacture drugs and/or pharmaceutical
distribution enterprise to sell drugs.
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An MAH shall be responsible for non-clinical research, clinical trials, manufacturing and
business operation, post-marketing research, adverse reaction monitoring and reporting and
handling. An MAH may not engage a pharmaceutical manufacturing enterprise to produce
blood products, narcotic drugs, psychotropic drugs, toxic drugs for medical use, and
pharmaceutical precursor chemical, except as otherwise stipulated by the drug regulatory
department under the State Council.
Where an MAH is an overseas enterprise, its designated domestic enterprise shall perform
the obligations of an MAH and jointly assume the responsibilities of an MAH.
International multi-center clinical trials regulations
On January 30, 2015, the CFDA promulgated the Notice on Issuing the International
Multi-Center Clinical Trial Guidelines (Trial) (یܸ(༊Б))
(the “Multi Regional Clinical Trial Guidelines”), which took effect as of March 1, 2015, aiming
to provide guidance for the regulation of application, implementation and administration of
international multi-center clinical trials in China. Pursuant to the Multi-Center Clinical Trial
Guidelines, international multi-center clinical trial applicants may simultaneously perform
clinical trials in different centers using the same clinical trial protocol. Applicant may make use
of the data derived from the international multi-center clinical trials for application to the
NMPA for approval of a NDA/BLA after satisfying certain requirements under the Multi-
Regional Clinical Trial Guidelines. International multi-center clinical trials shall follow
internationally prevailing GCP principles and ethics requirements.
Data derived from international multi-center clinical trials can be used for the NDAs or
BLAs with the NMPA. When using international multi-center clinical trial data to support
NDAs or BLAs in China, applicants shall submit the completed global clinical trial report,
statistical analysis report and database, along with relevant supporting data in accordance with
ICH-CTD (International Conference on Harmonization-Common Technical Document) content
and format requirements; subgroup research results summary and comparative analysis shall
also be conducted concurrently.
Human Genetic Resources Approval
The Regulation on the Management of Human Genetic Resources ( ɛᗳ፲ෂ༟๕၍ଣ
ૢԷ), promulgated by the State Council on May 28, 2019 and effective on July 1, 2019,
replaces the Interim Administrative Measures on Human Genetic Resources ( ɛᗳ፲ෂ༟๕
) promulgated by the Ministry of Science and Technology and the MOH in
June 1998, and further regulates the collection, preservation, utilization and external provision
of China’s human genetic resources. According to this regulation, “human genetic resource”
includes human genetic resource materials and information. Human genetic resource materials
refer to the genetic materials with respect to organs, tissues, cells and other genetic materials
containing human genome, genes and other genetic substances. Human genetic resource
information refers to information, such as data, generated from the use of human genetic
resources materials. The Administrative Department of Science and Technology under the State
Council is responsible for the management of human genetic resources at the national level,
and the administrative departments of science and technology under the provincial
governments are responsible for the management of human genetic resources at local level and
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are vertically directed by the central government of the PRC. Foreign organizations,
individuals and institutions established or actually controlled by foreign organizations and
individuals are not allowed to collect or preserve human genetic resources (including organs,
tissues, cells and other genetic materials of human genome and gene) in China or provide
human genetic resources abroad. Whoever utilizes China’s human genetic resources for
international cooperation in scientific research shall meet the conditions stipulated in this
regulation, and the two parties shall jointly submit an application to the Administrative
Department of Science and Technology under the State Council for approval. Examination and
approval shall become unnecessary for international cooperation in clinical tests on the basis
of China’s human genetic resources in the clinical institution in order to obtain the marketing
authorization in China with respect to relevant drugs and medical instruments, which will not
involve the provision of materials of human genetic resources abroad. However, the two parties
shall, prior to clinical tests, submit the categories, quantities and purposes of the human genetic
resources to be utilized to the Administrative Department of Science and Technology under the
State Council for filing. The Administrative Department of Science and Technology under the
State Council and the Administrative Department of Science and Technology under the
people’s governments of the provinces, autonomous regions and municipalities directly under
the Central Government shall strengthen the supervision of filing. The two parties may utilize
the information of human genetic resources generated from international cooperation in
scientific research on the basis of China’s human genetic resources. On March 16, 2023, the
State Council released the State Council Notice on Establishment of the Institutions ( ਷ਕ
) (the “SC Notice”), which was promulgated based on the adopted
Party and the State Council Institutional Reform Plan 2023 (ࣩ
2023) ) (the “Reform Plan”) and become effective on the same date. According to the SC
Notice and the Reform Plan, China National Center for Biotechnology Development (together
with its subdivision the China Human Genetic Resources Administration Office), which is
affiliated to the Ministry of Science and Technology, is expected to be an affiliated body of the
NHC.
On March 21, 2022, the Ministry of Science and Technology issued the Implementing
Rules of the Administrative Regulations on Human Genetic Resources (for Public Comments)
(ۆ(ᅄӋจԈᇃ)) (the “Human Genetic Resources
Implementing Rules”) for public comments, which provided specific provisions on the
collection, preservation, utilization and external provision of human genetic resources of the
PRC.
On May 26, 2023, the Ministry of Science and Technology promulgated the
Implementation Rules for the Administrative Regulation on Human Genetic Resources ( ɛ
), or the Implementation Rules for HGR, which has come into
effect on July 1, 2023. The Implementation Rules for HGR further provide detailed
implementation regulations for the Administration of Human Genetic Resources of the PRC,
such as:
 Clarifying the scope of human genetic resource information, which shall include
information resources generated from human genetic resource materials (such as
human genes and genome data) and exclude clinical data, image data, protein data
and metabolic data;
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 Further clarifying the criteria to constitute a Foreign Entity, which shall include (i)
any foreign organization or individual that holds directly or indirectly more than
50% of the shares, equity interests, voting rights, property shares or other interests
in the institution, (ii) any foreign organization or individual that is able to dominate
or have material effect on the decision-making or management of the institution
through its voting right or other interests, although the shares, equity interests,
voting rights, property share or other interests it directly or indirectly holds in the
institution is less than 50%, (iii) any foreign organization or individual that is able
to dominate or have material effect on the decision-making or management of the
institution through investment relationship, contract or other arrangement; and (iv)
other situations stipulated by laws, regulations and rules;
 Specifically listing the situations where security review may be required, which
shall include: (i) human genetic resource information of important genetic families;
(ii) human genetic resources information of specific regions, (iii) exome sequencing
and genome sequencing information resources with a population greater than 500
cases; and (iv) other situation that may affect the public health, national security and
social public interest of China; and
 Further improving the clarity and efficiency of the administration of human genetic
resources, for example, clarifying the method for the calculation of illegal gains and
providing detailed exemptions on certain matters that are subject to approval.
On October 17, 2020, the Standing Committee of the NPC adopted the Biosecurity Law
of the PRC ( ) (the “Biosecurity Law”), which has become
effective on April 15, 2021. The Biosecurity Law establishes an integrated system to regulate
biosecurity related activities in China, including the security regulation of human genetic
resources and biological resources. The Biosecurity Law for the first time expressly declares
that China has sovereignty over its human genetic resources, and further endorsed the
Regulation on the Management of Human Genetic Resources by recognizing the fundamental
regulatory principles and systems established by it over the utilization of Chinese human
genetic resources by foreign entities in China. Although the Biosecurity Law does not provide
any specific new regulatory requirements for human genetic resources, because it is a law
adopted by China’s highest legislative authority, it gives China’s major regulatory authority of
human genetic resources, the NHC, significantly more power and discretion to regulate human
genetic resources, and it is expected that the overall regulatory landscape of Chinese human
genetic resources will evolve and become even more rigorous and sophisticated. Failure to
comply with the requirement under the Biosecurity Law will result in penalties, including
fines, suspension of related activities and confiscation of related human genetic resources and
gains generated from conducting these activities.
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Regulations on Drug Manufacturing
According to the Drug Administration Law and the Regulations for the Implementation
of the Drug Administration Law, a drug manufacturing enterprise is required to obtain a Drug
Manufacturing Permit from the relevant provincial drug administration authority of the PRC.
The grant of such permit is subject to an inspection of the manufacturing facilities, and an
inspection to determine whether the sanitary condition, quality assurance systems, management
structure and equipment meet the required standards. According to the Measures on the
Supervision and Administration of the Manufacture of Drugs ()
(the “Drug Manufacturing Measures”), last amended on January 22, 2020 and came into effect
on July 1, 2020, the Drug Manufacturing Permit is valid for five years and shall be renewed
at least six months prior to its expiration date upon a re-examination by the original issuing
authority. In addition, the name, unified social credit code, registered address (business
premises) and legal representative specified in the drug manufacturing permit shall be the same
as that set forth in the business license as approved and issued by the local counterparts of the
SAMR. According to the Drug Manufacturing Measures, if the MAH does not manufacture the
drug but entrusts others to manufacture the drug, the MAH shall enter into an entrustment
agreement and a quality agreement with a qualified drug producer and submit the relevant
agreements and the application materials of the actual production site to the competent
provincial counterpart of the NMPA where the MAH is located to apply for the Drug
Manufacturing Permit.
The Good Manufacturing Practice for Drugs (͛ପሯඎ၍ଣ஝ᇍ) (the “GMP
Rules”) was last amended on January 17, 2011 and came into effect on March 1, 2011. The
GMP Rules comprise a set of detailed standard guidelines governing the manufacture of drugs,
including institution and staff qualifications, production premises and facilities, equipment,
hygiene conditions, production management, quality controls, product operation, raw material
management, maintenance of sales records and management of customer complaints and AE
reports. Under the Drug Manufacturing Measures, a GMP certification is no longer required for
drug manufacturing enterprises, but drug manufacturing enterprises shall comply with the
GMP Rules in their drug manufacturing activities.
Regulations on Drug Operation
According to the Drug Administration Law, the operation of drug business, including drug
wholesale and drug retail, is prohibited without a Drug Operation Permit. A Drug Operation
Permit shall state the validity period and the scope of business and be subject to review and
reissuance upon expiry of the validity period.
According to the Measures for the Administration of Drug Operation License (຾
), promulgated on February 4, 2004 and amended on November 7, 2017,
a Drug Operation Permit is valid for five years. Each holder of the Drug Operation Permit must
apply for an extension of its permit six months prior to expiration.
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The Good Supply Practice for Pharmaceutical Products (຾ᐄሯඎ၍ଣ஝ᇍ)
(the “GSP Rules”) was last amended and came into effect on July 13, 2016. The GSP Rules set
forth the basic standards in management of operation quality of drugs and apply to enterprises
engaged in drug operations in the PRC, which require drug operators to implement strict
controls on its operation of pharmaceutical products, including standards regarding staff
qualifications, premises, warehouses, inspection equipment and facilities, management and
quality control. Under the Drug Administration Law of the PRC, the GSP certification is no
longer required for drug operators, but drug operators are still required to comply with the GSP
Rules.
Regulation of Medical Devices
Pursuant to the Regulations on the Supervision and Administration of Medical Devices
(ᔼᐕኜ૛္ຖ၍ଣૢԷ) amended by the State Council on February 9, 2021 and came into
effect on June 1, 2021, in the PRC, medical devices have been classified into three categories
based on the degree of risk. Class I medical devices refer to those devices with low risk and
whose safety and effectiveness can be ensured through routine administration. Class II medical
devices refer to those devices with medium risk and whose safety and effectiveness should be
strictly controlled. Class III medical devices refer to those devices with high risk and whose
safety and effectiveness must be strictly controlled with special measures.
REGULATIONS ON COVERAGE AND REIMBURSEMENT IN THE PRC
National Reimbursement Drug List
In 2015, the State Council announced the Outline for the Planning of the National
Medical and Health Service System (2015-2020) (ࠅ2015-2020
ϋ)), which aims to establish a basic medical and healthcare system that covers both rural
and urban citizens by 2020. Participants of the national medical insurance program and their
employers, if any, are required to contribute to the medical insurance fund on a monthly basis.
Program participants are eligible for full or partial reimbursement of the costs of medicines
included in the National Drug Catalogue for Basic Medical Insurance, Work-related Injury
Insurance and Maternity Insurance (ͦ፽)
or the NRDL.
The NHSA has the power to determine which medicines are listed in the NRDL.
Medicines listed in the NRDL are divided into two parts, List A and List B. List A drugs are
widely used clinical treatments with good efficacy and lower prices compared to similar drugs.
Patients purchasing medicines included in List A of the NRDL shall be reimbursed the purchase
price through the medical insurance fund in full. While List B drugs are clinical treatments with
good efficacy and slightly higher prices compared to List A drugs. Patients purchasing
medicines included in List B of the NRDL are required to pay a certain percentage of the
purchase price itself and obtain reimbursement for the remainder of the purchase price through
the medical insurance fund. The NHSA promulgated the Announcement on the Release of the
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Work Plan for the Adjustment of the National Medical Insurance Drug Catalogue in 2019 ( ᗫ
ʮб<2019ࣩ>ʮѓ) on April 17, 2019, stipulating that
the exclusive patent drugs with higher price or greater influence on the medical insurance fund
shall be admitted into the NRDL through negotiation. According to the Notification on the
Inclusion of Drugs under Negotiation in Part B of the Drugs Catalogue for the National Basic
Medical Insurance, Work-related Injury Insurance and Maternity Insurance in 2019 (ਗ਼
2019ॶɝ <ͦ፽ >ஷ
) promulgated by the NHSA and the MOHRSS on November 22, 2019, the negotiation
drugs are an important part of the NRDL and the negotiated drugs shall be paid according to
the relevant provisions of List B drugs during the drug negotiation agreement period. On
June 29, 2023, the NHSA released the Work Plan for the Adjustment to 2023 Catalogue of
Drugs for National Basic Medical Insurance, Work-related Injury Insurance and Maternity
Insurance ( 2023) and
related documents, marking the official start of the latest round of adjustment to the NRDL.
Commercial Insurance
The State Council and the Central Committee of the Communist Party of China jointly
issued the Plan for Healthy China 2030 ( “਄ੰʕ਷2030”) (the “2030 Plan”) in
October 2016, according to which, the country would establish a multi-level medical security
system built around basic medical insurance, with other forms of insurance supplementing the
basic medical insurance, including serious illness insurance for urban and rural residents,
commercial health insurance and medical assistance. Furthermore, the 2030 Plan encourages
enterprises and individuals to participate in commercial health insurance and various forms of
supplementary insurance.
Volume-Based Procurement
Under the current PRC regime, in order to improve the affordability of drugs, ease the
pressure of the medical insurance fund and provide space for the inclusion of innovative drugs,
relevant Governmental Authorities gradually expanded the scope of V olume-Based
Procurement.
In January 2019, the State Council promulgated the Pilot Program for the State-organized
V olume-based Procurement and Usage of Drugs (),
which was introduced into and implemented in eleven pilot cities including Beijing, Tianjin,
Shanghai, Chongqing, Shenyang, Dalian, Xiamen, Guangzhou, Shenzhen, Chengdu and Xi’an
(the “Eleven Cities”). In September 2019, nine national departments and agencies including the
NHSA and the NMPA and other seven departments jointly issued the Implementation Opinions
on Expanding the Regional Scope of the Pilot Program for the State-organized V olume-based
Procurement and Usage of Drugs to Wider Areas (ණʕમᒅձԴ͜༊ᓃᓒ
จԈ), pursuant to which the pilot program has expanded nationwide with
the view of further reducing the medication burden of the masses and intensifying reform and
innovation. In January 2021, the State Council further published the Opinions on Promoting the
Normalization and Institutionalization of V olume-Based Procurement of Drugs ( ਷ਕ৫፬ʮ
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จԈ), pursuant to which the drugs
listed in the National Drug Catalogue for Basic Medical Insurance with large consumption and
high procurement price in particular would be included in the procurement scope and various
drugs on market which are clinically necessary and reliable will be covered gradually.
Furthermore, the drugs that have passed (including those deemed to have passed) the
consistency evaluation of the quality and efficacy of generic drugs shall be included in the
scope of procurement with priority. In general, pursuant to the aforementioned state policies,
the volume-based procurement system have been regularly and widely adopted in the PRC and
the central and local government agencies are responsible for organizing and carrying out
volume-based procurement every year on a regular basis. Under the current volume-based
procurement system, the healthcare institutions shall procure the bid-winning drugs with
priority and the doctors shall prescribe the bid-winning drugs, as applicable. According to the
Executive Meeting of the State Council held on January 10, 2022, the meeting pointed out that
it is necessary to promote the normalization and institutionalization of volume-based
procurement, speed up its expansion, and continuously reduce the price of drugs to benefit
patients. Focused on chronic diseases and common diseases, continue to promote the national
volume-based procurement, and conduct provincial or inter-provincial alliance procurement of
drugs outside the national volume-based procurement. Gradually expand the coverage of
high-value medical consumables in volume-based procurement and carry out national and
provincial volume-based procurement for drugs such as orthopedic consumables, drug
balloons, dental implants of concern to the masses. As of July 2023, relevant Governmental
Authorities have organized eight volume-based procurements, of which the first five
procurements and the seventh procurement were relating to chemical drugs, the sixth
procurement was relating to insulin particularly, and the eighth procurement included the
Heparin.
According to the 14th Five-Y ear Plan on National Healthcare Security ( “ɤ̬ʞ”Ό͏
ღ஝ྌ), the number of categories of the drugs that have been included in the scope
of such system is expected to reach 500 by 2025.
All MAH holders for the drugs falling under the scope of the volume-based procurement
and meet certain requirements in terms of quality standards, production capacity, supply
stability and etc., may be eligible to participate in such procurement. For example, the local
governmental department of Guangdong Province in charge of volume-based procurement
recently announced that 294 drug products in total have been listed for volume-based
procurement in Guangdong and other ten provincial regions, which only included the short
acting dry powder hGH formulation products of four MAH holders. However, the long acting
hGH formulation products have not been included in the scope of volume-based procurement
scope yet, and no enterprise successfully won the bid for the short acting liquid hGH
formulation products.
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REGULATIONS ON INTELLECTUAL PROPERTY RIGHTS IN THE PRC
Patents
Pursuant to the PRC Patent Law (), promulgated by the State
Council on March 12, 1984, and last amended on October 17, 2020 and took effect on June 1,
2021, patents in China fall into three categories: invention patents, utility model patents and
design patents. An invention patent is granted to a new technical solution proposed in respect
of a product or method or an improvement of a product or method. A utility model is granted
to a new technical solution that is practicable for application and proposed in respect of the
shape, structure or a combination of both of a product. A design patent is granted to the new
design of a certain product in shape, pattern or a combination of both and in color, shape and
pattern combinations aesthetically suitable for industrial application. Under the PRC Patent
Law, the term of patent protection starts from the date of application. Patents relating to
invention are effective for twenty years, utility models are effective for ten years, and designs
are effective for fifteen years from the date of application. The PRC Patent Law adopts the
principle of “first-to-file” system, which provides that where more than two persons files a
patent application for the same invention, a patent will be granted to the person who files the
application first.
Compared with the prior legislation, the main changes contained in the last amended PRC
Patent Law are concentrated on the following aspects: (i) clarifying the incentive mechanism
for inventor or designer relating to service inventions; (ii) extending the duration of design
patent; (iii) establishing a new system of “open licensing” (஢̙); (iv) strengthening the
joint liability of internet service providers for network patent infringement; (v) improving the
distribution of burden of proof in patent infringement cases; (vi) increasing the compensation
for patent infringement; and (vii) patent term adjustment for compensating unreasonable delays
of relevant authorities in the examination of patent applications. In order to compensate for the
time spent on drug marketing registration and approval procedures, for patents relating to new
drugs approved for marketing in the PRC, the patent term may be extended upon request of the
patent holder by up to five years as determined by the competent patent authorities, and the
total valid period of a patent right shall not exceed 14 years after the relevant new drug
marketing authorization is approved.
Patent enforcement
Unauthorized use of patents without consent from owners of patents, forgery of the
patents belonging to other persons, or engagement in other patent infringement acts, will
subject the infringers to infringement liability. Serious offences such as forgery of patents may
be subject to criminal penalties.
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A patent owner, or an interested party who believes the patent is being infringed, may
either file a civil legal suit or file an administrative complaint with the relevant patent
administration authority. A PRC court may issue a preliminary injunction upon the patent
holder’s or an interested party’s request before instituting any legal proceedings or during the
proceedings. Damages for infringement are calculated as the loss suffered by the patent holder
arising from the infringement or the benefit gained by the infringer from the infringement. If
it is difficult to ascertain damages in this manner, damages may be determined by using a
reasonable multiple of the license fee under a contractual license. Statutory damages may be
awarded in the circumstances where the damages cannot be determined by the abovementioned
calculation standards. The damage calculation methods shall be applied in the aforementioned
order.
Medical patent compulsory license
According to the PRC Patent Law, for the purpose of public health, the State Intellectual
Property Office (the “SIPO”) may grant a compulsory license for manufacturing patented drugs
and exporting them to countries or regions covered under relevant international treaties to
which the PRC has acceded.
Trade Secrets
According to the PRC Anti-Unfair Competition Law (ن
), promulgated by the Standing Committee of the NPC in September 1993, and amended
in November 2017 and April 2019 respectively, the term “trade secrets” refers to technical and
business information that is unknown to the public, has utility, may create business interests
or profits for its legal owners or holders, and is maintained as a secret by its legal owners or
holders. Under the PRC Anti-Unfair Competition Law, business persons are prohibited from
infringing others’ trade secrets by: (1) obtaining the trade secrets from the legal owners or
holders by any unfair methods such as theft, bribery, fraud, coercion, electronic intrusion, or
any other illicit means; (2) disclosing, using or permitting others to use the trade secrets
obtained illegally under item (1) above; (3) disclosing, using or permitting others to use the
trade secrets, in violation of any contractual agreements or any requirements of the legal
owners or holders to keep such trade secrets in confidence; or (4) instigating, inducing or
assisting others to violate confidentiality obligation or to violate a rights holder’s requirements
on keeping confidentiality of trade secrets, disclosing, using or permitting others to use the
trade secrets of the rights holder. If a third party knows or should have known of the
abovementioned illegal conduct but nevertheless obtains, uses or discloses trade secrets of
others, the third party may be deemed to have committed a misappropriation of the others’ trade
secrets. The parties whose trade secrets are being misappropriated may petition for
administrative corrections, and regulatory authorities may stop any illegal activities and fine
infringing parties. On November 22, 2022, the SAMR issued the PRC Anti-Unfair Competition
Law (Draft for Comments) (جن(ᅄӋจԈᇃ)),
which greatly adjusted the identification of unfair competition and the legal liability.
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Trademarks
Pursuant to the Trademark Law of the PRC () promulgated by
the Standing Committee of the NPC in August 1982, and amended in February 1993, October
2001, August 2013 and April 2019 respectively, the period of validity for a registered
trademark is ten years, commencing from the date of registration. The registrant shall go
through the formalities for renewal within twelve months prior to the expiry date of the
trademark if continued use is intended. Where the registrant fails to do so, a grace period of
six months may be granted. The validity period for each renewal of registration is ten years,
commencing from the day immediately after the expiry of the preceding period of validity for
the trademark. In the absence of a renewal upon expiry, the registered trademark shall be
canceled. Industrial and commercial administrative authorities have the authority to investigate
any behavior in infringement of the exclusive right under a registered trademark in accordance
with the law. In case of a suspected criminal offense, the case shall be timely referred to a
judicial authority and decided according to the law. In order to further improve the trademark
system and solve prominent problems in the trademark field, the SIPO issued the Trademark
Law of the PRC (Draft for Comments) (ࣩ(ᅄӋจԈᇃ))o n
January 13, 2023.
Copyright
Pursuant to the Copyright Law of the PRC (), effective in
June 1, 1991 and latest amended on November 11, 2020 and became effective on June 1, 2021,
copyrights include personal rights such as the right of publication and that of attribution as well
as property rights such as the rights of reproduction and distribution. Reproducing,
distributing, performing, projecting, broadcasting or compiling a work or communicating the
same to the public via an information network without permission from the owner of the
copyright therein, unless otherwise provided in the Copyright Law of the PRC, constitutes
infringements of copyrights. The infringer must, according to the circumstances of the case,
undertake to cease the infringement, take remedial action, and offer an apology or pay
damages.
Pursuant to the Computer Software Copyright Protection Regulations (ᚐ
ૢԷ) promulgated on June 4, 1991 and latest amended on January 30, 2013, a software
copyright owner may complete registration formalities with a software registration authority
recognized by the State Council’s copyright administrative department. A software copyright
owner may authorize others to exercise that copyright, and is entitled to receive remuneration.
Domain Names
Domain names are protected under the Administrative Measures on the Internet Domain
Names () issued by the Ministry of Industry and Information
Technology (the “MIIT”), on August 24, 2017 and effective from November 1, 2017. The MIIT
is the main regulatory authority responsible for the administration of PRC internet domain
names. Domain name registrations are handled through domain name service agencies
established under the relevant regulations, and the applicants become domain name holders
upon successful registration.
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REGULATIONS ON ENVIRONMENTAL PROTECTION AND FIRE PREVENTION
Environment Protection
The Environmental Protection Law of the PRC ()
(the “Environmental Protection Law”), which was promulgated by the NPC on December 26,
1989 and last amended on April 24, 2014, outlines the authorities and duties of various
environmental protection regulatory agencies. The Ministry of Environmental Protection is
authorized to issue national standards for environmental quality and emissions, and to monitor
the environmental protection scheme of the PRC.
Environmental Impact Assessment
According to the Administration Rules on Environmental Protection of Construction
Projects (ᚐ၍ଣૢԷ), which was promulgated by the State Council on
November 29, 1998, amended on July 16, 2017 and became effective on October 1, 2017,
depending on the impact of the construction project on the environment, an construction
employer shall submit an environmental impact report or an environmental impact statement,
or file a registration form. As to a construction project, for which an environmental impact
report or the environmental impact statement is required, the construction employer shall,
before the commencement of construction, submit an environmental impact report or the
environmental impact statement to the relevant authority in charge of the environmental
protection administrative department for approval. If the environmental impact assessment
documents of the construction project have not been examined or approved upon examination
by the approval authority in accordance with the law, the construction employer shall not
commence the construction.
According to the Environmental Impact Assessment Law of PRC ( ʕശɛ͏΍ձ਷ᐑྤ
) (the “Environmental Impact Assessment Law”), which was promulgated by the
SCNPC on October 28, 2002, amended on July 2, 2016 and December 29, 2018, construction
entities shall implement the following procedures for their construction projects in accordance
with the Category-based Administration Directory for the Environmental Impact Assessment of
Construction Projects (ணධͦᐑྤᅂᚤ൙ᄆʱᗳ၍ଣΤ፽): (i) for projects with
potentially serious environmental impacts, an environment impact report shall be prepared to
provide a comprehensive assessment of their environmental impacts; (ii) for projects with
potentially mild environmental impacts, an environmental impact statement shall be prepared
to provide an analysis or specialized assessment of their environmental impacts; and (iii) for
projects with very small environmental impacts so that an environmental impact assessment is
not required, an environmental impact registration form shall be filled out. The construction
project at issue may not proceed if its environmental impact assessment documents fail to pass
the review of the competent authority in accordance with the laws and regulations or are
disapproved after the review.
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According to the Category-based Administration Directory for the Environmental Impact
Assessment of Construction Projects (Edition 2021) (ணධͦᐑྤᅂᚤ൙ᄆʱᗳ၍ଣΤ፽
(2021و)) promulgated by the Ministry of Ecology and Environment (the “MEE”),
construction entities shall, in accordance with the provisions of this Directory, respectively
prepare environmental impact reports or environmental impact statements on construction
projects, or complete environmental impact registration forms on construction projects. The
construction projects not covered by this Directory will not be included in the administration
of environmental impact assessment of construction projects.
Pollutant Discharge Licensing
Pursuant to the Administrative Measures for Pollutant Discharge Licensing (for Trial
Implementation) (ج(༊Б)) promulgated on January 10, 2018 and
partially revised on August 22, 2019 by MEE, enterprises and public institutions as well as
other producers and operators included in the Catalogue of Classified Administration of
Pollutant Discharge License for Stationary Pollution Sources shall apply for and obtain a
pollutant discharge license within a prescribed time limit. Any enterprise that fails to obtain a
pollutant discharge license as required shall not discharge pollutants.
According to the Catalogue of Classified Administration of Pollutant Discharge License
for Stationary Pollution Sources (2019 V ersion) (๕રϮ஢̙ʱᗳ၍ଣΤ፽(2019 ϋ
و)) issued by the MEE on December 20, 2019 and effective on the same day, key
management, simplified management and registration management of pollutant discharge
permits are implemented according to factors such as the amount of pollutants generated, the
amount of emissions, the degree of impact on the environment, etc., and only pollutant
discharge entities that implement registration management do not need to apply for a pollutant
discharge permit.
In addition, according to the Regulation on Pollutant Discharge Permit Administration
(રϮ஢̙၍ଣૢԷ) issued by the State Council on January 24, 2021 and effective on
March 1, 2021, the review, decision and information disclosure of pollutant discharge licenses
shall be handled through the national pollutant discharge license management information
platform. A pollutant discharge license is valid for 5 years and the pollutant-discharging entity
should apply for renewal within the 60 days prior to the date of expiry.
Fire Prevention Design and Acceptance
The Fire Prevention Law of the PRC () (the “Fire Prevention
Law”) was adopted on April 29, 1998 and latest amended on April 29, 2021. According to the
Fire Prevention Law, for special construction projects stipulated by the housing and urban-rural
development authority of the State Council, the developer shall submit the fire safety design
documents to the housing and urban-rural development authority for examination, while for
construction projects other than those stipulated as special development projects, the developer
shall, at the time of applying for the construction permit or approval for work commencement
report, provide fire safety design drawings and technical materials which satisfy the
construction needs.
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According to Interim Regulations on Administration of Examination and Acceptance of
Fire Control Design of Construction Projects ()
issued by the Ministry of Housing and Urban-Rural Development of the PRC on April 1, 2020
and effective on June 1, 2020, an examination system for fire prevention design and acceptance
only applies to special construction projects, and for other projects, a record-filing and spot
check system would be applied.
OTHER SIGNIFICANT REGULATIONS OF THE PRC AFFECTING OUR BUSINESS
Product Liability
The Product Quality Law of the PRC () (the “Product
Quality Law”), promulgated by the Standing Committee of the NPC on February 22, 1993 and
latest amended on December 29, 2018, is the principal governing law relating to the
supervision and administration of product quality. According to the Product Quality Law,
manufacturers shall be liable for the quality of products produced by them, and sellers shall
take measures to ensure the quality of the products sold by them. A manufacturer shall be liable
for compensating for any bodily injuries or property damages, other than the defective product
itself, resulting from the defects in the product, unless the manufacturer is able to prove that
(1) the product has never been distributed; (2) the defects causing injuries or damages did not
exist at the time when the product was distributed; or (3) the science and technology at the time
when the product was distributed was at a level incapable of detecting the defects. A seller shall
be liable for compensating for any bodily injuries or property damages of others caused by the
defects in the product if such defects are attributable to the seller. A seller shall pay
compensation if it fails to indicate either the manufacturer or the supplier of the defective
product. A person who is injured or whose property is damaged by the defects in the product
may claim for compensation from the manufacturer or the seller.
On May 28, 2020, the Civil Code of the PRC (Պ) was adopted
by the third session of the 13th NPC, which came into effect on January 1, 2021. According
to the Civil Code of the PRC, a patient may make a claim against the drug marketing
authorization holder, a medical institution or producer for any damage arising from defects of
drugs.
The Law of the PRC on the Protection of the Rights and Interests of Consumers ( ʕശ
) was promulgated on October 31, 1993 and was amended on
August 27, 2009 and October 25, 2013 to protect consumers’ rights when they purchase or use
goods and accept services. All business operators must comply with this law when they
manufacture or sell goods and/or provide services to customers. Where the goods or services
provided by a business operator do not satisfy quality requirements, the consumer may require
the business operator to perform replacement or repair obligations.
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Regulation of Advertisement
Pursuant to the Advertisement Law of the PRC (), which was
promulgated by Standing Committee of the NPC on October 27, 1994 and effective from
February 1, 1995 and latest amended and effective from April 29, 2021, advertisements shall
not contain false statements or be deceitful or misleading to consumers. Advertisements
relating to pharmaceuticals and medical devices, shall be reviewed by relevant authorities in
accordance with applicable rules before being distributed by broadcasting, movies, television,
newspapers, journals or otherwise. The Advertisement further stipulates that advertisements for
medical treatment, pharmaceutical products or medical devices shall not contain: (i) any
assertion or guarantee for efficacy and safety; (ii) any statement on cure rate or effectiveness
rate; (iii) any comparison with the efficacy and safety of other pharmaceutical products or
medical devices or with other healthcare institutions; (iv) recommendation or endorsement of
an advertising endorser; or (v) other items as prohibited by laws and regulations.
Pursuant to the Interim Measures for the Administration of Internet Advertisement ( ʝ
) which was promulgated by the State Administration of Industry and
Commerce on July 4, 2016 and became effective as of September 1, 2016, the Internet
advertisement must be visibly marked as “advertisement.” Advertisements for special
commodities or services such as medical treatment, pharmaceuticals, foods for special medical
purposes, medical instruments, agrochemicals, veterinary medicines and other health foods
must be reviewed by competent authorities before online publication. On 24 March, 2023, the
SAMR promulgated the Measures for Administration of Internet Advertising ( ʝᑌၣᄿѓ၍
) (the “Internet Advertising Measures”), which replaced the Interim Measures for the
Administration of Internet Advertisement, and came into effect as of 1 May 2023. Pursuant to
the Internet Advertising Measures, Internet advertisers are prohibited from publishing
advertisements of prescription drugs on the Internet. Besides, Internet advertisers are
prohibited from publishing advertisements for medical treatment, drugs, medical devices,
health food and formula food for special medical purposes in disguised form by way of
introducing knowledge on health or health maintenance. When introducing knowledge on
health or health maintenance, the address, contact information, shopping links and other
contents of sellers or service providers of relevant medical treatment, drugs, medical devices,
health food, or formula food for special medical purposes shall not be presented on the same
page or together with other contents.
Pursuant to the Measures for Administration of Medical Advertisement ( ᔼᐕᄿѓ၍ଣ
), which were jointly promulgated by the SAIC and the Ministry of Health on November
10, 2006 and effective on January 1, 2007, medical advertisements shall be reviewed by
relevant health authorities and obtain a Medical Advertisement Examination Certificate before
being released. Medical Advertisement Examination Certificate is valid for one year and may
be renewed upon application.
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Pursuant to the Interim Measures for the Administration of Censorship of Advertisements
on Drugs, Medical Devices, Dietary Supplements and Formula Foods for Special Medical
Purposes ()
which were promulgated by the SAMR on December 24, 2019 and effective from March 1,
2020, for medical devices advertisement to be released and published, a manufacturer of
medical devices shall obtain an approval from the NMPA at provincial level. In addition, the
content of advertisements for medical devices is subject to certain guidelines as approved by
the NMPA or its local counterparts at provincial level.
Pursuant to the Measures Regarding the Administration of Drug Information Service
through the Internet (), which was promulgated by the
CFDA and effective from July 8, 2004, and amended and effective from November 17, 2017,
the Internet drug information services, referring to that of providing medical information
(including medical devices information) services to Internet users through the Internet, are
classified into two categories, namely, profit-making services and non-profit services. Any
website intending to provide drug information services through Internet, shall be approved by
NMPA at provincial level before applying for an operation permit or record-filing from the
authority in charge of information industry under the State Council or the administration of
telecommunication at the provincial level.
Information Security and Privacy Protection
On November 7, 2016, the SCNPC promulgated the Cybersecurity Law of the PRC ( ʕ
), which became effect on June 1, 2017, any network operator shall
comply with laws and regulations and fulfill their obligations to ensure the security of the
network when conducting business and providing services. Those who provide services
through networks shall take technical measures and other necessary measures in accordance
with laws, regulations and compulsory national requirements to safeguard the safe and stable
operation of the networks, respond to network security incidents effectively, prevent illegal and
criminal activities committed on the network, and maintain the integrity, confidentiality, and
availability of network data. Network operators shall keep the user information that they have
collected in strict confidence. In addition, the network operators shall neither collect the
personal information irrelevant to the services provided by them nor collect or use the personal
information in violation of the provisions of any law or administrative regulation or the
agreement between both parties. On September 12, 2022, the CAC issued the Decision on
Amending the PRC Cybersecurity Law (Draft for Comments)ҷ<ʕശɛ͏΍ձ਷ၣ
ج>֛(ᅄӋจԈᇃ), which further refines and enhances the legal liabilities for
violating various existing provisions of the Cybersecurity Law of the PRC.
On June 10, 2021, the Standing Committee of the NPC promulgated the Data Security
Law of the PRC () (the “Data Security Law”), which became
effect in September 2021. The Data Security Law provides for data security and privacy
obligations on entities and individuals carrying out data activities and introduces a data
classification and hierarchical protection system based on the importance of data in economic
and social development, as well as the degree of harm it will cause to national security, public
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interests, or legitimate rights and interests of individuals or organizations when such data is
tampered with, destroyed, leaked, or illegally acquired or used. The appropriate level of
protection measures is required to be taken for each respective category of data. For example,
a processor of important data shall designate the personnel and the management body
responsible for data security, carry out risk assessments for its data processing activities and
file the risk assessment reports with the competent authorities. In addition, the Data Security
Law provides a national security review procedure for those data activities which affect or may
affect national security and imposes export restrictions on certain data and information.
On December 28, 2021, the Cyberspace Administration of China (the “CAC”) and other
twelve PRC regulatory authorities jointly revised and promulgated the Measures for
Cybersecurity Review () (the “Cyber Review Measures”), which came
into effect on February 15, 2022. The Cyber Review Measures stipulate that, among others, (i)
when the purchase of network products and services by a critical information infrastructures
operator (the “CIIO”) or the data processing activities conducted by a network platform
operator affect or may affect national security, a cybersecurity review shall be conducted
pursuant to the Cyber Review Measures; (ii) an application for cybersecurity review shall be
made by an issuer who is a network platform operator holding personal information of more
than one million users before such issuer applies to list its securities abroad; and (iii) the
relevant PRC Governmental Authorities may initiate cybersecurity review if such
Governmental Authorities determine that the issuer’s network products or services, or data
processing activities affect or may affect national security. As of the Latest Practicable Date,
we had not received any notification from the relevant competent or regulatory authorities that
we had been determined to be a critical information infrastructure operator or network platform
operators engaging in data processing activities that affect or may affect national security.
On September 30, 2024, the Administration Regulations on Cyber Data Security ( ၣഖ
ᅰኽτΌ၍ଣૢԷ) (the “Data Security Regulations”) was promulgated by the State
Council, which came into effect on January 1, 2025. The Data Security Regulations reiterate
and refine the general regulations for cyber data processing activities, rules of personal
information protection, important data security protection, cyber data cross-border transfer
management, and the responsibilities of online platform service providers. In particular, the
Data Security Regulations provide that cyber data processors whose cyber data processing
activities affect or may affect national security shall be subject to national security review in
accordance with the relevant regulations. However, the Data Security Regulations provide no
further explanation or interpretation for the criteria on determining the risks that “affect or may
affect national security”. Additionally, since the Data Security Regulations are still relatively
new, the interpretation and implementation of these regulations may further evolve and
develop.
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On August 20, 2021, the Standing Committee of the NPC promulgated the Personal
Information Protection Law of the PRC () (the “Personal
Information Protection Law”), which took effect from November 1, 2021. Pursuant to the
Personal Information Protection Law, personal information refers to the information related to
an identified or identifiable individual recorded electronically or by other means, excluding the
anonymized information, and processing of personal information includes among others, the
collection, storage, use, handling, transmission, provision, disclosure, deletion of personal
information. The Personal Information Protection Law explicitly sets forth the circumstances
where it is allowed to process personal information, including (i) the consent of the individual
has been obtained; (ii) it is necessary for the conclusion and performance of a contract under
which an individual is a party, or it is necessary for human resource management in accordance
with the labor related rules and regulations and the collective contracts formulated or
concluded in accordance with laws; (iii) it is necessary to perform statutory duties or statutory
obligations; (iv) it is necessary to respond to public health emergencies, or to protect the life,
health and property safety of individuals in emergencies; (v) carrying out news reports, public
opinion supervision and other acts for the public interest, and processing personal information
within a reasonable scope; (vi) processing personal information disclosed by the individual or
other legally disclosed personal information within a reasonable scope in accordance with this
law; or (vii) other circumstances stipulated by laws and administrative regulations. In addition,
the Personal Information Protection Law emphasizes that individuals have the right to
withdraw their consent to process their personal information, and the processors must not
refuse to provide products or services on the grounds that the individuals do not agree to the
processing of their personal information or withdraw their consent, unless processing of
personal information is necessary for the provision of products or services. Before processing
the personal information, the processors should truthfully, accurately and completely inform
individuals of the following matters in a conspicuous manner and in clear and easy-to-
understand language: (i) the name and contact information of the personal information
processor; (ii) the purpose of processing personal information, processing method, type of
personal information processed, and the retention period; (iii) methods and procedures for
individuals to exercise their rights under this law; (iv) other matters that should be notified
according to laws and administrative regulations. Furthermore, the Personal Information
Protection Law provides that personal information processors who use personal information to
make automated decisions should ensure the transparency of decision-making and the fairness
and impartiality of the results, and must not impose unreasonable differential treatment on
individuals in terms of transaction prices or other transaction conditions.
In addition to the aforementioned general rules, the Personal Information Protection Law
also introduces the rules for processing sensitive personal information, which refers to the
personal information that, once leaked or illegally used, can easily lead to the infringement of
the personal dignity of natural persons or harm personal and property safety, including
biometrics, religious beliefs, specific identities, medical health, financial accounts,
whereabouts and other information, as well as personal information of minors under the age of
fourteen. Personal information processors can process sensitive personal information only if
they have a specific purpose and sufficient necessity, and take strict protective measures. In
addition, the law provides rules for cross-border provision of personal information. In
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particular, it is provided that the operators of critical information infrastructures and the
personal information processors that process personal information up to the number prescribed
by the national cyberspace administration shall store personal information collected and
generated within the PRC. If it is really necessary to provide such personal information
overseas, they shall pass the security assessment organized by the national cyberspace
administration, except as otherwise stipulated by laws, administrative regulations and the
national cyberspace administration. Any processor in violation of this law may be subject to
administrative penalties including rectifications, warnings, fines, confiscation of illegal gains,
suspension of the apps illegally processing personal information or suspension of the relevant
business, revocation of the relevant business permit or the business license, civil liabilities or
even criminal liabilities. The directly responsible personnel in charge and other directly
responsible personnel may be imposed with fines and prohibited from serving as directors,
supervisors, senior management personnel and personal information protection officers of
related companies within a certain period of time.
On July 7, 2022, the CAC released the Measures on Security Assessment of Cross-border
Data Transfer (جthe “Data Export Measures”), which came into effect
on September 1, 2022. The Data Export Measures require that any data processor provide
abroad any important data collected and generated in their business operation within the
territory of the PRC and any personal information for which security assessment is required
shall apply for security assessment by the national cyberspace administration authorities before
transferring any such important data or personal information abroad. The security assessment
requirement also applies to any transfer of important data outside of China.
In addition, on February 24, 2023, the Measures of the Prescribed Agreement on
Cross-border Data Transfer of Personal Information (), or the
Measures of Prescribed Agreement were promulgated by the CAC, which took effect on June
1, 2023. The Measures of Prescribed Agreement attach the prescribed template for cross-border
data transfer agreement that could be used as an available option to satisfy the condition for
cross-border transfer of personal information under Article 38 of the Personal Information
Protection Law.
As of the Latest Practicable Date, we have formulated and updated from time to time
internal management systems to comply with the applicable information security and privacy
protection laws and regulations, and we will continue to maintain our business practices in a
manner that complies with these laws and regulations.
Commercial Briberies in Pharmaceutical Industry
According to the Regulations on the Establishment of Adverse Records with Respect to
Commercial Briberies in the Medicine Purchase and Sales Industry (ͭᔼᖹᒅቖჯਹ
) promulgated in January 2007 and amended in December 2013,
where a manufacturer of drugs, medical devices and medical disposables, an enterprise, an
agency or an individual offers staff of a medical institution any items of value or other benefits,
the enterprise should be listed in the adverse records with respect to commercial bribery in the
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event of the following circumstances: (1) where the act has constituted a crime of bribery as
determined by the ruling of a people’s court, or where the circumstance of crime is not serious
enough for the imposition of criminal punishment and criminal punishment is exempted as
decided by the people’s court in accordance with the Criminal Law; (2) where the circumstance
of the crime of bribery is minor and the relevant people’s procuratorate has decided not to
lodge a prosecution; (3) where a discipline inspection and supervision authority has initiated
a case of bribery and conducted investigation, and punishment has been imposed in accordance
with the law; (4) where administrative penalties against the act of bribery have been imposed
by, inter alia, the finance administration, the SAMR, the NMPA; (5) any other circumstances
specified by laws, regulations and rules. If medical production and operation enterprises are
listed into the Adverse Records of Commercial Briberies for the first time, their products shall
not be purchased by public medical institutions, and medical and health institutions receiving
financial subsidies in local province for two years since publication of the record, and public
medical institution, and medical and health institutions receiving financial subsidies in other
province shall lower their rating in bidding or purchasing process. If medical production and
operation enterprises are listed into the Adverse Records of Commercial Bribery for twice or
more in five years, their products shall not be purchased by public medical institutions, and
medical and health institutions receiving financial subsidies nationwide for two years since
publication of the record.
According to the Guiding Opinions on Establishment of the Trustworthiness Evaluation
System for Drug Prices and Procurement by Bidding (͜൙ᄆՓ
ኬจԈ) promulgated by the NHSA in August 2020 and took effect simultaneously,
the NHSA would establish a catalogue of dishonest matters involving drug prices and
procurement by bidding, and the kickbacks or other improper benefits in the purchase and sale
of drugs, tax-related violations of laws, monopolistic practices, improper pricing practices,
disruption of the order of centralized procurement, malicious breach of contracts and other
malpractices, will be included in such catalogue. Provincial centralized procurement agencies
shall assess and rate the dishonest conduct of pharmaceutical enterprises into four levels:
general, medium, serious and particularly serious, based on the nature, circumstances,
effectiveness and impact of such dishonest conduct. Further, the provincial centralized
procurement agencies shall, according to the trustworthiness ratings of pharmaceutical
enterprises, take punitive measures, such as warnings and admonishments, restriction on
market entry, and release of dishonest information.
Anti-unfair Competition and Enterprise-related Crimes
Competition among business operators is generally governed by the Anti-unfair
Competition Law of the PRC () (the “Anti-unfair
Competition Law”), which was promulgated by the Standing Committee of the NPC on 2
September 1993 and last amended on 23 April 2019. According to the Anti-unfair Competition
Law, when trading on the market, operators must abide by the principles of voluntariness,
equality, fairness and honesty and observe laws and business ethics. Acts of operators
constitute unfair competition where they contravene the provisions of the Anti-unfair
Competition Law and disturb market competition with a result of damaging the lawful rights
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and interests of other operators or consumers. Where the legitimate rights and interests of a
operator are harmed by unfair competition, the operator may file a lawsuit with a People’s
Court. The compensation for a operator who suffer damages due to unfair competition shall be
determined in accordance with the actual losses suffered as a result of the infringement; where
it is hard to ascertain the actual losses, the compensation shall be determined in accordance
with the gains made by the infringing person from the infringement. For operators who infringe
upon commercial secrets maliciously and if the case is serious, the compensation amount may
be determined in accordance with one to five times the amount determined using the aforesaid
method. The compensation amount shall also include reasonable expenses paid by the operator
to stop the infringement. On November 22, 2022, the SAMR issued the PRC Anti-Unfair
Competition Law (Draft for Comments) (جن(ᅄӋจ
Ԉᇃ)), which greatly adjusted the identification of unfair competition and the legal liability.
On June 3, 2021, the Supreme People’s Procuratorate and other seven PRC regulatory
authorities or organizations jointly promulgated the Guiding Opinions on Establishment of a
Third-party Supervision and Evaluation Mechanism for the Compliance of Enterprises
Involved in Cases (for Trial Implementation) (ΆุΥ஝ୋɧ˙္ຖ൙ПዚՓ
ኬจԈ(༊Б)) (the “Guiding Opinions”). According to the Guiding Opinions, when the
People’s Procuratorate handles an enterprise-related criminal case, a third-party supervision
and evaluation mechanism for the compliance of the enterprise involved (the “third-party
mechanism”) may be applied where the case meets the applicable conditions for the pilot
program of corporate compliance reform, under which a third-party supervision and evaluation
organization shall be organized to investigate, evaluate, supervise and inspect the compliance
commitment of the enterprise involved. The third-party mechanism is applicable to the
economic crimes and duty-related crimes committed during the production and operation
activities of the market players such as companies and enterprises, and the People’s
Procuratorate shall take the compliance materials such as the written compliance inspection
report issued by the third party as important references when making prosecution decisions or
issuing procuratorial opinions.
Regulations on Overseas Listing
CSRC Filing Requirements for Overseas Offering and Listing
On February 17, 2023, the China Securities Regulatory Commission (the “CSRC”)
promulgated the Trial Administrative Measures of the Overseas Securities Offering and Listing
by Domestic Enterprises () and relevant five
guidelines (together, the “Overseas Listing Trial Measures”), which became effective on March
31, 2023. The Overseas Listing Trial Measures comprehensively improve and reform the
existing regulatory regime for overseas offering and listing of PRC domestic companies’
securities, and regulate both direct and indirect overseas offering and listing of PRC domestic
companies’ securities by adopting a filing-based regulatory regime.
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Pursuant to the Overseas Listing Trial Measures, PRC domestic companies that seek to
offer and list securities in overseas markets, either in direct or indirect means, are required to
fulfil the filing procedure with the CSRC and report relevant information. The Overseas Listing
Trial Measures provide that an overseas offering and listing is explicitly prohibited, if any of
the following exists: (i) such securities offering and listing is explicitly prohibited by
provisions in laws, administrative regulations and relevant state rules; (ii) the intended
overseas securities offering and listing may endanger national security as reviewed and
determined by competent authorities under the State Council in accordance with law; (iii) the
domestic company intending to make the securities offering and listing, or its controlling
shareholder(s) and the actual controller, have committed relevant crimes such as corruption,
bribery, embezzlement, misappropriation of property or undermining the order of the socialist
market economy during the latest three years; (iv) the domestic company intending to make the
securities offering and listing is currently under investigations for suspicion of criminal
offenses or major violations of laws and regulations, and no conclusion has yet been made
thereof; or (v) there are material ownership disputes over equity held by the domestic
company’s controlling shareholder(s) or by other shareholder(s) that are controlled by the
controlling shareholder(s) and/or actual controller.
The Overseas Listing Trial Measures also provide that if the issuer meets both the
following criteria, the overseas securities offering and listing conducted by such issuer will be
deemed as indirect overseas offering by PRC domestic companies: (i) more than 50% of any
of the issuer’s operating revenue, total profit, total assets or net assets as documented in its
audited consolidated financial statements for the most recent fiscal year is accounted for by
domestic companies; and (ii) the main parts of the issuer’s business activities are conducted in
mainland China, or its main place(s) of business are located in mainland China, or the majority
of senior management staff in charge of its business operations and management are PRC
citizens or have their usual place(s) of residence located in mainland China. The determination
of the indirect overseas issuance and listing of domestic enterprises follows the principle of
“substance over form.”
According to the Overseas Listing Trial Measures, where an issuer submits an application
for initial public offering to competent overseas regulators, such issuer must file with the
CSRC within three business days after such application is submitted. Generally, once the filing
documents are complete and in compliance with the stipulated requirements, the CSRC will,
within 20 working days, conclude the review procedure and publish the filing results on the
CSRC website. To the extent the filing documents are incomplete or do not conform to
stipulated requirements, the CSRC will, within 5 working days upon receipt of filing
documents, request supplementation and amendment to the filing. Then the issuer has 30
working days to prepare any requested supplemented/amended filing. In addition, following
the listing on an overseas market, the issuer shall submit a report to the CSRC within 3 working
days after the occurrence and public disclosure of the following events involving the issuer: (i)
change of control; (ii) investigations or sanctions imposed by overseas regulators; (iii) change
of listing status; and (iv) voluntary or involuntary delisting. Besides, if any material change in
the principal business and operation of the issuer after its overseas offering and listing takes
place and results in the issuer no longer within the scope of record-filing under Overseas
Listing Trial Measures, the issuer shall submit a special report and a legal opinion issued by
a PRC law firm to the CSRC within 3 working days after the occurrence of such change in
order to provide an explanation of the relevant situation.
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Non-compliance with the Overseas Listing Trial Measures will result in regulatory action
by the CSRC and fines for PRC issuers in an amount up to RMB10 million. If a domestic
company fails to comply with the filing procedures or conceals material facts or falsifies major
contents in the filing documents, it may be ordered to make corrections, warned, fined and
other administrative penalties, and its controlling shareholder, de facto controller, directly
responsible supervisors and other directly responsible persons may also be warned or fined.
CSRC Requirements on Confidentiality and Archives Administration for Overseas Offering
and Listing
On February 24, 2023, the CSRC, the Ministry of Finance, National Administration of
State Secrets Protection and National Archives Administration of China jointly released the
revised Provisions on Strengthening the Confidentiality and Archives Administration of
Overseas Securities Offering and Listing by Domestic Companies (̋੶ྤʫΆุྤ̮೯
), or the Archives Administration Provisions,
which came into effect on March 31, 2023. The Archives Administration Provisions shall apply
to both (i) the PRC domestic companies seeking direct listing on the overseas stock exchange
and (ii) the PRC domestic operating entities of a foreign company seeking listing on the
overseas stock exchange that qualifies as an “indirect listing” (above (i) and (ii) collectively,
“Domestic Companies”).
According to the Archives Administration Provisions, the Domestic Companies shall
establish and implement a solid confidentiality and archives administration system. If a
Domestic Company decides to disclose any documents or materials containing state secrets,
work secrets of governmental agencies or any Information that may be detrimental to national
security or public interest once leaked, a domestic enterprise shall apply to the competent
department with examination and approval authority for approval in accordance with the law,
and file the same with the secrecy administration at the same level for the record. After
obtaining the governmental clearance, the Domestic Company disclosing such information, as
one party, and the securities companies and securities services providers receiving such
information, as the other party, shall also enter into non-disclosure agreements, setting forth the
confidentiality obligations of the securities companies and securities services providers. When
providing above information to the securities companies and securities services providers
retained by it, the Domestic Companies are also required to issue a written statement outlining
its compliance with the relevant regulatory requirements and procedures.
In terms of providing accounting archives or copies thereof to any other entities or
persons (such as securities companies, securities services providers and overseas regulators),
the Archives Administration Provisions stipulate that relevant governmental procedures should
be followed.
Any violation of the Archives Administration Provisions may subject the Domestic
Companies to regulatory penalties under the PRC Law of Safeguarding State Secrets ( ʕശ
) and the PRC Law of Archives ()
and even criminal liabilities to the extent applicable.
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Foreign Exchange Control
The PRC Foreign Exchange Administration Regulations ( ʕശɛ͏΍ձ਷̮ි၍ଣૢ
Է) promulgated by the State Council on January 29, 1996, which was latest amended on
August 5, 2008, are the principal regulations governing foreign currency exchange in China.
Under the PRC foreign exchange regulations, payments of current account items, such as profit
distributions and trade and service-related foreign exchange transactions, may be made in
foreign currencies without prior approval from the SAFE by complying with certain procedural
requirements. In contrast, approval from or registration with appropriate Governmental
Authorities or designated banks is required when RMB is to be converted into a foreign
currency and remitted out of China to pay capital expenses such as the repayment of foreign
currency-denominated loans.
In 2019, the SAFE promulgated Notice by the State Administration of Foreign Exchange
of Further Facilitating Cross-border Trade and Investment (ک
), which cancelled restrictions on domestic equity investments made with capital
funds by non-investing foreign-funded enterprises. If a non-investing foreign-funded enterprise
makes domestic equity investment with capital funds obtained from foreign exchange
settlement, the investee shall undergo registration formalities for accepting domestic
reinvestment and open the “capital account – account for settled foreign exchange to be paid”
to receive the corresponding funds according to relevant provisions. On April 10, 2020, the
SAFE promulgated the Circular on Optimizing Administration of Foreign Exchange to Support
the Development of Foreign-related Business (ٝ,)
or SAFE Circular 8, under which eligible enterprises are allowed to make domestic payments
by using their capital funds, foreign loans and the income under capital accounts of overseas
listing, without providing the evidentiary materials concerning authenticity of each expenditure
in advance, provided that their capital use shall be authentic, and conform to the prevailing
administrative regulations on the use of income under capital accounts.
Dividend Distribution
The SAFE promulgated the Notice on Improving the Check of Authenticity and
Compliance to Further Promote the Reform of Foreign Exchange Control (ආɓӉપආ
) in January 2017, which stipulates several capital
control measures with respect to outbound remittance of profits from domestic entities to
offshore entities, including the following: (1) under the principle of genuine transaction, banks
shall check board resolutions regarding profit distribution, the original version of tax filing
records and audited financial statements; and (2) domestic entities shall hold income to account
for previous years’ losses before remitting the profits. Moreover, domestic entities shall make
detailed explanations of sources of capital and utilization arrangements, and provide board
resolutions, contracts and other proof when completing the registration procedures in
connection with an outbound investment.
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Foreign Exchange Registration of Offshore Investment by PRC Residents
In July 2014, the SAFE promulgated the Notice of the State Administration of Foreign
Exchange on Issues concerning Foreign Exchange Administration of the Overseas Investment
and Financing and the Round-tripping Investment Made by Domestic Residents through
Special-Purpose Companies (೻ҳ༟̮ි၍
) (the “SAFE Circular 37”). The SAFE Circular 37 requires PRC
residents, including PRC individuals and PRC corporate entities, to register with SAFE or its
local branches in connection with their direct or indirect offshore investment activities.
Under the SAFE Circular 37, PRC residents who make, or have prior to the
implementation of the SAFE Circular 37 made, direct or indirect investments in an offshore
special purpose vehicle (the “SPV”) are required to register such investments with SAFE or its
local branches. In addition, any PRC resident who is a direct or indirect shareholder of an SPV ,
is required to update its registration with the local branch of SAFE with respect to that SPV ,
to reflect any change of basic information or material events. If any PRC resident shareholder
of such SPV fails to make the required registration or to update the registration, the subsidiary
of such SPV in China may be prohibited from distributing its profits or the proceeds from any
capital reduction, share transfer or liquidation to the SPV , and the SPV may also be prohibited
from making additional capital contributions into its subsidiaries in China.
Employee Stock Incentive Plan
On February 15, 2012, the SAFE promulgated the Notice of the State Administration of
Foreign Exchange on Issues concerning the Foreign Exchange Administration of
Domestic Individuals’ Participation in Equity Incentive Plans of Overseas
Listed Companies (ྌ̮ි၍ଣ
) (the “Stock Option Rules”). In accordance with the Stock Option Rules and
relevant rules and regulations, PRC citizens or non-PRC citizens residing in China for a
continuous period of not less than one year, who participate in any stock incentive plan of an
overseas publicly listed company, subject to a few exceptions, are required to register with the
SAFE through a domestic qualified agent, which could be a PRC subsidiary of such overseas
listed company, and complete certain procedures. In addition, the domestic agency is required
to amend the SAFE registration with respect to the stock incentive plan if there is any material
change to the stock incentive plan. Moreover, the SAFE Circular 37 provides that PRC
residents who participate in a share incentive plan of an overseas unlisted special purpose
company may register with local branches of SAFE before exercising rights.
Labor Law and Labor Contract Law
Pursuant to the PRC Labor Law () promulgated by the
Standing Committee of the NPC on July 5, 1994 and latest amended on December 29, 2018 and
the PRC Labor Contract Law () promulgated by the Standing
Committee of the NPC on June 29, 2007 and latest amended on December 28, 2012, employers
must execute written labor contracts with full-time employees. All employers must comply
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with local minimum wage standards. Employers must establish a comprehensive management
system to protect the rights of their employees, including a system governing occupational
health and safety to provide employees with occupational training to prevent occupational
injury, and employers are required to truthfully inform prospective employees of the job
description, working conditions, location, occupational hazards and status of safe production
as well as remuneration and other conditions. Violations of the PRC Labor Contract Law and
the PRC Labor Law may result in the imposition of fines and other administrative and criminal
liability in the case of serious violations.
Social Insurance and Housing Provident Funds
According to the Social Insurance Law of PRC (), which
was promulgated by the Standing Committee of the NPC in October 2010 and came into effect
in July 2011, and further amended in December 2018, and the Interim Regulations on the
Collection and Payment of Social Security Funds (ᎈ൬ᅄᖮᅲБૢԷ), which was
promulgated by the State Council in January 1999 and amended in March 2019, and the
Regulations on the Administration of Housing Provident Funds (၍ଣૢԷ),
which was promulgated by the State Council in April 1999 and amended in March 2002 and
March 2019, employers are required to contribute, on behalf of their employees, to a number
of social security funds, including funds for basic pension insurance, unemployment insurance,
basic medical insurance, occupational injury insurance, maternity insurance and to housing
provident funds. Any employer who fails to contribute may be fined and ordered to make good
the deficit within a stipulated time limit.
Enterprise Income Tax
Pursuant to the PRC Enterprise Income Tax Law ()
effective as of January 1, 2008 and latest amended on December 29, 2018, the income tax rate
for both domestic and foreign-invested enterprises is 25% with certain exceptions. To clarify
certain provisions in the PRC Enterprise Income Tax Law, the State Council promulgated the
Implementation Rules of the Enterprise Income Tax Law (ྼ
ૢԷ) on December 6, 2007, which was latest amended and became effective on April 23,
2019. Under the PRC Enterprise Income Tax Law and the Implementation Rules of the PRC
Enterprise Income Tax Law, enterprises are classified as either “resident enterprises” or
“non-resident enterprises.” Aside from enterprises established within the PRC, enterprises
established outside of China whose “de facto management bodies” are located in China are
considered “resident enterprises” and are subject to the uniform 25% enterprise income tax rate
for their global income. In addition, the PRC Enterprise Income Tax Law provides that a
non-resident enterprise refers to an entity established under foreign law whose “de facto
management bodies” are not within the PRC, but has an establishment or place of business in
the PRC, or does not have an establishment or place of business in the PRC but has income
sourced within the PRC.
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The Implementation Rules of the PRC Enterprise Income Tax Law provide that since
January 1, 2008, an income tax rate of 10% shall normally be applicable to dividends declared
to non-PRC resident enterprise investors that do not have an establishment or place of business
in the PRC, or have such establishment or place of business but the relevant income is not
effectively connected with the establishment or place of business, to the extent such dividends
are derived from sources within the PRC. The income tax on the dividends may be reduced
pursuant to a tax treaty between China and the jurisdictions in which the non-PRC shareholders
reside.
According to the Notice of the State Administration of Taxation on Delivering the Table
of Negotiated Dividends and Interest Rates to Lower Levels (ٰ֛
) issued on January 29, 2008, latest revised on February 29, 2008,
and the Arrangement between Mainland China and the Hong Kong Special Administrative
Region for the Avoidance of Double Taxation and Prevention of Fiscal Evasion with Respect
to Taxes on Income (τ
ર) (the “Double Tax Avoidance Arrangement”), the withholding tax rate in respect of the
payment of dividends by a PRC enterprise to a Hong Kong enterprise may be reduced to 5%
from a standard rate of 10% if the Hong Kong enterprise directly holds at least 25% of the PRC
enterprise and certain other conditions are met, including: (i) the Hong Kong enterprise must
directly own the required percentage of equity interests and voting rights in the PRC resident
enterprise; and (ii) the Hong Kong enterprise must have directly owned such required
percentage in the PRC resident enterprise throughout the 12 months prior to receiving the
dividends. However, based on the Circular on Certain Issues with Respect to the Enforcement
of Dividend Provisions in Tax Treaties ()
issued on February 20, 2009 by the State Taxation Administration, if the relevant PRC tax
authorities determine, in their discretion, that a company benefits from such reduced income
tax rate due to a structure or arrangement that is primarily tax-driven, such PRC tax authorities
may adjust the preferential tax treatment; and based on the Announcement on Certain Issues
with Respect to the “Beneficial Owner” in Tax Treaties (ʕ“Ϟɛ”Ϟᗫ
ʮѓ) issued by the State Taxation Administration on February 3, 2018 and effective
from April 1, 2018, if an applicant’s business activities do not constitute substantive business
activities, it could result in the negative determination of the applicant’s status as a “beneficial
owner”, and consequently, the applicant could be precluded from enjoying the above-
mentioned reduced income tax rate of 5% under the Double Tax Avoidance Arrangement.
Other PRC National and Provincial-Level Laws and Regulations
We are subject to changing regulations under many other laws and regulations
administered by Governmental Authorities at the national, provincial and municipal levels,
some of which are or may become applicable to our business.
We also comply with numerous additional national and provincial laws relating to matters
such as safe working conditions, manufacturing practices, environmental protection and fire
hazard control. We believe that we are currently in compliance with these laws and regulations;
however, we may be required to incur significant costs to comply with these laws and
regulations in the future. Unanticipated changes in existing regulatory requirements or
adoption of new requirements could therefore have a material adverse effect on our business,
results of operations and financial condition.
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OVERVIEW
We are a late-stage, near-commercialization biopharmaceutical company focused on
providing treatments in selected endocrinology diseases in China (including Hong Kong,
Macau and Taiwan). Our Company was founded by our Founding Shareholders, namely,
Ascendis Pharma A/S (through its wholly-owned subsidiaries), Vivo Capital and Sofinnova.
Further information on our Founding Shareholders are set forth in “– Pre-IPO Investments –
Information about our Shareholders” in this section below. For further details regarding
Ascendis Pharma A/S and Vivo Capital, see also “Relationship with the Controlling
Shareholders.”
Our Company was incorporated in the Cayman Islands on November 1, 2018. Our
principal businesses are carried out by the Company and its subsidiaries including our
wholly-owned major and operating subsidiary in Shanghai, the PRC, VISEN Shanghai.
OUR BUSINESS MILESTONES
The following table illustrates the key milestones of our business development since our
inception:
November 2018 Our Company was incorporated in the Cayman Islands
The Series A financing was completed and a total of US$40
million in cash was raised from Vivo Capital and Sofinnova
Our Company entered into several Exclusive License
Agreements with Ascendis Pharma Endocrinology Division,
Ascendis Pharma Growth Disorders and Ascendis Pharma Bone
Diseases, pursuant to which our Company was granted
exclusive licenses to develop, manufacture and commercialize
lonapegsomatropin, TransCon CNP (navepegritide) and
palopegteriparatide, in China (including Hong Kong, Macau and
Taiwan), and our Company issued to these three wholly-owned
subsidiaries of Ascendis Pharma A/S an aggregate of 40,000,000
Series A Preferred Shares
October 2019 Our Company obtained the IND approval from the NMPA to
commence the Phase 3 pivotal trial for lonapegsomatropin in
China for the treatment of PGHD
December 2020 Our Company entered into a strategic cooperation agreement
with CHARD on ACH registration study and diagnosis
consensus
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January 2021 Our Company completed the Series B financing and raised a
total of approximately US$150 million, and introduced
investors including HongShan Growth, OrbiMed, Sherpa
Healthcare Partners, Cormorant, HBM Healthcare Investments,
Pivotal bioV enture Partners China, Logos Capital and CRF
Investment
Our Company obtained the IND approval from the NMPA to
commence the China Phase 2 trial of TransCon CNP
(navepegritide)
March 2021 The patient enrollment of children with GHD for the Phase 3
pivotal trial of lonapegsomatropin across 17 sites was
completed
The patient enrollment of the ACHieve Study was completed,
with 83 subjects enrolled in six sites
May 2021 Our Company obtained the IND approval from the NMPA to
commence the Phase 3 pivotal trial for palopegteriparatide in
China for the treatment of adult HP
ApproaCH Study, a national patient registry study for ACH, was
initiated
July 2021 VISEN Shanghai entered into a strategic collaboration
agreement with Peking University Health Science Center to
initiate the PaTHway R study of palopegteriparatide, the first
registry study for HP patients in China and one of the largest
epidemiological surveys for this disease worldwide
September 2021 The China Phase 2 trial of TransCon CNP (navepegritide) was
initiated
April 2022 The Phase 3 pivotal trial for lonapegsomatropin in patients with
PGHD was completed
June 2022 The patient enrollment for the Phase 3 pivotal trial for
palopegteriparatide was completed
November 2022 The results from the completed Phase 3 pivotal trial of
lonapegsomatropin was announced, which continued to support
lonapegsomatropin’s superior growth profile and comparable
safety profile in comparison to daily hGH
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January 2023 Our Company completed the double-blind period for primary
endpoint for our ongoing China Phase 3 pivotal trial of
palopegteriparatide, PaTHway China Trial, which demonstrates
consistency with the global Phase 3 pivotal trial in terms of
primary endpoint and safety profile
June 2023 Our Company received confirmation from the CDE of the
NMPA confirming the completion status of our Phase 3 pivotal
trial and approving us to proceed with the BLA filing of
lonapegsomatropin for the treatment of PGHD
July 2023 Our Company entered into a Technology Transfer Master Plan
of the Core Product with Ascendis Pharma, which has marked
the commencement of the Technology Transfer and Localization
with respect to the manufacturing of the Core Product from
Ascendis Pharma to us and sets forth the obligations of both
parties under the Exclusive License Agreement with respect to
such Technology Transfer and Localization
October 2023 Our Company entered into a commercial supply agreement with
Ascendis Pharma for the purchase of Core Product from
Ascendis Pharma by the Company, which will secure the
imported drug supply of the Core Product after BLA filing
approval. Under the commercial supply agreement, Ascendis
Pharma will provide the Company with the agreed stock of
packaged product for the initial launch of the Core Product
November 2023 The primary analysis of Phase 2 clinical trial in China of
TransCon CNP (navepegritide) for the treatment of ACH has
been completed, which completed the double-blind period with
primary endpoint met according to the topline results
March 2024 The BLA filing of our Core Product for the treatment of PGHD
was accepted by the NMPA
April 2024 The last patient last visit of the OLE period of Phase 2 clinical
trial in China of TransCon CNP (navepegritide) for the
treatment of ACH was completed
August 2024 Our Company entered into the strategic collaboration with the
United Family Healthcare, one of the leading private healthcare
providers in China with a network of over ten hospitals and over
20 clinics across China, which will focus on jointly developing
capabilities in diagnosis, treatment and services for children
with medical needs in growth and development
MAJOR CORPORATE DEVELOPMENT AND SHAREHOLDING CHANGES OF OUR
GROUP
The following sets forth the major corporate history and shareholding changes of our
Company and major subsidiary.
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Our Company
Incorporation of our Company
Our Company was incorporated in the Cayman Islands under the Companies Act as an
exempted company with limited liability on November 1, 2018, with an authorized capital of
US$50,000 divided into 500,000,000 shares with a par value of US$0.0001 each. Immediately
after the incorporation of our Company, one ordinary share was allotted and issued to its initial
subscriber, International Corporation Services Ltd., and was then transferred to Vivo Plenilune
IX Limited on November 2, 2018. Such ordinary share was repurchased and cancelled by the
Company on November 7, 2018.
Series A Financing
On November 7, 2018, our Company entered into the Series A Share Purchase Agreement
with our Founding Shareholders, namely Ascendis Pharma A/S, Vivo Capital and Sofinnova.
The Founding Shareholders became acquainted with each other as each of Vivo Capital and
Sofinnova is a minority shareholder of Ascendis Pharma A/S. They were enthusiastic about the
potential of Ascendis’ endocrinology portfolio, the rapidly expanding pharmaceutical market
in China, and the evolving regulatory landscape in the country. Motivated by these factors, they
jointly established the Company to capture such market opportunity. Pursuant to the Series A
Share Purchase Agreement, our Company issued 35,000,000 and 5,000,000 Series A Preferred
Shares to Vivo Capital and Sofinnova, for a cash consideration of US$35,000,000 and
US$5,000,000, respectively. In addition, our Company issued to three wholly-owned
subsidiaries of Ascendis Pharma A/S an aggregate of 40,000,000 Series A Preferred Shares as
consideration for them to enter into the Exclusive License Agreements and Clinical Supply
Agreements in respect of lonapegsomatropin, TransCon CNP (navepegritide) and
palopegteriparatide with our Company.
The Series A Preferred Shares were allotted and issued on November 7, 2018 as set forth
in the table below:
Name of Shareholders
Number of
Series A
Preferred
Shares
Cash
Consideration
(US$)
Ascendis Pharma
– Ascendis Pharma Endocrinology Division (1) 20,000,000 – (2)
– Ascendis Pharma Growth Disorders (1) 7,500,000 – (2)
– Ascendis Pharma Bone Diseases (1) 12,500,000 – (2)
Vivo Capital 35,000,000 35,000,000
Sofinnova 5,000,000 5,000,000
Total 80,000,000 40,000,000
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Notes:
(1) Ascendis Pharma Endocrinology Division, Ascendis Pharma Growth Disorders and Ascendis Pharma
Bone Diseases are wholly-owned subsidiaries of Ascendis Pharma A/S.
(2) 40,000,000 Series A Preferred Shares were allotted and issued to the three wholly-owned subsidiaries
of Ascendis Pharma A/S as consideration for entering into the Exclusive License Agreements and
Clinical Supply Agreements. For further details, please see the section headed “Business –
Collaborations – Exclusive License Agreements with Ascendis Pharma” in this document.
Series B Financing
On January 8, 2021, our Company entered into the Series B Share Purchase Agreement
with the following investors who subscribed from our Company an aggregate of 13,636,364
Series B Preferred Shares for a total consideration of approximately US$150 million in
accordance to the terms and subject to the conditions set forth therein.
The Series B Preferred Shares were allotted and issued on January 8, 2021 as set forth in
the table below:
Name of Shareholders
Number of
Series B
Preferred
Shares Consideration
(US$)
HongShan Growth 4,090,909 44,999,999
OrbiMed
– Worldwide Healthcare Trust PLC 1,454,546 16,000,006
– OrbiMed Genesis Master Fund, L.P . 181,818 1,999,998
– OrbiMed New Horizons Master Fund, L.P . 181,818 1,999,998
Sherpa Healthcare Partners
– Sherpa Healthcare Fund I, L.P . 1,363,636 14,999,996
– Sherpa Healthcare Co-Investment Fund, L.P . 454,546 5,000,006
Cormorant
– Cormorant Global Healthcare Master
Fund, LP 248,400 2,732,400
– Cormorant Private Healthcare Fund III, LP 824,945 9,074,395
– CRMA SPV , L.P . 17,564 193,204
HBM Healthcare Investments 681,818 7,499,998
Pivotal bioV enture Partners China 590,909 6,499,999
Logos Capital 590,909 6,499,999
CRF Investment 454,545 4,999,995
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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Name of Shareholders
Number of
Series B
Preferred
Shares Consideration
(US$)
Ascendis Pharma
– Ascendis Pharma Endocrinology Division 568,182 6,250,002
– Ascendis Pharma Growth Disorders 213,068 2,343,748
– Ascendis Pharma Bone Diseases 355,114 3,906,254
Vivo Capital 1,136,364 12,500,004
Sofinnova 227,273 2,500,003
Total 13,636,364 150,000,004
Equity Incentive Plan
In order to motivate, attract and encourage certain employees, directors, consultants and
other eligible persons, our Company adopted the Equity Incentive Plan which was approved by
the Board on April 29, 2019, and amended and restated on January 8, 2021 and March 10, 2021
by the Board, respectively. The principal terms of the Equity Incentive Plan are set out in
“Appendix IV – Statutory and General Information – D. Equity Incentive Plan.” The terms of
the Equity Incentive Plan are not subject to the provisions of Chapter 17 of the Listing Rules.
After Listing, no further awards would be granted pursuant to this Equity Incentive Plan.
On March 30, 2021, the Company issued and allotted to VP EIP NUS LIMITED, VP EIP
US LIMITED and Mr. Lu An-bang 11,000,000 Shares, 4,000,000 Shares and 5,000,000 Shares,
respectively, for the operation of the Equity Incentive Plan.
The RSUs in respect of 5,000,000 Shares were granted to Mr. Lu An-bang on March 30,
2021. On the same date, Mr. Lu An-bang transferred the 5,000,000 Shares underlying Mr. Lu
An-bang’s such RSUs to VPP LU LIMITED, a special purpose vehicle wholly owned by a
family trust established by Mr. Lu An-bang (as the settlor) of which the trustee is Tricor Equity
Trustee Limited for the benefit of, among others, Mr. Lu An-bang and his family members, by
way of gift.
VP EIP NUS LIMITED is a special purpose vehicle wholly owned by a PRC employee
trust (“PRC Employee Trust”) of which the trustee is Tricor Trust (Hong Kong) Limited
(“Tricor HK”). The PRC Employee Trust is established as reserve for vesting of awards under
the Equity Incentive Plan which may be granted to employees and consultants (each as defined
thereunder) of PRC Nationality. VP EIP US LIMITED is a special purpose vehicle wholly
owned by an U.S. employee escrow (“U.S. Employee Escrow”) of which the trustee is Tricor
HK. The U.S. Employee Escrow is established as reserve for vesting of RSUs under the Equity
Incentive Plan which may be granted to employees and consultants (each as defined
thereunder) of U.S. Nationality. Both the PRC Employee Trust and the U.S. Employee Escrow,
managed by the trustee, an Independent Third Party, operate independently and all of the
Shares hold by the PRC Employee Trust and the U.S. Employee Escrow are non-voting Shares.
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On March 30, 2021, the Company issued and allotted to VP EIP NUS LIMITED and VP
EIP US LIMITED 11,000,000 Shares and 4,000,000 Shares, respectively, for the operation of
the Equity Incentive Plan. On November 15, 2022, the Company entered into share surrender
agreements with VP EIP NUS LIMITED and VP EIP US LIMITED, pursuant to which VP EIP
NUS LIMITED surrendered for no consideration of 7,859,500 Shares, VP EIP US LIMITED
surrendered for no consideration of 2,800,000 Shares. The surrendered shares were canceled
accordingly on November 16, 2022. On February 17, 2025, the Company entered into a share
surrender agreement with VP EIP NUS LIMITED, pursuant to which VP EIP NUS LIMITED
surrendered for no consideration of 765,000 Shares. The surrendered shares were canceled
accordingly on February 18, 2025. On February 18, 2025, the Company issued 330,000 Shares
to VP EIP US LIMITED without consideration. As a result, VP EIP NUS LIMITED and VP EIP
US LIMITED holds 2,375,500 and 1,530,000 non-voting Shares in the Company, respectively.
All the Shares issued and allotted by the Company to VP EIP NUS LIMITED and VP EIP US
LIMITED are non-voting Shares.
As of the Latest Practicable Date, there were outstanding RSUs representing 8,905,500
Shares that had been granted to 24 grantees under the Equity Incentive Plan, among which
RSUs representing 5,000,000 Shares were granted to Mr. Lu and held by VPP LU Limited, and
RSUs representing 3,905,500 Shares have been granted to other grantees of the Company and
held by VP EIP NUS LIMITED and VP EIP US LIMITED. For more details of the grants,
please refer to the paragraphs headed “D. Equity Incentive Plan – 12. Outstanding Grants” in
Appendix IV to this prospectus. Expect for the above, no further RSUs will be granted pursuant
to the Equity Incentive Plan prior to the Listing. As such, at the time of Listing, save as Mr.
Lu, no Director or core connected person of the Company will be a grantee under the Equity
Incentive Plan. After Listing, no further awards would be granted pursuant to this Equity
Incentive Plan.
Post-IPO Share Award Scheme
Concurrently with the Share Surrender, the Company adopted the Post IPO Share Award
Scheme which was approved by the Board on November 8, 2022 and the Shareholders on
November 16, 2022, with effect from the Listing Date. The Post-IPO Share Award Scheme is
compliant with the provisions of Chapter 17 of the Listing Rules. The principal terms of the
Post-IPO Share Award Scheme are set out in “Appendix IV – Statutory and General
Information – E. Post-IPO Share Award Scheme.” As approved by the Board and the
Shareholders on March 8, 2025, subject to the Scheme Mandate Limit thereunder, the current
maximum number of Shares that may be issued upon vesting of all Awards to be granted under
this Post-IPO Share Award Scheme is 2,399,500 Shares.
Our Major Subsidiary
VISEN Shanghai is our major subsidiary and operating entity. Incorporated in Shanghai,
PRC on February 15, 2019, VISEN Shanghai is a wholly owned subsidiary of VISEN HK, with
a registered capital of US$113,000,000. VISEN Shanghai primarily engages in the research and
clinical development of our drug candidates.
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For details of shareholding changes of other subsidiaries within the two years
immediately preceding the date of this document, see “Appendix IV – Statutory and General
Information – A. Further Information about Our Group – 3. Changes in the share capital of our
subsidiaries.”
ACQUISITION, MERGER AND DISPOSAL
Throughout the Track Record Period and as of the Latest Practicable Date, the Company
did not conduct any acquisitions, mergers or disposals.
PRE-IPO INVESTMENTS
Overview
Our Company completed two rounds of Pre-IPO Investments, including Series A
financing and Series B financing as described above. The consideration of the Pre-IPO
Investments was determined based on arm’s length negotiations among our Founding
Shareholders, and between our Company and the Pre-IPO Investors, respectively, after taking
into account the timing of the investments and the status of our business and operating entity
at the relevant time. In connection with the Pre-IPO Investments, our Founding Shareholders
and the Pre-IPO Investors entered into the relevant share purchase agreements at the time of
their respective investments.
Capitalization of our Company
The below table is a summary of the shareholding structure of our Company:
As of the Latest Practicable Date (1) As of the Listing Date (2)
Name of Shareholders
Series A
Preferred
Shares
Series B
Preferred
Shares Shares
Aggregate
number
of Shares
Aggregate
shareholding
percentage
Aggregate
number
of Shares
Aggregate
shareholding
percentage
Ascendis Pharma
– Ascendis Pharma
Endocrinology
Division 20,000,000 568,182 – 20,568,182 20.06% 20,568,182 18.29%
– Ascendis Pharma
Growth Disorders 7,500,000 213,068 – 7,713,068 7.52% 7,713,068 6.86%
– Ascendis Pharma
Bone Diseases 12,500,000 355,114 – 12,855,114 12.54% 12,855,114 11.43%
Vivo Capital 35,000,000 1,136,364 – 36,136,364 35.24% 36,136,364 32.14%
(3)
Sofinnova 5,000,000 227,273 – 5,227,273 5.10% 5,227,273 4.65%
HongShan Growth – 4,090,909 – 4,090,909 3.99% 4,090,909 3.64%
OrbiMed
– Worldwide Healthcare
Trust PLC – 1,454,546 – 1,454,546 1.42% 1,454,546 1.29%
– OrbiMed Genesis
Master Fund, L.P . – 181,818 – 181,818 0.18% 181,818 0.16%
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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As of the Latest Practicable Date (1) As of the Listing Date (2)
Name of Shareholders
Series A
Preferred
Shares
Series B
Preferred
Shares Shares
Aggregate
number
of Shares
Aggregate
shareholding
percentage
Aggregate
number
of Shares
Aggregate
shareholding
percentage
– OrbiMed New
Horizons Master
Fund, L.P . – 181,818 – 181,818 0.18% 181,818 0.16%
Sherpa Healthcare
Partners
– Sherpa Healthcare
Fund I, L.P . – 1,363,636 – 1,363,636 1.33% 1,363,636 1.21%
– Sherpa Healthcare
Co-Investment
Fund, L.P . – 454,546 – 454,546 0.44% 454,546 0.40%
Cormorant
– Cormorant Private
Healthcare Fund
III, LP – 824,945 – 824,945 0.80% 824,945 0.73%
– Cormorant Global
Healthcare Master
Fund, LP – 248,400 – 248,400 0.24% 248,400 0.22%
– CRMA SPV , L.P . – 17,564 – 17,564 0.02% 17,564 0.02%
HBM Healthcare
Investments – 681,818 – 681,818 0.66% 681,818 0.61%
Pivotal bioV enture
Partners China – 590,909 – 590,909 0.58% 590,909 0.53%
Logos Capital – 590,909 – 590,909 0.58% 590,909 0.53%
CRF Investment – 454,545 – 454,545 0.44% 454,545 0.40%
VP EIP NUS LIMITED – – 2,375,500
(4) 2,375,500 2.32% 2,375,500 2.11%
VP EIP US LIMITED – – 1,530,000 (4) 1,530,000 1.49% 1,530,000 1.36%
VPP LU LIMITED – – 5,000,000 (4) 5,000,000 4.88% 5,000,000 4.45%
Total 80,000,000 13,636,364 8,905,500 102,541,864 100.00% 102,541,864 91.20%
Notes:
(1) Based on the assumption that the conversion of the Preferred Shares into Shares on a one-to-one basis
has been completed prior to the Listing.
(2) Calculated after taking into account the Shares to be issued pursuant to the Global Offering, assuming
that the Offer Size Adjustment Option and the Over-allotment Option are not exercised and no Shares
are issued under the Post-IPO Share Award Scheme.
(3) Vivo Capital is also a cornerstone investor of the Company and has been permitted to subscribe for such
number of shares at the Offer Price in an aggregate investment amount of US$10.0 million (or
approximately HK$77.8 million) (exclusive of brokerage, SFC transaction levy, Stock Exchange trading
fee and AFRC transaction levy). This interest excludes any Offer Shares that may be subscribed by Vivo
Capital, under the Global Offering pursuant to the cornerstone investment agreements. For more
information on this subscription, see the section headed “Cornerstone Investors”.
(4) The Shares held by each of VP EIP NUS LIMITED, VP EIP US LIMITED and VPP LU LIMITED do
not carry voting rights pursuant to the existing Memorandum and Articles of Association of our
Company.
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Principal terms of the Pre-IPO Investments and rights of our Founding Shareholders and
Pre-IPO Investors
The below table summarizes the principal terms of the Pre-IPO Investments:
Series A Financing Series B Financing
Cost per Preferred Share
(approximation)
US$1.00 US$11.00
Corresponding valuation of our
Company (approximation) (1)
US$80 million US$1,030 million
Date of the agreement(s) November 7, 2018 January 8, 2021
Funds raised by our Group
(approximation)
US$40 million (2) US$150 million
Date on which investment was
fully settled
November 7, 2018 January 9, 2021
Discount/(Premium) to the Offer
Price (3)
89.18% (19.04)% (4)
Lock-up Period For details of lock-up arrangements in
respect of all of our Pre-IPO Investors, please
refer to the subsection headed “Underwriting
— Underwriting Arrangements and Expenses
— Hong Kong Public Offering —
Undertakings to the Stock Exchange pursuant
to the Listing Rules — Lock-up Undertakings
of All Existing Shareholders” in this
prospectus.
Use of Proceeds from
the Pre-IPO Investments
We utilized the proceeds for the principal
business of our Group as approved by the
Board, including, but not limited to, R&D
activities, the growth and expansion of our
Group’s business and general working capital
purposes in accordance with the budget
approved by the Board. As at the Latest
Practicable Date, approximately 86.1% of the
net proceeds from the Pre-IPO Investments
have been utilized. We intended to use the
rest net proceeds from the Pre-IPO
investment for further research and
development activities, working capital, and
other general corporate purposes.
Strategic benefits of
the Pre-IPO Investments
At the time of the Pre-IPO Investments, our
Directors were of the view that our Company
could benefit from the capital that would be
provided by the investors’ investments in our
Company and the investors’ knowledge and
experience.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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Notes:
(1) The corresponding valuation of our Company is calculated based on the capitalization of our Company
of the relevant time taking into account the funds raised without taking into account the Shares issued
pursuant to the Equity Incentive Plan after the Series B Financing. The valuation of the Company
increased significantly during the period between our Series A Financing and Series B Financing,
primarily due to (i) the continuous and successful building of our management and operation team; (ii)
the R&D and regulatory milestones achieved by us on our Core Product, lonapegsomatropin, including
IND approval to initiate the Phase 3 pivotal study of the Core Product in PGHD and initiation of this
study; and (iii) the R&D and regulatory milestones achieved by us on another key drug candidate,
TransCon CNP (navepegritide), including IND approval to initiate the China Phase 2 trial.
(2) 40,000,000 Series A Preferred Shares were allotted and issued to Ascendis Pharma as consideration for
entering into the Exclusive License Agreements and Clinical Supply Agreements.
(3) The premium to the Offer Price is calculated based on the assumption that the Offer Price is HK$71.86
per Share, being the mid-point of the indicative Offer Price range of HK$68.44 to HK$75.28, assuming
the conversion of the Preferred Shares into Shares on a one-to-one basis has completed prior to Listing.
(4) Calculated on the basis of the Offer Price of HK$71.86, the mid-point of the proposed range of
HK$68.44 to HK$75.28, the valuation of the Company upon Listing will be decrease from that of Series
B Financing, which is mainly due to market fluctuations which reflects market variability and broader
economic conditions which influenced investor sentiment and valuation metrics. The biotech industry
is particularly sensitive to short-term market dynamics due to the lengthy and costly nature of drug
development, as well as shifts in regulatory landscapes and healthcare policies. However, these factors
do not affect the Company’s long-term potential and market prospects. Between the Series B financing
and the Latest Practicable Date, the Company has achieved various milestones, including (i) the
acceptance of the BLA filing of our Core Product for the treatment of PGHD by the NMPA, (ii) the
completion of the primary analysis of the Phase 2 clinical trial in China of TransCon CNP
(navepegritide) for the treatment of ACH with the primary endpoint met according to the topline results,
and (iii) the completion of the double-blind period for primary endpoint for our ongoing China Phase
3 pivotal trial of palopegteriparatide, PaTHway China Trial, which demonstrates consistency with the
global Phase 3 pivotal trial in terms of primary endpoint and safety profile.
Special Rights of the Founding Shareholders and Pre-IPO Investors
Pursuant to the Shareholders’ Agreement and the existing Memorandum and Articles of
Association of our Company, certain of our Founding Shareholders and the Pre-IPO Investors
have, among other rights, (i) information and inspection rights; (ii) the right to elect Directors
and the right of participation in the meetings of the Board; (iii) the right to appoint observers
to attend the meetings of the Board; (iv) pre-emptive rights; (v) rights of first refusal and
co-sale; (vi) conversion rights; (vii) liquidation preference; and (viii) protective provisions.
Pursuant to the Shareholders’ Agreement, all Preferred Shares shall be converted into
Shares of our Company immediately before the completion of the Global Offering on a
one-to-one ratio, and all the above shareholders’ special rights granted to the Pre-IPO Investors
will be automatically terminated upon or before the Listing.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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Information about our Shareholders
The background information of our Founding Shareholders and Pre-IPO Investors is set
out below:
Founding Shareholders
Ascendis Pharma
Ascendis Pharma Endocrinology Division, Ascendis Pharma Growth Disorders and
Ascendis Pharma Bone Diseases are wholly-owned subsidiaries of Ascendis Pharma A/S, a
Danish-based biopharmaceutical company listed on the Nasdaq (Ticker Symbol: ASND). None
of the shareholders of Ascendis Pharma A/S holds over 30% equity interest in it. For further
details of Ascendis Pharma A/S, please see the section headed “Relationship with the
Controlling Shareholders” in this document.
Vivo Capital
Vivo Plenilune IX Limited (“Vivo Capital”) is a company established under the Laws of
Cayman Islands. Vivo Capital is a wholly-owned subsidiary of Vivo Capital Fund IX
(Cayman), L.P ., which is in turn controlled by its general partner, Vivo Capital IX (Cayman),
LLC. (collectively, “Vivo Funds”). As of the Latest Practicable Date, Vivo Capital Fund IX
(Cayman), L.P . has over 40 limited partners, among which the largest limited partner held less
than 20% of its partnership interest. Vivo Capital IX (Cayman), LLC’s managing members are
Frank Kung, Ed Engleman and Fu Shan. Other than Fu Shan who is a Director of our Company,
each of the voting members of Vivo Capital IX (Cayman), LLC. is an Independent Third Party.
Vivo Funds are under the management of Vivo Capital LLC. Founded in 1996, Vivo
Capital LLC provides a multi-fund investment platform, covering private equity including
buyout, venture capital, and public equity. Funds managed by Vivo Capital LLC invest broadly
in healthcare across all fund strategies, including biotechnology, pharmaceuticals, medical
devices, and healthcare services, with a focus on the largest healthcare markets.
Vivo Capital is a Sophisticated Investor by virtue of the investment experience and size
of assets under management of Vivo Capital LLC. As of December 31, 2023, Vivo Capital is
a leading healthcare investment firm with approximately US$5.8 billion in assets under
management. Portfolio companies of Vivo Capital include, but are not limited to, TOT
BIOPHARM International Company Limited (ʮ̡) (HKEx: 1875),
InnoCare Pharma Limited (ʮ̡) (HKEx: 9969), Lepu Biopharma Co., Ltd.
(ʮ̡) (HKEx: 2157) and LEPU ScienTech Medical Technology
(Shanghai) Co., Ltd. (Ҧ(ɪऎ)ʮ̡) (HKEx: 2291). For further
details of Vivo Capital, please see the section headed “Relationship with the Controlling
Shareholders” in this document.
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Sofinnova
Sofinnova V enture Partners IX, L.P . (“Sofinnova”), is a limited partnership established
under the laws of the State of Delaware, with Sofinnova Management IX, L.L.C. (“Sofinnova
GP”) as its general partner. Sofinnova GP is controlled by its sole managing member, James
I. Healy, MD, PhD. Dr. Healy is currently on the board of directors of Bolt Therapeutics, Inc.
(Nasdaq: BOLT), ArriV ent BioPharma, Inc. (Nasdaq: A VBP), Y -mAbs Therapeutics, Inc.
(Nasdaq: YMAB) and Natera, Inc. (Nasdaq: NTRA), and on the board of directors of several
private companies. He holds an M.D. and a Ph.D. in Immunology from Stanford University
School of Medicine and holds a B.A. in Molecular Biology and a B.A. in Scandinavian Studies
from the University of California, Berkeley. As of December 31, 2023, Sofinnova is a fund
with $510 million in capital commitments and managed and advised by Sofinnova Investments,
Inc., a registered investment adviser regulated by the U.S. Securities and Exchange
Commission under the Investment Advisers Act of 1940. As of December 31, 2023, Sofinnova
had 51 limited partners consisting mainly of endowment and foundations, family offices,
insurance and institutions, pension funds and private funds. Among these limited partners, the
largest limited partner held less than 10% of the aggregate partnership interests. Sofinnova is
a clinical-stage focused biopharmaceutical investment fund and invests in both private and
public equity of therapeutics-focused companies. Its portfolio companies include Natera, Inc.
(Nasdaq: NTRA) and NextCure Inc (Nasdaq: NXTC). Sofinnova is a Sophisticated Investor. To
the best knowledge of our Directors, save as disclosed in this prospectus, each of the
abovementioned entities is an Independent Third Party.
Pre-IPO Investors
HongShan Growth
HSG Growth VI Holdco F LTD. (“HongShan Growth”) is a company incorporated in the
Cayman Islands and is a wholly-owned subsidiary of HongShan Capital Growth Fund VI, L.P .
(“HongShan GVI Fund”). HongShan GVI Fund is an investment fund whose primary purpose
is to make equity investments in private companies. The general partner of HongShan GVI
Fund is HSG Growth VI Management, L.P ., whose general partner is HSG Holding Limited,
a wholly-owned subsidiary of SNP China Enterprises Limited. Neil Nanpeng Shen is the sole
shareholder of SNP China Enterprises Limited. None of the limited partners of HongShan GVI
Fund has more than 30% of the limited partnership interests of HongShan GVI Fund. To the
best knowledge of our Directors, save as disclosed in this prospectus, each of HongShan
Growth, the abovementioned entities and Neil Nanpeng Shen is an Independent Third Party.
HongShan Growth is a Sophisticated Investor by virtue of the investment experience of
HongShan GVI Fund. As of December 31, 2024, HongShan Growth managed approximately
US$375 million of assets. HongShan is a leading venture capital and private equity firm
investing across technology, healthcare and consumer sectors. Since its founding in 2005,
HongShan has nurtured entrepreneurship and innovation, backing more than 1,500 companies.
Investment funds affiliated with HongShan have invested in other technology, biotechnology
or healthcare companies such as CStone Pharmaceuticals ( ਿͩᖹุ) (HKEx: 2616), Innovent
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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Biologics, Inc. (Ⴁᖹ) (HKEx: 1801), V enus Medtech (Hangzhou) Inc. (ᔼᐕ
ʮ̡) (HKEx: 2500), Brii Biosciences Limited (ʮ̡)
(HKEx: 2137), Jiangsu Recbio Technology Co., Ltd. (ʮ̡)
(HKEx: 2179), Beijing Fourth Paradigm Technology Co., Ltd. (΅Ϟ
ʮ̡) (HKEx: 6682).
OrbiMed
Worldwide Healthcare Trust PLC (“WWH”) is a publicly-listed investment trust
organized under the laws of England. WWH is listed on the London Stock Exchange (LON:
WWH).
OrbiMed Genesis Master Fund, L.P . (“GEN”) is an exempted limited partnership
organized under the laws of the Cayman Islands. It is a pooled-investment fund with OrbiMed
Advisors LLC acting as its investment manager and OrbiMed Genesis GP LLC as its general
partner. OrbiMed Advisors LLC is the managing member of OrbiMed Genesis GP LLC. As of
December 31, 2024, GEN has 114 limited partners with the largest single investor holding
approximately 10.7% interest in GEN.
OrbiMed New Horizons Master Fund, L.P . (“ONH”) is an exempted limited partnership
organized under the laws of the Cayman Islands. It is a pooled-investment fund with OrbiMed
Advisors LLC acting as its investment manager and OrbiMed New Horizons GP LLC as its
general partner. OrbiMed Advisors LLC is the managing member of OrbiMed New Horizons
GP LLC. As of December 31, 2024, ONH has 83 limited partners with the largest single
investor holding approximately 18.1% interest in ONH.
WWH, GEN, and ONH are investment vehicles of OrbiMed. OrbiMed Capital LLC is the
portfolio manager of WWH. OrbiMed Advisors LLC is the investment manager of GEN and
ONH. OrbiMed Capital LLC and OrbiMed Advisors LLC exercise voting and investment
power through a management committee comprised of Carl L. Gordon, Sven H. Borho, and W.
Carter Neild.
OrbiMed is a Sophisticated Investor. As of December 2024, OrbiMed is a leading
healthcare investment firm with approximately US$17 billion in assets under management.
OrbiMed invests globally in the healthcare sector with investments ranging from early stage
private companies to large multinational corporations.
To the best knowledge of our Directors, save as disclosed in this prospectus, each of the
abovementioned entities is individually considered an Independent Third Party.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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Sherpa Healthcare Partners
Sherpa Healthcare Fund I, L.P . is a limited partnership established under the laws of the
Cayman Islands, with Sherpa Healthcare Fund I, GP , Ltd. acting as its general partner. Sherpa
Healthcare Co-Investment Fund, L.P . is a limited partnership established under the laws of the
Cayman Islands, with Sherpa Healthcare Co-Investment GP Ltd. acting as its general partner.
Each of the Sherpa Healthcare Partners is ultimately controlled by Mr. Cai Daqing. As of the
Latest Practicable Date, Sherpa Healthcare Partners have over 20 limited partners mainly
including family offices, foundations, asset managements, public listed companies, fund of
funds, and pension funds. To the best knowledge of our Directors, save as disclosed in this
prospectus, each of the abovementioned entities and Mr. Cai Daqing is an Independent Third
Party.
Together with its affiliates, Sherpa Healthcare Partners are specializing in investments in
the healthcare sector, including biotech, pharmaceuticals, medical devices, equipment and
diagnostics, healthcare services and healthcare-related information technology and mobile
technology companies, all having a nexus to greater China. The portfolio companies of Sherpa
Healthcare Partners include Shanghai HeartCare Medical Technology Corporation Limited
(HKEx: 6609), CYTEK BIOSCIENCES, INC. (Nasdaq: CTKB). Considering its extensive
investment experience in the healthcare industry and its significant commitment to the
healthcare section, Sherpa Healthcare Partners is a Sophisticated Investor.
Cormorant
Cormorant Global Healthcare Master Fund, LP and CRMA SPV , L.P . are exempt limited
partnerships incorporated under the laws of Cayman Islands as pooled investment vehicles
organized as a hedge fund and a special purpose vehicle, respectively. Cormorant Private
Healthcare Fund III, LP , a limited partnership incorporated under the laws of Delaware, is a
pooled investment vehicle organized as a private equity fund. All three entities are managed by
Cormorant Asset Management, LP , an investment advisor registered with the U.S. Securities
and Exchange Commission, which is controlled by Ms. Chen Bihua. Founded in 2013 by Ms.
Chen Bihua, Cormorant manages approximately US$3.5 billion of assets across private and
public companies, focusing on innovative biotech, medtech and life science companies.
Cormorant has invested in a number of biotechnology or healthcare companies including but
not limited to New Horizon Health Limited (6606.HK), Innovent Biologics, Inc. (1801.HK),
Kangji Medical Holdings Limited (9997.HK) and Hansoh Pharmaceutical Group Company
Limited (3692.HK). To the best knowledge of our Directors, save as disclosed in this
prospectus, each of the abovementioned entities and Ms. Chen Bihua is an Independent Third
Party. Cormorant provides investment advisory services on discretionary basis.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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HBM Healthcare Investments
HBM Healthcare Investments (Cayman) Ltd. or HBM Healthcare Investments, is a
company established under the laws of Cayman Islands and is a wholly-owned subsidiary of
HBM Healthcare Investments Ltd. HBM Healthcare Investments holds and manages an
international portfolio of promising companies in the human medicine, biotechnology, medical
technology and diagnostics sectors and related areas. HBM Healthcare Investments Ltd is
listed on SIX Swiss Exchange (ticker: HBMN), with USD 2.0 billion net assets, and has an
international shareholder base. To the best knowledge of our Directors, save as disclosed in this
prospectus, each of the abovementioned entities is an Independent Third Party. HBM
Healthcare Investments is operating on a “discretionary basis.” The board of directors of HBM
Healthcare Investments (Cayman) Ltd. has sole voting and investment power with respect to
the Shares held by HBM Healthcare Investments (Cayman) Ltd. The board of directors of HBM
Healthcare Investments (Cayman) Ltd. is comprised of Jean-Marc Lesieur, Richard Coles,
Sophia Harris, Dr. Andreas Wicki, Paul Woodhouse and Mark Kronenfeld, none of whom has
individual voting or investment power with respect to such Shares, and each disclaims
beneficial ownership of such Shares except to the extent of any pecuniary interest therein.
Pivotal bioV enture Partners China
Cosmic Clover Limited is an investment holding company incorporated in the BVI and
is a subsidiary of Pivotal bioV enture Partners China USD Fund I, L.P . (“Pivotal bioV enture
Partners China”, an exempted limited partnership registered in the Cayman Islands). The
Ultimate General Partner of Pivotal bioV enture Partners China is Pivotal bioV enture Partners
China USD Fund I U.G.P . Limited which is an indirect subsidiary of Nan Fung International
Holdings Limited (“Nan Fung”). As of the Latest Practicable Date, Pivotal bioV enture Partners
China had four limited partners with Pivotal China Partners Limited, which is its largest
limited partner, holding approximately 97% of its partnership interest. Pivotal China Partners
Limited is an indirect subsidiary of Nan Fung Life Sciences Holdings Limited (“NFLS”).
Portfolio companies of NFLS include, but are not limited to, InnoCare Pharma Limited ( ፕ༐
ʮ̡) (HKEx: 9969), Wuxi Apptec Co., Ltd. (ʮ
̡) (HKEx: 2359), Arcutis Biotherapeutics Inc (NASDAQ: ARQT), V axcyte (NASDAQ:
PCVX), and Recursion Pharmaceuticals Inc (NASDAQ: RXRX).
The principal activities of Nan Fung and its subsidiaries (collectively, “Nan Fung Group”)
include property investment and development, life sciences investment, financial investments,
property management and construction. Nan Fung Group has been developing properties in
Hong Kong since 1965 and since then, Nan Fung Group has invested in commercial and
residential projects in other jurisdictions including the PRC, Macau, Singapore, Japan,
Malaysia, the United Kingdom and the United States. Nan Fung Group has set up NFLS as a
global life sciences investment platform, investing across the entire value chain of the life
sciences industry. NFLS aspires to be the ideal partner for scientists, entrepreneurs,
corporations and investors in the life sciences spectrum. Supported by the Group’s solid
financial strength and investing expertise, NFLS has built teams and established significant
presences in Hong Kong, Mainland China and the US. which holds diverse portfolios of the life
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
– 233 –


--- page 244 ---
sciences industry including therapeutics, medical devices, diagnostics, tools, and healthcare
services. As of the Latest Practicable Date, it managed the committed capital of approximately
US$2.5 billion. The ultimate holding company of Nan Fung Group is Chen’s Group
International Limited, which is wholly owned by the estate of the late Dr. Chen Din Hwa, a
Hong Kong industrial tycoon. To the best knowledge of our Directors, save as disclosed in this
prospectus, each of the abovementioned entities and Dr. Chen Din Hwa is an Independent Third
Party.
Logos Capital
Logos Opportunities Fund II LP is a limited partnership established under the Laws of the
State of Delaware, with Logos Opportunities GP LLC acting as its general partner, whose
ultimate beneficiary owners are Independent Third Parties. Logos Global Management LP
(“Logos Capital”) is the Investment Adviser to Logos Opportunities Fund II LP (collectively,
“Logos”). As of the Latest Practicable Date, Logos Opportunities Fund II LP has over 50
limited partners, mainly including family offices, foundations and fund of funds with the
largest single investor holding lower than 15% of the shares. Logos is a biotechnology-focused
investment firm which combines scientific and financial expertise with in-house clinical trial
analytics to identify transformative therapies in healthcare. To the best knowledge of our
Directors, save as disclosed in this prospectus, each of the abovementioned entities is an
Independent Third Party.
CRF Investment
CRF is a limited liability company incorporated under the laws of the Cayman Islands.
CRF is wholly-owned by China Reform Conson Soochow Overseas Fund I L.P ., which is a
China-related overseas investment firm specializing in high-end manufacturing and healthcare
sectors with totaled US$450 million Fund size.
China Reform Conson Soochow Overseas Fund I L.P . is solely advised by CDG Capital
Company Limited (“CDG Capital”, ોᏊ༟͉), and mainly sponsored by China Reform
Holdings Corporation Ltd (“CRHC”) (through China Reform Investment Fund I L.P .), Qingdao
Conson Development (Group) Co., Ltd. (through its wholly-owned subsidiary) and Soochow
Securities Co., Ltd. (through its wholly-owned subsidiary). The General Partner of China
Reform Conson Soochow Overseas Fund I L.P . is China Reform Puissance Overseas GP LP , an
exempted limited partnership incorporated under the laws of the Cayman Islands. CRF
provides investment advisory services on discretionary basis.
To the best knowledge of our Directors, save as disclosed in this prospectus, CRF
Investment Holdings Company Limited is an Independent Third Party.
Save as disclosed above and to the best knowledge of our Directors, our Pre-IPO
Investors and their ultimate beneficial owners are Independent Third Parties.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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Public Float
Upon completion of the Global Offering (assuming the Offer Size Adjustment Option and
the Over-allotment Option are not exercised and no Shares are issued under the Post-IPO Share
Award Scheme), Ascendis Pharma A/S and Vivo Capital, will hold (directly or indirectly)
approximately 36.58% and 33.15% of the total issued Shares (including the Shares that may be
subscribed by Vivo Capital under the Global Offering), respectively, and each is therefore our
core connected person under the Listing Rules. As a result, such Shares will not count towards
the public float. In addition, the Shares held by VPP LU LIMITED (a special purpose vehicle
wholly owned by a family trust established by Mr. Lu An-bang (as the settlor)), representing
approximately 4.45% of the total issued Shares, will not be counted towards the public float.
Except as disclosed above, Shares held by Sofinnova, other Pre-IPO Investors, VP EIP
NUS LIMITED, VP EIP US LIMITED, the special purpose vehicles wholly owned by PRC
Employee Trust and U.S. Employee Escrow for the purpose of reserving for vesting of awards
under the Equity Incentive Plan and the Offer Shares in the Global Offering will be counted
towards the public float for the purpose of Rule 8.08 of the Listing Rules after the Global
Offering. Hence, 25.87% of our Company’s total issued Shares will be held by the public upon
completion of the Global Offering as required under Rule 8.08(1)(a) of the Listing Rules that
requires more than 25% of the Company’s total issued shares must be held by the public upon
the completion of the Global Offering. In addition, the market capitalization of the portion of
the total number of the Company’s issued Shares held by the public pursuant to the
requirements under Rule 18A.07 of the Listing Rules (based on the Offer Price of HK$71.86,
being the mid-point of the indicative Offer Price range) would be over HK$375 million at the
time of the Listing.
Compliance with the Guide for New Listing Applicants
The Joint Sponsors confirm that the investments by our Founding Shareholders and the
Pre-IPO Investors are in compliance with Chapter 4.2 of the Guide for New Listing Applicants
issued by the Stock Exchange.
PRC REGULATORY REQUIREMENTS
Our PRC Legal Adviser confirms that as of the Latest Practicable Date, VISEN Shanghai
and VISEN Suzhou had been duly established as wholly foreign owned enterprises and all
regulatory approvals and permits in respect of the incorporation of VISEN Shanghai and
VISEN Suzhou had been obtained in accordance with PRC laws.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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Under the Mergers and Acquisitions of Domestic Enterprises by Foreign Investors ( ᗫ
) (“M&A Rules”), a foreign investor is required to obtain
necessary approvals from MOFCOM or the department of commerce at the provincial level
when:
 a foreign investor acquires equity in a domestic enterprise (thereby converting it into
a foreign-invested enterprise), or subscribes for new registered capital in a domestic
enterprise via an increase of registered capital (thereby converting it into a
foreign-invested enterprise); or
 a foreign investor establishes a foreign-invested enterprise that purchases and
operates assets of a domestic enterprise, or that purchases assets of a domestic
enterprise and injects those assets to establish a foreign-invested enterprise.
Furthermore, according to Article 11 of the M&A Rules, where a domestic company or
enterprise, or a domestic natural person, through an overseas company established or
controlled by it/them, acquires a domestic company that is related to or connected with it/them,
an approval on such connected transaction from MOFCOM is required.
As advised by our PRC Legal Adviser, the MOFCOM approvals under the M&A Rules are
not required because VISEN Shanghai and VISEN Suzhou was incorporated as a foreign-
invested enterprise without involving acquisition of the equity or assets of a “PRC domestic
company”, as such term is defined under the M&A Rules. However, there is uncertainty as to
how the M&A Rules will be interpreted or implemented and whether the MOFCOM and other
related Governmental Authorities would promulgate future PRC laws, regulations or rules
contrary to the M&A Rules.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 247 ---
OUR CORPORATE STRUCTURE IMMEDIATELY PRIOR TO THE GLOBAL OFFERING
The following chart depicts our corporate and shareholding structure as at the Latest Practicable Date, assuming that all of the Preferred Shares
have been converted to ordinary Shares on a one-to-one basis, the Offer Size Adjustment Option and the Over-allotment Option are not exercised,
and no Shares are issued under the Post-IPO Share Award Scheme: Company
(Cayman Islands)
100% 100%
Ascendis
Pharma(1)
Vivo
Capital(2) Sofinnova HongShan
Growth
OrbiMed Sherpa
Healthcare
Partners
Cormorant
HBM
Healthcare
Investments
Pivotal
bioVenture
Partners
China
Logos
Capital
CRF
Investment
40.12% 35.24% 5.10% 3.99% 1.77% 1.77% 1.06% 0.66% 0.58% 0.58% 0.44%
VP
EIP
NUS
Limited(3)
2.32%
VP
EIP
US
Limited(4)
1.49%
VPP
LU
Limited(5)
4.88%
VISEN HK
(Hong Kong)
VISEN BVI
(BVI)
100%
VISEN Taiwan
(Taiwan)
VISEN Shanghai
(PRC)
VISEN Suzhou
(PRC)
Offshore
Onshore
100% 100%
Notes:
(1) Ascendis Pharma A/S, through its wholly-owned subsidiaries, Ascendis Pharma Endocrinology Division, Ascendis Pharma Bone Diseases and Ascend is Pharma Growth
Disorders, collectively, hold an aggregate of 40,000,000 Series A Preferred Shares and 1,136,364 Series B Preferred Shares of the Company prior to th e Listing.
(2) Vivo Capital holds an aggregate of 35,000,000 Series A Preferred Shares and 1,136,364 Series B Preferred Shares of the Company prior to the Listing .
(3) VP EIP NUS LIMITED is a special purpose vehicle wholly owned by the PRC Employee Trust of which the trustee is Tricor HK. The PRC Employee Trust is esta blished as
reserve for grant or vesting of awards under the Equity Incentive Plan which have been or may be granted to employees and consultants of PRC Nationality . Tricor HK is an
Independent Third Party.
(4) VP EIP US LIMITED is a special purpose vehicle wholly owned by the U.S. Employee Escrow of which the trustee is Tricor HK. The U.S. Employee Escrow is e stablished
as reserve for grant or vesting of RSUs under the Equity Incentive Plan which have been or may be granted to employees and consultants of U.S. Nationalit y.
(5) VPP LU LIMITED is a special purpose vehicle wholly owned by a family trust established by Mr. LU An-bang (as the settlor) of which the trustee is Trico r Equity Trustee
Limited for the benefit of, among others, Mr. LU An-bang and his family members. Tricor Equity Trustee Limited is an Independent Third Party.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 248 ---
OUR CORPORATE STRUCTURE IMMEDIATELY FOLLOWING THE GLOBAL OFFERING
The following chart depicts our corporate and shareholding structure immediately following the completion of the Global Offering, assuming
that all of the Preferred Shares have been converted to Shares on a one-to-one basis, the Offer Size Adjustment Option and the Over-allotment Option
are not exercised, and no Shares are issued under the Post-IPO Share Award Scheme:
Company
(Cayman Islands)
100% 100%
VISEN HK
(Hong Kong)
VISEN BVI
(BVI)
VISEN Shanghai
(PRC)
Offshore
Onshore
CRF
InvestmentCormorant
Sherpa
Healthcare
Partners
OrbiMedHongShan
GrowthSofinnovaVivo
Capital(2)(6)
Ascendis
Pharma(1)
Pivotal
bioVenture
Partners
China
Logos
Capital
HBM
Healthcare
Investments
Investors
Participating
in the
Global
Offering
VP
EIP
NUS
Limited(3)
VP
EIP
US
Limited(4)
VPP
LU
Limited(5)
100%
VISEN Taiwan
(Taiwan)
VISEN Suzhou
(PRC)
100% 100%
2.11% 1.36% 4.45% 8.80%0.40%0.53% 0.53%0.61%0.97%1.62%1.62%3.64%4.65%32.14%36.58%
Notes (1)-(5): see the preceding page for the notes
(6) Vivo Capital is also a cornerstone investor of the Company and has been permitted to subscribe for such number of shares at the Offer Price in an aggre gate investment amount
of US$10.0 million (or approximately HK$77.8 million) (exclusive of brokerage, SFC transaction levy, Stock Exchange trading fee and AFRC transacti on levy). This interest
excludes any Offer Shares that may be subscribed by Vivo Capital under the Global Offering pursuant to the cornerstone investment agreements. For mor e information on this
subscription, see the section headed “Cornerstone Investors”.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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The information presented in this section is derived from various government
publications and other publicly available sources. We believe that the sources of such
information are appropriate and we have taken reasonable care in extracting and
reproducing such information. We have no reason to believe that such information is false
or misleading or that any fact has been omitted that would render such information false
or misleading in any material respect. The information included herein has not been
independently verified by our Company, the Joint Sponsors, Joint Global Coordinators,
the Overall Coordinators, and Joint Bookrunners, the Underwriters, any of our or their
respective directors, officers or representatives or any other person or party involved in
the Global Offering, and no representation is given as to its accuracy, completeness or
fairness of such information. The information and statistics may not be consistent with
other information and statistics compiled within or outside of China. Statistical data in
these publications and sources also include estimates and future projections based on a
number of assumptions. If any one or more of the assumptions underlying the market data
are later found to be inaccurate, actual results may differ from the projections based on
these assumptions. Accordingly, such information should not be unduly relied upon.
OVERVIEW
We are a late-stage, near-commercialization biopharmaceutical company focused on
providing treatments in selected endocrinology diseases in China (including Hong Kong,
Macau and Taiwan).
Our Core Product. Our Core Product, lonapegsomatropin, is a drug candidate studied by
us to treat children aged 3 to 17 years old with GHD in a completed Phase 3 pivotal trial in
China, where each subject received treatment for 52 weeks. Lonapegsomatropin is the only
LAGH that has demonstrated superior efficacy and comparable safety in active-controlled and
parallel-group trial comparisons with daily hGH, as validated in the completed Phase 3 pivotal
trial in China. In this trial, lonapegsomatropin was associated with an AHV of 10.66 cm/year
at 52 weeks compared to 9.75 cm/year for daily hGH, with a p-value of 0.0010. Height SDS
at 52 weeks increased over baseline by 1.01 for lonapegsomatropin and by 0.83 for daily hGH,
with a p-value of 0.0015, and statistical significance of change in height SDS from baseline ( /H9004
height SDS) was demonstrated in the lonapegsomatropin group from and including 13 weeks
onwards. The published results of the trial has demonstrated consistency with the completed
global Phase 3 pivotal trial, which supported the marketing approvals from the FDA and the
EMA in PGHD and demonstrated lonapegsomatropin’s superior growth profile and comparable
safety profile in comparison with daily hGH. On March 7, 2024, the BLA filing of our Core
Product for the treatment of PGHD was accepted by the NMPA.
Lonapegsomatropin provides a convenient once-weekly dosing regimen in injection
frequency as compared to once-daily hGH, which may foster increased dosing compliance for
pediatric patients in daily lives. As a result, it has the potential to further improve treatment
outcomes and duration over daily hGH in real-world settings. Leveraging its novel molecular
design, our Core Product is the only LAGH that releases unmodified hGH in vivo in between
weekly doses in a stable manner, offering our Core Product the first-mover advantage in
unmodified LAGH treatments. Such unmodified hGH is identical in the molecular composition
to the endogenous growth hormone secreted by pituitary gland and preserves its original mode
of action.
BUSINESS
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Overview of endocrinology . Endocrinology is a large therapeutic area spanning over 170
diseases, among which 79, or nearly half, still lack disease-specific drugs, indicating
significant unmet medical needs. Endocrine diseases may occur at all ages, affecting newborn
to elderly patients, and are often associated with significant disease and socioeconomic burden
and require life-long treatment.
Pediatric and adult endocrinology . By age of onset, endocrine diseases can be
categorized into pediatric endocrine diseases and adult endocrine diseases, with each group
having its unique characteristics. Pediatric patients, as growing individuals, have special needs
related to growth and development, and hence they often face a limited treatment window and
an urgent need for timely treatment. Discomfort and pain in treatment may affect children’s
compliance, calling for significant demand to develop convenient treatment options with
simplified drug regimens and improved treatment experience. Adult endocrine disorders often
require life-long treatment, creating significant needs for treatment options with reduced
compliance burden and favorable long-term safety profile.
Market potential . The endocrine drugs market in China excluding diabetes is estimated to
grow to RMB74.2 billion by 2030, at a CAGR of 19.9% from 2023, according to Frost &
Sullivan. Notably, the growth rate of this market in China has been and is expected to continue
to be significantly higher than the growth rates of such market globally during the same
periods, driven by a combination of factors, including innovation in endocrine drugs,
increasing patient pool, improving health awareness and favorable healthcare policies.
Favorable healthcare policies . Endocrine diseases are designated, by the PRC State
Council, as a category of chronic diseases that is of high national priority. Furthermore, the
“Healthy China Action (2019-2030)” ( ਄ੰʕ਷Бਗ(2019-2030 ϋ)) announced a national
goal to reduce the rate of stunting in children aged under five from 8.1% in 2013 to below 7%
by 2022 and below 5% by 2030, highlighting China’s focus on promoting children’s health and
encouraging the development of pediatric drugs. See “Industry Overview – Overview of
Non-Diabetic Endocrine Drug Market – Favorable Healthcare Policies” for more details.
Late-stage assets in China . Leveraging our clinical development capabilities, we provide
patients in China (including Hong Kong, Macau and Taiwan) with access to the following
endocrine solutions: (i) our Core Product, lonapegsomatropin, has completed the Phase 3
pivotal trial on human subjects in China for the treatment of PGHD; the BLA filing was made
on January 18, 2024 and was subsequently accepted by the NMPA on March 7, 2024; (ii)
TransCon CNP (navepegritide) has completed the double-blind period of Phase 2 clinical trial
in China for the treatment of ACH and the last patient last visit of open-label extension
(“OLE”) period of this trial was completed in April 2024; and (iii) palopegteriparatide is
currently undergoing development in a Phase 3 pivotal trial in China for the treatment of adult
patients with HP; it has completed the double-blind period in January 2023, and the expected
NDA filing to the NMPA will be in 2025. See below and “– Our Drug Pipeline” for further
details.
BUSINESS
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Pipeline . Below is a pipeline diagram setting forth our drug candidates:
Drug Candidate* Indication
Clinical Development and Regulatory Status
IND Phase 1 Phase 2 Phase 3 BLA / NDA
Upcoming
Milestones of
Trials Conducted
by VISEN
Pediatric Endocrinology
Adult
Endocrinology
Hypoparathyroidism
Expected NDA
submission
to the NMPA
in 2025
Palopegteriparatide+ Ongoing China Phase 3 pivotal trial,
double-blind period completed in January 2023(3)
Achondroplasia
Expected NDA
submission to
the NMPA
TransCon CNP
(navepegritide)+ Ongoing China Phase 2 trial,
double-blind period completed in November 2023(2)
Core Product Key drug candidates+ +
Pediatric
Growth
Hormone
Deficiency
Lonapegsomatropin Completed China Phase 3 pivotal trial in April 2022
(BLA accepted by the NMPA in March 2024)(1)
Expected BLA
approval date
in the second half
of 2025
* VISEN has gained exclusive licensed rights to develop, manufacture and commercialize all drug candidates in
endocrinology in China (including Hong Kong, Macau and Taiwan).
Notes:
(1) VISEN completed the Phase 3 pivotal trial of lonapegsomatropin in China for the treatment of PGHD in April
2022 which met its primary endpoint according to our published results. We made the BLA filing with the
NMPA on January 18, 2024 for our Core Product for the treatment of PGHD, which was subsequently accepted
by the NMPA on March 7, 2024.
(2) The primary analysis of the double-blind period of the Phase 2 clinical trials of TransCon CNP (navepegritide)
in China for the treatment of ACH was completed in November 2023, with primary endpoint met according
to the topline results. We became the sole sponsor for the OLE period of this trial in January 2023 and the last
patient last visit of the OLE period was completed in April 2024.
(3) VISEN completed the primary analysis of the Phase 3 pivotal trial of palopegteriparatide in China for the
treatment of adult HP in January 2023 which met its primary efficacy and key secondary endpoints according
to its topline data.
 Lonapegsomatropin , our Core Product, is a drug candidate studied by us to treat
children aged 3 to 17 years old with GHD in a completed Phase 3 pivotal trial in
China, where each subject received treatment for 52 weeks. We in-licensed
lonapegsomatropin from Ascendis Pharma in November 2018. Prior to our in-
licensing, lonapegsomatropin had been studied by Ascendis Pharma in over 300
children with GHD across three Phase 3 programs. Lonapegsomatropin is the only
LAGH that has demonstrated superior efficacy and comparable safety in active-
controlled and parallel-group trial comparisons with daily hGH, as validated in the
completed Phase 3 pivotal trial in China. In this trial, lonapegsomatropin was
associated with an AHV of 10.66 cm/year compared to 9.75 cm/year for daily hGH
at 52 weeks, with a p-value of 0.0010. Height SDS at 52 weeks increased over
baseline by 1.01 for lonapegsomatropin and by 0.83 for daily hGH, with a p-value
of 0.0015, and statistical significance of change in height SDS from baseline ( /H9004
height SDS) was demonstrated in the lonapegsomatropin group from and including
13 weeks onwards. The published results of the trial has demonstrated consistency
with the completed global Phase 3 pivotal trial, which supported the marketing
approvals from the FDA and the EMA in PGHD and demonstrated
lonapegsomatropin’s superior growth profile and comparable safety profile in
comparison with daily hGH.
BUSINESS
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Leveraging its novel molecular design, lonapegsomatropin is the only LAGH that
releases unmodified hGH in vivo consistently in between weekly doses, offering our
Core Product the first-mover advantage in unmodified LAGH treatments. Such
unmodified hGH is identical in the molecular composition to the endogenous growth
hormone secreted by pituitary gland and preserves its original mode of action. This
is in distinction to other LAGH therapies under development and/or in commercial
use in China, where the active components are modified proteins or peptides that
may potentially alter the potency of hGH, its PK or PD profiles, tissue penetration
and receptor binding, and potentially negatively impact drug efficacy and safety.
Our Core Product provides a convenient once-weekly dosing regimen in injection
frequency as compared to once-daily hGH, which may foster increased dosing
compliance for pediatric patients in daily lives. As a result, it has the potential to
further improve treatment outcomes and duration over daily hGH in real-world
settings. A convenient auto-injector was included in the FDA and EMA approvals of
lonapegsomatropin for PGHD.
China accounted for the largest share of the global hGH market in 2023, surpassing
the United States and representing 34% of the global market. The hGH market in
China was RMB11.6 billion in 2023 and is expected to grow to RMB28.6 billion by
2030, at a CAGR of 13.7% from 2023 to 2030, according to Frost & Sullivan.
In May 2023, we submitted a formal communication application package to the CDE
of the NMPA, in accordance with the Administrative Measures for Communication
of Drug R&D and Technical Review (),
which requires in principle an application prior to a BLA submission for therapeutic
biological drug candidates. In June 2023, we received official response in writing
from the CDE of the NMPA, confirming that (i) the Core Product’s Phase 3 pivotal
trial was completed; (ii) primary endpoint of the trial demonstrate: (a) superiority
efficacy over daily hGH in terms of 52-week AHV which is consistent with results
from the global clinical trials; and (b) similar safety profile comparing to daily
growth hormone products; and (iii) based on the data provided, the CDE of the
NMPA agrees for us to proceed with our BLA filing of the Core Product for the
treatment of PGHD. We made the BLA filing with the NMPA on January 18, 2024
for our Core Product for the treatment of PGHD, after which we submitted
supplemental administrative materials per request from the CDE of the NMPA, and
the BLA filing was subsequently accepted by the NMPA on March 7, 2024.
 TransCon CNP (navepegritide) is a disease-modifying therapy studied by us to treat
children aged 2 to 10 years old with ACH in China, where there is currently no
effective disease-modifying therapy approved. We in-licensed the TransCon CNP
(navepegritide) from Ascendis Pharma in November 2018. Prior to our in-licensing,
TransCon CNP (navepegritide) had been studied by Ascendis Pharma in 45 healthy
adult male subjects in a Phase 1 global trial. TransCon CNP (navepegritide) is
designed to optimize efficacy with a safe and convenient once-weekly dose, and is
the first ACH therapy in clinical development in China to date, according to Frost
& Sullivan.
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TransCon CNP (navepegritide) has completed the double-blind period of Phase 2
clinical trial in China for the treatment of ACH. We became the sole sponsor for the
OLE period of this trial in January 2023 and the last patient last visit of the OLE
period was completed in April 2024. In this Phase 2 trial, subjects received their
assigned dose (or placebo) for 52 weeks, after which they continue participation in
the OLE period for approximately 52 weeks where all subjects receive TransCon
CNP (navepegritide). The primary analysis of double-blind period for our ongoing
China Phase 2 trial was completed in November 2023. The topline results of the
primary endpoint, AGV at 52 weeks, demonstrated a greater AGV of 5.939 cm/year
for the cohort dosed at 100 µg/kg/week compared to 4.760 cm/year for placebo. The
topline results also suggest that TransCon CNP (navepegritide) was generally well
tolerated, without drug-related serious adverse events, and adverse events leading to
discontinuation of the drug in the subjects. The topline results from China Phase 2
trial demonstrate consistency with the global Phase 2 trial in terms of primary
endpoint and safety profile.
 Palopegteriparatide is a treatment studied by us to treat adults with HP . We
in-licensed palopegteriparatide from Ascendis Pharma in November 2018. Prior to
our in-licensing, palopegteriparatide had been studied by Ascendis Pharma in
healthy adult volunteers in a Phase 1 trial. The current treatments for HP are
inadequate due to their limited therapeutic benefits and the need for chronic
administration of calcium in high doses and increased risks of associated
complications. Palopegteriparatide is designed to restore physiologic levels and
activity of PTH throughout 24 hours per day, thereby addressing full aspects of the
disease, including normalizing serum and urinary calcium and serum phosphate
levels.
We are studying palopegteriparatide in a Phase 3 pivotal trial in China, and have
completed its double-blind period in January 2023. Subjects received
palopegteriparatide or placebo in the double-blind period for 26 weeks, after which
they will continue in the trial as part of a long-term OLE study of up to 156 weeks.
The primary endpoint, defined as the proportion of subjects with albumin-adjusted
serum calcium within the normal range, independence from calcitriol or alfacalcidol
active vitamin D, and independence from therapeutic doses of calcium (i.e., taking
calcium supplements /H11349600 mg/day) at 26 weeks of treatment, and no increase in
prescribed study drug within 4 weeks prior to Week 26 visit, was achieved by 77.6%
(45 of 58) of palopegteriparatide-treated patients, compared to 0.0% (0 of 22) of
patients in control group (p-value <0.0001). The topline data also suggest
palopegteriparatide was generally well tolerated, without drug-related serious
adverse events, and adverse events leading to discontinuation of the drug in the
subjects. The topline data from China Phase 3 pivotal trial demonstrate consistency
with the global Phase 3 pivotal trial, in terms of primary endpoint and safety profile.
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Transient conjugation technology . Our drug pipeline is developed based on transient
conjugation technology (TransCon) that enables a prodrug, in which the parent drug is
protected in an inactive form, to release unmodified parent drug in a predictable manner after
distribution into the body and resume physiologic activity. The effectiveness and vast potential
of this transient conjugation technology (TransCon) have been supported by the FDA and EMA
approvals of both lonapegsomatropin for PGHD, the first marketing approvals obtained by a
drug generated from this technology, and palopegteriparatide for hypoparathyroidism in adults.
R&D execution capabilities . Since our inception, our management and internal R&D
teams have carried out extensive R&D activities. In carrying out clinical development
operations, our R&D team reviewed all relevant clinical data generated from the global clinical
trials of the three drug candidates conducted by our collaboration partner, Ascendis Pharma,
and prepared for clinical trial initiations in China. Leveraging strong domain knowledge in the
specific disease epidemiology, disease characteristics, local clinical practice as well as the
current status of the market for the indications targeted by these drug candidates, our R&D
team designed and implemented the study protocol for the clinical trials in China, and has
substantially advanced the clinical development of our three drug candidates. See “– Our Drug
Pipeline” and “– Research and Development” for more details.
Commercialization planning . In anticipation of the upcoming commercial launch of our
drug candidates, we started building up a focused and specialized commercialization team with
strong expertise in endocrinology. With respect to specific characteristic of each pipeline drug
and their respective market conditions, we have designed tailor-made programs for
commercialization, patient awareness, and market access. For lonapegsomatropin, we plan to
deploy a pediatric endocrine medical representative team to cover public hospitals, establish
collaborations with an extensive network of private clinics, and offer a comprehensive service
program to cover majority of the potential markets for lonapegsomatropin. For TransCon CNP
(navepegritide), the disease-modifying drug for ACH, we plan to leverage lonapegsomatropin
team for commercial coverage, build up the awareness of ACH and establish TransCon CNP
(navepegritide) as the standard of care for ACH, and participate in the negotiation of NRDL
to maximize patient access. For palopegteriparatide, the PTH replacement therapy for HP , we
plan to deploy a separate adult endocrinology medical representative team, establish HP
treatment centers to cover broad geographic areas and a large patient pool via a
“hub-and-spoke” model, engage in various activities to improve disease awareness, advance
diagnosis and treatment for HP , and participate in the negotiation of NRDL to maximize patient
access. Further, we have entered into a strategic collaboration agreement with Shanghai
Pharmaceutical aiming to establish the necessary management framework in line with the GSP .
Commercial supply and local manufacturing capability . We plan to implement a
three-step plan to source commercial supply for the commercialization of lonapegsomatropin
as early as possible and address the vast domestic market potentials in China (including Hong
Kong, Macau and Taiwan) effectively and secure sustainable drug supply for local patients. In
the short term, we plan to first source the commercial drug supply from our collaboration
partner, Ascendis Pharma. We have successfully reached a commercial supply agreement for
the commercial supply of Core Product by Ascendis Pharma in October 2023. In the medium
term, we will collaborate with WuXi Biologics to manufacture lonapegsomatropin for
commercial supply in China (including Hong Kong, Macau and Taiwan). In the long term, we
plan to establish our in-house manufacturing capabilities.
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CMC R&D and Local BLA for local manufacturing . According to the Exclusive License
Agreement, we have the contractual right to obtain full knowledge of the Core Product drug
substance manufacturing technology knowhow from Ascendis Pharma. As a step towards local
manufacturing of our Core Product, in July 2023, we entered into a bilateral Technology
Transfer Master Plan of the Core Product with Ascendis Pharma, which has marked the
commencement of the technology transfer (“Technology Transfer”) with respect to the
manufacturing of the Core Product from Ascendis Pharma to us and sets forth the obligations
of both parties under the Exclusive License Agreements with respect to the Technology
Transfer. After completion of the Technology Transfer, we will have the full knowledge of the
Core Product drug substance manufacturing technology knowhow to independently collaborate
with WuXi Biologics or any other chosen CDMO in China. Further, in December 2023, we
entered into a bilateral collaboration agreement with WuXi Biologics, pursuant to which WuXi
Biologics will serve as the local CDMO of the Technology Transfer to conduct the process
development and validation achieving the localization of the manufacturing technology
(together with the Technology Transfer, the “Technology Transfer and Localization”).
Completion of the Technology Transfer and Localization, which is expected to be in 2027, will
confer to us the technical capabilities to manufacture the Core Product drug substance in
collaboration with WuXi Biologics. We are also developing the DCD technology in the form
of prefilled syringe as a drug delivery system for the Core Product drug substance. Once this
development is finished, WuXi Biologics will have the capability to produce the Core Product.
The commercialization of the Core Product manufactured by WuXi Biologics will start once
we obtain the approval of Local BLA, which is expected to occur in 2028. See “– Research and
Development – CMC Development Programs” for more details. We expect to procure the Core
Product from Ascendis Pharma for the commercial supply until 2028 following our anticipated
commercialization activities in late 2025 after BLA approval.
License agreements . Pursuant to the terms of each Exclusive License Agreement we
entered into with Ascendis Pharma, we were granted an exclusive license to develop,
manufacture and commercialize the applicable drug candidates in endocrinology in China
(including Hong Kong, Macau and Taiwan). Under the Exclusive License Agreements, we are
not obligated to make cash payments, in the name of initial upfront payment, royalty payment
or milestone payment associated with development milestones. In addition, during the term of
the Exclusive License Agreements, we are entitled to a first right of negotiation to obtain rights
to develop and commercialize endocrine drugs in China (including Hong Kong, Macau and
Taiwan) developed by Ascendis Pharma based on the validated technology. See “–
Collaborations” for more details.
Shareholder base . Our Founding Shareholders include Ascendis Pharma (through its
subsidiaries), Vivo Capital and Sofinnova. Since our inception, we have raised approximately
US$40 million from our Founding Shareholders and an additional US$150 million
subsequently from a group of strategic and life sciences focused institutional investors who
support our mission, including our Founding Shareholders, HongShan Growth, OrbiMed,
Sherpa Healthcare Partners, Cormorant, HBM Healthcare Investments, Pivotal bioV enture
Partners China, Logos Capital and CRF Investment.
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OUR STRENGTHS
We believe the following strengths have contributed to our success and differentiated us
from our competitors.
Late-stage pipeline based on validated technology, fast approaching revenue generation
with high degree of certainty
With a therapeutic pipeline built on validated technology and in late clinical development
stages, we are fast approaching revenue generation with high degree of certainty.
Our drug pipeline is generated based on transient conjugation technology (TransCon).
Transient conjugation molecules have three components: an existing parent drug, an inert
carrier that protects it, and a linker that temporarily binds the two. When bound, the carrier
inactivates and shields the parent drug from clearance. After distribution into the body,
transient conjugation enables unmodified parent drug to be released in a predictable manner
and maintain physiologic activity. Overall, transient conjugation technology (TransCon) is
designed to combine known biology with the benefits of prodrug and sustained-release
technologies to potentially optimize therapeutic effect, which could mean enhancing efficacy,
improving tolerability and convenience, or reducing caregiver burden.
We believe other long-acting drug release technologies have limitations, which signifies
the high entry barrier of this technical field. For example, permanent modification
technologies, such as PEGylation and fusion protein, are often used to develop long-acting
drugs, but exhibit risks of altering the potency of drugs and negatively impacting drug efficacy
and safety. With respect to the application of long-acting technologies in hGH products, out of
the nearly 20 global LAGH drug candidates that were once in the clinical-stage, or even
approved, most did not reach commercial stage primarily due to clinical trial data issue,
including high rate of lipoatrophy at injection site, unsatisfactory IGF-1 profile peak, duration
and presumed unfavorable benefit risk profile ratio. While a few were able to reach commercial
stage, they were subsequently removed from the market primarily due to factors such as market
development strategies, cost considerations, competitive advantages and disadvantages of the
product, and other relevant factors. Among all already commercialized LAGH drugs or
clinical-stage LAGH drug candidates, very few have been able to demonstrate non-inferior or
superior efficacy in active-controlled and parallel-group trial comparisons with daily hGH.
Leveraging our clinical development capabilities, all three of our pipeline drug candidates
have either completed or are undergoing pivotal/clinical trials in China, and are fast
approaching commercial launch stage.
 Lonapegsomatropin. We obtained IND approval from the NMPA in October 2019 to
initiate the Phase 3 pivotal trial for our Core Product, lonapegsomatropin, in China
for the treatment of PGHD. Shortly after IND approval, we completed the first site
initiation in December 2019 in an efficient manner. We randomized the first patient
in China in January 2020 and completed patient enrollment for this trial in March
2021 according to our initial targeted timeline without any early termination or
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suspension of our clinical trials despite the disruption of COVID-19 pandemic and
clinical site lock-down. In this trial on human subjects, we assessed the efficacy,
popPK profile, safety and tolerability of this drug candidate and enrolled 154 and
treated 153* treatment-naïve, pre-pubertal children with GHD across multiple
centers in China. Each participant received either once-weekly lonapegsomatropin
or once-daily hGH for 52 weeks. We completed this trial in April 2022. According
to our published results, lonapegsomatropin was shown to be non-inferior and,
additionally, superior to the daily hGH on the primary endpoint of AHV at 52 weeks;
it was well tolerated and demonstrated comparable safety as compared to daily hGH,
consistent with the global data reported in the global trial of this drug candidate. On
March 7, 2024, the BLA filing of our Core Product for the treatment of PGHD was
accepted by the NMPA.
 TransCon CNP (navepegritide). TransCon CNP (navepegritide) has completed the
double-blind period of Phase 2 clinical trial in China for the treatment of ACH. We
became the sole sponsor for the OLE period of this trial in January 2023 and the last
patient last visit of the OLE period was completed in April 2024. The primary
analysis of double-blind period for our ongoing China Phase 2 trial was completed
in November 2023. The topline results of the primary endpoint, AGV at 52 weeks,
demonstrated a greater AGV of 5.939 cm/year for the cohort dosed at 100
µg/kg/week compared to 4.760 cm/year for placebo. The topline results also suggest
that TransCon CNP (navepegritide) was generally well tolerated, without drug-
related serious adverse events, and adverse events leading to discontinuation of the
drug in the subjects. The topline results from China Phase 2 trial demonstrate
consistency with the global Phase 2 trial in terms of primary endpoint and safety
profile.
 Palopegteriparatide. We obtained IND approval from the NMPA in May 2021 to
initiate the Phase 3 pivotal trial for palopegteriparatide in China for the treatment of
adult HP . This trial is designed to assess the efficacy, safety and tolerability of
palopegteriparatide in 76 adults with HP , across multiple centers in China. Each
participant will receive palopegteriparatide or placebo for 26 weeks, after which
they will continue participation in the trial as part of a long-term OLE study of up
to 156 weeks where all participants will receive palopegteriparatide, with the dose
adjusted to their individual needs. We screened the first patient in November 2021
and completed patient enrollment in June 2022. In January 2023, we completed the
double-blind period of this trial. The primary endpoint was achieved by 77.6% (45
of 58) of palopegteriparatide-treated patients, compared to 0.0% (0 of 22) for
patients in control group (p-value < 0.0001). The topline data also suggest
palopegteriparatide was generally well tolerated. The topline data from China Phase
3 pivotal trial demonstrate consistency with the global Phase 3 pivotal trial, in terms
of primary endpoint and safety profile. The expected NDA filing to the NMPA is
planned for 2025.
* One child dropped out prior to receiving treatment due to reasons unrelated to the clinical trial.
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We have started preparation work for commercialization capabilities of our Core Product,
lonapegsomatropin, backed by patient support and market access. We expect NDA approvals
for our two key drug candidates, palopegteriparatide and TransCon CNP (navepegritide), to
follow in the coming years, by when all of our pipeline candidates will reach
commercialization stage. See “– Our Strategies” and “– Commercialization Plan, Patient
Support and Market Access” for more details.
Lonapegsomatropin as the long-acting hGH replacement therapy for PGHD in China, the
largest and fast-growing hGH market in the world
Lonapegsomatropin, our Core Product, is a once-weekly growth hormone replacement
therapy for PGHD that received marketing approvals from the FDA and the EMA, and the only
LAGH with superior efficacy and comparable safety in comparison to daily hGH – the current
treatment for PGHD. We in-licensed lonapegsomatropin from Ascendis Pharma in November
2018. Prior to our in-licensing, lonapegsomatropin had been studied by Ascendis Pharma in
over 300 children with GHD across three Phase 3 programs.
PGHD is a medical condition of noticeable short height in children due to insufficient
growth hormone. The current treatment for PGHD is daily subcutaneous injections of hGH.
Daily therapy with hGH has been shown to increase growth and improve metabolic function
in children. However, the burden of daily administration often resulted in poor patient
compliance, as supported by a 2021 study. According to Frost & Sullivan, up to 82% of the
patients missed at least one daily dose per week. Poor compliance could potentially lead to
suboptimal treatment outcomes. In a separate study of 110 children, two out of three patients
missed more than one injection per week on average, and suboptimal growth outcomes were
observed in patients who missed over one dose per week compared to patients missed no more
than one dose on average.
The hGH market in China grew rapidly from RMB4.0 billion in 2018 to RMB11.6 billion
in 2023, at a CAGR of 23.9%. hGH therapy can be applied to treat PGHD and other short
statures. The prevalence of PGHD in China was 3.4 million in 2023, while the prevalence of
short statures under the age of 18 was 8.1 million in the same year. From 2018 to 2023, the
hGH market in China achieved a higher CAGR than the hGH market in the United States,
according to Frost & Sullivan. China accounted for the largest share of the global hGH market
in 2023, surpassing the United States and representing 34% of the global market. The hGH
market in China is expected to reach RMB28.6 billion in 2030. Due to the burden of daily hGH
injections and its associated poor treatment compliance and suboptimal treatment outcomes,
this market is undergoing a paradigm shift from daily hGH treatment to LAGH treatment, with
the market share of LAGH projected to be 73.8% of the whole hGH market in China in 2030,
compared to an estimated market share of 25.0% in 2023, according to Frost & Sullivan. In
addition to drug innovations, favorable government initiatives are expected to further drive the
growth of hGH market in China. “Healthy China Action (2019-2030)” ( ਄ੰʕ਷Бਗ
(2019-2030 ϋ)) issued by National Health Commission in September 2019, for example,
announced a national goal to reduce the stunting rate of children under the age of five from
8.1% in 2013 to below 7% by 2022 and below 5% by 2030.
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Lonapegsomatropin is a drug candidate in China indicated for PGHD. Leveraging
transient conjugation technology (TransCon), lonapegsomatropin is designed to enable a
weekly dosing scheme and the release of unmodified hGH in vivo which is identical in the
molecular composition to the endogenous growth hormone secreted by pituitary gland and
preserves its original mode of action. Due to these unique features, lonapegsomatropin
overcomes the drawbacks of daily hGH treatments, particularly the daily administration
requirement and the associated poor compliance and suboptimal treatment outcomes. It also
demonstrates potential advantages over modified LAGHs, some of which have shown severe
injection site reactions or even lipoatrophy due to high dose and long exposure of active
molecule at the injection site, according to Frost & Sullivan.
The published results of the completed Phase 3 pivotal trial in China consistently
supported lonapegsomatropin’s superior growth profile and comparable safety profile in
comparison to daily hGH. In this trial, lonapegsomatropin was associated with an AHV of
10.66 cm/year compared to 9.75 cm/year for daily hGH at 52 weeks, with a p-value of 0.0010,
making it the first weekly LAGH with data that demonstrated superior efficacy compared to a
daily somatropin and the only LAGH achieved such superiority in a pivotal trial to date. Height
SDS at 52 weeks increased over baseline by 1.01 for lonapegsomatropin and by 0.83 for daily
hGH, with a p-value of 0.0015, and statistical significance of change in height SDS from
baseline ( /H9004height SDS) was demonstrated in the lonapegsomatropin group from and including
13 weeks onwards.
A convenient auto-injector was introduced to the global clinical development of
lonapegsomatropin for PGHD, which could further differentiate lonapegsomatropin from other
hGH therapies. To facilitate ease of use, the auto-injector is designed to offer easy injection,
hidden needle, small injection volume, and six-month room temperature storage. This
auto-injector was included in the FDA and EMA approvals of lonapegsomatropin and is the
first FDA-approved and the first EMA-approved auto-injector to deliver once-weekly growth
hormone to pediatric patients, according to Frost & Sullivan.
See “– Our Strengths – Late-stage pipeline based on validated technology, fast
approaching revenue generation with high degree of certainty” for more details regarding the
clinical development of lonapegsomatropin in China.
TransCon CNP (navepegritide) as the disease-modifying therapy in China (including
Hong Kong, Macau and Taiwan) for ACH
TransCon CNP (navepegritide) is a long-acting prodrug of CNP and disease-modifying
therapy in development for ACH in children in China (including Hong Kong, Macau and
Taiwan). We in-licensed the TransCon CNP (navepegritide) from Ascendis Pharma in
November 2018. Prior to our in-licensing, TransCon CNP (navepegritide) had been studied by
Ascendis Pharma in 45 healthy adult male subjects in a Phase 1 global trial.
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ACH is the most common form of dwarfism that results in severe skeletal complications
and comorbidities. Patients often face multiple surgeries to alleviate the various complications
associated with ACH. The prevalence of ACH in China was 51.2 thousand in 2023. Currently,
there is no approved therapy available in China to treat the genetic basis of ACH, with medical
and surgical interventions limited to addressing some of the symptoms, including spinal
stenosis, hydrocephalus and obstructive sleep apnoea. To date, TransCon CNP (navepegritide)
is the first ACH therapy in clinical development in China, designed to optimize efficacy with
a safe and convenient once-weekly dose. It is able to provide effective shielding of CNP from
neutral endopeptidase degradation in the subcutaneous tissue and the blood compartment,
minimize binding of CNP to the NPR-C receptor to decrease clearance, reduce binding of CNP
to the NPR-B receptor in the cardiovascular system to avoid hypotension, and release
unmodified CNP , which is small enough in size to allow effective penetration into growth
plates.
TransCon CNP (navepegritide) has completed the double-blind period of Phase 2 clinical
trial in China for the treatment of ACH. We became the sole sponsor for the OLE period of this
trial in January 2023 and the last patient last visit of the OLE period was completed in April
2024. The primary analysis of double-blind period for our ongoing China Phase 2 trial was
completed in November 2023. The topline results of the primary endpoint, AGV at 52 weeks,
demonstrated a greater AGV of 5.939 cm/year for the cohort dosed at 100 µg/kg/week
compared to 4.760 cm/year for placebo. The topline results also suggest that TransCon CNP
(navepegritide) was generally well tolerated, without drug-related serious adverse events, and
adverse events leading to discontinuation of the drug in the subjects. The topline results from
China Phase 2 trial demonstrate consistency with the global Phase 2 trial in terms of primary
endpoint and safety profile.
See “– Our Strengths – Late-stage pipeline based on validated technology, fast
approaching revenue generation with high degree of certainty” for more details regarding the
clinical development of TransCon CNP (navepegritide) in China.
Palopegteriparatide as the PTH replacement therapy in China (including Hong Kong,
Macau and Taiwan) addressing the underlying cause of HP
Palopegteriparatide is an investigational long-acting prodrug of PTH in development for
the treatment of adult patients with HP . We in-licensed palopegteriparatide from Ascendis
Pharma in November 2018. Prior to our in-licensing, palopegteriparatide had been studied by
Ascendis Pharma in healthy adult volunteers in a Phase 1 trial.
HP is a syndrome of abnormal calcium and phosphorus metabolism caused by decreased
secretion or defective function of PTH. The prevalence of HP in China was 410.1 thousand in
2023. The conventional therapy consisting of calcium in combination with active vitamin D
and sometimes other supplements, while can increase serum calcium level, is hard to restore
the serum calcium level to the normal range. Additionally, the use of very high doses of
calcium and active vitamin D which is often required by conventional therapy, causes serum
calcium fluctuation, high urine calcium and high serum phosphate, potentially putting HP
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patients at risk for many complications such as impaired renal function and extraskeletal
calcifications. Some individuals remain symptomatic or fail to meet treatment goals even after
conventional therapy, with some requiring multiple hospitalizations for hypocalcemia or HP
complications. PTH therapy, as a feasible alternative to conventional therapy, has been shown
to maintain normocalcemia without the need (or with reduced need) for concurrent treatment
with the therapeutic dosage of calcium and active vitamin D analogs. However, the only
currently available PTH therapy (i) is unable to achieve the physiological level and activities
of PTH due to its short half-life; and (ii) has not demonstrated the ability to reduce
hypercalcemia (elevated serum calcium levels), hypocalcemia (low serum calcium) or
hypercalciuria (elevated urinary calcium) relative to conventional therapy in treated patients.
Palopegteriparatide is designed as a once-daily PTH replacement therapy with a long
half-life to address the fundamental cause of HP by restoring physiological and stable levels
of PTH 24 hours throughout the day, thereby addressing all aspects of the disease including
normalizing serum and urinary calcium and serum phosphate levels. By doing so,
palopegteriparatide serves as a PTH replacement therapy and has the potential to address both
the short-term symptoms and long-term complications of HP , including kidney stones, renal
disease and brain calcification, and as a result, improve quality of life.
We are studying palopegteriparatide in a China Phase 3 pivotal trial, and have completed
its double-blind period in January 2023. Based on the topline data from China Phase 3 pivotal
trial, the primary endpoint, defined as the proportion of subjects with albumin-adjusted serum
calcium within the normal range, independence from calcitriol or alfacalcidol active vitamin D,
and independence from therapeutic doses of calcium (i.e., taking calcium supplements /H11349600
mg/day) at 26 weeks of treatment, and no increase in prescribed study drug within 4 weeks
prior to Week 26 visit, was achieved by 77.6% (45 of 58) of palopegteriparatide-treated
patients, compared to 0.0% (0 of 22) of patients in control group (p-value <0.0001). The
topline data also suggest palopegteriparatide was generally well tolerated, without drug-related
serious adverse events and adverse events leading to discontinuation of the drug in the subjects.
The topline data from China Phase 3 pivotal trial demonstrate consistency with the global
Phase 3 pivotal trial, in terms of primary endpoint and safety profile.
See “– Our Strengths – Late-stage pipeline based on validated technology, fast
approaching revenue generation with high degree of certainty” for more details regarding the
clinical development of palopegteriparatide in China.
Strong clinical and regulatory capabilities with proved track-records in developing our
drug candidate pipeline products
We leverage our understanding of the regulatory landscape in China to expedite the
approval and commercial launch of each of our drug candidates. With insights and expertise in
the endocrinology field, we are able to navigate the development, regulatory and
commercialization landscape in China and seek opportunities to quickly bring our drug
candidates to patients while maximizing the full value of each of our drug candidates.
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Operationally, our R&D team manages all of the key aspects of our trials, including
clinical trial design, implementation, the collection and analysis of trial data, and regulatory
submission and communications. Our R&D team is composed of departments of clinical
development, regulatory affairs, medical affairs and CMC, and is headed by Dr. W ANG Y an,
Ms. Tina CHEN, Mr. GU Qing and Dr. ZHU Jing, respectively. See “– Research and
Development – R&D Team and Capabilities” for more details. As of the Latest Practicable
Date, the Company’s R&D team consisted of 31 full-time employees, with approximately 45%
holding a Ph.D. or an M.D. degree. We expect to grow our R&D team as we continue our
development activities. Almost all of our R&D team members have in-depth industry
knowledge and clinical development experience in multinational companies. Our R&D team
has an average of over 14 years of experience in the clinical development of drugs and/or
endocrine therapies and some of them have extensive expertise in endocrinology and related
areas and worked on the clinical development of other endocrine drugs. Our R&D capabilities
are also supported by a scientific advisory board comprising three reputable KOLs in
endocrinology and pediatrics, a steering committee for our Phase 3 pivotal trial in PGHD in
China, comprising KOLs, overseas clinical professional experts and biostatisticians, as well as
a data monitoring committee for the Phase 2 clinical trial of TransCon CNP (navepegritide) in
children with ACH in China, comprising experienced KOLs and members from reputable
medical institutions around the world.
To date, our team has demonstrated a strong ability to optimize study design and
development strategy in China, which has enabled us to advance our drug candidates directly
into pivotal studies in China utilizing validated endpoints, such as popPK. We carry out clinical
execution in an efficient manner. With respect to the clinical development of
lonapegsomatropin for PGHD in China, we obtained IND approval 11 months after in-licensing
of this drug candidate, and dosed our first patient within three months after IND approval. We
also have completed full patient enrollment according to our initial targeted timeline without
any early termination or suspension of our clinical trials despite the disruption of the
COVID-19 pandemic and the investigational site lockdown.
As one of the pioneering biopharmaceutical companies in China focusing on
endocrinology, we proactively seek opportunities to get involved in the development of the
Chinese healthcare ecosystem, including the scientific communication of disease awareness
and diagnosis, HCP education and drug regulation. We supported the founding of
Achondroplasia Advisory Board under the governance of the Advisory Board of CHARD in
June 2019 and subsequently entered a five-year strategic cooperation with CHARD, on a
national patient registry and diagnosis consensus of ACH in China. We also initiated the
PaTHway R study in collaboration with Peking University Health Science Center in January
2022, which is the first registry study for HP patients in China and one of the largest
epidemiological surveys for this disease worldwide. We plan to continue to proactively get
involved in driving drug policies and treatment guidelines for endocrine drugs.
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World-class management team with deep commercialization expertise and strong support
from Shareholders and investors
Our management team consists of experienced industry leaders who have deep knowledge
of the clinical development, commercialization and regulatory landscape in China (including
Hong Kong, Macau and Taiwan). We recognize that our ability to secure the best assets and
efficiently execute the clinical development of drug candidates in China (including Hong
Kong, Macau and Taiwan) requires a trusted team with an established track record, and we have
consistently focused on identifying and cultivating top-tier talent. Our management team has
capabilities spanning drug development, manufacturing, commercialization and business
development, as well as experience from multinational corporations and working on drugs
targeting endocrine indications, with an average of 17 years of experience in the industry. Our
management team is led by:
 Mr. LU An-Bang, our Chief Executive Officer and Executive Director, is responsible
for the overall development strategy and business direction of our Group. Mr. Lu has
over 31 years of experience in global biopharmaceutical development with a proven
track record of commercialization and operational success in China. Prior to joining
us, Mr. Lu served as the general manager, president and the head of greater China
at Takeda Pharmaceutical Company Limited, a global biopharmaceutical company,
from 2010 to 2017. During Mr. Lu’s tenure, Mr. Lu oversaw Takeda’s critical growth
and Takeda has achieved over ten times increase in sales revenue in China. Prior to
Takeda, Mr. Lu served as the general manager at Servier (Tianjin), responsible for
the overall development of Mainland China business.
 Dr. CHEN Jun, Ph.D., our Chief Commercial Officer, is responsible for the overall
management of the drug commercialization of our Group. Dr. Chen has over 25
years of global pharmaceutical industry experience in China and the United States.
Dr. Chen served as vice president of the diabetes portfolio business unit at Eli Lilly
China from July 2018 to March 2021. From May 2016 to July 2018, he was vice
president of the diabetes business group in China (including Hong Kong, Macau and
Taiwan) at Medtronic China. Dr. Chen served various management roles at Novo
Nordisk USA and China from January 2002 to April 2016, where he most recently
served as vice president of marketing at Novo Nordisk China. He was an associate
at McKinsey & Company from 2000 to 2002. Prior to that, Dr. Chen was a
pharmaceutical scientist at Merck & Co. and its affiliate company Merial Ltd. from
1997 to 2000. Over his tenure, Dr. Chen commercialized multiple blockbuster
endocrinology products and managed a large commercial organization with more
than 1,000 staff.
Our management team also includes other senior members who oversee functions
including clinical science, regulatory affairs, commercialization, clinical operations, quality
assurance, biostatistics, CMC, and project management, with extensive expertise in their
respective areas.
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We are supported by a network of Shareholders and investors who share our values and
missions, including our Founding Shareholders, namely, Ascendis Pharma, Vivo Capital and
Sofinnova, as well as a group of strategic and life sciences focused institutional investors,
namely, HongShan Growth, OrbiMed, Sherpa Healthcare Partners, Cormorant, HBM
Healthcare Investments, Pivotal bioV enture Partners China, Logos Capital and CRF
Investment. We believe our relationships with these investors will further drive our success in
developing value-creating partnerships.
OUR STRATEGIES
Rapidly advance the regulatory approval of our Core Product and the clinical
development and regulatory approval of other pipeline candidates
Having completed the Phase 3 pivotal trial of our Core Product, lonapegsomatropin, for
the treatment of PGHD in China, we are focusing on rapidly advancing the regulatory approval
of this drug candidate. On March 7, 2024, the BLA filing of our Core Product for the treatment
of PGHD was accepted by the NMPA.
We also intend to leverage our own clinical development capabilities and joint global
studies with Ascendis Pharma to rapidly advance the clinical development and regulatory
approval of our key drug candidates, TransCon CNP (navepegritide) and palopegteriparatide.
Specifically, TransCon CNP (navepegritide) has completed the double-blind period of Phase 2
clinical trial in China for the treatment of ACH. We became the sole sponsor for the OLE period
of this trial in January 2023 and the last patient last visit of the OLE period was completed in
April 2024.
We are developing palopegteriparatide in an ongoing Phase 3 pivotal trial, and
completed its double-blind period in January 2023. We will incorporate the global data of
palopegteriparatide to facilitate the review process by the NMPA and expect to make the NDA
filing to the NMPA in 2025. In terms of the global regulatory status of palopegteriparatide,
Ascendis Pharma obtained EMA approval in November 2023 and resubmitted the NDA to the
FDA in the same month. The Prescription Drug User Fee Act date, the deadline by which the
FDA shall respond to the NDA, was originally set in May 2024 and extended to August 2024
due to the fact that the information submitted by Ascendis Pharma in response to the FDA’s
ongoing review of the NDA for palopegteriparatide constituted a major amendment to the
NDA, according to the public information of Ascendis Pharma. In August 2024, Ascendis
Pharma obtained FDA approval.
Build commercialization capabilities backed by patient support and market access in
anticipation of the commercial launch of our Core Product and lay the foundation for
commercialization of future drug candidates
In anticipation of the upcoming commercial launch of our drug candidates, we have added
Dr. CHEN Jun as Chief Commercial Officer and started building up a focused and specialized
commercialization team with strong expertise in endocrinology. We expect to implement the
following strategies for the commercialization of each drug candidate.
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Lonapegsomatropin
The commercial goal for lonapegsomatropin is two-fold: (i) to accelerate market
transition from short-acting daily growth hormone to long-acting weekly growth hormone; and
(ii) to establish lonapegsomatropin as the leading LAGH.
Lonapegsomatropin will be positioned to reflect its value propositions to patients. We
plan to deploy a pediatric medical representative team covering majority of the market
potential for lonapegsomatropin. We plan to build extensive collaborations with private
hospitals/clinics where patients can have easy access for prescription refill and continued
services. Additionally, we plan to offer multiple patient support programs including a
comprehensive patient starter kit, assistance from a professional service team, as well as a
digital patient service platform to provide added value to patients. By conveying the distinct
product advantages and value propositions over other marketed growth hormone products, we
expect to establish a leading market position in the large and fast-growing hGH market in
China.
TransCon CNP (navepegritide)
Once TransCon CNP (navepegritide) is commercially available, our main commercial
goals are to build up the awareness of ACH among key stakeholders, establish TransCon CNP
(navepegritide) as the standard of care for ACH, and establish patient access. A successful
execution of this commercial strategy will enable a rapid revenue uptake of TransCon CNP
(navepegritide).
We have already initiated a number of activities to develop the ACH market, including
supporting ApproaCH Registry Study which will generate China-specific ACH epidemiology
data, supporting the development of the first ACH Expert Consensus in China on Diagnosis and
Treatment, and facilitating the inclusion of ACH in China Rare Disease List. Upon product
launch, we plan to participate in the negotiation of NRDL to maximize patient access. The
synergy between lonapegsomatropin and TransCon CNP (navepegritide) allows us to share one
medical representative team. We expect TransCon CNP (navepegritide) will achieve a rapid
revenues uptake.
Palopegteriparatide
The commercial goal for palopegteriparatide includes market development, patient
education, patient access, and establishing HP treatment centers.
We plan to engage in various activities to improve disease awareness and advance
diagnosis and treatment, such as facilitating the update of HP diagnosis and treatment
guideline, and initiating PaTHway R study – the first HP patient registry study in China.
Additionally, we plan to initiate extensive patient education activities through patient advocacy
and social media. Upon product launch, we plan to participate in the negotiation of NRDL to
maximize patient access. We plan to deploy a separate adult endocrinology medical
representative team and a “hub-and-spoke” model to cost effectively cover HP market
potential.
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Establish localized manufacturing capabilities to secure the supply of our Core Product
and future potential drug candidates in China (including Hong Kong, Macau and Taiwan)
We plan to establish localized manufacturing capabilities for lonapegsomatropin in China
to address the vast domestic market potentials in China (including Hong Kong, Macau and
Taiwan) effectively and secure sustainable drug supply for local patients. We plan to implement
a three-step drug procurement and manufacturing plan to realize the commercialization of
lonapegsomatropin as early as possible and address the vast domestic market potentials in
China (including Hong Kong, Macau and Taiwan) effectively and secure sustainable drug
supply for local patients. In the short term, we plan to first source the commercial drug supply
from our collaboration partner, Ascendis Pharma. We have successfully reached a commercial
supply agreement for the commercial supply of the Core Product by Ascendis Pharma in
October 2023. Please refer to “Connected Transactions” for more details. In the medium term,
we will collaborate with WuXi Biologics to manufacture lonapegsomatropin for commercial
supply. As a step towards such goal, in July 2023, we entered into a Technology Transfer
Master Plan of the Core Product with Ascendis Pharma, which has marked the commencement
of the Technology Transfer with respect to the manufacturing of the Core Product from
Ascendis Pharma to us and sets forth the obligations of both parties under the Exclusive
License Agreement with respect to the Technology Transfer. After completion of the
Technology Transfer, we will have the full knowledge of Core Product drug substance
manufacturing technology knowhow to independently collaborate with WuXi Biologics or any
other chosen CDMO in China. Further, in December 2023, we entered into a collaboration
agreement with WuXi Biologics, pursuant to which WuXi Biologics will serve as the local
CDMO of the Technology Transfer to conduct the process development and validation
achieving the localization of the manufacturing technology. Completion of the Technology
Transfer and Localization, which is expected to be in 2027, will confer to us the technical
capabilities to manufacture the lonapegsomatropin drug substance in collaboration with WuXi
Biologics. We are also developing the DCD technology in the form of prefilled syringe as a
drug delivery system for the Core Product drug substance. Once this development is finished,
WuXi Biologics will have the capability to produce the Core Product. For more information
regarding the DCD, please refer to “– Research and Development – CMC Development
Programs – Dual Chamber Device Technology Development.” The commercialization of the
Core Product manufactured by WuXi Biologics will start once we obtain the approval of Local
BLA, which is expected to occur in 2028. In the long term, we plan to establish our in-house
manufacturing capabilities.
Expand the endocrine disease indications covered by our Core Product, two key drug
candidates, and new potential drugs based on transient conjugation technology
(TransCon)
In addition to rapidly advancing in clinical development of our three drug candidates, we
will further develop our Core Product, lonapegsomatropin, to cover more indications that may
be eligible for hGH treatment, including other pediatric pathological short stature diseases such
as idiopathic short stature (“ISS”).
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In addition, under the Exclusive License Agreements with Ascendis Pharma, we hold a
right of first negotiation on certain future Ascendis Pharma products within the endocrine
disease area for China (including Hong Kong, Macau and Taiwan). This will enable us to
source, develop and commercialize additional drug candidates that are based on the unique
transient conjugation technology (TransCon) and have the potential to be highly differentiated
endocrine therapies. We plan to collaborate with Ascendis Pharma to evaluate future potential
drug candidates and exercise our right for those products which address unmet medical needs
and possess strong commercial potential in China (including Hong Kong, Macau and Taiwan).
See “– Collaborations – Exclusive License Agreements with Ascendis Pharma” for more
details.
Further expand our pipeline portfolio through strategic in-licensing, collaborations and
partnerships for endocrine therapies looking to enter China (including Hong Kong,
Macau and Taiwan)
We will continue to select, develop, and market paradigm-shifting therapeutic drugs that
have the potential to fulfill current unmet medical needs. We aim to bridge global innovation
to bring endocrine therapies to achieve better treatment processes and outcomes for Chinese
patients, and plan to become the partner of choice in endocrinology for China (including Hong
Kong, Macau and Taiwan). We plan to fully exploit our extensive knowledge in endocrinology
and our deep understanding of the medical need and technology, and through identifying and
executing attractive licensing and collaboration opportunities or through mergers and
acquisitions, we seek to pursue business development opportunities to further expand our
portfolio with other potential biopharmaceutical partners with endocrine drugs, drug
candidates or technologies that may be synergistic or complementary to our portfolio.
Our scaled operation and platform, integrated with a commercial team that targets the
same group of doctors and call points in the endocrinology specialty, is highly synergistic with
strong operating leverage to maximize the value of additional endocrine products looking to
enter China (including Hong Kong, Macau and Taiwan):
 Synergistic clinical stage products with potential . We prioritize bringing in drugs or
drug candidates based on their clinical profile, degree of novelty and validation,
technology differentiation, the unmet medical needs of the target disease and
respective commercial potential in China (including Hong Kong, Macau and
Taiwan).
 Marketed endocrine products with only light commercialization effort required and
attractive cashflow or margin . We are strategically seeking to in-license or acquire
rights to drugs that are either already launched or in late-stage development in
regulated markets such as the United States and the European Union that may be
synergistic or complementary to our portfolio.
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As a complementary measure, we will opportunistically look to establish an internally
developed pipeline of promising therapies, with local CDMO support or through mergers and
acquisitions of research-driven biotech companies, when the products’ target or MoA fit with
our overall product offering suite and target large market opportunities.
Establish a recognized and leading franchise in endocrinology in China (including Hong
Kong, Macau and Taiwan)
We focus on the market of China (including Hong Kong, Macau and Taiwan), where we
see tremendous market potential, a large untapped patient population and unmet medical needs
across a wide range of endocrine diseases. Furthermore, recent NMPA regulatory reforms are
expected to continue to accelerate drug development and approval, particularly for drug
candidates validated overseas, as well as driving growth and demand for new therapies in
China. We believe these favorable drug policies and potential market opportunities will
continue to drive innovation and market growth in China (including Hong Kong, Macau and
Taiwan).
Since our inception we have established an in-house operational team with core functions
spanning medical science, regulatory affairs, clinical operations, quality assurance,
pharmacovigilance and data management, statistics and medical affairs, and rapidly advanced
the clinical development of our pipeline drugs. And we will leverage our regulatory capabilities
in China to expedite the approval and commercial launch of each of our drug candidates. As
we transition into a commercial-ready company with drug candidates preparing for product
launch, we are expanding our overall capabilities in drug registration, patient support, market
access, and plan to build a strong commercial team comprising direct sales and distribution
partners to maximize the value of our assets. In the long term, we plan to further strengthen
our platform with supply-chain capabilities, including the establishment of our own GMP
manufacturing facility for in-house commercial supply.
The hallmark of our portfolio strategy is to develop therapies from overseas, bridging
innovations and their clinical development for Chinese patients, and we will continue to further
expand our therapeutic offerings, as means to improve both clinical outcome and the standard
of treatments accessible to patients suffering from endocrine diseases. By developing
end-to-end capabilities integrating research and discovery, clinical development,
commercialization, manufacturing and business development of endocrine therapies, we seek
to become a recognized leader in China (including Hong Kong, Macau and Taiwan) and
maximize our value as a dedicated franchise in endocrinology.
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OUR DRUG PIPELINE
Our drug pipeline currently consists of long-acting therapies targeting endocrine
indications with the potential to address large markets in China. We focus on pediatric
endocrine diseases and adult endocrine diseases, with each group having its unique
characteristics. Children are not just small adults when it comes to endocrine disorders and
treatment. As growing individuals, pediatric patients have special needs related to growth and
development, and hence they often face a limited treatment window and an urgent need for
timely treatment. Hormone problems affecting growth or development can have significant
effects on a child’s lifelong physical and emotional well-being. In addition, treatment
compliance for children often requires parent supervision and discomfort and pain in treatment
may affect children’s compliance, calling for more convenient treatment options with
simplified drug regimens and improved treatment experience. Adult endocrine disorders often
require life-long treatment, creating significant needs for treatment options with reduced
compliance burden and favorable long-term safety profile. Below is a pipeline diagram setting
forth our drug candidates:
Drug Candidate* Indication
Clinical Development and Regulatory Status
IND Phase 1 Phase 2 Phase 3 BLA / NDA
Upcoming
Milestones of
Trials Conducted
by VISEN
Pediatric Endocrinology
Adult
Endocrinology
AchondroplasiaTransCon CNP
(navepegritide)
Ongoing China Phase 2 trial,
double-blind period completed in November 2023(2)+
Expected NDA
submission to
the NMPA
Expected NDA
submission
to the NMPA
in 2025
HypoparathyroidismPalopegteriparatide+ Ongoing China Phase 3 pivotal trial,
double-blind period completed in January 2023(3)
Core Product Key drug candidates+
Pediatric
Growth
Hormone
Deficiency
Lonapegsomatropin Completed China Phase 3 pivotal trial in April 2022
(BLA accepted by the NMPA in March 2024)(1)
Expected BLA
approval date
in the second half
of 2025
* VISEN has gained exclusive licensed rights to develop, manufacture and commercialize all drug candidates in
endocrinology in China (including Hong Kong, Macau and Taiwan).
Notes:
(1) VISEN completed the Phase 3 pivotal trial of lonapegsomatropin in China for the treatment of PGHD in April
2022 which met its primary endpoint according to the published results. We made the BLA filing with the
NMPA on January 18, 2024 for our Core Product for the treatment of PGHD, which was subsequently accepted
by the NMPA on March 7, 2024.
(2) The primary analysis of the double-blind period of the Phase 2 clinical trials of TransCon CNP (navepegritide)
in China for the treatment of ACH was completed in November 2023, with primary endpoint met according
to the topline data. We became the sole sponsor for the OLE period of this trial in January 2023 and the last
patient last visit of the OLE period was completed in April 2024.
(3) VISEN completed the primary analysis of the Phase 3 pivotal trial of palopegteriparatide in China for the
treatment of adult HP in January 2023 which met its primary efficacy and key secondary endpoints according
to its topline data.
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We acquired three drug candidates from Ascendis Pharma in November 2018 on a
royalty-free basis and hold exclusive rights to develop, manufacture and commercialize all of
our drug candidates in China (including Hong Kong, Macau and Taiwan). See “– Transient
Conjugation Technology (TransCon)” for more details regarding the transient conjugation
technology (TransCon) that our drug candidates are based on.
Lonapegsomatropin – A Long-Acting hGH Replacement Therapy for PGHD
Overview
Lonapegsomatropin, our Core Product, is a once-weekly LAGH replacement therapy
approved in the United States and the European Union for PGHD. It is a new molecular entity
and possesses a new composition of matter for which intellectual property rights have been
granted in the United States, the European Union and China. In accordance with relevant
procedures of World Health Organization, our Core Product was assigned to the recommended
INN of “lonapegsomatropin.” This once-weekly treatment could reduce treatment burden and
potentially replace the daily hGH therapies, which have been the prevalent treatment for over
30 years.
Building on the global clinical success of lonapegsomatropin and leveraging our
independent R&D strength and regulatory capabilities, we are developing lonapegsomatropin
for the treatment of PGHD in China, and have completed the Phase 3 pivotal trial in April 2022,
according to the study protocol. The completed China Phase 3 pivotal trial continued to support
lonapegsomatropin’s superior growth profile and comparable safety profile in comparison to
daily hGH, where lonapegsomatropin was associated with an AHV of 10.66 cm/year at 52
weeks compared to 9.75 cm/year for daily hGH, with a p-value of 0.0010. These trials proved
that weekly lonapegsomatropin is the first LAGH with data demonstrating superior efficacy
compared to a daily somatropin. In China, lonapegsomatropin is the only LAGH that releases
unmodified hGH in vivo , which is identical in the molecular composition to the endogenous
growth hormone secreted by pituitary gland and preserves its original mode of action, offering
our Core Product the first-mover advantage in unmodified LAGH treatments.
In May 2023, we submitted a formal communication application package to the CDE of
the NMPA, in accordance with the Administrative Measures for Communication of Drug R&D
and Technical Review (), which requires in
principle an application prior to a BLA submission for therapeutic biological drug candidates.
In June 2023, we received official response in writing from the CDE of the NMPA, confirming
that (i) the Core Product’s Phase 3 pivotal trial was completed; (ii) primary endpoint of the trial
demonstrate: (a) superiority efficacy over daily hGH in terms of 52-week AHV which is
consistent with results from the global clinical trials; and (b) similar safety profile comparing
to daily growth hormone products; and (iii) based on the data provided, the CDE of the NMPA
agrees for us to proceed with our BLA filing of the Core Product for the treatment of PGHD.
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On March 7, 2024, the BLA filing of our Core Product for the treatment of PGHD was
accepted by the NMPA and we expect to obtain the BLA approval in the second half of 2025.
In Hong Kong, we have signed a regulatory affairs service agreement with an external service
provider in August 2023, and expect to submit the BLA filing in 2025 and obtain the BLA
approval by 2026.
Etiology of GHD and MoA of Lonapegsomatropin
PGHD is a medical condition of noticeable short height in children due to insufficient
growth hormones. PGHD can be (i) congenital, resulting from genetic mutations or from
structural defects in the brain; (ii) acquired later in life as a result of trauma, infection,
radiation therapy, or tumor growth within the brain; or (iii) idiopathic with no known or
diagnosable cause. The burden of PGHD is considerable and not limited to short stature. The
severity of PGHD impact on children appears to be variable and individualized, but early
identification and growth hormone treatment may lead to fewer long-term complications.
As depicted in the figure below, growth hormone produces its effects both directly in
peripheral tissues, such as epiphyseal chondrocytes and adipocytes, and indirectly via
stimulation of local and hepatic IGF-1 production. Growth hormone and IGF-1 work in
concert, with IGF-1 augmenting the anabolic actions of growth hormone while opposing the
hyperglycemic and lipolytic effects of growth hormone.
Function of Growth Hormone
Source: Literature Review, Frost & Sullivan Analysis
Insufficient secretion of growth hormones in the human body will reduce these metabolic
effects and limit the growth of muscles and bones. Due to its interaction with growth hormones,
IGF-1 is a well-established PD surrogate endpoint of growth hormone activity and a primary
biomarker of growth hormone efficacy. Lonapegsomatropin is designed as a LAGH therapy to
preserve the MoA of daily hGH, including both direct effects on peripheral tissues and indirect
effects on tissues via stimulation of IGF-1 production, and maintain characteristics of daily
hGH, such as safety, efficacy and tolerability, including lack of immunogenicity.
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MoA of lonapegsomatropin
hGH (somatropin) hGH (somatropin)Inactive Prodrug
Creation of
TransCon Prodrug
TransCon
carrier
TransCon
linker
Predictable release of hGH
in the body
Source: Ascendis Pharma ©
As depicted in the figure above, unmodified 22 kDa growth hormone – the active parent
drug, is bound via a low molecular weight transient conjugation linker to an inert carrier
molecule, methoxypolyethylene glycol (“mPEG”), to create the active product,
lonapegsomatropin. The carrier shields growth hormone from receptor binding and renal
excretion, thus extending its circulation time. With autohydrolysis of the transient conjugation
linker, lonapegsomatropin gradually releases unmodified growth hormone over a one-week
period, designed to maintain similar growth hormone exposure levels and volume of
distribution to those obtained with daily hGH administration. As a result, lonapegsomatropin
offers a convenient once-weekly dosing regimen and thereby significantly reducing the burden
of drug administration. After being released, the unmodified growth hormone binds to a
dimeric hGH receptor in the cell membrane of target cells resulting in intracellular signal
transduction and a host of pharmacodynamic effects. The unmodified growth hormone has
direct tissue and metabolic effects, and indirect effects mediated by IGF-1, including
stimulation of chondrocyte differentiation and proliferation, stimulation of hepatic glucose
output, protein synthesis and lipolysis. It also stimulates skeletal growth in pediatric patients
with GHD as a result of effects on the growth plates (epiphyses) of bones. See “– Transient
Conjugation Technology (TransCon)” for more details regarding the transient conjugation
technology (TransCon). In the global clinical trials conducted by Ascendis Pharma,
lonapegsomatropin had consistently demonstrated IGF-1 levels that are comparable to daily
hGH when administered at an equivalent dose.
Market Opportunity and Competitive Landscape
PGHD is a serious disease that affects children and is characterized by short stature,
metabolic abnormalities and poor quality of life. PGHD can be congenital, acquired, or
idiopathic.
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The prevalence of PGHD in China was 3.4 million in 2023 representing a large market,
especially due to the lack of convenient and effective hGH therapies. The currently available
treatments for PGHD are either daily hGH or LAGH, with the estimated average annual
treatment cost of the currently available LAGH in China being RMB121,333. According to
Frost & Sullivan, the hGH market in China almost tripled from 2018 to 2023 and is estimated
to continue to grow to RMB28.6 billion by 2030, at a CAGR of 13.7% from 2023. From 2018
to 2023, the hGH market in China achieved a higher CAGR than the hGH market in the United
States, according to Frost & Sullivan. China accounted for the largest share of the global hGH
market in 2023, surpassing the United States and representing 34% of the global market.
The increasing market acceptance of premium-valued LAGH will drive a treatment
paradigm shift towards LAGH and the organic growth of the hGH drug market in China. In
addition, as the average duration of treatment and the patient penetration increase, the hGH
market in China is well-positioned to enjoy a strong potential for growth. Favorable
government initiatives are also expected to further drive the growth of the hGH market in
China. “Healthy China Action (2019-2030)” issued by the National Health Commission in
September 2019, for example, announces a national goal to reduce the rate of stunting in
children under the age of five from 8.1% in 2013 to below 7% by 2022 and below 5% by 2030.
Most marketed hGH therapies for PGHD in China are daily hGH treatments, with daily
subcutaneous injections of hGH being the current treatment. However, due to the treatment
burden of daily hGH and associated poor treatment compliance and suboptimal treatment
outcomes, the market has increasingly accepted the paradigm shift from daily hGH treatment
to the LAGH treatment. According to Frost & Sullivan, the LAGH market is projected to
continue to grow significantly and will overtake the daily hGH market.
Currently in China, only one LAGH therapy has received marketing approval and several
are currently under clinical development, as outlined in the tables below. Among the only
marketed LAGH and all LAGH candidates in clinical development in China,
lonapegsomatropin is the only LAGH that has demonstrated superior efficacy and comparable
safety in active-controlled and parallel-group trial comparisons with daily hGH. In addition,
lonapegsomatropin is the only LAGH that releases unmodified hGH in vivo , which is identical
in the molecular form to the endogenous growth hormone secreted by pituitary gland and
preserves its original mode of action. This is in distinction to other LAGH therapies under
development and/or in commercial use in China, where the active components are modified
proteins or peptides that may potentially alter the potency of hGH, its PK or PD profiles, tissue
penetration and receptor binding, and potentially negatively impact drug efficacy and safety.
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Marketed LAGH Therapies in China, as of the Latest Practicable Date*
Brand
Name Company Formulation
Development
Approach
NMPA
Approval Time Indication(s)
Jintrolong (1) GeneScience
Pharmaceuticals
PEGylated hGH Modified hGH 2014 PGHD
Clinical Stage Pipeline LAGH Therapies in China, as of the Latest Practicable Date*
Investigational
Drug Drug Form
Development
Approach Company
Global
Status
China
Status Date** Indication(s)
Lonapegsomatropin Transiently
conjugated
hGH
Unmodified
hGH
VISEN
(2) FDA & EMA
approved (3)
BLA March 7,
2024
PGHD
Y -shaped pegylated
somatropin
PEGylated
hGH
Modified
hGH
Xiamen
Amoytop
Not yet
initiated
BLA January 11,
2024
PGHD
Somapacitan-beco Mutated hGH
attached to
an albumin
affinity tag
Modified
hGH
Novo Nordisk FDA & EMA
approved
BLA September 5,
2024
PGHD
PEG-recombinant
hGH
PEGylated
hGH
Modified
hGH
Anhui Anke Not yet
initiated
Phase 3 November 23,
2017
PGHD
Eftansomatropin
GX-H9/TJ101
Hy-Fc
(Fc fusion
protein)
Modified
hGH
Genexine/
I-Mab
Biopharma
Phase 2
completed
BLA December 7,
2024
PGHD
HSA-recombinant
hGH
HSA/
recombinant
hGH
Modified
hGH
Uniongen Not yet
initiated
Phase 3 May 22, 2024 PGHD
QHRD211/ZHB111 PEGylated
hGH
Modified
hGH
Qianhong
Biopharma
Not yet
initiated
Phase 2/3 August 13,
2024
PGHD
AK2017 Fc fusion
protein
Modified
hGH
Anhui Anke Not yet
initiated
Phase 2 December 27,
2023
PGHD
F-899 (Fc fusion
protein)
Fc fusion
protein
Modified
hGH
Yifan Not yet
initiated
Phase 1 May 28, 2021 N/A
GB08 PEGylated
hGH
Modified
hGH
Kexing
Biopharm
Not yet
initiated
Phase 1 June 7, 2024 PGHD
* All marketed and clinical-stage pipeline LAGH therapies were and/or are being studied in active-controlled
and parallel-group trial comparisons with daily hGH. Pricing information for the marketed LAGH in China
varies across different geographic areas and depends on body weight of the patients. Pricing information is not
available for LAGH therapies in clinical development in China. The route of administration for all marketed
and clinical-stage LAGH therapies in China is in the form of injection.
** Refers to date when the clinical trial information was first publicly posted.
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Notes:
(1) In 2023, the median unit price of Jintrolong in China is RMB3,500/(1ml:54IU). As of the Latest Practicable
Date, Jintrolong has not been included in the NRDL.
(2) VISEN has gained exclusive licensed rights to develop, manufacture and commercialize in China (including
Hong Kong, Macau and Taiwan); Ascendis Pharma has rights to develop, manufacture and commercialize
outside of China (including Hong Kong, Macau and Taiwan).
(3) Lonapegsomatropin is the first once-weekly LAGH approved by both the FDA and EMA for PGHD.
Source: CDE, Frost & Sullivan Analysis
See “Industry Overview – Human Growth Hormone – China hGH Market Landscape” for
more details regarding the market of LAGH in China.
Limitations of Current Treatments and Potential Advantages of Lonapegsomatropin
The current treatment for PGHD is daily subcutaneous injections of hGH. Daily hGH
therapies have been shown to increase growth and improve metabolic effects in children,
including reducing adiposity and improving cardiovascular health. However, daily hGH
requires patients, approximately 93% of which are children, to receive thousands of injections
over the course of many years. The burden of daily administration often results in poor patient
compliance, as supported by a 2021 study. According to Frost & Sullivan, up to 82% of the
patients with PGHD missed at least one daily dose per week. Poor compliance could potentially
lead to suboptimal treatment outcomes. In a separate study of 110 children, two out of three
patients missed more than one injection per week on average, and suboptimal growth outcomes
were observed in patients who missed over one dose per week compared to patients missed no
more than one dose on average.
To overcome the limitations associated with the current treatment, LAGH has been
introduced, aiming to reduce injection frequency and thereby improve compliance and
treatment outcomes. Due to the potential significant advantages of LAGH over daily hGH in
terms of increased acceptance, tolerability, and therapeutic flexibility to patients, LAGH is
expected to gradually replace daily hGH as the standard treatment of care for PGHD. Despite
the potential significant advantage, there are also significant technical entry barriers to
developing LAGH. Out of the nearly 20 LAGHs that were once in the clinical-stage, or even
approved, most did not reach commercial stage primarily due to clinical trial data issue,
including high rate of lipoatrophy at injection site, unsatisfactory IGF-1 profile peak, duration
and presumed unfavorable benefit risk profile ratio, such as PHA-794428 (developed by Pfizer)
and NNC126-0083 (developed by Novo Nordisk) both utilizing PEGylated hGH formulation
and TV-1106 utilizing growth hormone fusion protein (developed by Teva), some reached
commercial stage but were subsequently removed from the market primarily due to factors
including market development strategies, cost considerations and competitive advantages and
disadvantages of the product, such as Nutropin Depot utilizing Depot formulation (developed
by Genentech), and globally only few have demonstrated non-inferior or superior efficacy in
active-controlled and parallel-group trial comparisons with daily hGH. Due to technological
limitations, there remains needs for safe and effective LAGH therapies and long-acting
technologies.
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Enabled by the flexible, versatile and reliable transient conjugation technology
(TransCon), lonapegsomatropin is the first once-weekly LAGH replacement therapy for PGHD
that received marketing approvals from the FDA and the EMA on August 25, 2021 and January
12, 2022, respectively. Lonapegsomatropin is designed based on the transient conjugation
technology (TransCon), which enables extended half-life and therefore a weekly dosing
scheme and the release of unmodified hGH in the bloodstream which is identical to the
endogenous growth hormone. The only marketed LAGH and all LAGH candidates in clinical
development in China, except for lonapegsomatropin, are developed using modified hGH. Due
to its unique features, lonapegsomatropin retains the same mode of action and the same
physiological volume of distribution as the endogenous growth hormone. Endogenous growth
hormone has dual modes of action, with direct action by circulating growth hormone on target
tissues and indirect action by locally produced IGF-1 in the liver (via GHR), while modified
hGH often substantially alters its molecular size, which changes its receptor binding affinity
and its ability to reach the target tissue, and ultimately impacts its efficacy. The active
component of lonapegsomatropin is the released endogenous growth hormone, the safety
profile of which has been clinically proven for almost four decades. In contrast, the modified
LAGH is a new active drug molecule, with no prior clinical safety experience outside of its
clinical trials. Before the endogenous growth hormone is released in the bloodstream,
lonapegsomatropin exists as an inactive prodrug, it therefore presents no biological activities
and is well tolerated at the injection site – subcutaneous tissue. In contrast, some modified
LAGH has shown severe injection site reactions or even lipoatrophy due to high dose and long
exposure of active molecule at the injection site. Due to the design advantages of
lonapegsomatropin, it has proven, in the global and China Phase 3 active-controlled and
parallel-group trial comparisons, superior efficacy to daily hGH, and it has also demonstrated
similar safety to daily hGH. In addition, lonapegsomatropin is coupled with an auto-injector
device that offers easy injection, hidden needle, small injection volume, and six-month room
temperature storage features, all of which can dramatically improve patient injection
experience and compliance, allowing us to develop competitive advantages. The differentiating
design features of lonapegsomatropin can work together to enable a long-acting and
once-weekly hGH replacement therapy in China, that addresses medical needs in growth
hormone therapy by reducing the number of injections patients require, while leveraging the
safety and efficacy database that has been established with unmodified daily hGH products.
See “Industry Overview – Human Growth Hormone – The hGH Market in China” and
“Industry Overview – Human Growth Hormone – China hGH Market Landscape” for more
details regarding the development of hGH.
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Summary of Clinical Results
The following table sets forth an overview of the key clinical studies of the Core Product:
Trial
Sponsor/Subject/
Trial Status Primary Endpoint Secondary Endpoints Trial Key Summary
Phase 3 China Pivotal Trial*
(January 2020 – April 2022)
(NCT04326374)
(52 weeks of treatment period)
 The Company
 Children with GHD
 Completed
AHV at 52 weeks, with a non-inferiority
analysis comparing the difference
between the two treatment groups,
followed by a test of superiority if
non-inferiority was established
AHV over 52 weeks, height SDS and change from baseline
over 52 weeks, IGF-1/IGF-1 SDS and change from baseline,
and normalization of IGF-1 SDS
Safety endpoints: AEs, local tolerability, parameters of glucose
metabolism and lipid parameters, hormone levels, other
hematology and biochemistry blood parameters,
Electrocardiograms (ECGs), vital sign, Bone age (BA)
Pop PK/PD
154 treatment-naïve, pre-pubertal children with GHD were enrolled. Results
from the completed Phase 3 pivotal trial supported that once-weekly
lonapegsomatropin was non-inferior and, additionally, superior to once-
daily hGH on the primary endpoint of AHV at 52 weeks. ANCOV A-
adjusted least squares mean AHV at 52 weeks was 10.66 cm/year for
lonapegsomatropin, compared to 9.75 cm/year for daily hGH, with a
p-value of 0.0010. The estimated treatment difference was 0.91 cm/year
with a 95% confidence interval of 0.37 to 1.45 cm/year.
Phase 3 heiGHt Trial
(pivotal trial)
(December 2016 – January
2019) (NCT02781727)
(52 weeks of treatment period)
 Ascendis Pharma
 Children with GHD
 Completed
AHV at 52 weeks, with a non-inferiority
analysis comparing the difference
between the two treatment groups,
followed by a test of superiority if the
non-inferiority was established
AHV at further visits, change in height SDS, serum IGF-1 and
IGFBP-3, IGF-1 SDS and normalization of IGF-1 SDS,
IGFBP-3 SDS
Safety endpoints: AEs, Clinical laboratory investigations, vital
sign, electrocardiograms (ECGs), Bone age (BA)
PK/PD endpoints
161 treatment-naïve pediatric subjects with GHD were enrolled from 73 sites
across 15 countries. Trial met its primary objective of noninferiority in
AHV and further showed superiority of lonapegsomatropin compared to
daily somatropin, with similar safety, in treatment-naïve children with
GHD. (Paul S. Thornton, et al. J Clin Endocrinol Metab. 2021;106(11):
3184–3195)
Phase 3 fliGHt Trial (switch
trial) (November 2017 –
March 2019) (NCT03305016)
(26 weeks of treatment period)
 Ascendis Pharma
 Children with GHD
 Completed
Safety endpoints: AEs, local tolerability,
antibodies, IGF-1 SDS >2.0, >3.0
with confirmation, HbA1c and lipid,
hormone levels, other hematology and
chemistry parameters, vital sign
Efficacy endpoints as measured at 26 weeks of weekly
lonapegsomatropin treatment included the following: AHV ,
/H9004HSDS, IGF-1 SDS, IGFBP-3 SDS
PK/PD endpoints
Others
146 children with GHD (143 of which were treatment-experienced with daily
somatropin) were enrolled from 28 sites across 4 countries.
Lonapegsomatropin treatment outcomes were as expected across a range
of ages and treatment experiences. Switching to lonapegsomatropin
resulted in a similar AE profile to daily somatropin therapy. (Aristides K
Maniatis, et al. Horm Res Paediatr 2022;95:233-243)
Phase 3 enliGHten Trial
(long-term extension trial)
(December 2017 –
February 2023)
(NCT03344458)
(Up to 4 years of treatment
period)
 Ascendis Pharma
 Children with GHD
 Completed
long-term safety: AEs, antibodies, IGF-1
SDS >2.0, >3.0 with confirmation,
HbA1c and lipids, hormone levels,
other hematology and chemistry
parameters, Vital sign
Long-term efficacy endpoints:
 AHV
 /H9004HSDS
 Proportion of subjects with IGF-1 SDS of 0 to +2.0
 IGF-1 SDS
 IGFBP-3 SDS
Patient-Reported Outcomes
PD endpoints
Nearly all subjects who completed the heiGHt Trial or the fliGHt Trial had
rolled over to the enliGHten Trial for long-term extension studies.
Subjects in the US switched to the lonapegsomatropin Auto-Injector when
available. Long-term data showed that lonapegsomatropin continued to be
safe and well-tolerated, and continued improvement of height SDS through
the second year of therapy without excess advancement of bone age.
(Aristides K Maniatis, et al. J Clin Endocrinol Metab. 2022;107(7):
e2680-e2689)
Note: * We in-licensed lonapegsomatropin from Ascendis Pharma in November 2018. Prior to our in-licensing, lonapegsomatropin had been studied by Ascendis Pharma in over 300 children
with GHD across three Phase 3 programs. Phase 1 trial of performing initial safety or tolerability evaluation in healthy adults and Phase 2 trial of pro of-of-concept studies in China
have been waived by the NMPA.
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VISEN Pharmaceuticals’ Completed Phase 3 Pivotal Trial in Children (Aged 3-17 Years Old)
with GHD, January 2020 - April 2022
We studied lonapegsomatropin in China for PGHD in a Phase 3 pivotal trial. The aim of
this trial is to assess the efficacy, popPK profile, safety and tolerability of lonapegsomatropin
in treatment-naïve, pre-pubertal pediatric subjects with GHD compared to daily hGH as current
treatment in order to support a BLA filing to the NMPA for lonapegsomatropin for PGHD. We
randomized the first patient in China in January 2020, completed target patient enrollment in
March 2021, and completed this trial in April 2022.
Study Design. The Phase 3 pivotal trial was a multi-center, randomized, open-label,
active-controlled trial that enrolled 154 and treated 153
* treatment-naïve, pre-pubertal children
with GHD. The main inclusion criteria included (i) pre-pubertal children with GHD (either
isolated or as part of a multiple pituitary hormone deficiency) in Tanner stage 1, aged three to
17 years old; (ii) impaired height defined as at least 2.0 standard deviation below the mean
height for chronological age and sex according to the Chinese 2005 standard, (iii) body mass
index within ±2.0 standard deviation of the mean body mass index for bone age and sex; (iv)
bone age at least six months less than the chronological age; and (v) baseline IGF-1 level of
at least 1.0 standard deviation below the mean IGF-1 level standardized for age and sex
according to the central laboratory reference values. The main exclusion criteria included (i)
children with a body weight below 12 kg; (ii) prior exposure to recombinant hGH or IGF-1
therapy; and (iii) children with past or present intracranial tumor growth as confirmed by a
sella magnetic resonance imaging scan at screening. Out of these 153 randomized and dosed
subjects, one withdrew from the study due to an AE which was not related to
lonapegsomatropin according to the investigator, and one withdrew voluntarily, resulting in a
total of 151 subjects completed the trial.
Summary of Study Disposition
Lonapegsomatropin
(N=101)
n (%)
Daily
recombinant
human
growth
hormone
(“rhGH”)
(N=53)
n (%)
Total
(N=154)
n (%)
Number of Subjects Randomized
and Dosed 100 (99.0) 53 (100) 153 (99.4)
Study Completion Status
Completed 98 (97.0) 53 (100) 151 (98.1)
Discontinued 3 (3.0) 0 3 (1.9)
Adverse Event 1 (1.0) 0 1 (0.6)
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Lonapegsomatropin
(N=101)
n (%)
Daily
recombinant
human
growth
hormone
(“rhGH”)
(N=53)
n (%)
Total
(N=154)
n (%)
Lost to Follow-up 0 0 0
Physician Decision 0 0 0
Trial Site Terminated by Sponsor 0 0 0
Study Terminated by Sponsor 0 0 0
Study Subject Withdrawal by
Parent or Guardian* 1 (1.0) 0 1 (0.6)
Withdrawal by Subject 0 0 0
Lack of Efficacy 0 0 0
V oluntary withdrawal 1 (1.0) 0 1 (0.6)
* One child dropped out prior to receiving treatment due to reasons unrelated to the clinical trial.
Subjects were randomized in a 2:1 ratio into one of the two treatment groups –
once-weekly injections of lonapegsomatropin at 0.24 mg/kg/week or daily injections of
recombinant hGH (Norditropin®) at 34 µg/kg/day, which is equivalent to 0.24 mg/kg/week.
The primary endpoint for this trial was to demonstrate non-inferiority, and if achieved,
superiority of lonapegsomatropin in comparison to daily hGH on AHV at 52 weeks. The
secondary endpoints for this trial were to evaluate the safety, tolerability, popPK and PD
profiles of lonapegsomatropin in pediatric subjects with GHD. Based on the low
immunogenicity of lonapegsomatropin as supported by its MoA and demonstrated in the global
trial, immunogenicity was not evaluated in the China Phase 3 pivotal trial.
Waiver of Individual PK Studies. A unique aspect of the study design of this Phase 3
pivotal trial is the waiver of individual PK studies from the trial protocol and the introduction
of popPK as a secondary endpoint to study hGH concentrations within the study group that
receives once-weekly injections of lonapegsomatropin. PopPK has become a popular method
especially in children, due to the potential for sparse sampling, flexible sampling times,
computing of heterogeneous data, and identification of variability sources. This design allows
us to utilize PK data collected from different pediatric subjects to simulate the PK profile with
mathematical models.
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Efficacy Results. Results from the completed Phase 3 pivotal trial supported that
once-weekly lonapegsomatropin was non-inferior and, additionally, superior to once-daily
hGH on the primary endpoint of AHV at 52 weeks. ANCOV A-adjusted least squares mean AHV
at 52 weeks was 10.66 cm/year for lonapegsomatropin, compared to 9.75 cm/year for daily
hGH, with a p-value of 0.0010. The estimated treatment difference was 0.91 cm/year with a
95% confidence interval of 0.37 to 1.45 cm/year. The treatment difference reached statistical
significance of change in height SDS from baseline ( /H9004height SDS) from and including 13
weeks onwards. Multiple pre-specified sensitivity analyses were completed and reinforced the
robustness of these results.
Primary Efficacy Endpoint at 52 Weeks
Lonapegsomatropin
(N=100)
Daily rhGH
(N=53)
AHV (cm/year)
Least square mean (standard error) 10.66 (0.22) 9.75 (0.26)
Least square mean difference
(standard error) 0.91 (0.28)
Difference (95% confidence interval) (0.37, 1.45)
P-value 0.0010
Height SDS at 52 weeks increased over baseline by 1.01 for lonapegsomatropin and by
0.83 for daily hGH, with a p-value of 0.0015, and statistical significance of change in height
SDS from baseline ( /H9004height SDS) was demonstrated in the lonapegsomatropin group from and
including 13 weeks onwards. The results were consistent with the efficacy results from the
global Phase 3 program of lonapegsomatropin conducted by Ascendis Pharma that supported
the FDA and EMA approvals.
Height SDS Improvement at 52 Weeks
Lonapegsomatropin
(N=100)
Daily rhGH
(N=53)
Height SDS Change from Baseline
Least square mean (standard error) 1.01 (0.04) 0.83 (0.05)
P-value 0.0015
According to the results, average IGF-1 SDS for both lonapegsomatropin and daily hGH
generally increased within normal range over 52 weeks and was relatively higher for
lonapegsomatropin than daily hGH (0.76~1.45 vs -0.3~0.3 over 52 weeks), which appeared to
parallel the superior growth outcomes observed for lonapegsomatropin relative to daily hGH.
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Average IGF-1 SDS Over 52 Weeks for the Subjects
Lonapegsomatropin
(N=100)
Daily rhGH
(N=53)
Least Square Mean (Standard Error)
Average IGF-1 SDS
Week 5 0.76 (0.12) -0.27 (0.15)
Week 13 1.52 (0.10) -0.03 (0.12)
Week 26 1.31 (0.12) 0.09 (0.14)
Week 39 -0.11 (0.10) 0.30 (0.13)
Week 52 1.45 (0.14) 0.17 (0.16)
Safety and Tolerability Results. The results indicated that lonapegsomatropin was
generally safe and well-tolerated, with AEs consistent with the type and frequency observed
with daily hGH therapy and comparable between arms of the trial. The incidence of AEs was
similar between lonapegsomatropin and daily rhGH groups (98.0% vs. 94.3%). Most TEAEs
were mild (88.2% in total) to moderate (7.2% in total), and only two severe AEs occurred in
the lonapegsomatropin group (bronchitis and bacterial tonsillitis). Both were not related to
lonapegsomatropin, according to the investigator. The most common AEs in patients
administered lonapegsomatropin or daily hGH were upper respiratory tract infection. Reported
SAEs and SAEs related to lonapegsomatropin and daily hGH were infrequent and similar
between arms of the trial. Two patients experienced AEs that led to the discontinuation of
lonapegsomatropin, but only one (subcutaneous abscess) was possibly related to
lonapegsomatropin, according to the investigator. No deaths were reported in either arm. As
such, we believe the occurrence of SAEs has no material adverse impact on the clinical
development and future commercialization of the Core Product. Throughout the trial, blood
glucose were generally stable and remained within the normal range for both arms. Other
laboratory parameters were also similar between arms of the trial. The safety and tolerability
results from this China Phase 3 pivotal trial are consistent with the safety and tolerability
results from the global Phase 3 program of lonapegsomatropin that supported its FDA and
EMA approvals.
Overall TEAE Summary
Lonapegsomatropin
(N=100) n (%)
Daily rhGH
(N=53) n (%)
Total
(N=153) n (%)
TEAE 98 (98.0) 50 (94.3) 148 (96.7)
Mild 89 (89.0) 46 (86.8) 135 (88.2)
Moderate 7 (7.0) 4 (7.5) 11 (7.2)
Severe 2 (2.0) 0 2 (1.3)
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Future Clinical Development Plan
Under the relevant Exclusive License Agreement, we are able to select the indication(s)
for development of lonapegsomatropin in China (including Hong Kong, Macau and Taiwan).
Therefore, in addition to rapidly advancing in clinical development of our three drug
candidates, we will further develop our Core Product, lonapegsomatropin, to cover more
indications that may be eligible for hGH treatment, including other pediatric pathological short
stature diseases such as ISS. As discussed in more details below, we intend to conduct a
multi-center, randomized, open-label, active-controlled, parallel-group Phase 2b/3 trial to
investigate the efficacy and safety of Core Product in children with ISS, with ongoing updates
to the trial protocol.
ISS is defined as a condition characterized by a height more than 2 SD below
corresponding average height for a given age, sex and population without evidence of
underlying disease. Children with ISS, constituting approximately 38.8% of individuals with
short stature, represent the majority in need of non-traditional use of human growth hormone.
Given such circumstance, we plan to study our Core Product, lonapegsomatropin, in mainland
China for ISS in a Phase 2b/3 trial. The aim of the trial would be to evaluate the effect of the
Core Product on promoting growth in children with ISS and its safety profile, to support the
application of ISS indication. The Phase 2b/3 trial is planned to be designed as a multi-center,
randomized, open-label, active-controlled, parallel-group trial that seamlessly integrates
dose-finding and efficacy confirmatory phases, aiming to efficiently determine the optimal
dosage for subsequent phase 3 efficacy evaluation. The local manufacturing of
lonapegsomatropin drug products will be used as investigational medicinal product (“IMP”) in
the Phase 2b/3 trial for ISS. We plan to prepare the study design, develop the study protocol
synopsis, manufacture IMP for clinical trial, conduct the necessary CMC and non-clinical
studies, and apply for pre-IND communication with NMPA following the completion of the
Listing.
Licenses, Rights and Obligations
We hold exclusive rights to develop, manufacture and commercialize lonapegsomatropin
in China (including Hong Kong, Macau and Taiwan) on a royalty-free basis. See “–
Collaborations – Exclusive License Agreements with Ascendis Pharma” for more details
regarding our exclusive license arrangements with Ascendis Pharma.
Our R&D Work
We have been the sole sponsor of China clinical study and remain in charge of the clinical
development process in China since in-licensing of lonapegsomatropin. As further disclosed
below, we are fully responsible for the following aspects of the R&D activities for the
development of lonapegsomatropin in China: (i) IND preparation, (ii) pre-IND communication
and IND approval, (iii) trial preparation of site selection, (iv) clinical trial personnel training,
(v) medical monitoring and data management, (vi) statistical management, (vii) patient
enrollment, and (viii) BLA preparation, and have exclusive control over the supervision of
clinical sites as well as the coordination of external vendors. We have the research expertise
or access to the research expertise required for the development of lonapegsomatropin,
including medical science, regulatory, clinical operation, quality assurance, pharmacovigilance
and data management, statistics and medical affairs.
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We incurred R&D expenses of RMB106.2 million, RMB28.7 million and RMB24.4
million on the development of lonapegsomatropin for the treatment of PGHD in 2022, 2023
and the nine months ended September 30, 2024, respectively, accounting for 59.1%, 49.8% and
41.4% of our total research and development costs, respectively, for the same periods. See
“Financial Information” for more details. We anticipate incurring additional costs and expenses
in connection with our future R&D work as discussed below.
During the Track Record Period, we procured R&D consulting services from Ascendis
Pharma mainly for the pharmacovigilance and biometry for data analysis including statistical
programming and statistical analysis, and the regulatory strategy advice and documentation
support to prepare for our Import BLA submission package with the NMPA, which, as advised
by Frost & Sullivan, is consistent with the industry practice. The amount of R&D consulting
services rendered by Ascendis Pharma relating to lonapegsomatropin was RMB7.0 million,
RMB6.3 million and RMB5.3 million in 2022, 2023 and the nine months ended September 30,
2024, respectively.
IND Preparation
Upon receiving the relevant clinical data from Ascendis Pharma, we reviewed all the data
generated from the global trials of lonapegsomatropin, and quickly began to prepare for
clinical initiations in China. We developed a study protocol taking into consideration of the
specific disease epidemiology, disease characteristics, domestic clinical practice as well as the
current status of hGH market in China.
To ensure smooth initiation and operation of scientifically-sound studies, we set up a
steering committee comprising KOLs, overseas clinical professional experts and
biostatisticians. Three investigators sit in the steering committee, including Professor Xiaoping
Luo, who holds various positions in Tongji Hospital, Tongji Medical College of Huazhong
University of Science and Technology, Professor Junfen Fu from Children’s Hospital of
Zhejiang University School of Medicine and Professor Chunxiu Gong from Beijing Children’s
Hospital. Professor Ruihua Sun from China-Japan Friendship Hospital and Professor Martin O.
Savage from London, United Kingdom are the Biostatical Expert and Consultant of the steering
committee, respectively. From January to March 2019, our R&D team organized a number of
meetings with the KOLs to optimize the study designs for lonapegsomatropin. The design of
studies has taken into consideration of both (i) the scientific rationale, such as MoA,
pre-clinical data, available global clinical data, and development opportunity, and (ii) market
opportunities in China, such as addressable patient population, product positioning and
competitive landscape of lonapegsomatropin.
Pre-IND Communication and IND Approval
On April 1, 2019, we initiated pre-IND communication with the CDE, seeking their
opinions on our study designs, including with respect to the size of the patient enrollment,
option to conduct popPK studies, waiver of individual PK study and immunogenic assay, and
option to advance lonapegsomatropin directly into Phase 3 pivotal trial in children with GHD
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in China in light of the clinical data generated by Ascendis Pharma from the global clinical
trials of lonapegsomatropin, without performing initial safety or tolerability evaluation in
healthy adults in a Phase 1 trial or proof-of-concept studies in a Phase 2 trial. To support our
proposal to waive individual PK study, we have identified the Asian population from a
bioequivalence Phase 1 clinical trial conducted by Ascendis Pharma and demonstrated in the
pre-IND communication that no difference in PK profile was observed between the Asian
group and the non-Asian group. During pre-IND communication, waiver of immunogenic assay
was also accepted by CDE. Following several rounds of communication with the CDE, we
considered all suggestions from the CDE and submitted an IND application in July 2019, which
was accepted by the NMPA on August 9, 2019. On October 25, 2019, we obtained the IND
approval from the NMPA with no negative feedback for the proposed clinical development plan
and the trial design of Phase 3 pivotal trial of lonapegsomatropin.
Trial Preparation of Site Selection
We conducted a number of activities in connection with trial preparation and site
selection, including:
 Developing and approving trial-related documentation, including, without
limitation, the finalized protocol, informed consent form, case report form;
 Assessing potential challenges and risk for study conduct and other medical
considerations;
 Establishing operational strategies including enrollment strategy;
 Evaluating site feasibility and preparing related submission to Human Genetics
Resources Administration of China (“HGRAC”); and
 Ensuring all study preparation including investigational drug and clinical supplies
was ready before the first patient was randomized.
Leveraging our insights and expertise in the endocrinology field, we managed to obtain
the HGRAC approval and complete site initiation in an efficient manner and at a record speed:
On November 26, 2019, 31 days after obtaining the IND approval, we obtained an approval
from the HGRAC to commence the Phase 3 pivotal trial. Subsequently on December 23, 2019,
we completed the first site initiation. Overall, we engaged a total of 17 GCP certified
investigational sites specialized in pediatric endocrinology for the Phase 3 pivotal trial.
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Clinical Trial Personnel Training
In order to complete a smooth and high-quality Phase 3 pivotal trial, we designed a
systematic training program with respect to the equipment to be used for the Phase 3 pivotal
trial, including:
 Anthropometer measurement of the height of patients for the assessment of the
primary endpoint for this trial (AHV at 52 weeks);
 Electronic data capture (“EDC”) system that collects the clinical data in electronic
format;
 Interactive response technology (“IRT”) that automates patient randomization, kit
assignment, drug supply, and inventory management;
 Central lab system that collects blood samples; and
 Central image system that measures bone age.
We also conducted training for investigators and sub-investigators at site initiation visit
of each clinical site.
Medical Monitoring and Data Management
We developed a comprehensive medical monitoring and data management plan
encompassing the following:
 Monthly monitoring of medical data. Our medical and clinical development
department reviews the medical data with CRO once a month, analyzing screening
situation, inclusion and exclusion criteria, follow-up information and safety
information of the subjects in combination with the study protocol. The Phase 3
pivotal trial used Medidata’s Rave EDC system to collect the clinical trial data at the
sites. Data were entered into the electronic case report form (“eCRF”) from the
source documents by designated investigational site staff using single data entry
with electronic verification. In general, queries were sent to the investigational site
using an electronic data query system which provided an automatic audit trail of the
corrections made by designated investigational site staff. Laboratory data will be
uploaded in the central lab’s own system and data will transfer regularly. After the
data had been entered and saved, various edit checks were performed for the purpose
of ensuring the accuracy, integrity, and validity of the collected data. Under our
standard, 100% quality control (“QC”) check and 0% error rate are required for key
safety and efficacy (critical) variables. During the trial, we continuously monitor the
quality of data entry services provided by CROs, including the progress report, data
entry rate, source data verification (“SDV”) rate, open query rate, missing page
numbers, medical coding correctness, external data transfer, safety data
reconciliation with pharmacovigilance database.
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 Data surveillance and data dry run. To ensure the data entry quality and early
detection of any signal in safety and trial conduction, we have completed two rounds
of data surveillance, upon 20% and 50% patient enrollment, respectively, and
conducted four rounds of data dry run every three months, upon 80%, 100%, 100%
and 100% patient enrollment, respectively, and before database lock on March 8,
2021, June 4, 2021, September 6, 2021 and December 6, 2021, respectively. No
major issues with respect to data quality or entry were observed during the data
surveillance and data dry runs.
 Real-time communication of AEs. Our clinical operation team communicated with
the CRO timely for AEs in clinical trials. Our clinical operation team and medical
team discussed the types of AEs, completed reports according to the operating
procedures timely and analyzed the severity of AEs and their correlation to
lonapegsomatropin. For reported SAEs, CRO pharmacovigilance staff and medical
staff and our clinical operation team sent the inquiry to the investigators. The
investigators then completed the follow-up report form with the follow-up
information of the subjects.
 Real-time communication of protocol deviation cases. Our medical and clinical
development led the adoption and modification of clinical trial plans of
lonapegsomatropin, managed the overall operation and reporting of CRO and
provided guidance for daily work and development of CRO. Our medical and
clinical development department communicated with the CRO timely to discuss
protocol deviation cases, analyzed the causes and solutions for each case, and
provided feedback to clinical supervisors and main researchers to avoid the
recurrence of such events.
Statistical Management
We established a dedicated team responsible for the statistical analysis of the study, with
support from Ascendis Pharma. The efficacy analyses, including the primary efficacy analysis
for the primary endpoint were based on the intention to treat population. The sensitivity
analysis for the primary endpoint was performed based on the Per Protocol (“PP”) population,
and the PP population was analyzed based on the actual treatment given. AHV at 52 weeks of
lonapegsomatropin was compared to that of daily hGH by a non-inferiority comparison with
a margin of 2.0 cm/year. Once non-inferiority in AHV was established, subsequent hypothesis
testing for superiority were conducted. For the primary efficacy analysis, a two-sided 95%
internal was calculated for the difference in least square means between the two treatment
groups (i.e., AHV at 52 weeks in the lonapegsomatropin treatment group minus that in the daily
hGH treatment group). Results from the completed Phase 3 pivotal trial supported that
once-weekly lonapegsomatropin was non-inferior and, additionally, superior to once-daily
hGH on the primary endpoint of AHV at 52 weeks.
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Patient Enrollment
In January 2020, we randomized the first patient in China for the Phase 3 pivotal trial.
Patient enrollment was then put on temporary hold for at least four months due to the close of
pediatric outpatient departments in response to the outbreak of COVID-19 in China in early
2020. After the hospitals re-opened in April 2020, we leveraged our strong site engagement and
clinical development capabilities to complete site initiations for the remaining nine sites
selected by us at that time within 36 days, demonstrating strong execution efficiency. Since
October 2020, we have implemented strategies to achieve our patient enrollment goals,
including adding new sites, enhancing site selection processes, efficiently obtaining HGRAC
approval, and completing site initiation activities. On March 31, 2021, we completed patient
enrollment for the Phase 3 pivotal trial for lonapegsomatropin according to our initial targeted
timeline without any early termination or suspension of our clinical trials despite the disruption
of COVID-19 pandemic and clinical site lock-down, highlighting the strong execution
capabilities of our management and clinical R&D team.
Trial Completion
We conducted a number of R&D activities relating to clinical trial execution, including,
without limitation, clinical trial personnel training; investigational site initiation, management
and monitoring; medical and safety monitoring; data management; pharmacovigilance; quality
assurance; and clinical data collection and vendor management. We independently completed
the Phase 3 pivotal trial of the Core Product in April 2022.
Data analysis and Clinical Study Report (Main CSR and PopPK/PD Report)
We conducted several R&D activities relating to clinical trial data analysis, data reporting
and clinical study report (“CSR”) developing after the completion of Phase 3 pivotal trial,
including, without limitation, clinical data cleaning, clinical data reconciliation, clinical
database lock, statistical analysis, data interpretation and CSR development. Following the
achievement of clinical data lock on April 29, 2022, within one month after the completion of
Phase 3 pivotal trial (the top performance in local market), the statistical analysis and data
interpretation was conducted and CSR was drafted in compliance with the ICH E3 Structure
and Content of Clinical Study Reports – Scientific Guideline (“ICH E3 Guideline”) published
by International Council on Harmonisation of Technical Requirements for Registration of
Pharmaceuticals for Human Use (“ICH”) and local regulations. According to the Phase 3 China
study design approved by the CDE and the ethics committee, two CSRs are developed to
include main clinical study results (“Main CSR”) and PopPK and PD analysis results
(“PopPK/PD report”) of PGHD population in China. PopPK/PD report is to characterize the PK
and PD profile based on legacy global population PK model. After testing the collected blood
samples during the last patient last visit in April 2022, PK sample analysis for the Phase 3
pivotal trial was concluded by the end of April 2022. Subsequently, all PK data were
transferred to a third-party organization for PK and PD modelling and analysis. Main CSR is
an integrated full report that combines clinical and statistical descriptions, presentations, and
analyses into a single document, following ICH E3 guidelines, with tables, figures, and
appendices incorporated within or at the end of the text. The PopPK/PD report and Main CSR
were completed on November 17, 2022 and March 29, 2023, respectively.
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Given the above circumstance, NMPA agreed to waive the requirements of individual
phase 1 PK study and phase 2 study (proof-of-concept) in China and confirmed the sufficiency
of a confirmatory Phase 3 study including PopPK and PD in the registration process of China.
The R&D process for the Core Product is faster than normal practice within the industry. The
drug development process normally progresses from one stage to another with the support of
pre-clinical and clinical data. Even for overseas imported drugs, regulatory authorities in China
typically require independent Phase 1 PK study and Phase 3 study for registration purposes.
However, considering the entire R&D efforts for the Core Product, we have managed to
expedite such process.
BLA Dossier Preparation
As required by ICH and NMPA to continuously consolidate BLA submission package, we
compiled a substantial number of documents based on data of global and local studies in four
categories, including clinical documents, non-clinical documents, CMC documents and
administrative documents. BLA application is designed for imported drugs that have already
approved and commercially available overseas. According to the ICH M4E Common technical
document for the registration of pharmaceuticals for human use – efficacy (“ICH M4E(R2)
Guideline”), an internationally recognized guideline that plays a pivotal role in the field, if the
drug has already been marketed, post-marketing data, including safety reports, should be
summarized when available. The Guiding Principles for New Drug Clinical Safety Evaluation
Techniques () also mentions the necessity to refer to
the ICH M4E(R2) Guideline for other clinical safety principles.
In light of such guidelines, we decided to incorporate global safety data in line with those
in the most recent global safety report submitted to the FDA as of August 25, 2023 into BLA
dossier for the following reasons: (i) the BLA filing submission package in China would have
contained the most up-to-date data and accurate data; and (ii) it would be a responsible and
ethical approach for the Company to benefit the PGHD population in China. This required
additional time for data collection, analysis, and comparison to ensure the inclusion of accurate
and comprehensive data after August 25, 2023, the data collection cut-off date for the latest
periodic safety report. We have updated the BLA submission package according to the global
safety data since November 2023 and completed such update in January 2024.
Material Communications and BLA Submission with the NMPA
Material Communications Before Completion of the Phase 3 Pivotal Trial
On April 1, 2019, we initiated pre-IND communications with the NMPA, seeking the
NMPA ’s opinions on our study design. See “– Our Drug Pipeline – Lonapegsomatropin – A
Long-Acting hGH Replacement Therapy for PGHD – Our R&D Work – Pre-IND
Communication and IND Approval” for more details regarding the pre-IND communications.
We did not receive any negative feedback from the NMPA on our proposed trial design.
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On August 9, 2019, our IND application was accepted by the NMPA. Subsequently on
October 25, 2019, we obtained the IND approval from the NMPA to directly advance
lonapegsomatropin to a Phase 3 pivotal trial in pediatric patients with GHD.
Material Communications After Completion of the Phase 3 Pivotal Trial
On March 31, 2023, we informed the NMPA of the completion status of our Phase 3
pivotal trial with results summary through the Drug Clinical Trial Registration and Information
Publicity Platform which, as advised by our PRC Legal Adviser, is an official trial registration
and publicity platform operated by the CDE which is a subdivision of NMPA whose function
includes acceptance and technical evaluation of drug clinical trials and drug marketing
authorization applications. The trial status on such platform was subsequently shown as
“completed” on April 4, 2023 which, as advised by our PRC Legal Adviser, demonstrated that
CDE has reviewed the materials submitted by us and agreed to reflect our Phase 3 pivotal trial
status as “completed” for public review.
Following the completion of the Phase 3 pivotal trial, we engaged in the following formal
communication with the NMPA in accordance with the Administrative Measures for
Communication of Drug R&D and Technical Review (၍ଣ፬
).
Pursuant to such measures, a company that intends to make a BLA filing (a “BLA
applicant”) for a therapeutic biological product is required in principal to submit
communication application to the CDE of the NMPA to discuss with the regulator whether the
research data available satisfies the technical requirement to make a BLA filing. Upon
receiving the application, the CDE of the NMPA is required to carry out a two-tier review: first
to preliminarily verify whether information in the application is satisfactory and then to
perform a complete review of the documents received. The CDE of the NMPA will schedule
a communication meeting with the applicant unless it has provided written response or the
matters raised by the applicant are resolved. Since lonapegsomatropin is a therapeutic
biological product within the meaning of the aforementioned measures, we have completed the
required communication process as set forth in more details below.
On May 31, 2023, we submitted a formal communication application package to the CDE
of the NMPA, seeking their opinions on matters concerning, among other things, the
completion of the Core Product’s Phase 3 pivotal trial, and the permission of BLA filing of the
Core Product in China for PGHD.
On June 19, 2023, we received official response in writing from the CDE of the NMPA,
confirming that (i) the Core Product’s Phase 3 pivotal trial was completed; (ii) primary
endpoint of the trial demonstrate: (a) superiority efficacy over daily hGH in terms of 52-week
AHV which is consistent with results from the global clinical trials; and (b) similar safety
profile comparing to daily growth hormone products; and (iii) based on the data provided, the
CDE of the NMPA agrees for us to proceed with our BLA filing of the Core Product for the
treatment of PGHD.
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BLA Submission with the NMP A
We made the BLA filing with the NMPA on January 18, 2024 for our Core Product for
the treatment of PGHD, after which we submitted supplemental administrative materials per
request from the CDE of the NMPA, and the BLA filing was subsequently accepted by the
NMPA on March 7, 2024. After the completion of our Core Product China Phase 3 pivotal trial
in April 2022, we hold our submission of BLA filing with the NMPA until January 2024,
primarily due to the following: (i) we have observed the necessity to incorporate the global
safety data from the latest periodic safety report of Ascendis Pharma with a data collection
cut-off date of August 25, 2023 into our BLA submission package with the NMPA, which we
believe will bring us in line with international practices and domestic guidelines and may
facilitate the BLA review process. See “– Our Drug Pipeline – Lonapegsomatropin – A
Long-Acting hGH Replacement Therapy for PGHD – Our R&D Work – BLA Dossier
Preparation” for more details; (ii) to ensure compliance with our Core Product Phase 3 China
study design approved by the CDE and the ethics committee, the population pharmacokinetic
(popPK) and pharmacodynamics (PD) analysis was conducted and concluded in November
2022; and (iii) we initiated a restructuring and reduced our staff counts in the first quarter of
2023 in light of the challenging market conditions, which had temporarily delayed our BLA
submission workstream.
We are not aware of any legal claims or proceedings that may have an adverse effect on
our development for lonapegsomatropin for the treatment of PGHD in China. As of the Latest
Practicable Date, we have not received objections to our clinical development plans with
respect to the regulatory review or approval process of lonapegsomatropin in China.
BLA Approval Analysis
We expect to receive the BLA approval for the Core Product for the treatment of PGHD
in the second half of 2025 and we reasonably believe that it is unlikely that additional clinical
trials will be required by the NMPA before the obtaining of the BLA approval for the Core
Product in China, given the following considerations:
 The expected BLA approval for the Core Product in the second half of 2025 aligns
with the current industry practice. As advised by Frost & Sullivan, according to
historical data from the NMPA, the average time between receiving the market
application acceptance notice from the NMPA and receiving the new drug approval
from the NMPA for Class 3.1 biopharmaceutical new drugs (approved for overseas
marketing but not yet approved in China) since 2020 is approximately 445 days for
completely new applications excluding those for adding new indications, similar to
our case, and 376 days including applications for adding new indications. In
addition, the time required for CDE review may be extended by up to an additional
90 working days according to relevant regulations if additional sample testing and
specification verification work is involved. The BLA filing for the Core Product for
the treatment of PGHD, a Class 3.1 biopharmaceutical new drug application, was
accepted by the NMPA on March 7, 2024, and on October 11, 2024, we received a
notice from the CDE requesting supplementary information in which no supplement
clinical data were requested and we duly submitted such supplemental information
with the CDE in January 2025. In light of the foregoing, we believe that the timeline
for receiving NMPA approval in the second half of 2025 aligns with the current
industry practice with respect to the NMPA ’s review process.
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 The approval rate for hGH products, especially LAGH, after BLA filing is high. As
advised by Frost & Sullivan, the approval rate by the NMPA for hGH products that
have submitted new drug applications, including those withdrawn from marketing,
is over 90%. Among all hGH products, only one LAGH drug has submitted new drug
application and received the marketing approval, resulting in a 100% success rate
for marketing approval of LAGH products. As further advised by Frost & Sullivan,
for these approved hGH products, NMPA did not request further clinical trials to be
conducted during the review process and NMPA approved such drugs on their first
new drug application.
 The approval rate of Class 3.1 new drug application by the NMP A is high. As
advised by Frost & Sullivan, the approval rate by the NMPA since 2020 for the new
drug application of Class 3.1 biopharmaceutical drugs that have already been
approved overseas and conducted corresponding clinical trials in China, is 100%,
and such Class 3.1 biopharmaceutical drugs were approved on their first new drug
application, indicating that the possibility of the NMPA requiring substantial and
additional clinical trial is remote.
 We reasonably believe that it is unlikely that additional new clinical trials will be
required during the review process for the Core Product BLA application, given that:
(i) the Phase 3 pivotal trial study protocol in China for the Core Product, including
study endpoint, has been approved by the NMPA; (ii) the Phase 3 pivotal trial
conducted by us in China adhered to the study protocol approved by both the NMPA
and the ethics committee; (iii) the Phase 3 pivotal trial design in China complies
with and meets the requirements outlined in the Clinical Trial Technical Guidance
Principles for Growth Hormone Formulations in Growth Hormone Deficiency (ڗ
ۆࡡissued by the CDE of the
NMPA in February 2024; (iv) the results of the Phase 3 pivotal trial in China have
achieved the primary endpoint and secondary endpoints, indicating that the Core
Product was generally safe and well-tolerated, and are consistent with the efficacy,
safety and tolerability results from the global Phase 3 program that supported its
approvals from the FDA and the EMA; and (v) on June 19, 2023, we received
official response in writing from the CDE of the NMPA, confirming that (a) the Core
Product’s Phase 3 pivotal trial was completed; (b) primary endpoint of the trial
demonstrate: (1) superiority efficacy over daily hGH in terms of 52-week AHV
which is consistent with results from the global clinical trials; and (2) similar safety
profile comparing to daily growth hormone products; and (c) based on the data
provided, the CDE of the NMPA agrees for us to proceed with the BLA filing of the
Core Product for the treatment of PGHD.
Having considered (i) the view of Frost & Sullivan, regarding the success rate of
marketing approval of hGH products and LAGH drug and that NMPA did not request further
clinical trials to be conducted during the review process and NMPA approved such drugs on
their first new drug application as stated above; and (ii) each of the basis for our expectation
to receive the BLA approval for the Core Product for the treatment of PGHD as stated above,
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our Directors are of the view that it is unlikely that additional new clinical trials will be
required during the review process for the Core Product BLA application and we expect to
receive the BLA approval for the Core Product for the treatment of PGHD in the second half
of 2025. The Joint Sponsors, on the basis of above and independent due diligence conducted,
are of the view that it is unlikely that additional new clinical trials will be required during the
review process for the Core Product BLA application.
Our Future R&D Work
We expect to engage in additional R&D work in connection with the regulatory filings in
China, which includes product registration testing associated with the verification of
lonapegsomatropin to support our BLA approval for the treatment of PGHD. Under the
Exclusive License Agreement, we have the sole responsibility for obtaining and maintaining
regulatory approvals for lonapegsomatropin in China (including Hong Kong, Macau and
Taiwan). In connection with the preparation of such regulatory filings, we expect to receive
consulting services from Ascendis Pharma mainly for (i) the technology transfer of
lonapegsomatropin drug substance from Ascendis Pharma to us, and (ii) consulting the
technology localization process that involves the lonapegsomatropin drug substance
manufacturing scale-up.
Subsequent to the BLA approval from the NMPA, if obtained, we expect to submit a
separate BLA, the Local BLA, to the NMPA to enable the local manufacturing of
lonapegsomatropin in China in the future. The Local BLA is separate from the Import BLA
approval that only allows a company to import and commercialize drug products that are
manufactured overseas. As advised by the PRC Legal Adviser, the Import BLA only allows us
to import and commercialize lonapegsomatropin in China, whereas the Local BLA will allow
us to locally manufacture and commercialize lonapegsomatropin in China. It is also customary
practice to obtain an Import BLA prior to the Local BLA in order to realize near-term revenue
benefits while establishing local manufacturing capabilities, as advised by Frost & Sullivan. As
part of the Local BLA filing, we are required to furnish, among other materials, a drug
manufacturing certificate, which certifies the local manufacturing capabilities of the
manufacturing facility. Under the Drug Administration Law, we will also attain marketing
authorization holder status as we hold the drug approval license. For more details regarding the
Import BLA and Local BLA, refer to “Risk Factors – Key Risks Related to Our Business,
Business Operations, Intellectual Property, Regulatory Approval of Our Drug Candidates,
Commercialization and Financial Prospects – Under China’s regulatory framework, in addition
to obtaining marketing approval for commercializing imported drug products, a separate
marketing approval from the NMPA is required to commercialize locally manufactured drug
products. If we are unable to obtain marketing approval to commercialize locally manufactured
drug products, our business prospects will be adversely affected, which will ultimately affect
our long-term profitability” and “Regulatory Environment – Regulations on Pharmaceutical
Product Development, Approval and Registration in the PRC – Regulations on the Clinical
Trials and Registration of Drugs - Drug Marketing Registration.”
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To prepare for the Local BLA submission, we expect to engage in further R&D work
relating to the following:
 process development, optimization studies, analytical methods and verification
studies to verify the transferred process and methods in 2024 and 2025. These
processes establish the blueprints for the development of drug substance and drug
product from laboratory scale to manufacturing scale;
 engineering runs in 2026, including (i) drug substance engineering runs; and (ii)
drug product engineering runs. These runs will ensure the scale-up process works for
drug substance and drug product production; and
 process performance qualification (“PPQ”) runs in 2026 and 2027, including (i) drug
substance PPQ runs; and (ii) drug product PPQ runs. These runs will ensure that the
commercial manufacturing process for drug substance and drug product can be
operated consistently and within the predefined parameters and therefore to produce
the consistent commercial lonapegsomatropin drug substance and drug product.
For more details, refer to “– Research and Development – CMC Development Programs”
and “Future Plans and Use of Proceeds – Use of Proceeds.”
WE MAY NOT BE ABLE TO ULTIMATELY DEVELOP AND MARKET
LONAPEGSOMATROPIN IN CHINA (INCLUDING HONG KONG, MACAU AND
TAIWAN) SUCCESSFULLY .
TransCon CNP (navepegritide) – A Disease-Modifying Therapy for ACH
Overview
TransCon CNP (navepegritide) is a disease-modifying long-acting prodrug of CNP in
development for the treatment of ACH in children in China (including Hong Kong, Macau and
Taiwan), for which there is currently no effective disease-modifying therapy approved.
TransCon CNP (navepegritide) is designed to optimize efficacy with a safe and convenient
once-weekly dose. It is designed to provide effective shielding of CNP from neutral
endopeptidase degradation in subcutaneous tissue and the blood compartment, minimize
binding of CNP to the NPR-C receptor to decrease clearance, reduce binding of CNP to the
NPR-B receptor in the cardiovascular system to avoid hypotension, and release unmodified
CNP , which is small enough in size to allow effective penetration into growth plates.
TransCon CNP (navepegritide) has completed the double-blind period of Phase 2 clinical
trial in China for the treatment of ACH with primary endpoint met according to the topline
results during the double-blind period. We became the sole sponsor for the OLE period of this
trial in January 2023 and the last patient last visit of the OLE period was completed in April
2024. The primary analysis of double-blind period for our ongoing China Phase 2 trial was
completed in November 2023. The topline results of the primary endpoint, AGV at 52 weeks,
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demonstrated a greater AGV of 5.939 cm/year for the cohort dosed at 100 µg/kg/week
compared to 4.760 cm/year for placebo. The topline results also suggest that TransCon CNP
(navepegritide) was generally well tolerated, without drug-related serious adverse events, and
adverse events leading to discontinuation of the drug in the subjects. The topline results from
China Phase 2 trial demonstrate consistency with the global Phase 2 trial in terms of primary
endpoint and safety profile.
Etiology of ACH and MoA of TransCon CNP (navepegritide)
ACH is caused by an autosomal dominant activating mutation in FGFR3 that leads to an
imbalance in the effects of the FGFR3 and CNP signaling pathways. The role of a defect in the
FGFR3 signaling pathway in the development of ACH is well understood. As depicted in the
figure below, FGFR3 negatively regulates chondrocyte proliferation and differentiation and
hence bone growth. ACH results from a mutation in FGFR3 which leaves the receptor
constitutively activated. CNP inhibits the FGFR3 pathway and thereby promotes proliferation
and differentiation of chondrocytes to restore bone growth.
FGFR Signaling Pathway
Heparin-binding
Ligand-binding
Extracellular
Intracellular
Kinase
Plasma Membrane
CNP signaling
blocks
FGFR3 effect
Source: Ascendis Pharma ©
Pre-clinical and clinical data show that the CNP pathway stimulates growth and increased
CNP helps to counteract the effects of the FGFR3 mutation downstream. Additionally, CNP
does not alter the function of fibroblast growth factor (“FGF”) receptors or change endogenous
levels of FGF ligands, reducing the risk of interfering with normal FGF biology. As ACH is
caused by an FGFR3 mutation that chronically inhibits growth, it is expected that a more
constant CNP exposure at lower C
max correlates with better therapeutic outcomes, with lower
cardiovascular risk.
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TransCon CNP (navepegritide) is designed to provide continuous CNP exposure at
therapeutic levels with a well-tolerated and convenient once-weekly dose, in order to
continuously inhibit abnormal FGFR3 signaling, restoring proliferation and differentiation of
chondrocytes to rebalance bone growth.
MoA of TransCon CNP (navepegritide)
TransCon
carrier
TransCon Linker Active CNP
Receptor
Renal
clearance
CNP
(inactive)
Linker cleavage
dependent upon pH
and temperature
Source: Ascendis Pharma ©
As depicted in the figure above, TransCon CNP (navepegritide) is an essentially inactive
prodrug consisting of CNP-38 transiently bound to a carrier molecule, 2 branched 20 kDa
methoxy polyethylene glycol (mPEG), via a transient conjugation linker linked to the epsilon
amino of lysine in position 26 of the CNP molecule. CNP-38 is identical to the unmodified
carboxy terminal amino acid residues 89 through 126 of human CNP . The carrier molecule,
mPEG, acts as a chemically inert carrier, extending CNP-38 circulation time in the body
through minimizing renal clearance of the TransCon CNP (navepegritide) prodrug, shielding of
the CNP molecule from proteolytic degradation and from binding to its primary activating and
clearance receptors, NPR-B receptor and NPR-C receptor, and largely inactivating CNP-38
until its release. TransCon CNP (navepegritide) releases active CNP-38 via auto-cleavage of
the transient conjugation linker in a controlled manner following first-order kinetics dependent
on pH and temperature. Following the cleavage of the transient conjugation linker under
physiologic pH and temperature, active CNP-38 peptide is slowly and continuously released
and, due to the small size of the peptide, assumed to be subjected to the same distribution and
pharmacodynamics mechanisms as endogenous CNP . As such, the transient conjugation
technology (TransCon) is designed to provide sustained exposure of active CNP-38, allowing
an optimal PK profile for use in children and adolescents with ACH, demonstrated by observed
apparent mean elimination half-life of 120h in adults (Phase 1 trial TCC-101) supporting
once-weekly dose administration. This is in contrast to the short systemic half-life of
endogenous CNP in humans of only 2 to 3 minutes (Hunt 1994), and the half-life of vosoritide
of approximately 45 minutes (BioMarin 2012). See “– Transient Conjugation Technology
(TransCon)” for more details regarding the transient conjugation technology (TransCon).
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Market Opportunity and Competitive Landscape
ACH is the most common form of dwarfism that results in severe skeletal complications
and comorbidities, including foramen magnum and spiral stenosis, sleep apnoea and chronic
ear infections. Patients often face multiple surgeries to alleviate the various complications
associated with ACH.
The prevalence of ACH in China was 51.2 thousand in 2023. ACH represents an untapped
market with immediate medical needs, given there is currently no effective disease-modifying
therapy for ACH approved in China. The chart below sets forth ACH therapy in clinical
development in China.
ACH Therapies with Clinical Activities in China, as of the Latest Practicable Date
Product Drug Structure Company Development Status
TransCon CNP
(navepegritide)
Prodrug of CNP VISEN (1) Phase 2
SAR442501 FGFR3 antibody Sanofi Phase 2
Note:
(1) VISEN has gained exclusive licensed rights to develop, manufacture and commercialize in China (including
Hong Kong, Macau and Taiwan); Ascendis Pharma retains the rights to develop, manufacture and
commercialize outside of China (including Hong Kong, Macau and Taiwan).
Source: CDE, Frost & Sullivan Analysis
See “Industry Overview – Achondroplasia – Competitive Landscape of the ACH Market
in China” for more details regarding the market of ACH.
Limitations of Current Treatment and Potential Advantages of TransCon CNP
(navepegritide)
Currently, there is no approved therapy available in China to treat the genetic basis of
ACH, with medical and surgical interventions limited to addressing some of the symptoms,
including spinal stenosis, hydrocephalus and obstructive sleep apnoea. Administration of CNP
to patients with ACH and in animal models of ACH has been found to stimulate growth.
V osoritide (V osoritide), as a CNP analogue, has been developed to provide better stability of
CNP and is approved by the FDA for the treatment of ACH in the United States. However,
V oxzogo (V osoritide) is a short-acting CNP-39 analogue with a half-life of 20 to 45 minutes
and daily injection is required. In addition to limited efficacy, short-acting CNP and CNP
analogues that result in high C
max levels may cause adverse cardiovascular events. As ACH is
caused by an FGFR3 mutation that chronically inhibits growth, we expect a more constant CNP
exposure at lower C
max to correlate with better therapeutic outcomes, with lower cardiovascular
risk. TransCon CNP (navepegritide) is an investigational long-acting prodrug of CNP designed
to provide continuous CNP exposure at therapeutic levels with a well-tolerated and convenient
once-weekly dose.
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Summary of Clinical Results
The following table sets forth an overview of the key clinical studies of TransCon CNP (navepegritide):
Trial
Sponsor/Subject/
Trial Status Primary Endpoint Secondary Endpoints Trial Key Summary
Phase 2 ACcomplisH China
Trial* (September 2021 –
present) (NCT05246033)
(52 weeks of double-blind
period followed by 52 weeks
of OLE period)
 Double-blind period by
Ascendis Pharma; OLE
period by the Company
 Children with ACH
 Ongoing
Safety: AEs, Clinical
laboratory investigations,
vital sign, ECG,
radiographic findings,
anti-drug antibodies
(ADA)
Efficacy: AGV at week 52
Efficacy: Change in body
proportionality (upper to lower
body segment ratio)
PK endpoints
A total of 24 male and female pre-pubertal children with ACH were included into
two dose-escalation cohorts, Cohort 1C (50 µg CNP/kg/week) and Cohort 1D (100
µg CNP/kg/week), each consisting of up to 12 children. The topline results of the
primary endpoint, AGV , at 52 weeks, demonstrated a greater AGV of 5.939
cm/year for the cohort dosed at 100 µg/kg/week compared to 4.760 cm/year for
placebo. The topline results also suggest that TransCon CNP (navepegritide) was
generally well tolerated, without drug-related serious adverse events, and adverse
events leading to discontinuation of the drug in the subjects.
Phase 3 Pivotal Trial (March
2023 – present)
(NCT05598320)
(52 weeks of double-blind
period followed by 52 weeks
of OLE period)
 Ascendis Pharma
 Children with ACH
 Ongoing
AHV at week 52 Height Z-score at week 52 The aim of the global Phase 3 pivotal trial is to evaluate efficacy and safety of
TransCon CNP (navepegritide) administered once weekly subcutaneous doses of
100 µg/kg compared to placebo on AHV after a 52-week randomized treatment
period in children aged 2 to 11 years with genetically confirmed ACH. A total of
84 prepubertal children with ACH were enrolled and randomized 2:1 to
once-weekly subcutaneous injection of TransCon CNP (navepegritide) or placebo
for 52 weeks. The trial met its primary endpoint, demonstrating TransCon CNP
(navepegritide) at 100 µg/kg/week was superior to placebo on the primary efficacy
endpoint of AGV with LS mean treatment difference of 1.49 cm/year at week 52
(AGV of 5.89 cm/year compared to 4.41 cm/year, p<0.0001) and was generally
well-tolerated.
Phase 2 ACcomplisH Trial
(June 2020 – present)
(NCT04085523)
(52 weeks of double-blind
period followed by 104
weeks of OLE period)
 Ascendis Pharma
 Children with ACH
 Ongoing (Primary
Completion in
September 2022)
To determine the safety of
once weekly
subcutaneous (SC) doses
of TransCon CNP
To evaluate the effect of
once weekly SC doses
of TransCon CNP on
AHV
Body proportionality (upper to
lower body segment ratio) in
prepubertal children with ACH
at 52 weeks
Pharmacokinetic (PK)
Immunogenic response
42 eligible participants with genetically confirmed achondroplasia were enrolled and
randomised 3:1 to once-weekly subcutaneous injections of TransCon CNP
(navepegritide) (6, 20, 50, or 100 µg CNP/kg/week) or placebo for 52 weeks.The
trial met its primary endpoint, demonstrating that TransCon CNP (navepegritide) at
100 µg/kg/week was superior to placebo on the primary efficacy endpoint of AHV
at 52 weeks and was generally tolerable, supporting continued development of
TransCon CNP (navepegritide) at the selected dose of 100 µg CNP/kg/week in the
ongoing pivotal trial. (Ravi Savarirayan, et al. Lancet 2023; 65:102258)
Note: * We in-licensed the TransCon CNP (navepegritide) from Ascendis Pharma in November 2018. Prior to our in-licensing, TransCon CNP (navepegritide) had been studied by Ascendis
Pharma in 45 healthy adult male subjects in a Phase 1 global trial. Phase 1 trial of performing initial safety or tolerability evaluation in healthy adu lts has been waived by the NMPA.
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ACHieve Study in China, a Nature History Capture Trial Conducted by VISEN
Pharmaceuticals and Sponsored by Ascendis Pharma
The ACHieve study, a longitudinal and observational global study sponsored by Ascendis
Pharma, initiated patient enrollment in November 2020 and concluded enrollment in March
2021, with 83 subjects enrolled across six sites. In November 2023, Ascendis Pharma informed
us that they have decided to begin the process for terminating this study by the end of 2023,
indicating that there have been fewer participants ongoing in the study as some of the patients
from this study have rolled over into studies of TransCon CNP (navepegritide) and others have
discontinued for other reasons. As part of this global study, we conducted the ACHieve study
in China to collect baseline data of the patients with ACH, serving as a source of valuable
information for the natural history of ACH. Additionally, we have rolled over 24 patients from
the ACHieve Study in China to the China Phase 2 trial facilitating a fast start for the trial.
Ongoing China Phase 2 trial, ACcomplisH China Trial, in Children (Aged 2–10 Years Old)
with ACH in China (including Hong Kong, Macau and Taiwan) Conducted by VISEN
Pharmaceuticals and Sponsored by Ascendis Pharma for Double-blind Period and Sponsored
by VISEN Pharmaceuticals for OLE Period
The ACcomplisH China Trial (TCC-204) is a multicenter Phase 2 clinical trial of weekly
TransCon CNP (navepegritide) administered subcutaneously in children with ACH. See “– Our
Drug Pipeline – TransCon CNP (navepegritide) – A Disease-Modifying Therapy for ACH –
Summary of Clinical Results” above. We had been the exclusive authorized agent for the China
Phase 2 trial, which was sponsored by Ascendis Pharma for the double-blind period, and we
became the sole sponsor for the OLE period of this trial as it commenced in January 2023 and
the last patient last visit of the OLE period was completed in April 2024. The primary
objectives of the China Phase 2 trial are to determine the safety of once weekly subcutaneous
doses of TransCon CNP (navepegritide) in children with ACH, and to evaluate the effect of
once weekly subcutaneous doses of TransCon CNP (navepegritide) on 12-month AGV in
children with ACH. We obtained IND approval from the NMPA on January 6, 2021 to initiate
the China Phase 2 trial in September 2021 and have finished patient enrollment.
Study Design. The China Phase 2 trial is designed to enroll participants aged two to ten
years old, the same age range as the global Phase 2 trial, and administer the same dose level
as in the global Phase 2 trial. A total of 24 male and female pre-pubertal children with ACH
will be included in the screening visit. The China Phase 2 trial comprises two dose-escalation
cohorts, Cohort 1C (50 µg CNP/kg/week) and Cohort 1D (100 µg CNP/kg/week), each
consisting of up to 12 children.
The China Phase 2 trial is double-blind and placebo-controlled. Patients in each cohort
will be randomized to receive either TransCon CNP (navepegritide) or placebo in a 3:1 ratio
and will follow the dose escalation plan outlined in the global Phase 2 trial. Each participant
received their assigned dose (or placebo) for 52 weeks, after which they continue participation
in the OLE period for approximately 52 weeks where all participants receive TransCon CNP
(navepegritide). In the OLE period, participants may receive the highest dose level of
TransCon CNP (navepegritide) that has been reviewed and recommended by the data
monitoring committee (“DMC”) of both the global Phase 2 trial and the China Phase 2 trial.
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When the China Phase 2 trial was initiated to enroll participants, Cohort 1 and Cohort 2
of the global Phase 2 trial had enough data for the DMC to review and make a recommendation
to initiate the next higher dose level at Cohort 3. These blinded data from the global Phase 2
trial informed the dose selection of 50 and 100 µg/kg/week for Cohort 1C and Cohort 1D of
the China Phase 2 trial. A summary of the study design of the China Phase 2 trial and its
relationship with the global Phase 2 trial is outlined in the figures below.
Study Design of China Phase 2 trial
Cohort 1: 6μg CNP/kg/week
Cohort 2: 20μg CNP/kg/week
Cohort 3: 50μg CNP/kg/week
Cohort 4: 100μg CNP/kg/week
Cohort 5: > 100μg CNP/kg/week*
Cohort 1C: 50μg CNP/kg/week
Cohort 1D: 100μg CNP/kg/week
After 3 months
Open-Label Period
OPTIONAL
After 3 months
After 3 months
After 6 months
After 6 months
After 3 months
Open-Label Period
* Cohort 5 is an optional cohort, and will only be initiated if data
from prior cohorts suggests that a higher dose is indicated
* Cohort 5 is an optional cohort, and will only be initiated if data from prior cohorts suggests that a higher dose
is indicated. Based on the data review from the global Phase 2 trial, there were no plans to pursue a dose higher
than 100 µg CNP/kg/week, as of the Latest Practicable Date.
Source: Ascendis Pharma /H23040; Company Information
The primary analysis of double-blind period for our ongoing China Phase 2 trial was
completed in November 2023. The topline results of the primary endpoint, AGV , at 52 weeks,
demonstrated a greater AGV of 5.939 cm/year for the cohort dosed at 100 µg/kg/week
compared to 4.760 cm/year for placebo. The topline results also suggest that TransCon CNP
(navepegritide) was generally well tolerated, without drug-related serious adverse events, and
adverse events leading to discontinuation of the drug in the subjects. The topline results from
China Phase 2 trial demonstrate consistency with the global Phase 2 trial, in terms of primary
endpoint and safety profile.
ApproaCH Registry Study, for ACH and Collaboration with CHARD
In addition to the China Phase 2 trial, we supported the founding of Achondroplasia
Advisory Board by providing funding under the governance of CHARD’s Advisory Board, in
June 2019 and subsequently entered a five-year strategic cooperation with CHARD on a
national patient registry and diagnosis consensus of ACH in China in December 2020 to initiate
the ApproaCH project, to which we were responsible for funding. As part of the ApproaCH
project, the first ACH Expert Consensus in China on Diagnosis and Treatment was published
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on Chinese Journal of Pediatrics in July 2021; a national patient registry study, ApproaCH
Registry Study, was initiated in April 2021 and achieved the first wave screening and
enrollment in October 2021 with a total of 14 centers finally established, to further understand
the natural history and current standard of care and economic burden in patients; additional
education programs will be done to improve the disease awareness and care in both healthcare
professionals and patients. As of December 2024, the ApproaCH Registry Study has reached
a total enrollment number of 480 patients and completed 214 first-year, 100 second-year and
59 third-year follow-ups. Upon its expected completion in 2025, the study will provide
valuable scientific data on the demographic and clinical characteristics of patients with ACH
in China.
Future Clinical Development Plan
In March 2023, all 24 patients have completed the double-blind treatment period and
continued to the OLE period. In April 2024, the last patient last visit of the OLE period was
completed. In accordance with the study protocol, we intend to use the data from the
double-blind period and the OLE period to support an NDA submission to the NMPA for
TransCon CNP (navepegritide) in children with ACH.
Licenses, Rights and Obligations
We hold exclusive rights to develop, manufacture and commercialize TransCon CNP
(navepegritide) in China (including Hong Kong, Macau and Taiwan) on a royalty-free basis.
See “– Collaborations – Exclusive License Agreements with Ascendis Pharma” for more details
regarding our exclusive license arrangements with Ascendis Pharma.
Our R&D Work
Our role changed from an exclusive agent to the sole sponsor since January 2023: for the
OLE period of the China Phase 2 trial beginning from January 2023, we became in charge of
the clinical development process in China. As the sole sponsor and under the applicable
research and technical development plans, we are now fully responsible for the following
aspects of the R&D activities for the development of TransCon CNP (navepegritide) in China:
(i) IND preparation, (ii) pre-IND communication and IND approval, (iii) trial preparation of
site selection, (iv) clinical trial personnel training, (v) medical monitoring and data
management, (vi) statistical management, and (vii) patient enrollment, and have exclusive
control over the supervision of clinical sites as well as the coordination of external vendors.
We have the research expertise or access to the research expertise required for the development
of TransCon CNP (navepegritide), including medical science, regulatory, clinical operation,
quality assurance, pharmacovigilance and data management, statistics and medical affairs.
We incurred R&D expenses of RMB17.8 million, RMB9.4 million and RMB15.2 million
on the development of TransCon CNP (navepegritide) in 2022, 2023 and the nine months ended
September 30, 2024, respectively. We anticipate that we will incur significantly more costs and
expenses in connection with our future R&D work as discussed below.
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During the Track Record Period, we procured R&D consulting services from Ascendis
Pharma with respect to pharmacovigilance and biometry for data analysis which, as advised by
Frost & Sullivan, is consistent with the industry practice. The amount of R&D consulting
services rendered by Ascendis Pharma relating to TransCon CNP (navepegritide) was RMB0.1
million, RMB3.0 million and RMB6.3 million in 2022, 2023 and the nine months ended
September 30, 2024, respectively.
IND Preparation
Since the in-licensing of TransCon CNP (navepegritide), our senior management has led
an internal R&D team and worked in close collaboration with Ascendis Pharma and our
scientific advisory board and industry-leading CROs to carry out R&D activities. Upon
receiving the relevant clinical data from Ascendis Pharma, our R&D team reviewed all the data
generated from the global Phase 2 trial of TransCon CNP (navepegritide) and prepared for
clinical trial initiations in China. Additionally, in October 2019, our R&D team organized a
scientific advisory board meeting with the KOLs to optimize the study designs for TransCon
CNP (navepegritide). The study designs have taken into consideration both (i) the scientific
rationale, such as the MoA, pre-clinical data, available global clinical data, and development
opportunity; and (ii) market opportunities in China, such as addressable patient population,
product positioning and competitive landscape of TransCon CNP (navepegritide). A data
monitoring committee was also established by Ascendis Pharma and supported by us to provide
recommendations on the action to be taken (i.e., continue the trial(s) (including planned dose
escalation) without modification; continue the trial(s) with modifications; or discontinue the
trial(s)) based on review of the unblinded data, including Erin Nissen Castelloe, MD, Bradley
S. Miller, MD, PhD, Eric T. Rush, MD, FAAP , FACMG and Huijuan Zhu, MD, who are
experienced KOLs and members from reputable medical institutions around the world.
Pre-IND Communication and IND Approval
We obtained IND approval from the NMPA on January 6, 2021 to initiate the China Phase
2 trial in September 2021, which demonstrates our advanced R&D capabilities.
Trial Preparation of Site Selection
We conducted a number of activities in connection with trial preparation and site
selection, including:
 Developing and approving trial-related documentation, including, without
limitation, the finalized protocol, informed consent form, case report form;
 Assessing potential challenges and risk for study conduct and other medical
considerations;
 Establishing operational strategies including recruitment strategy;
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 Evaluating site feasibility and preparing related submissions to the HGRAC; and
 Ensuring all study preparation including investigational drug and clinical supplies
was ready before the first patient was randomized.
Leveraging our insights and expertise in the pediatric endocrinology field, we managed
to obtain the HGRAC approval and complete site initiation in an efficient manner. On
November 17, 2020 and September 10, 2021, we completed the first site initiation for the
ACHieve Study in China and the China Phase 2 trial, respectively. Overall, we engaged a total
of six GCP certified investigational sites specialized in pediatric endocrinology for the
ACHieve Study and the China Phase 2 trial.
Clinical Trial Personnel Training
In order to complete a smooth and high-quality China Phase 2 trial, we designed a
systematic training program with respect to the equipment to be used for the trial, including:
 Equipment that measures the anthropometric parameters of patients for the
assessment of the primary and secondary endpoints for this trial;
 Electronic data capture (“EDC”) system that collects the clinical data in electronic
format;
 Interactive response technology (“IRT”) that automates patient randomization, kit
assignment, drug supply and inventory management;
 Central lab system that collects blood samples; and
 Central image system that measures bone age.
We also conducted training for anthropometrists to be certificated as well as for
investigators and sub-investigators at site initiation visit of each clinical site.
Medical Monitoring and Data Management
We developed a comprehensive medical monitoring and data management plan
encompassing the following:
 Monthly monitoring of medical data. Our medical and clinical development
department reviews the medical data with Ascendis Pharma once a month, analyzing
screening situation, inclusion and exclusion criteria, follow-up information and
safety information of the subjects in combination with the study protocol. The China
Phase 2 trial uses OmniComm system to collect the clinical trial data at the sites.
Data are entered into the eCRF from the source documents by designated
investigational site staff using single data entry with electronic verification. In
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general, queries are sent to the investigational site using an electronic data query
system which provided an automatic audit trail of the corrections made by
designated investigational site staff. Laboratory data will be uploaded in the central
lab’s own system and data will transfer regularly. After the data have been entered
and saved, various edit checks will be performed for the purpose of ensuring the
accuracy, integrity, and validity of the collected data. Under our standard, 100%
quality control (“QC”) check and 0% error rate are required for key safety and
efficacy (critical) variables. During the trial, we continuously monitor the quality of
data entry, including the progress report, data entry rate, source data verification
(“SDV”) rate, open query rate, missing page numbers, medical coding correctness,
external data transfer, safety data reconciliation with pharmacovigilance database.
 Real-time communication of AEs. Our clinical operation team communicates with
the CRO timely for AEs in clinical trials. Our clinical operation team and medical
team discuss the types of AEs and complete reports according to the operating
procedures timely and analyze the severity of AEs and their correlation to TransCon
CNP (navepegritide). For reported SAEs, CRO pharmacovigilance staff and medical
staff and our clinical operation team send the inquiry to the investigators. The
investigators then complete the follow-up report form with the follow-up
information of the subjects.
 Real-time communication of protocol deviation cases. Our medical and clinical
development department leads the adoption and modification of clinical trial plans
of TransCon CNP (navepegritide), manages the overall operation and reporting and
provides guidance for daily work and development. Our medical and clinical
development department also communicates with Ascendis Pharma timely to discuss
protocol deviation cases, analyzes the causes and solutions for each case, and
provides feedback to clinical supervisors and main researchers to avoid the
recurrence of such events.
Future R&D Work
We expect to engage in additional R&D work in connection with the ongoing China Phase
2 trial of TransCon CNP (navepegritide) for the treatment of ACH. In connection with such
additional R&D work, we expect to receive consulting services from Ascendis Pharma to
support our clinical data and statistics management.
Material Communications with the NMPA
On October 19, 2020, we filed an IND application to the NMPA to initiate the China
Phase 2 trial for TransCon CNP (navepegritide) for the treatment of pre-pubertal children with
ACH. On January 6, 2021, we obtained IND approval from the NMPA to initiate the China
Phase 2 trial for the treatment of ACH.
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As of the Latest Practicable Date, we have not received objections to our clinical
development plans with respect to the regulatory review or approval process of TransCon CNP
(navepegritide) in China.
WE MAY NOT BE ABLE TO ULTIMATELY DEVELOP AND MARKET TRANSCON CNP
(NAVEPEGRITIDE) IN CHINA (INCLUDING HONG KONG, MACAU AND TAIWAN)
SUCCESSFULLY.
Palopegteriparatide – A PTH Replacement Therapy Addressing the Underlying Cause of
HP
Overview
Palopegteriparatide is an investigational long-acting prodrug of PTH in development as
a novel once-daily PTH replacement therapy for HP . The current treatments for HP are
inadequate due to their limited therapeutic benefits and the need for chronic administration of
calcium in high doses and increased risks of associated complications. Palopegteriparatide is
designed to be the standard of care that can potentially address both the short-term symptoms
and long-term complications of HP by providing sustained release of serum PTH to restore the
physiological levels and activity of PTH throughout 24 hours per day. In accordance with
relevant procedures of World Health Organization, this drug candidate was assigned to the
recommended INN of “palopegteriparatide.”
In China, we are developing palopegteriparatide for the treatment of adult HP , following
our receipt of the IND approval from the NMPA in May 2021. We have completed the
double-blind period for the China Phase 3 pivotal trial in January 2023. Based on the topline
data from China Phase 3 pivotal trial, the primary endpoint, defined as the proportion of
subjects with albumin-adjusted serum calcium within the normal range, independence from
calcitriol or alfacalcidol active vitamin D, and independence from therapeutic doses of calcium
(i.e., taking calcium supplements /H11349600 mg/day) at 26 weeks of treatment, and no increase in
prescribed study drug within 4 weeks prior to Week 26 visit, was achieved by 77.6% (45 of 58)
of palopegteriparatide-treated patients, compared to 0.0% (0 of 22) of patients in control group
(p-value <0.0001). The topline data also suggest palopegteriparatide was generally well
tolerated, without drug-related serious adverse events and adverse events leading to
discontinuation of the drug in the subjects. The topline data from China Phase 3 pivotal trial
demonstrate consistency with the global Phase 3 pivotal trial, in terms of primary endpoint and
safety profile.
Etiology of HP and MoA of Palopegteriparatide
HP is a syndrome of abnormal calcium and phosphorus metabolism caused by
decreased secretion or defective function of PTH. It is characterized by hypocalcemia,
hyperphosphatemia and inappropriately low serum levels of PTH. HP may be due to congenital
or acquired disorders. The most common cause of HP is neck surgery, accounting for 75% of
the cases. Postsurgical HP occurs after thyroidectomy and parathyroidectomy due to injury of
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parathyroid glands and/or their blood supply. The causes of non-surgical HP , which comprise
the remaining 25% of the cases, include autoimmune diseases or genetic abnormalities,
invasive parathyroid disease, and external beam therapy and radioactive iodine treatment of
thyroid disease. Properly functioning parathyroid glands maintain proper levels of both
calcium and phosphorus by turning the secretion of PTH off or on. As depicted in the figure
below, PTH has direct and indirect effects on the bones (i.e., stimulates the release of calcium),
kidneys (i.e., increases serum calcium levels) and the small intestine (i.e., stimulates the
production of an enzyme that catalyzes the synthesis of active vitamin D which plays a role in
calcium absorption). When calcium levels in the blood fall too low, parathyroid glands secrete
enough PTH to restore the balance by releasing calcium from bones and increasing the amount
of calcium absorbed from the small intestine. There is a negative feedback loop when blood
calcium levels increase to attenuate secretion of PTH.
Regulation of Extracellular Calcium Homeostasis by
Properly Functioning Parathyroid Glands
Parathyroid gland
PTH
PTH1R Phosphate
excretion
25(OH)D
CYP27B1
Calcitriol
Ca2+
Bone resorption
Bone
CaSR
PTH1R
VDR
Ca2+
Osteoblast Osteoclast
Kidney
Intestine
Ca2+  absorptionCa2+  reabsorption
Source: Literature Review, Frost & Sullivan Analysis
Damaged or removed parathyroid glands, for example from thyroid or parathyroid
surgery, cannot produce adequate PTH or at all, which will lead to hypocalcemia by impairing
osteoclast activity, which diminishes the efflux of calcium from bone, by enhancing urinary
calcium excretion and by inhibiting the renal synthesis of calcitriol, which impairs the
intestinal absorption of dietary calcium. PTH deficiency also causes hyperphosphatemia,
owing to an increase in the renal tubular reabsorption of phosphate.
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Palopegteriparatide is designed to achieve and maintain a steady concentration of PTH in
the blood at levels similar to those observed in healthy individuals. Leveraging the ability of
the transient conjugation technology (TransCon) to generate long-acting prodrugs of
unmodified parent drugs, palopegteriparatide is designed to restore physiologic levels and
activity of PTH throughout 24 hours per day, thereby fundamentally addressing the underlying
cause of the symptoms.
MoA of Palopegteriparatide
Source: Ascendis Pharma /H23040
As depicted in the figure above, palopegteriparatide consists of a parent drug, PTH
(1-34), transiently bound to an inert carrier (40 kDa mPEG) via a proprietary linker. The carrier
inactivates the parent drug and shields it from receptor uptake, renal clearance, and enzymatic
degradation. Following a single subcutaneous injection and upon exposure to physiologic pH
and temperature, autocleavage of the linker occurs, thus releasing active PTH in a controlled
manner and leading to PTH exposure over several days. See “– Transient Conjugation
Technology (TransCon)” for more details regarding the transient conjugation technology
(TransCon).
Market Opportunity and Competitive Landscape
The prevalence of HP in China was 410.1 thousand in 2023, representing a significant
market. No PTH replacement therapy has been approved for HP treatment in China
and palopegteriparatide is the only PTH replacement therapy that has initiated
clinical development in China. The following charts set forth the PTH replacement therapy that
is in clinical development in China.
PTH Replacement Therapy with Clinical Activities in China,
as of the Latest Practicable Date
Investigational Drug Drug Structure Company Clinical Status
Palopegteriparatide Prodrug of PTH VISEN (1) Phase 3
Note:
(1) VISEN has gained exclusive licensed rights to develop, manufacture and commercialize in China (including
Hong Kong, Macau and Taiwan); Ascendis Pharma retains the rights to develop, manufacture and
commercialize outside of China (including Hong Kong, Macau and Taiwan).
Source: CDE, Frost & Sullivan Analysis
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See “Industry Overview – Hypoparathyroidism – Competitive Landscape of the HP
Market in China” for more details regarding the market of HP .
Limitations of Currently Available Treatment Options and Potential Advantages of
Palopegteriparatide
Treatment of HP is aimed at correcting hypocalcemia and hyperphosphatemia, reducing
symptoms, and preventing chronic complications resulting from the disease or its treatment.
Due to the limitations of currently available treatment options, the generally accepted target
serum calcium concentration for HP patients is in the lower end of the normal range, a state
in which symptoms of hypocalcemia are generally uncommon. Current treatments globally
generally fall into two categories: conventional therapy and PTH therapy.
 Conventional therapy . Conventional therapy consists of calcium in combination
with active vitamin D and sometimes other supplements. While conventional
therapy can increase serum calcium level, it is hard to restore the serum calcium
level to a narrow range within the lower end of the normal range. Additionally,
conventional therapy often requires the use of very high doses of calcium and active
vitamin D, which cause serum calcium fluctuation, high urine calcium and high
serum phosphate, potentially putting HP patients at risk for many complications
such as impaired renal function and extraskeletal calcifications. Some individuals
remain symptomatic or fail to meet treatment goals even after conventional therapy,
with some requiring multiple hospitalizations for hypocalcemia or HP
complications.
 PTH therapy . PTH therapy, as a feasible alternative to conventional treatment, has
been shown to maintain normocalcemia without the need (or with reduced need) for
concurrent treatment with the therapeutic dosage of calcium and active vitamin D
analogs. To date, once-daily Natpara (PTH (1-84)) is the first PTH therapy that has
been approved in the United States and the European Union, although merely
indicated as an adjunct to calcium and vitamin D to control hypocalcemia in patients
with HP . Natpara (PTH (1-84)) received the marking approval from the FDA in 2015
and a conditional marketing authorization from the EMA in 2017, respectively, but
was later recalled from the United States market. Because Natpara (PTH (1-84)) was
approved as an adjunct to calcium and vitamin D, it does not eliminate the inherent
risks associated with conventional therapy. In addition, PTH (1-84) has not been
able to show meaningful benefits on clinical episodes of hypocalcemia or
hypercalcemia or effect on 24-hour urine calcium excretion.
According to Frost & Sullivan, Natpara (PTH (1-84)) is the first available PTH therapy,
but is unable to achieve the physiological level and activities of PTH due to its short half-life,
and therefore does not have an ideal PK. Natpara (PTH (1-84)) has not demonstrated the ability
to reduce incidences of hypercalcemia (elevated serum calcium levels), hypocalcemia (low
serum calcium) or hypercalciuria (elevated urinary calcium) relative to conventional therapy in
treated patients. Unlike PTH (1-84), palopegteriparatide is designed as a once-daily PTH
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therapy with a long half-life to address the fundamental cause of HP by restoring physiological
and stable levels of PTH 24 hours throughout the day. PK data from MAD cohorts in Ascendis
Pharma’s Phase 1 clinical trial of palopegteriparatide in healthy subjects demonstrated a
half-life of approximately 60 hours, supporting an infusion-like profile of free PTH. This
substantial half-life extension of PTH would reflect more closely the physiological levels of
PTH observed in healthy individuals, maintain normal blood calcium levels, normalize urinary
calcium excretion, reduce clinical hypercalcemia, reduce clinical hypocalcemia, normalize
serum phosphate and normalize bone turnover. This infusion-like PK profile of
palopegteriparatide translates into a predictable serum calcium response, suggesting the ability
to titrate patients with HP into the normal calcemic range. By providing steady levels of PTH
in the physiological range, palopegteriparatide has the potential to address the fundamental
limitations of short-acting PTH molecules, such as PTH (1-84) and PTH (1-34) and become a
highly differentiated therapy for HP .
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Summary of Clinical Results
The following table sets forth an overview of the key clinical studies of palopegteriparatide:
Trial
Sponsor/Subject/
Trial Status Primary Endpoint Secondary Endpoints Trial Key Summary
Phase 3 PaTHway
China Trial* (June
2022 – present)
(NCT05387070)
(26 weeks of double-
blind period followed
by 3 years of long-
term extension
period)
 The Company
 Adults with HP
 Ongoing (Primary
Completion in January
2023)
Multi-component endpoint was defined as the proportion of
participants who met the following criteria at Week 26 of blinded
treatment:
 Albumin-adjusted serum calcium measured within 4 weeks
prior to and at the Week 26 visit within the normal range and
 Independence from active vitamin D (calcitriol and
alfacalcidol) within 4 weeks prior to the Week 26 visit and
 Independence from therapeutic doses of calcium within 4
weeks prior to the Week 26 visit and
No increase in prescribed study drug within 4 weeks prior to the
Week 26 visit
Safety and tolerability, HPES,
PD markers (serum calcium)
and active vitamin D and
calcium doses, treatment
effect during Extension
Period, BMD, bone turnover
markers (serum P1NP and
CTx), patient-reported
health-related QoL and a
clinician-reported outcome
(ClinRO) assessment
81 subjects enrolled and 80 subjects dosed in the trial. The primary endpoint, defined as
the proportion of subjects with albumin-adjusted serum calcium within the normal
range, independence from calcitriol or alfacalcidol active vitamin D, and independence
from therapeutic doses of calcium at 26 weeks of treatment, and no increase in
prescribed study drug within 4 weeks prior to Week 26 visit, was achieved by 77.6%
(45 of 58) of palopegteriparatide-treated patients, compared to 0.0% (0 of 22) of
patients in control group (p-value <0.0001). The topline data also suggest
palopegteriparatide was generally well tolerated, without drug-related serious adverse
events, and adverse events leading to discontinuation of the drug in the subjects. The
topline data from China Phase 3 pivotal trial demonstrate consistency with the global
Phase 3 pivotal trial, in terms of primary endpoint and safety profile.
Phase 3 PaTHway Trial
(February 2021 –
present)
(NCT04701203)
(26 weeks of double-
blind period followed
by 3 years of long-
term extension study)
 Ascendis Pharma
 Adults with HP
 Ongoing (Primary
Completion in January
2022)
Multi-component endpoint was defined as the proportion of
participants who met the following criteria at Week 26 of blinded
treatment:
 Albumin-adjusted serum calcium measured within 4 weeks
prior to and at the Week 26 visit within the normal range and
 Independence from active vitamin D (calcitriol and
alfacalcidol) within 4 weeks prior to the Week 26 visit and
 Independence from therapeutic doses of calcium within 4
weeks prior to the Week 26 visit and
 No increase in prescribed study drug within 4 weeks prior to
the Week 26 visit
Safety and tolerability, HPES,
PD markers (serum calcium)
and active vitamin D and
calcium doses, Anti-drug
antibodies (ADA), treatment
effect during Extension
Period, BMD, bone turnover
markers (serum P1NP and
CTx), patient-reported
health-related QoL and a
clinician-reported outcome
(ClinRO) assessment
82 adults with chronic HP were enrolled and dosed in the trial. The trial met primary and
all key secondary endpoints: 78.7% of patients treated with palopegteriparatide achieved
the primary endpoint, defined as serum calcium levels in the normal range (8.3-10.6
mg/dL) and independence from conventional therapy (active vitamin D and >600
mg/day of calcium supplements) with no increase in prescribed study drug within the 4
weeks prior to the 26 weeks visit, compared to 4.8% of patients in the control group
(p-value <0.0001), and statistically significant improvements were observed on all key
prespecified secondary endpoints (i.e., HPES and SF-36) compared to the control group.
In addition, topline results at 52 weeks (OLE period) of the global Phase 3 pivotal trial
showed that treatment with palopegteriparatide resulted in sustained improvements
through week 52, as well as safety and tolerability similar to that of the initial 26-week
double-blind period of the trial. (Aliya A Khan, et al. J Bone Miner Res.2023;38 (1):
14–25)
Phase 2 PaTH Forward
Trial (August 2019–
present)
(NCT04009291)
(4 weeks of double-
blind period followed
by up to 210 weeks
of long-term
extension study)
 Ascendis Pharma
 Adults with HP
 Ongoing (Primary
Completion in March
2020)
To assess the effectiveness of daily TransCon PTH on serum and
urine calcium levels (FECa) and active vitamin D and calcium
doses at 4 weeks of treatment
Safety and tolerability, HPES,
serum and urine calcium
levels (FECa), daily pill
burden (vitamin D and
calcium), serum phosphate,
serum magnesium, and
calcium x phosphate product
(sCa x sP product)
59 individuals with hypoparathyroidism were enrolled and treated with TransCon PTH 15,
18, or 21 µg PTH(1-34)/day or placebo for 4 weeks, followed by a 22-week extension
during which TransCon PTH dose was titrated (6-60 µg PTH[1-34]/day). Preliminary
data at 26, 58, 84 and 110 weeks from the OLE period of the PaTH Forward Trial
supported palopegteriparatide as a potential hormone replacement therapy for adults
with HP . (Aliya A Khan, et al. J Clin Endocrinol Metab. 2022; 107(1): e372–e385)
Note: * We in-licensed the palopegteriparatide from Ascendis Pharma in November 2018. Prior to our in-licensing, palopegteriparatide had been studied by A scendis Pharma in healthy adult
volunteers in a Phase 1 trial. Phase 1 trial of performing initial safety or tolerability evaluation in healthy adults and Phase 2 trial of proof-of-co ncept studies in China have been waived
by the NMPA.
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VISEN Pharmaceuticals’ Ongoing China Phase 3 pivotal trial, PaTHway China Trial, in HP
We are developing palopegteriparatide in China in adult HP in a China Phase 3 pivotal
trial. The aim of this trial is to assess the efficacy, safety and tolerability of palopegteriparatide
in adults with HP to support an NDA filing to the NMPA for palopegteriparatide in adult HP .
We screened the first patient in China in November 2021 and completed patient enrollment in
June 2022. We completed the double-blind period in January 2023 while the long-term OLE
portion of this trial is ongoing as of the Latest Practicable Date.
Study Design . The China Phase 3 pivotal trial, is a multi-center, randomized, double-
blind, placebo-controlled trial that was designed to enroll 76 adults with HP . The main
inclusion criteria include: (i) males and females aged 18 years old or above; (ii) subjects with
postsurgical chronic HP , or auto-immune, genetic, or idiopathic HP for at least 26 weeks; and
(iii) doses of conventional therapy (e.g., calcitriol, alfacalcidol, calcium supplements) be at or
above a minimum threshold (calcitriol /H113500.5 µg/day, or alfacalcidol /H113501.0 µg/day and
(elemental) calcium /H11350800 mg/day for at least 12 weeks prior to screening.). The main
exclusion criteria include: (i) impaired responsiveness to PTH, which is characterized as
PTH-resistance, with elevated PTH levels in the setting of hypocalcemia; (ii) any disease that
might affect calcium metabolism or calcium-phosphate homeostasis or PTH levels other than
HP , such as active hyperthyroidism; and (iii) high risk thyroid cancer within two years.
During the first 26 weeks of the trial, subjects will be randomized in a 3:1 ratio into one
of the two treatment groups – once-daily injections of palopegteriparatide at 18 µg/day or
placebo for palopegteriparatide (excipient solution), co-administered with conventional
therapy. Randomization will be stratified by etiology of HP (postsurgical vs. other). All
subjects will start with the study drug (18 µg/day) and will be individually and progressively
titrated to an optimal dose in dose increments of 3 µg/day. Palopegteriparatide or placebo will
be administered as a subcutaneous injection using a pre-filled injection pen. Neither trial
participants nor their doctors will know who has been assigned to each group. After the 26
weeks, participants will continue in the trial as part of a long-term OLE study of up to 156
weeks. During the 3-year extension, all participants will receive palopegteriparatide, with the
dose adjusted to their individual needs in order to enhance local long-term data for future
scientific communication.
The primary endpoint for this trial are the proportion of subjects with albumin-adjusted
serum calcium within the normal range, independence from calcitriol or alfacalcidol active
vitamin D, and independence from therapeutic doses of calcium (i.e., taking calcium
supplements /H11349600 mg/day) at 26 weeks of treatment. The key secondary endpoints for this trial
are change from baseline in HP patient experience scale (“HPES”) and change from baseline
in 36-Item Short Form Survey (“SF-36”) at 26 weeks of treatment. HPES is a well-developed,
disease-specific, PRO measure to assess the symptoms and impacts associated with HP in
adults.
4 The HPES-symptom assesses the key HP-related physical and cognitive symptoms
4 https://jpro.springeropen.com/articles/10.1186/s41687-021-00320-2
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from the patient perspective. The HPES-impact assesses the key impacts of these symptoms on
patient functioning and well-being, including physical functioning, daily life, psychological
well-being and social life and relationships. SF-36 is a multipurpose short-form health survey
with 36 questions that yields an eight-scale profile of functional health and general well-being,
as well as two psychometrically-based physical and mental health summary measures and a
preference-based health utility index. It is viewed as a practical, reliable and valid measure of
physical and mental health. The primary and key secondary efficacy endpoints will be
measured at predefined timepoints during the period of the long-term OLE study.
Convenient Prefilled Pen. A single-patient-used prefilled pen will be included in this
ongoing trial for administration of palopegteriparatide and placebo according to the study
protocol. With this convenient prefilled pen, subjects can inject study drug on their own after
receiving brief training. According to the study protocol for this Phase 3 pivotal trial, the China
Phase 3 pivotal trial, palopegteriparatide is supplied as a solution with a concentration of 0.3
mg PTH (1-34)/mL in a single-patient-use prefilled pen intended for subcutaneous injection.
Excipients include metacresol, mannitol, succinic acid, and NaOH/(HCl). The prefilled pens
are stored in the refrigerator until first use; the palopegteriparatide drug product is stable at
room temperature below 86°F (30°C) for the 14 days in-use period when dosing with the
pre-filled pen. Three presentations of the prefilled pen containing palopegteriparatide drug
product are available, which are 6, 9, and 12 µg/day; 15, 18, and 21 µg/day; and 24, 27 and 30
µg/day, respectively. The placebo for palopegteriparatide drug product (excipient solution in
the pens) are in three pen presentations to mimic dose ranges of 6, 9, and 12 µg/day; 15, 18,
and 21 µg/day; and 24, 27 and 30 µg/day, respectively, within the Blind Treatment Period. We
intend to include this pen device as part of our NDA filing to the NMPA, making the convenient
prefilled pen available to patients using our marketed drug.
Based on the topline data from China Phase 3 pivotal trial, the primary endpoint, defined
as the proportion of subjects with albumin-adjusted serum calcium within the normal range,
independence from calcitriol or alfacalcidol active vitamin D, and independence from
therapeutic doses of calcium (i.e., taking calcium supplements /H11349600 mg/day) at 26 weeks of
treatment, and no increase in prescribed study drug within 4 weeks prior to Week 26 visit, was
achieved by 77.6% (45 of 58) of palopegteriparatide-treated patients, compared to 0.0% (0 of
22) of patients in control group (p-value <0.0001). 89.7% of palopegteriparatide-treated
patients achieved independence from conventional therapy, and palopegteriparatide treatment
demonstrated a statistically significant improvement compared to control group at Week 26 in
HPES Symptoms Physical Domain scores (P=0.022). The mean observed 24-hour urine
calcium values had normalized in the palopegteriparatide-treated patients (164.9 mg/day) but
not in the control group (253.2 mg/day). Additionally, with palopegteriparatide treatment, bone
turnover markers increased above baseline suppressed levels. As expected in HP , bone density
was at the upper end of normal at baseline and trended down toward mid-normal with
palopegteriparatide therapy. The topline data also suggest palopegteriparatide was generally
well tolerated, without drug-related serious adverse events and adverse events leading to
discontinuation of the drug in the subjects. The topline data from China Phase 3 pivotal trial
demonstrate consistency with the global Phase 3 pivotal trial, in terms of primary endpoint and
safety profile.
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PaTHway R Study for HP
In addition to the China Phase 3 pivotal trial, we entered into a strategic cooperation
agreement with Peking University Health Science Center to initiate the PaTHway R study in
July 2021, in order to enhance the understanding of the real-world clinical practice of disease
management in China for HP . PaTHway R is the first registry study for HP in China and one
of the largest epidemiological surveys for this disease worldwide and was kicked off in January
2022. This study is expected to recruit at least 500 patients in eight top hospitals as
investigational sites with a goal to provide evidence of diagnosis, treatment, economic burden,
and quality of life of the patients with HP . As of December 23, 2022, this study had completed
the patient enrollment of a total of 526 subjects. We expect that the data from this study could
help the scientific society yield a whitepaper and update the Treatment Guideline for HP , as
well as to generate data to support the reimbursement negotiation of palopegteriparatide into
NRDL.
Future Clinical Development Plan
We successfully obtained IND approval from the NMPA in May 2021 and initiated a
China Phase 3 pivotal trial, in China for the treatment of adult HP by screening the first patient
in November 2021. In accordance with the study protocol, we intend to use the data from the
double-blind period to support an NDA submission to the NMPA for palopegteriparatide in
adult HP , while we continue to conduct the OLE portion of this trial.
Licenses, Rights and Obligations
We hold exclusive rights to develop, manufacture and commercialize palopegteriparatide
in China (including Hong Kong, Macau and Taiwan) on a royalty-free basis. See “–
Collaborations – Exclusive License Agreements with Ascendis Pharma” for more details
regarding our exclusive license arrangements with Ascendis Pharma.
Our R&D Work
We have been the sole sponsor of China clinical study and remain in charge of the clinical
development process in China since in-licensing of palopegteriparatide. As further disclosed
below, we are fully responsible for the following aspects of the R&D activities for the
development of palopegteriparatide in China: (i) IND preparation, (ii) pre-IND communication
and IND approval, (iii) trial preparation of site selection, (iv) clinical trial personnel training,
(v) medical monitoring and data management, (vi) statistical management, and (vii) patient
enrollment, and have exclusive control over the supervision of clinical sites as well as the
coordination of external vendors. We have the research expertise or access to the research
expertise required for the development of palopegteriparatide, including medical science,
regulatory, clinical operation, quality assurance, pharmacovigilance and data management,
statistics and medical affairs.
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We incurred R&D expenses of RMB55.5 million, RMB19.6 million and RMB19.3 million
on the development of palopegteriparatide in 2022, 2023 and the nine months ended September
30, 2024, respectively. We anticipate that we will incur significantly more costs and expenses
in connection with our future R&D work as discussed below.
During the Track Record Period, we procured R&D consulting services from Ascendis
Pharma with respect to pharmacovigilance and biometry for data analysis, for example,
statistical programming and statistical analysis which, as advised by Frost & Sullivan, is
consistent with the industry practice. The amount of R&D consulting services rendered by
Ascendis Pharma relating to palopegteriparatide was RMB0.9 million, RMB0.7 million and
RMB0.1 million in 2022, 2023 and the nine months ended September 30, 2024, respectively.
IND Preparation
Since the in-licensing of palopegteriparatide, our senior management has led an internal
R&D team and worked in close collaboration with our scientific advisory board and
industry-leading CROs to carry out R&D activities. Upon receiving the relevant clinical data
from Ascendis Pharma, our R&D team reviewed all the data generated from the global trials
of palopegteriparatide and prepared for clinical trial initiations in China. Taking into
consideration the specific disease epidemiology, disease characteristics, local clinical practice
as well as the status of the PTH market in China, we prepared the clinical study protocol of
palopegteriparatide in China to verify the efficacy and safety of palopegteriparatide in Chinese
population in order to support the future clinical development and regulatory filings for
palopegteriparatide in China.
Additionally, in December 2020 our R&D team organized a meeting with the KOLs on
the scientific advisory board to optimize the study designs for palopegteriparatide’s China
alone trial. The study designs have taken into consideration both (i) the scientific rationale,
such as MoA, well established pre-clinical data and the most updated global clinical data, the
global study protocol, as well as local clinical practice; and (ii) market opportunities in China,
such as addressable patient population, product positioning and competitive landscape of
palopegteriparatide.
Pre-IND Communication and IND Approval
During pre-IND communication, waiver of Phase 1 and 2 trial and immunogenic assay
have been accepted by CDE. In the current China Phase 3 pivotal trial, quality of life
questionnaires has been used for patient life quality evaluation. In China, we received the IND
approval from the NMPA in May 2021 to develop palopegteriparatide for the treatment of adult
HP .
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Trial Preparation of Site Selection
We conducted a number of activities in connection with trial preparation and site
selection, including:
 Developing and approving trial-related documentation, including, without
limitation, the finalized protocol, informed consent form, case report form;
 Assessing potential challenges and risks for study conduct and other medical
considerations;
 Establishing operational strategies including recruitment strategy;
 Evaluating site feasibility and preparing related submission to the HGRAC; and
 Ensuring all study preparation including investigational drug and clinical supplies
was ready before the first patient was randomized.
Leveraging our insights and expertise in the endocrinology field, we managed to obtain
the HGRAC approval and complete site initiation in an efficient manner. We completed the first
site initiation on October 15, 2021. The last site has been completed on March 24, 2022.
Overall, we engaged a total of 14 GCP certified investigational sites specialized in
endocrinology across China for this Phase 3 pivotal trial.
Clinical Trial Personnel Training
In order to complete a smooth and high-quality Phase 3 pivotal trial, we designed a
systematic training program with respect to the equipment to be used for the trial, including:
 Central image system dual X-ray absorptiometry (“DXA”) that measures the bone
mineral density (“BMD”) and trabecular bone score (“TBS”) for the assessment of
the secondary efficacy endpoints for this trial;
 Electronic data capture (“EDC”) system that collects the clinical data in electronic
format;
 Interactive response technology (“IRT”) that automates patient randomization, kit
assignment, drug supply; and
 Central lab system that collects blood samples.
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Medical Monitoring and Data Management
We developed a comprehensive medical monitoring and data management plan
encompassing the following:
 Monthly monitoring of medical data . During the trial, we continuously monitor the
quality of data entry, including the progress report, data entry rate, source data
verification (“SDV”) rate, open query rate, missing page numbers, medical coding
correctness, external data transfer and safety data reconciliation with
pharmacovigilance database.
 Real-time communication of AEs . For reported SAEs, pharmacovigilance staff and
medical staff and our clinical operation team send the inquiry to the investigators.
The investigators then complete the follow-up report form with the follow-up
information of the subjects.
 Real-time communication of protocol deviation cases . Our medical and clinical
operation team discusses protocol deviation cases, analyzes the causes and solutions
for each case, and provides feedback to clinical supervisors and main researchers to
avoid the recurrence of such events.
Future R&D Work
We expect to engage in additional R&D work in connection with the ongoing China Phase
3 pivotal trial and the preparation of regulatory filings of palopegteriparatide in China. In
connection with our expected NDA with the NMPA for palopegteriparatide, we expect to
receive consulting services from Ascendis Pharma to support our biostatistical activities
including data programming and statistical analysis, which is consistent with the industry
practice.
Material Communications with the NMPA
On March 22, 2021, the NMPA accepted our IND application to the NMPA to initiate the
China Phase 3 pivotal trial of palopegteriparatide, in China for the treatment of HP .
On May 31, 2021, we obtained IND approval to initiate this Phase 3 pivotal trial.
As of the Latest Practicable Date, we have not received objections to our clinical
development plans with respect to the regulatory review or approval process of
palopegteriparatide in China.
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WE MAY NOT BE ABLE TO ULTIMATELY DEVELOP AND MARKET
PALOPEGTERIPARATIDE IN CHINA (INCLUDING HONG KONG, MACAU AND
TAIWAN) SUCCESSFULLY.
TRANSIENT CONJUGATION TECHNOLOGY (TRANSCON)
Our drug pipeline is generated based on transient conjugation technology (TransCon)
developed by Ascendis Pharma. Transient conjugation molecules have three components: an
existing parent drug, an inert carrier that protects it, and a linker that temporarily binds the two.
When bound, the carrier inactivates and shields the parent drug from clearance. After
distribution into the body, transient conjugation enables unmodified parent drug to be released
in a predictable manner and maintain physiologic activity. Overall, transient conjugation
technology (TransCon) is designed to combine known biology with the benefits of prodrug and
sustained-release technologies to potentially optimize therapeutic effect, which could mean
enhancing efficacy, improving tolerability and convenience, or reducing caregiver burden.
Transient conjugation linkers. Transient conjugation linkers are reversible linkers that
enable the transient conjugation of a broad range of therapies, including proteins, peptides and
small molecules, to transient conjugation carriers. Transient conjugation linkers can be applied
to various types of parent drugs and be tailored to achieve half-life extension enabling daily,
weekly, monthly and half-yearly dosing, and customize the PK profile for each individual drug
candidate to potentially optimize the therapeutic effect. Transient conjugation linkers are
self-cleaving through an intra-molecular assisted cleavage process causing the linker to release
the unmodified parent drug at predetermined rates governed by physiological pH and
temperature conditions, which are tightly regulated in the body. Consequently, transient
conjugation platform-enabled prodrugs can be designed to release the unmodified parent drug
at predictable rates.
Transient conjugation carriers. Transient conjugation carriers are self-eliminating
hydrogels that inactivate and protect the drug through a shielding effect, which prevents rapid
excretion and degradation of the parent drug and may enable benefits that include improved
injection site tolerability, reduced systemic adverse effects and low immunogenicity. Our drug
candidates, lonapegsomatropin, TransCon CNP (navepegritide) and palopegteriparatide, are
built on systemic carriers and are readily absorbed into the bloodstream after administration,
thus minimizing exposure of the subcutaneous tissue to active drug, which has the potential to
improve injection site tolerability.
Parent drug. The transient conjugation technology (TransCon) is applicable across a
broad range of therapeutic classes and are currently used to create long-acting product
candidates based on proteins, peptides and small molecules. Because the parent drug is
unmodified, its original mode of action is expected to be maintained, which could lead to a
potentially higher development and regulatory success rate for our drug candidates as
compared to the development of drug compounds without established biology.
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The transient conjugation technology (TransCon) is designed to combine known biology
with the benefits of conventional prodrug and sustained release technologies to solve the
fundamental limitations seen in other approaches to extending duration of a drug’s action in the
body. The FDA and EMA approvals of lonapegsomatropin for PGHD represents the first
marketing approvals obtained by a drug generated from the transient conjugation technology
(TransCon) and an important milestone that demonstrates the effectiveness and vast potential
of the transient conjugation technology (TransCon).
RESEARCH AND DEVELOPMENT
We are dedicated to building a pipeline of endocrine therapies in China (including Hong
Kong, Macau and Taiwan). We believe successful clinical development execution is critical to
our future growth and our ability to remain competitive in the biopharmaceutical market in
China.
R&D Team and Capabilities
We have a strong China-based in-house clinical R&D team led by a seasoned management
team with strong therapeutic area expertise and experience in global biopharmaceutical
development, medical practice and strategic planning. We have assembled senior R&D
personnel with extensive expertise in clinical development, regulatory affairs, medical affairs,
and CMC, headed by Dr. W ANG Y an, Ms. Tina CHEN, Mr. GU Qing and Dr. ZHU Jing,
respectively. Our R&D team is led by the foregoing four department heads collectively. Our
R&D capabilities are also supported by our scientific advisory board comprising reputable
KOLs in endocrinology and pediatrics.
Below sets forth information about our R&D team heads that play key roles in leading the
development of our each drug candidate and local manufacture project as of the Latest
Practicable Date:
 Head of Clinical Development, Dr . WANG Yan. Dr. Wang has over 19 years of drug
development experience in global pharmaceutical industry (Ipsen, Pfizer, Servier)
and local innovative biotech company (Huahui Health, Beijing HAFO Biomedical
Research & Development Co., Ltd.), covering therapeutic areas including
endocrinology and metabolism, pediatric, rare disease, oncology, cardiovascular
disease, psychology, neurology and hepatology. Dr. Wang has three years of medical
practitioner experience in pneumology and gastroenterology and six years of
research experience in hepatology and hepatitis during post-graduate period. Dr.
Wang obtained her bachelor’s degree in clinical medicine from Beijing Medical
University (ɽኪ) (currently known as Peking University Health Science
Center ( ̏ԯɽኪᔼኪ௅)) in the PRC in July 1995. Dr. Wang further obtained her
master’s in internal medicine and doctoral degree in infectious disease from Peking
University ( ̏ԯɽኪ) in the PRC in June 2001 and June 2004, respectively.
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 Head of Regulatory Affairs, Ms. Tina CHEN. Ms. Chen has nearly 16 years of
experience in handling new drug registration for both local and imported products,
registration strategy and leading and managing regulatory affairs team. She served
as a department head at Winhealth Pharma before joining the Company. Before that,
she also held various regulatory affairs positions at Kyowa Kirin China, Inc.,
AstraZeneca Pharmaceutical Technologies (Beijing) Co., Ltd., GlaxoSmithKline
(China) Investment Co., Ltd., Astellas Pharma China, Inc. and Santen
Pharmaceutical (China) Co., Ltd., respectively. Ms. Chen obtained her bachelor’s
degree in pharmacy (Japanese) and her master’s in pharmaceutics from Shenyang
Pharmaceutical University (ɽኪ) in the PRC in 2005 and 2008,
respectively. She also attended the Chinese Course on Drug Development and
Regulatory Sciences (CCDRS) (೯ձ၍ଣ৷ॴሙ೻) in Peking
University Health Science Center ( ̏ԯɽኪᔼኪ௅) in the PRC from March to
November 2012.
 Head of Medical Affairs, Mr . GU Qing. Mr. Gu has over 22 years of experience in
global pharmaceutical industry (Xian Janssen Pharmaceutical, GlaxoSmithKline,
Novo Nordisk, AstraZeneca and Lilly China) as product manager, marketing
manager and director, brand director, and has four years of experience as medical
practitioner. Mr. Gu obtained his bachelor’s degree in prevention medicine from
Nanjing Railway Medical College (ԯ᚛༸ᔼኪ৫) (later merged into Southeast
University (ɽኪ)) in the PRC in July 1995.
 Head of CMC, Dr . ZHU Jing. Dr. Zhu has about 14 years of research and working
experience in biologics CMC process development and manufacturing, with focus
on CMC technical management and biologics drug product development and
manufacturing. Dr. Zhu worked at I-Mab Biopharma and WuXi Biologics prior to
joining us. Dr. Zhu obtained her master’s in pharmaceutics from Tianjin University
in July 2009 and her doctoral degree in pharmacy from University of Nottingham in
March 2015.
Below is a breakdown of our R&D personnel working on the three drug candidates as of
the Latest Practicable Date.
Department
Number of
Employees* R&D Roles and Responsibilities
Clinical Development
Head
1 Oversee and coordinate clinical operation,
clinical science, quality GCP , data
manager, pharmacovigilance and
statistician
Clinical science 2 Protocol development, medical monitoring,
CSR
Data manager 1 Data management
Statistician 1 Statistical plan, statistical analysis
Clinical operations 6 Clinical study conduct, drug supply
Pharmacovigilance 1 Drug safety, pharmacovigilance
Quality GCP 1 Quality assurance (following GxP
guidance)
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Department
Number of
Employees* R&D Roles and Responsibilities
Regulatory affairs 3 Regulatory activities in relation to China
authority, such as IND/BLA/quality
control testing
Medical affairs 7 Epi data of disease collection,
communication and engage KOLs for
product and disease
CMC 8 CMC-related activities including process,
analytical and formulation development,
and pre-clinical, clinical and
commercial supply manufacturing
support
Total 31
Note:
* During the Track Record Period and up to the Latest Practicable Date, none of our R&D staff has been
previously employed by Ascendis Pharma, and Ascendis Pharma has no R&D staff whose sole job
responsibility is to interact with us.
Our R&D team has extensive expertise in medical science, regulatory, clinical operation,
quality assurance, pharmacovigilance and data management, statistics, and medical affairs,
enabling us to lead and guide the external CROs and collaboration partners in a more efficient
and effective manner. As of the Latest Practicable Date, our R&D team consists of 31 full-time
employees, with approximately 45% holding a Ph.D. or an M.D. degree. We expect to grow our
R&D team as we continue our development activities. Almost all of our R&D team members
have in-depth industry knowledge and clinical development experience in multinational
companies. Our R&D team has an average of over 14 years of experience in the clinical
development of drugs and/or endocrine therapies and some of them have extensive expertise
in endocrinology and related areas and worked on the clinical development of other endocrine
drugs. Despite experiencing employee turnover within a reasonable range, primarily due to
retirements or resignations for personal reasons, which did not have any material impact on our
R&D capabilities or business operations going forward, we maintain a robust and relatively
comprehensive R&D organization structure, as demonstrated by a series of R&D milestones
that we have achieved during the Track Record Period.
To date, our R&D team has demonstrated a strong capability to optimize study design and
development strategy in China, which has enabled us to advance our drug candidates directly
into pivotal studies, work seamlessly with our collaboration partners, and conduct clinical
execution in an efficient manner. Specifically, in April 2022, we completed the China Phase 3
pivotal trial of the Core Product; in January 2023, we completed the double-blind period for
the ongoing China Phase 3 pivotal trial of palopegteriparatide; and in March 2023, TransCon
CNP (navepegritide) has completed the double-blind period of Phase 2 clinical trial in China
for the treatment of ACH. In anticipation of the indication expansion of ISS for the Core
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Product, we plan to expand our R&D team in respect of clinical operation starting from 2026.
We also plan to build up our R&D team in CMC field, such as drug product development
scientist and quality assurance manager, based on the respective expected timeline for
Technology Transfer and Localization and collaboration with WuXi Biologics. As
demonstrated by a series of R&D milestones achieved by us during the Track Record Period
and up to the Latest Practicable Date, we believe our in-house R&D team with talent pool
expanding with our future R&D timeline will be sufficient for the purpose of executing our
R&D activities independently without assistance from Ascendis Pharma. Further, between
2024 and 2027, we expect to continue to conduct R&D activities in relation to the
lonapegsomatropin drug substance technology transfer and localization, which involves
transferring the know-how of and localizing the manufacturing technology of the Core Product
drug substance from Ascendis Pharma to us at the designated local CDMO, WuXi Biologics.
During the same period, we will develop dual chamber device (DCD) technology for the drug
product and conduct comparability studies to prove that the locally produced drug product is
comparable to the imported drug product. Upon the completion of relevant R&D activities and
obtaining the Local BLA registration, we will be able to manufacture the Core Product
independently without assistance from Ascendis Pharma. With our insights and expertise in the
endocrinology field, we believe we are able to navigate the research, development, regulatory
and commercialization landscape in China and seek opportunities to maximize the full value
of each of our pipeline assets and future endocrine drug candidates. For further details
regarding the R&D activities conducted by us to date, see “– Our Drug Pipeline –
Lonapegsomatropin – A Long-Acting hGH Replacement Therapy for PGHD – Our R&D
Work,” “Palopegteriparatide – A PTH Replacement Therapy Addressing the Underlying Cause
of HP – Our R&D Work” and “TransCon CNP (navepegritide) – A Disease-Modifying Therapy
for ACH – Our R&D Work.” For further details regarding the lonapegsomatropin drug
substance technology transfer and localization and DCD technology development, see “–
Research and Development – CMC Development Programs.”
Clinical Development Programs
Since the in-licensing of our drug candidates from Ascendis Pharma, our senior
management has led an internal clinical R&D team and worked in close collaboration with our
scientific advisory board and industry-leading CROs to carry out R&D activities. Our R&D
team reviewed all relevant clinical data generated from the global clinical trials of the three
drug candidates conducted by Ascendis Pharma and prepared for clinical trial initiations in
China. Leveraging strong domain knowledge in the specific disease epidemiology, disease
characteristics, local clinical practice as well as the current status of the market for the
indications targeted by these drug candidates, our R&D team designed and implemented the
study protocol for the clinical trials in China, and has successfully completed the pivotal Phase
3 trial of lonapegsomatropin for PGHD, the double-blind period of pivotal Phase 3 trial of
palopegteriparatide for adult HP and the double-blind period of Phase 2 trial of TransCon CNP
(navepegritide) for ACH.
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The study designs have taken into consideration both (i) the scientific rationale, such as
MoA, well established pre-clinical data, the most updated global clinical data, the global study
protocol, and local clinical practice; as well as (ii) market opportunities in China, such as
addressable patient population, product positioning and competitive landscape of each of our
drug candidates. Our clinical R&D team organized a number of meetings with the KOLs on our
scientific board to optimize the study designs for our drug candidates. In addition, our R&D
team engaged in pre-IND communications with the NMPA, have made multiple IND
submissions to the NMPA and have obtained the IND approval for all of our drug candidates.
Our R&D team manages all key aspects of our trials, oversees clinical development work
and performs the following functions: (i) clinical development strategy; (ii) market assessment
and demand analysis; (iii) trial proposal and protocol design, including study objectives and
primary/secondary endpoints; (iv) clinical site selections, initiations, management and
monitoring; (v) biostatistics, including data management and programming; (vi)
pharmacovigilance; (vii) quality assurance; (viii) investigator and site contracts; (ix) medical
and safety monitoring; (x) clinical data collection and statistical analysis; and (xi) regulatory
submission and communication. In addition, we leverage our external CROs to perform clinical
trials. We implemented a variety of measures to guide our CROs, including comprehensive
planning ahead of trial execution, regular communication and quality check of working
progress, milestone program based on quality assurance check, and a vendor management
system.
For further details regarding the R&D activities conducted by us to date, refer to “– Our
Drug Pipeline – Lonapegsomatropin – A Long-Acting hGH Replacement Therapy for PGHD –
Our R&D Work,” “– Our Drug Pipeline – Palopegteriparatide – A PTH Replacement Therapy
Addressing the Underlying Cause of HP – Our R&D Work” and “– Our Drug Pipeline –
TransCon CNP (navepegritide) – A Disease-Modifying Therapy for ACH – Our R&D Work.”
For further details regarding the R&D activities to be conducted by and responsible by us under
the applicable Exclusive License Agreements, refer to “– Collaborations – Exclusive License
Agreements with Ascendis Pharma.”
CMC Development Programs
Lonapegsomatropin Drug Substance Technology Transfer and Localization
According to the Exclusive License Agreement, we have the contractual right to obtain
full knowledge of the Core Product drug substance manufacturing technology knowhow from
Ascendis Pharma. To realize the medium-term commercial supply of lonapegsomatropin, in
July 2023, we entered into a bilateral Technology Transfer Master Plan of the Core Product
with Ascendis Pharma, which has marked the commencement of the Technology Transfer with
respect to the manufacturing of the Core Product from Ascendis Pharma to us and sets forth
the obligations of both parties under the Exclusive License Agreement with respect to the
Technology Transfer. After completion of the Technology Transfer, we will have the full
knowledge of the Core Product drug substance manufacturing technology knowhow to
independently collaborate with WuXi Biologics or any other chosen CDMO in China. Further,
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in December 2023, we entered into a bilateral collaboration agreement with WuXi Biologics,
pursuant to which WuXi Biologics will serve as the local CDMO of the Technology Transfer
to conduct the process development and validation achieving the localization of the
manufacturing technology. Completion of the Technology Transfer and Localization, which is
expected to be in 2027, will confer to us the technical capabilities to manufacture the Core
Product drug substance in collaboration with WuXi Biologics.
To implement the technology transfer, WuXi Biologics has, as requested by us, prepared
a Technology Transfer Protocol to outline the scope of work, the process flow, and the expected
timeline of the technology transfer. The Technology Transfer Protocol has been acknowledged
by Ascendis Pharma and us to standardize the technology transfer procedures between the
transferring units and the recipient. We do not expect to enter into a tripartite contractual
arrangement with Ascendis Pharma and WuXi Biologics with respect to the Technology
Transfer and Localization process of the Core Product.
The following table sets forth the details of the Technology Transfer Master Plan we
entered into with Ascendis Pharma and the collaboration agreement we entered into with WuXi
Biologics.
Technology Transfer Master Plan
(Our Company, Ascendis Pharma)
Collaboration Agreement
(Our Company, WuXi Biologics)
Signing Date July 2023 December 2023
Scope of Work Ascendis Pharma shall transfer (i) know-how
and documentations, (ii) manufacturing
process, including hGH intermediate,
lonapegsomatropin drug substance and
UBP2 enzymatic cleavage reagent, and
(iii) analytical methods for hGH
intermediate, lonapegsomatropin drug
substance and UBP2 enzymatic cleavage
reagent to our Company and selected local
CDMO.
WuXi Biologics shall serve as the local
CDMO for the purpose of the Technology
Transfer and Localization, and conduct
process development, process validation,
and BLA support of both the
lonapegsomatropin drug substance and
dual chamber device development of the
Core Product.
We will entrust WuXi Biologics with the
local commercial supply of the Core
Product.
Payment No payment is required. We are required to make payments to Wuxi
Biologics according to the payment
schedule agreed by the parties.
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Technology Transfer Master Plan
(Our Company, Ascendis Pharma)
Collaboration Agreement
(Our Company, WuXi Biologics)
Confidentiality To ensure the confidentiality of the technical
information, a three-way confidentiality
agreement has been signed among our
Company, Ascendis Pharma and the
selected CDMO, WuXi Biologics.
We and Wuxi Biologics agree to keep
confidential any information in relation to
the performance of the agreement that is
reasonably deemed as confidential.
Dual Chamber Device Technology Development
In addition to the Technology Transfer and Localization, we are developing in-house
DCD technology in the form of prefilled syringe as a drug delivery system for freeze-dried
powder formed from lonapegsomatropin drug substance, as part of the intellectual property of
the drug delivery system currently used for lonapegsomatropin overseas is owned by an
overseas drug product contract manufacturing organization who is not able to transfer such
technology to us and at the same time does not own relevant allowed patent in China (including
Hong Kong, Macau and Taiwan), which allows us to develop in-house DCD technology free
of potential patent infringement with the contract manufacturing organization, as advised by
our legal adviser as to intellectual property law.
The DCD system addresses the limitations encountered by traditional drug delivery
system, including time-consuming preparation and susceptibility to contamination dosing. The
DCD system integrates two separate medication components in a single device, keeping the
chambers separate until administration to ensure the drug’s stability and integrity until it is
ready for use. The core technology of DCD involves the design and development of a container
closure system with two separate chambers that can be connected prior to use, enabling storage
and reconstitution of a drug and a diluent in a single device, alongside advanced filling and
freeze-drying manufacturing that surpass traditional drug delivery system.
Our senior R&D personnel led by the head of our CMC team, Dr. ZHU Jing, are equipped
with the expertise in biologics drug product development and are committed to the
development of the DCD technology in-house. As of the date of this document, we have
successfully achieved the lab-scale production of the DCD product. We expect to transfer the
DCD product manufacturing process which has been developed at lab-scale by our Company
to WuXi Biologics. Process characterization studies will be conducted to analyze critical
process parameters in order to establish a well-controlled list of critical quality attributes. See
“– Commercial Supply and Manufacturing – Step 2: Collaborative Local Manufacturing with
Local CDMO” for more details.
Local BLA
The Technology Transfer and Localization arrangement and the DCD development pave
our path to obtaining the Local BLA approval and achieving the collaborative local
manufacturing of the Core Product at the commercial scale, in details as follows.
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Timeframe
Lonapegsomatropin Drug Substance
Technology Transfer and Localization (Our
Company, Ascendis Pharma and WuXi
Biologics)
Dual Chamber Device (DCD) Development
(Our Company and WuXi Biologics)
2023-2027E  Technology Transfer and Localization and
lab-scale lonapegsomatropin drug
substance production. Technical documents
and know-how are being transferred from
Ascendis Pharma to us and selected CDMO
to implement the laboratory-scale studies,
for example, transferring raw materials,
methods reference standards and technical
information to WuXi Biologics that will
conduct the laboratory studies, gap
analysis, process facility fitness studies,
methods transfer and verification at the
laboratory, and local process lock.
 Manufacturing scale-up from lab-scale to
the Good Manufacturing Practice (GMP)
production.
/H18537GMP manufacturing preparation:
equipment, facility and materials.
/H18537Engineering run production for the
purpose of demonstrating that the local
process can be scaled-up successfully
and get ready for the Process
Performance Qualification (PPQ) runs.
/H18537Process Performance Qualification
(PPQ) run production to demonstrate the
capability of reproducible commercial
manufacturing.
 In-house lab-scale development. As of the
Latest Practicable Date, by utilizing the
Pre-PPQ DS, we have developed in-house
the DCD technology in the form of
prefilled syringe as a drug delivery system
for the lonapegsomatropin drug substance
at lab-scale, including the development of
the DCD container closure system,
verifying the drug product process,
evaluating compatibility with the container
closure system, and assessing equipment
and infrastructure requirements.
 Anticipated DCD know-how transfer from
our Company to Wuxi Biologics and
process characterization. We expect to
transfer the DCD product manufacturing
process which has been developed at lab-
scale by our Company to WuXi Biologics.
Process characterization studies will be
conducted to analyze critical process
parameters in order to establish a well-
controlled list of critical quality attributes.
 Manufacturing scale-up. We plan to
conduct engineering runs to scale up the
manufacturing process from lab-scale to
at-scale production, ensuring the quality
consistency of the DCD products.
 Process V alidation. V alidation studies will
subsequently be conducted to ensure that
the manufacturing process consistently
yields DCD products that adhere to
predefined quality standards.
As the Core Product is a biological product combined with the TransCon technology, its
manufacturing process involves plenty of steps and strict quality control. As advised by Frost &
Sullivan, completion of both lonapegsomatropin drug substance technology transfer and the DCD
technology development in approximately three years is in line with the industry normal practice,
upon which time we would possess the technology and capability to produce the Core Product
independently in China and there is no additional technology required for us. The cost of the
foregoing projects mainly consists of FTE costs, material costs for various batches from lab-scale
to commercial scale, and CDMO charges. We have allocated approximately HK$96.5 million
(representing 16.0% of net proceeds of the Global Offering) for the foregoing projects. See
“Future Plans and Use of Proceeds” for more details.
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Timeframe Local BLA Preparation and Submission
2027E-
2028E
With the completion of both lonapegsomatropin drug substance technology transfer and the DCD
technology development, we plan to target the following in relation to the BLA preparation and
submission:
 Conduct stability study of the PPQ batch samples
 Conduct comparability studies of the locally produced product against the imported product to
provide analytical confirmation that the similar quality attributes between locally produced
product and the imported product, including CMC lab comparison and animal study
comparison
 Compile BLA dossier
 Submit the Local BLA with the NMPA
 Prepare for the pre-approval inspection from the NMPA
2028E Expected Local BLA Approval and Commencement of Collaborative Local Manufacturing
Under the Exclusive License Agreement, we have established the preliminary framework
for a purchase agreement with Ascendis Pharma concerning materials intended for the
Technology Transfer and Localization upon the successful completion of the Global Offering.
Currently, only initial arrangements have been made under this framework, with no additional
actions taken at this stage. We believe that it is unlikely to fail in reaching such agreement with
Ascendis Pharma, given that (i) such agreement will be on normal commercial terms and is for
both parties’ mutual benefits, and (ii) the raw materials purchase is a necessary part of the
Technology Transfer and Localization which Ascendis Pharma shall cooperate in good faith to
facilitate pursuant to the Exclusive License Agreement entered with us.
Scientific Advisory Board
Our R&D team is backed by a scientific advisory board comprising reputable KOLs in
endocrinology and pediatrics in China. Our scientific advisory board provides expertise and
advice to our product portfolio strategy including providing inputs to our development plan,
and execution and lifecycle management of our pipeline drug candidates, and also assists with
the overall supervision of the product portfolio development and enrichment.
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Members of our scientific advisory board are not employees of our Group and we
compensate them for providing the above services based on hourly rates at fair market value
for a term of one year subject to a service fee cap, and arrange for travel and accommodation
for their attendance of the consultation meeting in accordance with the consulting service
agreements they entered into with the Company.
Two previous members of our scientific advisory board serve as principal investigators
(the “Overlapping Members”) for our clinical programs – one member served as the principal
investigator for our completed Phase 3 pivotal trial for lonapegsomatropin in PGHD in China,
and the other member served as the principal investigator for the China Phase 3 pivotal trial
for palopegteriparatide in adult HP in China. A principal investigator is a physician who leads
the conduct of a clinical trial at a study site. According to GCP , the principal investigator is
responsible for ensuring the study is conducted in accordance with regulatory requirements and
GCP . Compliance with GCP provides for assurance that the rights, safety and well-being of
trial participants are protected, and that the results of the clinical trials are credible and
accurate. Pursuant to their respective consulting service agreements, each of the Overlapping
Members was entitled to a maximum of RMB120,000 based on an hourly rate of RMB3,000
for up to 40 hours during a term of one year, which was determined on an arm’s length basis
at prevailing market rate. For the year ended December 31, 2021, the Overlapping Members
received RMB3,000 and RMB32,000, respectively, for their services rendered pursuant to their
respective consulting service agreements, which were within the service fee cap under the
relevant consulting service agreements.
Our principal investigators were employees of the trial sites who are contracted and
compensated by the trial sites for supervising our clinical trials. They are not employees of our
Group and we do not enter into contracts with them for acting as the principal investigators in
connection with our clinical trials. We selected qualified clinical trial sites based on their
qualifications and experience, contracted with the sites for conducting our clinical trials and
reimbursed the sites for the expenses incurred by them in carrying out the trials including
employee costs. The principal investigators were contracted and compensated by the trial sites
as their employees for supervising our clinical trials. In addition, one of the Overlapping
Members had been serving as a member of the steering committee for our study of
lonapegsomatropin since October 2019. He received certain compensation for the two years
ended December 31, 2020 and 2021, respectively for the consulting services provided in
connection with the study designs of lonapegsomatropin under the relevant consulting service
agreement he entered into with the Company, which were determined on an arm’s length basis
and based on an hourly rate at prevailing market rate.
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Our PRC Legal Adviser confirmed that our consulting service arrangements with the
Overlapping Members, are in compliance with the PRC law and there is no requirement from
the NMPA or other competent PRC authorities regarding: (i) the compensation paid by us to
members of our scientific advisory board who are also our principal investigators, and (ii) the
disclosure of the above compensation paid by us.
We believe that we have implemented sufficient measures to ensure the integrity of our
clinical studies and the independence of the opinions of our clinical trial principal investigators
on the basis that (i) our Phase 3 pivotal trial of our Core Product for the treatment of PGHD
was specifically designed in accordance with the applicable protocol and legal, regulatory and
scientific standards, to ensure that no individual could impact the outcome of the study once
the protocols were established and the trial commenced. We are not aware of any incidents or
conflict of interests that resulted in any breach of applicable standards or laws by our principal
investigators when providing services in connection with our clinical trials; (ii) under the
consulting service agreements, the Overlapping Members must declare sponsorship from the
Company if their services provided under their respective consulting service agreements
involve direct contact with the patients, and undertake that they will remain independent of all
decisions relating to drug choice they make; (iii) our principal investigators are required to
comply with GCP , GVP , and other regulatory regulations and guidelines enforced by the NMPA
and comparable regulatory authorities for all of our drug candidates in clinical development as
well as their employers’ internal policies, which provide for procedures to ensure that trials are
properly conducted and generation of reliable data; and (iv) we maintain a qualified and
experienced quality assurance team responsible for ensuring that we and our investigators and
CROs maintain compliance with all applicable regulations, standards, protocols and internal
policies.
Steering Committee for Phase 3 Pivotal Trial in PGHD in China
To ensure smooth initiation and operation of scientifically-sound studies, we set up a
steering committee comprising KOLs, overseas clinical professional experts and
biostatisticians. Three investigators sit in the steering committee, including Professor Xiaoping
Luo, who holds various positions in Tongji Hospital, Tongji Medical College of Huazhong
University of Science and Technology, Professor Junfen Fu from Children’s Hospital of
Zhejiang University School of Medicine and Professor Chunxiu Gong from Beijing Children’s
Hospital. Professor Ruihua Sun from China-Japan Friendship Hospital and Professor Martin O.
Savage from London, United Kingdom are the Biostatical Expert and Consultant of the steering
committee, respectively. The steering committee provides expertise and advice in order to
supervise the progress of the trial, reviews at regular intervals all relevant information that may
affect the study conduct as well as endorse and support patient enrollment goals in compliance
with relevant guidelines.
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Data Monitoring Committee for Phase 2 Clinical Trials of TransCon CNP (navepegritide)
in Children with ACH
A data monitoring committee (“DMC”) was established for the global Phase 2 trial and
the China Phase 2 trial, both of which are clinical trials for TransCon CNP (navepegritide) in
children with ACH. The DMC convenes to provide recommendations on the action to be taken
(i.e., continue the trial(s) (including planned dose escalation) without modification; continue
the trial(s) with modifications; or discontinue the trial(s)) based on review of the unblinded
data. In the global Phase 2 trial, once all participants in a cohort have received at least 12 weeks
of treatment, the DMC will review all available data and make a recommendation regarding the
initiation of the next higher dose cohort. In the China Phase 2 trial, the DMC will determine
the dose level for the open label period, based on the dose escalation data in both the global
Phase 2 trial and the China Phase 2 trial. The Chairperson of the DMC is Erin Nissen Castelloe,
MD, a pharmaceutical medicine consultant based in California, United States. The DMC also
consists of three other members who are reputable in the areas of endocrinology and pediatrics.
Bradley S. Miller, MD, PhD is Professor of Pediatrics, Pediatric Endocrinology from
University of Minnesota Masonic Children’s Hospital. Eric T. Rush, MD, FAAP , FACMG holds
various positions including the Clinical Geneticist in the Division of Clinical Genetics and the
Medical Director of the Office of Faculty Affairs and Development in Children’s Mercy Kansas
City, the Associate Professor of Pediatrics in University of Missouri-Kansas City, and the
Clinical Associate Professor (V olunteer) of Internal Medicine of University of Kansas Medical
Center. Huijuan Zhu, MD is the Chief Physician of the Department of Endocrinology, Peking
Union Medical College Hospital in Beijing, China.
Relationships with CROs and SMOs
We collaborate with reputable CROs and SMOs for the support of our clinical trials in line
with industry practice. We select our CROs and SMOs through an objective bidding process,
considering multiple factors such as professional experience, qualifications, quality assessment
and service fees, among others. Our CROs offer a comprehensive range of services required for
complex clinical trials in accordance with the agreed trial design and under our supervision,
while our SMOs provide an extensive array of services to assist us in executing and overseeing
clinical trials, including trial preparation, clinical safety management, data management, and
report preparation. We choose to engage CROs and SMOs based on the complexity, flexibility,
and workload of specific trial requirements, allowing us to leverage the experience and
expertise of our in-house team on critical elements like clinical science, new site selection, and
early setup, while delegating other tasks to the CROs and SMOs. We closely monitor our CROs
and SMOs to help ensure their performance will comply with all applicable laws and
regulations as well as follow our protocols, which in turn protects the integrity and authenticity
of the data from our clinical trials and studies. We have demonstrated our ability to conduct
clinical trials in a reliable and efficient manner through collaboration with CROs and SMOs
through the multiple milestones we have achieved so far.
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We have worked with CROs and SMOs for our clinical trials, including the clinical trial
for lonapegsomatropin. For example, under our respective agreements with the CRO and the
SMO in relation to the clinical trial for lonapegsomatropin, we are responsible for protocol
development and medical monitoring, while the CRO and the SMO take responsibility for
clinical monitoring, project management, data management and clinical study report. In return
for their services, we make scheduled payments as agreed in the agreements. We and the CROs
and SMOs are allowed to contract for multiple projects through the issuance of multiple work
orders without having to re-negotiate the basic terms contained in the agreement, for which
extra fees will be incurred. Under the agreements, we own all intellectual property and trial
results and the CRO and the SMO must maintain strict confidentiality with respect to the
information they acquired from us during clinical trials.
During the Track Record Period, we engaged 4 CROs and 3 SMOs, respectively. The
following table sets forth the details of our major CRO and SMOs we engaged during the Track
Record Period.
Major
CRO and
SMOs Background Involvement and Contribution
Annual Transaction
Amount as of
December 31,
Transaction
Amount
For the
Nine Months
Ended
September 30,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Supplier C A CRO based in Hangzhou,
providing full value chain for
clinical development
 Core Product: safety
evaluation, clinical trial
execution, and central
image, CSR preparation
 Palopegteriparatide:
assist us with data
management, safety
information collection
and biostatic analysis
 TransCon CNP
(navepegritide):
pharmacovigilance
service for safety
evaluation
5,355 1,413 1,638
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Major
CRO and
SMOs Background Involvement and Contribution
Annual Transaction
Amount as of
December 31,
Transaction
Amount
For the
Nine Months
Ended
September 30,
2022 2023 2024
RMB’000 RMB’000 RMB’000
SMO A A SMO based in Shanghai,
providing all in all medical
research service
Implementation and
management of clinical trials
for the core production
palopegteriparatide in the
PRC, including trial
preparation, clinical safety
management, data
management and report
preparation
1,860 935 297
SMO B A SMO based in Hangzhou,
providing all in all medical
research service
Implementation and
management of clinical trials
for the core production of our
three drug candidates in the
PRC, including trial
preparation, clinical safety
management, data
management and report
preparation
1,062 595 61
SMO C A SMO based in Beijing,
providing all in all medical
research service
Implementation and
management of clinical trials
for the core production of
TransCon CNP
(navepegritide) in the PRC,
including trial preparation,
clinical safety management,
data management and report
preparation
267 33 209
Total 8,544 2,976 2,205
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R&D Expenses
For each year ended December 31, 2022, 2023 and the nine months ended September 30,
2024, our total R&D expenses amounted to RMB179.5 million, RMB57.7 million and
RMB58.9 million, respectively. See “Financial Information” for more details. We expect that
our R&D expenses to increase generally in line with the advancement of our clinical and
development programs in the future.
During the Track Record Period, we procured R&D consulting services from Ascendis
Pharma mainly for the following activities: (i) for lonapegsomatropin, (a) the
pharmacovigilance and biometry for data analysis including statistical programming and
statistical analysis, and (b) the regulatory strategy advice and documentation support to prepare
for our Import BLA submission package with the NMPA; (ii) for TransCon CNP
(navepegritide) and palopegteriparatide, the pharmacovigilance and biometry for data analysis
including statistical programming and statistical analysis. The amount of R&D consulting
services rendered by Ascendis Pharma relating to our three drug candidates was RMB8.0
million, RMB10.0 million and RMB11.7 million in 2022, 2023 and the nine months ended
September 30, 2024, respectively. In connection with our expected R&D and regulatory
activities of three drug candidates, we expect to procure R&D consulting services from
Ascendis Pharma mainly for the following activities: (i) for lonapegsomatropin, (a) the
technology transfer of lonapegsomatropin drug substance from Ascendis Pharma to us, and (b)
consulting the technology localization process that involves the lonapegsomatropin drug
substance manufacturing scale-up; (ii) for TransCon CNP (navepegritide) and
palopegteriparatide, the support of data programming and statistical analysis, and the
regulatory strategy advice and documentation support in connection with our expected NDA
with the NMPA. See “Connected Transactions – Non-Exempt and Partially-Exempt Continuing
Connected Transactions – Exclusive License Agreements” for more details.
COMMERCIALIZATION PLAN, PATIENT SUPPORT AND MARKET ACCESS
We are solely responsible for and take full control over the commercialization of our Core
Product and two drug candidates in China (including Hong Kong, Macau and Taiwan). We
build up our in-house commercialization team in line with the overall R&D and
commercialization timeline of our drug candidate pipeline. In the past few years, we have built
up a specialized commercialization team with strong expertise in endocrinology, to drive
medical activities in the market of China (including Hong Kong, Macau and Taiwan) in
accordance with local rules and regulations. In April 2021, we added Dr. CHEN Jun, Ph.D., as
Chief Commercial Officer to our management team, to enhance our commercialization
capabilities. Dr. Chen has over 25 years of experience in the healthcare industry and over 20
years of experience in the commercialization of endocrine products, including growth
hormone. The addition of Dr. Chen enabled us to initiate the development of our product launch
team (including aspects of medical affairs and commercial strategy development) of ten
employees as of the Latest Practicable Date. In addition to Dr. Chen, our product launch team
also includes key leadership members such as medical affairs and marketing head Mr. GU
Qing, who has 18 years of marketing experience in the healthcare industry, and commercial
strategy development head Mr. PAN Haifeng, who has 22 years of experience in the
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commercialization of endocrine products. We believe our key commercialization leadership
members, who have substantial experience and strong track records relevant to our pipeline
drug candidates, can leverage their expertise launching endocrine drugs in China (including
Hong Kong, Macau and Taiwan).
In anticipation of the potential BLA approval of our Core Product in the second half of
2025 and subsequent commercialization activities later that year, we plan to expand our
commercial team equipped with field sales, regional marketing, medical affairs and customer
service functions starting from 2025. We also plan to build up our commercial infrastructure
for palopegteriparatide and TransCon CNP (navepegritide) based on the respective expected
commercial launch timeline. We believe our internal commercialization team with expanded
talent pool will be sufficient for the purpose of executing our commercialization plan. Further,
we have entered into a strategic collaboration agreement with Shanghai Pharmaceutical aiming
to establish the necessary management framework in line with the GSP . We have also entered
into the strategic collaboration with the United Family Healthcare to jointly develop
capabilities in diagnosis, treatment and services for children with medical needs in growth and
development.
The following sets forth the commercialization plans and strategies devised by our
product launch team for the three drug candidates in the market of China (including Hong
Kong, Macau and Taiwan).
Lonapegsomatropin
Lonapegsomatropin has the potential to capture a significant share in the highly attractive
hGH market in China. China accounted for the largest share of the global hGH market in 2023,
reaching RMB11.6 billion in 2023 at a CAGR of 23.9% from 2018 to 2023. The hGH market
in China is expected to continue its fast growth to reach RMB28.6 billion in 2030, powered by
increasing patient penetration, extending average duration of treatment, and growing
acceptance of LAGH treatment. The LAGH market is expected to increase from approximately
25.0% in 2023 to approximately 73.8% in 2030 of the total hGH market in China. The hGH
market in China is characterized with patient payment primarily out-of-pocket and sales
primarily from private hospitals and clinics, resulting in hGH product prices being less
vulnerable to various price-cutting measures such as price negotiation in NRDL and price cut
in volume-based procurement. The future competitive landscape of LAGH is expected to be
moderate, as there is currently one LAGH product available and only a handful of products
under development.
Lonapegsomatropin, with its profiles in efficacy, safety and convenience, is a promising
drug candidate among the potential competitors. Our commercialization strategies will be in
line with the expected growth of hGH and LAGH market size by focusing on the following
areas: (i) recognizing the importance of understanding the market and patient needs and
conducting necessary market research and feasibility studies to ensure our product meets the
market need; (ii) ensuring clear communication of our product’s benefits to the target market;
and (iii) establishing effective sales channels and distribution network and ensuring supply
capacity to meet the market demand.
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Since the commercial launch of lonapegsomatropin by Ascendis Pharma in the fourth
quarter of 2021, Ascendis Pharma has recorded sales revenue of lonapegsomatropin of EUR0.9
million, EUR35.7 million, EUR178.7 million and EUR197.0 million in 2021, 2022, 2023 and
2024, respectively, according to its annual reports.
Commercial Personnel
We have key commercialization leadership in place, including our Chief Commercial
Officer, medical affairs and marketing head, and commercial strategy development head. To
execute our commercialization plan for the Core Product in line with the anticipated launch
timeline, we plan to expand our commercial team starting from mid-2025. This team will be
equipped with field sales, regional marketing, medical affairs, sales training, channel
management, and customer service functions. We plan to establish a relatively small but elite
commercial team of 40-100 staff at our commercial launch to cover the top-tier hospitals and
to establish the brand position, followed by gradually expanding the team to 500-1,000 staff
to cover most of target market. For hospitals beyond our target market, we plan to establish
external partnerships with distributors and/or CSOs to broaden patient accessibility through
incremental coverage across China. We believe our internal commercialization team with
expanded talent pool will be sufficient for the purpose of executing our commercialization plan
for the Core Product.
Product Strategy
Our initial focus of commercialization is patients suffering from short stature and
diagnosed with PGHD. The commercial goal for lonapegsomatropin is two-fold: (i) to
accelerate market upgrade from short-acting daily growth hormone to long-acting weekly
growth hormone; and (ii) to establish lonapegsomatropin as the leading LAGH.
We plan to provide the treatments in selected endocrinology diseases by highlighting four
key product advantages: (i) lonapegsomatropin preserves the natural dual mode MoA of
endogenous growth hormone by releasing unmodified hGH, which includes both a direct effect
at the bone plate and the indirect effect mediated by IGF-1 at the liver. With this advantage,
lonapegsomatropin is the only LAGH that has demonstrated superior efficacy and comparable
safety in active-controlled and parallel-group trial comparisons with daily hGH, as validated
in the completed Phase 3 pivotal trial in China, potentially enabling children with PGHD to
achieve treatment goals more effectively within a limited treatment time window; (ii)
lonapegsomatropin demonstrates key pharmacological profiles, including a molecular structure
of the active drug substance, receptor binding affinity, plasma concentration, tissue
distribution, and a safety profile comparable to daily hGH, which has been utilized by
clinicians for over 30 years with a high level of confidence in its safety. In contrast, the other
LAGHs permanently alter the molecular structure of hGH, resulting in new active
drugmolecules that have significantly different pharmacological profiles from the daily hGH
and limited clinical experience; (iii) lonapegsomatropin offers more than 300 injection-free
days per year compared to daily hGH, thus could greatly improve treatment compliance and
treatment outcomes; and (iv) lonapegsomatropin can be stored for 54 months at 2-8°C or up to
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six months at room temperatures of /H1134930°C, a more patient-friendly storage requirement than
other growth hormone products that typically require constant storage at 2-8°C and for no more
than 24 months. This advantage offers great flexibility for children with PGHD and their
caregivers, enabling convenient transportation and usage of the medication. By effectively
communicating the value propositions of lonapegsomatropin to HCPs, we anticipate
successfully persuading prescribing doctors about the product’s benefits and establishing a
promising position in the market.
Based on this product strategy, as of the date of this prospectus, we are in the process of
developing training materials for new commercial personnel, educational materials for
patients, and promotional materials for prescribers.
Pricing
We expect the pricing of our Core Product to be determined by various factors such as (i)
the competitive landscape of the addressable market at the time of our commercial launch, (ii)
the value propositions of our Core Product including the drug efficacy and safety as well as the
drug administration convenience, (iii) the supply and production costs, and (iv) our pricing
strategies. As the Core Product is currently under the BLA review by the NMPA, we have not
formulated concrete pricing strategy at this stage but we expect that the Core Product will be
priced at a fair premium compared to its competitors in China (including Hong Kong, Macau
and Taiwan), reflecting its value propositions. As the hGH market in China is characterized
with patient payment primarily out-of-pocket and sales primarily from private hospitals and
clinics, we plan to primarily focus on the self-pay market for the commercialization of our Core
Product.
Promotion Programs
To realize our commercial goals, we have devised a competitive and productive
promotional program. The hGH market in China is highly concentrated, with the majority of
PGHD diagnoses being made by pediatric endocrinologists in around 200 top-tier hospitals in
China. To maximize the coverage of our target customer segment, we have identified around
1,000 public hospitals as our target market, including all major children’s hospitals as well as
major Tier 3 hospitals and some Tier 2 hospitals with sizable pediatric departments. In addition
to focusing on the target public hospitals that handle the majority of PGHD diagnoses, we also
plan to establish extensive coverage of private hospitals/clinics, which are responsible for
approximately 67% of hGH sales, where drug listing is relatively simple and patients can have
easy access to treatment initiation, prescription refills and quality customer services.
We also plan to deploy a series of programs towards patients undergoing
lonapegsomatropin therapy. These programs include providing a comprehensive patient starter
kit, offering assistance from a professional service team, and developing a digital patient
service platform to enhance patient experience and convenience. The digital patient service
platform includes social media and app that offer features such as injection guidance, FAQs,
refill-services, and virtual classrooms. This platform creates an ecosystem connecting patients,
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caregivers and physicians, aiming to improve the treatment experience and optimize
compliance and treatment outcomes. As PGHD patients have higher annual treatment costs and
longer treatment durations compared to many common chronic diseases, we expect such
programs will be productive.
Distribution Network
We have established strategic collaboration with Shanghai Pharmaceutical to leverage its
expertise and capabilities to assist us to establish the necessary management framework in line
with the GSP . We plan to deepen the strategic collaboration with Shanghai Pharmaceutical to
leverage its resources and network as importer and distribution partner. Our Core Product will
mainly be sold through selected public hospitals and private clinics. Shanghai Pharmaceutical
is one of the leading distributors in China with broad distribution network nationwide which
is largely sufficient to meet the distribution needs of our Core Product.
Commercial Partnerships
We have formed strategic partnership with United Family Healthcare, one of the leading
private healthcare providers in China with a network of over ten hospitals and over 20 clinics
across China. We can leverage its large hospital presence and patient base across China for
patient education and prescription. In addition, we may seek potential similar collaborations
with other leading private hospital chains.
We plan to promote our Core Product primarily through our in-house sales and marketing
team through various marketing activities focusing on promoting the clinical benefits and
accessibility of our Core Product. We may also engage contract sales organizations to promote
our Core Product in peripheral cities or regions that are otherwise not covered by our in-house
sales and marketing team.
TransCon CNP (navepegritide)
ACH is a widely recognized condition that can be readily diagnosed by experienced
pediatricians, resulting in a high awareness and diagnosis rate. Patients with ACH have normal
mental development and a pressing need for treatment prior to reaching puberty. There is no
available disease-modifying drug to treat ACH in China. TransCon CNP (navepegritide) is the
only disease-modifying drug under clinical development in China with positive efficacy results
in clinical trials. Once approved, TransCon CNP (navepegritide) is expected to be utilized by
patients over several years during the growth period from two to 15 years. In addition,
TransCon CNP (navepegritide) has a long half-life of 120 hours porting once-weekly dose
administration.
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Once TransCon CNP (navepegritide) is commercially available, our main commercial
goals are to build up the awareness of ACH among key stakeholders, establish TransCon CNP
(navepegritide) as the standard of care for ACH, and establish patient access. The successful
execution of this commercial strategy holds the potential to achieve a rapid revenue uptake
from TransCon CNP (navepegritide).
To build up the disease awareness among key stakeholders, we have already formed a
strategic alliance with CHARD in 2020 and supported its ApproaCH Registry Study, which was
kicked off in April 2021 and aims to generate China specific epidemiology data on ACH,
including disease prevalence, disease burden, and current diagnosis and treatment status. The
study will help key stakeholders understand the patient burden and potentially facilitate the
future inclusion of TransCon CNP (navepegritide) into NRDL, eventually benefitting most
patients with ACH in China. We have actively supported the establishment of October 3 as
ACH day in China and have been involved in organizing various patient activities in relation
to this important day over the past years.
To standardize ACH diagnosis and treatment, we have supported the development of the
first ACH Expert Consensus in China on Diagnosis and Treatment which was published in
Chinese Journal of Pediatrics in July 2021. Once TransCon CNP (navepegritide) is approved,
we plan to work with academy association, CHARD and clinical experts to update ACH
treatment guideline in China and establish TransCon CNP (navepegritide) as the standard of
care for ACH.
To establish market access of TransCon CNP (navepegritide) after its approval, we have
advocated for the inclusion of ACH in the second China Rare Disease List issued by the
National Health Commission in September 2023, highlighting the commission’s commitment
to improving disease treatment and increasing medicine accessibility for ACH. TransCon CNP
(navepegritide), as a potential treatment for ACH, can benefit from multiple favorite policies
for rare diseases in clinical development, drug registration, pricing and market access. Once the
product is approved, we will leverage the rare disease designation of ACH and the result of
ApproaCH Registry Study to include TransCon CNP (navepegritide) into the NRDL and
establish broad patient access.
We expect TransCon CNP (navepegritide) to be included in the NRDL soon after its
approval by undergoing the pricing negotiation process with relevant governmental authorities.
To optimize resources and maximize the effectiveness of our commercial efforts for TransCon
CNP (navepegritide), we have devised a comprehensive and productive program. Given that
the group of HCPs specialized in endocrinology or genetic diseases who treat ACH largely
overlaps with the target HCPs for lonapegsomatropin, we plan to leverage the promotional
synergy between TransCon CNP (navepegritide) and lonapegsomatropin. This includes
utilizing the shared field medical representative team, patient service infrastructure, channel
and distribution network, thereby minimizing the required promotion resources for TransCon
CNP (navepegritide).
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Palopegteriparatide
HP is a chronic disease characterized by the deficiency of PTH, which plays a crucial role
in calcium and phosphate metabolism. HP affects a significant patient population, with
approximately 410 thousand individuals affected in 2023. Patients with HP experience daily
challenges related to both physical and mental well-being and often require lifelong treatment.
The optimal approach for managing HP involves PTH replacement therapy to compensate for
the insufficient physiological levels of PTH in the body. Currently, there is no available PTH
replacement therapy for HP due to the extremely short half-life of native PTH, which lasts only
a few minutes. Palopegteriparatide, by leveraging the ability of the transient conjugation
technology (TransCon) to generate long-acting prodrugs of unmodified parent drugs,
successfully extends the half-life of PTH to 60 hours, and is potentially the first PTH
replacement therapy for HP treatment over multi-year or even lifetime. Palopegteriparatide
possesses many advantages over conventional therapy as demonstrated in the Phase 3 clinical
trials, and is the most advanced PTH replacement drug under clinical development in China
with few competing products.
The commercial goal for palopegteriparatide includes market development, patient access
and establishing HP treatment centers. Once commercially launched, we expect a rapid revenue
uptake of palopegteriparatide.
To develop the HP market, we have supported the PaTHway R study, the first China HP
registry study which kicked off in January 2022. This study aims to generate epidemiology data
of HP in China, including disease prevalence, disease burden, and current diagnosis and
treatment status. The study will help key stakeholders understand the patient burden and
broaden disease awareness. We have also planned for extensive patient education activities
through patient advocacy and social media to raise the awareness of HP and its disease burden,
and ultimately increase diagnosis and treatment rates. We have already started operating a HP
disease education platform in WeChat which has attracted around 5,000 subscribers, a potential
patient pool after palopegteriparatide launch. We have actively supported the establishment of
June 1 as the HP Day in China and have been involved in organizing various patient activities
in relation to this important day over the past years. We also plan to work with academic
associations and clinical experts to update the HP diagnosis and treatment guideline to include
Palopegteriparatide as the PTH replacement therapy for HP .
To establish market access of palopegteriparatide after its approval, we have advocated
for the inclusion of genetic HP in the second China Rare Disease List issued by the National
Health Commission in September 2023, highlighting the commission’s commitment to
improving disease treatment and increasing medicine accessibility for genetic HP .
Palopegteriparatide, as a potential treatment for HP (including genetic HP), can benefit from
multiple favorite policies for rare diseases in clinical development, drug registration, pricing
and market access. Once the product is approved, we will leverage the rare disease designation
of genetic HP , the result of PaTHway Registry Study and clinical value to include
Palopegteriparatide into NRDL and establish broad patient access. A sample program is also
planned to provide patients with easier access to the therapy.
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We expect palopegteriparatide to be included in the NRDL soon after its approval by
undergoing the pricing negotiation process with relevant governmental authorities. We plan to
deploy an effective and productive commercial program for palopegteriparatide. We plan to
deploy our commercial resources in a “hub-and-spoke” model. We plan to support dozens of
major hospitals with HP treatment expertise to establish HP Center of Excellence across China
as “hubs.” HP patients can receive high-quality diagnosis and key therapy decisions at these
“hubs.” In addition, we plan to cover a few hundred regional hospitals as “spokes.” The
“spoke” hospitals can identify potential HP patients, channel them to “hubs” for key therapy
decisions, while providing easy access for patients’ prescription refills and ongoing HP
management. As most HP patients are treated by adult endocrinologists, we plan to deploy a
separate adult endocrinology medical representative team and MSL team to cover these
hospitals. The “hub-and-spoke” model may allow us to leverage a small but elite medical
representative team and productive promotion program to cover broad geographic areas and a
large patient pool.
COMMERCIAL SUPPLY AND MANUFACTURING
We plan to implement a three-step plan to source commercial supply for the
commercialization of lonapegsomatropin as early as possible and address the vast domestic
market potentials in China (including Hong Kong, Macau and Taiwan) effectively and secure
sustainable drug supply for local patients.
Step 1: Commercial Drug Procurement from Importation
In the short term, we plan to source the commercial drug supply of Core Product from our
collaboration partner, Ascendis Pharma. We have signed a Commercial Supply Agreement in
October 2023 with Ascendis Pharma in anticipation of the potential BLA approval and
subsequent commercial launch of the Core Product. We agreed to purchase and Ascendis
Pharma agreed to sell, lonapegsomatropin drug packages, auto-injectors and demo products.
The amount to be paid to Ascendis Pharma shall be determined by the manufacturing costs that
may be incurred by Ascendis Pharma plus an additional 20% markup. The Commercial Supply
Agreement will secure the imported drug supply after the expected BLA approval for the initial
commercial launch of the Core Product in China. We expect the quantity of relevant products
to be sufficient for the initial commercial launch according to our commercialization plan. We
may utilize the net proceeds of the Global Offering to fund payment for the commercial supply
of additional Core Product from Ascendis Pharma based on the market demand, before our
expected collaborative local manufacturing capability is established in 2028.
After the expected initial commercial launch of the Core Product in China, patients for
drug administration of the imported Core Product will need to purchase (i) lonapegsomatropin
drug package, comprising (a) Core Product in the form of dual chamber cartridge injection, and
(b) disposable injection needle; and (ii) a separate auto-injector, which is reusable in nature and
can improve patient injection experience and compliance. The Core Product is used exclusively
with the auto-injector. In the short term, we will procure the lonapegsomatropin drug packages
and auto-injectors from Ascendis Pharma pursuant to the Commercial Supply Agreement.
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The approvals from the FDA and EMA of lonapegsomatropin include an auto-injector and
cartridges which, after first removed from a refrigerator, allow families to store the medicine
at room temperature for up to six months. This is the first FDA-approved once-weekly pediatric
growth hormone delivered with an auto-injector. This state-of-the-art auto-injector was first
introduced in the enliGHten Trial and was designed to be user-friendly and improve treatment
compliance for pediatric with GHD. The auto-injector provides a fully automated
reconstitution of the lyophilized drug product which is followed by a manual mixing step
controlled by the device. With simple operation, the device has a single, low-volume injection
for the majority of patients of less than 0.6 mL and requires a small, 31-gauge needle that is
only 4 millimeters in length, which is comparable to needles used to administer daily hGH.
When the injection needle is inserted into the skin, the device automatically delivers the drug
product. The built-in electronics and software assist the user during the entire preparation and
injection sequence and provide confirmation that the full dose has been delivered.
According to relevant laws and regulations in China, the auto-injector is classified a
medical device exempted from clinical trial requirements in accordance with the Catalogue of
Medical Devices Exempted from Clinical Evaluation (ᑗґ൙ᄆᔼᐕኜ૛ͦ፽)
promulgated by the NMPA, and requires the registration dossier with the NMPA separate from
the BLA submission for the Core Product for PGHD. The import medical device registration
application for the auto-injector was submitted by a third-party marketing authorization holder
to the NMPA in June 2023 and has been approved in April 2024, ahead of the expected BLA
approval date of the Core Product for PGHD in the second half of 2025. Since the Core Product
is used exclusively with the auto-injector produced by such marketing authorization holder, we
expect to rely on its auto-injector supply before we establish our collaborative local
manufacturing capability with local CDMO. See “– Commercial Supply and Manufacturing –
Step 2: Collaborative Local Manufacturing with Local CDMO.”
Starts injection when pressed
against skin
Green Top
Allows for inspection of mixed
medicine
Inspection Window
Status Icons
Shows progress of mixing and injection
Progress Bar
To turn on auto-injector or to reject mixed
medicine
Button
Needle
Contains medicine
and water for injection
Cartridge
Battery Icon
Source: Ascendis Pharma ©
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In relation to the Commercial Supply Agreement, we entered into a quality agreement
with Ascendis Pharma in June 2024, which elaborated details of the Commercial Supply
Agreement to ensure compliance with GMP and other relevant laws and regulatory guidelines
for the Core Product production. Further, we may utilize the net proceeds of the Global
Offering to fund the payment for additional commercial supply of lonapegsomatropin from
Ascendis Pharma based on the market demand. See “Future Plans and Use of Proceeds” for
more details. Even if in the unlikely event that the execution of the foregoing additional
commercial supply agreement fails, we will still be able to commercialize our drug candidates
in China (including Hong Kong, Macau and Taiwan) under existing contractual arrangement
with Ascendis Pharma. Therefore, we believe any failure to execute the foregoing additional
commercial supply agreement will not directly hamper our business, financial condition or
results of operations.
For our other drug candidates in the pipeline, we may determine to source the commercial
drug supply of TransCon CNP and palopegteriparatide from Ascendis Pharma in the future
subject to the pace of the regulatory review and our commercialization plan.
Step 2: Collaborative Local Manufacturing with Local CDMO
In the medium term, we will collaborate with WuXi Biologics for the commercial
production of lonapegsomatropin. Upon the completion of CMC R&D work and the approval
of the Local BLA, which is expected in 2028, we will commence the product supply and
commercial sales of the Core Product produced at the local CDMO, WuXi Biologics.
As advised by Frost & Sullivan, in the context of rapidly growing new drug development
costs, increasingly complex development processes, and even more intense competition,
multinational pharmaceutical and biotechnology companies have continued to increase
outsourcing to CDMOs, and the reliance on CDMO services is in line with the industry norm.
Going forward, we will regularly assess CDMO performance based on metrics such as on-time
delivery, product quality and cost-effectiveness. We will ensure to establish trust and
commitment with CDMO through transparent communication and collaboration, which we
believe will allow for better risk-sharing and problem solving. In the long term, we will build
internal capabilities for manufacturing our products in-house to reduce our reliance on CDMO.
See “– Commercial Supply and Manufacturing – Step 3: In-house Manufacturing.”
Step 3: In-house Manufacturing
In the long term, we plan to establish our in-house manufacturing capabilities.
We strive to establish a recognized and leading franchise in endocrinology that integrates
research and discovery, clinical development, commercialization, manufacturing and business
development and become a partner of choice for endocrine treatment looking to enter China
(including Hong Kong, Macau and Taiwan), which we believe will enable us to more deeply
explore the hGH market in China, which has already exceeded RMB11.6 billion by 2023,
increasing at a CAGR of more than 23.9% over five years.
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Strategic Change Regarding Commercial Drug Procurement Arrangement
In relation to the Core Product supply, we entered into three agreements with Ascendis
Pharma in details as follows. See “Connected Transactions” for more details.
Cost Sharing and Volume
Commitment Agreement
Commitment and Pre-
payment Agreement
(1)
Commercial Supply
Agreement
Signing Date December 2021 August 2022 October 2023
Term December 2021 – December
2026
August 2022 – upon
fulfilment of obligations
thereunder
N/A
Description The Cost Sharing and
V olume Commitment
Agreement dictates that
we have the right to
reserve from Ascendis
Pharma the volume of
lonapegsomatropin drug
substance produced at
Overseas CDMO B (as
defined below in note (1))
until 2026 for future
production of the Core
Product to be supplied by
Ascendis Pharma.
The Commitment and Pre-
payment Agreement was
entered pursuant to the
Cost Sharing and V olume
Commitment Agreement,
and we confirmed with
Ascendis Pharma that two
batches of
lonapegsomatropin drug
substance to be produced
at Overseas CDMO B
(“Reserved Drug
Substance”) will be
reserved for future
production of the Core
Product to be supplied by
Ascendis Pharma.
The Commercial Supply
Agreement was entered in
anticipation of the
potential BLA approval
and subsequent
commercial launch of the
Core Product. We agreed
to purchase, and Ascendis
Pharma agreed to sell,
lonapegsomatropin Drug
Package (as defined
below), auto-injector and
Demo Product (as defined
below).
Product Lonapegsomatropin drug
substance
Lonapegsomatropin drug
substance
 Drug package,
comprising (i) dual
chamber cartridges
containing
lonapegsomatropin drug
substance, and (ii)
injection needle (“Drug
Package”).
 Auto-injector
 Demo product items
intended for marketing
display (“Demo
Product”).
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Cost Sharing and Volume
Commitment Agreement
Commitment and Pre-
payment Agreement (1)
Commercial Supply
Agreement
Product Quantity Not exceeding 25% of the
reserved capacity of
lonapegsomatropin drug
substance by Ascendis
Pharma at Overseas
CDMO B.
N/A
(1)  Drug Package: four
batches upon our
notification to Ascendis
Pharma to initiate
manufacturing, specifying
the amount to be
allocated to each batch.
 Auto-injector: four
batches to be delivered to
us following our binding
purchase orders
specifying the requested
amount.
 Demo Product: specified
amount.
Consideration Amount to be paid to
Ascendis Pharma shall be
determined by 25% of the
actual costs incurred by
Ascendis Pharma for the
establishment of
production capacity of
lonapegsomatropin at
Overseas CDMO B, with
our total payment not
exceeding 25% of the total
estimated cost in the Cost
Sharing and V olume
Commitment Agreement
without our prior written
consent.
N/A
(1) Amount to be paid to
Ascendis Pharma shall be
determined by
manufacturing costs that
may be incurred by
Ascendis Pharma plus an
additional 20% mark up.
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Cost Sharing and Volume
Commitment Agreement
Commitment and Pre-
payment Agreement (1)
Commercial Supply
Agreement
Status In 2022, 2023 and the nine
months ended September
30, 2024, the amount paid
by us to Ascendis Pharma
under the cost sharing
arrangement was
approximately RMB21.6
million, RMB8.5 million
and nil, respectively. In
exchange, we obtained
ownership of certain
amount of Pre-PPQ
lonapegsomatropin drug
substance
(2) from Ascendis
Pharma. Due to the
completion of this project,
we expect to incur no
further costs under such
cost sharing arrangement.
Due to the Strategic
Change
(1), we exercised
the right to cancel our
commitment to purchase
the Reserved Drug
Substance (as defined
below) in February 2023.
 Drug package: a payment
of RMB39.2 million
(EUR5.0 million) was
made by us for the Drug
Package in November
2023. The remaining
purchase price of the
Drug Package will be
paid in two installments
in later stage in line with
our commercialization
plan.
 Auto-injector: no
payment has been made
during the Track Record
Period.
 Demo Product: no
payment has been made
during the Track Record
Period.
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Cost Sharing and Volume
Commitment Agreement
Commitment and Pre-
payment Agreement (1)
Commercial Supply
Agreement
Impact on the
commercialization
plan
The Cost Sharing and
V olume Commitment
Agreement has not yielded
commercial supply to us.
However, it has secured a
backup supplier of
lonapegsomatropin drug
substance at Overseas
CDMO B in case it is
needed, and enables us to
obtain certain amount of
Pre-PPQ
lonapegsomatropin drug
substance
(2) which the
Company that can be used
for ongoing and future
R&D activities.
N/A
(1) The Commercial Supply
Agreement will secure the
imported drug supply after
the expected BLA
approval for the initial
commercial launch of the
Core Product in China. We
expect the quantity of
relevant products under
the Commercial Supply
Agreement to be sufficient
for the initial commercial
launch according to our
commercialization plan.
We may utilize the net
proceeds of the Global
Offering to fund the
payment for the
commercial supply of
lonapegsomatropin from
Ascendis Pharma based on
the market demand. See
“Future Plans and Use of
Proceeds” for more
details.
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Notes:
(1) Strategic change relating to the lonapegsomatropin drug procurement and local manufacturing plan
In light of our focus on capital efficiency and sustainability as well as uncertainties surrounding the
capital market and the related impacts, we have made strategic change (the “Strategic Change”) relating
to the lonapegsomatropin drug procurement and local manufacturing plan. Initially, we planned to (i)
sell imported drugs supplied by Ascendis Pharma with drug substance produced by an overseas CDMO
A (“CDMO A”), and in line with the projected market demand, transit to (ii) sell imported drugs
supplied by Ascendis Pharma with drug substance produced by an overseas CDMO B (“CDMO B”) who
is capable of producing drug substances in larger scale compared to that of CDMO A, and (iii) ultimately
sell drugs produced locally by building our own manufacturing facility (collectively, the “Initial
Strategy”). Under the current strategy, (i) in the short term, we will sell imported drugs supplied by
Ascendis Pharma with drug substance produced by the CDMO A, and (ii) in medium term, we will
partner with WuXi Biologics, the chosen local CDMO, to achieve local manufacturing of Core Product,
instead of building our own manufacturing facility (collectively, the “Current Strategy”).
The chart below illustrates our transition from the Initial Strategy to the Current Strategy:
Step 1.1: Commercial drug
procurement from Ascendis Pharma
Step 1.2: Commercial drug procurement from
Ascendis Pharma on a larger scale
Initial Strategy (in effect until the end of 2022)
Step 1: Commercial drug procurement from
Ascendis Pharma
Current Strategy (since early 2023)
E2025 E2028
~ 2 years of less capital
expenditure
Step 2: In-house Manufacturing
Step 2: Collaborative Local Manufacturing
E2025 E2030Strategic
Change
As part of our Strategic Change, we have taken the following strategies:
Cancellation of the lonapegsomatropin drug substance reserved under the Commitment and Pre-payment
Agreement
Under our Initial Strategy, we had previously placed an order for the Reserved Drug Substance to be
produced by the CDMO B scheduled in early 2023. To secure these batches, we have made prepayment
under the Commitment and Pre-Payment Agreement, which only represented a fraction of the
anticipated total cost. Had the production moved forward, we would have faced an additional substantial
payment obligation, which would have significantly drained our financial resources for that year.
Further, extra regulatory vetting time would be required to secure a separate import BLA for the Core
Product with drug substance produced by the CDMO B, as the Core Product with drug substance
produced by the CDMO A was used in pivotal clinical trials conducted in China and pursuant to the
relevant regulatory requirements, only drug products with the drug substance produced by the same
manufacturer tested in clinical trials could be allowed for sale upon the BLA approval.
Considering our cash position, the substantial upcoming financial obligation, the unpredictable and
challenging nature of fundraising environment as well as the time and expense involved in seeking a
separate BLA for the Core Product with drug substance from the CDMO B, we determined that
cancelling the Reserved Drug Substance to be produced by the CDMO B was necessary and in the best
interest of our company. In February 2023, we exercised the right to cancel the commitment to purchase
the Reserved Drug Substance under the Commitment and Pre-payment Agreement. As such, we shall
compensate Ascendis Pharma for its losses pursuant to the relevant agreement, provided that Ascendis
Pharma shall use commercially reasonable efforts to mitigate the losses and that such losses are
evidenced by supporting documents and are detailed in the invoice. For the year ended December 31,
2023, we recorded a loss from a discontinued procurement contract in an amount of RMB109.0 million
in relation to the foregoing cancellation. For more details, see “Financial Information – Description of
Selected Components of Statements of Profit or Loss and Other Comprehensive Income – Other Gains
and Losses, Net.”
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Termination of the Land Use Right Transfer Agreement
Under our Initial Strategy where we planned to build our in-house manufacturing capabilities, we
entered into the Land Related Agreements with the Suzhou Industrial Park Planning and Construction
Committee in January 2022, pursuant to which we made payment of RMB9.2 million (including the land
deposit of RMB1.8 million) and acquired land use rights of approximately 25,000 square meters in
Suzhou. By committing to our Strategic Change, we believe we are able to realize local manufacturing
earlier by collaborating with a local CDMO while substantially reducing the initial capital investment.
As such, we exercised the termination right under the Land Use Right Transfer Agreement and submitted
an application of land return with relevant governmental authorities of Suzhou Industrial Park,
requesting the termination of the Land Related Agreements and returning of the land use rights to
Suzhou Industrial Park Administration Committee.
In relation to the land return, upon approval of land return by relevant governmental authorities, we may
incur a termination loss of approximately RMB1.8 million due to the non-refundable nature of the land
deposit, and after communication, we have been informed by the relevant governmental authorities that
land reclamation is needed to get the approval of land return. We entered into a construction agreement
with a vendor for land reclamation in July 2024, and completed substantive work as of December 2024
with cost of approximately RMB8.2 million incurred. We expect that we may incur an estimated total
cost of approximately RMB8.3 million in relation to the land reclamation. The results of land
reclamation will be subject to the review by relevant governmental authorities before their approval of
land return. As advised by our PRC Legal Adviser, the foregoing land return would not affect our legal
rights to apply for land use rights with governmental authorities in the future. For more details, see
“Risk Factors – Risks Related to Our Business Operations – We may in the future be subject to disputes,
legal proceedings or arbitration claims in the ordinary course of our business, and the court ruling or
arbitration award may not be favorable to us.”
With tightening global financial conditions amid uncertain outlook, we reasonably believe that we have
made proactive adaptation by canceling the lonapegsomatropin drug substance reserved under the
Commitment and Pre-payment Agreement and terminating the Land Use Right Transfer Agreement,
which we believe can yield benefits in excess of costs. Going forward, we will regularly assess risks and
vulnerabilities from various drivers of change, such as economic, environmental and societal factors to
implement proactive adjustment initiatives and prevent potential losses.
(2) Pre-PPQ lonapegsomatropin drug substance (“Pre-PPQ DS”) obtained pursuant to the Cost Sharing and
V olume Commitment Agreement
We intend to use the Pre-PPQ DS for both ongoing and future R&D endeavors, including but not limited
to that, (i) we have utilized the Pre-PPQ DS in our in-house development of the dual chamber device
(DCD) technology in the form of prefilled syringe as a drug delivery system for the lonapegsomatropin
drug substance, which included testing various process conditions and parameters to create a prototype
for the local manufacturing; and (ii) we will utilize the Pre-PPQ DS to test analytical methods ensuring
our capability to perform quality control on the locally manufactured drug product; and (iii) we will
utilized the Pre-PPQ DS as reference samples in comparability studies of the locally manufactured drug
substance. See “– Commercial Supply and Manufacturing – Step 2: Collaborative Local Manufacturing
with Local CDMO” for more details.
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COLLABORATIONS
Exclusive License Agreements with Ascendis Pharma
Background
In November 2018, we entered into three Exclusive License Agreements with Ascendis
Pharma relating to lonapegsomatropin, TransCon CNP (navepegritide) and palopegteriparatide,
respectively, which were subsequently amended in January 2021 due to the necessity to reflect
the evolving cooperation progress between the parties in terms of technology transfer and Joint
Commercialization Committee. Pursuant to the terms of each agreement, Ascendis Pharma
granted us an exclusive (including as to Ascendis Pharma), royalty-free license under its
applicable owned patents and other intellectual property for the purposes of developing,
manufacturing and commercializing the applicable drug candidates in endocrinology in China
(including Hong Kong, Macau and Taiwan). In addition, during the term of the Exclusive
License Agreements, Ascendis Pharma is required to notify us prior to engaging in substantive
discussions with a third party regarding the license to such third party by Ascendis Pharma or
its affiliates of rights to develop or commercialize endocrine drugs in China (including Hong
Kong, Macau and Taiwan) covered by the relevant Exclusive License Agreement, which we
will refer to as a ROFN Opportunity. If we inform Ascendis Pharma that we wish to negotiate
an agreement for such ROFN Opportunity, Ascendis Pharma and us shall enter into good faith
negotiations to finalize the relevant license agreement. We are not obligated to make any
royalty or milestone payments under the relevant Exclusive License Agreements, but have
instead issued to Ascendis Pharma an aggregate of 40,000,000 Series A Preferred Shares as
consideration for Ascendis Pharma to enter into these agreements. Ascendis Pharma is one of
our Founding Shareholders. See “History, Development and Corporate Structure – Major
Corporate Development and Shareholding Changes of Our Group” for more details. As a result
of this arrangement, Ascendis Pharma’s interests are closely aligned with ours both in terms of
bring endocrine drug candidates to patients in China (including Hong Kong, Macau and
Taiwan) and beyond as well as growing our Company for financial success. See “Relationship
with the Controlling Shareholders – Independence from Our Controlling Shareholders –
Operational and Administrative Independence – Remote Risk of Termination or any Material
Adverse Change of the Mutually Beneficial Relationship” for more details regarding the
benefits of this licensing arrangement in lieu of cash payment as consideration to Ascendis
Pharma.
Rights and Obligation
Each agreement obligates us to use diligent efforts to develop and commercialize
lonapegsomatropin, TransCon CNP (navepegritide) and palopegteriparatide, as applicable, in
China (including Hong Kong, Macau and Taiwan). We are solely responsible for any clinical
trial activities in China (including Hong Kong, Macau and Taiwan) for the foregoing licensed
product, and for obtaining regulatory approval for each licensed product in China (including
Hong Kong, Macau and Taiwan). We and Ascendis Pharma shall each conduct the R&D
activities as allocated to the respective party under the applicable research and technical
development plans, and we shall reimburse Ascendis Pharma for its costs incurred with respect
to its employees and approved service providers.
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Ascendis Pharma must provide product supply to us for use in conducting clinical trials
in China (including Hong Kong, Macau and Taiwan) pursuant to separate Clinical Supply
Agreements entered into concurrently with each Exclusive License Agreement. Additionally,
we and Ascendis Pharma will negotiate in good faith the terms and conditions governing the
commercial supply of each licensed product to us.
Under each Exclusive License Agreement, Ascendis Pharma, as the licensor, agreed not
to, directly or through third parties, research, develop, manufacture or commercialize
applicable competing products in China (including Hong Kong, Macau and Taiwan),
specifically, long-acting products or product candidates that are being developed and/or
commercialized for use in all human indications (excluding diabetes (and certain related
metabolic disorders), obesity and ophthalmology) that contains a hGH, CNP or PTH, as the
case may be. We, as licensee under the Exclusive License Agreements, agreed not to use or
exploit the patents and technical information (such as know-hows, discoveries, techniques)
controlled by Ascendis Pharma unless expressly permitted under the licenses granted to us, and
not to grant any license to third parties our interest in any inventions or intellectual property
arising out of the activities conducted under the Exclusive License Agreements (i) outside
China (including Hong Kong, Macau and Taiwan) for the development and/or
commercialization of any product for use in the treatment of endocrinology disorders; and (ii)
relating to Ascendis Pharma’s platform technology (including Ascendis Pharma’s proprietary
chemistry, materials and methodologies for transiently covalently coupling a substrate of
interest to various carriers via a transient conjugation linker, thereby allowing release of the
transiently linked substrate in a controlled manner over time for a therapeutic or prophylactic
effect) outside China (including Hong Kong, Macau and Taiwan) for any purpose (collectively,
the “Licensee Restricted Activities”).
We and Ascendis Pharma will each solely own inventions and related intellectual property
resulting from activities we each solely conduct pursuant to each agreement, and will jointly
own any inventions and related intellectual property developed jointly. After the first
regulatory approval of the licensed products in China (including Hong Kong, Macau and
Taiwan), if requested by us, Ascendis Pharma shall transfer to us (or one or more sublicensed
affiliates designated by us) the licensed product patents in China (including Hong Kong, Macau
and Taiwan) in accordance with each Exclusive License Agreement at no additional cost,
subject to our Shareholders’ approval in accordance with our Amended and Restated
Shareholders Agreement, if applicable. To facilitate our commercialization of the relevant drug
candidates, once approved, we currently expect to require Ascendis Pharma to transfer such
licensed product patents to us in China upon obtaining the relevant regulatory approval. We
granted Ascendis Pharma a non-exclusive, royalty-free, fully-paid, perpetual, irrevocable
license under our rights in any such inventions to develop and commercialize products outside
of China (including Hong Kong, Macau and Taiwan), which Ascendis Pharma has the right to
convert such non-exclusive license to an exclusive license on terms to be negotiated between
the parties in good faith. Subject to Ascendis Pharma transferring to us the licensed patents
after the regulatory approval of the licensed products in China (including Hong Kong, Macau
and Taiwan) if requested by us where we would have the first right to prosecute the licensed
patents, Ascendis Pharma has the first right to prosecute the licensed patents. We have first
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right to enforce the licensed patents in China (including Hong Kong, Macau and Taiwan)
within our licensed field, and Ascendis Pharma has such right in the rest of the world or in
China (including Hong Kong, Macau and Taiwan) outside of our licensed field.
Each Exclusive License Agreement continues to be in effect for as long as a valid claim
of an applicable licensed patent exists in China (including Hong Kong, Macau and Taiwan).
The current valid claim of the applicable licensed patent is projected to expire in 2035, 2040
and 2037, respectively, for lonapegsomatropin, TransCon CNP (navepegritide) and
palopegteriparatide. The valid term of applicable licensed patent is expected to further extend
upon the approval of the currently pending patent applications and future new patent
applications in relation to the licensed product. See “– Intellectual Property” for more details.
We may terminate each Exclusive License Agreement for convenience upon 90 days’ prior
written notice to Ascendis Pharma or by notice to Ascendis Pharma upon bankruptcy or
insolvency-related events involving Ascendis Pharma that have continued for 60 days
undismissed, unbonded and undischarged. Additionally, in the event that Ascendis Pharma
commits a material breach of any of the terms of each Exclusive License Agreement on its part
to be performed or observed, we shall have the right to terminate such agreement, in whole or
in part, by giving 60 days’ written notice to Ascendis Pharma, unless such material breach is
cured within the notice period.
On the other hand, in the event that we commit a material breach of our material
obligations under each Exclusive License Agreement (including the conduct of Licensee
Restricted Activities as discussed above, the failure to reimburse Ascendis Pharma for its costs
incurred in connection with the R&D activities) and such material breach causes material loss
by Ascendis that exceeds US$20 million, Ascendis Pharma shall have the right to terminate
such agreement, in whole or in part, by giving 90 days’ written notice to us, unless such
material breach is cured within the notice period or the loss to Ascendis Pharma is reduced
below an agreed money threshold. Further, Ascendis Pharma may terminate an Exclusive
License Agreement upon 30 days’ notice if we participate in a challenge of any of the patents
licensed to us under such agreement, and upon bankruptcy or insolvency-related events
involving us that have continued for 60 days undismissed, unbonded and undischarged.
Ascendis Pharma may also terminate the relevant Exclusive License Agreement(s) upon
immediate written notice to us, if we undergo a change of control in favor of (i) pharmaceutical
or biotechnology companies commercializing long-acting products that compete with
lonapegsomatropin, palopegteriparatide or TransCon CNP (navepegritide), as applicable,
within and outside of China (including Hong Kong, Macau and Taiwan) as of the date of such
change of control, or (ii) in the case of lonapegsomatropin, specified large players in the
pharmaceutical industry to the extent they are conducting clinical development and/or
commercialization of a long-acting product that compete with lonapegsomatropin.
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Dispute Resolution
Dispute, controversy or claim related to matters over the material aspects of the
development of the Licensed Products shall be resolved by the Joint Development Committee
(JDC) by unanimous vote, with each Ascendis Subsidiaries and the Company having one vote.
If after reasonable discussion and consideration of each of the parties’ views on a particular
matter before the JDC, the JDC is unable to reach a decision by unanimous vote on that matter,
then the Company shall have final decision-making authority, provided such unilateral
decision, among other things, will not materially impair any rights or assets of Ascendis
Subsidiaries and results in a material expansion of activities allocated to Ascendis Subsidiaries.
Dispute, controversy or claim related to matters over the material aspects of the
commercialization of the Licensed Products shall be resolved by the Joint Commercialization
Committee (JCC) by unanimous vote, with each Ascendis Subsidiaries and the Company
having one vote. If after reasonable discussion and consideration of each of the parties’ views
on a particular matter before the JCC, the JCC is unable to reach a decision by unanimous vote
on that matter, then the disputed matter shall be escalated to a discussion between the chief
executive officers of each of the parties. If such discussions are terminated without a
settlement, then the Company shall have final decision-making authority acting in good faith,
provided such unilateral decision, among other things, will not have a negative effect on the
development, manufacture or commercialization of the Licensed Products by Ascendis
Subsidiaries outside China (including Hong Kong, Macau and Taiwan).
In the event of any controversy, claim or other dispute arising out of or relating to
compliance with the Exclusive License Agreements, or the validity, breach, termination or
interpretation of the Exclusive License Agreements, such dispute shall be first referred to the
chief executive officers of the parties for resolution. In the event that the chief executive
officers cannot resolve such dispute within thirty (30) days of the receipt of such written notice,
either party may initiate the binding arbitration conducted under the auspices of the
International Chamber of Commerce accordance with the then prevailing Rules of Arbitration
of the International Chamber of Commerce in San Francisco, California, applying the
substantive law of the state of Delaware, USA, without reference to its conflict of laws
principles, and shall not be governed by the United Nations Convention of International
Contracts on the Sale of Goods (the Vienna Convention). Other contractual arrangements
between the Company and Ascendis Subsidiaries including Cost Sharing and V olume
Commitment Agreement, Commitment and Pre-Payment Agreement, and Commercial Supply
Agreement apply for the same aforementioned dispute resolution mechanism.
Notwithstanding above, any dispute that involves the validity, infringement or claim
interpretation of a patent that is issued: (a) in the United States shall be subject to actions
before the United States Patent and Trademark Office and/or submitted exclusively to the
federal court located in the jurisdiction of the district where any of the defendants resides; and
(b) in any other country shall be brought before an appropriate regulatory or administrative
body or court in that country.
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Further Letter Agreement in relation to China Phase 2 trial
In August 2021, without compromising our exclusive rights and responsibilities for the
development and commercialization regarding TransCon CNP (navepegritide) in China
(including Hong Kong, Macau and Taiwan), we entered into a letter agreement with Ascendis
Pharma to specify the roles and responsibilities between both parties in anticipation of the
upcoming China Phase 2 trial. Pursuant to this letter agreement, the two companies will jointly
conduct the China Phase 2 trial, with Ascendis Pharma acting as trial sponsor and us acting as
the exclusive authorized agent. In November 2022, the two companies entered into an
amendment to this letter agreement, under which we became the sole sponsor for the OLE
period of the China Phase 2 trial to reflect the updated roles and responsibilities between both
parties as the sponsorship for the OLE period of China Phase 2 trial was transferred from
Ascendis Pharma to us (the letter agreement and the subsequent amendment, collectively
referred to as the “Letter Agreement”). Pursuant to the Letter Agreement, we and Ascendis
Pharma shall reasonably cooperate and coordinate with each other in the conduct of the China
Phase 2 trial. We and Ascendis Pharma shall establish a joint task force comprised of an equal
representative functions from each party and the joint task force shall meet regularly to discuss
the strategy and review the progress of the China Phase 2 trial. We and Ascendis Pharma shall
be responsible for the portion of the costs incurred in connection with the conduct of the China
Phase 2 trial based on the allocation as set forth in the Letter Agreement, and among others,
Ascendis Pharma shall be responsible for the costs for investigational medicinal products,
while we will reimburse Ascendis Subsidiaries for the packing, labeling and shipment to China.
Subsequent to the entry of the foregoing amendment, we became the sole sponsor for the OLE
portion of the China Phase 2 trial as it commenced in January 2023.
Strategic Cooperation with China Alliance on Rare Diseases on A National Patient
Registry and Diagnosis Consensus of ACH in China
We supported the founding of Achondroplasia Advisory Board in June 2019 under the
governance of CHARD, a national, non-profit, cooperative exchange platform for rare diseases
by entering into a donation agreement with CHARD. Pursuant to the donation agreement, the
funds we donated shall be managed under the CHARD’s Rare Disease Management Special
Fund and used for pre-determined purposes, which primarily include the training of medical
personnel related to rare diseases, academic conferences, expert lectures, promotion of rare
disease registration systems, rare diseases related healthcare education, CHARD’s operational
expenses and other related purposes. The specific use of the funds shall be jointly negotiated
between CHARD and us annually. CHARD is responsible for supporting the operation of the
Achondroplasia Advisory Board and all operational expenses shall be funded by the Rare
Disease Management Special Fund.
In December 2020, we entered into a five-year strategy cooperation with CHARD on a
national patient registry and diagnosis consensus of ACH in China, the ApproaCH project,
under a funding agreement dated December 2020 between us and CHARD (the “ApproaCH
Agreement”). Under the ApproaCH project, a national patient registry study, the ApproaCH
Registry Study, was initiated in April 2021 and achieved the first wave screening and
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enrollment in October 2021, which has reached a total enrollment number of 480 patients and
completed 214 first-year, 100 second-year and 59 third-year follow-ups as of December 31,
2024. According to the ApproaCH agreement, we provided funding for the ApproaCH Registry
Study, with the purpose of assessing the growth and development indicators, natural disease
processes and the complications associated with ACH patients, as well as evaluating their
quality of life and the economic burden of ACH patients, by analyzing epidemiological
information of registered ACH patients in China. The goal of the ApproaCH Registry Study is
to establish a Chinese ACH patient cohort and establish ACH data platform or system to further
understand the natural history and current standard of care, and publish study reports and
papers. CHARD is responsible for the preparation, planning and implementation of the
ApproaCH Registry Study, including arranging researcher consultation from time to time,
research conferences, and working with CHARD’s ACH experts and 17 hospitals across the
country during the implementation of the project. CHARD is also responsible for designing and
developing study protocol, establishing and managing the ACH database and ensuring the
compliance of the data collection. CHARD owns the rights to the original data from the ACH
patient cohort and the economic burden study. CHARD is the sole owner of all data, study
results and intellectual property rights generated by the ApproaCH project and we shall not use
the intellectual property rights generated by the project without the written consent of CHARD.
Research data shall not be made public and research paper based on the ApproaCH project shall
not be published without the written consent of CHARD.
Strategic Cooperation with Peking University Health Science Center on A Cohort Study
on HP
In July 2021, we entered into a strategic cooperation agreement with Peking University
Health Science Center to initiate the PaTHway R study, the first registry study for HP patients
in China and one of the largest epidemiological surveys for this disease worldwide. The
PaTHway R study aims to enhance the understanding among the public and professionals
regarding the etiology, treatment options, disease burdens of HP and was kicked off in January
2022. Pursuant to the strategic cooperation agreement, the Peking University Health Science
Center is responsible for study protocol design, project management and execution, data
management, statistical analysis, etc. The study protocol shall be approved by the project
expert committee, and patient data shall be collected from 500 patients with HP from eight
regions across China enrolled to the study according to the study protocol. The study shall be
carried out in accordance with the study protocol and the standard operating procedures and
will be audited by us, to support a final research report. The Peking University Health Science
Center shall ensure that the research project is compliant with the laws and regulations and
shall be responsible for obtaining the necessary approvals from the relevant regulatory
authorities and conducting necessary filings. We are responsible for providing support for
funding, supervision and management, and should assist in identifying clear and defined
research objectives, research background information and the first draft of study protocol. The
Peking University Health Science Center is the owner of all intellectual properties associated
with the project, but will provide and license the desensitized data generated from the project
to us for our product research, development and other commercial use.
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Key Arrangements in relation to Our Local Manufacturing Capabilities for the Core
Product
In July 2023, we entered into a Technology Transfer Master Plan of the Core Product with
Ascendis Pharma, which has marked the commencement of the Technology Transfer with
respect to the manufacturing of the Core Product from Ascendis Pharma to us and sets forth
the obligations of both parties under the Exclusive License Agreement with respect to the
Technology Transfer. On December 18, 2023, we entered into a collaboration agreement with
WuXi Biologics, our designated local CDMO, to strengthen our commercialization capabilities
and establish localized manufacturing capabilities to secure the supply of our Core Product.
Pursuant to such agreement, WuXi Biologics will be involved in the Technology Transfer and
Localization as the local CDMO of manufacturing technology, and we will entrust WuXi
Biologics with the local commercial supply of lonapegsomatropin drug substance. WuXi
Biologics will leverage its technologies and expertise to provide us with efficient and
cost-effective local manufacturing solutions for the Core Product. Completion of the
Technology Transfer and Localization, which is expected to be in 2027, will confer to us the
technical capabilities to manufacture the Core Product drug substance in collaboration with
WuXi Biologics. The commercialization of the Core Product manufactured by WuXi Biologics
will start once we obtain the approval of Local BLA, which is expected to occur in 2028.
Entry into Strategic Collaboration Agreement with Shanghai Pharmaceutical
On October 30, 2023, to advance the expected commercialization of our Core Product and
other products, we entered into a strategic collaboration agreement with Shanghai
Pharmaceutical. Pursuant to such agreement, Shanghai Pharmaceutical will leverage its
expertise and capabilities to assist us to establish the necessary management framework in line
with the GSP .
BUSINESS DEVELOPMENT
We will continue to select, develop, and market paradigm-shifting therapeutic drugs that
have the potential to fulfill current unmet medical needs. We aim to bridge global innovation
to bring endocrine therapies to Chinese patients, and plan to become the partner of choice in
endocrinology for China (including Hong Kong, Macau and Taiwan). Thus far, we have a
proven track record of collaborating with Ascendis Pharma, which underscores our credibility
with global biopharmaceutical and biotechnology companies and paves the way for long-term
collaborations. We intend to expand our pipeline portfolio through strategic in-licensing,
collaborations and partnerships with Ascendis Pharma and other biopharmaceutical companies.
Under the Exclusive License Agreements with Ascendis Pharma, we hold a right of first
negotiation on certain future Ascendis Pharma products within the endocrine disease area for
China (including Hong Kong, Macau and Taiwan). This will enable us to source, develop and
commercialize additional drug candidates that are based on the unique transient conjugation
technology (TransCon) and have the potential to be highly differentiated endocrine therapies.
We plan to collaborate with Ascendis Pharma to evaluate future potential drug candidates and
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exercise our right for those products that address unmet medical needs and possess strong
commercial potential in China (including Hong Kong, Macau and Taiwan). See “–
Collaborations – Exclusive License Agreements with Ascendis Pharma” for more details.
Beyond Ascendis Pharma, we plan to leverage our platform and network to pursue
business development opportunities with other potential biopharmaceutical partners with
endocrine drugs, drug candidates or technologies and platforms that may be synergistic or
complementary to our portfolio and/or our capabilities. We believe our relationships with our
Shareholders and a group of strategic and life sciences focused Sophisticated Investors will
contribute to our success in building value-creating partnerships. In the long-term, we plan to
leverage our infrastructure in endocrinology to become the partner of choice for endocrine
treatment looking to enter China (including Hong Kong, Macau and Taiwan).
We plan to fully exploit our extensive knowledge in endocrinology and our deep
understanding of the medical need and technology, and through identifying and executing
attractive licensing and collaboration opportunities or through mergers and acquisitions, we
seek to pursue business development opportunities to further expand our portfolio with other
potential biopharmaceutical partners with endocrine drugs, drug candidates or technologies
that may be synergistic or complementary to our portfolio.
Our scaled operation and platform, integrated with a commercial team that targets the
same group of doctors and call points in the endocrinology specialty, is highly synergistic with
strong operating leverage to maximize the value of additional endocrine products looking to
enter China (including Hong Kong, Macau and Taiwan):
 Synergistic clinical stage products with potential. We prioritize bringing in drugs or
drug candidates based on their clinical profile, degree of novelty and validation,
technology differentiation, the unmet medical needs of the target disease and
respective commercial potential in China (including Hong Kong, Macau and
Taiwan).
 Marketed endocrine products with only light commercialization effort required and
attractive cashflow or margin. We are strategically seeking to in-license or acquire
rights to drugs that are either already launched or in late-stage development in
regulated markets such as the United States and the European Union that may be
synergistic or complementary to our portfolio.
As a complementary measure, we will opportunistically look to establish internally
developed pipeline of promising therapies, with local CDMO support or through mergers and
acquisitions of research-driven biotech companies, when the products’ target or MoA fit with
our overall product offering suite and target large market opportunities.
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EMPLOYEES
As of the Latest Practicable Date, we employed a total of 52 full-time employees, all
based in China, including a total of 15 employees with a Ph.D. degree or an M.D. degree. The
following table sets forth a breakdown of our employees by function as of the Latest
Practicable Date:
Function Number % of Total
Clinical R&D 16 31
Manufacturing (including manufacturing
related R&D) 8 15
Commercialization (including Medical Affairs) 10 19
Others 18 35
Total 52 100
Employee Agreements with Key Management and Research Staff
We enter into standard confidentiality and employment agreements with our key
management and research staff. The contracts with our key personnel typically include a
standard non-compete agreement that prohibits the employee from competing with us, directly
or indirectly, during his or her employment and for two years after the termination of his or her
employment. The contracts also typically include undertakings regarding assignment of
inventions and discoveries made during the course of his or her employment. See “Directors
and Senior Management” for further details regarding the terms of confidentiality and
employment agreements with our key management.
As of the Latest Practicable Date, neither our Company nor any of our subsidiaries have
any labor union. We believe that we maintain a good working relationship with our employees
and we have not experienced any significant labor disputes or any significant difficulty in
recruiting staff for our operations.
Recruitment, Training and Development
We recruit our employees based on their qualifications and potential. We provide new
employee training to our employees and periodic on-the-job training to enhance the skills and
knowledge of our employees.
Employee Benefits
The remuneration package of our employees includes salary, benefits, bonus and
incentive share options. Our compensation programs are designed to remunerate our employees
based on their performance, measured against specified objective criteria. As required by laws
and regulations in China, we participate in various employee social security plans that are
organized by municipal and provincial governments, including housing, pension, medical
insurance and unemployment insurance. We are required under PRC law to make contributions
to employee benefit plans at specified percentages of the salaries, bonuses and certain
allowances of our employees, up to a maximum amount specified by the local government from
time to time.
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INTELLECTUAL PROPERTY
We own the intellectual property rights to exclusively develop, manufacture, and
commercialize our Core Product and other drug candidates in China (including Hong Kong,
Macau and Taiwan). We were granted an exclusive and royalty-free license (with the right to
grant sub-licenses) under the Exclusive License Agreements to develop, manufacture (i.e., any
manufacturing activity of the licensed products, or ingredients thereof, including
manufacturing for pre-clinical or clinical use, or commercial sale, testing, handling, packaging
and storage, ongoing stability tests and regulatory activities related to any of the foregoing),
have made, use, sell, offer for sale, import, export or otherwise commercialize our pipeline
drug candidates in endocrinology in China (including Hong Kong, Macau and Taiwan). Our
commercial success depends in part on our ability to obtain and maintain proprietary or
intellectual property protection for our drug candidates and our core technologies and other
know-how and to operate without infringing, misappropriating or otherwise violating the
proprietary and intellectual rights of others and to prevent others from infringing,
misappropriating or otherwise violating our proprietary or intellectual property rights. To
protect our proprietary and intellectual property position, we have gained exclusive licensed
rights in Mainland China, Hong Kong, Macau and Taiwan to issued patents and patent
applications related to our drug candidates that are important to the development and
implementation of our business. We also rely on trade secrets, know-how and continuing
technological innovation to develop and maintain our proprietary and intellectual property
position, which we generally seek to protect through contractual obligations with third parties.
We were not involved in any intellectual property infringement claims or proceedings during
the Track Record Period and up to the Latest Practicable Date.
As of the date of this prospectus, we have exclusively licensed from Ascendis Pharma 51
issued patents in China (including Hong Kong, Macau and Taiwan), and 61 pending patent
applications in China (including Hong Kong, Macau and Taiwan). In addition, as of the date
of this prospectus, we hold two pending patent applications in sole ownership relating to
lonapegsomatropin, and two issued patents and nine pending patent applications in joint
ownership in the PRC in relation to our development of container closure system. Our patent
and patent application portfolio includes the following:
Lonapegsomatropin . We have exclusively licensed from Ascendis Pharma nine issued
patents and six patent applications in China (including Hong Kong, Macau and Taiwan) and
currently hold two patent applications in sole ownership in the PRC relating to
lonapegsomatropin. The issued patents are projected to expire in 2037.
TransCon CNP (navepegritide) . We have exclusively licensed from Ascendis Pharma 17
issued patents and 17 patent applications in China (including Hong Kong, Macau and Taiwan)
relating to TransCon CNP (navepegritide). The issued patents are projected to expire in 2040.
Palopegteriparatide . We have exclusively licensed from Ascendis Pharma 16 issued
patents and 26 patent applications in China (including Hong Kong, Macau and Taiwan) relating
to palopegteriparatide. The issued patents are projected to expire in 2037.
BUSINESS
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Auto-Injector . We have exclusively licensed from Ascendis Pharma 10 issued patents and
12 patent applications in China (including Hong Kong, Macau and Taiwan) relating to the
auto-injector. The issued patents are projected to expire in 2038.
Container closure system . We currently hold two issued patents and nine patent
applications relating to the container closure system in the PRC in joint ownership. The issued
patents are projected to expire in 2034.
The table below sets forth an overview of material granted patents in connection with our
drug candidate as of the date of this prospectus. See “Appendix IV – Statutory and General
Information – B. Further Information about Our Business” for further details.
Patent Application/
Publication Number Scope of Protection Jurisdiction Applicant Application Date Status Expiration date Rights of the Company
Lonapegsomatropin
CN102014965B PEGylated recombinant
human growth hormone
compounds
CN Ascendis Pharma
Endocrinology
Division
April 29, 2009 Granted April 29, 2029 The Company was
granted by the
Applicant an exclusive,
royalty-free licence
(with the right to grant
sub-licences) under this
patent to develop,
manufacture, have
made, use, sell, offer
for sale, import, export
or otherwise
commercialize licensed
product in the
treatment and/or
prevention of any
disease, condition or
disorder of any human
indication, excluding
the excluded
indications in the PRC,
including Hong Kong,
Macau and Taiwan.
CN102989001B hGH prodrugs CN Ascendis Pharma
Endocrinology
Division
April 29, 2009 Granted April 29, 2029
HK1179899B hGH prodrugs HK Ascendis Pharma
Endocrinology
Division
April 29, 2009 Granted April 29, 2029
HK1240819B Polymeric human growth
hormone prodrug
HK Ascendis Pharma
Endocrinology
Division
November 17,
2015
Granted November 17, 2035
HK1152239B Growth Hormone (rhGH) HK Ascendis Pharma
Endocrinology
Division
April 29, 2009 Granted April 29, 2029
HK1244227B Pharmaceutical
formulation comprising
a long-acting growth
hormone
HK Ascendis Pharma
Endocrinology
Division
November 20,
2015
Granted November 20, 2035
HK1227482B PEGylated recombinant
human growth hormone
compounds
HK Ascendis Pharma
Endocrinology
Division
April 29, 2009 Granted April 29, 2029
HK40026920C Novel polymeric hGH
prodrugs
HK Ascendis Pharma
Endocrinology
Division
November 17,
2015
Granted November 17, 2035
HK40011764B Combination therapy HK Ascendis Pharma
Growth Disorders
September 28,
2017
Granted September 28, 2037
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Patent Application/
Publication Number Scope of Protection Jurisdiction Applicant Application Date Status Expiration date Rights of the Company
TransCon CNP
(navepegritide)
CN107405409B CNP prodrug or
pharmaceutically
acceptable salts thereof
CN Ascendis Pharma
Growth Disorders
January 8, 2016 Granted January 8, 2036 The Company was
granted by the
Applicant an exclusive,
royalty-free licence
(with the right to grant
sub-licences) under this
patent to develop,
manufacture, have
made, use, sell, offer
for sale, import, export
or otherwise
commercialize licensed
product in the
treatment and/or
prevention of any
disease, condition or
disorder of any human
indication, excluding
the excluded
indications in the PRC,
including Hong Kong,
Macau and Taiwan.
HK1246666B CNP prodrug or
pharmaceutically
acceptable salts thereof
HK Ascendis Pharma
Growth Disorders
January 8, 2016 Granted January 8, 2036
CN108472380B Controlled-release CNP
agonist
CN Ascendis Pharma
Growth Disorders
January 5, 2017 Granted January 5, 2037
CN114306629B
(Divisional patent of the
CN108472380B)
Controlled-release CNP
agonist
CN Ascendis Pharma
Growth Disorders
January 5, 2017 Granted January 5, 2037
HK40069215B Controlled-release CNP
agonist
HK Ascendis Pharma
Growth Disorders
January 5, 2017 Granted January 5, 2037
J/7651 Controlled-release CNP
agonist
Macau Ascendis Pharma
Growth Disorders
January 5, 2017 Granted January 5, 2037
HK1259384B Controlled-release CNP
agonist
HK Ascendis Pharma
Growth Disorders
January 5, 2017 Granted January 5, 2037
CN108472383B Controlled-release CNP
agonists with low
NPR-C binding
CN Ascendis Pharma
Growth Disorders
January 5, 2017 Granted January 5, 2037
HK1257769B Controlled-release CNP
agonists with low
NPR-C binding
HK Ascendis Pharma
Growth Disorders
January 5, 2017 Granted January 5, 2037
J/6504 Controlled-release CNP
agonists with low
NPR-C binding
Macau Ascendis Pharma
Growth Disorders
January 5, 2017 Granted January 5, 2037
CN109843295B CNP combination therapy CN Ascendis Pharma
Growth Disorders
September 28,
2017
Granted September 28, 2037
HK40008972B CNP combination therapy HK Ascendis Pharma
Growth Disorders
September 28,
2017
Granted September 28, 2037
CN113423384B
(2020800134620)
Pharmaceutical
formulation comprises
a CNP conjugate
CN Ascendis Pharma
Growth Disorders
February 10, 2020 Granted February 10, 2040
HK40052552B Dry pharmaceutical
formulations of CNP
conjugates
HK Ascendis Pharma
Growth Disorders
February 10, 2020 Granted February 10, 2040
HK1262548B CNP prodrugs HK Ascendis Pharma
Growth Disorders
January 5, 2017 Granted January 5, 2037
J/7895 Dry Pharmaceutical
Formulations of CNP
conjugates
Macau Ascendis Pharma
Growth Disorders
February 10, 2020 Granted February 10, 2040
HK40011764B Combination therapy HK Ascendis Pharma
Growth Disorders
September 28,
2017
Granted September 28, 2037
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Patent Application/
Publication Number Scope of Protection Jurisdiction Applicant Application Date Status Expiration date Rights of the Company
Palopegteriparatide
CN101980725B A prodrug comprising
drug linker conjugate
D-L or a
pharmaceutically
acceptable salt thereof
CN Ascendis Pharma A/S January 30, 2009 Granted January 30, 2029 The Company was
granted by the
Applicant an exclusive,
royalty-free licence
(with the right to grant
sub-licences) under this
patent to develop,
manufacture, have
made, use, sell, offer
for sale, import, export
or otherwise
commercialize licensed
product in the
treatment and/or
prevention of any
disease, condition or
disorder of any human
indication, excluding
the excluded
indications in the PRC,
including Hong Kong,
Macau and Taiwan.
HK1152240B A prodrug comprising
drug linker conjugate
D-L or a
pharmaceutically
acceptable salt thereof
HK Ascendis Pharma A/S January 30, 2009 Granted January 30, 2029
CN109069659B PTH prodrugs CN Ascendis Pharma
Bone Diseases
February 28, 2017 Granted February 28, 2037
HK40000751B PTH prodrugs HK Ascendis Pharma
Bone Diseases
February 28, 2017 Granted February 28, 2037
J/6258 PTH prodrugs Macau Ascendis Pharma
Bone Diseases
February 28, 2017 Granted February 28, 2037
CN109789221B Pharmaceutical
composition
CN Ascendis Pharma
Bone Diseases
September 28,
2017
Granted September 28, 2037
HK40007777B Pharmaceutical
composition
HK Ascendis Pharma
Bone Diseases
September 28,
2017
Granted September 28, 2037
CN109789188B PTH compounds with
low peak-to-trough
ratios
CN Ascendis Pharma
Bone Diseases
September 28,
2017
Granted September 28, 2037
HK40007965B PTH compounds with
low peak-to-trough
ratios
HK Ascendis Pharma
Bone Diseases
September 28,
2017
Granted September 28, 2037
CN109789189B (Just
received Notice of
Allowance)
Controlled release
compounds
CN Ascendis Pharma
Bone Diseases
September 28,
2017
Granted September 28, 2037
HK40007776B Dosage regimen for a
controlled-release PTH
compound
HK Ascendis Pharma
Bone Diseases
September 28,
2017
Granted September 28, 2037
HK40011848B Controlled release
compounds
HK Ascendis Pharma
Bone Diseases
September 28,
2017
Granted September 28, 2037
HK1263064B PTH prodrug HK Ascendis Pharma
Bone Diseases
February 28, 2017 Granted February 28, 2037
J/6797 A pharmaceutical
composition
comprising a
controlled-release PTH
compound
Macau Ascendis Pharma
Bone Diseases
September 28,
2017
Granted September 28, 2037
J/7897 Dosage regimen for a
controlled-release PTH
compound
Macau Ascendis Pharma
Bone Diseases
September 28,
2017
Granted September 28, 2037
HK40011765B PTH Compound HK Ascendis Pharma
Bone Diseases
September 28,
2017
Granted September 28, 2037
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Patent Application/
Publication Number Scope of Protection Jurisdiction Applicant Application Date Status Expiration date Rights of the Company
Auto-Injector
CN110769873B Autoinjector CN Ascendis Pharma A/S May 23, 2018 Granted May 23, 2038 The Company was
granted by the
Applicant an exclusive,
royalty-free licence
(with the right to grant
sub-licences) under this
patent to develop,
manufacture, have
made, use, sell, offer
for sale, import, export
or otherwise
commercialize licensed
product in the
treatment and/or
prevention of any
disease, condition or
disorder of any human
indication, excluding
the excluded
indications in the PRC,
including Hong Kong,
Macau and Taiwan.
CN115154759B Autoinjector CN Ascendis Pharma A/S June 29, 2018 Granted June 29, 2038
CN110809484B Autoinjector CN Ascendis Pharma A/S June 29, 2018 Granted June 29, 2038
HK1262144B Autoinjector CN Ascendis Pharma A/S December 29,
2016
Granted December 29, 2036
HK40016523B Autoinjector HK Ascendis Pharma A/S June 29, 2018 Granted June 29, 2038
HK40074077B Autoinjector HK Ascendis Pharma A/S June 29, 2018 Granted June 29, 2038
HK1262145B Autoinjector HK Ascendis Pharma A/S December 29,
2016
Granted December 29, 2036
HK40016524B Autoinjector HK Ascendis Pharma A/S May 23, 2018 Granted May 23, 2038
HK1262200B Autoinjector HK Ascendis Pharma A/S December 29,
2016
Granted December 29, 2036
HK1262198B Autoinjector HK Ascendis Pharma A/S December 29,
2016
Granted December 29, 2036
Container Closure System
CN222062820U Combined cap and
dual-chamber
cartridge bottle
CN V endor A; VISEN
Shanghai
April 24, 2024 Granted April 24, 2034 Joint Ownership
CN220975146U Cap and dual-chamber
cartridge bottle
CN V endor A; VISEN
Shanghai
October 11, 2023 Granted October 11, 2033
Pursuant to the Exclusive License Agreements, upon the first regulatory approval of a
licensed product in endocrinology in China (including Hong Kong, Macau and Taiwan), we are
entitled to request Ascendis Pharma to transfer the ownership of the patents in relation to the
corresponding licensed products in China (including Hong Kong, Macau and Taiwan) to us,
without incurring additional costs. As such, we shall, at our own expense and in our sole
discretion, have the first right to file, prosecute, maintain and defend such patents. We intend
to exercise such option to request Ascendis Pharma to transfer the ownership of the patents in
relation to the Core Product upon obtaining the expected BLA approval in the second half of
2025. See “Appendix IV – Statutory and General Information – B. Further Information about
Our Business – 2. Intellectual Property Rights of Our Group” for details of the licensed product
patents in China (including Hong Kong, Macau and Taiwan) which we expect to request
BUSINESS
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Ascendis Pharma to transfer to us. Even without such ownership transfer, we will still maintain
an effective control over the patent rights of the Licensed Products in China (including Hong
Kong, Macau and Taiwan) with an exclusive license under the Exclusive License Agreements
which enable us to develop, manufacture, have made, use, sell, offer for sale, import, export
or otherwise commercialize our pipeline drug candidates in endocrinology in China (including
Hong Kong, Macau and Taiwan). Therefore, we believe any failure to obtain ownership of
relevant patents from Ascendis Pharma will not directly hamper our business, financial
conditions or results of operations. We currently do not own or have any exclusive license to
any patents or patent applications in any jurisdictions outside of China (including Hong Kong,
Macau and Taiwan) for lonapegsomatropin, TransCon CNP (navepegritide), and
palopegteriparatide. See “– Collaborations – Exclusive License Agreements with Ascendis
Pharma” for more details regarding our exclusive license arrangements with Ascendis Pharma.
We performed due diligence on Ascendis Pharma’s intellectual property rights before
entering into the license agreements with them, but we cannot guarantee that such rights will
not be challenged or that they will provide meaningful exclusivity or competitive advantage or
otherwise enable us to successfully exploit the licensed drug candidates. See “Risk Factors –
Key Risks Related to Our Business, Business Operations, Intellectual Property, Regulatory
Approval of Our Drug Candidates, Commercialization and Financial Prospects – Our
in-licensed patents and patent applications or any patents and patent applications that we own
or in-license in the future may be subject to priority disputes or to inventorship disputes and
similar proceedings. If we or our licensors are unsuccessful in any of these proceedings, we
may be required to obtain licenses from third parties, which may not be available on
commercially reasonable terms or at all, or to cease the development, manufacture and
commercialization of one or more of our drug candidates.”
The term of a patent depends upon the laws of the country in which it is issued. Generally,
a patent term is 20 years from the earliest filing date of a non-provisional patent application.
Under the PRC Patent Law, the term of patent protection starts from the date of application.
Patents relating to inventions are effective for 20 years, and utility models are effective for 10
years and designs are effective for 15 years from the date of application. The patent
compensation system has been effective from June 1, 2021, which may benefit issued patents
in China. For patents relating to new drugs approved for marketing in the PRC, the patent term
may be extended upon request of the patent holder by up to five years as determined by the
competent patent authorities, in order to compensate for the time spent for drug marketing
registration and approval procedures, and with such compensation the patent term after the
relevant new drug marketing authorization is approved shall not exceed 14 years.
To mitigate the risks of patent expiration and obtain the necessary intellectual property
protection to support the development and commercialization of our drug candidates in China
(including Hong Kong, Macau and Taiwan), we will apply for patent term extension under
relevant patent laws and through the patent compensation system, once the relevant drug
candidates receive marketing approval in China. In addition to the issued patents, we have
rights to patent applications in China (including Hong Kong, Macau and Taiwan) for each of
our drug candidates. Such patent applications, if approved, will confer us additional patent
BUSINESS
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protections in relation to the applicable drug candidates. Further, under the Exclusive License
Agreements, we will own all right, title, and interest and to any and all patents that are
conceived or generated solely by the employees, agents or service providers of our Company
or affiliates. As such, we may perform and continue our research and development efforts and
take ownership of self-developed patents during and after the patent terms, thereby creating a
patent portfolio that offers sustainable patent protection in China (including Hong Kong,
Macau and Taiwan) all the way long. Even if patent term extensions and the patent
compensation system were not available for the issued patents, we can continue to develop,
manufacture and commercialize our drug candidates under the exclusive capacity conferred by
the patents to be issued from the currently pending patent applications and potential
self-developed patent applications. Further, under the Exclusive License Agreements, we also
control the technical information (i.e., any and all know-how, data, inventions, discoveries,
findings, methods, proprietary information, processes, techniques, materials and other
information and technology) required to develop, manufacture and commercialize our drug
candidates, and the licensed use of such technical information will remain effective as long as
the Exclusive License Agreements are not terminated.
We conduct our business mainly under the brand name of “VISEN Pharmaceuticals”
(ၪ؁ᖹุ). As of the Latest Practicable Date, we had 127 registered trademarks and four
pending trademark applications in China (including Hong Kong, Macau and Taiwan). We have
one domain name, which is www.visenpharma.com .
The table below sets forth the registered trademarks that we deemed material to our
business.
No. Trademark Owner Class
Place of
Registration Expiry Date
Registration
Number
1 VISEN VISEN Shanghai 35 PRC September 6,
2033
46448849
2 VISEN VISEN Shanghai 35 PRC April 13, 2032 50914244
3 VISEN VISEN Shanghai 5 PRC October 6,
2031
51329106
4 VISEN VISEN Shanghai 10 PRC February 6,
2032
58107493
5 ၪ؁VISEN Shanghai 10 PRC September 13,
2033
63503436
6 ၪ؁VISEN Shanghai 5 PRC October 27,
2032
54815389
7 ၪ؁VISEN Shanghai 35 PRC January 6,
2033
54827259
8 ၪ؁VISEN Shanghai 35 PRC May 20, 2032 54836276
9 ၪጲ৷ VISEN Shanghai 5 PRC January 27,
2032
58118622
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No. Trademark Owner Class
Place of
Registration Expiry Date
Registration
Number
10 ၪ؁അ VISEN Shanghai 10 PRC January 27,
2032
58120354
11 VISENPHM VISEN Shanghai 35 PRC August 6,
2029
35290153
12 VISENPHM VISEN Shanghai 5 PRC August 6,
2029
35301061
13 VISENMED VISEN Shanghai 5 PRC August 20,
2029
35440861
14 VISENMED VISEN Shanghai 35 PRC August 13,
2029
35444832
15
 VISEN Shanghai 10 PRC May 13, 2034 75054451
16
 VISEN Shanghai 5 PRC November 6,
2034
77141005
17 VISEN VISEN HK 5, 10
&3 5
HK July 27, 2031 305701509
18 ၪጲ৷ (Series) VISEN HK 5 HK July 27, 2031 305701383
19 ၪ؁Series) VISEN HK 5, 10
&3 5
HK July 27, 2031 305701491
20
 VISEN Shanghai 35 PRC February 13,
2035
58099506
21
 VISEN Shanghai 35 PRC February 13,
2035
58099518
See “Risk Factors – Other Risks Related to Our Intellectual Property” for other risks
related to our intellectual property, and “Appendix IV – Statutory and General Information –
B. Further Information about Our Business” for further details regarding our intellectual
property rights.
As advised by our legal advisor as to the intellectual property laws, with the support of
the freedom-to-operate searches and analysis on our Core Product and other drug candidates
in China (including Hong Kong, Macau and Taiwan), (a) no particular findings has caused or
casted doubt on our possession of sufficient rights under the Exclusive License Agreements
enabling us to manufacture, import, commercialize, use, or sell the Core Product and other drug
candidates in China (including Hong Kong, Macau and Taiwan); (b) no third-party issued
patents have been identified that would be infringed upon by us in relation to the
manufacturing, importation, commercialization, use, or sale of the Core Product and other drug
candidates in China (including Hong Kong, Macau and Taiwan); (c) Ascendis Pharma is the
registered owner of patents and patent applications for the Core Product and other drug
candidates in China (including Hong Kong, Macau and Taiwan); and (d) existing registered
patents have conferred sufficient protection to the Core Product and other drug candidates in
China (including Hong Kong, Macau and Taiwan), regardless of the pending status of patent
applications in relation to the Core Product and other drug candidates. Taking into account the
foregoing, our Directors believe, which is concurred by our legal advisor as to the intellectual
property laws, that we possess the essential patent rights and have sufficient intellectual
property protection in relation to the Core Product and other drug candidates in China
(including Hong Kong, Macau and Taiwan).
BUSINESS
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With the same basis set forth above and independent due diligence conducted by the Joint
Sponsors, nothing has come to the Joint Sponsors’ attention that would reasonably cause Joint
Sponsors to cast doubt on the Directors’ view.
PERMITS, LICENSES AND OTHER APPROV ALS
During the Track Record Period and as of the Latest Practicable Date, we had obtained
all requisite licenses, approvals and permits from relevant authorities that are material to
our operations. As of the Latest Practicable Date, all of our three drug candidates received
notice for approval of clinical trials (ࣣٝissued by the NMPA.
LEGAL PROCEEDINGS AND COMPLIANCE
Our Directors confirm that, as of the Latest Practicable Date, we were not a party to any
material legal or administrative proceedings in connection with intellectual property rights or
otherwise, and we are not aware of any claims or proceedings contemplated by Governmental
Authorities or third parties which could materially and adversely affect our business. In
addition, as of the Latest Practicable Date, other than those disclosed elsewhere in the
Directors and Senior Management, our Directors are not involved in any actual or threatened
material claims or litigation.
SUPPLIERS
Our major suppliers primarily provide us (i) the clinical supplies of our endocrine drug
candidates; (ii) operational services such as patient registry; (iii) certain research and
development services which we outsource to third-party CROs; and (iv) lessors of our leased
properties. We have established stable relationships with many of our key suppliers.
Purchases from our five largest suppliers, for 2022, 2023 and the nine months ended
September 30, 2024 were RMB87.4 million, RMB30.0 million and RMB22.4 million,
respectively, representing 53%, 45% and 54% of our total purchase cost for the respective
period. Purchases from our largest supplier for 2022, 2023 and the nine months ended
September 30, 2024 were RMB63.5 million, RMB17.7 million and RMB6.7 million,
respectively, representing 39%, 26% and 16% of our purchase cost for the respective period.
Save for Ascendis Pharma, all of our five largest suppliers during the Track Record Period
are Independent Third Parties, and none of our Directors, their respective associates nor any
Shareholder who, to the knowledge of our Directors, owned more than 5% of our issued share
capital as at the Latest Practicable Date, has any interest in any of our five largest suppliers
during the Track Record Period.
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In addition, we believe that adequate alternative sources for such supplies exist and we
have developed alternative sourcing strategies for these supplies. We will establish necessary
relationships with alternative sources based on supply continuity risk assessment. Other than
the agreements with certain CROs, we order supplies and services on a purchase order basis
and have set up CRO bidding and management processes to enable us to obtain better terms
and conditions.
The following table sets forth certain information of our five largest suppliers during the
Track Record Period:
Five largest
suppliers for
the nine months
ended
September 30,
2024 Supplier background Products/services purchased
Business
relationship
since
Typical
credit term
and payment
method
Purchase
amount
Percentage
of total
purchases
RMB’000
Ascendis Pharma
Endocrinology
Division A/S
A global pharmaceutical
Company headquartered in
Denmark focusing on
endocrinology rare diseases,
wholly owned by Ascendis
Pharma A/S
Clinical supply of the Core
Product, Clinical Consulting,
Cost Sharing for the Core
Product
2018 30-60 days,
wire
transfer
6,688 16%
Ascendis Pharma
Growth
Disorders A/S
A global pharmaceutical
Company headquartered in
Denmark focusing on
growth disorders diseases,
wholly owned by Ascendis
Pharma A/S
Clinical supply of TransCon
CNP (navepegritide),
Clinical Consulting
2018 30-60 days,
wire
transfer
6,253 15%
Supplier A A company providing
construction services
headquartered in Shanghai,
China. It has a registered
capital of RMB60 million
Construction unit relating to
Suzhou Industrial Park
2024 30 days, wire
transfer
4,433 11%
Ascendis Pharma
Bone Diseases
A/S
A global pharmaceutical
Company headquartered in
Denmark focusing on bone
diseases, wholly owned by
Ascendis Pharma A/S
Clinical supply of
palopegteriparatide, Clinical
Consulting
2018 30-60 days,
wire
transfer
3,408 8%
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Five largest
suppliers for
the nine months
ended
September 30,
2024 Supplier background Products/services purchased
Business
relationship
since
Typical
credit term
and payment
method
Purchase
amount
Percentage
of total
purchases
RMB’000
Supplier B A leading CRO headquartered
in Hangzhou, providing full-
service for the global
biopharmaceutical and
medical device industries. It
had revenue of
approximately RMB7,384.0
million and more than 9,500
employees in 2023
according to its annual
report
 Core Product: safety
evaluation, clinical trial
execution, and central
image, CSR preparation
 Palopegteriparatide: assist
us with data management,
safety information
collection and biostatic
analysis
 TransCon CNP
(navepegritide):
pharmacovigilance service
for safety evaluation
2019 60 days, wire
transfer
1,638 4%
Total 22,419 54%
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Five largest
suppliers for the
Y ear 2023 Supplier background Products/services purchased
Business
relationship
since
Typical
Credit Term
and Payment
Method
Purchase
amount
Percentage
of total
purchases
(RMB’000)
Ascendis Pharma
Endocrinology
Division A/S
A global pharmaceutical
Company headquartered in
Denmark focusing on
endocrinology rare diseases,
wholly owned by Ascendis
Pharma A/S
Clinical supply of the Core
Product, Clinical Consulting,
Cost Sharing for the Core
Product
2018 30-60 days,
wire
transfer
17,712 26%
Supplier C A company based in Shanghai,
China. Its business scope
includes property leasing,
property information
consulting, and corporate
investment. The company
provides services related to
the leasing of properties,
offering solutions for
individuals and businesses
in search of rental
properties. It has a
registered capital of
approximately US$100.9
million
Office lease relating to the
office in Shanghai
2021 N/A, wire
transfer
4,092 6%
Ascendis Pharma
Growth
Disorders A/S
A global pharmaceutical
Company headquartered in
Denmark focusing on
growth disorders diseases,
wholly owned by Ascendis
Pharma A/S
Clinical supply of TransCon
CNP (navepegritide),
Clinical Consulting
2018 30-60 days,
wire
transfer
3,301 5%
Supplier D A company engaged in the
development of real estate
properties. The company’s
focus is on the development
of various types of
properties, which includes
residential, commercial, or
mixed-use projects. It has a
registered capital of
approximately US$78.0
million
Office lease relating to the
office in Beijing
2021 N/A, wire
transfer
2,480 4%
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Five largest
suppliers for the
Y ear 2023 Supplier background Products/services purchased
Business
relationship
since
Typical
Credit Term
and Payment
Method
Purchase
amount
Percentage
of total
purchases
(RMB’000)
Supplier E A well-structured,
multidisciplined
comprehensive medical
education center affiliated to
a university, with 10
university hospitals and 11
hospitals serving as teaching
hospitals as of September 1,
2023
Patient registry study for HP
patients
2021 30 days,
wire
transfer
2,378 4%
Total 29,963 45%
Five largest
suppliers for the
Y ear 2022 Supplier background Products/services purchased
Business
relationship
since
Typical
Credit Term
and Payment
Method
Purchase
amount
Percentage
of total
purchases
(RMB’000)
Ascendis Pharma
Endocrinology
Division A/S
A global pharmaceutical
Company headquartered in
Denmark focusing on
endocrinology rare diseases,
wholly owned by Ascendis
Pharma A/S
Clinical supply of the Core
Product, Clinical Consulting,
Cost Sharing for the Core
Product
2018 30-60 days,
wire
transfer
63,499 39%
Ascendis Pharma
Bone Diseases
A/S
A global pharmaceutical
Company headquartered in
Denmark focusing on bone
diseases, wholly owned by
Ascendis Pharma A/S
Clinical supply of
palopegteriparatide, Clinical
Consulting
2018 30-60 days,
wire
transfer
6,576 4%
Supplier E A well-structured, multi-
disciplined comprehensive
medical education center
affiliated to a university,
with 10 university hospitals
and 11 hospitals serving as
teaching hospitals as of
September 1, 2023
Patient registry study for HP
patients
2021 30 days, wire
transfer
6,440 4%
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Five largest
suppliers for the
Y ear 2022 Supplier background Products/services purchased
Business
relationship
since
Typical
Credit Term
and Payment
Method
Purchase
amount
Percentage
of total
purchases
(RMB’000)
Supplier F A company providing
construction services
headquartered in Suzhou. It
has a registered capital of
RMB50 million
Construction unit relating to
Suzhou Industrial Park
2022 60 days, wire
transfer
5,503 3%
Supplier B A leading CRO headquartered
in Hangzhou, providing full-
service for the global
biopharmaceutical and
medical device industries. It
had revenue of
approximately RMB7,384.0
million and more than 9,500
employees in 2023
according to its annual
report
 Core Product: safety
evaluation, clinical trial
execution, and central
image, CSR preparation
 Palopegteriparatide: assist
us with data management,
safety information
collection and biostatic
analysis
 TransCon CNP
(navepegritide):
pharmacovigilance service
for safety evaluation
2019 60 days, wire
transfer
5,355 3%
Total 87,353 53%
CUSTOMERS
To date, we have not generated any revenue from product sales and do not expect to
generate any revenue from product sales before the commercialization of one or more of our
drug candidates.
COMPETITION
The pharmaceutical industry is highly competitive and subject to rapid and significant
change, and we anticipate direct competition from other organizations developing LAGH
therapies and other types of endocrine therapies. This would include companies such as Novo
Nordisk A/S, Anhui Anke Biotechnology (Group) Co., Ltd, GeneScience Pharmaceutical Co.,
Ltd., Xiamen Amoytop Biotech Co., Ltd., Shanghai United Sai’er Biology Engineering Co.,
Ltd., I-Mab Biopharma Co., Ltd., as well as other major multinational pharmaceutical
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companies, China-based innovative biopharmaceutical companies, established biotechnology
companies, specialty pharmaceutical and generic drug companies, universities, and other
research institutions. Many of our competitors have greater resources, as well as larger R&D
functions and more experienced marketing and manufacturing organizations. As a result, these
companies may be more effective in selling and marketing their products or obtaining
regulatory approval more rapidly than we are able to if their drug candidates are in clinical
development.
Additionally, our competitors may succeed in developing, acquiring or licensing
technologies and drug products that are superior to, or more effectively marketed than, the drug
candidates that we are currently developing or that we may develop, which could render our
products obsolete and noncompetitive. For additional information regarding the companies that
may be competitive with our drug candidates currently in development, see “– Our Drug
Pipeline.” Our commercial opportunity could be reduced or eliminated if our competitors
develop or market products or therapies that are more effective, safer or less costly than our
current or future drug candidates, or obtain regulatory approval for their products more rapidly
than we may obtain approval for our drug candidates.
QUALITY MANAGEMENT SYSTEM
We believe that an effective quality management system is critical to ensuring the quality
of our products and maintaining our reputation and success. Our senior management team is
actively involved in formulating internal quality control policies and monitoring our overall
quality control process. We have established comprehensive quality control procedures and
protocols that span across the entire clinical development lifecycle.
We have established an independent quality management system and devote significant
attention to quality control and assurance for the clinical development of our drug candidates.
Our quality management team monitors and drives our quality performance, allocates sufficient
resources to implement the quality management system and sets the quality governance
mechanism. We also conduct regular training so that our quality management team understands
the regulatory requirements applicable to the operation of our business.
The primary responsibilities of our quality management team include the following:
 establishing a robust quality management system for our line functions to ensure
that all our operational activities conform with global and local regulatory
requirements; continuously assessing and evaluating the system for optimization and
improvement;
 developing and implementing audit plans for investigator site audits, internal
process audits and vendor audits to ensure our compliance with applicable
regulatory requirements;
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 establishing and maintaining integrated risk-based quality review and evaluation
strategy and metrics and coordinating and performing risk evaluations for our
Company and individual projects to ensure adequate quality metrics and timely
reporting to our senior management team;
 maintaining our vendor management system, which includes establishing
appropriate processes for the assessment of vendors, monitoring their performance,
reviewing and approving quality agreements and other duties; and
 ensuring patient safety and well-being during our clinical trials and the credibility
of our clinical trial data.
RISK MANAGEMENT
We recognize that risk management is critical to the success of our business operation.
Key operational risks faced by us include changes in the general market conditions and the
regulatory environment of the Chinese and global pharmaceutical markets, our ability to
develop, manufacture and commercialize our drug candidates, and our ability to compete with
other pharmaceutical companies. See “Risk Factors” for a discussion of various risks and
uncertainties we face. We also face various market risks. In particular, we are exposed to credit,
liquidity, interest rate and currency risks that arise in the normal course of our business. See
“Financial Information – Financial Risk Disclosure” for a discussion of these market risks.
We have adopted a consolidated set of risk management policies which set out a risk
management framework to identify, assess, evaluate and monitor key risks associated with our
strategic objectives on an ongoing basis. Our audit committee, and ultimately our Directors,
supervise the implementation of our risk management policies. Risks identified by
management will be analyzed on the basis of likelihood and impact, and will be properly
followed up and mitigated by us and reported to our Directors.
The following key principles outline our approach to risk management and internal
control:
 Our governance committee which is comprised of senior management and functional
heads will oversee and manage the overall risks associated with our business
operations, including (i) reviewing and approving our risk management policy to
ensure that it is consistent with our corporate objectives; (ii) reviewing and
approving our corporate risk tolerance; (iii) monitoring the most significant risks
associated with our business operation and our management’s handling of such
risks; (iv) reviewing our corporate risk in the light of our corporate risk tolerance;
and (v) monitoring and ensuring the appropriate application of our risk management
framework across our Company.
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 Our Chief Executive Officer is responsible for (i) formulating and updating our risk
management policy and target; (ii) reviewing and approving major risk management
issues of our Company; (iii) promulgating risk management measures; (iv)
providing guidance on our risk management approach to the relevant departments in
our Company; (v) reviewing the relevant departments’ reporting on key risks and
providing feedback; (vi) supervising the implementation of our risk management
measures by the relevant departments; (vii) ensuring that the appropriate structure,
processes and competences are in place across our Company; and (viii) reporting to
our Directors on our material risks.
 The relevant departments in our Company, including without limitation the finance
department, the legal and compliance department and the human resources
department, are responsible for implementing our risk management policy and
carrying out our day-to-day risk management practice. In order to formalize risk
management across our Company and set a common level of transparency and risk
management performance, the relevant departments will (i) gather information about
the risks relating to their operation or function; (ii) conduct risk assessments, which
include the identification, prioritization, measurement and categorization of all key
risks that could potentially affect their objectives; (iii) prepare a risk management
report annually for our Chief Executive Officer’s review; (iv) continuously monitor
the key risks relating to their operation or function; (v) implement appropriate risk
responses where necessary; and (vi) develop and maintain an appropriate
mechanism to facilitate the application of our risk management framework.
We consider that our Directors and senior management possess the necessary knowledge
and experience in providing good corporate governance oversight in connection with risk
management and internal control. See “Directors and Senior Management” for details
regarding their qualification and experiences.
INTERNAL CONTROL
We have engaged an independent internal control consultant to review and provide
remedial advice on our internal control and risk management. The internal control consultant
has conducted a review procedure on our internal control system in certain aspects, including
financial reporting and disclosure controls, corporate level controls, information system
control management and other procedures for our operations. The internal control consultant
conducted its work in June and July 2023 and has not identified any deficiencies in our risk
management and internal control system in the review that would have had a material adverse
impact on our business, financial condition or results of operations.
Our Directors are responsible for establishing and ensuring effective internal controls to
safeguard our Shareholder’s investment at all times. Our internal control policies set out a
framework to identify, assess, evaluate and monitor key risks associated with our strategic
objectives on an ongoing basis.
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During the Track Record Period, we have regularly reviewed and enhanced our internal
control system. Below is a summary of the internal control policies, measures and procedures
we have implemented or plan to implement:
 We have adopted various measures and procedures regarding each aspect of our
business operation, such as contract management policy, risk management and
protection of intellectual property. We provide periodic training about these
measures and procedures to our employees as part of our employee training
program. In addition, we monitor the implementation of these measures and
procedures.
 Our Directors (who are responsible for monitoring the corporate governance of our
Company) with help from our legal advisers, will also periodically review our
compliance status with all relevant laws and regulations after the Listing.
 We have established an audit committee effective upon the Listing which (i) makes
recommendations to our Directors on the appointment and removal of external
auditors; and (ii) reviews the financial statements and renders advice in respect of
financial reporting as well as oversees internal control procedures of our Company.
 We maintain strict anti-corruption policies among our employees and we believe we
will therefore be less affected by the increasingly stringent measures taken by the
PRC government to correct corruptive practices in the pharmaceutical industry. We
strictly prohibit bribery or other improper payments in any of our business
operations. This prohibition applies to all business activities, anywhere in the world,
whether involving government officials or healthcare professionals. Improper
payments prohibited by this policy include bribes, kickbacks, excessive gifts or
entertainment, or any other payment made or offered to obtain an undue business
advantage. We keep accurate books and records that reflect transactions and asset
dispositions in reasonable detail. Requests for false invoices or payment of expenses
that are unusual, excessive or inadequately described are rejected and promptly
reported. Misleading, incomplete or false entries in our books and records are never
acceptable. We will also ensure that any future commercialization team personnel
comply with applicable legal requirements, which include restrictions on promoting
drugs for unapproved uses or patient populations and limitations on industry-
sponsored scientific and educational activities.
 We have established procedures to protect the confidentiality of personal
information of stakeholders, including but not limited, employees and healthcare
professionals. In general, we do not have access to patients’ personal data. We
maintain policies which require our personnel to be trained on collecting, processing
and safeguarding personal information and require our CROs to have data protection
measures in place and related clauses in our agreements with them under which they
are responsible for safeguarding data in their possession. Access to clinical trial data
has been strictly limited to authorized personnel only according to the GCP and
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relevant regulations. Additionally, we require external parties and internal
employees involved in clinical trials to comply with confidentiality requirements.
Data are to be used only for the intended use, as agreed by the patients and
consistent with the consent form and no use of data falls outside the scope of the
consent form will be permitted without obtaining consent from patients.
 We have engaged several PRC law firms to advise us on and keep us abreast with
PRC laws and regulations. We will continue to arrange various training to be
provided by external legal advisers from time to time when necessary and/or any
appropriate accredited institution to update our Directors, senior management, and
relevant employees on the latest PRC laws and regulations.
 Our Directors believe that compliance creates sustainable value for us and are
dedicated to cultivating a compliance culture among all of our employees. To ensure
such compliance culture is embedded into everyday workflow and set the
expectations for individual behavior across the organization, we regularly conduct
internal compliance checks and inspections, adopt strict accountability internally
and conduct compliance training.
LAND AND PROPERTIES
We have leased and occupied approximately 1,113.07 square meters of office space in
China (including Hong Kong, Macau and Taiwan) as of the date of this document. The relevant
lease agreements have lease expiration dates ranging from March 31, 2025 to August 28, 2026.
We do not anticipate undue difficulty in renewing our leases upon their expiration, and we do
not anticipate any material impact on our operations if we fail to renew any of the leases.
The following table sets forth a summary of our leased properties and land use right as
of the Latest Practicable Date.
Location
Type of
Property
Gross
Floor Area
(sq.m)
Property
Leased/
Land Use
Right Expiry Date
Beijing, China Office 266.46 Leased June 14, 2026
Shanghai, China Office 482.04 Leased September 30,
2025
Shanghai, China Office 64.49 Leased December 14,
2025
Shanghai, China Warehouse 45 Leased September 30,
2025
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Location
Type of
Property
Gross
Floor Area
(sq.m)
Property
Leased/
Land Use
Right Expiry Date
Shanghai, China Registered
Address
/ Leased August 28, 2026
Suzhou, China Office 10 Leased December 26,
2025
Suzhou, China Office 220 Leased January 31, 2026
Taiwan, China Office 25.08 Leased March 31, 2025
INSURANCE
We maintain insurance policies that we consider to be in line with market practice and
adequate for our business. Our insurance policies cover AEs in our clinical trials, including
personal injury and property loss incurred in any clinical trials conducted or funded by our
Company. See “Risk Factors – We have limited insurance coverage, and any claims beyond our
insurance coverage may result in us incurring substantial costs and a diversion of resources.”
SOCIAL, HEALTH, WORK SAFETY AND ENVIRONMENTAL MATTERS
We are subject to various social, health, safety and environmental laws and regulations
and our operations are regularly inspected by local government authorities. We believe we have
adequate policies and SOPs ensuring compliance with all social, health, safety and
environmental protection regulations. Particularly, we believe our continued growth rests on
integrating social values into our business. We intend to create a lasting positive
environmental, social and governance (“ESG”) impact on our future customers, suppliers and
the broader community whom our operation may impact. We acknowledge our responsibilities
on environmental protection, social responsibilities and are aware of the climate-related issues
that may have impact on our business. We are committed to complying with ESG reporting
requirements upon Listing.
Our Board has the collective and overall responsibility for establishing, adopting and
reviewing the ESG vision, policy and target of our Group, and evaluating, determining and
addressing our ESG-related risks at least once a year. Our Board may assess the ESG risks and
review our existing strategy, target and internal controls, and suggest for enhancements for our
ESG management schemes. Our management team is generally responsible for carrying out the
ESG policies in executing our Company’s business operations. Furthermore, we will form an
ESG working group that will work on ESG requirements of our suppliers, including giving
priority to suppliers with environmentally friendly products and services. Our ESG working
group will also closely monitor environmental and social risks in our supply chain. Finally, our
Board will also engage independent third parties to evaluate potential ESG risks faced by our
Company, provide comment on our ESG Policy and strategies, and set targets so that the ESG
Policy will be up-to-date.
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We monitor ESG-related risks and opportunities that may impact our business, strategy
and financial performance and evaluate the magnitude of resulting impact by taking into
consideration the relevant matters stipulated in Appendix C2 to the Listing Rules and
applicable laws, regulations and industry standards. We will also take environmental protection
as an important part in employee training, and continue to raise the awareness of energy
conservation and environmental protection of all employees in the Group, helping us achieve
a green, healthy and sustainable development.
Sets forth below details of our ESG focus on our business operations:
 Manufacturing activities. We are committed to integrating ESG principles into
anticipated manufacturing activities, especially when engaging with CDMOs. In
selecting WuXi Biologics preparing for anticipated manufacturing activities, we
take into consideration the ESG management policies including manufacturing
measures and procedures adopted by it. We align with the ESG goals and work
closely with Wuxi Biologics and any other CDMOs to ensure that our manufacturing
activities are sustainable and adhere to the ESG standards.
 Clinical trials. We are committed to managing chemical waste effectively during
clinical trials. We follow standard protocols to ensure that waste is disposed of in a
manner that minimizes environmental impact. We also ensure that our clinical trials
are conducted ethically, with focus on patient safety.
 Product safety. In anticipation of the commercialization of drug candidates, we will
place a high priority on our product safety by adhering to rigorous testing and
quality control measures to ensure the safety and efficacy of our products and
following transparent reporting practices to keep stakeholders informed about
product safety issues.
 Drug pricing. We recognize the importance of fair drug pricing in its ESG policies.
In anticipation of the commercialization of drug candidates, we strive to set drug
prices based on the value they provide to patients, taking into account factors such
as the cost of development, the therapeutic benefits of the drug, and the need for
accessibility and affordability.
 Supply chain management. We are committed to integrating ESG principles into our
supply chain management. In anticipation of the commercialization of drug
candidates, we will work closely with our suppliers to ensure they meet the shared
business ethics and sustainability standards.
We strive to provide a safe working environment for our employees. We have
implemented work safety guidelines setting out safety practices, accident prevention and
accident reporting. When we engage in manufacturing activities in the future, we will
implement company-wide environmental, health and safety policies and operating procedures.
We expect our expenses in relation to environmental compliance matters to increase going
forward as we implement these policies and procedures.
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Corporate social responsibility is also a key part of our core growth philosophy which,
along with our focus on sustainability, diversity and public interests, is expected to generate
value for our Shareholders. As such, we are committed to incorporating corporate social
responsibility principles into our operational decisions and practices. For instance, in 2020, we
entered into a five-year strategy cooperation under a funding agreement with CHARD, a
national, non-profit, cooperative exchange platform for rare diseases, to support the founding
of Achondroplasia Advisory Board. We also invested in various other corporate social
responsibility efforts, including making donations to organizations such as hospitals,
universities and foundations that combat COVID-19, and sponsoring medical conferences. In
2022, 2023 and the nine months ended September 30, 2024, respectively, we spent
approximately RMB2.5 million, RMB1.9 million and RMB0.3 million, in regards to the
foregoing corporate social responsibility activities.
We are subject to environmental protection and occupational health and safety laws and
regulations in China. If we fail to comply with environmental, health and safety laws and
regulations, we could become subject to fines, penalties or damages or incur costs that could
have a material adverse effect on the success of our business. See “Risk Factors – Other Risks
Related to Obtaining Regulatory Approval of Our Drug Candidates and Other Legal
Compliance Matters – If we fail to comply with environmental, health and safety laws and
regulations, we could become subject to fines, penalties or damages or incur costs that could
have a material adverse effect on the success of our business” on the potential impact of such
risks. However, since we focused on provide treatment in selected endocrinology diseases and
have not yet commenced the commercial manufacturing during the Track Record Period, we
did not incur material environmental compliance expenses during such period and we do not
expect the expenses of such compliance to be material going forward. We will make continuous
endeavors to contribute a better environment by limiting the emission of greenhouse gas,
appealing employees to live an eco-friendly lifestyle and so on.
As advised by our PRC Legal Advisor, during the Track Record Period and up to the
Latest Practicable Date, we did not have any incidents or complaints which had a material and
adverse effect on our business, financial condition or results of operations and had complied
with laws, rules or regulations during ordinary business operation in relation to ESG, safety
and environmental protection, in all material aspects in the PRC, including but not limited to
Good Clinical Trial Practice for Drugs (ᑗґ༊᜕ሯඎ၍ଣ஝ᇍ), Notice on Issuing
the Administration Rules of Drug Clinical Trial Institution (ᑗґ༊᜕ዚ࿴၍ଣ
ʮѓ), Environmental Protection Law of PRC (),
Administration Rules on Environmental Protection of Construction Projects (ணධͦᐑྤ
ᚐ၍ଣૢԷ), Environmental Impact Assessment Law of PRC ( ʕശɛ͏΍ձ਷ᐑྤᅂ
), Administrative Measures for Pollutant Discharge Licensing (for Trial
Implementation) (ج(༊Б)), Regulation on Pollutant Discharge Permit
Administration ( રϮ஢̙၍ଣૢԷ), Fire Prevention Law of the PRC ( ʕശɛ͏΍ձ਷
) and others.
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OUR CONTROLLING SHAREHOLDERS
As at the Latest Practicable Date, Ascendis Pharma A/S, through its wholly-owned
subsidiaries, Ascendis Pharma Endocrinology Division, Ascendis Pharma Growth Disorders
and Ascendis Pharma Bone Diseases (collectively, “Ascendis Subsidiaries”), was indirectly
interested in an aggregate of approximately 40.12% of the Shares in the Company. Immediately
after the completion of the Global Offering (assuming the Offer Size Adjustment Option and
the Over-allotment Option are not exercised and no Shares are issued under the Post-IPO Share
Award Scheme), Ascendis Pharma A/S, through the Ascendis Subsidiaries, will be indirectly
interested in approximately 36.58% of the Shares in the Company.
As at the Latest Practicable Date, Vivo Plenilune IX Limited, or Vivo Capital was
interested in approximately 35.24% of the Shares in the Company. Immediately after the
completion of the Global Offering (assuming the Offer Size Adjustment Option and the
Over-allotment Option are not exercised and no Shares are issued pursuant to the Post-IPO
Share Award Scheme), Vivo Capital will be interested in 32.14% of the total issued share
capital of our Company (excluding any Shares that may be subscribed by Vivo Capital under
the Global Offering). Vivo Capital is a wholly-owned subsidiary of Vivo Capital Fund IX
(Cayman), L.P ., which is in turn controlled by its general partner, Vivo Capital IX (Cayman),
LLC. (collectively, “Vivo Funds”).
Accordingly, Ascendis Pharma A/S, the Ascendis Subsidiaries, and Vivo Funds will be the
Controlling Shareholders of the Company after the Global Offering.
DELINEATION OF BUSINESS
Business of Our Group
We are a late-stage, near-commercialization biopharmaceutical company focused on
providing treatments in selected endocrinology diseases in China (including Hong Kong,
Macau and Taiwan). As of the Latest Practicable Date, we had a pipeline of three endocrine
drug candidates, namely lonapegsomatropin, TransCon CNP (navepegritide) and
palopegteriparatide, among which, lonapegsomatropin has completed Phase 3 pivotal trial for
the treatment of PGHD in China, and the other two drug candidates are being studied in clinical
trials in China.
Delineation from Ascendis Pharma
Ascendis Pharma A/S is a biopharmaceutical company that has been listed on Nasdaq
(Ticker Symbol: ASND) since 2015. Applying its transient conjugation technology (TransCon),
Ascendis Pharma currently has a pipeline of three independent endocrine rare disease drug
candidates (lonapegsomatropin, TransCon CNP (navepegritide) and palopegteriparatide
(excluding the rights granted to our Company in China (including Hong Kong, Macau and
Taiwan))). Among the three drug candidates, lonapegsomatropin is commercially available in
the United States, having received marketing approval from the FDA in 2021.
Lonapegsomatropin has also received marketing approval from the EMA in 2022 and is
undergoing clinical development in Japan. Palopegteriparatide was also approved by the EMA
and the FDA in November 2023 and August 2024, respectively, for the treatment of adult
patients with chronic hypoparathyroidism (“HP”) and was commercially launched in certain
European countries in January 2024.
RELATIONSHIP WITH THE CONTROLLING SHAREHOLDERS
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As disclosed in the section headed “Business – Collaborations – Exclusive License
Agreements with Ascendis Pharma” in this document, our Company obtained from Ascendis
Pharma an exclusive, royalty-free license under its applicable owned patents and other
intellectual property to develop, manufacture and commercialize lonapegsomatropin, TransCon
CNP (navepegritide) and palopegteriparatide (collectively, “Licensed Products”) in China
(including Hong Kong, Macau and Taiwan), specifically, long-acting products or product
candidates that are being developed and/or commercialized for use in all human indications
(excluding diabetes (and certain related metabolic disorders), obesity and ophthalmology) that
contains a hGH, CNP or PTH, as the case may be. While our drug candidates are in-licensed
from Ascendis Pharma, there is a clear delineation of business between our Company and
Ascendis Pharma, as the licenses granted to our Company in China (including Hong Kong,
Macau and Taiwan) are exclusive so that no one other than our Company (except where our
Company grants sublicenses to its affiliates in China (including Hong Kong, Macau and
Taiwan)) can develop, manufacture and commercialize the Licensed Product in China
(including Hong Kong, Macau and Taiwan), and Ascendis Pharma has agreed not to compete
with our Company in China (including Hong Kong, Macau and Taiwan) in respect of the
Licensed Products.
Ascendis Non-Compete Undertaking
Pursuant to the Exclusive License Agreements, during the term of the respective
Exclusive License Agreement, neither the Ascendis Subsidiaries (being parties to the Exclusive
License Agreements) nor its affiliates shall conduct, or intentionally enable, or participate in,
or license or otherwise authorize any third party to conduct, enable or participate in, the
research, development, manufacture or commercialization of any Competing Product in China
(including Hong Kong, Macau and Taiwan). A “Competing Product” shall mean a long-acting
product (a product that is intended to be administered to a subject, once a week or less
frequently than once a week in the case of hGH and CNP , and once a day or less frequently
than once a day in the case of PTH) developed and/or commercialized for use in the all human
indications (subject to certain exceptions (including diabetes (and certain related metabolic
disorders), obesity and ophthalmology)) that contains a hGH, CNP or PTH, as the case may be.
In addition, under the Shareholders’ Agreement, each of the Ascendis Subsidiaries (being
parties to the Shareholders’ Agreement) undertakes and covenants to our Company that, it will
not, without our prior written consent, either on its own account or through any of his/its
controlled affiliates, or in conjunction with or on behalf of any other person: (i) carry out or
be engaged in the research, development, manufacturing or commercialization of any product
for the treatment of any diseases involving hyper- or hyposecretion of hormones in China
(including Hong Kong, Macau and Taiwan) (the “Competing Business”); (ii) directly or
indirectly own any interest in a third party engaged in the Competing Business other than
holding in aggregate less than ten percent (10%) of the issued share capital of any entity
engaged in the Competing Business as a passive investor; (iii) solicit or entice away or attempt
to solicit or entice away from any member of our Group, any person or entity who is a
customer, client, employee, representative, agent or correspondent of our Group or in the habit
of dealing with our Group, or (iv) provide services to any entity engaged in the Competing
Business in any form. Such non-compete undertaking shall terminate upon the termination of
each of the Exclusive License Agreements.
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Right of First Negotiation
In addition, during the term of the Exclusive License Agreements, Ascendis Pharma is
required to notify our Company prior to engaging in substantive discussions with third parties
regarding the license to such third parties by Ascendis Pharma or its affiliates under the
Ascendis platform technology (including Ascendis Pharma’s proprietary chemistry, materials
and methodologies for transiently covalently coupling a substrate of interest to various carriers
via a transient conjugation linker, thereby allowing release of the transiently linked substrate
in a controlled manner over time for a therapeutic or prophylactic effect) of rights to develop
or commercialize endocrine product(s) in China (including Hong Kong, Macau and Taiwan) (a
“ROFN Opportunity”). No later than 20 business days after receipt of such notice, the
Company shall notify Ascendis Pharma whether it wishes to enter into negotiations with
Ascendis Pharma to negotiate an agreement for our Company to obtain the right corresponding
to such ROFN Opportunity. If our Company does not timely notify Ascendis Pharma that it
wishes to negotiate for the ROFN Opportunity, or notifies Ascendis Pharma that it is not
interested in the ROFN Opportunity, Ascendis Pharma shall be free to engage with third parties
discussions of such ROFN Opportunity. If the Company timely notifies Ascendis Pharma that
it wishes to negotiate an agreement for such ROFN Opportunity, the parties shall enter into
good faith negotiations not to exceed 90 days with the goal of finalizing the terms of and
executing the relevant license agreement. If after the expiration of such ninety (90)-day period
(the “ROFN Negotiation Stop Date”), the Parties have not executed the relevant license
agreement, Ascendis Pharma shall be free to engage with third parties discussions of such
ROFN Opportunity provided that Ascendis Pharma shall not grant such ROFN Opportunity to
a third party on terms more favorable to such third party than last offered by Ascendis Pharma
to our Company for an additional one 180 days after the ROFN Negotiation Stop Date.
Apart from the aforesaid business, Ascendis Pharma is also advancing oncology as its
second therapeutic area of focus which is different in nature from our Group’s business.
On the bases of the above, the Directors believe that the Group’s businesses and Ascendis
Pharma’s businesses are clearly delineated and do not directly or indirectly compete with each
other.
Delineation from Vivo
Vivo Funds are under the management of Vivo Capital LLC. Founded in 1996, Vivo
Capital LLC is a global investment firm focused on healthcare with approximately US$5.8
Billion in assets under management as of December 31, 2023, and provides a multi-fund
Investment platform, covering private equity including buyout, venture capital, and public
equity. Vivo Capital LLC and funds managed by Vivo Capital LLC (collectively, “Vivo”) invest
broadly in healthcare across all fund strategies, including biotechnology, pharmaceuticals,
medical devices, and healthcare services, with a focus on the largest healthcare markets.
RELATIONSHIP WITH THE CONTROLLING SHAREHOLDERS
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Interest in the Investee
As of the Latest Practicable Date, among all investee portfolio companies in which Vivo
holds 10% or more equity interest, only one portfolio investee company (the “ Investee ”)
engages in the research and development of endocrinology therapies/drugs. As of the Latest
Practicable Date, Vivo holds 22.74% equity interest in the Investee on a fully-diluted basis.
We do not consider that the business of the Investee competes or is likely to compete with
the business of our Group. To the best knowledge of the Company, the Investee is a
China-based rare disease therapeutics company and currently has a drug product for the
treatment of pediatric patient with congenital adrenal hyperplasia (CAH) in China. CAH is an
endocrine rare disease resulting from the deficiency of one of the enzymes required for cortisol
synthesis in the adrenal cortex. The Directors believe that the Investee’s businesses are clearly
delineated from the Group’s businesses for the following reasons:
 Different therapeutic focus. To the knowledge of the Directors, the Investee does not
plan to engage in the development of drugs/therapies for GHD, HP or ACH;
 Different management and operational team. To the knowledge of the Directors, our
Directors and senior management do not hold any position in the Investee.
Moreover, there is no overlapping personnel in the research and development teams
of our Group and the Investee; and
 Corporate governance. Our Company has adopted and will adopt certain corporate
governance measures to manage the conflicts of interest as set forth in “– Corporate
governance measures” as below.
In addition, while Vivo may acquire interests in certain businesses that operate in the
healthcare sector, Vivo normally provides financial capital in its portfolio companies. The
business decisions of each Vivo’s portfolio company are solely made by the directors and
senior management of such portfolio company.
Save as disclosed above, as of the Latest Practicable Date, none of our Controlling
Shareholders, have any interest in any other company which is principally engaged in a
business similar to the principal business of the Company, and accordingly is not subject to
disclosure pursuant to Rule 8.10 of the Listing Rules.
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INDEPENDENCE FROM OUR CONTROLLING SHAREHOLDERS
The Directors are of the view that the Group is able to carry on its business independently
from the Controlling Shareholders (including their close associates) following completion of
the Global Offering for the following reasons:
Operational and Administrative Independence
The Company has a full-time management team and team of staff to carry out its own
operation independent of the Controlling Shareholders. The support functions comprising
accounting, administration, corporate secretarial, compliance and human resource management
will also continue to be handled by a team of staff employed directly by the Company and are
separated from the Controlling Shareholders. In addition, we have established our internal
organizational and management structure which includes Shareholders’ meetings, our Board
and other committees and formulated the terms of reference of these bodies in accordance with
the requirements of the applicable laws and regulations, the Listing Rules and the Articles of
Association, so as to establish a regulated and effective corporate governance structure with
independent departments, each with specific area of responsibilities.
During ordinary and usual course of business, the Group has entered into transactions
with Ascendis Subsidiaries, including the Exclusive License Agreements, the Clinical Supply
Agreements, the Cost Sharing and V olume Commitment Agreement and Commercial Supply
Agreement. See “Connected Transactions” for details. Such transactions were and will be
conducted in the ordinary and usual course of business of the Group, on an arm’s length basis
and on normal commercial terms.
Effective Control over the Development, Regulatory and Commercialization Activities
With respect to the development of the Company’s products, pursuant to the Exclusive
License Agreements, our Group is solely responsible for any clinical trial activities carried out
as part of our development and commercialization activities in China (including Hong Kong,
Macau and Taiwan). The parties shall also agree to a R&D plan that sets forth the parties
respective research and technical development plan activities, which may be amended by the
joint development committee established by both parties in accordance with the Exclusive
License Agreements. Apart from the products supplied by Ascendis Pharma under the Clinical
Supply Agreements for use in conducting clinical trials and the assistance provided by
Ascendis Pharma under the Exclusive License Agreements, our Group procures equipment,
materials and services that are essential for its R&D activities, from its suppliers that are
independent from Ascendis Pharma. For details of the Clinical Supply Agreements and
Exclusive License Agreements, see “Connected Transactions.” The development of Licensed
Products will be monitored by a joint development committee with equal representation of the
Company and Ascendis Pharma. All decisions of such committee shall be made by unanimous
vote. If the committee is unable to reach consensus on certain matter, with certain specific
pre-agreed exceptions, our Company shall have the final decision-making authority. For details
regarding the R&D activities conducted by the Company as of the date of this document, please
RELATIONSHIP WITH THE CONTROLLING SHAREHOLDERS
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refer to sections headed “Business – Research and Development”, “Business – Our Drug
Pipeline – Lonapegsomatropin – A Long-Acting hGH Replacement Therapy for PGHD – Our
R&D Work”, “Palopegteriparatide – A PTH Replacement Therapy Addressing the Underlying
Cause of HP – Our R&D Work” and “TransCon CNP (navepegritide) – A Disease-Modifying
Therapy for ACH – Our R&D Work.”
In terms of regulatory filings, the Company has the sole responsibility for obtaining and
maintaining, and shall own, all regulatory approvals for Licensed Product developed under
each Exclusive License Agreement from regulatory authorities in each of the jurisdictions in
China (including Hong Kong, Macau and Taiwan). Where reasonably requested by us, Ascendis
Pharma would provide assistance to us to support the obtaining and maintenance of regulatory
approvals of the Licensed Products in China (including Hong Kong, Macau and Taiwan). For
details, see “Connected Transactions – Exclusive License Agreements.”
The commercialization of Licensed Products in China (including Hong Kong, Macau and
Taiwan) will be monitored by a joint commercialization committee with equal representation
of the Company and Ascendis Pharma, the current marketing authorization holder. All
decisions of such committee shall be made by unanimous vote. If the committee is unable to
reach consensus on certain matter, with certain specific pre-agreed exceptions, our Company
shall have the final decision-making authority acting in good faith. As a late-stage,
near-commercialization biopharmaceutical company, the Company has taken solid strides
towards realizing independent commercialization capabilities, as evidenced by (i) the
commercialization team it built up internally; and (ii) the know-how and expertise it
accumulated from designing the tailor-made programs for commercialization, patient
awareness and market access in China. For details, please see the section headed “Business –
Commercialization Plan, Patient Support and Market Access.”
On the basis of the above, our Directors are of the view that, the Company retains
effective control over the development, regulatory and commercialization activities of its
products in China (including Hong Kong, Macau and Taiwan), and the Company has all
requisite resources and is capable of carrying on the business of R&D, application for
registration and clinical trials in China (including Hong Kong, Macau and Taiwan)
independently of Ascendis Pharma.
Mutual and Established Relationship
The roles of Ascendis Pharma, as our global partner, and us are mutually beneficial and
complementary to each other. On one hand, the licenses in China (including Hong Kong,
Macau and Taiwan) granted by Ascendis Pharma, provide us with the exclusive rights to
develop, manufacture and commercialize the Licensed Products, which have been validated in
the global development programs conducted by Ascendis Pharma. On the other hand, the
licensing arrangement also enables us to utilize the know-how, data, materials and other
information relating to the global clinical trials conducted by Ascendis Pharma to optimize the
design of our clinical trials in China (including Hong Kong, Macau and Taiwan). The
continuous communication with and ongoing support from Ascendis Pharma will also benefit
our R&D activities.
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As the sole strategic long-term partner of Ascendis Pharma in China (including Hong
Kong, Macau and Taiwan), we provide an exclusive channel through which Ascendis Pharma
and us collaboratively commercialize the endocrinology products, so as to unlock and tap into
the vast market in China (including Hong Kong, Macau and Taiwan) with unmet medical needs.
The successful commercialization of the Licensed Products to address the needs of the local
markets in China (including Hong Kong, Macau and Taiwan) will advance our mutual goal of
extending the footprint of TransCon drug candidate portfolio globally. We are able to provide
exclusive benefits for Ascendis Pharma in following aspects. We have established an
experienced China-based leadership team and a strong in-house operational team. Our
Company leverages its endocrinology expertise, R&D and regulatory capabilities to help
Chinese patients access our drug candidates. In addition, in anticipation of the potential
BLA/NDA approval and subsequent commercial launch of our drug candidates, we started
building up a focused and specialized commercialization team with strong expertise in
endocrinology, to drive medical activities in the market of China (including Hong Kong, Macau
and Taiwan) in accordance with local rules and regulations, and we believe our key
commercialization leadership members, who have substantial experience and strong track
records relevant to our pipeline drug candidates, can leverage their expertise launching
endocrine drugs in China (including Hong Kong, Macau and Taiwan). For details, see
“Business – Commercialization Plan, Patient Support and Market Access.”
Remote Risk of Termination or any Material Adverse Change of the Mutually Beneficial
Relationship
The risk of Ascendis Pharma terminating the Exclusive License Agreements and the
Clinical Supply Agreements is remote, as Ascendis Pharma has limited termination rights under
the agreements. Each of the Exclusive License Agreements became effective on November 7,
2018 and shall continue indefinitely and for so long as a valid claim of a licensed patent exists
in China (including Hong Kong, Macau and Taiwan). Ascendis Pharma may only terminate the
relevant Exclusive License Agreement for certain specified material breaches thereof by us, if
we challenge the validity of any patents licensed to us under such agreements, or upon
bankruptcy or insolvency-related events involving us, in each case subject to specified notice
periods, and upon immediate written notice in the event we undergo a change of control in
favor of certain kinds of, or certain specified, competitors. The Clinical Supply Agreements
will automatically terminate upon the termination of the Exclusive License Agreements.
More importantly, Ascendis Pharma’s interests are closely aligned with ours both in terms
of bringing endocrine drug candidates to patients in China (including Hong Kong, Macau and
Taiwan) and beyond as well as growing our Company for financial success. Accordingly,
termination or any adverse change of the existing relationship will be detrimental to the interest
of Ascendis Pharma as well. We believe that Ascendis Pharma and we currently cooperate
smoothly and we will continue to maintain our collaborative relationship with Ascendis
Pharma in the future. Our Directors are not aware of any circumstances which indicates that
our long-term relationship with Ascendis Pharma is likely to be terminated or materially and
adversely change.
RELATIONSHIP WITH THE CONTROLLING SHAREHOLDERS
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Anticipated Decrease of Reliance in the Future
It is industry norm that the licensee may have certain extent of reliance on licensing
partners, among others, (i) for conducting clinical trials, and (ii) for the supply of drug
candidates to support clinical development, manufacturing and commercialization of the
licensed product candidates. While we benefit from Ascendis Pharma’s ongoing support to our
R&D activities, clinical supplies, manufacturing and commercialization activities, we do not
believe that we have undue reliance on Ascendis Pharma. Our transactions with Ascendis
Pharma are conducted based on normal commercial terms and are consistent with market and
industry standard.
While we have entered into commercial supply agreement with Ascendis Pharma for the
supply of packaged products of lonapegsomatropin in the short term, we plan to enable local
commercial production of one or potentially more of our drug candidates upon completion of
technology transfer and obtaining necessary drug manufacturing licenses. Transitioning our
supply chain to local commercial production may also enable our Company to better control
the quality and consistency of the supply of our drug candidates and improve the certainty and
cost-effectiveness of production. We plan to implement a three-step drug procurement and
manufacturing plan to realize the commercialization of lonapegsomatropin as early as possible.
In the short term, we plan to source the commercial drug supply from our collaboration partner,
Ascendis Pharma. We have successfully reached a commercial supply agreement for the
commercial supply of the Core Product by Ascendis Pharma in October 2023. Please refer to
“Connected Transactions” for more details. In the medium term, we intend to collaborate with
WuXi Biologics, our designated local CDMO in China, for the commercial production of
lonapegsomatropin. In July 2023, we entered into the Technology Transfer Master Plan of the
Core Product with Ascendis Pharma, signifying the commencement of technology transfer
from Ascendis Pharma to us for the manufacturing of the Core Product. In December 2023, we
entered into a collaboration agreement with the WuXi Biologics, pursuant to which WuXi
Biologics will serve as the local CDMO of the Technology Transfer to conduct the process
development and validation achieving the localization of the manufacturing technology.
Completion of the Technology Transfer and Localization, which is expected to be in 2027, will
confer to us the technical capabilities to manufacture the lonapegsomatropin drug substance in
collaboration with WuXi Biologics. We are also developing the DCD technology in the form
of prefilled syringe as a drug delivery system for the lonapegsomatropin drug substance. Once
this development is finished, WuXi Biologics will have the capability to produce the Core
Product. For more information regarding the DCD, please refer to “Business – Research and
Development – CMC Development Programs – Dual Chamber Device Technology
Development.” The commercialization of the Core Product manufactured by WuXi Biologics
will start once we obtain the approval of Local BLA, which is expected to occur in 2028. In
the long term, we plan to establish our in-house manufacturing capabilities.
RELATIONSHIP WITH THE CONTROLLING SHAREHOLDERS
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In addition, beyond Ascendis Pharma, we plan to leverage our platform and network to
pursue business development opportunities with other potential biopharmaceutical partners
with endocrine drugs, drug candidates or technologies and platforms that may be synergistic
or complementary to our portfolio and/or our capabilities. We plan to fully exploit our
extensive knowledge in endocrinology and our deep understanding of the medical need and
technology, and through identifying and executing attractive licensing and collaboration
opportunities or through mergers and acquisitions, we seek to pursue business development
opportunities to further expand our portfolio with other potential biopharmaceutical partners
with endocrine drugs, drug candidates or technologies that may be synergistic or
complementary to our portfolio. For details, see “Business – Business Development.”
Effective Control over Manufacturing Drug Product Supply, Commercialization and IP
Protection
As mentioned above, in the short term, we plan to source the commercial drug supply of
drug products of lonapegsomatropin from our collaboration partner, Ascendis Pharma.
Concurrently, our Company has taken proactive steps to establish independent control over the
local manufacturing and supply of the drug products of lonapegsomatropin by partnering with
WuXi Biologics in the Technology Transfer and Localization and the development of the DCD
technology, which will equip us with the necessary technology and expertise to produce the
drug product. For more information regarding the Technology Transfer and Localization,
please refer to “Business – Commercial Supply and Manufacturing – Step 2: Collaborative
Local Manufacturing with Local CDMO.” Upon successful completion of the Technology
Transfer and Localization and the approval of the Manufacturing BLA, the Company will gain
the capability to locally produce the drug products of lonapegsomatropin. This includes
acquiring the framework, steps, and processes essential for the production of the drug products
of lonapegsomatropin. As outlined in our agreement with WuXi Biologics, they will adhere to
the production methods, procedural standards, and operational workflows specified by the
Company for manufacturing the drug products of lonapegsomatropin. Furthermore, the
Company will maintain control over the production pace of the drug product, ensuring that all
aspects of production align with the Company’s standards and strategic objectives.
Additionally, the Company will deploy specialists to be on-site to promptly address any issues
that arise during the manufacturing process.
Other than mentioned above, the Company also has effective control on the
commercialization, and IP protection of the lonapegsomatropin, TransCon CNP and
palopegteriparatide in China. For details, please refer to “Business – Commercialization Plan,
Patient Support and Market Access” and “Business – Intellectual Property.”
RELATIONSHIP WITH THE CONTROLLING SHAREHOLDERS
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Effective Management of the Conflicts of Interests
In addition, following the Listing, any transactions between the Company and Ascendis
Pharma will constitute connected transactions of the Company and will therefore be subject to
the requirements of the Listing Rules and corporate governance measures in relation to
connected transactions, including that any Directors holding overlapping positions with the
Ascendis Pharma will abstain from voting on the relevant board resolutions. Please see “–
Corporate Governance Measures” in this section for further information.
On the basis of the above, the Directors are of the view that the arrangements
contemplated under the Exclusive License Agreements, the Clinical Supply Agreements and
the Cost Sharing and V olume Commitment Agreement will not affect the Company’s ability to
operate independently and the Group’s operations are independent from the Ascendis Pharma.
Financial Independence
Our Group has an independent financial system and makes financial decisions according
to our Group’s own business needs and neither our Controlling Shareholders nor their close
associates may intervene with our use of funds. Our Directors believe that, the Company is also
able to independently secure equity investments from investors that are independent from the
Controlling Shareholders. Please refer to “History, Development and Corporate Structure –
Pre-IPO Investments.”
As at the Latest Practicable Date, there were no loans or guarantees provided by the
Controlling Shareholders to or for the benefit of the Group.
On the basis of the foregoing, the Company is financially independent from the
Controlling Shareholders.
RELATIONSHIP WITH THE CONTROLLING SHAREHOLDERS
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Independence of Directors and Management
The Board consists of nine Directors, comprising one executive Director, five non-
executive Directors and three independent non-executive Directors. See “Directors and Senior
Management” for further details. The table below sets forth the overlapping
director/management between our Company on the one hand and our Controlling Shareholders
(including their close associates) on the other hand:
Name
Position in our
Company
Material position in the
Controlling Shareholders
(including close associates)
Mr. Michael Wolff JENSEN Chairman of the Board,
Non-Executive
Director
Executive vice president, chief legal officer of
Ascendis Pharma A/S
Chairman of the board of directors in the
following companies:
Ascendis Pharma Bone Diseases
Ascendis Pharma, Ophthalmology
Division A/S
Ascendis Pharma Oncology Division A/S
Ascendis Pharma Growth Disorders
Ascendis Pharma Endocrinology Division
Ascendis Pharma Europe A/S
Member of the board of directors in Ascendis
Pharma, Inc. and Ascendis Pharma
Endocrinology, Inc.
Mr. Jan Møller
MIKKELSEN
Non-Executive Director President, chief executive officer, board member
and executive director of Ascendis Pharma A/S
Executive manager and member of the board of
directors in:
Ascendis Pharma Bone Diseases
Ascendis Pharma, Ophthalmology
Division A/S
Ascendis Pharma Oncology Division A/S
Ascendis Pharma Growth Disorders
Ascendis Pharma Endocrinology Division
Member of the board of directors in Ascendis
Pharma, Inc., Ascendis Pharma Endocrinology
Inc. and Ascendis Pharma Europe A/S
Mr. Fu Shan Non-Executive Director Joint chief executive officer and the Greater
China chief executive officer of Vivo Capital
LLC
Mr. Michael J. CHANG Non-Executive Director Managing partner of Vivo Capital LLC
RELATIONSHIP WITH THE CONTROLLING SHAREHOLDERS
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The Directors are of the view that the Board of Directors and the senior management of
the Group are able to function independently of the Controlling Shareholders and their close
associates for the following reasons:
 our CEO and Executive Director, Mr. LU An-bang, currently does not hold any
management positions in our Controlling Shareholders or any of their close
associates. Mr. Lu is responsible for overall development strategy and business
direction of our Group, as well as the day to day management of our Group’s
operations;
 more than half of the members of the Board, including Mr. LU An-bang, Mr. CAO
Yibo and all the independent non-executive Directors, will be entirely independent
of Controlling Shareholders; and the independent non-executive Directors will be
entitled to engage professional advisers at our cost for advice on matters relating to
any potential conflict of interest arising out of any transaction to be entered into
between our Company and our Directors or their respective associates;
 each of the overlapping Directors are non-executive Directors who does not
participate in the daily operation and management of our Company, and only
participates in the decision-making process for significant matters, such as our
operational strategy (subject to measures conflicts of interest to avoid and address
as described below);
 save as disclosed above, none of the members of the senior management of
Company (including our CEO, Chief Commercial Officer and Executive Advisor)
have any ongoing role with the Controlling Shareholders;
 should there be a potential conflict of interest or a connected transaction (as defined
under the Listing Rules) between the Company (on one hand) and Ascendis Pharma
or Vivo Capital (including the Vivo Funds) (on the other hand), the relevant
overlapping Directors from Ascendis Pharma or Vivo Capital (including the Vivo
Funds), will abstain from voting on the relevant board resolution(s) of the Company;
 each of our Directors is aware of his/her fiduciary duties and responsibilities under
the Listing Rules as a director, which require that he/she acts in the best interests of
our Company and our Shareholders as a whole; and
 we have adopted a series of corporate governance measures to manage conflicts of
interest, if any, between our Group and our Controlling Shareholders which would
support our independent management. Please see “– Corporate Governance
Measures” in this section for further information.
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CORPORATE GOVERNANCE MEASURES
We will comply with the provisions of the Corporate Governance Code set forth in
Appendix C1 to the Listing Rules, which sets out the principles of good corporate governance.
Our Directors believe that there are adequate corporate governance measures in place to
manage existing and potential conflicts of interest. In order to further avoid potential conflicts
of interest, we have implemented the following measures:
 where a board meeting or Shareholders’ meeting is to be held for considering
proposed transactions in which any of our Directors or Controlling Shareholders or
any of their respective close associates has a material interest, the relevant Director
or Controlling Shareholder will not vote on the relevant resolutions;
 we have established internal control mechanisms to identify connected transactions.
Upon the Listing, if we enter into connected transactions with any Controlling
Shareholder or any of their associates, we will comply with the applicable Listing
Rules;
 the independent non-executive Directors will review, on an annual basis, whether
there are any conflicts of interests between our Group and any Controlling
Shareholder (the “Annual Review”) and provide impartial and professional advice to
protect the interests of our minority Shareholders;
 our Controlling Shareholders will undertake to provide all information necessary,
including all relevant financial, operational and market information and any other
necessary information as required by the independent non-executive Directors for
the Annual Review;
 our Company will disclose decisions on matters reviewed by the independent
non-executive Directors either in its annual reports or by way of announcements;
 where our Directors reasonably request the advice of independent professionals,
such as financial advisors, the appointment of such independent professionals will
be made at our Company’s expenses; and
 we have appointed Somerley Capital Limited as our compliance advisor to provide
advice and guidance to us in respect of compliance with the applicable laws and
regulations, as well as the Listing Rules, including various requirements relating to
corporate governance.
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OVERVIEW
We set out below certain transactions with connected persons which will constitute
continuing connected transactions of our Group under Chapter 14A of the Listing Rules.
CONNECTED PERSONS
We have entered into and will continue to engage in certain transactions with the
following connected persons, which will constitute our continuing connected transactions upon
Listing:
Connected Person(s) Connected Relationship
Ascendis Pharma Endocrinology
Division
One of the Controlling Shareholders. Pursuant to
Rule 14A.07(1) of the Listing Rules, Ascendis
Pharma Endocrinology Division is a connected
person of our Company.
Ascendis Pharma Growth
Disorders
One of the Controlling Shareholders. Pursuant to
Rule 14A.07(1) of the Listing Rules, Ascendis
Pharma Growth Disorders is a connected person of
our Company.
Ascendis Pharma Bone Diseases One of the Controlling Shareholders. Pursuant to
Rule 14A.07(1) of the Listing Rules, Ascendis
Pharma Bone Diseases is a connected person of our
Company.
CONNECTED TRANSACTIONS
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--- page 392 ---
CONTINUING CONNECTED TRANSACTIONS
As the Company is a pre-revenue biopharmaceutical company, the revenue ratio is not
applicable. The assets ratio remains applicable and does not produce any anomalous result. As
an alternative to the revenue ratio and profit ratio, we have applied a percentage ratio test based
on the total amount of research and development costs and administrative expenses of our
Group.
Summary of Our Continuing Connected Transactions
No.
Nature of
Transactions
Relevant
Listing Rules
Connected
Person(s) Waiver Sought
Cost Sharing and V olume Commitment Agreement
1. Cost sharing and
volume commitment
Agreement with
Ascendis Pharma
Endocrinology
Division
14A.76 de
minimis
transactions
Ascendis Pharma
Endocrinology
Division
Not applicable
Exclusive License Agreements
1. License Agreement
with Ascendis
Pharma
Endocrinology
Division
(Lonapegsomatropin)
14A.34, 14A.35,
14A.36, 14A.52
and 14A.105
Ascendis Pharma
Endocrinology
Division
Requirements as to
announcement, circular,
independent shareholders’
approval and contract term
not exceeding three years
under Chapter 14A of the
Listing Rules
2. License Agreement
with Ascendis
Pharma Growth
Disorders
(TransCon CNP
(navepegritide))
14A.34, 14A.35,
14A.36, 14A.52
and 14A.105
Ascendis Pharma
Growth
Disorders
Requirements as to
announcement, circular,
independent shareholders’
approval and contract term
not exceeding three years
under Chapter 14A of the
Listing Rules
CONNECTED TRANSACTIONS
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--- page 393 ---
No.
Nature of
Transactions
Relevant
Listing Rules
Connected
Person(s) Waiver Sought
3. License Agreement
with Ascendis
Pharma Bone
Diseases
(palopegteriparatide)
14A.34, 14A.35,
14A.36, 14A.52
and 14A.105
Ascendis Pharma
Bone Diseases
Requirements as to
announcement, circular,
independent shareholders’
approval and contract term
not exceeding three years
under Chapter 14A of the
Listing Rules
Clinical Supply Agreements
1. Products supplied by
Ascendis Pharma
Endocrinology
Division
(Lonapegsomatropin)
14A.34, 14A.35,
14A.36 and
14A.105
Ascendis Pharma
Endocrinology
Division
Requirement as to
announcement under
Chapter 14A of the
Listing Rules
2. Products supplied by
Ascendis Pharma
Growth Disorders
(TransCon CNP
(navepegritide))
14A.34, 14A.35,
14A.36 and
14A.105
Ascendis Pharma
Growth
Disorders
Requirements as to
announcement under
Chapter 14A of the Listing
Rules
3. Products supplied by
Ascendis Pharma
Bone Diseases
(palopegteriparatide)
14A.34, 14A.35,
14A.36 and
14A.105
Ascendis Pharma
Bone Diseases
Requirements as to
announcement under
Chapter 14A of the Listing
Rules
Commercial Supply Agreement
Commercial Supply
Agreement
14A.34, 14A.35,
14A.36 and
14A.105
Ascendis Pharma
Endocrinology
Division
Requirements as to
announcement, circular,
independent shareholders’
approval under Chapter
14A of the Listing Rules
CONNECTED TRANSACTIONS
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--- page 394 ---
FULLY EXEMPT CONTINUING CONNECTED TRANSACTION
Cost Sharing and Volume Commitment Agreement
Principal terms
Ascendis Pharma A/S has entered into a tech transfer and manufacturing services
agreement (“Agreement”) in 2019 with a Swiss contract development and manufacturing
organization which is capable of producing drug substances in large scale, which is an
Independent Third Party (the “Overseas CDMO B”) regarding the supply of lonapegsomatropin
drug substance, and has been engaged in a scale up project (the “Scale-up Project”) with
Overseas CDMO B regarding lonapegsomatropin drug substance production capacity for the
years 2022-2026 inclusive. When Ascendis Pharma A/S entered into the Tech Transfer
Agreement with Overseas CDMO B in 2019, it was contemplated that the Scale-up Project
would be completed in 2023. Once the Scale-up Project is completed, certain capacity will be
made available to Ascendis Pharma Endocrinology Division by Overseas CDMO B until 2026
(“Ascendis Reserved Capacity”).
On December 14, 2021, our Company entered into the cost sharing and volume
commitment agreement (the “Cost Sharing and V olume Commitment Agreement”) with
Ascendis Pharma Endocrinology Division. Pursuant to the Cost Sharing and V olume
Commitment Agreement, our Company will have the right to reserve from Ascendis Pharma
Endocrinology Division the volume of lonapegsomatropin drug substance that does not exceed
25% of the Ascendis Reserved Capacity until 2026, for future production of the Core Product
to be supplied by Ascendis Pharma Endocrinology Division. The Company agreed to pay
Ascendis Pharma Endocrinology Division an amount calculated as 25% of the costs incurred
by it in connection with the Scale-up Project, which mainly includes the cost of materials used
in the Scale-up Project, the payment made by Ascendis Pharma Endocrinology Division to
Overseas CDMO B for Ascendis Reserved Capacity (including the one-time technology
transfer fee) and the internal resources costs incurred by Ascendis Pharma Endocrinology
Division for the daily operation of the Scale-up Project. This arrangement ensures that the
Company will be able to access the lonapegsomatropin drug substance once the increased
production capacity resulting from the Scale-up Project becomes available.
The Company also obtained 25% ownership of the Pre-PPQ drug substance from
Ascendis Pharma Endocrinology Division under such agreement, which is a byproduct of the
Pre-PPQ stage of the manufacturing process. The purpose of the Pre-PPQ stage is to test and
validate the drug substance manufacturing process, and the resulting product is not intended for
commercial use. The Company intends to use the Pre-PPQ Drug Substance for both ongoing
and future R&D endeavors, including but not limited to that, (i) the Company have utilized the
Pre-PPQ Drug Substance in the in-house development of the dual chamber device (DCD)
technology in the form of prefilled syringe as a drug delivery system for the lonapegsomatropin
drug substance, which included testing various process conditions and parameters to create a
prototype for the local manufacturing; (ii) the Company will utilize the Pre-PPQ Drug
Substance to test analytical methods ensuring our capability to perform quality control on the
locally manufactured drug product, and (iii) the Company will utilized the Pre-PPQ Drug
Substance as reference samples in comparability studies of the locally manufactured drug
substance. These endeavors collectively will contribute to the establishment of the Company’s
CONNECTED TRANSACTIONS
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--- page 395 ---
local commercial manufacturing capability. The Pre-PPQ drug substance, valued at RMB56.5
million according to Ascendis Pharma Endocrinology Division’s invoice, represents 54% of the
total consideration paid by the Company to Ascendis Pharma Endocrinology Division under the
Cost Sharing and V olume Commitment Agreement.
The term of the Cost Sharing and V olume Commitment Agreement commenced on
December 14, 2021 and shall expire on December 31, 2026. A substantial part of the cost of
Scale-up Project has incurred in 2021. It is expected that beyond 2023, the Company would not
incur further costs under such cost sharing arrangement.
Pricing policy
The amount to be paid to Ascendis Pharma Endocrinology Division shall be determined
by 25% of the actual costs incurred by Ascendis Pharma Endocrinology Division for the
Scale-up Project (the “Project Costs”), which mainly comprise the cost of materials used in the
Scale-up Project, the payment made by Ascendis Pharma Endocrinology Division to Overseas
CDMO B for Ascendis Reserved Capacity (including the one-time technology transfer fee) and
the internal resources costs incurred by Ascendis Pharma Endocrinology Division for the daily
operation of the Scale-up Project. Ascendis Pharma Endocrinology Division shall on quarterly
basis submit to our Company a calculation of the Project Costs for the preceding financial
quarter. In addition, our Company has the right to engage external accounting firms to audit the
Project Costs and our payment under the cost sharing arrangement. If the audit reveals any
discrepancies that require adjustments, Ascendis Pharma Endocrinology Division shall
reimburse the Company for any overpayments, as detailed in the audit report. Our Company’s
total payment in connection with the Scale-up Project shall not exceed 25% of the total
estimated cost in the Cost Sharing and V olume Commitment Agreement without our
Company’s prior written consent.
Historical amounts
For the years ended December 31, 2022 and 2023, the amounts paid by the Group to
Ascendis Pharma Endocrinology Division under the cost sharing arrangement was
approximately RMB21.6 million and RMB8.5 million, respectively, with no payments made
for the nine months ended September 30, 2024.
Annual Caps
It is expected that no further costs will be incurred under such cost sharing arrangement
beyond 2023. As such, the estimated caps would be 0 for the three years ending December 31,
2026.
Listing Rules implications
The Cost Sharing and V olume Commitment Agreement is entered into in the ordinary and
usual course of business of our Group on normal commercial terms. The highest applicable
percentage ratio calculated for such transactions, is expected to be less than 0.1%. As such, this
transaction will be fully-exempt from the reporting, annual review, announcement and
independent shareholders’ approval requirements under Chapter 14A of the Listing Rules.
CONNECTED TRANSACTIONS
– 385 –


--- page 396 ---
NON-EXEMPT AND PARTIALLY-EXEMPT CONTINUING CONNECTED
TRANSACTIONS
Exclusive License Agreements
Principal terms
On November 7, 2018, our Company entered into three Exclusive License Agreements (as
amended on January 4, 2021) with Ascendis Pharma Endocrinology Division, Ascendis Pharma
Growth Disorders and Ascendis Pharma Bone Diseases (collectively, “Ascendis Subsidiaries”),
respectively. Pursuant to the Exclusive License Agreements, the Company obtained from
Ascendis Subsidiaries exclusive, royalty-free licenses under their applicable owned patents and
other intellectual property or technical information to develop, manufacture and commercialize
lonapegsomatropin with its auto-injector, TransCon CNP (navepegritide) with its injector and
palopegteriparatide with its injector (collectively, the “Licensed Products”), in China
(including Hong Kong, Macau and Taiwan) for use in the treatment and/or prevention of any
disease, condition or disorder of any human indication (subject to certain exceptions, including
diabetes (and certain related metabolic disorders), obesity and ophthalmology). The Company
also obtained a right of first negotiation to license from Ascendis Subsidiaries the rights to
develop or commercialize certain additional pharmaceutical products for the treatment of
endocrine disorders. Each of the Exclusive License Agreements became effective on November
7, 2018 and will remain in effect for an indefinite period until the expiration of the last valid
claim of a licensed patent in China (including Hong Kong, Macau and Taiwan) or an early
termination by either party. Each of the Exclusive License Agreements may be terminated by
either party for the other party’s uncured material breach or bankruptcy, by Ascendis
Subsidiaries for a change of control of the Company or if the Company or its affiliates
challenges (or assists a third party in challenging) in a court the validity, enforceability or
scope of certain patents and patent applications as specified in the Exclusive License
Agreements, unless some exceptions apply, or by the Company for convenience upon advanced
notice. The Company shall own all right, title and interest in and to any and all data, results,
improvements and inventions, in connection with the research, development, manufacturing, or
commercialization activities conducted with respect to the Licensed Products (the “Program
IP”), conceived or generated solely by employees, agents or service providers of the Company
and its affiliates, and the Company and Ascendis Subsidiaries (or their affiliates) shall each
own an undivided fifty percent (50%) rights, title and interest in and to any and all Program
IP conceived or generated during the course of, and in connection with each of the Exclusive
License Agreements by employees, agents or service providers of both parties.
As a one-time, non-refundable consideration of the rights and license granted by Ascendis
Subsidiaries under the respective Exclusive License Agreement, the Company issued to: (i)
Ascendis Pharma Endocrinology Division 20,000,000 Series A Preferred Shares corresponding
to a total value of US$20.0 million; (ii) Ascendis Pharma Growth Disorders 7,500,000 Series
A Preferred Shares corresponding to a total value of US$7.5 million; and (iii) Ascendis Pharma
Bone Diseases 12,500,000 Series A Preferred Shares corresponding to a total value of US$12.5
million. See “History, Development and Corporate Structure – Major Corporate Development
and Shareholding Changes of Our Group – Our Company – Series A Financing” for more
details.
CONNECTED TRANSACTIONS
– 386 –


--- page 397 ---
In August 2021, without compromising our exclusive rights and responsibilities for the
development and commercialization regarding TransCon CNP (navepegritide) in China
(including Hong Kong, Macau and Taiwan), our Company entered into a letter agreement with
Ascendis Pharma Growth Disorders to specify the roles and responsibilities between both
parties in anticipation of the upcoming China Phase 2 trial. Pursuant to this letter agreement,
the two companies will jointly conduct the China Phase 2 trial, with Ascendis Pharma Growth
Disorders acting as trial sponsor and us acting as the exclusive authorized agent. In November
2022, the two companies entered into an amendment to this letter agreement under which we
became the sole sponsor for the OLE period of the China Phase 2 trial to reflect the updated
roles and responsibilities between both parties as the sponsorship for the OLE period of China
Phase 2 trial was transferred from Ascendis Pharma to us (the letter agreement and the
subsequent amendment, collectively referred to as the “Letter Agreement”). Pursuant to the
Letter Agreement, we and Ascendis Subsidiaries shall reasonably cooperate and coordinate
with each other in the conduct of the China Phase 2 trial of TransCon CNP (navepegritide).
Subsequent to the entry of the foregoing amendment, we became the sole sponsor for the OLE
portion of the China Phase 2 trial as it commenced in January 2023.
Ascendis Subsidiaries’ Expenses Arrangement and Pricing Policy
Under the Exclusive License Agreements, the Company and Ascendis Subsidiaries agreed
to conduct certain R&D activities allocated to themselves respectively under a research and
technical development plan mutually agreed by the parties in accordance with the terms of the
Exclusive License Agreements (the “Research and Technical Development Plan”), and the
Company will pay or reimburse (as applicable) Ascendis Subsidiaries for the costs and
expenses actually incurred by Ascendis Subsidiaries in carrying out the research and technical
development activities as set out in the respective Research and Technical Development Plans
in connection with each of the Licensed Products (“Ascendis Subsidiaries’ Expenses”). The
Ascendis Subsidiaries’ Expenses comprise:
(i) the out-of-pocket cost incurred by Ascendis Subsidiaries of having any R&D
activities performed by approved service providers in accordance with the
applicable Research and Technical Development Plan;
(ii) Ascendis Subsidiaries’ FTE costs, which is determined based on the number of FTE
used by Ascendis Subsidiaries and the applicable FTE rate ranging from Euros
(
C200,000) to Euros ( C300,000) per FTE, depending on Ascendis Subsidiaries’
interests in the share capital of the Company, pursuant to the Exclusive License
Agreements; and
(iii) any other costs or expenses identified and included in the applicable Research and
Technical Development Plan.
CONNECTED TRANSACTIONS
– 387 –


--- page 398 ---
Under the Exclusive License Agreements, if our Company plans to manufacture the
Licensed Products (excluding Ascendis Subsidiaries’ proprietary linkers) in China (including
Hong Kong, Macau and Taiwan), the Company and Ascendis Subsidiaries will perform a
technology transfer of such know-how of Ascendis Subsidiaries necessary to permit the
Company to manufacture the Licensed Products in China (including Hong Kong, Macau and
Taiwan), in accordance with a technology transfer plan as mutually agreed by the parties. The
Company shall reimburse Ascendis Subsidiaries’ FTE costs, travel costs and costs of all
materials transferred in connection with the performance of the relevant Technology Transfer
and Localization. See “Business – Overview – CMC R&D and Local BLA for local
manufacturing” for more details regarding the latest status of the technology transfer.
In addition, the Company also pays Ascendis Subsidiaries at FTE rate for the assistance
as reasonably requested by us and provided by Ascendis Subsidiaries to support the obtaining
and maintenance of regulatory approvals of the Licensed Products in China (including Hong
Kong, Macau and Taiwan). Ascendis Subsidiaries designates an individual (the “Ascendis
Alliance Manager”) to ensure communication and alignment between Ascendis Subsidiaries
and our Company regarding activities carried out under the Exclusive License Agreements. Our
Company shall bear the cost for any additional services conducted by such Ascendis Alliance
Manager that is not otherwise reimbursed by our Company at the applicable FTE rate (the
“Ascendis Alliance Manager Expenses”), provided that the prior agreement of our Company
and Ascendis Subsidiaries on the scope of such additional services is required. During the
Track Record Period, the assistance we requested and received from Ascendis Subsidiaries
primarily included general and administrative support, as well as R&D consulting services,
mainly for the following activities: (i) for lonapegsomatropin, (a) the pharmacovigilance and
biometry for data analysis including statistical programming and statistical analysis, and (b)
the regulatory strategy advice and documentation support to prepare for our Import BLA
submission package with the NMPA; (ii) for TransCon CNP (navepegritide) and
palopegteriparatide, the pharmacovigilance and biometry for data analysis including statistical
programming and statistical analysis. In connection with our expected R&D and regulatory
activities of three drug candidates, we expect to procure R&D consulting services from
Ascendis Pharma mainly for the following activities: (i) for lonapegsomatropin, (a) the
technology transfer of lonapegsomatropin drug substance from Ascendis Pharma to us, and (b)
consulting the technology localization process that involves the lonapegsomatropin drug
substance manufacturing scale-up; (ii) for TransCon CNP (navepegritide) and
palopegteriparatide, the support of data programming and statistical analysis, and the
regulatory strategy advice and documentation support in connection with our expected NDA
with the NMPA.
The applicable FTE rate under the Exclusive License Agreements was determined based
on our arms’ length negotiation with Ascendis Subsidiaries, and consistent with the market rate
charged by personnel with similar seniority and experience.
CONNECTED TRANSACTIONS
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--- page 399 ---
In addition, we and Ascendis Subsidiaries shall be responsible for the portion of the costs
incurred in connection with the conduct of the China Phase 2 trial of TransCon CNP
(navepegritide) based on the allocation as set forth in the Letter Agreement, and among others,
Ascendis Subsidiaries shall be responsible for the costs for investigational medicinal products,
while we will reimburse Ascendis Subsidiaries for the packing, labeling and shipment to China
related to investigational medicinal products.
Subject to the terms of the Exclusive License Agreements and the Letter Agreement, our
Group may enter into specific agreements with Ascendis Subsidiaries to set out specific terms
and conditions in relation to various matters under the Exclusive License Agreements,
including but not limited to commercial supply, FTE costs, supplies for regulatory filing, etc.
For further details of the Exclusive License Agreements, please see “Business –
Collaborations – Exclusive License Agreements with Ascendis Pharma.”
Reasons for and benefits of the transactions
As the Company is a clinical stage biopharmaceutical company, the licenses granted by
Ascendis Subsidiaries are essential to our R&D process as they provide us with the exclusive
rights to develop, manufacture and commercialize the Licensed Products, which have been
validated in the global development programs conducted by Ascendis Subsidiaries. The
licensing arrangement also enables us to utilize the know-how, data, materials and other
information relating to the global clinical trials conducted by Ascendis Subsidiaries to optimize
the design of our clinical trials in China (including Hong Kong, Macau and Taiwan). The
continuous communication with and ongoing support from Ascendis Subsidiaries would also
benefit our R&D activities.
Historical amounts
The following table sets forth historical transaction amounts incurred by the Group in
connection with the disbursement arrangement under the respective Exclusive License
Agreement with respect to each of the Licensed Products for the Track Record Period:
Y ear Ended December 31
Nine months
ended
September 30
2022 2023 2024
RMB’000 RMB’000 RMB’000
FTE costs
Lonapegsomatropin 8,566 8,112 6,308
TransCon CNP (navepegritide) 440 3,059 6,253
Palopegteriparatide 1,320 895 98
Sub-total 10,326 12,066 12,659
Other (1)
Lonapegsomatropin 33,367 1,149 380
Sub-total 33,367 1,149 380
Total 43,693 13,215 13,039
(1) Relates to supplies for regulatory filing, i.e. purchasing of QC testing samples.
CONNECTED TRANSACTIONS
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--- page 400 ---
Annual caps
The following table sets out our estimated caps for the disbursement arrangement under
the respective Exclusive License Agreement with respect to each of the Licensed Products for
the three years ending December 31, 2026:
Y ear Ended December 31
2024 2025 2026
RMB’000 RMB’000 RMB’000
FTE Costs
Lonapegsomatropin 15,543 12,214 7,948
TransCon CNP (navepegritide) 9,060 6,805 5,300
Palopegteriparatide 136 5,202 9,800
Sub-total 24,739 24,221 23,048
Other (1)
Lonapegsomatropin (2) 5,074 17,777 –
TransCon CNP (navepegritide) –––
Palopegteriparatide – 2,403 600
Sub-total 5,074 20,180 600
Total 29,813 44,401 23,648
(1) Relates to supplies for regulatory filing and materials for Technology Transfer and Localization purpose
(2) Under the Exclusive License Agreement, we have established the preliminary framework for a purchase
agreement concerning materials intended for Technology Transfer and Localization upon the successful
completion of the Global Offering. Currently, only initial arrangements have been made under this
framework, with no additional actions taken at this stage. Following the completion of the Global
Offering and subsequent negotiations between both parties, the Company plans to acquire the necessary
materials for the Technology Transfer and Localization under this purchase agreement in the manner as
disclosed in “Future Plans and Use of Proceeds.”
Basis of cap
In arriving at the above annual caps, we have considered the following factors:
(i) the historical amounts of the Ascendis Subsidiaries’ Expenses paid by our Group to
Ascendis Subsidiaries under the respective Research and Technical Development
Plan in respect of each Licensed Product;
(ii) the number of FTE expected to be used by Ascendis Subsidiaries to perform the
activities under the respective Research and Technical Development Plan and by the
Ascendis Alliance Manager to support our regulatory approvals including but not
limited to, gathering global regulatory files, coordinating the required
documentation from CDMOs for the NMPA, conducting a gap analysis of clinical
data and comparing China-specific clinical data with global clinical data, reviewing
and providing advisory services on CSR, offering CMC technical consulting related
to product specifications for China and offering CMC technical consulting related to
the drug tests mandated by the NMPA, which is commensurate with the development
and regulatory submission status of each Licensed Product;
CONNECTED TRANSACTIONS
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--- page 401 ---
(iii) the expenses to be incurred in connection with the product registration testing
associated with the verification of lonapegsomatropin to support our BLA filing to
the NMPA for the treatment of PGHD which was accepted by the NMPA on March
7, 2024. In connection with such filing, we expect to incur a substantial amount of
expenses that relate to (x) product QC testing, which mainly includes the provision
of sampling products, the provision of testing services, expenses in connection with
the regulatory registration of pharmaceutical excipients and packaging materials,
and technical support in relation to the registration process; and (y) regulatory
registration of medical device, which mainly relates to the document preparation and
testing of medical device. We also expect to incur expenses in 2024, 2025 and 2026
relating to consulting service in connection with the indication expansion of
lonapegsomatropin and the local production project of lonapegsomatropin.
Furthermore, considering the Company’s upcoming Technology Transfer and
Localization from Ascendis Pharma, it is anticipated that there will be expenses
incurred for the procurement of materials required for this project in 2024 and 2025
under the purchase agreement framework upon the successful completion of the
Global Offering;
(iv) the expenses to be incurred in connection with the development and regulatory filing
of TransCon CNP (navepegritide) in China. Specifically, we expect to incur a
substantial amount of expense in 2025 and 2026 related to certain activities, namely
(a) pharmacovigilance and biometry for data analysis, which includes statistical
programming and analysis, and (b) regulatory strategy advice and documentation
support in connection with our anticipated NDA submission to the NMPA;
(v) the expenses to be incurred in connection with the development and regulatory filing
of palopegteriparatide in China. Specifically, we expect to file a NDA with the
NMPA for palopegteriparatide in 2025. In connection with such filing, we expect to
incur a substantial amount of expenses in 2025 and 2026, which will be similar in
nature as items (x) and (y) in paragraph (iii) above; and
(vi) among the expenses mentioned in paragraph (iii), testing services and technical
support would be charged at the applicable FTE rate, and the supplies for the
regulatory filing purpose and Technical Transfer purpose will be charged at a price
equal to Ascendis Subsidiaries’ fully-burdened cost.
Listing Rules implications
Pursuant to Rules 14A.81 to 14A.83 of the Listing Rules, the transactions (i.e., the
disbursement arrangement) under the Exclusive License Agreements should be aggregated. The
Exclusive License Agreements are entered into in the ordinary and usual course of business of
our Group on normal commercial terms, and the highest applicable percentage ratio calculated
for such transactions, on an aggregate basis, is expected to be more than 5% on an annual basis.
As such, these transactions will be subject to the reporting, annual review, announcement and
independent shareholders’ approval requirements under Chapter 14A of the Listing Rules.
CONNECTED TRANSACTIONS
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Waiver from strict compliance with contractual term requirements
Under Rule 14A.52 of the Listing Rules, a listed issuer is required to set a contractual
term not exceeding three years. It is impracticable and difficult for us to set a contractual term
not exceeding three years in respect of the Exclusive License Agreements. Therefore, the
Company applied to the Stock Exchange for, and the Stock Exchange has granted to the
Company, a waiver under Rule 14A.52 of the Listing Rules from strict compliance with the
contractual term requirements for the following reasons:
(i) it is impractical and difficult for the Company to set a term of not exceeding three
years in respect of the Exclusive License Agreements, as each of the Licensed
Products has a product life cycle of more than three years from its development
stage since in-licensing to commercialization;
(ii) the indefinite term of the Exclusive License Agreements can secure long-term,
exclusive cooperative relationship with Ascendis Pharma, which provides strategic
benefits for us to engage in development, manufacturing and commercialization of
the Licensed Products in China (including Hong Kong, Macau and Taiwan). In
addition, the exclusive term to cooperate with Ascendis Pharma safeguards the
interests of our Company and Shareholders as a whole by providing our Company
with relevant exclusivity in the relevant area of business;
(iii) If the Exclusive License Agreements are subject to renewal every three years, we
may face the unnecessary and substantial risks of failing to renew such agreement
upon expiry and bringing disruptions to the development, manufacturing and
commercialization of the Licensed Products, and losing our competitive advantages.
This may even prevent us from carrying on our business, bringing uncertainty to our
continued operation; and
(iv) our Directors consider that the terms of the Exclusive License Agreements are
consistent with normal business practices for agreements of a similar nature in the
biotechnology industry and are in the best interest of our Group and our
Shareholders as a whole, because (x) the indefinite term of the Exclusive License
Agreement can secure long-term license rights for us, thus avoiding unnecessary
disruptions to our business and enable long-term development and continuity of our
operations; and (y) as confirmed by Frost & Sullivan, it is common in the
biotechnology industry where similar long-term licensing arrangement are adopted.
Based on the above, the Directors are of the view that it is normal business practice for
agreements of this type to be of an indefinite term. Based on the aforementioned, the Joint
Sponsors agree with the Directors’ view and concur that it is consistent with normal business
practice for the Exclusive License Agreements to have an indefinite term.
CONNECTED TRANSACTIONS
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--- page 403 ---
Clinical Supply Agreements
Principal terms
On November 7, 2018, concurrently with the execution of the Exclusive License
Agreements, our Company entered into three clinical supply agreements (as amended on
August 20, 2021) (the “Clinical Supply Agreements”, each a “Clinical Supply Agreement”)
with Ascendis Pharma Endocrinology Division, Ascendis Pharma Growth Disorders and
Ascendis Pharma Bone Diseases with respect to each of Licensed Products, respectively.
Pursuant to the respective Clinical Supply Agreement, for use in conducting clinical trials in
China (including Hong Kong, Macau and Taiwan), we agreed to procure from:
(1) Ascendis Pharma Endocrinology Division, the lonapegsomatropin drug products and
the auto-injector;
(2) Ascendis Pharma Growth Disorders, the TransCon CNP (navepegritide) drug
products; and
(3) Ascendis Pharma Bone Diseases, the palopegteriparatide drug products and the
injector.
Each Clinical Supply Agreement is effective from the date of the agreement and will
remain in effect until its termination. Each of the Clinical Supply Agreements may be
terminated by: (x) mutual consent of the parties, (y) either party in the event of the other party’s
bankruptcy, insolvency, assignment for the benefit of creditors, or uncured material breach or
(z) by the Company for convenience upon advanced notice. Each Clinical Supply Agreement
will also immediately terminate when the corresponding Exclusive License Agreement is
terminated. It is expected that no further amounts will be incurred under the Clinical Supply
Agreement after December 31, 2025. As such, the Clinical Supply Agreements would be
terminated upon mutual consent following the final delivery of products thereunder.
As a supplement to the Clinical Supply Agreements, on June 15, 2021, our Group,
Ascendis Pharma A/S and Ascendis Subsidiaries entered into a quality agreement, which
specifies the roles and responsibilities of our Group and Ascendis Pharma with respect to the
manufacturing, handling, storage and distribution of Licensed Products used in clinical trials.
Pricing policy
The purchase prices of the Licensed Products under each Clinical Supply Agreement (the
“Clinical Supply Price”) shall be equal to Ascendis Subsidiaries’ fully-burdened cost for
supplying the Licensed Products (including the costs of purchasing from third-party suppliers
and Ascendis Subsidiaries’ internal overhead costs attributed to products purchased by the
Company), subject to price adjustments which may be required to comply with transfer pricing
requirements actually issued by relevant taxing authorities in applicable jurisdictions with
respect to the relevant Licensed Products.
CONNECTED TRANSACTIONS
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Reasons for and benefits of the transactions
Ascendis Pharma A/S is applying its platform technology to build a leading, fully
integrated, global biopharmaceutical company focused on making a meaningful difference in
patients’ lives. Our pipeline products are developed based on the rights we in-licensed from
Ascendis Subsidiaries. The products required for our clinical trials in China (including Hong
Kong, Macau and Taiwan), and those required in Ascendis Subsidiaries’ global clinical trials,
share similar characteristics and requirements. A stable supply of products for use in clinical
trials is of crucial importance to our business. The Directors are of the view that Ascendis
Subsidiaries has been providing the Group with high quality and stable supply of the products
for use in clinical trials during the Track Record Period, and it will be in the interests of our
Group to continue procuring clinical supplies from Ascendis Subsidiaries.
Historical amounts
The following table sets forth historical transaction amounts paid by the Group to
Ascendis Subsidiaries under the respective Clinical Supply Agreement with respect to each of
the Licensed Products for the Track Record Period:
Y ear Ended December 31
Nine months
ended
September 30
2022 2023 2024
RMB’000 RMB’000 RMB’000
Lonapegsomatropin –– –
TransCon CNP (navepegritide) 714 243 –
Palopegteriparatide 5,256 451 3,310
Total 5,970 694 3,310
Pursuant to the letter agreement entered into between Ascendis Subsidiaries and our
Company in August 2021 with respect to the China Phase 2 trial, Ascendis Subsidiaries would
be responsible for the costs and expenses in connection with the clinical supply for the China
Phase 2 trial (including the expenses for transporting the investigational medicinal products
from Ascendis Subsidiaries to our Company then to the clinical sites). In November 2022, we
and Ascendis Subsidiaries entered into an amendment to this letter agreement, pursuant to
which we became the sole sponsor for the OLE period of the China Phase 2 trial and we and
Ascendis Subsidiaries shall reasonably cooperate and coordinate with each other in the conduct
of the China Phase 2 trial. Subsequent to the entry of the foregoing amendment, we became the
sole sponsor for the OLE portion of the China Phase 2 trial as it commenced in January 2023.
As such, we incurred such reimbursement amounts for TransCon CNP (navepegritide) in 2022
and 2023.
CONNECTED TRANSACTIONS
– 394 –


--- page 405 ---
Annual caps
The following table sets out our estimated caps for the aggregate Clinical Supply Price
under the respective Clinical Supply Agreement with respect to each of the Licensed Products
for the three years ending December 31, 2026:
Y ear Ended December 31
2024 2025 2026
RMB’000 RMB’000 RMB’000
Lonapegsomatropin –––
TransCon CNP (navepegritide) –––
Palopegteriparatide 3,310 1,191 –
Total 3,310 1,191 –
Basis of cap
In arriving at the above annual caps, we have considered the following factors:
(i) the historical transaction amounts paid by our Group to Ascendis Subsidiaries under
the respective Clinical Supply Agreement;
(ii) the estimated costs to be incurred by Ascendis Subsidiaries for supplying the
products to our Group including, among which, the estimated market price of
materials which Ascendis Subsidiaries would procure from third-party suppliers for
supplying such products; and
(iii) the anticipated amounts of products for the use in clinical trial programs of
palopegteriparatide in 2024, 2025 and 2026, that is commensurate with the
development status of these drug candidates. As the Company plans to use the PPQ
samples produced by the local CDMO for the purpose of indication expansion, it is
expected that no amounts would be incurred with respect to Lonapegsomatropin for
the years ended December 31, 2024, 2025 and 2026. As the clinical supplies for the
current China Phase 2 trial has been procured in 2023, it is expected that no amounts
would be incurred with respect to TransCon CNP (navepegritide) for the years ended
December 31, 2024, 2025 and 2026. It is expected that no further amounts will be
incurred under the Clinical Supply Agreement after December 31, 2025.
Listing Rules Implications
Pursuant to Rules 14A.81 to 14A.83 of the Listing Rules, the transactions under the
Clinical Supply Agreements shall be aggregated. The transactions contemplated under the
Clinical Supply Agreements are conducted in the ordinary and usual course of business on
normal commercial terms and the highest applicable percentage ratio calculated for such
transactions, on an aggregate basis, is expected to be more than 0.1% but less than 5% on an
annual basis. As such, these transactions will be exempted from the independent shareholders’
approval requirements and would require compliance with the reporting and announcement
requirements and annual review requirements under Chapter 14A of the Listing Rules.
CONNECTED TRANSACTIONS
– 395 –


--- page 406 ---
Commercial Supply Agreement
Principal terms
On October 23, 2023, our Company entered into a commercial supply agreement (the
“Commercial Supply Agreement”) with Ascendis Pharma Endocrinology Division, pursuant to
which the Company agreed to purchase, and Ascendis Pharma Endocrinology Division agreed
to sell, lonapegsomatropin drug packages (the “Drug Packages”), some additional product
items intended for display purposes during marketing events (the “Demo Product”) and the
auto-injectors (the “Auto-Injectors”). Upon receiving instructions from the Company to
manufacture the relevant products, Ascendis Pharma Endocrinology Division will proceed with
the manufacturing process and deliver the relevant products to the Company. In line with the
planned commercialization process of our Core Product, the transaction contemplated
hereunder would be completed in 2026. For further details of the commercialization of our
Core Product, please refer to the section headed “Business – Commercial Supply and
Manufacturing.”
Pricing policy
The price to be paid for the Drug Packages and the Demo Product will be the
manufacturing costs that may be incurred by Ascendis Pharma Endocrinology Division plus an
additional 20% mark up. As advised by Frost & Sullivan, the pricing structure of the Drug
Packages and the Demo Product adheres to industry standards. The estimated total purchase
price of the Drug Packages is RMB64.0 million (EUR8.1 million) and the estimated total
purchase price of the Demo Product is RMB0.7 million (EUR0.08 million). Pursuant to the
Commercial Supply Agreement, within 14 calendar days upon receiving the invoice from
Ascendis Pharma Endocrinology Division after signing the Commercial Supply Agreement, the
Company must pay Ascendis Pharma Endocrinology Division a non-refundable pre-payment of
RMB39.2 million (EUR5.0 million) for manufacturing costs and commitments related to Drug
Packages. For the Demo Product, when the Company instructs Ascendis Pharma Endocrinology
Division to manufacture such products, the Company shall pay Ascendis Pharma
Endocrinology Division a non-refundable prepayment equal to 50% of the estimate price of the
relevant Demo Product upon receipt of the corresponding invoice from Ascendis Pharma
Endocrinology Division and shall pay the rest 50% of the estimate price upon receipt of the
corresponding invoice from Ascendis Pharma Endocrinology Division 40 calendar days prior
to the expected delivery of the Demo Product.
A pre-payment of RMB39.2 million (EUR5.0 million) was made by the Company for the
Drug Packages in November 2023. The remaining purchase price of the Drug Packages will be
paid in two installments: (i) upon the Company’s notification to Ascendis Pharma
Endocrinology Division instructing them to manufacture the Drug Packages, the Company will
pay RMB4.0 million (EUR0.5 million) to Ascendis Pharma Endocrinology Division; (ii) prior
to the final delivery of the Drug Packages, the Company will pay Ascendis Pharma
Endocrinology Division RMB20.8 million (EUR2.6 million) upon receiving the relevant
invoices from Ascendis Pharma Endocrinology Division. No payment has been made for the
Demo Product by the Company to Ascendis Pharma Endocrinology Division as of the Latest
Practicable Date. It is anticipated that the Drug Packages will be produced in 2025 to meet the
initial market demand for our products. To ensure flexibility in responding to potential future
market fluctuations and production demands, recently, the Company entered into an
amendment of the Commercial Supply Agreement with Ascendis Pharma Endocrinology
Division (the “Amendment”). Under the Amendment, both parties agreed that if the Drug
Packages were not produced in 2025 and there is a need to adjust the production schedule, the
Company shall pay Ascendis Pharma Endocrinology Division RMB9.9 million (EUR1.3
million) as a non-refundable payment for such adjustment.
CONNECTED TRANSACTIONS
– 396 –


--- page 407 ---
The amount to be paid to Ascendis Pharma Endocrinology Division for the Auto-Injectors
shall be determined by the manufacturing costs incurred by Ascendis Pharma Endocrinology
Division plus an additional 20% mark up for the Auto-Injectors. The fees for each batch of the
Auto-Injectors will be settled in the way below: (i) within 30 days of the Company’s
notification to Ascendis Pharma Endocrinology Division instructing Ascendis Pharma
Endocrinology Division to manufacture the requested amount of the Auto-Injectors and the
receipt of the corresponding invoice from Ascendis Pharma Endocrinology Division, the
Company shall pay Ascendis Pharma Endocrinology Division a non-refundable pre-payment of
50% of the estimate price per each item; (ii) upon confirming of the expected delivery date and
receiving the receipt of Ascendis Pharma Endocrinology Division’s estimated total purchase
price for the requested amount of the Auto-Injectors, the Company shall make the rest payment
to Ascendis Pharma Endocrinology Division within 30 days upon receipt of the invoice from
Ascendis Pharma Endocrinology Division.
The Commercial Supply Agreement contains a true-up clause, pursuant to which Ascendis
Pharma Endocrinology Division will notify the Company of the final total purchase price 180
days after the final delivery of the products. If the final total purchase price surpasses the
payments made by the Company, the Company will transfer the remaining amount to Ascendis
Pharma Endocrinology Division within 30 days. If the payments made by the Company exceed
the final total purchase price, Ascendis Pharma Endocrinology Division will reimburse the
excess amount to the Company within 30 days. Our Company has the right to engage external
accounting firms to audit the purchase price and our payment for the products under the
Commercial Supply Agreement.
The consideration was determined after arm’s length negotiations between us and
Ascendis Pharma Endocrinology Division, taking into account various factors including but
not limited to (i) the manufacturing costs; (ii) the reasonable profit margin, among others. The
Company have performed the following to form the basis of determining the consideration: (i)
conducted market research to analyze pricing trends; (ii) examined the pricing strategies
employed by similar products in the industry; (iii) analyzed the profit margins of comparable
products in the market; (iv) considered the prevailing market conditions and economic factors.
Having considered the above, the Company is of the view that the consideration is fair and
reasonable.
Reasons for and benefits of the transactions
Entering into the Commercial Supply Agreement with Ascendis Pharma Endocrinology
Division ensures a consistent and reliable supply of lonapegsomatropin drug packages. This is
crucial for meeting the initial market demand for our lonapegsomatropin products and
guaranteeing continuous access for our patients and healthcare providers. By securing this
stable supply chain, we can better manage our inventory and plan more effectively for future
growth and market expansion, paving the way for our collaborative local manufacturing with
Local CDMO.
CONNECTED TRANSACTIONS
– 397 –


--- page 408 ---
Historical amounts
No delivery has been made by Ascendis Pharma Endocrinology Division under the
Commercial Supply Agreement during the Track Record Period.
Annual Caps
The following table sets out our estimated caps for the Commercial Supply Agreement for
the three years ending December 31, 2026:
Y ear Ended December 31,
2024 2025 2026
RMB’000 RMB’000 RMB’000
Drug Package and Demo Product
Purchase – 76,461 (1) –
Auto-Injectors Purchase – 1,000 4,000
Note:
(1) The amount includes a pre-payment of RMB39.2 million (EUR5.0 million) made by the Company in
2023 for the purchase of the Drug Packages.
Basis of Cap
In arriving at the above annual caps, we have considered the payment and delivery
schedule under the Commercial Supply Agreement as detailed in the paragraph “Pricing
Policy” above. Anticipating the receipt of the BLA approval for our Core Product for PGHD
in China in 2025, to fulfill the initial market demands for our Core Product, most of the
transaction amounts for the purchase of Drug Package and Demo Product would be incurred
in 2025. We have also included an additional buffer, calculated as a certain percentage increase,
to provide operational flexibility and accommodate potential growth in demand for the Core
Product, as well as to account for fluctuations in the exchange rate between the RMB and USD.
Listing Rules implications
The Commercial Supply Agreement is entered into in the ordinary and usual course of
business of our Group on normal commercial terms, and the highest applicable percentage ratio
calculated for such transactions is expected to be more than 5% on an annual basis. As such,
these transactions will be subject to the reporting, annual review, announcement and
independent shareholders’ approval requirements under Chapter 14A of the Listing Rules.
CONNECTED TRANSACTIONS
– 398 –


--- page 409 ---
W AIVER APPLICATION FOR THE EXCLUSIVE LICENSE AGREEMENTS, THE
CLINICAL SUPPLY AGREEMENTS AND THE COMMERCIAL SUPPLY
AGREEMENT
We expect the transactions contemplated under the Exclusive License Agreements, the
Clinical Supply Agreements and the Commercial Supply Agreement, as disclosed above will
be carried out on a continuing basis and will extend over a period of time, and our Directors
consider that strict compliance with the announcement, circular and/or independent
shareholders’ approval (as applicable) requirements under the Listing Rules would be
impractical, unduly burdensome and would impose unnecessary administrative costs on our
Company.
Accordingly, we have applied to the Stock Exchange for, and the Stock Exchange has
granted, a waiver to us under Rule 14A.105 of the Listing Rules from compliance with the
announcement, circular and/or independent shareholders’ approval requirements (if applicable)
in respect of the Exclusive License Agreements, the Clinical Supply Agreements and the
Commercial Supply Agreement.
In addition, our Directors confirm that we will comply with the applicable requirements
under Chapter 14A of the Listing Rules and will immediately inform the Stock Exchange if any
of the proposed annual caps set out above are exceeded, or when there is a material change in
the terms of the transactions. In the event of any future amendments to the Listing Rules
imposing more stringent requirements than those applicable as of the Latest Practicable Date
on the continuing connected transaction referred to in this prospectus, our Company will take
immediate steps to ensure compliance with such new requirements within a reasonable time.
DIRECTORS’ CONFIRMATION
Our Directors (including independent non-executive Directors) are of the view that (1) the
continuing connected transactions as disclosed in this section have been and will be entered
into in the ordinary and usual course of business on normal commercial terms which are fair
and reasonable and in the interests of our Company and our Shareholders as a whole; (2) the
terms of the Exclusive License Agreements are considered normal business practice for
agreements of their types; and (3) the proposed monetary annual caps in respect of these
continuing connected transactions are fair and reasonable and in the interests of our Company
and our Shareholders as a whole.
JOINT SPONSORS’ CONFIRMATION
Based on the documentation and data provided by the Company and the Joint Sponsors’
participation in the due diligence and discussions with both the management of the Company
and the representatives from Ascendis Pharma, the Joint Sponsors are of the view that (i) the
non-exempt and partially-exempt continuing connected transactions set out above have been
entered into in the ordinary and usual course of business of the Group on normal commercial
terms, which are fair and reasonable and in the interests of the Company and the Shareholders
as a whole; (ii) the terms of the Exclusive License Agreements are considered normal business
practice for agreements of their types; and (iii) the proposed annual caps for the non-exempt
continuing connected transactions as described above are fair and reasonable and in the
interests of the Shareholders as a whole.
CONNECTED TRANSACTIONS
– 399 –


--- page 410 ---
BOARD OF DIRECTORS
Our Board comprises nine Directors, including one executive Director, five non-executive
Directors and three independent non-executive Directors.
The following table sets out information in respect of our Directors:
Name Age Position
Date of
joining our
Group
Date of
appointment
as Director
Roles and
responsibilities
Mr. Michael Wolff
JENSEN
53 Chairman of
the Board,
Non-Executive
Director
January 8,
2021
January 8,
2021
Providing overall
guidance on
strategic planning,
business direction
and management
of the Company
Mr. Jan Møller
MIKKELSEN
65 Non-Executive
Director
November 7,
2018
November 7,
2018
Participating in
formulating the
Company’s
corporate and
business strategies
Mr. FU Shan ( ˹ʆ) 56 Non-Executive
Director
November 1,
2018
November 1,
2018
Participating in
formulating the
Company’s
corporate and
business strategies
Mr. LU An-bang
(ጅτԞ)
57 Executive Director,
Chief Executive
Officer
November 7,
2018
November 7,
2018
Overall strategic
planning, business
direction and day-
to-day operational
management of the
Company
Mr. Michael J.
CHANG
41 Non-Executive
Director
December 1,
2023
December 1,
2023
Participating in
formulating the
Company’s
corporate and
business strategies
Mr. CAO Yibo
(૎ʏ௹)
41 Non-Executive
Director
January 8,
2021
January 8,
2021
Participating in
formulating the
Company’s
corporate and
business strategies
DIRECTORS AND SENIOR MANAGEMENT
– 400 –


--- page 411 ---
Name Age Position
Date of
joining our
Group
Date of
appointment
as Director
Roles and
responsibilities
Dr. Y AO Zhengbin
(Bing)
58 Independent non-
executive
Director
April 1, 2021 April 1, 2021 Supervising and
providing
independent
judgment to our
Board
Mr. CHAN Peng
Kuan
(ඓ)
61 Independent non-
executive
Director
April 1, 2021 April 1, 2021 Supervising and
providing
independent
judgment to our
Board
Ms. NI Hong (ࠀࡎ52 Independent non-
executive
Director
April 1, 2021 April 1, 2021 Supervising and
providing
independent
judgment to our
Board
Executive Director
Mr. LU An-bang ( ጅτԞ), aged 57, was appointed as a Director and Chief Executive
Officer of the Company on November 7, 2018. He was re-designated as an Executive Director
on March 27, 2021. Mr. Lu is responsible for the overall strategic planning, business direction
and day-to-day operational management of the Company. He has been the director of VISEN
Shanghai since February 2019, the director of VISEN HK since October 2019, the director of
VISEN BVI since November 2020, and the director of VISEN Suzhou since June 2021.
Mr. Lu has over 31 years of experience in global biopharmaceutical development with a
proven track record of commercialization and operational success in China. Prior to joining our
Group, Mr. Lu worked at Takeda Pharmaceutical Company Limited, where he served as the
general manager, president and the head of greater China consecutively from October 2010 to
September 2017. Prior to Takeda, Mr. Lu worked at Servier from September 1994 to September
2010, among which, during May 2006 to September 2010, Mr. Lu served as the general
manager of Servier (Tianjin), mainly responsible for the overall development of Mainland
China or PRC.
Mr. Lu obtained his Bachelor’s degree in Pharmacy from Taipei Medical University in
June 1989. He received his pharmacist certificate in October 1989 and Pharmacist Civil
Servant Examination Certificate from the Examination Y uan of Taiwan in April 1990.
DIRECTORS AND SENIOR MANAGEMENT
– 401 –


--- page 412 ---
Non-Executive Directors
Mr. Michael Wolff JENSEN , aged 53, was appointed as a Director and the Chairman of
the Board of our Company on January 8, 2021. He was re-designated as a non-executive
Director on March 27, 2021. Mr. Jensen is responsible for providing overall guidance on
strategic planning, business direction and management of the Company. He has been the
director of VISEN BVI and the director of VISEN HK since February 2021, the director of
VISEN Shanghai since May 2021, the director of VISEN Suzhou since June 2021, and the
director of VISEN Taiwan since December 2021.
Mr. Jensen currently works at Ascendis Pharma A/S, a company listed on Nasdaq (stock
code: ASND) and has served as the senior vice president from 2013 to 2023, the executive vice
president since 2023, the chief legal officer since June 2013 and the chairman of the board of
directors from January 2008 to May 2021. From 2013 to May 2021, he served as the chairman
of the board of directors of XSpray Pharma AB, a company listed on Nasdaq Stockholm AB
(stock code: XSPRAY). Mr. Jensen served as chairman of a Danish private sports
manufacturing goods company from November 2016 to June 2019. He has served as the
chairman of the board of directors of Vicore Pharma Holding AB, a company listed on Nasdaq
Stockholm AB (stock code: VICO) from May 2020 to March 2022.
From December 2011 to June 2019, Mr. Jensen served as a board member and the
chairman of the board of directors of Eurocine V accines AB, a company listed on Spotlight
Stock Market (stock code: EUCI). From October 2010 to June 2013, Mr. Jensen served as
senior legal adviser and the head of partnerships in France office for the renewable business
division of Ørsted A/S (formerly known as Dong Energy A/S), a company listed on the
NASDAQ OMX Copenhagen (stock code: CPH). From 2003 to 2008, he served as executive
vice president and chief financial officer of LifeCycle Pharma A/S, now V eloxis
Pharmaceuticals A/S, a company formerly listed on the NASDAQ OMX Copenhagen (stock
code: VELO) until January 2020. Prior to joining V eloxis Pharmaceuticals A/S, Mr. Jensen
served as the general counsel and chief financial officer of Genmab A/S, a company listed on
Nasdaq Global Select Market and the Copenhagen Stock Exchange (stock code: GMAB), a
publicly traded biotechnology company from 2000 to 2003.
Mr. Jensen obtained his Master of Laws degree from University of Copenhagen in 1997.
Mr. Jan Møller MIKKELSEN , aged 65, was appointed as a Director on November 7,
2018. He was re-designated as a non-executive Director on March 27, 2021. Mr. Mikkelsen is
responsible for participating in formulating the Company’s corporate and business strategies.
He has been the director of VISEN Shanghai since February 2019, the director of VISEN HK
since October 2019, the director of VISEN BVI since November 2020, and the director of
VISEN Suzhou since June 2021.
DIRECTORS AND SENIOR MANAGEMENT
– 402 –


--- page 413 ---
Mr. Mikkelsen currently serves as the chairman of the board of directors of Hummingbird
Bioscience Holdings Limited. Mr. Mikkelsen founded Ascendis Pharma A/S (Nasdaq: ASND)
and has served as president and chief executive officer as well as board member since
December 2007. From 2002 to 2006, Mr. Mikkelsen served as the president and chief executive
officer of LifeCycle Pharma A/S, now V eloxis Pharmaceuticals A/S, a company listed on the
NASDAQ OMX Copenhagen (stock code: VELO). From 2000 to 2002, Mr. Mikkelsen was the
president of the pharmaceutical division of Maxygen, Inc. Prior to that, Mr. Mikkelsen
co-founded ProFound Pharma A/S, a biopharmaceutical company that was later acquired by
Maxygen, Inc., and served as co-chief executive officer from 1999 to 2000. Prior to that, Mr.
Mikkelsen held various positions at Novo Nordisk A/S, a global healthcare company, including
vice president of protein discovery. Mr. Mikkelsen currently serves as a member of the
advisory board of Inspirion Delivery Technologies, a specialty pharmaceutical company.
Mr. Mikkelsen received a Cand. Scient. degree in Biochemistry from the University of
Odense, Denmark in July 1985, and pursued his post-doctoral research at Children’s Hospital
in Oakland, CA from July 1985 to January 1986.
Mr. FU Shan ( ˹ʆ), aged 56, was appointed as a Director on November 2018, and
re-designated as a non-executive Director on March 27, 2021. Mr. Fu is responsible for
participating in formulating the Company’s Corporate and business strategies. He has been the
director of VISEN HK since November 2018, the director of VISEN Shanghai since February
2019, the director of VISEN BVI since November 2020, and the director of VISEN Suzhou
since June 2021.
Mr. Fu has served as joint chief executive officer and the greater China chief executive
officer of Vivo Capital LLC since October 2013. Since July 2018, Mr. Fu has served as a
non-executive director of Sinovac Biotech Ltd., a company listed on the NASDAQ Global
Market (stock code: SV A). Since January 2016, Mr. Fu has served as a non-executive director
in TOT BIOPHARM International Company Limited, a company listed on the Stock Exchange
(stock code: 1875). From June 2021 to March 2024, Mr. Fu served as a director of Genetron
Holdings Limited (a company previously listed on the NASDAQ Global Market (stock code:
GTH) and delisted in March 2024). From February 2018 to March 2023, he served as a
non-executive director in InnoCare Pharma Limited, a company listed on the Stock Exchange
(stock code: 9969). From June 2008 to October 2013, Mr. Fu was the senior managing director
of the Beijing branch of Blackstone (Shanghai) Equity Investment Management Company
Limited. From June 2003 to March 2008, he worked at China National Development and
Reform Commission and served as the director of general office and the director of policy and
regulations department. Prior to that, he was the director of policy and foreign investment
department in the State Economic and Trade Commission of China.
Mr. Fu received his Bachelor of Arts degree in history from Peking University in July
1988. He obtained his Master’s degree in history from Peking University in July 1991.
DIRECTORS AND SENIOR MANAGEMENT
– 403 –


--- page 414 ---
Mr. Michael J. CHANG , aged 41, was appointed as a non-executive Director on
December 1, 2023. Mr. Chang is responsible for participating in formulating the Company’s
corporate and business strategies.
Mr. Chang worked in Vivo Capital LLC since August 2012 and now is a managing partner
of Vivo Capital LLC. Prior to joining Vivo Capital, Mr. Chang worked at Johnson & Johnson,
a company listed on NYSE (stock code: JNJ), serving as a senior manager from August 2008
to September 2010 and a part-time consultant in 2011. From August 2006 to July 2008, Mr.
Chang served as a consultant in Strategy & (formerly known as Booz & Company Inc.) Prior
to that, Mr. Chang worked as an analyst in the healthcare team of Fletcher Spaght Inc. from
July 2005 to May 2006.
Mr. Chang obtained his Bachelor’s degree in Economics from Harvard College in 2005,
and obtained an M.B.A. from Harvard Business School in 2012.
Mr. CAO Yibo ( ૎ʏ௹), aged 41, was appointed as a Director on January 8, 2021 and
re-designated as a non-executive Director on March 27, 2021. Mr. Cao is responsible for
participating in formulating the Company’s Corporate and business strategies. He has been the
director of VISEN BVI and VISEN HK since February 2021, the director of VISEN Shanghai
since May 2021, and the director of VISEN Suzhou since June 2021.
Mr. Cao works at Hongshan and has served as the managing director since July 2017. Mr.
Cao joined Vivo Capital LLC in August 2011 and left as a managing director in July 2017.
Since December 2020, Mr. Cao has served as a director of Beijing Microread Genetics Co.,
Ltd., a company listed on the National Equities Exchange and Quotations (stock code: 873723).
Mr. Cao obtained his Bachelor’s degree in pharmacy and his Master’s degree in science
(majored in clinical pharmacy) from Peking University in July 2005 and July 2007,
respectively.
Independent Non-executive Directors
Dr. YAO Zhengbin (Bing) , aged 58, was appointed as an independent non-executive
Director effective as of April 1, 2021, and is primarily responsible for supervising and
providing independent judgment to the Board. Dr. Y ao has also been serving in the capacity as
an independent director of our subsidiary VISEN BVI since April 2021.
Dr. Y ao is currently serving as the chief executive officer and chairman of the board of
the ArriV ent BioPharma, Inc., a company listed on the Nasdaq (stock code: A VBP)
since June 2021. Dr. Y ao has also been serving as a director of Alumis Inc, a company listed
on the Nasdaq (stock code: ALMS), developing therapeutics for autoimmune diseases since
June 2021. Dr. Y ao has served as a director of NexImmune, Inc., a company listed on the
Nasdaq (stock code: NEXI), from January 2017 to August 2024, the chief executive officer and
president of Viela Bio, Inc., a company listed on Nasdaq (“Viela”, stock code: VIE) from
February 2018 to March 2021, and the chairman of the board of Viela Bio, Inc. from
January 2019 to March 2021, until it was acquired by Horizon Therapeutics Public
Limited Company (“Horizon”, Nasdaq: HZNP). Dr. Y ao previously served as senior vice
president of Respiratory, Inflammation and Autoimmune at MedImmune, a subsidiary of
DIRECTORS AND SENIOR MANAGEMENT
– 404 –


--- page 415 ---
AstraZeneca, and senior vice president and head of Immuno-Oncology Franchise, AstraZeneca
Plc, a company primarily listed on the London Stock Exchange (stock code: AZN). He has held
various positions including vice president of research and senior director of discovery biology
at Tanox, Inc. before it was acquired by Genentech.
Dr. Y ao received his Master’s in Science degree in immunology from Anhui Medical
University in Anhui, China in July 1989 and Ph.D. degree in microbiology and immunology
from the University of Iowa in June 1994.
Dr. Y ao, in his capacity as the then chairman/chief executive officer/president of Viela,
along with each of the former Viela board members, one of Viela’s large shareholders and
others, was named as a co-defendant in a class action initiated in February 2023 by certain
former stockholders of Viela which alleges various breaches of fiduciary duties in connection
with Viela’s acquisition by Horizon Therapeutics PLC. As of the latest Practicable Date, the
case was dismissed with prejudice by the Court of Chancery of the State of Delaware. Such
former shareholders of Viela have appealed the decision to the Delaware Supreme Court, where
the case is currently pending.
Given (1) all of the cases were brought against Viela’s board as a whole, instead of
targeting Dr. Y ao in his personal capacity as the then chairman/chief executive officer/president
of Viela; (2) the court has not made any judgment, ruling or decision against Viela, its board
or Dr. Y ao; and (3) it is not uncommon to see securities actions in connection with public
mergers and acquisitions in the U.S. and there are plaintiffs law firms that pursue these types
of actions on a regular basis regardless of the underlying substance of the matter, the Company
is of the view that the securities actions do not affect Dr. Y ao’s suitability to act as a director
of the Company.
Mr. CHAN Peng Kuan (ඓ), aged 61, was appointed as an independent non-
executive Director effective as of April 1, 2021, and is primarily responsible for supervising
and providing independent judgment to the Board. Mr. Chan has also been serving in the
capacity as an independent director of our subsidiary VISEN BVI since April 2021.
Mr. Chan has served as an independent non-executive director at JW (Cayman)
Therapeutics Co. Ltd (stock code: 2126) since August 2024, CANbridge Pharmaceuticals Inc.
(stock code: 1228) and Y onghe Medical Group Co., Ltd. (stock code: 2279) since June 2021,
respectively, all of which are listed on the Stock Exchange. From February 2019 to November
2024, Mr. Chan served as an independent non-executive director at Yincheng International
Holding Co., Ltd., a company listed on the Stock Exchange (stock code: 1902). From October
2017 to May 2019, Mr. Chan served as the chief financial officer of Elegance Optical Int’l
Holdings Ltd, a company listed on the Stock Exchange (stock code: 907). From January 2012
to September 2017, he served as the chief operating officer at CITIC Merchant Co., Limited.
Prior to that, he worked at Piper Jaffray Asia Limited from January 2011 to November 2011
and served as the head of Asia CIG and Cleantech at the investment banking department. From
March 2005 to January 2011, he worked at BNP Paribas Capital (Asia Pacific) Limited with
his last position as the managing director of corporate finance – greater China coverage
department. From August 2000 to December 2004, Mr. Chan served as an executive director
of Sanyuan Group Limited (ʮ̡) (“Sanyuan Group”), a company delisted from
DIRECTORS AND SENIOR MANAGEMENT
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the Stock Exchange in December 2009 (stock code: 0140), which principally engaged in
property investment and bio-pharmaceuticals, with the mission of restructuring its business
activities and materialising its debt restructuring plan.
Mr. Chan obtained his Bachelor of Commerce degree from University of Canterbury in
New Zealand in May 1989 and his Master of Applied Finance degree from Macquarie
University in Australia in November 1998. Mr. Chan is a Chartered Accountant of the
Chartered Accountants Australia and New Zealand and a Certified Public Accountant of the
Hong Kong Institute of Certified Public Accountants.
Mr. Chan was a director of the following companies, which were involuntarily wound up:
Name of
Company
Place of
incorporation
Principal business
activity immediately
before being
voluntarily wound up
or struck off
Voluntarily wound up
or being struck off Reason
Pacific
Engineering
Limited
Hong Kong a company principally
engaged in the
trading of the sea
sand
Involuntarily wound up
on May 11, 2006 due
to winding up order
This company had been
making loss and a
creditor filed a
petition to wind up
this company which
was subsequently
dissolved by
compulsory winding
up.
Infinity
Properties
Limited
Hong Kong a property holding
company
Involuntarily wound up
on January 31, 2007
due to winding up
order
This company was
wound up as a result
of the debt
restructuring
agreement reached
between Sanyuan
Group Limited (a
then listed company
on the Stock
Exchange and the
holding company of
this company) and
the relevant lending
bank. This company
was dissolved by
compulsory winding
up as a result
thereof.
DIRECTORS AND SENIOR MANAGEMENT
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Name of
Company
Place of
incorporation
Principal business
activity immediately
before being
voluntarily wound up
or struck off
Voluntarily wound up
or being struck off Reason
Propland
Limited
Hong Kong a property holding
company
Involuntarily wound up
on October 6, 2006
due to winding up
order
same as above
V&O
Company
Limited
Hong Kong a property holding
company
Involuntarily wound up
on October 6, 2006
due to winding up
order
same as above
Mr. Chan was appointed on August 31, 2000 as a director of each of Pacific Engineering
Limited, Infinity Properties Limited, Propland Limited and V & O Company Limited
(collectively, the “Relevant Companies”), all of which were incorporated in Hong Kong and
wholly-owned subsidiaries of Sanyuan Group.
As a result of the debt restructuring agreement reached between Sanyuan Group Limited
(ʮ̡) and the relevant lending bank, winding up petitions were filed to wind up
Infinity Properties Limited, Propland Limited and V&O Company Limited on December 23,
2004 and the respective winding-up orders were granted against those companies on February
23, 2005.
There was no wrongful act on the part of Mr. Chan leading to the winding up of the
Relevant Companies.
Mr. Chan has confirmed that, (i) he was not involved in the daily operations of the
Relevant Companies at any time; and (ii) during the course of the liquidation of the Relevant
Companies, there was no allegation of fraud or other impropriety, judgment debt or
disqualification order made against him.
Considering the facts as stated above, the Company is of the view that his past
involvement as a director in four involuntarily wound-up companies do not affect Mr. Chan’s
suitability to act as an independent non-executive Director. Based on the aforementioned facts
and independent due diligence conducted by the Joint Sponsors, nothing material has come to
the Joint Sponsors’ attention to disagree with the Company’s view on the suitability of Mr.
Chan to act as an Independent Non-Executive Director of the Company.
Ms. NI Hong (ࠀࡎ)aged 52, was appointed as an independent non-executive Director
effective as of April 1, 2021, and is primarily responsible for supervising and providing
independent judgment to the Board. Ms. Ni has also been serving in the capacity as an
independent director of our subsidiary VISEN BVI since April 2021.
DIRECTORS AND SENIOR MANAGEMENT
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Ms. Ni has served as independent director of Zhihu Inc., a company listed on the New
Y ork Stock Exchange (stock code: ZH), since March 2021, Acotec Scientific Holdings Limited,
a company listed on the Stock Exchange (stock code: 6669), since August 2021, A TA Creativity
Global (formerly known as A TA Inc.), a company listed on Nasdaq (stock code: AACG) since
January 2008, Ucloudlink Group Inc., a company listed on Nasdaq (stock code: UCL) since
June 2020.
Ms. Ni served as an independent non-executive director of Digital China Holdings
Limited, a company listed on the Stock Exchange (stock code: 0861), from September 2010 to
June 2024, an executive director of COGOBUY Group, a company listed on the Stock
Exchange (stock code: 400), from March 2015 to June 2020 and a non-executive director from
June 2020 to June 2022. Previously, Ms. Ni worked as a practicing attorney at Skadden, Arps,
Slate, Meagher & Flom LLP in New Y ork and Hong Kong, specializing in corporate finance.
Ms. Ni obtained her Juris Doctor degree from the University of Pennsylvania Law School
in May 1998 and her bachelor’s degree in applied economics and business management from
Cornell University in May 1994.
SENIOR MANAGEMENT
The following table sets forth information about our senior management:
Name Age Position
Date of
joining our
Group
Date of
appointment
as Senior
Management
Roles and
responsibilities
Mr. LU An-bang
(ጅτԞ)
57 Executive Director,
Chief Executive
Officer
November 7,
2018
November 7,
2018
Overall management
of the business of
the Company
Dr. CHEN Jun
(ࠏ)
54 Chief Commercial
Officer
April 1, 2021 April 1, 2021 Overall management
of the drug
commercialization
of the Company
Mr. WU Jian
(ܔ)
49 Executive Advisor January 4,
2022
January 4,
2022
Capital market
activities, investor
relations, and
strategy
formulation and
enforcement of the
Company
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Mr. LU An-bang ( ጅτԞ), aged 57, was appointed as a Director and Chief Executive
Officer of the Company on November 7, 2018. He was re-designated as an Executive Director
on March 27, 2021. Mr. Lu is responsible for the strategic planning, business direction and
day-to-day operational management of the Company. Please refer to the sub-section headed “–
Board of Directors – Executive Directors” in this section for his biography.
Dr. CHEN Jun (ࠏ)aged 54 , was appointed as the Chief Commercial Officer of our
Company on April 1, 2021 and is responsible for the overall management of the drug
commercialization of our Group.
Dr. Chen has served as vice president of diabetes portfolio business unit at Eli Lilly China
from July 2018 to March 2021. From May 2016 to July 2018, he was vice president of diabetes
business group of Medtronic in greater China. From January 2002 to April 2016, Dr. Chen
served at various management roles at Novo Nordisk USA and China where his final position
was vice president of marketing at Novo Nordisk China from October 2010 to April 2016. He
was an associate at McKinsey & Company from 2000 to 2002. Prior to that, Dr. Chen was
pharmaceutical scientist at Merck & Co. and its affiliate company Merial Ltd. from 1997 to
2000.
Dr. Chen received his Bachelor’s degree in molecular biology from the University of
Science and Technology of China in July 1992, and his Ph.D. degree from Purdue University
in the U.S. in May 1997.
Mr. WU Jian (ܔ)aged 49, was appointed as the Executive Advisor of our Company
on January 4, 2022 and is responsible for capital market activities, investor relations, and
strategy formulation and enforcement of our Group.
Prior to joining the Group, Mr. Wu has served as the head of equity capital markets and
executive director of the corporate finance and capital markets services division of ICBC
International Holdings Limited from August 2015 to March 2021. From December 2013 to
August 2015, Mr. Wu was the director of the global capital market department of China
Merchants Securities (HK) Co., Ltd.. From May 2011 to April 2013, Mr. Wu was the head of
China ECM of the equity capital markets of investment banking department of Daiwa Capital
Markets Hong Kong Limited. From January 2010 to May 2011, Mr. Wu was the vice president
of investment banking department of BOCOM International Holdings Company Limited. From
February 2008 to October 2009, Mr. Wu was an associate in the global banking division of
Deutsche Bank, Hong Kong Branch. Mr. Wu served as a senior software engineer at BEA
Systems, Inc. from July 2002 to September 2006.
In January 2008, Mr. Wu received his Master of Business Administration degree from the
University of Oxford, the United Kingdom. In May 2002, Mr. Wu received his Master’s degree
in information management and systems from University of California, Berkeley, the United
States. In June 1998, Mr. Wu received his Bachelor’s degree in management information
systems from the Tsinghua University.
DIRECTORS AND SENIOR MANAGEMENT
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Directors’ and Senior Management’s Interests
Save as disclosed above in this section, none of our Directors or senior management has
been a director of any public company the securities of which are listed on any securities
market in Hong Kong or overseas in the three years immediately preceding the date of this
document.
Save as disclosed above in this section, to the best of the knowledge, information and
belief of our Directors having made all reasonable enquiries, there was no other matter with
respect to the appointment of our Directors that needs to be brought to the attention of our
Shareholders and there was no information relating to our Directors that is required to be
disclosed pursuant to Rules 13.51(2)(h) to (v) of the Listing Rules as of the Latest Practicable
Date.
As of the Latest Practicable Date, save for the interests in the Shares of our Company held
indirectly by Mr. LU An-bang, which are disclosed in the paragraphs headed “Appendix IV –
Statutory and General Information – C. Further Information about Our Directors and
Substantial Shareholders” in this Prospectus, none of our Directors held any interest in the
securities within the meaning of Part XV of the SFO.
Save as disclosed above in this section, as of the Latest Practicable Date, none of our
Directors or senior management is related to other Directors or senior management of our
Company.
COMPANY SECRETARY
Ms. Chan Sze Ting ( ௓་ణ) has been appointed as the company secretary of the
Company on March 8, 2025. Ms. Chan currently serves as a director of the Company
Secretarial Services of Tricor Services Limited, a member of Vistra Group.
Ms. Chan has over 18 years of experience in the corporate secretarial field and has been
providing professional corporate services to Hong Kong listed companies as well as
multinational, private and offshore companies.
Ms. Chan is a Chartered Secretary, a Chartered Governance Professional and a Fellow of
both The Hong Kong Chartered Governance Institute and The Chartered Governance Institute
in the United Kingdom. Ms. Chan holds a bachelor of laws degree from the University of
London.
DIRECTORS AND SENIOR MANAGEMENT
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--- page 421 ---
CORPORATE GOVERNANCE
Board Committees
The Board has established the following committees, namely the audit committee, the
remuneration committee and the nomination committee. The committees operate in accordance
with respective terms of reference established by our Board.
Audit Committee
The Company has established the audit committee of the Board with written terms of
reference in compliance with Rule 3.21 of the Listing Rules and Appendix C1 to the Listing
Rules (the “Corporate Governance Code”). The primary duties of our audit committee include
the review and supervision of the Group’s financial reporting system, monitoring the internal
control procedures and risk management, review of the Group’s financial information, review
of the relationship with the external auditor of the Company and performance of the corporate
governance functions delegated by the Board.
Our audit committee consists of two independent non-executive Directors and one
non-executive Director and the chairman is Mr. CHAN Peng Kuan who holds the appropriate
professional qualifications as required under Rules 3.10(2) and 3.21 of the Listing Rules. Our
audit committee consists of the following members:
Mr. CHAN Peng Kuan (chairman)
Mr. FU Shan
Dr. Y AO Zhengbin (Bing)
Remuneration Committee
The Company has established the remuneration committee with written terms of reference
in compliance with Rule 3.25 of the Listing Rules and the Corporate Governance Code. The
primary duties of the remuneration committee include making recommendations to the Board
on the Company’s policy and structure for the remuneration of the Directors and senior
management; and reviewing and approving the remuneration packages of all Directors and
senior management with reference to corporate goals and objectives resolved by our Board
from time to time. Our remuneration committee consists of the following members:
Ms. NI Hong (chairwoman)
Mr. CHAN Peng Kuan
Mr. LU An-Bang
DIRECTORS AND SENIOR MANAGEMENT
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Nomination Committee
The Company has established the nomination committee with written terms of reference
in compliance with the Corporate Governance Code. The primary duties of the nomination
committee include reviewing the structure, size and composition of our Board, assessing the
independence of our independent non-executive Directors, identifying individuals suitably
qualified to be a member of the Board and making recommendation to our Board on matters
relating to the appointment or re-appointment of Directors. Our nomination committee consists
of the following members:
Mr. Michael Wolff JENSEN (chairman)
Dr. Y AO Zhengbin (Bing)
Ms. NI Hong
Corporate Governance Code
We have adopted certain corporate governance measures in compliance with the
Corporate Governance Code. We aim to achieve a high standard of corporate governance,
which is crucial to safeguard the interests of the Shareholders. To accomplish this, we expect
to comply with the Corporate Governance Code after the Listing.
Board Diversity Policy
In order to enhance the effectiveness of the Board and to maintain the high standard of
corporate governance, we have adopted the board diversity policy which sets out the objective
and approach to achieve and maintain diversity of the Board. Pursuant to the board diversity
policy, we seek to achieve board diversity through the consideration of a number of factors
when selecting the candidates to the Board, including but not limited to gender, age, cultural
and educational background, or professional experience. The ultimate decision of the
appointment will be based on merit and the contribution which the selected candidates will
bring to the Board.
The Board comprises nine members, including one executive Director, five non-executive
Directors and three independent non-executive Directors. Our Directors have a balanced mix
of knowledge, skills, perspectives and experience, including overall management and strategic
development, business, science, investment, accounting and consulting. They obtained
professional and academic qualifications including business administration, law, economics
and science. Taking into account our existing business model and specific needs as well as the
different background of our Directors, the composition of the Board satisfies our board
diversity policy, and the Board and the nomination committee of the Company will assess the
Board composition regularly.
Our nomination committee is responsible for reviewing the diversity of the Board. After
Listing, our nomination committee will continue to monitor and evaluate the implementation
of the board diversity policy from time to time to ensure its continued effectiveness and we will
DIRECTORS AND SENIOR MANAGEMENT
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--- page 423 ---
disclose in our corporate governance report about the implementation of the board diversity
policy, including any measurable objectives set for implementing the board diversity policy
and the progress on achieving these objectives on an annual basis. We will also continue to take
steps to promote gender diversity at all levels of our Company, including but without limitation
at the Board and senior management levels.
KEY TERMS OF EMPLOYMENT AGREEMENTS WITH OUR SENIOR
MANAGEMENT AND KEY PERSONNEL
We normally enter into: (i) an employment contract; (ii) a non-disclosure agreement; and
(iii) a non-competition agreement with our senior management members and other key
personnel. Below sets forth the key terms of these contracts we enter into with our senior
management and other key personnel.
Term
We normally enter into an employment contract with a term up to 3 years with our senior
management members and other key personnel.
Confidentiality
Scope of confidential information. The scope of confidential information include, without
limitation:
i. confidential information relating to the processes, products, specifications,
organization, finances, operations, planning research and/or development programs,
marketing, business forecasts, procurement, requirements, customer lists and
accounts;
ii. any other confidential information relating to products produced or marketed, or
contemplated to be produced or marketed, by the Company or any member thereof;
iii. any business records, papers, reports, notebooks, calendars, documents, drawings,
charts, samples, or similar forms of tangibly recorded data, containing any of the
above information;
iv. any information, data or records, including the types described above which by
agreement with the Company are to be kept confidential or secret; and
v. all copies of the above information.
Confidential obligation. During and after the employment with the Company, the
employee shall not disclose or communicate any of the confidential information to any
competitor or other third party or use or refer to any of the confidential information for any
DIRECTORS AND SENIOR MANAGEMENT
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--- page 424 ---
purpose, or remove materials containing any of the confidential information from the
Company’s premises, except as necessary for the employee to properly perform services for the
Company during his/her service, or required by relevant laws and regulations or administrative
authorities. All confidential information of previous employers, including any invention,
discovery, secret or confidential information, knowledge or data of any third party to which the
employee may be under an obligation of secrecy shall not be disclosed to or used for the benefit
of the Company.
Confidential period. The confidentiality obligation shall continue to be in effect after 5
years upon termination of the employment.
Non-Competition Covenants
Non-competition obligation. During the term of the employment contract and within 24
months from the employee’s departure from the Company, the employee shall not: (i) serve in
or provide services to enterprises that compete with the Group; (ii) produce and operate any
other same or similar products or businesses that compete with the Group; (iii) establish or
participate in, or purchase stakes of entities that compete with the Group; or (iv) contact with
clients of the Group which is not for the benefits of the Group.
Non-solicitation obligation. During the term of the employment contract and within 24
months from the employee’s departure from the Company, the employee shall not either for
themselves or for any other person or entity (i) directly or indirectly entice, induce, remand,
persuade, recruit or encourage, or attempt to entice, induce, remand, persuade, recruit or
encourage any of our employees to leave the Company, or (ii) otherwise encourage or induces
any other staff of the Company to serve in other organizations.
Compensation for Breach of Covenants
If the employee breaches the confidentiality covenants or non-competition covenants, our
Group shall be entitled to seeking a specified amount of compensation from the defaulting
employee.
REMUNERATION OF DIRECTORS AND SENIOR MANAGEMENT
For details on the service contracts and appointment letters signed between the Company
and our Directors, please refer to the section “Statutory and General Information – C. Further
Information about Our Directors and Substantial Shareholders” in Appendix IV to this
document. Our Directors and senior management receive compensation in the form of salaries,
allowances, bonuses and other benefits in kind, including our contribution to the pension
scheme. The aggregate amount of remuneration (including salaries, bonuses, allowances and
benefits in kind, contributions to pension scheme, discretionary bonus and bonus based on
performance) that was paid by our Group to our Directors for each of the two years ended
December 31, 2022 and 2023 and the nine months ended September 30, 2024 was RMB62.5
DIRECTORS AND SENIOR MANAGEMENT
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--- page 425 ---
million (including share grant), RMB19.1 million (including share grant) and RMB24.7 million
(including share grant), respectively. Please refer to Note 9 of the Accountants’ Report in
Appendix I to this document on the Directors’ and chief executive’s remuneration for the Track
Record Period.
The aggregate amount of remuneration (including salaries, allowances and benefits in
kind, contributions to pension scheme, discretionary bonus and bonus based on performance)
paid to our five highest paid individuals for the two years ended December 31, 2022 and 2023
and the nine months ended September 30, 2024 was RMB97.3 million, RMB38.6 million and
RMB39.6 million, respectively.
During the Track Record Period, (i) no remuneration was paid to our Directors or the five
highest paid individuals as an inducement to join, or upon joining our Group, (ii) no
compensation was paid to, or receivable by, our Directors or past Directors or the five highest
paid individuals for the loss of office as director of any member of our Group or any other
office in connection with the management of the affairs of any member of our Group, and (iii)
none of our Directors waived any emoluments. Our Directors’ remuneration is determined with
reference to the relevant Director’s experience and qualifications, level of responsibility,
performance and the time devoted to our business, and the prevailing market conditions.
Except as disclosed in this document, no Director has been paid in cash or shares or
otherwise by any person either to induce him to become, or to qualify him as a Director, or
otherwise for service rendered by him in connection with the promotion or formation of us.
SHARE SCHEMES
We have adopted the Share Schemes, including the Equity Incentive Plan and the
Post-IPO Share Award Scheme. For further details, please see “Statutory and General
Information – D. Equity Incentive Plan” and “Statutory and General Information – E. Post-IPO
Share Award Scheme” in Appendix IV to this document.
COMPLIANCE ADVISER
The Company has appointed Somerley Capital Limited as its compliance adviser pursuant
to Rule 3A.19 of the Listing Rules. In compliance with Rule 3A.23 of the Listing Rules, the
Company must consult with and, if necessary, seek advice from the compliance adviser on a
timely basis in the following circumstances:
 before the publication of any regulatory announcement, circular or financial report;
 where a transaction, which might be a notifiable or connected transaction or
constitute price sensitive information of our Company, is contemplated including
share issues, sales or transfers of treasury shares and share repurchases;
DIRECTORS AND SENIOR MANAGEMENT
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--- page 426 ---
 where we propose to apply the proceeds of the Global Offering in a manner different
from that detailed in this document or where our business activities, developments
or results deviate from any forecast, estimate or other information in this document;
and
 where the Stock Exchange makes an inquiry of us in respect of unusual price
movement and trading volume or other issues under Rule 13.10 of the Listing Rules.
The terms of appointment of the compliance adviser will commence on the Listing Date
and end on the date on which the Company distributes its annual report in respect of its
financial results for the first full financial year commencing after the Listing Date.
COMPETITION
Each of our Directors confirms that as of the Latest Practicable Date, he or she did not
have any interest in a business which competes or is likely to compete, directly or indirectly,
with our business and requires disclosure under Rule 8.10 of the Listing Rules.
From time to time our non-executive Directors may serve on the boards of both private
and public companies within the broader healthcare and biopharmaceutical industries.
However, as these non-executive Directors are not members of our executive management
team, we do not believe that their interests in such companies as directors would render us
incapable of carrying on our business independently from the other companies in which these
non-executive Directors may hold directorships from time to time.
CONFIRMATION FROM OUR DIRECTORS
Rule 3.09D of the Listing Rules
Each of our Directors confirms that he or she (i) has obtained the legal advice referred
to under Rule 3.09D of the Listing Rules, and (ii) understands his or her obligations as a
director of a Listed issuer under the Listing Rules.
Rule 3.13 of the Listing Rules
Each of the independent non-executive Directors has confirmed (i) his/her independence
as regards each of the factors referred to in Rules 3.13(1) to (8) of the Listing Rules, (ii) he/she
has no past or present financial or other interest in the business of the Company or its
subsidiaries or any connection with any core connected person of the Company under the
Listing Rules as of the Latest Practicable Date, and (iii) that there are no other factors that may
affect his/her independence at the time of his/her appointments.
DIRECTORS AND SENIOR MANAGEMENT
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So far as our Directors are aware, immediately following completion of the Global
Offering, assuming the Offer Size Adjustment Option and the Over-allotment Option are not
exercised and no Shares are issued under the Post-IPO Share Award Scheme, the following
persons will have interests and/or short positions in the Shares or underlying shares of our
Company which would fall to be disclosed to us pursuant to the provisions of Divisions 2 and
3 of Part XV of the SFO, or, who is, directly or indirectly, interested in 10% or more of the
nominal value of any class of share capital carrying rights to vote in all circumstances at
general meetings of our Company or any other member of our Group. Our Directors are not
aware of any arrangement which may at a subsequent date result in a change of control of our
Company:
Name of
Substantial Shareholder
Capacity/
Nature of
Interest
Total number of
Shares/underlying
shares as at the
Latest Practicable
Date
(1)
Approximate
percentage of
interest in our
Company as
at the Latest
Practicable Date
Total number of
Shares/
underlying shares
immediately after
completion of the
Global Offering (2)
Approximate
percentage of
interest in
our Company
immediately after
completion of the
Global Offering (2)
Ascendis Pharma A/S (3) Interest in
controlled
corporation
41,136,364 40.12% 41,136,364 36.58%
Ascendis Pharma
Endocrinology
Division
(3)
Beneficial
interest
20,568,182 20.06% 20,568,182 18.29%
Ascendis Pharma Growth
Disorders (3)
Beneficial
interest
7,713,068 7.52% 7,713,068 6.86%
Ascendis Pharma Bone
Diseases (3)
Beneficial
interest
12,855,114 12.54% 12,855,114 11.43%
Vivo Capital IX
(Cayman), LLC. (4)
Interest in
controlled
corporation
36,136,364 35.24% 36,136,364 32.14%
(5)
Vivo Capital Fund IX
(Cayman), L.P . (4)
Interest in
controlled
corporation
36,136,364 35.24% 36,136,364 32.14%
(5)
Vivo Plenilune IX
Limited (4)
Beneficial
interest
36,136,364 35.24% 36,136,364 32.14% (5)
SUBSTANTIAL SHAREHOLDERS
– 417 –


--- page 428 ---
Notes:
(1) The number of Shares held assuming that all of the Preferred Shares have been converted into the Shares on
a one-to-one basis.
(2) Based on the assumption that the Offer Size Adjustment Option and the Over-allotment Option are not
exercised and no Shares are issued under the Post-IPO Share Award Scheme.
(3) As of the Latest Practicable Date, (i) Ascendis Pharma Endocrinology Division directly held 20,568,182
Shares, consisting of 20,000,000 Series A Preferred Shares and 568,182 Series B Preferred Shares; (ii)
Ascendis Pharma Growth Disorders directly held 7,713,068 Shares, consisting of 7,500,000 Series A Preferred
Shares and 213,068 Series B Preferred Shares; and (iii) Ascendis Pharma Bone Diseases directly held
12,855,114 Shares, consisting of 12,500,000 Series A Preferred Shares and 355,114 Series B Preferred Shares.
Each of Ascendis Pharma Endocrinology Division, Ascendis Pharma Growth Disorders and Ascendis Pharma
Bone Diseases is a wholly-owned subsidiary of Ascendis Pharma A/S. As such, under the SFO, Ascendis
Pharma A/S is deemed to be interested in the total amount of Shares held by Ascendis Pharma Endocrinology
Division, Ascendis Pharma Growth Disorders and Ascendis Pharma Bone Diseases.
(4) As of the Latest Practicable Date, Vivo Plenilune IX Limited, or Vivo Capital directly held 36,136,364 Shares,
consisting of 35,000,000 Series A Preferred Shares and 1,136,364 Series B Preferred Shares. Vivo Plenilune
IX Limited is a wholly-owned subsidiary of Vivo Capital Fund IX (Cayman), L.P ., which is in turn controlled
by its general partner, Vivo Capital IX (Cayman), LLC. As such, under the SFO, Vivo Capital IX (Cayman),
LLC. and Vivo Capital Fund IX (Cayman), L.P . are deemed to be interested in the total number of Shares held
by Vivo Plenilune IX Limited.
(5) Vivo Capital is also a cornerstone investor of the Company and has been permitted to subscribe for such
number of shares at the Offer Price in an aggregate investment amount of US$10.0 million (or approximately
HK$77.8 million) (exclusive of brokerage, SFC transaction levy, Stock Exchange trading fee and AFRC
transaction levy). This interest excludes any Offer Shares that may be subscribed by Vivo Capital, under the
Global Offering pursuant to the cornerstone investment agreements. For more information on this subscription,
see the section headed “Cornerstone Investors”.
Except as disclosed above, our Directors are not aware of any other person who will,
immediately following completion of the Global Offering (assuming the Offer Size Adjustment
Option and the Over-allotment Option are not exercised and no Shares are issued under the
Post-IPO Share Award Scheme), have an interest or short position in our Shares or underlying
Shares which would fall to be disclosed to us under the provisions of Divisions 2 and 3 of Part
XV of the SFO, or, will be, directly or indirectly, interested in 10% or more of the issued voting
shares of our Company or any other member of our Group.
SUBSTANTIAL SHAREHOLDERS
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AUTHORIZED AND ISSUED SHARE CAPITAL
The following is a description of the authorized and issued share capital of our Company
in issue and to be issued as fully paid or credited as fully paid immediately following the
completion of the Global Offering.
As at the Latest Practicable Date, our authorized share capital was US$50,000.00 divided
into: (i) 386,363,636 Shares, (ii) 20,000,000 non-voting Shares, (iii) 80,000,000 Series A
Preferred Shares, and (iv) 13,636,364 Series B Preferred Shares.
As of the date of this document, our issued share capital consisted of (i) 80,000,000 Series
A Preferred Shares, (ii) 8,905,500 non-voting Shares, and (iii) 13,636,364 Series B Preferred
Shares. The Preferred Shares and non-voting Shares will be converted into Shares on a
one-to-one basis by way of re-designation before Listing.
Immediately following completion of the Global Offering, assuming the Offer Size
Adjustment Option and the Over-allotment Option are not exercised and no Shares are issued
under the Post-IPO Share Award Scheme, the share capital of our Company immediately will
be as follows:
Description of Shares
Number of
Shares
Aggregate
nominal
value of
Shares
Approximate
percentage
of issued
share capital
(US$)
Shares in issue (including the
Shares on re-designation of
the Preferred Shares and
non-voting Shares) 102,541,864 10,254.2 91.20%
Shares to be issued under
the Global Offering 9,900,000 990.0 8.80%
Total 112,441,864 11,244.2 100%
SHARE CAPITAL
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Immediately following completion of the Global Offering, assuming the Offer Size
Adjustment Option is fully exercised but the Over-allotment Option is not exercised and no
Shares are issued under the Post-IPO Share Award Scheme, the share capital of our Company
will be as follows:
Description of Shares
Number of
Shares
Aggregate
nominal
value of
Shares
Approximate
percentage
of issued
share capital
(US$) (%)
Shares in issue (including the
Shares on re-designation of
the Preferred Shares and
non-voting Shares) 102,541,864 10,254.2 90.01%
Shares to be issued under
the Global Offering 11,385,000 1,138.5 9.99%
Total 113,926,864 11,392.7 100%
Immediately following completion of the Global Offering, assuming the Offer Size
Adjustment Option is not exercised but the Over-allotment Option is exercised and no Shares
are issued under the Post-IPO Share Award Scheme, the share capital of our Company will be
as follows:
Description of Shares
Number of
Shares
Aggregate
nominal
value of
Shares
Approximate
percentage
of issued
share capital
(US$) (%)
Shares in issue (including the
Shares on re-designation of
the Preferred Shares and
non-voting Shares) 102,541,864 10,254.2 90.01%
Shares to be issued under
the Global Offering 11,385,000 1,138.5 9.99%
Total 113,926,864 11,392.7 100%
SHARE CAPITAL
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Immediately following completion of the Global Offering, assuming the Offer Size
Adjustment Option and the Over-allotment Option are exercised in full and no Shares are
issued under the Post-IPO Share Award Scheme, the share capital of our Company will be as
follows:
Description of Shares
Number of
Shares
Aggregate
nominal
value of
Shares
Approximate
percentage
of issued
share capital
(US$) (%)
Shares in issue (including the
Shares on re-designation of
the Preferred Shares and
non-voting Shares) 102,541,864 10,254.2 88.68%
Shares to be issued under
the Global Offering 13,092,700 1,309.3 11.32%
Total 115,634,564 11,563.5 100%
ASSUMPTIONS
The above tables assume that the Global Offering becomes unconditional, that Shares are
issued pursuant to the Global Offering, and that the Preferred Shares and non-voting Shares are
converted into Shares on a one-to-one basis.
RANKING
The Offer Shares are shares in the share capital of our Company and rank equally with
all Shares currently in issue or to be issued (including all Preferred Shares and non-voting
Shares re-designated into Shares upon completion of the Global Offering) and, in particular,
will rank in full for all dividends or other distributions declared, made or paid on the Shares
in respect of a record date which falls after the date of this document.
CIRCUMSTANCES UNDER WHICH GENERAL MEETINGS ARE REQUIRED
Pursuant to the Cayman Companies Act and the terms of the Articles of Association, our
Company may from time to time by ordinary resolution of Shareholders (i) increase its share
capital; (ii) consolidate and divide its share capital into Shares of larger amount; and (iii)
cancel any Shares which have not been taken or agreed to be taken. In addition, our Company
may, subject to the provisions of the Cayman Companies Act, reduce its share capital or capital
SHARE CAPITAL
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redemption reserve by its Shareholders passing a special resolution. For further details, please
refer to the section headed “Appendix III – Summary of the Constitution of Our Company and
Cayman Islands Company Law – Summary of the Constitution of the Company – 2. Articles
of Association – 2.5. Alteration of Capital” in this document.
SHARE SCHEMES
We have adopted the Equity Incentive Plan and the Post-IPO Share Award Scheme. For
further details, please see the sections headed “Appendix IV – Statutory and General
Information – D. Equity Incentive Plan” and “Appendix IV – Statutory and General
Information – E. Post-IPO Share Award Scheme” to this document.
GENERAL MANDATE TO ISSUE SHARES
Subject to the Global Offering becoming unconditional, our Directors have been granted
a general unconditional mandate to allot, issue and deal with Shares with a total nominal value
of not more than the sum of: (i) 20% of the aggregate nominal value of the Shares in issue
(excluding treasury shares of our Company) immediately following completion of the Global
Offering (excluding any Shares which may be issued pursuant to the exercise of the Offer Size
Adjustment Option or the Over-allotment Option); and (ii) the aggregate nominal value of
Shares repurchased by the Company under the authority referred to in “– General Mandate to
Repurchase Shares” in this section.
This general mandate to issue Shares will expire at the earliest of: (i) the conclusion of
the next annual general meeting of our Company unless otherwise renewed by an ordinary
resolution of our Shareholders in a general meeting, either unconditionally or subject to
conditions; or (ii) the expiration of the period within which our Company’s next annual general
meeting is required by the Memorandum of Association and Articles of Association or any
other applicable laws to be held; or (iii) the date on which it is varied or revoked by an ordinary
resolution of our Shareholders in general meeting. For further details on this general mandate,
please see the section headed “Appendix IV – Statutory and General Information – A. Further
Information about Our Group – 4. Resolutions Passed by Our Shareholders” in this document.
GENERAL MANDATE TO REPURCHASE SHARES
Subject to the Global Offering becoming unconditional, our Directors have been granted
a general unconditional mandate to exercise all the powers of our Company to repurchase our
own securities with nominal value of up to 10% of the aggregate nominal value of our Shares
in issue (excluding treasury shares of our Company) immediately following the completion of
the Global Offering (excluding any Shares which may be allotted and issued pursuant to the
exercise of the Offer Size Adjustment Option or the Over-allotment Option). The repurchase
SHARE CAPITAL
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mandate only relates to repurchases made on the Stock Exchange, or on any other stock
exchange on which our Shares are listed (and which are recognized by the SFC and the Stock
Exchange for this purpose), and which are in accordance with the Listing Rules.
This general mandate to repurchase Shares will expire at the earliest of: (i) the conclusion
of the next annual general meeting of our Company unless otherwise renewed by an ordinary
resolution of our Shareholders in a general meeting, either unconditionally or subject to
conditions; or (ii) the expiration of the period within which our Company’s next annual general
meeting is required by the Memorandum of Association and Articles of Association or any
other applicable laws to be held; or (iii) the date on which it is varied or revoked by an ordinary
resolution of our Shareholders passed in a general meeting. For further details of the
repurchase mandate, please see the section headed “Appendix IV – Statutory and General
Information – A. Further Information about Our Group – 4. Resolutions Passed by Our
Shareholders” in this document.
SHARE CAPITAL
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You should read the following discussion and analysis in conjunction with our
audited consolidated financial information including the notes thereto, included in the
Accountants’ Report in Appendix I to this document. Our audited consolidated financial
information has been prepared in accordance with International Financial Reporting
Standards.
The following discussion and analysis contain forward-looking statements that
reflect our current views with respect to future events and financial performance that
involve risks and uncertainties. These statements are based on assumptions and analysis
made by us in light of our experience and perception of historical events, current
conditions and expected future developments, as well as other factors we believe are
appropriate under the circumstances. Our actual results may differ materially from those
anticipated in these forward-looking statements as a result of certain factors. We discuss
factors that we believe could cause or contribute to these differences below and elsewhere
in this document, including those set forth under the sections headed “Risk Factors” and
“Forward-Looking Statements” in this document.
OVERVIEW
We are a late-stage, near-commercialization biopharmaceutical company focused on
providing treatments in selected endocrinology diseases in China (including Hong Kong,
Macau and Taiwan). Since our inception, we have built a pipeline of three drug candidates
targeting selected endocrine diseases, all of which were in-licensed from our collaboration
partner, Ascendis Pharma. We currently have no product approved for commercial sale and
have not generated any revenue from product sales. We have incurred operating losses in each
year since inception and during the Track Record Period. Our total comprehensive losses were
RMB288.9 million, RMB249.5 million and RMB129.7 million in 2022, 2023 and the nine
months ended September 30, 2024, respectively. Substantially all of our operating losses
resulted from R&D expenses, administrative expenses and other gains and losses, net. We
expect to incur significant expenses and operating losses for at least the next several years as
we further our clinical R&D efforts, continue the clinical development of, seek regulatory
approval for, and perform CMC development activities for our drug candidates, launch
commercialization of our pipeline products, and add personnel necessary to operate our
business. Subsequent to the Listing, we expect to incur costs associated with operating as a
public company. We expect that our financial performance will fluctuate from period to period
due to the development status of our drug candidates, regulatory approval timeline and
commercialization of our drug candidates after approval.
FINANCIAL INFORMATION
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BASIS OF PREPARATION
Our Company was incorporated as an exempted company with limited liability in the
Cayman Islands on November 1, 2018. Our Company, as the holding company of our business,
indirectly owns VISEN Shanghai in China that is principally engaged in the research and
clinical development of our drug candidates. See “History, Development and Corporate
Structure” for more details. The consolidated financial information of our Group has been
prepared in accordance with IFRS Accounting Standards issued by the international
Accounting Standards Board (“IASB”). All IFRS Accounting Standards effective for the
accounting period commencing from January 1, 2024, together with the relevant transitional
provisions, have been early adopted by our Group in the preparation of the consolidated
financial information. The consolidated financial information has been prepared under the
historical cost convention. The consolidated financial information of our Group is presented in
RMB and all values are rounded to the nearest thousand except when otherwise indicated.
SIGNIFICANT FACTORS AFFECTING OUR RESULTS OF OPERATIONS
Our results of operations have been, and are expected to continue to be, affected by a
number of factors, many of which may be beyond our control. A discussion of the key factors
is set out below.
Our Ability to Successfully Develop Our Drug Candidates
Our business and results of operations depend on our ability to successfully develop and
seek regulatory approval of our drug candidates. As of the Latest Practicable Date, we had
three drug candidates in our development pipeline, including our Core Product,
lonapegsomatropin, and two other drug candidates, TransCon CNP (navepegritide) and
palopegteriparatide. Leveraging our clinical development capabilities, we provide patients in
China (including Hong Kong, Macau and Taiwan) with access to the following endocrine
solutions: (i) our Core Product, lonapegsomatropin, has completed the Phase 3 pivotal trial in
China for the treatment of PGHD and the BLA filing was accepted by the NMPA on March 7,
2024; (ii) TransCon CNP (navepegritide) has completed the double-blind period of Phase 2
clinical trial in China for the treatment of ACH and the last patient last visit of OLE period of
this trial was completed in April 2024; and (iii) palopegteriparatide is currently undergoing
development in China Phase 3 pivotal trial for the treatment of adult patients with HP and has
completed the double-blind period of this trial in January 2023. See “Business – Our Drug
Pipeline” for more details regarding the development status of our drug candidates. Whether
our drug candidates can demonstrate favorable safety and efficacy clinical trial results, and
whether we can obtain the requisite regulatory approvals for our drug candidates in time, are
crucial for our business and results of operations.
FINANCIAL INFORMATION
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Our Ability to Successfully Commercialize Our Drug Candidates
Subject to us successfully developing and obtaining regulatory approval of our drug
candidates, our business and results of operations depend on our ability to commercialize our
drug candidates. Our pipeline comprises three late-stage clinical drug candidates. Although we
currently have no product approved for commercial sale and have not generated any revenue
from product sales, we expect to commercialize one or more of our drug candidates over the
coming years. Our ability to generate revenue from our drug candidates depends on the
successful commercialization of the drug candidates, which may require significant marketing
efforts in accordance with local rules and regulations. If our drug candidates are approved but
fail to achieve the degree of market acceptance, we may not be able to generate revenue as
expected. See “Business – Commercialization Plan, Patient Support and Market Access” for
our commercialization plans and “Risk Factors – Other Risks Related to Manufacturing and
Commercialization of Our Drug Candidates” for more details regarding the risks related to
commercialization of our drug candidates.
Cost Structure
Our business and results of operations are significantly affected by our cost structure,
which was comprised primarily of R&D expenses, administrative expenses and other gains and
losses, net, during the Track Record Period.
R&D activities are central to our business. Our R&D costs consisted of contracting costs,
raw materials and consumables, staff costs, share-based payment expenses, depreciation and
amortization, cost sharing and others. Our current R&D activities primarily relate to the
clinical development of our Core Product, lonapegsomatropin for the treatment of PGHD, and
our two key drug candidates, TransCon CNP (navepegritide) and palopegteriparatide,
addressing pediatric and adult endocrine diseases respectively. We expect our R&D costs to
increase for the foreseeable future as we continue to progress the clinical development of and
to conduct CMC activities with respect to our current and future drug candidates.
Our administrative expenses consisted of staff costs, depreciation of right-of-use assets,
and property, plant and equipment, amortization, consulting and legal service fees, human
resources and recruitment service fees, share-based payment expenses and others. We expect
our administrative expenses to increase in the future to support our drug development efforts,
commercialization, CMC and manufacturing activities with respect to our drug candidates, if
approved.
We expect our cost structure to evolve as we continue to develop and expand our business.
As we continue to progress and expand our pipeline and gradually bring our product pipeline
to commercialization, we expect to incur additional costs in relation to, among other things, our
R&D, manufacturing, and medical activities in accordance with local rules and regulations. We
also anticipate an increase in the legal, compliance, accounting, insurance, and investor and
public relations expenses as a result of becoming a public company in Hong Kong.
FINANCIAL INFORMATION
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Funding for Our Operations
During the Track Record Period, we funded our operations through private equity
financing. Going forward, in the event of the successful commercialization of one or more of
our drug candidates, we expect to fund our operations in part with revenue generated from sales
of our commercialized drug products. However, with the continuing expansion of our business
we may require further funding through public or private equity offerings, debt financing or
other sources. Any changes in our ability to fund our operations will affect our cash flow and
results of operations. See “– Liquidity and Capital Resources” for more details.
MATERIAL ACCOUNTING POLICY INFORMATION AND ESTIMATES
We have identified certain accounting policies that are significant to the preparation of
our consolidated financial statements. Some of our accounting policies involve subjective
assumptions and estimates, as well as complex judgments relating to accounting items. The
estimates and underlying assumptions are based on historical experience and other factors that
are considered to be relevant. Actual results may differ from these estimates. The estimates and
underlying assumptions are reviewed on an on-going basis. Revisions to accounting estimates
are recognized in the period in which the estimate is revised if the revision affects only that
period, or in the period of the revision and future periods if the revision affects both current
and future periods. When reviewing our consolidated financial statements, you should consider
(i) our material accounting policy information; (ii) the judgments and other uncertainties
affecting the application of such policies; and (iii) the sensitivity of reported results to changes
in conditions and assumptions.
We set forth below those accounting policies that we believe are of critical importance to
us or involve the most significant estimates and judgments used in the preparation of our
consolidated financial statements. Our material accounting policy information and estimates,
which are important for an understanding of our financial condition and results of operations,
are set forth in detail in notes 2 and 3 to the Accountants’ Report in Appendix I to this
document.
Material Accounting Policies
Research and Development Costs
All research costs are charged to profit or loss as incurred. Expenditure incurred on
projects to develop new products is capitalized and deferred only when we can demonstrate the
technical feasibility of completing the intangible asset so that it will be available for use or
sale, our intention to complete and our ability to use or sell the asset, how the asset will
generate future economic benefits, the availability of resources to complete the project and the
ability to measure reliably the expenditure during the development. Product development
expenditure which does not meet these criteria is expensed when incurred.
FINANCIAL INFORMATION
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Leases
We assess at contract inception whether a contract is, or contains, a lease. A contract is,
or contains, a lease if the contract conveys the right to control the use of an identified asset for
a period of time in exchange for consideration.
Our Group as a Lessee
We apply a single recognition and measurement approach for all leases, except for
short-term leases and leases of low-value assets. We recognize lease liabilities representing the
Group’s obligation to make lease payments to lessor and right-of-use assets representing the
right to use the underlying assets.
(a) Right-of-Use Assets
Right-of-use assets are recognized at the commencement date of the lease (i.e., the date
the underlying asset is available for use). Right-of-use assets are measured at cost, less any
accumulated depreciation and any impairment losses, and adjusted for any remeasurement of
lease liabilities. The cost of right-of-use assets includes the amount of lease liabilities
recognized, initial direct costs incurred, and lease payments made at or before the
commencement date less any lease incentives received. Right-of-use assets are depreciated on
a straight-line basis over the shorter of the lease term and the estimated useful lives of the
assets, as follows:
Office premises 2 to 3 years
Land use right 30 years
If ownership of the leased asset transfers to our Group by the end of the lease term or the
cost reflects the exercise of a purchase option, depreciation is calculated using the estimated
useful life of the asset.
(b) Lease Liabilities
Lease liabilities are recognized at the commencement date of the lease at the present value
of lease payments to be made over the lease term. The lease payments include fixed payments
(including in-substance fixed payments) less any lease incentives receivable, variable lease
payments that depend on an index or a rate, and amounts expected to be paid under residual
value guarantees.
In calculating the present value of lease payments, we use our incremental borrowing rate
at the lease commencement date because the interest rate implicit in the lease is not readily
determinable. After the commencement date, the amount of lease liabilities is increased to
reflect the accretion of interest and reduced for the lease payments made. In addition, the
carrying amount of lease liabilities is remeasured if there is a modification, a change in the
FINANCIAL INFORMATION
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lease term, a change in the lease payments (e.g., a change to future payments resulting from
a change in an index or rate used to determine such lease payments) or a change in the
assessment of an option to purchase the underlying asset.
Lease liabilities are presented in separate lines as current and non-current liabilities on
the consolidated statements of financial position.
(c) Short-Term Leases
We apply the short-term lease recognition exemption to its short-term leases of office
premises (that is those leases that have a lease term of 12 months or less from the
commencement date and do not contain a purchase option). Lease payments on short-term
leases are recognized as expense on a straight-line basis over the lease term.
Investments and Other Financial Assets
Initial Recognition and Measurement
Financial assets are classified, at initial recognition, as subsequently measured at
amortized cost, fair value through other comprehensive income, and fair value through profit
or loss.
Financial assets classified and measured at amortized cost are held within a business
model with the objective to hold financial assets in order to collect contractual cash flows,
while financial assets classified and measured at fair value through other comprehensive
income are held within a business model with the objective of both holding to collect
contractual cash flows and selling. Financial assets which are not held within the
aforementioned business models are classified and measured at fair value through profit or
loss. We did not have any financial assets measured at fair value at the end of each reporting
period.
Subsequent Measurement
The subsequent measurement of financial assets depends on their classification as
follows:
Financial Assets at Amortized Cost (Debt Instruments)
Financial assets at amortized cost are subsequently measured using the effective interest
method and are subject to impairment. Gains and losses are recognized in profit or loss when
the asset is derecognized, modified or impaired.
FINANCIAL INFORMATION
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Share-based Payments
We operate an equity incentive plan for the purpose of providing incentives and rewards
to eligible participants who contribute to the success of our operations. Employees (including
Directors) receive remuneration in the form of share-based payments, whereby employees
render services in exchange for equity instruments (“equity-settled transactions”).
The cost of equity-settled transactions with employees is measured by reference to the
fair value at the date at which they are granted. The fair value is determined by an external
valuer using the market approach, further details of which are given in note 22 to Accountants’
Report in Appendix I to this document.
The cost of equity-settled transactions is recognized in employee benefit expense,
together with a corresponding increase in equity (in share reward reserve), over the period in
which the performance and/or service conditions are fulfilled. The cumulative expense
recognized for equity-settled transactions at the end of each reporting period until the vesting
date reflects the extent to which the vesting period has expired and our best estimate of the
number of equity instruments that will ultimately vest. The charge or credit to profit or loss for
a period represents the movement in the cumulative expense recognized as at the beginning and
end of that period.
Service and non-market performance conditions are not taken into account when
determining the grant date fair value of awards, but the likelihood of these conditions being
met is assessed as part of our best estimate of the number of equity instruments that will
ultimately vest. Non-vesting conditions are reflected in the fair value of an award and lead to
an immediate expensing of an award unless there are also service and/or performance
conditions.
For awards that do not ultimately vest because non-market performance and/or service
conditions have not been met, no expense is recognised. Where awards include a market or
non-vesting condition, the transactions are treated as vesting irrespective of whether the market
or non-vesting condition is satisfied, provided that all other performance and/or service
conditions are satisfied.
Where the terms of an equity-settled award are modified, as a minimum an expense is
recognized as if the terms had not been modified, if the original terms of the award are met.
In addition, an expense is recognized for any modification that increases the total fair value of
the share-based payments, or is otherwise beneficial to the employee as measured at the date
of modification.
Where an equity-settled award is cancelled, it is treated as if it had vested on the date of
cancellation, and any expense not yet recognized for the award is recognized immediately. This
includes any award where non-vesting conditions within the control of either we or the
employee are not met. However, if a new award is substituted for the cancelled award, and is
designated as a replacement award on the date that it is granted, the cancelled and new awards
are treated as if they were a modification of the original award, as described in the previous
paragraph.
FINANCIAL INFORMATION
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Government Grants
Government grants are recognized at their fair value where there is reasonable assurance
that the grant will be received and all attaching conditions will be complied with. When the
grant relates to an expense item, it is fully recognized as income on a systematic basis over the
periods that the costs, for which it is intended to compensate, are expensed.
DESCRIPTION OF SELECTED COMPONENTS OF STATEMENTS OF PROFIT OR
LOSS AND OTHER COMPREHENSIVE INCOME
The table below sets forth our consolidated statements of profit or loss and other
comprehensive income for the periods indicated derived from our consolidated statements of
profit or loss and other comprehensive income set forth in the Accountants’ Report in Appendix
I to this document:
Y ear Ended
December 31,
Nine Months Ended
September 30,
2022 2023 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Other income 5,764 11,356 8,809 8,647
Other gains and losses, net 77,184 (106,695) (102,433) (388)
Research and development costs (179,546) (57,690) (38,083) (58,907)
Administrative expenses (177,449) (79,944) (64,064) (64,386)
Finance costs (619) (317) (248) (129)
Listing expenses (14,301) (16,280) (12,323) (14,332)
Loss before tax (288,967) (249,570) (208,342) (129,495)
Income tax expense ––––
Loss for the year/period (288,967) (249,570) (208,342) (129,495)
Exchange differences on
translation of the financial
statements of subsidiaries 69 106 (4) (186)
Total comprehensive loss for
the year/period (288,898) (249,464) (208,346) (129,681)
FINANCIAL INFORMATION
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Other Income
During the Track Record Period, our other income mainly consisted of government grants
and other subsidies related to income and bank interest income.
Government grants have been received from the PRC local Governmental Authorities to
support the subsidiary’s operating activities. There are no unfulfilled conditions related to these
government grants. The establishment of the incentive programs and grant of such subsidies are
subject to the government’s discretion and the receipt of such subsidies is thus unpredictable.
Bank interest income comprised interest from bank deposits.
The following table sets forth a breakdown of our other income for the periods indicated:
Y ear Ended
December 31,
Nine Months Ended
September 30,
2022 2023 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
Other income
Government grants and other
subsidies related
to income 197 211 208 3,093
Bank interest income 5,567 11,145 8,601 5,554
Total 5,764 11,356 8,809 8,647
Other Gains and Losses, Net
During the Track Record Period, our other gains and losses mainly consisted of (i) foreign
exchange losses and gains; (ii) grants; (iii) donations; and (iv) loss from discontinued
procurement contract.
FINANCIAL INFORMATION
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During the Track Record Period, we held much of our cash and cash equivalents in US
dollars, and foreign exchange losses and gains represented the exchange differences of the
value of the foreign currency we held against the RMB resulted from fluctuations in exchange
rates. Grants mainly related to our grants to CHARD for rare diseases with cooperation on a
national patient registry and diagnosis consensus of ACH in the PRC. Donations related to our
donations to non-profit making organizations for the purpose of epidemic relief and public
welfare. Loss from discontinued procurement contract related to our cancellation of the
commitment to purchase the previously reserved drug substance under a commitment and
pre-payment agreement with Ascendis Pharma. In light of our commercial supply strategy
adjustment, on February 1, 2023, we exercised the right to cancel the commitment to purchase
the reserved drug substance under the commitment and pre-payment agreement. As such, we
shall compensate Ascendis Pharma for its losses pursuant to the relevant agreement, provided
that Ascendis Pharma shall use commercially reasonable efforts to mitigate the losses and that
such losses are evidenced by supporting documents and are detailed in the invoice.
The following table sets forth a breakdown of our other gains and losses for the periods
indicated:
Y ear Ended
December 31,
Nine Months Ended
September 30,
2022 2023 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
Other Gains and Losses, Net
Net foreign exchange
gains/(losses) 79,782 4,706 8,547 (120)
Grants (1,488) (1,407) (1,266) (268)
Donations (1,007) (473) (193) –
Loss on the disposal of property,
plant and equipment (103) (242) (242) –
Loss on termination of a lease
contract – (273) (273) –
Loss from a discontinued
procurement contract – (109,006) (109,006) –
Total 77,184 (106,695) (102,433) (388)
FINANCIAL INFORMATION
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Research and Development Costs
Our R&D costs consisted of: (i) contracting costs; (ii) raw materials and consumables;
(iii) staff costs; (iv) share-based payment expenses; (v) depreciation and amortization; (vi) cost
sharing; and (vii) others. Contracting costs and raw materials and consumables were mainly
related to engaging with CROs and facilitating projects. Staff costs consisted of wages and
salaries, bonuses and other employee benefits. Share-based payment expenses were incurred
from our grant of restricted share units in 2021 and 2022. Depreciation and amortization
mainly represented the depreciation of our leases under IFRS 16 and plant, property and
equipment. Cost sharing represented the costs incurred by us in connection with the Cost
Sharing and V olume Commitment Agreement we signed with Ascendis Pharma Endocrinology
Division in 2021. Others mainly included consulting service fees and general expenses
incurred for the purpose of R&D. The following table sets forth breakdowns by activity of our
R&D costs for the periods indicated:
Y ear ended
December 31,
Nine Months Ended
September 30,
2022 2023 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
Contracting costs 48,798 27,757 20,541 19,938
Raw materials and consumables 37,176 4,354 3,629 5,602
Staff costs 41,529 36,599 27,764 25,936
Share-based payment expenses 15,108 (29,334) (29,230) 1,442
Depreciation and amortization 3,929 3,625 2,915 1,895
Cost sharing 21,566 8,451 8,451 –
Others 11,440 6,238 4,013 4,094
Total 179,546 57,690 38,083 58,907
The R&D costs incurred for our Core Product, lonapegsomatropin, amounted to
RMB106.2 million, RMB28.7 million, RMB20.1 million and RMB24.4 million in 2022, 2023
and the nine months ended September 30, 2023 and 2024, respectively, accounting for 59.1%,
49.8%, 52.8% and 41.4% of our total R&D costs, respectively, for the same periods. The
decrease of R&D costs for lonapegsomatropin in 2023 was primarily due to (i) the decrease of
RMB27.4 million in raw materials and consumables cost mainly due to the centralized
procurement of quality control testing samples for the Core Product in 2022; (ii) the reversal
of certain share-based payment expenses of RMB17.9 million mainly in relation to the
retirement and resignation of relevant employees; (iii) the decrease of RMB13.1 million in
lonapegsomatropin drug substance cost sharing amount we incurred under the Cost Sharing and
V olume Commitment Agreement due to the completion of relevant project; and (iv) the
decrease of RMB12.8 million in contracting cost mainly as a result of the completion of Phase
3 pivotal trial in April 2022. The increase of R&D costs for lonapegsomatropin in the nine
FINANCIAL INFORMATION
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--- page 445 ---
months ended September 30, 2024 as compared to the same period in 2023 was primarily due
to the reversal of certain share-based payment expenses of RMB11.8 million mainly in relation
to the departure of relevant employee in the nine months ended September 30, 2023 and delay
in reaching certain milestone under the Equity Incentive Plan, partially offset by a decrease of
RMB8.5 million in the cost under the cost sharing arrangement as no such cost was incurred
in the nine months ended September 30, 2024.
We incurred RMB17.8 million, RMB9.4 million, RMB5.2 million and RMB15.2 million
on the development of TransCon CNP (navepegritide) in 2022, 2023 and the nine months ended
September 30, 2023 and 2024, respectively. The decrease of the R&D costs for TransCon CNP
(navepegritide) in 2023 was primarily due to the reversal of certain share-based payment
expenses of RMB10.1 million mainly in relation to the retirement of relevant employees. The
increase in the nine months ended September 30, 2024 as compared to the same period in 2023
was primarily due to (i) the reversal of certain share-based payment expenses of RMB6.9
million mainly in relation to the departure of relevant employees in the nine months ended
September 30, 2023 and delay in reaching certain milestone under the Equity Incentive Plan,
and (ii) an increase of RMB3.5 million in contracting costs as a result of the increased
activities in clinical data management and data analysis.
We incurred RMB55.5 million, RMB19.6 million, RMB12.8 million and RMB19.3
million on the development of palopegteriparatide in 2022, 2023 and the nine months ended
September 30, 2023 and 2024, respectively. The decrease of the R&D costs for
palopegteriparatide in 2023 was primarily due to (i) the reversal of certain share-based
payment expenses of RMB16.4 million mainly in relation to the retirement and resignation of
relevant employees; (ii) the decrease of RMB11.6 million in contracting costs mainly resulting
from the completion of the double-blind period of Phase 3 pivotal trial of palopegteriparatide
in China in January 2023; and (iii) the decrease of RMB5.1 million in raw materials and
consumables mainly resulting from the centralized procurement of drugs for clinical use in
2022 to meet the demands of China Phase 3 pivotal trial. The increase in the nine months ended
September 30, 2024 as compared to the same period in 2023 was primarily due to the reversal
of certain share-based payment expenses of RMB10.5 million mainly in relation to the
departure of relevant employees in the nine months ended September 30, 2023 and delay in
reaching certain milestone under the Equity Incentive Plan, partially offset by a decrease in
contracting costs of RMB4.7 million mainly as a result of the completion of the double-blind
period of Phase 3 pivotal trial of palopegteriparatide in China in January 2023.
FINANCIAL INFORMATION
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Administrative Expenses
Our administrative expenses consisted of: (i) staff costs; (ii) share-based payment
expenses; (iii) depreciation and amortization; (iv) consulting and legal service fees; (v) human
resources and recruitment service fees; and (vi) others. Staff costs consisted of wages and
salaries, bonuses and other employee benefits. Share-based payment expenses consisted of
administrative expenses associated with our grant of restricted share units in 2021 and 2022.
Depreciation and amortization mainly represented the depreciation of our lease under IFRS 16
and plant, property and equipment and amortization of intangible assets. Consulting and legal
service fees included fees relating to legal, consulting and translation services. Human
resources and recruitment service fees included fees in connection with recruitment activities.
Others mainly included traveling expenses and general expenses incurred for administrative
purposes.
The table below sets forth a breakdown of our administrative expenses for the periods
indicated:
Y ear ended
December 31,
Nine Months Ended
September 30,
2022 2023 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
Staff costs 49,823 42,305 34,784 23,346
Share-based payment expenses 78,400 17,068 13,643 26,962
Depreciation and amortization 3,576 3,371 2,688 1,818
Consulting and legal service fees 13,022 6,346 6,010 6,603
Human resources and recruitment
service fees 4,136 850 458 277
Others 28,492 10,004 6,481 5,380
Total 177,449 79,944 64,064 64,386
Finance Costs
Our finance costs represented interest on lease liabilities. We recorded finance costs of
RMB0.6 million, RMB0.3 million, RMB0.2 million and RMB0.1 million in 2022, 2023 and the
nine months ended September 30, 2023 and 2024, respectively.
FINANCIAL INFORMATION
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Listing Expenses
Our listing expenses represented expenses incurred for our proposed Listing and Global
Offering. We recorded listing expenses of RMB14.3 million, RMB16.3 million, RMB12.3
million and RMB14.3 million in 2022, 2023 and the nine months ended September 30, 2023
and 2024, respectively.
Income Tax
Our Group is subject to income tax on an entity basis on profits arising in or derived from
the jurisdictions in which members of the Group are domiciled and operate. We recorded no
income tax expense during the Track Record Period, due to our loss before taxation.
Cayman Islands
Under the current laws of the Cayman Islands, our Company is not subject to tax on
income or capital gains. In addition, upon payments of dividends by our Company to its
shareholders, no Cayman Islands withholding tax is imposed on our Company.
British Virgin Islands
Under the current laws of BVI, our subsidiary incorporated in BVI is not subject to tax
on income or capital gains. In addition, upon payments of dividends to us, no BVI withholding
tax is imposed on the subsidiary.
Hong Kong
Our subsidiary incorporated in Hong Kong is subject to Hong Kong profits tax at the
statutory rate of 16.5% on any estimated assessable profits arising in Hong Kong during the
Track Record Period. No Hong Kong profits tax was provided for as we did not generate any
assessable profits arising in Hong Kong during the Track Record Period.
China
Pursuant to the Corporate Income Tax Law of the PRC and the respective regulations, our
subsidiaries which operate in China are subject to income tax at a rate of 25% on the taxable
income during the Track Record Period. Pursuant to the Corporate Income Tax Law, VISEN
Shanghai enjoyed super deduction of 175% and 200% on qualifying R&D expenditures from
January 2022 to October 2022 and from November 2022 to April 2024, respectively, during the
Track Record Period.
Taiwan
The subsidiary incorporated in Taiwan is subject to Taiwan profits tax. The first
TWD120,000 of assessable profits of this subsidiary are not subject to tax and the remaining
assessable profits are taxed at 20%. No Taiwan profits tax was provided for as we did not
generate any assessable profits arising in Taiwan during the Track Record Period.
FINANCIAL INFORMATION
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--- page 448 ---
PERIOD-TO-PERIOD COMPARISON OF RESULTS OF OPERATIONS
Nine Months Ended September 30, 2024 Compared to Nine Months Ended September 30,
2023
Other Income
Our other income remained relatively stable at RMB8.8 million for the nine months ended
September 30, 2023 and RMB8.6 million for the nine months ended September 30, 2024.
Other Gains and Losses, Net
Our net other losses decreased from RMB102.4 million for the nine months ended
September 30, 2023 to RMB0.4 million for the nine months ended September 30, 2024,
primarily due to the loss from a discontinued procurement contract recorded in the amount of
RMB109.0 million in the nine months ended September 30, 2023 in relation to our cancellation
of the commitment to purchase the previously reserved drug substance under the commitment
and pre-payment agreement in February 2023, partially offset by the net foreign exchange
gains of RMB8.5 million in the nine months ended September 30, 2023 as compared to net
foreign exchange losses of RMB0.1 million in the same period in 2024 as a result of the US
dollars exchange rate appreciation against the Renminbi in the nine months ended September
30, 2023, yielding foreign exchange gains for the Group’s cash and cash equivalents
denominated in US dollars in that period.
Research and Development Costs
Our R&D costs increased from RMB38.1 million for the nine months ended September
30, 2023 to RMB58.9 million for the nine months ended September 30, 2024, primarily due to
the reversal of certain share-based payment expenses of RMB29.2 million mainly in relation
to the departure of relevant employees in the nine months ended September 30, 2023 and delay
in reaching certain milestone under the Equity Incentive Plan, partially offset by an decrease
of RMB8.5 million in costs under the cost sharing arrangement as no such cost was incurred
in the nine months ended September 30, 2024.
Administrative Expenses
Our administrative expenses remained relatively stable at RMB64.1 million for the nine
months ended September 30, 2023 and RMB64.4 million for the nine months ended
September 30, 2024.
Finance Costs
Our finance costs remained relatively stable at RMB0.2 million and RMB0.1 million for
the nine months ended September 30, 2023 and 2024, respectively.
FINANCIAL INFORMATION
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--- page 449 ---
Listing Expenses
Our listing expenses increased from RMB12.3 million for the nine months ended
September 30, 2023 to RMB14.3 million for the nine months ended September 30, 2024,
primarily due to the increased professional services provided by the Joint Sponsors, legal
counsels and other professional service providers in relation to the Listing.
Loss for the Period
As a result of the foregoing, our loss for the period decreased from RMB208.3 million for
the nine months ended September 30, 2023 to RMB129.5 million for the nine months ended
September 30, 2024.
Y ear Ended December 31, 2023 Compared to Y ear Ended December 31, 2022
Other Income
Our other income increased from RMB5.8 million in 2022 to RMB11.4 million in 2023,
primarily due to an increase of RMB5.6 million in bank interest income as the interest rate
increased for deposits denominated in the US dollars.
Other Gains and Losses, Net
We recorded net gains of RMB77.2 million in 2022, and recorded net losses of RMB106.7
million in 2023. The change was primarily due to (i) the loss from a discontinued procurement
contract recorded in the amount of RMB109.0 million in relation to our cancellation of the
commitment to purchase the previously reserved drug substance under the commitment and
pre-payment agreement in February 2023; and (ii) a decrease of RMB75.1 million in net
foreign exchange gains in 2023 as a result of the US dollars exchange rate appreciation against
the Renminbi by a relatively small margin and less cash and cash equivalent denominated in
US dollars.
Research and Development Costs
Our R&D costs decreased from RMB179.5 million in 2022 to RMB57.7 million in 2023,
primarily due to the decrease of R&D costs for lonapegsomatropin, TransCon CNP
(navepegritide) and palopegteriparatide of RMB77.5 million, RMB8.4 million and RMB35.9
million, respectively.
Administrative Expenses
Our administrative expenses decreased from RMB177.4 million in 2022 to RMB79.9
million in 2023, primarily due to the decrease in share-based payments and the consulting and
legal service fees.
FINANCIAL INFORMATION
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--- page 450 ---
Finance Costs
Our finance costs decreased from RMB0.6 million in 2022 to RMB0.3 million in 2023,
due to a decrease in the interest on lease liabilities in relation to the decrease of our lease
liabilities.
Listing Expenses
Our listing expenses increased from RMB14.3 million in 2022 to RMB16.3 million in
2023, primarily due to the increased professional services provided by the Joint Sponsors, legal
counsels and other professional service providers in relation to the Listing.
Loss for the Y ear
As a result of the foregoing, our loss for the year decreased from RMB289.0 million in
2022 to RMB249.6 million in 2023.
DISCUSSION OF CERTAIN SELECTED ITEMS FROM THE CONSOLIDATED
STATEMENTS OF FINANCIAL POSITION
The table below sets forth selected information from our consolidated statements of
financial position as of the dates indicated, which have been derived from the Accountants’
Report in Appendix I to this document:
As of December 31,
As of
September 30,
2022 2023 2024
RMB’000 RMB’000 RMB’000
NON-CURRENT ASSETS
Property, plant and equipment 2,352 876 371
Right-of-use assets 14,812 12,379 11,523
Intangible assets 1,415 567 69
Amount advanced to a related party – 39,193 39,193
Prepayments and other receivables 11,103 16,660 18,821
Total non-current assets 29,682 69,675 69,977
CURRENT ASSETS
Prepayments and other receivables 15,961 16,972 13,818
Amount advanced to a related party 69,171 9,367 12,494
Cash and cash equivalents 626,458 347,782 242,647
Total current assets 711,590 374,121 268,959
FINANCIAL INFORMATION
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--- page 451 ---
As of December 31,
As of
September 30,
2022 2023 2024
RMB’000 RMB’000 RMB’000
CURRENT LIABILITIES
Trade and other payables 49,460 37,582 38,289
Deferred income 2,900 2,900 –
Amounts due to related parties 30,311 8,790 8,061
Lease liabilities 4,668 2,552 2,389
Total current liabilities 87,339 51,824 48,739
Net current assets 624,251 322,297 220,220
Total assets less current liabilities 653,933 391,972 290,197
NON-CURRENT LIABILITIES
Lease liabilities 1,328 1,097 599
Total non-current liabilities 1,328 1,097 599
Net assets 652,605 390,875 289,598
EQUITY
Equity attributable to owners of
the Company
Share capital 70 70 70
Treasury shares (6) (6) (6)
Reserves 652,541 390,811 289,534
Total equity 652,605 390,875 289,598
FINANCIAL INFORMATION
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--- page 452 ---
Net Current Assets
The following table sets forth our current assets and current liabilities as of the dates
indicated:
As of December 31,
As of
September 30,
As of
January 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
CURRENT ASSETS
Prepayments and other
receivables 15,961 16,972 13,818 10,454
Amount advanced to a
related party 69,171 9,367 12,494 7,802
Cash and cash
equivalents 626,458 347,782 242,647 193,628
Total current assets 711,590 374,121 268,959 211,884
CURRENT
LIABILITIES
Trade and other
payables 49,460 37,582 38,289 37,976
Deferred income 2,900 2,900 – –
Amounts due to related
parties 30,311 8,790 8,061 11,014
Lease liabilities 4,668 2,552 2,389 1,865
Total current liabilities 87,339 51,824 48,739 50,855
Net current assets 624,251 322,297 220,220 161,029
We had net current assets of RMB161.0 million as of January 31, 2025, being the latest
practicable date for the purpose of liquidity disclosure in this document, which decreased from
RMB220.2 million as of September 30, 2024, primarily due to a decrease in cash and cash
equivalents from RMB242.6 million as of September 30, 2024 to RMB193.6 million as of
January 31, 2025 as a result of the operating costs associated with our R&D and administrative
activities.
Our net current assets decreased from RMB322.3 million as of December 31, 2023 to
RMB220.2 million as of September 30, 2024, primarily due to a decrease of RMB105.1 million
in cash and cash equivalents as a result of the operating costs associated with our R&D and
administrative activities.
FINANCIAL INFORMATION
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--- page 453 ---
Our net current assets decreased from RMB624.3 million as of December 31, 2022 to
RMB322.3 million as of December 31, 2023, primarily due to a decrease of RMB278.7 million
in cash and cash equivalents as a result of the operating costs associated with our R&D and
administrative activities and a decrease of RMB59.8 million in amount advanced to a related
party.
Prepayments and Other Receivables
Our prepayments and other receivables included rental deposits, value-added tax
recoverable, prepayments for R&D services, other prepayments and deferred share issue costs.
V alue-added tax recoverable represented value-added taxes incurred in clinical development,
office renovation and procurement of plant, property and equipment. The table below sets forth
a breakdown of our prepayments and other receivables as of the dates indicated:
As of December 31,
As of
September 30,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Non-current:
V alue-added tax recoverable 9,440 16,137 18,513
Rental deposits 1,663 523 308
11,103 16,660 18,821
Current:
Prepayments for research and
development services 6,951 5,308 5,783
Deferred share issue costs 5,669 6,053 4,518
Other prepayments 1,855 824 528
Bank interest receivable 1,391 4,036 2,410
Rental deposits 41 697 525
Other receivables 54 54 54
15,961 16,972 13,818
Total 27,064 33,632 32,639
FINANCIAL INFORMATION
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--- page 454 ---
Our prepayments and other receivables remained relatively stable at RMB33.6 million
and RMB32.6 million as of December 31, 2023 and September 30, 2024, respectively. Our
prepayments and other receivables increased from RMB27.1 million as of December 31, 2022
to RMB33.6 million as of December 31, 2023, primarily due to an increase of RMB6.7 million
in value-added tax recoverable mainly in relation to our research and development activities,
partially offset by a decrease of RMB1.6 million in prepayments for research and development
services as a result of our completion of the Phase 3 pivotal trial of the Core Product in April
2022. As of January 31, 2025, RMB6.0 million, representing 18.4% of the prepayments and
other receivables as of September 30, 2024 was subsequently settled. The rest of the unsettled
prepayments and other receivables primarily consist of rental deposits, prepayments for
research and development services, defer issue costs and value-added tax recoverable,
representing approximately 81.6% of the prepayments and other receivables as of September
30, 2024.
Cash and Cash Equivalents
Our cash and cash equivalents consisted of cash on hand and at banks, and short-term
highly liquid deposits. Our cash and cash equivalents decreased from RMB626.5 million as of
December 31, 2022 to RMB347.8 million as of December 31, 2023 and further to RMB242.6
million as of September 30, 2024, primarily due to the operating costs associated with our
R&D and administrative activities, payment for the loss resulted from discontinued
procurement contract related to our cancellation of the commitment to purchase the previously
reserved drug substance under a commitment and pre-payment agreement with Ascendis
Pharma and prepayments for future commercial supply of drug products.
Amount Advanced to a Related Party
Our amount advanced to a related party, as non-current asset and of trade nature,
increased from nil as of December 31, 2022 to RMB39.2 million as of December 31, 2023 and
remained the same as of September 30, 2024, as we made a payment of RMB39.2 million to
Ascendis Pharma for relevant drug products in November 2023 pursuant to the Commercial
Supply Agreement entered in October 2023. See “Connected Transactions – Non-Exempt and
Partially-Exempt Continuing Connected Transactions – Commercial Supply Agreement –
Pricing Policy” for more details.
Our amount advanced to a related party, as current asset and of trade nature, decreased
from RMB69.2 million as of December 31, 2022 to RMB9.4 million as of December 31, 2023,
primarily due to the write-off of the prepayment recorded in 2022 for the purchase of
previously reserved drug substance under a commitment and pre-payment agreement with
Ascendis Pharma, as we canceled our commitment to purchase such drug substance in 2023.
Our amount advanced to a related party, as current asset and of trade nature, increased from
RMB9.4 million as of December 31, 2023 to RMB12.5 million as of September 30, 2024,
primarily due to our prepayments for the suppliers for the regulatory filing purpose and
Technology Transfer and Localization.
FINANCIAL INFORMATION
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--- page 455 ---
Trade and Other Payables
Our trade and other payables primarily consisted of trade payables, accrued expenses for
R&D services, salary and discretionary bonus payables, other payables, accrued listing
expenses and other taxes payable. The table below sets forth a breakdown of our trade and
other payables as of the dates indicated:
As of December 31,
As of
September 30,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Trade payables 3,740 669 2,683
Accrued expenses for research and
development services 8,790 8,078 8,016
Salary and discretionary bonus
payables 11,815 13,316 12,819
Other payables 14,582 2,590 4,267
Accrued listing expenses 7,964 11,077 9,832
Other taxes payable 2,569 1,852 672
Total 49,460 37,582 38,289
Trade and other payables increased from RMB37.6 million as of December 31, 2023 to
RMB38.3 million as of September 30, 2024, primarily due to an increase of RMB2.0 million
in trade payables primarily driven by the progress in our research and development activities
and RMB1.7 million in other payables driven by the progress of land reclamation, partially
offset by a decrease of RMB1.2 million in accrued listing expenses and RMB1.2 million in
other taxes payable.
Trade and other payables decreased from RMB49.5 million as of December 31, 2022 to
RMB37.6 million as of December 31, 2023, primarily due to (i) a decrease of RMB12.0 million
in other payables as we made payments for consulting and design fees in 2023; and (ii) a
decrease of RMB3.1 million in trade payables, partially offset by an increase of RMB3.1
million in accrued listing expenses.
FINANCIAL INFORMATION
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--- page 456 ---
The following table sets forth an ageing analysis of our trade payables as of the dates
indicated, based on the invoice date:
As of December 31,
As of
September 30,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Within 3 months 3,740 669 2,683
As of January 31, 2025, RMB2.7 million, representing 100.0% of the trade payables as
of September 30, 2024 was subsequently settled.
Amounts Due to Related Parties
Our amounts due to related parties remained relatively stable at RMB8.8 million as of
December 31, 2023 and RMB8.1 million as of September 30, 2024.
Our amounts due to related parties decreased from RMB30.3 million as of December 31,
2022 to RMB8.8 million as of December 31, 2023, primarily due to the settlement of our
payment for the centralized procurement of quality control testing samples for the Core
Product and costs incurred by us in connection with the Cost Sharing and V olume Commitment
Agreement we signed with Ascendis Pharma.
LIQUIDITY AND CAPITAL RESOURCES
Overview
Our primary uses of cash are to fund the R&D of our Core Product and other pipeline
programs, administrative expenses and other recurring expenses. During the Track Record
Period, we incurred negative cash flows from our operations and substantially all of our
operating cash outflows resulted from our R&D costs and administrative expenses. Our net
cash used in operating activities was RMB246.5 million, RMB271.3 million and RMB102.4
million in 2022, 2023 and the nine months ended September 30, 2024, respectively. For further
details, please refer to the sub-section headed “– Cash Flows” in this section.
Our operating cash flow will continue to be affected by our R&D expenses and
administrative expenses. We expect to improve our net operating cash outflows position
following the approval and commercialization of our drug candidates in the future. During the
Track Record Period and up to the Latest Practicable Date, we funded our working capital
requirements through proceeds from private equity financing. Our management closely
monitors uses of cash and cash equivalents and strives to maintain a robust liquidity for our
operations. Going forward, we believe our liquidity requirements will be satisfied by a
combination of net proceeds from the Global Offering and cash generated from our operations.
We do not have any equity financing plan in the next six months from the expected date of the
Listing. As of September 30, 2024, our cash and cash equivalents amounted to RMB242.6
million.
FINANCIAL INFORMATION
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--- page 457 ---
Cash Flows
The following table sets forth a summary of our cash flows for the periods indicated:
Y ear Ended
December 31,
Nine Months Ended
September 30,
2022 2023 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Net cash flows used in operating
activities (246,549) (271,310) (155,734) (102,406)
Net cash flows used in investing
activities (1,766) (520) (348) (117)
Net cash flows used in financing
activities (7,949) (6,952) (4,816) (2,426)
Net decrease in cash and cash
equivalents (256,264) (278,782) (160,898) (104,949)
Cash and cash equivalents at
beginning of the year/period 882,653 626,458 626,458 347,782
Cash and cash equivalents at end
of the year/period 626,458 347,782 465,556 242,647
Operating Activities
During the Track Record Period, we incurred negative cash flows from our operations.
Substantially all of our operating cash outflows have resulted from our R&D costs and
administrative expenses.
In the nine months ended September 30, 2024, our net cash used in operating activities
was RMB102.4 million, which was primarily attributable to our loss before tax of RMB129.5
million, adjusted for non-cash items and changes in working capital. Positive adjustments
primarily included share-based payment expenses of RMB28.4 million. Negative adjustments
mainly included (i) an increase in amount advanced to a related party of RMB3.1 million and
(ii) a decrease in deferred income of RMB2.9 million.
In 2023, our net cash used in operating activities was RMB271.3 million, which was
primarily attributable to our loss before tax of RMB249.6 million, adjusted for non-cash items
and changes in working capital. Positive adjustments primarily included loss from discontinued
procurement contract of RMB69.2 million. Negative adjustments mainly included (i) a reversal
of share-based payment expenses of RMB12.3 million; (ii) a decrease in amounts due to related
parties of RMB21.5 million; (iii) an increase in amount advanced to a related party of
RMB48.6 million and (iv) a decrease in trade and other payables of RMB12.1 million.
FINANCIAL INFORMATION
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In 2022, our net cash used in operating activities was RMB246.5 million, which was
primarily attributable to our loss before tax of RMB289.0 million, adjusted for non-cash items
and changes in working capital. Positive adjustments primarily included: (i) share-based
payment expenses of RMB93.5 million; (ii) increase in amounts due to related parties of
RMB7.1 million; (iii) depreciation of right-of-use assets of RMB4.9 million; and (iv) increase
in trade and other payables of RMB4.4 million. Negative adjustments mainly included an
increase in amount advanced to a related party of RMB69.2 million.
We monitor and maintain a level of cash and cash equivalents deemed adequate by our
management to finance the operations and mitigate the effects of fluctuations in cash flows. In
view of our net operating cash outflows throughout the Track Record Period, we plan to
improve such position through the following initiatives: (i) advance our pipeline drug
candidates towards commercialization to generate revenue from product sales. Specifically,
subject to regulatory communications and marketing approval, we expect to receive BLA
approval for our Core Product for PGHD in China in the second half of 2025 and subsequently
launch the Core Product commercially; (ii) after the commercialization of our drug candidates,
we plan to closely monitor and manage the settlement of our trade receivables to avoid credit
losses. We will also closely monitor the settlement of our trade payables to achieve better cash
flow position; and (iii) in addition, we will continue to implement comprehensive measures to
effectively control our operating costs and better utilize our idle cash. For example, we have
set up a comprehensive budget management mechanism covering all types of costs and
expenses incurred in our daily operations, and strictly manage our budgets at the project and
business department levels.
Investing activities
In the nine months ended September 30, 2024, our net cash used in investing activities
was RMB0.1 million, which was due to the purchase of items of property, plant and equipment.
In 2023, our net cash used in investing activities was RMB0.5 million, which was due to
the purchase of items of property, plant and equipment.
In 2022, our net cash used in investing activities was RMB1.8 million, which was
primarily due to the purchase of items of property, plant and equipment of RMB1.5 million.
Financing activities
In the nine months ended September 30, 2024, our net cash used in financing activities
was RMB2.4 million, which was due to lease payments and related interests.
In 2023, our net cash used in financing activities was RMB7.0 million, which was
primarily due to: (i) lease payments and related interests of RMB4.9 million; and (ii) payment
of listing expenses of RMB2.0 million.
In 2022, our net cash used in financing activities was RMB7.9 million, which was
primarily due to: (i) lease payments and related interests of RMB5.8 million; and (ii) payment
of listing expense of RMB2.2 million.
FINANCIAL INFORMATION
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--- page 459 ---
WORKING CAPITAL
Our Directors are of the opinion that, taking into account the financial resources available
to our Group, including cash and cash equivalents and the estimated net proceeds from the
Listing, we have sufficient working capital to cover at least 125% of our costs, including R&D
costs and administrative expenses for at least the next 12 months from the expected date of this
document.
Our cash burn rate refers to the average monthly (i) net cash used in operating activities,
including clinical development and business development activities; (ii) capital expenditures;
and (iii) lease payments. We had cash and cash equivalents of RMB242.6 million as of
September 30, 2024. We estimate that we will receive net proceeds of approximately HK$570.8
million, equivalent to RMB526.5 million, after deducting the underwriting fees and expenses
payable by us in the Global Offering, assuming no Offer Size Adjustment Option and
Over-allotment Option are exercised and assuming an Offer Price of HK$68.44 per Offer
Share, being the low-end of the indicative Offer Price range in this document. We estimate that
our cash and cash equivalents as of September 30, 2024 will be able to maintain our financial
viability for 12 months or, if we take into account 6.6% of the estimated net proceeds from the
Listing (namely, the portion allocated for our working capital and other general corporate
purposes), 14 months or, if we also take into account the estimated net proceeds from the
Listing, 42 months. We will continue to monitor our cash flows from operations closely and
expect to raise our next round of financing, if needed, with a minimum buffer of 12 months.
CASH OPERATING COSTS
The following table sets forth our cash operating costs for the periods indicated:
Y ear Ended
December 31,
Nine Months Ended
September 30,
2022 2023 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
Costs Relating to Research and
Development of Our Core
Product, Lonapegsomatropin
Contracting costs 27,318 13,075 13,355 10,506
Raw materials and
consumables 20,705 10,662 10,209 1,172
Staff costs 18,163 16,065 12,891 12,261
Cost sharing 32,630 17,986 17,986 –
Others 7,896 2,708 2,559 3,663
Subtotal 106,712 60,496 57,000 27,602
FINANCIAL INFORMATION
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--- page 460 ---
Y ear Ended
December 31,
Nine Months Ended
September 30,
2022 2023 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
Costs Relating to Research and
Development of Other Drug
Candidates
Contracting costs 25,458 18,038 12,750 10,301
Raw materials and
consumables 5,200 5,271 4,784 1,471
Staff costs 22,504 18,816 15,629 13,610
Others 3,526 2,954 1,683 1,403
Subtotal 56,688 45,079 34,846 26,785
Workforce employment cost
(1) 47,179 38,174 32,969 25,087
Direct production cost ––––
Others (2) 47,713 39,632 28,453 24,779
Total 258,292 183,381 153,268 104,253
Notes:
(1) Workforce employment costs represented non-R&D staff costs, mainly including salaries and social
insurance contributions.
(2) Mainly consisted of consulting expense, listing expense, travelling expense and other miscellaneous
costs.
INDEBTEDNESS
The following table sets forth the breakdown of our indebtedness as of the dates
indicated:
As of December 31,
As of
September 30,
As of
January 31,
2022 2023 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Current
Lease liabilities 4,668 2,552 2,389 1,865
Non-current
Lease liabilities 1,328 1,097 599 280
Total 5,996 3,649 2,988 2,145
FINANCIAL INFORMATION
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--- page 461 ---
Except as presented above, we did not have any material mortgages, charges, debentures,
loan capital, debt securities, loans, unutilized bank facilities, bank overdrafts or other similar
indebtedness, finance lease or hire purchase commitments, liabilities under acceptances (other
than normal trade bills), acceptance credits, which are either guaranteed, unguaranteed, secured
or unsecured, or guarantees or other contingent liabilities as of the Latest Practicable Date. Our
Directors confirm that there has not been any material change in our indebtedness since
January 31, 2025 up to the date of this prospectus. Our Directors confirm that as of the Latest
Practicable Date, there was no material covenant on any of our outstanding debt and there was
no breach of any covenant during the Track Record Period and up to the Latest Practicable
Date. Our Directors further confirm that our Group did not experience any difficulty in
obtaining bank loans and other borrowings, default in payment of bank loans and other
borrowings or breach of covenants during the Track Record Period and up to the Latest
Practicable date.
CAPITAL EXPENDITURES
The following table sets forth our capital expenditures for the periods indicated:
Y ear Ended
December 31,
Nine Months Ended
September 30,
2022 2023 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Purchases of items of property,
plant and equipment 1,484 520 348 117
Payment for acquisition of land
use right 28 2–––
Total 1,766 520 348 117
Our historical capital expenditures during the Track Record Period primarily included
expenditure associated with the purchase of property, plant and equipment which mainly
consists of furniture and equipment and leasehold improvements. We funded our capital
expenditure requirements during the Track Record Period through equity financing.
CAPITAL COMMITMENTS
As of December 31, 2022 and 2023 and September 30, 2024, we had no capital
commitments contracted for but not yet provided.
FINANCIAL INFORMATION
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--- page 462 ---
CONTINGENT LIABILITIES
As of December 31, 2022 and 2023 and September 30, 2024, we did not have any
contingent liabilities. We confirm that as of the Latest Practicable Date, there had been no
material changes or arrangements to our contingent liabilities.
OFF-BALANCE SHEET COMMITMENTS AND ARRANGEMENTS
As of the Latest Practicable Date, we had not entered into any off-balance sheet
transactions.
KEY FINANCIAL RATIO
The table below sets forth the current ratio of our Group as of the dates indicated:
As of December 31,
As of
September 30,
2022 2023 2024
Current ratio (1) 8.15 7.22 5.52
Note:
(1) Current ratio equals current assets divided by current liabilities as of the same date.
Our current ratio decreased from 7.22 as of December 31, 2023 to 5.52 as of
September 30, 2024, mainly due to a decrease in our current assets from RMB374.1 million as
of December 31, 2023 to RMB269.0 million as of September 30, 2024, which was primarily
due to a decrease of RMB105.1 million in cash and cash equivalents as a result of the operating
costs associated with our R&D and administrative activities.
Our current ratio decreased from 8.15 as of December 31, 2022 to 7.22 as of December
31, 2023, mainly due to a decrease in our current assets from RMB711.6 million as of
December 31, 2022 to RMB374.1 million as of December 31, 2023, which was primarily due
to a decrease of RMB278.7 million in cash and cash equivalents as a result of the operating
costs associated with our R&D and administrative activities, payment for the loss resulted from
discontinued procurement contract related to our cancellation of the commitment to purchase
the previously reserved drug substance under a commitment and pre-payment agreement with
Ascendis Pharma and prepayments for future commercial supply of drug products. See “–
Discussion of Certain Selected Items from the Consolidated Statements of Financial Position
– Net Current Assets.”
FINANCIAL INFORMATION
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--- page 463 ---
RELATED-PARTY TRANSACTIONS
During the Track Record Period, we purchased investigational medicinal products as well
as R&D services primarily from our related parties, and entered into agreements, in accordance
with published prices and conditions agreed by us and the related parties.
The below table sets forth the transactions with related parties during the Track Record
Period.
Y ear Ended
December 31,
Nine Months
Ended September 30,
2022 2023 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Purchase of goods and cost
sharing
Ascendis Pharma
Endocrinology Division 50,667 8,451 8,451 7
Ascendis Pharma Growth
Disorders 714 243 243 –
Ascendis Pharma Bone
Diseases 5,256 451 451 3,310
56,637 9,145 9,145 3,317
Purchase of services
Ascendis Pharma
Endocrinology Division 12,832 9,261 5,678 6,681
Ascendis Pharma Growth
Disorders 440 3,059 1,971 6,253
Ascendis Pharma Bone
Diseases 1,320 895 629 98
14,592 13,215 8,278 13,032
Loss from a discontinued
procurement contract
Ascendis Pharma
Endocrinology Division – 109,006 109,006 –
FINANCIAL INFORMATION
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--- page 464 ---
The below table sets forth the outstanding balances with related parties during the Track
Record Period as of the dates indicated:
As of December 31,
As of
September 30,
2022 2023 2024
RMB’000 RMB’000 RMB’000
Amounts due to related parties
Trade payables
Ascendis Pharma Endocrinology
Division 23,623 230 2,120
Ascendis Pharma Bone Diseases 480 – 7
Ascendis Pharma Growth
Disorders 138 109 1,472
24,241 339 3,599
Accrued expenses
Ascendis Pharma Endocrinology
Division 2,145 6,785 1,143
Ascendis Pharma Bone Diseases 2,014 401 3,319
Ascendis Pharma Growth
Disorders 714 1,265 –
4,873 8,451 4,462
Other payables
Ascendis Pharma Endocrinology
Division 776 – –
Ascendis Pharma Bone Diseases 265 – –
Ascendis Pharma Growth
Disorders 156 – –
1,197 – –
30,311 8,790 8,061
Amount advanced to a related
party
Prepayments – current
Ascendis Pharma Endocrinology 69,171 9,367 12,494
Prepayments – non-current
Ascendis Pharma Endocrinology – 39,193 39,193
FINANCIAL INFORMATION
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--- page 465 ---
The outstanding balances above are unsecured, non-interest-bearing and repayable on
demand. The outstanding balances due to related parties and advanced to a related party were
business trade in nature. Our Directors confirm that our related party transactions during the
Track Record Period were conducted on an arm’s length basis, and that such transactions, in
the aggregate, would not distort the results of operations over the Track Record Period or make
the historical results over the Track Record Period not reflective of our expectations for future
performance.
Details of our transactions with and the outstanding balances with related parties during
the Track Record Period are set out in note 25 to the Accountants’ Report in Appendix I to this
document.
FINANCIAL RISK DISCLOSURE
We are exposed to a variety of financial risks, including foreign currency risk, credit risk
and liquidity risk, as set out below. We regularly monitor our exposure to these risks and as at
the Latest Practicable Date, did not hedge or consider necessary to hedge any of these risks.
Foreign Currency Risk
Foreign currency risk means the risk resulting from changes in foreign currency exchange
rates.
We have transactional currency exposures, arising from purchases by operating units in
currencies other than the units’ functional currencies. The majority of our cash and cash
equivalents are denominated in foreign currencies and are exposed to foreign currency risk. We
currently do not have a foreign currency hedging policy. However, our management monitors
foreign exchange exposure and will consider appropriate hedging measures in the future should
the need arise. See note 28 to the Accountants’ Report in Appendix I to this document for
further details, including relevant sensitivity analysis.
Credit Risk
For financial assets included in prepayments and other receivables, our management
makes periodic collective assessment as well as individual assessment on the recoverability of
other receivables based on historical settlement records and past experience. Our Directors
believe that there is no material credit risk inherent in our outstanding balance of other
receivables.
As of the end of the Track Record Period, cash and cash equivalents were deposited in
financial institutions without significant credit risk. See note 28 to the Accountants’ Report in
Appendix I to this document for further details.
Liquidity Risk
In the management of the liquidity risk, we monitor and maintain a level of cash and cash
equivalents deemed adequate by our management to finance the operations and mitigate the
effects of fluctuations in cash flows. See note 28 to the Accountants’ Report in Appendix I to
this document for further details.
FINANCIAL INFORMATION
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--- page 466 ---
DIVIDEND
No dividend has been paid or declared by our Company since its date of incorporation and
up to the end of the Track Record Period. Any declaration and payment as well as the amount
of dividends will be subject to our Memorandum of Association and the Cayman Companies
Act. We currently intend to retain all available funds and earnings, if any, to fund the
development and expansion of our business and we do not anticipate paying any cash dividends
in the foreseeable future. Investors should not purchase our ordinary shares with the
expectation of receiving cash dividends. The declaration and payment of dividends in the
future will be determined by our Board of Directors, in its discretion, or the Shareholders in
general meeting, and will depend on a number of factors, including our earnings, capital
requirements, and overall financial condition. As advised by our Cayman counsel, under the
Cayman Companies Act, a Cayman Islands company may pay a dividend out of either profits
or share premium account, provided that in no circumstances may a divided by paid if this
would result in the company being unable to pay its debts as they fall due in the ordinary course
of business. There is no assurance that dividends of any amount will be declared to be
distributed in any year.
DISTRIBUTABLE RESERVES
As of September 30, 2024, we did not have any distributable reserves.
LISTING-RELATED EXPENSE INCURRED AND TO BE INCURRED
Listing expenses mainly comprise legal and other professional fees paid and payable to
the professional parties, commissions payable to the Underwriters, and printing and other
expenses for their services rendered in relation to the Listing and the Global Offering. Listing
expenses for the Global Offering are estimated to be approximately HK$108.1 million,
including (i) underwriting-related expenses (including but not limited to commissions and fees)
of approximately HK$29.6 million and (ii) non-underwriting-related expenses of
approximately HK$78.5 million, comprising (a) fees and expenses of legal advisors and
accountants of approximately HK$64.3 million and (b) other fees and expenses of
approximately HK$14.2 million, at an Offer Price of HK$71.86 per Share, being the mid-point
of the indicative Offer Price range, which represents approximately 15.2% of the gross
proceeds we expect to receive from this Global Offering assuming no Shares are issued
pursuant to the Offer Size Adjustment Option and the Over-allotment Option and no Shares are
issued under the Post-IPO Share Award Scheme. RMB63.6 million (HK$68.9 million) was
recognized and charged to our consolidated statements of profit or loss and other
comprehensive income as of September 30, 2024. After September 30, 2024, approximately
HK$13.1 million is expected to be charged to our consolidated statements of profit or loss and
other comprehensive income, and approximately HK$26.1 million is expected to be charged
against equity upon the Listing. The listing expenses above are the latest practicable estimate
for reference only, and the actual amount may differ from this estimate.
FINANCIAL INFORMATION
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--- page 467 ---
UNAUDITED PRO FORMA STATEMENT OF ADJUSTED CONSOLIDATED NET
TANGIBLE ASSETS
The following unaudited pro forma statement of adjusted consolidated net tangible assets
of the Group prepared in accordance with Rule 4.29 of the Listing Rules is set out below to
illustrate the effect of the Global Offering on the consolidated net tangible assets of our Group
attributable to our owners as of September 30, 2024 as if the Global Offering had taken place
on such date.
The unaudited pro forma statement of adjusted consolidated net tangible assets has been
prepared for illustrative purposes only and because of its hypothetical nature, it may not give
a true and fair picture of the consolidated net tangible assets of our Group attributable to our
owners as of September 30, 2024 or at any further date following the Global Offering.
The following unaudited pro forma statement of adjusted consolidated net tangible assets
of our Group is prepared based on the audited consolidated net tangible liabilities of our Group
attributable to our owners as of September 30, 2024 as derived from the Accountants’ Report
set out in Appendix I to this prospectus and adjusted as described below.
Audited
consolidated net
tangible assets of
our Group
attributable to
our owners as of
September 30, 2024
Estimated net
proceeds from the
Global Offering
Unaudited pro
forma adjusted
consolidated
net tangible assets
attributable to our
owners as of
September 30, 2024
Unaudited pro forma
adjusted consolidated
net tangible assets
attributable to
our owners
per share as of
September 30, 2024
RMB’000 RMB’000 RMB’000 RMB HK$
(Note 1) (Note 2) (Note 3) (Note 4)
Based on offer price
HK$68.44 per offer
share 289,529 590,068 879,597 7.82 8.48
Based on offer price
HK$71.86 per offer
share 289,529 620,048 909,577 8.09 8.77
Based on offer price
HK$75.28 per offer
share 289,529 650,028 939,557 8.36 9.06
Notes:
(1) The consolidated net tangible assets of the Group attributable to equity holders of the Company as at
September 30, 2024 was equal to the audited net assets attributable to owners of the Company as at
September 30, 2024 of RMB289,598,000 after deducting of intangible assets of RMB69,000 as at
September 30, 2024 set out in the Accountants’ Report in Appendix I to this prospectus.
FINANCIAL INFORMATION
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--- page 468 ---
(2) The estimated net proceeds from the Global Offering are based on an Offer Price of HK$68.44,
HK$71.86 and HK$75.28, after deduction of the underwriting fees and other related expenses payable
by the Company (excluding the listing expense that have been charged to profit or loss as of September
30, 2024) and does not take into account any Shares which may be issued upon the exercise of the Offer
Size Adjustment Option and the Over-Allotment Option.
(3) The unaudited pro forma adjusted consolidated net tangible assets per Share is arrived at after
adjustments referred in note 2 above and on the basis of 112,441,864 Shares in issue, assuming that (i)
the Global Offering and (ii) the issuance of 330,000 Shares and cancellation of 765,000 Shares have
been completed on September 30, 2024 but does not take into account (i) any Shares which may be sold
pursuant to the Offer Size Adjustment Option or the exercise of the Over-allotment Option, or (ii) any
Shares which may be issued under the Post-IPO share incentive scheme.
(4) For the purpose of this unaudited pro forma statement of adjusted net tangible assets, the balances stated
in RMB are converted into HKD at the rate of RMB1.00 to HK$1.0841.
(5) No adjustment has been made to the unaudited pro forma adjusted consolidated net tangible assets to
reflect any trading results or other transactions of the Group entered into subsequent to September 30,
2024.
NO MATERIAL ADVERSE CHANGE
Our Directors confirm that, up to the date of this document, there has been no material
adverse change in our financial or trading position since September 30, 2024 (being the date
on which the latest consolidated financial information of our Group was prepared) and there
has been no event since September 30, 2024 which would materially affect the information
shown in our consolidated financial statements included in the Accountants’ Report in
Appendix I to this document.
IMPACT OF THE COVID-19 OUTBREAK
The outbreak of a novel strain of coronavirus causing COVID-19 since early 2020 has
materially and adversely affected the global economy. The COVID-19 pandemic and its
recurrence have caused temporary disruption to our business operations to the extent that
necessary on-site operations and R&D activities had to be put on hold temporarily and
transportation of consumables and other supplies necessary for our operations had to be
reduced during the affected period. However, the outbreak of COVID-19 had not caused any
early termination or suspension of our clinical trials, and during the Track Record Period and
up to the Latest Practicable Date, the COVID-19 pandemic did not have any material adverse
effect on our results of operations and financial position. With most restrictive measures lifted
since December 2022, we did not experience any disruption to our business operations in 2023
and the nine months ended September 30, 2024 due to the COVID-19 pandemic, and our
Directors are of the view that it is unlikely that there will be any material delays in regulatory
affairs regarding our drug candidates in the future or any long-term impact on our operations
or deviations from our overall development plans due to the COVID-19 pandemic. However,
we cannot assure you that the COVID-19 pandemic will not further escalate or have material
adverse effect on our performance in the future. See “Risk Factors — An occurrence of a
natural disaster, widespread health epidemic or other outbreaks could have a material adverse
effect on our business, financial condition and results of operations.”
FINANCIAL INFORMATION
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--- page 469 ---
DISCLOSURE UNDER RULES 13.13 TO 13.19 OF THE LISTING RULES
Our Directors confirm that, as at the Latest Practicable Date, there was no circumstance that
would give rise to a disclosure requirement under Rules 13.13 to 13.19 of the Listing Rules.
FINANCIAL INFORMATION
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--- page 470 ---
THE CORNERSTONE PLACING
We have entered into cornerstone investment agreements (each a “ Cornerstone
Investment Agreement ”, and together the “ Cornerstone Investment Agreements ”) with the
cornerstone investors set out below (each a “ Cornerstone Investor ”, and together the
“Cornerstone Investors ”), pursuant to which the Cornerstone Investors have agreed to,
subject to certain conditions, subscribe at the Offer Price for such number of Offer Shares
(rounded down to the nearest whole board lot of 100 Shares) that may be purchased for an
aggregate amount of US$72.0 million (or approximately HK$560.0 million, based on the
exchange rate set out in the section headed “Information about this Prospectus and the Global
Offering – Exchange Rate Conversion” in this prospectus) (exclusive of brokerage, SFC
transaction levy, Stock Exchange trading fee and AFRC transaction levy) (the “ Cornerstone
Placing ”). The number of Offer Shares to be subscribed for by the Cornerstone Investors are
subject to the determination of the final Offer Price.
Assuming an Offer Price of HK$68.44, being the low-end of the indicative Offer Price
range set out in this prospectus, the total number of Offer Shares to be subscribed by the
Cornerstone Investors would be 8,161,000 Offer Shares, representing approximately 82.4% of
the Offer Shares pursuant to the Global Offering, approximately 7.3% of the Shares in issue
upon completion of the Global Offering (assuming the Offer Size Adjustment Option is not
exercised, the Over-allotment Option is not exercised and no Shares are issued under the
Post-IPO Share Award Scheme).
Assuming an Offer Price of HK$71.86, being the mid-point of the indicative Offer Price
range set out in this prospectus, the total number of Offer Shares to be subscribed by the
Cornerstone Investors would be 7,772,600 Offer Shares, representing approximately 78.5% of
the Offer Shares pursuant to the Global Offering, approximately 6.9% of the Shares in issue
upon completion of the Global Offering (assuming the Offer Size Adjustment Option is not
exercised, the Over-allotment Option is not exercised and no Shares are issued under the
Post-IPO Share Award Scheme).
Assuming an Offer Price of HK$75.28, being the high-end of the indicative Offer Price
range set out in this prospectus, the total number of Offer Shares to be subscribed by the
Cornerstone Investors would be 7,419,300 Offer Shares, representing approximately 74.9% of
the Offer Shares pursuant to the Global Offering, approximately 6.6% of the Shares in issue
upon completion of the Global Offering (assuming the Offer Size Adjustment Option is not
exercised, the Over-allotment Option is not exercised and no Shares are issued under the
Post-IPO Share Award Scheme).
Among the Cornerstone Investors, Vivo Capital is one of the Controlling Shareholders of
our Company. Vivo Capital has been permitted to participate in the Cornerstone Placing
pursuant to paragraph 18 of Chapter 2.3 of the Guide under a waiver from strict compliance
with the requirements under Rule 9.09(b) and 10.04 of the Listing Rules, and a written consent
under paragraph 5(2) of Appendix F1 to the Listing Rules granted by the Stock Exchange. For
further details of the abovementioned waivers and consents, see “Waivers and Exemption” in
this prospectus.
CORNERSTONE INVESTORS
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--- page 471 ---
Our Company is of the view that, (i) the Cornerstone Placing will ensure a reasonable size
of solid commitment at the beginning of the marketing period of the Global Offering and will
provide confidence to the market; and (ii) by leveraging on the Cornerstone Investors’ industry
reputation and investment experience, in particular in the life sciences, healthcare and
biopharmaceutical sectors, the Cornerstone Placing will help raise the profile of our Company
and to signify that such investors have confidence in our business and prospect. Our Company
became acquainted with each of the Cornerstone Investors through the business network of our
Group or through our existing Shareholders or through the Capital Markets Intermediaries.
The Cornerstone Placing will form part of the International Offering and the Cornerstone
Investors will not subscribe for any Offer Shares under the Global Offering (other than
pursuant to the Cornerstone Investment Agreements). The Offer Shares to be subscribed by the
Cornerstone Investors will carry the same rights in all respects with the fully paid Shares in
issue and will be counted towards the public float of the Company under Rule 8.08 of the
Listing Rules (other than the Offer Shares to be subscribed by Vivo Capital) and in compliance
with the requirement under Rule 8.08(3) of the Listing Rules. Such Offer Shares will not count
towards the public float for the purpose of Rule 18A.07 of the Listing Rules. Immediately
following the completion of the Global Offering, (i) none of the Cornerstone Investors (other
than Vivo Capital) or their close associates will become a substantial shareholder of our
Company; (ii) none of the Cornerstone Investors (other than Vivo Capital) or their close
associates will have any Board representation in our Company. Other than a guaranteed
allocation of the relevant Offer Shares at the final Offer Price, the Cornerstone Investors do not
have any preferential rights in the Cornerstone Investment Agreements compared with other
public Shareholders. Upon completion of the Global Offering, over 25% of our issued share
capital will be held by the public as required under Rule 8.08(1)(a) of the Listing Rules and
shares with a market capitalization of at least HK$375 million will be held by the public as
required under Rule 18A.07 of the Listing Rules.
To the best knowledge of our Company after making reasonable enquiries, (i) each of the
Cornerstone Investors (other than Vivo Capital) is an Independent Third Party; (ii) none of the
Cornerstone Investors (other than Vivo Capital) is accustomed to take instructions from our
Company, our Directors, chief executive of our Company, our subsidiaries, Controlling
Shareholders, substantial Shareholders, existing Shareholders or their respective close
associates in relation to the acquisition, disposal, voting, or other disposition of Shares
registered in its name or otherwise held by it; and (iii) none of the subscription of the relevant
Offer Shares by any of the Cornerstone Investors (other than Vivo Capital) is financed by our
Company, our Directors, chief executive of our Company, Controlling Shareholders,
substantial Shareholders, existing Shareholders or any of its subsidiaries or their respective
close associates.
CORNERSTONE INVESTORS
– 461 –


--- page 472 ---
As confirmed by each of the Cornerstone Investors, their subscription under the
Cornerstone Placing would be financed by their own internal resources. Each of the
Cornerstone Investors has confirmed that all necessary approvals have been obtained with
respect to the Cornerstone Placing and that no specific approval from any stock exchange (if
relevant) or its shareholders is required for the relevant cornerstone investment. There are no
side arrangements or agreements between our Company and the Cornerstone Investors or any
benefit, direct or indirect, conferred on the Cornerstone Investors by virtue of or in relation to
the Listing, other than a guaranteed allocation of the relevant Offer Shares at the final Offer
Price.
The total number of Offer Shares to be subscribed by the Cornerstone Investors pursuant
to the Cornerstone Placing may be affected by reallocation of the Offer Shares between the
International Offering and the Hong Kong Public Offering in the event of over-subscription
under the Hong Kong Public Offering. Each of the Cornerstone Investors has agreed that if the
total demand for Shares in the Hong Kong Public Offering falls within the circumstances as set
out in the section headed “Structure of the Global Offering – The Hong Kong Public Offering
– Reallocation and Clawback” in this prospectus, the number of Offer Shares to be subscribed
by each Cornerstone Investor shall be reduced on a pro rata basis to satisfy the shortfall, after
taking into account the requirements under Appendix F1 to the Listing Rules. Details of the
actual number of Offer Shares to be allocated to the Cornerstone Investors will be disclosed in
the allotment results announcement of our Company to be published on or around March 20,
2025.
All of the Cornerstone Investors have confirmed that they have sufficient funds to settle
the investment amounts and they will pay and settle in full for the relevant Offer Shares that
they have subscribed before dealings in the Offer Shares commence on the Stock Exchange. As
such, there will be no deferred settlement of payment of the investment amounts. If there is
over-allocation in the International Offering, the settlement of such over-allocation may be
effected through delayed delivery of the Offer Shares to be subscribed by certain Cornerstone
Investors under the Cornerstone Placing. Where delayed delivery takes place, each Cornerstone
Investor that may be affected by such delayed delivery has agreed that it shall nevertheless pay
for the relevant Offer Shares before the Listing. If there is no over-allocation in the
International Offering, delayed delivery will not take place. As such, there will be no deferred
settlement of the investment amount for the Offer Shares to be subscribed by the Cornerstone
Investors pursuant to the Cornerstone Investment Agreements.
THE CORNERSTONE INVESTORS
The information about our Cornerstone Investors set forth below has been provided by
our Cornerstone Investors in connection with the Cornerstone Placing. Other than AnkeBio
(HongKong) Co., Limited and WuXi Biologics HealthCare V enture, none of the Cornerstone
Investors is a listed company or a subsidiary of a listed company.
CORNERSTONE INVESTORS
– 462 –


--- page 473 ---
AnkeBio
AnkeBio (HongKong) Co., Limited is a wholly owned subsidiary of Anhui Anke
Biotechnology (Group) Co., Ltd (“ AnkeBio ”). AnkeBio is an A-share listed company (stock
code: 300009.SZ) and a national high-tech enterprise with independent innovation capabilities,
focusing on the biopharmaceutical industry. It has participated in multiple national and
provincial research grants, including the National High-Tech Research and Development
Program (“࢕863೥”), the National Science and Technology Major Project (“ҦҸ
೥”), the National Key Torch Program (“೥”), the National Significant
New Drug Development Project (“ɽอᖹ௴Փ”), and numerous provincial science and
technology projects (“ҦҸᗫධͦ”). AnkeBio is dedicated to the research,
development, production, and sales of genetic engineering products, diagnostic products and
oncology drugs. Its subsidiaries are engaged in the research, development, production, and
sales of precision medicine, polypeptide APIs, biochemistry, traditional Chinese medicines and
novel DNA technology drugs.
Suzhou Harvest
Suzhou Harvest International Co., Limited (“ Suzhou Harvest ”) is incorporated in Hong
Kong with limited liability on November 27, 2023 and is wholly-owned by Suzhou Industrial
Park Industrial Investment Fund (Limited Partnership) (ږ(Υ
ྫ)) (“ SIP Industrial Investment Fund ”). SIP Industrial Investment Fund, established in the
PRC on November 7, 2017, primarily focuses on venture capital and equity investment, asset
management, investment management, and investment consultancy. The sole general partner as
well as the fund manager of SIP Industrial Investment Fund is Suzhou Y uanfeng Capital
Management Co. (ʮ̡)( “ Suzhou Yuanfeng ”), a limited company
incorporated in the PRC with a focus on private equity fund management service, holding 0.1%
partnership interest in SIP Industrial Investment Fund. The ultimate controller of Suzhou
Y uanfeng is Suzhou Industrial Park Zhaorun Investment Holding Group Co., Ltd ( ᘽψʈุ෤
ʮ̡), which is wholly-owned by Suzhou Industrial Park
Administrative Committee (ึ), a PRC governmental authority. The
remaining partnership interests of SIP Industrial Investment Fund are held as to 59.94% and
39.96% by Suzhou Industrial Park Economic Development Co. (ʮ
̡)( “ SIP Economic Development ”) and Suzhou Industrial Park State-owned Capital
Investment and Operation Holding Co. (ʮ̡)( “ SIP
State-owned Capital Holding ”) as limited partners. Both the SIP Economic Development and
SIP State-owned Capital Holding are held by Suzhou Industrial Park Administrative Committee
and Jiangsu Provincial Department of Finance as to 90% and 10%, respectively.
CORNERSTONE INVESTORS
– 463 –


--- page 474 ---
Vivo Capital
Vivo Capital is company incorporated under the laws of the Cayman Islands. Vivo Capital
is a wholly-owned subsidiary of Vivo Capital Fund IX (Cayman), L.P ., which is in turn
controlled by its general partner, Vivo Capital IX (Cayman), LLC. As of the Latest Practicable
Date, Vivo Capital Fund IX (Cayman), L.P . has over 40 limited partners, among which the
largest limited partner held less than 20% of its partnership interest. Vivo Capital IX (Cayman),
LLC. is beneficially owned by Frank Kung, Ed Engleman, Fu Shan, Mahendra Shah, Michael
J. CHANG and Jack Nielsen, other than Fu Shan and Michael J. CHANG, who are the
Directors of our Company, each of the voting members of Vivo Capital IX (Cayman), LLC. is
an Independent Third Party.
Vivo Funds are under the management of Vivo Capital LLC. Founded in 1996, Vivo
Capital LLC provides a multi-fund investment platform, covering private equity including
buyout, venture capital, and public equity. Funds managed by Vivo Capital LLC invest broadly
in healthcare across all fund strategies, including biotechnology, pharmaceuticals, medical
devices, and healthcare services, with a focus on the largest healthcare markets.
WuXi Biologics HealthCare Venture
WuXi Biologics HealthCare V enture (“ WuXi Biologics Venture ”) is a limited partnership
enterprise incorporated in Hong Kong. WuXi Biologics V enture is specialized in investing in
Biopharmaceutical, Biotechnological, Medical and Healthcare companies. WuXi Biologics
V enture is a wholly owned entity of WuXi Biologics (Cayman) Inc. (ʮ̡),
a leading open-access biologics CRDMO listed on the Stock Exchange (HKEX: 2269). All the
limited partnership interests of WuXi Biologics V enture are wholly owned by WuXi Biologics
(Cayman) Inc.
We will collaborate with WuXi Biologics (Shanghai) Co., Ltd. (“WuXi Biologics”), a
wholly-owned subsidiary of WuXi Biologics (Cayman) Inc. (ʮ̡) (HKEx
stock code: 2269), or the designated local CDMO, to manufacture lonapegsomatropin for
commercial supply in China (including Hong Kong, Macau and Taiwan).
Reynold Lemkins
The Reynold Lemkins Group (Asia) Limited (“ Reynold Lemkins ”) is an investment
institution established in Hong Kong in 2020. Reynold Lemkins is principally engaged in
investment activities in capital markets, and is committed to providing long-term value to and
industrialization of its invested companies from a long-term perspective.
Reynold Lemkins is wholly owned by Mr. Liu Haoran, an Independent Third Party of our
Group. Mr. Liu Haoran is currently the President and Chief Investment Officer of Reynold
Lemkins, responsible for strategic investments and risk management.
CORNERSTONE INVESTORS
– 464 –


--- page 475 ---
The table below sets forth details of the Cornerstone Placing:
Based on the Offer Price of HK$68.44 (being the low-end of the indicative Offer Price range)
Cornerstone Investor
Total
investment
amount
Number
of Offer
Shares to be
acquired (1)(2)
Assuming the Offer Size Adjustment Option is not exercised Assuming the Offer Size Adjustment Option is exercised in full
Assuming the Over-allotment Option
is not exercised
Assuming the Over-allotment Option
is exercised in full
Assuming the Over-allotment Option
is not exercised but the
Offer Size Adjustment Option is exercised
Assuming both the Over-allotment Option and
Offer Size Adjustment Option are exercised
Approximate
%o ft h e
international
Offer
Shares (2)
Approximate
%o ft h e
Offer
Shares (2)
Approximate
%o ft h e
issued share
capital (2)
Approximate
%o ft h e
international
Offer Shares (2)
Approximate
%o ft h e
Offer
Shares (2)
Approximate
%o ft h e
issued share
capital (2)
Approximate
%o ft h e
international
Offer
Shares (2)
Approximate
%o ft h e
Offer
Shares (2)
Approximate
%o ft h e
issued share
capital (2)
Approximate
%o ft h e
international
Offer Shares (2)
Approximate
%o ft h e
Offer
Shares (2)
Approximate
%o ft h e
issued share
capital (2)
(US$)
AnkeBio 30,000,000 (3) 3,409,000 38.3% 34.4% 3.0% 32.8% 29.9% 3.0% 33.3% 29.9% 3.0% 28.5% 26.0% 2.9%
Suzhou Harvest 18,000,000 (4) 2,024,900 22.7% 20.5% 1.8% 19.5% 17.8% 1.8% 19.8% 17.8% 1.8% 16.9% 15.5% 1.8%
Vivo Capital (5) 10,000,000 (3) 1,136,300 12.8% 11.5% 1.0% 10.9% 10.0% 1.0% 11.1% 10.0% 1.0% 9.5% 8.7% 1.0%
WuXi Biologics 10,000,000 (3) 1,136,300 12.8% 11.5% 1.0% 10.9% 10.0% 1.0% 11.1% 10.0% 1.0% 9.5% 8.7% 1.0%
Reynold Lemkins 4,000,000 (3) 454,500 5.1% 4.6% 0.4% 4.4% 4.0% 0.4% 4.4% 4.0% 0.4% 3.8% 3.5% 0.4%
Total 72,000,000 8,161,000 91.6% 82.4% 7.3% 78.5% 71.7% 7.2% 79.6% 71.7% 7.2% 68.3% 62.3% 7.1%
CORNERSTONE INVESTORS
– 465 –


--- page 476 ---
Based on the Offer Price of HK$71.86 (being the mid-point of the indicative Offer Price range)
Cornerstone Investor
Total
investment
amount
Number
of Offer
Shares to be
acquired (1)(2)
Assuming the Offer Size Adjustment Option is not exercised Assuming the Offer Size Adjustment Option is exercised in full
Assuming the Over-allotment Option
is not exercised
Assuming the Over-allotment Option
is exercised in full
Assuming the Over-allotment Option
is not exercised but the
Offer Size Adjustment Option is exercised
Assuming both the Over-allotment Option and
Offer Size Adjustment Option are exercised
Approximate
%o ft h e
international
Offer
Shares (2)
Approximate
%o ft h e
Offer
Shares (2)
Approximate
%o ft h e
issued share
capital (2)
Approximate
%o ft h e
international
Offer Shares (2)
Approximate
%o ft h e
Offer
Shares (2)
Approximate
%o ft h e
issued share
capital (2)
Approximate
%o ft h e
international
Offer
Shares (2)
Approximate
%o ft h e
Offer
Shares (2)
Approximate
%o ft h e
issued share
capital (2)
Approximate
%o ft h e
international
Offer Shares (2)
Approximate
%o ft h e
Offer
Shares (2)
Approximate
%o ft h e
issued share
capital (2)
(US$)
AnkeBio 30,000,000 (3) 3,246,700 36.4% 32.8% 2.9% 31.2% 28.5% 2.8% 31.7% 28.5% 2.8% 27.2% 24.8% 2.8%
Suzhou Harvest 18,000,000 (4) 1,928,600 21.6% 19.5% 1.7% 18.6% 16.9% 1.7% 18.8% 16.9% 1.7% 16.1% 14.7% 1.7%
Vivo Capital (5) 10,000,000 (3) 1,082,200 12.1% 10.9% 1.0% 10.4% 9.5% 0.9% 10.6% 9.5% 0.9% 9.1% 8.3% 0.9%
WuXi Biologics 10,000,000 (3) 1,082,200 12.1% 10.9% 1.0% 10.4% 9.5% 0.9% 10.6% 9.5% 0.9% 9.1% 8.3% 0.9%
Reynold Lemkins 4,000,000 (3) 432,900 4.9% 4.4% 0.4% 4.2% 3.8% 0.4% 4.2% 3.8% 0.4% 3.6% 3.3% 0.4%
Total 72,000,000 7,772,600 87.2% 78.5% 6.9% 74.8% 68.3% 6.8% 75.9% 68.3% 6.8% 65.0% 59.4% 6.7%
CORNERSTONE INVESTORS
– 466 –


--- page 477 ---
Based on the Offer Price of HK$75.28 (being the high-end of the indicative Offer Price range)
Cornerstone Investor
Total
investment
amount
Number
of Offer
Shares to be
acquired (1)(2)
Assuming the Offer Size Adjustment Option is not exercised Assuming the Offer Size Adjustment Option is exercised in full
Assuming the Over-allotment Option
is not exercised
Assuming the Over-allotment Option
is exercised in full
Assuming the Over-allotment Option
is not exercised but the
Offer Size Adjustment Option is exercised
Assuming both the Over-allotment Option and
Offer Size Adjustment Option are exercised
Approximate
%o ft h e
international
Offer
Shares (2)
Approximate
%o ft h e
Offer
Shares (2)
Approximate
%o ft h e
issued share
capital (2)
Approximate
%o ft h e
international
Offer Shares (2)
Approximate
%o ft h e
Offer
Shares (2)
Approximate
%o ft h e
issued share
capital (2)
Approximate
%o ft h e
international
Offer
Shares (2)
Approximate
%o ft h e
Offer
Shares (2)
Approximate
%o ft h e
issued share
capital (2)
Approximate
%o ft h e
international
Offer Shares (2)
Approximate
%o ft h e
Offer
Shares (2)
Approximate
%o ft h e
issued share
capital (2)
(US$)
AnkeBio 30,000,000 (3) 3,099,200 34.8% 31.3% 2.8% 29.8% 27.2% 2.7% 30.2% 27.2% 2.7% 25.9% 23.7% 2.7%
Suzhou Harvest 18,000,000 (4) 1,840,900 20.7% 18.6% 1.6% 17.7% 16.2% 1.6% 18.0% 16.2% 1.6% 15.4% 14.1% 1.6%
Vivo Capital (5) 10,000,000 (3) 1,033,000 11.6% 10.4% 0.9% 9.9% 9.1% 0.9% 10.1% 9.1% 0.9% 8.6% 7.9% 0.9%
WuXi Biologics 10,000,000 (3) 1,033,000 11.6% 10.4% 0.9% 9.9% 9.1% 0.9% 10.1% 9.1% 0.9% 8.6% 7.9% 0.9%
Reynold Lemkins 4,000,000 (3) 413,200 4.6% 4.2% 0.4% 4.0% 3.6% 0.4% 4.0% 3.6% 0.4% 3.5% 3.2% 0.4%
Total 72,000,000 7,419,300 83.3% 74.9% 6.6% 71.4% 65.2% 6.5% 72.4% 65.2% 6.5% 62.1% 56.7% 6.4%
Notes:
(1) Calculated based on the exchange rate set out at US$1.0 : HK$7.7771 in the section headed “Information about this Prospectus and the Global Offerin g – Exchange Rate
Conversion” in this prospectus and rounded down to the nearest whole board lot of 100 Shares.
(2) Assuming the Offer Size Adjustment Option is not exercised.
(3) Exclusive of brokerage, SFC transaction levy, AFRC transaction levy and the Stock Exchange trading fee.
(4) Inclusive of brokerage, SFC transaction levy, AFRC transaction levy and the Stock Exchange trading fee.
(5) Without taking into account of the Shares beneficially owned by Vivo Capital prior to the cornerstone subscription.
CORNERSTONE INVESTORS
– 467 –


--- page 478 ---
CLOSING CONDITIONS
The obligation of the Cornerstone Investors to acquire the Offer Shares under the
Cornerstone Investment Agreements is subject to, among other things, the following closing
conditions:
(a) the Underwriting Agreements being entered into and having become effective and
unconditional (in accordance with their respective original terms or as subsequently
waived or varied by agreement of the parties thereto) by no later than the time and
date as specified in the Underwriting Agreements, and neither the Underwriting
Agreements having been terminated;
(b) the Offer Price having been agreed upon between our Company and the Overall
Coordinators (for themselves and on behalf of the Underwriters);
(c) the Listing Committee of Stock Exchange having granted the listing of, and
permission to deal in, the Shares in issue, the Shares to be issued pursuant to the
Global Offering (including the Shares under the Cornerstone Placing as well as other
applicable waivers and consents and any Shares that may be issued under the
Offer-size Adjustment Option and the Over-allotment Option) and the Shares which
may be issued pursuant to the Post-IPO Share Award Scheme and such approval,
permission, waivers or consents having not been revoked prior to the
commencement of dealings in the Shares on the Stock Exchange;
(d) no laws (as defined in the respective Cornerstone Investment Agreement) shall have
been enacted or promulgated by any governmental authority which prohibits the
consummation of the transactions contemplated in the Global Offering or the
Cornerstone Investment Agreements, and there shall be no orders or injunctions
from a court of competent jurisdiction in effect precluding or prohibiting
consummation of such transactions; and
(e) the respective representations, warranties, undertakings, acknowledgements and
confirmations of the Cornerstone Investors under their respective Cornerstone
Investment Agreements are (as of the date of the Cornerstone Investment
Agreements) and will be (as of the Listing Date) accurate and true in all respects and
not misleading and that there is no material breach of the Cornerstone Investment
Agreements on the part of the Cornerstone Investors.
RESTRICTIONS ON THE CORNERSTONE INVESTORS
Each of the Cornerstone Investors has agreed that without the prior written consent of
each of the Company, the Joint Sponsors and the Overall Coordinators, it will not, whether
directly or indirectly, at any time during the period commencing from (and inclusive of) the
Listing Date and ending on (and inclusive of) the date falling six (6) months after Listing Date
(the “ Lock-up Period ”), (i) dispose of, in any way, any of the Offer Shares it has subscribed
for or any interest in any company or entity holding any of such Offer Shares, including any
securities convertible into or exchangeable or exercisable for or that represent the right to
receive any of the forgoing securities, pursuant to the relevant Cornerstone Investment
Agreements; (ii) agree or contract to, or publicly announce any intention to, enter into any such
transaction described in (i); or (iii) enter into any transactions directly or indirectly with the
same economic effect as any aforesaid transactions.
CORNERSTONE INVESTORS
– 468 –


--- page 479 ---
FUTURE PLANS
See “Business – Our Strategies” for details of our future plans.
USE OF PROCEEDS
Assuming an Offer Price of HK$71.86, being the mid-point of the indicative Offer Price
range, and after deducting estimated underwriting fees and the estimated offering expenses in
connection with the Hong Kong Public Offering and International Offering, and the Offer Size
Adjustment Option and the Over-allotment Option are not exercised, we estimate that the
aggregate net proceeds from the Global Offering will be approximately HK$603.3 million.
In line with our strategies, we intend to use the net proceeds we will receive from the
Global Offering for the following purposes, subject to changes in light of our evolving business
needs and changing market conditions:
(a) Approximately HK$506.9 million (representing 84.0% of net proceeds) to fund the
ongoing BLA registration of imported Core Product, ongoing and planned research
and development and BLA registration of locally manufactured Core Product,
planned clinical trial on new indication expansion, and planned commercial launch
of our Core Product, lonapegsomatropin, of which:
(i) Approximately HK$42.5 million (representing 7.0% of net proceeds) to fund
the ongoing BLA registration of imported Core Product (the “Import BLA”)
subsequent to the acceptance of our BLA filing by the NMPA in March 2024
to support our efforts in obtaining the marketing approval to import and
commercialize lonapegsomatropin sourced from Ascendis Pharma, primarily
including (1) labor costs of our clinical development, regulatory affairs and
CMC personnel who will continue to support us in obtaining the Import BLA
approval, (2) costs incurred in relation to requests from the CDE of the NMPA
for additional information or clarification, such as test methods development
and validation and (3) costs incurred in purchasing drug substance and drug
product samples to prepare for the pre-approval quality control testing
conducted by the NMPA.
FUTURE PLANS AND USE OF PROCEEDS
– 469 –


--- page 480 ---
(ii) Approximately HK$123.1 million (representing 20.4% of net proceeds) to fund
the ongoing and planned research and development and BLA registration of
locally manufactured Core Product for PGHD (the “Local BLA”), which will
enable us to commercialize the locally manufactured lonapegsomatropin in
China, of which:
(1) Approximately HK$96.5 million (representing 16.0% of net proceeds) to
fund the pharmaceutical/CMC studies required by the NMPA for the
purpose of Local BLA registration of PGHD, which cover the
lonapegsomatropin drug substance and drug product development. For
the lonapegsomatropin drug substance, from 2024 to 2026, by
collaborating with Ascendis Pharma and WuXi Biologics, we will
conduct the lab-scale drug substance study, drug substance analytical
method transfer, development and validation, the engineering run and the
process validation studies for the purpose of Local BLA registration. For
the drug product development, from 2024 to 2027, by collaborating with
WuXi Biologics, we expect to conduct the DCD development and process
characterization studies, process scale-up and process validation studies
to ensure at-scale production of DCD products for the purpose of Local
BLA registration.
(2) Approximately HK$26.7 million (representing 4.4% of net proceeds) to
fund the Local BLA registration. The activities in relation to such
registration cover drug testing by the National Institutes for Food and
Drug Control of locally produced products against the proposed quality
standards, generating stability data of the drug substance and drug
product to support the Local BLA filing, and the preparation and
submission of the Local BLA dossier.
(iii) Approximately HK$190.9 million (representing 31.7% of net proceeds) to fund
the planned clinical studies of the Core Product for the treatment of an
additional indication, idiopathic short stature, which will require a
supplemental application to the NMPA. We intend to conduct a multi-center,
randomized, open-label, active-controlled, parallel-group Phase 2b/3 trial to
investigate the efficacy and safety of Core Product in children with ISS. The
local manufacturing of lonapegsomatropin PPQ drug products will be used as
investigational medicinal product (“IMP”) in the Phase 2b/3 trial for ISS. We
plan to prepare the study design, develop the study protocol synopsis,
manufacture IMP for clinical trial, conduct the necessary CMC and non-
clinical studies, and apply for pre-IND communication with NMPA following
the completion of the Listing. See “Business – Our Drug Pipeline –
Lonapegsomatropin – A Long-Acting hGH Replacement Therapy for PGHD –
Future Clinical Development Plan” for more details.
FUTURE PLANS AND USE OF PROCEEDS
– 470 –


--- page 481 ---
(iv) Approximately HK$150.4 million (representing 24.9% of net proceeds) to fund
the payment for the commercial supply of lonapegsomatropin from Ascendis
Pharma pursuant to the existing Commercial Supply Agreement, and potential
future commercial supply agreement for our commercial sale of
lonapegsomatropin in China under the Import BLA, before our collaborative
local manufacturing capability is established.
(b) Approximately HK$45.7 million (representing 7.6% of net proceeds) to fund the
ongoing OLE portion of China Phase 3 pivotal trial and preparation for commercial
launch of palopegteriparatide, including to fund the ongoing OLE portion of China
Phase 3 pivotal trial, of palopegteriparatide for the treatment of adult HP and the
preparation of regulatory filings, and once approved, the commercialization of
palopegteriparatide in China for the treatment of adult HP .
(c) Approximately HK$10.7 million (representing 1.8% of net proceeds) to fund the
ongoing OLE portion of China Phase 2 trial of TransCon CNP (navepegritide) and
relevant analysis for the treatment of ACH.
(d) Approximately HK$40.0 million (representing 6.6% of net proceeds) to fund our
working capital and other general corporate purposes.
If the Offer Price is set at the high point or the low point of the indicative Offer Price
range (assuming the Offer Size Adjustment Option and the Over-allotment Option are not
exercised and no Shares are issued under the Post-IPO Share Award Scheme), the net proceeds
will increase or decrease by approximately HK$32.5 million. We will apply the additional or
reduced net proceeds to the above purposes on a pro-rata basis.
If the Offer Size Adjustment Option and the Over-allotment Option are exercised in full,
we will receive additional net proceeds of approximately HK$220.2 million, assuming an Offer
Price of HK$71.86 per Share, being the mid-point of the indicative Offer Price range.
If the net proceeds are not immediately applied to the above purpose, we will only deposit
those net proceeds into short-term interest-bearing accounts at licensed commercial banks
and/or other authorized financial institutions (as defined under the Securities and Futures
Ordinance or applicable laws and regulations in other jurisdictions).
We currently have no specific plans as to how the net proceeds from this Global Offering
will be allocated beyond the uses specified above, and therefore management will retain
discretion to allocate the remainder of the net proceeds of this Global Offering among these
uses.
FUTURE PLANS AND USE OF PROCEEDS
– 471 –


--- page 482 ---
This expected use of the net proceeds from this Global Offering represents our intentions
based upon our current plans and business conditions. As of the Latest Practicable Date, we
could not predict with certainty all of the particular uses for the net proceeds to be received
upon the completion of this Global Offering or the amounts that we will actually spend on the
uses set forth above. The amounts and timing of our actual expenditures and the extent of
clinical development may vary significantly depending on numerous factors, including the
progress of our drug development programs, the status of and results from pre-clinical studies
and any ongoing clinical trials or clinical trials we may commence in the future, as well as any
collaborations that we may enter into with third parties for our drug candidates and any
unforeseen cash needs. As a result, our management will retain broad discretion over the
allocation of the net proceeds from this Global Offering and may change the allocation of use
of these proceeds among the uses described above. An investor will not have the opportunity
to evaluate the economic, financial or other information on which we base our decisions on
how to use the proceeds.
We will issue an appropriate announcement if there is any material change in the
abovementioned use of proceeds.
FUTURE PLANS AND USE OF PROCEEDS
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--- page 483 ---
HONG KONG UNDERWRITERS
Morgan Stanley Asia Limited
Jefferies Hong Kong Limited
CLSA Limited
Futu Securities International (Hong Kong) Limited
Guoyuan Securities Brokerage (Hong Kong) Limited
Soochow Securities International Brokerage Limited
(in alphabetical order)
Patrons Securities Limited
Ruibang Securities Limited
(in alphabetical order)
UNDERWRITING
This prospectus is published solely in connection with the Hong Kong Public Offering.
The Hong Kong Public Offering is fully underwritten by the Hong Kong Underwriters on a
conditional basis. The International Offering is expected to be fully underwritten by the
International Underwriters. If, for any reason, the Offer Price is not agreed between the Joint
Global Coordinators and the Overall Coordinators (on behalf of the Underwriters) and the
Company, the Global Offering will not proceed and will lapse.
The Global Offering comprises the Hong Kong Public Offering of initially 990,000 Hong
Kong Offer Shares and the International Offering of initially 8,910,000 International Offer
Shares, subject, in each case, to reallocation on the basis as described in the section headed
“Structure of the Global Offering” in this prospectus as well as to the Offer Size Adjustment
Option and the Over-allotment Option (in the case of the International Offering).
UNDERWRITING ARRANGEMENTS AND EXPENSES
Hong Kong Public Offering
Hong Kong Underwriting Agreement
The Hong Kong Underwriting Agreement was entered into on March 12, 2025. Pursuant
to the Hong Kong Underwriting Agreement, the Company is offering the Hong Kong Offer
Shares for subscription on the terms and conditions set out in this prospectus and the Hong
Kong Underwriting Agreement at the Offer Price.
Subject to (a) the Listing Committee granting approval for the listing of, and permission
to deal in, the Shares in issue, the Shares to be issued pursuant to the Global Offering
(including any Shares that may be issued pursuant to the Offer Size Adjustment Option and the
Over-allotment Option) and the Shares which may be issued pursuant to the Post-IPO Share
Award Scheme on the Main Board of the Stock Exchange and such approval not having been
subsequently revoked prior to the commencement of trading of the Shares on the Stock
Exchange and (b) certain other conditions set out in the Hong Kong Underwriting Agreement,
the Hong Kong Underwriters have agreed severally but not jointly to procure subscribers for,
or themselves to subscribe for, their respective applicable proportions of the Hong Kong Offer
Shares being offered which are not taken up under the Hong Kong Public Offering on the terms
and conditions set out in this prospectus and the Hong Kong Underwriting Agreement.
UNDERWRITING
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The Hong Kong Underwriting Agreement is conditional on, among other things, the
International Underwriting Agreement having been executed and becoming unconditional and
not having been terminated in accordance with its terms.
Grounds for termination
If any of the events set out below occur at any time prior to 8:00 a.m. on the Listing Date,
the Joint Global Coordinators and the Overall Coordinators (for themselves and on behalf of
the Hong Kong Underwriters) shall be entitled by written notice to the Company to terminate
the Hong Kong Underwriting Agreement with immediate effect:
(a) there develops, occurs, exists or comes into force:
(i) any event, or series of events, in the nature of force majeure (including,
without limitation, any acts of government, declaration of a regional, national
or international emergency or war, calamity, crisis, epidemic, pandemic, large
scale outbreaks of diseases or its escalation, mutation or aggravation
(including, without limitation, SARS, swine or avian flu, H5N1, H1N1, H7N9,
contagious coronavirus (COVID-19) and such related/mutated forms), accident
or interruption or delay in transportation, economic sanctions, strikes, labour
disputes, lock-outs, fire, explosion, flooding, tsunami, earthquake, volcanic
eruption, civil commotion, riots, rebellion, public disorder, acts of war,
outbreak or escalation of hostilities (whether or not war is declared), acts of
God or acts of terrorism (whether or not responsibility has been claimed)) in
or affecting Hong Kong, Taiwan, the PRC, the Cayman Islands, the BVI, the
United States, Singapore, the United Kingdom or the European Union (or any
member thereof) or any other jurisdiction relevant to the Group (collectively,
the “ Relevant Jurisdictions ”);
(ii) any change or development involving a prospective change, or any event or
circumstances or series of events likely to result in any change or development
involving a prospective change, in any local, national, regional or international
financial, economic, political, military, industrial, legal, fiscal, regulatory,
currency, credit or market matters or conditions, equity securities or exchange
control or any monetary or trading settlement system or other financial markets
(including, without limitation, conditions in the stock and bond markets,
money and foreign exchange markets, the interbank markets and credit
markets), in or affecting any of the Relevant Jurisdictions;
(iii) any moratorium, suspension or restriction (including, without limitation, any
imposition of or requirement for any minimum or maximum price limit or price
range) in or on trading in securities generally on SEHK, the New Y ork Stock
Exchange, the NASDAQ Global Market, the London Stock Exchange, the
Shanghai Stock Exchange, the Shenzhen Stock Exchange, Singapore Stock
Exchange or the Tokyo Stock Exchange;
UNDERWRITING
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(iv) any general moratorium on commercial banking activities in Hong Kong
(imposed by the Financial Secretary or the Hong Kong Monetary Authority or
other competent authority), New Y ork (imposed at the U.S. Federal or New
Y ork State level or by any other competent authority), London, the PRC, the
European Union (or any member thereof), Japan, Singapore or any of the other
Relevant Jurisdictions (declared by the relevant authorities) or any disruption
in commercial banking or foreign exchange trading or securities settlement or
clearance services, procedures or matters in or affecting any of the Relevant
Jurisdictions;
(v) any new law or regulation or any change or any development involving a
prospective change or any event or circumstance likely to result in a change or
a development involving a prospective change in existing laws or regulations
or any change or development involving a prospective change in the
interpretation or application thereof by any court or any competent
Governmental Authority in or affecting any of the Relevant Jurisdictions;
(vi) the imposition of sanctions, or the withdrawal of trading privileges, in
whatever form, directly or indirectly, by any Governmental Authority of any
Relevant Jurisdiction that is relevant to the business operations of any member
of the Group;
(vii) any change or development involving a prospective change or amendment in
or affecting taxation or foreign exchange control, currency exchange rates or
foreign investment regulations (including, without limitation, a material
devaluation of the Hong Kong dollar or RMB against any foreign currencies,
a change in the system under which the value of the Hong Kong dollar is linked
to that of the United States dollar or RMB is linked to any foreign currency or
currencies), or the implementation of any exchange control, in any of the
Relevant Jurisdictions or adversely affecting an investment in the Offer Shares;
(viii) a Director or a member of the Group’s senior management as named in this
document being charged with an indictable offence or prohibited by operation
of Law or otherwise disqualified from taking part in the management or taking
directorship of a company;
(ix) other than with the prior written consent of the Joint Global Coordinators and
the Overall Coordinators, the issue or requirement to issue by the Company of
a supplement or amendment to this document or other documents in connection
with the offer and sale of the Offer Shares pursuant to the Companies (Winding
Up and Miscellaneous Provisions) Ordinance or the Listing Rules, or upon any
requirement or request of Stock Exchange and/or the SFC;
UNDERWRITING
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(x) a valid demand by any creditor for repayment or payment of any material
indebtedness of any member of the Group or in respect of which any member
of the Group is liable prior to its stated maturity;
(xi) a Governmental Authority or a political body or organization in any Relevant
Jurisdiction commencing any investigation or other action, or announcing an
intention to investigate or take other action, against any Director or members
of senior management;
(xii) any litigation, dispute, legal action or claim of any third party or regulatory,
administrative investigation or action being threatened, instigated or
announced against any member of the Group;
(xiii) any contravention by the Company or any member of the Group, any Director
or the Controlling Shareholders of any applicable Laws and regulations
including the Listing Rules; or
(xiv) any change or development involving a prospective change in, or a
materialization of, any of the risks set out in the section headed “Risk Factors”
of this document;
which, individually or in the aggregate, in the sole and absolute opinion of the Joint
Sponsors and the Overall Coordinators (for themselves and on behalf of the Hong
Kong Underwriters): (1) has or will or may have a material adverse effect; (2) has
or will have or may have a material adverse effect on the success or marketability
of the Global Offering or the level of applications or the distribution of the Offer
Shares under the Hong Kong Public Offering or the level of interest under the
International Offering; (3) makes or will make or is likely to make it inadvisable,
inexpedient, impracticable or incapable for the Hong Kong Public Offering and/or
the International Offering to proceed or to market the Global Offering or the
delivery or distribution of the Offer Shares on the terms and in the manner
contemplated by this document; or (4) has or will or may have the effect of making
any material part of the Hong Kong Underwriting Agreement (including
underwriting) incapable of performance in accordance with its terms or preventing
the processing of applications and/or payments pursuant to the Global Offering or
pursuant to the underwriting thereof; or
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(b) there has come to the notice of the Joint Global Coordinators and the Overall
Coordinators (for themselves and on behalf of the Hong Kong Underwriters) that:
(i) any statement contained in this document and/or any notices, announcements,
advertisements, communications or other documents (including any
announcement, circular, document or other communication pursuant to the
Hong Kong Underwriting Agreement) issued or used by or on behalf of the
Company in connection with the Hong Kong Public Offering and the Global
Offering (including any supplement or amendment thereto), but excluding
information relating to the Underwriters (the “ Offer-Related Documents ”)
was, when it was issued, or has become, untrue, incorrect, inaccurate,
incomplete in any material respects or misleading or deceptive, or that any
estimate, forecast, expression of opinion, intention or expectation contained in
any of such documents is not fair and honest and based on reasonable grounds
or reasonable assumptions;
(ii) any matter has arisen or has been discovered which would, had it arisen or been
discovered immediately before the date of this document, constitute a material
omission from, or misstatement in, any of the Offer-Related Documents;
(iii) there is a material breach of any of the obligations imposed upon the Company
or the Controlling Shareholders under the Hong Kong Underwriting Agreement
or the International Underwriting Agreement or any of the Cornerstone
Investment Agreements, as applicable;
(iv) there is an event, act or omission which gives or is likely to give rise to any
material liability of the Company or the Controlling Shareholders pursuant to
the indemnities given by any of them under the Hong Kong Underwriting
Agreement or the International Underwriting Agreement, as applicable;
(v) there is any material adverse change, or development or likely to be any
prospective material adverse change;
(vi) there is a material breach of, or any event or circumstance rendering untrue,
incorrect, incomplete or misleading, any of the warranties given by the
Company and the Controlling Shareholders in the Hong Kong Underwriting
Agreement or the International Underwriting Agreement, as applicable;
(vii) the approval of the Listing Committee of the listing of, and permission to deal
in, the Shares in issue, the Shares to be issued pursuant to the Global Offering
(including any Shares that may be issued pursuant to the Offer Size Adjustment
Option and the Over-allotment Option) and the Shares which may be issued
pursuant to the Post-IPO Share Award Scheme is refused or not granted, other
than subject to customary conditions, on or before the date of the Listing, or
if granted, the approval is subsequently withdrawn, cancelled, qualified (other
than by customary conditions), revoked or withheld;
UNDERWRITING
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(viii) any person (other than any of the Joint Sponsors) has withdrawn or is subject
to withdrawing its consent to the issue of this document with the inclusion of
its reports, letters and/or legal opinions (as the case may be) and references to
its name included in the form and context in which it respectively appears;
(ix) the Company withdraws this document (and/or any other documents issued or
used in connection with the Global Offering) or the Global Offering;
(x) that a material portion of the orders placed or confirmed in the bookbuilding
process, or of the investment commitments made by any cornerstone investors
under agreements signed with such cornerstone investors, have been
withdrawn, terminated or cancelled, or any of the Cornerstone Investment
Agreement is terminated;
(xi) there is a prohibition by any Governmental Authority applicable to the
Company, any of the Underwriters, and/or any of the foregoing’s respective
affiliates for whatever reason from offering, allotting, issuing or selling any of
the Offer Shares (including any additional Shares to be issued pursuant to the
Offer Size Adjustment Option and the Over-allotment Option) pursuant to the
terms of the Global Offering;
(xii) non-compliance of this document, the CSRC filings (or any other documents
used in connection with the contemplated subscription and sale of the Offer
Shares) or any aspect of the Global Offering with the Listing Rules, the rules
of CSRC or any other applicable Laws;
(xiii) the Chief Executive Officer, Chief Financial Officer, any director or members
of senior management of the Company as listed in this document is vacating
her/his office;
(xiv) any Director or member of senior management of the Company is being
charged with an indictable offence or is prohibited by operation of law or
otherwise disqualified from taking part in the management of a company or
there is the commencement by any Governmental Authority, governmental,
political or regulatory body of any investigation or other action against any
Director in his or her capacity as such or any member of the Group or an
announcement by any Governmental Authority, governmental, political or
regulatory body that it intends to commence any such investigation or take any
such action; or
(xv) there is any order or petition for the winding-up of any member of the Group
or any composition or arrangement made by any member of the Group with its
creditors or a scheme of arrangement entered into by any member of the Group
or any resolution for the winding-up of any member of the Group or the
appointment of a provisional liquidator, receiver or manager over all or part of
the material assets or undertaking of any member of the Group or anything
analogous thereto occurring in respect of any member of the Group.
UNDERWRITING
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Undertakings to the Stock Exchange pursuant to the Listing Rules
(A) Undertakings by the Company
Pursuant to Rule 10.08 of the Listing Rules, the Company has undertaken to the Stock
Exchange that it will not exercise its power to issue any further Shares, or securities
convertible into equity securities of the Company (whether or not of a class already listed) or
enter into any agreement to such an issue within six months from the Listing Date (whether or
not such issue of Shares or securities, or sale or transfer of treasury shares will be completed
within six months from the Listing Date), except (a) pursuant to the Global Offering and the
Over-allotment Option or (b) under any of the circumstances provided under Rule 10.08 of the
Listing Rules.
(B) Undertakings by the Controlling Shareholders
Pursuant to Rule 10.07 of the Listing Rules, the Controlling Shareholders have
undertaken to the Stock Exchange and the Company that he/it will not and will procure that the
relevant registered holder(s) will not:
(i) in the period commencing on the date by reference to which disclosure of his/its
holding of Shares is made in this document and ending on the date which is six
months from the Listing Date, either directly or indirectly, dispose of, nor enter into
any agreement to dispose of or otherwise create any options, rights, interests or
encumbrances in respect of, any of the Shares in respect of which he/it is shown by
this document to be the beneficial owner; and
(ii) in the period of six months commencing on the date on which the period referred to
in paragraph (i) above expires, either directly or indirectly, dispose of, nor enter into
any agreement to dispose of or otherwise create any options, rights, interests or
encumbrances in respect of, any of the Shares referred to in paragraph (i) above if,
immediately following such disposal or upon the exercise or enforcement of such
options, rights, interests or encumbrances, he/it would cease to be a controlling
shareholder of the Company, in each case, save as permitted under the Listing Rules.
Pursuant to Note 3 to Rule 10.07(2) of the Listing Rules, the Controlling Shareholders
have undertaken to the Stock Exchange and the Company that, within the period commencing
on the date by reference to which disclosure of his/its holding of Shares is made in this
document and ending on the date which is 12 months from the Listing Date, he/it will:
(i) when he/it pledges or charges any Shares beneficially owned by him/it in favour of
an authorised institution (as defined in the Banking Ordinance (Chapter 155 of the
Laws of Hong Kong)) pursuant to Note 2 to Rule 10.07(2) of the Listing Rules,
immediately inform the Company in writing of such pledge or charge together with
the number of Shares so pledged or charged; and
UNDERWRITING
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(ii) when he/it receives indications, either verbal or written, from the pledgee or chargee
of any Shares that any of the pledged or charged Shares will be disposed of,
immediately inform the Company of such indications.
(C) Lock-up Undertakings of All Existing Shareholders
Each of our Shareholders as of the date of this document entered into a lock-up
undertaking pursuant to which, for a period ending on, and including, the date which is one
hundred eighty (180) days after the Listing Date (the “ Lock-up Period ”), they would not (i)
offer, pledge, charge, sell, contract or agree to sell, mortgage, charge, pledge, hypothecate,
lend, grant or sell any option, warrant, contract or right to purchase, grant, or purchase any
option, warrant, contract or right to sell, grant or agree to grant any option, right or warrant to
purchase or subscribe for, lend or otherwise transfer or dispose of or create an encumbrance
over any Shares or other securities of the Company or any interest in any of the foregoing (the
“Relevant Shares ”); (ii) enter into any swap or other arrangement that transfers to another, in
whole or in part, any of the economic consequences of ownership of, any Relevant Shares; or
(iii) enter into any transaction with the same economic effect as any transaction described in
(i) or (ii) above, subject to certain exceptions.
Undertakings pursuant to the Hong Kong Underwriting Agreement
(A) Undertakings by the Company
The Company has undertaken to each of the Joint Global Coordinators, the Overall
Coordinators, the Joint Sponsors, the Capital Market Intermediaries and the Hong Kong
Underwriters not to (save for the issue, offer or sale of the Offer Shares by the Company
pursuant to the Global Offering (including pursuant to the exercise of the Offer Size
Adjustment Option and the Over-allotment Option) and the Post-IPO Share Award Scheme),
without the prior written consent of the Joint Global Coordinators and the Overall Coordinators
(on behalf of the Hong Kong Underwriters) and unless in compliance with the requirements of
the Listing Rules, at any time during the period commencing on the date of the Hong Kong
Underwriting Agreement and ending on, and including, the date that is six months after the
Listing Date (the “ First Six-Month Period ”):
(i) offer, allot, issue, sell, accept subscription for, contract to allot, issue or sell,
contract or agree to allot, issue or sell, assign, grant or sell any option, warrant, right
or contract to purchase, purchase any option or contract to sell, grant or agree to
grant any option, right or warrant to purchase or subscribe for, or otherwise transfer
or dispose of or create an encumbrance over, or agree to transfer or dispose of or
create an encumbrance over, either directly or indirectly, conditionally or
unconditionally, or repurchase, any legal or beneficial interest in any Shares or other
equity securities of the Company, or any shares or other equity securities of such
other member of the Group, as applicable, or any interests in any of the foregoing
(including, but not limited to, any securities that are convertible into or
exchangeable or exercisable for or that represent the right to receive, or any warrants
UNDERWRITING
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or other rights to purchase any Shares, or other equity securities of such other
member of the Group, as applicable) or deposit any Shares or other equity securities
of the Company or any shares or other securities of such other member of the Group,
as applicable, with a depositary in connection with the issue of depositary receipts;
or
(ii) enter into any swap or other arrangement that transfers to another, in whole or in
part, any of the economic consequences of subscription or ownership (legal or
beneficial) of any Shares or other equity securities of the Company or any shares,
or other securities of such other member of the Group, as applicable, or any interest
therein (including, without limitation, any securities of which are convertible into or
exchangeable or exercisable for, or represent the right to receive, or any warrants or
other rights to purchase, any Shares or any shares of such other member of the
Group, as applicable); or
(iii) enter into any transaction with the same economic effect as any transaction specified
in paragraphs (i) or (ii) above; or
(iv) offer to or contract to or agree to announce, or publicly disclose that the Company
will or may enter into any intention to effect any transaction specified in paragraphs
(i), (ii) or (iii) above,
in each case, whether any of the transactions specified in paragraphs (i), (ii) or (iii) above
is to be settled by delivery of Shares or other equity securities of the Company, in cash
or otherwise (whether or not the issue of such Shares or other equity securities will be
completed within the First Six-Month Period). For the avoidance of doubt, the
transactions specified in paragraphs (i), (ii) or (iii) above do not include the share
issuances, share transfer and/or capital increase within the members of the Group,
provided that the Company shall take all reasonable steps to ensure that it will not create
a disorderly or false market in the securities of the Company.
In the event that, during the period of six months commencing on the date on which the
First Six-Month Period expires (the “ Second Six-Month Period ”), the Company enters into
any such transactions or offers or agrees or contracts to, or announces, or publicly discloses,
any intention to, enter into any such transactions, the Company will take all reasonable steps
to ensure that it will not create a disorderly or false market in the securities of the Company.
UNDERWRITING
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(B) Undertakings by the Controlling Shareholders
The Controlling Shareholders have undertaken to the Company, the Joint Global
Coordinators, the Overall Coordinators, the Joint Sponsors, the Capital Market Intermediaries
and the Hong Kong Underwriters that, without the prior written consent of the Joint Global
Coordinators and the Overall Coordinators (on behalf of the Hong Kong Underwriters) and
unless in compliance with the requirements of the Listing Rules:
(a) during the First Six-Month Period, he/it will not, and (a) Ascendis Pharma A/S will
procure each of the other Ascendis Entities (as defined in the Hong Kong
Underwriting Agreement) and (b) Vivo Capital IX will procure each of the other
Vivo Funds Entities (as defined in the Hong Kong Underwriting Agreement) will
not:
(i) offer, pledge, charge, sell, contract or agree to sell, mortgage, charge,
hypothecate, lend, grant or sell any option, warrant, contract or right to
purchase, grant, or purchase any option, warrant, contract or right to sell, grant
or agree to grant any option, right or warrant to purchase or subscribe for, lend
or otherwise transfer or dispose of or create an encumbrance over, either
directly or indirectly, conditionally or unconditionally, any Shares or other
equity securities of the Company or any interest in any of the foregoing
(including, but not limited to, any securities that are convertible into or
exchangeable or exercisable for, or that represent the right to receive, or any
warrants or other rights to purchase, any Shares or other equity securities of the
Company) beneficially owned by him/her/it as of the Listing Date (the
“Locked-up Securities ”); or
(ii) enter into any swap or other arrangement that transfers to another, in whole or
in part, any of the economic consequences of ownership of, any Locked-up
Securities; or
(iii) enter into any transaction with the same economic effect as any transaction
described in paragraphs (i) or (ii) above; or
(iv) offer to or contract to or agree to or publicly disclose that he/it will or may
enter into any transaction described in paragraphs (i), (ii) or (iii) above,
whether any such transaction described in (i), (ii) or (iii) above is to be settled by
delivery of such Shares or other equity securities of the Company, in cash or
otherwise (whether or not the settlement or delivery of such Shares or other equity
securities will be completed within the First Six-Month Period), provided however
that intra-group restructurings of the Ascendis Entities, whether by internal share
transfer, mergers or otherwise, shall not constitute a violation of the lock-up
undertaking to the extent Ascendis Pharma A/S remains the ultimate controlling
entity;
UNDERWRITING
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(b) during the Second Six-Month Period, (a) Ascendis Pharma A/S will procure each of
the other Ascendis Entities will not: enter into any transaction described in
paragraph (a)(i), (ii) or (iii) above in respect of any Locked-up Securities or offer to
or agree to or contract to or publicly announce any intention to enter into any such
transaction if, immediately following such transaction or upon the exercise or
enforcement of any option, right, interest or encumbrance pursuant to such
transaction, Ascendis Pharma A/S (together with any other Ascendis Entities) would
cease to be a controlling shareholder (as defined under the Listing Rules) of the
Company; (b) Vivo Capital IX will procure each of the other Vivo Funds Entities,
will not, enter into any transaction described in paragraphs (a)(i), (ii) or (iii) above
in respect of any Locked-up Securities or offer to or agree to or contract to or
publicly announce any intention to enter into any such transaction if, immediately
following such transaction or upon the exercise or enforcement of any option, right,
interest or encumbrance pursuant to such transaction, Vivo Capital IX (together with
any other Vivo Funds Entities) would cease to be a controlling shareholder (as
defined under the Listing Rules) of the Company;
(c) until the expiry of the Second Six-Month Period, in the event that he/it or the
relevant registered holder(s) enters into any such transactions specified in
paragraphs (a)(i), (ii) or (iii) above or offers to or agrees to or contracts to, or
publicly announces an intention to enter into any such transactions, he/it will take
all reasonable steps to ensure that he/it will not create a disorderly or false market
in the securities of the Company; and
(d) at any time after the date of the Hong Kong Underwriting Agreement up to and
including the date falling 12 months after the Listing Date, he/it will:
(i) if and when he/it or the relevant registered holder(s) pledges or charges any
Shares or other securities of the Company beneficially owned by him/it,
immediately inform the Company in writing of such pledge or charge together
with the number of Shares or other securities of the Company so pledged or
charged; and
(ii) if and when he/it or the relevant registered holder(s) receives indications,
either verbal or written, from any pledgee or chargee that any of the pledged
or charged Shares or other securities of the Company will be disposed of,
immediately inform the Company in writing of such indications. The Company
shall, as soon as reasonably practicable upon receiving such information in
writing from the Controlling Shareholders and if required pursuant to the
Listing Rules, notify the Stock Exchange and make a public disclosure in
relation to such information by way of an announcement
UNDERWRITING
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For the avoidance of doubt, the above restrictions shall not prevent the Controlling
Shareholders from using the Shares beneficially owned by it as security (including
a charge or a pledge) in favor of an authorised institution (as defined in the Banking
Ordinance (Chapter 155 of the Laws of Hong Kong)) for a bona fide commercial
loan during the First Six Month Period and the Second Six Month Period, provided
that (i) Controlling Shareholders immediately informs the Company and the Overall
Coordinators of such pledge or charge together with the number of Shares so
pledged or charged, and (ii) when Controlling Shareholders receive indications,
either verbal or written, from the pledgee or chargee of any Shares that any of the
pledged or charged Shares will be disposed of, it immediately informs the Company
and the Overall Coordinators of such indications.
Hong Kong Underwriters’ interests in the Company
Save for their respective obligations under the Hong Kong Underwriting Agreement, as
of the Latest Practicable Date, none of the Hong Kong Underwriters was interested, legally or
beneficially, directly or indirectly, in any Shares or any securities of any member of the Group
or had any right or option (whether legally enforceable or not) to subscribe for or purchase, or
to nominate persons to subscribe for or purchase, any Shares or any securities of any member
of the Group.
Following the completion of the Global Offering, the Hong Kong Underwriters and their
affiliated companies may hold a certain portion of the Shares as a result of fulfilling their
respective obligations under the Hong Kong Underwriting Agreement.
International Offering
International Underwriting Agreement
In connection with the International Offering, the Company expects to enter into the
International Underwriting Agreement with the International Underwriters on the Price
Determination Date. Under the International Underwriting Agreement and subject to the Offer
Size Adjustment Option and the Over-allotment Option, the International Underwriters would,
subject to certain conditions set out therein, agree severally but not jointly to procure
subscribers for, or themselves to subscribe for, their respective applicable proportions of the
International Offer Shares initially being offered pursuant to the International Offering. It is
expected that the International Underwriting Agreement may be terminated on similar grounds
as the Hong Kong Underwriting Agreement. Potential investors should note that in the event
that the International Underwriting Agreement is not entered into, the Global Offering will not
proceed. See “Structure of the Global Offering – The International Offering.”
UNDERWRITING
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Over-allotment Option
The Company is expected to grant to the International Underwriters the Over-allotment
Option, exercisable by the Joint Global Coordinators and the Overall Coordinators on behalf
of the International Underwriters at any time from the Listing Date until 30 days after the last
day for lodging applications under the Hong Kong Public Offering, pursuant to which the
Company may be required to issue up to an additional 1,485,000 Shares (representing not more
than 15% of the Offer Shares initially available under the Global Offering assuming the Offer
Size Adjustment Option is not exercised at all) or up to an additional 1,707,700 Shares
(representing not more than 15% of the Offer Shares being offered under the Global Offering
assuming the Offer Size Adjustment Option is exercised in full) at the Offer Price to cover
over-allocations in the International Offering, if any. See “Structure of the Global Offering –
Over-Allotment Option.”
Commissions and Expenses
The Underwriters and the Capital Market Intermediaries will receive an underwriting
commission of 3% of the aggregate Offer Price of all the Offer Shares (including any Offer
Shares to be issued pursuant to the exercise of the Offer Size Adjustment Option or the
Over-allotment Option) (the “ Fixed Fees ”), out of which they will pay any sub-underwriting
commissions and other fees.
The Company may pay to each of the Joint Global Coordinators, the Overall
Coordinators, the Joint Bookrunners and the Capital Market Intermediaries a discretionary
incentive fee of up to but not exceeding 1% of the Offer Price for all the Offer Share (including
any Offer Shares to be issued pursuant to the exercise of the Offer Size Adjustment Option and
the Over-allotment Option) (the “ Discretionary Fees ”).
The amount and respective entitlement among the Underwriters and the Capital Market
Intermediaries of which is expected to be determined before the Listing Date in compliance
with the Listing Rules. Assuming the Discretionary Fees are paid in full, the ratio of the Fixed
Fees and the Discretionary Fees paid or payable to all Underwriters and all Capital Market
Intermediaries is 59:41.
For any unsubscribed Hong Kong Offer Shares reallocated to the International Offering,
the underwriting commission will not be paid to the Hong Kong Underwriters but will instead
be paid, at the rate applicable to the International Offering, to the relevant International
Underwriters.
Assuming an Offer Price of HK$71.86 per Offer Share (which is the mid-point of the
Offer Price range), the aggregate underwriting commissions and fees together with the Stock
Exchange listing fees, SFC transaction levy, Stock Exchange trading fee and AFRC transaction
levy, legal and other professional fees and printing and all other expenses relating to the Global
Offering (collectively, the “ Commissions and Fees ”) are estimated to be approximately
HK$108.1 million (assuming the Offer Size Adjustment Option and the Over-allotment Option
are not exercised and no Shares are issued under the Post-IPO Share Award Scheme).
UNDERWRITING
– 485 –


--- page 496 ---
Indemnity
The Company has agreed to indemnify the Joint Sponsors, the Joint Global Coordinators,
the Overall Coordinators, the Joint Bookrunners, the Joint Lead Managers, the Capital Market
Intermediaries and the Hong Kong Underwriters for certain losses which they may suffer or
incur, including losses arising from their performance of their obligations under the Hong Kong
Underwriting Agreement and any breach by the Company and the Controlling Shareholders of
the Hong Kong Underwriting Agreement.
ACTIVITIES BY SYNDICATE MEMBERS
The Underwriters of the Hong Kong Public Offering and the International Offering
(together, the “ Syndicate Members ”) and their affiliates may each individually undertake a
variety of activities (as further described below) which do not form part of the underwriting or
stabilizing process.
The Syndicate Members and their affiliates are diversified financial institutions with
relationships in countries around the world. These entities engage in a wide range of
commercial and investment banking, brokerage, funds management, trading, hedging,
investing and other activities for their own account and for the account of others. In the
ordinary course of their various business activities, the Syndicate Members and their respective
affiliates may purchase, sell or hold a broad array of investments and actively trade securities,
derivatives, loans, commodities, currencies, credit default swaps and other financial
instruments for their own account and for the accounts of their customers. Such investment and
trading activities may involve or relate to assets, securities and/or instruments of the Company
and/or persons and entities with relationships with the Company and may also include swaps
and other financial instruments entered into for hedging purposes in connection with the
Group’s loans and other debt.
In relation to the Shares, the activities of the Syndicate Members and their affiliates could
include acting as agent for buyers and sellers of the Shares, entering into transactions with
those buyers and sellers in a principal capacity, including as a lender to initial purchasers of
the Shares (which financing may be secured by the Shares) in the Global Offering, proprietary
trading in the Shares, and entering into over the counter or listed derivative transactions or
listed or unlisted securities transactions (including issuing securities such as derivative
warrants listed on a stock exchange) which have as their underlying assets, assets including the
Shares. Such transactions may be carried out as bilateral agreements or trades with selected
counterparties. Those activities may require hedging activity by those entities involving,
directly or indirectly, the buying and selling of the Shares, which may have a negative impact
on the trading price of the Shares. All such activities could occur in Hong Kong and elsewhere
in the world and may result in the Syndicate Members and their affiliates holding long and/or
short positions in the Shares, in baskets of securities or indices including the Shares, in units
of funds that may purchase the Shares, or in derivatives related to any of the foregoing.
UNDERWRITING
– 486 –


--- page 497 ---
In relation to issues by Syndicate Members or their affiliates of any listed securities
having the Shares as their underlying securities, whether on the Stock Exchange or on any
other stock exchange, the rules of the stock exchange may require the issuer of those securities
(or one of its affiliates or agents) to act as a market maker or liquidity provider in the security,
and this will also result in hedging activity in the Shares in most cases.
All such activities may occur both during and after the end of the stabilizing period
described in the section headed “Structure of the Global Offering” in this prospectus. Such
activities may affect the market price or value of the Shares, the liquidity or trading volume
in the Shares and the volatility of the price of the Shares, and the extent to which this occurs
from day to day cannot be estimated.
It should be noted that when engaging in any of these activities, the Syndicate Members
will be subject to certain restrictions, including the following:
(a) the Syndicate Members (other than the Stabilization Manager or any person acting
for it) must not, in connection with the distribution of the Offer Shares, effect any
transactions (including issuing or entering into any option or other derivative
transactions relating to the Offer Shares), whether in the open market or otherwise,
with a view to stabilizing or maintaining the market price of any of the Offer Shares
at levels other than those which might otherwise prevail in the open market; and
(b) the Syndicate Members must comply with all applicable laws and regulations,
including the market misconduct provisions of the SFO, including the provisions
prohibiting insider dealing, false trading, price rigging and stock market
manipulation.
Certain of the Syndicate Members or their respective affiliates have provided from time
to time, and expect to provide in the future, investment banking and other services to the
Company and each of its affiliates for which such Syndicate Members or their respective
affiliates have received or will receive customary fees and commissions.
In addition, the Syndicate Members or their respective affiliates may provide financing to
investors to finance their subscriptions of Offer Shares in the Global Offering.
UNDERWRITING
– 487 –


--- page 498 ---
THE GLOBAL OFFERING
This prospectus is published in connection with the Hong Kong Public Offering as part
of the Global Offering. Morgan Stanley Asia Limited and Jefferies Hong Kong Limited are the
Overall Coordinators of the Global Offering.
The listing of the Shares on the Stock Exchange is sponsored by the Joint Sponsors. The
Joint Sponsors have made an application on behalf of the Company to the Stock Exchange for
the listing of, and permission to deal in, the Shares in issue and to be issued as mentioned in
this prospectus.
9,900,000 Offer Shares will initially be made available under the Global Offering
comprising:
(a) the Hong Kong Public Offering of initially 990,000 Shares (subject to reallocation
and the Offer Size Adjustment Option) in Hong Kong as described in “– The Hong
Kong Public Offering” in this section below; and
(b) the International Offering of initially 8,910,000 Shares (subject to reallocation, the
Offer Size Adjustment Option and the Over-allotment Option) (i) in the United
States solely to QIBs in reliance on Rule 144A or another exemption from, or in a
transaction not subject to, the registration requirements of the U.S. Securities Act
and (ii) outside the United States (including to professional and institutional
investors within Hong Kong) in offshore transactions in reliance on Regulation S, as
described in the sub-section headed “– The International Offering” in this section
below.
Investors may either:
(i) apply for Hong Kong Offer Shares under the Hong Kong Public Offering; or
(ii) apply for or indicate an interest for International Offer Shares under the
International Offering, but may not do both.
The Offer Shares will represent approximately 8.80% of the total Shares in issue
immediately following the completion of the Global Offering, assuming the Offer Size
Adjustment Option and the Over-allotment Option are not exercised and no Shares are issued
under the Post-IPO Share Award Scheme. If the Offer Size Adjustment Option and the
Over-allotment Option are exercised in full but no Shares are issued under the Post-IPO Share
Award Scheme, the Offer Shares (including Shares issued pursuant to the full exercise of the
Offer Size Adjustment Option and the Over-allotment Option) will represent approximately
11.32% of the total Shares in issue immediately following the completion of the Global
Offering and the issue of Offer Shares pursuant to the Offer Size Adjustment Option and the
Over-allotment Option.
References in this prospectus to applications, application monies or the procedure for
applications relate solely to the Hong Kong Public Offering.
STRUCTURE OF THE GLOBAL OFFERING
– 488 –


--- page 499 ---
THE HONG KONG PUBLIC OFFERING
Number of Offer Shares initially offered
The Company is initially offering 990,000 Shares for subscription by the public in Hong
Kong at the Offer Price, representing 10.0% of the total number of Offer Shares initially
available under the Global Offering. The number of Offer Shares initially offered under the
Hong Kong Public Offering, subject to any reallocation of Offer Shares between the
International Offering and the Hong Kong Public Offering, will represent approximately 0.88%
of the total Shares in issue immediately following the completion of the Global Offering
(assuming the Offer Size Adjustment Option and the Over-allotment Option are not exercised
and no Shares are issued under the Post-IPO Share Award Scheme).
The Hong Kong Public Offering is open to members of the public in Hong Kong as well
as to institutional and professional investors in Hong Kong. Professional investors generally
include brokers, dealers, companies (including fund managers) whose ordinary business
involves dealing in shares and other securities and corporate entities that regularly invest in
shares and other securities.
Completion of the Hong Kong Public Offering is subject to the conditions set out in
“– Conditions of the Global Offering” in this section.
Allocation
Allocation of Offer Shares to applicants under the Hong Kong Public Offering will be
based solely on the level of valid applications received under the Hong Kong Public Offering.
The basis of allocation may vary, depending on the number of Hong Kong Offer Shares validly
applied for by applicants. Such allocation could, where appropriate, consist of balloting, which
could mean that some applicants may receive a higher allocation than others who have applied
for the same number of Hong Kong Offer Shares, and those applicants who are not successful
in the ballot may not receive any Hong Kong Offer Shares.
For allocation purposes only, the total number of Hong Kong Offer Shares available under
the Hong Kong Public Offering (after taking into account any reallocation referred to below)
will be divided equally (to the nearest board lot) into two pools: pool A and pool B (with any
odd lot being allocated to pool A). The Hong Kong Offer Shares in pool A will be allocated
on an equitable basis to applicants who have applied for Hong Kong Offer Shares with an
aggregate price of HK$5 million (excluding the brokerage, SFC transaction levy, Stock
Exchange trading fee and AFRC transaction levy payable) or less. The Hong Kong Offer Shares
in pool B will be allocated on an equitable basis to applicants who have applied for Hong Kong
Offer Shares with an aggregate price of more than HK$5 million (excluding the brokerage, SFC
transaction levy, Stock Exchange trading fee and AFRC transaction levy payable) and up to the
total value in pool B.
STRUCTURE OF THE GLOBAL OFFERING
– 489 –


--- page 500 ---
Investors should be aware that applications in pool A and applications in pool B may
receive different allocation ratios. If any Hong Kong Offer Shares in one (but not both) of the
pools are unsubscribed, such unsubscribed Hong Kong Offer Shares will be transferred to the
other pool to satisfy demand in that other pool and be allocated accordingly. For the purpose
of the immediately preceding paragraph only, the “price” for Hong Kong Offer Shares means
the price payable on application therefor (without regard to the Offer Price as finally
determined). Applicants can only receive an allocation of Hong Kong Offer Shares from either
pool A or pool B and not from both pools. Multiple or suspected multiple applications under
the Hong Kong Public Offering and any application for more than 495,000 Hong Kong Offer
Shares (being 50% of the 990,000 Offer Shares initially available under the Hong Kong Public
Offering) is liable to be rejected.
Reallocation and Clawback
The allocation of the Offer Shares between the Hong Kong Public Offering and the
International Offering is subject to reallocation. Paragraph 4.2 of Practice Note 18 of the
Listing Rules requires a clawback mechanism to be put in place which would have the effect
of increasing the number of Offer Shares under the Hong Kong Public Offering to a certain
percentage of the total number of Offer Shares offered under the Global Offering if certain
prescribed total demand levels are reached.
If the number of Offer Shares validly applied for under the Hong Kong Public Offering
represents (a) 15 times or more but less than 50 times, (b) 50 times or more but less than 100
times and (c) 100 times or more of the total number of Offer Shares initially available under
the Hong Kong Public Offering, then Offer Shares will be reallocated to the Hong Kong Public
Offering from the International Offering. As a result of such reallocation, the total number of
Offer Shares available under the Hong Kong Public Offering will be increased to 2,970,000
Offer Shares (in the case of (a)), 3,960,000 Offer Shares (in the case of (b)) and 4,950,000
Offer Shares (in the case of (c)), representing 30%, 40% and 50% of the total number of Offer
Shares initially available under the Global Offering, respectively (before any exercise of the
Offer Size Adjustment Option and the Over-allotment Option) (the “ PN18 Clawback ”). In
each case, the additional Offer Shares reallocated to the Hong Kong Public Offering will be
allocated between pool A and pool B and the number of Offer Shares allocated to the
International Offering will be correspondingly reduced in such manner as the Overall
Coordinators deem appropriate.
If the Hong Kong Public Offering is not fully subscribed for, the Overall Coordinators
have the authority to reallocate all or any unsubscribed Hong Kong Offer Shares to the
International Offering, in such proportions as the Overall Coordinators deem appropriate. In
addition, the Overall Coordinators may in their sole discretion reallocate Offer Shares from the
International Offering to the Hong Kong Public Offering to satisfy valid applications under the
Hong Kong Public Offering. In particular, if (i) the International Offering is not fully
subscribed and the Hong Kong Public Offering is fully subscribed or oversubscribed; or (ii) the
International Offering is fully subscribed or oversubscribed and the Hong Kong Public
Offering is fully subscribed or oversubscribed with the number of Offer Shares validly applied
STRUCTURE OF THE GLOBAL OFFERING
– 490 –


--- page 501 ---
for in the Hong Kong Public Offering representing less than 15 times of the number of Shares
initially available for subscription under the Hong Kong Public Offering, the Overall
Coordinators have the authority to reallocate International Offer Shares originally included in
the International Offering to the Hong Kong Public Offering in such number as they deem
appropriate, provided that in accordance with Chapter 4.14 of the Guide for New Listing
Applicants by the Stock Exchange, (i) the number of International Offer Shares reallocated to
the Hong Kong Public Offering should not exceed 990,000 Shares, representing approximately
10% of the Offer Shares initially available under the Global Offering, increasing the total
number of Offer Shares available under the Hong Kong Public Offering to 1,980,000 Shares,
representing approximately twice the number of the Offer Shares initially available under the
Hong Kong Public Offering; and (ii) the final Offer Price should be fixed at the bottom end of
the indicative Offer Price range (i.e. HK$68.44 per Offer Share) stated in this prospectus.
In each case, the additional Offer Shares reallocated to the Hong Kong Public Offering
will be allocated between pool A and pool B and the number of Offer Shares allocated to the
International Offering will be correspondingly reduced in such manner as the Overall
Coordinators deem appropriate.
Details of any reallocation of Offer Shares between the Hong Kong Public Offering and
the International Offering will be disclosed in the results announcement of the Global Offering,
which is expected to be published on Thursday, March 20, 2025.
Applications
Each applicant under the Hong Kong Public Offering will be required to give an
undertaking and confirmation in the application submitted by him that he and any person(s) for
whose benefit he is making the application has not applied for or taken up, or indicated an
interest for, and will not apply for or take up, or indicate an interest for, any International Offer
Shares under the International Offering. Such applicant’s application is liable to be rejected if
such undertaking and/or confirmation is/are breached and/or untrue (as the case may be) or if
he has been or will be placed or allocated International Offer Shares under the International
Offering.
Applicants under the Hong Kong Public Offering are required to pay, on application, the
maximum Offer Price of HK$75.28 per Offer Share in addition to the brokerage, the SFC
transaction levy, the Stock Exchange trading fee and AFRC transaction levy payable on each
Offer Share, amounting to a total of HK$7,603.92 for one board lot of 100 Shares. If the Offer
Price, as finally determined in the manner described in “– Pricing and Allocation” in this
section below, is less than the maximum Offer Price of HK$75.28 per Offer Share, appropriate
refund payments (including the brokerage, SFC transaction levy, Stock Exchange trading fee
and AFRC transaction levy attributable to the surplus application monies) will be made to
successful applicants, without interest. Further details are set out in the section headed “How
to Apply for Hong Kong Offer Shares” in this prospectus.
STRUCTURE OF THE GLOBAL OFFERING
– 491 –


--- page 502 ---
THE INTERNATIONAL OFFERING
Number of Offer Shares initially offered
The International Offering will consist of an offering of initially 8,910,000 Shares,
representing 90.0% of the total number of Offer Shares initially available under the Global
Offering (subject to reallocation, the Offer Size Adjustment Option and the Over-allotment
Option). The number of Offer Shares initially offered under the International Offering, subject
to any reallocation of Offer Shares between the International Offering and the Hong Kong
Public Offering, will represent approximately 7.92% of the total Shares in issue immediately
following the completion of the Global Offering (assuming the Offer Size Adjustment Option
and the Over-allotment Option are not exercised and no Shares are issued under the Post-IPO
Share Award Scheme).
Allocation
The International Offering will include selective marketing of Offer Shares to QIBs in the
United States as well as institutional and professional investors and other investors anticipated
to have a sizeable demand for such Offer Shares in Hong Kong and other jurisdictions outside
the United States in reliance on Regulation S. Professional investors generally include brokers,
dealers, companies (including fund managers) whose ordinary business involves dealing in
shares and other securities and corporate entities that regularly invest in shares and other
securities. Allocation of Offer Shares pursuant to the International Offering will be effected in
accordance with the “book-building” process described in “– Pricing and Allocation” in this
section and based on a number of factors, including the level and timing of demand, the total
size of the relevant investor’s invested assets or equity assets in the relevant sector and whether
or not it is expected that the relevant investor is likely to buy further Shares and/or hold or sell
its Shares after the Listing. Such allocation is intended to result in a distribution of the Shares
on a basis which would lead to the establishment of a solid professional and institutional
shareholder base to the benefit of the Group and the Shareholders as a whole.
The Overall Coordinators (on behalf of the Underwriters) may require any investor who
has been offered Offer Shares under the International Offering and who has made an
application under the Hong Kong Public Offering to provide sufficient information to the
Overall Coordinators so as to allow them to identify the relevant applications under the Hong
Kong Public Offering and to ensure that they are excluded from any allocation of Offer Shares
under the Hong Kong Public Offering.
Reallocation
The total number of Offer Shares to be issued or sold pursuant to the International
Offering may change as a result of the clawback arrangement described in “– The Hong Kong
Public Offering – Reallocation and Clawback” in this section above, the exercise of the Offer
Size Adjustment Option and/or the Over-allotment Option in whole or in part and/or any
reallocation of unsubscribed Offer Shares originally included in the Hong Kong Public
Offering.
STRUCTURE OF THE GLOBAL OFFERING
– 492 –


--- page 503 ---
OFFER SIZE ADJUSTMENT OPTION
In connection with the Global Offering, the Company has the Offer Size Adjustment
Option under the Hong Kong Underwriting Agreement. The Offer Size Adjustment Option
provides flexibility to increase the number of Offer Shares available for purchase under the
Global Offering to cover additional market demand, if any. The Offer Size Adjustment Option
may be exercised by the Company after consultation with the Overall Coordinators and the
Joint Sponsors on or before the Price Determination Date and will expire upon execution of the
International Underwriting Agreement and the Price Determination Agreement.
Under the Offer Size Adjustment Option, the Company may issue any number of Shares
up to an aggregate of 1,485,000 additional Offer Shares at the Offer Price. These Offer Size
Adjustment Option Shares, if any, will be allocated in such manner as closely as practicable
to maintain the proportionality between the Hong Kong Public Offering and the International
Offering following the application of the clawback arrangement described in “– Reallocation”
in this section and the Overall Coordinators shall allocate additional new Shares to be offered
by the Company pursuant to the International Offering to the Hong Kong Public Offering in
order to maintain such proportionality and the relevant number of Offer Size Adjustment
Option Shares shall be allocated to the International Offering to maintain such proportionality.
If the Offer Size Adjustment Option is exercised in full, the Offer Size Adjustment Option
Shares to be issued pursuant thereto will represent approximately 1.30% of our issued share
capital immediately following the completion of the Global Offering (assuming the Over-
allotment Option is not exercised) and the exercise of the Offer Size Adjustment Option.
The dilution effect of the Offer Size Adjustment Option (assuming the Over-allotment
Option is not exercised) is set out below:
Number of Shares issued
under the Global Offering
before the exercise of the
Offer Size Adjustment
Option (“Original
Subscribers”)
Approximate percentage
of total issued share
capital held by the
Original Subscribers
before the exercise of
the Offer Size
Adjustment Option
Number of Shares issued
under the Global Offering
after the exercise of
the Offer Size
Adjustment Option
Approximate percentage
of total issued share
capital held by the
Original Subscribers
after the exercise of
the Offer Size
Adjustment Option
9,900,000 8.80% 11,385,000 8.96%
The Offer Size Adjustment Option will not be used for price stabilization purposes and
will not be subject to the provisions of the Securities and Futures (Price Stabilization) Rules
(Chapter 571W of the Laws of Hong Kong). The Offer Size Adjustment Option will be in
addition to the Over-allotment Option.
STRUCTURE OF THE GLOBAL OFFERING
– 493 –


--- page 504 ---
The Company will disclose in its allotment results announcement if and to what extent the
Offer Size Adjustment Option has been exercised, or will confirm that if the Offer Size
Adjustment Option has not been exercised by the Price Determination Date, it will lapse and
cannot be exercised at any future date.
OVER-ALLOTMENT OPTION
In connection with the Global Offering, the Company is expected to grant the
Over-allotment Option to the International Underwriters, exercisable by the Overall
Coordinators (on behalf of the International Underwriters).
Pursuant to the Over-allotment Option, the International Underwriters will have the right,
exercisable by the Overall Coordinators (on behalf of the International Underwriters) at any
time from the Listing Date until 30 days after the last day for lodging applications under the
Hong Kong Public Offering, to require the Company to issue up to an additional 1,485,000
Shares (representing not more than 15% of the Offer Shares initially available under the Global
Offering assuming the Offer Size Adjustment Option is not exercised at all) or up to an
additional 1,707,700 Shares (representing not more than 15% of the Offer Shares being offered
under the Global Offering assuming the Offer Size Adjustment Option is exercised in full) at
the Offer Price under the International Offering to, among other things, cover over-allocations
in the International Offering, if any.
If the Offer Size Adjustment Option is not exercised and the Over-allotment Option is
exercised in full, the additional Offer Shares to be issued pursuant thereto will represent
approximately 1.30% of the total Shares in issue immediately following the completion of the
Global Offering and the issue of Offer Shares pursuant to the Over-allotment Option, and
assuming no Shares are issued under the Post-IPO Share Award Scheme. If the Offer Size
Adjustment Option and the Over-allotment Option are exercised in full, the additional Offer
Shares to be issued pursuant to the Over-allotment Option will represent approximately 2.76%
of the enlarged issued share capital of the Company immediately following the completion of
the Global Offering (assuming no Shares are issued under the Post-IPO Share Award Scheme).
If the Over-allotment Option is exercised, an announcement will be made.
STABILIZATION
Stabilization is a practice used by underwriters in some markets to facilitate the
distribution of securities. To stabilize, the underwriters may bid for, or purchase, the securities
in the secondary market during a specified period of time, to retard and, if possible, prevent
a decline in the initial public market price of the securities below the offer price. Such
transactions may be effected in all jurisdictions where it is permissible to do so, in each case
in compliance with all applicable laws and regulatory requirements, including those of Hong
Kong. In Hong Kong, the price at which stabilization is effected is not permitted to exceed the
offer price.
STRUCTURE OF THE GLOBAL OFFERING
– 494 –


--- page 505 ---
In connection with the Global Offering, the Stabilization Manager (or any person acting
for it), on behalf of the Underwriters, may over-allocate or effect transactions with a view to
stabilizing or supporting the market price of the Shares at a level higher than that which might
otherwise prevail for a limited period after the Listing Date. However, there is no obligation
on the Stabilization Manager (or any person acting for it) to conduct any such stabilizing
action. Such stabilizing action, if taken, (a) will be conducted at the absolute discretion of the
Stabilization Manager (or any person acting for it) and in what the Stabilization Manager
reasonably regards as the best interest of the Company, (b) may be discontinued at any time
and (c) is required to be brought to an end within 30 days of the last day for lodging
applications under the Hong Kong Public Offering. The number of Shares that may be
over-allocated will not exceed the number of Shares that may be sold under the Over-allotment
Option, being 1,485,000 Shares (representing not more than 15% of the Offer Shares initially
available under the Global Offering assuming the Offer Size Adjustment Option is not
exercised at all) or 1,707,700 Shares (representing not more than 15% of the Offer Shares being
offered under the Global Offering assuming the Offer Size Adjustment Option is exercised in
full).
Stabilization action will be entered into in accordance with the laws, rules and regulations
in place in Hong Kong. Stabilization action permitted in Hong Kong pursuant to the Securities
and Futures (Price Stabilizing) Rules of the SFO includes (a) over-allocating for the purpose
of preventing or minimizing any reduction in the market price of the Shares, (b) selling or
agreeing to sell the Shares so as to establish a short position in them for the purpose of
preventing or minimizing any reduction in the market price of the Shares, (c) purchasing, or
agreeing to purchase, the Shares pursuant to the Over-allotment Option in order to close out
any position established under paragraph (a) or (b) above, (d) purchasing, or agreeing to
purchase, any of the Shares for the sole purpose of preventing or minimizing any reduction in
the market price of the Shares, (e) selling or agreeing to sell any Shares in order to liquidate
any position established as a result of those purchases, and (f) offering or attempting to do
anything as described in paragraph (b), (c), (d) or (e) above.
Specifically, prospective applicants for and investors in the Offer Shares should note that:
(a) the Stabilization Manager (or any person acting for it) may, in connection with the
stabilizing action, maintain a long position in the Shares;
(b) there is no certainty as to the extent to which and the time or period for which the
Stabilization Manager (or any person acting for it) will maintain such a long
position;
(c) liquidation of any such long position by the Stabilization Manager (or any person
acting for it) and selling in the open market may have an adverse impact on the
market price of the Shares;
STRUCTURE OF THE GLOBAL OFFERING
– 495 –


--- page 506 ---
(d) no stabilizing action can be taken to support the price of the Shares for longer than
the stabilization period, which will begin on the Listing Date, and is expected to
expire on the 30th day after the last day for lodging applications under the Hong
Kong Public Offering. After this date, when no further stabilizing action may be
taken, demand for the Shares, and therefore the price of the Shares, could fall;
(e) the price of the Shares cannot be assured to stay at or above the Offer Price either
during or after the stabilization period by the taking of any stabilizing action; and
(f) stabilizing bids or transactions effected in the course of the stabilizing action may
be made at any price at or below the Offer Price and can, therefore, be done at a
price below the price paid by applicants for, or investors in, the Offer Shares.
In order to effect stabilization actions, the Stabilization Manager will arrange cover of up
to an additional 1,485,000 Shares (representing not more than 15% of the Offer Shares initially
available under the Global Offering assuming the Offer Size Adjustment Option is not
exercised at all) or up to an additional 1,707,700 Shares (representing not more than 15% of
the Offer Shares being offered under the Global Offering assuming the Offer Size Adjustment
Option is exercised in full), through borrowing of Shares from the Shareholders and/or delayed
delivery arrangements with investors who have been allocated Offer Shares in the International
Offering. The delayed delivery arrangements (if specifically agreed by an investor) relate only
to the delay in the delivery of the Offer Shares to such investor and the Offer Price for the Offer
Shares allocated to such investor will be paid on the Listing Date.
The Company will ensure or procure that an announcement in compliance with the
Securities and Futures (Price Stabilizing) Rules of the SFO will be made within seven days of
the expiration of the stabilization period.
OFFER SIZE
The allocation and the total number of Offer Shares under the Global Offering will be
determined in the following manner:
The allocation of Offer Shares between the International Offering and the Hong Kong
Public Offering will be subject to a reallocation adjustment depending on the number of Offer
Shares validly applied for under the Hong Kong Public Offering. See “– The Hong Kong Public
Offering – Reallocation” above for details.
If the Offer Size Adjustment Option is exercised in full, the additional Offer Shares made
available as a result, representing approximately 15% of the number of Offer Shares initially
being offered under the Global Offering, will be allocated so as to maintain the proportionality
between the Hong Kong Public Offering and the International Offering on a post-clawback
basis. The Offer Size Adjustment Option will lapse if it is not exercised by the Price
Determination Date. See “– The International Offering – Offer Size Adjustment Option” above
for details.
STRUCTURE OF THE GLOBAL OFFERING
– 496 –


--- page 507 ---
The number of Offer Shares to be made available under the International Offering may
be further increased if the Over-allotment Option is exercised. The maximum number of
additional International Offer Shares to be offered pursuant to the exercise of the Over-
allotment Option will represent approximately 15% of the number of Offer Shares being
offered under the Global Offering (including the Shares offered pursuant to the exercise of the
Offer Size Adjustment Option, if any). See “– The International Offering – Over-allotment
Option” above for details.
Over-allocation
Following any over-allocation of Shares in connection with the Global Offering, the
Stabilization Manager (or any person acting for it) may cover such over-allocations by
exercising the Over-allotment Option in full or in part, by using Shares purchased by the
Stabilization Manager (or any person acting for it) in the secondary market at prices that do not
exceed the Offer Price or through stock borrowing arrangements or a combination of these
means.
PRICING AND ALLOCATION
Pricing for the Offer Shares for the purpose of the various offerings under the Global
Offering will be fixed on the Price Determination Date, which is expected to be on or before
Wednesday, March 19, 2025 and, in any event, not later than 12:00 noon on Wednesday, March
19, 2025, by agreement between the Overall Coordinators (on behalf of the Underwriters) and
the Company, and the number of Offer Shares to be allocated under the various offerings will
be determined shortly thereafter.
The Offer Price will not be more than HK$75.28 per Offer Share and is expected to be
not less than HK$68.44 per Offer Share, unless otherwise announced, as further explained
below. Applicants under the Hong Kong Public Offering must pay, on application, the
Maximum Offer Price of HK$75.28 per Offer Share plus brokerage of 1%, SFC transaction
levy of 0.0027%, Stock Exchange trading fee of 0.00565% and AFRC transaction levy of
0.00015%, amounting to a total of HK$7,603.92 for one board lot of 100 Shares. Prospective
investors should be aware that the Offer Price to be determined on the Price
Determination Date may be, but is not expected to be, lower than the minimum Offer
Price stated in this prospectus.
The International Underwriters will be soliciting from prospective investors indications
of interest in acquiring Offer Shares in the International Offering. Prospective professional and
institutional investors will be required to specify the number of Offer Shares under the
International Offering they would be prepared to acquire either at different prices or at a
particular price. This process, known as “book-building,” is expected to continue up to, and to
cease on or about, the last day for lodging applications under the Hong Kong Public Offering.
STRUCTURE OF THE GLOBAL OFFERING
– 497 –


--- page 508 ---
The Overall Coordinators (on behalf of the Underwriters) may, where they deem
appropriate, based on the level of interest expressed by prospective investors during the
book-building process in respect of the International Offering, and with the consent of the
Company, reduce the number of Offer Shares offered and/or the Offer Price Range below that
stated in this prospectus at any time on or prior to the morning of the last day for lodging
applications under the Hong Kong Public Offering. In such a case, the Company will, as soon
as practicable following the decision to make such reduction, and in any event not later than
the morning of the last day for lodging applications under the Hong Kong Public Offering,
cause to be published on the websites of the Company and the Stock Exchange at
www.visenpharma.com and www.hkexnews.hk , respectively, notices of the reduction and the
cancellation of the Global Offering and relaunch of the offer at the revised number of Offer
Shares and/or the revised indicative Offer Price range.
The Company will also, as soon as practicable following the decision to make such
change, issue a supplemental or new prospectus updating investors of the change in the number
of Offer Shares and/or the indicative Offer Price range, and giving investors at least three
business days to consider the new information. The supplemental or new prospectus should
include at least the following: updated (i) Offer Price range and market capitalization; (ii)
listing timetable and underwriting obligations; (iii) price/earnings multiple, unaudited pro
forma and adjusted net tangible assets; and (iv) use of proceeds and confirmation of the
working capital adequacy based on the revised estimated proceeds.
Before submitting applications for the Hong Kong Offer Shares, applicants should have
regard to the possibility that any announcement of a reduction in the number of Offer Shares
and/or the Offer Price range may not be made until the last day for lodging applications under
the Hong Kong Public Offering. Such notice will also include confirmation or revision, as
appropriate, of the working capital statement and the Global Offering statistics as currently set
out in this prospectus, and any other financial information which may change as a result of any
such reduction. In the absence of any such notice so published, the number of Offer Shares will
not be reduced and/or the Offer Price, if agreed upon by the Overall Coordinators (on behalf
of the Underwriters) and the Company, will under no circumstances be set outside the Offer
Price Range as stated in this prospectus.
If there is any change to the offer size due to change in the number of Offer Shares offered
in the Global Offering (other than pursuant to the reallocation mechanism as disclosed in this
prospectus), or change to the Offer Price falling outside the indicative Offer Price range as
stated in this prospectus, or if the Company becomes aware that there has been a significant
change affecting any matter contained in this Prospectus or a significant new matter has arisen,
the inclusion of information in respect of which would have been required to be in this
prospectus if it had arisen before this prospectus was issued, after the issue of this prospectus
and before the commencement of dealings in our Shares as prescribed under Rule 11.13 of the
Listing Rules, we are required to cancel the Global Offering and relaunch the offer with a
supplemental prospectus or a new prospectus in FINI.
STRUCTURE OF THE GLOBAL OFFERING
– 498 –


--- page 509 ---
The final Offer Price, the level of indications of interest in the International Offering, the
level of applications in the Hong Kong Public Offering, the basis of allocations of the Hong
Kong Offer Shares and the results of allocations in the Hong Kong Public Offering are
expected to be made available through a variety of channels in the manner described in the
section headed “How to Apply for Hong Kong Offer Shares – B. Publication of Results” in this
prospectus.
STOCK BORROWING AGREEMENT
In order to facilitate the settlement of over-allocations, if any, in connection with the
Global Offering, the Stabilization Manager, its affiliates, or any person acting for it may choose
to borrow up to an additional 1,485,000 Shares (representing not more than 15% of the Offer
Shares initially available under the Global Offering assuming the Offer Size Adjustment
Option is not exercised at all) or up to an additional 1,707,700 Shares (representing not more
than 15% of the Offer Shares being offered under the Global Offering assuming the Offer Size
Adjustment Option is exercised in full) from VPP LU Limited pursuant to a Stock Borrowing
Agreement, or acquire Shares from other sources, including the exercising of the Over-
allotment Option. The Stock Borrowing Agreement is expected to be entered into between the
Stabilization Manager and VPP LU Limited on or about the Price Determination Date.
The same number of Shares as that borrowed must be returned to VPP LU Limited or its
respective nominees on or before the third business day following the earlier of (i) the last day
on which the Over-allotment Option may be exercised, and (ii) the day on which the
Over-allotment Option is exercised in full, or such earlier time as may be agreed in writing
between the parties.
If the Stock Borrowing Agreement with VPP LU Limited is entered into, the borrowing
of Shares will only be effected by the Stabilizing Manager (on its own or through its affiliates)
for the sole purpose of covering any short position prior to the exercise of the Over-allotment
Option. The stock borrowing arrangement under the Stock Borrowing Agreement will be
effected in compliance with all applicable laws, Listing Rules and regulatory requirements.
No payment will be made to VPP LU Limited by the Stabilization Manager or its
authorized agents in relation to such stock borrowing arrangement.
UNDERWRITING
The Hong Kong Public Offering is fully underwritten by the Hong Kong Underwriters
under the terms and conditions of the Hong Kong Underwriting Agreement and is subject to,
among other things, the Overall Coordinators (on behalf of the Underwriters) and the Company
agreeing on the Offer Price.
STRUCTURE OF THE GLOBAL OFFERING
– 499 –


--- page 510 ---
The Company expects to enter into the International Underwriting Agreement relating to
the International Offering on the Price Determination Date.
These underwriting arrangements, including the Underwriting Agreements, are
summarized in the section headed “Underwriting” in this prospectus.
CONDITIONS OF THE GLOBAL OFFERING
Acceptance of all applications for Offer Shares will be conditional on, among other
things:
(a) the Listing Committee granting approval for the listing of, and permission to deal in,
the Shares in issue, the Shares to be issued pursuant to the Global Offering
(including any Shares that may be issued pursuant to the Offer Size Adjustment
Option and the Over-allotment Option) and the Shares which may be issued pursuant
to the Post-IPO Share Award Scheme on the Main Board of the Stock Exchange and
such approval not subsequently having been withdrawn or revoked prior to the
commencement of trading of the Shares on the Stock Exchange;
(b) the Offer Price having been agreed between the Overall Coordinators (on behalf
themselves and of the Underwriters) and the Company on the Price Determination
Date;
(c) the execution and delivery of the International Underwriting Agreement on or about
the Price Determination Date; and
(d) the obligations of the Hong Kong Underwriters under the Hong Kong Underwriting
Agreement and the obligations of the International Underwriters under the
International Underwriting Agreement becoming and remaining unconditional and
not having been terminated in accordance with the terms of the respective
agreements or otherwise,
in each case on or before the dates and times specified in the respective Underwriting
Agreements (unless and to the extent such conditions are validly waived on or before such
dates and times).
If, for any reason, the Offer Price is not agreed between the Overall Coordinators (on
behalf of the Underwriters) and the Company by 12:00 noon on Wednesday, March 19, 2025,
the Global Offering will not proceed and will lapse.
The consummation of each of the Hong Kong Public Offering and the International
Offering is conditional upon, among other things, the other offering becoming unconditional
and not having been terminated in accordance with its terms.
STRUCTURE OF THE GLOBAL OFFERING
– 500 –


--- page 511 ---
If the above conditions are not fulfilled or waived prior to the dates and times specified,
the Global Offering will lapse and the Stock Exchange will be notified immediately. Notice of
the lapse of the Hong Kong Public Offering will be published on the websites of the Company
and the Stock Exchange at www.visenpharma.com and www.hkexnews.hk , respectively, on
the next day following such lapse. In such a situation, all application monies will be returned,
without interest, on the terms set out in the section headed “How to Apply for Hong Kong Offer
Shares – D. Despatch/Collection of Share Certificates and Refund of Application Monies” in
this prospectus. In the meantime, all application monies will be held in separate bank
account(s) with the receiving banks or other bank(s) in Hong Kong licensed under the Banking
Ordinance (Chapter 155 of the Laws of Hong Kong).
Share certificates for the Offer Shares will only become valid evidence of title at 8:00
a.m. on Friday, March 21, 2025, provided that the Global Offering has become unconditional
in all respects at or before that time.
DEALINGS IN THE SHARES
Assuming that the Hong Kong Public Offering becomes unconditional at or before 8:00
a.m. in Hong Kong on Friday, March 21, 2025, it is expected that dealings in the Shares on the
Stock Exchange will commence at 9:00 a.m. on Friday, March 21, 2025.
The Shares will be traded in board lots of 100 Shares each and the stock code of the
Shares will be 2561.
NOTICE TO CAPITAL MARKET INTERMEDIARIES AND PROSPECTIVE
INVESTORS PURSUANT TO PARAGRAPH 21 OF THE SFC CODE OF CONDUCT
Important Notice to CMIs (including private banks and broking companies)
This notice to CMIs (including private banks and broking companies) is a summary of
certain obligations the Code of Conduct for Persons Licensed by or Registered with the
Securities and Futures Commission (the “ Code ”) imposes on CMIs, which require the attention
and cooperation of other CMIs (including private banks and broking companies). Certain CMI
may also be acting as the Overall Coordinators for the Global Offering and is subject to
additional requirements under the Code.
Prospective investors to whom the allocation of Offer Shares will be subject to
restrictions or require prior consent from the Stock Exchange under the Listing Rules and other
regulatory requirements or guidance issued by the Stock Exchange from time to time (the
“Stock Exchange Requirements ”) would be considered under the Code as “Restricted
Investors”. Offer Shares may only be allocated to Restricted Investors in accordance with
applicable Stock Exchange Requirements and be made with a view to achieving an open
market, an adequate spread of shareholders and the orderly and fair trading of the shares in the
STRUCTURE OF THE GLOBAL OFFERING
– 501 –


--- page 512 ---
secondary market. Prospective investors should provide all information required by the Stock
Exchange to be submitted in the Stock Exchange’s placee list template or under the Listing
Rules and identify any placee categories set out in the template that apply when placing an
order. Prospective investors who do not indicate that any of the placee categories apply will be
deemed to confirm that none of them apply and represent that they and their respective ultimate
beneficial owners are third parties independent from the Company.
CMIs should specifically disclose whether their investor clients are Restricted Investors
or fall within any of the other placee categories set out in the Stock Exchange’s placee list
template or under the Listing Rules when submitting orders for the Offer Shares. In addition,
private banks and broking companies should take all reasonable steps to identify whether their
investor clients are Restricted Investors or fall within any of the placee categories set out in
the Stock Exchange’s placee list template or under the Listing Rules and inform the
Underwriters accordingly.
CMIs are informed that the marketing and investor targeting strategy for the Global
Offering includes institutional investors, long-only investors, sovereign wealth funds, pension
funds, hedge funds, corporates, private banks/broking companies, family offices and high net
worth individuals, in each case, subject to the applicable Stock Exchange Requirements and the
selling restrictions set out in this prospectus.
CMIs should ensure that orders placed are bona fide, are not inflated and do not constitute
duplicated orders (i.e. two or more corresponding or identical orders placed via two or more
CMIs). CMIs should also ensure that investors (and their respective ultimate beneficial owners)
procured by them are third parties independent of the Company and that the investors (and their
respective ultimate beneficial owners) have the financial capacity to meet all obligations
arising from the order and are not financed directly or indirectly by, or accustomed to taking
instructions from, the Company, any of its Directors, chief executives, controlling
shareholder(s), substantial shareholder(s) or existing shareholder(s) of the Company or any of
its subsidiaries, or a close associate of any of them (as such terms are defined in the Listing
Rules). CMIs should enquire with their investor clients regarding any orders which appear
unusual or irregular. CMIs should disclose the identities of all investors when submitting
orders for the Offer Shares (except for omnibus orders where underlying investor information
may need to be provided to any Overall Coordinators when submitting orders). Failure to
provide underlying investor information for omnibus orders, where required to do so, will
result in that order being rejected. CMIs should not place “X-orders” into the order book.
CMIs should segregate and clearly identify their own proprietary orders (and those of
their group companies, including private banks and broking companies as the case may be) in
the order book and book messages. Proprietary orders may only be allowed subject to the Stock
Exchange Requirements.
STRUCTURE OF THE GLOBAL OFFERING
– 502 –


--- page 513 ---
CMIs (including private banks and broking companies) should not offer any rebates to
prospective investors or pass on any rebates provided by the Company. In addition, CMIs
(including private banks and broking companies) should not enter into arrangements which
may enable any of its investor clients to pay less than the total consideration as specified in this
prospectus for each of the Offer Shares allocated.
The Code requires that a CMI disclose complete and accurate information in a timely
manner on the status of the order book and other relevant information it receives to targeted
investors for them to make an informed decision. In order to do this, those Underwriters in
control of the order book should consider disclosing order book updates to all CMIs.
When placing an order for the Offer Shares, private banks should disclose, at the same
time, if such order is placed other than on a “principal” basis (whereby it is deploying its own
balance sheet for onward selling to investors). Private banks who do not provide such
disclosure are hereby deemed to be placing their order on such a “principal” basis. Private
banks who disclose that they are placing their order other than on a “principal” basis (i.e. they
are acting as an agent) should note that such order may be considered to be an omnibus order
pursuant to the Code. Private banks should be aware that if any of their group companies is a
CMI of the Global Offering, placing an order on a “principal” basis may require the
Underwriters to apply the “proprietary orders” requirements of the Code to such order.
In relation to omnibus orders, when submitting such orders, CMIs (including private
banks and broking companies) are requested to provide the following underlying investor
information in respect of each order constituting the relevant omnibus order (failure to provide
such information will result in that order being rejected). Underlying investor information in
relation to omnibus orders should consist of: (a) the name of each underlying investor; (b) a
unique identification number for each investor; (c) whether an underlying investor is a
“Restricted Investor” (as used in the Code); (d) whether any underlying investor order is a
“Proprietary Order” (as used in the Code); (e) whether any underlying investor order is a
duplicate order. Underlying investor information in relation to omnibus order should be sent to
the Overall Coordinators.
To the extent information being disclosed by CMIs and investors is personal and/or
confidential in nature, CMIs (including private banks and broking companies) agree and
warrant: (a) to take appropriate steps to safeguard the transmission of such information to any
Overall Coordinators; and (b) that they have obtained the necessary consents from the
underlying investors to disclose such information to any Overall Coordinators. By submitting
an order and providing such information to any Overall Coordinators, each CMI (including
private banks and broking companies) further warrants that they and the underlying investors
have understood and consented to the collection, disclosure, use and transfer of such
information by any Overall Coordinators and/or any other third parties as may be required by
the Listing Rules and/or the Code, including to the Company, relevant regulators and/or any
other third parties as may be required by the Listing Rules and/or the Code, for the purpose of
complying with the Listing Rules and/or the Code, during the bookbuilding process for the
Global Offering. CMIs that receive such underlying investor information are reminded that
STRUCTURE OF THE GLOBAL OFFERING
– 503 –


--- page 514 ---
such information should be used only for submitting orders in the Global Offering. The
Underwriters may be asked to demonstrate compliance with their obligations under the Code,
and may request other CMIs (including private banks and broking companies) to provide
evidence showing compliance with the obligations above (in particular, that the necessary
consents have been obtained). In such event, other CMIs (including private banks and broking
companies) are required to provide the Overall Coordinators with such evidence within the
timeline requested.
Important Notice to Prospective Investors
Prospective investors should be aware that certain intermediaries in the context of the
Global Offering of the Offer Shares, including certain Underwriters, are CMIs subject to
Paragraph 21 of the Code. This notice to prospective investors is a summary of certain
obligations the Code imposes on such CMIs, which require the attention and cooperation of
prospective investors. Certain CMIs may also be acting as the Overall Coordinators for the
Global Offering and are subject to additional requirements under the Code.
Prospective investors to whom the allocation of Offer Shares will be subject to
restrictions or require prior consent from the Stock Exchange under the Stock Exchange
Requirements would be considered under the Code as “Restricted Investors”. Offer Shares may
only be allocated to Restricted Investors in accordance with applicable Stock Exchange
Requirements. Prospective investors who are Restricted Investors should specifically disclose
whether they are Restricted Investors when placing an order for the Offer Shares. Prospective
investors who do not disclose they are Restricted Investors are hereby deemed not to be
Restricted Investors and not financed directly or indirectly by, nor accustomed to taking
instructions from the Company or the Restricted Investors.
Prospective investors should provide all information required by the Stock Exchange to
be submitted in the Stock Exchange’s placee list template or under the Listing Rules and
identify any placee categories as set out in the template that apply when placing an order.
Prospective investors who do not indicate that any of the placee categories apply will be
deemed to confirm that none of them apply and represent that they and their respective ultimate
beneficial owners are third parties independent from the Company.
Prospective investors should ensure, and by placing an order prospective investors are
deemed to confirm, that orders placed are bona fide, are not inflated and do not constitute
duplicated orders (i.e. two or more corresponding or identical orders placed via two or more
CMIs). Prospective investors should also ensure, and by placing an order are deemed to
confirm, that they (and their respective ultimate beneficial owners) have the financial capacity
to meet all obligations arising from the order and are not financed directly or indirectly by, or
accustomed to taking instructions from, the Company, any of its Directors, chief executives,
controlling shareholder(s), substantial shareholder(s) or existing shareholder(s) of the
Company or any of its subsidiaries, or a close associate of any of them (as such terms are
defined in the Listing Rules). If a prospective investor is an asset management arm affiliated
with any Underwriter, such prospective investor should indicate when placing an order if it is
STRUCTURE OF THE GLOBAL OFFERING
– 504 –


--- page 515 ---
for a fund or portfolio where the Underwriter or its group company has more than 50% interest,
in which case it will be classified as a “proprietary order” and subject to appropriate handling
by CMIs in accordance with the Code and the Listing Rules. Prospective investors who do not
indicate this information when placing an order are hereby deemed to confirm that their order
is not a “proprietary order”. If a prospective investor is otherwise affiliated with any
Underwriter, such that its order may be considered to be a “proprietary order” (pursuant to the
Code), such prospective investor should indicate to the relevant Underwriter when placing such
order and such orders will be subject to applicable requirements in accordance with the Code
and the Listing Rules. Prospective investors who do not indicate this information when placing
an order are hereby deemed to confirm that their order is not a “proprietary order”.
Prospective investors should be aware that certain information may be disclosed by CMIs
(including private banks and broking companies) which is personal and/or confidential in
nature to the prospective investor. By placing an order, prospective investors are deemed to
have understood and consented to the collection, disclosure, use and transfer of such
information by the Underwriters and/or any other third parties as may be required by the
Listing Rules and/or the Code, including to the Company, the Overall Coordinators, relevant
regulators and/or any other third parties as may be required by the Listing Rules and/or the
Code, it being understood and agreed that such information shall only be used for the purpose
of complying with the Listing Rules and/or the Code, during the bookbuilding process for the
Global Offering. Failure to provide such information will result in that order being rejected.
STRUCTURE OF THE GLOBAL OFFERING
– 505 –


--- page 516 ---
IMPORTANT NOTICE TO INVESTORS
OF HONG KONG OFFER SHARES
FULLY ELECTRONIC APPLICATION PROCESS
We have adopted a fully electronic application process for the Hong Kong
Public Offering and below are the procedures for application.
This prospectus is available at the website of the Stock Exchange at
www.hkexnews.hk under the “HKEXnews > New Listings > New Listing
Information” section, and our website at www.visenpharma.com .
The contents of this prospectus are identical to the prospectus as registered with the
Registrar of Companies in Hong Kong pursuant to Section 342C of the Companies
(Winding Up and Miscellaneous Provisions) Ordinance.
A. APPLICATION FOR HONG KONG OFFER SHARES
1. Who Can Apply
Y ou can apply for Hong Kong Offer Shares if you or the person(s) for whose benefit you
are applying for:
 are 18 years of age or older; and
 have a Hong Kong address (for the White Form eIPO service only).
Unless permitted by the Listing Rules or any relevant waivers and/or consents have been
granted by the Stock Exchange to us, you cannot apply for any Hong Kong Offer Shares if you
or the person(s) for whose benefit you are applying for:
 are an existing Shareholder or close associates; or
 are a Director or any of his/her close associates.
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 506 –


--- page 517 ---
2. Application Channels
The Hong Kong Public Offering period will begin at 9:00 am on Thursday, March 13,
2025 and end at 12:00 noon on Tuesday, March 18, 2025 (Hong Kong time).
To apply for Hong Kong Offer Shares, you may use one of the following application
channels:
Application
Channel Platform Target Investors Application Time
White Form eIPO
service
www.eipo.com.hk Applicants who would like to
receive a physical Share
certificate. Hong Kong Offer
Shares successfully applied for
will be allotted and issued in
your own name.
From 9:00 am on Thursday,
March 13, 2025 to 11:30
a.m. on Tuesday, March
18, 2025, Hong Kong
time.
The latest time for
completing full payment
of application monies will
be 12:00 noon on
Tuesday, March 18, 2025,
Hong Kong time.
HKSCC EIPO
channel
Y our broker or custodian
who is a HKSCC
Participant will submit
electronic application
instruction(s) on your
behalf through HKSCC’s
FINI system in
accordance with your
instruction
Applicants who would not like to
receive a physical Share
certificate. Hong Kong Offer
Shares successfully applied for
will be allotted and issued in
the name of HKSCC Nominees,
deposited directly into CCASS
and credited to your designated
HKSCC Participant’s stock
account.
Contact your broker or
custodian for the earliest
and latest time for giving
such instructions, as this
may vary by broker or
custodian.
The White Form eIPO service and the HKSCC EIPO channel are facilities subject to
capacity limitations and potential service interruptions and you are advised not to wait until the
last day of the application period to apply for Hong Kong Offer Shares.
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 507 –


--- page 518 ---
For those applying through the White Form eIPO service, once you complete payment
in respect of any application instructions given by you or for your benefit through the White
Form eIPO service to make an application for Hong Kong Offer Shares, an actual application
shall be deemed to have been made. If you are a person for whose benefit the electronic
application instructions are given, you shall be deemed to have declared that only one set of
electronic application instructions has been given for your benefit. If you are an agent for
another person, you shall be deemed to have declared that you have only given one set of
electronic application instructions for the benefit of the person for whom you are an agent and
that you are duly authorized to give those instructions as an agent.
For the avoidance of doubt, giving an application instruction under the White Form eIPO
service more than once and obtaining different application reference numbers without effecting
full payment in respect of a particular reference number will not constitute an actual
application.
If you apply through the White Form eIPO service, you are deemed to have authorized
the White Form eIPO service provider to apply on the terms and conditions in this prospectus,
as supplemented and amended by the terms and conditions of the White Form eIPO service.
By instructing your broker or custodian to apply for the Hong Kong Offer Shares on your
behalf through the HKSCC EIPO channel, you (and, if you are joint applicants, each of you
jointly and severally) are deemed to have instructed and authorized HKSCC to cause HKSCC
Nominees (acting as nominee for the relevant HKSCC Participants) to apply for Hong Kong
Offer Shares on your behalf and to do on your behalf all the things stated in this prospectus
and any supplement to it.
For those applying through HKSCC EIPO channel, an actual application will be deemed
to have been made for any application instructions given by you or for your benefit to HKSCC
(in which case an application will be made by HKSCC Nominees on your behalf) provided such
application instruction has not been withdrawn or otherwise invalidated before the closing time
of the Hong Kong Public Offering.
HKSCC Nominees will only be acting as a nominee for you and neither HKSCC nor
HKSCC Nominees shall be liable to you or any other person in respect of any actions taken by
HKSCC or HKSCC Nominees on your behalf to apply for Hong Kong Offer Shares or for any
breach of the terms and conditions of this prospectus.
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 508 –


--- page 519 ---
3. Information Required to Apply
Y ou must provide the following information with your application:
For Individual/Joint Applicants For Corporate Applicants
 Full name(s) 2 as shown on your
identity document
 Identity document’s issuing country or
jurisdiction
 Identity document type, with order of
priority:
i. HKID card; or
ii. National identification document;
or
iii. Passport; and
 Identity document number
 Full name(s)
2 as shown on your
identity document
 Identity document’s issuing country or
jurisdiction
 Identity document type, with order of
priority:
i. LEI registration document; or
ii. Certificate of incorporation; or
iii. Business registration certificate;
or
iv. Other equivalent document; and
 Identity document number
Notes:
1. If you are applying through the White Form eIPO service, you are required to provide a valid e-mail address,
a contact telephone number and a Hong Kong address. Y ou are also required to declare that the identity
information provided by you follows the requirements as described in Note 2 below. In particular, where you
cannot provide a HKID number, you must confirm that you do not hold a HKID card.
2. The applicant’s full name as shown on their identity document must be used. If an applicant’s identity
document contains both an English and Chinese name, both English and Chinese names must be used.
Otherwise, either English or Chinese names will be accepted. The order of priority of the applicant’s identity
document type must be strictly followed and where an individual applicant has a valid HKID card, the HKID
number must be used when making an application to subscribe for Hong Kong Offer Shares. Similarly for
corporate applicants, a LEI number must be used if an entity has a LEI certificate.
3. If the applicant is a trustee, the client identification data (“ CID”) of the trustee, as set out above, will be
required. If the applicant is an investment fund (i.e. a collective investment scheme, or CIS), the CID of the
asset management company or the individual fund, as appropriate, which has opened a trading account with
the broker will be required, as above.
4. The maximum number of joint applicants on FINI is capped at 4 in accordance with market practice.
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 509 –


--- page 520 ---
5. If you are applying as a nominee, you must provide: (i) the full name (as shown on the identity document),
the identity document’s issuing country or jurisdiction, the identity document type; and (ii), the identity
document number, for each of the beneficial owners or, in the case(s) of joint beneficial owners, for each joint
beneficial owner. If you do not include this information, the application will be treated as being made for your
benefit.
6. If you are applying as an unlisted company and (i) the principal business of that company is dealing in
securities; and (ii) you exercise statutory control over that company, then the application will be treated as
being for your benefit and you should provide the required information in your application as stated above.
“Unlisted company” means a company with no equity securities listed on the Stock Exchange or any other
stock exchange.
“Statutory control” means you:
 control the composition of the board of directors of the company;
 control more than half of the voting power of the company; or
 hold more than half of the issued share capital of the company (not counting any part of it which carries
no right to participate beyond a specified amount in a distribution of either profits or capital).
For those applying through HKSCC EIPO channel, and making an application under a
power of attorney, we and the Overall Coordinators, as our agent, have discretion to consider
whether to accept it on any conditions we think fit, including evidence of the attorney’s
authority.
Failing to provide any required information may result in your application being rejected.
4. Permitted Number of Hong Kong Offer Shares for Application
Board lot size : 100 Shares
Permitted number of
Hong Kong Offer
Shares for
application and
amount payable on
application/successful
allotment
: Hong Kong Offer Shares are available for application
in specified board lot sizes only. Please refer to the
amount payable associated with each specified board
lot size in the table below.
The maximum Offer Price is HK$75.28 per Offer
Share. If you are applying through the HKSCC EIPO
channel, you are required to pre-fund your
application based on the amount specified by your
broker or custodian, as determined based on the
applicable laws and regulations in Hong Kong. Y ou
are responsible for complying with any such
pre-funding requirement imposed by your broker or
custodian with respect to the Hong Kong Offer Shares
you applied for.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 521 ---
By instructing your broker or custodian to apply for
the Hong Kong Offer Shares on your behalf through
the HKSCC EIPO channel, you (and, if you are joint
applicants, each of you jointly and severally) are
deemed to have instructed and authorized HKSCC to
cause HKSCC Nominees (acting as nominee for the
relevant HKSCC Participants) to arrange payment of
the final Offer Price, brokerage, SFC transaction levy,
the Stock Exchange trading fee and the AFRC
transaction levy by debiting the relevant nominee
bank account at the Designated Bank for your broker
or custodian.
If you are applying through the White Form eIPO
service, you may refer to the table below for the
amount payable for the number of Shares you have
selected. Y ou must pay the respective maximum
amount payable on application in full upon
application for Hong Kong Offer Shares.
VISEN Pharmaceuticals (Stock Code 2561)
(HK$75.28 per Hong Kong Offer Share)
NUMBER OF HONG KONG OFFER SHARES THAT MAY BE APPLIED FOR AND PAYMENTS
No. of
Hong Kong
Offer Shares
applied for
Maximum
Amount
payable (2) on
application
No. of
Hong Kong
Offer Shares
applied for
Maximum
Amount
payable (2) on
application
No. of
Hong Kong
Offer Shares
applied for
Maximum
Amount
payable (2) on
application
No. of
Hong Kong
Offer Shares
applied for
Maximum
Amount
payable (2) on
application
HK$ HK$ HK$ HK$
100 7,603.92 1,500 114,058.80 8,000 608,313.59 90,000 6,843,527.89
200 15,207.84 2,000 152,078.41 9,000 684,352.79 100,000 7,603,919.88
300 22,811.76 2,500 190,097.99 10,000 760,391.99 150,000 11,405,879.82
400 30,415.68 3,000 228,117.60 20,000 1,520,783.98 200,000 15,207,839.75
500 38,019.61 3,500 266,137.20 30,000 2,281,175.97 250,000 19,009,799.70
600 45,623.52 4,000 304,156.79 40,000 3,041,567.95 300,000 22,811,759.65
700 53,227.44 4,500 342,176.40 50,000 3,801,959.95 350,000 26,613,719.58
800 60,831.36 5,000 380,195.99 60,000 4,562,351.93 400,000 30,415,679.52
900 68,435.28 6,000 456,235.20 70,000 5,322,743.91 450,000 34,217,639.45
1,000 76,039.19 7,000 532,274.39 80,000 6,083,135.90 495,000
(1) 37,639,403.41
(1) Maximum number of Hong Kong Offer Share you may apply for, and this is 50% of the Hong Kong Offer
Shares initially offered.
(2) The amount payable is inclusive of brokerage, SFC transaction levy, the Stock Exchange trading fee and AFRC
transaction levy. If your application is successful, brokerage will be paid to the Exchange Participants (as
defined in the Listing Rules) and the SFC transaction levy, the Stock Exchange trading fee and AFRC
transaction levy are paid to the Stock Exchange (in the case of the SFC transaction levy, collected by the Stock
Exchange on behalf of the SFC; and in the case of the AFRC transaction levy, collected by the Stock Exchange
on behalf of the AFRC).
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–5 1 1–


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5. Multiple Applications Prohibited
Y ou or your joint applicant(s) shall not make more than one application for your own
benefit, except where you are a nominee and provide the information of the underlying investor
in your application as required under the paragraph headed “ — A. Application for Hong Kong
Offer Shares — 3. Information Required to Apply ” in this section. If you are suspected of
submitting or cause to submit more than one application, all of your applications will be
rejected.
Multiple applications made either through (i) the White Form eIPO service, (ii) HKSCC
EIPO channel, or (iii) both channels concurrently are prohibited and will be rejected. If you
have made an application through the White Form eIPO service or HKSCC EIPO channel,
you or the person(s) for whose benefit you have made the application shall not apply for any
Offer Shares.
6. Terms and Conditions of An Application
By applying for Hong Kong Offer Shares through the White Form eIPO service or
HKSCC EIPO channel, you (or as the case may be, HKSCC Nominees will do the following
things on your behalf):
(i) undertake to execute all relevant documents and instruct and authorise us and/or the
Overall Coordinators, as our agents, to execute any documents for you and to do on
your behalf all things necessary to register any Hong Kong Offer Shares allocated
to you in your name or in the name of HKSCC Nominees as required by the Articles
of Association, and (if you are applying through the HKSCC EIPO channel) to
deposit the allotted Hong Kong Offer Shares directly into CCASS for the credit of
your designated HKSCC Participant’s stock account on your behalf;
(ii) confirm that you have read and understand the terms and conditions and application
procedures set out in this prospectus and the designated website of the White Form
eIPO service (or as the case may be, the agreement you entered into with your
broker or custodian), and agree to be bound by them;
(iii) (if you are applying through the HKSCC EIPO channel) agree to the arrangements,
undertakings and warranties under the participant agreement between your broker or
custodian and HKSCC and observe the General Rules of HKSCC and the HKSCC
Operational Procedures for giving application instructions to apply for Hong Kong
Offer Shares;
(iv) confirm that you are aware of the restrictions on offers and sales of shares set out
in this prospectus and they do not apply to you, or the person(s) for whose benefit
you have made the application;
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 523 ---
(v) confirm that you have read this prospectus and any supplement to it and have relied
only on the information and representations contained therein in making your
application (or as the case may be, causing your application to be made) and will not
rely on any other information or representations;
(vi) agree that the Relevant Persons
1, the Hong Kong Share Registrar and HKSCC will
not be liable for any information and representations not in this prospectus and any
supplement to it;
(vii) agree to disclose the details of your application and your personal data and any other
personal data which may be required about you and the person(s) for whose benefit
you have made the application to us, the Relevant Persons, the Hong Kong Share
Registrar, HKSCC, HKSCC Nominees, the Stock Exchange, the SFC and any other
statutory regulatory or governmental bodies or otherwise as required by laws, rules
or regulations, for the purposes under the paragraph headed “ — G. Personal Data
— 3. Purposes ” and “ — 4. Transfer of personal data ” in this section;
(viii) agree (without prejudice to any other rights which you may have once your
application (or as the case may be, HKSCC Nominees’ application) has been
accepted) that you will not rescind it because of an innocent misrepresentation;
(ix) agree that subject to Section 44A(6) of the Companies (Winding Up and
Miscellaneous Provisions) Ordinance, any application made by you or HKSCC
Nominees on your behalf cannot be revoked once it is accepted, which will be
evidenced by the notification of the result of the ballot by the Hong Kong Share
Registrar by way of publication of the results at the time and in the manner as
specified in the paragraph headed “— B. Publication of Results ” in this section;
(x) confirm that you are aware of the situations specified in the paragraph headed “ —
C. Circumstances In Which You Will Not Be Allocated Hong Kong Offer Shares ”i n
this section;
(xi) agree that your application or HKSCC Nominees’ application, any acceptance of it
and the resulting contract will be governed by and construed in accordance with the
laws of Hong Kong;
1 As defined in this prospectus, Relevant Persons would include the Company, Joint Sponsors, the Overall
Coordinators, the Joint Global Coordinators, the Joint Bookrunners, the Joint Lead Managers, the
Underwriters, the Capital Market Intermediaries, and any of their respective directors, officers, employees,
partners, agents, advisers, representatives and any other parties involved in the Global Offering.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 524 ---
(xii) agree to comply with the Companies Ordinance, the Companies (Winding Up and
Miscellaneous Provisions) Ordinance, the Articles of Association and laws of any
place outside Hong Kong that apply to your application and that neither we nor the
Relevant Persons will breach any law inside and/or outside Hong Kong as a result
of the acceptance of your offer to purchase, or any action arising from your rights
and obligations under the terms and conditions contained in this prospectus;
(xiii) confirm that (a) your application or HKSCC Nominees’ application on your behalf
is not financed directly or indirectly by the Company, any of the directors, chief
executives, substantial Shareholder(s) or existing shareholder(s) of the Company or
any of its subsidiaries or any of their respective close associates; and (b) you are not
accustomed or will not be accustomed to taking instructions from the Company, any
of the directors, chief executives, substantial shareholder(s) or existing
shareholder(s) of the Company or any of its subsidiaries or any of their respective
close associates in relation to the acquisition, disposal, voting or other disposition
of the Shares registered in your name or otherwise held by you;
(xiv) warrant that the information you have provided is true and accurate;
(xv) confirm that you understand that we and the Overall Coordinators will rely on your
declarations and representations in deciding whether or not to allocate any Hong
Kong Offer Shares to you and that you may be prosecuted for making a false
declaration;
(xvi) agree to accept Hong Kong Offer Shares applied for or any lesser number allocated
to you under the application;
(xvii) declare and represent that this is the only application made and the only application
intended by you to be made to benefit you or the person for whose benefit you are
applying;
(xviii) (if the application is made for your own benefit) warrant that no other application
has been or will be made for your benefit by giving electronic application
instructions to HKSCC directly or indirectly or through the application channel of
the Hong Kong Share Registrar or by any one as your agent or by any other person;
and
(xix) (if you are making the application as an agent for the benefit of another person)
warrant that (1) no other application has been or will be made by you as agent for
or for the benefit of that person or by that person or by any other person as agent
for that person by giving electronic application instructions to HKSCC and (2) you
have due authority to give electronic application instructions on behalf of that other
person as its agent.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 525 ---
B. PUBLICATION OF RESULTS
Results of Allocation
Y ou can check whether you are successfully allocated any Hong Kong Offer Shares
through:
Platform Date/Time
Applying through White Form eIPO service or HKSCC EIPO channel :
Website The designated results of allocations website
at www.iporesults.com.hk (alternatively:
www.eipo.com.hk/eIPOAllotment ) with a
“search by ID” function.
The full list of (i) wholly or partially
successful applicants using the White
Form eIPO service and HKSCC EIPO
channel, and (ii) the number of Hong Kong
Offer Shares conditionally allotted to them,
among other things, will be displayed on
the “Allotment Results” page of the White
Form eIPO service at
www.iporesults.com.hk (alternatively:
www.eipo.com.hk/eIPOAllotment ).
24 hours, from 11:00 p.m. on
Thursday, March 20, 2025 to
12:00 midnight on
Wednesday, March 26, 2025
(Hong Kong time).
The Stock Exchange’s website at
www.hkexnews.hk and our website at
www.visenpharma.com which will provide
links to the above mentioned websites of
the Hong Kong Share Registrar.
No later than 11:00 p.m. on
Thursday, March 20, 2025
(Hong Kong time).
Telephone +852 2862 8555 – the allocation results
telephone enquiry line provided by the
Hong Kong Share Registrar.
Between 9:00 a.m. and 6:00
p.m., from Friday, March 21,
2025 to Wednesday, March
26, 2025 (Hong Kong time).
For those applying through HKSCC EIPO channel, you may also check with your broker
or custodian from 6:00 p.m. on Wednesday, March 19, 2025 (Hong Kong time)
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 526 ---
HKSCC Participants can log into FINI and review the allotment result from 6:00 p.m. on
Wednesday, March 19, 2025 (Hong Kong time) on a 24-hour basis and should report any
discrepancies on allotments to HKSCC as soon as practicable.
Allocation Announcement
We expect to announce, the level of indications of interest in the International Offering,
the level of applications in the Hong Kong Public Offering and the basis of allocations of Hong
Kong Offer Shares on the Stock Exchange’s website at www.hkexnews.hk and our website at
www.visenpharma.com by no later than 11:00 p.m. on Thursday, March 20, 2025 (Hong Kong
time).
C. CIRCUMSTANCES IN WHICH YOU WILL NOT BE ALLOCATED HONG KONG
OFFER SHARES
Y ou should note the following situations in which Hong Kong Offer Shares will not be
allocated to you or the person(s) for whose benefit you are applying for:
1. If your application is revoked:
Y our application or the application made by HKSCC Nominees on your behalf may be
revoked pursuant to Section 44A(6) of the Companies (Winding Up and Miscellaneous
Provisions) Ordinance.
2. If we or our agents exercise our discretion to reject your application:
We, the Overall Coordinators, the Hong Kong Share Registrar and their respective agents
and nominees have full discretion to reject or accept any application, or to accept only part of
any application, without giving any reasons.
3. If the allocation of Hong Kong Offer Shares is void:
The allocation of Hong Kong Offer Shares will be void if the Stock Exchange does not
grant permission to list the Shares either:
 within three weeks from the closing date of the application lists; or
 within a longer period of up to six weeks if the Stock Exchange notifies us of that
longer period within three weeks of the closing date of the application lists.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 527 ---
4. If:
 you make multiple applications or suspected multiple applications. Y ou may refer to
the paragraph headed “ — A. Application for Hong Kong Offer Shares — 5. Multiple
Applications Prohibited ” in this section on what constitutes multiple applications;
 your application instruction is incomplete;
 your payment (or confirmation of funds, as the case may be) is not made correctly;
 the Underwriting Agreements do not become unconditional or are terminated;
 we or the Overall Coordinators believe that by accepting your application, it or we
would violate applicable securities or other laws, rules or regulations.
5. If there is money settlement failure for allotted Shares:
Based on the arrangements between HKSCC Participants and HKSCC, HKSCC
Participants will be required to hold sufficient application funds on deposit with their
Designated Bank before balloting. After balloting of Hong Kong Offer Shares, the Receiving
Bank will collect the portion of these funds required to settle each HKSCC Participant’s actual
Hong Kong Offer Share allotment from their Designated Bank.
There is a risk of money settlement failure. In the extreme event of money settlement
failure by a HKSCC Participant (or its Designated Bank), who is acting on your behalf in
settling payment for your allotted shares, HKSCC will contact the defaulting HKSCC
Participant and its Designated Bank to determine the cause of failure and request such
defaulting HKSCC Participant to rectify or procure to rectify the failure.
However, if it is determined that such settlement obligation cannot be met, the affected
Hong Kong Offer Shares will be reallocated to the International Offering. Hong Kong Offer
Shares applied for by you through the broker or custodian may be affected to the extent of the
settlement failure. In the extreme case, you will not be allocated any Hong Kong Offer Shares
due to the money settlement failure by such HKSCC Participant. None of us, the Relevant
Persons, the Hong Kong Share Registrar and HKSCC is or will be liable if Hong Kong Offer
Shares are not allocated to you due to the money settlement failure.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 528 ---
D. DESPATCH/COLLECTION OF SHARE CERTIFICATES AND REFUND OF
APPLICATION MONIES
Y ou will receive one Share certificate for all Hong Kong Offer Shares allotted to you
under the Hong Kong Public Offering (except pursuant to applications made through the
HKSCC EIPO channel where the Share certificates will be deposited into CCASS as described
below).
No temporary document of title will be issued in respect of the Shares. No receipt will
be issued for sums paid on application.
Share certificates will only become valid evidence of title at 8:00 a.m. on Friday, March
21, 2025 (Hong Kong time), provided that the Global Offering has become unconditional and
the right of termination described in the section headed “Underwriting” has not been exercised.
Investors who trade Shares prior to the receipt of Share certificates or the Share certificates
becoming valid do so entirely at their own risk.
The right is reserved to retain any Share certificate(s) and (if applicable) any surplus
application monies pending clearance of application monies.
The following sets out the relevant procedures and time:
White Form eIPO service HKSCC EIPO channel
Despatch/collection of Share certificate 2
For physical share
certificates of equal or
over 100,000 Offer Shares
issued under your own
name
Collection in person from the
Hong Kong Share Registrar,
Computershare Hong Kong
Investor Services Limited, at
Shops 1712-1716, 17th Floor,
Hopewell Centre, 183 Queen’s
Road East, Wan Chai, Hong
Kong
Share certificate(s) will be
issued in the name of HKSCC
Nominees, deposited into
CCASS and credited to your
designated HKSCC
Participant’s stock account
No action by you is required
2 Except in the event of a tropical cyclone warning signal number 8 or above, a black rainstorm warning and/or
an “extreme conditions” announcement issued after a super typhoon in force in Hong Kong in the morning on
Thursday, March 20, 2025 rendering it impossible for the relevant share certificates to be dispatched to
HKSCC in a timely manner, the Company shall procure the Hong Kong Share Registrar to arrange for delivery
of the supporting documents and share certificates in accordance with the contingency arrangements as agreed
between them. Y ou may refer to “— E. Severe Weather Arrangements ” in this section.
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 518 –


--- page 529 ---
White Form eIPO service HKSCC EIPO channel
Time : from 9:00 a.m. to
1:00 p.m. on Friday,
March 21, 2025
(Hong Kong time)
If you are an individual, you
must not authorise any other
person to collect for you. If
you are a corporate applicant,
your authorised representative
must bear a letter of
authorization from your
corporation stamped with your
corporation’s chop
Both individuals and
authorised representatives
must produce, at the time of
collection, evidence of
identity acceptable to the
Hong Kong Share Registrar
Note: If you do not collect
your Share certificate(s)
personally within the time
above, it/they will be sent to
the address specified in your
application instructions by
ordinary post at your own risk
For physical share
certificates of less than
100,000 Offer Shares
issued under your own
name
Y our Share certificate(s) will
be sent to the address
specified in your application
instructions by ordinary post
at your own risk
Time: Thursday, March 20,
2025
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 530 ---
White Form eIPO service HKSCC EIPO channel
Refund mechanism for surplus application monies paid by you
Date Friday, March 21, 2025 Subject to the arrangement
between you and your broker
or custodian
Responsible party Hong Kong Share Registrar Y our broker or custodian
Application monies paid
through single bank
account
Application monies paid
through multiple bank
accounts
White Form e-Refund
payment instructions to your
designated bank account
Refund cheque(s) will be
despatched to the address as
specified in your application
instructions by ordinary post
at your own risk
Y our broker or custodian will
arrange refund to your
designated bank account
subject to the arrangement
between you and it
E. SEVERE WEATHER ARRANGEMENTS
The Opening and Closing of the Application Lists
The application lists will not open or close on Tuesday, March 18, 2025 if, there is:
 a tropical cyclone warning signal number 8 or above;
 a black rainstorm warning; and/or
 an Extreme Conditions,
(collectively, “ Severe Weather Signals ”),
in force in Hong Kong at any time between 9:00 a.m. and 12:00 noon on Tuesday, March 18,
2025.
Instead they will open between 11:45 a.m. and 12:00 noon and/or close at 12:00 noon on
the next business day which does not have Severe Weather Signals in force at any time between
9:00 a.m. and 12:00 noon.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 531 ---
Prospective investors should be aware that a postponement of the opening/closing of the
application lists may result in a delay in the listing date. Should there be any changes to the
dates mentioned in the section headed “Expected Timetable” in this prospectus, an
announcement will be made and published on the Stock Exchange’s website at
www.hkexnews.hk and our website at www.visenpharma.com of the revised timetable.
If a Severe Weather Signal is hoisted on Thursday, March 20, 2025, the Hong Kong Share
Registrar will make appropriate arrangements for the delivery of the share certificates to the
CCASS Depository’s service counter so that they would be available for trading on Friday,
March 21, 2025.
If a Severe Weather Signal is hoisted on Friday, March 21, 2025, for physical share
certificates of 100,000 or more Offer Shares issued under your own name, you may collect the
physical share certificates from the Hong Kong Share Registrar’s office after the Severe
Weather Signal is lowered or cancelled (e.g. in the afternoon of Friday, March 21, 2025 or on
Monday, March 24, 2025).
If a Severe Weather Signal is hoisted on Thursday, March 20, 2025: for physical share
certificates of less than 100,000 of Offer Shares issued under your own name, despatch will be
made by ordinary post when the post office re-opens after the Severe Weather Signal is lowered
or cancelled (e.g. in the afternoon of Thursday, March 20, 2025 or on Friday, March 21, 2025).
Prospective investors should be aware that if they choose to receive physical share
certificates issued in their own name, there may be a delay in receiving the share
certificates.
F. ADMISSION OF THE SHARES INTO CCASS
If the Stock Exchange grants the listing of, and permission to deal in, the Shares in issue,
the Shares to be issued pursuant to the Global Offering (including any Shares that may be
issued pursuant to the Offer Size Adjustment Option and the Over-allotment Option) and the
Shares which may be issued pursuant to the Post-IPO Share Award Scheme on the Stock
Exchange and we comply with the stock admission requirements of HKSCC, the Shares will
be accepted as eligible securities by HKSCC for deposit, clearance and settlement in CCASS
with effect from the date of commencement of dealings in the Shares or any other date HKSCC
chooses. Settlement of transactions between Exchange Participants is required to take place in
CCASS on the second settlement day after any trading day.
All activities under CCASS are subject to the General Rules of HKSCC and the HKSCC
Operational Procedures in effect from time to time.
All necessary arrangements have been made enabling the Shares to be admitted into
CCASS.
Y ou should seek the advice of your broker or other professional advisor for details of the
settlement arrangement as such arrangements may affect your rights and interests.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 532 ---
G. PERSONAL DATA
The following Personal Information Collection Statement applies to any personal data
collected and held by the Company, the Hong Kong Share Registrar, the receiving bank and the
Relevant Persons about you in the same way as it applies to personal data about applicants
other than HKSCC Nominees. This personal data may include client identifier(s) and your
identification information. By giving application instructions to HKSCC, you acknowledge
that you have read, understood and agree to all of the terms of the Personal Information
Collection Statement below.
1. Personal Information Collection Statement
This Personal Information Collection Statement informs the applicant for, and holder of,
Hong Kong Offer Shares, of the policies and practices of the Company and the Hong Kong
Share Registrar in relation to personal data and the Personal Data (Privacy) Ordinance (Chapter
486 of the Laws of Hong Kong).
2. Reasons for the collection of your personal data
It is necessary for applicants and registered holders of Hong Kong Offer Shares to ensure
that personal data supplied to the Company or its agents and the Hong Kong Share Registrar
is accurate and up-to-date when applying for Hong Kong Offer Shares or transferring Hong
Kong Offer Shares into or out of their names or in procuring the services of the Hong Kong
Share Registrar.
Failure to supply the requested data or supplying inaccurate data may result in your
application for Hong Kong Offer Shares being rejected, or in the delay or the inability of the
Company or the Hong Kong Share Registrar to effect transfers or otherwise render their
services. It may also prevent or delay registration or transfers of Hong Kong Offer Shares
which you have successfully applied for and/or the despatch of Share certificate(s) to which
you are entitled.
It is important that applicants for and holders of Hong Kong Offer Shares inform the
Company and the Hong Kong Share Registrar immediately of any inaccuracies in the personal
data supplied.
3. Purposes
Y our personal data may be used, held, processed, and/or stored (by whatever means) for
the following purposes:
 processing your application and refund cheque and e-Refund payment instruction(s),
where applicable, verification of compliance with the terms and application
procedures set out in this prospectus and announcing results of allocation of Hong
Kong Offer Shares;
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 522 –


--- page 533 ---
 compliance with applicable laws and regulations in Hong Kong and elsewhere;
 registering new issues or transfers into or out of the names of the holders of the
Shares including, where applicable, HKSCC Nominees;
 maintaining or updating the register of members of the Company;
 verifying identities of applicants for and holders of the Shares and identifying any
duplicate applications for the Shares;
 facilitating Hong Kong Offer Shares balloting;
 establishing benefit entitlements of holders of the Shares, such as dividends, rights
issues, bonus issues, etc.;
 distributing communications from the Company and its subsidiaries;
 compiling statistical information and profiles of the holder of the Shares;
 disclosing relevant information to facilitate claims on entitlements; and
 any other incidental or associated purposes relating to the above and/or to enable the
Company and the Hong Kong Share Registrar to discharge their obligations to
applicants and holders of the Shares and/or regulators and/or any other purposes to
which applicants and holders of the Shares may from time to time agree.
4. Transfer of personal data
Personal data held by the Company and the Hong Kong Share Registrar relating to the
applicants for and holders of Hong Kong Offer Shares will be kept confidential but the
Company and the Hong Kong Share Registrar may, to the extent necessary for achieving any
of the above purposes, disclose, obtain or transfer (whether within or outside Hong Kong) the
personal data to, from or with any of the following:
 the Company’s appointed agents such as financial advisers, receiving bank and
overseas principal share registrar;
 HKSCC or HKSCC Nominees, who will use the personal data and may transfer the
personal data to the Hong Kong Share Registrar, in each case for the purposes of
providing its services or facilities or performing its functions in accordance with its
rules or procedures and operating FINI and CCASS (including where applicants for
the Hong Kong Offer Shares request a deposit into CCASS);
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 523 –


--- page 534 ---
 any agents, contractors or third-party service providers who offer administrative,
telecommunications, computer, payment or other services to the Company or the
Hong Kong Share Registrar in connection with their respective business operation;
 the Stock Exchange, the SFC and any other statutory regulatory or governmental
bodies or otherwise as required by laws, rules or regulations, including for the
purpose of the Stock Exchange’s administration of the Listing Rules and the SFC’s
performance of its statutory functions; and
 any persons or institutions with which the holders of Hong Kong Offer Shares have
or propose to have dealings, such as their bankers, solicitors, accountants or brokers
etc.
5. Retention of personal data
The Company and the Hong Kong Share Registrar will keep the personal data of the
applicants and holders of Hong Kong Offer Shares for as long as necessary to fulfil the
purposes for which the personal data were collected. Personal data which is no longer required
will be destroyed or dealt with in accordance with the Personal Data (Privacy) Ordinance
(Chapter 486 of the Laws of Hong Kong).
6. Access to and correction of personal data
Applicants for and holders of Hong Kong Offer Shares have the right to ascertain whether
the Company or the Hong Kong Share Registrar hold their personal data, to obtain a copy of
that data, and to correct any data that is inaccurate. The Company and the Hong Kong Share
Registrar have the right to charge a reasonable fee for the processing of such requests. All
requests for access to data or correction of data should be addressed to the Company and the
Hong Kong Share Registrar, at their registered address disclosed in the section headed
“Corporate information” in this prospectus or as notified from time to time, for the attention
of the company secretary, or the Hong Kong Share Registrar for the attention of the privacy
compliance officer.
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 524 –


--- page 535 ---
The following is the text of a report received from the independent reporting accountants,
Ernst & Y oung, Certified Public Accountants, Hong Kong, prepared for the purpose of
incorporation in this Prospectus.
⭰㰟㛪姯⸒Ṳ⋀㈧
榀㸖毩歁㵳勘䙮怺979噆
⤑⏋✱ᷧ⺎27㧺
Tel 曢婘: +852 2846 9888
Fax ₚ䜆: +852 2868 4432
ey.com
Ernst & Young
27/F, One Taikoo Place
979 King’s Road
Quarry Bay, Hon
g Kong
ACCOUNTANTS’ REPORT ON HISTORICAL FINANCIAL INFORMATION TO THE
DIRECTORS OF VISEN PHARMACEUTICALS, MORGAN STANLEY ASIA LIMITED
AND JEFFERIES HONG KONG LIMITED
INTRODUCTION
We report on the historical financial information of VISEN Pharmaceuticals (the
“Company”) and its subsidiaries (together, the “Group”) set out on pages I-4 to 57, which
comprises the consolidated statements of profit or loss and other comprehensive income,
statements of changes in equity and statements of cash flows of the Group for each of the years
ended 31 December 2022 and 2023 and the nine months ended 30 September 2024 (the
“Relevant Periods”), and the consolidated statements of financial position of the Group and the
statements of financial position of the Company as at 31 December 2022 and 2023 and 30
September 2024 and material accounting policy information and other explanatory information
(together, the “Historical Financial Information”). The Historical Financial Information set out
on pages I-4 to 57 forms an integral part of this report, which has been prepared for inclusion
in the prospectus of the Company dated 13 March 2025 (the “Prospectus”) in connection with
the initial listing of the shares of the Company on the Main Board of The Stock Exchange of
Hong Kong Limited (the “Stock Exchange”).
DIRECTORS’ RESPONSIBILITY FOR THE HISTORICAL FINANCIAL
INFORMATION
The directors of the Company are responsible for the preparation of the Historical
Financial Information that gives a true and fair view in accordance with the basis of preparation
set out in note 2.1 to the Historical Financial Information, and for such internal control as the
directors determine is necessary to enable the preparation of the Historical Financial
Information that is free from material misstatement, whether due to fraud or error.
APPENDIX I ACCOUNTANTS’ REPORT
– I-1 –


--- page 536 ---
REPORTING ACCOUNTANTS’ RESPONSIBILITY
Our responsibility is to express an opinion on the Historical Financial Information and to
report our opinion to you. We conducted our work in accordance with Hong Kong Standard on
Investment Circular Reporting Engagements 200 Accountants’ Reports on Historical Financial
Information in Investment Circulars issued by the Hong Kong Institute of Certified Public
Accountants (“HKICPA”). This standard requires that we comply with ethical standards and
plan and perform our work to obtain reasonable assurance about whether the Historical
Financial Information is free from material misstatement.
Our work involved performing procedures to obtain evidence about the amounts and
disclosures in the Historical Financial Information. The procedures selected depend on the
reporting accountants’ judgement, including the assessment of risks of material misstatement
of the Historical Financial Information, whether due to fraud or error. In making those risk
assessments, the reporting accountants consider internal control relevant to the entity’s
preparation of the Historical Financial Information that gives a true and fair view in accordance
with the basis of preparation set out in note 2.1 to the Historical Financial Information in order
to design procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the entity’s internal control. Our work also
included evaluating the appropriateness of accounting policies used and the reasonableness of
accounting estimates made by the directors, as well as evaluating the overall presentation of
the Historical Financial Information.
We believe that the evidence we have obtained is sufficient and appropriate to provide a
basis for our opinion.
OPINION
In our opinion, the Historical Financial Information gives, for the purposes of the
accountants’ report, a true and fair view of the financial position of the Group and the Company
as at 31 December 2022 and 2023 and 30 September 2024 and of the financial performance and
cash flows of the Group for each of the Relevant Periods in accordance with the basis of
preparation set out in note 2.1 to the Historical Financial Information.
REVIEW OF INTERIM COMPARATIVE FINANCIAL INFORMATION
We have reviewed the interim comparative financial information of the Group which
comprises the consolidated statement of profit or loss and other comprehensive income,
statement of changes in equity and statement of cash flows for the nine months ended 30
September 2023 and other explanatory information (the “Interim Comparative Financial
Information”). The directors of the Company are responsible for the preparation of the Interim
Comparative Financial Information in accordance with the basis of preparation set out in note
2.1 to the Historical Financial Information. Our responsibility is to express a conclusion on the
APPENDIX I ACCOUNTANTS’ REPORT
– I-2 –


--- page 537 ---
Interim Comparative Financial Information based on our review. We conducted our review in
accordance with Hong Kong Standard on Review Engagements 2410 Review of Interim
Financial Information Performed by the Independent Auditor of the Entity issued by the
HKICPA. A review consists of making inquiries, primarily of persons responsible for financial
and accounting matters, and applying analytical and other review procedures. A review is
substantially less in scope than an audit conducted in accordance with Hong Kong Standards
on Auditing and consequently does not enable us to obtain assurance that we would become
aware of all significant matters that might be identified in an audit. Accordingly, we do not
express an audit opinion. Based on our review, nothing has come to our attention that causes
us to believe that the Interim Comparative Financial Information, for the purposes of the
accountants’ report, is not prepared, in all material respects, in accordance with the basis of
preparation set out in note 2.1 to the Historical Financial Information.
REPORT ON MATTERS UNDER THE RULES GOVERNING THE LISTING OF
SECURITIES ON THE STOCK EXCHANGE AND THE COMPANIES (WINDING UP
AND MISCELLANEOUS PROVISIONS) ORDINANCE
Adjustments
In preparing the Historical Financial Information, no adjustments to the Underlying
Financial Statements as defined on page I-4 have been made.
Dividends
We refer to note 12 to the Historical Financial Information which states that no dividends
have been paid by the Company in respect of the Relevant Periods.
Ernst & Y oung
Certified Public Accountants
Hong Kong
13 March 2025
APPENDIX I ACCOUNTANTS’ REPORT
– I-3 –


--- page 538 ---
I. HISTORICAL FINANCIAL INFORMATION
Preparation of Historical Financial Information
Set out below is the Historical Financial Information which forms an integral part of this
accountants’ report.
The financial statements of the Group for the Relevant Periods, on which the Historical
Financial Information is based, were audited by Ernst & Y oung in accordance with Hong Kong
Standards on Auditing issued by the Hong Kong Institute of Certified Public Accountants (the
“Underlying Financial Statements”).
The Historical Financial Information is presented in Renminbi (“RMB”) and all values
are rounded to the nearest thousand (RMB’000) except when otherwise indicated.
APPENDIX I ACCOUNTANTS’ REPORT
– I-4 –


--- page 539 ---
CONSOLIDATED STATEMENTS OF PROFIT OR LOSS AND OTHER
COMPREHENSIVE INCOME
Y ear ended 31 December
Nine months ended
30 September
Notes 2022 2023 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Other income 5 5,764 11,356 8,809 8,647
Other gains and losses, net 6 77,184 (106,695) (102,433) (388)
Research and development costs (179,546) (57,690) (38,083) (58,907)
Administrative expenses (177,449) (79,944) (64,064) (64,386)
Finance costs 8 (619) (317) (248) (129)
Listing expenses (14,301) (16,280) (12,323) (14,332)
LOSS BEFORE TAX 7 (288,967) (249,570) (208,342) (129,495)
Income tax expense 11 ––––
LOSS FOR THE YEAR/PERIOD (288,967) (249,570) (208,342) (129,495)
Attributable to:
Owners of the Company (288,967) (249,570) (208,342) (129,495)
OTHER COMPREHENSIVE INCOME
Other comprehensive income/(loss) that
may be reclassified to profit or loss
in subsequent periods:
Exchange differences on translation of
the financial statements of
subsidiaries 69 106 (4) (186)
OTHER COMPREHENSIVE
INCOME/(LOSS) FOR THE
YEAR/PERIOD, NET OF TAX 69 106 (4) (186)
TOTAL COMPREHENSIVE LOSS
FOR THE YEAR/PERIOD (288,898) (249,464) (208,346) (129,681)
Attributable to:
Owners of the Company (288,898) (249,464) (208,346) (129,681)
LOSS PER SHARE A TTRIBUTABLE
TO ORDINARY EQUITY HOLDERS
OF THE COMPANY
Basic and diluted 13 N/A N/A N/A N/A
APPENDIX I ACCOUNTANTS’ REPORT
– I-5 –


--- page 540 ---
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
As at 31 December
As at
30 September
Notes 2022 2023 2024
RMB’000 RMB’000 RMB’000
NON-CURRENT ASSETS
Property, plant and equipment 14 2,352 876 371
Right-of-use assets 15 14,812 12,379 11,523
Intangible assets 16 1,415 567 69
Amount advanced to a related party 25 – 39,193 39,193
Prepayments and other receivables 17 11,103 16,660 18,821
Total non-current assets 29,682 69,675 69,977
CURRENT ASSETS
Prepayments and other receivables 17 15,961 16,972 13,818
Amount advanced to a related party 25 69,171 9,367 12,494
Cash and cash equivalents 18 626,458 347,782 242,647
Total current assets 711,590 374,121 268,959
CURRENT LIABILITIES
Trade and other payables 19 49,460 37,582 38,289
Deferred income 2,900 2,900 –
Amounts due to related parties 25 30,311 8,790 8,061
Lease liabilities 15 4,668 2,552 2,389
Total current liabilities 87,339 51,824 48,739
NET CURRENT ASSETS 624,251 322,297 220,220
TOTAL ASSETS LESS CURRENT
LIABILITIES 653,933 391,972 290,197
NON-CURRENT LIABILITIES
Lease liabilities 15 1,328 1,097 599
Total non-current liabilities 1,328 1,097 599
Net assets 652,605 390,875 289,598
EQUITY
Equity attributable to owners of the
Company
Share capital 20 70 70 70
Treasury shares 20 (6) (6) (6)
Reserves 21 652,541 390,811 289,534
Total equity 652,605 390,875 289,598
APPENDIX I ACCOUNTANTS’ REPORT
– I-6 –


--- page 541 ---
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
Share
capital
Treasury
shares
Share
premium*
Share
reward
reserve*
Exchange
fluctuation
reserve*
Accumulated
losses* Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(note 20) (note 20) (note 21)
At 1 January 2022 77 (13) 1,523,253 217,661 (169) (892,814) 847,995
Loss for the year ––––– (288,967) (288,967)
Other comprehensive
income for the year:
Exchange differences
on translation of the
financial statements
of subsidiaries –––– 6 9 – 6 9
Total comprehensive
loss for the year –––– 6 9 (288,967) (288,898)
Cancellation of non-
voting ordinary
shares (note 20) ( 7 ) 7––– ––
Equity-settled share-
based payment – – – 93,508 – – 93,508
At 31 December 2022
and 1 January 2023 70 (6) 1,523,253 311,169 (100) (1,181,781) 652,605
Loss for the year ––––– (249,570) (249,570)
Other comprehensive
income for the year:
Exchange differences
on translation of the
financial statements
of subsidiaries –––– 1 0 6 – 1 0 6
Total comprehensive
loss for the year –––– 1 0 6 (249,570) (249,464)
Equity-settled share-
based payment – – – (12,266) – – (12,266)
At 31 December 2023 70 (6) 1,523,253 298,903 6 (1,431,351) 390,875
APPENDIX I ACCOUNTANTS’ REPORT
– I-7 –


--- page 542 ---
Share
capital
Treasury
shares
Share
premium*
Share
reward
reserve*
Exchange
fluctuation
reserve*
Accumulated
losses* Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(note 20) (note 20) (note 21)
At 1 January 2023 70 (6) 1,523,253 311,169 (100) (1,181,781) 652,605
Loss for the period ––––– (208,342) (208,342)
Other comprehensive
loss for the period:
Exchange differences
on translation of the
financial statements
of subsidiaries –––– ( 4 ) – ( 4 )
Total comprehensive
loss for the period –––– ( 4 ) (208,342) (208,346)
Equity-settled share-
based payment – – – (15,587) – – (15,587)
At 30 September 2023
(unaudited) 70 (6) 1,523,253 295,582 (104) (1,390,123) 428,672
At 1 January 2024 70 (6) 1,523,253 298,903 6 (1,431,351) 390,875
Loss for the period ––––– (129,495) (129,495)
Other comprehensive
loss for the period:
Exchange differences
on translation of the
financial statements
of subsidiaries –––– (186) – (186)
Total comprehensive
loss for the period –––– (186) (129,495) (129,681)
Equity-settled share-
based payment – – – 28,404 – – 28,404
At 30 September 2024 70 (6) 1,523,253 327,307 (180) (1,560,846) 289,598
* These accounts comprise the reserves of RMB652,541,000, RMB390,811,000 and RMB289,534,000 in the
consolidated statements of financial position as at 31 December 2022 and 2023 and 30 September 2024,
respectively.
APPENDIX I ACCOUNTANTS’ REPORT
– I-8 –


--- page 543 ---
CONSOLIDATED STATEMENTS OF CASH FLOWS
Y ear ended
31 December
Nine months ended
30 September
Notes 2022 2023 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
CASH FLOWS FROM OPERA TING
ACTIVITIES
Loss before tax (288,967) (249,570) (208,342) (129,495)
Adjustments for:
Bank interest income 5 (5,567) (11,145) (8,601) (5,554)
Finance costs 8 619 317 248 129
Depreciation of property, plant and
equipment 7 1,741 1,509 1,241 622
Depreciation of right-of-use assets 7 4,933 4,639 3,723 2,593
Amortisation of intangible assets 7 723 848 639 498
Loss on disposal of items of
property,
plant and equipment 7 91 242 242 –
Loss on termination of a lease
contract 15 – 273 273 –
Loss from a discontinued
procurement contract 6 – 69,171 109,006 –
Share-based payment
expenses/(credit) 22 93,508 (12,266) (15,587) 28,404
(192,919) (195,982) (117,158) (102,803)
Increase in prepayments and other
receivables (224) (1,667) (4,610) (733)
Increase in amount advanced to a
related party (69,171) (48,560) (7,300) (3,127)
Increase/(decrease) in amounts due to
related parties and provision for a
discontinued procurement contract 7,147 (21,521) (20,576) (729)
Increase/(decrease) in trade and other
payables 4,442 (12,080) (12,733) 707
Decrease in deferred income – – – (2,900)
Cash used in operations (250,725) (279,810) (162,377) (109,585)
Interest received 4,176 8,500 6,643 7,179
Net cash flows used in operating
activities (246,549) (271,310) (155,734) (102,406)
APPENDIX I ACCOUNTANTS’ REPORT
– I-9 –


--- page 544 ---
Y ear ended
31 December
Nine months ended
30 September
Notes 2022 2023 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
CASH FLOWS FROM INVESTING
ACTIVITIES
Purchases of items of property, plant
and equipment (1,484) (520) (348) (117)
Prepayment for acquisition of land
use right (282) – – –
Net cash flows used in investing
activities (1,766) (520) (348) (117)
CASH FLOWS FROM FINANCING
ACTIVITIES
Lease payments, including related
interest (5,783) (4,945) (3,913) (2,426)
Payment of listing expense (2,166) (2,007) (903) –
Net cash flows used in financing
activities (7,949) (6,952) (4,816) (2,426)
NET DECREASE IN CASH AND
CASH EQUIV ALENTS (256,264) (278,782) (160,898) (104,949)
Effect of foreign exchange rate
changes 69 106 (4) (186)
Cash and cash equivalents at
beginning of year/period 882,653 626,458 626,458 347,782
CASH AND CASH EQUIV ALENTS
A T END OF YEAR/PERIOD 18 626,458 347,782 465,556 242,647
APPENDIX I ACCOUNTANTS’ REPORT
– I-10 –


--- page 545 ---
STATEMENTS OF FINANCIAL POSITION OF THE COMPANY
As at 31 December
As at
30 September
Notes 2022 2023 2024
RMB’000 RMB’000 RMB’000
NON-CURRENT ASSETS
Investments in subsidiaries 1 1,019,940 1,192,898 1,350,002
Total non-current assets 1,019,940 1,192,898 1,350,002
CURRENT ASSETS
Prepayments and other receivables 17 6,935 9,477 5,928
Amount due from a subsidiary 25 659 – –
Cash and cash equivalents 18 440,425 232,841 93,670
Total current assets 448,019 242,318 99,598
CURRENT LIABILITIES
Accruals and other payables 19 8,370 11,267 10,022
Amount due to a related party 25 9,535 – –
Total current liabilities 17,905 11,267 10,022
NET CURRENT ASSETS 430,114 231,051 89,576
Net assets 1,450,054 1,423,949 1,439,578
EQUITY
Share capital 20 70 70 70
Treasury shares 20 (6) (6) (6)
Reserves 21 1,449,990 1,423,885 1,439,514
Total equity 1,450,054 1,423,949 1,439,578
APPENDIX I ACCOUNTANTS’ REPORT
– I-11 –


--- page 546 ---
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION
1. CORPORATE AND GROUP INFORMATION
VISEN Pharmaceuticals (the “Company”) was incorporated in the Cayman Islands as an exempted company
with limited liability on 1 November 2018. The registered office address of the Company is P .O. Box 472, Harbour
Place, 2nd Floor, 103 South Church Street, George Town, Grand Cayman KY1-1106, Cayman Islands.
The Company is an investment holding company. The Company and its subsidiaries (the “Group”) are
principally engaged in developing and commercialising paradigm-shifting endocrine therapies. The address of the
head office of the Company is Suite 3-108, Floor 3, Building B, Hengtai Lixiang Chuangxin Tower, 69 Jiuzhang
Road, Suzhou, China.
As at the date of this report, the Company had direct and indirect interests in its subsidiaries, all of which are
private limited liability companies (or, if incorporated outside Hong Kong, have substantially similar characteristics
to a private company incorporated in Hong Kong), the particulars of which are as follows:
Name
Place and date of
incorporation/
registration and
place of operations
Nominal value of
issued ordinary/
registered share
capital
Percentage of equity
attributable to the
Company Principal activities
Direct Indirect
VISEN Pharmaceuticals
HK Limited (“VISEN
HK”) (note a)
Hong Kong,
13 November 2018
United States
dollars
(“USD”)
148,520,000
100% – Investment holding
VISEN Pharmaceuticals
(BVI) Limited (“VISEN
BVI”) (note b)
British Virgin Islands,
9 November 2020
USD2,050,000 100% – Investment holding
VISEN Pharmaceuticals
(Shanghai) Co., Ltd. *
(“VISEN Shanghai”) ( ၪ
ᖹุ(ɪऎ)ʮ̡)
(note c)
People’s Republic of
China (“PRC”),
Chinese Mainland,
15 February 2019
USD113,000,000 – 100% Developing and
commercialising
paradigm-shifting
endocrine therapies
in China
VISEN Pharmaceuticals
(Suzhou) Co., Ltd. *
(“VISEN Suzhou”) (؁
ᖹุ(ᘽψ)ʮ̡)
(note c)
PRC, Chinese
Mainland, 11 June
2021
USD80,000,000 – 100% Developing and
commercialising
paradigm-shifting
endocrine therapies
in China
VISEN Pharmaceuticals
(Taiwan) Ltd. (“VISEN
Taiwan”) (ᖹุ
ʮ̡) (note d)
Taiwan, 28 December
2021
Taiwan dollars
(“TWD”)
45,000,000
– 100% Developing and
commercialising
paradigm-shifting
endocrine therapies
in Taiwan
Notes:
a. The financial statements of this entity for the years ended 31 December 2022 and 2023 prepared in
accordance with the Small and Medium-sized Entity Financial Reporting Standard issued by the Hong
Kong Institute of Certified Public Accountants were audited by Wong Chi Keung, Dennis, a certified
public accountant registered in Hong Kong.
b. No audited financial statements have been prepared for the entity for the years ended 31 December 2022
and 2023 as this entity was not subject to any statutory audit requirements under the relevant rules and
regulations in its jurisdiction of incorporation.
c. The statutory financial statements of these entities for the years ended 31 December 2022 and 2023
prepared in accordance with Accounting System for Business Enterprises were audited by Ernst &
Y oung Hua Ming LLP Shanghai Branch, certified public accountants registered in the PRC.
APPENDIX I ACCOUNTANTS’ REPORT
– I-12 –


--- page 547 ---
d. The financial statements of this entity for the years ended 31 December 2022 and 2023 prepared in
accordance with the International Financial Reporting Standards were audited by KPMG LLP , certified
public accountants registered in Taiwan.
* The English names of these entities represent the best effort made by the directors of the Company (the
“Directors”) to translate the Chinese names as they have not been registered with any official English
name.
The investments in subsidiaries in the Company’s statements of financial position represent:
As at 31 December
As at
30 September
2022 2023 2024
RMB’000 RMB’000 RMB’000
Unlisted investments, at cost 1,019,940 1,192,898 1,350,002
2.1 BASIS OF PREPARATION
The Historical Financial Information has been prepared in accordance with IFRS Accounting Standards issued
by the International Accounting Standards Board (“IASB”).
All IFRS Accounting Standards effective for the accounting period commencing from 1 January 2024, together
with the relevant transitional provisions, have been early adopted by the Group in the preparation of the Historical
Financial Information throughout the Relevant Periods and in the period covered by the Interim Comparative
Financial Information.
The Historical Financial Information has been prepared under the historical cost convention.
Basis of consolidation
The Historical Financial Information includes the financial information of the Company and its subsidiaries
for the Relevant Periods. A subsidiary is an entity (including a structured entity), directly or indirectly, controlled by
the Company. Control is achieved when the Group is exposed, or has rights, to variable returns from its involvement
with the investee and has the ability to affect those returns through its power over the investee (i.e., existing rights
that give the Group the current ability to direct the relevant activities of the investee).
Generally, there is a presumption that a majority of voting rights results in control. When the Company has
less than a majority of the voting or similar rights of an investee, the Group considers all relevant facts and
circumstances in assessing whether it has power over an investee, including:
(a) the contractual arrangement with the other vote holders of the investee;
(b) rights arising from other contractual arrangements; and
(c) the Group’s voting rights and potential voting rights.
The financial statements of the subsidiaries are prepared for the same reporting period as the Company, using
consistent accounting policies. The results of subsidiaries are consolidated from the date on which the Group obtains
control, and continue to be consolidated until the date that such control ceases.
All intra-group assets and liabilities, equity, income, expenses and cash flows relating to transactions between
members of the Group are eliminated in full on consolidation.
The Group reassesses whether or not it controls an investee if facts and circumstances indicate that there are
changes to one or more of the three elements of control described above. A change in the ownership interest of a
subsidiary, without a loss of control, is accounted for as an equity transaction.
If the Group loses control over a subsidiary, it derecognises the related assets (including goodwill), liabilities,
any non-controlling interest and the exchange fluctuation reserve; and recognises the fair value of any investment
retained and any resulting surplus or deficit in profit or loss. The Group’s share of components previously recognised
in other comprehensive income is reclassified to profit or loss or retained profits, as appropriate, on the same basis
as would be required if the Group had directly disposed of the related assets or liabilities.
APPENDIX I ACCOUNTANTS’ REPORT
– I-13 –


--- page 548 ---
2.2 ISSUED BUT NOT YET EFFECTIVE IFRS ACCOUNTING STANDARDS
The Group has not applied the following new and amended IFRS Accounting Standards, that have been issued
but are not yet effective, in the Historical Financial Information. The Group intends to apply these new and amended
IFRS Accounting Standards, if applicable, when they become effective.
Amendments to IAS 21 Lack of Exchangeability
1
Amendments to IFRS 9 and IFRS 7 Amendments to the Classification and Measurement of Financial
Instruments 2
Amendments to IFRS 9 and IFRS 7 Contracts Referencing Nature-dependent Electricity 2
IFRS 18 Presentation and Disclosure in Financial Statements 3
IFRS 19 Subsidiaries without Public Accountability: Disclosures 3
Amendments to IFRS 10 and IAS 28 Sale or Contribution of Assets between an Investor and its
Associate or Joint V enture 4
1 Effective for annual periods beginning on or after 1 January 2025
2 Effective for annual periods beginning on or after 1 January 2026
3 Effective for annual/reporting periods beginning on or after 1 January 2027
4 No mandatory effective date yet determined but available for adoption
The Group is in the process of making an assessment of the impact of these new and amended IFRS Accounting
Standards upon initial application. IFRS 18 introduce new requirements on presentation within the statement of profit
or loss, including specified totals and subtotals. It also requires disclosure of management-defined performance
measures in a note and includes new requirements for aggregation and disaggregation of financial information. The
new requirements are expected to impact the Group’s presentation in the statement of profit or loss and other
comprehensive income and disclosures of the Group’s financial performance. However, the application of IFRS 18
is not expected to have any impact on the financial position or performance of the Group. Other than IFRS 18, so
far, the Group considers that IFRS 19 and the amended IFRS Accounting Standards are unlikely to have a significant
impact on the Group’s results of operations and financial position.
2.3 MATERIAL ACCOUNTING POLICIES
Impairment of non-financial assets
Where an indication of impairment exists, or when annual impairment testing for a non-financial asset is
required, the asset’s recoverable amount is estimated. An asset’s recoverable amount is the higher of the asset’s or
cash-generating unit’s value in use and its fair value less costs of disposal, and is determined for an individual asset,
unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of
assets, in which case the recoverable amount is determined for the cash-generating unit to which the asset belongs.
An impairment loss is recognised only if the carrying amount of an asset exceeds its recoverable amount. In
assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount
rate that reflects current market assessments of the time value of money and the risks specific to the asset. An
impairment loss is charged to profit or loss in the period in which it arises in those expense categories consistent with
the function of the impaired asset.
An assessment is made at the end of each of the reporting periods as to whether there is an indication that
previously recognised impairment losses may no longer exist or may have decreased. If such an indication exists, the
recoverable amount is estimated. A previously recognised impairment loss of an asset other than goodwill is reversed
only if there has been a change in the estimates used to determine the recoverable amount of that asset, but not to
an amount higher than the carrying amount that would have been determined (net of any depreciation/amortisation)
had no impairment loss been recognised for the asset in prior years. A reversal of such an impairment loss is credited
to profit or loss in the period in which it arises.
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Related parties
A party is considered to be related to the Group if:
(a) the party is a person or a close member of that person’s family and that person
(i) has control or joint control over the Group;
(ii) has significant influence over the Group; or
(iii) is a member of the key management personnel of the Group or of a parent of the Group;
or
(b) the party is an entity where any of the following conditions applies:
(i) the entity and the Group are members of the same group;
(ii) one entity is an associate or joint venture of the other entity (or of a parent, subsidiary or fellow
subsidiary of the other entity);
(iii) the entity and the Group are joint ventures of the same third party;
(iv) one entity is a joint venture of a third entity and the other entity is an associate of the third entity;
(v) the entity is a post-employment benefit plan for the benefit of employees of either the Group or
an entity related to the Group;
(vi) the entity is controlled or jointly controlled by a person identified in (a);
(vii) a person identified in (a)(i) has significant influence over the entity or is a member of the key
management personnel of the entity (or of a parent of the entity); and
(viii) the entity, or any member of a group of which it is a part, provides key management personnel
services to the Group or to the parent of the Group.
Property, plant and equipment and depreciation
Property, plant and equipment, other than construction in progress, are stated at cost less accumulated
depreciation and any impairment losses. The cost of an item of property, plant and equipment comprises its purchase
price and any directly attributable costs of bringing the asset to its working condition and location for its intended
use.
Expenditure incurred after items of property, plant and equipment have been put into operation, such as repairs
and maintenance, is normally charged to profit or loss in the period in which it is incurred. In situations where the
recognition criteria are satisfied, the expenditure for a major inspection is capitalised in the carrying amount of the
asset as a replacement. Where significant parts of property, plant and equipment are required to be replaced at
intervals, the Group recognises such parts as individual assets with specific useful lives and depreciates them
accordingly.
Depreciation is calculated on the straight-line basis to write off the cost of each item of property, plant and
equipment to its residual value over its estimated useful life. The principal annual rates used for this purpose are as
follows:
Furniture and equipment 20% – 67%
Leasehold improvements 48% – 55%
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Where parts of an item of property, plant and equipment have different useful lives, the cost of that item is
allocated on a reasonable basis among the parts and each part is depreciated separately. Residual values, useful lives
and the depreciation method are reviewed, and adjusted if appropriate, at least at the end of each of the reporting
periods.
An item of property, plant and equipment including any significant part initially recognised is derecognised
upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss on disposal
or retirement recognised in profit or loss in the year/period the asset is derecognised is the difference between the
net sales proceeds and the carrying amount of the relevant asset.
Construction in progress is stated at cost less any impairment losses, and is not depreciated. It is reclassified
to the appropriate category of property, plant and equipment when completed and ready for use.
Intangible assets (other than goodwill)
Intangible assets acquired separately are measured on initial recognition at cost. The cost of intangible assets
acquired in a business combination is the fair value at the date of acquisition. The useful lives of intangible assets
are assessed to be either finite or indefinite. Intangible assets with finite lives are subsequently amortised over the
useful economic life and assessed for impairment whenever there is an indication that the intangible asset may be
impaired. The amortisation period and the amortisation method for an intangible asset with a finite useful life are
reviewed at least at the end of each of the reporting periods.
Software is amortised on a straight-line basis over the useful economic lives of 3 to 5 years.
Research and development costs
All research costs are charged to profit or loss as incurred.
Expenditure incurred on projects to develop new products is capitalised and deferred only when the Group can
demonstrate the technical feasibility of completing the intangible asset so that it will be available for use or sale, its
intention to complete and its ability to use or sell the asset, how the asset will generate future economic benefits, the
availability of resources to complete the project and the ability to measure reliably the expenditure during the
development. Product development expenditure which does not meet these criteria is expensed when incurred.
Leases
The Group assesses at contract inception whether a contract is, or contains, a lease. A contract is, or contains,
a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for
consideration.
Group as a lessee
The Group applies a single recognition and measurement approach for all leases, except for short-term leases
and leases of low-value assets. The Group recognises lease liabilities to make lease payments and right-of-use assets
representing the right to use the underlying assets.
(a) Right-of-use assets
Right-of-use assets are recognised at the commencement date of the lease (that is the date the underlying asset
is available for use). Right-of-use assets are measured at cost, less accumulated depreciation and any impairment
losses, and adjusted for any remeasurement of lease liabilities. The cost of right-of-use assets includes the amount
of lease liabilities recognised, initial direct costs incurred, and lease payments made at or before the commencement
date less any lease incentives received. Right-of-use assets are depreciated on a straight-line basis over the shorter
of the lease terms and the estimated useful lives of the assets as follows:
Office premises 2 to 3 years
Land use right 30 years
If ownership of the leased asset transfers to the Group by the end of the lease term or the cost reflects the
exercise of a purchase option, depreciation is calculated using the estimated useful life of the asset.
APPENDIX I ACCOUNTANTS’ REPORT
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(b) Lease liabilities
Lease liabilities are recognised at the commencement date of the lease at the present value of lease payments
to be made over the lease term. The lease payments include fixed payments (including in-substance fixed payments)
less any lease incentives receivable, variable lease payments that depend on an index or a rate, and amounts expected
to be paid under residual value guarantees.
In calculating the present value of lease payments, the Group uses its incremental borrowing rate at the lease
commencement date because the interest rate implicit in the lease is not readily determinable. After the
commencement date, the amount of lease liabilities is increased to reflect the accretion of interest and reduced for
the lease payments made. In addition, the carrying amount of lease liabilities is remeasured if there is a modification,
a change in the lease term, a change in lease payments (e.g., a change to future lease payments resulting from a
change in an index or rate used to determine such lease payments) or a change in assessment of an option to purchase
the underlying asset.
The Group’s lease liabilities are presented in a separate line on the consolidated statements of financial
position.
(c) Short-term leases
The Group applies the short-term lease recognition exemption to its short-term leases of office premises (that
is those leases that have a lease term of 12 months or less from the commencement date and do not contain a purchase
option). Lease payments on short-term leases are recognised as an expense on a straight-line basis over the lease term.
Investments and other financial assets
Initial recognition and measurement
Financial assets are classified, at initial recognition, as subsequently measured at amortised cost, fair value
through other comprehensive income, and fair value through profit or loss.
The classification of financial assets at initial recognition depends on the financial asset’s contractual cash
flow characteristics and the Group’s business model for managing them. With the exception of trade receivables that
do not contain a significant financing component or for which the Group has applied the practical expedient of not
adjusting the effect of a significant financing component, the Group initially measures a financial asset at its fair
value, plus in the case of a financial asset not at fair value through profit or loss, transaction costs.
In order for a financial asset to be classified and measured at amortised cost or fair value through other
comprehensive income, it needs to give rise to cash flows that are solely payments of principal and interest (“SPPI”)
on the principal amount outstanding. Financial assets with cash flows that are not SPPI are classified and measured
at fair value through profit or loss, irrespective of the business model.
The Group’s business model for managing financial assets refers to how it manages its financial assets in order
to generate cash flows. The business model determines whether cash flows will result from collecting contractual
cash flows, selling the financial assets, or both. Financial assets classified and measured at amortised cost are held
within a business model with the objective to hold financial assets in order to collect contractual cash flows, while
financial assets classified and measured at fair value through other comprehensive income are held within a business
model with the objective of both holding to collect contractual cash flows and selling. Financial assets which are not
held within the aforementioned business models are classified and measured at fair value through profit or loss.
Purchases or sales of financial assets that require delivery of assets within the period generally established by
regulation or convention in the marketplace are recognised on the trade date, that is, the date that the Group commits
to purchase or sell the asset.
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 552 ---
Subsequent measurement
The subsequent measurement of financial assets depends on their classification as follows:
Financial assets at amortised cost (debt instruments)
Financial assets at amortised cost are subsequently measured using the effective interest method and are
subject to impairment. Gains and losses are recognised in profit or loss when the asset is derecognised, modified or
impaired.
Derecognition of financial assets
A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets)
is primarily derecognised (i.e., removed from the Group’s consolidated statement of financial position) when:
 the rights to receive cash flows from the asset have expired; or
 the Group has transferred its rights to receive cash flows from the asset or has assumed an obligation
to pay the received cash flows in full without material delay to a third party under a “pass-through”
arrangement; and either (a) the Group has transferred substantially all the risks and rewards of the asset,
or (b) the Group has neither transferred nor retained substantially all the risks and rewards of the asset,
but has transferred control of the asset.
When the Group has transferred its rights to receive cash flows from an asset or has entered into a pass-through
arrangement, it evaluates if, and to what extent, it has retained the risk and rewards of ownership of the asset. When
it has neither transferred nor retained substantially all the risks and rewards of the asset nor transferred control of
the asset, the Group continues to recognise the transferred asset to the extent of the Group’s continuing involvement.
In that case, the Group also recognises an associated liability. The transferred asset and the associated liability are
measured on a basis that reflects the rights and obligations that the Group has retained.
Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower
of the original carrying amount of the asset and the maximum amount of consideration that the Group could be
required to repay.
Impairment of financial assets
The Group recognises an allowance for expected credit losses (“ECLs”) for all debt instruments not held at fair
value through profit or loss. ECLs are based on the difference between the contractual cash flows due in accordance
with the contract and all the cash flows that the Group expects to receive, discounted at an approximation of the
original effective interest rate. The expected cash flows will include cash flows from the sale of collateral held or
other credit enhancements that are integral to the contractual terms.
General approach
ECLs are recognised in two stages. For credit exposures for which there has not been a significant increase
in credit risk since initial recognition, ECLs are provided for credit losses that result from default events that are
possible within the next 12 months (a 12-month ECL). For those credit exposures for which there has been a
significant increase in credit risk since initial recognition, a loss allowance is required for credit losses expected over
the remaining life of the exposure, irrespective of the timing of the default (a lifetime ECL).
At each reporting date, the Group assesses whether the credit risk on a financial instrument has increased
significantly since initial recognition. When making the assessment, the Group compares the risk of a default
occurring on the financial instrument as at the reporting date with the risk of a default occurring on the financial
instrument as at the date of initial recognition and considers reasonable and supportable information that is available
without undue cost or effort, including historical and forward-looking information. The Group considers that there
has been a significant increase in credit risk when contractual payments are more than 30 days past due.
APPENDIX I ACCOUNTANTS’ REPORT
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The Group considers a financial asset in default when contractual payments are 90 days past due. However,
in certain cases, the Group may also consider a financial asset to be in default when internal or external information
indicates that the Group is unlikely to receive the outstanding contractual amounts in full before taking into account
any credit enhancements held by the Group. A financial asset is written off when there is no reasonable expectation
of recovering the contractual cash flows.
Financial assets at amortised cost, except for trade receivables, are subject to impairment under the general
approach and they are classified within the following stages for measurement of ECLs.
Stage 1 – Financial instruments for which credit risk has not increased significantly since initial recognition
and for which the loss allowance is measured at an amount equal to 12-month ECLs
Stage 2 – Financial instruments for which credit risk has increased significantly since initial recognition but
that are not credit-impaired financial assets and for which the loss allowance is measured at an
amount equal to lifetime ECLs
Stage 3 – Financial assets that are credit-impaired at the reporting date (but that are not purchased or
originated credit-impaired) and for which the loss allowance is measured at an amount equal to
lifetime ECLs
Financial liabilities
Initial recognition and measurement
Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit or
loss and financial liabilities at amortised cost, as appropriate.
All financial liabilities are recognised initially at fair value and, in the case of financial liabilities at amortised
cost, net of directly attributable transaction costs.
The Group’s financial liabilities include trade and other payables and amounts due to related parties.
Subsequent measurement
The subsequent measurement of financial liabilities depends on their classification as follows:
Financial liabilities at amortised cost (trade and other payables)
After initial recognition, trade and other payables are subsequently measured at amortised cost, using the
effective interest rate method unless the effect of discounting would be immaterial, in which case they are stated at
cost. Gains and losses are recognised in profit or loss when the liabilities are derecognised as well as through the
effective interest rate amortisation process.
Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs
that are an integral part of the effective interest rate. The effective interest rate amortisation is included in finance
costs in profit or loss.
Derecognition of financial liabilities
A financial liability is derecognised when the obligation under the liability is discharged or cancelled, or
expires.
When an existing financial liability is replaced by another from the same lender on substantially different
terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as
a derecognition of the original liability and a recognition of a new liability, and the difference between the respective
carrying amounts is recognised in profit or loss.
APPENDIX I ACCOUNTANTS’ REPORT
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Offsetting of financial instruments
Financial assets and financial liabilities are offset and the net amount is reported in the statement of financial
position if there is a currently enforceable legal right to offset the recognised amounts and there is an intention to
settle on a net basis, or to realise the assets and settle the liabilities simultaneously.
Treasury shares
Own equity instruments which are reacquired and held by the Company or the Group (treasury shares) are
recognised at cost and deducted from equity. No gain or loss is recognised in profit or loss on the purchase, sale, issue
or cancellation of the Group’s own equity instruments.
Cash and cash equivalents
Cash and cash equivalents in the consolidated statements of financial position comprise cash on hand and at
banks, and short-term highly liquid deposits with a maturity of generally within three months that are readily
convertible into known amounts of cash, subject to an insignificant risk of changes in value and held for the purpose
of meeting short-term cash commitments.
For the purpose of the consolidated statement of cash flows, cash and cash equivalents comprise cash on hand
and at banks, and short-term deposits as defined above, less bank overdrafts which are repayable on demand and form
an integral part of the Group’s cash management.
Provision
A provision is recognised when a present obligation (legal or constructive) has arisen as a result of a past event
and it is probable that a future outflow of resources will be required to settle the obligation, provided that a reliable
estimate can be made of the amount of the obligation.
Income tax
Income tax comprises current and deferred tax. Income tax relating to items recognised outside profit or loss
is recognised outside profit or loss, either in other comprehensive income or directly in equity.
Current tax assets and liabilities are measured at the amount expected to be recovered from or paid to the
taxation authorities, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of
each of the reporting periods, taking into consideration interpretations and practices prevailing in the countries in
which the Group operates.
Deferred tax is provided, using the liability method, on all temporary differences at the end of each of the
reporting periods between the tax bases of assets and liabilities and their carrying amounts for financial reporting
purposes.
Deferred tax liabilities are recognised for all taxable temporary differences, except:
 when the deferred tax liability arises from the initial recognition of goodwill or an asset or liability in
a transaction that is not a business combination and, at the time of the transaction, affects neither the
accounting profit nor taxable profit or loss and does not give rise to equal taxable and deductible
temporary differences; and
 in respect of taxable temporary differences associated with investments in subsidiaries, associates and
joint ventures, when the timing of the reversal of the temporary differences can be controlled and it is
probable that the temporary differences will not reverse in the foreseeable future.
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 555 ---
Deferred tax assets are recognised for all deductible temporary differences, and the carryforward of unused tax
credits and any unused tax losses. Deferred tax assets are recognised to the extent that it is probable that taxable profit
will be available against which the deductible temporary differences, and the carryforward of unused tax credits and
unused tax losses can be utilised, except:
 when the deferred tax asset relating to the deductible temporary differences arises from the initial
recognition of an asset or liability in a transaction that is not a business combination and, at the time
of the transaction, affects neither the accounting profit nor taxable profit or loss and does not give rise
to equal taxable and deductible temporary differences; and
 in respect of deductible temporary differences associated with investments in subsidiaries, associates
and joint ventures, deferred tax assets are only recognised to the extent that it is probable that the
temporary differences will reverse in the foreseeable future and taxable profit will be available against
which the temporary differences can be utilised.
The carrying amount of deferred tax assets is reviewed at the end of each of the reporting periods and reduced
to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the
deferred tax asset to be utilised. Unrecognised deferred tax assets are reassessed at the end of each of the reporting
periods and are recognised to the extent that it has become probable that sufficient taxable profit will be available
to allow all or part of the deferred tax asset to be recovered.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the period when
the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively
enacted by the end of each of the reporting periods.
Deferred tax assets and deferred tax liabilities are offset if and only if the Group has a legally enforceable right
to set off current tax assets and current tax liabilities and the deferred tax assets and deferred tax liabilities relate to
income taxes levied by the same taxation authority on either the same taxable entity or different taxable entities which
intend either to settle current tax liabilities and assets on a net basis, or to realise the assets and settle the liabilities
simultaneously, in each future period in which significant amounts of deferred tax liabilities or assets are expected
to be settled or recovered.
Government grants
Government grants are recognised at their fair value where there is reasonable assurance that the grant will be
received and all attaching conditions will be complied with. When the grant relates to an expense item, it is
recognised as income on a systematic basis over the periods that the costs, for which it is intended to compensate,
are expensed.
Revenue recognition
Other income
Bank interest income is recognised on an accrual basis using the effective interest method by applying the rate
that exactly discounts the estimated future cash receipts over the expected life of the financial instrument or a shorter
period, when appropriate, to the net carrying amount of the financial asset.
Share-based payments
The Company operates an equity incentive plan. Employees (including directors) of the Group receive
remuneration in the form of share-based payments, whereby employees render services in exchange for equity
instruments (“equity-settled transactions”).
The cost of equity-settled transactions with employees is measured by reference to the fair value at the date
at which they are granted. The fair value is determined by an external valuer using the market approach, further
details of which are given in note 22 to the Historical Financial Information.
APPENDIX I ACCOUNTANTS’ REPORT
– I-21 –


--- page 556 ---
The cost of equity-settled transactions is recognised in employee benefit expense, together with a
corresponding increase in equity (in share reward reserve), over the period in which the performance and/or service
conditions are fulfilled. The cumulative expense recognised for equity-settled transactions at the end of each of the
reporting periods until the vesting date reflects the extent to which the vesting period has expired and the Group’s
best estimate of the number of equity instruments that will ultimately vest. The charge or credit to profit or loss for
a period represents the movement in the cumulative expense recognised as at the beginning and end of that period.
Service and non-market performance conditions are not taken into account when determining the grant date
fair value of awards, but the likelihood of the conditions being met is assessed as part of the Group’s best estimate
of the number of equity instruments that will ultimately vest. Non-vesting conditions are reflected in the fair value
of an award and lead to an immediate expensing of an award unless there are also service and/or performance
conditions.
For awards that do not ultimately vest because non-market performance and/or service conditions have not
been met, no expense is recognised. Where awards include a market or non-vesting condition, the transactions are
treated as vesting irrespective of whether the market or non-vesting condition is satisfied, provided that all other
performance and/or service conditions are satisfied.
Where the terms of an equity-settled award are modified, as a minimum an expense is recognised as if the
terms had not been modified, if the original terms of the award are met. In addition, an expense is recognised for any
modification that increases the total fair value of the share-based payments, or is otherwise beneficial to the employee
as measured at the date of modification.
Where an equity-settled award is cancelled, it is treated as if it had vested on the date of cancellation, and any
expense not yet recognised for the award is recognised immediately.
Other employee benefits
Pension scheme
The employees of the Group’s subsidiaries which operate in Chinese Mainland are required to participate in
a central pension scheme operated by the local municipal government. The subsidiaries operating in Chinese
Mainland are required to contribute a certain percentage of their payroll costs to the central pension scheme. The
contributions are charged to profit or loss as they become payable in accordance with the rules of the central pension
scheme.
Housing fund – Chinese Mainland
The Group contributes on a monthly basis to a defined contribution housing fund plan operated by the local
municipal government. Contributions to this plan by the Group are expensed as incurred.
Foreign currencies
The Historical Financial Information is presented in RMB, which is the Company’s functional currency. Each
entity in the Group determines its own functional currency and items included in the financial statements of each
entity are measured using that functional currency. Foreign currency transactions recorded by the entities in the
Group are initially recorded using their respective functional currency rates prevailing at the dates of the transactions.
Monetary assets and liabilities denominated in foreign currencies are translated at the functional currency rates of
exchange ruling at the end of each of the reporting periods. Differences arising on settlement or translation of
monetary items are recognised in profit or loss.
Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the
exchange rates at the dates of the initial transactions. Non-monetary items measured at fair value in a foreign currency
are translated using the exchange rates at the date when the fair value was measured. The gain or loss arising on
translation of a non-monetary item measured at fair value is treated in line with the recognition of the gain or loss
on change in fair value of the item (i.e., translation difference on the item whose fair value gain or loss is recognised
in other comprehensive income or profit or loss is also recognised in other comprehensive income or profit or loss,
respectively).
APPENDIX I ACCOUNTANTS’ REPORT
– I-22 –


--- page 557 ---
In determining the exchange rate on initial recognition of the related asset, expense or income on the
derecognition of a non-monetary asset or non-monetary liability relating to an advance consideration, the date of
initial transaction is the date on which the Group initially recognises the non-monetary asset or non-monetary liability
arising from the advance consideration. If there are multiple payments or receipts in advance, the Group determines
the transaction date for each payment or receipt of the advance consideration.
The functional currencies of certain overseas subsidiaries are currencies other than RMB. As at the end of each
of the reporting periods, the assets and liabilities of these entities are translated into RMB at the exchange rates
prevailing at the end of each of the reporting periods and their statements of profit or loss and other comprehensive
income are translated into RMB at the exchange rates that approximate to those prevailing at the dates of the
transactions.
The resulting exchange differences are recognised in other comprehensive income and accumulated in the
exchange fluctuation reserve, except to the extent that the differences are attributable to non-controlling interests. On
disposal of a foreign operation, the cumulative amount in the reserve relating to that particular foreign operation is
recognised in profit or loss.
For the purpose of the consolidated statement of cash flows, the cash flows of the overseas subsidiaries are
translated into RMB at the exchange rates ruling at the dates of the cash flows. Frequently recurring cash flows of
the overseas subsidiaries which arise throughout the reporting periods are translated into RMB at the weighted
average exchange rates for the reporting periods.
Fair value measurement
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly
transaction between market participants at the measurement date. The fair value measurement is based on the
presumption that the transaction to sell the asset or transfer the liability takes place either in the principal market for
the asset or liability, or in the absence of a principal market, in the most advantageous market for the asset or liability.
The principal or the most advantageous market must be accessible by the Group. The fair value of an asset or a
liability is measured using the assumptions that market participants would use when pricing the asset or liability,
assuming that market participants act in their economic best interest.
A fair value measurement of a non-financial asset takes into account a market participant’s ability to generate
economic benefits by using the asset in its highest and best use or by selling it to another market participant that
would use the asset in its highest and best use.
The Group uses valuation techniques that are appropriate in the circumstances and for which sufficient data
are available to measure fair value, maximising the use of relevant observable inputs and minimising the use of
unobservable inputs.
All assets and liabilities for which fair value is measured or disclosed in the Historical Financial Information
are categorised within the fair value hierarchy, described as follows, based on the lowest level input that is significant
to the fair value measurement as a whole:
Level 1 – based on quoted prices (unadjusted) in active markets for identical assets or liabilities
Level 2 – based on valuation techniques for which the lowest level input that is significant to the fair value
measurement is observable, either directly or indirectly
Level 3 – based on valuation techniques for which the lowest level input that is significant to the fair value
measurement is unobservable
APPENDIX I ACCOUNTANTS’ REPORT
– I-23 –


--- page 558 ---
3. SIGNIFICANT ACCOUNTING JUDGEMENTS AND ESTIMATES
The preparation of the Group’s Historical Financial Information requires management to make judgements,
estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and their
accompanying disclosures, and the disclosure of contingent liabilities. Uncertainty about these assumptions and
estimates could result in outcomes that could require a material adjustment to the carrying amounts of the assets or
liabilities affected in the future.
Estimation uncertainty
The key assumptions concerning the future and other key sources of estimation uncertainty at the end of each
of the reporting periods, that have a significant risk of causing a material adjustment to the carrying amounts of assets
and liabilities within the next financial year, are described below.
Recognition of income taxes and deferred tax assets
Determining income tax provision involves judgment on the future tax treatment of certain transactions and
when certain matters relating to the income taxes have not been confirmed by the local tax bureau. Management
evaluates tax implications of transactions and tax provisions are set up accordingly. The tax treatments of such
transactions are reconsidered periodically to take into account all changes in tax legislation. Deferred tax assets are
recognised in respect of deductible temporary differences and unused tax losses. As those deferred tax assets can only
be recognised to the extent that it is probable that future taxable profits will be available against which the deductible
temporary differences and the losses can be utilised, management’s judgment is required to assess the probability of
future taxable profits. Management’s assessment is revised as necessary and deferred tax assets are recognised if it
becomes probable that future taxable profits will allow the deferred tax asset to be recovered.
Performance-based restricted share units
The Group estimates the number of share awards contingently issuable when determining the share-based
expenses, which depends on the achievement of certain non-market performance targets of the Group under the
Equity Incentive Plan (as defined in note 22 to the Historical Financial Information). This requires an estimation of
the performance targets to be achieved by the Group, including completion of public offering, commercialisation of
products, local manufacturing, total sales and net profit target for the vesting period. The Group recorded
RMB93,508,000, RMB(12,266,000) and RMB28,404,000 share-based payment expenses/(credit) during the years
ended 31 December 2022 and 2023 and the nine months ended 30 September 2024, respectively.
4. OPERATING SEGMENT INFORMATION
Operating segment information
For management purposes, the Group has only one reportable operating segment, which is developing and
commercialising paradigm-shifting endocrine therapies. Since this is the only reportable operating segment of the
Group, no further operating segment analysis thereof is presented.
Geographical information
Since nearly all of the Group’s non-current assets were located in Chinese Mainland, no geographical segment
information in accordance with IFRS 8 Operating Segments is presented.
APPENDIX I ACCOUNTANTS’ REPORT
– I-24 –


--- page 559 ---
5. OTHER INCOME
Y ear ended 31 December
Nine months ended
30 September
2022 2023 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Government grants and other
subsidies related to income (note) 197 211 208 3,093
Bank interest income 5,567 11,145 8,601 5,554
Total 5,764 11,356 8,809 8,647
Note: Government grants have been received from the PRC local government authorities to support a
subsidiary’s operating activities. There are no unfulfilled conditions relating to these government grants.
6. OTHER GAINS AND LOSSES, NET
Y ear ended 31 December
Nine months ended
30 September
2022 2023 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Net foreign exchange gains/(losses) 79,782 4,706 8,547 (120)
Grants (note i) (1,488) (1,407) (1,266) (268)
Donations (note ii) (1,007) (473) (193) –
Loss on disposal of property, plant
and equipment (103) (242) (242) –
Loss on termination of a lease
contract – (273) (273) –
Loss from a discontinued
procurement contract
(Note 25(a)(ii)) – (109,006) (109,006) –
77,184 (106,695) (102,433) (388)
Notes:
i. During the years ended 31 December 2022 and 2023 and the nine months ended 30 September 2023 and
2024, the Group granted RMB1,488,000, RMB1,407,000, RMB1,266,000 and RMB268,000,
respectively, to a national cooperative exchange platform for rare diseases for sponsoring its research
on diagnosis consensus of achondroplasia in the PRC.
ii. During the years ended 31 December 2022 and 2023 and the nine months ended 30 September 2023 and
2024, the Group donated RMB1,007,000, RMB473,000, RMB193,000 and nil, respectively, to
non-profit making organisations for the purpose of epidemic relief and public welfare.
APPENDIX I ACCOUNTANTS’ REPORT
– I-25 –


--- page 560 ---
7. LOSS BEFORE TAX
The Group’s loss before tax is arrived at after charging/(crediting):
Y ear ended 31 December
Nine months ended
30 September
2022 2023 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Depreciation of property, plant and
equipment 1,741 1,509 1,241 622
Depreciation of right-of-use assets 4,933 4,639 3,723 2,593
Amortisation of intangible assets 723 848 639 498
Loss from a discontinued
procurement contract – 109,006 110,361 –
Listing expenses 14,301 16,280 12,323 14,332
Loss on disposal of items of
property, plant and equipment 103 242 242 –
Auditors’ remuneration 180 146 110 52
Short-term lease payments 316 344 258 328
Loss on termination of a lease
contract – 273 273 –
Staff costs (including directors’
emoluments):
– Salaries, discretionary bonuses,
allowances and benefits in kind 86,295 75,200 59,636 46,715
– Pension scheme contributions 5,056 3,704 2,912 2,567
– Share-based payment
expenses/(credit) 93,508 (12,266) (15,587) 28,404
184,859 66,638 46,961 77,686
8. FINANCE COSTS
Y ear ended 31 December
Nine months ended
30 September
2022 2023 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Interest on lease liabilities 619 317 248 129
9. DIRECTORS’ AND CHIEF EXECUTIVE’S REMUNERATION
Mr. LU An-bang and Dr. DONG Dandan were appointed as the executive directors of the Company with effect
from 7 November 2018. Mr. FU Shan and Mr. Jan Møller MIKKELSEN were appointed as the non-executive
directors of the Company with effect from 1 November 2018 and 7 November 2018, respectively. Mr. Michael Wolff
JENSEN and Mr. CAO Yibo were appointed as the non-executive directors of the Company with effect from 8
January 2021. Dr. Y AO Zhengbin, Mr. CHAN Peng Kuan and Ms. NI Hong were appointed as the independent
non-executive directors of the Company with effect from 1 April 2021. Mr. Michael J CHANG was appointed as the
non-executive director of the Company and Dr. DONG Dandan resigned as the executive director with effect from
13 December 2023.
APPENDIX I ACCOUNTANTS’ REPORT
– I-26 –


--- page 561 ---
Directors’ and chief executive’s remuneration for the Relevant Periods, disclosed pursuant to the Listing Rules,
section 383(1)(a), (b), (c) and (f) of the Hong Kong Companies Ordinance and Part 2 of the Companies (Disclosure
of Information about Benefits of Directors) Regulation, is as follows:
Y ear ended 31 December
Nine months ended
30 September
2022 2023 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Fees 1,035 1,080 807 825
Other emoluments:
Salaries, allowances and benefits
in kind 2,496 3,175 2,375 2,535
Discretionary bonuses 1,022 1,052 787 819
Pension scheme contributions – – – 55
Share-based payment expenses 57,921 13,762 11,915 20,480
61,439 17,989 15,077 23,889
62,474 19,069 15,884 24,714
During the Relevant Periods and the nine months ended 30 September 2023, a director was granted with
restricted share units, in respect of his services to the Group, under the equity incentive plan of the Company, further
details of which are set out in note 22 to the Historical Financial Information. The fair value of such restricted share
units, which has been recognised in profit or loss over the vesting period, was determined as at the date of grant and
the amounts included in the Historical Financial Information for the Relevant Periods and the nine months ended 30
September 2023 are included in the above directors’ and chief executive’s remuneration disclosures.
(a) Independent non-executive directors
The fees paid to independent non-executive directors were as follows:
Y ear ended 31 December
Nine months ended
30 September
2022 2023 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Dr. Y AO Zhengbin 345 360 269 275
Mr. CHAN Peng Kuan 345 360 269 275
Ms. NI Hong 345 360 269 275
1,035 1,080 807 825
There were no other emoluments payable to the independent non-executive directors during the Relevant
Periods and the nine months ended 30 September 2023.
APPENDIX I ACCOUNTANTS’ REPORT
– I-27 –


--- page 562 ---
(b) Executive directors, non-executive directors and the chief executive
Salaries,
allowances
and benefits
in kind
Discretionary
bonuses
Share-based
payment
expenses Total
RMB’000 RMB’000 RMB’000 RMB’000
Y ear ended 31 December 2022
Executive directors:
Mr. LU An-bang* 2,496 1,022 57,921 61,439
Dr. DONG Dandan ––––
2,496 1,022 57,921 61,439
Non-executive directors:
Mr. FU Shan ––––
Mr. Jan Møller MIKKELSEN ––––
Mr. Michael Wolff JENSEN ––––
M r . C A O Y i b o ––––
––––
Salaries,
allowances
and benefits
in kind
Discretionary
bonuses
Share-based
payment
expenses Total
RMB’000 RMB’000 RMB’000 RMB’000
Y ear ended 31 December 2023
Executive directors:
Mr. LU An-bang* 3,175 1,052 13,762 17,989
Dr. DONG Dandan ––––
3,175 1,052 13,762 17,989
Non-executive directors:
Mr. FU Shan ––––
Mr. Michael J. CHANG ––––
Mr. Jan Møller MIKKELSEN ––––
Mr. Michael Wolff JENSEN ––––
M r . C A O Y i b o ––––
––––
APPENDIX I ACCOUNTANTS’ REPORT
– I-28 –


--- page 563 ---
Salaries,
allowances
and benefits
in kind
Discretionary
bonuses
Share-based
payment
expenses Total
RMB’000 RMB’000 RMB’000 RMB’000
Nine months ended
30 September 2023 (unaudited)
Executive directors:
Mr. LU An-bang* 2,375 787 11,915 15,077
Dr. DONG Dandan ––––
2,375 787 11,915 15,077
Non-executive directors:
Mr. FU Shan ––––
Mr. Jan Møller MIKKELSEN ––––
Mr. Michael Wolff JENSEN ––––
M r . C A O Y i b o ––––
––––
Salaries,
allowances
and benefits
in kind
Discretionary
bonuses
Pension
scheme
contributions
Share-based
payment
expenses Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Nine months ended
30 September 2024
Executive director:
Mr. LU An-bang* 2,535 819 55 20,480 23,889
Non-executive directors:
Mr. FU Shan –––– –
Mr. Michael J. CHANG –––– –
Mr. Jan Møller
MIKKELSEN –––– –
Mr. Michael Wolff
JENSEN –––– –
M r . C A O Y i b o –––– –
–––– –
There was no arrangement under which a director waived or agreed to waive any remuneration during the
Relevant Periods and the nine months ended 30 September 2023.
* Mr. LU An-bang is also the chief executive of the Company, and his remuneration disclosed above
included the services rendered by him as the chief executive.
APPENDIX I ACCOUNTANTS’ REPORT
– I-29 –


--- page 564 ---
10. FIVE HIGHEST PAID EMPLOYEES
The five highest paid employees during the Relevant Periods included one director who is also the chief
executive, details of whose remuneration are set out in note 9 above. Details of the remuneration of the remaining
four highest paid employees who are neither a director nor chief executive of the Company are as follows:
Y ear ended 31 December
Nine months ended
30 September
2022 2023 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Salaries, allowances and benefits in
kind 7,786 7,771 5,810 6,112
Discretionary bonuses 4,300 4,272 3,181 3,278
Pension scheme contributions 145 146 112 167
Share-based payment expenses 23,603 8,426 6,528 6,129
35,834 20,615 15,631 15,686
The number of non-director and non-chief executive highest paid employees whose remuneration fell within
the following bands is as follows:
Y ear ended 31 December
Nine months ended
30 September
2022 2023 2023 2024
No. of
employees
No. of
employees
No. of
employees
No. of
employees
(Unaudited)
HKD1,500,001 to HKD2,000,000 ––11
HKD2,000,001 to HKD2,500,000 ––11
HKD2,500,001 to HKD3,000,000 –1––
HKD3,000,001 to HKD3,500,000 11––
HKD3,500,001 to HKD4,000,000 ––11
HKD4,500,001 to HKD5,000,000 11––
HKD9,000,001 to HKD9,500,000 ––11
HKD12,000,001 to HKD12,500,000 –1––
HKD14,000,001 to HKD14,500,000 1–––
HKD19,000,001 to HKD19,500,000 1–––
4444
During the Relevant Periods and the nine months ended 30 September 2023, restricted share units were granted
to the non-director and non-chief executive highest paid employees in respect of their services to the Group, further
details of which are included in the disclosures in note 22 to the Historical Financial Information. The fair value of
such restricted share units, which has been recognised in profit or loss over the vesting period, was determined as
at the date of grant and the amounts included in the Historical Financial Information for the Relevant Periods and
the nine months ended 30 September 2023 are included in the above non-director and non-chief executive highest
paid employees’ remuneration disclosures.
During the Relevant Periods and the nine months ended 30 September 2023, no highest paid employees waived
or agreed to waive any remuneration and no remuneration was paid by the Group to any of the five highest paid
employees as an inducement to join or upon joining the Group or as compensation for loss of office.
APPENDIX I ACCOUNTANTS’ REPORT
– I-30 –


--- page 565 ---
11. INCOME TAX
The Group is subject to income tax on an entity basis on profits arising in or derived from the jurisdictions
in which members of the Group are domiciled and operate.
Cayman Islands
Under the current laws of the Cayman Islands, the Company is not subject to tax on income or capital gains.
In addition, upon payments of dividends by the Company to its shareholders, no Cayman Islands withholding tax is
imposed on the Company.
British Virgin Islands
Under the current laws of the British Virgin Islands (“BVI”), the subsidiary incorporated in the BVI is not
subject to tax on income or capital gains. In addition, upon payments of dividends to its shareholder, no BVI
withholding tax is imposed on the subsidiary.
Hong Kong
The subsidiary incorporated in Hong Kong is subject to Hong Kong profits tax at the statutory rate of 16.5%
on any estimated assessable profits arising in Hong Kong during the Relevant Periods. No Hong Kong profits tax was
provided for as the Group did not generate any assessable profits arising in Hong Kong during the Relevant Periods
and the nine months ended 30 September 2023.
Chinese Mainland
Pursuant to the Corporate Income Tax Law of the People’s Republic of China and the respective regulations
(the “CIT Law”), the subsidiaries which operate in Chinese Mainland are subject to CIT at a rate of 25% on the
taxable income during the Relevant Periods and the nine months ended 30 September 2023.
Pursuant to the relevant CIT Laws, VISEN Shanghai enjoyed super deduction of 175% on qualifying research
and development expenditures during the period from January 2022 to October 2022, and enjoyed super deduction
of 200% on qualifying research and development expenditures during the period from November 2022 to September
2024.
Taiwan
The subsidiary incorporated in Taiwan is subject to Taiwan profits tax. The first TWD120,000 of assessable
profits of this subsidiary are not subject to tax and the remaining assessable profits are taxed at 20%. No Taiwan
profits tax was provided for as the Group did not generate any assessable profits arising in Taiwan during the
Relevant Periods and the nine months ended 30 September 2023.
A reconciliation of the tax expense applicable to loss before tax at the statutory rate for the country
(or jurisdictions) in which the Company and its major subsidiaries are domiciled to the tax expense at the effective
tax rate is as follows:
Y ear ended 31 December
Nine months ended
30 September
2022 2023 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Loss before tax (288,967) (249,570) (208,342) (129,495)
Tax at the statutory tax rate (25%) (72,242) (62,393) (52,086) (32,374)
Lower tax rate enacted by local
authority (6,195) 13,177 11,806 3,582
Tax effect of expenses not
deductible for tax purposes 27,631 15,665 14,796 7,275
Income not subject to tax (895) (238) (271) (126)
APPENDIX I ACCOUNTANTS’ REPORT
– I-31 –


--- page 566 ---
Y ear ended 31 December
Nine months ended
30 September
2022 2023 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Additional deductible allowance for
research and development
expenses (16,990) (16,960) (12,745) (12,320)
Tax effect of tax losses and
deductible temporary differences
not recognised 68,691 50,749 38,500 33,963
Tax charge at the Group’s effective
rate ––––
The Group had tax losses in Chinese Mainland of RMB528,003,000 and RMB725,072,000 in aggregate as at
31 December 2022 and 2023, respectively, and RMB857,631,000 in aggregate as at 30 September 2024, that will
expire in one to five years for offsetting against future taxable profits of the company in which the losses arose.
Deferred tax assets have not been recognised in respect of tax losses and deductible temporary differences as
they have arisen in the subsidiaries that have been loss-making for some time and it is not considered probable that
taxable profits in foreseeable future will be available against which the tax losses and deductible temporary
differences can be utilised.
Since the Group did not fall within the scope of the Pillar Two model rules, the Pillar Two model rules did not
have any impact to the Group during the Relevant Periods and the nine months ended 30 September 2023.
12. DIVIDENDS
No dividend was paid or declared by the Company during the Relevant Periods and the nine months ended
30 September 2023.
13. LOSS PER SHARE ATTRIBUTABLE TO ORDINARY EQUITY HOLDERS OF THE COMPANY
No loss per share information is presented as its inclusion, for the purpose of this report, is not considered
meaningful.
APPENDIX I ACCOUNTANTS’ REPORT
– I-32 –


--- page 567 ---
14. PROPERTY, PLANT AND EQUIPMENT
Furniture and
equipment
Leasehold
improvements Total
RMB’000 RMB’000 RMB’000
As at 31 December 2022
At 1 January 2022:
Cost 1,320 3,659 4,979
Accumulated depreciation (398) (788) (1,186)
Net carrying amount 922 2,871 3,793
At 1 January 2022, net of accumulated
depreciation 922 2,871 3,793
Additions 391 – 391
Disposal (91) – (91)
Depreciation provided during the year (474) (1,267) (1,741)
At 31 December 2022, net of accumulated
depreciation 748 1,604 2,352
At 31 December 2022:
Cost 1,585 3,659 5,244
Accumulated depreciation (837) (2,055) (2,892)
Net carrying amount 748 1,604 2,352
Furniture and
equipment
Leasehold
improvements Total
RMB’000 RMB’000 RMB’000
As at 31 December 2023
At 1 January 2023:
Cost 1,585 3,659 5,244
Accumulated depreciation (837) (2,055) (2,892)
Net carrying amount 748 1,604 2,352
At 1 January 2023, net of accumulated
depreciation 748 1,604 2,352
Additions 69 206 275
Disposal (14) (228) (242)
Depreciation provided during the year (439) (1,070) (1,509)
At 31 December 2023, net of accumulated
depreciation 364 512 876
At 31 December 2023:
Cost 1,529 1,756 3,285
Accumulated depreciation (1,165) (1,244) (2,409)
Net carrying amount 364 512 876
APPENDIX I ACCOUNTANTS’ REPORT
– I-33 –


--- page 568 ---
Furniture and
equipment
Leasehold
improvements Total
RMB’000 RMB’000 RMB’000
As at 30 September 2024
At 1 January 2024:
Cost 1,529 1,756 3,285
Accumulated depreciation (1,165) (1,244) (2,409)
Net carrying amount 364 512 876
At 1 January 2024, net of accumulated
depreciation 364 512 876
Additions 41 76 117
Depreciation provided during the period (200) (422) (622)
At 30 September 2024, net of accumulated
depreciation 205 166 371
At 30 September 2024:
Cost 1,557 281 1,838
Accumulated depreciation (1,352) (115) (1,467)
Net carrying amount 205 166 371
As at 31 December 2022 and 2023 and 30 September 2024, there were no pledged property, plant and
equipment.
15. LEASES
The Group as a lessee
The Group has lease contracts for land use right and various items of office premises used in its operations.
Land use right has a term for usage of about 30 years and leases of office premises generally have lease terms between
2 and 3 years. Generally, the Group is restricted from assigning and subleasing the leased assets outside the Group.
(a) Right-of-use assets
The carrying amount of the Group’s right-of-use assets and the movements during the Relevant Periods are as
follows:
Land
use right
Office
premises Total
RMB’000 RMB’000 RMB’000
As at 31 December 2022
As at 1 January 2022 – 10,223 10,223
Addition 9,522 – 9,522
Depreciation charge (317) (4,616) (4,933)
As at 31 December 2022 9,205 5,607 14,812
APPENDIX I ACCOUNTANTS’ REPORT
– I-34 –


--- page 569 ---
Land
use right
Office
premises Total
RMB’000 RMB’000 RMB’000
As at 31 December 2023
As at 1 January 2023 9,205 5,607 14,812
Addition – 3,070 3,070
Termination of a lease contract – (864) (864)
Depreciation charge (318) (4,321) (4,639)
As at 31 December 2023 8,887 3,492 12,379
Land
use right
Office
premises Total
RMB’000 RMB’000 RMB’000
As at 30 September 2024
As at 1 January 2024 8,887 3,492 12,379
Addition – 1,737 1,737
Depreciation charge (238) (2,355) (2,593)
As at 30 September 2024 8,649 2,874 11,523
On 2 November 2023, the Group exercised the termination right in the land use right transfer agreement and
submitted an application of land return (the “Application”). As of 30 September 2024 and up to the date of this report,
the Application is still under ordinary review process by relevant governmental authority.
(b) Lease liabilities
The carrying amount of lease liabilities and the movements during the Relevant Periods are as follows:
As at 31 December
As at
30 September
2022 2023 2024
RMB’000 RMB’000 RMB’000
Carrying amount at 1 January 11,160 5,996 3,649
New leases – 2,872 1,636
Termination of a lease contract – (591) –
Accretion of interest recognised during the
year/period 619 317 129
Payments (5,783) (4,945) (2,426)
Carrying amount at 31 December and
30 September 5,996 3,649 2,988
Analysed into:
Current portion 4,668 2,552 2,389
Non-current portion 1,328 1,097 599
The maturity analysis of lease liabilities is disclosed in note 28 to the Historical Financial Information.
APPENDIX I ACCOUNTANTS’ REPORT
– I-35 –


--- page 570 ---
(c) The amounts recognised in profit or loss in relation to leases are as follows:
Y ear ended 31 December
Nine months ended
30 September
2022 2023 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Depreciation of right-of-use assets 4,933 4,639 3,723 2,593
Interest on lease liabilities 619 317 248 129
Expenses relating to short-term
leases 316 344 258 328
Loss on termination of a lease
contract – 273 273 –
Total amount recognised in profit or
loss 5,868 5,573 4,502 3,050
(d) The total cash outflow for leases is disclosed in note 23(c) to the Historical Financial Information.
16. INTANGIBLE ASSETS
Software
RMB’000
As at 31 December 2022
At 1 January 2022
Cost 2,583
Accumulated amortisation (445)
Net carrying amount 2,138
At 1 January 2022, net of accumulated amortisation 2,138
Amortisation provided during the year (723)
At 31 December 2022, net of accumulated amortisation 1,415
At 31 December 2022
Cost 2,693
Accumulated amortisation (1,278)
Net carrying amount 1,415
As at 31 December 2023
At 1 January 2023
Cost 2,693
Accumulated amortisation (1,278)
Net carrying amount 1,415
At 1 January 2023, net of accumulated amortisation 1,415
Amortisation provided during the year (848)
At 31 December 2023, net of accumulated amortisation 567
APPENDIX I ACCOUNTANTS’ REPORT
– I-36 –


--- page 571 ---
Software
RMB’000
At 31 December 2023
Cost 2,693
Accumulated amortisation (2,126)
Net carrying amount 567
As at 30 September 2024
At 1 January 2024
Cost 2,693
Accumulated amortisation (2,126)
Net carrying amount 567
At 1 January 2024, net of accumulated amortisation 567
Amortisation provided during the period (498)
At 30 September 2024, net of accumulated amortisation 69
At 30 September 2024
Cost 2,693
Accumulated amortisation (2,624)
Net carrying amount 69
17. PREPAYMENTS AND OTHER RECEIV ABLES
The Group
As at 31 December
As at
30 September
2022 2023 2024
RMB’000 RMB’000 RMB’000
Non-current:
V alue-added tax recoverable 9,440 16,137 18,513
Rental deposits 1,663 523 308
11,103 16,660 18,821
Current:
Prepayments for research and development
services 6,951 5,308 5,783
Deferred share issue costs 5,669 6,053 4,518
Other prepayments 1,855 824 528
Bank interest receivable 1,391 4,036 2,410
Other receivables 54 54 54
Rental deposits 41 697 525
15,961 16,972 13,818
APPENDIX I ACCOUNTANTS’ REPORT
– I-37 –


--- page 572 ---
The Company
As at 31 December
As at
30 September
2022 2023 2024
RMB’000 RMB’000 RMB’000
Current:
Deferred share issue costs 5,669 6,053 4,518
Bank interest receivable 1,083 3,286 1,280
Prepayments 181 136 128
Rental deposit 2 2 2
6,935 9,477 5,928
The financial assets included in the above balances relate to receivables for which there were no recent history
of default and past due amounts. In addition, there is no significant change in the economic factors based on the
assessment of the forward-looking information, so the directors of the Company are of the opinion that the ECLs in
respect of these balances are minimal. The balances are interest-free and are not secured with collateral.
18. CASH AND CASH EQUIV ALENTS
The Group
As at 31 December
As at
30 September
2022 2023 2024
RMB’000 RMB’000 RMB’000
Cash and bank balances 626,458 347,782 242,647
Denominated in
RMB 296,809 190,035 153,445
USD 322,940 153,065 84,712
TWD 6,465 4,230 2,509
Hong Kong dollar (“HKD”) 244 452 1,981
626,458 347,782 242,647
The Company
As at 31 December
As at
30 September
2022 2023 2024
RMB’000 RMB’000 RMB’000
Cash and bank balances 440,425 232,841 93,670
Denominated in
RMB 146,648 148,081 20,560
USD 293,777 84,760 73,110
440,425 232,841 93,670
APPENDIX I ACCOUNTANTS’ REPORT
– I-38 –


--- page 573 ---
The RMB is not freely convertible into other currencies, however, under Chinese Mainland’s Foreign
Exchange Control Regulations and Administration of Settlement, Sale and Payment of Foreign Exchange
Regulations, the Group is permitted to exchange RMB for other currencies through banks authorised to conduct
foreign exchange business.
Cash at banks earns interest at floating rates based on daily bank deposit rates. Short term time deposits are
made for varying periods of between one day and three months depending on the immediate cash requirements of the
Group, and earn interest at the respective short term time deposit rates. The bank balances are deposited with
creditworthy banks with no recent history of default.
19. TRADE AND OTHER PAYABLES
The Group
As at 31 December
As at
30 September
2022 2023 2024
RMB’000 RMB’000 RMB’000
Trade payables 3,740 669 2,683
Accrued expenses for research and development
services 8,790 8,078 8,016
Salary and discretionary bonus payables 11,815 13,316 12,819
Other payables 14,582 2,590 4,267
Accrued listing expenses 7,964 11,077 9,832
Other taxes payable 2,569 1,852 672
49,460 37,582 38,289
The Company
As at 31 December
As at
30 September
2022 2023 2024
RMB’000 RMB’000 RMB’000
Accrued listing expenses 7,964 11,077 9,832
Other payables 406 190 190
8,370 11,267 10,022
An ageing analysis of the trade payables and trade payables to related parties as at the end of each of the
Relevant Periods, based on the invoice date, is as follows:
The Group
As at 31 December
As at
30 September
2022 2023 2024
RMB’000 RMB’000 RMB’000
Trade payables
Within 3 months 3,740 669 2,683
Trade payables to a related party (Notes 25(b))
Within 3 months 24,241 339 3,599
APPENDIX I ACCOUNTANTS’ REPORT
– I-39 –


--- page 574 ---
The Company
As at 31 December
As at
30 September
2022 2023 2024
RMB’000 RMB’000 RMB’000
Trade payables to a related party (Notes 25(b))
Within 3 months 9,535 – –
Trade and other payables are unsecured and non-interest-bearing. The carrying amounts of financial liabilities
included in trade and other payables as at the end of each of the Relevant Periods approximated to their fair values
due to their short-term maturities.
20. SHARE CAPITAL AND TREASURY SHARES
The Company was incorporated on 1 November 2018 with authorised share capital of USD50,000 divided into
500,000,000 ordinary shares with a par value of USD0.0001 each.
On 7 November 2018, the authorised share capital of the Company was changed to USD50,000 divided into:
(i) 420,000,000 ordinary shares, and (ii) 80,000,000 Series A Preferred Shares, with a par value of USD0.0001 each.
On 8 January 2021, the authorised share capital of the Company was changed to USD50,000 divided into: (i)
386,363,636 ordinary shares, (ii) 20,000,000 non-voting ordinary shares, (iii) 80,000,000 Series A Preferred Shares,
and (iv) 13,636,364 Series B Preferred Shares, with a par value of US$0.0001 each.
On 16 November 2022, the authorised share capital of the Company was changed to USD50,000 divided into:
(i) 397,023,136 ordinary shares, (ii) 8,905,500 non-voting ordinary shares, (iii) 80,000,000 Series A Preferred Shares,
and (iv) 13,636,364 Series B Preferred Shares, with a par value of US$0.0001 each.
Issued and fully paid:
As at 31 December 2022 and 2023, 1 January 2024
and 30 September 2024
Number of
shares in issue Share capital
USD’000 RMB’000
Non-voting ordinary shares of USD0.0001 each 9,340,500 1 6
Series A Preferred Shares of USD0.0001 each 80,000,000 8 55
Series B Preferred Shares of USD0.0001 each 13,636,364 1 9
102,976,864 10 70
A summary of movements in the Company’s share capital during the Relevant Periods is as follows:
Number of shares
in issue Share capital
RMB’000
As at 1 January 2022 113,636,364 77
Cancellation of non-voting ordinary shares* (10,659,500) (7)
As at 31 December 2022, 1 January 2023, 31 December 2023,
1 January 2024 and 30 September 2024 102,976,864 70
APPENDIX I ACCOUNTANTS’ REPORT
– I-40 –


--- page 575 ---
Treasury shares:
Number of shares Treasury shares
RMB’000
As at 1 January 2022 20,000,000 13
Cancellation of non-voting ordinary shares* (10,659,500) (7)
As at 31 December 2022, 1 January 2023, 31 December 2023,
1 January 2024 and 30 September 2024 9,340,500 6
* On 15 November 2022, the Company entered into share surrender agreements with VP EIP US
LIMITED and VP EIP NUS LIMITED, pursuant to which these two entities surrendered for no
consideration of totalling 10,659,500 non-voting ordinary shares of the Company. The surrendered
shares were reserved for Equity Incentive Plan as set out in note 22 to the Historical Financial
Information and had not been granted to any eligible award recipient before surrender. 10,659,500
non-voting ordinary shares of the Company were cancelled accordingly on 16 November 2022.
Preferred shares
On 7 November 2018, the Company issued 80,000,000 Series A convertible preferred shares (“Series A
Preferred Shares”) to the investors of the Company at a price of USD1.00 per share with a par value of USD0.0001
each. The difference between the issue price and the par value of the shares issued amounting to USD79,992,000
(equivalent to RMB552,465,000) was recognised as share premium.
On 8 January 2021, the Company issued 13,636,364 series B convertible preferred shares (“Series B Preferred
Shares”) to the series B investors of the Company at a price of USD11.00 per share with a par value of USD0.0001
each. The difference between the issue price and the par value of the shares issued amounting to USD149,998,640
(equivalent to RMB970,788,000) was recognised as share premium.
Series A Preferred Shares and Series B Preferred Shares (“Preferred Shares”) are accounted for as equity. The
details of Series A Preferred Shares and Series B Preferred Shares are set out as follows:
Conversion features
Each holder of Preferred Shares shall have the right, at such holder’s sole discretion, at any time after the date
of issuance, to convert Preferred Shares into such number of fully paid ordinary shares as determined by dividing the
relevant issue price by the then-effective conversion price. The conversion prices for Preferred Shares are initially
the respective Preferred Shares subscription price, resulting in an initial conversion ratio of 1:1, and shall be subject
to adjustments to reflect share dividends, share splits, recapitalisation and other value adjustment events.
Each of the Preferred Shares shall automatically be converted into ordinary shares upon the closing of a
firm-commitment underwritten initial public offering by the Company of its ordinary shares or a reverse merger of
the Company with a listed company, on a reputable securities exchange for a minimum offering price as required by
shareholders.
Liquidation preferences
In the event of any liquidation, dissolution or winding up of the Company, either voluntary or involuntary or
the consummation of a Deemed Liquidation Event (as defined below), all assets and funds of the Company legally
available for distribution to the shareholders of the Company (after satisfaction of all creditors’ claims and claims
that may be preferred by law) shall be distributed to the holders of Preferred Shares with an amount equal to the
greater of (i) one times the applicable Preferred Share issue price, plus all declared but unpaid dividends thereon, and
(ii) such amount per share as would have been payable had all Preferred Shares been converted into ordinary shares
immediately prior to such liquidation, dissolution, winding up or Deemed Liquidation Event (“Preference Amount”).
If there are any assets or funds remaining after the aggregate Preferred Shares have been distributed or paid
fully, the remaining assets and funds of the Company legally available for distribution shall be distributed among all
holders of the ordinary shares and the non-voting ordinary shares, in proportion to the number of ordinary shares held
by such holders (assuming the conversion of all non-voting ordinary shares into ordinary shares).
APPENDIX I ACCOUNTANTS’ REPORT
– I-41 –


--- page 576 ---
The following events (each a “Deemed Liquidation Event”) shall be deemed a liquidation, dissolution or
winding up of the Company unless the holders of (i) at least sixty percent of the outstanding Series A Preferred Shares
and (ii) at least fifty percent of the outstanding Series B Preferred Shares elect otherwise, (i) any acquisition, sale
of shares, merger, consolidation or other similar transaction involving any subsidiary in which its shareholders do not
retain a majority of the voting power in the surviving entity or the parent of the surviving entity (except any
transaction effected solely to change the subsidiary’s domicile); or (ii) any sale, lease, transfer, exclusive license or
disposition by the Company or any subsidiary of all or substantially all the assets or intellectual property of the
subsidiaries, taken as a whole.
Based on the details of Preferred Shares set out above, the Preferred Shares include no contractual obligation:
(i) to deliver a variable number of its own equity instruments; or (ii) to deliver cash or another financial asset to the
holders of Preferred Shares ; or (iii) to exchange financial assets or financial liabilities with the holders of Preferred
Shares under conditions that are potentially unfavourable to the Company. Accordingly, the Preferred Shares are
recognised as equity.
21. RESERVES
The Group
The amounts of the Group’s reserves and the movements therein attributable to owners of the Company
are presented in the consolidated statements of changes in equity on pages I-7 to I-8 of the Historical Financial
Information.
Share premium
The share premium of the Group represents the difference between the issue price of convertible
preferred shares and the par value of the shares issued. The Company can allot and issue shares by capitalising
from the amount standing to the credit of the share premium account of the Company.
The Company
Reserves
Share
premium
Share reward
reserve
Accumulated
losses Total
RMB’000 RMB’000 RMB’000 RMB’000
At 1 January 2022 1,523,253 217,661 (409,531) 1,331,383
Profit and total comprehensive
income for the year – – 25,099 25,099
Equity-settled share-based payment – 93,508 – 93,508
At 31 December 2022 and
1 January 2023 1,523,253 311,169 (384,432) 1,449,990
Loss and total comprehensive loss
for the year – – (13,839) (13,839)
Equity-settled share-based payment – (12,266) – (12,266)
At 31 December 2023 and
1 January 2024 1,523,253 298,903 (398,271) 1,423,885
Loss and total comprehensive loss
for the period – – (12,775) (12,775)
Equity-settled share-based payment – 28,404 – 28,404
At 30 September 2024 1,523,253 327,307 (411,046) 1,439,514
APPENDIX I ACCOUNTANTS’ REPORT
– I-42 –


--- page 577 ---
22. SHARE-BASED PAYMENTS
The Company adopted an equity incentive plan (the “Equity Incentive Plan”) on 29 April 2019, as amended
and restated by the Company on 8 January 2021 and 10 March 2021, respectively, for the purpose of providing
incentives and rewards to eligible participants who contribute to the success of the Group. Eligible participants of
the Equity Incentive Plan may include any officer, directors, employees of the Company, and any individual
consultants or advisors who render or have rendered bona fide services to the Company. The Equity Incentive Plan
will automatically terminate on 28 April 2029.
In March 2021, the Company allotted and issued a total of 20,000,000 non-voting ordinary shares of the
Company under the Equity Incentive Plan to certain special purpose vehicles in order to facilitate the administration
of the plan. Details of the issuance of new shares of the Company related to the Equity Incentive Plan are set out in
the section headed “History, Development and Corporate Structure” in the Prospectus. On 15 March 2021, 30 August
2021, and 17 March 2022, the Company has granted restricted share units to 45, 5, and 11 grantees to subscribe for
an aggregate of 6,340,000, 1,180,000, and 340,000 shares under the Equity Incentive Plan, respectively. These
granted restricted share units will be vested in accordance with certain service conditions and non-market
performance conditions. The subscription price for the restricted share units are all nil.
The restricted share units granted to grantees shall vest and become exercisable as to 25% of the total number
of restricted share units granted on the first anniversary of the vesting commencement date, and the remaining 25%,
25% and 25% of the total number of the restricted share units granted shall vest and become exercisable on the
second, third and fourth anniversaries of the vesting commencement date.
In addition to time-based vesting condition, the number of restricted share units which shall vest also depends
on the performance targets, including completion of public offering, commercialisation of products, local
manufacturing, total sales and net profit target achieved by the Group during the vesting period.
The following restricted share units were outstanding under the Equity Incentive Plan during the years ended
31 December 2022 and 2023 and the nine months ended 30 September 2024:
Number of
restricted
share units
As at 1 January 2022 7,340,000
Granted during the year 340,000
Forfeited during the year (37,500)
As at 31 December 2022 and 1 January 2023 7,642,500
Forfeited during the year (1,167,500)
As at 31 December 2023, 1 January 2024 and 30 September 2024 6,475,000
The fair value of the restricted share units granted on 30 August 2021 and 17 March 2022 is determined using
the market approach – the multiple method which is price over research and development expense (“P/RD”). The
following table lists the inputs to the method used:
Restricted share
units granted on
17 March 2022
Fair value at grant date (USD per share) 10.80
P/RD ratio 18.34
Expected volatility 48.61%
Risk-free interest rate 2.13%
Discount for lack of marketability 5.5%-21.0%
During the year ended 31 December 2022 and the nine months ended 30 September 2024, share-based payment
expenses of RMB93,508,000 and RMB28,404,000 were charged to profit or loss, respectively. During the year ended
31 December 2023, share-based payment expenses of RMB12,266,000 were credited to profit or loss mainly due to
forfeiture of 1,167,500 restricted share units for retired and resigned employees.
APPENDIX I ACCOUNTANTS’ REPORT
– I-43 –


--- page 578 ---
23. NOTES TO THE CONSOLIDATED STATEMENTS OF CASH FLOWS
(a) Major non-cash transactions
During the years ended 31 December 2022 and 2023, and the nine months ended 30 September 2024, other
payables related to the purchase of property, plant and equipment were RMB245,000, nil and nil, respectively, which
were non-cash transactions.
During the years ended 31 December 2022 and 2023 and the nine months ended 30 September 2024, the Group
had non-cash additions to right-of-use assets of nil, RMB2,872,000 and RMB1,636,000, respectively, and non-cash
additions to lease liabilities of nil, RMB2,872,000 and RMB1,636,000, respectively, in respect of lease arrangements
for office premises.
(b) Changes in liabilities arising from financing activities
Accrued listing
expense included
in other payables Lease liabilities
RMB’000 RMB’000
At 1 January 2022 4,125 11,160
Changes from financing cash flows (2,166) (5,783)
Changes from operating cash flows (11,404) –
Accrued listing expenses 14,301 –
Deferred share issue costs 3,108 –
Accretion of interest – 619
At 31 December 2022 and 1 January 2023 7,964 5,996
Changes from financing cash flows (2,007) (4,945)
Changes from operating cash flows (11,544) –
Termination of a lease contract – (591)
Accrued listing expenses 16,280 –
Deferred share issue costs 384 –
Accretion of interest – 317
New Leases – 2,872
At 31 December 2023 and 1 January 2024 11,077 3,649
Changes from financing cash flows – (2,426)
Changes from operating cash flows (14,042) –
Accrued listing expenses 14,332 –
Deferred share issue costs (1,535) –
Accretion of interest – 129
New Leases – 1,636
At 30 September 2024 9,832 2,988
At 1 January 2023 7,964 5,996
Changes from financing cash flows (903) (3,913)
Changes from operating cash flows (5,329) –
Termination of a lease contract – (591)
Accrued listing expenses 12,323 –
Deferred issue costs 1,297 –
Accretion of interest – 248
New leases – 2,872
At 30 September 2023 15,352 4,612
APPENDIX I ACCOUNTANTS’ REPORT
– I-44 –


--- page 579 ---
(c) Total cash outflow for leases
The total cash outflow for leases included in the consolidated statements of cash flows is as follows:
Y ear ended 31 December
Nine months ended
30 September
2022 2023 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Within operating activities 316 344 258 328
Within investing activities 28 2–––
Within financing activities 5,783 4,945 3,913 2,426
6,381 5,289 4,171 2,754
24. COMMITMENTS
At the end of each of the reporting periods, the Group did not have any significant contractual commitments.
25. RELATED PARTY TRANSACTIONS
(a) The Group had the following transactions with related parties during the Relevant Periods and the nine months
ended 30 September 2023:
Y ear ended 31 December
Nine months ended
30 September
2022 2023 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Purchase of goods and cost sharing
Ascendis Pharma Endocrinology
Division A/S (“Ascendis
Pharma Endocrinology”)
(note i) 50,667 8,451 8,451 7
Ascendis Pharma Bone Diseases
A/S (“Ascendis Pharma Bone
Diseases”) (note i) 5,256 451 451 3,310
Ascendis Pharma Growth
Disorders A/S (“Ascendis
Pharma Growth Disorders”)
(note i) 714 243 243 –
56,637 9,145 9,145 3,317
APPENDIX I ACCOUNTANTS’ REPORT
– I-45 –


--- page 580 ---
Y ear ended 31 December
Nine months ended
30 September
2022 2023 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Purchase of services
Ascendis Pharma Endocrinology 12,832 9,261 5,678 6,681
Ascendis Pharma Growth
Disorders 440 3,059 1,971 6,253
Ascendis Pharma Bone Diseases 1,320 895 629 98
14,592 13,215 8,278 13,032
Loss from a discontinued
procurement contract
Ascendis Pharma Endocrinology
(note ii) – 109,006 109,006 –
The purchases of goods and services from the related parties were made according to the published prices and
conditions agreed by the Group and the related parties.
Notes:
i Ascendis Pharma Endocrinology, Ascendis Pharma Growth Disorders and Ascendis Pharma Bone
Diseases are wholly-owned subsidiaries of Ascendis Pharma A/S (“Ascendis Pharma”). Ascendis
Pharma had significant influence on the Group as at 31 December 2022 and 2023 and 30 September
2023 and 2024.
ii In August 2022, the Group entered into a commitment and prepayment agreement (the “Agreement”)
with Ascendis Pharma Endocrinology to purchase reserved drug substance. In September 2022, the
Group prepaid Euros (“EUR”) 10,000,000 (equivalent to RMB69,171,000) to Ascendis Pharma
Endocrinology and recorded prepayment of RMB69,171,000 as of 31 December 2022.
In February 2023, the Group exercised its right to cancel its commitment to purchase the reserved drug
substance under the Agreement due to the change of its commercial supply strategy. The total loss
resulting from the cancellation is EUR15,540,000 (equivalent to RMB109,006,000), comprised of (i)
write-off of the prepayment of EUR10,000,000 (equivalent to RMB69,171,000) and (ii) provision of
EUR5,540,000 (equivalent to RMB39,835,000) which was settled in December 2023. Details of the
transaction are set out under the sections headed “FINANCIAL INFORMA TION – DESCRIPTION OF
SELECTED COMPONENTS OF STA TEMENTS OF PROFIT OR LOSS AND OTHER
COMPREHENSIVE INCOME – Other gains and losses, Net” in the Prospectus.
(b) Outstanding balances with related parties:
The Group
As at 31 December
As at
30 September
2022 2023 2024
RMB’000 RMB’000 RMB’000
Amounts due to related parties:
Trade payables
– Ascendis Pharma Endocrinology 23,623 230 2,120
– Ascendis Pharma Bone Diseases 480 – 7
– Ascendis Pharma Growth Disorders 138 109 1,472
24,241 339 3,599
APPENDIX I ACCOUNTANTS’ REPORT
– I-46 –


--- page 581 ---
As at 31 December
As at
30 September
2022 2023 2024
RMB’000 RMB’000 RMB’000
Accrued expenses
– Ascendis Pharma Endocrinology 2,145 6,785 1,143
– Ascendis Pharma Bone Diseases 2,014 401 3,319
– Ascendis Pharma Growth Disorders 714 1,265 –
4,873 8,451 4,462
Other payables
– Ascendis Pharma Endocrinology 776 – –
– Ascendis Pharma Bone Diseases 265 – –
– Ascendis Pharma Growth Disorders 156 – –
1,197 – –
30,311 8,790 8,061
Amount advanced to a related party:
Prepayments – current:
– Ascendis Pharma Endocrinology 69,171 9,367 12,494
Prepayments – non-current:
– Ascendis Pharma Endocrinology – 39,193 39,193
The Company
As at 31 December
As at
30 September
2022 2023 2024
RMB’000 RMB’000 RMB’000
Amount due from a subsidiary:
– VISEN HK 659 – –
Amount due to a related party:
Trade payables
– Ascendis Pharma Endocrinology 9,535 – –
Amount due from a subsidiary and amount advanced to a related party are trade in nature, unsecured,
non-interest-bearing and repayable on demand.
Amounts due to related parties are trade in nature, unsecured, non-interest-bearing and repayable on demand.
The carrying amounts of amounts due to related parties as at the end of each of the Relevant Periods approximated
to their fair values due to their short-term maturities.
APPENDIX I ACCOUNTANTS’ REPORT
– I-47 –


--- page 582 ---
(c) Compensation of key management personnel of the Group
Y ear ended 31 December
Nine months ended
30 September
2022 2023 2023 2024
RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited)
Salaries, allowances and benefits
in kind 8,592 8,161 6,224 6,098
Discretionary bonuses 4,791 4,298 3,202 3,300
Independent non-executive
directors’ fees 1,035 1,080 807 825
Pension scheme contributions 81 33 29 122
Share-based payment expenses/
(credit) 80,857 (5,372) 17,903 26,109
95,356 8,200 28,165 36,454
Further details of directors’ and the chief executive’s emoluments are included in note 9 to the Historical
Financial Information.
26. FINANCIAL INSTRUMENTS BY CATEGORY
The carrying amounts of each of the categories of financial instruments as at the end of each of the Relevant
Periods are as follows:
The Group
As at 31 December 2022
Financial assets
Financial assets
at amortised cost
RMB’000
Financial assets included in prepayments and other receivables 3,149
Cash and cash equivalents 626,458
629,607
Financial liabilities
Financial
liabilities at
amortised cost
RMB’000
Financial liabilities included in trade and other payables 35,076
Amounts due to related parties 30,311
65,387
APPENDIX I ACCOUNTANTS’ REPORT
– I-48 –


--- page 583 ---
As at 31 December 2023
Financial assets
Financial assets
at amortised cost
RMB’000
Financial assets included in prepayments and other receivables 5,310
Cash and cash equivalents 347,782
353,092
Financial liabilities
Financial
liabilities at
amortised cost
RMB’000
Financial liabilities included in trade and other payables 22,414
Amounts due to related parties 8,790
31,204
As at 30 September 2024
Financial assets
Financial assets
at amortised cost
RMB’000
Financial assets included in prepayments and other receivables 3,297
Cash and cash equivalents 242,647
245,944
Financial liabilities
Financial
liabilities at
amortised cost
RMB’000
Financial liabilities included in trade and other payables 24,798
Amounts due to related parties 8,061
32,859
APPENDIX I ACCOUNTANTS’ REPORT
– I-49 –


--- page 584 ---
The Company
As at 31 December 2022
Financial assets
Financial assets
at amortised cost
RMB’000
Financial assets included in prepayments and other receivables 1,085
Amount due from a subsidiary 659
Cash and cash equivalents 440,425
442,169
Financial liabilities
Financial
liabilities at
amortised cost
RMB’000
Financial liabilities included in other payables 8,370
Amount due to a related party 9,535
17,905
As at 31 December 2023
Financial assets
Financial assets
at amortised cost
RMB’000
Financial assets included in prepayments and other receivables 3,288
Cash and cash equivalents 232,841
236,129
Financial liabilities
Financial
liabilities at
amortised cost
RMB’000
Financial liabilities included in other payables 11,267
APPENDIX I ACCOUNTANTS’ REPORT
– I-50 –


--- page 585 ---
As at 30 September 2024
Financial assets
Financial assets
at amortised cost
RMB’000
Financial assets included in prepayments and other receivables 1,282
Cash and cash equivalents 93,670
94,952
Financial liabilities
Financial
liabilities at
amortised cost
RMB’000
Financial liabilities included in other payables 10,022
27. FAIR V ALUE AND FAIR V ALUE HIERARCHY OF FINANCIAL INSTRUMENTS
Fair values
All the carrying amounts of the Group’s financial instruments are those with carrying amounts that reasonably
approximate to fair values. Management has assessed that the fair values of cash and cash equivalents, financial
assets included in prepayments and other receivables (in the current portion), financial liabilities included in trade
and other payables, amounts due to related parties and lease liabilities (in the current portion) approximate to their
carrying amounts largely due to the short-term maturities of these instruments. The fair values of the other
non-current financial assets and financial liabilities have been calculated by discounting the expected future cash
flows using rates currently available for instruments with similar terms, credit risk and remaining maturities. The
Group did not have any financial assets or liabilities, other than stated above, measured at fair value at the end of
each of the Relevant Periods.
The Group’s finance department headed by the finance manager is responsible for determining the policies and
procedures for the fair value measurement of financial instruments. At the end of each of the Relevant Periods, the
finance department analyses the movements in the values of financial instruments and determines the major inputs
applied in the valuation. The directors review the results of the fair value measurement of financial instruments
periodically for financial reporting.
The Group’s principal financial instruments comprise cash and cash equivalents. The main purpose of these
financial instruments is to raise finance for the Group’s operations. The Group has various other financial assets and
liabilities such as other receivables and trade and other payables, which arise directly from its operations.
The main risks arising from the Group’s financial instruments are foreign currency risk, credit risk and
liquidity risk. The board of directors of the Company reviews and agrees policies for managing each of these risks
and they are summarised below.
APPENDIX I ACCOUNTANTS’ REPORT
– I-51 –


--- page 586 ---
28. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
Foreign currency risk
The Group has transactional currency exposures. Such exposures arise from purchases by operating units in
currencies other than the units’ functional currencies.
The following table demonstrates the sensitivity at the end of each of the Relevant Periods to a reasonably
possible change in foreign currency exchange rates, with all other variables held constant, of the Group’s loss before
tax (due to changes in the fair values of monetary assets and liabilities) and the Group’s equity.
Increase/
(decrease) in
rate of foreign
currency
Increase/
(decrease) in
loss before tax
Increase/
(decrease) in
equity
% RMB’000 RMB’000
31 December 2022
If RMB weakens against USD 5 (16,038) 16,038
If RMB strengthens against USD (5) 16,038 (16,038)
If RMB weakens against EUR 5 1,504 (1,504)
If RMB strengthens against EUR (5) (1,504) 1,504
If RMB weakens against TWD 5 (320) 320
If RMB strengthens against TWD (5) 320 (320)
31 December 2023
If RMB weakens against USD 5 (7,698) 7,698
If RMB strengthens against USD (5) 7,698 (7,698)
If RMB weakens against EUR 5 439 (439)
If RMB strengthens against EUR (5) (439) 439
If RMB weakens against HKD 5 (11) 11
If RMB strengthens against HKD (5) 11 (11)
If RMB weakens against TWD 5 (209) 209
If RMB strengthens against TWD (5) 209 (209)
30 September 2024
If RMB weakens against USD 5 (4,272) 4,272
If RMB strengthens against USD (5) 4,272 (4,272)
If RMB weakens against EUR 5 403 (403)
If RMB strengthens against EUR (5) (403) 403
If RMB weakens against HKD 5 (88) 88
If RMB strengthens against HKD (5) 88 (88)
If RMB weakens against TWD 5 (123) 123
If RMB strengthens against TWD (5) 123 (123)
Credit risk
For financial assets included in prepayments and other receivables, management makes periodic collective
assessment as well as individual assessment on the recoverability of other receivables based on historical settlement
records and past experience. The directors believe that there is no material credit risk inherent in the Group’s
outstanding balance of other receivables.
As at the end of each of the Relevant Periods, cash and cash equivalents were deposited in financial institutions
with good credit ratings and without significant credit risk.
Maximum exposure and year-end staging
The tables below show the credit quality and the maximum exposure to credit risk based on the Group’s credit
policy, which is mainly based on past due information unless other information is available without undue cost or
effort, and year-end staging classification as at the end of each of the Relevant Periods.
APPENDIX I ACCOUNTANTS’ REPORT
– I-52 –


--- page 587 ---
The amounts presented are gross carrying amounts for financial assets.
The Group
As at 31 December 2022
12-month
ECLs Lifetime ECLs
Stage 1 Stage 2 Stage 3 Total
RMB’000 RMB’000 RMB’000 RMB’000
Financial assets included in
prepayments and other receivables
– normal 3,149 – – 3,149
Cash and cash equivalents – not yet
past due 626,458 – – 626,458
629,607 – – 629,607
As at 31 December 2023
12-month
ECLs Lifetime ECLs
Stage 1 Stage 2 Stage 3 Total
RMB’000 RMB’000 RMB’000 RMB’000
Financial assets included in
prepayments and other receivables
– normal 5,310 – – 5,310
Cash and cash equivalents – not yet
past due 347,782 – – 347,782
353,092 – – 353,092
As at 30 September 2024
12-month
ECLs Lifetime ECLs
Stage 1 Stage 2 Stage 3 Total
RMB’000 RMB’000 RMB’000 RMB’000
Financial assets included in
prepayments and other receivables
– normal 3,297 – – 3,297
Cash and cash equivalents – not yet
past due 242,647 – – 242,647
245,944 – – 245,944
APPENDIX I ACCOUNTANTS’ REPORT
– I-53 –


--- page 588 ---
The Company
As at 31 December 2022
12-month
ECLs Lifetime ECLs
Stage 1 Stage 2 Stage 3 Total
RMB’000 RMB’000 RMB’000 RMB’000
Financial assets included in
prepayments and other receivables
– normal 1,085 – – 1,085
Amount due from a subsidiary –
normal 659 – – 659
Cash and cash equivalents – not yet
past due 440,425 – – 440,425
442,169 – – 442,169
As at 31 December 2023
12-month
ECLs Lifetime ECLs
Stage 1 Stage 2 Stage 3 Total
RMB’000 RMB’000 RMB’000 RMB’000
Financial assets included in
prepayments and other receivables
– normal 3,288 – – 3,288
Cash and cash equivalents – not yet
past due 232,841 – – 232,841
236,129 – – 236,129
As at 30 September 2024
12-month
ECLs Lifetime ECLs
Stage 1 Stage 2 Stage 3 Total
RMB’000 RMB’000 RMB’000 RMB’000
Financial assets included in
prepayments and other receivables
– normal 1,282 – – 1,282
Cash and cash equivalents – not yet
past due 93,670 – – 93,670
94,952 – – 94,952
APPENDIX I ACCOUNTANTS’ REPORT
– I-54 –


--- page 589 ---
Liquidity risk
The Group monitors and maintains a level of cash and cash equivalents deemed adequate by the management
of the Group to finance the operations and mitigate the effects of fluctuations in cash flows.
The maturity profile of the Group’s financial liabilities as at the end of each of the Relevant Periods, based
on the contractual undiscounted payments, is as follows:
As at 31 December 2022
On demand
Less than
1 year 1 to 5 years Total
RMB’000 RMB’000 RMB’000 RMB’000
Amounts due to related parties 30,311 – – 30,311
Financial liabilities included in trade
and other payables 35,076 – – 35,076
Lease liabilities – 4,915 1,350 6,265
65,387 4,915 1,350 71,652
As at 31 December 2023
On demand
Less than
1 year 1 to 5 years Total
RMB’000 RMB’000 RMB’000 RMB’000
Amounts due to related parties 8,790 – – 8,790
Financial liabilities included in trade
and other payables 22,414 – – 22,414
Lease liabilities – 2,682 1,117 3,799
31,204 2,682 1,117 35,003
As at 30 September 2024
On demand
Less than
1 year 1 to 5 years Total
RMB’000 RMB’000 RMB’000 RMB’000
Amounts due to related parties 8,061 – – 8,061
Financial liabilities included in trade
and other payables 24,798 – – 24,798
Lease liabilities – 2,467 606 3,073
32,859 2,467 606 35,932
APPENDIX I ACCOUNTANTS’ REPORT
– I-55 –


--- page 590 ---
The maturity profile of the Company’s financial liabilities as at the end of each of the Relevant Periods, based
on the contractual undiscounted payments, is as follows:
As at 31 December 2022
On demand
Less than
1 year 1 to 5 years Total
RMB’000 RMB’000 RMB’000 RMB’000
Financial liabilities included in
other payables 8,370 – – 8,370
Amount due to a related party 9,535 – – 9,535
17,905 – – 17,905
As at 31 December 2023
On demand
Less than
1 year 1 to 5 years Total
RMB’000 RMB’000 RMB’000 RMB’000
Financial liabilities included in
other payables 11,267 – – 11,267
11,267 – – 11,267
As at 30 September 2024
On demand
Less than
1 year 1 to 5 years Total
RMB’000 RMB’000 RMB’000 RMB’000
Financial liabilities included in
other payables 10,022 – – 10,022
10,022 – – 10,022
Capital management
The primary objectives of the Group’s capital management are to safeguard the Group’s ability to continue as
a going concern and to maintain healthy capital ratios in order to support its business and maximise shareholders’
value.
The Group manages its capital structure and makes adjustments to it in light of changes in economic conditions
and the risk characteristics of the underlying assets. To maintain or adjust the capital structure, the Group may adjust
the dividend payment to shareholders, return capital to shareholders or issue new shares. The Group is not subject
to any externally imposed capital requirements. No changes were made in the objectives, policies or processes for
managing capital during the Relevant Periods.
APPENDIX I ACCOUNTANTS’ REPORT
– I-56 –


--- page 591 ---
29. EVENTS AFTER THE RELEV ANT PERIODS
(a) In February 2025, the Company allotted and issued 330,000 non-voting ordinary shares of the Company
under the Equity Incentive Plan to VP EIP US LIMITED in order to facilitate the administration of the
plan for no consideration. Meanwhile, the Company entered into share surrender agreement with VP EIP
NUS LIMITED, pursuant to which 765,000 non-voting ordinary shares of the Company were
surrendered and cancelled for no consideration.
(b) In March 2025, the Company granted restricted share units to certain grantees to subscribe for an
aggregate of 2,478,000 shares under the Equity Incentive Plan.
30. SUBSEQUENT FINANCIAL STATEMENTS
No audited financial statements have been prepared by the Company, the Group or any of the companies now
comprising the Group in respect of any period subsequent to 30 September 2024.
APPENDIX I ACCOUNTANTS’ REPORT
– I-57 –


--- page 592 ---
The following information does not form part of the Accountants’ Report from Ernst &
Young, Certified Public Accountants, Hong Kong, the Company’ s reporting accountants, as set
out in Appendix I to this prospectus, and is included for information purposes only. The
unaudited pro forma financial information should be read in conjunction with the section
headed “Financial Information” in this prospectus and the Accountants’ Report set out in
Appendix I to this prospectus.
A. UNAUDITED PRO FORMA STATEMENT OF ADJUSTED CONSOLIDATED NET
TANGIBLE ASSETS
The following unaudited pro forma statement of adjusted consolidated net tangible assets
of the Group prepared in accordance with Rule 4.29 of the Listing Rules and with reference to
Accounting Guideline 7 Preparation of Pro Forma Financial Information for Inclusion in
Investment Circulars issued by the Hong Kong Institute of Certified Public Accountants is to
illustrate the effect of the Global Offering on the consolidated net tangible assets of the Group
attributable to owners of the Company as at 30 September 2024 as if the Global Offering had
taken place on that date.
The unaudited pro forma statement of adjusted consolidated net tangible assets of the
Group has been prepared for illustrative purposes only and, because of its hypothetical nature,
it may not provide a true picture of the consolidated net tangible assets attributable to owners
of the Company had the Global Offering been completed as at 30 September 2024 or at any
future date.
Audited
consolidated net
tangible assets of
the Group
attributable to
owners of the
Company as of
30 September 2024
Estimated net
proceeds from
the Global
Offering
Unaudited pro
forma adjusted
consolidated net
tangible assets
attributable to
owners of the
Company as of
30 September 2024
Unaudited pro forma adjusted
consolidated net tangible assets
attributable to owners of the
Company per share as of
30 September 2024
RMB’000 RMB’000 RMB’000 RMB HKD
(Note 1) (Note 2) (Note 3) (Note 4)
Based on offer price
HKD68.44 per
offer share 289,529 590,068 879,597 7.82 8.48
Based on offer price
HKD71.86 per
offer share 289,529 620,048 909,577 8.09 8.77
Based on offer price
HKD75.28 per
offer share 289,529 650,028 939,557 8.36 9.06
APPENDIX IIA UNAUDITED PRO FORMA FINANCIAL INFORMATION
– IIA-1 –


--- page 593 ---
Notes:
(1) The consolidated net tangible assets of the Group attributable to equity holders of the Company as at
30 September 2024 was equal to the audited net assets attributable to owners of the Company as at 30
September 2024 of RMB289,598,000 after deducting of intangible assets of RMB69,000 as at 30
September 2024 set out in the Accountants’ Report in Appendix I to this prospectus.
(2) The estimated net proceeds from the Global Offering are based on an Offer Price of HKD68.44,
HKD71.86 and HKD75.28, after deduction of the underwriting fees and other related expenses payable
by the Company (excluding the listing expense that have been charged to profit or loss as of 30
September 2024) and does not take into account any Shares which may be issued upon the exercise of
the Over-allotment Option and the Offer Size Adjustment Option.
(3) The unaudited pro forma adjusted consolidated net tangible assets per Share is arrived at after
adjustments referred in note 2 above and on the basis of 112,441,864 Shares in issue, assuming that (i)
the Global Offering and (ii) the issuance of 330,000 Shares and cancellation of 765,000 Shares have
been completed on 30 September 2024 but does not take into account (i) any Shares which may be sold
pursuant to the exercise of the Offer Size Adjustment Option and the Over-allotment Option, or (ii) any
Shares which may be issued under the Post-IPO share incentive scheme.
(4) For the purpose of this unaudited pro forma statement of adjusted net tangible assets, the balances stated
in RMB are converted into HKD at the rate of RMB1.00 to HKD1.0841.
(5) No adjustment has been made to the unaudited pro forma adjusted consolidated net tangible assets to
reflect any trading results or other transactions of the Group entered into subsequent to 30 September
2024.
APPENDIX IIA UNAUDITED PRO FORMA FINANCIAL INFORMATION
– IIA-2 –


--- page 594 ---
B. INDEPENDENT REPORTING ACCOUNTANTS’ ASSURANCE REPORT ON THE
COMPILATION OF PRO FORMA FINANCIAL INFORMATION
⭰㰟㛪姯⸒Ṳ⋀㈧
榀㸖毩歁㵳勘䙮怺979噆
⤑⏋✱ᷧ⺎27㧺
Tel 曢婘: +852 2846 9888
Fax ₚ䜆: +852 2868 4432
ey.com
Ernst & Young
27/F, One Taikoo Place
979 King’s Road
Quarry Bay, Hon
g Kong
To the Directors of VISEN Pharmaceuticals
We have completed our assurance engagement to report on the compilation of pro forma
financial information of VISEN Pharmaceuticals (the “Company”) and its subsidiaries
(hereinafter collectively referred to as the “Group”) by the directors of the Company (the
“Directors”) for illustrative purposes only. The pro forma financial information consists of the
pro forma consolidated net tangible assets as at 30 September 2024, and related notes as set out
on pages IIA-1 to IIA-2 of the prospectus dated 13 March 2025 issued by the Company (the
“Pro Forma Financial Information”). The applicable criteria on the basis of which the Directors
have compiled the Pro Forma Financial Information are described in Appendix IIA.
The Pro Forma Financial Information has been compiled by the Directors to illustrate the
impact of the global offering of shares of the Company on the Group’s financial position as at
30 September 2024 as if the transaction had taken place at 30 September 2024. As part of this
process, information about the Group’s financial position, has been extracted by the Directors
from the Group’s financial statements for the period ended 30 September 2024, on which an
accountants’ report has been published.
Directors’ responsibility for the Pro Forma Financial Information
The Directors are responsible for compiling the Pro Forma Financial Information in
accordance with paragraph 4.29 of the Rules Governing the Listing of Securities on The Stock
Exchange of Hong Kong Limited (the “Listing Rules”) and with reference to Accounting
Guideline (“AG”) 7 Preparation of Pro Forma Financial Information for Inclusion in
Investment Circulars issued by the Hong Kong Institute of Certified Public Accountants (the
“HKICPA”).
Our independence and quality management
We have complied with the independence and other ethical requirements of the Code of
Ethics for Professional Accountants issued by the HKICPA, which is founded on fundamental
principles of integrity, objectivity, professional competence and due care, confidentiality and
professional behavior.
APPENDIX IIA UNAUDITED PRO FORMA FINANCIAL INFORMATION
– IIA-3 –


--- page 595 ---
Our firm applies Hong Kong Standard on Quality Management 1 Quality Management for
Firms that Perform Audits or Reviews of Financial Statements, or Other Assurance and
Related Services Engagements which requires the firm to design, implement and operate a
system of quality management including policies or procedures regarding compliance with
ethical requirements, professional standards and applicable legal and regulatory requirements.
Reporting accountants’ responsibilities
Our responsibility is to express an opinion, as required by paragraph 4.29(7) of the
Listing Rules, on the Pro Forma Financial Information and to report our opinion to you. We do
not accept any responsibility for any reports previously given by us on any financial
information used in the compilation of the Pro Forma Financial Information beyond that owed
to those to whom those reports were addressed by us at the dates of their issue.
We conducted our engagement in accordance with Hong Kong Standard on Assurance
Engagements 3420 Assurance Engagements to Report on the Compilation of Pro Forma
Financial Information Included in a Prospectus issued by the HKICPA. This standard requires
that the reporting accountants plan and perform procedures to obtain reasonable assurance
about whether the Directors have compiled the Pro Forma Financial Information in accordance
with paragraph 4.29 of the Listing Rules and with reference to AG 7 issued by the HKICPA.
For purposes of this engagement, we are not responsible for updating or reissuing any
reports or opinions on any historical financial information used in compiling the Pro Forma
Financial Information, nor have we, in the course of this engagement, performed an audit or
review of the financial information used in compiling the Pro Forma Financial Information.
The purpose of the Pro Forma Financial Information included in the Prospectus is solely
to illustrate the impact of the global offering of shares of the Company on unadjusted financial
information of the Group as if the transaction had been undertaken at an earlier date selected
for purposes of the illustration. Accordingly, we do not provide any assurance that the actual
outcome of the transaction would have been as presented.
A reasonable assurance engagement to report on whether the Pro Forma Financial
Information has been properly compiled on the basis of the applicable criteria involves
performing procedures to assess whether the applicable criteria used by the Directors in the
compilation of the Pro Forma Financial Information provide a reasonable basis for presenting
the significant effects directly attributable to the transaction, and to obtain sufficient
appropriate evidence about whether:
 the related pro forma adjustments give appropriate effect to those criteria; and
 the Pro Forma Financial Information reflects the proper application of those
adjustments to the unadjusted financial information.
APPENDIX IIA UNAUDITED PRO FORMA FINANCIAL INFORMATION
– IIA-4 –


--- page 596 ---
The procedures selected depend on the reporting accountants’ judgment, having regard to
the reporting accountants’ understanding of the nature of the Group, the transaction in respect
of which the Pro Forma Financial Information has been compiled, and other relevant
engagement circumstances.
The engagement also involves evaluating the overall presentation of the Pro Forma
Financial Information.
We believe that the evidence we have obtained is sufficient and appropriate to provide a
basis for our opinion.
Opinion
In our opinion:
(a) the Pro Forma Financial Information has been properly compiled on the basis stated;
(b) such basis is consistent with the accounting policies of the Group; and
(c) the adjustments are appropriate for the purposes of the Pro Forma Financial
Information as disclosed pursuant to paragraph 4.29(1) of the Listing Rules.
Ernst & Y oung
Certified Public Accountants
Hong Kong
13 March 2025
APPENDIX IIA UNAUDITED PRO FORMA FINANCIAL INFORMATION
– IIA-5 –


--- page 597 ---
The following is the preliminary financial information of our Group as at and for the year
ended 31 December 2024 (the “2024 Preliminary Financial Information”), together with a
management’ s discussion and analysis of our Group’ s financial position and results of
operations. The preliminary financial information has been prepared based on the
consolidated financial statements of the Group prepared in accordance with IFRS Accounting
Standards. The 2024 Preliminary Financial Information was not audited. Investors should bear
in mind that the 2024 Preliminary Financial Information in this appendix may be subject to
adjustments.
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER
COMPREHENSIVE INCOME
Y ear ended 31 December
Notes 2024 2023
RMB’000 RMB’000
Other income 4 9,864 11,356
Other gains and losses, net 5 2,375 (106,695)
Research and development costs (90,521) (57,690)
Administrative expenses (86,434) (79,944)
Finance costs 7 (161) (317)
Listing expenses (17,365) (16,280)
LOSS BEFORE TAX 6 (182,242) (249,570)
Income tax expense 8 ––
LOSS FOR THE YEAR (182,242) (249,570)
Attributable to:
Owners of the Company (182,242) (249,570)
OTHER COMPREHENSIVE INCOME
Other comprehensive income/(loss) that
may be reclassified to profit or loss
in subsequent periods:
Exchange differences on translation of the
financial statements of subsidiaries (131) 106
OTHER COMPREHENSIVE INCOME/(LOSS)
FOR THE YEAR, NET OF TAX (131) 106
TOTAL COMPREHENSIVE LOSS
FOR THE YEAR (182,373) (249,464)
Attributable to:
Owners of the Company (182,373) (249,464)
LOSS PER SHARE A TTRIBUTABLE
TO ORDINARY EQUITY HOLDERS
OF THE COMPANY
Basic and diluted 10 N/A N/A
APPENDIX IIB UNAUDITED PRELIMINARY FINANCIAL INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 2024
– IIB-1 –


--- page 598 ---
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 31 December
Notes 2024 2023
RMB’000 RMB’000
NON-CURRENT ASSETS
Property, plant and equipment 277 876
Right-of-use assets 10,879 12,379
Intangible assets 54 567
Amount advanced to a related party 15 39,193 39,193
Prepayments and other receivables 11 20,847 16,660
Total non-current assets 71,250 69,675
CURRENT ASSETS
Prepayments and other receivables 11 11,184 16,972
Amounts advanced to a related party 15 7,802 9,367
Cash and cash equivalents 203,587 347,782
Total current assets 222,573 374,121
CURRENT LIABILITIES
Trade and other payables 12 38,788 37,582
Deferred income – 2,900
Amounts due to related parties 15 11,403 8,790
Lease liabilities 1,997 2,552
Total current liabilities 52,188 51,824
NET CURRENT ASSETS 170,385 322,297
TOTAL ASSETS LESS CURRENT
LIABILITIES 241,635 391,972
NON-CURRENT LIABILITIES
Lease liabilities 360 1,097
Total non-current liabilities 360 1,097
Net assets 241,275 390,875
EQUITY
Equity attributable to owners of the Company
Share capital 13 70 70
Treasury shares 13 (6) (6)
Reserves 241,211 390,811
Total equity 241,275 390,875
APPENDIX IIB UNAUDITED PRELIMINARY FINANCIAL INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 2024
– IIB-2 –


--- page 599 ---
NOTES TO THE PRELIMINARY FINANCIAL INFORMATION
1. BASIS OF PREPARATION
This Preliminary Financial Information has been prepared in accordance with the applicable disclosure
requirements of Appendix D2 to the Rules Governing the Listing of Securities on the Main Board of The Stock
Exchange of Hong Kong Limited in relation to annual results announcements.
The consolidated financial statements have been prepared in accordance with IFRS Accounting Standards
issued by the International Accounting Standards Board. They have been prepared under the historical cost
convention. The consolidated financial statements are presented in Renminbi (“RMB”) and all values are rounded to
the nearest thousand except when otherwise indicated.
The Preliminary Financial Information does not include all of the information required for a complete set of
financial statements prepared in accordance with the IFRS Accounting Standards.
Basis of consolidation
The consolidated financial statements include the financial statements of the Company and its subsidiaries for
the year ended 31 December 2024. A subsidiary is an entity (including a structured entity), directly or indirectly,
controlled by the Company. Control is achieved when the Group is exposed, or has rights, to variable returns from
its involvement with the investee and has the ability to affect those returns through its power over the investee (i.e.,
existing rights that give the Group the current ability to direct the relevant activities of the investee).
Generally, there is a presumption that a majority of voting rights results in control. When the Company has
less than a majority of the voting or similar rights of an investee, the Group considers all relevant facts and
circumstances in assessing whether it has power over an investee, including:
(a) the contractual arrangement with the other vote holders of the investee;
(b) rights arising from other contractual arrangements; and
(c) the Group’s voting rights and potential voting rights.
The financial statements of the subsidiaries are prepared for the same reporting period as the Company, using
consistent accounting policies. The results of subsidiaries are consolidated from the date on which the Group obtains
control, and continue to be consolidated until the date that such control ceases.
All intra-group assets and liabilities, equity, income, expenses and cash flows relating to transactions between
members of the Group are eliminated in full on consolidation.
The Group reassesses whether or not it controls an investee if facts and circumstances indicate that there are
changes to one or more of the three elements of control described above. A change in the ownership interest of a
subsidiary, without a loss of control, is accounted for as an equity transaction.
If the Group loses control over a subsidiary, it derecognises the related assets (including goodwill), liabilities,
any non-controlling interest and the exchange fluctuation reserve; and recognises the fair value of any investment
retained and any resulting surplus or deficit in profit or loss. The Group’s share of components previously recognised
in other comprehensive income is reclassified to profit or loss or retained profits, as appropriate, on the same basis
as would be required if the Group had directly disposed of the related assets or liabilities.
APPENDIX IIB UNAUDITED PRELIMINARY FINANCIAL INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 2024
– IIB-3 –


--- page 600 ---
2. ISSUED BUT NOT YET EFFECTIVE IFRS ACCOUNTING STANDARDS
The Group has not applied the following new and amended IFRS Accounting Standards, that have been issued
but are not yet effective, in the consolidated financial statements for the year ended 31 December 2024. The Group
intends to apply these new and amended IFRS Accounting Standards, if applicable, when they become effective.
Amendments to IAS 21 Lack of Exchangeability
1
Amendments to IFRS 9 and IFRS 7 Amendments to the Classification and Measurement of
Financial Instruments 2
Amendments to IFRS 9 and IFRS 7 Contracts Referencing Nature-dependent Electricity 2
IFRS 18 Presentation and Disclosure in Financial Statements 3
IFRS 19 Subsidiaries without Public Accountability: Disclosures 3
Amendments to IFRS 10 and IAS 28 Sale or Contribution of Assets between an Investor and its
Associate or Joint V enture 4
Annual Improvements to IFRS
Accounting Standards – V olume 11
Amendments to IFRS 1, IFRS 7, IFRS 9, IFRS 10 and IAS 7 2
1 Effective for annual periods beginning on or after 1 January 2025
2 Effective for annual periods beginning on or after 1 January 2026
3 Effective for annual/reporting periods beginning on or after 1 January 2027
4 No mandatory effective date yet determined but available for adoption
The Group is in the process of making an assessment of the impact of these new and amended IFRS Accounting
Standards upon initial application. IFRS 18 introduce new requirements on presentation within the statement of profit
or loss, including specified totals and subtotals. It also requires disclosure of management-defined performance
measures in a note and includes new requirements for aggregation and disaggregation of financial information. The
new requirements are expected to impact the Group’s presentation in the statement of profit or loss and other
comprehensive income and disclosures of the Group’s financial performance. However, the application of IFRS 18
is not expected to have any impact on the financial position or performance of the Group. Other than IFRS 18, so
far, the Group considers that IFRS 19 and the amended IFRS Accounting Standards are unlikely to have a significant
impact on the Group’s results of operations and financial position.
3. OPERATING SEGMENT INFORMATION
Operating segment information
For management purposes, the Group has only one reportable operating segment, which is developing and
commercialising paradigm-shifting endocrine therapies. Since this is the only reportable operating segment of the
Group, no further operating segment analysis thereof is presented.
Geographical information
Since nearly all of the Group’s non-current assets were located in Chinese Mainland, no geographical segment
information in accordance with IFRS 8 Operating Segments is presented.
APPENDIX IIB UNAUDITED PRELIMINARY FINANCIAL INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 2024
– IIB-4 –


--- page 601 ---
4. OTHER INCOME
Y ear ended 31 December
2024 2023
RMB’000 RMB’000
Government grants and other subsidies
related to income (note) 3,094 211
Bank interest income 6,770 11,145
Total 9,864 11,356
Note: Government grants have been received from the PRC local government authorities to support a
subsidiary’s operating activities. There are no unfulfilled conditions relating to these government grants.
5. OTHER GAINS AND LOSSES, NET
Y ear ended 31 December
2024 2023
RMB’000 RMB’000
Net foreign exchange gains 2,692 4,706
Grants (note i) (317) (1,407)
Donations (note ii) – (473)
Loss on disposal of property, plant and equipment – (242)
Loss on termination of a lease contract – (273)
Loss from a discontinued
procurement contract (Note 15(a)(ii)) – (109,006)
2,375 (106,695)
Notes:
i. During the years ended 31 December 2023 and 2024, the Group granted RMB1,407,000 and
RMB317,000, respectively, to a national cooperative exchange platform for rare diseases for sponsoring
its research on diagnosis consensus of achondroplasia in the PRC.
ii. During the year ended 31 December 2023, the Group donated RMB473,000 to non-profit making
organisations for the purpose of epidemic relief and public welfare.
APPENDIX IIB UNAUDITED PRELIMINARY FINANCIAL INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 2024
– IIB-5 –


--- page 602 ---
6. LOSS BEFORE TAX
The Group’s loss before tax was arrived at after charging/(crediting):
Y ear ended 31 December
2024 2023
RMB’000 RMB’000
Depreciation of property, plant and equipment 716 1,509
Depreciation of right-of-use assets 3,237 4,639
Amortisation of intangible assets 513 848
Loss from a discontinued procurement contract – 109,006
Listing expenses 17,365 16,280
Loss on disposal of items of property, plant and equipment – 242
Auditors’ remuneration 252 146
Short-term lease payments 467 344
Loss on termination of a lease contract – 273
Staff costs (including directors’ emoluments):
– Salaries, discretionary bonuses, allowances and benefits in
kind 62,648 75,200
– Pension scheme contributions 3,426 3,704
– Share-based payment expenses/(credit) 32,773 (12,266)
98,847 66,638
7. FINANCE COSTS
Y ear ended 31 December
2024 2023
RMB’000 RMB’000
Interest on lease liabilities 161 317
8. INCOME TAX
The Group is subject to income tax on an entity basis on profits arising in or derived from the jurisdictions
in which members of the Group are domiciled and operate.
Cayman Islands
Under the current laws of the Cayman Islands, the Company is not subject to tax on income or capital gains.
In addition, upon payments of dividends by the Company to its shareholders, no Cayman Islands withholding tax is
imposed on the Company.
British Virgin Islands
Under the current laws of the British Virgin Islands (“BVI”), the subsidiary incorporated in the BVI is not
subject to tax on income or capital gains. In addition, upon payments of dividends to its shareholder, no BVI
withholding tax is imposed on the subsidiary.
APPENDIX IIB UNAUDITED PRELIMINARY FINANCIAL INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 2024
– IIB-6 –


--- page 603 ---
Hong Kong
The subsidiary incorporated in Hong Kong is subject to Hong Kong profits tax at the statutory rate of 16.5%
on any estimated assessable profits arising in Hong Kong. No provision for Hong Kong profits tax was made for the
year (2023: Nil) as the Group did not generate any assessable profits arising in Hong Kong during the year.
Chinese Mainland
Pursuant to the Corporate Income Tax Law of the People’s Republic of China and the respective regulations
(the “CIT Law”), the subsidiaries which operate in Chinese Mainland are subject to CIT at a rate of 25% on the
taxable income during the years ended 31 December 2023 and 2024.
Pursuant to the relevant CIT Laws, VISEN SH enjoyed super deduction of 200% on qualifying research and
development expenditures during the years ended 31 December 2023 and 2024.
Taiwan
The subsidiary incorporated in Taiwan is subject to Taiwan profits tax. The first TWD120,000 of assessable
profits of this subsidiary are not subject to tax and the remaining assessable profits are taxed at 20%. No Taiwan
profits tax was provided for as the Group did not generate any assessable profits arising in Taiwan during the years
ended 31 December 2023 and 2024.
A reconciliation of the tax expense applicable to loss before tax at the statutory rate for the country (or
jurisdictions) in which the Company and majority of its subsidiaries are domiciled and/or operate to the tax expense
at the effective tax rate is as follows:
Y ear ended 31 December
2024 2023
RMB’000 RMB’000
Loss before tax (182,242) (249,570)
Tax at the statutory tax rate (25%) (45,561) (62,393)
Lower tax rate enacted by local authority 3,886 13,177
Tax effect of expenses not deductible for tax purposes 9,542 15,665
Income not subject to tax (159) (238)
Additional deductible allowance for research and
development expenses (18,097) (16,960)
Tax effect of tax losses and deductible temporary differences
not recognised 50,389 50,749
Tax charge at the Group’s effective rate – –
The Group had tax losses in Chinese Mainland of RMB725,072,000 and RMB886,979,000 in aggregate as at
31 December 2023 and 2024, respectively, that will expire in one to five years for offsetting against future taxable
profits of the company in which the losses arose.
Deferred tax assets have not been recognised in respect of tax losses and deductible temporary differences as
they have arisen in the subsidiaries that have been loss-making for some time and it is not considered probable that
taxable profits in foreseeable future will be available against which the tax losses and deductible temporary
differences can be utilised.
Since the Group did not fall within the scope of the Pillar Two model rules, the Pillar Two model rules did not
have any impact to the Group during the year.
APPENDIX IIB UNAUDITED PRELIMINARY FINANCIAL INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 2024
– IIB-7 –


--- page 604 ---
9. DIVIDENDS
No dividend was paid or declared by the Company during the year (2023: Nil).
10. LOSS PER SHARE ATTRIBUTABLE TO ORDINARY EQUITY HOLDERS OF THE COMPANY
No loss per share information is presented as its inclusion, for the purpose of this financial information, is not
considered meaningful.
11. PREPAYMENTS AND OTHER RECEIV ABLES
As at 31 December
2024 2023
RMB’000 RMB’000
Non-current:
V alue-added tax recoverable 20,536 16,137
Rental deposits 311 523
20,847 16,660
Current:
Prepayments for research and development services 3,643 5,308
Deferred share issue costs 4,783 6,053
Other prepayments 457 824
Bank interest receivable 1,715 4,036
Other receivables 54 54
Rental deposits 532 697
11,184 16,972
12. TRADE AND OTHER PAYABLES
As at 31 December
2024 2023
RMB’000 RMB’000
Trade payables 835 669
Accrued expenses for research and development services 9,316 8,078
Salary and discretionary bonus payables 12,100 13,316
Other payables 4,792 2,590
Accrued listing expenses 9,075 11,077
Other taxes payable 2,670 1,852
38,788 37,582
APPENDIX IIB UNAUDITED PRELIMINARY FINANCIAL INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 2024
– IIB-8 –


--- page 605 ---
An ageing analysis of the trade payables and the trade payables due to related parties as at the end of the
reporting period, based on the invoice date, is as follows:
As at 31 December
2024 2023
RMB’000 RMB’000
Trade payables
Within 3 months 835 669
Trade payables to related parties (Notes 15(b))
Within 3 months 10,281 339
Trade and other payables are unsecured and non-interest-bearing. The carrying amounts of financial liabilities
included in trade and other payables as at the end of the reporting period approximated to their fair values due to their
short-term maturities.
13. SHARE CAPITAL AND TREASURY SHARES
The Company was incorporated on 1 November 2018 with authorised share capital of USD50,000 divided into
500,000,000 ordinary shares with a par value of USD0.0001 each.
On 7 November 2018, the authorised share capital of the Company was changed to USD50,000 divided into:
(i) 420,000,000 ordinary shares, and (ii) 80,000,000 Series A Preferred Shares, with a par value of USD0.0001 each.
On 8 January 2021, the authorised share capital of the Company was changed to USD50,000 divided into: (i)
386,363,636 ordinary shares, (ii) 20,000,000 non-voting ordinary shares, (iii) 80,000,000 Series A Preferred Shares,
and (iv) 13,636,364 Series B Preferred Shares, with a par value of US$0.0001 each.
On 16 November 2022, the authorised share capital of the Company was changed to USD50,000 divided into:
(i) 397,023,136 ordinary shares, (ii) 8,905,500 non-voting ordinary shares, (iii) 80,000,000 Series A Preferred Shares,
and (iv) 13,636,364 Series B Preferred Shares, with a par value of US$0.0001 each.
Issued and fully paid share capital:
As at 1 January 2023, 31 December 2023
and 31 December 2024
Number of
shares in issue Share capital
USD’000 RMB’000
Non-voting ordinary shares of USD0.0001 each 9,340,500 1 6
Series A Preferred Shares of USD0.0001 each 80,000,000 8 55
Series B Preferred Shares of USD0.0001 each 13,636,364 1 9
102,976,864 10 70
Treasury shares:
Number of shares Treasury shares
RMB’000
As at 1 January 2023, 31 December 2023
and 31 December 2024 9,340,500 6
APPENDIX IIB UNAUDITED PRELIMINARY FINANCIAL INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 2024
– IIB-9 –


--- page 606 ---
Preferred shares
On 7 November 2018, the Company issued 80,000,000 Series A convertible preferred shares (“Series A
Preferred Shares”) to the investors of the Company at a price of USD1.00 per share with a par value of USD0.0001
each. The difference between the issue price and the par value of the shares issued amounting to USD79,992,000
(equivalent to RMB552,465,000) was recognised as share premium.
On 8 January 2021, the Company issued 13,636,364 series B convertible preferred shares (“Series B Preferred
Shares”) to the series B investors of the Company at a price of USD11.00 per share with a par value of USD0.0001
each. The difference between the issue price and the par value of the shares issued amounting to USD149,998,640
(equivalent to RMB970,788,000) was recognised as share premium.
Series A Preferred Shares and Series B Preferred Shares (“Preferred Shares”) are accounted for as equity. The
details of Series A Preferred Shares and Series B Preferred Shares are set out as follows:
Conversion features
Each holder of Preferred Shares shall have the right, at such holder’s sole discretion, at any time after the date
of issuance, to convert Preferred Shares into such number of fully paid ordinary shares as determined by dividing the
relevant issue price by the then-effective conversion price. The conversion prices for Preferred Shares are initially
the respective Preferred Shares subscription price, resulting in an initial conversion ratio of 1:1, and shall be subject
to adjustments to reflect share dividends, share splits, recapitalisation and other value adjustment events.
Each of the Preferred Shares shall automatically be converted into ordinary shares upon the closing of a
firm-commitment underwritten initial public offering by the Company of its ordinary shares or a reverse merger of
the Company with a listed company, on a reputable securities exchange for a minimum offering price as required by
shareholders.
Liquidation preferences
In the event of any liquidation, dissolution or winding up of the Company, either voluntary or involuntary or
the consummation of a Deemed Liquidation Event (as defined below), all assets and funds of the Company legally
available for distribution to the shareholders of the Company (after satisfaction of all creditors’ claims and claims
that may be preferred by law) shall be distributed to the holders of Preferred Shares with an amount equal to the
greater of (i) one times the applicable Preferred Share issue price, plus all declared but unpaid dividends thereon, and
(ii) such amount per share as would have been payable had all Preferred Shares been converted into ordinary shares
immediately prior to such liquidation, dissolution, winding up or Deemed Liquidation Event (“Preference Amount”).
If there are any assets or funds remaining after the aggregate Preferred Shares have been distributed or paid
fully, the remaining assets and funds of the Company legally available for distribution shall be distributed among all
holders of the ordinary shares and the non-voting ordinary shares, in proportion to the number of ordinary shares held
by such holders (assuming the conversion of all non-voting ordinary shares into ordinary shares).
The following events (each a “Deemed Liquidation Event”) shall be deemed a liquidation, dissolution or
winding up of the Company unless the holders of (i) at least sixty percent of the outstanding Series A Preferred Shares
and (ii) at least fifty percent of the outstanding Series B Preferred Shares elect otherwise, (i) any acquisition, sale
of shares, merger, consolidation or other similar transaction involving any subsidiary in which its shareholders do not
retain a majority of the voting power in the surviving entity or the parent of the surviving entity (except any
transaction effected solely to change the subsidiary’s domicile); or (ii) any sale, lease, transfer, exclusive license or
disposition by the Company or any subsidiary of all or substantially all the assets or intellectual property of the
subsidiaries, taken as a whole.
Based on the features of the Preferred Shares set out above, the Preferred Shares include no contractual
obligation: (i) to deliver a variable number of its own equity instruments; or (ii) to deliver cash or another financial
asset to the holders of Preferred Shares; or (iii) to exchange financial assets or financial liabilities with the holders
of Preferred Shares under conditions that are potentially unfavourable to the Company. Accordingly, the Preferred
Shares are recognised as equity.
APPENDIX IIB UNAUDITED PRELIMINARY FINANCIAL INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 2024
– IIB-10 –


--- page 607 ---
14. SHARE-BASED PAYMENTS
The Company adopted an equity incentive plan (the “Equity Incentive Plan”) on 29 April 2019, as amended
and restated by the Company on 8 January 2021 and 10 March 2021, respectively, for the purpose of providing
incentives and rewards to eligible participants who contribute to the success of the Group. Eligible participants of
the Equity Incentive Plan may include any officer, directors, employees of the Company, and any individual
consultants or advisors who render or have rendered bona fide services to the Company. The Equity Incentive Plan
will automatically terminate on 28 April 2029.
In March 2021, the Company allotted and issued a total of 20,000,000 non-voting ordinary shares of the
Company under the Equity Incentive Plan to certain special purpose vehicles in order to facilitate the administration
of the plan. On 15 November 2022, the Company entered into share surrender agreements, pursuant to which
10,659,500 non-voting ordinary shares of the Company were surrendered and cancelled for no consideration. On 15
March 2021, 30 August 2021, and 17 March 2022, the Company has granted restricted share units to 45, 5, and 11
grantees to subscribe for an aggregate of 6,340,000, 1,180,000, and 340,000 shares under the Equity Incentive Plan,
respectively. These granted restricted share units will be vested in accordance with certain service conditions and
non-market performance conditions. The subscription price for the restricted share units are all nil.
The restricted share units granted to grantees shall vest and become exercisable as to 25% of the total number
of restricted share units granted on the first anniversary of the vesting commencement date, and the remaining 25%,
25% and 25% of the total number of the restricted share units granted shall vest and become exercisable on the
second, third and fourth anniversaries of the vesting commencement date.
In addition to time-based vesting condition, the number of restricted share units which shall vest also depends
on the performance targets, including completion of public offering, commercialisation of products, local
manufacturing, total sales and net profit target achieved by the Group during the vesting period.
The following restricted share units were outstanding under the Equity Incentive Plan during the years ended
31 December 2023 and 2024:
Number of
restricted
share units
1 January 2023 7,642,500
Forfeited during 2023 (1,167,500)
As at 31 December 2023 and 1 January 2024 6,475,000
Forfeited during the year (20,000)
As at 31 December 2024 6,455,000
During the year ended 31 December 2024, share-based payment expenses of RMB32,773,000 were charged to
profit or loss. During the year ended 31 December 2023, share-based payment expenses of RMB12,266,000 were
credited to profit or loss mainly due to forfeiture of 1,167,500 restricted share units for retired and resigned
employees.
APPENDIX IIB UNAUDITED PRELIMINARY FINANCIAL INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 2024
– IIB-11 –


--- page 608 ---
15. RELATED PARTY TRANSACTIONS
(a) The Group had the following transactions with related parties during the year:
Y ear ended 31 December
2024 2023
RMB’000 RMB’000
Purchase of goods and cost sharing
Ascendis Pharma Endocrinology Division A/S (“Ascendis
Pharma Endocrinology”) (note i) 4,589 8,451
Ascendis Pharma Bone Diseases A/S (“Ascendis Pharma
Bone Diseases”) (note i) 3,310 451
Ascendis Pharma Growth Disorders A/S (“Ascendis Pharma
Growth Disorders”) (note i) – 243
7,899 9,145
Purchase of services
Ascendis Pharma Endocrinology 16,028 9,261
Ascendis Pharma Growth Disorders 9,060 3,059
Ascendis Pharma Bone Diseases 136 895
25,224 13,215
Loss from a discontinued procurement contract
Ascendis Pharma Endocrinology (note ii) – 109,006
The purchases of goods and services from the related parties were made according to the published prices and
conditions agreed by the Group and the related parties.
Notes:
i Ascendis Pharma Endocrinology, Ascendis Pharma Growth Disorders and Ascendis Pharma Bone
Diseases are wholly-owned subsidiaries of Ascendis Pharma A/S (“Ascendis Pharma”). Ascendis
Pharma had significant influence on the Group as at 31 December 2023 and 2024.
ii In August 2022, the Group entered into a commitment and prepayment agreement (the “Agreement”)
with Ascendis Pharma Endocrinology to purchase reserved drug substance. In September 2022, the
Group prepaid Euros (“EUR”) 10,000,000 (equivalent to RMB69,171,000) to Ascendis Pharma
Endocrinology and recorded prepayment of RMB69,171,000 as of 31 December 2022. In February 2023,
the Group exercised its right to cancel its commitment to purchase the reserved drug substance under
the Agreement due to the change of its commercial supply strategy. The total loss resulting from the
cancellation is EUR15,540,000 (equivalent to RMB109,006,000), comprised of (i) write-off of the
prepayment of EUR10,000,000 (equivalent to RMB69,171,000) and (ii) additional cancellation loss of
EUR5,540,000 (equivalent to RMB39,835,000) which was settled in December 2023.
APPENDIX IIB UNAUDITED PRELIMINARY FINANCIAL INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 2024
– IIB-12 –


--- page 609 ---
(b) Outstanding balances with related parties:
As at 31 December
2024 2023
RMB’000 RMB’000
Amounts due to related parties:
Trade payables
– Ascendis Pharma Endocrinology 3,900 230
– Ascendis Pharma Bone Diseases 3,229 –
– Ascendis Pharma Growth Disorders 3,152 109
10,281 339
Accrued expenses
– Ascendis Pharma Endocrinology 942 6,785
– Ascendis Pharma Bone Diseases – 401
– Ascendis Pharma Growth Disorders 180 1,265
1,122 8,451
11,403 8,790
Amounts advanced to a related party:
Current:
– Ascendis Pharma Endocrinology 7,802 9,367
Non-current:
– Ascendis Pharma Endocrinology 39,193 39,193
Amounts advanced to a related party were related to prepayments for purchase of goods or services which are
trade in nature, unsecured and non-interest-bearing.
Amounts due to related parties are trade in nature, unsecured, non-interest-bearing and repayable on demand.
The carrying amounts of amounts due to related parties as at the end of the reporting period approximated to their
fair values due to their short-term maturities.
16. EVENTS AFTER THE REPORTING PERIOD
(a) In February 2025, the Company allotted and issued 330,000 non-voting ordinary shares of the Company
under the Equity Incentive Plan to VP EIP US LIMITED in order to facilitate the administration of the
plan for no consideration. Meanwhile, the Company entered into share surrender agreement with VP EIP
NUS LIMITED, pursuant to which 765,000 non-voting ordinary shares of the Company were
surrendered and cancelled for no consideration.
(b) In March 2025, the Company granted restricted share units to certain grantees to subscribe for an
aggregate of 2,478,000 shares of the Company under the Equity Incentive Plan.
APPENDIX IIB UNAUDITED PRELIMINARY FINANCIAL INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 2024
– IIB-13 –


--- page 610 ---
MANAGEMENT’S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS
AND FINANCIAL CONDITION
Business Review
Founded in November 2018, we are a late-stage, near-commercialization
biopharmaceutical company focused on providing treatments in selected endocrinology
diseases in China (including Hong Kong, Macau and Taiwan). We have built a pipeline of three
drug candidates targeting selected endocrine diseases, all of which were in-licensed from our
collaboration partner, Ascendis Pharma. Our Core Product, lonapegsomatropin, is a once-
weekly long-acting growth hormone replacement therapy for the treatment of pediatric growth
hormone deficiency, a common short stature in patients aged under 18 caused by insufficient
growth hormone. TransCon CNP (navepegritide), one of our key drug candidates, is a
long-acting prodrug of c-type natriuretic peptide for the treatment of achondroplasia, a
short-limbed dwarfism which results in severe skeletal complications and comorbidities.
Palopegteriparatide, the other key drug candidate, is a once-daily parathyroid hormone
replacement therapy for the treatment of chronic hypoparathyroidism, a syndrome of abnormal
calcium and phosphorus metabolism caused by decreased secretion or defective function of
parathyroid hormone. Our Core Product, lonapegsomatropin, has completed the Phase 3 pivotal
trial in China for the treatment of PGHD; the BLA filing was made on January 18, 2024 and
subsequently accepted by the NMPA on March 7, 2024. As a pre-revenue biotech company, we
were not profitable and incurred operating losses in 2023 and 2024. In 2024, we had net loss
of RMB182.2 million, compared to a net loss of RMB249.6 million in 2023. Our operating
losses were primarily attributable to research and development expenses and administrative
expenses.
Future Plans and Prospects
To achieve our mission to become a leading biopharmaceutical company in developing
and commercializing endocrine therapies in China (including Hong Kong, Macau and Taiwan),
we intend to pursue the following strategies.
 rapidly advance the regulatory approval of our Core Product and the clinical
development and regulatory approval of other pipeline candidates;
 build commercialization capabilities backed by patient support and market access in
anticipation of the commercial launch of our Core Product and lay the foundation for
commercialization of future drug candidates;
 establish localized manufacturing capabilities to secure the supply of our Core
Product and future potential drug candidates in China (including Hong Kong, Macau
and Taiwan);
 expand the endocrine disease indications covered by our Core Product, two key drug
candidates, and new potential drugs based on transient conjugation technology
(TransCon);
APPENDIX IIB UNAUDITED PRELIMINARY FINANCIAL INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 2024
– IIB-14 –


--- page 611 ---
 further expand our pipeline portfolio through strategic in-licensing, collaborations
and partnerships for endocrine therapies looking to enter China (including Hong
Kong, Macau and Taiwan); and
 establish a recognized and leading franchise in endocrinology in China (including
Hong Kong, Macau and Taiwan).
Our Directors confirm that there has been no material adverse change in the financial or
trading position or prospects of our Group since December 31, 2024 and up to the date of this
document.
Discussion of Certain Key Items of the Consolidated Statement of Profit or Loss and
Other Comprehensive Income
The following table sets forth summary of our consolidated profit or loss items for the
years indicated.
Y ear ended December 31,
2024 2023
RMB’000 RMB’000
Other income 9,864 11,356
Other gains and losses, net 2,375 (106,695)
Research and development costs (90,521) (57,690)
Administrative expenses (86,434) (79,944)
Finance costs (161) (317)
Listing expenses (17,365) (16,280)
LOSS BEFORE TAX (182,242) (249,570)
Income tax expense – –
LOSS FOR THE YEAR (182,242) (249,570)
Other Income
Our other income decreased by 13.1% from RMB11.4 million in 2023 to RMB9.9 million
in 2024, primarily attributable to a decrease of RMB4.4 million in bank interest income as a
result of a decrease in our average bank deposit balance in 2024, partially offset by an increase
of RMB2.9 million in the government grants and other subsidies related to income.
APPENDIX IIB UNAUDITED PRELIMINARY FINANCIAL INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 2024
– IIB-15 –


--- page 612 ---
Other Gains and Losses, Net
We recorded net other gains of RMB2.4 million in 2024 as compared to net other losses
of RMB106.7 million in 2023, primarily due to the loss from a discontinued procurement
contract recorded in the amount of RMB109.0 million in relation to our cancellation of the
commitment to purchase the previously reserved drug substance under the commitment and
pre-payment agreement in February 2023.
Research and Development Costs
Our research and development costs increased by 56.9% from RMB57.7 million in 2023
to RMB90.5 million in 2024, primarily due to (i) the reversal of certain share-based payment
expenses of RMB29.3 million in 2023 mainly in relation to the retirement of relevant
employees in 2023; and (ii) an increase of costs related to Technology Transfer of RMB9.9
million in 2024 in line with the Technology Transfer progress.
Administrative Expenses
Our administrative expenses increased by 8.1% from RMB79.9 million in 2023 to
RMB86.4 million in 2024, primarily due to the reversal of certain share-based payment
expenses of RMB14.0 million in 2023 mainly in relation to the re-assessment of certain
milestone achievements under the Equity Incentive Plan, partially offset by a decrease in staff
remuneration costs of RMB10.4 million.
Finance Costs
Our finance costs remained relatively stable at RMB0.3 million and RMB0.2 million in
2023 and 2024, respectively.
Listing Expenses
Our listing expenses increased by 6.7% from RMB16.3 million in 2023 to RMB17.4
million in 2024, primarily due to the increased professional services provided by the Joint
Sponsors, legal counsels and other professional service providers in relation to the Listing.
Loss for the Y ear
As a result of the foregoing, our loss for the year decreased by 27.0% from RMB249.6
million in 2023 to RMB182.2 million in 2024.
APPENDIX IIB UNAUDITED PRELIMINARY FINANCIAL INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 2024
– IIB-16 –


--- page 613 ---
Discussion of Certain Key Items of the Consolidated Statement of Financial Position
Net Current Assets
The following table sets forth our current assets and current liabilities as of the dates
indicated:
As of December 31,
2024 2023
RMB’000 RMB’000
CURRENT ASSETS
Prepayments and other receivables 11,184 16,972
Amounts advanced to a related party 7,802 9,367
Cash and cash equivalents 203,587 347,782
Total current assets 222,573 374,121
CURRENT LIABILITIES
Trade and other payables 38,788 37,582
Deferred income – 2,900
Amounts due to related parties 11,403 8,790
Lease liabilities 1,997 2,552
Total current liabilities 52,188 51,824
Net current assets 170,385 322,297
Our net current assets decreased from RMB322.3 million as of December 31, 2023 to
RMB170.4 million as of December 31, 2024, primarily due to a decrease of RMB144.2 million
in cash and cash equivalents as a result of the operating costs associated with our research and
development (“R&D”) and administrative activities.
APPENDIX IIB UNAUDITED PRELIMINARY FINANCIAL INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 2024
– IIB-17 –


--- page 614 ---
Prepayments and Other Receivables
The following table sets forth a breakdown of our prepayments and other receivables as
of the dates indicated:
As of December 31,
2024 2023
RMB’000 RMB’000
Non-current:
V alue-added tax recoverable 20,536 16,137
Rental deposits 311 523
20,847 16,660
Current:
Prepayments for research and development
services 3,643 5,308
Deferred share issue costs 4,783 6,053
Other prepayments 457 824
Bank interest receivable 1,715 4,036
Rental deposits 532 697
Other receivables 54 54
11,184 16,972
Total 32,031 33,632
Our prepayments and other receivables decreased from RMB33.6 million as of December
31, 2023 to RMB32.0 million as of December 31, 2024, primarily due to (i) a decrease of
RMB2.3 million in bank interest receivable as a result of a decrease in our average bank
deposit balance in 2024; and (ii) a decrease of RMB1.7 million in prepayments for research and
development services in line with the progress of our R&D activities, partially offset by an
increase of RMB4.4 million in value-added tax recoverable mainly in relation to our operating
activities.
Cash and Cash Equivalents
Our cash and cash equivalents decreased from RMB347.8 million as of December 31,
2023 to RMB203.6 million as of December 31, 2024, primarily due to the operating costs
associated with our R&D and administrative activities.
APPENDIX IIB UNAUDITED PRELIMINARY FINANCIAL INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 2024
– IIB-18 –


--- page 615 ---
Amounts Advanced to a Related Party
Our amounts advanced to a related party, as non-current asset and of trade nature,
remained the same at RMB39.2 million as of December 31, 2023 and 2024.
Our amounts advanced to a related party, as current asset and of trade nature, decreased
from RMB9.4 million as of December 31, 2023 to RMB7.8 million as of December 31, 2024,
primarily because we received approximately RMB4.7 million worth of the materials prepaid
for R&D purposes in the fourth quarter of 2024.
Trade and Other Payables
The following table sets forth a breakdown of our trade and other payables as of the dates
indicated:
As of December 31,
2024 2023
RMB’000 RMB’000
Trade payables 835 669
Accrued expenses for research and development
services 9,316 8,078
Salary and discretionary bonus payables 12,100 13,316
Other payables 4,792 2,590
Accrued listing expenses 9,075 11,077
Other taxes payable 2,670 1,852
Total 38,788 37,582
Trade and other payables increased from RMB37.6 million as of December 31, 2023 to
RMB38.8 million as of December 31, 2024, primarily due to (i) an increase of RMB2.2 million
in other payables primarily attributable to the progress of land reclamation; and (ii) an increase
of RMB1.2 million in accrued expenses for research and development services in line with the
progress of our R&D activities, partially offset by a decrease of RMB2.0 million in accrued
listing expenses and a decrease of RMB1.2 million in salary and discretionary bonus payables.
APPENDIX IIB UNAUDITED PRELIMINARY FINANCIAL INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 2024
– IIB-19 –


--- page 616 ---
The following table sets forth an ageing analysis of our trade payables as of the dates
indicated, based on the invoice date:
As of December 31,
2024 2023
RMB’000 RMB’000
Within 3 months 835 669
Amounts Due to Related Parties
Our amounts due to related parties increased from RMB8.8 million as of December 31,
2023 to RMB11.4 million as of December 31, 2024, primarily due to an increase in the service
transaction amount with related parties in line with our R&D activities.
Indebtedness
The following table sets forth the breakdown of our indebtedness as of the dates
indicated:
As of December 31,
2024 2023
RMB’000 RMB’000
Current
Lease liabilities 1,997 2,552
Non-current
Lease liabilities 360 1,097
Total 2,357 3,649
APPENDIX IIB UNAUDITED PRELIMINARY FINANCIAL INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 2024
– IIB-20 –


--- page 617 ---
Key Financial Ratio
The following table sets forth the current ratio of our Group as of the dates indicated:
As of December 31,
2024 2023
Current ratio (1) 4.26 7.22
Note:
(1) Current ratio equals current assets divided by current liabilities as of the same date.
Our current ratio decreased from 7.22 as of December 31, 2023 to 4.26 as of December
31, 2024, mainly due to a decrease in our current assets from RMB374.1 million as of
December 31, 2023 to RMB222.6 million as of December 31, 2024, which was primarily due
to a decrease of RMB144.2 million in cash and cash equivalents as a result of the operating
costs associated with our R&D and administrative activities.
DISCLOSURE ABOUT MARKET RISK
See “Financial Information – Financial Risk Disclosure” in this prospectus for further
information.
CODE ON CORPORATE GOVERNANCE PRACTICES
Since we were not yet listed on the Stock Exchange during the year ended December 31,
2024, the Corporate Governance Code set forth in Appendix C1 to the Listing Rules was not
applicable to us during such period under review. After the Listing, we will comply with all the
code provisions set forth in the Corporate Governance Code.
REVIEW OF OUR PRELIMINARY FINANCIAL INFORMATION
The unaudited financial information in respect of our consolidated statement of financial
position, consolidated statement of profit or loss and other comprehensive income and the
related notes thereto for the year ended December 31, 2024 as set out in the 2024 Preliminary
Financial Information above have been agreed by the Reporting Accountants to the amounts set
out in our draft consolidated financial statements for the year ended December 31, 2024,
following their work under Practice Note 730 “Guidance for Auditors Regarding Preliminary
Announcement of Annual Results” issued by the Hong Kong Institute of Certified Public
Accountants. The work performed by the Reporting Accountants in this respect did not
constitute an assurance engagement in accordance with Hong Kong Standards on Auditing,
APPENDIX IIB UNAUDITED PRELIMINARY FINANCIAL INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 2024
– IIB-21 –


--- page 618 ---
Hong Kong Standards on Review Engagements or Hong Kong Standards on Assurance
Engagements issued by the Hong Kong Institute of Certified Public Accountants and
consequently no assurance has been expressed by the Reporting Accountants on the
Preliminary Financial Information.
PURCHASE, SALE OR REDEMPTION OF OUR COMPANY’S SHARES
Since we were not yet listed on the Stock Exchange during the year ended December 31,
2024, this disclosure requirement is not applicable to us.
APPENDIX IIB UNAUDITED PRELIMINARY FINANCIAL INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 2024
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--- page 619 ---
Set forth below is a summary of certain provisions of the Memorandum and Articles of
Association of our Company and certain aspects of Cayman Companies Law.
SUMMARY OF THE CONSTITUTION OF THE COMPANY
1. Memorandum of Association
The Memorandum of Association of the Company was conditionally adopted on March 8,
2025 and states, inter alia, that the liability of the members of the Company is limited, that the
objects for which the Company is established are unrestricted and the Company shall have full
power and authority to carry out any object not prohibited by the Companies Act or any other
law of the Cayman Islands.
The Memorandum of Association is available for inspection at the address specified in
Appendix V in the section headed “Documents Delivered to the Registrar of Companies in
Hong Kong and on Display.”
2. Articles of Association
The Articles of Association of the Company were conditionally adopted on March 8, 2025
and include provisions to the following effect:
2.1. Classes of Shares
The share capital of the Company consists of ordinary shares. The capital of the
Company at the date of adoption of the Articles is US$50,000 divided into 500,000,000
Shares of par value US$0.0001 each.
2.2. Directors
(a) Power to allot and issue Shares
Subject to the provisions of the Companies Act, the Memorandum of
Association and the Articles of Association, and to any special rights conferred on
the holders of any shares or class of shares, any share in the Company (whether
forming part of the present capital or not) may be issued with or have attached
thereto such rights or restrictions whether in regard to dividend, voting, return of
capital or otherwise as the Company may by ordinary resolution determine or, if
there has not been any such determination or so far as the same shall not make
specific provision, as the Board of Directors may determine. Subject to the
provisions of the Companies Act, the Listing Rules and the Memorandum of
Association and the Articles of Association, and to any special rights conferred on
the holders of any shares or attaching to any class of shares, shares may be issued
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on the terms that they may be, or at the option of the Company or the holder are,
liable to be redeemed on such terms and in such manner, including out of capital,
as the Board of Directors may deem fit.
(b) Power to dispose of the assets of the Company or any subsidiary
Subject to any exercise by the Board of the powers to appoint managers, the
management of the business of the Company shall be vested in the Board which, in
addition to the powers and authorities by the Articles of Association expressly
conferred upon it, may exercise all such powers and do all such acts and things as
may be exercised or done or approved by the Company and are not by the Articles
of Association or by the Companies Act expressly directed or required to be
exercised or done by the Company in general meeting, but subject nevertheless to
the provisions of the Companies Act and of the Articles of Association and to any
regulation from time to time made by the Company in general meeting not being
inconsistent with such provisions or the Articles of Association, provided that no
regulation so made shall invalidate any prior act of the Board which would have
been valid if such regulation had not been made.
The Board may from time to time appoint a general manager, manager or
managers of the Company and may fix his or their remuneration either by way of
salary or commission or by conferring the right to participation in the profits of the
Company or by a combination of two or more of these modes and pay the working
expenses of any of the staff of the general manager, manager or managers who may
be employed by him or them in connection with the conduct of the business of the
Company. The Board may enter into such agreement or agreements with any such
general manager, manager or managers upon such terms and conditions in all
respects as the Board may in its absolute discretion think fit, including a power for
such general manager, manager or managers to appoint an assistant manager or
managers or other employees whatsoever under them for the purpose of carrying on
the business of the Company.
(c) Compensation or payment for loss of office
Payment to any Director or past Director of any sum by way of compensation
for loss of office or as consideration for or in connection with his retirement from
office (not being a payment to which the Director is contractually entitled) must first
be approved by the Company in general meeting.
(d) Loans to Directors
There are provisions in the Articles of Association prohibiting the making of
loans to Directors or their respective close associates which are equivalent to the
restrictions imposed by the Companies Ordinance.
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(e) Financial assistance to purchase Shares
Subject to all applicable laws, the Company may give financial assistance to
Directors and employees of the Company, its subsidiaries or any holding company
or any subsidiary of such holding company in order that they may buy shares in the
Company or any such subsidiary or holding company, provided always that any such
financial assistance shall only be made in accordance with any relevant code, rules
or regulations issued by the Exchange or the Securities and Futures Commission of
Hong Kong from time to time in force.
(f) Disclosure of interest in contracts with the Company or any of its subsidiaries
Subject to the Companies Act and the Articles of Association, no Director or
proposed Director shall be disqualified by his or her office from contracting with the
Company either as vendor, purchaser or otherwise nor shall any such contract or any
contract or arrangement entered into by or on behalf of the Company with any
person, company or partnership of or in which any Director shall be a member or
otherwise interested be capable on that account of being avoided, nor shall any
Director so contracting or being any member or so interested be liable to account to
the Company for any profit so realised by any such contract or arrangement by
reason only of such Director holding that office or the fiduciary relationship thereby
established, provided that such Director shall, if his or her interest in such contract
or arrangement is material, declare the nature of his or her interest at the earliest
meeting of the Board at which it is practicable for him or her to do so, either
specifically or by way of a general notice stating that, by reason of the facts
specified in the notice, he or she is to be regarded as interested in any contracts of
a specified description which may subsequently be made by the Company.
A Director shall not be entitled to vote on (nor shall be counted in the quorum
in relation to) any resolution of the Board in respect of any contract or arrangement
or any other proposal whatsoever in which he or she or any of his or her Close
Associates has any material interest, and if he or she shall do so his or her vote shall
not be counted (nor is he to be counted in the quorum for the resolution), but this
prohibition shall not apply to any of the following matters, namely:
(i) the giving of any security or indemnity either:
(a) to the Director or his Close Associate(s) in respect of money lent by
him or any of them or obligations incurred or undertaken by him or
any of them at the request of or for the benefit of the Company or
any of its subsidiaries; or
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--- page 622 ---
(b) to a third party in respect of a debt or obligation of the Company or
any of its subsidiaries for which the Director or his Close
Associate(s) has himself/themselves assumed responsibility in
whole or in part and whether alone or jointly under a guarantee or
indemnity or by the giving of security;
(ii) any proposal concerning an offer of the shares, debentures or other
securities of or by the Company or any other company which the
Company may promote or be interested in for subscription or purchase
where the Director or his Close Associate(s) is/are or is/are to be
interested as a participant in the underwriting or sub-underwriting of the
offer;
(iii) any proposal concerning any other company in which the Director or his
Close Associate(s) is/are interested only, whether directly or indirectly, as
an officer or executive or shareholder or in which the Director or his
Close Associates are not in aggregate beneficially interested in 5% or
more of the issued shares of any class of such company (or of any third
company through which his interest or that of his Close Associates is
derived) or of the voting rights;
(iv) any proposal or arrangement concerning the benefit of employees of the
Company or our subsidiaries including:–
(a) the adoption, modification or operation of any employees’ share
scheme or any share incentive or share option scheme under which
the Director or his Close Associate(s) may benefit; or
(b) the adoption, modification or operation of a pension fund or
retirement, death or disability benefit scheme which relates both to
Director, his Close Associate(s) and employees of the Company or
of any of our subsidiaries and does not provide in respect of any
Director, or his Close Associate(s), as such any privilege or
advantage not generally accorded to the class of persons to which
such scheme or fund relates; and
(v) any contract or arrangement in which the Director or his Close
Associate(s) is/are interested in the same manner as other holders of
shares or debenture or other securities of the Company by virtue only of
his/their interest in shares or debentures or other securities of the
Company.
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--- page 623 ---
(g) Remuneration
The Directors shall be entitled to receive by way of ordinary remuneration for
their services such sum as shall from time to time be determined by the Company
in general meeting or by the Board, as the case may be, such sum (unless otherwise
directed by the resolution by which it is voted) to be divided amongst the Directors
in such proportions and in such manner as they may agree, or failing agreement,
equally, except that in such event any Director holding office for less than the whole
of the relevant period in respect of which the remuneration is paid shall only rank
in such division in proportion to the time during such period for which he has held
office. Such remuneration shall be in addition to any other remuneration to which a
Director who holds any salaried employment or office in the Company may be
entitled by reason of such employment or office.
The Directors shall be entitled to be paid all travelling, hotel and other
expenses, reasonably incurred by them in or about the performance of their duties
as Directors including their expenses of travelling to and from Board meetings,
committee meetings or general meetings or otherwise incurred whilst engaged on the
business of the Company or in the discharge of their duties as Directors.
The Board may grant special remuneration to any Director, who shall perform
any special or extra services to or at the request of the Company. Such special
remuneration may be made payable to such Director in addition to or in substitution
for his ordinary remuneration as a Director, and may be made payable by way of
salary, commission or participation in profits or otherwise as may be agreed.
The remuneration of the managing director, joint managing director, deputy
managing director or an executive director or a Director appointed to any other
office in the management of the Company may from time to time be fixed by the
Board and may be by way of salary, commission, or participation in profits or
otherwise or by all or any of those modes and with such other benefits (including
share option and/or pension and/or gratuity and/or other benefits on retirement) and
allowances as the Board may from time to time decide. Such remuneration shall be
in addition to such ordinary remuneration as the recipient may be entitled to receive
as a Director.
(h) Retirement, appointment and removal
The Board shall have power from time to time and at any time to appoint any
person as a Director either to fill a casual vacancy or as an addition to the Board.
Any Director so appointed shall hold office only until the first annual general
meeting of the Company after his appointment and shall then be eligible for
re-election at that meeting.
APPENDIX III SUMMARY OF THE CONSTITUTION OF OUR COMPANY
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--- page 624 ---
The members of the Company may by ordinary resolution at any time remove
any Director (including a Managing Director or other executive Director) before the
expiration of his term of office notwithstanding anything in the Articles of
Association or in any agreement between the Company and such Director and may
by ordinary resolution elect another person in his stead. Any person so elected shall
hold office during such time only as the Director in whose place he is elected would
have held the same if he had not been removed.
The Company may from time to time in general meeting by ordinary resolution
increase or reduce the number of Directors but so that the number of Directors shall
not be less than one. Subject to the provisions of the Articles of Association and the
Companies Act, the Company may also by ordinary resolution elect any person to
be a Director either to fill a casual vacancy or as an addition to the existing
Directors. No person shall, unless recommended by the Board, be eligible for
election to the office of Director at any general meeting unless during the period,
which shall be at least seven days, commencing no earlier than the day after the
despatch of the notice of the meeting appointed for such election and ending no later
than seven days prior to the date of such meeting, there has been given to the
Secretary notice in writing by a member of the Company (not being the person to
be proposed), entitled to attend and vote at the meeting for which such notice is
given, of his intention to propose such person for election and also notice in writing
signed by the person to be proposed of his willingness to be elected.
There is no shareholding qualification for Directors nor is there any specified
age limit for Directors.
The office of a Director shall be vacated:
(i) if he or she resigns his or her office by notice in writing to the Company
at its registered office or its principal office in Hong Kong;
(ii) if an order is made by any competent court or official on the grounds that
he or she is or may be suffering from mental disorder or is otherwise
incapable of managing his or her affairs and the Directors resolve that his
or her office be vacated;
(iii) if, without leave, he or she is absent from meetings of the Directors
(unless an alternate Director appointed by him or her attends) for 12
consecutive months, and the Directors resolve that his or her office be
vacated;
(iv) if he or she becomes bankrupt or has a receiving order made against him
or her or suspends payment or compounds with his or her creditors
generally;
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--- page 625 ---
(v) if he or she ceases to be or is prohibited from being a Director by law or
by virtue of any provision in the Articles of Association;
(vi) if he or she is removed from office by notice in writing served upon him
or her signed by not less than three-fourths in number (or, if that is not
a round number, the nearest lower round number) of the Directors
(including himself or herself) for the time being then in office; or
(vii) if he or she shall be removed from office by an ordinary resolution of the
members of the Company under the Articles of Association.
At every annual general meeting of the Company one-third of the Directors for
the time being (or, if their number is not three or a multiple of three, then the number
nearest to, but not less than, one-third) shall retire from office by rotation, provided
that every Director (including those appointed for a specific term) shall be subject
to retirement by rotation at least once every three years. The Directors to retire in
every year will be those who have been longest in office since their last election but
as between persons who became Directors on the same day those to retire shall
(unless they otherwise agree between themselves) be determined by lot. Any
Director appointed to fill a casual vacancy or as an addition to the existing Directors
shall not be taken into account in determining which Directors are to retire by
rotation. A retiring Director shall retain office until the close of the meeting at which
he or she retires and shall be eligible for re-election thereat. The Company at any
annual general meeting at which any Directors retire may fill the vacated office by
electing a like number of persons to be Directors.
(i) Borrowing powers
The Directors may from time to time at their discretion exercise all the powers
of the Company to raise or borrow or to secure the payment of any sum or sums of
money for the purposes of the Company and to mortgage or charge its undertaking,
property and assets (present and future) and uncalled capital or any part thereof.
(j) Proceedings of the Board
The Directors may meet together for the despatch of business, adjourn and
otherwise regulate their meetings and proceedings as they think fit in any part of the
world. Subject to limited exceptions, questions arising at any meeting shall be
determined by a majority of votes. In the case of an equality of votes, the chairman
of the meeting shall have a second or casting vote.
APPENDIX III SUMMARY OF THE CONSTITUTION OF OUR COMPANY
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--- page 626 ---
2.3. Alteration to constitutional documents
No alteration or amendment to the Memorandum or Articles of Association may be
made except by special resolution.
2.4. V ariation of rights of existing shares or classes of shares
Subject to the Companies Act, if at any time the share capital is divided into
different classes of shares, the rights attaching to the shares or any class of shares may
(unless otherwise provided by the terms of issue of the shares of that class) be varied or
abrogated only with the consent in writing of three-fourths of the voting rights of the
holders of that class, or with the sanction of a Special Resolution passed at a separate
general meeting of the holders of the shares of the class. To every such separate general
meeting the provisions of the Articles of Association relating to general meetings of the
Company shall mutatis mutandis apply, but so that:
(a) the necessary quorum (other than at an adjourned meeting) shall be two
persons (or in the case of a member being a corporation, its duly authorized
representative) holding or representing by proxy not less than one-third of the
issued shares of that class and at any adjourned meeting of such holders, two
holders present in person (or in the case of a member being a corporation, its
duly authorized representative) or by proxy (whatever the number of shares
held by them) shall be a quorum;
(b) every holder of shares of the class shall be entitled on a poll to one vote for
every such share held by him; and
(c) any holder of shares of the class present in person or by proxy or authorized
representative may demand a poll.
The special rights conferred upon the holders of the shares of any class issued with
preferred or other rights shall not, unless otherwise expressly provided by the terms of
issue of the shares of that class, be deemed to be varied or abrogated by the creation or
issue of further shares ranking pari passu therewith or by the redemption or purchase of
shares of any class by the Company.
2.5. Alteration of capital
The Company may, from time to time, whether or not all the shares for the time
being authorised shall have been issued and whether or not all the shares for the time
being issued shall have been fully paid up, by ordinary resolution, increase its share
capital by the creation of new shares, such new capital to be of such amount and to be
divided into shares of such respective amounts as the resolution shall prescribe.
APPENDIX III SUMMARY OF THE CONSTITUTION OF OUR COMPANY
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--- page 627 ---
The Company may from time to time by ordinary resolution:
(a) consolidate and divide all or any of its share capital into shares of larger or
smaller amount than its existing shares. On any consolidation of fully paid
shares and division into shares of larger amount, the Board may settle any
difficulty which may arise as it thinks expedient and in particular (but without
prejudice to the generality of the foregoing) may as between the holders of
shares to be consolidated determine which particular shares are to be
consolidated into each consolidated share, and if it shall happen that any
person shall become entitled to fractions of a consolidated share or shares, such
fractions may be sold by some person appointed by the Board for that purpose
and the person so appointed may transfer the shares so sold to the purchaser
thereof and the validity of such transfer shall not be questioned, and so that the
net proceeds of such sale (after deduction of the expenses of such sale) may
either be distributed among the persons who would otherwise be entitled to a
fraction or fractions of a consolidated share or shares rateably in accordance
with their rights and interests or may be paid to the Company for the
Company’s benefit;
(b) divide its shares into several classes and without prejudice to any special rights
previously conferred on the holders of existing shares attach thereto
respectively any preferential, deferred, qualified or special rights, privileges,
conditions or such restrictions which in the absence of any such determination
by the Company in general meeting, as the Directors may determine;
(c) cancel any shares which at the date of the passing of the resolution have not
been taken or agreed to be taken by any person, and diminish the amount of its
share capital by the amount of the shares so cancelled subject to the provisions
of the Companies Act;
(d) sub-divide its shares or any of them into shares of smaller amount than is fixed
by the Memorandum of Association of the Company, subject nevertheless to
the provisions of the Companies Act, and so that the resolution whereby any
share is sub-divided may determine that, as between the holders of the shares
resulting from such sub-division, one or more of the shares may have any such
preferred or other special rights, over, or may have such deferred rights or be
subject to any such restrictions as compared with the others as the Company
has power to attach to unissued or new shares; and
(e) convert all or any of its paid up shares into stock and reconvert that stock its
paid up shares of any denomination.
The Company may by Special Resolutions reduce its share capital or any capital
redemption reserve or any other undistributed reserve in any manner authorised and
subject to any conditions prescribed by the Companies Act. The Company may apply its
share premium account in any manner permitted by the Companies Act.
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2.6. Special resolution – majority required
A “special resolution” is defined in the Articles of Association to mean a resolution
passed by the Requisite Majority of such members as, being entitled to do so, vote in
person or, in the case of such members being corporations, by their respective duly
authorised representatives or, where proxies are allowed, by proxy at a general meeting
of the Company of which notice specifying the intention to propose the resolution as a
Special Resolution has been duly given in accordance with the Articles of Association and
where a poll is taken regard shall be had in computing a majority to the number of votes
to which each member is entitled, or a resolution approved in writing by all of the
members entitled to vote at a general meeting of the Company in one or more instruments
each signed by one or more of the members and the effective date of the Special
Resolution so adopted shall be the date on which the instrument or the last of such
instruments if more than one is executed. “Requisite Majority” means (a) with respect to
a Special Resolution to (i) amend the Memorandum and Articles of Association, (ii) to
approve the voluntary winding-up of the Company, and (iii) to approve a variation of the
rights attached to shares, a majority of at least three-fourths; and (b) with respect to all
other Special Resolutions, a majority of at least two-thirds.
In contrast, an “ordinary resolution” is defined in the Articles of Association to mean
a resolution passed by a simple majority of the votes of such members of the Company
as, being entitled to do so, vote in person or, in the case of corporations, by their duly
authorised representatives or, where proxies are allowed, by proxy at a general meeting
held in accordance with the Articles of Association and includes an ordinary resolution
approved in writing by all the members of the Company aforesaid.
2.7. V oting rights
Subject to any special rights, privileges or restrictions as to voting for the time being
attached to any class or classes of shares, at any general meeting on a show of hands every
member present in person (or, in the case of a member being a corporation, by its duly
authorised representative) or by proxy shall have one vote and on a poll every member
present in person (or, in the case of a member being a corporation, by its duly authorised
representative) or by proxy shall have one vote for every share of which he is the holder
which is fully paid or credited as fully paid (but so that no amount paid or credited as paid
on a share in advance of calls or installments is treated for the foregoing purposes as paid
on the share) for each share registered in his name in the register of members of the
Company. Notwithstanding anything contained in the Articles of Association, where more
than one proxy is appointed by a shareholder which is a clearing house (or its nominees),
each such proxy shall have one vote on a show of hands.
On a poll, a member or a proxy entitled to more than one vote need not use all his
votes or cast all his votes in the same way. Members of the Company must have the right
to: (a) speak at general meetings of the Company; and (b) vote at a general meeting except
where a member is required by the Listing Rules to abstain from voting to approve the
matter under consideration. An example of such a circumstance is where a member has
a material interest in the transaction or arrangement being voted upon.
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--- page 629 ---
Where any member is, under the Listing Rules, required to abstain from voting on
any particular resolution or restricted to voting only for or only against any particular
resolution, any votes cast by or on behalf of such member whether by proxy or, as the case
may be corporate representative in contravention of such requirement or restriction shall
not be counted.
Where there are joint registered holders of any share, any one of such persons may
vote at any meeting, either personally or by proxy, in respect of such share as if he were
solely entitled thereto; but if more than one of such joint holders be present at any
meeting personally or by proxy, that one of the said persons so present being the most or,
as the case may be, the more senior shall alone be entitled to vote in respect of the
relevant joint holding and, for this purpose, seniority shall be determined by reference to
the order in which the names of the joint holders stand on the register in respect of the
relevant joint holding.
A member in respect of whom an order has been made by any competent court or
official on the grounds that he is or may be suffering from mental disorder or is otherwise
incapable of managing his affairs may vote by any person authorised in such
circumstances to do so, and such person may vote by proxy.
Save as expressly provided in the Articles of Association or as otherwise determined
by the Board, no person other than a member duly registered and who shall have paid all
sums for the time being due from him payable to the Company in respect of his shares
shall be entitled to be present or to vote (save as proxy for another member), or to be
reckoned in a quorum, either personally or by proxy at any general meeting.
At any general meeting a resolution put to the vote of the meeting shall be decided
on a show of hands unless voting by way of a poll is required by the Listing Rules or
(before or on the declaration of the result of the show of hands or on the withdrawal of
any other demand for a poll) a poll is demanded:
(a) by the chairman of such meeting; or
(b) by at least three members present in person or in the case of a member being
a corporation by its duly authorised representative or by proxy for the time
being entitled to vote at the meeting; or
(c) by a member or members present in person or in the case of a member being
a corporation by its duly authorised representative or by proxy and
representing not less than one-tenth of the total voting rights of all members
having the right to vote at the meeting; or
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--- page 630 ---
(d) by a member or members present in person or in the case of a member being
a corporation by its duly authorised representative or by proxy and holding
shares in the Company conferring a right to vote at the meeting being shares
on which an aggregate sum has been paid up equal to not less than one-tenth
of the total sum paid up on all shares conferring that right; or
(e) if required by the Listing Rules, by any Director or Directors who, individually
or collectively, hold proxies in respect of shares representing five per cent. or
more of the total voting rights at such meeting.
A demand by a person as proxy for a member or in the case of a member being a
corporation by its duly authorised representative shall be deemed to be the same as a
demand by a member.
Notwithstanding any other provision of the Articles of Association, where that
shareholder is a recognised clearing house (within the meaning of the Securities and
Futures Ordinance) or its nominee(s), it may authorise such person or persons as it thinks
fit to act as its representative(s) or proxy(ies) at any shareholders’ meetings or any
meetings of any class of shareholders provided that, if more than one person is so
authorised, the authorisation or proxy form must specify the number and class of shares
in respect of which each such representative is so authorised. Each person so authorised
will be deemed to have been duly authorised without the need of producing any
documents of title, notarised authorisation and/or further evidence for substantiating the
facts that it is duly authorised and will be entitled to exercise the same power on behalf
of the recognised clearing house as that clearing house or its nominee(s) could exercise
if it were an individual shareholder of the Company.
2.8. Annual general meetings and extraordinary general meetings
The Company shall in each financial year hold a general meeting as its annual
general meeting in addition to any other meeting in that year and shall specify the meeting
as such in the notices calling it. So long as the first annual general meeting of the
Company is held within 18 months of its incorporation, it need not be held in the year of
its incorporation or in the following years. The annual general meeting shall be held at
such time and place as the Board shall appoint.
The Board may, whenever it thinks fit, convene an extraordinary general meeting.
General meetings shall also be convened and resolutions may be added to a meeting
agenda on the written requisition of any two or more members of the Company deposited
at the principal office of the Company in Hong Kong or, in the event the Company ceases
to have such a principal office, the registered office specifying the objects of the meeting
and signed by the requisitionists, provided that such requisitionists held as at the date of
deposit of the requisition not less than one-tenth of the paid up capital of the Company
which carries the right of voting at general meetings of the Company, on a one vote per
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share basis in the share capital of the Company. General meetings may also be convened
on the written requisition of any one member of the Company which is a recognised
clearing house (or its nominee(s)) deposited at the principal office of the Company in
Hong Kong or, in the event the Company ceases to have such a principal office, the
registered office specifying the objects of the meeting and signed by the requisitionist,
provided that such requisitionist held as at the date of deposit of the requisition not less
than one-tenth of the paid up capital of the Company which carries the right of voting at
general meetings of the Company. If the Board does not within 21 days from the date of
deposit of the requisition proceed duly to convene the meeting to be held within a further
21 days, the requisitionist(s) themselves or any of them representing more than one-half
of the total voting rights of all of them, may convene the general meeting in the same
manner, as nearly as possible, as that in which meetings may be convened by the Board
provided that any meeting so convened shall not be held after the expiration of three
months from the date of deposit of the requisition, and all reasonable expenses incurred
by the requisitionist(s) as a result of the failure of the Board shall be reimbursed to them
by the Company.
2.9. Accounts and audit
The Board shall cause to be kept such books of account as are necessary to give a
true and fair view of the state of the Company’s affairs and to show and explain its
transactions and otherwise in accordance with the Companies Act. The Board shall cause
all such books of account to be retained for a minimum period of five years from the date
of which they are prepared.
The Board shall from time to time determine whether, to what extent, at what times
and places and under what conditions or regulations, the accounts and books of the
Company, or any of them, shall be open to the inspection of the members (other than
officers of the Company) and no member shall have any right of inspecting any accounts
or books or documents of the Company except as conferred by the Companies Act or any
other relevant law or regulation or as authorised by the Board or by the Company in
general meeting.
The Board shall, commencing with the first annual general meeting, cause to be
prepared and to be laid before the members of the Company at every annual general
meeting a profit and loss account for the period, in the case of the first account, since the
incorporation of the Company and, in any other case, since the preceding account,
together with a balance sheet as at the date to which the profit and loss account is made
up and a Directors’ report with respect to the profit or loss of the Company for the period
covered by the profit and loss account and the state of the Company’s affairs as at the end
of such period, an Auditors’ report on such accounts prepared pursuant to the Articles of
Association and such other reports and accounts as may be required by law. Copies of
those documents to be laid before the members of the Company at an annual general
meeting shall not less than 21 days before the date of the meeting be sent in the manner
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in which notices may be served by the Company as provided herein to every member of
the Company and every holder of debentures of the Company, provided that the Company
shall not be required to send copies of those documents to any person of whose address
the Company is not aware or to more than one of the joint holders of any shares or
debentures.
2.10. Auditors
The Company shall at each annual general meeting appoint one or more firms of
auditors to hold office until the conclusion of the next annual general meeting on such
terms and with such duties as may be agreed with the Board, but if an appointment is not
made, the Auditors in office shall continue in office until a successor is appointed. A
Director, officer or employee of any such Director, officer or employee shall not be
appointed as Auditors of the Company. The Board may fill any casual vacancy in the
office of Auditors but while any such vacancy continues the surviving or continuing
Auditors (if any) may act. The appointment, removal and remuneration of the Auditors
must be approved by a majority of the Company’s members in the annual general meeting
except that in any particular year the Company in general meeting may delegate the fixing
of such remuneration to the Board and the remuneration of any Auditors appointed to fill
any casual vacancy may be fixed by the Board.
The members may, at any general meeting convened and held in accordance with
these Articles, remove the Auditors by Special Resolution at any time before the
expiration of the term of office and shall, by ordinary resolution, at that meeting appoint
new auditors in its place for the remainder of the term.
2.11. Notice of meetings and business to be conducted thereat
An annual general meeting and any extraordinary general meeting called for the
passing of a Special Resolution shall be called by not less than 21 days’ notice in writing
and any other extraordinary general meeting shall be called by not less than 14 days’
notice in writing. Subject to the requirement under the Listing Rules, the notice shall be
inclusive of the day on which it is served or deemed to be served and of the day for which
it is given, and shall specify the time, place, and agenda of the meeting, particulars of the
resolutions to be considered at the meeting and in the case of special business (as defined
in the Articles of Association) the general nature of that business. The notice convening
an annual general meeting shall specify the meeting as such, and the notice convening a
meeting to pass a Special Resolution shall specify the intention to propose the resolution
as a Special Resolution. Notice of every general meeting shall be given to the Auditors
and to all members other than such as, under the provisions hereof or the terms of issue
of the shares they hold, are not entitled to receive such notice from the Company.
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Notwithstanding that a meeting of the Company is called by shorter notice than that
mentioned above, it shall be deemed to have been duly called if it is so agreed:
(a) in the case of a meeting called as an annual general meeting, by all members
of the Company entitled to attend and vote thereat or their proxies; and
(b) in the case of any other meeting, by a majority in number of the members
having a right to attend and vote at the meeting, being a majority together
holding not less than 95% in nominal value of the shares giving that right.
If, after the notice of a general meeting has been sent but before the meeting is held,
or after the adjournment of a general meeting but before the adjourned meeting is held
(whether or not notice of the adjourned meeting is required), the Directors, in their
absolute discretion, consider that it is impractical or unreasonable for any reason to hold
a general meeting on the date or at the time and place specified in the notice calling such
meeting, it may change or postpone the meeting to another date, time and place.
The Directors also have the power to provide in every notice calling a general
meeting that in the event of a gale warning or a black rainstorm warning is in force at any
time on the day of the general meeting (unless such warning is cancelled at least a
minimum period of time prior to the general meeting as the Directors may specify in the
relevant notice), the meeting shall be postponed without further notice to be reconvened
on a later date. Where a general meeting is so postponed, the Company shall endeavour
to cause a notice of such postponement to be placed on the Company’s website and
published on the Stock Exchange’s website as soon as practicable, but failure to place or
publish such notice shall not affect the automatic postponement of such meeting.
Where a general meeting is postponed:
(a) the Directors shall fix the date, time and place for the reconvened meeting and
at least seven clear days’ notice shall be given for the reconvened meeting; and
such notice shall specify the date, time and place at which the postponed
meeting will be reconvened and the date and time by which proxies shall be
submitted in order to be valid at such reconvened meeting (provided that any
proxy submitted for the original meeting shall continue to be valid for the
reconvened meeting unless revoked or replaced by a new proxy); and
(b) notice of the business to be transacted at the reconvened meeting shall not be
required, nor shall any accompanying documents be required to be
recirculated, provided that the business to be transacted at the reconvened
meeting is the same as that set out in the notice of the original meeting
circulated to the members of the Company.
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2.12. Transfer of shares
Any member may transfer all or any of his shares by an instrument of transfer in the
usual or common form or in a form prescribed by the Exchange or in any other form
approved by the Board and may be under hand or, if the transferor or transferee is a
clearing house or its nominee(s), by hand or by machine imprinted signature or by such
other manner of execution as the Board may approve from time to time.
The instrument of transfer shall be executed by or on behalf of the transferor and the
transferee provided that the Board of Directors may dispense with the execution of the
instrument of transfer by the transferee in any case which it thinks fit in its discretion to
do so. The transferor shall be deemed to remain the holder of the share until the name of
the transferee is entered in the register of members in respect thereof. Notwithstanding
the foregoing, transfers of shares which are listed on the Exchange may be effected by any
method of transferring or dealing in securities permitted by the Listing Rules and which
has been approved by the Board for such purpose.
Fully paid Shares shall be free from any restriction with respect to the right of the
holder thereof to transfer such Shares (except when permitted by the Exchange). The
Board of Directors may, in its absolute discretion, and without giving any reason therefor,
refuse to register a transfer of any share (not being a fully paid up share) to a person of
whom it does not approve, or any share issued under any share incentive scheme for
employees upon which a restriction on transfer imposed thereby still subsists, and it may
also, without prejudice to the foregoing generality, refuse to register a transfer of any
share to more than four joint holders or a transfer of any share (not being a fully paid up
share) on which the Company has a lien.
The Directors may also decline to register any transfer of any shares unless:
(a) the instrument of transfer is lodged with the Company accompanied by the
certificate for the shares to which it relates (which shall upon registration of
the transfer be cancelled) and such other evidence as the Board may reasonably
require to show the right of the transferor to make the transfer;
(b) the instrument of transfer is in respect of only one class of shares;
(c) the instrument of transfer is properly stamped (in circumstances where
stamping is required); and
(d) a fee of such maximum as the Exchange may from time to time determine to
be payable (or such lesser sum as the Board may from time to time require) is
paid to the Company in respect thereof.
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If the Directors refuse to register a transfer of any share they shall, within two
months after the date on which the transfer was lodged with the Company, send to each
of the transferor and the transferee notice of such refusal.
The registration of transfers may, on 10 business days’ notice (or on 6 business days’
notice in the case of a rights issue) being given by advertisement published on the Stock
Exchange’s website, or, subject to the Listing Rules, by electronic communication in the
manner in which notices may be served by the Company by electronic means as provided
in the Articles of Association or by advertisement published in the newspapers, be
suspended and the register of members of the Company closed at such times for such
periods as the Directors may from time to time determine, provided that the registration
of transfers shall not be suspended or the register closed for more than 30 days in any year
(or such longer period as the members of the Company may by ordinary resolution
determine provided that such period shall not be extended beyond 60 days in any year).
2.13. Power of the Company to purchase its own shares
The Company is empowered by the Companies Act and the Articles of Association
to purchase its own shares subject to certain restrictions and the Directors may only
exercise this power on behalf of the Company subject to the authority of its members in
general meeting as to the manner in which they do so and to any applicable requirements
imposed from time to time by the Stock Exchange and the Securities and Futures
Commission of Hong Kong. Shares which have been repurchased will be treated as
cancelled upon the repurchase, or held by the Company as treasury shares.
2.14. Power of any subsidiary of the Company to own shares
There are no provisions in the Articles of Association relating to the ownership of
shares by a subsidiary.
2.15. Dividends and other methods of distribution
Subject to the Companies Act and the Articles of Association, the Company in
general meeting may declare dividends in any currency but no dividends shall exceed the
amount recommended by the Directors. No dividend may be declared or paid other than
out of profits and reserves of the Company lawfully available for distribution, including
share premium.
Unless and to the extent that the rights attached to any shares or the terms of issue
thereof otherwise provide, all dividends shall (as regards any shares not fully paid
throughout the period in respect of which the dividend is paid) be apportioned and paid
pro rata according to the amounts paid up on the shares during any portion or portions of
the period in respect of which the dividend is paid. For these purposes, no amount paid
up on a share in advance of calls shall be treated as paid up on the share.
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The Directors may from time to time pay to the members of the Company such
interim dividends as appear to the Directors to be justified by the profits of the Company.
The Directors may also pay half-yearly or at other intervals to be selected by them any
dividend which may be payable at a fixed rate if they are of the opinion that the profits
available for distribution justify the payment.
The Directors may retain any dividends or other monies payable on or in respect of
a share upon which the Company has a lien, and may apply the same in or towards
satisfaction of the debts, liabilities or engagements in respect of which the lien exists. The
Directors may also deduct from any dividend or other monies payable to any member of
the Company all sums of money (if any) presently payable by him or her to the Company
on account of calls, instalments or otherwise.
No dividend shall carry interest against the Company.
Whenever the Directors or the Company in general meeting have resolved that a
dividend be paid or declared on the share capital of the Company, the Directors may
further resolve: (a) that such dividend be satisfied wholly or in part in the form of an
allotment of shares credited as fully paid up on the basis that the shares so allotted are
to be of the same class as the class already held by the allottee, provided that the members
of the Company entitled thereto will be entitled to elect to receive such dividend (or part
thereof) in cash in lieu of such allotment; or (b) that the members of the Company entitled
to such dividend will be entitled to elect to receive an allotment of shares credited as fully
paid up in lieu of the whole or such part of the dividend as the Directors may think fit
on the basis that the shares so allotted are to be of the same class as the class already held
by the allottee. The Company may upon the recommendation of the Directors by ordinary
resolution resolve in respect of any one particular dividend of the Company that
notwithstanding the foregoing a dividend may be satisfied wholly in the form of an
allotment of shares credited as fully paid without offering any right to members of the
Company to elect to receive such dividend in cash in lieu of such allotment.
Any dividend, interest or other sum payable in cash to a holder of shares may be paid
by cheque or warrant sent through the post addressed to the registered address of the
member of the Company entitled, or in the case of joint holders, to the registered address
of the person whose name stands first in the register of members of the Company in
respect of the joint holding or to such person and to such address as the holder or joint
holders may in writing direct. Every cheque or warrant so sent shall be made payable to
the order of the holder or, in the case of joint holders, to the order of the holder whose
name stands first on the register of members of the Company in respect of such shares,
and shall be sent at his, her or their risk and the payment of any such cheque or warrant
by the bank on which it is drawn shall operate as a good discharge to the Company in
respect of the dividend and/or bonus represented thereby, notwithstanding that it may
subsequently appear that the same has been stolen or that any endorsement thereon has
been forged. The Company may cease sending such cheques for dividend entitlements or
dividend warrants by post if such cheques or warrants have been left uncashed on two
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consecutive occasions. However, the Company may exercise its power to cease sending
cheques for dividend entitlements or dividend warrants after the first occasion on which
such a cheque or warrant is returned undelivered. Any one of two or more joint holders
may give effectual receipts for any dividends or other monies payable or property
distributable in respect of the shares held by such joint holders.
Any dividend unclaimed for six years from the date of declaration of such dividend
may be forfeited by the Directors and shall revert to the Company.
The Directors may, with the sanction of the members of the Company in general
meeting, direct that any dividend be satisfied wholly or in part by the distribution of
specific assets of any kind, and in particular of paid up shares, debentures or warrants to
subscribe securities of any other company, and where any difficulty arises in regard to
such distribution the Directors may settle it as they think expedient, and in particular may
disregard fractional entitlements, round the same up or down or provide that the same
shall accrue to the benefit of the Company, and may fix the value for distribution of such
specific assets and may determine that cash payments shall be made to any members of
the Company upon the footing of the value so fixed in order to adjust the rights of all
parties, and may vest any such specific assets in trustees as may seem expedient to the
Directors.
2.16. Proxies
Any member of the Company entitled to attend and vote at a meeting of the
Company shall be entitled to appoint another person who must be an individual as his or
her proxy to attend and vote instead of him or her and a proxy so appointed shall have
the same right as the member to speak at the meeting. A proxy need not be a member of
the Company.
Instruments of proxy shall be in common form or in such other form as the Directors
may from time to time approve provided that it shall enable a member to instruct his or
her proxy to vote in favour of or against (or in default of instructions or in the event of
conflicting instructions, to exercise his or her discretion in respect of) each resolution to
be proposed at the meeting to which the form of proxy relates. The instrument of proxy
shall be deemed to confer authority to vote on any amendment of a resolution put to the
meeting for which it is given as the proxy thinks fit. The instrument of proxy shall, unless
the contrary is stated therein, be valid as well for any adjournment of the meeting as for
the meeting to which it relates provided that the meeting was originally held within 12
months from such date.
The instrument appointing a proxy shall be in writing under the hand of the
appointor or his or her attorney authorised in writing or if the appointor is a corporation
either under its seal or under the hand of an officer, attorney or other person authorised
to sign the same.
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The instrument appointing a proxy and (if required by the Directors) the power of
attorney or other authority (if any) under which it is signed, or a notarially certified copy
of such power or authority, shall be delivered at the registered office of the Company (or
at such other place as may be specified in the notice convening the meeting or in any
notice of any adjournment or, in either case, in any document sent therewith) not less than
48 hours before the time appointed for holding the meeting or adjourned meeting at which
the person named in the instrument proposes to vote or, in the case of a poll taken
subsequently to the date of a meeting or adjourned meeting, not less than 48 hours before
the time appointed for the taking of the poll and in default the instrument of proxy shall
not be treated as valid. No instrument appointing a proxy shall be valid after the
expiration of 12 months from the date named in it as the date of its execution. Delivery
of any instrument appointing a proxy shall not preclude a member of the Company from
attending and voting in person at the meeting or poll concerned and, in such event, the
instrument appointing a proxy shall be deemed to be revoked.
Notwithstanding any other provision of the Articles of Association, where that
shareholder is a recognised clearing house (within the meaning of the Securities and
Futures Ordinance) or its nominee(s), it may authorise such person or persons as it thinks
fit to act as its representative(s) or proxy(ies) at any shareholders’ meetings or any
meetings of any class of shareholders provided that, if more than one person is so
authorised, the authorisation or proxy form must specify the number and class of shares
in respect of which each such representative is so authorised. Each person so authorised
will be deemed to have been duly authorised without the need of producing any
documents of title, notarised authorisation and/or further evidence for substantiating the
facts that it is duly authorised and will be entitled to exercise the same power on behalf
of the recognised clearing house as that clearing house or its nominee(s) could exercise
if it were an individual shareholder of the Company.
2.17. Calls on shares and forfeiture of shares
The Directors may from time to time make calls upon the members of the Company
in respect of any monies unpaid on their shares (whether on account of the nominal
amount of the shares or by way of premium or otherwise) and not by the conditions of
allotment thereof made payable at fixed times and each member of the Company shall
(subject to the Company serving upon him or her at least 14 days’ notice specifying the
time and place of payment and to whom such payment shall be made) pay to the person
at the time and place so specified the amount called on his or her shares. A call may be
revoked or postponed as the Directors may determine. A person upon whom a call is made
shall remain liable on such call notwithstanding the subsequent transfer of the shares in
respect of which the call was made.
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A call may be made payable either in one sum or by instalments and shall be deemed
to have been made at the time when the resolution of the Directors authorising the call
was passed. The joint holders of a share shall be jointly and severally liable to pay all
calls and instalments due in respect of such share or other monies due in respect thereof.
If a sum called in respect of a share shall not be paid before or on the day appointed
for payment thereof, the person from whom the sum is due shall pay interest on the sum
from the day appointed for payment thereof to the time of actual payment at such rate, not
exceeding 20% per annum, as the Directors may determine, but the Directors shall be at
liberty to waive payment of such interest wholly or in part.
If any call or instalment of a call remains unpaid on any share after the day
appointed for payment thereof, the Directors may at any time during such time as any part
thereof remains unpaid serve a notice on the holder of such shares requiring payment of
so much of the call or instalment as is unpaid together with any interest which may be
accrued and which may still accrue up to the date of actual payment.
The notice shall name a further day (not being less than 14 days from the date of
service of the notice) on or before which, and the place where, the payment required by
the notice is to be made, and shall state that in the event of non-payment at or before the
time and at the place appointed, the shares in respect of which such call was made or
instalment is unpaid will be liable to be forfeited.
If the requirements of such notice are not complied with, any share in respect of
which such notice has been given may at any time thereafter, before payment of all calls
or instalments and interest due in respect thereof has been made, be forfeited by a
resolution of the Directors to that effect. Such forfeiture shall include all dividends and
bonuses declared in respect of the forfeited shares and not actually paid before the
forfeiture. A forfeited share shall be deemed to be the property of the Company and may
be re-allotted, sold or otherwise disposed of.
A person whose shares have been forfeited shall cease to be a member of the
Company in respect of the forfeited shares but shall, notwithstanding the forfeiture,
remain liable to pay to the Company all monies which at the date of forfeiture were
payable by him or her to the Company in respect of the shares, together with (if the
Directors shall in their discretion so require) interest thereon at such rate not exceeding
20% per annum as the Directors may prescribe from the date of forfeiture until payment,
and the Directors may enforce payment thereof without being under any obligation to
make any allowance for the value of the shares forfeited, at the date of forfeiture.
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2.18. Inspection of register of members
The register of members of the Company shall be kept in such manner as to show
at all times the members of the Company for the time being and the shares respectively
held by them. The register may, on 10 business days’ notice (or on 6 business days’ notice
in the case of a rights issue) being given by advertisement published on the Stock
Exchange’s website, or, subject to the Listing Rules, by electronic communication in the
manner in which notices may be served by the Company by electronic means as provided
in the Articles of Association or by advertisement published in the newspapers, be closed
at such times and for such periods as the Directors may from time to time determine either
generally or in respect of any class of shares, provided that the register shall not be closed
for more than 30 days in any year (or such longer period as the members of the Company
may by ordinary resolution determine provided that such period shall not be extended
beyond 60 days in any year).
Any register of members kept in Hong Kong shall during normal business hours
(subject to such reasonable restrictions as the Directors may impose) be open to
inspection by any member of the Company without charge and by any other person on
payment of fee not exceeding HK$2.50 (or such higher amount as may from time to time
be permitted under the Listing Rules) as the Directors may determine for each inspection.
2.19. Quorum for meetings and separate class meetings
No business shall be transacted at any general meeting unless a quorum is present
when the meeting proceeds to business, but the absence of a quorum shall not preclude
the appointment, choice or election of a chairman which shall not be treated as part of the
business of the meeting.
Two members of the Company present in person or by proxy shall be a quorum
provided always that if the Company has only one member of record the quorum shall be
that one member present in person or by proxy.
A corporation being a member of the Company shall be deemed for the purpose of
the Articles of Association to be present in person if represented by its duly authorised
representative being the person appointed by resolution of the directors or other
governing body of such corporation or by power of attorney to act as its representative
at the relevant general meeting of the Company or at any relevant general meeting of any
class of members of the Company.
The quorum for a separate general meeting of the holders of a separate class of
shares of the Company is described in paragraph 2.4 above.
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2.20. Rights of minorities in relation to fraud or oppression
There are no provisions in the Articles of Association concerning the rights of
minority shareholders in relation to fraud or oppression.
2.21. Procedure on liquidation
If the Company shall be wound up, and the assets available for distribution amongst
the members of the Company as such shall be insufficient to repay the whole of the
paid-up capital, such assets shall be distributed so that, as nearly as may be, the losses
shall be borne by the members of the Company in proportion to the capital paid up, or
which ought to have been paid up, at the commencement of the winding up on the shares
held by them respectively. If in a winding up the assets available for distribution amongst
the members of the Company shall be more than sufficient to repay the whole of the
capital paid up at the commencement of the winding up, the excess shall be distributed
amongst the members of the Company in proportion to the capital paid up at the
commencement of the winding up on the shares held by them respectively. The foregoing
is without prejudice to the rights of the holders of shares issued upon special terms and
conditions.
If the Company shall be wound up, the liquidator may with the sanction of a special
resolution of the Company and any other sanction required by the Companies Act, divide
amongst the members of the Company in specie or kind the whole or any part of the assets
of the Company (whether they shall consist of property of the same kind or not) and may,
for such purpose, set such value as he or she deems fair upon any property to be divided
as aforesaid and may determine how such division shall be carried out as between the
members or different classes of members of the Company. The liquidator may, with the
like sanction, vest the whole or any part of such assets in trustees upon such trusts for the
benefit of the members of the Company as the liquidator, with the like sanction and
subject to the Companies Act, shall think fit, but so that no member of the Company shall
be compelled to accept any assets, shares or other securities in respect of which there is
a liability.
2.22. Untraceable members
The Company shall be entitled to sell any shares of a member of the Company or
the shares to which a person is entitled by virtue of transmission on death or bankruptcy
or operation of law if: (a) all cheques or warrants, not being less than three in number,
for any sums payable in cash to the holder of such shares have remained uncashed for a
period of 12 years; (b) the Company has not during that time or before the expiry of the
three-month period referred to in (d) below received any indication of the whereabouts or
existence of the member; (c) during the 12-year period, at least three dividends in respect
of the shares in question have become payable and no dividend during that period has
been claimed by the member; and (d) upon expiry of the 12-year period, the Company has
caused an advertisement to be published in the newspapers or subject to the Listing Rules,
by electronic communication in the manner in which notices may be served by the
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Company by electronic means as provided in the Articles of Association, giving notice of
its intention to sell such shares and a period of three months has elapsed since such
advertisement and the Stock Exchange has been notified of such intention. The net
proceeds of any such sale shall belong to the Company and upon receipt by the Company
of such net proceeds it shall become indebted to the former member for an amount equal
to such net proceeds.
SUMMARY OF CAYMAN ISLANDS COMPANIES ACT AND TAXATION
1. Introduction
The Companies Act is derived, to a large extent, from the older Companies Acts of
England, although there are significant differences between the Companies Act and the current
Companies Act of England. Set out below is a summary of certain provisions of the Companies
Act, although this does not purport to contain all applicable qualifications and exceptions or
to be a complete review of all matters of corporate law and taxation which may differ from
equivalent provisions in jurisdictions with which interested parties may be more familiar.
2. Incorporation
The Company was incorporated in the Cayman Islands as an exempted company with
limited liability on 1 November 2018 under the Companies Act. As such, its operations must
be conducted mainly outside the Cayman Islands. The Company is required to file an annual
return each year with the Registrar of Companies of the Cayman Islands and pay a fee which
is based on the size of its authorised share capital.
3. Share Capital
The Companies Act permits a company to issue ordinary shares, preference shares,
redeemable shares or any combination thereof.
The Companies Act provides that where a company issues shares at a premium, whether
for cash or otherwise, a sum equal to the aggregate amount of the value of the premia on those
shares shall be transferred to an account called the “share premium account.” At the option of
a company, these provisions may not apply to premia on shares of that company allotted
pursuant to any arrangement in consideration of the acquisition or cancellation of shares in any
other company and issued at a premium. The Companies Act provides that the share premium
account may be applied by a company, subject to the provisions, if any, of its memorandum and
articles of association, in such manner as the company may from time to time determine
including, but without limitation:
(a) paying distributions or dividends to members;
(b) paying up unissued shares of the company to be issued to members as fully paid
bonus shares;
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(c) in the redemption and repurchase of shares (subject to the provisions of section 37
of the Companies Act);
(d) writing-off the preliminary expenses of the company;
(e) writing-off the expenses of, or the commission paid, or discount allowed on, any
issue of shares or debentures of the company; and
(f) providing for the premium payable on redemption or purchase of any shares or
debentures of the company.
No distribution or dividend may be paid to members out of the share premium account
unless immediately following the date on which the distribution or dividend is proposed to be
paid the company will be able to pay its debts as they fall due in the ordinary course of
business.
The Companies Act provides that, subject to confirmation by the Grand Court of the
Cayman Islands, a company limited by shares or a company limited by guarantee and having
a share capital may, if so authorised by its articles of association, by special resolution reduce
its share capital in any way.
Subject to the detailed provisions of the Companies Act, a company limited by shares or
a company limited by guarantee and having a share capital may, if so authorised by its articles
of association, issue shares which are to be redeemed or are liable to be redeemed at the option
of the company or a shareholder. In addition, such a company may, if authorised to do so by
its articles of association, purchase its own shares, including any redeemable shares. However,
if the articles of association do not authorize the manner of purchase, a company cannot
purchase any of its own shares unless the manner of purchase has first been authorised by an
ordinary resolution of the company. The articles of association may provide that the manner of
purchase may be determined by the directors of the company. At no time may a company
redeem or purchase its shares unless they are fully paid. A company may not redeem or
purchase any of its shares if, as a result of the redemption or purchase, there would no longer
be any member of the company holding shares. A payment out of capital by a company for the
redemption or purchase of its own shares is not lawful unless immediately following the date
on which the payment is proposed to be made, the company shall be able to pay its debts as
they fall due in the ordinary course of business.
There is no statutory restriction in the Cayman Islands on the provision of financial
assistance by a company to another person for the purchase of, or subscription for, its own or
its holding company’s shares. Accordingly, a company may provide financial assistance if the
directors of the company consider, in discharging their duties of care and to act in good faith,
for a proper purpose and in the interests of the company, that such assistance can properly be
given. Such assistance should be on an arm’s-length basis.
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4. Dividends and Distributions
With the exception of section 34 of the Companies Act, there are no statutory provisions
relating to the payment of dividends. Based upon English case law which is likely to be
persuasive in the Cayman Islands in this area, dividends may be paid only out of profits. In
addition, section 34 of the Companies Act permits, subject to a solvency test and the
provisions, if any, of the company’s memorandum and articles of association, the payment of
dividends and distributions out of the share premium account (see paragraph 3 above for
details).
5. Shareholders’ Suits
The Cayman Islands courts can be expected to follow English case law precedents. The
rule in Foss v. Harbottle (and the exceptions thereto which permit a minority shareholder to
commence a class action against or derivative actions in the name of the company to challenge
(a) an act which is ultra vires the company or illegal, (b) an act which constitutes a fraud
against the minority where the wrongdoers are themselves in control of the company, and (c)
an action which requires a resolution with a qualified (or special) majority which has not been
obtained) has been applied and followed by the courts in the Cayman Islands.
6. Protection of Minorities
In the case of a company (not being a bank) having a share capital divided into shares,
the Grand Court of the Cayman Islands may, on the application of members holding not less
than one-fifth of the shares of the company in issue, appoint an inspector to examine into the
affairs of the company and to report thereon in such manner as the Grand Court shall direct.
Any shareholder of a company holding fully-paid shares may petition the Grand Court of
the Cayman Islands which may make a winding up order if the court is of the opinion that it
is just and equitable that the company should be wound up.
Claims against a company by its shareholders must, as a general rule, be based on the
general laws of contract or tort applicable in the Cayman Islands or their individual rights as
shareholders as established by the company’s memorandum and articles of association.
The English common law rule that the majority will not be permitted to commit a fraud
on the minority has been applied and followed by the courts of the Cayman Islands.
7. Disposal of Assets
The Companies Act contains no specific restrictions on the powers of directors to dispose
of assets of a company. As a matter of general law, every officer of a company, which includes
a director, managing director and secretary is required, in exercising his or her powers and
discharging his or her duties must do so honestly and in good faith with a view to the best
interests of the company and exercise the care, diligence and skill that a reasonably prudent
person would exercise in comparable circumstances.
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8. Accounting and Auditing Requirements
The Companies Act requires that a company shall cause to be kept proper books of
account with respect to:
(a) all sums of money received and expended by the company and the matters in respect
of which the receipt and expenditure takes place;
(b) all sales and purchases of goods by the company; and
(c) the assets and liabilities of the company.
A company is required to keep such books of account as are necessary to give a true and
fair view of the state of the company’s affairs and to explain its transactions and shall cause
all books of account to be retained for a minimum period of 5 years from the date on which
they are prepared.
9. Register of Members
An exempted company may, subject to the provisions of its articles of association,
maintain its principal register of members and any branch registers at such locations, whether
within or without the Cayman Islands, as its directors may from time to time think fit. There
is no requirement under the Companies Act for an exempted company to make any returns of
members to the Registrar of Companies of the Cayman Islands. The names and addresses of the
members are, accordingly, not a matter of public record and are not available for public
inspection. However, (i) an exempted company shall make available, at its registered office, in
electronic form or any other medium, such register of members, including any branch register
of members, as may be required of it upon service of an order or notice by the Tax Information
Authority pursuant to the Tax Information Authority Act (As Revised) of the Cayman Islands,
and (ii) unless exempted, a company has an obligation to maintain a register of its beneficial
owners pursuant to the Beneficial Ownership Transparency Act 2023 (As Revised), and such
register may be accessed by certain authorities as set out in the legislation.
10. Register of Directors
A register containing the names and addresses of its directors and officers must be
maintained at the registered office in the Cayman Islands, and the company must notify the
Registrar of Companies of any change in such directors or officers including a change of the
name of such directors or officers within sixty days of any such change.
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11. Register of Mortgages and Charges
A company must maintain a register of all mortgages and charges specifically affecting
property of the company, and shall enter in such register in respect of each mortgage or charge
a short description of the property mortgaged or charged, the amount of charge created and the
names of the mortgagees or persons entitled to such charge. The register of mortgages and
charges shall be open to inspection by any creditor or member of the company at all reasonable
times.
12. Inspection of Books and Records
Members of a company will have no general right under the Companies Act to inspect or
obtain copies of the register of members or corporate records of the company. They will,
however, have such rights as may be set out in the company’s articles of association.
13. Special Resolutions
The Companies Act provides that a resolution is a special resolution when it has been
passed by a majority of at least two-thirds of such members as, being entitled to do so, vote
in person or, where proxies are allowed, by proxy at a general meeting of which notice
specifying the intention to propose the resolution as a special resolution has been duly given,
except that a company may in its articles of association specify that the required majority shall
be a number greater than two-thirds, and may additionally so provide that such majority (being
not less than two-thirds) may differ as between matters required to be approved by a special
resolution. Written resolutions signed by all the members entitled to vote for the time being of
the company may take effect as special resolutions if this is authorised by the articles of
association of the company.
14. Subsidiary Owning Shares in Parent
The Companies Act does not prohibit a Cayman Islands company acquiring and holding
shares in its parent company provided its objects so permit. The directors of any subsidiary
making such acquisition must discharge their duties of care and to act in good faith, for a
proper purpose and in the interests of the subsidiary.
15. Mergers and Consolidations
The Companies Act permits mergers and consolidations between Cayman Islands
companies and between Cayman Islands companies and non-Cayman Islands companies. For
these purposes, (a) “merger” means the merging of two or more constituent companies and the
vesting of their undertaking, property and liabilities in one of such companies as the surviving
company, and (b) “consolidation” means the combination of two or more constituent
companies into a consolidated company and the vesting of the undertaking, property and
liabilities of such companies to the consolidated company. In order to effect such a merger or
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consolidation, the directors of each constituent company must approve a written plan of merger
or consolidation, which must then be authorised by (a) a special resolution of each constituent
company and (b) such other authorisation, if any, as may be specified in such constituent
company’s articles of association. The written plan of merger or consolidation must be filed
with the Registrar of Companies of the Cayman Islands together with a declaration as to the
solvency of the consolidated or surviving company, a list of the assets and liabilities of each
constituent company and an undertaking that a copy of the certificate of merger or
consolidation will be given to the members and creditors of each constituent company and that
notification of the merger or consolidation will be published in the Cayman Islands Gazette.
Dissenting shareholders have the right to be paid the fair value of their shares (which, if not
agreed between the parties, will be determined by the Cayman Islands court) if they follow the
required procedures, subject to certain exceptions. Court approval is not required for a merger
or consolidation which is effected in compliance with these statutory procedures.
16. Reconstructions
There are statutory provisions which facilitate reconstructions and amalgamations
approved by a majority in number representing 75% in value of shareholders or creditors,
depending on the circumstances, as are present at a meeting called for such purpose and
thereafter sanctioned by the Grand Court of the Cayman Islands. Whilst a dissenting
shareholder would have the right to express to the Grand Court his or her view that the
transaction for which approval is sought would not provide the shareholders with a fair value
for their shares, the Grand Court is unlikely to disapprove the transaction on that ground alone
in the absence of evidence of fraud or bad faith on behalf of management and if the transaction
were approved and consummated the dissenting shareholder would have no rights comparable
to the appraisal rights (i.e. the right to receive payment in cash for the judicially determined
value of his or her shares) ordinarily available, for example, to dissenting shareholders of
United States corporations.
17. Take-overs
Where an offer is made by a company for the shares of another company and, within four
months of the offer, the holders of not less than 90% of the shares which are the subject of the
offer accept, the offeror may at any time within two months after the expiration of the said four
months, by notice require the dissenting shareholders to transfer their shares on the terms of
the offer. A dissenting shareholder may apply to the Grand Court of the Cayman Islands within
one month of the notice objecting to the transfer. The burden is on the dissenting shareholder
to show that the Grand Court should exercise its discretion, which it will be unlikely to do
unless there is evidence of fraud or bad faith or collusion as between the offeror and the holders
of the shares who have accepted the offer as a means of unfairly forcing out minority
shareholders.
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18. Indemnification
Cayman Islands law does not limit the extent to which a company’s articles of association
may provide for indemnification of officers and directors, except to the extent any such
provision may be held by the Cayman Islands courts to be contrary to public policy (e.g. for
purporting to provide indemnification against the consequences of committing a crime).
19. Liquidation
A company may be placed in liquidation compulsorily by an order of the court, or
voluntarily (a) by a special resolution of its members if the company is solvent, or (b) by an
ordinary resolution of its members if the company is insolvent. The liquidator’s duties are to
collect the assets of the company (including the amount (if any) due from the contributories
(shareholders)), settle the list of creditors and discharge the company’s liability to them,
rateably if insufficient assets exist to discharge the liabilities in full, and to settle the list of
contributories and divide the surplus assets (if any) amongst them in accordance with the rights
attaching to the shares.
20. Stamp Duty on Transfers
No stamp duty is payable in the Cayman Islands on transfers of shares of Cayman Islands
companies except those which hold interests in land in the Cayman Islands.
21. Taxation
Pursuant to section 6 of the Tax Concessions Act (2018 Revision) of the Cayman Islands,
the Company may obtain an undertaking from the Financial Secretary of the Cayman Islands:
(a) that no law which is enacted in the Cayman Islands imposing any tax to be levied
on profits, income, gains or appreciations shall apply to the Company or its
operations; and
(b) in addition, that no tax to be levied on profits, income, gains or appreciations or
which is in the nature of estate duty or inheritance tax shall be payable:
(i) on or in respect of the shares, debentures or other obligations of the Company;
or
(ii) by way of the withholding in whole or in part of any relevant payment as
defined in section 6(3) of the Tax Concessions Act (2018 Revision).
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The Cayman Islands currently levy no taxes on individuals or corporations based upon
profits, income, gains or appreciations and there is no taxation in the nature of inheritance tax
or estate duty. There are no other taxes likely to be material to the Company levied by the
Government of the Cayman Islands save certain stamp duties which may be applicable, from
time to time, on certain instruments executed in or brought within the jurisdiction of the
Cayman Islands. The Cayman Islands are not party to any double tax treaties that are applicable
to any payments made by or to the Company.
22. Exchange Control
There are no exchange control regulations or currency restrictions in the Cayman Islands.
23. General
Travers Thorp Alberga, the Company’s legal adviser on Cayman Islands law, have sent to
the Company a letter of advice summarising aspects of Cayman Islands company law. This
letter, together with a copy of the Companies Act, is available for inspection as referred to in
the section headed “Documents Delivered to the Registrar of Companies in Hong Kong and on
Display” in Appendix V . Any person wishing to have a detailed summary of Cayman Islands
company law or advice on the differences between it and the laws of any jurisdiction with
which he or she is more familiar is recommended to seek independent legal advice.
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A. FURTHER INFORMATION ABOUT OUR GROUP
1. Incorporation of our Company
Our Company was incorporated in the Cayman Islands under the Cayman Companies Act
as an exempted company with limited liability on November 1, 2018. We have established a
principal place of business in Hong Kong at 5/F, Manulife Place 348, Kwun Tong Road,
Kowloon, Hong Kong and have been registered as a non-Hong Kong company under Part 16
of the Companies Ordinance on February 23, 2021 under the same address. Ms. CHAN Sze
Ting has been appointed as our authorised representative under the Companies Ordinance for
the acceptance of service of process and notices on our behalf in Hong Kong.
As we were incorporated in the Cayman Islands, our operations are subject to the relevant
laws of the Cayman Islands and our constitution which comprises the Memorandum and the
Articles. A summary of certain provisions of our constitution and relevant aspects of the
Cayman Companies Act is set forth in Appendix III to this document.
2. Changes in our share capital
As at November 1, 2018, being the date of incorporation of the Company, our authorized
share capital was US$50,000 divided into 500,000,000 Shares with a par value of US$0.0001
each.
There has been no alteration in our share capital within two years immediately preceding
the date of this document.
3. Changes in the share capital of our subsidiaries
A summary of the information on our subsidiaries is set forth in the Accountants’ Report,
the text of which is set forth in Appendix I to this document.
The following alterations in the share capital of our subsidiaries have taken place within
two years immediately preceding the date of this document:
VISEN Shanghai
On July 20, 2023, the registered share capital of VISEN Shanghai increased from US$75
million to US$80 million.
On October 11, 2023, the registered share capital of VISEN Shanghai increased from
US$80 million to US$95 million.
On July 4, 2024, the registered share capital of VISEN Shanghai increased from US$95
million to US$113 million.
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VISEN HK
On July 17, 2023, VISEN HK issued 20,000,000 shares to the Company for a
consideration of US$20 million.
On December 21, 2023, VISEN HK issued 6,000,000 shares to the Company for a
consideration of US$6 million.
On July 8, 2024, VISEN HK issued 18,000,000 shares to the Company for a consideration
of US$18 million.
Save as disclosed above, there has been no alteration in the share capital of our
subsidiaries that took place within two years preceding the date of this document.
4. Resolutions passed by our Shareholders
Pursuant to the written resolutions passed by our Shareholders on March 8, 2025, the
following resolutions, among others, were duly passed:
(a) the Memorandum and Articles of Association were approved and adopted, and will
come into effect upon Listing;
(b) conditional on (1) the Listing Committee granting the listing of, and permission to
deal in, the Shares in issue and to be issued as mentioned in this document; and (2)
the obligations of the Underwriters under the Underwriting Agreements becoming
unconditional and the Underwriting Agreements not being terminated in accordance
with the terms therein or otherwise:
(i) the Global Offering, the Offer Size Adjustment Option and the Over-allotment
Option were approved and our Directors were authorized to effect the same,
and to allot and issue the Offer Shares pursuant to the Global Offering, the
Offer Size Adjustment Option and the Over-allotment Option;
(ii) the grant of the Over-allotment Option by our Company to the International
Underwriters to allot and issue up to 15% of the Offer Shares initially available
under the Global Offering to cover, among other things, the over-allocations in
the International Offering was approved; and
(iii) the proposed Listing was approved, and our Directors were authorized to
implement such Listing.
(c) a general unconditional mandate was granted to our Directors to allot, issue and deal
with Shares, and to make or grant offers, agreements, or options which might require
such Shares to be allotted and issued or dealt with at any time subject to the
requirement that the aggregate nominal value of the Shares so allotted and issued or
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agreed conditionally or unconditionally to be allotted and issued, shall not exceed
20% of the aggregate nominal value of the share capital of our Company in issue
(excluding any treasury shares) immediately following completion of the Global
Offering (excluding Shares which may be allotted and issued upon the exercise of
the Offer Size Adjustment Option and the Over-allotment Option).
This mandate does not cover Shares to be allotted, issued, or dealt with under a
rights issue or scrip dividend scheme or similar arrangements, or a specific authority
granted by our Shareholders or upon the exercise of the Offer Size Adjustment
Option or the Over-allotment Option. This general mandate to issue Shares will
remain in effect until:
(i) the conclusion of the next annual general meeting of our Company;
(ii) the expiration of the period within which the next annual general meeting of
our Company is required to be held under the applicable laws or the Articles
of Association; or
(iii) it is varied or revoked by an ordinary resolution of our Shareholders at a
general meeting of our Company;
whichever is the earliest;
(d) a general unconditional mandate was granted to our Directors to exercise all powers
of our Company to repurchase Shares with an aggregate nominal value of not more
than 10% of the aggregate nominal value of the share capital of our Company in
issue (excluding any treasury shares) immediately following completion of the
Global Offering (excluding Shares which may be allotted and issued upon the
exercise of the Offer Size Adjustment Option and the Over-allotment Option).
This mandate only relates to repurchase made on the Stock Exchange or on any other
stock exchange on which the Shares may be listed (and which is recognized by the
SFC and the Stock Exchange for this purpose) and made in accordance with all
applicable laws and regulations and the requirements of the Listing Rules. This
general mandate to repurchase Shares will remain in effect until:
(i) the conclusion of the next annual general meeting of our Company;
(ii) the expiration of the period within which the next annual general meeting of
our Company is required to be held under any applicable laws or the Articles
of Association; or
(iii) it is varied or revoked by an ordinary resolution of our Shareholders at a
general meeting of our Company;
whichever is the earliest; and
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(e) the general unconditional mandate as mentioned in paragraph (c) above would be
extended by the addition to the aggregate nominal value of the Shares which may be
allotted and issued or agreed to be allotted and issued by our Directors pursuant to
such general mandate of an amount representing the aggregate nominal value of the
Shares purchased by our Company pursuant to the mandate to repurchase Shares
referred to in paragraph (d) above (up to 10% of the aggregate nominal value of the
Shares in issue (excluding any treasury shares) immediately following completion of
the Global Offering, excluding any Shares which may fall to be allotted and issued
pursuant to the exercise of the Offer Size Adjustment Option or the Over-allotment
Option).
5. Restrictions on Repurchase
This section sets out information required by the Stock Exchange to be included in this
document concerning the repurchase by us of our own Shares.
(a) Provisions of the Listing Rules
The Listing Rules permit companies with a primary listing on the Stock Exchange
to repurchase their own Shares on the Stock Exchange subject to certain restrictions, the
most important of which are summarized below:
(i) Shareholders’ Approval
All proposed repurchase of Shares (which must be fully paid up in the case of
shares) by a company with a primary listing on the Stock Exchange must be
approved in advance by an ordinary resolution of the shareholders, either by way of
general mandate or by specific approval of a particular transaction.
(ii) Source of Funds
Repurchases must be funded out of funds legally available for the purpose in
accordance with the constitutive documents of a listed company, the laws of the
jurisdiction in which the listed company is incorporated or otherwise established. A
listed company may not repurchase its own securities on the Stock Exchange for a
consideration other than cash or for settlement otherwise than in accordance with the
trading rules of the Stock Exchange from time to time. Subject to the foregoing, any
repurchases by a listed company may be made out of the funds which would
otherwise be available for dividend or distribution or out of the proceeds of a new
issue of shares made for the purpose of the repurchase. Any amount of premium
payable on the purchase over the par value of the shares to be repurchased must be
out of the funds which would otherwise be available for dividend or distribution or
from sums standing to the credit of our share premium account.
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(iii) Trading Restrictions
The total number of shares which a listed company may repurchase on the
Stock Exchange is the number of shares representing up to a maximum of 10% of
the aggregate number of shares in issue (excluding treasury shares).
A company may not make a new issue, sell or transfer treasury shares, or
announce a proposed new issue of shares for a period of 30 days after any repurchase
(other than an issue of securities pursuant to an exercise of warrants, share options
or similar instruments requiring the listed company to issue securities which were
outstanding prior to such repurchase) without the prior approval of the Stock
Exchange. Such restriction does not apply to (i) a new issue of Shares, or a sale or
transfer of treasury shares under capitalization issue; (ii) a grant of share awards or
options under a share scheme that complies with Chapter 17 of the Listing Rules or
a new issue of Shares or a transfer of treasury shares upon vesting or exercise of
shares awards or options under the share scheme that complies with Chapter 17 of
the Listing Rules; and (iii) a new issue of Shares or a transfer of treasury shares
pursuant to the exercise of warrants, share options or similar instruments requiring
our Company to issue Shares or transfer treasury shares, which were outstanding
prior to the purchase of its own Shares.
In addition, a listed company is prohibited from repurchasing its shares on the
Stock Exchange if the purchase price is 5% or more than the average closing market
price for the five preceding trading days on which its shares were traded on the
Stock Exchange.
The Listing Rules also prohibit a listed company from repurchasing its
securities which are in the hands of the public falling below the relevant prescribed
minimum percentage as required by the Stock Exchange.
A company is required to procure that the broker appointed by it to effect a
repurchase of securities discloses to the Stock Exchange such information with
respect to the repurchase made on behalf of the listed company as the Stock
Exchange may require.
A listed company may not make any repurchase of shares after inside
information has come to its knowledge until the information is made publicly
available. In particular, during the period of one month immediately preceding the
earlier of: (i) the date of the board meeting (as such date is first notified to the Stock
Exchange in accordance with the Listing Rules) for the approval of a listed
company’s results for any year, half-year, quarterly or any other interim period
(whether or not required under the Listing Rules); and (ii) the deadline for a listed
company to announce its results for any year or half-year under the Listing Rules,
APPENDIX IV STATUTORY AND GENERAL INFORMATION
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or quarterly or any other interim period (whether or not required under the Listing
Rules) and ending on the date of the results announcement, the listed company may
not repurchase its shares on the Stock Exchange other than in exceptional
circumstances.
(iv) Status of Repurchased Shares
Our Company may cancel any repurchased Shares (upon which the certificates
for such shares must be cancelled and destroyed) and/or hold them as treasury shares
subject to, among others, market conditions and its capital management needs at the
relevant time of the repurchases, which may change due to evolving circumstances.
Shareholders and potential investors should pay attention to any announcement to be
published by us in the future, including but without limitation, any next day
disclosure return (which shall identify, amongst others, the number of repurchased
Shares that are to be held as treasury shares or cancelled upon settlement of such
repurchases).
The listing status of all Shares which are held as treasury shares will be
retained. Our Company will ensure that treasury shares are appropriately identified
and segregated. For any treasury shares deposited with CCASS pending resale on
the Stock Exchange, our Company will ensure that it would not exercise any
shareholders’ rights or receive any entitlements which would otherwise be
suspended under the relevant laws if those shares were registered in our Company’s
own name as treasury shares by, including but not limited to, obtaining an approval
by the board of our Company that (i) our Company should procure its broker not to
give any instructions to HKSCC to vote at general meetings for the treasury shares
deposited with CCASS; and (ii) in the case of dividends or distributions, our
Company should withdraw the treasury shares from CCASS, and either re-register
them in its own name as treasury shares or cancel them, in each case before the
record date for the dividends or distributions. The listing status of all Shares which
are purchased by our Company (whether on the Stock Exchange or otherwise) but
not held as treasury shares shall be automatically cancelled upon repurchase. Our
Company shall ensure that the documents of title of these repurchased Shares are
cancelled and destroyed as soon as reasonably practicable following settlement of
any such repurchase.
(v) Reporting Requirements
Certain information relating to repurchases of shares on the Stock Exchange or
otherwise must be reported to the Stock Exchange not later than 30 minutes before
the earlier of the commencement of the morning trading session or any pre-opening
session on the following business day on which the listed company makes a
purchase of its shares. The report must state the total number of shares purchased by
the listed company the previous day, the purchase price per share or the highest and
lowest prices paid for such purchases, whether the repurchased shares are held as
APPENDIX IV STATUTORY AND GENERAL INFORMATION
– IV-6 –


--- page 656 ---
treasury shares. In addition, a listed company’s annual report is required to disclose
details regarding repurchases of shares made during the year, including the number
of shares repurchased each month (whether on the Stock Exchange or otherwise),
the purchase price per share or the highest and lowest price paid for all such
purchases, where relevant, the aggregate price paid, whether the repurchased shares
are held as treasury shares.
(vi) Core Connected Persons
A listed company is prohibited from knowingly repurchasing its shares from a
“core connected person,” that is, a director, chief executive or substantial
shareholder of the company or any of its subsidiaries or their close associates and
a core connected person is prohibited from knowingly selling its shares to the
company.
(b) Reasons for Repurchase
Our Directors believe that it is in the best interest of us and our Shareholders for our
Directors to have general authority from the Shareholders to enable us to repurchase
Shares in the market. Such repurchases may, depending on market conditions and funding
arrangements at the time, lead to an enhancement of the net asset value per Share and/or
earnings per Share and will only be made where our Directors believe that such
repurchases will benefit us and our Shareholders.
(c) Funding of Repurchases
In repurchasing securities, we may only apply funds legally available for such
purpose in accordance with the Memorandum of Association and Articles of Association,
the Companies Act or other applicable laws of Cayman Islands and the Listing Rules. On
the basis of our current financial condition as disclosed in this document and taking into
account our current working capital position, our Directors consider that, if the
Repurchase Mandate were to be exercised in full, it might have a material adverse effect
on our working capital and/or our gearing position as compared with the position
disclosed in this document. However, our Directors do not propose to exercise the
repurchase mandate to such an extent as would, in the circumstances, have a material
adverse effect on our working capital requirements or the gearing levels which in the
opinion of our Directors are from time to time appropriate for us.
APPENDIX IV STATUTORY AND GENERAL INFORMATION
– IV-7 –


--- page 657 ---
(d) General
Exercise in full of the current repurchase mandate, on the basis of 112,441,864
Shares in issue after completion of the Global Offering (without taking into account of the
Shares which may be allotted and issued pursuant to the exercise of the Offer Size
Adjustment Option or the Over-allotment Option), could accordingly result in up to
approximately 11,244,186 Shares being repurchased by us during the period prior to:
(i) the conclusion of our next annual general meeting;
(ii) the expiration of the period within which the next annual general meeting of
our Company is required by any applicable law or the Articles of Association
to be held; or
(iii) the date on which the repurchase mandate is varied or revoked by an ordinary
resolution of our Shareholders in general meeting; whichever is the earliest.
None of our Directors nor, to the best of their knowledge having made all reasonable
enquiries, any of their close associates (as defined in the Listing Rules) currently intends
to sell any Shares to us or our subsidiaries. Our Directors have undertaken with the Stock
Exchange that, so far as the same may be applicable, they will exercise the repurchase
mandate in accordance with the Listing Rules, the Memorandum of Association and
Articles of Association, the Companies Act or any other applicable laws of the Cayman
Islands.
If, as a result of a repurchase of our Shares pursuant to the repurchase mandate, a
Shareholder’s proportionate interest in our voting rights is increased, such increase will
be treated as an acquisition for the purpose of the Takeovers Code. Accordingly, a
Shareholder or a group of Shareholders acting in concert could obtain or consolidate
control of us and become obliged to make a mandatory offer in accordance with Rule 26
of the Takeovers Code. Save as aforesaid, our Directors are not aware of any
consequences which would arise under the Takeovers Code as a consequence of any
repurchases pursuant to the repurchase mandate.
No core connected person, as defined in the Listing Rules, has notified us that he/she
or it has a present intention to sell his/her or its Shares to us, or has undertaken not to do
so, if the repurchase mandate is exercised.
APPENDIX IV STATUTORY AND GENERAL INFORMATION
– IV-8 –


--- page 658 ---
B. FURTHER INFORMATION ABOUT OUR BUSINESS
1. Summary of material contracts
We have entered into the following contracts (not being contracts entered into in the
ordinary course of business) within the two years preceding the date of this document that are
or may be material:
(1) the Hong Kong Underwriting Agreement.
(2) a cornerstone investment agreement dated March 11, 2025 entered into among the
Company, AnkeBio (HongKong) Co., Limited (ي(ಥ)ʮ̡), Morgan
Stanley Asia Limited and Jefferies Hong Kong Limited, pursuant to which AnkeBio
(HongKong) Co., Limited (ي(ಥ)ʮ̡) agreed to subscribe for Offer
Shares at the Offer Price in the aggregate amount of Hong Kong dollar equivalent
of US$30.0 million, in accordance with the terms of the cornerstone investment
agreement.
(3) a cornerstone investment agreement dated March 11, 2025 entered into among the
Company, Suzhou Harvest International Co., Limited (ʮ̡), Morgan
Stanley Asia Limited and Jefferies Hong Kong Limited, pursuant to which Suzhou
Harvest International Co., Limited (ʮ̡) agreed to subscribe for
Offer Shares at the Offer Price in the aggregate amount of Hong Kong dollar
equivalent of US$18.0 million, in accordance with the terms of the cornerstone
investment agreement.
(4) a cornerstone investment agreement dated March 11, 2025 entered into among the
Company, Vivo Plenilune IX Limited, Morgan Stanley Asia Limited and Jefferies
Hong Kong Limited, pursuant to which Vivo Plenilune IX Limited agreed to
subscribe for Offer Shares at the Offer Price in the aggregate amount of Hong Kong
dollar equivalent of US$10.0 million, in accordance with the terms of the
cornerstone investment agreement.
(5) a cornerstone investment agreement dated March 11, 2025 entered into among the
Company, WuXi Biologics HealthCare V enture, Morgan Stanley Asia Limited and
Jefferies Hong Kong Limited, pursuant to which WuXi Biologics HealthCare
V enture agreed to subscribe for Offer Shares at the Offer Price in the aggregate
amount of Hong Kong dollar equivalent of US$10.0 million, in accordance with the
terms of the cornerstone investment agreement.
(6) a cornerstone investment agreement dated March 11, 2025 entered into among the
Company, The Reynold Lemkins Group (Asia) Limited, Morgan Stanley Asia
Limited and Jefferies Hong Kong Limited, pursuant to which The Reynold Lemkins
Group (Asia) Limited agreed to subscribe for Offer Shares at the Offer Price in the
aggregate amount of Hong Kong dollar equivalent of US$4.0 million, in accordance
with the terms of the cornerstone investment agreement.
APPENDIX IV STATUTORY AND GENERAL INFORMATION
– IV-9 –


--- page 659 ---
2. Intellectual Property Rights of Our Group
(a) Trademarks
As at the Latest Practicable Date, our Group has registered the following
trademarks, which we consider to be or may be material to our business:
No. Trademark Owner Class
Place of
Registration Expiry Date
Registration
Number
1 VISEN VISEN Shanghai 35 PRC September 6,
2033
46448849
2 VISEN VISEN Shanghai 35 PRC April 13, 2032 50914244
3 VISEN VISEN Shanghai 5 PRC October 6,
2031
51329106
4 VISEN VISEN Shanghai 10 PRC February 6,
2032
58107493
5 ၪ؁VISEN Shanghai 10 PRC September 13,
2033
63503436
6 ၪ؁VISEN Shanghai 5 PRC October 27,
2032
54815389
7 ၪ؁VISEN Shanghai 35 PRC January 6,
2033
54827259
8 ၪ؁VISEN Shanghai 35 PRC May 20, 2032 54836276
9 ၪጲ৷ VISEN Shanghai 5 PRC January 27,
2032
58118622
10 ၪ؁അ VISEN Shanghai 10 PRC January 27,
2032
58120354
11 VISENPHM VISEN Shanghai 35 PRC August 6,
2029
35290153
12 VISENPHM VISEN Shanghai 5 PRC August 6,
2029
35301061
13 VISENMED VISEN Shanghai 5 PRC August 20,
2029
35440861
14 VISENMED VISEN Shanghai 35 PRC August 13,
2029
35444832
15
 VISEN Shanghai 10 PRC May 13, 2034 75054451
16
 VISEN Shanghai 5 PRC November 6,
2034
77141005
17 VISEN VISEN HK 5, 10
&3 5
HK July 27, 2031 305701509
18 ၪጲ৷ (Series) VISEN HK 5 HK July 27, 2031 305701383
19 ၪ؁Series) VISEN HK 5, 10
&3 5
HK July 27, 2031 305701491
20
 VISEN Shanghai 35 PRC February 13,
2035
58099506
21
 VISEN Shanghai 35 PRC February 13,
2035
58099518
APPENDIX IV STATUTORY AND GENERAL INFORMATION
– IV-10 –


--- page 660 ---
As at the Latest Practicable Date, our Group has applied for the registration of the
following trademarks, which we consider to be or may be material to our business:
No. Trademark Class Registrant
Place of
Registration
Registration
No.
Application
Date
1.
 5 VISEN Shanghai PRC 83380596 February 10,
2025
2.
 10 VISEN Shanghai PRC 83380606 February 10,
2025
3.
 5 VISEN Shanghai PRC 83386011 February 10,
2025
4.
 10 VISEN Shanghai PRC 83384584 February 10,
2025
(b) Patents
The following table sets forth the details of the material granted patents and filed
patent applications in connection with our drug candidates:
Patent Application/
Publication Number Scope of Protection Jurisdiction Applicant Application Date Status Expiration date Rights of the Company
Lonapegsomatropin
CN102014965B PEGylated recombinant
human growth hormone
compounds
CN Ascendis Pharma
Endocrinology
Division
April 29, 2009 Granted April 29, 2029 The Company was
granted by the
Applicant an exclusive,
royalty-free licence
(with the right to grant
sub-licences) under this
patent to develop,
manufacture, have
made, use, sell, offer
for sale, import, export
or otherwise
commercialize licensed
product in the
treatment and/or
prevention of any
disease, condition or
disorder of any human
indication, excluding
the excluded
indications in the PRC,
including Hong Kong,
Macau and Taiwan.
CN102989001B hGH prodrugs CN Ascendis Pharma
Endocrinology
Division
April 29, 2009 Granted April 29, 2029
HK1179899B hGH prodrugs HK Ascendis Pharma
Endocrinology
Division
April 29, 2009 Granted April 29, 2029
HK1240819B Polymeric human growth
hormone prodrug
HK Ascendis Pharma
Endocrinology
Division
November 17,
2015
Granted November 17, 2035
CN113573698A
(2020800183773)
Pharmaceutical
formulation comprising
long-acting growth
hormone
CN Ascendis Pharma
Endocrinology
Division
March 3, 2020 Pending –
HK40054591 Pharmaceutical
formulation comprising
long-acting growth
hormone
HK Ascendis Pharma
Endocrinology
Division
March 3, 2020 Pending –
HK40061346 Pharmaceutical
formulation comprising
long-acting growth
hormone
HK Ascendis Pharma
Endocrinology
Division
March 3, 2020 Pending –
HK1152239B Growth Hormone (rhGH) HK Ascendis Pharma
Endocrinology
Division
April 29, 2009 Granted April 29, 2029
APPENDIX IV STATUTORY AND GENERAL INFORMATION
– IV-11 –


--- page 661 ---
Patent Application/
Publication Number Scope of Protection Jurisdiction Applicant Application Date Status Expiration date Rights of the Company
HK1244227B Pharmaceutical
formulation comprising
a long-acting growth
hormone
HK Ascendis Pharma
Endocrinology
Division
November 20,
2015
Granted November 20, 2035
HK1227482B PEGylated recombinant
human growth hormone
compounds
HK Ascendis Pharma
Endocrinology
Division
April 29, 2009 Granted April 29, 2029
HK40062835A PEGylated recombinant
human growth hormone
compounds
HK Ascendis Pharma
Endocrinology
Division
April 29, 2009 Pending –
HK40026920C Novel polymeric hGH
prodrugs
HK Ascendis Pharma
Endocrinology
Division
November 17,
2015
Granted November 17, 2035
HK40090144A Novel polymeric hGH
prodrugs
HK Ascendis Pharma
Endocrinology
Division
November 17,
2015
Pending –
HK40070795 Long-acting growth
hormone dosage forms
HK Ascendis Pharma
Endocrinology
Division
November 20,
2015
Pending –
HK40011764B Combination therapy HK Ascendis Pharma
Growth Disorders
September 28,
2017
Granted September 28, 2037
CN202411390852.6 Lyophilization methods,
lyophilization
preparations and
injections for
Lonapegsomatropin
CN The Company September 30,
2024
Pending – Ownership
CN202411686216.8 Lyophilization methods,
lyophilization
preparations and
injections for
Lonapegsomatropin
CN The Company November 22,
2024
Pending –
APPENDIX IV STATUTORY AND GENERAL INFORMATION
– IV-12 –


--- page 662 ---
Patent Application/
Publication Number Scope of Protection Jurisdiction Applicant Application Date Status Expiration date Rights of the Company
TransCon CNP
(navepegritide)
CN107405409B CNP prodrug or
pharmaceutically
acceptable salts thereof
CN Ascendis Pharma
Growth Disorders
January 8, 2016 Granted January 8, 2036 The Company was
granted by the
Applicant an exclusive,
royalty-free licence
(with the right to grant
sub-licences) under this
patent to develop,
manufacture, have
made, use, sell, offer
for sale, import, export
or otherwise
commercialize licensed
product in the
treatment and/or
prevention of any
disease, condition or
disorder of any human
indication, excluding
the excluded
indications in the PRC,
including Hong Kong,
Macau and Taiwan.
HK1246666B CNP prodrug or
pharmaceutically
acceptable salts thereof
HK Ascendis Pharma
Growth Disorders
January 8, 2016 Granted January 8, 2036
CN108472380B Controlled-release CNP
agonist
CN Ascendis Pharma
Growth Disorders
January 5, 2017 Granted January 5, 2037
CN114306629B
(Divisional patent of the
CN108472380B)
Controlled-release CNP
agonist
CN Ascendis Pharma
Growth Disorders
January 5, 2017 Granted January 5, 2037
HK40069215B Controlled-release CNP
agonist
HK Ascendis Pharma
Growth Disorders
January 5, 2017 Granted January 5, 2037
J/7651 Controlled-release CNP
agonist
Macau Ascendis Pharma
Growth Disorders
January 5, 2017 Granted January 5, 2037
HK1259384B Controlled-release CNP
agonist
HK Ascendis Pharma
Growth Disorders
January 5, 2017 Granted January 5, 2037
CN108472383B Controlled-release CNP
agonists with low
NPR-C binding
CN Ascendis Pharma
Growth Disorders
January 5, 2017 Granted January 5, 2037
HK1257769B Controlled-release CNP
agonists with low
NPR-C binding
HK Ascendis Pharma
Growth Disorders
January 5, 2017 Granted January 5, 2037
HK1262973A Controlled-release CNP
agonists with low
NPR-C binding
HK Ascendis Pharma
Growth Disorders
January 5, 2017 Pending –
J/6504 Controlled-release CNP
agonists with low
NPR-C binding
Macau Ascendis Pharma
Growth Disorders
January 5, 2017 Granted January 5, 2037
CN109843295B CNP combination therapy CN Ascendis Pharma
Growth Disorders
September 28,
2017
Granted September 28, 2037
HK40008972B CNP combination therapy HK Ascendis Pharma
Growth Disorders
September 28,
2017
Granted September 28, 2037
TW202200194A Dry pharmaceutical
formulations of CNP
conjugates
Taiwan Ascendis Pharma
Growth Disorders
June 19, 2020 Pending –
CN113423384B
(2020800134620)
Pharmaceutical
formulation comprises
a CNP conjugate
CN Ascendis Pharma
Growth Disorders
February 10, 2020 Granted February 10, 2040
APPENDIX IV STATUTORY AND GENERAL INFORMATION
– IV-13 –


--- page 663 ---
Patent Application/
Publication Number Scope of Protection Jurisdiction Applicant Application Date Status Expiration date Rights of the Company
HK40052552B Dry pharmaceutical
formulations of CNP
conjugates
HK Ascendis Pharma
Growth Disorders
February 10, 2020 Granted February 10, 2040
CN117281783A
(2023114269633)
Divisional application of
CN113423384B
Pharmaceutical
formulation comprises
a CNP conjugate
CN Ascendis Pharma
Growth Disorders
February 10, 2020 Pending –
CN115177720A Controlled release CNP CN Ascendis Pharma
Growth Disorders
January 5, 2017 Pending –
HK40074497A Controlled release CNP HK Ascendis Pharma
Growth Disorders
January 5, 2017 Pending –
HK40000047A Controlled-release CNP
agonist
HK Ascendis Pharma
Growth Disorders
January 5, 2017 Pending –
HK1262967A Controlled-release CNP
agonist
HK Ascendis Pharma
Growth Disorders
January 5, 2017 Pending –
HK1263063A Controlled-release CNP
agonist
HK Ascendis Pharma
Growth Disorders
January 5, 2017 Pending –
HK1262548B CNP prodrugs HK Ascendis Pharma
Growth Disorders
January 5, 2017 Granted January 5, 2037
HK1262549A CNP prodrug HK Ascendis Pharma
Growth Disorders
January 5, 2017 Pending –
HK1240818A CNP prodrugs HK Ascendis Pharma
Growth Disorders
January 8, 2016 Pending –
J/7895 Dry Pharmaceutical
formulations of CNP
conjugates
Macau Ascendis Pharma
Growth Disorders
February 10, 2020 Granted February 10, 2040
HK40105690A CNP conjugates HK Ascendis Pharma
Growth Disorders
February 10, 2020 Pending
CN118382462A Effective doses of CNP
conjugates
CN Ascendis Pharma
Growth Disorders
December 12,
2022
Pending –
CN202380055606.2 CNP prodrugs CN Ascendis Pharma
Growth Disorders
May 22, 2023 Pending –
HK40090963A CNP prodrugs HK Ascendis Pharma
Growth Disorders
January 5, 2017 Pending –
HK40060354A CNP conjugate HK Ascendis Pharma
Growth Disorders
February 10, 2020 Pending –
HK40011764B Combination therapy HK Ascendis Pharma
Growth Disorders
September 28,
2017
Granted September 28, 2037
HK40097709 Combination therapy HK Ascendis Pharma
Growth Disorders
September 28,
2017
Pending –
HK40069343A Prodrug precursor HK Ascendis Pharma A/S January 30, 2009 Pending –
APPENDIX IV STATUTORY AND GENERAL INFORMATION
– IV-14 –


--- page 664 ---
Patent Application/
Publication Number Scope of Protection Jurisdiction Applicant Application Date Status Expiration date Rights of the Company
Palopegteriparatide
CN101980725B A prodrug comprising
drug linker conjugate
D-L or a
pharmaceutically
acceptable salt thereof
CN Ascendis Pharma A/S January 30, 2009 Granted January 30, 2029 The Company was
granted by the
Applicant an exclusive,
royalty-free licence
(with the right to grant
sub-licences) under this
patent to develop,
manufacture, have
made, use, sell, offer
for sale, import, export
or otherwise
commercialize licensed
product in the
treatment and/or
prevention of any
disease, condition or
disorder of any human
indication, excluding
the excluded
indications in the PRC,
including Hong Kong,
Macau and Taiwan.
HK1152240B A prodrug comprising
drug linker conjugate
D-L or a
pharmaceutically
acceptable salt thereof
HK Ascendis Pharma A/S January 30, 2009 Granted January 30, 2029
CN109069659B PTH prodrugs CN Ascendis Pharma
Bone Diseases
February 28, 2017 Granted February 28, 2037
CN115025239A
(2022103105298)
Divisional application of
the patent CN109069659B
PTH prodrugs CN Ascendis Pharma
Bone Diseases
February 28, 2017 Pending –
HK40072521 PTH prodrugs HK Ascendis Pharma
Bone Diseases
February 28, 2017 Pending –
HK40000751B PTH prodrugs HK Ascendis Pharma
Bone Diseases
February 28, 2017 Granted February 28, 2037
J/6258 PTH prodrugs Macau Ascendis Pharma
Bone Diseases
February 28, 2017 Granted February 28, 2037
CN109789221B Pharmaceutical
composition
CN Ascendis Pharma
Bone Diseases
September 28,
2017
Granted September 28, 2037
HK40007777B Pharmaceutical
composition
HK Ascendis Pharma
Bone Diseases
September 28,
2017
Granted September 28, 2037
CN109789188B PTH compounds with
low peak-to-trough
ratios
CN Ascendis Pharma
Bone Diseases
September 28,
2017
Granted September 28, 2037
CN117257922A
(2023110527602)
Divisional application of
the patent CN109789188B
PTH compounds with
low peak-to-trough
ratios
CN Ascendis Pharma
Bone Diseases
September 28,
2017
Pending –
HK40007965B PTH compounds with
low peak-to-trough
ratios
HK Ascendis Pharma
Bone Diseases
September 28,
2017
Granted September 28, 2037
CN109789189B (Just
received Notice of
Allowance)
Controlled release
compounds
CN Ascendis Pharma
Bone Diseases
September 28,
2017
Granted September 28, 2037
HK40007776B Dosage regimen for a
controlled-release PTH
compound
HK Ascendis Pharma
Bone Diseases
September 28,
2017
Granted September 28, 2037
HK40011848B Controlled release
compounds
HK Ascendis Pharma
Bone Diseases
September 28,
2017
Granted September 28, 2037
CN112334152A Starting dose of PTH
conjugates
CN Ascendis Pharma
Bone Diseases
May 17, 2019 Pending –
HK40046206A Starting dose of PTH
conjugates
HK Ascendis Pharma
Bone Diseases
May 17, 2019 Pending –
TW202200195A Liquid formulation of
PTH conjugate
Taiwan Ascendis Pharma
Bone Diseases
June 19, 2020 Pending –
CN116847870A Treat mental health CN Ascendis Pharma
Bone Diseases
September 27,
2021
Pending –
HK40096950A Treat mental health HK Ascendis Pharma
Bone Diseases
September 27,
2021
Pending –
APPENDIX IV STATUTORY AND GENERAL INFORMATION
– IV-15 –


--- page 665 ---
Patent Application/
Publication Number Scope of Protection Jurisdiction Applicant Application Date Status Expiration date Rights of the Company
CN116059321A Pharmaceutical
composition for
controlling the PTH
release
CN Ascendis Pharma
Bone Diseases A/S
September 28,
2017
Pending –
HK40091935A Pharmaceutical
composition defined by
administration
frequency
HK Ascendis Pharma
Bone Diseases
September 28,
2017
Pending –
CN113423383A Liquid pharmaceutical
formulation
CN Ascendis Pharma
Bone Diseases A/S
February 10, 2020 Pending –
HK40052553A Liquid pharmaceutical
formulation
HK Ascendis Pharma
Bone Diseases
February 10, 2020 Pending –
HK40062302A Liquid pharmaceutical
formulation
HK Ascendis Pharma
Bone Diseases
February 10, 2020 Pending –
CN115003320A Compound defined by
regimen
CN Ascendis Pharma
Bone Diseases
January 12, 2021 Pending –
HK1263064B PTH prodrug HK Ascendis Pharma
Bone Diseases
February 28, 2017 Granted February 28, 2037
HK40046205A PTH conjugate HK Ascendis Pharma
Bone Diseases
May 17, 2019 Pending –
J/6797 A pharmaceutical
composition
comprising a
controlled-release PTH
compound
Macau Ascendis Pharma
Bone Diseases
September 28,
2017
Granted September 28, 2037
CN117838873A
Divisional application
of CN109789189A
Dosage regimen for a
controlled-release PTH
compound
CN Ascendis Pharma
Bone Diseases
September 28,
2017
Pending –
CN118234506A Long-acting PTH
compound treatments
CN Ascendis Pharma
Bone Diseases
September 21,
2022
Pending –
J/7897 Dosage regimen for a
controlled-release PTH
compound
Macau Ascendis Pharma
Bone Diseases
September 28,
2017
Granted September 28, 2037
HK40104816A PTH compounds HK Ascendis Pharma
Bone Diseases
September 28,
2017
Pending –
HK40011847A PTH Compound HK Ascendis Pharma
Bone Diseases
September 28,
2017
Pending –
HK40011765B PTH Compound HK Ascendis Pharma
Bone Diseases
September 28,
2017
Granted September 28, 2037
HK40098351A PTH Compound HK Ascendis Pharma
Bone Diseases
September 28,
2017
Pending –
HK40080600A PTH Compound
treatments
HK Ascendis Pharma
Bone Diseases
January 12, 2021 Pending –
APPENDIX IV STATUTORY AND GENERAL INFORMATION
– IV-16 –


--- page 666 ---
Patent Application/
Publication Number Scope of Protection Jurisdiction Applicant Application Date Status Expiration date Rights of the Company
HK40082807A PTH Compound
treatments
HK Ascendis Pharma
Bone Diseases
January 12, 2021 Pending –
HK40099006A PTH Compound HK Ascendis Pharma
Bone Diseases
September 28,
2017
Pending –
HK40108784 PTH Compound HK Ascendis Pharma
Bone Diseases
September 28,
2017
Pending –
HK40098648A PTH Compound
treatments
HK Ascendis Pharma
Bone Diseases
September 27,
2021
Pending –
HK40112933 PTH Compound
treatments
HK Ascendis Pharma
Bone Diseases
September 21,
2022
Pending –
Auto-Injector
CN115591054A Autoinjector CN Ascendis Pharma A/S May 23, 2018 Pending – The Company was
granted by the
Applicant an exclusive,
royalty-free licence
(with the right to grant
sub-licences) under this
patent to develop,
manufacture, have
made, use, sell, offer
for sale, import, export
or otherwise
commercialize licensed
product in the
treatment and/or
prevention of any
disease, condition or
disorder of any human
indication, excluding
the excluded
indications in the PRC,
including Hong Kong,
Macau and Taiwan.
CN110769873B Autoinjector CN Ascendis Pharma A/S May 23, 2018 Granted May 23, 2038
CN115154759B Autoinjector CN Ascendis Pharma A/S June 29, 2018 Granted June 29, 2038
CN110809484B Autoinjector CN Ascendis Pharma A/S June 29, 2018 Granted June 29, 2038
HK1262197A Autoinjector HK Ascendis Pharma A/S December 29,
2016
Pending –
HK1262144B Autoinjector HK Ascendis Pharma A/S December 29,
2016
Granted December 29, 2036
HK1262199A Autoinjector HK Ascendis Pharma A/S December 29,
2016
Pending –
HK1262201A Autoinjector HK Ascendis Pharma A/S December 29,
2016
Pending –
TW202322862A Autoinjector Taiwan Ascendis Pharma A/S September 29,
2022
Pending –
HK40016523B Autoinjector HK Ascendis Pharma A/S June 29, 2018 Granted June 29, 2038
HK40074077B Autoinjector HK Ascendis Pharma A/S June 29, 2018 Granted June 29, 2038
CN118284446A Autoinjector CN Ascendis Pharma A/S September 29,
2022
Pending –
HK40107809 Autoinjector HK Ascendis Pharma A/S September 29,
2022
Pending –
APPENDIX IV STATUTORY AND GENERAL INFORMATION
– IV-17 –


--- page 667 ---
Patent Application/
Publication Number Scope of Protection Jurisdiction Applicant Application Date Status Expiration date Rights of the Company
HK40108607 Autoinjector HK Ascendis Pharma A/S September 29,
2022
Pending –
HK1262145B Autoinjector HK Ascendis Pharma A/S December 29,
2016
Granted December 29, 2036
HK40084151A Autoinjector HK Ascendis Pharma A/S December 29,
2016
Pending –
HK40016524B Autoinjector HK Ascendis Pharma A/S May 23, 2018 Granted May 23, 2038
HK40081226 Autoinjector HK Ascendis Pharma A/S May 23, 2018 Pending –
HK1262200B Autoinjector HK Ascendis Pharma A/S December 29,
2016
Granted December 29, 2036
HK40062722A Autoinjector HK Ascendis Pharma A/S December 29,
2016
Pending –
HK1262198B Autoinjector HK Ascendis Pharma A/S December 29,
2016
Granted December 29, 2036
HK40077667A Autoinjector HK Ascendis Pharma A/S December 29,
2016
Pending –
Container Closure System
CN222062820U Combined cap and
dual-chamber cartridge
bottle
CN V endor A; VISEN
Shanghai
April 24, 2024 Granted April 24, 2034 Joint Ownership
CN117208401A Cap and dual-chamber
cartridge bottle
CN V endor A; VISEN
Shanghai
October 11, 2023 Pending –
CN220975146U Cap and dual-chamber
cartridge bottle
CN V endor A; VISEN
Shanghai
October 11, 2023 Granted October 11, 2033
CN118145166A Combined cap and
dual-chamber cartridge
bottle
CN V endor A; VISEN
Shanghai
April 24, 2024 Pending –
CN202411390947.8 Lyophilization methods,
lyophilization
preparations and
injections for
pharmaceutical,
cosmetic or aesthetic
products
CN The Company;
V endor B
September 30,
2024
Pending – Joint Ownership
CN202422400699.2 A cap assembly CN The Company;
V endor B
September 30,
2024
Pending –
CN202411390964.1 A cap assembly CN The Company;
V endor B
September 30,
2024
Pending –
CN202422858945.9 A cap assembly CN The Company;
V endor B
November 22,
2024
Pending –
CN202422858949.7 A cap assembly CN The Company;
V endor B
November 22,
2024
Pending –
CN202411686217.2 A cap assembly CN The Company;
V endor B
November 22,
2024
Pending –
APPENDIX IV STATUTORY AND GENERAL INFORMATION
– IV-18 –


--- page 668 ---
Patent Application/
Publication Number Scope of Protection Jurisdiction Applicant Application Date Status Expiration date Rights of the Company
CN202411686328.3 Lyophilization methods,
lyophilization
preparations and
injections for
pharmaceutical,
cosmetic or aesthetic
products
CN The Company;
V endor B
November 22,
2024
Pending –
(c) Domain name
As at the Latest Practicable Date, our Group owned the following domain name,
which we consider to be or may be material to our business:
Domain Name Registered Owner Expiry Date
www.visenpharma.com VISEN Shanghai October 29, 2025
APPENDIX IV STATUTORY AND GENERAL INFORMATION
– IV-19 –


--- page 669 ---
C. FURTHER INFORMATION ABOUT OUR DIRECTORS AND SUBSTANTIAL
SHAREHOLDERS
1. Disclosure of interests
(a) Disclosure of interests of Directors and Chief Executive
Immediately following completion of the Global Offering (without taking into
account any Shares which may be issued or allotted upon any exercise of the Offer Size
Adjustment Option or Over-allotment Option), the interests or short positions of our
Directors or chief executives in our Shares, underlying Shares and debentures of our
Company or our associated corporations (within the meaning of Part XV of the SFO)
which will be required to be notified to us and the Stock Exchange pursuant to Divisions
7 and 8 of Part XV of the SFO (including interests or short positions which they were
taken or deemed to have under such provisions of the SFO) or which will be required,
under Section 352 of the SFO, to be entered in the register referred to in that section, or
which will be required, under the “Model Code for Securities Transactions by Directors
of Listed Issuers” as set forth in Appendix C3 to the Listing Rules (the “Model Code”)
to be notified to us, once our Shares are listed will be as follows:
(i) Interest in our Company
Name of Director Nature of interest
Number of Shares
or underlying
Shares
Percentage of
shareholding interest
immediately prior to the
Global Offering (without
taking into account any
Shares which may be
issued upon the exercise
of the Offer Size
Adjustment Option)
Percentage of
shareholding interest
upon the Global Offering
(without taking into
account any Shares which
may be issued upon the
exercise of the Offer Size
Adjustment Option or the
Over-allotment Option)
Mr. LU An-bang Beneficiary of a
trust/Founder of a
discretionary
trust
(1)
5,000,000 4.88% 4.45%
Note:
(1) The VPP Trust is a discretionary trust established by Mr. Lu as the settlor, whose
beneficiaries include, among others, Mr. Lu and his family members. The trustee of the
VPP Trust is Tricor Equity Trustee Limited. Therefore, under the SFO, Mr. Lu is deemed
to be interested in the Shares which are held by Tricor Equity Trustee Limited through VPP
LU Limited.
APPENDIX IV STATUTORY AND GENERAL INFORMATION
– IV-20 –


--- page 670 ---
(b) Disclosure of interests of Substantial Shareholders
Save as disclosed in the section headed “Substantial Shareholders” in this document,
our Directors or chief executives are not aware of any other person, not being a Director
or chief executive of our Company, who has interests or short positions in our Shares or
underlying Shares, which following the completion of the Global Offering, would fall to
be disclosed to us and the Stock Exchange under the provisions of Divisions 2 and 3 of
Part XV of the SFO, or directly or indirectly, be interested in 10% or more of the nominal
value of any class of share capital carrying the rights to vote in all circumstances at
general meetings of our Company.
Save as disclosed in this document, to the best knowledge of our Directors,
immediately following the completion of the Global Offering, no persons will, directly or
indirectly, be interested in 10% or more of the nominal value of any class of share capital
carrying the rights to vote in all circumstances at general meetings of any other members
of our Company.
2. Particulars of Directors’ service contracts and appointment letters
(a) Executive Directors and non-executive Directors
Our executive Director entered into a service contract with our Company for a term
of three years effective from the Listing Date and subject to termination in accordance
with their respective terms. Each of these service contracts may be renewed in accordance
with the Articles and the applicable laws and regulations.
Each of the non-executive Directors entered into a letter of appointment with our
Company for a term of three years effective from the Listing Date and subject to
termination in accordance with their respective terms. Each of these letters of
appointment may be renewed in accordance with the Articles and the applicable laws and
regulations.
(b) Independent non-executive Directors
Each of the independent non-executive Directors has signed a letter of appointment
with our Company for a term of three years effective from the Listing Date and subject
to termination in accordance with their respective terms. Each of these letters of
appointment may be renewed in accordance with the Articles and the applicable laws and
regulations.
APPENDIX IV STATUTORY AND GENERAL INFORMATION
– IV-21 –


--- page 671 ---
3. Remuneration of Directors
The aggregate amount of remuneration (including salaries, bonuses, allowances and
benefits in kind, contributions to pension scheme, discretionary bonus and bonus based on
performance) that was paid by our Group to our Directors for the years ended December 31,
2022 and 2023 and the nine months ended September 30, 2024 was RMB62.5 million
(including share grant), RMB19.1 million (including share grant) and RMB24.7 million
(including share grant), respectively. Please refer to Note 9 of the Accountants’ Report in
Appendix I to this document on the Directors’ and chief executive’s emoluments and
employees’ remuneration for the Track Record Period.
It is estimated that emoluments of approximately RMB42.4 million in aggregate will be
paid to our Directors in respect of the financial year ending December 31, 2025 under
arrangements in force at the date of this document.
The aggregate amount of remuneration (including salaries, allowances and benefits in
kind, contributions to pension scheme, discretionary bonus and bonus based on performance)
paid to our five highest paid individuals (including both employees and Directors) for the years
ended December 31, 2022 and 2023 and the nine months ended September 30, 2024 was
RMB97.3 million, RMB38.6 million and RMB39.6 million, respectively.
There has been no arrangement under which a Director has waived or agreed to waive any
remuneration or benefits in kind for the Track Record Period.
4. Fees or commissions received
Save as disclosed in this document, none of the Directors or any of the persons whose
names are listed in the paragraphs under “– F. Other Information – 8. Consent of Experts”
below had received any commissions, discounts, agency fee, brokerage or other special terms
in connection with the issue or sale of any capital of any member of our Group within the two
years immediately preceding the date of this document.
5. Disclaimers
Save as disclosed in this document:
(a) none of our Directors or chief executives has any interests and short positions in our
Shares, underlying Shares and debentures of our Company or its associated
corporation (within the meaning of Part XV of the SFO) which will have to be
notified to us and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of
the SFO (including interests and short positions which he is taken or deemed to have
under such provisions of SFO) or which will be required, pursuant to section 352 of
the SFO, to be entered in the register referred to therein, or will be required,
pursuant to the Model Code to be notified to us and the Stock Exchange, in each case
once our Shares are listed on the Stock Exchange;
APPENDIX IV STATUTORY AND GENERAL INFORMATION
– IV-22 –


--- page 672 ---
(b) so far as is known to any of our Directors or chief executives, no person has an
interest or short position in our Shares and underlying Shares which would fall to
be disclosed to us and the Stock Exchange under the provisions of Divisions 2 and
3 of Part XV of the SFO, or is, directly or indirectly, interested in 10% or more of
the nominal value of any class of share capital carrying rights to vote in all
circumstances at general meetings of any other member of our Group;
(c) none of our Directors nor any of the persons whose names are listed in the
paragraphs under “– F. Other Information – 8. Consent of Experts” in this Appendix
is interested in our promotion, or in any assets which have, within the two years
immediately preceding the issue of this document, been acquired or disposed of by
or leased to us, or are proposed to be acquired or disposed of by or leased to us;
(d) save as disclosed in this document or in connection with the Underwriting
Agreements, none of our Directors nor any of the persons whose names are listed in
the paragraphs under “– F. Other Information – 8. Consent of Experts” in this
Appendix is materially interested in any contract or arrangement subsisting at the
date of this document which is significant in relation to the business of our Group;
(e) save in connection with the Underwriting Agreements, none of our Directors nor any
of the persons whose names are listed in the paragraphs under “– F. Other
Information – 8. Consent of Experts” in this Appendix: (i) is interested legally or
beneficially in any of our Shares or any share in any of our subsidiaries; or (ii) has
any right (whether legally enforceable or not) to subscribe for or to nominate
persons to subscribe for securities in any member of our Group;
(f) none of our Directors or their respective associates (as defined under the Listing
Rules) or any of our Shareholders (who to the knowledge of our Directors owns
more than 5% of our issued share capital) has any interest in our five largest
suppliers or customers; and
(g) none of the Directors or any past Directors of any members of our Group has been
paid any sum of money for the two years ended December 31, 2022 and 2023 and
the nine months ended September 30, 2024 (i) as an inducement to join or upon
joining us or (ii) for loss of office as a Director of any member of our Group or of
any other office in connection with the management of the affairs of any member of
our Group.
APPENDIX IV STATUTORY AND GENERAL INFORMATION
– IV-23 –


--- page 673 ---
D. EQUITY INCENTIVE PLAN
The following is a summary of the principal terms of the Equity Incentive Plan approved
and adopted by the Board on April 29, 2019, and as amended and restated by the Board on
January 8, 2021 and March 10, 2021, respectively. The terms of the Equity Incentive Plan are
not subject to the provisions of Chapter 17 of the Listing Rules. After Listing, no further
options or other type of awards would be granted pursuant to this Equity Incentive Plan.
The principal terms of the Equity Incentive Plan are as follows:
1. Purpose
The Equity Incentive Plan, through the granting of Share Awards (as defined below), is
intended to help the Company and its affiliates to secure and retain the services of eligible
award recipients, provide incentives for such persons to exert maximum efforts for the success
of the Company and any affiliate and provide means by which the eligible recipients may
benefit from increases in value of the Shares.
2. Duration
The Board may suspend or terminate the Equity Incentive Plan at any time. Unless
terminated sooner by the Board, the Plan will automatically terminate on April 28, 2029. No
Share Awards may be granted under the Equity Incentive Plan while it is suspended or after it
is terminated.
3. Administration
The Board will administer the Plan. The Board may delegate administration of the Equity
Incentive Plan to any committee or committees of one or more Directors (the Board or the
committee, the “ Administrator ”).
4. Share Award Agreement
Any terms and conditions of a Share Award (as defined below) grant shall be evidenced
by a written agreement between the Company and the grantee (the “Share Award Agreement”).
5. Eligibility
Share Awards may be granted to employees and consultants of the Company or its
affiliates.
6. Types of Awards
The Plan provides for the grant of the following types of share awards, (i) options and
share appreciation rights (“SAR”); (ii) restricted share awards; (iii) restricted share unit awards
(“RSU”), and (iv) other share awards, collectively, “Share Awards.”
APPENDIX IV STATUTORY AND GENERAL INFORMATION
– IV-24 –


--- page 674 ---
7. Options and SAR
(a) Term. No Option or SAR will be exercisable after the expiration of ten (10) years
from the date of its grant or such shorter period specified in the Share Award
Agreement;
(b) Exercise price. The exercise or strike price of each option or SAR granted to a US
grantee will be not less than one hundred percent (100%) of the fair market value
of the Shares subject to the Option or SAR on the date the Share Award is granted.
The exercise or strike price of each option or SAR granted to a Participant that is
not a U.S. Participant shall be determined by the Board and shall comply with
applicable laws. In addition, no option or SAR may be granted with an exercise or
strike price lower than the par value of the Shares, if any.
(c) Transferability. The Board may, in its sole discretion, impose such limitations on
the transferability of Options and SARs as the Board will determine.
(d) V esting. The total number of Shares subject to an option or SAR may vest and
become exercisable in periodic installments that may or may not be equal. The
Option or SAR may be subject to such other terms and conditions on the time or
times when it may or may not be exercised (which may be based on the satisfaction
of performance goals or other criteria) as the Board may deem appropriate.
(e) Termination of continuous service without cause or the disability or death of
grantee. If a grantee’s continuous service (as an employee, Director or consultant)
terminates (other than for cause), or in the event of the grantee’s disability or death,
the grantee, or the grantee’s estate or such other person entitled to exercise the
option or grantee, may exercise the grantee’s option or SAR within the applicable
timeframe as set forth in the Equity Incentive Plan and the Share Award Agreement.
(f) Termination for cause. Except as provided otherwise in a grantee’s Share Award
Agreement or other individual written agreement, if a grantee’s continuous service
is terminated for cause, the option or SAR will terminate and may not be exercised
immediately upon such employee’s termination of continuous service.
8. Restricted Share Awards
(a) Consideration. A restricted share award may be awarded in consideration for cash,
check or other form of legal consideration that may be acceptable to the Board in its
sole discretion, and permissible under applicable law.
(b) V esting. Shares awarded under the Restricted Share Award Agreement may be
subject to forfeiture to the Company in accordance with a vesting schedule to be
determined by the Board.
APPENDIX IV STATUTORY AND GENERAL INFORMATION
– IV-25 –


--- page 675 ---
(c) Termination of continuous service. If a grantee’s continuous service terminates, the
Company may receive through a forfeiture condition or a repurchase right, any or all
of the Shares held by the grantee as of the date of such termination under the terms
of the Restricted Share Award Agreement.
(d) Transferability. Rights to acquire Shares under the Restricted Share Award
Agreement will be transferable by the grantee only upon such terms and conditions
as are set forth in the Restricted Share Award Agreement, as the Board will
determine in its sole discretion, so long as such Shares remain subject to the terms
of the Restricted Share Award Agreement.
9. Restricted Share Unit Awards
(a) Consideration. At the time of grant of an RSU, the Board will determine the
consideration, if any, to be paid by the grantee upon delivery of each Share subject
to the RSU. The consideration (if any) may be paid in any form of legal
consideration that may be acceptable to the Board, in its sole discretion, and
permissible under applicable law.
(b) V esting. The Board may impose such restrictions on or conditions to the vesting of
the RSU as it, in its sole discretion, deems appropriate.
(c) Payment . An RSU may be settled by the delivery of Shares, their cash equivalent,
any combination thereof or in any other form of consideration, as determined by the
Board and contained in the RSU Award Agreement.
(d) Termination of continuous service. Except as otherwise provided in the applicable
RSU Award Agreement, such portion of the RSU that has not vested will be forfeited
upon the grantee’s termination of continuous service.
10. Other Share Awards
(a) the Board will have sole and complete authority to determine the persons to whom
and the time or times at which such other Share Awards will be granted, the number
of Shares (or the cash equivalent thereof) to be granted and all other terms and
conditions of such other Share Awards.
APPENDIX IV STATUTORY AND GENERAL INFORMATION
– IV-26 –


--- page 676 ---
11. Establishment of the Employee Trust and Escrow and Mr. Lu’s Trust
Employee Trust and Escrow
On March 29, 2021, the Company (as the settlor) and Tricor Trust (Hong Kong) Limited
(“Tricor HK”), an Independent Third Party, entered into (i) a trust deed for the administration
of the Equity Incentive Plan for the establishment and operation of the PRC trust (the “PRC
Employee Trust”); and (ii) a deed of settlement in relation to the escrow arrangement for the
establishment and operation of the U.S. Employee Escrow. All of the Shares held by the PRC
Employee Trust and the U.S. Employee Escrow were non-voting Shares, which would be
converted into the Shares of the Company upon the completion of the Global Offering.
The PRC Employee Trust is established for the purpose of administering awards which
may be granted to employees and consultants (each as defined thereunder) of PRC nationality.
Pursuant to the PRC Employee Trust arrangement, Tricor HK has agreed to act as the trustee
to hold through VP EIP NUS LIMITED certain Shares underlying the RSUs that have been or
may be granted under the Equity Incentive Plan and to administer the vesting of the RSUs. The
U.S. Employee Escrow is established for the purpose of administering awards which may be
granted to employees and consultants (each as defined thereunder) of U.S. Nationality.
Pursuant to the U.S. Employee Escrow arrangement, Tricor HK has agreed to act as the agent
to hold through VP EIP US LIMITED certain Shares underlying the RSUs that have been
granted under the Equity Incentive Plan and to administer the vesting of the RSUs. The PRC
Employee Trust and the U.S. Employee Escrow operate independently, and there are no
overlapping grantees holding interests under both of the them. With respect to the
administration of the awards underlying the PRC Employee Trust and U.S. Employee Escrow,
Tricor HK, an Independent Third Party, acting as the trustee/agent, from time to time receives
notices from administrator of the plan regarding the granting and vesting arrangement.
Following such notices, Tricor HK performs its duties accordingly in accordance with the
terms of the Equity Incentive Plan and the trust deeds, e.g., by registering the grantees as
beneficiaries, delivery Shares or their cash equivalent, etc.
On March 30, 2021, the Company issued and allotted to VP EIP NUS LIMITED and VP
EIP US LIMITED 11,000,000 Shares and 4,000,000 Shares, respectively, for the operation of
the Equity Incentive Plan. On November 15, 2022, the Company entered into share surrender
agreements with VP EIP NUS LIMITED and VP EIP US LIMITED, pursuant to which VP EIP
NUS LIMITED surrendered for no consideration of 7,859,500 Shares, VP EIP US LIMITED
surrendered for no consideration of 2,800,000 Shares. The surrendered shares were canceled
accordingly on November 16, 2022. On February 17, 2025, the Company entered into a share
surrender agreement with VP EIP NUS LIMITED, pursuant to which VP EIP NUS LIMITED
surrendered for no consideration of 765,000 Shares. The surrendered shares were canceled
accordingly on February 18, 2025. On February 18, 2025, the Company issued 330,000 Shares
to VP EIP US LIMITED without consideration. As a result, VP EIP NUS LIMITED and VP EIP
US LIMITED holds 2,375,500 and 1,530,000 non-voting Shares in the Company, respectively.
All the Shares issued and allotted by the Company to VP EIP NUS LIMITED and VP EIP US
LIMITED were non-voting Shares, which would be converted into the Shares of the Company
upon the completion of the Global Offering.
APPENDIX IV STATUTORY AND GENERAL INFORMATION
– IV-27 –


--- page 677 ---
Mr. Lu’s Trust
On March 10, 2021, the Board approved the grant of RSUs representing 5,000,000 Shares
to Mr. Lu An-bang (“Mr. Lu”) under the Equity Incentive Plan, and the relevant grant
documents were entered into on March 15, 2021. Shares underlying the RSUs granted to Mr. Lu
were issued and allotted to Mr. Lu on March 30, 2021.
On March 29, 2021, Mr. Lu (as the settlor), established the VPP Trust with Tricor Equity
Trustee Limited (“Tricor Trustee”), an Independent Third Party, acting as the trustee. On the
same date, Mr. Lu transferred the 5,000,000 Shares underlying Mr. Lu’s RSUs to VPP LU
Limited by way of gift. Tricor Trustee holds through VPP LU Limited the 5,000,000 Shares for
the benefit of beneficiaries which include, among others, Mr. Lu and his family members. All
the Shares held by VPP LU Limited were non-voting Shares, which would be converted into
the Shares of the Company upon the completion of the Global Offering.
12. Outstanding Grants
As of the Latest Practicable Date, there were outstanding RSUs representing 8,905,500
Shares that had been granted to 24 grantees under the Equity Incentive Plan, among which
RSUs representing 5,000,000 Shares were granted to Mr. Lu and held by VPP LU Limited, and
RSUs representing 3,905,500 Shares have been granted to other grantees of the Company and
held by VP EIP NUS LIMITED and VP EIP US LIMITED. The details of the grants are
disclosed in the table below. Expect for the above, no further RSUs will be granted pursuant
to the Equity Incentive Plan prior to the Listing. As such, at the time of Listing, save as Mr.
Lu, no Director or core connected person of the Company will be a grantee under the Equity
Incentive Plan. Therefore the Shares held by VP EIP NUS LIMITED and VP EIP US LIMITED
would count towards public float. Further, there are no overlapping grantees holding interests
in both VP EIP NUS LIMITED and VP EIP US LIMITED.
All the Shares underlying the awards granted under Equity Incentive Plan have been
allotted and issued and are held by PRC Employee Trust, U.S. Employee Escrow and Mr. Lu’s
Trust through their respective nominee entities as of the Latest Practicable Date. Accordingly,
the vesting of RSUs granted under the Equity Incentive Plan will not cause any dilution effect
on the shareholdings of our Shareholders nor any impact on the earnings per Share arising from
the vesting of RSUs.
APPENDIX IV STATUTORY AND GENERAL INFORMATION
– IV-28 –


--- page 678 ---
The table below shows the details of Awards granted under the Equity Incentive Plan that
are outstanding as of the Latest Practicable Date.
Grantee
Position/
Relationship
Number of Shares
under outstanding
Awards granted as
of the date of this
Prospectus and
immediately before
the completion of
the Global Offering
Date of
Grant
Vesting
Period
Exercise
price (US$
per Share)
Consideration
paid by the
Grantee
Approximately
percentage in the
issued Shares
immediately after
completion of the
Global Offering and
assuming the Offer
Size Adjustment
Option and the
Over-allotment
option are not
exercised
Directors
LU An-Bang ( ጅτԞ) Chief Executive
Officer
5,000,000 March 15,
2021
Note 1 Nil Nil 4.45%
Subtotal 5,000,000 4.45%
Senior management of our Company who are not Directors
CHEN Jun (ࠏChief Commercial
Officer
1,000,000 August 30,
2021
Note 1 Nil Nil 0.89%
200,000 March 3,
2025
Note 2 Nil Nil 0.18%
330,000 March 3,
2025
Note 4 Nil Nil 0.29%
Subtotal 1,530,000 1.36%
Other employees of our Group
Du Nan ( Ӂ฻) Clinical Science
Director
40,000 March 15,
2021
Note 1 Nil Nil 0.036%
3,000 March 3,
2025
Note 3 Nil Nil 0.003%
Li Ying ( ҽ጑) Biostatistic Statistician
Director
40,000 March 15,
2021
Note 1 Nil Nil 0.036%
3,000 March 3,
2025
Note 3 Nil Nil 0.003%
Chen Rui ( ௓ြ) Clinical Operation VP 30,000 March 15,
2021
Note 1 Nil Nil 0.027%
190,000 March 3,
2025
Note 4 Nil Nil 0.169%
Wang Chao ( ˮ൴) Legal & Compliance
Senior Director
20,000 March 15,
2021
Note 1 Nil Nil 0.018%
30,000 March 3,
2025
Note 2 Nil Nil 0.027%
90,000 March 3,
2025
Note 4 Nil Nil 0.080%
APPENDIX IV STATUTORY AND GENERAL INFORMATION
– IV-29 –


--- page 679 ---
Grantee
Position/
Relationship
Number of Shares
under outstanding
Awards granted as
of the date of this
Prospectus and
immediately before
the completion of
the Global Offering
Date of
Grant
Vesting
Period
Exercise
price (US$
per Share)
Consideration
paid by the
Grantee
Approximately
percentage in the
issued Shares
immediately after
completion of the
Global Offering and
assuming the Offer
Size Adjustment
Option and the
Over-allotment
option are not
exercised
Zhang Xiaoxu ( ੵወϛ) HR Director 10,000 March 15,
2021
Note 2 Nil Nil 0.009%
3,000 March 3,
2025
Note 3 Nil Nil 0.003%
30,000 March 3,
2025
Note 2 Nil Nil 0.027%
90,000 March 3,
2025
Note 4 Nil Nil 0.080%
Shan Wei ( ఊ⒜) Finance Director 7,500 March 15,
2021
Note 2 Nil Nil 0.007%
3,000 March 3,
2025
Note 3 Nil Nil 0.003%
30,000 March 3,
2025
Note 2 Nil Nil 0.027%
90,000 March 3,
2025
Note 4 Nil Nil 0.080%
Hao Zhixin ( ৠႦอ) RWE Associate
Director
5,000 March 15,
2021
Note 2 Nil Nil 0.004%
Tian Y an ( ͞Ѹ) Clinical Data
Management
Associate Director
5,000 March 15,
2021
Note 2 Nil Nil 0.004%
Wang Weifeng ( ˮሊቜ) Drug Supply Senior
Manager
5,000 March 15,
2021
Note 2 Nil Nil 0.004%
Wei Wenwen ( ሊතත) C&B Manager 2,500 March 15,
2021
Note 2 Nil Nil 0.002%
Dong Xiaowei ( ໨ወਃ) Clinical Operation PM 2,500 March 15,
2021
Note 2 Nil Nil 0.002%
Y e Y udie (ሁ) Accounting Manager 3,750 March 15,
2021
Note 2 Nil Nil 0.003%
3,000 March 3,
2025
Note 3 Nil Nil 0.003%
APPENDIX IV STATUTORY AND GENERAL INFORMATION
– IV-30 –


--- page 680 ---
Grantee
Position/
Relationship
Number of Shares
under outstanding
Awards granted as
of the date of this
Prospectus and
immediately before
the completion of
the Global Offering
Date of
Grant
Vesting
Period
Exercise
price (US$
per Share)
Consideration
paid by the
Grantee
Approximately
percentage in the
issued Shares
immediately after
completion of the
Global Offering and
assuming the Offer
Size Adjustment
Option and the
Over-allotment
option are not
exercised
Lu Y un ( ጅථ) Admin Supervisor 3,750 March 15,
2021
Note 2 Nil Nil 0.003%
3,000 March 3,
2025
Note 3 Nil Nil 0.003%
An Muxi ( τᅉ๣) Clinical Project
Assistant
2,500 March 15,
2021
Note 2 Nil Nil 0.002%
Gu Qing (ڡMedical Affairs VP 30,000 August 30,
2021
Note 1 Nil Nil 0.027%
80,000 March 3,
2025
Note 2 Nil Nil 0.071%
190,000 March 3,
2025
Note 4 Nil Nil 0.169%
Pan Haifeng (ࠬCommercial
Operations VP
50,000 August 30,
2021
Note 1 Nil Nil 0.044%
80,000 March 3,
2025
Note 2 Nil Nil 0.071%
190,000 March 3,
2025
Note 4 Nil Nil 0.169%
Wang Y an ( ˮዲ) Clinical Development
Senior VP
50,000 March 17,
2022
Note 1 Nil Nil 0.044%
80,000 March 3,
2025
Note 2 Nil Nil 0.071%
190,000 March 3,
2025
Note 4 Nil Nil 0.169%
Guo Yi ( ᪆ᆇ) Business Development
VP
50,000 March 17,
2022
Note 1 Nil Nil 0.044%
80,000 March 3,
2025
Note 2 Nil Nil 0.071%
20,000 March 3,
2025
Note 1 Nil Nil 0.018%
190,000 March 3,
2025
Note 4 Nil Nil 0.169%
APPENDIX IV STATUTORY AND GENERAL INFORMATION
– IV-31 –


--- page 681 ---
Grantee
Position/
Relationship
Number of Shares
under outstanding
Awards granted as
of the date of this
Prospectus and
immediately before
the completion of
the Global Offering
Date of
Grant
Vesting
Period
Exercise
price (US$
per Share)
Consideration
paid by the
Grantee
Approximately
percentage in the
issued Shares
immediately after
completion of the
Global Offering and
assuming the Offer
Size Adjustment
Option and the
Over-allotment
option are not
exercised
Zhu Jing ( ϡ᎑) CMC Senior Director 20,000 March 17,
2022
Note 1 Nil Nil 0.018%
30,000 March 3,
2025
Note 2 Nil Nil 0.027%
90,000 March 3,
2025
Note 4 Nil Nil 0.080%
Lin Baiyou (С) Taiwan Operation VP 50,000 March 17,
2022
Note 1 Nil Nil 0.044%
Wang Zhiquan ( ӓ౽Ό) Clinical Science
Director
20,000 March 3,
2025
Note 1 Nil Nil 0.018%
30,000 March 3,
2025
Note 2 Nil Nil 0.027%
90,000 March 3,
2025
Note 4 Nil Nil 0.080%
Du Chaofu ( Ӂ൴ӱ) Director of Quality
GMP
20,000 March 3,
2025
Note 1 Nil Nil 0.018%
Subtotal 2,375,500 2.113%
Total 8,905,500 7.920%
Note:
(1) The Awards shall vest over a period of four years, contingent upon the Company’s successful listing.
Additionally, as detailed in each Grantee’s notice of Award and respective Award agreements, the vesting of
these Awards may be subject to several other objective conditions, including achievement of specified
milestones, the Grantee’s continuous service with the Company or its affiliates, and the fulfillment of
performance criteria. These performance criteria involve meeting key performance indicators that are
established based on objective standards set by the Company for the individual Grantee.
(2) The Awards shall vest over a period of four years, contingent upon the Company’s successful listing.
(3) The Awards shall vest over a period of three years, contingent upon the Company’s successful listing.
(4) As detailed in each Grantee’s notice of Award and respective Award agreements, the vesting of these Awards
may be subject to several other objective conditions, including the Grantee’s continuous service with the
Company or its affiliates, and the performance of the Company’s Share price.
APPENDIX IV STATUTORY AND GENERAL INFORMATION
– IV-32 –


--- page 682 ---
E. POST-IPO SHARE A W ARD SCHEME
The following is a summary of the principal terms of the Post-IPO Share Award Scheme
conditionally adopted by the Shareholders’ resolutions dated November 16, 2022, effective
from the Listing Date. The terms of the Post-IPO Share Award Scheme are compliant with the
provisions of Chapter 17 of the Listing Rules.
1. Purpose
The purpose of the Post-IPO Share Award Scheme is to align the interests of eligible
participants with those of our Group through ownership of Shares, dividends and other
distributions paid on Shares and/or the increase in value of the Shares, and to encourage and
retain eligible participants to make contributions to the long-term growth and profits of our
Group. No performance target is attached to the Post-IPO Share Award Scheme. The Board and
the committee of the Board or person(s) to which the Board has delegated its authority shall
have the power from time to time, as part of the terms and conditions of any Award (as defined
below), to specify the performance targets that must be satisfied before the vesting of the
Award pursuant to the terms of the Post-IPO Share Award Scheme.
2. Eligible Participants
Any individual/entity, being an employee, service provider or any director or employee
of any holding companies, fellow subsidiaries or associated companies of the Company (the
“Related Entities”, each a “Related Entity”), who the Board or its delegate(s) considers, in its
sole discretion, to have contributed or will contribute to our Group is eligible to receive an
Award. However, no individual who is resident in a place where the grant, acceptance or
vesting of an Award pursuant to the Post-IPO Share Award Scheme is not permitted under the
laws and regulations of such place or where, in the view of the Board, compliance with
applicable laws and regulations in such place makes it necessary or expedient to exclude such
individual, shall be entitled to participate in the Post-IPO Share Award Scheme.
3. Awards
An Award gives a selected participant a conditional right, when the Shares vest, to obtain
the Shares or, if in the absolute discretion of the Board or its delegate(s), it is not practicable
for the selected participant to receive the Award in Shares, the cash equivalent from the sale
of the Shares. An Award includes all cash income from dividends in respect of those Shares
from the date the Award is granted (“Grant Date”) to the date the Award vests (“V esting Date”).
For the avoidance of doubt, the Board at its discretion may from time to time determine that
any dividends declared and paid by our Company in relation to the Shares be paid to the
selected participant even though the Shares have not yet vested.
APPENDIX IV STATUTORY AND GENERAL INFORMATION
– IV-33 –


--- page 683 ---
4. Grant of Award
The Board or the committee of the Board or person(s) to which the Board has delegated
its authority may, from time to time, at their absolute discretion, grant an Award to a selected
participant (in the case of the Board’s delegate(s), to any selected participant other than a
Director or an officer of our Company) by way of an award letter (“Award Letter”). The Award
Letter will specify the Grant Date, the number of Shares underlying the Award, the vesting
criteria and conditions, the V esting Date and such other details as the Board or its delegate(s)
may consider necessary.
Each grant of an Award to any selected participant who is a Director, chief executive or
substantial shareholder of the Company, or any of their respective associates, shall be subject
to the prior approval of the independent non-executive Directors (excluding any independent
non-executive Director who is a proposed recipient of the grant of an Award). Our Company
will comply with the relevant requirements under Chapter 14A and Chapter 17 of the Listing
Rules for any grant of shares to connected persons and Director, chief executive or substantial
shareholder or any of their respective associates of our Company.
The Board and its delegate(s) may not grant any Shares to any selected participant in
certain circumstances, including the following:
(i) where any applicable approval from any applicable regulatory authorities has not
been granted;
(ii) where any member of our Group will be required under applicable securities laws,
rules or regulations to issue a prospectus or other offer documents in respect of such
Award or the Post-IPO Share Award Scheme, unless the Board determines otherwise;
(iii) where such Award would result in a breach by any member of our Group or its
directors of any applicable securities laws, rules or regulations in any jurisdiction;
(iv) where the Company or any eligible participant is in possession of unpublished inside
information in relation to our Company or where dealings by Directors are
prohibited under any code or requirement of the Listing Rules and all applicable
laws, rules or regulations, from time to time;
(v) during the period of one month immediately preceding the earlier of (i) the date of
the meeting of the Board (as such date is first notified by the Company to the Stock
Exchange in accordance with the Listing Rules) for approving the Company’s results
of any year, half-year, quarterly or any other interim period (whether or not required
under the Listing Rules); and (ii) the deadline for the Company to announce its
results for any year or half-year under the Listing Rules (whether or not required
under the Listing Rules), and ending on the date of the results announcement. No
Award may be granted during any period of delay in publishing a results
announcement.
APPENDIX IV STATUTORY AND GENERAL INFORMATION
– IV-34 –


--- page 684 ---
5. Maximum number of Shares available for subscription
The total number of Shares which may be issued upon vesting of all Awards to be granted
under the Post-IPO Share Award Scheme and any grants under any other share option scheme
and/or share award scheme involving issuance of new Shares adopted and to be adopted by the
Company from time to time (the “Share Schemes (New Shares)”) after the Listing Date in
compliance with Chapter 17 of the Listing Rules is 10,659,500 (the “Scheme Mandate Limit”).
Awards and options lapsed/forfeited in accordance with the rules of the Post-IPO Share Award
Scheme or the terms of any Share Schemes (New Shares) will not be regarded as utilized for
the purpose of calculating the Scheme Mandate Limit. The Scheme Mandate Limit represents
approximately 9.5% of the total issued shares of the Company (excluding treasury shares) upon
completion of the Global Offering (assuming the Offer Size Adjustment Option and the
Over-allotment Option are not exercised and no Shares are issued under the Post-IPO Share
Award Scheme). As approved by the Board and the Shareholders on March 8, 2025, subject to
the Scheme Mandate Limit, the current maximum number of Shares that may be issued upon
vesting of all Awards to be granted under this Post-IPO Share Award Scheme is 2,399,500
Shares.
The total number of Shares which may be issued in respect of all Awards to be granted
to all service providers under the Post-IPO Share Award Scheme shall not exceed 3% of the
Scheme Mandate Limit (the “Service Provider Sublimit”).
The Company may seek approval by its Shareholders in general meeting for refreshment
of the Scheme Mandate Limit and the Service Provider Sublimit pursuant to the relevant terms
of the Post-IPO Share Award Scheme and in accordance with relevant Listing Rules. The total
number of Shares which may be issued in respect of all options and awards to be granted under
the Post-IPO Share Award Scheme and Share Schemes (New Shares) as refreshed shall not
exceed 10% of the relevant class of Shares in issue (excluding treasury shares) as at the date
of approval of the refreshed scheme mandate. Options and awards previously granted under
this Post-IPO Share Award Scheme and any other Share Schemes (New Shares) of the
Company (including those outstanding, cancelled or lapsed in accordance with its terms or
exercised), shall not be counted for the purpose of calculating the limit as refreshed.
The Company may seek separate approval by its Shareholders in general meeting for
granting Awards beyond the Scheme Mandate Limit, provided that the Awards in excess of the
Scheme Mandate Limit are granted only to selected employee specifically identified by the
Company before such approval is sought. The Company must send a circular to the
Shareholders in accordance with the relevant requirements under the Listing Rules.
The maximum number of the shares which may be awarded to a selected participant under
the Post-IPO Share Award Scheme and any other Share Scheme (New Shares) in any 12-month
period shall not exceed 1% of the issued share capital of the Company in issue (excluding
treasury shares) (the “Individual Limit”). If any grant of Award to an individual selected
participant would result in the Shares issued and to be issued in respect of all options and
awards granted to such selected participant in the 12-month period up to and including the date
of such grant representing in aggregate exceeding the Individual Limit, such grant must be
separately approved by Shareholders in general meeting with such selected participant and his
close associates (or associates if the selected participant is a connected person) abstaining from
voting. In such case, the Company shall send a circular to the Shareholders in accordance with
the relevant requirements under the Listing Rules.
APPENDIX IV STATUTORY AND GENERAL INFORMATION
– IV-35 –


--- page 685 ---
If the Company conducts a share consolidation or subdivision, the maximum number of
Shares that may be issued in respect of all Awards to be granted under the Post-IPO Share
Award Scheme, as a percentage of the total number of issued shares at the date immediately
before and after such consolidation or subdivision shall be the same, rounded to the nearest
whole share.
6. Scheme Mandate
To the extent that the Scheme Mandate Limit is subsequently increased by way of
alteration of the Post-IPO Share Award Scheme and our Company is required to issue and allot
new shares to satisfy any Awards in excess of any amount previously approved by our
Shareholders (as the case may be), our Company shall at a general meeting propose, and the
Shareholders shall consider and, if thought fit, pass an ordinary resolution approving a mandate
specifying:
(i) the maximum number of new Shares that may be issued for this purpose; and
(ii) that the Board has the power to issue, allot, procure the transfer of and otherwise
deal with the Shares in connection with the Post-IPO Share Award Scheme;
the mandate will remain in effect during the period from the passing of the ordinary resolution
granting the mandate until the variation or revocation of such mandate by an ordinary
resolution of the Shareholders in a general meeting.
7. Rights attached to the Award
Save that the Board at its discretion may from time to time determine that any dividends
declared and paid by our Company in relation to the Shares be paid to the selected participants
even though the Shares have not yet vested, the selected participant only has a contingent
interest in the Shares underlying an Award unless and until such Shares are actually transferred
to the selected participant, nor does he/she have any rights to any cash or non-cash income until
the Shares and related income vest.
8. Rights attached to the Shares
Any Shares transferred to a selected participant in respect of any Awards will be subject
to all the provisions of the Memorandum and Articles of Association and will form a single
class with the fully paid Shares in issue on the relevant date.
The Shares underlying the Awards granted, when allotted and issued, shall rank pari passu
among themselves and with the other Shares in issue.
APPENDIX IV STATUTORY AND GENERAL INFORMATION
– IV-36 –


--- page 686 ---
9. Assignment of Awards
Any Shares granted under the Post-IPO Share Award Scheme but not yet vested are
personal to the selected participants to whom they are granted and cannot be assigned or
transferred. A selected participant shall not in any way sell, transfer, charge, mortgage,
encumber or create any interest in favor of any other person over or in relation to any Award,
or enter into any agreement to do so. Subject to the approval by the Board and the Stock
Exchange, and compliance with Listing Rules, applicable laws and regulations, an Award may
be transferred to a vehicle (such as a trust or a private company) for the benefit of the selected
participant and any family member of such selected participant (e.g., for estate planning or tax
planning purposes) that would continue to meet the purpose of the Post-IPO Share Award
Scheme.
10. Vesting of Awards
The Board or its delegate(s) may from time to time while the Post-IPO Share Award
Scheme is in force and subject to all applicable laws, determine such vesting criteria and
conditions or periods for the Award to be vested.
The vesting period for any Award shall not be less than 12 months, provided that a shorter
vesting period may apply to the following:
(a) grants of “make-whole” Award to new joinders to replace the share awards they
forfeited when leaving the previous employer;
(b) grants to a participant whose employment is terminated due to death or occurrence
of any change in control event, in which the vesting of Awards may accelerate;
(c) grants with performance-based vesting conditions in lieu of time-based vesting
criteria;
(d) grants that are made in batches during a year for administrative and compliance
reasons; and
(e) grants with a mixed or accelerated vesting schedule such as where the awards may
vest evenly over a period of 12 months.
If there is an event of change in control of our Company by way of a merger, a
privatization of our Company by way of a scheme or by way of an offer, the Board or the
committee of the Board or person(s) to which the Board has delegated its authority shall at their
sole discretion determine whether the vesting dates of any Awards will be accelerated to an
earlier date.
APPENDIX IV STATUTORY AND GENERAL INFORMATION
– IV-37 –


--- page 687 ---
If necessary to comply with applicable laws, any selected participants who holds the
Shares under an Award shall dispose of such Shares: (1) within six (6) months after the
termination of employment by reason of retirement, death, permanent physical or mental
disablement; or (2) within three (3) months after termination of employment by reason other
than retirement, death, permanent physical or mental disablement or by reason of the
circumstances as described in section 12 paragraph 3.
11. Adjustment upon occurrence of relevant event
Upon the occurrence of any alteration in the share capital of the Company arising from
any capitalisation issue, reduction, sub-division or consolidation of share capital of the
Company, any rights issue of any share capital of the Company by way of capitalisation of
profits or reserves or in connection with an open offer to the Shareholders (except where Shares
are issued as consideration or part consideration in a transaction), the number of awarded
Shares may be adjusted in a manner as determined by the Board. The adjustment must give the
selected participant the same proportion of the awarded Shares, rounded to the nearest whole
share, as that to which he was previously entitled prior to such adjustments, but no such
adjustments may be made to the extent that a Share would be issued at less than its nominal
value (if any). In respect of any such adjustments, other than any made on a capitalization
issue, an independent financial adviser or the Company’s auditor shall confirm to the Board in
writing that the adjustments proposed satisfy the requirements set out in Rule 17.03(13) of the
Listing Rules. All fractional shares (if any) arising out of the consolidation or sub-division in
respect of the Shares of a selected participant shall be deemed as returned shares (“Returned
Shares”) and shall not be transferred to the relevant selected participant on the relevant V esting
Date.
12. Retirement, death or permanent physical or mental disability of an eligible
participant
If a selected participant ceases to be an eligible participant by reason of retirement of the
selected participant, any outstanding Shares and related income not yet vested shall be
immediately forfeited, unless the Board or its delegate(s) determines otherwise at their absolute
discretion.
If a selected participant ceases to be an eligible participant by reason of (i) death of the
selected participant; (ii) termination of the selected participant’s employment or contractual
engagement with our Group or the Related Entities by reason of his/her permanent physical or
mental disablement; or (iii) termination of the selected participant’s employment or contractual
engagement with our Group by reason of redundancy, any outstanding Shares and related
income not yet vested shall be immediately forfeited, unless the Board or its delegate(s)
determines otherwise at their absolute discretion.
APPENDIX IV STATUTORY AND GENERAL INFORMATION
– IV-38 –


--- page 688 ---
If a selected participant, being an employee whose employment is terminated by our
Group or a Related Entity by reason of the employer terminating the contract of employment
without notice or payment in lieu of notice, or the selected participant having been convicted
of any criminal offense involving his or her integrity or honesty, or the selected participant
having made any misstatement(s) in the Company’s financial statements, any outstanding
Shares and related income not yet vested shall be immediately forfeited, unless the Board or
its delegate(s) determines otherwise at their absolute discretion.
13. Grant of Shares under the Post-IPO Share Award Scheme
As of the date of this document, no Shares have been granted or agreed to be granted
under the Post- IPO Share Award Scheme.
Application has been made to the Listing Committee for the listing of, and permission to
deal in, the Shares which may be issued pursuant to the Post-IPO Share Award Scheme.
14. Duration and termination
The Post-IPO Share Award Scheme shall be valid and effective for ten years from the
Listing Date (the “Award Period”) (after which no Awards will be granted), and thereafter for
so long as there are any non-vested Shares granted prior to the expiration of the Post-IPO Share
Award Scheme, in order to give effect to the vesting of such Shares or otherwise as may be
required in accordance with the rules of the Post-IPO Share Award Scheme. Subject to the
foregoing, the Board may at any time resolve to terminate the operation of this Post-IPO Share
Award Scheme prior to the expiry of the Award Period and in such event no further Awards will
be offered or granted, but the provisions of this Post-IPO Share Award Scheme shall remain in
full force to the extent necessary to give effect to any subsisting rights of any selected
participants under the Post-IPO Share Award Scheme. Awards complying with the provisions
of Chapter 17 of the Listing Rules which are granted during the life of this Post-IPO Share
Award Scheme and in respect of which Shares are not yet issued prior to the termination of the
operation of this Post-IPO Share Award Scheme shall continue to be valid in accordance with
their terms of issue after the termination of this Post-IPO Share Award Scheme.
15. Administration by trustee
Without prejudice to the Board’s general power of administration, to the extent not
prohibited by applicable laws and regulations, the Board or the committee of the Board or
persons to which the Board has delegated its authority may from time to time appoint one or
more trustees in respect of granting administration or vesting of any Shares under the Post-IPO
Share Award Scheme.
APPENDIX IV STATUTORY AND GENERAL INFORMATION
– IV-39 –


--- page 689 ---
Subject to the rules of the Post-IPO Share Award Scheme:
(i) our Company shall, as soon as reasonably practicable and no later than 30 business
days from the Grant Date, for the purposes of satisfying the grant of awards, issue
and allot Shares to the trustee and/or transfer to the trust the necessary funds and
instruct the trustee to acquire Shares through on-market transactions at the
prevailing market price; and
(ii) our Company shall instruct the trustee whether or not to apply any Returned Shares
to satisfy any grant of Awards made, and if the Returned Shares, as specified by our
Company, are not sufficient to satisfy the Awards granted, our Company shall as
soon as reasonably practicable and no later than 30 business days from the Grant
Date, for purposes of satisfying the Awards granted, issue and allot further Shares
to the trustee and/or transfer to the trust the necessary funds and instruct the trustee
to acquire further Shares through on-market transactions at the prevailing market
price.
Where the trustee has received instructions from our Company to acquire shares through
on-market transactions, the trustee shall acquire such number of Shares as instructed by our
Company on-market at the prevailing market price as soon as reasonably practicable after
receiving the necessary funds from our Company. The trustee shall only be obliged to transfer
Shares granted (and the related income derived from such Shares) to selected participants on
vesting to the extent that Shares granted (and the related income derived from such Shares) are
comprised in the trust.
F. OTHER INFORMATION
1. Estate duty
Our Directors have been advised that no material liability for estate duty is likely to fall
on any member of our Group.
2. Litigation and claims
As of the Latest Practicable Date, save as disclosed in this document, we are not aware
of any other litigation or arbitration proceedings of material importance pending or threatened
against us or any of our Directors that could have a material adverse effect on our financial
condition or operating results.
APPENDIX IV STATUTORY AND GENERAL INFORMATION
– IV-40 –


--- page 690 ---
3. Joint Sponsors
The Joint Sponsors have made an application on our behalf to the Listing Committee for
the listing of, and permission to deal in, the Shares in issue, the Shares to be issued pursuant
to the Global Offering (including any Shares that may be issued pursuant to the Offer Size
Adjustment Option and the Over-allotment Option) and the Shares which may be issued
pursuant to the Post-IPO Share Award Scheme.
The Joint Sponsors satisfy the independence criteria applicable to sponsors set forth in
Rule 3A.07 of the Listing Rules. The Joint Sponsors will receive an aggregate fee of
US$1,000,000 for acting as the sponsor for the Listing.
4. Compliance adviser
Our Company has appointed Somerley Capital Limited to act as the compliance adviser
upon Listing in compliance with Rule 3A.19 of the Listing Rules.
5. Preliminary expenses
We have not incurred any material preliminary expenses in relation to the incorporation
of our Company.
6. Promoter
We have no promoter for the purpose of the Listing Rules. Save as disclosed in this
document, within the two years immediately preceding the date of this document, no cash,
securities or other benefit has been paid, allotted or given nor are any proposed to be paid,
allotted or given to any promoters in connection with the Global Offering and the related
transactions described in this document.
7. Qualification of experts
The following sets forth the qualifications of the experts who have given opinion or
advice contained in this document:
Name Qualifications
Morgan Stanley Asia Limited A licensed corporation to conduct Type 1 (dealing
in securities), Type 4 (advising on securities), Type
5 (advising on futures contracts), Type 6 (advising
on corporate finance) and Type 9 (asset
management) regulated activities under the SFO
APPENDIX IV STATUTORY AND GENERAL INFORMATION
– IV-41 –


--- page 691 ---
Name Qualifications
Jefferies Hong Kong Limited A licensed corporation to conduct Type 1 (dealing
in securities), Type 4 (advising on securities) and
Type 6 (advising on corporate finance) regulated
activities under the SFO
Ernst & Y oung Certified Public Accountants
Registered Public Interest Entity Auditor
Frost & Sullivan International
Limited
Industry Consultant
Travers Thorp Alberga Legal adviser as to Cayman Islands laws
JunHe LLP Legal adviser as to PRC laws
8. Consent of experts
Each of the experts named in paragraph 7 above has given and has not withdrawn its
written consent to the issue of this document with the inclusion of its report, letter or opinion
(as the case may be) and the references to its name or summary of report, letter or opinion
included in this document in the form and context in which they respectively appear.
None of the experts named in paragraph 7 above has any shareholder interests in any
member of our Group or the right (other than the penal provisions) of sections 44A of the
Companies (Winding Up and Miscellaneous Provisions) Ordinance insofar as applicable.
9. Binding effect
This document shall have the effect, if an application is made in pursuance of this
document, of rendering all persons concerned bound by all of the provisions (other than the
penal provisions) of sections 44A and 44B of the Companies (Winding Up and Miscellaneous
Provisions) Ordinance insofar as applicable.
10. Registration procedures
The principal register of members of our Company will be maintained in the Cayman
Islands by our Principal Share Registrar and a branch register of members of our Company will
be maintained in Hong Kong by our Hong Kong Branch Share Registrar. Save where our
Directors otherwise agree, all transfers and other documents of title to Shares must be lodged
for registration with, and registered by, our Hong Kong Branch Share Registrar and may not
be lodged in the Cayman Islands.
APPENDIX IV STATUTORY AND GENERAL INFORMATION
– IV-42 –


--- page 692 ---
11. Miscellaneous
Save as disclosed in this document:
(a) within the two years immediately preceding the date of this document:
(i) no share or loan capital of our Company or any of our subsidiaries has been
issued or agreed to be issued or is proposed to be fully or partly paid either for
cash or a consideration other than cash;
(ii) no share or loan capital of our Company or any of our subsidiaries is under
option or is agreed conditionally or unconditionally to be put under option;
(iii) no founders or management or deferred shares of our Company or any of our
subsidiaries have been issued or agreed to be issued;
(iv) no commissions, discounts, brokerages or other special terms have been
granted or agreed to be granted in connection with the issue or sale of any share
or loan capital of our Company or any of our subsidiaries; and
(v) no commission has been paid or is payable for subscription, agreeing to
subscribe, procuring subscription or agreeing to procure subscription of our
Share or any share in any of our subsidiaries.
(b) Save as disclosed in this document, we had not issued any debentures nor did it have
any outstanding debentures or any convertible debt securities.
(c) Directors confirm that:
(i) there has been no material adverse change in our financial or trading position
or prospects of our Group since September 30, 2024 (being the date to which
the latest audited consolidated financial statements of our Group were
prepared); and
(ii) there is no arrangement under which future dividends are waived or agreed to
be waived; and
(iii) there has not been any interruption in the business of our Group which may
have or has had a significant effect on the financial position of our Group in
the 12 months preceding the date of this document.
APPENDIX IV STATUTORY AND GENERAL INFORMATION
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(d) Our principal register of members will be maintained by International Corporation
Services Ltd., in the Cayman Islands and our Hong Kong register of members will
be maintained by Computershare Hong Kong Investor Services Limited, in Hong
Kong. Unless the Directors otherwise agree, all transfer and other documents of title
of Shares must be lodged for registration with and registered by our Branch
Registrar and may not be lodged in the Cayman Islands.
(e) All necessary arrangements have been made to enable our Shares to be admitted into
CCASS for clearing and settlement.
(f) No company within our Group is presently listed on any stock exchange or traded
on any trading system.
12. Bilingual prospectus
The English and Chinese language versions of this document are being published
separately, in reliance upon the exemption provided by section 4 of the Companies (Exemption
of Companies and Prospectuses from Compliance with Provisions) Notice (Chapter 32L of the
Laws of Hong Kong).
APPENDIX IV STATUTORY AND GENERAL INFORMATION
– IV-44 –


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1. DOCUMENTS DELIVERED TO THE REGISTRAR OF COMPANIES
The documents attached to the copy of this document and delivered to the Registrar of
Companies in Hong Kong for registration were (i) the written consents referred to in the
section headed “Appendix IV – F. Other Information – 8. Consent of Experts” to this document,
and (ii) copies of each of the material contracts referred to in the section headed “Appendix IV
– B. Further Information About Our Business – 1. Summary of Material Contracts” to this
document.
2. DOCUMENTS ON DISPLAY
Copies of the following documents will be on display on the website of the Stock
Exchange at www.hkexnews.hk and our website at www.visenpharma.com during a period of
14 days from the date of this document:
(a) our Memorandum and Articles of Association;
(b) the Cayman Companies Act;
(c) the Accountants’ Report and the report on the unaudited pro forma financial
information of our Group prepared by Ernst & Y oung, the texts of which are set out
in Appendices I and IIA to this document;
(d) the audited consolidated financial information of our Company for the two financial
years ended December 31, 2022 and 2023 and nine months ended September 30,
2024;
(e) the legal opinions issued by JunHe LLP , our PRC Legal Adviser, in respect of certain
aspects of the Group and the property interests of our Group;
(f) the letter of advice prepared by Travers Thorp Alberga, our legal adviser on Cayman
Islands law, summarizing certain aspects of the Cayman Companies Act referred to
in Appendix III to this document;
(g) the industry report prepared by Frost & Sullivan International Limited referred to in
the section headed “Industry Overview” in this document;
(h) the material contracts referred to under the section headed “Appendix IV – Statutory
and General Information – B. Further Information about Our Business – 1. Summary
of Material Contracts” to this document;
APPENDIX V DOCUMENTS DELIVERED TO THE REGISTRAR OF
COMPANIES IN HONG KONG AND ON DISPLAY
– V-1 –


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(i) the service contracts and the letters of appointment with our Directors referred to in
“Statutory and General Information – C. Further Information about our Directors
and Substantial Shareholders – 2. Particulars of Directors’ Service Contracts and
Appointment Letters” in Appendix IV to this document;
(j) the written consents referred to under the paragraph headed “Statutory and General
Information – F. Other Information – 8. Consent of Experts” in Appendix IV to this
document; and
(k) the terms of the Equity Incentive Plan and Post-IPO Share Award Scheme.
APPENDIX V DOCUMENTS DELIVERED TO THE REGISTRAR OF
COMPANIES IN HONG KONG AND ON DISPLAY
– V-2 –


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