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Stock Code : 3378
(A joint stock company incorporated in the People’s Republic of China with limited liability)
翰思艾泰生物醫藥科技 ( 武漢 ) 股份有限公司
翰思艾泰生物醫藥科技 ( 武漢 ) 股份有限公司
Hanx Biopharmaceuticals (Wuhan) Co., Ltd.
翰思艾泰生物醫藥科技 ( 武漢 ) 股份有限公司
Hanx Biopharmaceuticals (Wuhan) Co., Ltd.
Hanx Biopharmaceuticals (Wuhan) Co., Ltd.
GLOBAL
OFFERING
Sole Sponsor, Overall Coordinator, Joint Global Coordinator and Joint Bookrunner
Overall Coordinators, Joint Global Coordinators and Joint Bookrunners


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If you are in any doubt about any of the contents of this prospectus, you should obtain independent professional advice.
Hanx Biopharmaceuticals (Wuhan) Co., Ltd.
ʮ̡
(A joint stock company incorporated in the People’ s Republic of China with limited liability)
GLOBAL OFFERING
Number of Offer Shares under the
Global Offering
: 18,321,000 H Shares (subject to the
Over-allotment Option)
Number of Hong Kong Offer Shares : 1,832,100 H Shares (subject to
reallocation)
Number of International Offer Shares : 16,488,900 H Shares (subject to
reallocation and the Over-allotment
Option)
Maximum Offer Price : HK$32.00 per Offer Share plus
brokerage of 1%, SFC transaction
levy of 0.0027%, the 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 : RMB0.1 per H Share
Stock code : 3378
Sole Sponsor, Overall Coordinator, Joint Global Coordinator and Joint
Bookrunner
Overall Coordinators, Joint Global Coordinators and Joint Bookrunners
Joint Global Coordinators and Joint Bookrunners
Joint Bookrunners
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
prospectus, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arisin g from or in reliance upon the whole or any part
of the contents of this prospectus.
A copy of this prospectus, having attached thereto the documents specified in the section headed “Documents Delivered to the Registrar of Companies i n Hong Kong and Documents on Display”
in Appendix VII to this prospectus, has been registered by the Registrar of Companies in Hong Kong as required by section 342C of the Companies (WUMP) Or dinance (Chapter 32 of the Laws
of Hong Kong). The Securities and Futures Commission of Hong Kong and the Registrar of Companies in Hong Kong take no responsibility for the contents of this prospectus or any of the other
documents referred to above.
The final Offer Price is expected to be determined by agreement between us and the Sponsor-Overall Coordinator (for itself and on behalf of the Underwr iters) on the Price Determination Date. The
Price Determination Date is expected to be on or around Friday, December 19, 2025. The Offer Price will be not more than HK$32.00 per Offer Share and is cu rrently expected to be not less than
HK$28.0 per Offer Share, unless otherwise announced. Investors applying for the Hong Kong Offer Shares may be required to pay, on application (subjec t to application channels), the maximum
Offer Price of HK$32.00 per Offer Share, together with brokerage of 1.0%, SFC transaction levy of 0.0027%, AFRC transaction levy of 0.00015% and the St ock Exchange trading fee of 0.00565%,
subject to refund if the Offer Price is less than HK$32.0 per Offer Shares. If, for any reason, the Offer Price is not agreed between us and the Sponsor-Ov erall Coordinator (for itself and on behalf
of the Underwriters) on or before 12:00 noon on Friday, December 19, 2025 (Hong Kong time), the Global Offering (including the Hong Kong Public Offerin g) will not proceed and will lapse.
The Sponsor-Overall Coordinator (for itself and on behalf of the Underwriters), with our consent, may reduce the indicative Offer Price range stated in this prospectus and/or reduce the number of
Offer Shares being offered pursuant to the Global Offering at any time on or prior to the morning of the last day for lodging applications under the Hong K ong Public Offering. In such a case, notices
of the reduction of the indicative Offer Price range and/or the number of Offer Shares will be published on the website of the Stock Exchange at www.hkexnews.hk and our website at
www.hanxbio.com . Further details are set out in the sections headed “Structure of the Global Offering” and “How to Apply for Hong Kong Offer Shares” in this prospectus. Prior to making an
investment decision, prospective investors should consider carefully all of the information set out in this prospectus, including the risk factors set out in the section headed “Risk Factors” in this
prospectus. The obligations of the Hong Kong Underwriters under the Hong Kong Underwriting Agreement are subject to termination by the Sponsor-Over all Coordinator (for itself and on behalf
of the Underwriters) if certain grounds arise prior to 8:00 a.m. on the Listing Date. Such grounds are set out in the section headed “Underwriting — Unde rwriting Arrangements and Expenses —
Hong Kong Public Offering — Hong Kong Underwriting Agreement — Grounds for Termination” in this prospectus. It is important that you refer to that sect ion for further details.
The Offer Shares have not been and will not be registered under the U.S. Securities Act or any state securities law in the United States and may not be offe red, sold, pledged or transferred within
the United States or to, or for the account or benefit of U.S. persons, except in transactions exempt from, or not subject to, the registration requirem ents of the U.S. Securities Act. The Offer Shares
are being offered and sold outside the United States in offshore transactions in reliance on Regulation S under the U.S. Securities Act.
ATTENTION
We have adopted a fully electronic application process for the Hong Kong Public Offering. We will not provide printed copies of this prospectus to the p ublic in relation to the Hong Kong Public
Offering.
This prospectus is available at the websites of the Stock Exchange ( www.hkexnews.hk ) and our Company www.hanxbio.com . If you require a printed copy of this prospectus, you may download
and print from the website addresses above.
IMPORTANT
December 15, 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 prospectus to the public
in relation to the Hong Kong Public Offering.
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.hanxbio.com. If you require a
printed copy of this prospectus, you may download and print from the website
addresses above.
To apply for the Hong Kong Offer Shares, you may:
(1) apply online through the HK eIPO White Form service at www.hkeipo.hk ;
(2) apply through the HKSCC EIPO channel to electronically cause HKSCC
Nominees to apply on your behalf, including by instructing your broker or
custodian who is a HKSCC Participant to submit an EIPO application on your
behalf through HKSCC’s FINI system in accordance with your instruction.
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
prospectus 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 prospectus is available online at the website
addresses above.
Please refer to the section headed “How to Apply for Hong Kong Offer Shares” in
this prospectus for further details of the procedures through which you can apply for the
Hong Kong Offer Shares electronically.
Y our application through the HK eIPO White Form service or the HKSCC EIPO
channel must be for a minimum of 100 Hong Kong Offer Shares and in one of the
numbers set out in the table below. If you are applying through the HK eIPO White
Form service, you may refer to the table below for the amount payable for the number
of H Shares you have selected. Y ou must pay the respective maximum amount payable
on application in full upon application for Hong Kong Offer Shares. If you are applying
IMPORTANT
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through the HKSCC EIPO channel, you are required to prefund your application based
on the amount specified by your broker or custodian, as determined based on the
applicable laws and regulations in Hong Kong.
No. of Hong
Kong Offer
Shares
applied for
Maximum
Amount
payable (2) on
application/
successful
allotment
No. of Hong
Kong Offer
Shares
applied for
Maximum
Amount
payable (2) on
application/
successful
allotment
No. of Hong
Kong Offer
Shares
applied for
Maximum
Amount
payable (2) on
application/
successful
allotment
No. of Hong
Kong Offer
Shares
applied for
Maximum
Amount
payable (2) on
application/
successful
allotment
(HK$) (HK$) (HK$) (HK$)
100 3,232.27 2,000 64,645.45 10,000 323,227.20 300,000 9,696,816.00
200 6,464.54 2,500 80,806.80 20,000 646,454.40 400,000 12,929,088.00
300 9,696.81 3,000 96,968.15 30,000 969,681.60 500,000 16,161,360.00
400 12,929.09 3,500 113,129.52 40,000 1,292,908.80 600,000 19,393,632.00
500 16,161.35 4,000 129,290.88 50,000 1,616,136.00 700,000 22,625,904.00
600 19,393.63 4,500 145,452.25 60,000 1,939,363.20 800,000 25,858,176.00
700 22,625.90 5,000 161,613.60 70,000 2,262,590.40 916,000
(1) 29,607,611.52
800 25,858.18 6,000 193,936.32 80,000 2,585,817.60
900 29,090.45 7,000 226,259.05 90,000 2,909,044.80
1,000 32,322.72 8,000 258,581.75 100,000 3,232,272.00
1,500 48,484.08 9,000 290,904.48 200,000 6,464,544.00
Notes:
(1) Maximum number of Hong Kong Offer Shares you may apply for and this is approximately 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) or to the HK eIPO White Form Service Provider (for
applications made through the application channel of the HK eIPO White Form service) while the
SFC transaction levy, the Stock Exchange trading fee and the AFRC transaction levy will be paid to
the SFC, the Stock Exchange and the AFRC, respectively.
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 website of the
Stock Exchange at www.hkexnews.hk and the website of our Company at
www.hanxbio.com.
Hong Kong Public Offering commences ...................... .9:00 a.m. on Monday,
December 15, 2025
Latest time to complete electronic applications under
the HK eIPO White Form service through
the designated website at www.hkeipo.hk (2): ...............1 1:30 a.m. on Thursday,
December 18, 2025
Application lists of the Hong Kong Public Offering open (3) ...... 1 1:45 a.m. on Thursday,
December 18, 2025
Latest time for (a) completing payment of HK eIPO
White Form 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 Thursday,
December 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 Hong Kong
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 Thursday,
December 18, 2025
Expected Price Determination Date (5) ............... o no r before 12:00 noon on Friday,
December 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
Public Offering to be published on the website of the
Stock Exchange at www.hkexnews.hk and the website
of our Company at www.hanxbio.com (6) on or before .......... 1 1:00 p.m. on Monday,
December 22, 2025
EXPECTED TIMETABLE (1)
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The results of allocations in the Hong Kong Public Offering
(with successful applicants’ identification document numbers,
where appropriate) to be available through a variety of
channels (as described in the section headed “How to Apply
for Hong Kong Offer Shares — B. Publication of Results”
in this prospectus), including:
 in the announcement to be posted on our website and
the website of the Stock Exchange at www.hkexnews.hk
and www.hanxbio.com respectively ...................... 1 1:00 p.m. on Monday,
December 22, 2025
 from the “Allotment Results” page in the
designated results of allocations website at
www.tricor.com.hk/ipo/result or
www.hkeipo.hk/IPOResult with a “search by ID”
function from ....................................... 1 1:00 p.m. on Monday,
December 22, 2025 to
12:00 midnight on
Sunday, December 28, 2025
 from the allocation results telephone enquiry line by
calling +852 3691 8488
between 9:00 a.m. and 6:00 p.m. from ...............T uesday, December 23, 2025
to Tuesday, December 30,
2025 (excluding
Saturday, Sunday
and public holiday
in Hong Kong)
H Share certificates in respect of wholly or partially
successful applications to be dispatched or deposited
into CCASS on or before
(7) ........................ .Monday, December 22, 2025
EXPECTED TIMETABLE (1)
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HK eIPO White Form e-Auto Refund payment instructions/
refund cheques in respect of wholly or partially successful
applications if the final Offer Price is less than
the maximum Offer Price per Offer Share initially paid on
application (if applicable) or wholly or partially unsuccessful
applications to be dispatched on or before
(8)(9) ..........................T uesday,
December 23, 2025
Dealings in the H Shares on the Stock Exchange expected
to commence at ....................................... 9:00 a.m. on Tuesday,
December 23, 2025
Notes :
(1) Unless otherwise stated, all times and dates refer to Hong Kong local times and dates.
(2) Y ou will not be permitted to submit your application through the designated website www.hkeipo.hk after
11:30 a.m. on the last day for submitting 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 the application monies) until 12:00
noon on the last day for submitting applications, when the application lists close.
(3) If there is/are a “black” rainstorm warning or a tropical cyclone warning signal number 8 or above and/or
Extreme Conditions in force in Hong Kong at any time between 9:00 a.m. and 12:00 noon on Thursday,
December 18, 2025, the application lists will not open or close on that day. For further details, please see the
section headed “How to Apply for Hong Kong Offer Shares — E. Bad Weather Arrangements” in this
prospectus.
(4) Applicants who apply for Hong Kong Offer Shares by giving electronic application instructions to HKSCC
via HKSCC’s FINI system 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 about Friday, December 19, 2025, and in any event, not
later than 12:00 noon on Friday, December 19, 2025. If, for any reason, the Offer Price is not agreed between
the Sponsor-Overall Coordinator (for itself and on behalf of the Underwriters) and us on or before 12:00 noon
on Friday, December 19, 2025, the Global Offering will not proceed and will lapse.
(6) None of the websites or any of the information contained on the websites forms part of this prospectus.
(7) The H Share certificates are expected to be issued on Monday, December 22, 2025 but will only become valid
at 8:00 a.m. on the Listing Date provided that the Global Offering has become unconditional in all respects
and the right of termination described in the section headed “Underwriting — Underwriting Arrangements and
Expenses — Hong Kong Public Offering — Grounds for Termination” in this prospectus has not been
exercised. Investors who trade H Shares on the basis of publicly available allocation details prior to the receipt
of H Share certificates or prior to the H Share certificates becoming valid do so entirely at their own risk.
(8) HK eIPO White Form e-Auto Refund payment instructions/refund cheques will be issued in respect of wholly
or partially unsuccessful applications pursuant to the Hong Kong Public Offering and in respect of wholly or
partially successful applications in the event that the final Offer Price is less than the price payable per Offer
Share on application. Part of the applicant’s identification document number, or, if the application is made by
joint applicants, part of the identification document number of the first-named applicant, provided by the
applicant(s) may be printed on the refund cheque, if any. Such data would also be transferred to a third party
for refund purposes. Banks may require verification of an applicant’s identification document number before
encashment of the refund cheque. Inaccurate completion of an applicant’s identification document number may
invalidate or delay encashment of the refund cheque.
EXPECTED TIMETABLE (1)
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(9) Applicants who have applied on the HK eIPO White Form service for 500,000 or more Hong Kong Offer
Shares may collect any H Share certificates in person from our H Share Registrar, Tricor Investor Services
Limited at 17/F, Far East Finance Centre, 16 Harcourt Road, Hong Kong from 9:00 a.m. to 1:00 p.m. on
Tuesday, December 23, 2025 or such other date as notified by us as the date of dispatch/collection of H Share
certificates/e-Auto Refund payment instructions/refund cheque. Applicants being individuals who are eligible
for personal collection may not authorise any other person to collect on their behalf. If you are a corporate
applicant which is eligible for personal collection, 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 evidence of identity acceptable to our H Share Registrar at the time of collection.
Applicants who have applied for Hong Kong Offer Shares through the HKSCC EIPO channel should refer to
the section headed “How to Apply for Hong Kong Offer Shares — D. Despatch/Collection of H Share
Certificates and Refund of Application Monies” in this prospectus for details.
Applicants who have applied through the HK eIPO White Form service and paid their applications monies
through single bank accounts may have refund monies (if any) dispatched to the bank account in the form of
HK eIPO White Form e-Auto Refund payment instructions. Applicants who have applied through the HK
eIPO White Form service and paid their application monies through multiple bank accounts may have refund
monies (if any) dispatched to the address as specified in their application instructions in the form of refund
cheques in favor of the applicant (or, in the case of joint applications, the first-named applicant) by ordinary
post at their own risk.
H Share certificates and/or refund cheques for applicants who have applied for less than 500,000 Hong Kong
Offer Shares and any uncollected H Share certificates 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 sections headed “How to Apply for Hong Kong Offer Shares — D.
Despatch/Collection of H Share Certificates and Refund of Application Monies.”
The above expected timetable is a summary only. Y ou should refer to the sections
headed “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 for applications for the Hong Kong Offer Shares and the expected timetable,
including conditions, effect of bad weather and the dispatch of refund cheques and Share
certificates.
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.
Distribution of this prospectus into any jurisdiction other than Hong Kong may be
restricted by law. Persons who come into possession of this prospectus (including, without
limitation, agents, custodians, nominees and trustees) should inform themselves of, and
observe, any such restrictions. Any failure to comply with such restrictions may constitute a
violation of the securities laws of any such jurisdiction.
EXPECTED TIMETABLE (1)
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IMPORTANT NOTICE TO PROSPECTIVE INVESTORS
This prospectus is issued by our Company 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 prospectus pursuant to the Hong Kong Public Offering. This prospectus
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 circumstances. 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 prospectus in
any jurisdiction other than Hong Kong. The distribution of this prospectus 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 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 prospectus 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 prospectus. We have not
authorized anyone to provide you with information that is different from what is
contained in this prospectus. Any information or representation not contained nor made
in this prospectus must not be relied on by you as having been authorized by our
Company, the Sole Sponsor , the Sponsor-Overall Coordinator , the Overall Coordinators,
the Joint Global Coordinators, the Joint Bookrunners, the Joint Lead Managers, any of
the Underwriters, any of their respective directors, officers, employees, agents or
representatives of any of them or any other parties involved in the Global Offering.
Information contained in our website, located at www.hanxbio.com does not form part
of this prospectus.
EXPECTED TIMETABLE ........................................... i v
CONTENTS ...................................................... viii
SUMMARY ....................................................... 1
DEFINITIONS .................................................... 2 9
GLOSSARY OF TECHNICAL TERMS ................................. 4 5
FORW ARD-LOOKING STATEMENTS ................................. 6 0
RISK FACTORS ................................................... 6 2
CONTENTS
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W AIVERS FROM STRICT COMPLIANCE WITH THE LISTING RULES
AND EXEMPTION FROM COMPLIANCE WITH THE COMPANIES
(WINDING UP AND MISCELLANEOUS PROVISIONS) ORDINANCE ..... 1 0 7
INFORMATION ABOUT THIS PROSPECTUS AND
THE GLOBAL OFFERING ........................................ 1 1 6
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN
THE GLOBAL OFFERING ........................................ 1 2 1
CORPORATE INFORMATION ....................................... 1 3 0
INDUSTRY OVERVIEW ............................................ 1 3 2
REGULATORY OVERVIEW ......................................... 1 9 2
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE ............ 2 3 0
BUSINESS ........................................................ 2 6 6
CONNECTED TRANSACTIONS ...................................... 4 0 4
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT ............. 4 1 5
RELATIONSHIP WITH OUR CONTROLLING SHAREHOLDERS .......... 4 3 5
SUBSTANTIAL SHAREHOLDERS .................................... 4 4 5
CORNERSTONE INVESTORS ........................................ 4 4 9
SHARE CAPITAL .................................................. 4 5 9
FINANCIAL INFORMATION ........................................ 4 6 3
FUTURE PLANS AND USE OF PROCEEDS ............................ 4 9 7
UNDERWRITING ................................................. 5 0 1
STRUCTURE OF THE GLOBAL OFFERING ........................... 5 1 5
HOW TO APPLY FOR HONG KONG OFFER SHARES ................... 5 2 7
APPENDIX I – ACCOUNTANTS’ REPORT ...................... I - 1
CONTENTS
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APPENDIX II – UNAUDITED PRO FORMA FINANCIAL
INFORMATION ............................. II-1
APPENDIX III – TAXATION AND FOREIGN EXCHANGE .......... III-1
APPENDIX IV – SUMMARY OF PRINCIPAL PRC LEGAL AND
REGULATORY PROVISIONS .................. I V - 1
APPENDIX V – SUMMARY OF THE ARTICLES OF ASSOCIATION .V - 1
APPENDIX VI – STATUTORY AND GENERAL INFORMATION ..... VI-1
APPENDIX VII – DOCUMENTS DELIVERED TO THE
REGISTRAR OF COMPANIES IN HONG KONG
AND DOCUMENTS ON DISPLAY .............. VII-1
CONTENTS
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This summary aims to give you an overview of the information contained in this
prospectus. As this is a summary, it does not contain all the information that may be
important to you. You should read this prospectus in its entirety before you decide to
invest in the Offer Shares. There are risks associated with any investment. Some of the
particular risks in investing in the Offer Shares are set out in “Risk Factors” of this
prospectus. You should read that section carefully before you decide to invest in the Offer
Shares. In particular, we are a biotech 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 Rules 8.05(1), (2) or (3) of the Listing Rules.
Our Core Product, HX009, is under the clinical stage and we will continue to incur a
substantial amount of research and development expenses on our Core Product. There are
unique challenges, risks and uncertainties associated with investing in companies such as
ours. Your investment decision should be made in light of these considerations.
OVERVIEW
We are a biotech company, with in-house expertise and experience in structural biology,
translational medicine and clinical development. Since 2016, we have developed a product
pipeline comprising of one Core Product and nine other pipeline candidates, which are (i) three
clinical stage drug candidates focused on oncology, including our Core Product HX009 and
Key Products HX301 and HX044; and (ii) seven preclinical stage drug candidates including
antibody drug conjugate, bispecific antibody and monoclonal antibody for both autoimmune
and oncology market. Prior to the Track Record Period, we also developed HX008, which was
transferred to a biopharmaceutical company focusing on oncology therapeutics.
Our Core Product HX009 is a bifunctional anti-PD-1 (an immune checkpoint receptor)
antibody SIRP /H9251fusion protein developed in-house. During the Track Record Period and up to
the Latest Practicable Date, we have completed the Phase I clinical trial of HX009 in Australia
and China. We are currently conducting three clinical programs for HX009 in China, namely,
(i) the HX009-I-01 China Study (Phase Ib) for treatment of advanced melanoma, (ii) the
HX009-II-02 China Study (Phase I/II) for treatment of relapsed/refractory Epstein-Barr virus
positive non-Hodgkin lymphoma, and (iii) the HX009-II-05 China Study (Phase IIa) for
treatment of advanced biliary tract cancer. We also obtained the NMPA approval in February
2025 for a combination study of HX009 with trastuzumab in patients with advanced
triple-negative breast cancer, and we expect the first patient enrollment for this combination
study to be in 2026.
SUMMARY
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As of the Latest Practicable Date, we also have two Key Products, namely HX301 and
HX044, which are in the clinical stage, focusing on the treatment of cancer. HX301 is a
multi-targeted kinase inhibitor targeting critical pathways such as CSF1R, ARK5, FLT-3, and
CDK4/6. We have completed the Phase I clinical study of HX301 under its NMPA approval and
are currently conducting the Phase II clinical study of HX301 in combination with
temozolomide for treatment of glioblastoma in China. HX044 is a novel bifunctional
anti-CTLA-4 (an immune checkpoint receptor) antibody SIRP /H9251fusion protein, which was
created to enhance the CTLA-4-targeting efficacy. We are currently conducting the Phase I/IIa
clinical studies of HX044 for treatment of advanced solid tumor malignancies in Australia and
China.
Through the discovery, development and commercialization of precision therapies in
cancers and autoimmune diseases, we are committed to developing next-generation
immunotherapeutics ultimately to help patients with unmet medical needs in global market.
THERE IS NO ASSURANCE THAT WE WILL ULTIMATELY BE ABLE TO DEVELOP
AND MARKET OUR CORE PRODUCT OR ANY OF OUR PIPELINE PRODUCTS
SUCCESSFULLY.
SUMMARY
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As of the Latest Practicable Date, we have developed a pipeline of 10 drug candidates, including our Core Product HX009 and two Key
Products HX044 and HX301, and among which, eight drug candidates focusing on oncology and two drug candidates focusing on autoimmune
diseases. As of the Latest Practicable Date, our Core Product and Key Products are under clinical trials in China and Australia, separately. The
following chart summarizes the development status of our pipeline products as of the Latest Practicable Date.
Class of DrugsMoAsProduct Current Indication/
Therapeutic Area  Commercial RightsTreatment Line Preclinical Phase Ia/I Phase III/
Registrational PartnershipUpcoming
MilestonePhase Ib/II NDA/
BLA
small moleculeCSF1R/ARK5/
CDK4/6/FLT-3
Glioblastoma
(combination therapy) Greater China
Clinical Pre-Clinical
Global
Complete Phase Ib clinical
study by the second half of 2026
Complete Phase Ib
clinical study by end of 2025
Complete Phase IIa
clinical study by end of 2028
Complete Phase IIa
clinical study by the third
quarter of 2027
Launch Phase IIa
clinical study in 2026
N/A
N/A
2L+
2L+
1L/2L+
1L
R/R EBV+ NHL
(monotherapy)
Advanced Melanoma
(monotherapy)
Advanced Biliary
Tract Cancer
(combination therapy)
HX009(1)
HX301(2)
Complete preclinical trial
and file IND application
by end of 2026
Advanced solid tumor
malignancies (monotherapy
and combination therapy)
Global
Complete dose escalation
clinical study by the fourth
quarter of 2026
2L+
BsAb GlobalInflammation/autoimmuneHX035 File IND application
by the first quarter of 2026OX40 epitopes N/A
Inflammation/autoimmune GlobalBsAbHX038
Complete preclinical trial by end
of 2026 and file IND application
by the first quarter of 2027
OX40/
Undisclosed target N/A
Global mAb-ADCUndisclosed
target Selected T-L/L+ solid tumorsHX111 To receive IND approval by
the first quarter of 2026N/A
HX044(3)
N/A(5) mAbNKG2A PD-1-resistant solid tumors/
viral infection GlobalHX017 N/A
BsAbPD1/VEGF Solid tumors GlobalHX016-9 N/A
BsAbPD-L1/VEGF Solid tumors GlobalHX016-7 N/A
HX129 Selected T-L/L GlobalmAb-ADCTRBV12 N/A N/A(5)
Co-development
PD-1/SIRPα bifunctional
antibody
fusion protein
bifunctional
antibody
fusion protein
 Core Product Key Product
2L+
Advanced Triple-Negative
Breast Cancer
(combination therapy)
Competent Authority
NMPA
NMPA
NMPA
NMPA
NMPA
TGA/NMPA
N/A
N/A
N/A
N/A
N/A
N/A
N/A
CTLA-4/SIRPα
SUMMARY
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--- page 15 ---
Notes:
(1) We obtained from NMPA the clinical trial approval notification (i) for HX009 monotherapy in patients with malignancies in October 2019, (ii) for H X009 in combination with
a pivotal stage drug in patients with advanced solid tumor (including BTC and advanced melanoma) in September 2024, and (iii) for HX009 in combination with trastuzumab
in patients with advanced triple-negative breast cancer in February 2025. As of the Latest Practicable Date, we have completed Phase Ia of the HX009-I -01 China Study, which
is a standalone and conventional Phase I clinical study. We are currently conducting Phase Ib of the HX009-I-01 China Study for the treatment of advanc ed melanoma, the
HX009-II-02 China Study for the treatment of R/R EBV + NHL, and the HX009-II-05 China Study for the treatment of advanced biliary tract cancer, which is a combination
study with a focal adhesion kinase inhibitor (aka. FAKi) drug developed by InxMed Biotech Co., Ltd. (Shanghai)* (Ҧ(ɪऎ)ʮ̡).As of the Latest Practicable
Date, this FAKi drug was in its pivotal trial stage (Stage III), and HX009 for this study will only be used together with this FAKi drug once it receives th e market authorization
approval. The dotted line represents the exempted stages for these two combination studies of HX009, which was granted as leveraging study results fr om other clinical trial
programs of HX009 (including HX009-I-01 Australia Study and Phase Ia of the HX009-I-01 China Study) and communications with the Competent Authoriti es in this regard.
(2) We obtained from NMPA the clinical trial approval notification for HX301 monotherapy in patients with advanced malignancies in January 2020 and f or HX301 in combination
with temozolomide in patients with glioblastoma in August 2024, respectively. As of the Latest Practicable Date, we have completed Phase I clinical s tudy of the HX301-I-01
China Study. We are currently conducting the Phase IIa clinical study of HX301 in combination with temozolomide (i.e., HX301-II-01 China Study), and have enrolled seven
patients as of the Latest Practicable Date. The dotted line represents the exempted stages for the combination study of HX301, which was granted as lev eraging study results
from other clinical trial programs of HX301 (including HX301-I-01 China Study and Onconova 19-01 phase 1 study conducted in the U.S.) and communicati ons with the
Competent Authorities in this regard.
(3) Pursuant to the relevant laws and regulations in Australia, we submitted our Human Research Ethics Committee (HREC) application for HX044, and ob tained the HREC approval
dated September 10, 2024 for conducting a Phase I/IIa clinical study to evaluate the safety and tolerability of HX044 in the treatment of patients with advanced solid tumor
malignancies (i.e., the HX044-I-01 Australia Study). In addition, we have obtained from NMPA the clinical trial approval notification for HX044 mon otherapy and a combination
study of HX044 with pucotenlimab in patients with advanced solid tumor malignancies in January and September 2025, respectively (i.e., the HX044-I- 01 China Study). The
advanced solid tumor targeted by our product refers to relapsed/refractory solid tumor. As of the Latest Practicable Date, we have enrolled 23 patien ts for the monotherapy part
(with eight patients in Australia and 15 patients in China) and two patients for the combination therapy part, respectively, for the HX044-I-01 studi es.
(4) Prior to the Track Record Period, we co-developed HX008 with Zhongshan Kangfang, which is, a mAb targeting PD-1 with a proven long half-life. Short ly after we obtained
the clinical study approval in August 2017 and through a series of equity transfer agreements entered in between 2017 and 2019, HX008 was transferred t o Lepu for a one-off
cash payment of RMB350.0 million and annual royalty fee of 4.375% of the annual net sales revenue of HX008. In July and September 2022, the NMPA granted c onditional
marketing approval for HX008 for the treatment of MSI-H/dMMR solid tumors and inoperable or metastatic melanoma, respectively. As of the Latest Prac ticable Date, we have
received full payment of the one-off cash payment of RMB350.0 million as the milestone payment, and approximately RMB0.7 million, RMB4.4 million and RMB13.1 million
as the HX008 annual royalty fee for 2022, 2023 and 2024, respectively. For details, please refer to “Business — Collaboration Agreements — HX008 Equit y Transfer
Agreements” in this prospectus.
(5) The pipeline candidates were developed as preclinical candidate compounds. As of the Latest Practicable Date, we have completed the preclinical studies and achieved promising
results for the respective pipeline candidates. We plan to proactively seek collaboration with industry-leading business partners to further deve lop these pipeline candidates.
SUMMARY
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--- page 16 ---
Our core business model involves developing a strong immuno-oncology program. We
developed HX008, a monoclonal antibody targeting PD-1 with a proven long half-life, which
was transferred prior to the Track Record Period and later commercialized in 2022. During the
Track Record Period, we primarily pivoted towards innovations by creating bi- or multi-
functional molecules into our immune-oncology pipeline, including “PD-1 plus ” molecule
HX009, being our Core Product, and HX016-9; “CTLA-4 plus ” molecule HX044, being one of
our Key Products; and the “PD-L1 plus ” molecule HX016-7. We created these new antibody
modalities by utilizing our proprietary V ersatiBody Platform, an antibody engineering platform
that can be flexibly adapted to create candidate antibody drugs that meet different target
biology requirements for enhancement of efficacy and reduction of toxicity.
OUR PRODUCT PIPELINE
Except for HX301, which was licensed in from Onconova Therapeutics, Inc., we
developed all of our pipeline candidates in-house. We constructed our pipeline to harness both
innate and adaptive arms of immunity to unleash their synergistic potential. Our pipeline is
designed to address the limitations of current checkpoint inhibitor immunotherapies, such as
limited response due to “cold tumors” with immune-suppressive tumor microenvironment and
to other unmet medical needs, thereby bringing clinical benefits to patients with a wide range
of cancer as well as other diseases indications. As of the Latest Practicable Date, we had built
up a pipeline composed of 10 drug candidates, with three pipeline products in clinical stage.
Except for HX301 which we own development and commercialization rights in Greater China
and certain royalties for sales outside of Greater China, we own worldwide IP , development
and commercial rights to all our pipeline candidates. It allows us to address critical medical
needs in the global market. For details, please refer to “Business – Overview” in this
prospectus. Currently, we plan to prioritize the clinical trials for our pipeline candidates in
China, and have no plan for any pivotal-trial stage development, manufacturing and
commercialization of our product candidates in Australia and the U.S. due to significant
funding needs for pivotal-stage clinical trials and commercialization. We’ll advance to these
markets when clear strategic synergies arise, and may consider opportunities if collaborative
prospects emerge.
Core Product – HX009
Our Core Product, HX009, is an advancement in immuno-oncology as an innovative
bifunctional anti-PD-1 antibody SIRP /H9251fusion protein, aiming at enhancing PD-1 function and
creating a novel “PD-1 plus ” molecule. HX009 is a cancer immunotherapy designed and
developed by us to treat various malignancies. HX009 enhances T cell activations via
co-targeting of CD8
+ Teff by blocking PD-1 and cis engagement with CD47 on Teff within the
tumor micro-environment via anti-PD-1 antibody and SIRP /H9251extracellular domain (one of the
natural ligand proteins of CD47) on HX009, as well as improves macrophage phagocytosis and
dendritic cell-mediated tumor antigen presentations by blocking the interaction between SIRP /H9251
on tumor-infiltrated macrophage or dendritic cells, and CD47 on tumor cells. In addition to its
anti-tumor activity, HX009 also mitigates anemia and thrombocytopenia risk by minimizing
off-tumor targeting to CD47 on human red blood cells and platelets via the reduced binding
SUMMARY
–5–


--- page 17 ---
affinity as well as tumor-targeting caused by high affinity PD-1-driving binding.
Thrombocytopenia means abnormally low level of platelets in blood. Platelets are tiny blood
cells that form clots to stop bleeding. When thrombocytopenia occurs, bleeding may be
difficult to stop or may not stop at all. Therefore, we believe that HX009 signifies a new realm
of immune checkpoint inhibitors.
We initiated first-in-human clinical trial for HX009 in Australia to evaluate the safety,
tolerability and initial efficacy of HX009 in patients with advanced malignancies, which was
completed in October 2022, and HX009 was well tolerated in all 21 treated subjects as
concluded by the principal investigator. In addition, in October 2019, we obtained the clinical
trial approval notification from NMPA, which allows us to carry out clinical trials in China of
HX009 for treatment of advanced malignancies, including advanced melanoma and R/R EBV
+
NHL. Furthermore, in April 2023, we filed an IND application with FDA for our Phase Ib/II
clinical study of HX009 in the U.S. for the treatment of DLBCL, and obtained the FDA Study
May Proceed approval in May 2023. As of the Latest Practicable Date, we have completed
Phase Ia of the HX009-I-01 China Study, which is a standalone and conventional phase I study
to evaluate the safety and tolerability of HX009 for the treatment of advanced solid tumors and
to preliminarily measure its anti-tumor efficacy.
We conducted the clinical studies of HX009 in accordance with the respective protocols
and approvals. In September 2024, our PRC Legal Adviser, together with the Sole Sponsor and
its legal advisers, conducted a face-to-face interview with a reviewer of the Office of Clinical
Trial Management Department from CDE of NMPA in Beijing, and during which, it was
confirmed that, among others, we have completed a conventional phase I clinical study and the
HX009 NMPA Umbrella Approval has allowed the Company to conduct clinical studies under
HX009-I-01 China Study before phase III without additional regulatory approval from NMPA.
For details, please refer to “Business — Clinical-stage Candidates — Core Product — HX009
— Communications with Regulatory Authorities — NMPA” in this prospectus.
In September 2024, NMPA granted us the Phase IIa clinical study approval for HX009 in
combination with a pivotal trial stage (Stage III) FAKi drug for the treatment of advanced
malignant BTC and melanoma. The drug used in this combination study is a focal adhesion
kinase inhibitor (aka. FAKi) drug developed by InxMed Biotech Co., Ltd. (Shanghai)* ( Ꮠ˰
Ҧ(ɪऎ)ʮ̡). As of the Latest Practicable Date, this FAKi drug was in its pivotal
trial stage (Stage III), and HX009 for this study will only be used together with this FAKi drug
once it receives the market authorization approval. We also obtained the NMPA approval in
February 2025 for a combination study of HX009 with trastuzumab in patients with advanced
triple-negative breast cancer, and we expect the first patient enrollment for this combination
study to be in 2026.
We are currently conducting three clinical programs for HX009 in China, namely, (i) the
HX009-I-01 China Study (Phase Ib) for treatment of advanced melanoma, (ii) the HX009-II-02
China Study (Phase I/II) for treatment of R/R EBV
+ NHL, and (iii) the HX009-II-05 China
SUMMARY
–6–


--- page 18 ---
Study (Phase IIa) for treatment of advanced biliary tract cancer. For details about the clinical
studies about our Core Product, please refer to “Business — Clinical Stage Candidates — Core
Product HX009” in this prospectus.
Currently, we do not plan to conduct head-to-head studies for our HX009 as head-to-head
trial usually refers to a comparison between the control group (existing standard treatment) and
the experimental group, where the drugs administrated shall be in the same category (for
example, mAb, BsAb, etc.) for the purpose of efficacy comparison, and whether a head-to-head
trial is required by the competent authority generally depends on the standard treatment for the
targeted indication. For the targeted indications and treatment line of HX009, there is a lack
of standard treatment at this stage, therefore, we not expect head-to-head studies will be
required by the competent authorities for its current targeted indications.
Key Product – HX301
Our Key Product, HX301, represents a significant advancement in cancer therapy as a
multi-targeted kinase inhibitor with a unique kinase inhibition profile. Its mechanism of action
lies in its role as an investigational multi-kinase inhibitor developed to combat various cancers
by targeting critical pathways such as CSF1R, ARK5, FLT-3 and CDK4/6. CSF1R plays a
pivotal role in the growth, survival, and polarization of myeloid lineage cells such as
macrophages and it is often overexpressed in certain cancer cells such as acute myeloid
leukemia, and tumor-associated macrophages including glioma-associated macrophages or
microglial cells that are potentially correlating with poorer cancer prognosis. HX301 holds
promise as a candidate cancer treatment by directly targeting cancer cells, such as acute
myeloid leukemia, or indirectly impacting tumor-associated macrophages. Besides, as the
ability to mobilise across the blood brain barrier is studied and evidenced mainly through
preclinical and/or clinical results, and it was evidenced in preclinical studies that HX301 is
capable of blood-brain barrier penetration with a brain: plasma exposure ratio of approximately
70%, suggesting it may also be developed as a promising treatment of glioblastoma, an
aggressive malignancy with huge unmet medical need.
Pre-clinical models and Phase I safety and efficacy data demonstrate promising results of
HX301, underscoring its capacity as a therapeutic option for various advanced solid tumors. In
January 2020, NMPA issued the clinical trial approval notification for HX301, which allows us
to conduct clinical trials of HX301 for treatment of advanced malignancies in China. In July
2024, we completed the Phase I clinical study of HX301 under the aforesaid NMPA approval,
which is a phase I, open-label, multi-center study evaluating the safety, tolerability, and initial
efficacy of HX301 in patients with advanced solid tumor. The efficacy results suggest that
some patients achieved stable disease at doses of 80 mg or higher, and the duration of stable
disease may be longer with higher doses, which provides clinical benefit support for
subsequent clinical development, especially for the exploration of combination therapies.
SUMMARY
–7–


--- page 19 ---
We obtained the clinical trial approval notification from NMPA for HX301 in August
2024, which allows us to conduct clinical trials of HX301 in combination with temozolomide
for the treatment of glioblastoma. We have enrolled first patient for this combination study
(i.e., the HX301-II-01 China Study) in January 2025, and the HX301-II-01 China Study is
currently ongoing as of the Latest Practicable Date.
Key Product – HX044
HX044 is a Key Product developed by our Group currently at clinical stage. It is an
innovative clinical-stage drug for treatment of various types of advanced solid tumor
malignancies, particularly PD-1-resistant solid tumors, including but not limited to NSCLC,
melanoma, renal cell carcinoma, and gastrointestinal cancer. HX044 is a bifunctional
anti-CTLA-4 antibody SIRP /H9251fusion protein, with intention to create a “CTLA-4 plus ”
molecule with increased therapeutic window.
HX044 was created in-house, and we have global rights for development and
commercialization. It was engineered to significantly reduce affinity for both single targeting
of CTLA-4 and CD47, so that it can minimize irAEs and hematological toxicity that resulted
from both single bindings in peripheral blood but much higher affinity to tumor cells. On the
other hand, as demonstrated in the preclinical models, HX044 efficiently binds to Treg where
co-high-expression of both targets occur, resulting in depletion of Treg as well as remodeling
of tumor micro-environment significantly in favor of anti-tumor immunity as compared with
anti-CTLA-4 mAbs. Therefore, HX044 is expected to broaden therapeutic window.
Pursuant to the relevant laws and regulations in Australia, we obtained the HREC
approval and relevant site ethics committee approval in September 2024. We launched the
Phase I/IIa clinical study to evaluate the safety and tolerability of HX044 for the treatment of
advanced solid tumor malignancies in Australia, with first patient enrolled in December 2024.
As of the Latest Practicable Date, we have enrolled eight patients for the HX044-I-01 Australia
Study. In addition, we have obtained from NMPA the clinical trial approval notification for
HX044 monotherapy and a combination study of HX044 with pucotenlimab in patients with
advanced solid tumor malignancies in January and September 2025, respectively (i.e., the
HX044-I-01 China Study). The advanced solid tumor targeted by our product refers to
relapsed/refractory solid tumor. As of the Latest Practicable Date, we have enrolled 15 patients
for the monotherapy part and two patients for the combination therapy part, respectively, for
the HX044-I-01 China Study. According to the F&S Report, HX044 is the only CTLA-4/SIRP /H9251
bispecific antibody/bifunctional fusion protein under clinical study globally as of the Latest
Practicable Date.
Other Product Pipeline
Our other product pipeline comprises of seven preclinical stage drug candidates including
antibody drug conjugate (HX111 and HX129), bispecific antibody (HX035, HX038, HX016-9
and HX016-7) and monoclonal antibody (HX017) for both autoimmune and oncology market.
We have completed the preclinical studies and achieved promising results for the respective
SUMMARY
–8–


--- page 20 ---
pipeline candidates. In October 2025, we submitted IND application of a Phase I/IIa clinical
study of our leading preclinical candidate compound HX111 to NMPA (i.e., the HX001-I-01
China Study), and we expect to obtain the clinical study approval in the first quarter of 2026.
As of the Latest Practicable Date, HX129 and HX017 were developed as preclinical
candidate compounds. While we do not expect to prioritize the clinical studies of HX129 and
HX017 by ourselves, we plan to proactively seek collaboration with industry-leading business
partners to further develop these pipeline candidates.
COMMERCIALIZED PRODUCT
HX008 is a humanized antagonist mAb against human PD-1 by using human IgG4
isotype, which can inhibit the PD-1 signal to restore the capability of the immune cells to kill
cancer cells through blocking PD-1 binding to their ligands PD-L1 and PD-L2. It innovatively
employs antibody engineering techniques to introduce mutations into Fc portion, thereby
significantly improving its half-life and leads to strong clinical anti-tumor activity and a
favorable safety and efficacy profile.
We co-developed HX008 with Zhongshan Kangfang prior to the Track Record Period.
Shortly after we obtained the clinical study approval in August 2017 and through a series of
equity transfer agreements entered in between 2017 and 2019, HX008 was transferred to Lepu
for a one-off cash payment of RMB350.0 million and annual royalty fee of 4.375% of the
annual net sales revenue of HX008. In July and September 2022, the NMPA granted
conditional marketing approval for HX008 for the treatment of MSI-H/dMMR solid tumors and
inoperable or metastatic melanoma, respectively. As of the Latest Practicable Date, we have
received full payment of the one-off cash payment of RMB350.0 million. Benefitted from the
successful commercialization of HX008, we received payment of approximately RMB0.7
million, RMB4.4 million and RMB13.1 million as the HX008 annual royalty fee as of the
Latest Practicable Date in accordance with its net sales revenues recorded in 2022, 2023 and
2024, respectively. For details, please refer to “Business — Collaboration Agreements —
HX008 Equity Transfer Agreements” in this prospectus.
ADDRESSABLE MARKET
Our Core Product, HX009, is a bispecific antibody fusion protein targeting both CD47
and PD-1. According to the F&S Report, as of the Latest Practicable Date, HX009 stands out
with the leading position in respect of its clinical trial progress in the world among comparable
CD47 targeted bispecific antibody/bifunctional fusion protein products.
Our Core Product, HX009, mainly targets for the second line treatment of the respective
indications. As of the Latest Practicable Date, we were conducting clinical studies of HX009
in patients with relapsed/refractory EBV
+ NHL, advanced melanoma and advanced BTC. In
addition, we expect to commence the clinical trials of HX009 for treatment of advanced TNBC
in 2026.
SUMMARY
–9–


--- page 21 ---
According to the F&S Report, from 2019 to 2024, the total EBV + NHL market in China
has increased from RMB0.3 billion to RMB0.5 billion, representing a CAGR of 10.1%, and it
is forecasted to reach RMB1.6 billion and RMB2.8 billion by 2030 and 2035 respectively.
According to the F&S Report, for the second line EBV
+ NHL that targeted by our HX009, the
number of patients in 2024 was approximately 4.4 thousand in China and 33.6 thousand
globally. Currently, there are seven innovative monotherapy pipelines targeting second line and
above EBV
+ NHL.
According to the F&S Report, from 2019 to 2024, the global melanoma market has
increased from US$12.6 billion to US$18.4 billion, representing a CAGR of 7.9%, and it is
forecasted to reach US$23.6 billion and US$27.3 billion by 2030 and 2035 respectively. From
2019 to 2024, the total melanoma market in China has increased from US$0.2 billion to US$0.3
billion, representing a CAGR of 6.2%, and it is forecasted to reach US$0.4 billion in 2035.
According to the F&S Report, for the first and second line melanoma that targeted by our
HX009, the number of patients in 2024 was approximately 4.9 thousand in China and 24.3
thousand globally. Currently, there are over 50 innovative monotherapy pipelines targeting
first-line and second-line or above melanoma treatment, with four in phase I/II, eight in phase
II, and four in phase III.
According to the F&S Report, from 2019 to 2024, China’s BTC drug market size
increased from RMB1.5 million to RMB3.4 billion, representing a CAGR of 17.7%, and it is
forecasted to RMB9.9 billion and RMB17.2 billion in 2030 and 2035 respectively. According
to the F&S Report, for the second line BTC targeted by our HX009, the number of patients in
2024 was approximately 84.9 thousand in China and 254.6 thousand globally. Currently, there
are over 85 pipeline drugs for the treatment of second-line and above BTC in clinical trials.
Among them, 16 are combination pipelines. Specifically, four are in phase I, 10 are in phase
I/II, and two are in phase II.
According to the F&S Report, from 2019 to 2024, China’s TNBC drug market size
increased from RMB3.5 billion to RMB3.8 billion in 2024, representing a CAGR of 1.9%, and
it is forecasted to RMB5.0 billion and RMB5.9 billion in 2030 and 2035 respectively.
According to the F&S Report, for the second line TNBC that targeted by our HX009, the
number of patients in 2024 was approximately 33.5 thousand in China and 218.9 thousand
globally. Currently, there are over 90 pipeline drugs for the treatment of second-line and above
TNBC in clinical trials. Among them, 26 are combination pipelines. Specifically, eight are in
phase I, 12 are in phase I/II, four are in phase II, and one is in phase III.
Our Key Product, HX301, is a multi-targeted kinase inhibitor targeting pathways such as
CSF1R, ARK5, FLT-3 and CDK4/6. As of the Latest Practicable Date, we have completed the
Phase I study of HX301 in patients with advanced solid tumor. In addition, we have obtained
the HX301 NMPA GBM Combination Approval on August 19, 2024 for the combination
treatment of HX301 and temozolomide in patients with glioblastoma. We have enrolled first
patient for this combination study (i.e., the HX301-II-01 China Study) in January 2025, and the
HX301-II-01 China Study is currently ongoing as of the Latest Practicable Date. According to
the F&S Report, the market of glioblastoma in China reached RMB1.2 billion in 2024 and
would enlarge to RMB3.2 billion and RMB5.4 billion by 2030 and 2035 with the CAGR of
17.9% and 10.7% respectively. Currently, there are three small molecule inhibitor for first line
combination treatment of glioblastoma in clinical stage in China.
SUMMARY
–1 0–


--- page 22 ---
COMPETITIVE LANDSCAPE
Currently, approximately 90% of the approved immune-oncology therapies are
monoclonal antibodies, and majority of other types (e.g., bispecific antibody, ADC, fusion
protein) of therapies are under the development. There are more than 40 PD-1 targeted
bispecific antibody drugs with more than 15 targets are under the development, including
CD47, CTLA-4, LAG3, etc.. Also, more than 50 PD-L1 targeted bispecific antibody drugs with
more than 15 targets are under the development, including CD47, CTLA-4, TGF /H9252, etc.. Most
of them are still concentrated in Phase I and Phase II clinical study stage. As of the Latest
Practicable Date, there were eight bispecific antibody drugs targeting both PD-1/PD-L1 and
CD47 pathways under clinical development in China and globally, and HX009 developed by
the Company is the only bispecific antibody fusion protein targeting both PD-1 and CD47
concurrently in both global and China market.
Currently, there are 13 CTLA-4 targeted bispecific antibody drugs under the clinical
development globally. HX044 is the only CTLA-4/CD47 bispecific antibody/bifunctional
fusion protein under the clinical development globally.
Global (including China) Approved PD-1/PD-L1 Bispecific Antibody Drugs
Currently, there are two approved PD-1 bispecific antibody drug, which are cadonilimab
and ivonescimab.
Cadonilimab
Kaitanni® Akeso
Cervical Cancer 2L Monotherapy 2022/06/28
China B
approximately
RMB7,500
GC/GEJC 1L
Combination with
fluoropyrimidine and
platinum-based
chemotherapy agents
This product is administered
via intravenous infusion. The
recommended dose is 6
mg/kg, given every 2 weeks
until disease progression or
intolerable toxicity occurs.
This product is administered
by intravenous infusion. The
recommended dose is 10
mg/kg, given every 3 weeks
until disease progression or
intolerable toxicity occurs.
This product is administered
via intravenous infusion. The
recommended dose is 20
mg/kg, given every 3 weeks
until disease progression or
intolerable toxicity occurs.
EGFR-mutated locally
advanced or metastatic
NSCLC patient who
have progressed after
EGFR-TKI treatment
locally advanced or
metastatic NSCLC
with PD-L1 TPS≥1%,
EGFR mutation-
negative, and
ALK-negative
Combination with
Pemetrexed and
carboplatin
Ivonescimab
Yidafang®
2024/09/26 approximately
RMB11,000
PD-1,
VEGF Akeso
2L 2024/05/21
China
B approximately
RMB10,000
1L Monotherapy 2025/04/22 / approximately
RMB32,000
Target Company Indications Dosage Country Line of
Treatment
Combination
Therapy
Approval
Date
Price per
Treatment
Cycle
Medical
Insurance
Drug
Name
PD-1,
CTLA-4
Source: NMP A, FDA, Company Website, Literature Review, Frost & Sullivan Analysis
Notes:
(1) Industry information is as of December 8, 2025.
(2) GC refers to Gastric Cancer; GEJC refers to Gastroesophageal Junction Cancer.
(3) In 2023, the annual sales of Kaitanni were RMB1,357.8 million. However, in 2024, Akeso did not disclose the
annual sales of Kaitanni and Yidafang.
SUMMARY
–1 1–


--- page 23 ---
Global (including China) Approved CTLA-4 Bispecific Antibody Drugs
Currently, Kaitanni is the only approved CTLA-4 bispecific antibody drug.
Target Drug
Name Company Indications Line of
Treatment
Combination
Therapy
Approval
Date Dosage Country
Medical
Insurance
Price per
Treatment
Cycle
PD-1,
CTLA-4
Cadonilimab
Kaitanni® Akeso
Cervical Cancer
2L Monotherapy 2022/06/28 This product is
administered via
intravenous infusion. The
recommended dose is 6
mg/kg, given every 2 weeks
until disease progression or
intolerable toxicity occurs.
China B
approximately
RMB7,500
1L
Combined with
platinum based
chemotherapy and
Bevacizumab, or
combined with or
without
Bevacizumab
2025/05/27
GC/GEJC 1L
Combination with
fluoropyrimidine
and platinum-
based
chemotherapy
agents
2024/09/26
This product is
administered by
intravenous infusion. The
recommended dose is 10
mg/kg, given every 3 weeks
until disease progression or
intolerable toxicity occurs.
approximately
11,000
Source: NMP A, FDA, Company Website, Literature Review, Frost & Sullivan Analysis
Notes:
(1) Industry information is as of December 8, 2025.
(2) GC refers to Gastric Cancer; GEJC refers to Gastroesophageal Junction Cancer.
Global (including China) Development of CD47 Bispecific Antibody Drugs
CD47 is a cell surface protein that acts as a key regulator of the tumour microenvironment
and represents a potential target for cancer therapy. It is found to be overexpressed in different
types of tumors and act as a “don’t eat me” signal, which contributes to immune evasion.
However, there are several obstacles and risks associated with targeting CD47. First, since
CD47 is also expressed on healthy cells, CD47-targeted drugs may cause anemia and other
hematological toxicities due to the phagocytosis of healthy red blood cells upon CD47
inhibition. Another challenge is that CD47 is not the only immune checkpoint molecule; others,
such as PD-1, also play a role in tumour immune evasion. Targeting CD47 alone may not be
sufficient for a robust anti-tumour response. Therefore, drugs with multiple targets, such as
bispecific antibodies, may be needed.
Our Core Product, HX009, is a bispecific antibody fusion protein targeting both CD47
and PD-1. CD47 expressed on tumor cells protects them from phagocytosis through interaction
with SIRP /H9251on macrophages, while PD-1 dampens T cell-mediated tumor killing. For HX009,
anti-CD47/SIRP /H9251extracellular domain (one of the natural ligand proteins of CD47) and
anti-PD-1 exhibit synergistic anti-tumor efficacy via CD8+ T cell activation and macrophage-
mediated immune response. For details, please refer to “Business — Clinical-stage Candidates
— Core Product — HX009 — Preclinical Studies of HX009” in this prospectus.
Particularly, as of the Latest Practicable Date, there are no approved CD47 targeting
bispecific antibody drugs available. According to the F&S Report, as of the Latest Practicable
Date, HX009 stands out with the leading position in respect of its clinical trial progress in the
world among comparable CD47 targeted bispecific antibody/bifunctional fusion protein
products. For details, please refer to “Industry Overview” in this prospectus.
SUMMARY
–1 2–


--- page 24 ---
OUR PLATFORMS
Our V ersatiBody Platform
Our V ersatiBody Platform is an innovative antibody technology platform that serves as
the foundation for a new realm of therapeutic antibodies. This versatile platform is designed
to create bi- or multi-specific antibodies, antibody-fusion proteins and/or antibody-drug-
conjugates that offer enhanced therapeutic capability, with a focus on tailoring antibody-based
agent to meet specific target biology requirements. The platform’s innovative design allows for
the development of antibody-based therapeutics, on one hand being manufacturable with
desired stability as pharmaceutical products required, while on the other hand, being with
desired pharmacology properties including longer half-life, reduced immunogenicity, desired
pharmacodynamic properties, which can translate to better efficacy, safety, and convenience
for patients. The platform’s flexible design and workflow allow for the efficient creation of
antibody-based molecules with these features and high successful rate.
In contrast to “one-size-fits-all” approach, the key advantage of our V ersatiBody Platform
is its adaptability that may enable the development of antibodies against a wide range of targets
and opening up possibilities for treating various diseases across different therapeutic areas.
This versatility is particularly valuable in the rapidly evolving landscape of
biopharmaceuticals, where the ability to rapidly develop new treatments for emerging health
challenges is crucial. For details, please refer to “Business – Research and Development
(“R&D”) – Our V ersatiBody Platform” in this prospectus.
Our autoRx40 Platform
Our autoRx40 Platform is an autoimmune disease therapeutic platform based on targeting
OX40 and beyond. OX40 has recently been recognized that it plays a central role in many
autoimmune and inflammatory diseases, along with many other receptors, making targeting
these receptors for treating many autoimmune diseases plausible.
Considering that OX40 is broadly involved in many autoimmune diseases with
participation of other receptors, we developed this autoRx40 therapeutic platform which is
centered around OX40 as well as other relevant receptors. Our autoRx40 platform is created by
taking advantages of our V ersatiBody Platform and our OX40 monoclonal antibody molecular
frame which enables us to rapidly create different molecules tailored for specific disease
treatments. Based on that, we have produced several drug candidates, including HX035, a
bispecific antibody that targets two different OX40 epitopes and enhances antibody-dependent
cellular cytotoxicity and blocks OX40-OX40L interactions, and HX038, a bispecific antibody
that targets OX40 and another relevant autoimmune receptor. These candidates are developed
to modulate the immune response by either depleting pathogenic cells or inhibiting their
activation, thereby mitigating autoimmune responses. For details, please refer to “Business –
Research and Development (“R&D”) – Our autoRx40 Platform” in this prospectus.
SUMMARY
–1 3–


--- page 25 ---
COLLABORATION AGREEMENTS
HX008 Equity Transfer Agreements
HX008 is a humanized mAb to PD-1, which was developed by us prior to the Track
Record Period. Taizhou Hanzhong was established by Hangzhou Hanx as its wholly-owned
subsidiary on November 25, 2016, which is the research and development platform for HX008.
On July 19, 2019, the patent of HX008 was granted to Zhongshan Kangfang and Taizhou
Hanzhong.
Given the progress in research and development of HX008, our Group transferred 40% of
our equity interest in Taizhou Hanzhong to an independent third party, namely, Ningbo Houde
Yimin Information Technology Co., Ltd.
* (ʮ̡) by way of equity
transfer and capital injection. Upon completion of this equity transfer in December 2017,
Taizhou Hanzhong was held by Ningbo Houde Yimin and our Group as to 60% and 40%,
respectively.
On September 3, 2019, we entered into an equity transfer agreement with Lepu, a
subsidiary of Ningbo Houde Yimin. Pursuant to this agreement, we shall transfer our 40%
equity interest in Taizhou Hanzhong to Lepu for (i) an aggregate amount of RMB350.0 million
(“One-off Cash Payment ”) to be paid and equity interest to be transferred in instalments as
set out in the payment schedule with no other pre-conditions attached thereto; and (ii) an
annual payment of 4.375% of the net sales revenue of HX008 after its commercialization
(“Annual Fee ”). Prior to the Track Record Period, we received RMB280.0 million of the
One-off Cash Payment, and on August 14, 2024, we entered into the supplemental equity
transfer agreement with Lepu to confirm the completion date for the transfer of our remaining
9% equity interests in Taizhou Hanzhong and payment of the outstanding One-off Cash
Payment of RMB70.0 million. Upon completion of the supplemental equity transfer on August
28, 2024, we ceased to hold any equity interests in Taizhou Hanzhong. As of the Latest
Practicable Date, we have received all outstanding One-off Cash Payment as milestone
payments and have received payment of approximately RMB0.7 million, RMB4.4 million and
RMB13.1 million as the HX008 annual royalty fee in accordance with its net sales revenues
recorded in 2022, 2023 and 2024, respectively.
Through transferring the exclusive rights for manufacturing, development and
commercialization of HX008, we can leverage the manufacturing and commercialization
capabilities of our market-leading business partners. In addition, benefited from Lepu’s strong
capabilities in anti-PD-1 antibody drugs production, the above equity transfers with Lepu
enables us to receive the One-off Cash Payment and the Annual Fee as sharing from the
commercialization of HX008. For details, please refer to “Business – Collaboration
Agreements – HX008 Equity Transfer Agreements” in this prospectus.
SUMMARY
–1 4–


--- page 26 ---
HX301 Onconova Co-development Agreement
In December 2017, we entered into a license, development and commercialization
agreement with Onconova Therapeutics, Inc. (the “ Onconova ”) (the “ Onconova Co-
development Agreement ”). Pursuant to the Onconova Co-development Agreement, Onconova
grants Hangzhou Hanx an exclusive, royalty-bearing license, with the right to sublicense, under
Hangzhou Hanx to develop and commercialize narazaciclib (which was further developed and
named as HX301 for our pipeline) within Greater China. Such development and
commercialization rights include all activities relating to research, non-clinical, preclinical and
clinical, toxicology testing, statistical analysis and reporting, preparation and submission of
applications for regulatory approval of the product and all activities directed to the marketing,
promotion, selling or offering for sale of a product for an indication. In addition, Onconova
shall pay us certain royalties for sales outside of Greater China. For details, please refer to
“Business — Collaboration Agreement — HX301 Onconova Co-development Agreement” in
this prospectus. Currently, Hangzhou Hanx focuses on glioblastoma combination treatment in
China in respect of the development of HX301.
OUR STRENGTHS
We believe the following strengths differentiate us from our competitors:
 The only bifunctional anti-PD-1 antibody SIRP /H9251fusion protein in clinical
development, an innovative PD-1 plus innovative therapy
 Bringing industry-leading expertise in translational medicine to forge a strong
product pipeline addressing unmet medical need
 Strong expertise and capabilities in structural biology and protein engineering
empowered by proprietary technology platforms for enhanced druggability and
sustainable pipeline growth
 Proven business development capabilities bring in strategic partnerships
 Experienced management team and renowned investors
OUR STRATEGIES
We plan to pursue the following opportunities and execute our key strategies accordingly:
 Advance clinical development of our product pipeline
 Continue exploring combination therapies for our product pipeline
 Enhance our research and development capabilities
SUMMARY
–1 5–


--- page 27 ---
 Upgrade our existing platform and build new platforms for new modality drugs
 Enhance business development and strengthen global partnerships
 Continue to build up an internal clinical development team
 Continue to attract and retain talents to fuel our expansion
RESEARCH AND DEVELOPMENT (“R&D”)
We believe that our continuous dedication to research and development is instrumental in
propelling our business expansion and maintaining our competitive edge. At the core of our
R&D approach is a long-standing commitment to innovation in the realm of macromolecule
therapeutics, with a particular focus on addressing unmet clinical needs.
Our R&D team is composed of highly skilled professionals with extensive knowledge and
a profound understanding of immune-oncology, cancer biology, and autoimmune diseases, as
well as translational and clinical sciences. They have been at the forefront in pinpointing
compounds that can regulate various pathways associated with illnesses, which gives us a
distinctive edge in fulfilling the clinical requirements for intricate conditions. Our R&D team
is spearheaded by a group of renowned scientists who bring with them a wealth of experience
in the realm of drug development. As of the Latest Practicable Date, under the supervision of
our chairman and executive Director, Dr. Zhang, our chief business officer, Dr. Tang and led
by our CEO and CSO, Dr. Li, our R&D team consisted of 20 members covering the fields of
biochemistry, biology, pharmacology and clinical science. Our core R&D personnel among our
management team have been working in the biopharmaceutical industry for an average of
approximately 20 years. All of our core R&D personnel have been involved in and contributed
to the R&D activities of the Core Product. During the Track Record Period, none of core R&D
personnel left our Group. To incentivize core R&D personnel to stay with us, we have offered
not only monetary compensation and bonuses but also equity incentives that vest progressively.
Our process research and CMC research team is part of our R&D team with five
experienced employees responsible for both internal early stage wet lab process and method
developments, covering cell development and upstream and downstream processes,
conjugation and analytical, and also project management of the outsourced CMC activities,
which constitute most of ongoing CMC activities at CDMO, including early cell line
construction evaluation, process development and pilot.
Our R&D team is generally responsible for the worldwide development of our Core
Product and other pipeline products. Our R&D team has the capacity to conduct clinical
programs at various development stages in China and other jurisdictions. They have an average
of approximately 10 years working experience in our industry, and almost all of them have
obtained bachelor degrees or higher. For our internally discovered and developed drug
candidates, we conducted drug discovery, quality assurance and clinical activities (together
with the clinical development team) including: (i) orchestrating all clinical development
endeavors; (ii) formulating the principal elements of clinical trials; (iii) arranging and
coordinating the selection of suitable CROs for engaging clinical sites and managing clinical
trials once they are underway; (iv) monitoring the clinical trials; and (v) directing extensive
regulatory interactions and coordination both in China and abroad.
SUMMARY
–1 6–


--- page 28 ---
In line with industry practice, we collaborate with CROs to conduct and support our
preclinical and clinical studies. For the years ended December 31, 2023 and 2024 and the eight
months ended August 31, 2025, we engaged 35, 37 and 28 CROs, respectively, incurring a total
CRO services fees of approximately RMB6.8 million, RMB19.1 million and RMB11.7 million,
respectively. We select our CROs by weighing various factors, such as their qualifications,
academic and professional experience, industry reputation and service fees. To the best of our
Company’s knowledge, all of our CROs during the Track Record Period are Independent Third
Parties.
For the years ended December 31, 2023 and 2024 and the eight months ended August 31,
2024 and 2025, we incurred R&D costs of RMB46.7 million, RMB74.7 million, RMB50.5
million and RMB56.2 million, respectively, representing 73.0%, 61.8%, 75.8% and 67.2% of
our total operating expenses for the corresponding periods, respectively. For the same periods,
we incurred RMB13.5 million, RMB19.4 million, RMB15.6 million and RMB19.4 million for
the R&D of our Core Product, representing 29.0%, 25.9%, 30.9% and 34.5% of our total R&D
costs incurred for the corresponding periods, respectively.
INTELLECTUAL PROPERTY
As of the Latest Practicable Date, we (i) owned seven granted patents, including two
granted patents in the PRC, three granted patents in Japan and two granted patent in the U.S.,
among which, three patents are related to our Core Product; and (ii) have more than 11 pending
patent applications, including one pending patent application in the PRC, three pending patent
applications under the European Patent Convention (among which one patent is related to our
Core Product) and more than seven unpublished pending patent applications under the Patent
Cooperation Treaty. We have four types of patent and patent applications. As reviewed and
advised by our PRC IP Legal Adviser, Jingtian & Gongcheng, all material aspects of the
intellectual property rights of our Core Product and one of our Key Products (HX301) in the
PRC can be covered by certain registered patents or pending patent applications. In addition,
given that we have submitted PCT application with patent priority for one of our Key Products
(HX044), we believe that all material aspects of our two Key Products (HX301 and HX044)
can be covered globally by certain registered patents or pending patent applications.
During the Track Record Period and up to the Latest Practicable Date, we had not been
involved in any proceedings in respect of, and we had not received notice of any claims of
infringement of, any intellectual property rights, in which we may be a claimant or a
respondent. To our best knowledge, we are not aware of any potential or material claims or
disputes in relation to the infringement of intellectual properties of our products during the
Track Record Period.
For details, please refer to “Business – Intellectual Property” in this prospectus.
SUPPLIERS AND RA W MATERIALS
During the Track Record Period, our suppliers primarily consisted of CROs and suppliers
of equipment, devices and construction services. We select our suppliers by considering their
product quality, costs, delivery standards, industry reputation and compliance with relevant
regulations and industry standards.
For the years ended December 31, 2023 and 2024 and the eight months ended August 31,
2025, the aggregate purchases attributable to our five largest suppliers amounted to
approximately RMB16.3 million, RMB28.6 million and RMB23.3 million, respectively,
representing approximately 51.8%, 37.4% and 45.5% of our total purchases, respectively. For
the same periods, purchases attributable to our single largest supplier amounted to
approximately RMB6.4 million, RMB7.8 million and RMB6.3 million, accounting for
approximately 20.4%, 10.2% and 12.4% of our total purchases, respectively.
SUMMARY
–1 7–


--- page 29 ---
None of our five largest suppliers in each period during the Track Record Period was our
related parties. None of our Directors or their associates or, to the knowledge of our Directors,
any Shareholder with over 5% of the share capital of our Company has any interest in any of
our five largest suppliers in the year ended December 31, 2023 and 2024 and the eight months
ended August 31, 2025.
During the Track Record Period, we have procured raw materials and consumables for the
production of our drug candidates. During the Track Record Period, we did not experience any
significant fluctuations in raw material prices or delays that had a material impact on our
results of operations or financial position. The raw materials for our drug candidates to be used
in clinical trials as well as materials for our laboratory use are generally readily available in
the market through multiple suppliers.
EMPLOYEES
As of the Latest Practicable Date, we had a total of 55 employees, among which 49 were
working in China and six were working in Hong Kong.
Mr. Xi, a former employee of our Group, was found to have taken advantage of his
position in our Group and abused his administrative authority and misappropriated funds of our
Group from around December 2016 to May 2020, pursuant to which Mr. Xi was fined and
sentenced to imprison by the courts in the PRC. For further details of these incidents, please
refer to the paragraph headed “Business — Risk management and internal control — Internal
control — Misappropriation of funds by former employee of our Group”.
OUR CONTROLLING SHAREHOLDERS
Immediately following completion of the Global Offering and the Share Split (assuming
the Over-allotment Option is not exercised), Dr. Zhang Faming will hold: (i) approximately
13.06% of the issued share capital of our Company indirectly through Hanx
Biopharmaceuticals (HK), a company indirectly wholly owned by Dr. Zhang through several
of his wholly owned entities, namely HanxBio (BVI), Hanx Biopharmaceuticals and Caizhang
Vision; (ii) approximately 40.60% of the issued share capital of our Company indirectly
through CZ Biotechnology, a company owned as to 99.9% by Dr. Zhang and 0.1% by Ms. Luo
Fang, the spouse of Mr. Zhang Wanming (the brother of Dr. Zhang); and (iii) approximately
2.24% of the issued share capital of our Company through Wuhan Hanx, where CZ
Biotechnology is a general partner. Dr. Zhang, Ms. Luo Fang, CZ Biotechnology, Hanx
Biopharmaceuticals (HK), HanxBio (BVI), Hanx Biopharmaceuticals, Wuhan Hanx and
Caizhang Vision will be presumed to be a group of Controlling Shareholders under the Listing
Rules and will be together interested in approximately 55.89% of the issued share capital of our
Company.
SUMMARY
–1 8–


--- page 30 ---
Apart from our Company, Dr. Zhang also held directorship and shareholding interests in
Waterstone Pharmaceuticals. Waterstone Pharmaceuticals is a company established in the PRC
with limited liability on December 17, 2009 and listed on the NEEQ (stock code: 873938). It
is a company principally engaged in the research and development and sales of chemical drugs
for metabolic diseases such as diabetes and kidney disease. For further details of the
information of Waterstone Pharmaceuticals, please refer to the paragraph headed “Relationship
with our Controlling Shareholders — Our Relationship with Waterstone Pharmaceuticals” in
this prospectus.
We have entered into certain transactions with Waterstone Pharmaceuticals which will
constitute continuing connected transactions upon Listing. For further details of our continuing
connected transactions with Waterstone Pharmaceuticals, please refer to the section headed
“Connected Transactions” in this prospectus.
PRE-IPO INVESTMENTS
We have received three rounds of Pre-IPO investments since our establishment. Our
Pre-IPO Investors include one sophisticated investor, namely, Beijing Lapam, which will hold
approximately 9.44% of the total issued Shares of the Company upon the completion of the
Global Offering, Share Split, and Conversion of Unlisted Shares into H Shares (Assuming the
Over-allotment Option is not exercised). As of the Latest Practicable Date, we have utilized all
the proceeds we received from the Pre-IPO Investment to finance our research and
development activities pursuant to the term of the respective Pre-IPO Investment agreements.
For further details of the identity and background of our Pre-IPO Investors, and the principal
terms of the Pre-IPO Investments, please refer to “History, Development and Corporate
Structure – Pre-IPO Investments” in this prospectus.
SUMMARY
–1 9–


--- page 31 ---
SUMMARY OF KEY FINANCIAL INFORMATION
Summary of Consolidated Statements of Profit or Loss and Other Comprehensive Income
The following table sets forth a summary of our consolidated statements of profit or loss
and other comprehensive income for the periods indicated. Our historical results presented
below are not necessarily indicative of the results that may be expected for any future period.
During the Track Record Period and as of the Latest Practicable Date, we had not generated
any revenue.
For the Y ear Ended
December 31
For the Eight Months
Ended August 31
2023 2024 2024 2025
(in thousands of RMB)
(unaudited)
Other income and gains /H1118/H1118/H1118/H1118/H11186,664 7,681 12,313 2,626
Research and development
costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(46,663) (74,721) (50,523) (56,178)
Administrative expenses /H1118/H1118/H1118/H1118(17,220) (46,192) (16,116) (27,436)
Other expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(33,924) (209) (238) (11,413)
Interest expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(2,280) (9,379) (5,853) (7,532)
Loss before tax /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(93,423) (122,820) (60,417) (99,933)
Income tax expense /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188,263 5,898 11,997 12,495
Loss for the year/period /H1118/H1118/H1118(85,160) (116,922) (48,420) (87,438)
Other comprehensive
income/(loss) for the
year/period, net of tax /H1118/H1118/H1118537 60 242 (423)
Total comprehensive loss
for the year/period /H1118/H1118/H1118/H1118/H1118(84,623) (116,862) (48,178) (87,861)
We have incurred operating losses during the Track Record Period. Our total
comprehensive loss was RMB84.6 million, RMB116.9 million, RMB48.2 million and
RMB87.9 million for the years ended December 31, 2023 and 2024 and the eight months ended
August 31, 2024 and 2025, respectively. Substantially all of our loss resulted from research and
development costs, other expenses, administrative expenses and interest expenses, as a result
of the expansion of our business operations.
For details, please refer to “Financial Information – Description of Selected Components
of Consolidated Statements of Profit or Loss and Other Comprehensive Income” in this
prospectus.
SUMMARY
–2 0–


--- page 32 ---
Summary of Consolidated Statements of Financial Position
The following table sets forth selected information from our consolidated statements of
financial position as of the dates indicated:
As of December 31
As of
August 31
As of
October 31
2023 2024 2025 2025
(in thousands of RMB)
(unaudited)
Total non-current assets /H1118/H1118/H1118/H1118/H1118287,479 258,684 233,449 232,933
Total current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118298,761 242,787 210,849 193,084
Total assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118586,240 501,471 444,298 426,017
Total current liabilities /H1118/H1118/H1118/H1118/H111862,873 197,440 226,080 220,341
Net current
assets/(liabilities) /H1118/H1118/H1118/H1118/H1118/H1118/H1118235,888 45,347 (15,231) (27,257)
Total non-current liabilities /H1118/H1118203,786 87,427 73,427 80,484
Total liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118266,659 284,867 299,507 300,825
Net assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118319,581 216,604 144,791 125,192
Capital and reserves
Paid-in capital /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189,525 11,790 11,790 11,790
Reserves /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118258,603 154,449 86,018 66,869
Non-controlling interests /H1118/H1118/H1118/H111851,453 50,365 46,983 46,533
Total equity /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118319,581 216,604 144,791 125,192
As of December 31, 2023 and 2024 and August 31, 2025, we maintained a net assets
position of RMB319.6 million, RMB216.6 million and RMB144.8 million, respectively.
Fluctuation of our net assets during the Track Record Period was primarily due to the
fluctuations of equity-settled share-based compensation expense, higher administrative costs
and our total comprehensive losses of RMB116.9 million and RMB87.9 million during the year
ended December 31, 2024 and the eight months ended August 31, 2025, respectively. Our net
current assets decreased significantly from RMB235.9 million as of December 31, 2023 to
RMB45.3 million as of December 31, 2024, which were primarily resulted from (i) redemption
liabilities on ordinary shares were reclassified from non-current to current liabilities; and (ii)
the decrease in financial assets at fair value through profit or loss, which was in turn due to
the fluctuation of the forecasted variable consideration for the disposal of HX008. We recorded
net current liabilities of RMB15.2 million as of August 31, 2025, primarily due to the increase
in current liabilities resulting from additional bank borrowings of RMB18.0 million.
For details, please refer to “Financial Information – Discussion of Certain Selected Items
From the Consolidated Statements of Financial Position” in this prospectus.
SUMMARY
–2 1–


--- page 33 ---
Summary of Consolidated Statements of Cash Flows
The following table sets forth the components of our consolidated statements of cash
flows for the periods indicated.
For the Y ear
Ended December 31
For the Eight Months
Ended August 31
2023 2024 2024 2025
(in thousands of RMB)
(unaudited)
Net cash flows used in
operating activities /H1118/H1118/H1118/H1118/H1118/H1118(51,994) (104,894) (67,918) (59,390)
Net cash flows from
investing activities /H1118/H1118/H1118/H1118/H1118/H111893,956 96,620 78,432 35,742
Net cash flows from
financing activities /H1118/H1118/H1118/H1118/H1118/H111890,220 6,486 8,463 12,492
Net increase/(decrease) in
cash and cash equivalents /H1118132,182 (1,788) 18,977 (11,156)
Cash and cash equivalents at
beginning of year /H1118/H1118/H1118/H1118/H1118/H1118/H111829,789 162,000 162,000 161,214
Effect of foreign exchange
rate changes, net /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111829 1,002 369 (58)
Cash and cash equivalents at
end of year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118162,000 161,214 181,346 150,000
For the eight months ended August 31, 2025, our net cash flows used in operating
activities were RMB59.4 million. Our loss before tax for the period was RMB99.9 million for
the same period. The difference between our loss for the year and our net cash flows used in
operating activities was primarily attributable to (i) decrease in other payables and accruals of
RMB3.5 million, partially offset by (i) decrease in prepayments, other receivables and other
assets of RMB2.1 million; (ii) equity-settled share-based compensation expense of RMB16.0
million; (iii) increase in trade payables of RMB3.9 million; and (iv) interest expenses of
RMB7.5 million.
For the year ended December 31, 2024, our net cash flows used in operating activities was
RMB104.9 million. Our loss before tax for the year was RMB122.8 million for the same year.
The difference between our loss for the year and our net cash flows used in operating activities
was primarily attributable to (i) increase in prepayments, other receivables and other assets of
RMB16.3 million; (ii) income taxes paid of RMB5.8 million; (iii) bank interest income of
RMB1.6 million; (iv) fair value gains on FVTPL of RMB1.6 million and (v) interest income
from FVTPL of RMB1.3 million, partially offset by (i) equity-settled share-based
compensation expense of RMB22.3 million; and (ii) depreciation of right-of-use assets of
RMB3.4 million.
SUMMARY
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For the year ended December 31, 2023, our net cash flows used in operating activities was
RMB52.0 million. Our loss before tax for the year was RMB93.4 million for the same period.
The difference between our loss for the year and our net cash flows used in operating activities
was primarily attributable to (i) increase in prepayments, other receivables and other assets of
RMB4.4 million; (ii) interest income from FVTPL of RMB2.3 million; (iii) income taxes paid
of RMB2.1 million; (iv) bank interest income of RMB1.9 million; and (v) decrease in other
payables and accruals of RMB1.0 million, partially offset by (i) equity-settled share-based
compensation expense of RMB15.5 million; (ii) fair value losses on FVTPL of RMB33.1
million.
For details, please refer to “Financial Information – Liquidity and Capital Resources” in
this prospectus.
Going forward, we believe our liquidity requirements will be satisfied by a combination
of net proceeds from the Global Offering, our proceeds from Pre-IPO Investments and transfer
of our equity interests in Taizhou Hanzhong. As of August 31, 2025, our cash and cash
equivalents amounted to RMB150.0 million. Other than the bank borrowings that we may
obtain, we do not have any plans for material external debt financing prior to the Listing.
Assuming an average cash burn rate going forward of 1.9 times the level in 2024, we estimate
that our cash and cash equivalents as of August 31, 2025 will be able to maintain our financial
viability for approximately 31 months, taking into account the estimated net proceeds
(assuming the Over-allotment Option is not exercised, at the Offer Price of HK$28.0 per H
Share, being the low-end of the indicative Offer Price range stated in this prospectus). Taking
these into account, our Directors believe that we have sufficient working capital to cover at
least 125% of our costs, including general, administrative and operating costs as well as
research and development costs, for at least the next 12 months from the Latest Practicable
Date.
KEY FINANCIAL RATIOS
As of December 31
As of
August 31
2023 2024 2025
Current ratio (Note) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184.75 1.23 0.93
Note: Current ratio represents current assets divided by current liabilities as of the same date.
GLOBAL OFFERING STATISTICS
The Global Offering by us comprises:
(i) the Hong Kong Public Offering of initially 1,832,100 Offer Shares (subject to
adjustment as mentioned below) for subscription by the public in Hong Kong as
described in this prospectus as the Hong Kong Public Offering; and
SUMMARY
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(ii) the International Offering of initially 16,488,900 Offer Shares (subject to adjustment
as mentioned below) outside the United States (including to professional and
institutional investors within Hong Kong) in offshore transactions in accordance
with Regulation S under the U.S. Securities Act as described in this prospectus as
the International Offering.
Based on the Offer
Price of HK$28.0 per
H Share
Based on the Offer
Price of HK$32.0 per
H Share
Market capitalization of our H Shares
(approximately) (1) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
HK$3,814.1
million
HK$4,359.0
million
Unaudited pro forma adjusted consolidated
net tangible
assets per H Share
(2) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118HK$5.39 HK$5.91
Notes:
(1) The calculation is based on the assumption that 136,218,830 H Shares will be expected to be in issue
immediately upon completion of the Global Offering (comprising (i) an aggregate of 117,897,830 H
Shares to be converted from Unlisted Shares; and (ii) 18,321,000 Offer Shares to be issued pursuant to
the Global Offering, without taking into account Offer Shares that may be issued upon the exercise of
the Over-allotment Option).
(2) The unaudited pro forma adjusted consolidated net tangible assets value per H Share is calculated after
the adjustment referred to “Unaudited Pro Forma Financial Information” in Appendix II to this
prospectus and on the basis of 136,218,830 H Shares in issue immediately following the completion of
the Global Offering, assuming that the Over-allotment Option is not exercised.
DIVIDEND
We have never declared or paid any dividends on our ordinary shares or any other
securities. 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 intend to declare or pay any
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 subject to our Articles of Association and the PRC
Company Law, 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. No dividend shall be declared or
payable except out of our profits and reserves lawfully available for distribution. Regulations
in the PRC currently permit payment of dividends of a PRC company only out of accumulated
distributable after-tax profits as determined in accordance with its articles of association and
the accounting standards and regulations in China. As confirmed by our PRC Legal Adviser,
according to the PRC law, any future net profit that we make will have to be first applied to
make up for our historically accumulated losses, after which we will be obliged to allocate 10%
of our net profit to our statutory common reserve fund until such fund has reached more than
50% of our registered capital. We will therefore only be able to declare dividends after (i) all
SUMMARY
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our historically accumulated losses have been made up for; and (ii) we have allocated sufficient
net profit to our statutory common reserve fund as described above. As of the Latest Practicable
Date, there was no formal dividend policy or pre-determined dividend payout ratio for our
Group.
USE OF PROCEEDS
We estimate that we will receive net proceeds from the Global Offering of approximately
HK$496.3 million, after deducting underwriting commissions, fees and estimated expenses
payable by us in connection with the Global Offering.
 Approximately 35%, or HK$173.7 million, will be used for the research and
development of our Core Product, namely, HX009;
 Approximately 33%, or HK$163.8 million, will be used for the research and
development of our Key Products, namely, HX301 and HX044;
 Approximately 17%, or HK$84.4 million, will be used for the research and
development of our other important products;
 Approximately 5%, or HK$25.0 million, will be used to fund the commercialization
and/or business development activities; and
 Approximately 10%, or HK$49.4 million, will be used for working capital and other
general corporate purposes.
For details, please refer to “Future Plans and Use of Proceeds” in this prospectus.
RISK FACTORS
We believe that there are certain risks involved in our operations, many of which are
beyond our control. These risks are set out in the section headed “Risk Factors” in this
prospectus. Some of the major risks we face include:
 We may face intense competition and rapid technological change in our industry,
particularly for our Core Product HX009 and the possibility that our competitors
may develop therapies that are similar, or even more advanced and, effective than
ours, which may adversely affect our financial condition and our ability to
successfully commercialize our drug candidates.
 Adverse events or undesirable side effects caused by our drug candidates, such as
our Core Product as a CD47 targeted molecules drug, could interrupt, delay or halt
clinical trials, delay or prevent regulatory approval, limit the commercial profile of
an approved drug, or result in significant negative consequences following any
regulatory approval.
SUMMARY
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 Our business and financial prospects depend substantially on the success of our drug
candidates. If we are unable to successfully complete clinical development, obtain
regulatory approvals or achieve commercialization for our drug candidates, or if we
experience significant delays or cost overruns in doing any of the foregoing, our
business and prospects could be materially and adversely affected.
 Clinical development involves a lengthy and expensive process with uncertain
outcomes, and results of earlier studies and trials may not be predictive of future
trial results.
 We may invest substantial resources in research and development of drug
candidates, allocate our limited resources to pursue a particular drug candidate or
indication and fail to capitalize on drug candidates or indications that may later
prove to be more profitable or for which there is a greater likelihood of success.
 We currently target a sub-group of targeted cancer, and the size of the potential
market for our current or future drug candidates, including for our Core Product
HX009, may be smaller than our estimates.
 We have incurred significant net losses since inception. We anticipate that we will
continue to incur net losses and may fail to achieve or maintain profitability in the
foreseeable future.
 The regulatory approval processes of the NMPA, the FDA and other comparable
regulatory authorities are lengthy, time-consuming and unpredictable. If we are
unable to obtain without undue delay of any regulatory approvals for our drug
candidates in our targeted markets, our business may be subject to actual or
perceived harm.
LISTING EXPENSES
Listing expenses to be borne by us are estimated to be approximately HK$53.5 million
(including underwriting commission, at the Offer Price of HK$30.00 per H Share), which
represent 9.7% of the gross proceeds from the Global Offering, assuming no Offer Shares are
issued pursuant to the Over-allotment Option. The above listing expenses are comprised of (i)
underwriting-related expenses, including underwriter commission, of HK$17.6 million, and (ii)
non-underwriting-related expenses of HK$35.9 million, including (a) the legal advisors and the
Reporting Accountants expenses of HK$20.7 million and (b) other fees and expenses of
HK$15.2 million. During the Track Record Period, listing expenses of approximately HK$15.0
million was charged to our consolidated income statements and approximately HK$7.4 million
was charged to equity. After the Track Record Period, approximately HK$9.9 million is
expected to be charged to our consolidated statements of profit or loss, and approximately
HK$21.2 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.
SUMMARY
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RECENT DEVELOPMENTS AND NO MATERIAL ADVERSE CHANGE
Our recent developments of our drug candidates since the end of the Track Record Period
and up to the Latest Practicable Date include:
 We are currently undergoing three clinical programs for HX009 in China, namely,
(i) the HX009-I-01 China Study (Phase Ib) for treatment of advanced melanoma, (ii)
the HX009-II-02 China Study (Phase I/II) for treatment of R/R EBV
+ NHL, and (iii)
the HX009-II-05 China Study (Phase IIa) for treatment of advanced biliary tract
cancer in combination with a focal adhesion kinase inhibitor (aka. FAKi) drug
developed by InxMed Biotech Co., Ltd. (Shanghai)* (Ҧ(ɪऎ)ʮ
̡). In addition, we also obtained the NMPA approval in February 2025 for a
combination study of HX009 with trastuzumab in patients with advanced triple-
negative breast cancer, and we expect the first patient enrollment for this
combination study to be in 2026. According to the F&S Report, HX009 developed
by our Company is the only bispecific antibody fusion protein targeting both PD-1
and CD47 concurrently in both global and China market as of the Latest Practicable
Date.
 We are currently conducting clinical trials of HX301 in combination with
temozolomide for the treatment of glioblastoma, and as of the Latest Practicable
Date, we have enrolled seven patients for this combination study (i.e., the
HX301-II-01 China Study).
 We are currently conducting the Phase I/IIa clinical study to evaluate the safety and
tolerability of HX044 for the treatment of advanced solid tumor malignancies in
Australia (i.e., the HX044-I-01 Australia Study) and China. As of the Latest
Practicable Date, we have enrolled eight patients for the HX044-I-01 Australia
Study. In addition, we have obtained from NMPA the clinical trial approval
notification for HX044 monotherapy and a combination study of HX044 with
pucotenlimab in patients with advanced solid tumor malignancies in January and
September 2025, respectively (i.e., the HX044-I-01 China Study). The advanced
solid tumor targeted by our product refers to relapsed/refractory solid tumor. As of
the Latest Practicable Date, we have enrolled 15 patients for the monotherapy part
and two patients for the combination therapy part, respectively, for the HX044-I-01
China Study. According to the F&S Report, HX044 is the only CTLA-4/SIRP /H9251
bispecific antibody/bifunctional fusion protein under clinical study globally as of
the Latest Practicable Date.
Our loss for the period increased from RMB48.2 million for the eight months ended
August 31, 2024 to RMB88.3 million for the eight months ended August 31, 2025, primarily
because we incurred increasing research and development expenses as we continue to conduct
and expand our clinical development programs and advance the research and development of
pipeline product candidates that are at preclinical stages and the increasing administrative
expense due to the increasing listing related expenses. Up to the Latest Practicable Date, we
have three pipeline candidates, being our Core Product and Key Products, under clinical stage,
we expect to continue to incur significant expenditure related to the research and development
SUMMARY
–2 7–


--- page 39 ---
activities and clinical studies of our pipeline candidates. We expect a significant increase in net
loss for the year 2025 due to our continuous expenditures on research and development coupled
with clinical development progresses while under the condition of limited source of income.
Our Directors confirm that, there has been no material adverse change in our business,
financial condition and results of operations since August 31, 2025, being the latest balance
sheet date of our consolidated financial statements as set out in the Accountants’ Report
included in Appendix I to this prospectus, and as of the date of this Prospectus.
IMPACT OF THE COVID-19
During the Track Record Period and up to the Latest Practicable Date, we had not
experienced material disruptions in our operations as a result of the COVID-19 pandemic. The
overall impact of the COVID-19 pandemic on our clinical activities, drug development
timeline, business and results of operations has been immaterial, and especially as the
COVID-19 pandemic has come under control as of the Latest Practicable Date and our
Directors are of the view that it is unlikely that COVID-19 pandemic will have material adverse
impact on our business going forward.
REGULATORY DEVELOPMENTS ON OVERSEAS LISTING
On February 17, 2023, the CSRC published the new regulations for the filing-based
administration for overseas securities offerings and listings by domestic companies, which
came into effect on March 31, 2023. The newly released set of regulations consists of Overseas
Listing Trial Measures and relevant guidelines. As advised by our PRC Legal Adviser, our
proposed Listing and Global Offering falls within the scope of direct overseas offering and
listing of PRC domestic companies as provided for in the Overseas Listing Trial Measures, and
therefore we shall be subject to the filing procedures with the CSRC. According to the
Overseas Listing Trial Measures, initial public offerings or listings in overseas markets shall
be filed with the CSRC within three working days after the relevant application is submitted
overseas. As of the Latest Practicable Date, we had completed the required filing procedures
before Listing with the CSRC.
SUMMARY
–2 8–


--- page 40 ---
In this prospectus, unless the context otherwise requires, the following terms shall
have the meanings set out below.
“Accountants’ Report” the accountants’ report set out in Appendix I to this
prospectus
“Advanced biliary tract cancer”
or “Advanced BTC”
metastatic or unresectable tumors that are not amenable
to local therapy with curative intent
“Advanced Melanoma” advanced stage of melanoma, where the cancer has
spread to distant parts of the body, such as the lungs,
liver, brain, and bones, or to distant lymph nodes
“Advanced triple-negative breast
cancer” or “Advanced TNBC”
cancer that has spread to areas away from the breast, such
as the bones, liver, lungs, or brain
“affiliate” 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
“Articles” or “Articles of
Association”
the articles of association of our Company (as amended
from time to time), conditionally adopted on
November 15, 2024 with effect from the Listing Date, a
summary of which is set out in Appendix V to this
prospectus
“Australia” Commonwealth of Australia
“Beijing Hanx” Beijing Hanx Tai Biotech Co. Ltd.* (߅ي
ʮ̡), a company with limited liability established
in the PRC on January 10, 2017 and is a non-wholly
owned subsidiary of our Group
“Beijing Lapam” Beijing Lapam Biopharmaceutical V enture Capital Center
(Limited Partnership)* (ᔼᖹ௴ุҳ༟ʕː
Υྫ
), a limited partnership established in the PRC
on September 9, 2014 and one of our Pre-IPO Investors
DEFINITIONS
–2 9–


--- page 41 ---
“Betta Pharmaceuticals” Betta Pharmaceuticals Co., Ltd. (ʮ
̡), a company established in the PRC on January 7,
2003 and listed on the Shenzhen Stock Exchange (stock
code: 300558), and is one of our Pre-IPO Investors
“Board” or “Board of Directors” the board of directors of our Company
“business day” any day (other than a Saturday, Sunday or public holiday)
on which banks in Hong Kong are generally open for
business
“BVI” the British Virgin Islands
“Caizhang Vision” Caizhang Vision Limited, a company incorporated in the
BVI on January 23, 2019. As of the Latest Practicable
Date, it is one of our Controlling Shareholders
“Capital Market Intermediaries” the capital market intermediaries participating in the
Global Offering and has the meaning ascribed thereto
under the Listing Rules
“CCASS” the Central Clearing and Settlement System established
and operated by HKSCC
“China” or “the PRC” the People’s Republic of China excluding, for the purpose
of this prospectus, Hong Kong, the Macao Special
Administrative Region of the People’s Republic of China
and Taiwan
“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” or “our Company” or
“the Company”
Hanx Biopharmaceuticals (Wuhan) Co., Ltd. (Ўइ
Ҧ(ဏ)ʮ̡), a joint stock
company incorporated in the PRC on December 19, 2014
DEFINITIONS
–3 0–


--- page 42 ---
“Controlling Shareholder(s)” has the meaning ascribed to it under the Listing Rules and
in the context of this prospectus, collectively refers to the
controlling shareholders of our Company, being CZ
Biotechnology, Dr. Zhang, Ms. Luo Fang, Caizhang
Vision, Hanx Biopharmaceuticals, HanxBio (BVI), Hanx
Biopharmaceuticals (HK) and Wuhan Hanx
“Conversion” the conversion of our Company into a joint stock
company as described in the section headed “History,
Development and Corporate Structure” in this prospectus
“Conversion of Unlisted Shares
into H Shares”
The conversion of 117,897,830 Unlisted Shares in
aggregate held by 15 existing Shareholders into H Shares
upon the completion of the Global Offering and the Share
Split. The Company has applied for such conversion of
Unlisted Shares into H Shares with the CSRC on
November 26, 2024, which has been approved by CSRC
on November 12, 2025, and an application has been made
to the Listing Committee for such H Shares to be listed
on the Stock Exchange
“Core Product” has the meaning ascribed to it under Chapter 18A of the
Listing Rules and in this context, refers to HX009
“Corporate Governance Code” the Corporate Governance Code as set out in Part 2 to
Appendix C1 to the Listing Rules
“CSRC” China Securities Regulatory Commission ( ʕ਷ᗇՎ္ຖ
ึ)
“CZ Biotechnology” Cai Zhang Biotechnology (Hangzhou) Co., Ltd.* ( ᇹੵ͛
ப΂ʮ̡), a company with limited
liability established in the PRC on September 7, 2017 and
is owned to 99.9% by Dr. Zhang and 0.1% by Ms. Luo
Fang, respectively. As of the Latest Practicable Date, it is
one of our Controlling Shareholders
“Deed of Non-Competition” the deed of non-competition (ኽ) dated
December 10, 2025 entered into by the Controlling
Shareholders in favor of our Company (for our Company
and as trustee for each of our subsidiaries)
“Director(s)” director(s) of our Company
DEFINITIONS
–3 1–


--- page 43 ---
“Dr. Bi” Dr. Bi Honggang (፻), our independent non-
executive Director
“Dr. Li” Dr. Henry Qixiang Li ( ҽՉജ), our chief executive
officer, chief scientific officer and an executive Director
“Dr. Li Jian” Dr. Li Jian ( ҽ਄), our executive Director
“Dr. Ke” Dr. Ke Hang (ঘ), our Supervisor
“Dr. Zhang” Dr. Zhang Faming (׼our Chairman, an executive
Director and one of our Controlling Shareholders
“Dr. Zhang Qiongguang” Dr. Zhang Qiongguang ( ੵᖘΈ), our independent non-
executive Director
“EIT” enterprise income tax
“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
“F&S” or “Frost & Sullivan” Frost & Sullivan (Beijing) Inc., Shanghai Branch Co., a
market research and consulting company and an
Independent Third Party
“F&S Report” the independent industry report prepared by F&S and
commissioned by our Company, as referred to in the
section headed “Industry Overview” in this prospectus
“Global Offering” the Hong Kong Public Offering and the International
Offering
“Greater China” for the purpose of this prospectus, PRC, Taiwan, the
Special Administrative Region of Hong Kong and the
Special Administrative Region of Macau
“Group”, “our Group”, “the
Group”, “we”, “us”, or “our”
our Company together with its subsidiaries, and their
respective predecessors
DEFINITIONS
–3 2–


--- page 44 ---
“H Share(s)” the ordinary share(s) in the share capital of our Company
with a nominal value of RMB0.1 each, which are to be
subscribed for and traded in Hong Kong dollars and to be
listed and traded on the Stock Exchange
“H Share Registrar” Tricor Investor Services Limited
“Hainan Y angtze” Hainan Y angtze Investment Co. Ltd.* (౮ɿҳ༟Ϟ
ʮ̡), a company with limited liability established in
the PRC on May 16, 2022, and is one of our Pre-IPO
Investors
“Hangzhou Hanx” Hangzhou Hanx Biopharmaceuticals, Ltd.* (͛
ʮ̡), a company with limited liability
established in the PRC on August 3, 2016. As of the
Latest Practicable Date, Hangzhou Hanx is owned as to
85% by our Company and 15% by Wuhan Hanzhong, and
is a non-wholly owned subsidiary of our Group
“Hangzhou Hanx (HK)” Hangzhou HanX Biopharmaceuticals (HK) Co.,
Limited (ᔼᖹ(ಥ)ʮ̡), a company
incorporated in Hong Kong with limited liability on
February 19, 2024. As of the Latest Practicable Date, it is
a non-wholly owned subsidiary of our Group
“Hangzhou Hongye Ruiji” Hangzhou Hongye Ruiji Investment Partnership (Limited
Partnership)* (Υྫ
), a
limited partnership established in the PRC on May 20,
2016, and is one of our Pre-IPO Investors
“Hangzhou Taikun” Hangzhou Taikun Equity Investment Fund Partnership
(Limited Partnership)* (ΥྫΆุ
Υྫ
), a limited partnership established in the PRC
on August 10, 2021, and is one of our Pre-IPO Investors
“Hanx Biopharmaceuticals” HanX Biopharmaceuticals Limited, a company
incorporated in the Cayman Islands on January 30, 2019
and is one of our Controlling Shareholders
“Hanx Biopharmaceuticals
(Australia)”
Hanx Biopharmaceuticals Pty Ltd, a company
incorporated in Australia with limited liability on April
19, 2024. As of the Latest Practicable Date, it is wholly
owned by our Company and is a direct wholly owned
subsidiary of our Group
DEFINITIONS
–3 3–


--- page 45 ---
“Hanx Biopharmaceuticals (HK)” Hanx Biopharmaceuticals (HK) Limited (ᔼᖹ
ʮ̡), a company incorporated in Hong Kong
with limited liability on April 1, 2022 and is one of our
Controlling Shareholders
“HanxAimtech” HanxAimtech Biopharmaceutical Limited (ي
ʮ̡), a company incorporated in
Hong Kong with limited liability on August 23, 2023. As
of the Latest Practicable Date, it is a wholly owned
subsidiary of our Group
“HanxBio (Australia)” Waterstone Hanxbio PTY Ltd.* (Ϟ
ʮ̡), a company incorporated in Australia with
limited liability on October 26, 2018. As of the Latest
Practicable Date, it is wholly owned by Hangzhou Hanx
and is an indirect non-wholly owned subsidiary of our
Group
“HanxBio (BVI)” HanXBio (BVI) Limited, a company incorporated in the
BVI with limited liability on February 21, 2022 and is
one of our Controlling Shareholders
“HK eIPO White Form ” the application for Hong Kong Offer Shares to be issued
in the applicant’s own name by submitting applications
online through the designated website at www.hkeipo.hk
“HK eIPO White Form Service
Provider”
the HK eIPO White Form service provider designated
by our Company, as specified on the designated website
at www.hkeipo.hk
“HKFRSs” Hong Kong Financial Reporting Standards issued by the
Hong Kong Institute of Certified Public Accountants
“HKSCC” Hong Kong Securities Clearing Company Limited
“HKSCC EIPO” the application for the Hong Kong Offer Shares to be issued
in the name of HKSCC Nominees and deposited directly
into CCASS to be credited to your designated HKSCC
Participant’s stock account through causing HKSCC
Nominees to apply on your behalf, including by instructing
your broker or custodian who is a Clearing Participant or a
Custodian Participant in HKSCC to give electronic
application instructions via HKSCC’s FINI system to
apply for the Hong Kong Offer Shares on your behalf
DEFINITIONS
–3 4–


--- page 46 ---
“HKSCC Nominees” HKSCC Nominees Limited, a wholly-owned subsidiary
of HKSCC
“HKSCC Participant” a participant admitted to participate in CCASS as a direct
clearing participant, a general clearing participant or a
custodian participant
“Hong Kong” or “HK” the Hong Kong Special Administrative Region of the
PRC
“Hong Kong dollars” or
“HK dollars” or “HK$”
Hong Kong dollars, the lawful currency of Hong Kong
“Hong Kong Offer Shares” the 1,832,100 H Shares being initially offered for
subscription in the Hong Kong Public Offering, subject to
reallocation as set out in the section headed “Structure of
the Global Offering” in this prospectus
“Hong Kong Public Offering” the offer of the Hong Kong Offer Shares for subscription
by the public in Hong Kong as set out in the section
headed “Structure of the Global Offering” in this
prospectus
“Hong Kong Underwriters” the underwriters of the Hong Kong Public Offering listed
in the section headed “Underwriting — Hong Kong
Underwriters and International Underwriters” in this
prospectus
“Hong Kong Underwriting
Agreement”
the underwriting agreement dated December 12, 2025
relating to the Hong Kong Public Offering and entered
into by, among others, us, the Sponsor-Overall
Coordinator and the Hong Kong Underwriters as further
described in the section headed “Underwriting —
Underwriting Arrangements and Expenses” in this
prospectus
“HX009-I-01 Australia Study” clinical study of HX009 for treatment of patients with
advanced malignancies (i.e., relapsed/refractory solid
tumor), which was completed in October 2022
“HX009-I-01 China Study
(Phase Ia)”
clinical study of HX009 for treatment of patients with
advanced solid tumor (i.e., relapsed/refractory solid
tumor), which was completed in July 2024
DEFINITIONS
–3 5–


--- page 47 ---
“HX009-I-01 China Study
(Phase Ib)”
clinical study of HX009 for treatment of patients with
advanced melanoma (i.e., unresectable/metastatic
melanoma), which was ongoing as of the Latest
Practicable Date
“HX009-II-02 China Study” clinical study of HX009 for treatment of patients with
relapsed/refractory lymphoma (including
relapsed/refractory Epstein-Barr virus positive non-
Hodgkin lymphoma), which was ongoing as of the Latest
Practicable Date
“HX009-II-04 China Study” clinical study of HX009 for treatment of patients with
advanced triple-negative breast cancer (i.e., previously
treated unresectable or metastatic triple-negative breast
cancer with HER2-low or ultra-low), which was not
commenced as of the Latest Practicable Date
“HX009-II-05 China Study” clinical study of HX009 for treatment of patients with
advanced biliary tract cancer (i.e., previously treated
unresectable/metastatic biliary tract cancer), which was
ongoing as of the Latest Practicable Date
“HX044-I-01 Australia Study” clinical study of HX044 for treatment of patients with
advanced solid tumor malignancies (i.e., relapsed/
refractory solid tumor), which was ongoing as of the
Latest Practicable Date
“HX044-I-01 China Study” clinical study (including monotherapy and combination
therapy) of HX044 for treatment of patients with
advanced solid tumor malignancies (i.e., relapsed/
refractory solid tumor), which was ongoing as of the
Latest Practicable Date
“HX301-I-01 China Study” clinical study of HX301 for treatment of patients with
advanced solid tumor (i.e., relapsed/refractory solid
tumor), which was completed in July 2024
“Independent Third Party(ies)” a person or entity who is not considered as a connected
person of our Company under the Listing Rules
DEFINITIONS
–3 6–


--- page 48 ---
“International Offer Shares” the 16,488,900 H Shares being initially offered by us for
subscription or purchase under the International Offering
together with, where relevant, any additional H Shares
which may be issued by us pursuant to the exercise of the
Over-allotment Option, subject to reallocation
“International Offering” the conditional offering of the International Offer Shares
to institutional, professional and other investors as set out
in the section headed “Structure of the Global Offering”
in this prospectus
“International Underwriters” the underwriters of the International Offering
“International Underwriting
Agreement”
the international underwriting agreement expected to be
entered into by, among others, us, the Sponsor-Overall
Coordinator and the International Underwriters on or
about the Price Determination Date in respect of the
International Offering, as further described in the section
headed “Underwriting — International Offering” in this
prospectus
“Joint Bookrunners” the joint bookrunners as named in the section headed
“Directors, Supervisors and Parties Involved in the
Global Offering”
“Joint Global Coordinators” the joint global coordinators as named in the section
headed “Directors, Supervisors and Parties Involved in
the Global Offering”
“Joint Lead Managers” the joint lead managers as named in the section headed
“Directors, Supervisors and Parties Involved in the
Global Offering”
“Key Product(s)” in this context, refers to HX301, and/or HX044
“Lapam Capital” Lapam Capital HK Co., Limited, a company incorporated
in Hong Kong with limited liability on December 30,
2021, and is one of our Pre-IPO Investors
“Latest Practicable Date” December 8, 2025, being the latest practicable date prior
to the printing of this prospectus for the purpose of
ascertaining certain information contained in this
prospectus
DEFINITIONS
–3 7–


--- page 49 ---
“Lepu” Lepu Biopharma Co., Ltd. (ʮ̡),
a joint stock company incorporated in the PRC with
limited liability, the H Shares of which are listed on the
Stock Exchange (stock code: 2157)
“Listing” the listing of the H Shares on the Main Board of the Stock
Exchange
“Listing Committee” the listing committee of the Stock Exchange
“Listing Date” the date, expected to be on or around Tuesday, December
23, 2025, on which the H Shares are listed on the Stock
Exchange and from which dealings in the H Shares are
permitted to commence on the Stock Exchange
“Main Board” the stock market (excluding the options market) operated
by the Stock Exchange and which is independent from
and operated in parallel with the GEM of the Stock
Exchange
“Mr. Chen” Mr. Chen Qifeng (ࢤour independent non-
executive Director
“Mr. Li” Mr. Li Kin Wai (۾one of our joint company
secretaries
“Mr. Liao” Mr. Liao Tong ( ࿋ҕ), one of our Pre-IPO Investors
“Mr. Liu” Mr. Liu Min ( ᄎઽ), our chief operating officer and
executive Director
“Mr. Wong” Mr. Wong Sai Hung ( ˮ˰ඪ), our independent non-
executive Director
“Mr. Xi” Mr. Xi Gan (͚), a former director and general manager
of Hangzhou Hanx, a former director, legal representative
and manager of Wuhan Hanxiong and a former manager
and legal representative of Beijing Hanx
“Mr. Zhang Hui” Mr. Zhang Hui ( ੵሾ), our chief financial officer, one of
our joint company secretaries, and the secretary of our
Board
“Mr. Zhang Wanming” Mr. Zhang Wanming (׼the brother of Dr. Zhang
DEFINITIONS
–3 8–


--- page 50 ---
“Mr. Zou” Mr. Zou Zhiyong (ۇone of our Pre-IPO Investors
“Ms. Chen” Ms. Chen Chen ( ௓ો), our Supervisor
“Ms. Sun” Ms. Sun Peng (ᘄ), our Supervisor
“Ms. Xiao” Ms. Xiao Jieyu ( ӽẘѹ), our non-executive Director and
one of our Pre-IPO Investors
“Ms. Zhang” Ms. Zhang Lei ( ੵᆾ), our chief medical officer and a
member of the senior management of our Group
“NEEQ” The National Equities Exchange and Quotations ( Ό਷ʕ
΅ᔷᜫӻ୕)
“NMPA” National Medical Products Administration of the PRC
“Offer Price” the final offer price per Offer Share (exclusive of
brokerage of 1.0%, SFC transaction levy of 0.0027%,
AFRC transaction levy of 0.00015% and Hong Kong
Stock Exchange trading fee of 0.00565%) of not more
than HK$32.0 and expected to be not less than HK$28.0,
at which Hong Kong Offer Shares are to be subscribed, to
be determined in the manner further described in the
section headed “Structure of the Global Offering” in this
prospectus
“Offer Share(s)” the Hong Kong Offer Shares and the International Offer
Shares together with, where relevant, any additional H
Shares which may be issued by us pursuant to the
exercise of the Over-allotment Option
“Over-allotment Option” the option expected to be granted by us to the
International Underwriters, exercisable by the Sponsor-
Overall Coordinator (for itself and on behalf of the
International Underwriters), pursuant to which we may
be required to allot and issue up to an aggregate of
2,748,100 H Shares at the Offer Price to, among other
things, cover over-allocations in the International
Offering, if any
DEFINITIONS
–3 9–


--- page 51 ---
“Overall Coordinators” ICBC International Securities Limited, China Securities
(International) Corporate Finance Company Limited,
China Merchants Securities (HK) Co., Limited, Haitong
International Securities Company Limited and CCB
International Capital Limited
“PBOC” People’s Bank of China ( ʕ਷ɛ͏ვБ)
“PRC Company Law” the Company Law of the PRC ( ʕശɛ͏΍ձ਷ʮ̡
), as enacted by the 5th session for the Standing
Committee of the 8th National People’s Congress on
December 29, 1993 and became effective on July 1, 1994,
as amended, supplemented or otherwise modified from
time to time
“PRC Government” or “State” the central government of the PRC, including all political
subdivisions (including provincial, municipal and other
regional or local government entities) and its organs or,
as the context requires, any of them
“PRC IP Legal Adviser” Jingtian & Gongcheng, the legal adviser to our Company
as to the intellectual property laws of the PRC
“PRC Legal Adviser” Jingtian & Gongcheng, the legal adviser to our Company
as to the laws of the PRC
“Pre-IPO Investments” the investment made by the Pre-IPO Investors in our
Company as identified in the section headed “History,
Development and Corporate Structure — Pre-IPO
Investment” in this prospectus
“Pre-IPO Investors” Series A Investors, Series B Investors and Series B+
Investors
“Price Determination Date” the date, expected to be no later than Friday, December
19, 2025, on which the Offer Price will be determined
“Regulation S” Regulation S under the U.S. Securities Act
“Reporting Accountants” Ernst & Y oung
“RMB” or “Renminbi” Renminbi, the lawful currency of the PRC
“SAFE” the State Administration of Foreign Exchange of the PRC
(ʕശɛ͏΍ձ਷̮ි၍ଣ҅)
DEFINITIONS
–4 0–


--- page 52 ---
“SAMR” the State Administration for Market Regulation (̹
ఙ္ຖ၍ଣᐼ҅)
“SA T” State Administration of Taxation of the PRC ( ʕശɛ͏΍
೼ਕᐼ҅)
“Series A Investors” Beijing Lapam, Betta Pharmaceuticals and Hangzhou
Hongye Ruiji
“Series B Investors” Wuhan Donggaorensi, Hangzhou Taikun, Lapam Capital,
Tibet Lapam, Ms. Xiao, Mr. Liao and Mr. Zou
“Series B+ Investors” Hainan Y angtze and Y angtze Hong Kong
“SFC” Securities and Futures Commission of Hong Kong
“SFO” Securities and Futures Ordinance (Chapter 571 of the
Laws of Hong Kong), as amended or supplemented from
time to time
“Share(s)” ordinary shares in the share capital of the Company with
a nominal value of RMB0.1 each
“Share Split” the split of our Company’s registered Shares with
nominal value of RMB1 each into 10 Shares with
nominal value of RMB0.1 each, which is approved on
November 15, 2024 and effective upon completion of the
Global Offering
“Shareholder(s)” holder(s) of our Shares
“Shenzhen Stock Exchange” the Shenzhen Stock Exchange
“Sole Sponsor” ICBC International Capital Limited, a corporation
registered under the SFO permitted to carry on Type 1
(dealing in securities), Type 4 (advising on securities)
and Type 6 (advising on corporate finance) regulated
activities under the SFO
“Sponsor-Overall Coordinator” ICBC International Securities Limited
“Stock Exchange” The Stock Exchange of Hong Kong Limited
“Supervisor(s)” supervisor(s) of our Company
DEFINITIONS
–4 1–


--- page 53 ---
“Supervisory Committee” supervisory committee of our Company
“Taizhou Hanzhong” Taizhou Hanzhong Biopharmaceutical Co., Ltd.* ( इψጫ
ʮ̡), a limited liability company
established in the PRC on November 25, 2016 and a
former subsidiary of Hangzhou Hanx
“Takeovers Code” The Codes on Takeovers and Mergers and Share Buy-
backs
“Tibet Lapam” Tibet Lapam Small and Medium Enterprise Development
Fund Equity Investment Partnership (Limited
Partnership)* (ᛆҳ༟Υྫ
Υྫ
), a limited partnership established in the PRC
on June 2, 2022 and is one of our Pre-IPO Investors
“Track Record Period” the two financial years ended December 31, 2023 and
2024 and the eight months ended August 31, 2025
“U.S.” or “United States” the United States of America
“U.S. dollars” or “US$” U.S. dollars, the lawful currency of the United States
“U.S. Securities Act” the United States Securities Act of 1933, as amended
from time to time, and the rules and regulations
promulgated thereunder
“Underwriters” the Hong Kong Underwriters and the International
Underwriters
“Underwriting Agreements” the Hong Kong Underwriting Agreement and the
International Underwriting Agreement
“Unlisted Share(s)” ordinary share(s) in the share capital of our Company,
with a nominal value of RMB1 each, which are
subscribed for and paid up in Renminbi and are unlisted
Shares not currently listed or traded on any stock
exchange
“V A T” value-added tax
DEFINITIONS
–4 2–


--- page 54 ---
“Waterstone Pharmaceuticals” Waterstone Pharmaceuticals (Wuhan) Co., Ltd.* (ശ
ʮ̡), a company
established in the PRC on December 17, 2009, listed on
the NEEQ (stock code: 873938) with Dr. Zhang as one of
the controlling shareholders
“Wuhan Donggaorensi” Wuhan Donggaorensi Equity Investment Partnership
(Limited Partnership)* (ᛆҳ༟ΥྫΆ
ุ(Υྫ)), a limited partnership established in the
PRC on December 28, 2022 and is one of our Pre-IPO
Investors
“Wuhan Hanx” Wuhan Hanx Tai Management Consulting Partnership
(Limited Partnership)* (इ၍ଣፔ༔ΥྫΆุ
(Υྫ)), a limited partnership established in the PRC
on June 3, 2024, is our employee shareholding platform
and is one of our Controlling Shareholders
“Wuhan Hanxiong” Wuhan Hanxiong Biotech Co. Ltd.* (Ҧஔ
ʮ̡), a company established in the PRC with
limited liability on November 19, 2013 and is an indirect
non-wholly owned subsidiary of our Company
“Wuhan Hanzhong” Wuhan Hanzhong Biotechnology Co., Ltd.* (ဏᖍʕ͛
ʮ̡), a company established in the PRC
with limited liability on July 15, 2016 and holds 15%
equity interests in Hangzhou Hanx
“Y angtze Hong Kong” Y angtze Investment (HK) Limited, a company
incorporated in Hong Kong with limited liability on
February 16, 2017, and is one of our Pre-IPO Investors
“Zhongshan Kangfang” Zhongshan Kangfang Biopharmaceuticals Ltd.* ( ʕ
ʮ̡), an indirect wholly-owned
subsidiary of an independent third party that listed on the
Main Board of the Stock Exchange
Unless otherwise expressly stated or the context otherwise requires, all data in this
prospectus is as of the Latest Practicable Date.
In this prospectus, the terms “associate”, “close associate”, “connected person”, “core
connected person”, “connected transaction”, “subsidiaries” and “substantial shareholder”
shall have the meanings given to such terms in the Listing Rules, unless the context otherwise
requires.
DEFINITIONS
–4 3–


--- page 55 ---
Certain amounts and percentage figures included in this prospectus 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.
The English names of PRC entities, PRC laws or regulations, and PRC governmental
authorities referred to in this prospectus are translations from their Chinese names and are for
identification purposes. If there is any inconsistency, the Chinese names shall prevail. The
English translation of names or any descriptions in Chinese marked with “*” is for
identification purposes only.
DEFINITIONS
–4 4–


--- page 56 ---
This glossary contains definitions of certain technical terms used in this prospectus
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.
“adaptive immunity” a type of immunity that functions as the second line of
defense that identifies and eliminates specifically
presented foreign substance or antigens
“ADC” antibody drug conjugate, a class of biopharmaceutical
drugs that combine monoclonal antibodies specific to
surface antigens present on particular tumor cells with
highly potent antitumor small molecule agents linked via
a chemical linker
“ADCC” an immune mechanism through which Fc
receptor-bearing effector cells can recognize and kill
antibody-coated target cells expressing tumor- or
pathogen-derived antigens on their surface
“ADCP” the mechanism by which antibody-opsonized target cells
activate the Fc receptors on the surface of phagocytes to
induce phagocytosis, resulting in internalization and
degradation of the target cell through phagosome
acidification
“AE” adverse event, i.e., any undesirable experience associated
with the use of a medical product in a patient
“affinity” the extent or fraction to which a drug binds to receptors
at any given drug concentration or the firmness with
which the drug binds to the receptor. Affinity describes
the strength of the attraction between two chemicals, or
an antigen and an antibody
“AITL” angioimmunoblastic T-cell lymphoma
“AML” acute myeloid leukemia
“antibody” a blood protein produced in response to and
counteracting a specific antigen. Antibodies combine
chemically with substances which the body recognizes as
alien, such as bacteria, viruses, and foreign substances in
the blood
GLOSSARY OF TECHNICAL TERMS
–4 5–


--- page 57 ---
“antibody fusion protein” constructs that combine an antibody targeted to a specific
antigen, typically a tumor-related antigen, with a protein
that is able to amplify the immune response or induce
direct damage to the cancer cell
“antigen” molecule that stimulates an immune response by
activating lymphocytes
“antigen sink” the phenomenon of the “antigenic sink” occurs when the
expression of intended targets on normal tissue prevents
therapeutic antibodies or drugs from reaching their
intended tumor cell targets in the body. This “antigenic
sink” phenomenon can necessitate a higher dose to
achieve the minimum effective concentration threshold
“APC” antigen presenting cells, a heterogeneous group of
immune cells that mediate the cellular immune response
by processing and presenting antigens for recognition by
certain lymphocytes such as T cells
“apoptosis” programmed cell death, a genetically directed process of
cell self-destruction that is marked by the fragmentation
of nuclear DNA
“ARK5” AMPK-associated protein kinase 5
“A TL” adult T-cell leukaemia/lymphoma
“autoimmune” with respect to any disorder or disease, the response that
occurs when the immune system goes awry and attacks
the body itself. Autoimmunity, present to some extent in
everyone, is usually harmless but it can cause a broad
range of human illnesses, known collectively as
“autoimmune diseases”
“B cell(s)” or “B lymphocyte(s)” a type of white blood cell, which are the results of
multipotential cell differentiation in the bone marrow and
mainly responsible for producing antibodies
“BC” breast cancer
“bispecific antibody” or “BsAb” antibodies with two binding sites directed at two different
targets or two different epitopes on the same target
GLOSSARY OF TECHNICAL TERMS
–4 6–


--- page 58 ---
“BLA” biologics license application
“B-NHL” B-cell non-Hodgkin lymphoma
“BTC” biliary tract cancer
“CAGR” compound annual growth rate
“carcinoma” a cancer that begins in the lining layer (epithelial cells) of
organs
“CAR-T” chimeric antigen receptor T cell immunotherapy
“CC” cervical cancer
“ccRCC” clear cell renal cell carcinoma
“CD20” cluster of differentiation 20, a cell surface protein widely
expressed on B cells
“CD40” cluster of differentiation 40, a costimulatory protein
found on antigen-presenting cells, essential in mediating
immune and inflammatory responses
“CD47” cluster of differentiation 47, also known as integrin
associated protein, a membrane protein which provides a
“don’t eat me” signal to macrophages
“CD80” cluster of differentiation 80, one of the proteins in the
immunoglobulin superfamily, a type I transmembrane
protein on activated B cells, activated monocytes,
activated follicular dendritic cells, and some activated
T cells, which provides a costimulatory signal to T cells
during antigen presentation
“CD86” cluster of differentiation 86, a costimulatory molecule
belonging to the immunoglobulin superfamily expressed
on dendritic cells, macrophages, B cells, and other
antigen-presenting cells
“CD94” a type II transmembrane glycoprotein of 30 kDa,
belonging to the Ca++-dependent (C-type) lectin family
“CDK4/6” cell cycle-independent kinase 4/6
GLOSSARY OF TECHNICAL TERMS
–4 7–


--- page 59 ---
“CDMO” contract development and manufacturing organization,
which is a pharmaceutical company that develops and
manufactures drugs for other pharmaceutical companies
on a contractual basis
“cell line” a population of cells which descend from a single cell and
contain the same genetic makeup, thereby producing the
same proteins. The productivity of a cell line determines
the cost of manufacturing and the quality of a cell line is
directly related to the quality of the relevant biologics
“CEO” chief executive officer
“cGMP” current Good Manufacturing Practice
“chemokine” a family of small cytokines or signaling proteins secreted
by cells that induce directed chemotaxis in nearby
responsive cells
“chemotherapy” a category of cancer treatment that uses one or more
anti-cancer chemotherapeutic agents as part of its
standardized regimen
“clinical trial” a research study for validating or finding the therapeutic
effects and side effects of test drugs in order to determine
the therapeutic value and safety of such drugs
“CLL” chronic lymphocytic leukemia
“CMC” chemistry, manufacturing, and controls processes,
including manufacturing techniques, impurities studies,
quality controls and stability studies
“CMO” chief medical officer
“cohort” a group of patients as part of a clinical study who share
a common characteristic or experience within a defined
period and who are monitored over time
“cold tumor” tumor that is not likely to trigger a strong immune
response. Cold tumor tends to be surrounded by cells that
are able to suppress the immune responses and keep T
cells from attacking and killing the tumor cells
GLOSSARY OF TECHNICAL TERMS
–4 8–


--- page 60 ---
“combination therapy” or
“combo”
treatment in which a patient is given two or more drugs
(or other therapeutic agents) for a single disease
“compound” a substance consisting of two or more elements in union
“CR” complete response, which means that all target lesions
have disappeared during the course of treatment
“CRC” colorectal cancer
“CRO” contract research organization
“CSF1R” colony-stimulating factor-1 receptor
“CSO” chief scientific officer
“CTLA-4” cytotoxic T-lymphocyte-associated protein 4, which
down-regulates T cell immune response to cancer cells
“cytokine” a broad and loose category of small proteins that are
important in cell signaling, whose release has an effect on
the behavior of cells expressing corresponding
receptors/ligands
“cytotoxic” toxic to living cells
“cytotoxicity” the term for how toxic a substance is to cells, a cytotoxic
compound can cause cell damage or death, either through
necrosis or apoptosis
“dendritic cell(s)” or “DC” cells that constantly sample their surroundings for
pathogens such as viruses and bacteria, detect dangers,
and initiate immune responses. Immature patrolling
dendritic cells have high endocytic activity and a low
T cells activation potential. Contact with a pathogen
induces maturation and the expression of certain
cell-surface molecules, greatly enhancing their ability to
activate T cells
“DLBCL” diffuse large B-cell lymphoma, a common type of
non-Hodgkin’s lymphoma that starts in lymphocytes
GLOSSARY OF TECHNICAL TERMS
–4 9–


--- page 61 ---
“DLT” dose-limiting toxicity, side effects of a drug or other
treatment that are serious enough to prevent an increase
in dose of that treatment in clinical trial
“drug resistance” the reduction in effectiveness of a drug in curing a
disease
“druggability” the ability of a target to be therapeutically modulated by
medicines
“EBV
+ NHL” Epstein-Barr virus positive non-Hodgkin lymphoma
“EC” esophageal cancer
“EMT“ Epithelial mesenchymal transition
“ESCC” esophageal squamous cell carcinoma, a high-mortality
cancer with complex etiology and progression involving
both genetic and environmental factors
“FAKi” focal adhesion kinase inhibitors
“Fc” or “Fc region” fragment crystallizable region, which is the tail region of
an antibody that interacts with cell surface receptors
called Fc receptors and some proteins of the complement
system
“Fc/H9253R” Fc-gamma receptor, a receptor for the Fc region of
immunoglobulin
“FDA” the Food and Drug Administration of the United States
“FLT-3” FMS-like tyrosine kinase 3
“fusion protein” proteins consisting of at least two domains that are
encoded by separate genes
“GC” gastric cancer
“GEJ” gastroesophageal junction
“GLP” a system where non-clinical health and safety studies are
carried out, planned, monitored, recorded, archived and
reported
GLOSSARY OF TECHNICAL TERMS
–5 0–


--- page 62 ---
“GMP” a system for ensuring that products are consistently
produced and controlled according to quality standards,
which is designed to minimize the risks involved in any
pharmaceutical production that cannot be eliminated
through testing the final product. It is also the practice
required in order to conform to the guidelines
recommended by agencies that control the authorization
and licensing of the manufacture and sale of
pharmaceutical products
“Grade” term used to refer to the severity of adverse events, using
Grade 1, Grade 2, Grade 3, etc.
“GvHD” a severe complication that can occur following
hematopoietic stem cell transplantation. This condition
arises when immunocompetent T lymphocytes from the
donor graft recognize the recipient’s tissues as foreign
due to histocompatibility differences and initiate an
immune response against them
“half-life” the period of time required for the concentration or
amount of a drug in the body to be reduced to exactly
one-half of a given concentration or amount of such drug
“HCC” hepatocellular carcinoma
“hemagglutination” clumping together of red blood cells, a form of
agglutination that involves red blood cells
“heterodimer” a protein composed of two polypeptide chains differing in
the sequence, number and kind of their amino acid
residues
“HREC” Human Research Ethics Committee
“HLA-E” human leukocyte antigen-E
“HNSCC” head and neck squamous cell carcinoma
“ICC” intrahepatic cholangiocarcinoma
“ICH GCP” an ethical, scientific and quality standard for the conduct
of trials that involve human participants
GLOSSARY OF TECHNICAL TERMS
–5 1–


--- page 63 ---
“IgG” immunoglobulin G, the most common type of antibody
found in blood circulation, which plays an essential role
in immune system
“IgG1” immunoglobulin G1
“IgG4” immunoglobulin G4
“IL” interleukin, a type of cytokine and signaling molecule in
the immune system to provoke an immune response in the
body of a human or other animals
“IL-17” interleukin-17
“IL-4R” interleukin 4 receptor
“immune checkpoint” regulators of the immune system, which are crucial for
self-tolerance as they prevent the immune system from
attacking cells indiscriminately. Certain cancers may
protect themselves from attack by stimulating immune
checkpoint targets
“immune checkpoint inhibitor” or
“ICI”
a type of drugs that block certain proteins made by some
types of immune system cells, and/or cancer cells, which
help promote immune responses and allow immune cells
to kill cancer cells
“immunogenicity” the ability of a particular substance, such as an antigen or
epitope, to provoke an immune response in the body of a
human and other animal. In other words, immunogenicity
is the ability to induce a humoral and/or cell-mediated
immune responses
“immuno-oncology” a type of cancer treatment that uses the power of the
body’s own immune system to prevent, control and
eliminate cancer
“immuno-oncology therapy” or
“immunotherapy”
a type of therapy that involves the immune system to help
the body fight cancer, infection, and other diseases
“in vitro ” Latin for “within the glass,” studies using components of
an organism that have been isolated from their usual
biological surroundings, such as microorganisms, cells or
biological molecules
GLOSSARY OF TECHNICAL TERMS
–5 2–


--- page 64 ---
“in vivo ” Latin for “within the living,” studies in which the effects
of various biological or chemical substances are tested on
whole, living organisms as opposed to a partial or dead
organism, or those done in vitro
“IND” investigational new drug or investigational new drug
application, also known as clinical trial application in
China or the U.S.
“indication” a sign, symptom, or medical condition that leads to the
recommendation of a treatment, test, or procedure
“inhibitor” a chemical or substance added or applied to another
substance to slow down a reaction or to prevent an
unwanted chemical change
“innate immunity” an immunity system that forms the body’s first line of
defense and consists of proteins and cells that identify
foreign substances and provide an immediate immune
response
“irAEs” immune-related adverse effect(s)
“LAG-3” a cell surface molecule expressed on activated T cells,
NK cells, B cells, and plasmacytoid dendritic cells,
playing an important role in the function of these
lymphocyte subsets
“leukemia” cancer of the body’s blood-forming tissues, including the
bone marrow and the lymphatic system
“leukocyte” part of the body’s immune system that helps the body
fight infection and other diseases
“macrophage” a type of white blood cell that plays a role to phagocytose
antigens, removes dead cells, and stimulates the action of
other immune system cells
“MCL” mantle cell lymphoma
“mCRPC” metastatic castration-resistant prostate cancer
“MDS” myelodysplastic syndrome
GLOSSARY OF TECHNICAL TERMS
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--- page 65 ---
“MEM” malignant epithelioid mesothelioma
“metastasis” or “metastases” the stage that cancer has spread to a different part of your
body part than where it started
“metastatic” in reference to any disease, including cancer, disease
producing organisms or of malignant or cancerous cells
transferred to other parts of the body by way of the blood
or lymphatic vessels or membranous surfaces
“MHC” major histocompatibility complex
“MHC-I” major histocompatibility complex class I
“MM” multiple myeloma
“MoA(s)” mechanism of action(s)
“monoclonal antibody” or “mAb” a monospecific antibody against a specific epitope on an
antigen made by identical immune cells that are all clones
of a unique parent cell, in contrast to polyclonal
antibodies which are made from hundreds of different
immune cells
“monocyte” a type of white blood cell (leukocytes) that reside in
blood and tissues to find and destroy germs and eliminate
infected cells
“monotherapy” therapy that uses a single drug to treat a disease or
condition
“MSI-H/dMMR” microsatellite instability-high or mismatch repair
deficient, biomarkers of tumors that have an
accumulation of errors in sequences that are normally
repeated
“MTD” maximum tolerated dose, the highest dose of a drug or
treatment that does not cause unacceptable side effects
“NHL” non-Hodgkin lymphoma
“NK cell(s)“ natural killer cells, a type of cytotoxic lymphocyte, which
provides rapid responses to virus-infected cell and other
intracellular pathogens, and respond to tumor formation
GLOSSARY OF TECHNICAL TERMS
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“NKG2A” inhibitory NK cell receptor
“NK/T” a sub-type of Epstein–Barr virus (EBV)-related non-
Hodgkin lymphomas
“NSCLC” non-small cell lung cancer
“OC” ovarian cancer
“ORR” overall response rate
“OX40” a receptor expressed on activated T cells which gives
costimulatory signals to promote T cell division and
survival
“OX40L” ligand for OX40 and is stably expressed on many
antigen-presenting cells
“PBMC” peripheral blood mononuclear cell
“PC” pancreatic cancer
“PCC” preclinical candidate compounds
“PD-1” programmed cell death protein 1, an immune checkpoint
receptor expressed on T cells, B cells and macrophages.
The normal function of PD-1 is to turn off the T cell
mediated immune response as part of the process that
stops a healthy immune system from attacking other
pathogenic cells in the body. When PD-1 on the surface
of a T cell attaches to certain proteins on the surface of a
normal cell or a cancer cell, the T cell turns off its ability
to kill the cell
“PD-L1” PD-1 ligand 1, which is a protein on the surface of a
normal cell or a cancer cell that binds to its receptor, PD
-1, on the surface of the T cell that causes the T cell to
turn off its ability to kill the cancer cell
“PD-L2” PD-1 ligand 2, a cell surface protein expressed by
activated macrophages and dendritic cells that binds
PD-1 on T cells to inhibit immune responses
GLOSSARY OF TECHNICAL TERMS
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“Phase I clinical trial” study in which a drug is introduced into healthy human
subjects or patients with the target disease or condition
and tested for safety, dosage tolerance, absorption,
metabolism, distribution, excretion, and if possible, to
gain an early indication of its effectiveness
“Phase II clinical trial” study in which a drug is administered to a limited patient
population to identify possible adverse effects and safety
risks, to preliminarily evaluate the efficacy of the product
for specific targeted diseases, and to determine dosage
tolerance and optimal dosage
“Phase III clinical trial” study in which a drug is administered to an expanded
patient population generally at geographically dispersed
clinical trial sites, in well-controlled clinical trials to
generate enough data to statistically evaluate the efficacy
and safety of the product for approval, to provide
adequate information for the labeling of the product
“PK” the activity of drugs in the body over a period of time,
including the processes by which drugs are absorbed,
distributed in the body, metabolized and excreted
“polymorphism” the ability of a drug substance to crystallize into more
than two different forms
“PR” partial response, refers to an at least 30% but below 100%
decrease in the size of a tumor or in the extent of cancer
in the body in response to treatment, according to
RECIST
“preclinical study” studies or programs testing a therapeutic in vitro or in
vivo under laboratory condition, to gather efficacy,
toxicity, pharmacokinetic and safety information and to
decide whether the drug is ready for clinical trials
“radiotherapy” a type of cancer treatment that uses beams of intense
energy to kill cancer cells
“RCC” renal cell carcinoma
GLOSSARY OF TECHNICAL TERMS
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“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
“RECIST” Response Evaluation Criteria in Solid Tumors, a set of
published rules as a standard way to measure how well a
cancer patient responds to treatment. It is based on
whether tumors shrink, stay the same, or get bigger. The
criteria were published in February 2000 by an
international collaboration including the European
Organisation for Research and Treatment of Cancer,
National Cancer Institute of the United States, and the
National Cancer Institute of Canada Clinical Trials
Group. Now the majority of clinical trials evaluating
cancer treatments for objective response in solid tumors
use RECIST. These criteria were developed and
published in February 2000, and subsequently updated in
2009
“recombinant” the combination of genetic materials from more than one
origin, or a method to express native proteins in vitro by
genetic engineering
“refractory” when used in reference to any type of cancer, cancer that
does not respond to treatment. The cancer may be
resistant at the beginning of treatment or it may become
resistant during treatment
“relapsed” when used in reference to any disease, including cancer,
the return of a disease or the signs and symptoms of a
disease after a period of improvement. With respect to
cancer, the likely relapse occurs because a few of the
original cancer cells survived the initial treatment.
Sometimes, this is because cancer cells spread to other
parts of the body and were too small to be detected during
the follow-up immediately after treatment
“RP2D” recommended Phase II dose
“R/R” relapsed/refractory
“SCLC” small-cell lung cancer
GLOSSARY OF TECHNICAL TERMS
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“SD” stable disease. In oncology, it refers to cancer that is
neither decreasing at least 30% nor increasing at least
20% in the size of a tumor or in the extent of cancer in the
body in response to treatment, according to RECIST
“signaling” the ability of a cell to receive, process and transmit
signals with its environment and with itself
“SIRP/H9251” signal regulatory protein /H9251, a regulatory membrane
glycoprotein, which serves as an inhibitory receptor and
interacts with CD47, negatively controlling effector
function of innate immune cells such as phagocytosis
“solid tumor” an abnormal mass of tissue that usually does not contain
cysts or liquid areas. Solid tumors may be benign (not
cancer), or malignant (cancer). Different types of solid
tumors are named for the type of cells that form them
“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
“STS” soft tissue sarcomas
“T cell(s)” or “T lymphocyte(s)” a lymphocyte of a type produced or processed by the
thymus gland and actively participating in the immune
response, which plays a central role in cell-mediated
immunity
“TAA” tumor-associated antigens, which derive from any protein
or glycoprotein synthesized by the tumor cell
“TEAE(s)” treatment emergent adverse event(s)
“Teff” or “Teff cell(s)” effector T cell
“TIGIT” T-cell immunoreceptor with immunoglobulin and
immunoreceptor tyrosine-based inhibition motif domain
“TNBC” triple-negative breast cancer
“TNFR” tumor necrosis factor receptor
“T-L/L” T-cell leukemia and lymphoma
GLOSSARY OF TECHNICAL TERMS
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“toxicity” the degree to which a substance or a mixture of
substances can harm humans or animals. It is expressed
generally as a dose response
“translational medicine” research that transforms scientific discoveries arising
from laboratory, clinical or population studies into new
clinical tools and applications that improve human health
by reducing disease incidence, morbidity and mortality
“TRBV” TCR /H9252chain variant region
“Treg” or “Treg cell(s)” regulatory T cells
“tumor infiltrating” the movement of cells from the blood into a tumor
“UC” urothelial cancer
“VEGF” vascular endothelial growth factor, a family of signaling
protein critical for the growth of the new vessels and
thereby development of cancer cells. VEGF binds to
VEGF receptors (VEGFR), which exist as three main
subtypes, including VEGFR-1, VEGFR-2 and VEGFR-3
GLOSSARY OF TECHNICAL TERMS
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This prospectus contains forward-looking statements that relate to our current
expectations and views of future events. These forward-looking statements are contained
principally in “Summary”, “Risk Factors”, “Industry Overview”, “Business”, “Financial
Information”, and “Future Plans and Use of Proceeds”. Y ou are strongly cautioned that these
statements relate to events that involve known and unknown risks, uncertainties and other
factors, including those listed in “Risk Factors”, which may cause our actual results,
performance or achievements to be materially different from any future results, performance or
achievements expressed or implied by the forward-looking statements.
In some cases, these forward-looking statements can be identified by words or phrases
such as “aim”, “anticipate”, “believe”, “could”, “expect”, “going forward”, “intend”, “may”,
“might”, “ought to”, “plan”, “potential”, “predict”, “project”, “seek”, “should”, “will”,
“would” and the negative of these words and other similar expressions. These forward-looking
statements include, among other things, statements relating to:
 our operations and business prospects;
 our financial condition and performance;
 our future debt levels and capital expenditure plan;
 our ability to complete the development and obtain the relevant requisite regulatory
approvals of our drug candidates;
 our ability to commercialize our approved products in a timely manner;
 future developments, trends and conditions in the industries and market in which we
operate or plan to operate;
 general economic, political and business conditions in the markets in which we
operate;
 changes to the political and regulatory environment in the industries and markets in
which we operate;
 the actions and developments of our competitors;
 the ability of third parties to perform in accordance with contractual terms and
specifications;
 our ability to retain senior management and key personnel and recruit qualified staff;
 our business strategies and plans to achieve these strategies;
 our ability to defend our intellectual rights and protect confidentiality;
FORW ARD-LOOKING STATEMENTS
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 the effectiveness of our quality control systems;
 change or volatility in interest rates, foreign exchange rates, equity prices, trading
volumes, commodity prices and overall market trends, including those pertaining to
the PRC and the industry and markets in which we operate;
 capital market developments; and
 changes on the fair valuation of our assets.
These forward-looking statements are subject to risks, uncertainties and assumptions,
some of which are beyond our control. In addition, these forward-looking statements reflect
our current views with respect to future events and are not a guarantee of future performance.
Actual outcomes may differ materially from the information contained in the forward-looking
statements as a result of a number of factors, including, without limitation, the risk factors set
forth in “Risk Factors”.
The forward-looking statements made in this prospectus relate only to events or
information as of the date on which the statements are made in this prospectus. Except as
required by law, we undertake no obligation to update or revise publicly any forward-looking
statements, whether as a result of new information, future events or otherwise, after the date
on which the statements are made or to reflect the occurrence of unanticipated events. Y ou
should read this prospectus completely and with the understanding that our actual future results
or performance may be materially different from what we expect.
In this prospectus, statements of, or references to, our intentions or those of any of our
Directors are made as of the date of this prospectus. Any of these intentions may change in light
of future development.
FORW ARD-LOOKING STATEMENTS
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An investment in our Shares involves significant risks. You should carefully consider
all of the information in this prospectus, including the risks and uncertainties described
below, before making an investment in our Shares. Particularly, we are a biotech
company seeking to list on the Main Board of the Stock Exchange under Chapter 18A of
the Listing Rules. Our operations and the industry in which we operate involve certain
risks and uncertainties, some of which are beyond our control and may cause you to lose
all your investment in our Shares. The following is a description of what we consider to
be our material risks. Any of the following risks could have a material adverse effect on
our business, financial condition and results of operations and prospects. In any such
case, the market price of our Shares could decline, and you may lose all or part of your
investment.
These factors are contingencies that may or may not occur , and we are not in a
position to express a view on the likelihood of any such contingency occurring. The
information given is as of the Latest Practicable Date unless otherwise stated, will not
be updated after the date hereof, and is subject to the cautionary statements in the section
headed “Forward-looking Statements” in this prospectus. You should seek professional
advice from your relevant advisers regarding your prospective investment in the context
of your particular circumstances.
RISKS RELATING TO THE RESEARCH AND DEVELOPMENT OF OUR DRUG
CANDIDATES
Our business and financial prospects depend substantially on the success of our drug
candidates. If we are unable to successfully complete clinical development, obtain
regulatory approvals or achieve commercialization for our drug candidates, or if we
experience significant delays or cost overruns in doing any of the foregoing, our business
and prospects could be materially and adversely affected.
We have invested a significant portion of our efforts and capital resources in the
development of our existing drug candidates, and we expect to incur substantial and increasing
expenditures for the development and commercialization of our drug candidates in the future.
The success of our drug candidates will depend on a number of factors, including but not
limited to: (i) favorable safety and efficacy data from our preclinical studies and clinical trials;
(ii) sufficient resources to discover or acquire additional drug candidates and successful
identification of potential drug candidates based on our research or business development
methodology or search criteria and process; (iii) successful enrollment of subjects in, and
completion of, clinical trials; (iv) modifications to the protocols, which may delay the clinical
program, regulatory approvals or commercialization, and require us to supplement, modify, or
withdraw and refile our applications for regulatory approvals; (v) the performance by CROs or
other third parties we engage to conduct clinical trials and preclinical studies and their
compliance with our protocols and applicable laws without damaging or compromising the
RISK FACTORS
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integrity of the resulting data; (vi) the capabilities and competence of our collaborators; (vii)
the success of our clinical trials; (viii) receipt of regulatory approvals; (ix) the obtaining,
maintenance and enforcement of patents, trademarks, trade secrets and other intellectual
property protections and regulatory exclusivity for our drug candidates; (x) competitive
advantages of our drug candidates; and (xi) the continued acceptable safety profile of our drug
candidates following regulatory approval.
Our drug candidates were developed to represent a novel approach to address therapeutic
needs compared to more commonly used medical methods, which inherently carries
development risks that could result in delays and cost overruns in clinical development,
regulatory approvals or commercialization. In addition, potential patients and their doctors
may be inclined to use conventional standard-of-care treatments over any novel approach.
Furthermore, a substantial amount of education and training may need to be provided to
patients and medical personnel, which potentially increases our sales and marketing expenses.
As of the Latest Practicable Date, our drug candidates were in various phases of
pre-clinical and clinical development, and we plan to file the NDA applications for our drug
candidates with the FDA or NMPA in the next five years. If we encounter any challenges
arising from one or more of the aforementioned factors, we could experience significant delays
or difficulties in obtaining approvals for and commercializing our drug candidates, which
would have a material adverse effect on our competitive position, business, financial condition
and results of operations.
We may face intense competition and rapid technological change in our industry,
particularly for our Core Product HX009 and the possibility that our competitors may
develop therapies that are similar, or even more advanced and, effective than ours, which
may adversely affect our financial condition and our ability to successfully commercialize
our drug candidates.
The biopharmaceutical industry in which we operate is highly competitive and rapidly
changing. While we focus on developing drug candidates with the potential to become novel
or highly differentiated drugs, we face competition with respect to our current drug candidates
and will face competition with respect to any drug candidates that we may seek to develop or
commercialize in the future. For example, in recent years, an increasing number of
biopharmaceutical companies have joined the competition in the research and development of
immunology-oncology therapies for cancer, with large pharmaceutical companies leading the
competition and small biopharmaceutical companies making frequent breakthroughs. Some of
these competitive drugs and therapies are based on scientific approaches that are the same as
or similar to our approach, and others are based on different approaches.
The increasing regulatory scrutiny on the market approval and keen market competition
of HX009 in view of the increasing number and patient response on and performance of
approved products such as PD-1/PD-L1 inhibitors in the market and the risks of unsuccessful
clinical trial development and safety concerns on HX009 and its class of drug (e.g. safety
concerns with respect to CD47 targeted molecules). We may face more competition for our
RISK FACTORS
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Core Product HX009, as multiple clinical trials of PD-1/PD-L1 mAbs are conducted for the
first-line treatment of cancer at present and competitors are making efforts to advance from
third-line or second-line to first-line therapy and continue to expand to consolidation therapy
for locally advanced cancer and neo-adjuvant therapy for early or mid-stage cancer. Therefore,
more PD-1/PD-L1 mAbs are expected to be approved for first-line treatment of cancer in the
near future, increasing competition level for HX009.
Even if our drug candidates had been successfully developed and subsequently approved
by the NMPA, the FDA or other comparable regulatory authorities, our drug candidates may
still face competition in various aspects, including safety and efficacy, the timing and scope of
the regulatory approvals, the availability and cost of supply, sales and marketing capabilities,
price and patent status. Many of our competitors may have substantially greater financial,
technical and other resources, such as more advanced commercial infrastructure, more drug
candidates in late-stage clinical development, more seasoned research and development staff
and well-established marketing teams than us. Our competitors may succeed in developing
competing drugs and obtaining regulatory approvals before us or achieve better acceptance in
the markets in which we operate or have established a competitive position.
Competition may further intensify as a result of advances in the commercial applicability
of technologies and availability of capital for investment in the industry. Our competitors may
succeed in developing, acquiring, or licensing on an exclusive basis, products that are more
effective with a lower cost than our drug candidates, or achieve earlier patent protection,
regulatory approvals, product commercialization and market penetration than we do.
We may not be able to identify, discover, acquire, in-license or develop new drug
candidates, or to identify additional therapeutic opportunities for our drug candidates.
Besides the continued development of our existing drug candidates, the success of our
business depends in part upon our ability to expand our drug portfolio with new drug
candidates, especially white space opportunities in therapeutic areas with significant unmet
medical needs and innovation gaps.
There can be no assurance that we will be successful in discovering and identifying new
drug candidates in the future. Even if we succeed in identifying new drug candidates, some
may present significant technical challenges during development. Drug candidates that we
identify may later show side effects or other attributes that make them unmarketable or
unlikely to receive regulatory approvals. We may also pursue collaboration with third parties
in the discovery and development of potential drug candidates, including through co-
development and licensing arrangements. However, we cannot assure you that such license and
collaboration will be able to deliver the expected results.
RISK FACTORS
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Our Core Product HX009 is a bifunctional anti-PD-1 antibody SIRP /H9251fusion protein.
Despite that dual-targeted drugs have vast therapeutic potential, they also need to contend with
safety risks, development challenges, drug resistance and the complexity of target selection.
These risks need to be carefully evaluated when developing and using dual-targeted drugs, and
adequate clinical and scientific studies need to be conducted to ensure their safety and efficacy.
Clinical development involves a lengthy and expensive process with uncertain outcomes,
and results of earlier studies and trials may not be predictive of future trial results.
To obtain regulatory approval for the sale of our drug candidates, we are required to
conduct extensive clinical trials to demonstrate the safety and efficacy of our drug candidates
in human. Clinical trials are expensive, difficult to design and implement, with clinical
outcomes subject to high uncertainty. We may encounter unexpected difficulties while
executing our clinical development plans for our drug candidates. Failure can occur at any time
or stage during the clinical development process, which would result in a material and adverse
effect on our business, financial condition and results of operations.
Furthermore, the results of preclinical studies and early-stage clinical trials may not be
predictive of the success of later-phase clinical trials, and favorable initial or interim results of
a clinical trial do not necessarily indicate the success of final results. Drug candidates in
advanced clinical trials may fail to show the desired safety and efficacy profile despite having
progressed through preclinical studies and initial clinical trials.
There may be significant variability in safety or efficacy results among different trials of
the same drug candidate due to numerous factors, including changes in trial procedures set
forth in protocols, differences in size and demographics of the enrolled patients (such as
genetic differences and patient adherence to the dosage regimen) and the dropout rate among
enrolled patients in clinical trials. Differences in the number of clinical trial sites and countries
involved may also lead to variability between clinical trials. We might suspend or terminate
clinical trials of our drug candidates for various reasons, including change in our clinical
development strategy. Therefore, the results of planned clinical trials or other future clinical
trials could differ significantly from our expectation, which could result in delays in the
completion of clinical trials, regulatory approvals and commencement of commercialization of
our drug candidates.
If safety, efficacy, or other issues arise with any medical product used in combination with
our drug candidates, we may be unable to market such drug candidate or may experience
significant regulatory delays.
Our strategy to develop combination therapies depends on the safety and efficacy of each
component drug within each combination therapy. If the NMPA, U.S. FDA, EMA or another
comparable regulatory agency revokes or denies its approval of a component therapeutic, in
either the clinical design, clinical administration, therapy approval or commercialization stage,
we will be forced to terminate or redesign the clinical trials, experience significant regulatory
delays or stop our commercialization efforts. In addition, if manufacturing or other issues
RISK FACTORS
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result in a supply shortage of any component of our combination drug candidates or if we
cannot secure supply of any component of our drug candidates at commercially reasonable or
acceptable prices, we may not be able to complete clinical development of our drug candidates
on our current timeline or within our current budget, or at all.
We may invest substantial resources in research and development of drug candidates,
allocate our limited resources to pursue a particular drug candidate or indication and fail
to capitalize on drug candidates or indications that may later prove to be more profitable
or for which there is a greater likelihood of success.
The global biopharmaceutical market is constantly evolving, and the development of
drugs faces many risks and challenges. In contrast to generic drugs, drugs emphasize novel
mechanisms of actions, and discovering new molecular is challenging due to complex
technological obstacles and limitations in R&D capabilities. We must continue to invest
significant amounts of human and capital resources to develop or acquire technologies that will
allow us to enhance our research and development capabilities. We intend to continue to
enhance our technical capabilities in drug discovery and development, which are capital-and-
time intensive.
Furthermore, as we have limited financial and managerial resources, we manage
development risks and allocate our resources in accordance with different development
timelines of our drug candidates for selected indications. As a result, we may forgo or delay
pursuit of opportunities with other drug candidates or for other indications that may later prove
to have greater commercial potential or a greater likelihood of success. Accordingly, our
resource allocation decisions may cause us to fail to capitalize on other viable commercial
products or profitable market opportunities. If we cannot accurately evaluate the commercial
potential or target market for a particular drug candidate, we may lose the chances to timely
commercialize such drug candidates and our prospects may be adversely affected.
If we encounter difficulties enrolling patients in our clinical trials, our clinical
development activities could be delayed or otherwise adversely affected.
The timely completion of clinical trials in accordance with their protocols depends,
among other things, on our ability to enroll a sufficient number of subjects who timely
completed the clinical trials. We may experience difficulties in subject enrollment in our
clinical trials for a variety of reasons, including but not limited to: (i) our ability to recruit
clinical trial investigators with the appropriate competencies and experience; (ii) clinicians’
and patients’ perceptions of the potential advantages and side effects of the drug candidate
being studied compared to other available therapies, including any new drugs or treatments that
may be approved for the indications we are investigating; (iii) our ability to obtain and
maintain subject consents; (iv) the risk that subjects enrolled in clinical trials will drop out; and
(v) the availability of approved therapies that are similar in mechanism to our drug candidates.
RISK FACTORS
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In addition, our clinical trials may compete with our competitors’ clinical trials for drug
candidates that are in the same therapeutic areas as our drug candidates. Such competition will
likely reduce the number and types of subjects available to us, as some patients might opt to
enroll in a trial conducted by our competitors instead. Even if we manage and become able to
enroll a sufficient number of subjects in our clinical trials, delays in subject enrollment may
result in increased costs or may affect the timing or outcome of the planned clinical trials,
which could delay or prevent the completion of these trials and adversely affect our ability to
advance the development of our drug candidates.
Adverse events or undesirable side effects caused by our drug candidates could interrupt,
delay or halt clinical trials, delay or prevent regulatory approval, limit the commercial
profile of an approved drug, or result in significant negative consequences following any
regulatory approval.
Adverse events and undesirable side effects caused by our drug candidates could cause us
or regulatory authorities to interrupt, delay or halt clinical trials and may result in a narrowed
scope of indications or a more restrictive label of our drug candidates, a delay or denial of
regulatory approval by the NMPA, the FDA or other comparable regulatory authorities, or a
significant change in our clinical protocol or even our development plan. Adverse events
related to our drug candidates may also affect subject recruitment or the ability of enrolled
subjects to complete the trial, and could result in potential liability claims. In addition, if our
drug candidates cause injury or death or are found to be otherwise unsuitable, our reputation
may be damaged and we may face substantial liabilities related to product or other liability
claims. For example, safety issues have been documented in literatures that the primary
concerns around CD47. Other than tumor cells, CD47 is also ubiquitously expressed on human
red blood cells and platelets. CD47-targeted agents are shown to cause blood toxicity in
clinical trials, such as anemia, thrombocytopenia and hemagglutination. In fact, a number of
clinical-stage CD47 antibodies show severe strong red blood cell binding, leading to severe
adverse effects, and trial suspensions or termination. Any of these occurrences may
significantly harm our reputation, business, financial condition and prospects.
Furthermore, if we identify undesirable side effects caused by our drug candidates after
they receive regulatory approval, this may lead to potentially significant negative
consequences which include, but are not limited to: (i) regulatory authorities may withdraw
their approvals of or revoke the licenses for the drug candidate; (ii) regulatory authorities may
order us to cease further development of, or delay or even deny approval of, our drug
candidates for any or all targeted indications if results of our trials reveal a high and
unacceptable severity or prevalence of certain adverse events; and (iii) regulatory authorities
may withdraw approvals or revoke licenses of an approved drug candidate, or we may
determine to do so even if not required. Furthermore, if it is assessed that our candidate drug
has led to serious safety events such as rapid disease progression or death, we may be required
to conduct more comprehensive risk assessment, and may also face the termination of the
clinical study (either terminated by the sponsor itself or required by regulatory authorities).
Even if such candidate drug is launched on the market in the future, regulatory authorities may
require the addition of a black box warning in its instructions.
RISK FACTORS
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Any of these events could prevent us from achieving or maintaining market acceptance
of any particular drug candidate that is approved and could significantly harm our business,
financial condition, results of operations and prospects.
RISKS RELATING TO OUR FINANCIAL POSITION AND NEED FOR ADDITIONAL
CAPITAL
We have incurred significant net losses since inception. We anticipate that we will
continue to incur net losses and may fail to achieve or maintain profitability in the
foreseeable future.
During the Track Record Period, we financed our operations primarily through funds from
transfer of our equity interests in Taizhou Hanzhong and Pre-IPO Investments and bank
borrowings. We had incurred and will continue to incur significant expenditure related to the
R&D activities and clinical studies of drug candidates, which gives rise to our significant
comprehensive losses since our inception. For the years ended December 31, 2023 and 2024
and the eight months ended August 31, 2024 and 2025, our total comprehensive losses were
RMB84.6 million, RMB116.9 million, RMB48.2 million and RMB87.9 million, respectively.
For details, please refer to “Financial Information — Description of Selected Components of
Consolidated Statements of Profit or Loss and Other Comprehensive Income”.
Substantial portion of our net losses during the Track Record Period resulted from costs
and expenses incurred by our R&D activities, including those in relation to our preclinical
studies and clinical trials. For the years ended December 31, 2023 and 2024 and the eight
months ended August 31, 2024 and 2025, our research and development costs were RMB46.7
million, RMB74.7 million, RMB50.5 million and RMB56.2 million, respectively. For details,
please refer to “Financial Information — Description of Selected Components of Consolidated
Statements of Profit or Loss and Other Comprehensive Income — Research and Development
Costs”. Our ability to generate revenue and achieve profitability depends significantly on our
success in advancing drug candidates into later stages of clinical development, and obtaining
regulatory approvals for each drug candidate, which we may not be able to do in a timely
manner or at all.
We expect to continue to incur net losses in the foreseeable future and that these net losses
may increase as we carry out certain activities, including but not limited to: (i) address any
technological developments; (ii) develop, maintain, expand and protect our intellectual
property portfolio; (iii) attract and retain skilled personnel; (iv) enforce and defend any
intellectual property claims; and (v) incur additional legal, accounting, investor relations,
insurance and other expenses associated with operating as a public company following the
completion of this Offering.
Even if we achieve profitability in the future, we may not be able to sustain that
profitability in subsequent periods. Our net losses have had, and will continue to have, an
adverse effect on our working capital and Shareholders’ equity. Our failure to become and
remain profitable may affect investors’ perception of the potential value of our Company and
RISK FACTORS
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could impair our ability to raise additional capital, expand our business or continue our
operations. Failure to become profitable may also adversely affect the market price of our
Shares. A decline in the market price of our Shares could cause potential investors to lose all
or part of their investment in our business.
We have incurred during the Track Record Period and may continue to incur net
operating cash outflows, which may expose us to liquidity risk.
We had net cash flow used in operating activities of RMB52.0 million, RMB104.9
million, RMB67.9 million and RMB59.4 million for the year ended December 31, 2023 and
2024 and the eight months ended August 31, 2024 and 2025, respectively. We may experience
net cash outflows from our operating activities from time to time. For details, please refer to
“Financial Information — Liquidity and Capital Resources — Net Cash Flows Used in
Operating Activities” in this prospectus. Our forecast of the period of time through which our
capital resources will be adequate to support our operations is a forward-looking statement and
involves risks and uncertainties. We have based this estimate on assumptions that may prove
to be wrong, and we could exhaust our available capital resources sooner than we currently
expect. If we are unable to maintain adequate working capital or obtain sufficient financings
to meet our capital needs, we may be unable to continue our operations according to our plan,
default on our payment obligations and fail to meet our capital expenditure requirements,
which may have a material adverse effect on our business, financial condition, results of
operations and prospects.
We recorded net current liabilities as of August 31, 2025.
We recorded net current liabilities of RMB15.2 million as of August 31, 2025, which was
primarily due to the redemption liabilities on ordinary shares with an amount of RMB138.5
million were recorded as current liabilities, and the redemption feature of which will
automatically ceased from the date before the completion of the Listing. Net current liabilities
position can expose us to the risk of shortfalls in liquidity. This in turn would require us to seek
adequate financing from sources. If we are unable to maintain adequate working capital or
obtain sufficient equity or debt financing to meet our capital needs, we may be unable to
continue our operations according to our plans and be forced to scale back our operations,
which may have a material adverse effect on our business, financial condition, results of
operations and prospects.
We may need to obtain substantial additional financing to fund our operations and
expansion, and if we are unable to obtain sufficient financing, we may be unable to
complete the development of our drug candidates.
During the Track Record Period, we financed our operations, including our R&D
activities in relation to our preclinical studies and clinical trials, primarily through funds from
transfer of our equity interests in Taizhou Hanzhong and Pre-IPO Investments and bank
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borrowings. Our drug candidates require substantial investments for the completion of clinical
development, regulatory review, drug manufacturing, marketing and launch before they can
generate product sales revenue. Our operations have consumed substantial amounts of cash
since our inception.
We expect to fund our future operations primarily with existing cash and cash equivalents,
funds from transfer of our equity interests in Taizhou Hanzhong and potential future financing,
and net proceeds from the Global Offering. Changes in our ability to fund our operations may
affect our cash flow and results of operations. Although we are conducting this Global
Offering, we may nevertheless require substantial additional capital to meet our continued
operating cash requirements, especially to fund our R&D and clinical trial activities of our drug
candidates.
Our ability to raise funds will also depend on the prevailing financial, economic and
market conditions and factors from other aspects, such as our relationship with commercial
banks, many of which are beyond our control. If adequate funds are not available to us on a
timely basis, we may be required to delay, limit, reduce or terminate preclinical studies, clinical
trials or other research and development activities, or the commercialization of one or more of
our drug candidates, which may adversely affect our business prospects.
Our results of operations, financial condition, and prospects may be adversely affected by
fair value changes and credit risk associated with our financial assets at fair value
through profit or loss.
Our financial assets at fair value through profit or loss primarily included variable
consideration arising from disposal of an associate and valuation uncertainty due to the use of
unobservable inputs, and structured deposits and wealth management products. During the
Track Record Period, our non-current financial assets at fair value through profit or loss
maintained relatively stable with the amount of RMB242.4 million, RMB233.8 million and
RMB210.1 million as at December 31, 2023, and 2024 and August 31, 2025, respectively. Our
current financial assets at fair value through profit or loss were RMB42.4 million, RMB12.7
million and RMB22.8 million as at the same dates. We are exposed to risks in relation to the
financial assets, which may adversely affect our net changes in their fair value. The financial
assets at fair value through profit or loss are stated at fair value, and net changes in their fair
value are recorded as other income and gains, and therefore directly affect our results of
operations. The fair value of financial assets at fair value through profit or loss relies on the
sales performance of HX008, which is subject to uncertainty and is out of our control. We
cannot assure you that market conditions and regulatory environment will create fair value
gains and we will not incur any fair value losses on our financial assets at fair value through
profit or loss in the future. If we incur such fair value losses, our results of operations, financial
condition and prospects may be adversely affected.
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Fluctuations in exchange rates could result in foreign currency exchanges losses.
The value of RMB against the Hong Kong dollar, the U.S. dollar and other currencies
fluctuates depends to a large extent on domestic and international economic and political
developments as well as supply and demand in the local market. It is difficult to predict how
market forces may impact the exchange rate between the RMB and the Hong Kong dollar, the
U.S. dollar or other currencies in the future.
Any appreciation of the RMB against the Hong Kong dollar may result in the decrease in
the value of our proceeds from the Global Offering. Conversely, any depreciation of the RMB
against foreign currencies may adversely affect the value of, and any dividends payable on, the
Shares. In addition, there are limited instruments available for us to reduce our foreign
currency risk exposure at reasonable costs. All of these factors could materially and adversely
affect our business, financial condition, results of operations and prospects, and could reduce
the value of, and dividends payable on, the Shares in foreign currency terms.
We benefit from certain government grants, the changes to which could adversely affect
our profitability.
We recorded government grants (including tax refunds) of RMB2.5 million, RMB2.2
million, RMB0.2 million and RMB0.1 million for the years ended December 31, 2023 and 2024
and the eight months ended August 31, 2024 and 2025, respectively. These government grants
are provided to us at the discretion of the relevant government authorities, who could determine
at any time to eliminate or reduce these financial incentives, and may therefore vary from
period to period going forward. For details, please refer to “Financial Information —
Description of Selected Components of Consolidated Statements of Profit or Loss And Other
Comprehensive Income — Other Income and Gains” in this prospectus.
Since our receipt of the government grants is subject to the government’s discretion and
approval process, our income and gains in a particular period may be higher or lower relative
to other periods partly due to the potential changes in the government grants we actually
receive, in addition to any business or operational factors that we may otherwise experience.
There is no assurance that we will continue to receive such government grants at a similar level
or at all in the future. The discontinuation of government grants and other financial incentives
currently available to us could have an adverse effect on our financial condition, results of
operations, cash flows and prospects.
Share-based payments may impact our financial performance and cause shareholding
dilution to our existing Shareholders.
We adopted the Stock Option Incentive Plan and the Restricted Share Incentive Scheme
to ascertain the contribution made by our employees to our Group, incentivize our Group’s
management and key employees to enhance the competitiveness of our Group to ensure
realization of our Group’s future development strategy and business targets. For details, please
refer to “Statutory and General Information — Employee Share Incentive Scheme” in
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Appendix VI to this prospectus. For the years ended December 31, 2023 and 2024 and the eight
months ended August 31, 2025, we recorded share-based payments of RMB15.5 million,
RMB22.3 million and RMB16.0 million, respectively. To further incentivize our management
and key employees, 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.
RISKS RELATING TO GOVERNMENT REGULATIONS
All material aspects of the research, development and commercialization of our drug
candidates are heavily regulated and such regulations are subject to change which may
affect clinical development, approval and commercialization of our drugs. Any failure to
comply with relevant laws and regulations and industry standards or any adverse actions
by the regulatory authorities against us could negatively impact our reputation and our
business, financial condition, results of operations and prospects.
All jurisdictions in which we intend to develop and commercialize our drug candidates
regulate these activities in great depth and detail. Apart from our focus on the China market,
we are actively seeking and screening viable opportunities for drug development and
commercialization in the global market. For more details, please see “Business — Our
Strategies.” Such jurisdictions all strictly regulate the biopharmaceutical 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 us that plans to operate in these
regions.
In recent years, the regulatory framework regarding the biopharmaceutical industry in
China has undergone significant transformation, and it may continue evolving. Any such
changes or amendments may result in increased compliance costs on our business or cause
delays in, or prevent the successful development or commercialization of, our drug candidates
and reduce the current benefits we believe are available to us from developing drugs. The
process of obtaining regulatory approvals and maintaining compliance with appropriate laws
and regulations requires the expenditure of substantial time and capital resources. Failure to
comply with the applicable regulatory requirements in the jurisdictions where we operate or
target to operate in the future at any time during the drug development process or approval
process, or after approval, may subject us to disputes, administrative sanctions, criminal
sanctions and other legal proceedings. These sanctions could include but are not limited to a
regulator’s refusal to approve pending applications, withdrawal of an approval, license
revocation, a clinical hold, voluntary or mandatory product recalls, product seizures, total or
partial suspension of production or distribution, injunctions, fines, refusals of government
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contracts, restitution, disgorgement or civil or criminal penalties. Any occurrence of the
foregoing could therefore materially adversely affect our reputation and our business, financial
condition, results of operations and prospects.
The regulatory approval processes of the NMPA, the FDA and other comparable
regulatory authorities are lengthy, time-consuming and unpredictable. If we are unable to
obtain without undue delay of any regulatory approvals for our drug candidates in our
targeted markets, our business may be subject to actual or perceived harm.
The time required to obtain approvals from the NMPA, the FDA, and other comparable
regulatory authorities is often unpredictable and depends on numerous factors, including the
substantial discretion of the regulatory authorities. Generally, such approvals take many years
to obtain, following the commencement of preclinical studies and clinical trials. We cannot
assure you that we will be able to meet regulatory requirements of different jurisdictions or that
our drug candidates will be approved for sale in those jurisdictions. Additional time, effort and
expense may be required to bring our drug candidates, upon regulatory approval, to the
international markets in compliance with different regulatory processes.
The NMPA, the FDA or other comparable regulatory authorities may require more
information to support approval, including additional preclinical or clinical data, which may
result in delay or prevent regulatory approval and commercialization plans. In the case where
an approval is issued, regulatory authorities may approve fewer indications, including
undesired indications, of our drug candidates than the indications we applied for, or grant
approvals contingent on the performance of post-marketing clinical trials. Failure to obtain
regulatory approvals in a timely manner, or at all, or failure to obtain regulatory approvals with
an intended scope of indications could have a negative impact on the commercial prospects of
our drug candidates, and may cause reputational damage. If any of our drug candidates fails to
demonstrate safety and efficacy to the satisfaction of regulatory authorities or does not
otherwise produce positive results in future clinical trials, we would not be able to realize any
revenue on such drug candidate despite the significant amount of resources we would have
spent on its development, which could materially adversely affect our business, financial
condition, results of operations and prospects.
Our future approved drug candidates will be subject to ongoing or additional regulatory
obligations and continued regulatory review, which may result in significant additional
expenses. We may face penalties and other negative consequences if we fail to comply with
these regulatory requirements or experience unanticipated problems with our drug
candidates.
Any regulatory approvals that we receive for our drug candidates may also be subject to
limitations on the approved indicated uses for which the drug may be marketed or to the
conditions of approval, or contain requirements for potentially costly testing and surveillance
to monitor the safety and efficacy of the drug candidates. The NMPA, FDA or a comparable
regulatory authority may also require a REMS program as a condition of approval of our drug
candidates or following approval.
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Any government investigation of alleged violations of law could cost us significant time
and resources and could generate negative publicity. Moreover, regulatory policies may change
or additional government regulations may be enacted that could limit or revoke 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 and
prospects.
We face regulation and potential liability related to privacy, data protection and
information security which may require significant resources and may adversely affect
our business, operations and financial performance.
We routinely receive, collect, generate, store, process, transmit and maintain medical
data, treatment records and other personal details of subjects enrolled in our clinical trials,
along with other personal or sensitive information. As such, we are subject to the relevant
local, national and international data protection and privacy laws, directives, regulations and
standards that apply to the collection, use, retention, protection, disclosure, transfer and other
processing of personal data in the various jurisdictions in which we operate and conduct our
clinical trials, as well as contractual obligations. These data protection and privacy law regimes
continue to evolve and may result in ever-increasing public scrutiny and escalating levels of
enforcement and sanctions and increased costs of compliance. Failure to comply with any of
these laws could result in enforcement action against us.
In recent years, the PRC government has promulgated a serious of laws and regulations
governing the various aspects of information security, data collection and privacy protection,
including, among others, the Cybersecurity Law of the PRC ( ʕശɛ͏΍ձ਷ၣഖτΌ
), the Provisions on Protection of Personal Information of Telecommunication and Internet
Users (), the Cybersecurity Review Measures ( ၣ
), the Data Security Law of the PRC ()
which became effective from September 1, 2021, and the Personal Information Protection Law
of the PRC () which became effective from November 1,
2021. Under the Personal Information Protection Law of the PRC, prior consent shall be
obtained from the individual when personal information is being processed, unless explicitly
permitted under certain circumstances.
On March 17, 2018, the General Office of the State Council promulgated the Measures
for the Management of Scientific Data () (the “ Scientific Data
Measures ”), which provides a broad definition of scientific data and relevant rules for the
management of scientific data. According to the Scientific Data Measures, enterprises in China
must seek governmental approval before any scientific data involving a state secret may be
transferred abroad or to foreign parties. Further, any researcher conducting research funded at
least in part by the Chinese government is required to submit relevant scientific data for
management by the entity to which such researcher is affiliated before such data may be
published in any foreign academic journal. We cannot assure you that we can always obtain
relevant approvals for sending scientific data (such as the results of our preclinical studies or
clinical trials conducted within China) abroad or to our foreign partners in China, if any. If we
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are unable to obtain necessary approvals in a timely manner, or at all, our research and
development of drug candidates may be hindered, which may materially and adversely affect
our business, financial condition, results of operations and prospects. If the relevant
government authorities consider the transmission of our scientific data to be in violation of the
requirements under the Scientific Data Measures, we may be subject to fines and other
administrative penalties imposed by those government authorities.
Furthermore, any data processing activities in relation to sensitive personal information
such as biometrics, medical health and personal information of teenagers under fourteen years
old are not allowed unless such activities have a specific purpose, are highly necessary and
strict protective measures have been taken. Certain industry-specific laws and regulations may
also affect the collection and transfer of personal data in China, including Administrative
Regulations on Human Genetic Resources of the People’s Republic of China ( ʕശɛ͏΍ձ
਷ɛᗳ፲ෂ༟๕၍ଣૢԷ), or the HGR Regulations, issued by the State Council.
In October 2020, the SCNPC promulgated the Biosecurity Law of the PRC, which became
effective in April 2021 and was most recently revised in April 2024. The Biosecurity Law of
the PRC () reaffirms the regulatory requirements stipulated by
the HGR Regulation while potentially increasing the administrative sanctions where China’s
human genetic resources are collected, preserved, exported or used in international cooperation
in violation of applicable laws. Although we have made great efforts to comply with mandatory
requirements of laws and government authorities in this regard, we cannot assure you that we
will be deemed at all times in full compliance with the HGR Regulation, the Biosecurity Law
of the PRC and other applicable laws in our utilizing of and dealing with China’s human
genetic resources. As a result, we may be exposed to compliance risks under the HGR
Regulation and the Biosecurity Law of the PRC.
Numerous U.S. federal and state laws and regulations relate to the privacy and security
of personal information. In particular, regulations promulgated pursuant to the Health
Insurance Portability and Accountability Act of 1996, or HIPAA, establish privacy and security
standards that limit the use and disclosure of individually identifiable health information,
known as “protected health information,” and require the implementation of administrative,
physical and technological safeguards to protect the privacy of protected health information
and ensure the confidentiality, integrity and availability of electronic protected health
information. Such data protection and privacy laws and regulations generally require clinical
trial sponsors and operators and their personnel to protect the privacy of their enrolled subjects
and prohibit unauthorized disclosure of personal information. However, these measures may
not be always effective.
Any change in the applicable laws and regulations could affect our ability to use medical
data and subject us to liability for the improper use of such data. Any failure or perceived
failure by us to prevent information security breaches or to comply with privacy policies or
privacy-related legal obligations, or any compromise of information security that results in the
unauthorized release or transfer of personally identifiable information or other patient data,
could cause our customers to lose trust in us and could expose us to legal claims.
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We may be directly or indirectly subject to applicable anti-kickback, false claims laws,
doctor payment transparency laws, fraud and abuse laws or similar healthcare and
security laws and regulations, which could expose us to administrative sanctions, criminal
sanctions, civil penalties, contractual damages, reputational damage 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. Our operations are
subject to various applicable anti-kickback, false claims laws, physician payment transparency
laws, fraud and abuse laws or similar healthcare and security laws and regulations in China and
the U.S.. Such laws include the PRC Anti-Unfair Competition Law ( ʕശɛ͏΍ձ਷ˀʔ͍
), the PRC Criminal Law (), the U.S. federal Anti-
Kickback Statute, the U.S. federal False Claims Act, HIPAA, and the U.S. Physician Payments
Sunshine Act. These laws may impact, among other things, our current and proposed sales and
marketing activities. 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 governments.
Although we have put in place policies and procedures that ensure that we and our
employees comply with fraud and abuse and other healthcare laws and regulations, some of our
practices may be challenged under these laws. Efforts to ensure that our business arrangements
with third parties comply with applicable healthcare laws and regulations will involve
substantial costs. Governmental authorities could 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
if we are not successful in defending ourselves or asserting our rights, those actions could
result in 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 have a significant impact on our businesses and results of operations.
In addition, we are subject to anti-bribery laws in China 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. There is no
assurance that policies or procedures to ensure the compliance with anti-bribery laws will
prevent our agents, 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/or exclusion from participation in government healthcare
programs. As we expand our operations globally/pursue a global strategy and selectively
advance clinical trials and pursue NDAs in other overseas markets, we may also become
subject to similar laws and regulations from other jurisdictions. There are ambiguities as to
what is required to comply with any of these laws and regulations, and if we fail to comply with
such requirements, we could be subject to penalties and other negative consequences. If any of
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the physicians or other third parties with whom we do business are found to be not in
compliance with the applicable laws and regulations, they may be subject to criminal, civil or
administrative sanctions, including exclusions from government funded healthcare programs,
which may also adversely affect our business.
Changes in the political and economic policies, as well as the evolving laws, rules and
regulations, may affect our business, financial condition, results of operations and
prospects.
Since we have extensive operations in the PRC, our business, financial condition, results
of operations and prospects are affected by economic, political and legal developments in the
PRC. The overall economic growth is influenced by the governmental regulations and policies
in relation to resource allocation, monetary policies, regulations of financial services and
institutions, as well as preferential treatment to particular industries or companies. For
example, the Chinese government has implemented various measures to encourage economic
growth and guide the allocation of resources; however, we cannot guarantee the extent to which
our business operations will be able to benefit from such measures, if at all. Laws, rules and
regulations may also be amended from time to time, and the application, interpretation and
enforcement of such evolving laws, rules and regulations may affect our business operations.
Any of the foregoing may affect our business, financial condition, results of operations and
prospects.
The M&A Rules and certain other PRC regulations establish certain procedures for some
acquisitions of Chinese companies by foreign investors, which could make it more difficult
for us to pursue growth through acquisitions in China.
PRC regulations and rules concerning mergers and acquisitions including the Regulations
on Mergers and Acquisitions of Domestic Companies by Foreign Investors (٫
), or the M&A Rules, established additional procedures and
requirements for foreign investors with respect to merger and acquisition activities. Moreover,
the PRC Anti-monopoly Law requires that the anti-trust government authority shall be notified
in advance of any concentration of undertaking if certain thresholds are triggered. Furthermore,
the Provisions of the Ministry of Commerce on the Implementation of the Security Review
System for Merger and Acquisition of Domestic Enterprises by Foreign Investors ( ਠਕ௅ྼ
) issued by the MOFCOM, effective in
September 2011, specifies that a security review is required for mergers and acquisitions by
foreign investors having “national defense and security” concerns and mergers and acquisitions
through which foreign investors may acquire de facto control over domestic enterprises that
raise “national security” concerns. The foregoing regulations prohibit foreign investors from
bypassing the security review by structuring transactions through trusts, indirect investments,
leases, loans, control through contractual arrangements or offshore transactions. On December
19, 2020, the NDRC and the MOFCOM jointly promulgated the Measures on the Security
Review of Foreign Investment (), effective on January 18, 2021,
setting forth provisions concerning the security review mechanism on foreign investment,
including the types of investments subject to review, review scopes and procedures, among
others.
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In the future, we may grow our business by acquiring complementary businesses.
Complying with the requirements of the above-mentioned regulations and other relevant rules
to complete such transactions could be time consuming, and any required approval processes,
including obtaining approval from the MOFCOM or its local counterparts or other relevant
government agencies may delay or inhibit our ability to complete such transactions,
transactions, which could affect our ability to expand our business or maintain our market
share.
Holders of H Shares may be subject to PRC income taxes.
Holders of H Shares, being non-PRC resident individuals or non-PRC resident
enterprises, whose names appear on the register of members of H Shares of our Company, are
subject to PRC income tax in accordance with the applicable tax laws and regulations, on
dividends received from us and gains realized through the sale or transfer by other means of
H shares by such shareholders.
According to the Individual Income Tax Law of the PRC and the Implementation
Regulations for the Individual Income Tax Law of the PRC, both came into effect on January
1, 2019, the tax applicable to non-PRC resident individuals is proportionate at a rate of 20%
for any dividends obtained from within China or gains on transfer of shares and shall be
withheld and paid by the withholding agent. Pursuant to the Arrangement between the
Mainland and the Hong Kong Special Administrative Region for the Avoidance of Double
Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income (the
“Arrangements ”) executed on August 21, 2006, the PRC Government may levy taxes on the
dividends paid by PRC companies to Hong Kong residents in accordance with the PRC laws,
but the levied tax (in the case the beneficial owner of the dividends are not companies directly
holding at least 25% of the equity interest in the company paying the dividends) shall not
exceed 10% of the total dividends.
According to the Enterprise Income Tax Law of the PRC, which was newly revised and
implemented on December 29, 2018, and the Implementation Regulations for the Enterprise
Income Tax Law of the PRC, which was newly revised and implemented on April 23, 2019, if
a non-resident enterprise has no presence or establishment within China, or if it has established
a presence or establishment but the income obtained has no actual connection with such
presence or establishment, it shall pay an enterprise income tax on its income derived from
within China with a reduced rate of 10%. Pursuant to the Arrangements, dividends paid by PRC
resident enterprises to Hong Kong residents can be taxed either in Hong Kong or in accordance
with the PRC laws. However, if the beneficial owner of the dividends is a Hong Kong resident,
the tax charged shall not exceed: (i) 5% of the total amount of dividends if the Hong Kong
resident is a company that directly owns at least 25% of the capital of the PRC resident
enterprise paying dividends; (ii) otherwise, 10% of the total amount of dividends.
Considering the above, non-PRC resident holders of our H Shares should be aware that
they may be obligated to pay PRC income tax on the dividends and gains realized through sales
or transfers by other means of the H Shares.
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Changes in international relationships and trade policies may adversely impact our
business, financial condition and results of operations.
Any government policies on international trade, such as capital controls or tariffs, may
affect the demand for our future drug products, the competitive position of our future drug
products, the hiring of scientists and other research and development personnel, and import or
export of raw materials in relation to drug development and production, or may prevent us from
selling our future drug products in certain countries. If any new tariffs, legislation and
regulations are implemented, or if existing trade agreements are renegotiated, such changes
could have an effect on our business, financial condition and results of operations. For
example, the U.S. government has recently made significant changes in its trade policy and has
taken certain actions that may materially impact international trade, such as imposing several
rounds of tariffs. It is unknown whether and to what extent new tariffs (or other new laws or
regulations) will be adopted, or the effect that any such actions would have on us or our
industry.
The evolving trade disputes may escalate going forward and may result in certain types
of goods, such as advanced research and development equipment and materials, becoming
significantly more expensive to procure from overseas suppliers or even becoming illegal to
export. Furthermore, there can be no assurance that our existing or potential service providers
or collaboration partners will not alter their perception of us or their preferences as a result of
adverse changes to the state of political relationships among the relevant countries or regions.
Trade disputes, tensions and political concerns among the relevant countries or regions may
therefore adversely affect our business, financial condition, results of operations, cash flows
and prospects.
Y ou may experience difficulties in effecting service of process or enforcing foreign
judgments against us, our executive Directors or senior management.
We are a company incorporated in the PRC. Most of our Directors and senior management
reside in China and most of their assets are within China. Therefore, it may be difficult for
investors to directly effect service of legal process upon us or our Directors and senior
management personnel in the PRC.
On July 14, 2006, China and Hong Kong signed 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 (ج
τર) (the “ Arrangement ”), which
came into effect on August 1, 2008. On January 18, 2019, the PRC Supreme Court and the
Hong Kong government signed 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 (ʝႩ̙ձੂБ͏ਠ
τર), or the New Arrangement, which seeks to establish a mechanism with
greater clarity and certainty for recognition and enforcement of judgments in wider range of
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civil and commercial matters between Hong Kong and the PRC. The Arrangement had been
superseded by the New Arrangement, which took effect on January 29, 2024 through the
Mainland Judgments in Civil and Commercial Matters (Reciprocal Enforcement) Ordinance
(Cap. 645) (the “ Judgment Ordinance ”) and relevant rules (Cap. 645A) (the “ Judgment
Rules ”). The regime under the Arrangement will continue to apply to judgments (given
pursuant to an exclusive jurisdiction agreement in favor of the courts in Mainland China or
Hong Kong) entered into on or after August 1, 2008 and dated before the commencement date
of the Judgment Ordinance and the Judgment Rules. The Judgment Ordinance and Judgment
Rules will not apply retrospectively and will only apply to judgments given on or after
January 29, 2024.
If we, our CROs, or our collaborative partners fail to comply with environmental, health
and safety laws and regulations, we could be subject to fines or penalties and other
negative consequences 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. Our R&D facilities involve the use of hazardous
and flammable materials, including chemicals and materials, and may produce hazardous
wastes. We contract with third parties for the disposal of these materials and wastes, however,
we cannot fully eliminate the risk of accidental contamination, biological or chemical hazards
or personal injury at our facilities during the process of R&D of our drug candidates and drug
products. In the event of such accident, we could be held liable for damages and clean-up costs
which, to the extent not covered by existing insurance or indemnification, could materially and
adversely our business. Other adverse effects could result from such liability, including
reputational damage. We may also be forced to close or suspend operations at certain of our
affected facilities temporarily, or permanently. As a result, any accidental contamination,
biological or chemical hazards or personal injury could have a material and adverse impact on
our business, financial condition, results of operations and prospects.
Although we maintain insurance policies that cover clinical trial liability insurance and
personal insurance, these insurance policies may not provide adequate coverage against
potential liabilities in respect of environmental, health and safety issues. Furthermore, we may
be required to incur substantial costs 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. Failure to comply with these laws and regulations
also may result in substantial fines, penalties or other sanctions. Moreover, there is increasing
stakeholder pressure on companies to diligence environmental, social, and governance matters
in the supply chain. Negative publicity regarding production methods, alleged practices or
workplace or related conditions of any of our suppliers, CROs or other third parties we
collaborate with who perform services for us could adversely affect our reputation and force
us to locate alternatives, which could increase our costs and result in delayed supply of
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components for, and manufacturing of, our drug candidates, or other disruptions to our
operations. Any of the foregoing could materially adversely affect our business, financial
condition, results of operations and prospects.
RISKS RELATING TO OUR INTELLECTUAL PROPERTY RIGHTS
If we are unable to obtain and maintain sufficient patent and other 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 our drug candidates may be adversely affected.
Our commercial success depends, to a certain extent, on our ability to protect our
proprietary technology and drug candidates from competition by obtaining, maintaining,
defending and enforcing our intellectual property rights, including patent rights. We seek to
protect the drug candidates and technology that we consider commercially important primarily
by filing patent applications in China, the U.S. and other countries or regions, relying on trade
secrets or pharmaceutical regulatory protection or employing a combination of these methods.
As of the Latest Practicable Date, we (i) owned seven issued patents, including two issued
patents in the PRC, three issued patents in Japan and two issued patent in the U.S.; and (ii) have
more than 11 pending patent applications, including one pending patent application in the PRC,
three pending patent applications under the European Patent Convention and more than seven
unpublished pending patent applications under the Patent Cooperation Treaty. For details,
please refer to “Business — Intellectual Property” in this prospectus. This process is expensive
and time-consuming, and we or our business partners may not be able to file and prosecute all
necessary or desirable patent applications and secure other intellectual property protection in
all jurisdictions in a timely manner. It is also possible that we or our business partners will fail
to identify patentable aspects of our research and development output before it is too late to
obtain patent protection. Moreover, we or our business partners may fail to timely identify
third-party infringement of our intellectual property rights related to our drug candidates
including infringement claims for our HX009 and HX301 outside of the PRC, and take
necessary actions to defend and enforce our rights, or at all.
The issuance of a patent is not conclusive as to its scope, validity or enforceability, and
our owned and licensed patents may be challenged in the courts or patent offices in any
jurisdictions. Such challenges may result in patent claims being narrowed, invalidated or held
unenforceable, which could limit our ability to stop 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. As a result, our patent
portfolio may not provide us with sufficient rights to exclude others from commercializing
drug candidates similar or identical to ours. Our competitors may also be able to circumvent
our patent issuance by developing similar or alternative technologies or drug candidates in a
non-infringing manner.
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Patent protection depends on compliance with various procedural, regulatory and other
requirements, and our patent protection could be reduced or eliminated due to
non-compliance.
Periodic maintenance fees, renewal fees, annuity fees and various other governmental
fees on patents and patent applications are due to be paid to the China National Intellectual
Property Administration (the “ CNIPA”), the United States Patent and Trademark Office (the
“USPTO ”) and other applicable patent agencies in several stages over the lifetime of a patent.
The CNIPA, the USPTO and other applicable patent agencies require compliance with a
number of procedural, documentary, fee payment, and other similar provisions during the
patent application process. Although 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 non-compliance 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.
Non-compliance events that could result in abandonment or lapse of a patent or patent
application include failure to respond to official actions within prescribed time limits,
non-payment of fees, and failure to properly legalize and submit formal documents. In any such
event, our competitors might be able to enter the market, which would have a material adverse
effect on our business.
If our patent terms expire before or soon after our drug candidates are approved, or if
competitors successfully challenge our patents, our business may be materially harmed.
Lack of protection under the applicable patent linkage and patent term extension laws
and regulations could increase the risk of early generic competition.
Patents have a limited duration. Depending on the jurisdiction, various extensions may be
available, but the life of a patent, and the protection it affords, is limited. For example, the
expiration of a patent is generally 20 years for inventions in China and generally 20 years from
the earliest date of filing of the first non-provisional patent application to which the patent
claims priority in the U.S. Even if patents covering our drug candidates, their manufacture, or
use are obtained, once the patent life has expired, we may be open to competition from
competitive medications, including biosimilar medications. Manufacturers of generic or
biosimilar drugs may challenge the scope, validity, or enforceability of our patents in court or
before a patent office, and we may not be successful in enforcing or defending those
intellectual property rights and, as a result, may not be able to develop or market the relevant
product exclusively, which would have a material adverse effect on any potential sales of that
product. Upon the expiration of our issued patents or patents that may issue from our patent
applications, we will not be able to assert such patent rights against potential competitors and
our business and results of operations may be adversely affected.
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Given the amount of time required for the development, testing and regulatory review of
new drug candidates, patents protecting such drug candidates might expire before or shortly
after such drug candidates are commercialized. As a result, our owned and licensed-in patents
and patent applications may not provide us with sufficient rights to exclude others from
commercializing products similar or identical to ours. Even if we believe that we are eligible
for certain patent term extensions, there can be no assurance that the applicable authorities,
including the FDA and the USPTO in the U.S., and any equivalent regulatory authority in other
countries, will agree with our assessment of whether such extensions are available, and such
authorities may refuse to grant extensions to our patents, or may grant more limited extensions
than we request. For example, depending upon the timing, duration and specifics of any FDA
marketing approval of any drug candidates we may develop, one or more of our U.S. patents
may be eligible for limited patent term extension under the Drug Price Competition and Patent
Term Restoration Action of 1984, or Hatch-Waxman Amendments. The Hatch-Waxman
Amendments permit a patent extension term of up to five years as compensation for the patent
term lost during the FDA regulatory review process. A patent term extension cannot extend the
remaining term of a patent beyond a total of 14 years from the date of product approval, only
one patent may be extended, and only those claims covering the approved drug, a method for
using it, or a method for manufacturing it, may be extended. Similarly, the amendment to the
PRC Patent Law which was amended on October 17, 2020 and became effective on June 1,
2021, introduced patent extensions to patents of new drugs that launched in the PRC, which
may enable the patent owner to submit applications for a patent term extension of up to a
maximum length of five years. However, we may not be granted an extension because of, for
example, failing to exercise due diligence during the testing phase or regulatory review
process, failing to apply within applicable deadlines, failing to apply prior to expiration of
relevant patents, or otherwise failing to satisfy applicable requirements.
Moreover, the applicable time period or the scope of patent protection afforded could be
less than we request. If we are unable to obtain a patent term extension or the term of any such
extension is less than we request, our competitors may obtain approval of competing products
following our patent expiration, and our business could be harmed.
In addition, some of our patents and patent applications may in the future be co-owned
with third parties. If we are unable to obtain an exclusive license to any such third-party
co-owners’ interest in such patents or patent applications, such co-owners may be able to
license their rights to other third parties, including our competitors, and our competitors could
market competing products and technology. Besides this, we may need the cooperation of any
such co-owners of our patents in order to enforce such patents against third parties, and such
cooperation may not be provided to us. Any of the foregoing could have a material adverse
effect on our competitive position, business, financial condition, results of operations and
prospects.
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We may not be able to protect our intellectual property rights, or prevent unfair
competition by third parties, throughout the world.
Filing, prosecuting, maintaining and defending patents for our drug candidates in all
countries throughout the world could be prohibitively expensive, and our intellectual property
rights in some countries can have a different scope and strength than do those in some other
countries. In addition, the laws of certain countries do not protect intellectual property rights
to the same extent as the laws of certain other countries. Consequently, we may not be able to
prevent third parties from practicing our inventions in all countries, or from selling or
importing drugs made using our inventions in and into certain jurisdictions. Competitors may
use our technologies in jurisdictions where we have not obtained patent protection to develop
their own drugs and further, may export otherwise infringing drugs to certain jurisdictions
where we have patent protection, but where enforcement rights are not as strong as those in
certain other countries. These drugs may compete with our drug candidates and our patent
rights or other intellectual property rights may not be effective or adequate to prevent them
from competing.
The legal systems of some countries do not favor the enforcement of patents, trade secrets
and other intellectual property, particularly those relating to biopharmaceutical products, which
could make it difficult in those jurisdictions for us to stop the infringement, misappropriation
or other violation of our patents or other intellectual property rights, or the marketing of
competing drugs in violation of our proprietary rights. Proceedings to enforce our intellectual
property and proprietary rights in foreign jurisdictions could result in substantial costs and
divert our efforts and attention from other aspects of our business, could put our patents at risk
of being invalidated or interpreted narrowly, could put our patent applications at risk of not
issuing, and could provoke third parties to assert claims against us.
We may not prevail in any lawsuits that we initiate and any damages or remedies awarded,
if any, may not be commercially meaningful. Accordingly, our efforts to enforce our
intellectual property rights around the world may prove insufficient to secure a meaningful
competitive and commercial advantage from the intellectual property that we develop or
license. Any of the foregoing could materially adversely affect our business, financial
condition, results of operations and prospects.
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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.
We may apply for a number of trademarks in China, the U.S. and other jurisdictions. Our
registered or unregistered trademarks or trade names may be challenged, infringed,
circumvented or declared generic or determined to be infringing on other marks. We may not
be able to protect our rights to these trademarks and trade names, which we need to build name
recognition among potential partners or customers in our markets of interest. At times,
competitors 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 registered
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. Our efforts to enforce or protect our proprietary rights
related to trademarks, trade secrets, domain names, copyrights or other intellectual property
may be ineffective and could result in substantial costs and diversion of resources and could
adversely affect our competitive position, business, financial condition, results of operations,
and prospects.
If we are unable to protect the confidentiality of our trade secrets and other confidential
information, including unpatented know-how, our business and competitive position
would be harmed.
In addition to our issued patents and patent applications, we rely on trade secrets and
other confidential information, including unpatented know-how, drug development technology,
and other proprietary information, to maintain our competitive position and to protect our drug
candidates or drug products.
However, we may not be able to prevent the unauthorized disclosure or use of our trade
secrets and other confidential information by the parties to these agreements. Any of the parties
with whom we enter into confidentiality agreements may breach or violate the terms of any
such agreements and may disclose our proprietary information, and we may not be able to
obtain adequate remedies for any such breach or violation. Additionally, we cannot guarantee
that we have entered into such agreements with each party that may have or has had access to
our trade secrets or proprietary technology and processes. Enforcing a claim that a party
illegally disclosed or misappropriated trade secrets or other confidential information can be
difficult, expensive and time-consuming, and the outcome is unpredictable. If any of our trade
secrets or other confidential information were to be lawfully obtained or independently
developed by a competitor or other third party, we would have no right to prevent them from
using that technology or information to compete with us and our competitive position would
be harmed.
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Furthermore, many of our employees, consultants and advisors were previously employed
at other biopharmaceutical companies, including our competitors or potential competitors.
Although we try to ensure that our employees, consultants and advisors are under no
non-competition obligations to their former employers at the time of hiring, and that they do
not use the confidential information or know-how of others in their work for us, we may be
subject to claims that we or these employees have used or disclosed intellectual property,
including trade secrets or other confidential information, of any such individual’s former
employer. 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 our management.
In addition, while we typically require our employees, consultants and contractors who
may be involved in the R&D activities or any other activities involving 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. Further, the assignment of intellectual property
rights may not be self-executing, or the assignment agreements may be breached, each of which
may result in claims by or against us related to the ownership of such 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 and could have a material adverse effect on our
business, financial condition, results of operations and prospects.
Intellectual property and other laws and regulations in China, the U.S. or other
jurisdictions are subject to change, which could diminish the value of our intellectual
property and impair the intellectual property protection of our drug candidates.
Changes in intellectual property laws or their interpretation in China, the U.S. or other
jurisdictions may increase the uncertainties and costs associated with the prosecution of our
patents, diminish our ability to protect our inventions, obtain, maintain, defend, and enforce
our intellectual property rights and, more generally, affect the scope and value of our
intellectual property rights. In the PRC, intellectual property laws are constantly evolving, with
efforts being made to improve intellectual property protection, such as the amendment to the
PRC Patent Law which was amended on October 17, 2020 and became effective on June 1,
2021, introduced patent term compensation mechanism for eligible invention patents related to
new drugs.
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Such amendments in laws either of China or foreign jurisdictions may impact the value
of our patent rights or our other intellectual property rights, all of which could have a material
adverse effect on our patent rights and our ability to protect, defend and enforce our patent
rights in the future, as well as on our competitive position, business, financial conditions,
results of operations and prospects.
We may from time to time be involved in disputes and lawsuits to protect or enforce our
intellectual property rights, or defend ourselves against infringement and other claims
alleged by third parties, which could be expensive, time consuming and unsuccessful.
Despite measures we take to obtain and maintain patent and other intellectual property
rights with respect to our drug candidates, our intellectual property rights (including those
transferred or licensed from other third parties) could be challenged by external parties
(including but not limited to our competitors and former employees) or invalidated. For
example, although we believe that we have conducted our patent prosecution in accordance
with a duty of candor and in good faith, the outcome following legal assertions of invalidity
and unenforceability during patent litigation is unpredictable. On the other hand, competitors
or other third parties may infringe or misappropriate our patents and other intellectual property
rights. Furthermore, Mr. Xi, a former employee of our Group, may have potential dispute with
the Company on the Company’s patent. For details, please refer to “Business — Risk
management and internal control — Internal Control — Misappropriation of funds by former
employee of our Group”. To counter infringement or unauthorized use, we may be required to
file infringement claims, which can be expensive and time consuming. In any infringement
proceeding, a court may decide that a patent of ours is not valid or is unenforceable, or may
refuse to stop the other party from using the technology at issue on the grounds that our patents
do not cover the technology in question. Moreover, our intellectual property rights may be
subject to future claims from former employees, collaborators, or third parties to assert their
rights or interests.
An adverse result in any litigation or defense proceedings could put one or more of our
intellectual property rights at risk of being invalidated or interpreted narrowly, or could cause
us to pay monetary compensation. Even if successful, litigation may result in substantial costs
and distraction of our management and other employees. Furthermore, because of the
substantial amount of discovery required in connection with intellectual property litigation,
there is a risk that some of our confidential information could be compromised by disclosure
during this type of litigation.
In addition, there could be public announcements of the results of hearings, motions or
other interim proceedings or developments. If the public, securities analysts or investors
perceive these results to be negative, or perceive that the presence or continuation of these
cases creates a level of uncertainty regarding our ability to increase or sustain products sales,
it could have a substantial adverse effect on the price of our Shares. There is no assurance that
our drug candidates and generic drug products will not be subject to the same risks.
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Intellectual property rights do not necessarily protect us from all potential threats to our
competitive advantages.
The degree of future protection afforded by our intellectual property rights is uncertain
because intellectual property rights have limitations, and may not adequately protect our
business nor permit us to maintain our competitive advantages. Examples include but not
limited to: (i) others may be able to make drug candidates that are the same as or similar to our
drug candidates but that are not covered by the claims of the patents that we own or may have
exclusively licensed; (ii) we might not have been the first to file patent applications covering
certain of our inventions; (iii) others may independently develop similar or alternative
technologies or duplicate any of our technologies without infringing our intellectual property
rights; (iv) third parties might conduct research and development activities in countries where
we do not have patent rights and then use the information learned from such activities to
develop competitive products for sale in our major commercial markets; and (v) we may not
develop additional technologies that are patentable.
RISKS RELATING TO COMMERCIALIZATION OF OUR DRUG CANDIDATES AND
PRODUCTS
The future commercial success of our drug candidates will depend on the degree of their
market acceptance among physicians, patients and others in the medical community.
Even if our drug candidates receive the requisite regulatory approvals, they may fail to
gain sufficient market acceptance by physicians, patients, third-party payers and other relevant
parties in the medical community. If our drug candidates do not achieve an adequate level of
acceptance, we may not generate significant revenue from sales of our drugs and we may not
become profitable.
Even if our drugs achieve market acceptance, we may not be able to maintain that market
acceptance over time if new products or technologies are introduced that are more favorably
received than our drugs, are more cost effective or render our drugs obsolete. Our failure to
achieve or maintain market acceptance for our future approved drug candidates would
materially adversely affect our business, financial condition, results of operations and
prospects.
Our drug candidates may not be covered by insurance or reimbursement programs or
may become subject to unfavorable insurance policies or reimbursement practices, either
of which could harm our business, and we may be subject to unfavorable pricing
regulations, which could make it difficult for us to sell our drugs profitably.
The regulations that govern regulatory approvals, pricing and reimbursement for new
therapeutic products vary significantly from country to country. We intend to seek approval to
market our drug candidates in China, the U.S. and in other jurisdictions. In China, the pricing
of drugs and biologics is subject to governmental regulation, which can be a lengthy process
even after obtaining regulatory approval. Our ability to commercialize any approved drug
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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.
A primary trend in the global healthcare industry is cost containment. Government
authorities and these third-party payers have attempted to control costs by limiting coverage
and the amount of reimbursement for particular medications. In China, the Ministry of Human
Resources and Social Security of China, together with other government authorities, review the
inclusion or removal of drugs from the China’s National Drug Catalog for Basic Medical
Insurance, Work-related Injury Insurance and Maternity Insurance (ᎈeʈ
ͦ፽), or the National Reimbursement Drug List (the “NRDL”),
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. If we were to successfully launch commercial sales of our drugs but fail
in our efforts to have our drug products included in the NRDL, our revenue from commercial
sales would be highly dependent on patient self-payment, which can make our drug products
less competitive. Patients may choose other drugs with similar efficiency but lower price which
have been included in the NRDL. Additionally, even if the Ministry of Human Resources and
Social Security of China or any of its local counterparts were to accept our application for the
inclusion of products in the NRDL, our potential revenue from the sales of these products could
still decrease as a result of the significantly lowered prices we may be required to charge for
our products to be included in the NRDL.
In the U.S., no uniform policy of coverage and reimbursement for drugs exists among
third-party payers. As a result, obtaining coverage and reimbursement approval of a drug from
a government or other third-party payer is a time-consuming and costly process that could
require us to provide to each payer supporting scientific, clinical and cost-effectiveness data
for the use of our future approved drugs on a payer-by-payer basis, with no assurance that
coverage and adequate reimbursement will be obtained. Even if we obtain coverage for a given
drug, the resulting reimbursement rates might not be adequate for us to achieve or sustain
profitability or may require co-payments that patients find unacceptably high. Additionally,
third-party payers may not cover, or provide adequate reimbursement for, long-term follow-up
evaluations required following the use of our future approved drug candidates. Patients are
unlikely to use any of our future approved drug candidates unless coverage is provided and
reimbursement is adequate to cover a significant portion of the cost of the drugs.
We cannot be sure that reimbursement will be available for any approved drug candidates
that we commercialize nor can we predict the level of reimbursement that may be offered.
Reimbursement may impact the demand for, or the price of, any approved drug candidates that
we commercialize. If reimbursement is not available or is available only to limited levels, we
may not be able to successfully commercialize any drug candidates that we successfully
develop.
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There may also be significant delays in obtaining reimbursement for approved drug
candidates, and reimbursement coverage may be more limited than the approved indications of
the drug candidates by the NMPA, the FDA or other comparable regulatory authorities.
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. Payment rates may vary according to the uses of the drugs and the clinical setting
in which the drugs are 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. Our
inability to promptly obtain reimbursement coverage at intended payment rates for our drug
candidates and any new drug candidates that we develop could have a material adverse effect
on our business, operating results, and overall financial conditions.
We currently target a sub-group of targeted cancer. The size of the potential market for
our current or future drug candidates, including for our Core Product HX009, is difficult
to estimate and, if any of our assumptions are inaccurate, the actual markets for our
current or future drug candidates may be smaller than our estimates.
Our projections of the number of patients who have the potential to benefit from treatment
with our drug candidates are based on our beliefs and estimates. These estimates have been
derived from a variety of sources, including scientific literature, surveys of clinics, patient
foundations, or market research and may prove to be incorrect. Further, new studies may
change the estimated incidence or prevalence of these diseases, potentially leading to a smaller
patient population than anticipated. Consequently, the size of the addressable patient
population may ultimately be less than we expect, which could significantly impact our market
potential and revenue forecasts.
Our spending on our Core Product, namely HX009, for the specific indications of
relapsed/refractory EBV
+ NHL, advanced melanoma, advanced BTC and advanced TNBC,
respectively, may not yield any commercially viable products, since these indications are a
sub-group of the targeted cancers and the market opportunities for them may be smaller than
we anticipate. For example, other players developing similar treatment methods in the target
markets that may be more competitive than us, which may further limit the market
opportunities of our Core product. As such, the target markets for our Core Product may not
consist of as many market opportunities as we expect, which could have a material adverse
effect on the profitability of our Core Product even if commercialized.
Furthermore, there is no guarantee that any of our drug candidates, even if approved,
would be approved for the line of therapy we are aiming for. For example, certain therapies
may be characterized as first line, second line or later line therapy depending on options for
treatment and prior treatments received. For indications with well-established standard of care
therapies, the NMPA, the FDA and other comparable regulatory authorities may approve new
therapies initially only for later lines of therapy. While we may seek approval for our drug
candidates as an early-line therapy for certain indications, there is no guarantee that they will
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be approved as such. As a result, even if we obtain market approval for our drug candidates,
we may not achieve the anticipated market size and revenue unless such market approval is for
the intended lines of therapy or for additional indications.
If safety, efficacy, or other issues arise with any medical product that is used in
combination with our drug candidates, we may be unable to market such drug candidates
or may experience supply shortages or be subjected to regulatory measures, and our
business could be materially harmed.
We plan to develop certain of our drug candidates for use as combination therapies.
Combination therapy development carries a higher risk of failure compared to single agent
development due to greater risk of combined drug toxicity as well as lower efficacy due to
drug-drug interactions as well as toxicity limitations on efficacy. The development risks of
failure are even higher if both agents are investigational. There are additional regulatory
requirements for combination development to ensure patient safety during development,
including the requirement for separate combination IND review and the trial designs which are
also more complex and require close monitoring. If any regulatory agency revokes its approval
of any pharmaceutical products or therapy we intend to use in combination with our drug
candidates, we will be forced to terminate or re-design the clinical trials, or will not be able
to market our drug candidates in combination with such revoked pharmaceutical products or
therapies. For example, we are currently conducting a combination study of our Core Product,
HX009, with a pivotal trial stage (Stage III) FAKi drug in patients with advanced malignant
biliary tract cancer and melanoma. Currently, this FAKi drug is under the pivotal-stage (Stage
III) study development, and obtaining NDA market approval on our HX009 for the treatment
of BTC relies on the successful market development of this drug. Also, we are conducting a
combination study of our Key Product, HX301, with temozolomide in patients with
glioblastoma. The brand name for the temozolomide used in the HX301-II-01 China Study is
Tazian
®, which was included in the NRDL. If safety or efficacy issues arise with these or other
therapies that we seek to combine with our drug candidates in the future, we may be subjected
to regulatory measures, and we may be required to redesign or terminate the relevant clinical
trials. In addition, if manufacturing or other issues result in a supply shortage of any
component of our combination drug candidates, we may not be able to complete clinical
development of our drug candidates on our current timeline, or at all.
Counterfeit products and the illegal and/or parallel import of competing drugs may
reduce demand for our drug candidates, which could have a negative impact on our
reputation and business.
The illegal import of competing products from countries where government price controls
or other market dynamics result in lower prices may adversely affect the demand for our drug
candidates and, in turn, may adversely affect our sales and profitability in China and other
countries where we plan to commercialize our approved products. Unapproved foreign imports
of prescription drugs are illegal under current laws of China. However, illegal imports may
continue to occur or even increase as the ability of patients and other customers to obtain these
lower priced imports continues to grow. Furthermore, cross-border imports from lower-priced
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markets (parallel imports) into higher-priced markets could harm sales of our drugs and exert
commercial pressure on pricing within one or more markets. In addition, competent
government authorities may expand consumers’ ability to import lower priced versions of our
future approved products or competing products from outside China or other countries where
we operate. Any future legislation or regulations that increase consumer access to lower priced
medicines from outside China or other countries where we operate could have a material
adverse effect on our business.
Furthermore, certain products distributed or sold in the pharmaceutical market may be
manufactured without proper licenses or approvals, or be fraudulently mislabeled with respect
to their usage or manufacturers. These products are generally referred to as counterfeit
pharmaceutical products. The regulatory control and law enforcement system in relation to the
counterfeit pharmaceutical products may be inadequate to discourage or eliminate the
manufacturing and sale of counterfeit pharmaceutical products imitating our products. Since
counterfeit pharmaceutical products in many cases have very similar appearances compared
with the authentic pharmaceutical products but are generally sold at lower prices, counterfeits
of our drug candidates can quickly erode the demand for our drug candidates. In addition, theft
of inventory at warehouses, plants or while in-transit, which is not properly stored and which
is sold through unauthorized channels, could adversely impact patient safety, our reputation
and our business. A patient who receives a counterfeit pharmaceutical product may be at risk
for a few dangerous health consequences, which potentially exposes us to product liability
claims, government investigations, and other disputes and negative consequences. Our
reputation and business could suffer harm as a result of counterfeit pharmaceutical products
sold under our or our collaborators’ brand name(s).
Negative results from off-label use of our future marketed drug products could materially
harm our business reputation, product brand and financial condition as well as expose us
to potential liability.
Products distributed or sold in the pharmaceutical market may be subject to off-label drug
use. Off-label drug use is prescribing a product for an indication, dosage or in a dosage form
that is not in accordance with regulatory approved usage and labeling. Even though the NMPA,
the FDA and other comparable regulatory authorities actively enforce the laws and regulations
prohibiting the promotion of off-label use, there remains the risk that our future marketed drug
product is subject to off-label drug use and is prescribed in a patient population, dosage or
dosage form that has not been approved by competent authorities. This occurrence may render
our products less effective or entirely ineffective and may cause adverse drug reactions or
adverse events. Any of these occurrences can create negative publicity and materially and
adversely affect our business reputation, product brand, commercial operations and financial
condition, including our share price. These occurrences may also expose us to liability and
cause a delay in the progress of our clinical trials and may ultimately result in failure to obtain
regulatory approval for our drug candidates.
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RISKS RELATING TO DEPENDENCE ON THIRD PARTIES
We substantially rely on third parties to monitor, support and conduct clinical trials and
preclinical studies of our drug candidates. If these third parties do not successfully carry
out their contractual duties or meet expected timelines, we may not be able to obtain
regulatory approval for, or commercialize, our drug candidates, and our business could
be materially affected.
We have relied upon and plan to continue to rely upon third-party CROs, clinical trial
sites, consultants and other third parties to monitor, support and conduct preclinical studies and
clinical trials of our drug candidates. As a result, we do not have full control over their
activities or the quality, timing and cost of these studies. Nevertheless, we are responsible for
ensuring that each of our studies is conducted in accordance with the applicable protocol and
legal, regulatory and scientific standards, and our reliance on the CROs and other third parties
does not relieve us of our regulatory responsibilities.
In particular, we, our CROs and our clinical investigators are required to comply with
GCP , Good Laboratory Practice for Non-clinical Laboratory Studies (Ӻሯඎ၍
ଣ஝ᇍ) (the “ GLP”), and other regulatory regulations and guidelines enforced by the
NMPA, the FDA, and comparable regulatory authorities for all of our drug candidates in
clinical development. Regulatory authorities may enforce these GCP , GLP or other regulatory
requirements through periodic inspections of trial sponsors, investigators and trial sites. In
addition, our clinical trials must be conducted with drug candidates or products produced under
current cGMP requirements.
In addition, we may not be able to enter into arrangements with alternative CROs and
other third parties in a timely manner or do so on commercially reasonable terms, if our
existing relationships with these third parties terminate. Transitioning to new CROs or adding
additional third parties can incur extra costs and lead to delays, which can materially affect our
ability to meet our desired clinical development timelines. 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 effect on our business, financial condition and prospects.
We depend on third parties to provide a stable and adequate supply of quality materials,
products and equipment for our drug development needs. Any interruptions of or
significant price increases in such supply could adversely affect our business.
During the Track Record Period, we relied on third parties to supply certain raw materials,
products and equipment used in our research and development. We expect to continue to rely
on third parties to supply raw materials, products and equipment for the research, development
and commercialization of our drugs. However, any disruption in production or the inability of
our suppliers to provide adequate quantities to meet our needs could impair our operations and
the research and development of our drug candidates.
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Moreover, we expect our demand for such raw materials, products and equipment to
increase as we expand our business scale and commercialize our drug candidates, but there is
no assurance that current suppliers have the capacity to meet our demand. We are also exposed
to the possibility of increased costs, which we may not be able to pass on to customers and as
a result, lower our profitability.
We cannot assure you that these third-party suppliers will be able to maintain and renew
all licenses, permits and approvals necessary for their operations or comply with all applicable
laws and regulations. Failure to do so by them may lead to interruption in their business
operations, which in turn may result in shortage of the raw materials, products and equipment
supplied to us, and cause delays in clinical trials and regulatory filings or even recall of our
products. The non-compliance of these third parties may also subject us to potential product
liability claims, result in our failure to comply with the continuing regulatory requirements,
and cause us to incur significant costs, which may have a material and adverse effect on our
business, financial condition and results of operations.
We are subject to risks in relation to acquisitions or strategic partnerships. We may not
realize any or all benefits of such alliances or licensing arrangements, and disputes may
arise between us and our current or future collaboration partners.
From time to time, we may evaluate various acquisitions and strategic partnerships,
including in-licensing or acquiring complementary products, intellectual property rights,
technologies or businesses. For example, we have transferred our equity interests in Taizhou
Hanzhong to Lepu in return for a one-off cash payment of RMB350.0 million and an annual
fee in the amount of 4.375% of the net sales revenue of HX008.
We face significant competition in identifying suitable strategic partners and the
negotiation process is time-consuming and complex. Moreover, we may not be successful in
our efforts to establish a strategic partnership or other alternative arrangements for our drug
candidates because they may be deemed to be at too early of a stage of development for
collaborative effort and third parties may not view our drug candidates as having the requisite
potential to demonstrate safety and efficacy or commercial viability. In addition, if we
undertake acquisitions, we may issue dilutive securities, assume or incur debt obligations,
incur large one-time expenses and acquire intangible assets that could result in significant
future amortization expense. For any drug candidates that we may seek to in-license from third
parties, we may face significant competition from other pharmaceutical or biopharmaceutical
companies with greater resources or capabilities than us, and any agreement that we do enter
into may not result in the anticipated benefits.
As a result, we may not be able to realize the benefit of current or future collaborations,
strategic partnerships or the license of our third-party drugs if we are unable to successfully
integrate such products 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 strategic transaction or license, we will 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
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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 sales
or marketing activities, 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 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 prospects, financial condition and results of operations.
The PRC regulations and rules concerning mergers and acquisitions, including the
Anti-Monopoly Law of PRC () and the Provisions of the State
Council on Thresholds for Prior Notification of Concentrations of Undertakings ( ਷ਕ৫ᗫ
) issued by the State Council, and other recently adopted
regulations and rules with respect to mergers and acquisitions established additional
procedures and requirements that could make merger and acquisition activities by foreign
investors more time-consuming and complex. The concentration of business undertakings by
way of mergers, acquisitions or contractual arrangements that allow one market player to take
control of or to exert decisive impact on another market player must also be filed in advance
to the MOFCOM when the threshold is crossed and such concentration shall not be
implemented without the clearance of prior filing. For details, please refer to “— Risks
Relating to Government Regulations — The M&A Rules and certain other PRC regulations
establish certain procedures for some acquisitions of Chinese companies by foreign investors,
which could make it more difficult for us to pursue growth through acquisitions in China” in
this section.
RISKS RELATING TO OUR OPERATIONS
The continued and collaborative efforts of our senior management, scientific employees
and other key employees are crucial to our success, and our business may be affected if
we lose their services.
We are highly dependent on the expertise and insights of our senior management team.
Recruiting and retaining qualified scientific, technical, clinical and marketing personnel in the
future will also be critical to our success. The loss of the services of any of these persons could
impede the achievement of our research, development and commercialization objectives.
Moreover, even though our key personnel are subject to non-compete obligations for a time
period, losing them may increase our competitive pressure, as they may join our competitors
or start competing businesses. Furthermore, replacing executive officers, scientific employees,
and other qualified personnel 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 products like
those we develop.
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Competition to hire from this limited pool is intense, and we may be unable to hire, train,
retain or motivate these key personnel or consultants on acceptable terms given the competition
among numerous biopharmaceutical companies for similar personnel. To compete effectively,
we may need to offer higher compensation and other benefits, which could materially and
adversely affect our financial condition and results of operations. In addition, we may not be
successful in training our professionals to keep pace with technological and regulatory
standards. Any inability to attract, motivate, train or retain qualified scientists or other
technical personnel may have a material adverse effect on our business, financial condition,
results of operations, cash flows and prospects.
We may encounter difficulties in managing our growth and expanding our operations
successfully.
Our future financial performance and our ability to commercialize our drug candidates
will also depend, in part, on our ability to effectively manage our growth, and our management
may also have to divert a disproportionate amount of its attention away from day-to-day
activities in order to implement our long-term development strategies. For details, please refer
to “Business — Our Strategies” in this prospectus.
If we are not able to effectively manage our growth and further expand our organization,
we may not be able to successfully develop and commercialize our drug candidates and,
accordingly, may not achieve our research, development and commercialization goals. Our
failure to do so could materially adversely affect our business, financial condition, results of
operations and prospects.
We may be involved in claims, disputes, litigation, arbitration or other legal proceedings
in the ordinary course of business, which could adversely affect our business, financial
conditions, results of operations and reputation.
From time to time, we may be involved in claims, disputes and legal proceedings in our
ordinary course of business or pursuant to governmental or regulatory enforcement activity.
These may concern issues relating to, among others, product liability, environmental matters,
breach of contract, employment or labor disputes and intellectual property rights. Any claims,
disputes or legal proceedings initiated by us or brought against us by external parties (including
but not limited to our competitors and former employees), with or without merit, may result in
substantial costs and diversion of resources, and if we are unsuccessful, could materially harm
our reputation. Furthermore, Mr. Xi, a former employee of our Group, may have potential
dispute with the Company on the operation of Hangzhou Hanx. For details, please refer to
“Business — Risk management and internal control — Internal Control — Misappropriation
of funds by former employee of our Group”. Furthermore, claims, disputes or legal proceedings
against us may be due to actions taken by our counterparties, such as our suppliers, CROs and
other service providers. Even if we are able to seek indemnity from them, they may not be able
to indemnify us in a timely manner, or at all, for any costs that we incur as a result of such
claims, disputes and legal proceedings.
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We may be subject to potential conflicts of interest with our minority Shareholders, which
could bring about disputes or legal, arbitral or administrative proceedings.
Even though we have substantial numbers of corporate governance measures in place to
prevent potential conflicts of interest that may arise between our minority Shareholders and us,
the interests of our minority Shareholders may still deviate from ours under certain
circumstances where we may be subject to disputes, legal, arbitral or administrative
proceedings instituted by our minority Shareholders. Any such disputes or proceedings could
harm our reputation, business, results of operations and prospects.
Our reputation is important to our success. Negative publicity with respect to us, our
Shareholders, management, employees, business partners, affiliates, or our industry, may
materially and adversely affect our reputation, business, results of operations and
prospects.
We believe that market awareness and recognition of our corporate reputation, and the
maintenance of a positive corporate reputation, is crucial to the success of our business.
However, our reputation is vulnerable to potential threats that can be difficult or impossible to
control, and costly or impossible to remediate. While we will continue to promote our brands
to remain competitive, we may not be successful in doing so. In addition, we may engage
various third parties to advance our clinical development programs, expand our
commercialization network and increase market access for our drugs, which can make it
increasingly difficult to effectively manage our brand reputation, as we have relatively limited
control over these third parties.
Any disputes, legal proceedings, regulatory inquiries, investigations, or other actions
involving us, our Shareholders, management, employees, business partners and affiliates, or
any perceived unethical, fraudulent, or inappropriate conduct by any of the above, could harm
our reputation and materially and adversely affect our business. Regardless of the merits or
outcome of such disputes, legal proceedings, regulatory inquiries, investigations or other
actions, our reputation may be substantially damaged, which may impede our ability to attract
and retain talent and business partners and grow our business.
Increased labor costs could slow our growth and affect our operations.
Our operations depend in part on the skills and know-how of our employees. In recent
years, the average labor cost in the global pharmaceutical market, particularly for highly
skilled and experienced personnel, has been steadily increasing as the competition for qualified
employees has become more intense. If we face labor shortages or significant increases in labor
costs, higher employee turnover rates or changes to labor laws and regulations, our operating
costs could increase significantly, which could materially adversely affect our results of
operations and financial condition. In addition, share options and other share-based incentives
granted under our existing or future share-based incentive arrangements and scheme could
adversely affect our costs and our results of operations. For details, please refer to “— Risks
Relating to Our Financial Position and Need for Additional Capital — Share-based payments
may impact our financial performance and cause shareholding dilution to our existing
Shareholders” in this section.
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We may be subject to additional social insurance fund and housing provident fund
contributions and late fees or fines imposed by relevant regulatory authorities.
Pursuant to the PRC laws and regulations, we are required to participate in the employee
social welfare plan administered by local governments. Such plan consists of pension
insurance, medical insurance, work-related injury insurance, maternity insurance,
unemployment insurance and housing provident fund. According to the Regulations on the
Administration of Housing Provident Fund (၍ଣૢԷ), an employer shall go
through the housing provident fund contribution registration with the housing provident fund
management center, and apply for the establishment of housing provident fund account for
employees. The amount we are required to contribute for each of our employees under such
plan should be calculated based on the actual income of our employees, together with the
minimum and maximum level as from time to time prescribed by national laws and regulations
and local authorities. During the Track Record Period and up to the Latest Practicable Date,
some of our Group companies did not pay social insurance for their employees on the
contribution bases determined on their actual salaries. Any failure to make timely and adequate
social welfare contribution for its employees may trigger an order of correction from
competent authority requiring the employer to make up the full amount of such overdue social
welfare contribution within a specified period of time, and the competent authority may further
impose fines or penalties. Pursuant to the relevant PRC laws and regulations, if any of the
relevant social insurance authorities is of the view that the social insurance contributions we
made for our employees do not comply with the requirements under the relevant PRC laws and
regulations, it may order us to pay the outstanding balance within a prescribed time period plus
a late fee of 0.05% of the total outstanding balance per day. If we fail to do so within the
prescribed period as requested by the relevant social insurance authorities, we may be subject
to a fine ranging between one to three times of the total outstanding balance.
We are subject to risks associated with leasing properties.
We have leased certain properties in the PRC in our business operations. 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
(ண௅) 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. The failure to file and obtain property
leasing filing certificates for such leases, as required under PRC laws, may subject us to a fine
ranging from RMB1,000 to RMB10,000 for each agreement not filed. As of the Latest
Practicable Date, the lease agreements with respect to two properties we lease in the PRC for
our business operations had not been registered and filed with the relevant PRC government
authorities. We estimate that the maximum penalty we may be subject to for these unregistered
lease agreements will be approximately RMB20,000. As advised by our PRC Legal Adviser,
failure to register such lease agreements with the relevant PRC government authorities does not
affect the validity of the relevant lease agreements but the relevant PRC government authorities
may order us or the lessors to, within a prescribed time limit, register the lease agreements. In
order to ensure on-going compliance with the PRC law and regulations relating to the
registration of executed lease agreements, we will continue to liaise with the lessors and try to
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register all the unregistered leases. For one of the leased properties of Hangzhou Hanx, the
landlord has not leased such property in accordance with the intended use specified on the land
use right certificate. If the title of any leased properties were successfully challenged, we may
be forced to relocate our operations on the affected properties and we may have to cease our
operation activities in the event we face challenges in relation to our properties. If we fail to
find suitable replacement properties or terms acceptable to us for the affected operations, our
business, financial condition and results of operations may be materially and adversely
affected. During the Track Record Period and as of the Latest Practicable Date, we had not
received any such request or suffered any such fine from the relevant PRC government
authorities. We believe that the failure to register these lease agreements will not have any
material adverse impact on our results of operations.
We cannot assure you that we are able to renew our lease on commercially acceptable
terms upon expiry, or at all. If the title of any of our leased properties is controversial or the
validity of the relevant lease is challenged by any third party, or if we fail to renew our lease
upon expiry, we may be compelled to relocate from the affected premises. Such relocation may
result in additional expenses or business interruption, which could, in turn, have an adverse
effect on our business, results of operations and financial condition.
We may be subject to natural disasters, health epidemics, acts of war or terrorism or
other factors beyond our control.
Natural disasters, health epidemics, acts of war or terrorism or other factors beyond our
control may adversely affect the economy, infrastructure and livelihood of the people in the
regions where we conduct our business. Our operations may be under the threat of natural
disasters, such as floods, earthquakes, sandstorms, snowstorms, fire or drought, the outbreak
of a widespread health epidemic, such as COVID-19, avian influenza, Severe Acute
Respiratory Syndrome (SARS), Ebola or other factors beyond our control, such as power, water
or fuel shortages, failures, malfunction and breakdown of information management systems,
unexpected maintenance or technical problems, or are susceptible to potential wars or terrorist
attacks.
The occurrence of a disaster or a prolonged outbreak of an epidemic illness, including the
COVID-19 pandemic, or other adverse public health developments could materially disrupt our
business and operations. For example, the extent to which COVID-19 affects our results of
operations going forward will depend on the future developments of the pandemic. These
uncertain and unpredictable factors include, but are not limited to, adverse effects of the
pandemic on the economy, potential delays of our ongoing and future clinical trials, and
disruptions to the operations of our business partners and CROs. To the extent the COVID-19
pandemic adversely affects our business and financial results, it may also have the effect of
heightening other risks described in this prospectus, including those relating to our ability to
initiate or continue clinical trials for our drug candidates.
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Acts of war or terrorism may also injure our employees, cause loss of lives, disrupt our
business network and destroy our markets. Any of the foregoing events and other events
beyond our control could have an adverse effect on the overall business sentiment and
environment, cause uncertainties in the regions where we conduct business, cause our business
to suffer in ways that we cannot predict and materially and adversely impact our business,
financial condition and results of operations.
We may be unable to detect, deter and prevent all instances of bribery, fraud or other
misconduct committed by our employees or third parties.
We may be exposed to fraud, bribery or other misconduct committed by our employees
or third parties that could subject us to financial losses and sanctions imposed by governmental
authorities, which may adversely affect our reputation. During the Track Record Period and up
to the Latest Practicable Date, we were not aware of any instances of fraud, bribery, or other
misconduct involving employees and other third parties that had any material and adverse
impact on our business and results of operations. However, we cannot assure you that there will
not be any such instances in the future. Although we consider our internal control policies and
procedures to be adequate, we may be unable to prevent, detect or deter all such instances of
misconduct by our employees or third parties. Any such misconduct committed against our
interests, which may include past acts that have gone undetected or future acts, may have a
material adverse effect on our business, results of operations and reputation.
Medical liability claims or lawsuits against us beyond our insurance coverage could result
in expensive and time-consuming litigation, payment of substantial damages and
increases in our insurance rates.
We face an inherent risk of medical liability as a result of the clinical testing and any
future commercialization of our drug candidates inside and outside China. For example, we
may be sued if our drug candidates cause or are perceived to cause injury or are found to be
otherwise unsuitable during clinical testing. Any such medical liability claims may include
allegations of defects in design, a failure to warn of dangers inherent in the drug, negligence,
strict liability or a breach of warranties. Even successful defense would require significant
financial and management resources.
Although we maintain comprehensive insurance to cover such liability claims arising
from clinical studies, it is possible that our liabilities could exceed our insurance coverage or
that our insurance will not cover all situations in which a claim against us could be made. We
may not be able to maintain insurance coverage at a reasonable cost or obtain insurance
coverage that will be adequate to satisfy any liability that may arise. If a successful product
liability claim or series of claims is brought against us for uninsured liabilities or in excess of
insured liabilities, our assets may not be sufficient to cover such claims and our business
operations could be impaired. Should any of these events occur, it could have a material
adverse effect on our business, financial condition and results of operations.
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Our information technology systems, or those used by our partners or other contractors
or consultants, may fail or suffer security breaches.
Despite the implementation of security measures, our information technology systems
and those of our CROs, consultants and other service providers are vulnerable to damage from
computer viruses, unauthorized access, cyber-attacks, natural disasters, terrorism, war and
telecommunication and electrical failures. If such an event were to occur and cause
interruptions in our operations, it could result in a material disruption of our research and
development programs. For example, our data may not be backed up in a timely manner and
the loss of clinical trial data from ongoing or future clinical trials for any of our drug
candidates could result in delays in regulatory approval efforts and significantly increase 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 data or applications, or inappropriate disclosure of confidential
or proprietary information, we could incur liability and the further development of our drug
candidates could be delayed.
Disruptions in the financial markets and economic conditions could affect our ability to
raise capital.
Global economies could suffer dramatic downturns as the result of a deterioration in the
credit markets and related financial crisis as well as a variety of other factors including,
extreme volatility in security prices, severely diminished liquidity and credit availability,
ratings downgrades of certain investments and declining valuations of others. In the past,
governments have taken unprecedented actions in an attempt to address and rectify these
extreme market and economic conditions by providing liquidity and stability to the financial
markets. If these actions are not successful, the return of adverse economic conditions may
cause a significant impact on our ability to raise capital, if needed, on a timely basis and on
acceptable terms.
In addition, concerns over the recent Russian-Ukraine conflict and the Palestinian-Israel
conflict, unrest and terrorist threats in the Middle East and other territories, among others, add
uncertainties to the financial markets worldwide. It is unclear whether these challenges and
uncertainties will be contained or resolved, and what effects they may have on the global
political and economic conditions in the long term. We are unable to predict all the risks and
uncertainties that we face as a result of current economic, political, social and regulatory
developments, and many of these risks are beyond our control. All such factors may materially
and adversely affect our business and operations as well as our financial performance.
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RISKS RELATING TO THE GLOBAL OFFERING
We may be required to be subject to filings with the CSRC for the listing and trading of
our Shares on the Stock Exchange.
On February 17, 2023, the CSRC released the Trial Administrative Measures of Overseas
Securities Offering and Listing by Domestic Companies ( ྤʫΆุྤ̮೯БᗇՎձɪ̹၍ଣ
) (the “ Trial Measures ”) and five supporting guidelines (collectively, the “ Trial
Measures and Supporting Guidelines ”), which came into effect on March 31, 2023. The Trial
Measures and Supporting Guidelines will regulate both direct and indirect overseas offering
and listing of PRC domestic companies’ securities by adopting a filing-based regulatory
regime. Pursuant to the Trial Measures and Supporting Guidelines, 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. The Trial
Measures and Supporting Guidelines also require subsequent reports to be filed with the CSRC
on material events, such as change of control or voluntary or forced delisting of the issuer(s)
who have completed overseas offerings and listings. Based on the foregoing, we are required
to comply with the filing procedure of the CSRC. We cannot assure you that we will be able
to complete filings procedures in connection with overseas offerings and listings on timely
basis. Any failure to complete filings procedures may have a material adverse effect on the
overseas offerings and listings.
There has been no prior public market for our Shares and there can be no assurance that
an active trading market for our Shares would develop, especially taking into account that
certain of our existing Shareholders may be subject to a lock-up period, and the market
price for our Shares may decline or became volatile.
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 and the Sponsor-Overall
Coordinator (for itself 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. 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 of the Shares will rise following the Global Offering.
In particular, certain part of the Shares in issue as of the date of this prospectus will be
subject to a lock-up period from the Listing Date, which may significantly affect the liquidity
and trade volume of our Shares in the short term following the Global Offering. A listing on
the Stock Exchange does not guarantee that an active and liquid trading market for our Shares
will develop, especially during the period when a certain portion of our Shares may be
subjected to lock-up, or if it does develop, that it will sustain following the Global Offering,
or that market price of the Shares will rise following the Global Offering.
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The price and trading volume of our Shares may be subject to significant volatility in
response to various factors beyond our control, including the general market conditions of the
securities in Hong Kong and elsewhere in the world. In particular, the business, results of
operations and the market price of the shares of other companies engaging in similar business
may affect the price and trading volume of our Shares. In addition to market and industry
factors, the price and trading volume of our Shares may be highly volatile for reasons specific
to our business, such as the results of clinical trials of our drug candidates, the results of our
applications for approval of our drug candidates, regulatory developments and healthcare
policies directly affecting us, fluctuations in our cash flows, investments and expenditures,
relationships with our suppliers, movements or activities of key personnel or actions taken by
competitors, among others. Moreover, shares of other biopharmaceutical companies listed on
the Stock Exchange have experienced price volatility in the past, and it is possible that our
Shares may be subject to changes in price not directly related to our performance.
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 of significant amounts of our Shares, by specific Shareholders subject
to certain regulatory requirements, 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.
Potential investors will incur immediate and significant dilution as a result of the Global
Offering.
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 and significant dilution in pro forma net tangible
assets, and our existing Shareholders will receive an increase in the pro forma adjusted net
tangible assets per Share on their Shares. As a result, if we were to distribute our net tangible
assets to the Shareholders immediately following the Global Offering, potential investors
would receive less than the amount they paid for their H Shares. In addition, holders of our H
Shares may experience a further dilution of their interest if the Sponsor-Overall Coordinator
(for itself and on behalf of the Underwriters) exercise the Over-allotment Option or if we issue
additional Shares in the future at a price lower than our net tangible asset value per Share at
the time of issuance. For details, please refer to “Unaudited Pro Forma Financial Information”
in Appendix II to this prospectus.
RISK FACTORS
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Raising additional capital may cause dilution to our Shareholders, restrict our operations
or require us to relinquish rights to our technologies or drug candidates.
We may finance our future cash needs through equity offerings, licensing arrangements
or other collaborations, government funding arrangements, debt financings, or any
combination thereof. In addition, we may seek additional capital due to favorable market
conditions or strategic considerations even if we believe that we have sufficient funds for our
current or future operating plans. To the extent that we raise additional capital through the sale
of equity or convertible debt securities, your ownership interest will be diluted, and the terms
may include liquidation or other preferences that adversely affect your rights as a holder of our
H Shares. The incurrence of additional indebtedness or the issuance of certain equity securities
could result in increased fixed payment obligations and could 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 license intellectual property rights and
other operating restrictions that could adversely impact our ability to conduct our business. In
addition, issuance of additional equity securities, or the possibility of such issuance, may cause
the market price of our H Shares to decline.
Our Controlling Shareholders have substantial control over our Company and their
interests may not be aligned with the interests of the other Shareholders.
Our Controlling Shareholders have substantial influence over our business, including
matters relating to our management, policies and decisions regarding acquisitions, mergers,
expansion plans, consolidations and sales of all or substantially all of our assets, election of
Directors and other significant corporate actions. Immediately after completion of the Global
Offering, assuming the Over-allotment Option is not exercised, our Controlling Shareholders
will hold approximately 55.89% of the issued share capital in our Company. This concentration
of ownership may discourage, delay or prevent a change in control of our Company, which
could deprive other Shareholders of an opportunity to receive a premium for their Shares as
part of a sale of our Company and might reduce the price of our Shares. These events may
occur even if they are opposed by our other Shareholders. In addition, the interests of our
Controlling Shareholders may differ from the interests of our other Shareholders. We cannot
assure you that our Controlling Shareholders will not exercise their substantial influence over
us and cause us to enter into transactions or take, or fail to take, actions or make decisions that
conflict with the best interests of our other Shareholders.
Because we do not expect to pay dividends in the foreseeable future after the Global
Offering, you must rely on price appreciation of our Shares for a return on your
investment.
Our Board has complete discretion as to whether to distribute 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.
RISK FACTORS
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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. For details, please refer to “Financial information —
Dividend” in this prospectus.
Facts, forecasts and statistics in this prospectus are derived from a third-party report and
government sources and may not be fully reliable.
Certain facts, forecasts and statistics in the prospectus relating to the pharmaceutical
industry in and outside China are obtained from various government sources we generally
believe to be reliable, and we cannot guarantee either the quality or reliability of such source
materials. We believe that the information originated from appropriate sources and was
extracted and reproduced after taking reasonable care. 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. However, neither we, the Sole Sponsor, the Sponsor-Overall
Coordinator, the Overall Coordinators, the Joint Global Coordinators nor our or their
respective affiliates or advisors have verified the facts, forecasts and statistics nor ascertained
the underlying economic assumptions relied upon in those facts, forecasts and statistics
obtained from these sources. Due to possibly flawed or ineffective collection methods or
discrepancies between published information and factual information and other problems, the
statistics in this prospectus relating to the pharmaceutical industry in and outside China may
be inaccurate, and you should not place undue reliance on it. We make no representation as to
the accuracy of such facts, forecasts and statistics obtained from various sources. Moreover,
these facts, forecasts and statistics involve risk and uncertainties and are subject to change
based on various factors and should not be unduly relied upon.
Forward-looking statements contained in this prospectus are subject to risks and
uncertainties.
This prospectus contains certain statements and information that are forward-looking and
uses forward-looking terminology such as “aim,” “anticipate,” “believe,” “could,” “expect,”
“estimate,” “goals,” “going forward,” “intend,” “may,” “might,” “objective,” “ought to,”
“outlook,” “plan,” “potential,” “predict,” “projection,” “schedule,” “seek,” “should,” “target,”
“vision,” “will,” “would” and other similar expressions. Y ou are cautioned that reliance on any
forward-looking statement involves risks and uncertainties and that any or all of those
assumptions could prove to be inaccurate and, as a result, the forward-looking statements based
on those assumptions could also be incorrect. In light of these and other risks and uncertainties,
the inclusion of forward-looking statements in this prospectus should not be regarded as
representations or warranties by us that our plans and objectives will be achieved, and these
forward-looking statements should be considered in light of various important factors,
including those set forth in this section. Subject to the requirements of the Listing Rules, we
do not intend publicly to update or otherwise revise the forward-looking statements in this
RISK FACTORS
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prospectus, whether as a result of new information, future events, or otherwise. Accordingly,
you should not place undue reliance on any forward-looking information. All forward-looking
statements in this prospectus are qualified by reference to this cautionary statement.
Y ou should read the entire prospectus 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.
Prior to the publication of this prospectus, there has been coverage in the media regarding
us and the Global Offering, which contained 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 any responsibility for the accuracy or completeness of such media coverage
or forward-looking statements.
We make no representation as to the appropriateness, accuracy, completeness or
reliability of any information disseminated in the media. We disclaim any information in the
media to the extent that such information is inconsistent or conflicts with the information
contained in this prospectus. Accordingly, prospective investors are cautioned to make their
investment decisions on the basis of the information contained in this prospectus only and
should not rely on any other information.
RISK FACTORS
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In preparation of the Global Offering, our Company has sought the following waivers
from strict compliance with the relevant provisions of the Listing Rules:
MANAGEMENT PRESENCE IN HONG KONG
Pursuant to Rules 8.12 and 19A.15 of the Listing Rules, an applicant applying for a
primary listing on the Stock Exchange must have a sufficient management presence in Hong
Kong and, under normal circumstances, at least two of the Company’s executive directors must
be ordinarily resident in Hong Kong.
Since our Group’s headquarters and principal place of business are located in the PRC,
most of the business operations of our Group are managed and conducted in Wuhan, the PRC,
and all of our executive Directors ordinarily reside outside Hong Kong, our Company considers
that it would be practically difficult and commercially unreasonable and undesirable for our
Company to arrange for two executive Directors to be ordinarily resident in Hong Kong, either
by means of relocation of existing executive Directors or appointment of additional executive
Directors. Our Company does not have and does not contemplate in the foreseeable future that
we will have sufficient management presence in Hong Kong for the purpose of satisfying the
requirement under Rules 8.12 and 19A.15 of the Listing Rules. Accordingly, we have applied
to the Stock Exchange for, and the Stock Exchange has granted, a waiver from strict
compliance with the requirements under Rules 8.12 and 19A.15 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 two authorized
representatives, who will act as the Company’s principal channel of communication
with the Stock Exchange. The two authorized representatives appointed are
Dr. Zhang, our Chairman and executive Director, and Mr. Li, our Company’s
company secretary. Each of them has confirmed that they can be readily contactable
by phone, facsimile and email to deal promptly with enquiries from the Stock
Exchange, and will also be available to meet with the Stock Exchange to discuss any
matter on short notice. Although Dr. Zhang resides in the PRC, he possesses valid
travel document to visit Hong Kong and is able to renew such travel document when
it expires. Mr. Li ordinarily resides in Hong Kong. As and when the Stock Exchange
wishes to contact the Directors on any matter, each of the authorized representatives
will have means to contact all of the Directors at all times. Our Company will also
inform the Stock Exchange promptly in respect of any change in the authorized
representatives;
(b) in addition to the appointment of the authorized representatives and pursuant to Rule
3.20 of the Listing Rules, to facilitate communication with the Stock Exchange, the
contact details of each Director, including his/her mobile phone number, office
number, facsimile number and e-mail address have been provided to each of the
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AND EXEMPTION FROM COMPLIANCE WITH THE COMPANIES
(WINDING UP AND MISCELLANEOUS PROVISIONS) ORDINANCE
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authorized representatives, our company secretaries, the Compliance Advisor (as
defined below) who have means to contact all Directors at all times as and when the
Stock Exchange wishes to contact the Directors on any matter and the Stock
Exchange. In the event that a Director expects to travel or is otherwise out of office,
he/she will endeavor to provide his/her phone number of the place of his/her
accommodation to the authorized representatives or maintain an open line of
communication via his/her mobile phone;
(c) furthermore, each Director who is not ordinarily resident in Hong Kong either
possesses or can apply for valid travel documents to visit Hong Kong and can meet
with the Stock Exchange within a reasonable period as and when required;
(d) pursuant to Rule 3A.19 of the Listing Rules, our Company has appointed Red Sun
Capital Limited as our compliance advisor (the “ Compliance Advisor ”) for the
period commencing from the date of our Listing until the date on which our
Company announces our financial results and distributes our annual report for the
first full financial year after the date of our Listing pursuant to the requirement
under Rule 13.46 of the Listing Rules. The Compliance Advisor will act as our
Company’s additional and alternative channel of communication with the Stock
Exchange, and its representatives will be readily available to answer enquiries from
the Stock Exchange;
(e) in addition to the Compliance Advisor’s role and responsibilities after the Listing to
provide advice to our Company on the continuing obligations under the Listing
Rules and applicable laws and regulations, our Company will retain other
professional advisers (including legal advisers and accountants) to (i) inform our
Company in a timely manner of any amendment or supplement to the Listing Rules
and any new or amended laws, regulations or codes in Hong Kong applicable to our
Company; (ii) to provide advice to our Company on the continuing requirements
under the Listing Rules and applicable Hong Kong laws and regulations; and (iii) to
provide advice to our Company on the application of the Listing Rules and other
applicable Hong Kong laws and regulations relating to our Company after the
Listing; and
(f) meetings between the Stock Exchange and our Directors could be arranged through
the Company’s authorized representatives or the Compliance Advisor, or directly
with the Directors within a reasonable time frame. The Company will promptly
inform the Stock Exchange of any changes of the Company’s authorized
representatives and/or the Compliance Advisor.
W AIVERS FROM STRICT COMPLIANCE WITH THE LISTING RULES
AND EXEMPTION FROM COMPLIANCE WITH THE COMPANIES
(WINDING UP AND MISCELLANEOUS PROVISIONS) ORDINANCE
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JOINT COMPANY SECRETARIES
Rule 8.17 of the Listing Rules provides that we must appoint a company secretary who
satisfies Rule 3.28 of the Listing Rules. Rule 3.28 of the Listing Rules provides that our
company secretary must be a person who, by virtue of his or her academic or professional
qualifications or relevant experience, is, in the opinion of the Stock Exchange, capable of
discharging the functions of a company secretary.
Pursuant to Note 1 to Rule 3.28 of the Listing Rules, and the Chapter 3.10 of the Guide,
the Stock Exchange considers the following academic or professional qualifications to be
acceptable:
(a) a member of The Hong Kong Chartered Governance Institute;
(b) a solicitor or barrister (as defined in the Legal Practitioners Ordinance (Chapter 159
of the Laws of Hong Kong)); and
(c) a certified public accountant (as defined in the Professional Accountants Ordinance
(Chapter 50 of the Laws of Hong Kong)).
Pursuant to Note 2 to Rule 3.28 of the Listing Rules, and the Chapter 3.10 of the Guide,
in assessing “relevant experience”, the Stock Exchange will consider the following of the
individual:
(a) length of employment with the issuer and other issuers and the roles he or she has
played;
(b) familiarity with the Listing Rules and other relevant laws and regulations including
the SFO, the Companies Ordinance, the Companies (Winding Up and Miscellaneous
Provisions) Ordinance and the Takeovers Code;
(c) relevant training taken and/or to be taken in addition to be the minimum requirement
under Rule 3.29 of the Listing Rules; and
(d) professional qualifications in other jurisdictions.
Our Company considers that while it is important for the company secretary to be familiar
with the relevant securities regulation in Hong Kong, he/she also needs to have experience
relevant to our Company’s operations, nexus to the Board and close working relationship with
the management of our Company in order to perform the function of a company secretary and
to take the necessary actions in the most effective and efficient manner. It is for the benefit of
our Company to appoint a person who has been a member of the senior management for a
period of time and is familiar with our Company’s business and affairs as company secretary.
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AND EXEMPTION FROM COMPLIANCE WITH THE COMPANIES
(WINDING UP AND MISCELLANEOUS PROVISIONS) ORDINANCE
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We have appointed Mr. Zhang Hui, our chief financial officer, and Mr. Li as the joint
company secretaries of our Company. Mr. Li is a Chartered Secretary and an Associate of both
The Hong Kong Charted Governance Institute and The Chartered Governance Institute in the
United Kingdom, therefore meets the qualification requirements under Note to Rule 3.28 of the
Listing Rules and is in compliance with Rule 8.17 of the Listing Rules. Mr. Zhang Hui,
however, does not possess the qualifications set out in Rule 3.28 of the Listing Rules. We
believe that Mr. Zhang Hui, by virtue of his knowledge and experience in handling financial
management and corporate development matters, is capable of discharging his functions as a
joint company secretary. For more details of Mr. Zhang Hui and Mr. Li’s biographical
information, see “Directors, Supervisors and Senior Management” in this prospectus.
We have therefore applied to the Stock Exchange for, and the Stock Exchange has granted
us, a waiver from strict compliance with the requirements under Rules 3.28 and 8.17 of the
Listing Rules on the conditions that: (i) Mr. Zhang Hui must be assisted by Mr. Li, who
possesses the qualifications or experience as required under Rule 3.28 of the Listing Rules and
is appointed as a joint company secretary throughout the waiver period; (ii) the waiver can be
revoked if there are material breaches of the Listing Rules by our Company; and (iii) before
the end of the three-year period, our Company must demonstrate and seek the Stock
Exchange’s confirmation that Mr. Zhang Hui (i.e. the proposed company secretary not
fulfilling the requirement under Rule 3.28), having had the benefit of Mr. Li’s (i.e. the qualified
person) assistance during the three-year period, has attained the relevance experience under
note to Rule 3.28 and is capable of discharging the functions of company secretary so that a
further waiver would not be necessary. We expect that Mr. Zhang Hui will acquire the
qualifications or relevant experience required under Rule 3.28 of the Listing Rules prior to the
end of the three-year period after the Listing. We will liaise with the Stock Exchange before
the end of the three-year period to enable it to assess whether Mr. Zhang Hui, having had the
benefit of Mr. Li’s assistance for three years and has acquired relevant experience within the
meaning of Rule 3.28 of the Listing Rules so that a further waiver will not be necessary.
EXEMPTION FROM STRICT COMPLIANCE WITH SECTION 342(1) OF THE
COMPANIES (WINDING UP AND MISCELLANEOUS PROVISIONS) ORDINANCE 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
According to section 342(1)(b) of the Companies (Winding Up and Miscellaneous
Provisions) Ordinance, the prospectus shall include the matters specified in Part I of the Third
Schedule thereto and the reports specified in Part II of the Third Schedule thereto.
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AND EXEMPTION FROM COMPLIANCE WITH THE COMPANIES
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According 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 as well as an explanation of the method used for the computation of such income
or turnover and a reasonable breakdown of the more important trading activities. According 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 its prospectus a
report prepared by our Company’s auditor with respect to the profits and losses and assets and
liabilities of our Company for each of the three financial years immediately preceding the issue
of the prospectus.
According to section 342A(1) 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.
According to Rule 4.04(1) of the Listing Rules, the accountant’s report contained in the
prospectus must include, among others, the results of the company in respect of each of the
three financial years immediately preceding the issue of the prospectus or such shorter period
as may be acceptable to the Stock Exchange.
According to Rule 18A.06 of the Listing Rules, an eligible biotech company shall comply
with Rule 4.04 of the Listing Rules modified so that references to “three financial years” or
“three years” in that rule shall instead reference to “two financial years” or “two years,” as the
case may be.
Accordingly, we have applied to the SFC for, and the SFC has granted, a certificate of
exemption from strict compliance with the requirements under section 342(1)(b) of the
Companies (Winding Up and Miscellaneous Provisions) Ordinance 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, on the conditions that the particulars of the exemption
are set forth in this prospectus and this prospectus will be issued on or before December 15,
2025, on the following grounds:
(a) we are a clinical-stage biopharmaceutical company dedicated to the development of
immuno-oncology program, and falls within the scope of biotech company as
defined under Chapter 18A of the Listing Rules;
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AND EXEMPTION FROM COMPLIANCE WITH THE COMPANIES
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(b) the Accountants’ Report for the years ended December 31, 2023 and 2024 and the
eight months ended August 31, 2025 has been prepared and is set out in Appendix
I to this prospectus in accordance with Rule 18A.06 of the Listing Rules;
(c) we are a pre-revenue biotech company and during the Track Record Period, we did
not generate any revenue from our drug candidates under development, and we will
continue to incur significant research and development and other expenses related to
our ongoing operations. For details of our major activities, see “Business” in this
prospectus;
(d) notwithstanding that the financial results set out in this prospectus are only for the
years ended December 31, 2023 and 2024 and the eight months ended August 31,
2025, other information required to be disclosed under the Listing Rules and the
Companies (Winding Up and Miscellaneous Provisions) Ordinance has been
adequately disclosed in this prospectus pursuant to the relevant requirements;
(e) given that Chapter 18A of the Listing Rules provides that the minimum track record
period for biotech companies in terms of financial disclosure is two years, strict
compliance with the requirements of section 342(1) of the Companies (Winding Up
and Miscellaneous Provisions) Ordinance and 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 unnecessary and/or irrelevant for
our Company;
(f) our Directors and the Sole Sponsor confirm that after performing all due diligence
work which they consider appropriate, up to the date of this prospectus, there has
been no material adverse change to the financial and trading positions or prospects
of our Company since August 31, 2025 (immediately following the date of the latest
audited statement of financial position in the Accountants’ Report set out in
Appendix I to this prospectus) to the date of this prospectus and there has been no
event which would materially affect the information shown in the Accountants’
Report as set out in Appendix I and the section headed “Financial Information” in
this prospectus and other parts of the prospectus; and
(g) our Directors are of the view that the Accountants’ Report covering the years ended
December 31, 2023 and 2024 and the eight months ended August 31, 2025 included
in this prospectus, together with other disclosure in this prospectus, have 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 our Company,
and our Directors confirm that all information which is necessary for the investing
public to make an informed assessment of our Group’s business, assets and
liabilities, financial position, trading position, management and prospects has been
included in this prospectus. Therefore, the exemption would not prejudice the
interest of the investing public.
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AND EXEMPTION FROM COMPLIANCE WITH THE COMPANIES
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CONSENT IN RESPECT OF THE PROPOSED SUBSCRIPTION OF H SHARES BY A
CONNECTED CLIENT
Guotai Junan Investments (Hong Kong) Limited (in connection with the Kunyang OTC
Swaps)
Paragraph 1C(1) of Appendix F1 to the Listing Rules (the “Placing Guidelines”) provides
that no allocations will be permitted to “connected clients” of the overall coordinator(s), any
syndicate member(s) (other than the overall coordinator(s)) or any distributor(s) (other than
syndicate member(s)), without the prior written consent of the Stock Exchange. Paragraph
1B(7) of the Placing Guidelines provides that “connected client” in relation to an exchange
participant includes any client which is a member of the same group of companies as such
exchange participant.
Guotai Junan Investments (Hong Kong) Limited (“GTINV”) and Guotai Haitong
Securities Co., Ltd. (“GTHT”) will enter into a series of cross border delta-one OTC swap
transactions (the “Kunyang OTC Swaps”) with each other and with Kunyang New Pattern No.
1 Private Securities Investment Fund (҅1ږthe “GTHT Ultimate
Client (Kunyang)”), pursuant to which GTINV will hold the Offer Shares on a non-
discretionary basis to hedge the Kunyang OTC Swaps while the economic risks and returns of
the underlying Offer Shares are passed to the GTHT Ultimate Client (Kunyang), subject to
customary fees and commissions. The Kunyang OTC Swaps will be fully funded by the GTHT
Ultimate Client (Kunyang). During the terms of the Kunyang OTC Swaps, all economic returns
of the Offer Shares subscribed by GTINV will be passed to the GTHT Ultimate Client
(Kunyang) and all economic loss shall be borne by the GTHT Ultimate Client (Kunyang)
through the Kunyang OTC Swaps, and GTINV will not take part in any economic return or bear
any economic loss in relation to the Offer Shares. Despite GTINV holding the legal title to the
Offer Shares, it will not exercise the voting rights attaching to the relevant Offer Shares during
the terms of the Kunyang OTC Swaps according to its internal policy.
Haitong International Securities Company Limited (“Haitong International Securities”) is
one of the Overall Coordinators, Joint Global Coordinators, Joint Bookrunners, Joint Lead
Managers and the Underwriters of the Global Offering. GTINV and Haitong International
Securities are indirectly wholly-owned subsidiaries of GTHT. Accordingly, GTINV is a
connected client of Haitong International Securities for the purpose of the Placing Guidelines.
We have applied for, and the Stock Exchange has granted, its consent under paragraph
1C(1) of the Placing Guidelines to allow GTINV to subscribe for Offer Shares as a Cornerstone
Investor on the following basis and conditions, consistent with paragraph 6 of Chapter 4.15 of
the Guide for New Listing Applicants:
(a) any Offer Shares to be allocated to GTINV will be held on behalf of independent
third parties and details of the allocation will be disclosed in the allotment results
announcement;
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(b) the cornerstone investment agreement with GTINV does not contain any material
terms which are more favourable to GTINV than those in the other cornerstone
investment agreements;
(c) no preferential treatment has been, nor will be, given to GTINV by virtue of its
relationship with Haitong International Securities in any allocation of Offer Shares
in the International Offering, other than the assured entitlement under the relevant
cornerstone investment agreement;
(d) the Overall Coordinators have provided the Stock Exchange with the identities of
the ultimate beneficial owner(s) of the Offer Shares to be held through the Kunyang
OTC Swaps and, where applicable, details of the Kunyang OTC Swaps under which
the subscription by GTINV is made; and
(e) details of the cornerstone investment by GTINV and the allocation of the Offer
Shares to it will be disclosed in the section headed “Cornerstone Investors” in this
prospectus and in the allotment results announcement.
TFI Investment Fund SPC (acting for and on behalf of its segregated portfolio, TFI
Lakeside SP)
TFI Lakeside SP (the “TFI Fund”) is a segregated portfolio of TFI Investment Fund SPC,
an exempted company incorporated under the laws of the Cayman Islands and registered as a
segregated portfolio company and is an Independent Third Party. 100% of the management
shares of TFI Investment Fund SPC are held by TFI Asset Management (Cayman) Ltd. The
investment manager of the TFI Fund is TFI Asset Management Limited. Both TFI Asset
Management (Cayman) Ltd. and TFI Asset Management Limited are indirectly wholly owned
by Tianfeng Securities Co., Ltd. (a company listed on the Shanghai Stock Exchange (stock
code: 601162)). TFI Asset Management Limited is a company incorporated in Hong Kong and
licensed by the SFC to carry out Type 4 (advising on securities), Type 5 (advising on futures
contracts) and Type 9 (asset management) regulated activities under the SFO in Hong Kong by
the SFC. No single participating investor holds 30% or more interests in the TFI Fund.
TFI Securities and Futures Limited (“TFI Securities”) is one of the Joint Global
Coordinators, Joint Bookrunners, Joint Lead Managers and the Underwriters of the Global
Offering. As TFI Securities is also wholly owned by Tianfeng Securities, TFI Investment Fund
SPC is a connected client of TFI Securities for the purpose of the Placing Guidelines.
TFI Investment Fund SPC (acting for and on behalf of its segregated portfolio, TFI
Lakeside SP) intends to subscribe for Offer Shares as a Cornerstone Investor under the
International Offering pursuant to a cornerstone investment agreement with the Company (the
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“TFI Cornerstone Investment Agreement”). TFI Investment Fund SPC (acting for and on behalf
of its segregated portfolio, TFI Lakeside SP) will hold the Offer Shares on a discretionary basis
for and on behalf of its underlying clients and accounts, all of whom are independent third
parties.
We have applied for, and the Stock Exchange has granted, its consent under paragraph
1C(1) of the Placing Guidelines to allow TFI Investment Fund SPC to subscribe for Offer
Shares as a Cornerstone Investor as a connected client of TFI Securities on the following basis
and conditions as required under paragraph 6 of Chapter 4.15 of the Guide for New Listing
Applicants:
(a) any Offer Shares to be allocated to TFI Investment Fund SPC (acting for and on
behalf of its segregated portfolio, TFI Lakeside SP) will be held on behalf of
independent third parties and details of the allocation will be disclosed in the
allotment results announcement;
(b) the TFI Cornerstone Investment Agreement does not contain any material term
which is more favourable to TFI Investment Fund SPC (acting for and on behalf of
its segregated portfolio, TFI Lakeside SP) than those in the other cornerstone
investment agreements;
(c) no preferential treatment has been, nor will be, given to TFI Investment Fund SPC
(acting for and on behalf of its segregated portfolio, TFI Lakeside SP), Associates
and subsidiaries of TFI Securities by virtue of their relationships with TFI Securities
in any allocation of Offer Shares in the International Offering, other than the assured
entitlement under the TFI Cornerstone Investment Agreement;
(d) TFI Securities has not participated and will not participate in the decision-making
process or relevant discussions relating to allocation of securities to TFI Investment
Fund SPC (acting for and on behalf of its segregated portfolio, TFI Lakeside SP),
or other Associates and subsidiaries of TFI Securities;
(e) the Overall Coordinators have provided the Stock Exchange with the background
and details of TFI Investment Fund SPC — TFI Lakeside SP as a collective
investment scheme not authorized by the SFC;
(f) each of the Company, the Overall Coordinators, TFI Securities and TFI Investment
Fund SPC (acting for and on behalf of its segregated portfolio, TFI Lakeside SP) has
provided the Stock Exchange with written confirmations in accordance with Chapter
4.15 of the Guide for New Listing Applicants; and
(g) details of the cornerstone investment by TFI Investment Fund SPC (acting for and
on behalf of its segregated portfolio, TFI Lakeside SP) and the allocation of Offer
Shares to it will be disclosed in the section headed “Cornerstone Investors” in this
prospectus and in the allotment results announcement.
W AIVERS FROM STRICT COMPLIANCE WITH THE LISTING RULES
AND EXEMPTION FROM COMPLIANCE WITH THE COMPANIES
(WINDING UP AND MISCELLANEOUS PROVISIONS) ORDINANCE
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DIRECTORS’ RESPONSIBILITY STATEMENT
This prospectus, for which our Directors (including any proposed director named as such
in this prospectus) 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 to the public with
regard to our Group. Our Directors, having made all reasonable enquiries, confirm that to the
best of their knowledge and belief, the information contained in this prospectus is accurate and
complete in all material aspects and not misleading or deceptive, and there are no other matters
the omission of which would make any statement in this prospectus misleading.
CSRC FILING
We submitted a filing to the CSRC to apply for the Global Offering and listing of the H
Shares on the Stock Exchange on November 26, 2024. The CSRC issued the notification on
completion of filing on November 12, 2025. As advised by our PRC Legal Adviser, our
Company has completed all necessary filings with the CSRC and no other approvals from the
CSRC are required to be obtained for the listing of the H Shares on the Stock Exchange.
INFORMATION ON THE GLOBAL OFFERING
This prospectus 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 prospectus sets out the terms and conditions of the Hong Kong Public Offering. The Global
Offering comprises the Hong Kong Public Offering of initially 1,832,100 Offer Shares and the
International Offering of initially 16,488,900 Offer Shares (subject, in each, to reallocation on
the basis as set out in the section headed “Structure of the Global Offering” in this prospectus).
The Hong Kong Offer Shares are offered solely on the basis of the information contained
and representations made in this prospectus and on the terms and subject to the conditions set
out in this prospectus. No person is authorized to give any information in connection with the
Global Offering or to make any representation not contained in this prospectus, and any
information or representation not contained herein must not be relied upon as having been
authorized by our Company, the Sole Sponsor, the Sponsor-Overall Coordinator, the Overall
Coordinators, the Joint Global Coordinators, the Joint Bookrunners, the Joint Lead Managers,
the Capital Market Intermediaries, the Underwriters and any of their respective directors,
officers, partners, agents, employees or advisers or any other party (collectively, the “ Relevant
Persons ”) involved in the Global Offering.
The Listing is sponsored by the Sole Sponsor and the Global Offering is managed by the
Overall Coordinators. The Hong Kong Public Offering is fully underwritten by the Hong Kong
Underwriters subject to the terms and conditions of the Hong Kong Underwriting Agreement.
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.
INFORMATION ABOUT THIS PROSPECTUS AND THE GLOBAL OFFERING
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The Offer Price is expected to be determined between the Sponsor-Overall Coordinator
(for itself and on behalf of the Underwriters) and our Company on the Price Determination
Date. The Price Determination Date is expected to be on or around Friday, December 19, 2025
and, in any event, not later than 12:00 noon on Friday, December 19, 2025 (unless otherwise
determined between the Sponsor-Overall Coordinator (for itself and on behalf of the
Underwriters) and our Company). If, for any reason, the Offer Price is not agreed among us and
the Sponsor-Overall Coordinator (for itself and on behalf of the Underwriters), the Global
Offering will not proceed and will lapse. For full information about the Underwriters and the
underwriting arrangements, please refer to the section headed “Underwriting” in this
prospectus.
Neither the delivery of this prospectus nor any subscription or acquisition made under it
shall, 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
prospectus or imply that the information contained in this prospectus is correct as of any date
subsequent to the date of this prospectus.
PROCEDURES FOR APPLICATION FOR THE HONG KONG OFFER SHARES
The procedures for applying for the Hong Kong Offer Shares are set forth in the section
headed “How to Apply for Hong Kong Offer Shares” in this prospectus.
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” in this prospectus.
RESTRICTIONS ON OFFER AND SALE OF THE OFFER SHARES
Each person acquiring the Hong Kong Offer Shares under the Hong Kong Public Offering
will be required to, or be deemed by his/her acquisition of Offer Shares to, confirm that he/she
is aware of the restrictions on offers and sale of the Offer Shares described in this prospectus.
No action has been taken to permit a public offering of the Offer Shares or the general
distribution of this prospectus in any jurisdiction other than in Hong Kong. Accordingly, this
prospectus 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 prospectus and the offering and sale 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. In particular, the Offer Shares have
not been offered and sold, and will not be offered and sold, directly or indirectly in the US or
the PRC.
INFORMATION ABOUT THIS PROSPECTUS AND THE GLOBAL OFFERING
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APPLICATION FOR LISTING OF THE H SHARES ON THE STOCK EXCHANGE
We have applied to the Listing Committee of the Stock Exchange for the granting of the
listing of, and permission to deal in, (a) the H Shares to be issued pursuant to the Global
Offering; and (b) the H Shares to be converted from the Unlisted Shares.
No part of our Shares or loan capital is listed or dealt in on any other stock exchange and
no such listing or permission to list is being or proposed to be sought on any other stock
exchange as of the date of this prospectus or in the near future.
Under section 44B(1) of the Companies (Winding Up and Miscellaneous Provisions)
Ordinance, any allotment made in respect of any application will be invalid if the listing of,
and permission to deal in, the H Shares on the Stock Exchange is refused before the expiration
of three weeks from the date of the closing of the application lists, or such longer period (not
exceeding six weeks) as may, within the said three weeks, be notified to the Company by or
on behalf of the Stock Exchange.
COMMENCEMENT OF DEALINGS IN THE H SHARES
Dealings in the H Shares on the Stock Exchange are expected to commence on Tuesday,
December 23, 2025. The H Shares will be traded in board lots of 100 H Shares each. The stock
code of the H Shares will be 3378.
H SHARES WILL BE ELIGIBLE FOR ADMISSION INTO CCASS
If the Stock Exchange grants the listing of, and permission to deal in, the H Shares on the
Stock Exchange and we comply with the stock admission requirements of HKSCC, the H
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 HKSCC
Operational Procedures in effect from time to time. Investors should seek the advice of their
stockbroker or other professional advisors for details of the settlement arrangement as such
arrangements may affect their rights and interests.
All necessary arrangements have been made to enable the H Shares to be admitted into
CCASS.
INFORMATION ABOUT THIS PROSPECTUS AND THE GLOBAL OFFERING
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--- page 130 ---
PROFESSIONAL TAX ADVICE RECOMMENDED
Y ou should consult your professional advisors if you are in any doubt as to the taxation
implications of subscribing for, purchasing, holding or disposing of, or dealing in, the H Shares
or exercising any rights attaching to the H Shares. We emphasise that none of us, the Relevant
Persons, 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 H Shares or your
exercise of any rights attaching to the H Shares.
H SHARE REGISTER OF MEMBERS AND STAMP DUTY
All of the Offer Shares issued pursuant to applications made in the Hong Kong Public
Offering and the International Offering will be registered on our H Share register of members
to be maintained in Hong Kong by our H Share Registrar, Tricor Investor Services Limited at
17/F, Far East Finance Centre, 16 Harcourt Road, Hong Kong. Our principal register of
members will be maintained at our current registered office in the PRC.
Dealings in the H Shares registered in our H Share register of members will be subject
to Hong Kong stamp duty. For further details on Hong Kong stamp duty, please seek
professional tax advice.
Unless determined otherwise by our Company, dividends payable in respect of our H
Shares will be paid to the Shareholders listed on the H Share register of members of our
Company in Hong Kong, by ordinary post, at the Shareholders’ risk, to the registered address
of each Shareholder of our Company.
EXCHANGE RATE CONVERSION
Solely for your convenience, this prospectus contains translations among certain amounts
denominated in Renminbi, Hong Kong dollars and U.S. dollars.
Unless otherwise specified, amounts denominated in Hong Kong dollars and Renminbi
have been translated, for the purpose of illustration only, into United States dollars in this
prospectus at the following exchange rates:
HK$1.00:RMB0.90919
US$1.00:HK$7.7832
US$1.00:RMB7.0764
No representation is made that the amounts denominated in Renminbi, Hong Kong dollars
and 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.
INFORMATION ABOUT THIS PROSPECTUS AND THE GLOBAL OFFERING
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LANGUAGE
If there is any inconsistency between the English version of this prospectus and the
Chinese translation of this prospectus, the English version of this prospectus shall prevail
unless otherwise stated. However, if there is any inconsistency between the names of any of
the entities mentioned in the English version of this prospectus which are not in the English
language and their English translations, the names in their respective original language shall
prevail.
ROUNDING
Certain amounts and percentage figures included in this prospectus have been subject to
rounding adjustments, or have rounded to a set number of decimal places. Accordingly, figures
shown as totals in certain tables or charts may not be an arithmetic aggregation of the figures
preceding them. Any discrepancies in any table, chart or elsewhere between totals and sums of
amounts listed therein are due to rounding.
INFORMATION ABOUT THIS PROSPECTUS AND THE GLOBAL OFFERING
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--- page 132 ---
DIRECTORS
Name Address Nationality
Executive Directors
Dr. Zhang Faming (׼Unit 601 Unit 1, Block 42
Hengda Huafu
No. 22 Luoyu East Road
Wuhan East Lake New Technology
Development Area
Wuhan, Hubei
PRC
American
Dr. Henry Qixiang Li ( ҽՉജ) 3561 V oyager Ct.
Oceanside
California
USA
American
Mr. Liu Min ( ᄎઽ) Unit 4-1-504, Lidao 2046
Xiongchu Avenue
Hongshan District
Wuhan, Hubei
PRC
Chinese
Non-executive Directors
Dr. Li Jian ( ҽ਄) Unit 202 Building 18
No. 24 Wenhua Road
Taishan District
Taian, Shandong
PRC
Chinese
Ms. Xiao Jieyu ( ӽẘѹ) Unit 202, Unit 1, Building 9
Hailun Chuntian
Phase I
44R2 Block, Sixin South Road
Zhuankou Development District
Wuhan, Hubei
PRC
Chinese
Independent non-executive Directors
Dr. Bi Honggang (፻) Unit 202 Building 12 Green Court 2
No. 650 Bi Y un Road
Pudong New Area
Shanghai
PRC
American
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
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--- page 133 ---
Name Address Nationality
Mr. Chen Qifeng (ࢤUnit 902 Unit 2 Building 20
Xindi Dongfang Mingzhu
Wanlong 5th Road
Xingfu Avenue
Jiangan District
Wuhan, Hubei
PRC
Chinese
Mr. Wong Sai Hung ( ˮ˰ඪ) Flat D 6/F Block 4
City Garden
233 Electric Road
North Point
Hong Kong
Chinese
(Hong Kong)
Dr. Zhang Qiongguang
(ੵᖘΈ)
Unit 816, Building 7
Ketai Apartment
Kegu Third Street
Tongzhou District
Beijing
PRC
Chinese
SUPERVISORS
Name Address Nationality
Dr. Ke Hang (ঘ) Unit 202 Building 3 Block 3
No. 21 Zhongnan Road
Wuchang District
Wuhan, Hubei
PRC
Chinese
Ms. Sun Peng (ᘄ) Unit 1002, No. 138, Lane 1688
Landian Road, Zhoupu Town
Pudong New Area
Shanghai
PRC
Chinese
Ms. Chen Chen ( ௓ો) Unit 307, Building E9
Talent Apartment
Guanggu 3rd Road
Hongshan District
Wuhan, Hubei
PRC
Chinese
For details of the biographies and other relevant information of the Directors and
Supervisors, please refer to “Directors, Supervisors and Senior Management” in this
prospectus.
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
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--- page 134 ---
PARTIES INVOLVED IN THE GLOBAL OFFERING
Sole Sponsor ICBC International Capital Limited
37/F, ICBC Tower
3 Garden Road
Hong Kong
Sponsor-Overall Coordinator ICBC International Securities Limited
37/F, ICBC Tower
3 Garden Road
Hong Kong
Overall Coordinators China Securities (International)
Corporate Finance Company Limited
18/F, Two Exchange Square
8 Connaught Place
Central
Hong Kong
China Merchants Securities (HK)
Co., Limited
48/F, One Exchange Square
Central
Hong Kong
Haitong International Securities
Company Limited
30/F, Suites 3001-10 and 3015-16
One International Finance Centre
No. 1 Harbour View Street
Central
Hong Kong
CCB International Capital Limited
12/F, CCB Tower
3 Connaught Road Central
Central
Hong Kong
Joint Global Coordinators ICBC International Securities Limited
37/F, ICBC Tower
3 Garden Road
Hong Kong
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
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--- page 135 ---
China Securities (International)
Corporate Finance Company Limited
18/F, Two Exchange Square
8 Connaught Place
Central
Hong Kong
China Merchants Securities (HK)
Co., Limited
48/F, One Exchange Square
Central
Hong Kong
Haitong International Securities
Company Limited
30/F, Suites 3001-10 and 3015-16
One International Finance Centre
No. 1 Harbour View Street
Central
Hong Kong
CCB International Capital Limited
12/F, CCB Tower
3 Connaught Road Central
Central
Hong Kong
TFI Securities and Futures Limited
16/F, Two Pacific Place
88 Queensway
Admiralty
Hong Kong
ABCI Capital Limited
11/F, Agricultural Bank of China Tower
50 Connaught Road Central
Hong Kong
SPDB International Capital Limited
33/F, SPD Bank Tower
One Hennessy
1 Hennessy Road
Hong Kong
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
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--- page 136 ---
Joint Bookrunners ICBC International Securities Limited
37/F, ICBC Tower
3 Garden Road
Hong Kong
China Securities (International)
Corporate Finance Company Limited
18/F, Two Exchange Square
8 Connaught Place
Central
Hong Kong
China Merchants Securities (HK)
Co., Limited
48/F, One Exchange Square
Central
Hong Kong
Haitong International Securities
Company Limited
30/F, Suites 3001-10 and 3015-16
One International Finance Centre
No. 1 Harbour View Street
Central
Hong Kong
CCB International Capital Limited
12/F, CCB Tower
3 Connaught Road Central
Central
Hong Kong
TFI Securities and Futures Limited
16/F, Two Pacific Place
88 Queensway
Admiralty
Hong Kong
ABCI Capital Limited
11/F, Agricultural Bank of China Tower
50 Connaught Road Central
Hong Kong
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
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--- page 137 ---
SPDB International Capital Limited
33/F, SPD Bank Tower
One Hennessy
1 Hennessy Road
Hong Kong
Livermore Holdings Limited
Unit 1214A, 12/F
Tower II Cheung Sha Wan Plaza
833 Cheung Sha Wan Road
Kowloon
Hong Kong
Tiger Brokers (HK) Global Limited
23/F, Li Po Chun Chambers
189 Des V oeux Road Central
Hong Kong
Shanxi Securities International Limited
Unit A, 29/F, Tower 1
Admiralty Center
18 Harcourt Road
Admiralty
Hong Kong
Beta International Securities Limited
Room 3326, 33/F, China Merchants Tower
Shun Tak Centre
168-200 Connaught Road Central
Sheung Wan
Hong Kong
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
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--- page 138 ---
Joint Lead Managers ICBC International Securities Limited
37/F, ICBC Tower
3 Garden Road
Hong Kong
China Securities (International)
Corporate Finance Company Limited
18/F, Two Exchange Square
8 Connaught Place
Central
Hong Kong
China Merchants Securities (HK)
Co., Limited
48/F, One Exchange Square
Central
Hong Kong
Haitong International Securities
Company Limited
30/F, Suites 3001-10 and 3015-16
One International Finance Centre
No. 1 Harbour View Street
Central
Hong Kong
CCB International Capital Limited
12/F, CCB Tower
3 Connaught Road Central
Central
Hong Kong
TFI Securities and Futures Limited
16/F, Two Pacific Place
88 Queensway
Admiralty
Hong Kong
ABCI Securities Company Limited
10/F, Agricultural Bank of China Tower
50 Connaught Road Central
Hong Kong
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
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--- page 139 ---
SPDB International Capital Limited
33/F, SPD Bank Tower
One Hennessy
1 Hennessy Road
Hong Kong
Livermore Holdings Limited
Unit 1214A, 12/F
Tower II Cheung Sha Wan Plaza
833 Cheung Sha Wan Road
Kowloon
Hong Kong
Tiger Brokers (HK) Global Limited
23/F, Li Po Chun Chambers
189 Des V oeux Road Central
Hong Kong
Shanxi Securities International Limited
Unit A, 29/F, Tower 1
Admiralty Center
18 Harcourt Road
Admiralty
Hong Kong
Beta International Securities Limited
Room 3326, 33/F, China Merchants Tower
Shun Tak Centre
168-200 Connaught Road Central
Sheung Wan
Hong Kong
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
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--- page 140 ---
Legal advisers to the Company As to Hong Kong Law:
Jingtian & Gongcheng LLP
Suite 3203-3209, 32/F, Edinburgh Tower
The Landmark
15 Queen’s Road Central
Hong Kong
As to the PRC law:
Jingtian & Gongcheng
34/F, Tower 3
China Central Place
77 Jianguo Road
Beijing
PRC
Legal advisers to the Sole Sponsor and
the Underwriters
As to Hong Kong Law:
Ashurst Hong Kong
43/F, Jardine House
1 Connaught Place
Central
Hong Kong
As to the PRC law:
Commerce & Finance Law Offices
12-15/F, China World Office 2
No. 1 Jianguomenwai Avenue
Beijing
PRC
Auditor and Reporting Accountants Ernst & Y oung
Certified Public Accountants and Registered
Public Interest Entity Auditor
27/F, One Taikoo Place
979 King’s Road
Quarry Bay
Hong Kong
Industry consultant Frost & Sullivan (Beijing) Inc., Shanghai
Branch Co.
Suite 2504, Wheelock Square
1717 Nanjing West Road
Shanghai
PRC
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
– 129 –


--- page 141 ---
Registered address, head office and
principal place of business in the PRC
Building A8, Phase II
Bio-Innovation Park
No. 1 Jiufeng 1st Road
East Lake New Technology Development Zone
Wuhan, Hubei
PRC
Principal place of business in Hong Kong 3/F, Building 2W
Science Park Avenue
Hong Kong Science Park
Shatin
New Territories
Hong Kong
Company website http://www.hanxbio.com
(information contained in the website does
not form part of this prospectus)
Joint company secretaries Mr. Li Kin Wai (۾)
ACG, HKACG)
Room 1918, 19/F
Lee Garden One
33 Hysan Avenue
Causeway Bay
Hong Kong
Mr. Zhang Hui ( ੵሾ)
Unit 2704 E8 Building
Talent Apartment
Optics V alley Biotech City
Hongshan District
Wuhan, Hubei
PRC
Authorized representatives Dr. Zhang Faming (׼)
Unit 601 Unit 1, Block 42
Hengda Huafu
No. 22 Luoyu East Road
Wuhan East Lake New Technology
Development Area
Wuhan, Hubei
PRC
Mr. Li Kin Wai (۾)
ACG, HKACG)
Room 1918, 19/F
Lee Garden One
33 Hysan Avenue
Causeway Bay
Hong Kong
CORPORATE INFORMATION
– 130 –


--- page 142 ---
Board committees Audit committee
Mr. Chen Qifeng (ࢤ)Chairperson)
Mr. Wong Sai Hung ( ˮ˰ඪ)
Ms. Xiao Jieyu ( ӽẘѹ)
Nomination committee
Dr. Zhang Faming (׼)Chairperson)
Dr. Bi Honggang (፻)
Dr. Zhang Qiongguang ( ੵᖘΈ)
Ms. Xiao Jieyu ( ӽẘѹ)
Mr. Chen Qifeng (ࢤ)
Remuneration committee
Mr. Wong Sai Hung ( ˮ˰ඪ) (Chairperson)
Dr. Henry Qixiang Li ( ҽՉജ)
Dr. Bi Honggang (፻)
Compliance advisor Red Sun Capital Limited
Room 2703, 27/F
China Insurance Group Building
141 Des V oeux Road Central
Hong Kong
Receiving bank Industrial and Commercial Bank of China
(Asia) Limited
33/F., ICBC Tower
3 Garden Road
Central
Hong Kong
H Share Registrar Tricor Investor Services Limited
17/F, Far East Finance Centre
16 Harcourt Road
Hong Kong
Principal bank China Merchants Bank (Wuhan Optics
Valley Technology Branch)
No. 1, No. 475 Guanshan Avenue
East Lake New Technology
Development District
Wuhan, Hubei
PRC
CORPORATE INFORMATION
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--- page 143 ---
The information and statistics set out in this section and other sections of this
prospectus were extracted from the report prepared by an independent third party source,
F&S, which was commissioned by us, and from various official government publications
and other publicly available publications. We engaged F&S to prepare the F&S Report,
an independent industry report, in connection with the Global Offering. The information
from official government sources has not been independently verified by us, the Sole
Sponsor , the Sponsor-Overall Coordinator , the Overall Coordinators, the Joint Global
Coordinators, the Joint Bookrunners, the Joint Lead Managers, 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, fairness and
completeness.
SOURCE OF INFORMATION
We engaged F&S, a market research consultant, to prepare the F&S Report for use in this
prospectus. The information from F&S disclosed in this prospectus is extracted from the F&S
Report and is disclosed with the consent of F&S. In preparing the F&S Report, F&S collected
and reviewed publicly available data such as government-derived information, annual reports,
trade and medical journals, industry reports and other available information gathered by
not-for-profit organizations as well as market data collected by conducting interviews with
industry key opinion leaders.
F&S has exercised due care in collecting and reviewing the information so collected and
independently analyzed the information, but the accuracy of the conclusions of its review
largely relies on the accuracy of the information collected. We agreed to pay F&S a fee of
RMB630,000 for the preparation and update of the F&S Report, which is not contingent on the
Global Offering proceeding.
OVERVIEW OF ONCOLOGY DRUG MARKET
Accompanying with the growth of economy and healthcare demand, the global and China
pharmaceutical market kept increasing in recent years, among which, the therapeutic area of
oncology takes the largest and the second-largest segment in the global and China
pharmaceutical market, respectively. According to the F&S Report, the global incidence of
cancer increased from 18.5 million in 2019 to 21.3 million in 2024 at a CAGR of 2.9%, and
is expected to further increase to 24.5 million and 27.1 million in 2030 and 2035, respectively,
representing a CAGR of 2.3% from 2024 to 2030 and 2.1% from 2030 to 2035. The global
oncology drug market reached US$253.3 billion in 2024, and it is expected to increase to
US$452.5 billion and US$702.7 billion in 2030 and 2035, respectively, representing a CAGR
of 10.2% from 2024 to 2030 and 9.2% from 2030 to 2035. The China oncology drug market
reached US$35.9 billion in 2024, and it is expected to increase to US$73.4 billion and
US$145.0 billion in 2030 and 2035, respectively, representing a CAGR of 12.6% from 2024 to
2030 and 14.6% from 2030 to 2035.
INDUSTRY OVERVIEW
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--- page 144 ---
Global and China Oncology Drug Market, 2019-2035E
China RoW
Period CAGR
China RoW Global
2019-2024
2024-2030E
2030E-2035E
Billion USD
2019 2020 2021 2022 2023 2024 2025E 2026E 2027E 2028E 2029E 2030E 2031E 2032E 2033E 2034E 2035E
6.3% 13.2% 12.0%
12.6% 9.7% 10.2%
14.6% 8.0% 9.2%
26.4 28.6 35.8 34.7 34.1 35.9 39.0 42.7 47.8 54.3 62.9 73.4 85.8 99.2 114.1 129.3 145.0 117.0 121.6 145.9 170.4 194.7 217.4 240.5 267.6 295.7 321.7 348.0 379.2 413.0 449.0 482.6 520.4 557.7
143.5 150.3 181.7 205.1 228.9 253.3 279.5 310.3 343.5 375.9 410.8
452.5
498.8
548.2
596.7
649.7
702.7
Source: Annual report, Expert interview, Literature Review, Frost & Sullivan Analysis
Developments of Oncology Therapies
With changes of lifestyle, increased life expectancy, and effective control of other
diseases, cancer has become one of the leading threats to human health. Tumors begin with the
breakdown of orderly processes in the body, leading to abnormal differentiation of local cells,
uncontrolled proliferation, and evasion of surveillance and pursuit by the body’s immune
system. The primary challenge in treating cancer is targeting cancerous cells. Cancer cells are
mutations of a patient’s normal cells and therefore closely resemble a patient’s own cells.
Cancer cells have the ability to both invade nearby tissues and spread to distant regions of the
body. To treat cancer, the therapy must be able to distinguish between cancerous cells and
healthy cells. Traditional cancer treatments are very much limited by this targeting problem.
Conventional treatment methods such as surgery, radiotherapy and chemotherapy have
been widely utilized to treat cancer. Surgery can remove the tumor and nearby tissue during an
operation. It is best for early stage tumors that are constrained in one area but is limited for
cancers that have metastasized. Radiotherapy uses high doses of radiation to kill cancer cells
and shrink tumors including solid tumors and leukemia. However, it affects nearby healthy
cells, causing side effects such as fatigue, hair loss and skin changes. Chemotherapy uses one
or more anti-cancer drugs to stop or slow the growth of cancer cells. However, it targets all fast
growing cells, causing side effects such as fatigue, hair loss, easy bruising and bleeding, and
infection.
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More recent advances in genetics and cell biology have paved the way for a number of
potential new therapies that can target cancerous cells more precisely while being less
harmful to healthy cells. These alternative new therapies such as precision oncology and
immuno-oncology are generally used when the traditional therapies are not suitable or
effective. Below sets forth the mechanisms of action of three of the major oncology therapies:
 Targeted Therapy inhibits the growth of cancer cells by acting on specific targets that are
mutated and expressed in associating with tumor cell proliferation and survival. It is less
harmful to normal cells than traditional therapies.
 Immuno-oncology Therapy acts on immune systems including immune checkpoints that
regulate the innate immune response to clear tumor cells. With the immune system fully
activated, immune-oncology therapies could potentially lead to more durable anti-tumor
activities.
 Combination Therapy uses multiple therapies as a combination. The combination of
immune-oncology with chemotherapy, targeted drugs and other immune-oncology
therapies are all potential therapeutic strategies with synergistic effect due to their
synergistic MoAs and different toxicology profile.
According to the F&S Report, immuno-oncology therapy, particularly immune
checkpoint inhibitors, has gained significant advances in recent years and benefited cancer
patients with superior clinical benefits. Furthermore, it has the tendency to shift toward
first-line treatment.
OVERVIEW OF IMMUNO-ONCOLOGY THERAPY
Over the last decade, immuno-oncology therapy has revolutionized cancer treatment.
Immuno-oncology therapy is designed to stimulate the patient’s own immune system to
generate or augment an antitumor immune response in order to control or eradicate cancer
cells. The immuno-oncology therapies comprise those activating innate immunity and those
activating adaptive immunity. Due to its ability to provide durable remissions while being
generally well-tolerated in patients of advanced cancers, the discovery and development of
immuno-oncology therapies in recent years mark a milestone in cancer treatment. Below sets
forth the major mechanisms of immuno-oncology therapy:
 Immune Therapy Targeting Innate Immunity
Innate immune effectors include natural killer cells, polymorphonuclear, macrophages,
and monocytes, which can engage in direct tumoricidal activity or exert Fc-mediated
effector functions against antibody-opsonized tumor cells utilizing multiple mechanisms.
The related signaling pathways include CD47/SIRP /H9251, KIR-HLA, CD94-NKG2A, CD24,
etc..
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 Immune Therapy Targeting Adaptive Immunity
By initiating and promoting the adaptive immunity or inhibiting the adaptive immune
resistance, tumor growth can be effectively inhibited or controlled. The adaptive immune
resistance is a process in which immune system try to attack the cancer, but cancer
changes in a reactive fashion to protect itself from the attack. Inhibiting adaptive immune
resistance is the mechanistic basis of responses to PD-1 or PD-L1 blocking antibodies,
and may be of relevance for the development of other cancer immunotherapy strategies.
The related signaling pathways include CD28-CD80/CD86, CTLA-4-CD80/CD86.
Nowadays, anti-tumor immunotherapy is playing an increasingly important role in the
field of cancer therapy. Encouraging data have been seen in trials of various malignant tumors,
with improved efficacy and reduced adverse effects through exploration of new immuno-
oncology targets and new modalities such as bispecific antibody and combination therapy.
Exploration and Developments of Immuno-oncology Therapies
Immuno-oncology therapies are emerging cancer therapies in global market, including the
therapies of cytokines, therapeutic cancer vaccine, immune checkpoint inhibitors and adoptive
cell transfer therapies. Immuno-oncology therapies are expected to bring increasing clinical
benefits to patients across almost all major cancer types around the world.
Considering their structure and mechanism of action, antibody like-drugs (generalized as
the term antibody) including monoclonal antibody, bispecific antibody, antibody drug
conjugate (ADC) and fusion protein is an emerging pillar of cancer immune checkpoint
therapies. Currently, the majority of the immuno-oncology therapies on the market revolve
around T cells, such as PD-1, PD-L1 and CTLA-4 inhibitors, and CAR-T cell therapies, while
other immune cell types that can be mobilized, including macrophage and NK cells, are still
at development stage.
The most widely prescribed and efficacious single agent immune checkpoint antibody
therapies that have been discovered and successfully developed to date are PD-1/PD-L1 and
CTLA-4 monoclonal antibodies. In addition to PD-1/PD-L1 and CTLA-4, there are also a
number of other immune checkpoints that are being explored in clinical trials, which also
exhibit unique functions in regulating distinct aspects of immunity.
Global and China Immuno-oncology Therapy Market
According to the F&S Report, in 2024, China immuno-oncology therapies market has
reached US$4.1 billion, growing from US$1.1 billion in 2019. It is expected to increase to
US$22.0 billion and US$68.9 billion in 2030 and 2035 respectively, with the CAGR of 32.4%
from 2024 to 2030 and 25.7% from 2030 to 2035. In addition, the percentage of global
immuno-oncology therapy market to global oncology drug market increased significantly from
20.2% in 2019 to 27.5% in 2024. The global immuno-oncology therapy market is projected to
represent 49.6% of the market share of global oncology drug market in 2035.
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Currently, approximately 90% of the approved immune-oncology therapies are
monoclonal antibodies, and majority of other types (e.g., bispecific antibody, ADC, fusion
protein) of therapies are under the development. As of the Latest Practicable Date, checkpoint
antibodies market are mainly composed of checkpoints PD-1/PD-L1 and CTLA-4. The
following chart sets forth the historical and projected immuno-oncology therapy market size in
the global market and China, and the global market share of immuno-oncology therapy as a
percentage of the global oncology market for the periods indicated:
Global Immuno-Oncology Therapy Market by Region, 2019-2035E
2019 2020 2021 2022 2023 2024 2025E 2026E 2027E 2028E 2029E 2030E 2031E 2032E 2033E 2034E 2035E
Period CAGR
China RoW Global
2019-2024
2024-2030E
2030E-2035E
Billion USD
China RoW % of global oncology drug market
30.8% 18.6% 19.1%
32.4% 14.3% 15.8%
25.7% 13.9% 15.7%
20.2%
23.4% 23.4% 24.5% 26.5% 27.5% 28.6% 30.0% 31.7% 32.9% 34.7%
37.1%
39.5%
42.2%
44.8%
47.4%
49.6%
1.11.1 2.22.2 2.52.5 3.03.0 3.53.5 4.14.1 5.15.1 6.66.6 8.6 11.6 16.1 22.0 29.5 38.3 48.2 58.4 68.9
27.9 32.9 40.0 47.2 57.1 65.5 74.9 86.4 100.4 111.9 126.5
145.7
167.5
193.3
219.2
249.6
279.3
29.0 35.1 42.6 50.2 60.6 69.6 80.1 93.0
109.0
123.6
142.6
167.7
197.0
231.5
267.4
308.0
348.2
Source: Annual report, Expert interview, Literature Review, Frost & Sullivan Analysis
Growth Drivers of Global and China’s Immuno-oncology Therapy Market
Increasing Addressable Patient Population
The incidence of cancer has increased both in global market and China, and is expected
to continuously grow due to increasing lifespan, aging of population, modern sedentary
lifestyle, and obesity. For instance, increasing lifespans and population aging play a
fundamental role, as cancer risk rises with age due to accumulated genetic damage and
declining cellular repair mechanisms. Additionally, based on large cohort studies reviewed, the
International Agency for Research on Cancer concluded there is consistent evidence that higher
amounts of body fat are associated with an increased risk of several cancers. The increasing
incidence rate combined with improving healthcare access and affordability, and the growing
demand for effective cancer treatments will fundamentally drive the continuous growth of
immune-oncology therapy market.
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Furthermore, currently approved immune-oncology therapies generally encounter low
response rates, high recurrence rates and other limitations, presenting attractive market
opportunities for immunotherapies to further improve treatment outcomes. For example, BTC
is one of the targeted indication of our Core Product. According to the F&S Report, the
incidence of BTC in China reached 139,800 in 2024, which is expected to increase to 161,100
in 2030 and 179,100 in 2035, representing a CAGR of 2.4% between 2024 and 2030 and 2.1%
between 2030 and 2035, respectively. Meanwhile, global incidence of BTC in 2024 reached
419,100, which is estimated to rise to 505,000 in 2030 and 582,900 in 2035, representing a
CAGR of 3.2% and 2.9%, respectively. Another growth driver of our products can be remarked
by the capability of our Key Product HX301 in respect of blood-brain barrier penetration.
HX301 has demonstrated a brain: plasma exposure ratio of about 70%, suggesting it could be
developed as a promising treatment of glioblastoma, an aggressive malignancy with huge
unmet medical need.
Indication Expansion and Advancement of Treatment Line of Immuno-oncology Therapies
The development of immunotherapies in previously untapped indications benefits a
growing patient population. PD-1/PD-L1 inhibitors, for instance, were initially approved for
the treatment of melanoma in 2014 and have now been approved for clinical treatment in a
wide range of cancers, such as Hodgkin lymphoma, NSCLC, HNSCC, HCC, RCC and UC. In
addition, immune-oncology therapies that initially approved for second or later line treatments
have been gradually advanced towards first-line treatment. For example, pembrolizumab was
approved in 2015 for the treatment of metastatic NSCLC patients with /H113501% tumor cells
expressing PD-L1 who relapsed or progressed after chemotherapy, and its combination with
chemotherapy was later approved in 2018 for the first-line treatment of metastatic NSCLC
regardless of PD-L1 expression levels. Our Key Product HX009 also remarks such trend of
addressing unmet clinical needs and advancing treatment line. For example, HX009 is a
1L/2L+ treatment for melanoma patients, and it is the only PD-1/CD47 bispecific antibody
fusion protein targeting melanoma globally. Also, for treatment of biliary tract cancer,
preferred first-line therapies in China for BTC are combined therapies comprising
chemotherapy and targeted monoclonal antibodies, which calls for novel treatment with
combination therapies. Clinical use of immunotherapy in the frontline treatment can
significantly increase its addressable patient population and treatment duration, thus further
drive the immunotherapy market size.
Emerging Immune Targets
Since the approval of CTLA-4 inhibitor in 2011 and especially the approval of over ten
PD-1/PD-L1 inhibitors worldwide, the immune-oncology therapy market has maintained a high
rate of booming growth, with a CAGR of 19.1% and 30.8% globally and in China, respectively,
from 2019 to 2024. The emergence of immuno-oncology targets, including CD47, OX40,
TIGIT and others, is continuously enriching the pool of potential drug candidates. HX009 of
our Company, as an example, is the only PD-1/CD47 bispecific antibody fusion protein
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targeting melanoma and biliary tract cancer globally. This development suggests that the
pipeline for promising targeted therapies may grow. As a result, the market for immuno-
oncology treatments is anticipated to experience further growth.
Limitations of Current Immune Checkpoint Inhibitors
The rapid development of immune checkpoint inhibitors has revealed some safety
concerns that potentially cause harm to the body of the patients. For example, red blood cell
related toxicity constitutes the major concern in CD47-targeted drugs. Meanwhile, the safety
concerns also impede the broader application of CTLA-4 blockers. According to the F&S
Report, based on the safety results of approved CTLA-4 monoclonal antibody, the rate of
serious adverse reactions generally amounts to over 50%.
In addition, although T cell immune checkpoint inhibitors, such as PD-1/PD-L1
antibodies, are widely used in the clinic (including in the frontline treatment), according to the
responsive rate of major indications to PD-1/PD-L1 inhibitors listed below, there are only
about approximately 10% to 29% of patients across almost all major cancer types that can
benefit from PD-1/PD-L1 monotherapy treatment.
Responsive Rate of Major Indication to PD-1/PD-L1 Inhibitors
PD-1
PD-L1
19-20%
14% 2-10%
12-19% <10%
NSCLC SCLC CRC GC HNSCC HCC ESCC BTC RCC OC CC UC STS
5-18%
13-24%10%5%
20-29%14%8-15%22%3-22%19-20%16-17%13-16%13-14%
Notes:
(1) The response rates are based on the latest label from FDA and NMPA except for CRC, GC, SCLC, OC, BTC
and STS, which are based on the published clinical results.
(2) Only monotherapy clinical results are listed.
(3) Results of adjuvant therapy are excluded. Results may vary from different cancer sub-types or clinical trials.
(4) The clinical results listed are from general cancer population regardless of PD-1/PD-L1 expression, except for
the response rate of CC, which is restricted in PD-L1 positive population (combined positive score /H113501).
(5) NSCLC refers to non-small cell lung cancer; SCLC refers to small cell lung cancer; RCC refers to renal cell
carcinoma; HNSCC refers to squamous carcinoma of head and neck; UC refers to urothelial carcinoma; HCC
refers to hepatocellular carcinoma; CC refers to cervical cancer; GC refers to gastric cancer; ESCC refers to
esophageal squamous cell; CRC refers to colorectal cancer; OC refers to ovarian cancer; BTC refers to biliary
tract cancers; and STS refers to soft-tissue sarcomas.
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Despite the therapeutic benefits, it has risen an urgent need to overcome such limitations
of immune-oncology treated patients, which requires robust scientific understanding and good
development strategies so that the adverse event can be kept manageable and minimal, and the
overall response rate can be improved significantly.
Recent Developments of Immune Checkpoint Inhibitors
Currently, the majority of immune checkpoint inhibitors are single targeting, which bear
limitations as discussed above hence arose the need for new treatment strategies, especially the
ones that can effectively leverage previously well-studied targets and create synergic effect
based upon them. In particular, both combination therapy and bispecific antibodies are synergic
strategies of these types, with clinical evidence showing that synergistic combination and
bispecific strategies enabling the dual activation of innate and adaptive immune systems, as
well as combination of immunotherapies with other treatments, can induce enhanced
tumor-killing effects and improve clinical outcomes.
The significance of combined immunotherapy is to improve the therapeutic effect, reduce
drug resistance, prolong survival, and improve the quality of life through the synergistic effect
of multiple mechanisms. It has revealed by ongoing trials that PD-1/PD-L1 in combination
with targeted therapies such as VEGF inhibitor may lead to enhanced T cell infiltration due to
the tumor micro-environment modulation. With the investigation on more potent combination
such as PD-1/PD-L1 inhibitor with CD47-targeted drugs, the varieties of treatment
combinations will be enriched and a tremendous market potential is thus presented. It is
expected that these synergic treatment strategies will be more diverse in the future, leading to
an enhanced efficacy.
Bispecific antibodies as a new approach to cancer immunotherapy have garnered
widespread attention and research. These antibodies can block multiple signaling pathways
involved in tumor progression, enhance the tumor-killing ability of immune cells, and reduce
the toxicity of immunotherapy. In 2022, cadonilimab, as the world’s first PD-1/PD-L1 targeted
bispecific antibody drug, was approved for marketing, marking a new chapter in the treatment
of tumors with bispecific antibodies. With continuous technological advancements and
increasing market demand, it is expected that the supply of bispecific antibody market will
continue to increase in the coming years, providing more innovative and effective options for
cancer treatment.
Generally, bispecific antibody refers to an engineered antibody containing two antigen-
binding sites for different epitopes. The structure of bispecific antibodies may or may not
resemble conventional monoclonal antibodies, comprising two heavy peptide chains and two
light peptide chains. They may developed into therapeutics, such as those for treating cancer
and inflammatory and autoimmune diseases. Meanwhile, bifunctional fusion protein refers to
the fusion of two protein domains from different gene sources (e.g. nature proteins) by a linker
peptide. The fusion protein acquires distinct functions derived from each component domain.
Many protein drugs are fused to part of an antibody to achieve optimized therapeutic effects,
such as treating cancer and autoimmune diseases.
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In respect of the Company’s pipeline products, in particular HX009 and HX044, they have
the characteristics of a hybrid of both bispecific antibody and bifunctional fusion protein,
comprised of antibody and a fused protein. HX009 developed by our Group, constructed by
grafting the extracellular CD47-binding domain of human SIRP /H9251protein at the C-terminus of
the heavy chain of PD-1, can have elevated avidity (i.e., apparent affinity) to bind to CD47 on
Teff because of cis-binding, where effective PD-1 binding will be the driver binder of the
BsAb. Meanwhile, the SIRP /H9251domain has substantially reduced CD47 binding affinity, aiming
at reducing binding to CD47
+ red blood cells and megakaryocytes to reduce hemotoxicity, and
also to reduce the anti-CD47 antigen sink effect due to the broad expression of CD47 among
normal tissues. PD-1 has little systemic expression, but is over expressed in tumor
micro-environment, so HX009 can target on tumor while weaken the binding to CD47
+ red
blood cells in the system, and it has also demonstrated safety and efficacy in its preclinical and
clinical studies.
OVERVIEW OF PD-1/PD-L1 ANTIBODY INHIBITORS MARKET
Mechanism of PD-1/PD-L1 Antibody Inhibitors Therapy
PD-1 and its ligand PD-L1 perform an important role in tumor progression and tumor’s
survival by escaping tumor immune surveillance in TME. PD-1 is a common
immunosuppressive member on the surface of T cells and plays an imperative part in
down-regulating the immune system and advancing self-tolerance. PD-L1 is overexpressed on
the surface of malignant tumor cells, as well as other immune cells, where it binds to PD-1,
inhibits the proliferation of PD-1-positive T cells, and participates in the immune evasion of
tumors leading to rapid tumor growth. The PD-1/PD-L1-based pathway is of great value in
immunotherapy of cancer. The diagram below illustrates the mechanism of PD-1/PD-L1
antibody inhibitors therapy:
Cancer
T cell
APC
Treg
PD-1
PD-L1 antibody inhibitors
PD-1 antibody inhibitors
PD-L1
PD-L2
PD-L1
PD-L2
PD-L1
PD-L2
MHC-
Ag
Ag
TCR PD-1
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Source: Frost & Sullivan Analysis
Notes:
(1) When PD-1 binds PD-L1/PD-L2, the T cell receives an inhibitory signal. The inhibition via PD-1 and its
ligands lead to T-cell anergy and blockade of a productive antitumor immune response.
(2) PD-1 and PD-L1 antibody inhibitors can block the binding of PD-1 and PD-L1, block the negative regulatory
mechanism, and reactivate the immune response of T cells to tumors, thereby achieving an anti-tumor effect.
Global and China PD-1/PD-L1 Antibody Drug Market Size
According to the F&S Report, the global PD-1/PD-L1 antibody drug market has grown
rapidly in the past five years, from US$23.2 billion in 2019 to US$53.7 billion in 2024, with
a CAGR of 18.3%. With more and more monoclonal and bispecific antibody launched, it is
expected to reach US$72.5 billion in 2030 and US$98.0 billion in 2035, with a CAGR of 5.1%
from 2024 to 2030 and 6.2% from 2030 to 2035. The chart below illustrates the global and
China PD-1/PD-L1 antibody drug market size for the periods indicated:
Global PD-1/PD-L1 Antibody Drug Market, 2019-2035E
China RoW
Billion USD
2030E-2035E
2024-2030E
2019-2024
Period CAGR
China RoW Global
32.7% 17.5% 18.3%
21.5% 3.3% 5.1%
14.1% 4.3% 6.2%
16.3
23.2
28.6
34.4
40.3
47.6
53.7
60.2
67.2
74.1 74.4 73.1 72.5 72.8
76.7
82.1
89.0
98.0
2018 2019 2020 2021 2022 2023 2024 2025E 2026E 2027E 2028E 2029E 2030E 2031E 2032E 2033E 2034E 2035E
0.10.1 0.90.9 2.02.0 2.3 2.8 3.3 3.7 4.5 5.4 6.5 8.0 9.8 11.9 14.2 16.4 18.5 20.7 23.016.2 22.3 26.6 32.1 37.5
44.3 50.0
55.7
61.8
67.6 66.4 63.2 60.6 58.6 60.4
63.6
68.3
74.9
Source: Annual report, Expert interview, Literature Review, Frost & Sullivan Analysis
Note:
(1) As the core patents of Keytruda and Opdivo will expire in 2028, numerous generic drugs will be launched,
which is expected to lead to a slight decline in the global antibody drug market then. According to the F&S
Report, as the patent for the original PD-1/PD-L1 expires, the number of generic drugs will surge, revenue will
fall due to competition, and the market size of such drugs that are experiencing patent cliff (all of them are
mAb) will drop in the short run. However, the market will increase in the long run with the increasing number
of innovative drugs approved. According to the Industry Consultant, innovative drugs with novel targets or
BsAb drugs (such as the pipeline products developed by our Company) are less likely to experience such
market drop resulted from the patent cliff of the abovementioned mAb drugs. Therefore, we do not expect such
patent cliff will have material adverse impact on the course of development and commercial prospects of the
Company’s Core Product and product candidates.
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As of the Latest Practicable Date, global and China PD-1/PD-L1 antibody drugs have
been marketed for indications including melanoma, non-small cell lung cancer, small cell lung
cancer, head and neck squamous cell carcinoma, lymphoma, urothelial carcinoma, colorectal
cancer, hepatocellular carcinoma, Merkel cell carcinoma, renal cell carcinoma, esophageal
cancer, adenocarcinoma of esophagogastric junction, endometrial carcinoma, cutaneous
squamous cell cancer, triple-negative breast cancer, gastric cancer, gastroesophageal junction
cancer, basal cell carcinoma, nasopharyngeal carcinoma, malignant pleural mesothelioma,
biliary tract cancer, alveolar soft part sarcoma, endometrial cancer, medullary thyroid cancer,
squamous carcinoma of the anal canal and cervical cancer.
Entry Barriers of PD-1/PD-L1 Antibody Drug Market
 Intensified Market Competition: The market is increasingly crowded with multiple
PD-1/PD-L1 inhibitors, making it difficult for new entrants to compete. This is
exacerbated by the fact that the market competition is intensified, with several agents
approved across various cancer indications, leading to a complex landscape that is
challenging to navigate. PD-1/PD-L1 bispecific antibodies, with their potential for high
efficacy and low toxicity, hold broad market prospects in a competitive landscape and
provide new therapeutic options for cancer immunotherapy. With the advancement of
clinical research and the development of new strategies, it is anticipated that this field
will witness more breakthroughs and commercial opportunities.
 Regulatory Scrutiny: There is growing regulatory pressure, with demands for local data
and head-to-head comparisons against the latest standard of care. This raises the evidence
bar for new entrants and increases development risk. The FDA ’s comments on current
PD-1/PD-L1 development trends and its position in recent reviews indicate that relevant
regulatory reviews will become increasingly stringent. The FDA ’s requirements for local
data and direct comparison with the latest treatment standards have raised the threshold
for evidence, increasing both innovation costs and development risks. Meanwhile, the
NMPA has also strengthened its supervision of innovative drug approvals, with more
strict approval requirements and more cautious approval of homogeneous studies and
pseudo-innovative drugs.
 Complicated and Costly Clinical Trials: Facing the complex landscape of the PD-
1/PD-L1 market, regulatory authorities are increasingly challenged by market to assess
the incremental benefits of new PD-1/PD-L1 therapies, especially combination therapies.
Consequently, regulatory authorities will push for head-to-head trials related to
therapeutic standards and may even compare them with competitive new PD-1/PD-L1
therapies. Therefore, newly developed PD-1/PD-L1 antibodies need to undergo more
extensive clinical trials to prove their safety and efficacy. These trials are usually costly
and time-consuming, and are more challenging for new entrants.
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Growth Drivers of PD-1/PD-L1 Antibody Market
 Continuous Research and Advancement: The PD-1/PD-L1 inhibitor landscape has
grown to cover a wide range of cancers, catering to diverse patient needs. Ongoing
clinical trials aim to expand treatment indications and address unmet clinical needs.
Combination therapies with PD-1/PD-L1 inhibitors and PD-1/PD-L1 bispecific
antibodies have shown significant benefits in progression-free and overall survival,
addressing resistance and toxicity issues. Future research is expected to further broaden
the market for these inhibitors.
 Advancement to First-Line Treatment: At present, multiple clinical trials of PD-1/PD-L1
mAbs are conducted for the first-line treatment of cancer. Companies are making efforts
to advance from third-line or second-line to first-line therapy and continue to expand to
consolidation therapy for locally advanced cancer and neo-adjuvant therapy for early or
mid-stage cancer. Hence, more PD-1/PD-L1 mAbs are expected to be approved for
first-line treatment of cancer in the near future. The advancement of PD-1/PD-L1 mAbs
as first-line treatments has significantly expanded the immuno-oncology market but also
led to increased drug resistance. This resistance, often caused by alternative immune
checkpoint activations, creates a growing demand for second-line therapies. HX009, as a
bifunctional anti-PD-1 antibody-SIRP /H9251fusion protein, addresses this need by co-
targeting CD8+ T effector cells and engaging CD47 within the tumor microenvironment,
enhancing immune response and overcoming resistance. Given the trend towards
combination therapies to circumvent resistance, HX009’s dual-targeting mechanism
aligns well with this approach, positioning it as a promising second-line treatment. Thus,
the increased resistance to first-line PD-1/PD-L1 treatments actually increases the market
potential for HX009, benefiting both the market and the company’s development and
future commercialization efforts.
 Favorable Policy: Since 2016, the National Health Commission, the National
Development and Reform Commission and other departments of China have successively
issued policies to support and standardize the development of the anti-tumor drug
industry, including accelerating approval of new drugs, prioritizing review and approval,
and strengthening the clinical application management of anti-tumor drugs. For example,
the China National Medical Products Administration issued the “ Technical Guidelines for
Clinical Development of Bispecific Antibody Anti-Tumor Drugs ”, which provide detailed
guidance on developing bispecific antibody drugs and conducting clinical trials. This
helps company to accelerate the product development. Meanwhile, diverse policies such
as National Reimbursement Drug List negotiations, inclusion in medical insurance, and
tax concessions for imported anti-cancer drugs have continuously improved the
accessibility of anti-cancer drugs and reduced the drug burden of cancer patients. As of
the Latest Practicable Date, there were 16 PD-1 and 10 PD-L1 mAbs have been approved,
and two new PD-1 bispecific antibody drugs has been launched for cancer treatment. The
favorable drug approval policy and medical insurance policy are expected to continue to
expand the capacity of China’s PD-1/PD-L1 antibody market.
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Global (including China) Approved PD-1/PD-L1 Bispecific Antibody Drugs
Currently, there are two approved PD-1 bispecific antibody drug, which are cadonilimab
and ivonescimab.
Cadonilimab
Kaitanni® Akeso
Cervical Cancer 2L Monotherapy 2022/06/28
China B
approximately
RMB7,500
GC/GEJC 1L
Combination with
fluoropyrimidine and
platinum-based
chemotherapy agents
This product is administered
via intravenous infusion. The
recommended dose is 6
mg/kg, given every 2 weeks
until disease progression or
intolerable toxicity occurs.
This product is administered
by intravenous infusion. The
recommended dose is 10
mg/kg, given every 3 weeks
until disease progression or
intolerable toxicity occurs.
This product is administered
via intravenous infusion. The
recommended dose is 20
mg/kg, given every 3 weeks
until disease progression or
intolerable toxicity occurs.
EGFR-mutated locally
advanced or metastatic
NSCLC patient who
have progressed after
EGFR-TKI treatment
locally advanced or
metastatic NSCLC
with PD-L1 TPS≥1%,
EGFR mutation-
negative, and
ALK-negative
Combination with
Pemetrexed and
carboplatin
Ivonescimab
Yidafang®
2024/09/26 approximately
RMB11,000
PD-1,
VEGF Akeso
2L 2024/05/21
China
B approximately
RMB10,000
1L Monotherapy 2025/04/22 / approximately
RMB32,000
Target Company Indications Dosage Country Line of
Treatment
Combination
Therapy
Approval
Date
Price per
Treatment
Cycle
Medical
Insurance
Drug
Name
PD-1,
CTLA-4
Source: NMP A, FDA, Company Website, Literature Review, Frost & Sullivan Analysis
Notes:
(1) Industry information is as of December 8, 2025.
(2) GC refers to Gastric Cancer; GEJC refers to Gastroesophageal Junction Cancer.
(3) In 2023, the annual sales of Kaitanni were RMB1,357.8 million. However, in 2024, Akeso did not disclose the
annual sales of Kaitanni and Yidafang.
Competitive Landscape of PD-1 Targeted Bispecific Antibody/Bifunctional Fusion Protein
As of the Latest Practicable Date, more than 40 PD-1 targeted bispecific antibody drugs
with more than 15 targets are under the development, including CD47, CTLA-4, LAG3, etc.,
and most of them are still in Phase I and Phase II. As of the Latest Practicable Date, there was
no approved CD47/PD-1 bispecific antibody/bifunctional fusion protein products globally, and
HX009 developed by the Company is the only bispecific antibody fusion protein targeting both
PD-1 and CD47 concurrently in both global and China market.
INDUSTRY OVERVIEW
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Global (excluding China) Competitive Landscape of PD-1 Targeted Bispecific
Antibody/Bifunctional Fusion Protein Pipeline
First Posted
Date Clinical StageIndicationsCompanyDrug Name
/CodeTarget
2019/09/20Phase I*Advanced Solid TumorHanx BioHX009PD-1, CD47
2023/11/29Phase INSCLC, TNBC, HNSCC, Malignant MelanomaCompass TherapeuticsCTX-8371PD-1, PD-L1
2020/04/27Phase IAdvanced Solid TumorsAmgen+InnoventAMG256PD-1, IL21
2021/12/06Phase IAdvanced or Metastatic HER2-expressing Solid Tumors3SBio+3s guojianSSGJ705PD-1, HER2
2023/03/29Phase ISolid TumorCelldex TherapeuticsBSI-585PD-1, LILRB2
2023/12/08Phase IAdvanced/Metastatic Solid TumorSotio BiotechSOT201PD-1, IL15 2023/05/22Phase IAdvanced Solid TumorsAosaikang+AskGeneASKG915
2023/05/01Phase ISolid TumorsMerus+IncyteINCA33890PD-1,TGFβR2
2021/10/15Phase IRelapsed or Refractory T Cell LymphomaMerus+Ono
PharmaceuticalONO-4685PD-1, CD3 2024/08/29Phase IT Cell Lymphoma and CLL/SLL
2023/12/19Phase ILocally Advanced/Metastatic Solid TumorsProviva TherapeuticsPTX-912PD-1, IL2R 2024/06/28Phase IAdvanced Solod TumorTevaTEV-56278
2024/02/25Phase IIAdvanced Solid MalignanciesInnoventIBI363
PD-1, IL2RA 2025/10/15Phase IIIAdvanced Squamous Lung CancerInnovent+Fortvita
2024/05/14Phase I/IIAdvanced Solid Organ MalignanciesRegeneronREGN10597
2024/08/30Phase INSCLC, UC, RCC, melanoma, HNSCC, and microsatellite stable colorectal cancerPfizerPF-07921585PD-1, IL12R
2024/06/19Phase I/IIAdvanced Solid TumorAnaveonANV600
PD-1, IL2/15Rβγc
2020/03/11Phase ILocally advanced / unresectable or metastatic diseaseRocheEciskafusp alfa 2025/02/10Phase INon-muscle Invasive Bladder Cancer
2023/10/23Phase IAdvanced CancerAnwita BiosciencesAWT020
2023/12/08Phase IAdvanced/Metastatic CancerSOTIO BiotechSOT201
2019/09/09Phase II/IIIGC, Gastroesophageal Junction CancerMacroGenics+Zai LabTebotelimab
PD-1, LAG3 2017/07/17Phase IAdvanced Solid Tumors
2022/10/13Phase IAdvanced MalignanciesMerus+Incyte CorporationINCA32459
2025/06/11Phase IAdvanced Malignant Tumors3SbioSSGJ-709
2022/02/01Phase I/IIHLAstraZenecaAZD7789
PD-1, TIM-3 2023/01/27Phase IIMetastatic Gastric or Gastroesophageal Junction Adenocarcinoma
2018/10/17Phase ISolid TumorsRocheLomvastomig 2021/03/08Phase IIAdvanced or Metastatic Esophageal Squamous Cell Carcinoma
2024/10/08Phase I/IIAdvanced Solid TumorOncoC4AI-081
PD-1ͫVEGF
2025/11/14Phase IIIMetastatic Colorectal Cancer
Akeso / Summit
TherapeuticsIvonescimab
2024/07/26Phase IIBTC
2024/08/22Phase IICutaneous Squamous Cell Carcinoma
2025/01/28Phase IIAdvanced, Metastatic Salivary Gland Cancers
2025/02/18Phase IIPleural Mesothelioma
2025/02/20Phase IIAdvanced or Metastatic Gastric/Gastroesophageal Adenocarcinoma
2025/02/26Phase IIAdvanced, Metastatic Salivary Gland Cancers
2025/04/13Phase IIEndometrial and Cervical Cancers
2025/04/23Phase IIAdvanced Clear Cell Renal Cell Carcinoma
2025/05/20Phase IIThymic Cancer
2025/06/12Phase IITNBC
2025/07/17Phase IIAdvanced HER2 Negative Gastroesophageal Adenocarcinomas
2025/07/30Phase IIResectable Stage II-IV Head and Neck Cancer
2025/11/19Phase IIActive Brain Metastases From NSCLC
2024/11/04Phase I/IIGlioblastoma
2025/10/30Phase IIIColorectal Cancer
3SBioSSGJ-707
2025/10/30Phase IIINSCLC
2025/11/12Phase II/IIISCLC
2025/11/12Phase I/IIHepatocellular Carcinoma
2025/11/12Phase I/IIRenal Cell Carcinoma
2025/03/10Phase INASeismic TherapeuticS-4321PD-1, FCGR2B
2023/10/26Phase IIIBTC
AstraZenecaRilvegostomigPD-1, TIGIT
2024/10/03Phase IIINSCLC
2025/01/07Phase IIIGastric Cancer
2025/04/10Phase IIIHepatocellular Carcinoma
2025/05/25Phase IIIEndometrial Cancer
2025/08/11Phase I/IIAdvanced or Metastatic Solid Tumors
2023/08/09Phase IIINSCLC
AstraZenecaVolrustomig
/MEDI5752
PD-1, CTLA4
2023/10/12Phase IIILocally Advanced Cervical cancer
2023/10/24Phase IIIUnresectable Pleural Mesothelioma
2023/11/13Phase IIIHNSCC
2025/06/02Phase IIIAdvanced Clear Cell Renal Cell Carcinoma
2023/01/27Phase IILocally Advanced Unresectable or Metastatic Gastric or Gastroesophageal Junction
Adenocarcinoma
2023/03/20Phase IIHCC, BTC
2023/06/05Phase IIAdvanced Solid Tumor
2025/01/27Phase IIMetastatic Colorectal Cancer
2020/08/21Phase IRCC
2023/04/20Phase ISoft Tissue Sarcoma
2021/08/13Phase IImCRPC
Xencor+Icon BioVudalimab
2021/09/02Phase IIAdvanced Gynecologic and Genitourinary Malignancies
2022/03/17Phase IIBTC
2022/07/22Phase IIAdvanced Cervical Cancer
2023/12/15Phase I/IINSCLC
2022/07/26Phase IIMetastatic Cancer, Cervical Cancer
MacroGenicsLorigerlimab
/MGD019
2023/05/08Phase IIProstate Cancer
2025/07/18Phase IIColorectal Cancer With Radiographic Occult Molecular Residual Disease
2022/03/24Phase IHCC, RCC, OC, Pancreatic Ductal Carcinoma
2025/11/03Phase IIRectal CancerͫRectal Cancer Recurrent
2025/12/05Phase I/IIBreast cancer, Solid tumor, Epithelial Ovarian cancerOttimo PharmaOTP-01PD-1, VEGFR2
Source: CDE, Clinical trial, Company Website, Literature Review, Frost & Sullivan Analysis
INDUSTRY OVERVIEW
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--- page 157 ---
Notes:
(1) The clinical stage refers to the latest clinical trials as well as the first posted date.
(2) First posted date refers to the date on which the study record was first available on Chinadrugtrials.org.cn
or Clinicaltrials.gov .
(3) The Company obtained the FDA Study May Proceed approval in relation to the phase Ib/II study of HX009
in the U.S. for treatment of DLBCL in May 2023.
(4) Company information is from the Company, and industry information is as of the Latest Practicable Date.
China Competitive Landscape of PD-1 Targeted Bispecific Antibody/Bifunctional Fusion
Protein Pipeline
First Posted
Date
Clinical Stage/CDE
acceptance dateIndicationsCompanyDrug Name
/CodeTarget
2024/12/06INDTNBC
Hanx BioHX009PD-1, CD47
2024/11/14Phase IIMelanoma
BTC
2022/01/12Phase I/IIRelapsed/Refractory Lymphoma
2019/11/12Phase IAdvanced Malignant Solid Tumor
Unresectable/Metastatic Advanced Melanoma
2023/12/11Phase Ia/IbAdvanced Solid TumorAkesoAK131PD-1, CD73
2024/12/19Phase IIINSCLC
AstraZenecaRilvegostomig
/AZD2936
PD-1, TIGIT
2025/01/06Phase IIIBTC
2025/02/24Phase IIIHER2+ Gastric Cancer
2025/04/09Phase IIIHCC
2025/07/03Phase IILocally Advanced Resectable Gastroesophageal Adenocarcinoma
2024/08/28Phase IIIHCC
Zelgen+Gensun
BiopharmaZG005
2025/03/04Phase IIBTC
2025/03/26Phase IIAdvanced Solid Tumors
2023/12/28Phase I/IICervical Cancer
2024/05/28Phase I/IIAdvanced neuroendocrine carcinoma
2025/03/13Phase I/IIRefractory / Recurrent lymphoma
2025/03/25Phase I/IINSCLC
2025/07/23Phase I/IIAdvanced Cervical Cancer
2025/08/27Phase I/IIAdvanced Solid Tumors
2022/04/19Phase IbAdvanced MalignanciesEli Lilly+InnoventIBI321
2023/02/02Phase ISolid TumorsREMD
Biotherapeutics+
Buchang Biopharma
BC008-1A 2024/11/19Phase INeuroglioma
2025/01/22Phase IIMelanoma
Innovent+FortvitaIBI363
PD-1, IL2
2022/07/11Phase Ia/IbAdvanced Solid Tumor/Lymphoma
2024/05/09Phase IAdvanced Malignancies
2025/10/15Phase IIIAdvanced Squamous Lung Cancer
2022/12/8Phase IAdvanced/Metastatic Solid TumorNovatim KY-0118
2023/09/27Phase IAdvanced Solid TumorsHengrui MedicineSHR-5495
2019/11/04Phase Ia/IbHER2+ Advanced MalignanciesInnovent+HanmiIBI315PD-1, HER2 2025/06/19Phase IIAdvanced or Metastatic HER2-expressing Solid Tumors3SBioSSGJ-705
2025/09/12Phase IIAdvanced Non-Small Cell Lung Cancer
3SBioSSGJ-706PD-1, PD-L1 2025/11/18Phase IIGastrointestinal Cancers
2024/07/25Phase IAdvanced Malignancy
2025/05/16Phase IIINSCLC3Sbio+Hanbio+3s
guojianSSGJ-707
PD-1, VEGF
2024/07/01Phase IIMetastatic Colorectal Cancer
2024/08/06Phase IIAdvanced Gynecological Cancer
2023/08/10Phase ISolid TumorRemegenRC148 2025/02/19Phase INSCLC
2025/03/07Phase IINSCLC
Junshi BioJS207 2025/03/10Phase IIAdvanced Colorectal Cancer
2025/04/10Phase IIHCC
2025/06/26Phase IITNBC
2024/09/14Phase I/IIAdvanced Solid Tumor
LaNova
Pharmaceutical
Technology
LM-299
2025/08/19Phase IIAdvanced Breast Cancer or Other Advanced Malignant Solid TumorsMinghui
PharmaceuticalMHB039A 2024/03/01Phase I/IIAdvanced Solid Tumor
2025/11/17Phase I/IIAdvanced Lung Cancer
2025/11/28Phase IIINSCLCSinoCelltech Ltd.SCTB14
2024/08/25Phase IIIBTC
Akeso / Summit
TherapeuticsIvonescimab
2024/09/11Phase IIIRecurrent or Metastatic Head and Neck  Squamous Cell Carcinoma (R/M HNSCC)
2025/03/11Phase IIIMetastatic Colorectal Cancer
2025/01/08Phase IIITNBC
2025/04/24Phase IIIMetastatic Pancreatic Cancer
2025/05/21Phase IIISCLC
2021/03/04Phase IIAdvanced Gynecological Tumors
2022/06/23Phase IIHCC
2024/08/08Phase IIRecurrent Ovarian Cancer
2024/11/06Phase IIEsophageal Squamous Cell Carcinoma
2025/04/27Phase IIsoft tissue sarcoma
2025/06/24Phase IIPD-1 Resistant Recurrent or Meta static Nasopharyngeal Carcinoma
2025/09/09Phase IIpMMR/MSS Mid-low Rectal Cancer
2025/09/08Phase IINSCLC patients With Actionable Genomic Alterations (AGA) Who Have Failed to Previous TKI Treatment
2024/05/16Phase IMetastatic Mucosal Melanoma
2025/12/05Phase INSCLC
2021/09/22Phase I/IIAdvanced Solid TumorLeads BiolabsLBL-015
PD-1, TGF-β 2025/09/10Phase IIIMetastatic Pancreatic CancerChia Tai-tianqingTQB2868 2023/02/27Phase Ib/IIHCC
2021/05/21Phase IAdvanced MalignanciesJunshi BioJS201
2022/06/02Phase I/IIaAdvanced Malignancies
SUNHO BioIAP0971
PD-1, IL15
2023/12/18Phase I/IINMIBC
2024/01/18Phase Ib/IINSCLC
2023/09/15Phase IAdvanced MalignanciesAosaikang +
AskGene PharmaASKG915
2025/03/12Phase I/IISolid TumorsJinmante
BiotechnologyJMT108 2025/12/02Phase I/IIMelanoma
INDUSTRY OVERVIEW
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--- page 158 ---
2022/08/08Phase IIIHCC
AkesoCadonilimab
PD-1,CTLA4
2022/10/19Phase IIINasopharyngeal Carcinoma
2023/07/13Phase IIINSCLC
2022/01/04Phase IIAdvanced/Metastatic Renal Cell Carcinoma
2022/06/24Phase IIAdvanced Ovarian Cancer
2023/02/18Phase IImCRC
2023/03/21Phase IIPancreatic Cancer
2023/04/21Phase IIAdvanced Endometrial Cancer
2023/06/27Phase IIVulvar Cancer
2023/09/04Phase IIHNHCC
2023/12/12Phase IIHER2-expression Locally Advanced or Metastatic Urothelial Carcinoma
2024/04/16Phase IIAdvanced Soft Tissue Sarcoma
2024/04/16Phase IITNBC
2024/05/06Phase IISCLC
2024/09/30Phase IIMelanoma
2025/12/02Phase IIEsophageal squamous cell carcinoma
2025/01/24Phase IIIRecurrent or Metastatic Cervical Cancer
AstraZenecaVolrustomig
/MEDI5752
2025/01/14Phase IIIAdvanced or Metastatic HNSCC
2024/12/27Phase IIIPleural Mesothelioma
2025/01/24Phase IIINSCLC
2023/02/01Phase IIGC
2023/03/24Phase IIBTC/HCC
2025/01/27Phase IIColorectal Cancer
2023/08/23Phase IILocally Advanced or Metastatic Esophageal Cancer, Gastric Cancer,
Colorectal Cancer and Other Gastrointestinal Tumors
Biokin PharmaDanvilostomig
/SI-B003
2023/06/21Phase IISCLC
2023/07/10Phase IIAdvanced or Metastatic Non-small Cell Lung Cancer, Nasopharyngeal Carcinoma and Other Solid Tumors
2023/07/28Phase IILocally Advanced or Metastatic Urothelial Carcinoma and Other Solid Tumors
2024/11/01Phase IIRecurrent or Metastatic HNSCC
2024/07/17Phase I/IILocally advanced or metastatic HER2-negative gastric cancer or gastroesophageal junction adenocarcinoma
AkesoAK129PD-1, LAG3 2024/08/25Phase I/IIRecurrent or refractory classic Hodgkin’s lymphoma
2025/03/25Phase I/IIAdvanced Solid Tumor
2025/12/04Phase IAdvanced Solid Tumors3SBioSSGJ-709
2021/01/08Phase Ia/IbSolid Tumors or Hematological TumorsAdimab+Eli Lilly+
InnoventIBI319PD-1, 4-1BB
2025/05/15Phase I/IIAdvanced Solid TumorsBio-Thera SolutionsBAT7111
2023/09/27Phase IAdvanced Solid TumorsEucure TechnologyYH008PD-1, CD40
2024/05/20Phase IIAdvanced Solid TumorsL&L BiopharmaBIS5
PD-1, TIM-3 2023/01/28Phase I/IIaNSCLCAstraZenecaSabestomig
/AZD7789
2025/01/03Phase IAdvanced Solid TumorsCD(Suzhou)BiopharmaCD-001PD-1,IL21R
2025/02/11Phase IAdvanced Solid TumorsJunshi BiosciencesAWT020PD-1,IL2/15Rβγc
2025/05/16Phase IAdvanced Solid TumorsZhuhai Fapon
BiopharmaFP008PD-1,IL10R
First Posted
Date
Clinical Stage/CDE
acceptance dateIndicationsCompanyDrug Name
/CodeTarget
Source: CDE, Clinical trial, Company Website, Literature Review, Frost & Sullivan Analysis
Notes:
(1) The clinical stage refers to the latest clinical trials as well as the first posted date.
(2) First posted date refers to the date on which the study record was first available on Chinadrugtrials.org.cn
or Clinicaltrials.gov .
(3) ccRCC refers to Clear Cell Renal Cell Carcinoma; AML refers to Acute Myeloid Leukemia; and MDS refers
to Myelodysplastic Syndrome.
(4) Company information is from the Company, and industry information is as of the Latest Practicable Date.
Competitive Landscape of PD-L1 Targeted Bispecific Antibody/Bifunctional Fusion
Protein
Currently, more than 50 PD-L1 targeted bispecific antibody drugs with more than 15
targets are under the development, including CD47, CTLA-4, TGF /H9252, etc, and most of them are
still in Phase I and Phase II.
INDUSTRY OVERVIEW
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--- page 159 ---
Global (excluding China) Competitive Landscape of PD-L1 Targeted Bispecific
Antibody/Bifunctional Fusion Protein Pipeline
Target
PD-L1, CD27
PD-L1, CD47
PD-L1, PD-1
PD-L1, PD-L2
PD-L1, TIGIT
PD-L1, TGF-β
PD-L1, NKG2A
PD-L1, 4-1BB
PD-L1, VEGF
PD-L1,
IL2/15Rβγc
PD-L1, OX40
PD-L1, LAG-3
PD-L1, PD-L2
Company
Celldex Therapeutics
LogicBio Therapeutics
Bio-Thera
Innovent
Adimab+Eli
Lilly+Innovent
Compass Therapeutics
ImmunoGenesis
Fosun Pharma
Huahai Pharma+
Huabo Bio+Huaota Bio
Curon Bio
BJ Bio
Exelixis
BioNTech+Genmab
Pieris Pharma+Servier
AP Bio
Merus+Incyte
Iontas+invoX+F-star
I-Mab+ABL Bio+
HANDOK
Antengene Biologics
Hanmi Pharma
BioNTech+Biotheus
BioNTech
Simcere
Pharma+Xianxiang
Pharma+Simcere
Zaiming
EPIMAB Bio
ABLBio+HANDOK
ImmunoGenesis
Indications
Solid Tumors
Advanced Solid Tumor
Advanced Malignant Solid Tumors
Advanced Malignant Tumors Lymphomas
Advanced Cancer
NSCLC, HNSCC, TNBC, HL, Malignant Melanoma,
Solid Tumors
Locally Advanced or Metastatic Solid Tumors
Advanced Solid Tumor
NSCLC
Solid Tumor, Hematologic Malignancies
Advanced Solid Tumor or Lymphoma
Recurrent Advanced or Metastatic Solid Tumors
PD-L1-positive Metastatic NSCLC
Melanoma
Solid Tumor
Locally Advanced or Metastatic Solid Tumors,
NSCLC, HNSCC, ESCC
Advanced Cancer, Solid Tumor, B-cell Lymphoma
Advanced Cancer,
Metastatic Cancer
Advanced Solid Tumor
Advanced Solid Tumor
Advanced or Metastatic Solid Tumors
mTNBC
Small-cell Lung Cancer
NSCLC
SCLC
Triple Negative Breast Cancer
Untreated, Unresectable, or Metastatic Colorectal Cancer
Previously Untreated Advanced or Metastatic Gastric, Gastroesophageal Junction, or
Esophageal Adenocarcinoma
Solid Tumor
Advanced Colorectal Cancer
Advanced Solid Tumor
Locally Advanced Unresectable or Metastatic Solid Tumor
Advanced Solid Tumor
Advanced Solid Tumor
Solid Tumor
Clinical Stage
Phase I
Phase I/II
Phase Ib/II
Phase I
Phase I
Phase I
Phase I
Phase I/II
Phase I/II
Phase I/II
Phase I
Phase I
Phase III
Phase II
Phase I/II
Phase I/II
Phase I
Phase I
Phase I
Phase I
Phase I
Phase II
Phase II
Phase III
Phase III
Phase III
Phase II/III
Phase II/III
Phase II
Phase I/II
Phase I/II
Phase I
Phase I
Phase I
Phase I
First
Posted
Date
2020/06/22
2023/04/20
2024/07/22
2020/04/08
2019/05/03
2023/11/29
2023/08/28
2021/11/01
2022/06/14
2021/08/31
2021/11/10
2025/04/23
2024/10/08
2025/05/14
2021/12/16
2022/07/25
2019/04/19
2021/02/05
2021/02/21
2021/08/03
2024/01/31
2024/06/07
2024/06/07
2024/11/26
2024/12/02
2025/09/05
2025/10/27
2025/10/27
2025/04/23
2025/07/23
2025/08/29
2023/03/23
2022/03/02
2021/11/01
2023/08/28
Drug Name/
Code
CDX-527
LB101
BAT7104
IBI322
LY3434172
CTX-8371
IMGS-001
HLX301
HB0036
CN202
BJ-005
XB628
Acasunlimab/
GEN1046
PRS-344/
S095012
AP203
FS222
ABL503
Xirestomig/
YN051
BH3120
BNT327
PM8002
SIM0237
EMB-09
ABL 501
IMGS-001
MCLA-145
Source: CDE, Clinical trial, Company Website, Literature Review, Frost & Sullivan Analysis
Notes:
(1) The clinical stage refers to the latest clinical trials as well as the first posted date.
(2) First posted date refers to the date on which the study record was first available on Chinadrugtrials.org.cn
or Clinicaltrials.gov .
(3) The Company obtained the FDA Study May Proceed approval in relation to the phase Ib/II study of HX009
in the U.S. for treatment of DLBCL in May 2023.
(4) Company information is from the Company, and industry information is as of the Latest Practicable Date.
INDUSTRY OVERVIEW
– 148 –


--- page 160 ---
China Competitive Landscape of PD-L1 Targeted Bispecific Antibody/Bifunctional Fusion
Protein Pipeline
First Posted
Date Clinical StageIndicationsCompanyDrug Name
/CodeTarget
2025/01/21Phase IIAdvanced Solid tumors
Leads BiolabsLBL-024
PD-L1, 4-1BB
2025/08/08Phase IIAdvanced Solid Tumours (BTC&HCC)
2023/12/07Phase I/IIAdvanced Neuroendocrine Cancer
2025/08/01Phase I/IIAdvanced Melanoma
2021/09/30Phase I/IIAdvanced Solid TumorsBiotheusPM1003
2022/03/29Phase IAdvanced/Metastatic Solid Tumor, Mature B-cell Non-Hodgkin LymphomaAtG TherapeuticsATG-101
2023/02/06Phase IAdvanced Malignant TumorAnke Bio+HankeMabHK010
2024/01/31Phase IAdvanced or Metastatic Solid TumorsHanmi PharmaBH3120
2024/04/24Phase I/IIAdvanced Solid Tumors
Qilu PharmaQLF31907
2023/03/21Phase IIAdvanced Malignant Melanoma,
Advanced UC
2023/12/18Phase INMIBCSimcere
Pharma+Xianxiang PharmaSIM0237PD-L1, IL15
2024/04/01Phase IAdvanced Solid TumorsBio-TheraBAT7205
2021/06/01Phase IAdvanced Malignant TumorsInnoventIBI323PD-L1, LAG-3
2023/05/16Phase I/IIDigestive Tract Cancers
QureBioQ-1802PD-L1, CLDN-
18.2 2021/04/14Phase IAdvanced Solid Tumors
2021/05/20Phase IAdvanced Solid TumorsKelun Pharma+Klus
PharmaSKB337
PD-L1, CTLA-4
2020/07/27Phase IIIAdvanced Squamous NSCLC
AlphamabErfonrilimab
/ KN046
2021/12/03Phase IIIAdvanced Pancreatic Cancer
2019/04/25Phase IIAdvanced Unresectable or Metastatic ESCC
2020/08/20Phase IILocally Advanced HER2-positive Solid Tumors
2020/09/02Phase IIAdvanced HCC
2023/10/20Phase IIDigestive System Cancers
2020/11/03Phase I/IIAdvanced Gastrointestinal Tumors
2022/06/13Phase IIAdvanced Lung Cancer
Mabwell Bio6MW3211
PD-L1, CD47
2022/06/28Phase IIAdvanced ccRCC
2022/07/04Phase IIRelapsed and Refractory Lymphoma
2023/01/31Phase IIAML, MDS
2021/08/24Phase I/IIAdvanced Malignant Tumors
2021/07/08Phase I/IIAdvanced Malignant TumorsImmuneOncoIBC0966
2020/03/30Phase IAdvanced Malignant TumorsInnoventIBI322 2021/03/19Phase IHematologic Malignancy
2021/05/13Phase IAdvanced Malignant TumorsShangjian BioSG12473
2022/07/01Phase IAdvanced Malignant TumorsSanhome PharmaSH009 2025/05/16Phase INSCLC
2023/02/07Phase IAdvanced Solid TumorsImmuneOncoIMM2520
2022/02/22Phase IAdvanced CancerBio-Thera SolutionsBAT7104
2024/05/24Phase IIITNBC
BioNTech+BiotheusPM8002
PD-L1, VEGF
2024/09/27Phase IIISCLC
2023/03/13Phase II/IIINSCLC
2022/05/05Phase IIMalignant Mesothelioma
2022/06/08Phase IIHepatocellular Carcinoma
2022/11/04Phase IIKidney Cancer
2022/12/22Phase IINeuroendocrine Tumors
2023/02/02Phase IIAdvanced Endometrial Cancer
2025/05/26Phase IIMSS or MSI-L/pMMR metastatic colorectal cancer
2025/12/05Phase IIPancreatic Cancer
2025/07/23Phase I/IIAdvanced Colorectal Cancer
2025/08/29Phase I/IIAdvanced Solid Tumors
2022/11/04Phase IIKidney Cancer
Huaota+Huabo
Bio+Huahai Bio
HB0025
(Sotiburafusp alfa)
2023/02/02Phase IIAdvanced Endometrial Cancer
2025/05/21Phase IITNBC
2025/12/08Phase IIColorectal cancer
2023/07/13Phase I/IIAdvanced Solid Tumors
2021/06/15Phase IAdvanced Solid TumorsImmuneOncoIMM2510 2024/12/26Phase IINSCLC
2024/11/07Phase IISolid TumorsTasly PharmaceuticalB1962 2024/12/27Phase IIAdvanced Colorectal Cancer
2024/11/08Phase IAdvanced Solid TumorsFukang Health TechnologyCVL006
2022/11/02Phase IAdvanced Malignant Solid TumorsShangjian BioSG1408
2024/12/26Phase IINSCLC, TNBCImmuneOncoPalverafusp alfa
PD-L1, VEGF 2021/06/15Phase IAdvanced Solid Tumors
2025/12/03Phase INSCLCShanghai Henlius BiotechHLX37 2025/12/03Phase ISolid tumor
2025/06/13Phase I/IISolid TumorsFutureGenB901PD-L1, CD40
INDUSTRY OVERVIEW
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--- page 161 ---
First Posted
Date Clinical StageIndicationsCompanyDrug Name
/CodeTarget
2024/09/20NDAGastric cancer
Hengrui+Suncadia BioSHR-1701
PD-L1,TGF-β
2021/11/17Phase IIINon-squamous NSCLC
2021/11/22Phase IIICervical cancer
2020/12/08Phase IISCCHN
2021/07/22Phase IIAdvanced Malignant Solid Tumors
2022/03/28Phase IILocally Advanced Rectal Cancer
2020/11/09Phase Ib/IIPancreatic Cancer
2022/08/15Phase Ib/IIRelapsed or Advanced NSCLC
2023/01/06Phase Ib/IIHER2-Positive Advanced GC/GEJC
2020/02/20Phase INasopharyngeal Carcinoma
2022/08/09Phase I/IIAdvanced Malignant Solid TumorsHuaota Bio+Huabo BioHB0028
2022/09/01Phase I/IIAdvanced Malignant Solid TumorsMabwell Bio6MW3511
2023/03/23Phase I/IIAdvanced Solid TumorsBetta PharmaBPB-101
2020/06/24Phase I/IIaAdvanced Solid TumorsBiotheus+Mabwell BioPM8001 2021/11/17Phase ILung Cancer
2022/03/09Phase I/IIaAdvanced Solid TumorsBJ BioBJ-005
2023/03/17Phase Ib/IIHC, Solid Tumors
Youzhiyou BiopharmaY101D 2023/01/29Phase IAdvanced/Metastatic Pancreatic Cancer
2021/07/22Phase ISolid Tumors
2022/05/31Phase IAdvanced Solid TumorsGensun Bio+Kintor
PharmaGT90008
2021/06/02Phase IAdvanced Malignant TumorsQilu PharmaQLS31901
2022/07/01Phase ISolid TumorsTranscentaTST005
2022/12/09Phase I/IISolid TumorsHuahai Pharma+Huabo
Bio+Huaota BioHB0036
PD-L1, TIGIT 2022/05/30Phase I/IISolid Tumors or LymphomasFosun PharmaHLX301
2022/03/15Phase IAdvanced TumorsBiotheus+AdimabPM1022
2022/07/01Phase IAdvanced Solid TumorsSanhome PharmaSH006
2023/06/14Phase ILocally Advanced or Metastatic Solid TumorEpimab BioEMB-09PD-L1, OX40
2025/09/12Phase IIAdvanced Non-Small Cell Lung Cancer
3SBioSSGJ-706PD-1, PD-L1 2025/11/18Phase IIGastrointestinal Cancers
2024/07/25Phase IAdvanced Malignancy
2024/02/14Phase ISolid Tumor | HNSCC | RCC | CRCSparx BioSPX-303PD-L1, LILRB2
Notes:
(1) The clinical stage refers to the latest clinical trials as well as the first posted date.
(2) First posted date refers to the date on which the study record was first available on Chinadrugtrials.org.cn
or Clinicaltrials.gov .
(3) ccRCC refers to Clear Cell Renal Cell Carcinoma; AML refers to Acute Myeloid Leukemia; and MDS refers
to Myelodysplastic Syndrome.
(4) Company information is from the Company, and industry information is as of the Latest Practicable Date.
Clinical Limitations of Current PD-1/PD-L1 Treatment
Although the emergence of PD-1/PD-L1 inhibitors has brought new treatment for many
cancer patients, the tumor cells and tumor micro-environment can limit the effect of
PD-1/PD-L1 inhibitors, and there are only limited number of patients can benefit from these
drugs. In addition, the resistance of PD-1/PD-L1 inhibitors brings new challenges to patients
who fail to achieve therapeutic effect.
 Limited Number of Benefited Patients
Immune regulation targeting PD-1 and PD-L1 is affected by a variety of immune
signaling pathways, including Src homology-2 protein tyrosine phosphatase signaling
pathway, INF /H9253-JAK-STA T signaling pathway, etc.. Although significant and lasting
effects have been achieved in some patients, the overall response rate is relatively low in
patients receiving treatment. The monotherapy response rate of PD-1/PD-L1 is rarely
INDUSTRY OVERVIEW
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higher than 29%, which means that about 71% of patients with PD-1/PD-L1 reactive
cancer need to seek other treatments. In addition, the therapeutic effect of PD-1/PD-L1
inhibitors is usually related to tumor immune micro-environment (including infiltration of
CD8
+ T lymphocytes in tumor tissue, and expression of PD-L1), tumor immunogenicity
(including tumor mutation load, clonal neoantigen load, and microsatellite status) and
tumor gene mutation. These factors generally vary among patients, and the therapeutic
effect is also different.
 PD-1/PD-L1 Resistance
Even though immune checkpoint blockade targeting PD-1/PD-L1 has a promising
therapeutic efficacy in different tumors, a majority of patients acquired resistance during
treatment caused by the activation of alternative immune checkpoints.
In light of the clinical limitations of anti-PD-1/PD-L1 monotherapy, there is a growing
trend towards combination therapies and bispecific antibodies to circumvent resistance to
PD-1/PD-L1 blockade.
Recent Developments of PD-1/PD-L1 Treatment
The number of clinical trials for combination therapies has surged, with therapies
targeting VEGF and CTLA-4, showing better results than single treatments. The FDA has
approved multiple PD-1/PD-L1 combination therapies, for example, nivolumab (PD-1
antibody) and ipilimumab (CTLA-4 antibody) combination as first-line treatment for adult
patients with pleural mesothelioma who are not candidates for surgery. There are more
PD-1/PD-L1 combination therapies are anticipated to be approved, which will enhance the
efficacy of cancer treatment.
New explorations on mechanism of action for PD-1/PD-L1 treatment have surged through
the emerging bispecific antibodies. Dual targeting of discrete checkpoints, such as CD47,
PD-1/PD-L1 or CTLA-4, can be synergistic with regard to their anti-tumor effects. BsAbs
further differentiate from mono-specific approaches by engaging surface targets across two
different cell types (i.e., trans-binding), on the same cell surface (i.e., cis-binding), or soluble
proteins at or near the cell surface. In terms of cis-binding, relative cell surface expression
levels can be exploited to enhance cell binding selectivity through the adjustment of binding
arm affinities. Currently, there are two approved PD-1 bispecific antibody drug.
OVERVIEW OF CTLA-4 ANTIBODY DRUG MARKET
Mechanism of Action of CTLA-4
CTLA-4 is a protein receptor expressed constitutively on T cells and Tregs that functions
as an inhibitory immune checkpoint and down-regulates immune responses. The immune
system’s detection and elimination of cancer cells are facilitated in part by a subset of T cells
known as Teff cells. The effectiveness of Teff cells in detecting and eliminating cancer cells
INDUSTRY OVERVIEW
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--- page 163 ---
partly depends on other T cells known as Tregs, which could suppress immune function. Tregs
interact with Teff cells and produce molecules that reduce the activity of Teff cells. The key
to the immune regulation function of CTLA-4 is to control T cells activating via the inhibitory
function of Tregs.
Activation of T cells requires two signals. One is the binding of the T cell receptor to the
MHC-antigen peptide complex presented by antigen presenting cells. The other one is the
binding of B7 molecules on the APC to the co-stimulatory molecule CD28 on the surface of
T cells. With higher affinity than CD28, inhibitory CTLA-4 binds to B7 ligands on antigen
presenting cells and provides a brake for T cell activation. Anti-CTLA-4 antibodies were
proposed to release brakes of naïve T cells and allow them to be activated in the lymphoid
organs and then migrate to tumors to cause tumor rejection.
Selective depletion of Tregs in the tumor micro-environment results in increased tumor
immunity. Higher levels of CTLA-4 on intratumoral Tregs allow their selective depletion by
anti-CTLA-4 antibodies, through antibody-dependent cellular phagocytosis by macrophages
and/or antibody-dependent cellular cytotoxicity by NK cells. In addition, the anti-tumor effect
induced by the binding of the Fc terminus of anti-CTLA-4 antibodies to Fc receptors (Fc /H9253Rs)
has been a research hotspot in recent years. Anti-CTLA-4 antibodies with strong Fc /H9253R binding
ability can inhibit tumor growth and drive immune remodeling, which is not only caused by
Treg depletion and CTLA-4 blockade, but also by Fc /H9253R binding and type I interferon.
Mechanism of actions of IgG1 type anti-CTLA-4 mAb described thus far include blockade of
CTLA-4 binding to its ligands of CD80/CD86 on antigen presenting cells, ADCC-/ADCP-
mediated depletion of tumor-infiltrate Treg via its Fc function and the remodeling of innate
immunity in tumor micro-environment through Fc /H9253R-engagement.
The diagram below illustrates the mechanism of action of CTLA-4:
B7
Tc e l l
B7
CTLA-4
Treg
FcR
CTLA-4
ADCC
F
c
R
C
T
L
A
-
A
A
 4 ADCP
Anti-CTLA -4
Tumor micro-environment
TCR
MHC
Tc e l l
CD28 CTLA-4TCR
B7
B7
MHC
Anti-CTLA -4
Tumor micro-environment
Teff
Killing
Cancer cell
Naïve T
activation
priming
NK cell Macrophages
APC
CD28
Source: Literature Research, Frost & Sullivan Analysis
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Global and China CTLA-4 Antibody Drug Market Size
As of the Latest Practicable Date, there are two CTLA-4 monoclonal antibody drugs
approved on the market. According to the F&S Report, the global CTLA-4 antibody drug
market has grown from US$1.5 billion in 2019 to US$3.2 billion in 2024, with a CAGR of
16.3%. The global CTLA-4 antibody drug market is expected to reach US$12.4 billion in 2030,
and US$23.6 billion in 2035 with a CAGR of 25.5% from 2024 to 2030 and a CAGR of 13.8%
from 2030 to 2035. In terms of the China market, it started from US$0.3 billion in 2024 and
is expected to reach US$0.7 billion by 2030, with a CAGR of 19.0% from 2024 to 2030.
Following fast expansion, China market is expected to reach approximately US$1.8 billion by
2035, with a CAGR of 19.1% from 2030 to 2035. The chart below illustrates the global
CTLA-4 antibody drug market size for the periods indicated:
Global CTLA-4 Antibody Drug Market, 2019-2035E
0.1 0.2 0.3 0.3 0.3 0.4 0.5 0.6 0.7 0.9 1.1 1.3 1.5 1.8 1.5 1.7 2.0
2.1 2.4 2.9 3.4 3.5 4.7 6.5 9.1 11.7 13.6 15.6 17.7 19.8 21.9
1.5 1.7 2.0 2.2 2.6 3.2 3.7 3.8 5.0
7.0
9.6
12.4
14.5
16.7
19.0
21.4
23.6
2019 2020 2021 2022 2023 2024 2025E 2026E 2027E 2028E 2029E 2030E 2031E 2032E 2033E 2034E 2035E
China RoW
Billion USD
CAGRPeriod GlobalRoWChina
16.3%14.4%-2019-2024
25.5%26.0%19.0%2024-2030E
13.8%13.4%19.1%2030E-2035E
Source: Frost & Sullivan analysis
Note: Market size for CTLA-4-targeted drugs, including monoclonal antibody, bispecific antibody, antibody
conjugate drug (ADC), fusion protein.
Entry Barriers of CTLA-4 Antibody Drug Market
 Toxicity and Safety Concerns: CTLA-4 antibody inhibitors, such as ipilimumab, are
known to cause significant irAEs, which can be associated with substantial morbidity and
mortality. These side effects limit the therapy’s applicability and require careful
management, posing a barrier to the development and adoption of new CTLA-4 antibody
drugs.
 Limited Efficacy: The value of anti-CTLA-4 antibodies in cancer therapy is well
established. However, the broad application of currently available anti-CTLA-4
therapeutic antibodies is hampered by their narrow therapeutic index. It is therefore
challenging to develop the next generation of anti-CTLA-4 therapeutics with improved
safety and efficacy. Response rates to CTLA-4 monotherapies are approximately 10.9%,
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which are generally lower compared to PD-1/PD-L1 inhibitors. This lower efficacy can
make it challenging for new CTLA-4 drugs to demonstrate superior or non-inferior
outcomes in clinical trials, particularly when compared to established treatments.
 Competition from Established Therapies: The market for cancer immunotherapies is
already saturated with established PD-1/PD-L1 inhibitors, which have proven efficacy
and a more favorable safety profile for some patient populations. This competition makes
it difficult for new CTLA-4 targeting therapies to gain a foothold.
Growth Drivers of CTLA-4 Antibody Drug Market
 Continuous Expansion of Indications to Address Unmet Clinical Needs: Many cancer
patients lack access to the CTLA-4 antibody drugs, creating significant unmet needs. As
indications expand, more patients will benefit, driving growth in the CTLA-4 antibody
drug market. Looking ahead, the focus of CTLA-4 drug development will continue to be
on expanding indications to address unmet clinical needs, providing broader patient
access to these therapies.
 Enhancement of Drug Efficacy: CTLA-4 antibody drugs have achieved an overall
response rate of 39% in metastatic NSCLC treatments, reflecting their superior anti-tumor
efficacy. Continued advancements in antibody technology and therapeutic strategies are
expected to further improve objective response rates. This exceptional efficacy not only
enhances clinical outcomes but also increases physicians’ confidence in prescribing these
drugs, thus fueling the market’s expansion.
 CTLA-4 Bispecific as a Development Trend: CTLA-4 is a pivotal target in immune
checkpoint inhibition, playing a crucial role in tumor immunotherapy. With a deepening
understanding of the tumor micro-environment, CTLA-4 bispecific drugs have emerged
as a promising development trend. These drugs simultaneously target CTLA-4 and
additional pathways, such as PD-1, PD-L1, and CD47, aiming to enhance therapeutic
efficacy while minimizing side effects. The approval of Akeso’s cadonilimab, the first
global CTLA-4 bispecific drug, represents a significant breakthrough, heralding a new era
of innovation and opportunity in dual-target drug development.
 Advancement in Treatment Line for Improved Accessibility: The combination of
CTLA-4 and PD-1 antibody therapies is endorsed by the American Society of Clinical
Oncology as a first-line treatment for non-small cell lung cancer and hepatocellular
carcinoma. Additionally, the Chinese Society of Clinical Oncology recommends these
therapies as a second-line treatment for cervical cancer. As more CTLA-4 drugs are
integrated into first- and second-line cancer treatments, patients’ access to these
life-saving therapies is expected to increase significantly, further improving treatment
accessibility and availability across broader patient populations.
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Global (including China) Approved CTLA-4 Bispecific Antibody Drugs
Currently, Kaitanni is the only approved CTLA-4 bispecific antibody drug.
Target Drug
Name Company Indications Line of
Treatment
Combination
Therapy
Approval
Date Dosage Country
Medical
Insurance
Price per
Treatment
Cycle
PD-1,
CTLA-4
Cadonilimab
Kaitanni® Akeso
Cervical Cancer
2L Monotherapy 2022/06/28 This product is
administered via
intravenous infusion. The
recommended dose is 6
mg/kg, given every 2 weeks
until disease progression or
intolerable toxicity occurs.
China B
approximately
RMB7,500
1L
Combined with
platinum based
chemotherapy and
Bevacizumab, or
combined with or
without
Bevacizumab
2025/05/27
GC/GEJC 1L
Combination with
fluoropyrimidine
and platinum-
based
chemotherapy
agents
2024/09/26
This product is
administered by
intravenous infusion. The
recommended dose is 10
mg/kg, given every 3 weeks
until disease progression or
intolerable toxicity occurs.
approximately
11,000
Source: NMP A, FDA, Company Website, Literature Review, Frost & Sullivan Analysis
Note:
(1) Industry information is as of December 8, 2025. 2. GC refers to Gastric Cancer; GEJC refers to
Gastroesophageal Junction Cancer .
Competitive Landscape of CTLA-4 Targeted Bispecific Antibody/Bifunctional Fusion
Protein Pipeline
Currently, there are 13 CTLA-4 targeted bispecific antibody drugs under the clinical
development globally. HX044 is the only CTLA-4/CD47 bispecific antibody/bifunctional
fusion protein under the clinical development globally.
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Global (excluding China) Competitive Landscape of CTLA-4 Targeted Bispecific
Antibody/Bifunctional Fusion Protein Pipeline
First Posted
Date Clinical StageIndicationsCompanyDrug Name
/CodeTarget
2024/10/21Phase I/IIaAdvanced Solid Tumor MalignanciesHanx BioHX044CTLA4, CD47
2023/08/09Phase IIINSCLC
AstraZenecaVolrustomig
/MEDI5752
CTLA4ͫPD-1
2023/10/12Phase IIILocally Advanced Cervical cancer
2023/10/24Phase IIIUnresectable Pleural Mesothelioma
2023/11/13Phase IIIHNSCC
2025/06/02Phase IIIAdvanced Clear Cell Renal Cell Carcinoma
2023/01/27Phase IILocally Advanced Unresectable or Metastatic Gastric or Gastroesophageal Junction Adenocarcinoma
2023/03/20Phase IIHCC, BTC
2023/06/05Phase IIAdvanced Solid Tumor
2025/01/27Phase IIMetastatic Colorectal Cancer
2020/08/21Phase IRCC
2023/04/20Phase ISoft Tissue Sarcoma
2021/08/13Phase IImCRPC
Xencor+Icon BioVudalimab
2021/09/02Phase IIAdvanced Gynecologic and Genitourinary Malignancies
2022/03/17Phase IIBTC
2022/07/22Phase IIAdvanced Cervical Cancer
2023/12/15Phase I/IINSCLC
2022/07/26Phase IIMetastatic Cancer, Cervical Cancer
MacroGenicsLorigerlimab
/MGD019
2023/05/08Phase IIProstate Cancer
2025/07/18Phase IIColorectal Cancer With Radiographic Occult Molecular Residual Disease
2025/07/18Phase IIColorectal Cancer
2022/03/24Phase IHCC, RCC, OC, Pancreatic Ductal Carcinoma
2020/05/07Phase IICervical Cancer
AkesoCadonilimab 2025/01/21Phase IIAdvanced Liver Cancers
2022/07/08Phase I/IIExtensive Stage Small Cell Lung Cancer
2019/02/21Phase I/IIAdvanced Solid Tumors
GI Innovation
/ Simcere
Pharmaceutical
SIM0323CTLA-4,
IL2/15Rβγc
2021/07/27Phase I/IIUnresectable Locally Advanced or Metastatic CancerSalubris
BiotherapeuticsJK08
2024/10/02Phase I/IIAdvanced And/ or Metastatic Solid TumorsEgle TherapeuticsEGL-001CTLA-4, IL2R
2019/02/21Phase IAdvanced Solid TumorsXencorXmAb 841
(Bavunalimab)CTLA-4, LAG3
Source: CDE, Clinical trial, Company Website, Literature Review, Frost & Sullivan Analysis
Notes:
(1) The clinical stage refers to the latest clinical trials as well as the first posted date.
(2) First posted date refers to the date on which the study record was first available on Chinadrugtrials.org.cn
or Clinicaltrials.gov .
(3) Company information is from the Company, and industry information is as of the Latest Practicable Date.
(4) HNSCC refers to head and neck squamous cell carcinoma; NSCLC refers to non-small cell lung cancer; RCC
refers to renal cell carcinoma; GC refers to gastric cancer; BC refers to breast cancer; OC refers to ovarian
cancer; TNBC refers to triple negative breast cancer; HCC refers to hepatocellular carcinoma; BTC refers to
biliary tract cancer; EC refers to endometrial cancer; mCRPC refers to metastatic castration-resistant prostate
cancer; CRC refers to colorectal cancer; UC refers to urothelial cancer; and ESCC refers to esophageal
squamous cell carcinoma.
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China Competitive Landscape of CTLA-4 Targeted Bispecific Antibody/Bifunctional Fusion
Protein Pipeline
First Posted
Date Clinical StageIndicationsCompanyDrug Name
/CodeTarget
2024/10/21Phase I/IIaAdvanced Solid Tumor MalignanciesHanx BioHX044CTLA-4, CD47
2022/08/08Phase IIIHCC
AkesoCadonilimab
CTLA4, PD-1
2022/10/19Phase IIINasopharyngeal Carcinoma
2023/07/13Phase IIINSCLC
2022/01/04Phase IIAdvanced/Metastatic Renal Cell Carcinoma
2022/06/24Phase IIAdvanced Ovarian Cancer
2023/02/18Phase IImCRC
2023/03/21Phase IIPancreatic Cancer
2023/04/21Phase IIAdvanced Endometrial Cancer
2023/06/27Phase IIVulvar Cancer
2023/09/04Phase IIHNHCC
2023/12/12Phase IIHER2-expression Locally Advanced or Metastatic Urothelial Carcinoma
2024/04/16Phase IIAdvanced Soft Tissue Sarcoma
2024/04/16Phase IITNBC
2024/05/06Phase IISCLC
2024/09/30Phase IIMelanoma
2025/12/02Phase IIEsophageal squamous cell carcinoma
2025/01/24Phase IIIRecurrent or Metastatic Cervical Cancer
AstraZenecaVolrustomig
/MEDI5752
2025/01/14Phase IIIAdvanced or Metastatic HNSCC
2024/12/27Phase IIIPleural Mesothelioma
2025/01/24Phase IIINSCLC
2023/02/01Phase IIGC
2023/03/24Phase IIBTC/HCC
2025/01/27Phase IIColorectal Cancer
2025/08/27Phase IIColorectal cancer
2023/08/23Phase IILocally Advanced or Metastatic Esophageal Cancer, Gastric Cancer, Colorectal Cancer
and Other Gastrointestinal Tumors
Biokin PharmaDanvilostomig
/SI-B003
2023/06/21Phase IISCLC
2023/07/10Phase IIAdvanced or Metastatic Non-small Cell Lung Cancer, Nasopharyngeal Carcinoma and
Other Solid Tumors
2023/07/28Phase IILocally Advanced or Metastatic Urothelial Carcinoma and Other Solid Tumors
2024/11/01Phase IIRecurrent or Metastatic HNSCC
2021/05/20Phase IAdvanced Solid TumorsKelun PharmaSKB337
CTLA-4, PD-L1
2020/07/27Phase IIIAdvanced Squamous NSCLC
AlphamabErfonrilimab
/ KN046
2021/12/03Phase IIIAdvanced Pancreatic Cancer
2019/04/25Phase IIAdvanced Unresectable or Metastatic ESCC
2020/08/20Phase IILocally Advanced HER2-positive Solid Tumors
2020/09/02Phase IIAdvanced HCC
2023/10/20Phase IIDigestive System Cancers
2020/11/03Phase I/IIAdvanced Gastrointestinal Tumors
2023/09/25Phase IAdvanced Solid TumorsShangjian BioSG1827CTLA-4, CD28
Source: CDE, Clinical trial, Company Website, Literature Review, Frost & Sullivan Analysis
Notes:
(1) The clinical stage refers to the latest clinical trials as well as the first posted date.
(2) First posted date refers to the date on which the study record was first available on Chinadrugtrials.org.cn
or Clinicaltrials.gov .
(3) Company information is from the Company, and industry information is as of the Latest Practicable Date.
(4) HNSCC refers to head and neck squamous cell carcinoma; NSCLC refers to non-small cell lung cancer; ICC
refers to intrahepatic cholangiocarcinoma; GC refers to gastric cancer; TNBC refers to triple negative breast
cancer; BTC refers to biliary tract cancer; and ESCC refers to esophageal squamous cell carcinoma.
Limitation of First Generation CTLA-4 Treatment
CTLA-4 is a pivotal target in immune checkpoint inhibitor, playing a crucial role in tumor
immunotherapy. The first generation anti CTLA-4 antibody is an immune checkpoint inhibitor
that enhances T cell activity and improves anti-tumor immune response. While CTLA-4
antibody drugs have proven effective, they can trigger irAEs, such as rashes and colitis, which
may lead to treatment discontinuation or compromise patient outcomes, and such dose-
dependent toxicity has hindered its potential application.
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Recent Development of Second Generation CTLA-4 Treatment
The primary mechanism of action for second-generation CTLA-4 antibodies involves the
clearance of tumor-infiltrated Tregs. This mechanism is based on the study that CTLA-4
inhibitors can deplete Tregs locally within tumors that express high levels of CTLA-4. This is
achieved through antibody-dependent cellular cytotoxicity (ADCC) and antibody-dependent
cellular phagocytosis (ADCP), which are mediated by the Fc receptor of the antibody. Many
second-generation CTLA-4 monoclonal antibodies are being developed using Fc segment
genetic engineering technology, thereby boosting the immune response to cancer cells. To
address the safety issues, numerous companies have endeavored to mitigate the toxicity of
CTLA-4 therapies through innovative approaches, such as developing acid-sensitive CTLA-4
inhibitors, refining antibody design, and employing bispecific antibodies.
In addition, with a deepening understanding of the tumor micro-environment, dual-target
CTLA-4 drugs have emerged as a promising development trend. These drugs simultaneously
target CTLA-4 and additional pathways, such as PD-1, PD-L1, and CD47, aiming to enhance
therapeutic efficacy while minimizing side effects. The mechanism of action of bispecific
anti-CTLA-4 antibodies, taking HX044 as an example, involves both CTLA-4 and CD47
targets and efficiently binds to Tregs, where co-high-expression of both targets occur, due to
cis-binding, resulting in depletion of Tregs as well as remodeling of tumor microenvironment
in favor of anti-tumor immunity. The dual engagement of these two targets helps to modulate
the balance between immune activation and suppression, which is important for achieving an
optimal anti-tumor response. The approval of Akeso’s cadonilimab, the first global bispecific
CTLA-4 drug, represents a significant breakthrough, heralding a new era of innovation and
opportunity in bispecific drug development.
OVERVIEW OF CD47/SIRP /H9251TARGETED DRUG MARKET
Overview and Mechanism of CD47/SIRP /H9251Targeting
CD47 is a kind of protein molecule expressed on the surface of many kinds of tumor cells,
and it plays a pivotal role in this balance by delivering a “don’t eat me” signal upon binding
to the SIRP /H9251receptor on macrophages. Through the “don’t eat me” signal delivered by the
CD47/SIRP /H9251signal pathway, tumor cells can activate the downstream pathway of
macrophages, inhibit the rearrangement of macrophage cytoskeleton, inhibit the phagocytosis
of macrophages on tumor cells, and escape the innate immunity system.
CD47/SIRP /H9251targeted drug works through multiple mechanisms, among which blocking
“don’t eat me” signal is the most important mechanism. Simple blockade of the CD47/SIRP /H9251
interaction could block the “don’t eat me” signal, but this only partially activate macrophages.
To fully activate them, it is necessary to activate receptors such as Fc /H9253Rs so that “eat me”
signal is generated. Efficient CD47/SIRP /H9251targeted drug can simultaneously release the
CD47/SIRP /H9251check and activate macrophages through Fc-Fc /H9253R interaction. The diagrams
below illustrate the mechanism of actions of CD47/SIRP /H9251pathway and its targeted drugs:
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Macrophage
SIRPα
Tumor cell
Don’t eat me
CD47
FcγR
CD47 “don’t eat me” signal
No drug
SIRPα
Don’t eat me
CD47
FcγR
Anti-CD47
/SIRPα fusion
protein
X
CD47 blocked
Anti-CD47 antibody
SIRPα
Don’t eat me
CD47
FcγR
Anti-SIRPα
X
SIRPα blocked
Anti-SIRPα antibody
Source: Literature Review, Frost & Sullivan Analysis
Global CD47 Targeted Therapies Market
Safety issues have been documented in literatures that the primary concerns around
CD47. Other than tumor cells, CD47 is also ubiquitously expressed on human red blood cells
and platelets. CD47-targeted agents are shown to cause blood toxicity in clinical trials, such
as anemia, thrombocytopenia and hemagglutination. In fact, a number of clinical-stage CD47
antibodies show severe strong red blood cell binding, leading to severe adverse effects, and
trial suspensions or termination. For details, see “Risk Factors — Risks Relating to the
Research and Development of Our Drug Candidates — Adverse events or undesirable side
effects caused by our drug candidates could interrupt, delay or halt clinical trials, delay or
prevent regulatory approval, limit the commercial profile of an approved drug, or result in
significant negative consequences following any regulatory approval” in this prospectus.
As of the Latest Practicable Date, there are no approved CD47 targeted drugs available,
and the first drug is expected to generate sales upon commercialization in 2026. It is expected
that the market will expand rapidly with approval of CD47 targeted innovative drugs. The
global market of CD47 therapies is projected to expand rapidly from US$0.2 billion in 2026
to US$4.9 billion in 2030, and further increase to US$25.9 billion in 2035 at a CAGR of 39.4%
between 2030 and 2035. China’s CD47 targeted therapies market is expected to grow at a
higher speed compared to the global market, which is expected to grow from US$0.1 billion
in 2028 to US$0.8 billion in 2030, and further reach US$4.8 billion in 2035 at a CAGR of
44.5% between 2030 to 2035.
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Global CD47 Targeted Therapies Market, 2019-2035E
0.1 0.3 0.8 1.3 2.2 3.0 3.9 4.8
0.2 0.4
0.9 2.1 4.2 7.0
10.4
14.0
17.5
21.1
0.2 0.4
1.0 2.5 4.9
8.3
12.6
17.0
21.4
25.9
2019 2020 2021 2022 2023 2024 2025E 2026E 2027E 2028E 2029E 2030E 2031E 2032E 2033E 2034E 2035E
China RoW
CAGRPeriod GlobalRoWChina
---2019-2024
---2024-2030E
39.4%38.4%44.5%2030E-2035E
Billion USD
Source: Frost & Sullivan analysis
Note: Market size for CD47-targeted drugs, including monoclonal antibody, bispecific antibody, antibody conjugate
drug (ADC), fusion protein.
Growth Drivers of CD47-Targeted Drug Market
 Bispecific Antibody and Fusion Protein: Compared with using multiple drugs,
specifically designed bispecific antibody and fusion protein would have more benefits.
The BsAbs targeting multiple antigens on the same type of target cell may increase the
therapeutic window of anti-cancer drugs by increasing potency and decreasing off-tumor
effects. At present, many pharmaceutical companies are undertaking relevant researches.
Bispecific antibodies of PD-1 and CTLA-4 have obtained good clinical trial data.
Bispecific antibody and fusion protein are expected to be a good choice of design in
CD47-targeted drug market.
 Indication Expansion: Although it has been proved that CD47 is widely expressed in
various solid tumor cells, the killing effect of macrophages on a wide range of solid
tumors have not yet been fully studied. Though the majority of the clinical evidence has
been accumulated around hematological tumor, few studies investigating solid tumors
have obtained good experimental results. As mentioned above, using bispecific antibody
or fusion protein could help get better treatment outcomes, and this could improve the
chance of CD47-targeted drugs being expanded to more tumor types. With the
investigation going deeper and accumulation of clinical data, it is expected that in the
future, CD47-targeted drugs will be expanded to be used in solid tumors, benefiting a
larger population.
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Competitive Landscape of CD47/PD-1, CD47/CTLA-4 and CD47/PD-L1 Targeted
Bispecific Antibody/Bifunctional Fusion Protein Pipeline
Global (excluding China) Competitive Landscape of CD47/PD-1, CD47/CTLA-4 and
CD47/PD-L1 Targeted Bispecific Antibody/Bifunctional Fusion Protein Pipeline
Our Core Product, HX009, is a bispecific antibody fusion protein targeting both CD47
and PD-1. According to the F&S Report, as of the Latest Practicable Date, HX009 stands out
with the leading position in respect of its clinical trial progress in the world among comparable
CD47 targeted bispecific antibody/bifunctional fusion protein products. The following chart
illustrates comparisons of clinical-stage CD47/PD-1, CD47/CTLA-4 and CD47/PD-L1
bispecific antibody/bifunctional fusion protein worldwide:
Target
Drug
Name/
Code
SIRPα
Fusion
Protein
Company Indications Clinical
Stage
First
Posted
Date
CD47, PD-1 HX009 Yes Advanced Solid Tumor Phase I 2019/09/20
CD47, CTLA4 HX044 Yes Advanced Solid Tumor Malignancies Phase I/II 2024/10/21
CD47, PD-L1
LB101 No LogicBio Advanced Solid Tumor Phase I/II 2023/04/20
BAT7104 No Bio-Thera Advanced Solid Tumor Phase Ib/II 2024/07/22
IBI322 No Innovent Advanced Malignant Tumors Lymphomas Phase I 2020/04/08
the Company
the Company
Source: CDE, Clinical trial, Company Website, Literature Review, Frost & Sullivan Analysis
Notes:
(1) The clinical stage refers to the latest clinical trials as well as the first posted date.
(2) First posted date refers to the date on which the study record was first available on Chinadrugtrials.org.cn
or Clinicaltrials.gov .
(3) The Company obtained the FDA Study May Proceed approval in relation to the phase Ib/II study of HX009
in the U.S. for treatment of DLBCL in May 2023.
(4) Company information is from the Company, and industry information is as of the Latest Practicable Date.
(5) B-NHL refers to B-cell non-Hodgkin lymphoma; NSCLC refers to non-small cell lung cancer; HNSCC refers
to head and neck squamous cell carcinoma; OC refers to ovarian cancer; GC refers to gastric cancer; BC refers
to breast cancer; LC refers to lung cancer; CLL refers to chronic lymphocytic leukemia; DLBCL refers to
diffuse large B-cell lymphoma; MCL refers to mantle cell lymphoma; and SLL refers to small lymphocytic
lymphoma.
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China Competitive Landscape of CD47/PD-1, CD47/CTLA-4 and CD47/PD-L1 Targeted
Bispecific Antibody/Bifunctional Fusion Protein Pipeline
Target
Drug
Name/
Code
SIRPα
Fusion
Protein
Company Indications Clinical Stage
First Posted Date/
CDE Acceptance
Date
CD47, PD-1 HX009 Yes the Company
TNBC IND 2024/12/06
Melanoma
BTC Phase II 2024/11/14
Relapsed/Refractory Lymphoma Phase I/II 2022/01/12
CTLA-4,
CD47 HX044 Yes the Company Advanced malignant solid tumor Phase I 2025/03/03
CD47,
PD-L1
6MW3211 No Mabwell Bio
Advanced Lung Cancer Phase II 2022/06/13
Advanced clear cell RCC Phase II 2022/06/28
Relapsed/Refractory Lymphoma Phase II 2022/07/04
AML/MDS Phase II 2023/01/31
Advanced Malignant Tumor Phase I/II 2021/08/24
IBC0966 Yes ImmuneOnco Advanced Malignancies Phase I/II 2021/07/08
IBI322 No Innovent
Advanced Malignant Tumor Phase I 2020/03/30
Malignant Hematological Tumor Phase I 2021/03/19
SG12473 No Shangjian Bio Advanc ed Malignant Tumor Phase I 2021/05/13
BAT7104 No Bio-Thera Advanced So lid Tumor Phase Ib/II 2022/02/22
SH009 No Nanjing Sanhome
Pharmaceutical
Advanced Solid Tumor Phase I 2025/04/02
NSCLC Phase I 2025/05/16
Source: CDE, Clinical trial, Company Website, Literature Review, Frost & Sullivan Analysis
Notes:
(1) The clinical stage refers to the latest clinical trials as well as the first posted date.
(2) First posted date refers to the date on which the study record was first available on Chinadrugtrials.org.cn
or Clinicaltrials.gov .
(3) Company information is from the Company, and industry information is as of the Latest Practicable Date.
Limitations and Potential Solutions of CD47-Targeted Drug Development
CD47 is a cell surface protein that acts as a key regulator of the tumour microenvironment
and represents a potential target for cancer therapy. It is found to be overexpressed in different
types of tumors and act as a “don’t eat me” signal, which contributes to immune evasion.
Macrophages are distributed in the micro-environment of tumors, and have been proved to
induce effective anti-tumor immune response via phagocytosis.
Although CD47-targeted drugs have great potential in activation of macrophages, there
are many concerns pertaining safety in development of CD47-targeted drugs, such as blood
toxicity, antigen-sink (a bioavailability phenomenon influenced by saturation of receptors
which results in high demand for dose level), on-target/off-tumor effects, and T cell apoptosis.
 Off-target Effects and Blood Toxicity: Safety issues have been the primary concerns
around CD47. Other than tumor cells, CD47 is also ubiquitously expressed on human red
blood cells and platelets. Growing studies are recognizing the toxicities associated to
targeting CD47, whose ubiquitous expression causes off-tumor killing of non-cancerous
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cells, especially red blood cells and platelets resulting in hemagglutination and anemia.
In fact, a number of clinical-stage CD47 antibodies show severe strong red blood cell
binding, leading to severe adverse effects, and trial suspensions or termination.
 Antigen-Sink: The antigen-sink effect of CD47-targeted drugs refers to the fact that due
to the widespread expression of CD47 on normal cells, the drug may require a larger
initial dose and/or frequent administration to effectively block CD47, which may affect
the concentration and efficacy of the drug on tumor cells. This effect may result in the
drug not reaching sufficient concentration on tumor cells, thereby reducing the
therapeutic effect.
 T Cell Apoptosis: CD47 is expressed on immature and mature T cells. Upon binding with
CD47 antibody, T cells may undergo apoptosis, for which reason antibody candidates
have to be screened and those have this activity have to be excluded.
The absence of any approved CD47-targeted drug to date is understood as the cumulative
result of specific clinical-development challenges, rather than as a definitive verdict on the
biological validity of the target itself. For example, on July 1, 2025, Pfizer announced the
termination of its Phase II trial evaluating maplirpacept in R/R DLBCL, explicitly attributing
the decision to enrollment feasibility rather than pharmacologic concerns. According to the
subsequent update on the U.S. federal clinical trials database, the study was closed due to the
“inability to recruit the planned number of subjects,” having enrolled only six patients since its
initiation in August 2023. Pfizer emphasized that the decision was not based on any safety or
efficacy findings. Notably, Pfizer continues to investigate maplirpacept’s potential in
combination strategies, with an ongoing Phase I/II trial pairing it with Roche’s bispecific
antibody glofitamab (Columvi) in the same DLBCL setting, which remains active as of the
latest update. In contrast, the discontinuation of Gilead Sciences’ magrolimab program in
hematologic cancers was decisively driven by unfavorable clinical data. On February 7, 2024,
Gilead announced that it had discontinued the Phase III ENHANCE-3 study in acute myeloid
leukemia and that the U.S. FDA had placed all magrolimab studies in myelodysplastic
syndromes and acute myeloid leukemia on full clinical hold. This decision was based on
interim analysis which indicated futility and an observed increased risk of death. The detailed
final analysis, later presented at the European Hematology Association Congress on June 14,
2024, substantiated these concerns: with a median follow-up of 7.6 months in the magrolimab
arm versus 7.4 months in the control arm, the combination of magrolimab with venetoclax and
azacitidine demonstrated a median overall survival of 10.7 months compared to 14.1 months
with the control regimen (hazard ratio, 1.178; 95% confidence interval, 0.848–1.637). The
complete response rate within six treatment cycles was also lower in the magrolimab arm
(41.3% vs. 46.0%). Furthermore, the addition of magrolimab led to a higher incidence of fatal
adverse events (19.0% vs. 11.4%), primarily driven by grade 5 infections (11.1% vs. 6.5%) and
respiratory events (2.6% vs. 0%). These results, which aligned with earlier futility signals from
the ENHANCE and ENHANCE-2 trials, led Gilead to discontinue all development of
magrolimab in blood cancers. While several CD47-directed candidates have faltered, such
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failures do not negate the pathway’s documented ability to unleash macrophage-mediated
anti-tumor immunity; instead, they highlight that the clinical potential of CD47-targeted agents
depends largely on the specific design and execution of each drug program.
Possible solutions to the above safety concerns include (i) efficient discovery and
development platforms to screen appropriate molecules. Such platforms help to figure out
structures that have no or minimal effect on T lymphocytes and red blood cell beforehand,
while maintaining high efficacy; (ii) specific administration dosing such as priming dosing
strategy (i.e., a lower initial dose followed by a higher maintenance dose) to reduce the
frequency of adverse events; and (iii) greater drug delivery methods like tumor-targeting
nano-particles to enhance targeted delivery of drugs. In general, companies with in-depth
understanding of underlying science and capability to develop highly efficient antibody
screening platform will be more competitive compared with the peers. Currently, such
companies are also exploring possible solutions through synergistic effects achieved from
targeting additional targets such as PD-1. For example, HX009 by the Company is a
specifically designed bifunctional anti-PD-1 antibody SIRP /H9251fusion protein, which is designed
to improve both efficacy and safety over the two respective single-targeting immune
checkpoint inhibitors. As documented in literatures, HX009 is capable of inducing stronger T
cell activation than anti-PD-1 mAb alone via additional PD-1-driven, cis-binding to surface
PD-1 and CD47 on T cells. Also, such mechanism is capable to significantly reduce CD47
binding affinity through SIRP /H9251domain, and therefore may address the CD47-related safety
issues.
Synergistic Analysis of CD47 with Other Targets
CD47 monoclonal antibody can block the CD47/SIRP /H9251pathway and alleviate the
inhibition of macrophage phagocytosis. Blocking CD47 increases macrophage recruitment to
tumors. Phagocytosis following anti-CD47 treatment can cause the secretion of chemokines
and cytokines that recruit additional immune cells to tumors, enhancing the immune response.
Based upon such understanding, additional targets were attempted to be added on top of CD47
pathway target, aiming to achieve a synergistic effect, which is expected to have a stronger
anti-tumor effect.
For drugs that target both PD-1 and CD47, the anti-CD47 antibody can block the
CD47/SIRP /H9251axis and activate the phagocytosis of tumor cells by macrophages, thereby
achieving the purpose of curing tumors. In addition, anti-PD-1 antibodies block the binding of
PD-1 to its ligand PD-L1 or PD-L2, thereby reversing the tumor immune micro-environment,
restoring the anti-tumor activity of T cells, and inhibiting tumor growth. Meanwhile, PD-1 has
little systemic expression, but is expressed in tumor micro-environment, so bispecific antibody
targeted PD-1 has tumor targeting effect, than bring more binding to CD47 in tumors. HX009
developed by our Company, constructed by grafting the extracellular CD47-binding domain of
human SIRP /H9251protein, could have high avidity (i.e., apparent affinity) to bind to CD47 on Teff
because of cis-binding, where high affinity PD-1 binding would be the driver binder of the
BsAb. The SIRP /H9251domain has significantly reduced CD47 binding affinity, aiming at reducing
binding to CD47
+ red blood cells and megakaryocytes to minimize hemotoxicity, and also to
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reduce the anti-CD47 antigen sink effect due to the broad expression of CD47 among normal
tissues. In this way, innate immunity and cellular immune responses are improved through
multiple links. Therefore, bispecific antibodies targeting both human PD-1 and CD47 could
enhance anti-tumor activity and reduce hemotoxicity based on rational design.
For drugs that target both CD47 and CTLA-4, it could also block CD47, the “don’t eat
me” signal, and take advantage of the high expression of CTLA-4 on Tregs and abundant Fc
receptor — expressing active phagocytes inside the tumor micro-environment, causing
synergistic antitumor immunity/efficacy and avoid both peripheral irAE and hemotoxicities.
Depletion of Tregs is an attractive strategy to promote antitumor immunity. One strategy that
could deplete Treg cells is blockade of the “don’t eat me” signal, CD47, which prevents Treg
cells from being targets of phagocytosis. The CTLA-4 antibody also possesses the ability to
deplete Treg cells. HX044 developed by our Company efficiently binds to Treg, where
co-high-expression of both targets occur, due to cis-binding, resulting in depletion of Tregs as
well as remodeling of tumor micro-environment in favor of anti-tumor immunity, significantly
more so than anti-CTLA-4 monoclonal antibody, as clearly demonstrated in the preclinical
models.
OVERVIEW OF AUTOIMMUNE DISEASE AND OX40-BASED MECHANISM
Overview of Autoimmune Disease
An autoimmune disease is a condition in which the body’s immune system mistakenly
attacks the body. There are more than one hundred different types of autoimmune disorders,
which can affect almost any part of the body, including the heart, brain, nerves, muscles, skin,
eyes, joints, lungs, kidneys, glands, the digestive tract, and blood vessels.
Autoimmune diseases can be divided into organ-specific and systemic autoimmune
diseases based on the self-antigens targeted by immune cells. The exact underlying
pathophysiology of these illnesses is still unknown, while autoimmune diseases arise in the
context of a break in the immune tolerance to self. The mechanisms for the abrogation of
immune self-tolerance appear to be multifactorial, including genetic and environmental, which
will lead to unregulated immune activation against self-antigens and subsequent tissue
destruction. B cells and T cells recognize self-antigens and dominate the phenotype of the
patient with autoimmunity, although other immune components including antigen-presenting
cells and complement are involved in various steps from initiation of the autoimmune response
to tissue destruction.
The global autoimmune disease therapeutics market is roughly to be valued at US$143.1
billion in 2024. Most importantly, it’s anticipated that the autoimmune disease market will
keep growing due to an increasing prevalence of autoimmune diseases, newly developed
diagnostics technologies, rising awareness of autoimmune diseases, urgent calls for novel
therapeutics, etc. Therefore, the global autoimmune disease therapeutics market is expected to
grow at a value of US$234.8 billion by 2035 with a CAGR of 4.6% during the forecast period.
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Treatment Revolution for Autoimmune Diseases
Treatments with anti-inflammatory agents were generally effective for alleviating of pain,
fever, and inflammatory responses, but were limited to treating the symptoms of the disease.
Gradually, treatments with targeted biologics were developed, which target the underlying
sources of autoimmune disease, and therefore improve physical functioning and prevents
irreversible damage, making disease remission possible.
Mechanism of Action of OX40
OX40 is a type I transmembrane glycoprotein, and a member of the NGFR/TNFR
superfamily with co-activation function, which is a critical co-stimulator of T cell responses.
OX40 plays an important role in memory T cell formation. OX40 is transiently induced by
signaling following T-cell receptor engagement after antigen recognition, peaking 48 to 72
hours in activated T cells, including activated CD4
+ and CD8 + T cells, as well as in neutrophils,
natural killer cells and natural killer T cells. OX40L (the ligand for OX40) is also a member
of the TNFR superfamily. OX40L is mainly expressed on activated antigen-presenting cells,
such as dendritic cells, activated B cells, and macrophages. Apart from antigen-presenting
cells, OX40L also expressed on hematopoietic cells such as activated NK cells, mast cells or
the responding CD4
+ T cells, and non-hematopoietic cells. The diagram below illustrates the
mechanism of action of OX40:
Naïve T cell
TCRMHC
APC(DC)
CD40LCD40
CD28CD80/86
Activated T cell
TCR
MHC
OX40 OX40L
Activation
(48-72h)
OX40 OX40L
After leaving DCs
Bc e l l
NK cell
Activated CD4
+ T cell
Endothelial cell
Mast cell
APC
Anti-OX40
Immune activity
As illustrated in the diagrams, the OX40 signals to activated OX40-expressing T cells are
first provided by professional antigen-presenting cells during 48 to 72 hours after antigen
recognition. After the first interaction, the OX40-expressing T cells may leave DCs and interact
with other OX40L-expressing cells during the effector phase, such as B cells, nature killer
cells, activated CD4
+ T cells, endothelial cells, or mast cells, which results in the multi-channel
activation of T cells through OX40-OX40L signaling. OX40-OX40L blockade may ameliorate
autoantigen-specific T cell responses and reduce immune activity in autoimmunity diseases.
Blocking OX40-OX40L signaling transduction has produced strong therapeutic effects in
clinical trial of autoimmune and inflammatory diseases as well as demonstrated encouraging
anti-inflammation activities in atopic dermatitis in clinical trials. On September 24, 2024,
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Amgen announced the success of its Phase III trial of OX40 monoclonal antibody rocatinlimab
for the treatment of atopic dermatitis, which will mark the debut of the first OX40-targeting
drug on the market, simultaneously leading a novel mechanism of action within
immunotherapy. This development heralds a new era in the research and development of
OX40-directed therapeutics.
SELECTED INDICATIONS ANALYSIS
Lymphoma
Lymphomas are hematologic cancers involving lymphoceles of the immune system.
According to the F&S Report, China incidence of lymphoma has increased from 80,000 in
2019 to 88,700 in 2024 with a CAGR of 2.1%. It is estimated to be 99,200 in 2030 and 108,000
in 2035 with a CAGR of 1.9% and 1.7% respectively. Meanwhile, global incidence of
lymphoma has increased from 602,600 in 2019 to 675,400 in 2024 with a CAGR of 2.3%. It
is estimated to be 743,400 in 2030 and 815,000 in 2035 with a CAGR of 1.6% and 1.9%
respectively.
The two main categories of lymphomas are Hodgkin’s lymphomas and the NHL, and NHL
accounts for around 90% of lymphoma with varieties of subtypes. NHL is an umbrella term for
a group of independent diseases with strong heterogeneity, which develop in the lymphatic
system. According to the F&S Report, China incidence of NHL has increased from 75,800 in
2019 to 84,200 in 2024 with a CAGR of 2.1%. It is estimated to be 94,500 in 2030 and 103,500
in 2035 with a CAGR of 1.9% and 1.8% respectively. Meanwhile, global incidence of NHL has
increased from 521,500 in 2019 to 588,800 in 2024 with a CAGR of 2.5%. It is estimated to
be 652,400 in 2030 and 718,900 in 2035 with a CAGR of 1.7% and 2.0% respectively.
Epstein-Barr virus (EBV) is a DNA virus belonging to the human herpesvirus /H9253
subfamily, capable of infecting the host’s B lymphocytes as well as T cells and NK cells. EBV
infection can lead to a variety of lymphocyte proliferative diseases, including non-neoplastic
proliferative diseases and neoplastic diseases. EBV
+ accounts for approximately 16% of NHL
cases. R/R EBV + NHL is a type of non-Hodgkin lymphoma caused by EBV infection, where
the cancer either relapses (returns after initial treatment) or becomes refractory (stops
responding to treatment). NHL can be classified into B-cell and T-cell types, and is a cancer
that originates from B lymphocytes. It is a B-cell type NHL. One of the major causes of
DLBCL is EBV virus infection.
According to the F&S Report, global incidence of EBV
+ NHL has increased from 83.4
thousand in 2019 to 94.2 thousand in 2024 with a CAGR of 2.5%, and it is estimated to be
104.4 thousand in 2030 and 115.0 thousand in 2035 with a CAGR of 1.7% and 2.0%
respectively. Meanwhile, China incidence of EBV
+ NHL has increased from 12.1 thousand in
2019 to 13.5 thousand in 2024 with a CAGR of 2.1%, and it is estimated to be 15.1 thousand
in 2030 and 16.5 thousand in 2035 with a CAGR of 1.9% and 1.8% respectively. For the second
line EBV
+ NHL that targeted by our HX009, the number of patients in 2024 was approximately
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4.4 thousand in China and 33.6 thousand globally. In China, around 81% of advanced R/R
EBV+ NHL received further treatment and the treatment rate is around 41%. Globally, the
corresponding first line and second line treatment rate are about 85% and 42%, respectively.
Market Size
According to the F&S Report, from 2019 to 2024, the global lymphoma market has
increased from US$16.7 billion to US$24.0 billion, representing a CAGR of 7.5%.
Furthermore, the rapid increase in global lymphoma market will continue in the near future.
The global lymphoma market is forecasted to reach US$57.6 billion and US$89.1 billion by
2030 and 2035 respectively, which represents a CAGR of 15.7% from 2024 to 2030 and a
CAGR of 9.1% from 2030 to 2035. The market of lymphoma in China reached US$3.2 billion
in 2024, the market would enlarge to US$8.3 billion and US$13.0 billion by 2030 and 2035
with the CAGR of 17.4% and 9.5% respectively. The chart below illustrates the historical and
forecasted global lymphoma market size in the periods indicated:
Global Historical and Forecasted Lymphoma Market, 2019-2035E
3.22.72.51.7 2.21.5
2019 2020 2021 2022 2023 2024 2025E 2026E 2027E 2028E 2029E 2030E 2031E 2032E 2033E 2034E 2035E
4.6 5.5 6.5 7.4 8.3 9.3 10.3 11.2 12.1 13.015.2 15.4 16.2 17.2 18.6  20.8 24.1 28.0 32.3 37.4  43.1 49.3 55.2 60.8 66.1 71.2 76.0
16.7 17.2 18.4 19.6 21.4 24.0 28.0
32.6
37.9
43.9
50.5
57.6
64.5
71.1
77.4
83.4
89.1
Billion USD
2030E-2035E
2024-2030E
2019-2024
9.5%
17.4%
16.1%
9.1%
15.7%
7.5%
9.0%
15.5%
6.5%
Period CAGR
China RoW Total
China RoW
3.8
Source: Literature Review, Annual report, Expert interview, Frost & Sullivan Analysis
According to the F&S Report, from 2019 to 2024, the total EBV + NHL market in China
has increased from RMB0.3 billion to RMB0.5 billion, representing a CAGR of 10.1%.
Furthermore, the rapid increase in China’s EBV
+ NHL market will continue in the near future.
The total EBV + NHL market of China is forecasted to reach RMB1.6 billion and RMB2.8
billion by 2030 and 2035 respectively, which represents a CAGR of 19.7% from 2024 to 2030
and a CAGR of 11.7% from 2030 to 2035.
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Historical and Forecasted EBV + NHL Market in China, 2019-2035E
2019 2020 2021 2022 2023 2024 2025E 2026E 2027E 2028E 2029E 2030E 2031E 2033E 2032E 2034E 2035E
0.3 0.3 0.4 0.4 0.5 0.5
0.7 0.8
1.0
1.2
1.4
1.6
1.8
2.0
2.3
2.5
2.8
Billion RMB
Period CAGR
China
2019-2024
2024-2030E
2030E-2035E
10.1%
19.7%
11.7%
Source: Literature Review, Annual report, Expert interview, Frost & Sullivan Analysis
Unmet Clinical Needs
 Drug resistance: The current treatment for NHL generally includes radiation therapy,
chemotherapy, stem cell transplantation and biologics. However, approximately 50% of
NHL patients will eventually experience disease progression due to drug resistance,
leading to r/r NHL, which remains a challenge with limited effective treatment options.
 High recurrence and limited salvage therapy: For r/r B-cell NHL, CD20-targeted
therapy is still primarily recommended, but it is generally associated with limited efficacy
because of drug resistance and side effects such as infusion-related reactions. For r/r
T cell NHL, though novel immunotherapies (PD-1/PD-L1 inhibitors) and targeted
therapies have been developed, the current treatment options are still mainly limited to
chemotherapy. Although some lymphoma patients can be cured, about 60% of patients are
still facing the problem of relapse and refractory treatment. It is rare for lymphoma
patients to have effective treatment drugs. For patients who are ineligible or unable to
undergo transplantation due to advanced age, poor physical condition, comorbidities,
organ dysfunction, and/or lack of response to salvage chemotherapy, the available options
for salvage therapy are limited, leading to an overall poor prognosis.
 Limited Treatment for EBV
+ NHL: Tumors associated with EBV are often malignant,
with poor prognosis and difficult treatment. Traditional surgery, chemotherapy, and
radiotherapy have poor efficacy against these malignant tumors and can lead to severe
adverse reactions. Currently, there are no specific drugs targeting EBV
+ NHL on the
market. Immune checkpoint inhibitors show potential in EBV + NHL. For example,
nivolumab appears safe in patients with EBV-associated lymphoproliferative disorders
and NHL without unexpected toxicities in a phase II study.
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China Competitive Landscape of EBV + NHL Targeted Therapy Pipelines
There are 12 pipelines of targeted therapy pipelines for EBV + NHL treatment in China.
ModalityFirst Posted
Date Clinical StageTreatment
Line
Treatment
StrategyIndicationsCompanyDrug Name
/CodeTarget
Antiboby-based
fusion protein2022/01/22Phase II2L+MonoR/R LymphomaHanx BioHX009CD47,PD-1
CAR-T2022/07/08Phase III2L+MonoDLBCL, PMBCLJW TherapeuticsRelmacabtagene
Autoleucel
CD19
mAb2024/04/28Phase III2L+Combo with
ChemotherapyDLBCL
Baxter Oncology
GmbH, InnoCare, Inset
Pharmaceutical
Technology (Shanghai)
Co., Ltd
Tafasitamab
CAR-NK2024/03/18Phase I3L+MonoDLBCLSimnova BiotechnologySNC103
CAR-T2023/12/15Phase I2L/3LMonoDLBCLPrecision BiotechMC-1-50
ADC2024/12/17Phase III1LCombo with
ChemotherapyDLBCLMSDZilovertamab VedotinROR1
2022/06/24Phase II3L+Mono
Small molecule2025/11/10Phase II2L+Monor/r NHLHangZhou HealZenHZ-H08905PI3K,CSNK1A1
mAb2022/02/18Phase I/IINACombo with BGB-
A317 or rituximabDLBCLBeiGeneOciperlimabTIGIT
CAR-T2023/09/08Phase I2L=MonoR/R LymphomaBiosyngenBRG 01CD47,PD-1
BsAb2023/06/05Phase III1LCombo with
ChemotherapyDLBCLGenmab, AbbVieEpcoritamabCD20,CD3
BsAb2024/03/25Phase I3L+MonoR/R B-Cell NHLSinoCelltech Ltd.SCTB35
mRNA Vaccine2024/10/17Phase I2L/3LMonoR/R EBV+ NHLWestGene BiopharmaWGc-043EBV antigens
Source: CDE, Clinical trial, Company Website, Literature Review, Frost & Sullivan Analysis
Note: The pipeline drugs listed in the table have enrolment criteria that include patients with EBV +NHL.
China Competitive Landscape of Second Line and Above EBV +NHL Monotherapy Pipelines
ModalityFirst Posted
Date Clinical StageTreatment
Line
Treatment
StrategyIndicationsCompanyDrug Name
/CodeTarget
Antiboby-based
fusion protein2022/01/22Phase II2L+MonoR/R LymphomaHanx BioHX009CD47,PD-1
CAR-T2022/07/08Phase III2L+MonoDLBCL, PMBCLJW TherapeuticsRelmacabtagene
Autoleucel
CD19 CAR-NK2024/03/18Phase I3L+MonoDLBCLSimnova BiotechnologySNC103
CAR-T2023/12/15Phase I2L/3LMonoDLBCLPrecision BiotechMC-1-50
ADC2022/06/24Phase II3L+MonoDLBCLMSDZilovertamab VedotinROR1
Small molecule2025/11/10Phase II2L+Monor/r NHLHangZhou HealZenHZ-H08905PI3K,CSNK1A1
CAR-T2023/09/08Phase I2L=MonoR/R LymphomaBiosyngenBRG 01CD47,PD-1
BsAb2024/03/25Phase I3L+MonoR/R B-Cell NHLSinoCelltech Ltd.SCTB35CD20,CD3
mRNA Vaccine2024/10/17Phase I2L/3LMonoR/R EBV+ NHLWestGene BiopharmaWGc-043EBV antigens
Source: CDE, Frost & Sullivan Analysis
Note: The pipeline drugs listed in the table have enrolment criteria that include patients with EBV +NHL.
China Competitive Landscape of Approved Targeted Drugs for EBV + NHL Treatment
As of the Latest Practicable Date, there was no approved bispecific antibodies in China
for EBV +NHL. As of the same date, among both monotherapy and combination therapy with
chemotherapy, there was one drug approved for EBV + NHL treatment.
Date of ApprovalPirce per
Treatment Cycle IndicationsTreatment LineDrug typeCompanyDrug NameTarget
2000/01/01RMB19,000EBV+ NHL2LMonoclonal antibodyRoche + BiogenRituximabCD20
Source: CDE, Frost & Sullivan Analysis
INDUSTRY OVERVIEW
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Treatment Paradigm of EBV + NHL
There is no specific treatment paradigm for EBV + NHL in the CSCO. For the NHL
patients, the common clinical treatments are chemotherapy combined with monoclonal
antibodies, including (i) CHOP (Cyclophosphamide, Doxorubicin, Vincristine and
Prednisolone); (ii) R (Rituximab) + CHOP; (iii ) R + CODOX-M (Cyclophosphamide,
Doxorubicin, Vincristine with Intrathecal Methotrexate and Cytarabine followed by high-dose
systemic Methotrexate); (iv ) R + EPOCH (Etoposide, Prednisone, Vincristine,
Cyclophosphamide, Doxorubicin); (v ) R + HyperCV AD (Cyclophosphamide, Vincristine,
Doxorubicin, Dexamethasone), and (vi) DDGP (Cisplatin, Dexamethasone, Gemcitabine and
Pegaspargase). HX009 is a bispecific antibody targeting both PD-1 and CD47. Compared to the
monoclonal antibody rituximab for the same disease stage, HX009 demonstrates synergistic
anti-tumour efficacy through dual mechanisms of CD8+ T cell activation and macrophage-
mediated immune response.
The abovementioned common clinical treatments for NHL patients are also the current
standard of care for EBV
+ NHL patients. EBV + NHL includes both B-cell type and T/NK cell
type, major types of which are EBV + DLBCL, Burkitt’s lymphoma and Extranodal NK/T cell
lymphoma. Common clinical treatments for EBV + NHL are similar in China and the U.S..
Treatment Paradigm of EBV + DLBCL in China
R-CHOP is the preferred first-line clinical treatment for EBV + B cell type (DLBCL). The
treatment regimen includes Rituximab, a monoclonal antibody; three chemotherapy drugs:
cyclophosphamide, doxorubicin, and vincristine; and a steroid called prednisone. The R-CHOP
therapy is an improved chemotherapy based on traditional CHOP therapy by introducing
Rituximab. R-CHOP shows both higher 10-year progression-free survival (PFS, 36.5%) and
overall survival (OS, 43.5%) compared to that of CHOP therapy (20% and 27.6%,
respectively). However, R-CHOP therapy is also limited by side effects, including febrile
neutropenia, infection, thrombocytopenia, and relapsed/refractory conditions.
EBV+ DLBCL
First-line Therapy
 RCHOP
 Pola-R-CHP
 Dose-adjusted EPOCH + rituximab
First-line Therapy for those with heart issues
 RCDOP
 RCEOP
 RGCVP
 RCEPP
 Dose-adjusted EPOCH + rituximab
First-line Therapy for those who are frail or are
over 80 years of age with other health issues
 RCDOP
 RGCVP
 RCEPP
 R-mini-CHOP
Second-line therapy options: HCT planned
 Dexamethasone and cytarabine (DHA) with carboplatin, cisplatin, or oxaliplatin
 GDP or gemcitabine, dexamethasone, and carboplatin
 ICE
 ESHAP
 Mine
 GemOx
* Rituximab might be added to any of the therapies listed above
Second-line therapy options: HCT not planned
 Lisocabtagene maraleucel (CD19-targeting CAR T-cell therapy)
 Polatuzumab vedotin-piiq ± bendamustine ± rituximab
 Tafasitamab-cxix and lenalidomide
 CEOP + rituximab
 Dose-adjusted EPOCH + rituximab
 GDP or gemcitabine, dexamethasone, and carboplatin + rituximab
 GemOx + rituximab
 Rituximab
 Brentuximab vedotin
 Ibrutinib
 Lenalidomide ± rituximab
Second
Line
First
Line
Disease
Progression
Source: Frost & Sullivan Analysis
INDUSTRY OVERVIEW
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Treatment Paradigm of Burkitt’s Lymphoma in China
For Burkitt’s lymphoma, preferred clinical therapies are CODOX-M with Rituximab,
EPOCH with Rituximab, and Hyper-CV AD. CODOX-M is a combination therapy used to treat
high-grade lymphomas. It is a highly effective regimen for the treatment of Burkitt’s
lymphoma, with a 74% 3-year PFS, a 77% 3-year OS, and low relapse rates. However, there
are side effects including neutropenia, thrombocytopenia, tumour lysis syndrome, sepsis, and
seizures. Another effective clinical treatment is EPOCH with Rituximab (EPOCH-R). It is used
to treat aggressive forms of NHL. Clinical studies reveal that within the adult population,
dose-adjusted EPOCH-R has an 84.5% 5-year event-free survival rate and an 87% OS. The
therapy is also tolerated by all age groups. Major side effects include neutropenia,
thrombocytopenia, and mucositis. Hyper-CV AD with Rituximab (Hyper-CV AD-R) is a
combination of chemotherapy, steroid drugs, and a monoclonal antibody. Clinical studies
showed that the 3-year OS, EFS, and disease-free survival rates were 89%, 80%, and 88%,
respectively, for Hyper-CV AD-R. The therapy is limited by the universal side effect of
myelosuppression and associated infections. Elderly patients also had worse treatment
outcomes compared to their younger counterparts because of the excessive burden of toxicity.
Burkitt’s lymphoma
Low Risk, Age <60 y
• CODOX-M
• Dose-adjusted EPOCH + rituximab
• Hyper-CV AD + rituximab
High Risk, Age <60 y
• Patients with CNS disease should be treated with
 systemic therapy that contains CNS-penetrating
 drugs
• CODOX-M
• Dose-adjusted EPOCH + rituximab
• Hyper-CV AD + rituximab
Low and High Risk, >60 y
• Dose-adjusted EPOCH + rituximab
• Intrathecal methotrexate
Second-line therapy options
• Dose-adjusted EPOCH (if not given in first line therapy)
• RICE + Intrathecal methotrexate (if not given in first line therapy)
• RIV AC + Intrathecal methotrexate (if not given in first line therapy)
• RGDP
• High dose cytarabine + rituximab
Second
Line
First
Line
Disease
Progression
Source: Frost & Sullivan Analysis
Treatment Paradigm of EBV + Extranodal NK/T-cell lymphoma in China
For EBV + Extranodal NK/T-cell lymphoma, the disease is sensitive to L-asparaginase,
and DDGP therapy is the preferred first-line method for this indication. Clinical studies showed
that the two-year PFS and OS rates were 81.4% and 87.1%, respectively. The overall response
rate (ORR) and complete response rate were 91.3% and 60%, respectively. Major adverse
effects were myelosuppression, digestive tract toxicities, and coagulation disorders.
P-GEMOX is a first line therapy for Extranodal NK/T-cell lymphoma treatment, the
overall response rate can be 88.8%, three-year progression free survival rate can be 57.8%.
INDUSTRY OVERVIEW
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SMILE is considered as a standard of care for second-line treatment of EBV + Extranodal
NK/T-cell lymphoma. The five-year overall survival can achieve 52.3%, and objective
response rate is 68.2%.
EBV+ Extranodal
NK/T-cell lymphoma
Stage I E, Low Risk
• Extended-field radiotherapy
Stage II E, Intermediate Risk, High Risk
• P-GEMOX
• COEP-L
• LOP
• SMILE
• ESA
• DDGP
• GELAD
• Extended-field radiotherapy
Second-line therapy options
• P-GEMOX
• SMILE
• DDGP
• COEP-L
• AspaMetDex
Second
Line
First
Line
Disease
Progression
Source: Frost & Sullivan Analysis
In the treatment paradigm of EBV + NHL, HX009 of our Company is a 2L+ treatment for
R/R EBV + NHL patients. As of the Latest Practicable Date, HX009 is the only PD-1/CD47
bispecific antibody fusion protein targeting R/R EBV + NHL globally.
Melanoma
Melanoma is the most serious type of skin cancer and it can also form in eyes and inside
the body, such as in the nose or throat. It develops in melanocytes — the cells that produce the
pigment melanin that colors the skin, hair and eyes. Signs and symptoms are often new spots
or moles on the skin which change in size, shape, and color. The spot can cause bleeding and
looks different from other lesions. Important signs include skin sore that does not heal and
moles that are red, swollen, itchy, tender, bleeding, or painful. Diagnosis of melanoma is based
on clinical manifestation, physical exam and biopsy. For melanoma targeted by our products,
the advanced stage refers to cases where the cancer has spread to distant parts of the body, such
as the lungs, liver, brain, and bones, or to distant lymph nodes. For advanced melanoma,
imaging tests including CT, MRI, PET-CT, ultrasound, and isotope bone scans are recommend
to look for signs of metastasis.
According to the F&S Report, China incidence of melanoma has increased from 8,200 in
2019 to 9,200 in 2024, representing a CAGR of 2.4%. It is estimated to be 10,300 in 2030 and
11,100 in 2035, representing a CAGR of 2.0% and 1.5%, respectively. Meanwhile, global
incidence of melanoma has increased from 294,600 in 2019 to 351,600 in 2024 with a CAGR
of 3.6%. It is estimated to be 376,600 in 2030 and 405,200 in 2035 with a CAGR of 1.2% and
1.5% respectively. For the first and second line melanoma that targeted by our HX009, the
number of patients in 2024 was approximately 4.9 thousand in China and 24.3 thousand
globally. In China, around 93% advanced melanoma patients receive 1L treatment and 58%
patients who progressed after first-line treatment receive 2L and above treatment.
INDUSTRY OVERVIEW
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Currently, no drug targeting CD47 has been approved for clinical use and our Core
Product HX009 is the only CD47 targeted bispecific antibody fusion protein for melanoma
under clinical study globally.
Market Size
According to the F&S Report, from 2019 to 2024, the global melanoma market has
increased from US$12.6 billion to US$18.4 billion, representing a CAGR of 7.9%.
Furthermore, the rapid increase in global melanoma market will continue in the near future.
The global melanoma market is forecasted to reach US$23.6 billion and US$27.3 billion by
2030 and 2035 respectively, which represents a CAGR of 4.2% from 2024 to 2030 and a CAGR
of 2.9% from 2030 to 2035. From 2019 to 2024, the total melanoma market in China has
increased from US$0.2 billion to US$0.3 billion, representing a CAGR of 6.2%. The total
melanoma market of China is forecasted to reach US$0.4 billion in 2035. The chart below
illustrates the historical and forecasted global melanoma market size in the periods indicated:
Global Historical and Forecasted Melanoma Market, 2019-2035E
Billion USD
2030E-2035E
2024-2030E
2019-2024
Period CAGR
1.9%
6.0%
6.2%
China
2.9%
4.2%
8.0%
RoW
2.9%
4.2%
7.9%
Total
China RoW
12.6
14.1 15.1 16.1
17.3 18.4 19.6 20.4 21.2 22.1 22.8 23.6 24.4 25.1 25.7 26.6 27.3
13.9 14.9 15.8 17.0 18.2 19.3 20.1 20.9 21.7 22.5 23.3 24.0 24.7 25.3 26.2 26.9
12.4
2019 2020 2021 2022 2023 2024 2025E 2026E 2027E 2028E 2029E 2030E 2031E 2032E 2033E 2034E 2035E
0.30.20.20.2 0.2 0.3 0.3 0.3 0.3 0.3 0.4 0.4 0.4 0.4 0.4 0.4 0.4
Source: Literature Review, Annual report, Expert interview, Frost & Sullivan Analysis
Beyond 2030, the melanoma market, along with the other three core indications, will
continue to expand in absolute terms, yet growth rates are expected to moderate due to
combined pricing and demographic pressures. While patent expiries, biosimilar competition,
and sustained pricing pressure from national reimbursement schemes systematically erode drug
prices, the incidence for these indications growth is also slowing down due to improved
prevention and earlier detection.
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China Competitive Landscape of First and Second Line and Above Melanoma Monotherapy
Pipelines (Phase II and Beyond)
There are over 150 pipelines drugs of targeted therapy for melanoma treatment in China.
There are over 50 monotherapy pipelines targeting first-line and second-line or above
melanoma treatment, with five in phase I/II, eight in phase II, and three in phase III.
ModalityFirst Posted Date Clinical StageTreatment LineIndicationsCompanyDrug Name
/CodeTarget
Antiboby-based fusion
protein2024/11/14Phase II1L/2L+Malignant MelanomaHanx BioHX009CD47,PD-1
mAb2015/10/23Phase III1LAdvanced MelanomaBristol Myers SquibbIpilimumabCTLA4
oncolytic virus2023/01/10Phase III3LMelanomaBinhui Biotechnology BS001CSF2R oncolytic virus2017/12/23Phase II2LMalignant MelanomaOrienGene BiotechnologyOrienX-010
Small molecule2023/06/30Phase III2LMelanoma
KeChow Pharma|Tianjin
Binjiang Pharmaceutical
Co., Ltd
TunlametinibMEK1,MEK2
ADC2021/11/11Phase II2L/3LHER2 Positive MelanomaRemegen Co.,Ltd.Disitamab vedotinHER2
Small molecule2021/11/16Phase II1L/2LAdvanced Melanoma (BRAF V600
Mutation)
Suzhou NeuPharma Co.,
Ltd.HLX-208BRAF V600E
BsAb2023/03/11Phase II1L/2LMelanomaQILU
PHARMACEUTICALQLF31907PD-L1,4-1BB
BsAb2023/03/21Phase II2L/3LAdvanced Melanoma and UC
QILU
PHARMACEUTICAL
CO.,LTD
QLF31907PD-L1,4-1BB
BsAb/
Antiboby-based fusion
protein
2023/10/07Phase II1LAdvanced MelanomaInnoventIBI363IL2RA,PD-1
Tumor-Infiltrating
Lymphocyte Therapy2024/12/16Phase II2L/3LAdvanced MelanomaJunsai Biotechnology GC101 TILNA
Small molecule2023/10/16Phase I/II2L/3LAdvanced Melanoma
BEIJING SCITECH-MQ
PHARMACEUTICALS
LIMITED
ST-1898c-
Met,RET,VEGFR
oncolytic virus2023/12/05Phase I/II1LAdvanced Melanoma
Shenzhen ImmVira
Pharmaceutical Technology
Co., Ltd
MVR-T3011IL12R,PD-1
ADC2024/01/12Phase I/II2L/3LMelanoma and Other Solid TumorMultitude Therapeutics
(Shanghai) Co., LtdAMT-253MCAM
Small molecule2025/04/10Phase I/II2L/3LAdvanced MelanomaCP Pharmaceutical Qingdao
Co., LtdBG136TLR4
mAb2025/07/08Phase I/II2L/3LAdvanced Solid Tumor (Including
Melanoma)GV20 TherapeuticsXBH25IGSF8
Antibody class fusion
protein2025/12/02Phase I/II2L/3LUnresectable or metastatic advanced
malignant melanoma
Shanghai Jinmante
BiotechnologyJMT108IL15R,PD-1
Source: CDE, Clinical trial, Company Website, Literature Review, Frost & Sullivan Analysis
Note: Table includes only Phase II+ first and second line and above monotherapies due to there are over 50 ongoing
first and second line and above monotherapies.
China Competitive Landscape of Approved Targeted Drug for Melanoma Treatment
As of the Latest Practicable Date, there was no approved bispecific antibodies in China
for melanoma.
Date of ApprovalTreatment StrategyIndicationsLine of TreatmentModalityCompanyDrug NameTarget
2025/04/22
MonoMelanoma
1L
mAb
Junshi
Shanghai/Suzhou
UNION
ToripalimabPD-1
2018/12/172L
2024/09/10
MonoMelanoma
1L
mAbMSDPembrolizumabPD-1
2018/07/202L
2024/03/12Mono
NRAS-mutated
advanced melanoma
patients who have
failed prior anti-PD-
1/PD-L1 therapy
2LSmall moleculeKezhou/BinjiangTunlametinibMEK2,
MEK1
2022/09/20MonoMelanoma2LmAbAkeso/HansohPucotenlimabPD-1
2019/12/18Combo with
Dabrafenib
BRAF V600
mutation-positive
unresectable or
metastatic melanoma
1L
Small moleculeJapan TobaccoTrametinibMEK1,
MEK2 2020/03/05Adjuvant
2019/12/18Combo with
Trametinib
BRAF V600
mutation-positive
unresectable or
metastatic melanoma
1L
Small moleculeGSKDabrafenibBRAF
2020/03/05Adjuvant
2017/03/10Mono
BRAF V600
mutation-positive
unresectable or
metastatic melanoma
1L/2LSmall moleculePlexxikon/Daiichi
SankyoVemurafenibBRAF
Source: CDE, Frost & Sullivan Analysis
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China Competitive Landscape of Approved First Line and Second Line Targeted
Monotherapy Drug for Melanoma Treatment
As of the Latest Practicable Date, there are five first and second line targeted
monotherapy drug approved for melanoma.
Target Drug Name Company Drug type Line of Treatment Indication Annual Treatment
Cost (RMB) Date of Approval
BRAF Vemurafenib Daiichi Sankyo Chemical Drug 1L
Unresectable or
with BRAF V600
mutation positivity
determined by a
detection method
approved by the
CFDA.
approximately
RMB100,000 1L: 2017/3/10
PD-1 Pembrolizumab MSD Monoclonal antibody 1L/2L Melanoma approximately
RMB50,000
2L: 2018-07-20
1L: 2024-09-10
PD-1 Toripalimab Junshi Biosciences Monoclonal antibody 1L/2L Melanoma approximately
RMB58,000
2L: 2018-12-17
1L: 2025-04-22
PD-1 Pucotenlimab Akeso Monoclonal antibody 2L Melanoma approximately
RMB20,000 2L: 2022-09-20
MEK1,
MEK2 Tunlametinib KeChow Pharma Chemical Drug 2L
Patients with
advanced
NRAS-mutant
melanoma  who have
failed anti-PD-1/
PD-L1 therapy
approximately
RMB240,000 2L: 2024-03-12
Source: CDE, Literature Review, Frost & Sullivan Analysis
Treatment Paradigm of Advanced Melanoma
Advanced melanoma populations receive similar treatments in the U.S. and China. In
China, preferred first-line therapies are Dabrafenib with trametinib, temozolomide, and
tunlametinib. Dabrafenib with trametinib is a combination therapy targeting BRAF V600
mutated Advanced Melanoma. Clinical studies showed that the ORR of this therapy was 61%,
and PFS was 7.9 months. The most common adverse effects were pyrexia and anemia.
Temozolomide is also a preferred first-line therapy in China. It was shown that the median
survival time for Temozolomide was 7.7 months and median PFS was 1.9 months. Overall,
Temozolomide therapy was well tolerated, and patients showed improvement or maintenance
of physical functioning as the clinical study progressed. Major side effects were moderate
nausea and vomiting. Combined therapy of endostatin and dacarbazine is another first line
treatment of advanced melanoma. The progression free survival was 4.5 months. Tunlametinib
is another approved therapy for treating advanced melanoma. Clinical studies showed that the
ORR of tunlametinib was 35.8%, median PFS was 4.2 months, and median OS was 13.7
months. PD-1 is considered as standard of care for second-line treatment of melanoma. Take
pembrolizumab as example, the progression-free survival measured at 12 months is 5.5
months, and the objective response rate is 33.7%, meaning that 66.3% patients do not have
complete response or partial response after pembrolizumab treatment.
In the treatment paradigm of melanoma, HX009 of our Company is a 1L/2L+ treatment
for melanoma patients, and it is the only PD-1/CD47 bispecific antibody fusion protein
targeting melanoma globally. Compared to the monoclonal antibody pembrolizumab for the
same disease stage, HX009 demonstrates synergistic anti-tumor efficacy through dual
mechanisms: CD8+ T cell activation and macrophage-mediated immune response.
Treatment Paradigm of Melanoma in the US
There are different types of treatment for patients with melanoma and five of them are
standard treatments including surgery, chemotherapy, radiation therapy, immunotherapy,
targeted therapy. New vaccine treatment is being tested for clinical uses to treat melanoma. The
prognosis and treatment options depend on various factors, including the thickness, the
location of the tumor and the speed of cell dividing.
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Melanoma
Metastatic or Unresectable Disease
First Line
 Combination checkpoint blockaded
(preferred)
o Nivolumab/ipilimumab
o Nivolumab and relatlimab-rmbw
 Anti PD-1 monotherapy
o Pembrolizumab
o Nivolumab
 Combination therapy if BRAF V600
mutation-positive
o Dabrafenib/trametinib
o Vemurafenib/cobimetinib
o Encorafenib/binimetinib
 Pembrolizumab/low-dose ipilimumab
 Anti PD-1 monotherapy
o Pembrolizumab
o Nivolumab
 Nivolumab/ipilimumab
 Nivolumab and relatlimab-rmbw
 Pembrolizumab/low-dose ipilimumab for
progression following anti-PD-1 therapy
 Combination therapy if BRAF V600
mutation-positive
o Dabrafenib/trametinib
o Vemurafenib/cobimetinib
o Encorafenib/binimetinib
 Ipilimumab
 High-dose IL-2
Disease
Progression
Second Line
Source: NCCN Guideline 2024, Frost & Sullivan analysis
Treatment Paradigm of Melanoma in China
The reduction of tumor burden, improvement of tumor-related symptoms, quality of life,
and prolonging survival can be achieved by systemic therapy for patients with advanced
melanoma. Common therapies include targeted therapy, chemotherapy, immunotherapy,
response evaluation criteria of systemic therapy and symptomatic supportive therapy.
• PD-1 mAb
• PD-1 + Ipilimumab
• PD-1 mAb + LAG3 mAb
If with BRAF V600 mutation:
• Dabrafenib + trametinib
• Dacarbazine/Temozolomide ± Platinumor
± Endostar
• Vemurafenib
If with KIT mutation: Imatinib
• PD-1 mAb
• PD-1 mAb + Ipilimumab
• P D - 1m A b  +L A G 3m A b
If with BRAF V600 mutation:
• Dabrafenib + trametinib
• Temozolomide
• Vemurafenib
If with KIT mutation: Imatinib
If with NRAS mutation: Trametinib
First Line
Second Line
Melanoma
Metastatic or unresectable stage III or IV
Resectable
Mucosal Cutaneous & Acral Uveal
No Cerebral metastases Cerebral metastases
• Chemotherapy +
anti-angiogenic drugs
If with BRAF V600 mutation:
• Vemurafenib
• Dabrafenib + trametinib
If with the NRAS mutation:
• Tunlametinib (HL085)
If with c-KIT mutation:
•I m a t i n i b± local
radiotherapy
• Clinical research
• Chemotherapy +
anti-angiogenic drugs
If with liver metastasis:
• Ipilimumab
• MEK inhibitor
• PD-1 mAb
Disease
Progression
• Lenvatinib + Pembrolizumab
• Fotemustine
• Ipilimumab + T-VEC (Talimogene laherparepvec)
If PD-1 mAb has not been used in the first line therapy: PD-1 mAb
If with the NRAS mutation: Tunlametinib (HL085)
If cytoreduction is needed, combination of targeted therapy and
chemotherapy is recommended:
• Paclitaxel/Albumin Paclitaxel ± Platinum ± Antivascular drugs
• Toripalimab + Axitinib
• PD-1 mAb
• Atezolizumab +
Bevacizumab
• PD-1 mAb + LAG3 mAb
• Clinical research
• Large dose interferon
alfa-2b
Source: CSCO Melanoma Diagnosis and Treatment Guidelines 2024, Frost & Sullivan analysis
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Unmet Clinical Needs
 High malignancy and highly metastatic: Melanoma is the malignancy with the high rate
of dissemination to the brain. 50% to 80% of patients with advanced melanoma will
develop liver metastases, and 8% to 46% of patients with melanoma will develop brain
metastases.
 Limitations of chemotherapy and surgery: (i) chemotherapy: traditional cytotoxic drugs
including dacarbazine, temozolomide, fluoxetine, paclitaxel, albumin paclitaxel, cisplatin
and carboplatin, are not effective in advanced melanomas with an overall response rate
of 10% to 15%; and (ii) surgery: acral lentiginous melanoma is more common among
Chinese patients than Caucasians. When considering complete tumor removal, the
functions of limbs should be fully considered as much as possible, especially finger
function.
 Lack of medical evidence among Chinese patients: Most of the current progression of
immune checkpoint inhibitors for malignant melanoma is based on data from Caucasians
in Western countries, but the benefit to Chinese patients is limited, mainly due to different
pathological subtypes. The patients in western countries are mainly skin type melanoma
(about 90%), while the acral and mucosa types are dominant among Chinese patients,
accounting for 41.8% and 22.6% respectively. Compared to cutaneous malignant
melanoma, acral and mucosal melanomas are generally considered more aggressive
malignancies, exhibiting low response rates to immunotherapy and chemotherapy. In a
retrospective analysis of 52 patients between August 2012 and March 2016, the objective
response rate of ipilimumab, pembrolizumab and pembrolizumab plus ipilimumab were
0%, 25% and 20%, respectively. In the KEYNOTE-151 study, which was a phase Ib study
of second-line pembrolizumab for Chinese patients with advanced or metastatic
melanoma, the objective response rates in mucosal and acral melanoma of Chinese
advanced melanoma patients were 13.3% and 15.8% respectively under the treatment of
pembrolizumab, median progression-free survival 2.8 months, and median overall
survival 12.1 months. In China, new treatment strategies need to be explored for patients
who are resistant to PD-1 inhibitors.
Glioblastoma
Glioblastoma, also known as glioblastoma multiforme (GBM), is one of the common
brain tumors resided in the central nervous system. Glioblastoma is the most malignant
astrocytic tumor, accounting for 52% of primary brain tumors. Most glioblastomas are primary
tumors, and their pathogenesis is different from secondary tumors. The molecular changes of
primary glioblastoma are mainly amplification and overexpression of epidermal growth factor
receptor, while the mutation of p53 (a major tumor suppressor cell factor) is the main cause of
secondary glioblastoma.
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According to the F&S Report, the incidence of glioblastoma in China has reached 45,000
in 2024 from 37,800 in 2019 with a CAGR of 3.5%. The incidence is projected to grow to
51,400 in 2030 with a CAGR of 2.3% and 56,800 by 2035, representing a CAGR of 2.0%. For
the first-line glioblastoma targeted by our HX301 was approximately 36.5 thousand in 2024 in
China. Around 81.0% glioblastoma patients receive first-line treatment.
Market Size
According to the F&S Report, the market of glioblastoma in China reached RMB1.2
billion in 2024, primarily due to the inclusion of temozolomide in the volume-based
procurement program in 2022, which led to a contraction in market size. The market enlarge
to RMB3.2 billion and RMB5.4 billion by 2030 and 2035 with the CAGR of 17.9% and 10.7%
respectively. The chart below illustrates the historical and forecasted glioblastoma market size
in China in the periods indicated:
Historical and Forecasted Glioblastoma Market in China, 2019-2035E
2019 2020 2021 2022 2023 2024 2025E 2026E 2027E 2028E 2029E 2030E 2031E 2033E 2032E 2034E 2035E
1.9 2.0
1.3
0.9 0.8
1.2
1.5
1.9
2.2
2.5
2.9 3.2
3.6
4.0
4.5
4.9
5.4
Billion RMB
Period
2019-2024
2024-2030E
2030E-2035E
CAGR
-8.6%
17.9%
10.7%
Source: Literature Review, Annual report, Expert interview, Frost & Sullivan Analysis
Note: The inclusion of temozolomide in the volume-based procurement program in 2022 led to a contraction in
market size then.
China Competitive Landscape of First Line Glioblastoma Combination Therapy Pipelines
There are over 45 pipelines drugs of targeted therapy for glioblastoma treatment in China.
Currently, there are three small molecule inhibitor for first line combination treatment of
glioblastoma in clinical stage in China.
ModalityFirst Posted
Date Clinical StageLine of treatmentIndicationsCompanyDrug
Name/CodeTarget
Small molecule2024/11/21Phase II1LGlioblastomaHanx BioHX301CSF1R/ARK5/CD
K4/6/FLT-3
Small molecule2022/08/12Phase III1LGlioblastomaJenKemPegylated
irinotecanTOP1
Small molecule2021/01/13Phase III1LGlioblastomaXcelienceEnzastaurinPRKCB
Source: CDE, Frost & Sullivan Analysis
Note: Table includes only therapies for the same indication and line of treatment
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China Competitive Landscape of Approved Targeted Drug for Glioblastoma Treatment
Date of ApprovalTreatment StrategyIndicationsLine of TreatmentModalityCompanyDrug NameTarget
2024/04/17MonoGlioblastoma2LSmall moleculeCrownBioBozitinibc-Met
2020/09/14MonoGlioblastoma2LmAbRocheBevacizumabVEGFA
Source: CDE, Frost & Sullivan Analysis
Treatment Paradigm of Glioblastoma
U.S. and China have similar treatment paradigms, both using temozolomide combined
with radiotherapy as the preferred clinical treatment. Temozolomide is a small molecule drug
that can cross the blood-brain barrier to affect the central nervous system. Clinical results
showed that compared to radiotherapy alone, introducing temozolomide improves treatment
efficiency. The median survival of radiotherapy with temozolomide was 14.6 months and the
two-year survival rate was 26.5%, while that of radiotherapy alone was 12.1 months and
10.4%. Adverse effects include neutropenia and thrombocytopenia. The standard-of-care drugs
for first line glioblastoma in China are chemotherapies combined with monoclonal antibodies,
including temozolomide and bevacizumab.
In the treatment paradigm of glioblastoma, HX301 of our Company is a 1L treatment for
glioblastoma patients. HX301 is a small molecule kinase inhibitor, while temozolomide is a
traditional cytotoxic drug that functions by damaging cellular DNA. Small molecule inhibitors
of protein kinases show fewer side effects than traditional cytotoxic therapies. Compared to
bevacizumab, HX301 can effectively penetrate the blood-brain barrier, while it is difficult for
bevacizumab, a monoclonal antibody, to penetrate and reach cancer cells.
Treatment Paradigm of Glioblastoma in the U.S.
In the U.S., current treatment options for recurrent glioblastoma include surgery,
chemoradiotherapy combined with temozolomide and the use of tumor treating fields. These
treatments are used as the first line therapy and are accepted as standard of care for treating
glioblastoma in the U.S..
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MGMT promoter region
methylation +KPS ≥ 60
MGMT promoter region
methylation +KPS ≥ 60
Glioblastoma
Radiotherapy + TMZ + TTF
Radiotherapy + TMZ
TMZ
Hypofractionated radiotherapy
> 70 years old
Unmethylated or intermediate
methylation + KPS ≥ 60
Hyperfractionated radiotherapy +
TMZ
Radiotherapy + TMZ + TTF
Clinical Trial
Radiotherapy + TMZ
Hypofractionated radiotherapy
Surgery
≤ 70 years old
Unmethylated or intermediate
methylation + KPS ≥ 60
Radiotherapy + TMZ
Radiotherapy + lomustine + TMZ
Radiotherapy + TMZ + TTF Radiotherapy + TMZ + TTF
Radiotherapy + TMZ
Radiotherapy
Clinical Trial
Hypofractionated radiotherapy + TMZ
KPS < 60
KPS < 60
Hypofractionated
radiotherapy ± concurrent
or adjuvant TMZ
TMZ
Palliative care
Hypofractionated
radiotherapy
TMZ
Palliative care
Note: KPS= Karnofsky score, TTF=Tumor Treating Fields, TMZ=Temozolomide
Source: NCCN, Frost & Sullivan Analysis
Treatment Paradigm of Glioblastoma in China
Glioblastoma is the most common primary brain cancer, and the recurrence of
glioblastoma has become an important clinical issue because most patients relapse at the
primary site. In China, current treatment options for recurrent glioblastoma include surgery,
chemoradiotherapy combined with temozolomide and the use of bevacizumab.
MGMT promoter region
methylation +KPS ≥ 60
MGMT promoter region
methylation +KPS ≥ 60
Glioblastoma
Concurrent chemoradiotherapy + TMZ
TMZ
Hypofractionated radiotherapy
> 70 years old
Unmethylated or intermediate
methylation + KPS ≥ 60
Concurrent chemoradiotherapy +
TMZ + TTF
Concurrent chemoradiotherapy + TMZ
Hypofractionated radiotherapy
Surgery
≤ 70 years old
Unmethylated or intermediate
methylation + KPS ≥ 60
Concurrent chemoradiotherapy + TMZ
Concurrent chemoradiotherapy +
TMZ + TTF
Concurrent chemoradiotherapy +
TMZ + TTF
Concurrent chemoradiotherapy + TMZ
Radiotherapy
Hyperfractionated concurrent
radiotherapy and chemotherapy +
TMZ + TTF
Hyperfractionated concurrent
radiotherapy and chemotherapy +
TMZ + TTF
Concurrent chemoradiotherapy +
TMZ + TTF
KPS < 60
KPS < 60
Hypofractionated
radiotherapy ± concurrent
or adjuvant TMZ
TMZ
Palliative care
Hypofractionated
radiotherapy
TMZ
Palliative care
KPS = Karnofsky score, TTF = Tumor Treating Fields, TMZ = Temozolomide
Source: CSCO, Frost & Sullivan Analysis
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Unmet Clinical Needs
 High difficulty and poor prognosis of glioblastoma surgery : Surgery is the cornerstone
of glioblastoma treatment, and maximum safe resection is the principle of glioblastoma
surgery. However, glioblastoma surgery can be challenging due to the infiltrative nature
of these tumors, which can spread into surrounding healthy brain tissue. As a result,
achieving complete tumor removal without causing damage to critical areas of the brain
can be extremely difficult. Furthermore, even with advances in neurosurgical techniques,
it is often not possible to safely remove all cancerous cells, leading to the potential for
tumor recurrence. Additionally, the location of glioblastoma within the brain, especially
in areas that control vital functions such as movement, speech, and vision, can further
complicate the surgical approach. The invasiveness of glioblastoma surgery also presents
inherent risks, including the possibility of neurological deficits, post-operative
complications, and an extended recovery period for patients.
 Blood-brain barrier posing a challenge for drug delivery : The blood-brain barrier is a
physical and physiological barrier that is highly selective and regulates the passage of
molecules from the circulatory system into the brain parenchyma. The blood-brain barrier
restricts the entry of many chemotherapy drugs and other medications into the brain at
effective concentrations, limiting their ability to target and treat glioblastoma. This means
that even if a drug is effective against glioblastoma cells in laboratory studies, it may not
reach these cells at a high enough concentration to be effective when administered
systemically. The blood-brain barrier hinders the treatment of glioblastoma, so it is
particularly important to select suitable nanoparticles that can penetrate the blood-brain
barrier and precisely target tumor cells.
 Chemotherapy resistance reduces treatment efficacy : According to current evidence-
based medical evidence, temozolomide-based chemotherapy has played a major role in
the treatment of glioblastoma, but the clinical effect is still poor. The five-year survival
rate for glioblastoma patients is only 6.9%, and the average length of survival for
glioblastoma patients is estimated to be only eight months. Resistance to chemotherapy
can occur through various mechanisms, including heterogeneity, hypermutation, immune
evasion, and alternative splicing in tumor activation. Addressing the challenge of
resistance to therapy is crucial for improving the overall outcomes for patients with
glioblastoma and for advancing the field of glioblastoma treatment towards more
effective and personalized therapeutic interventions.
 Lack of treatments targeted macrophage : The glioblastoma micro-environment plays a
critical role during tumor development and treatment course. Unlike most other solid
tumors, the glioblastoma micro-environment is dominated by macrophages and microglia
(collectively known as tumor-associated macrophages), which provide various potential
points of intervention for therapeutic approaches in glioblastoma patients. However, there
are no drug targeted macrophage on the market currently and giant potential is left to be
discovered.
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Biliary Tract Cancer
BTC is the second most common type of liver and bile duct cancer worldwide, typically
comprised of cholangiocarcinomas and gallbladder cancers, patients with ampullary cancer are
also included in some cases. BTC’s most common symptom is jaundice, characterized by a
deep yellow color in the eyes and skin due to bile duct obstruction. BTC is a common
malignant tumor of the biliary system. Early symptoms include abdominal discomfort,
decreased appetite, weight loss, etc. Advanced BTC targeted by our products is metastatic or
unresectable tumors that are not amenable to local therapy with curative intent. In later stages,
symptoms may include jaundice, abdominal pain, fever, etc. The concealed nature of the
gallbladder often leads to late-stage detection, resulting in a poor prognosis.
According to the F&S Report, the incidence of BTC in China reached 139,800 in 2024.
This number is expected to increase to 161,100 in 2030 and 179,100 in 2035, representing a
CAGR of 2.4% between 2024 and 2030 and 2.1% between 2030 and 2035, respectively.
Meanwhile, global incidence of BTC in 2024 reached 419,100. It is estimated to rise to 505,000
in 2030 and 582,900 in 2035, representing a CAGR of 3.2% and 2.9%, respectively. For the
second line BTC targeted by our HX009, the number of patients in 2024 was approximately
84.9 thousand in China and 254.6 thousand globally. Around 89% advanced BTC patients
receive 1L treatment and approximately 63% to 74% of patients who progressed after first-line
treatment receive 2L and above treatment.
Market Size
From 2019 to 2024, China’s BTC drug market size increased from RMB1.5 billion in
2019 to RMB3.4 billion in 2024, with a CAGR of 17.7% from 2019 to 2024. The market size
will climb to RMB9.9 billion and RMB17.2 billion in 2030 and 2035 respectively.
Historical and Forecasted of China BTC Drug Market Size, 2019-2035E
2019 2020 2021 2022 2023 2024 2025E 2026E 2027E 2028E 2029E 2030E 2031E 2033E 2032E 2034E 2035E
Billion RMB
Period
2019-2024
2024-2030E
2030E-2035E
CAGR
17.7%
19.4%
11.6%
1.5 1.6 1.8 2.0 2.6 3.4 4.3 5.2
6.2
7.3
8.5
9.9
11.4
12.9
14.5
15.9
17.2
Source: Frost & Sullivan Analysis
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China Competitive Landscape of Second Line and Above BTC Combination therapy
Pipelines
As of the Latest Practicable Date, there are over 170 pipelines drugs of targeted therapy
for BTC treatment in China, there were over 100 pipeline drugs for the treatment of
monotherapy BTC in clinical trial, and there were over 85 pipeline drugs for the treatment of
second-line and above BTC in clinical trials. Among them, 16 are combination pipelines (the
same kind of therapy as our HX009). Specifically, four are in phase I, 11 are in phase I/II, and
two are in phase II.
ModalityFirst Posted
Date Clinical StageCombinationTreatment LineIndicationsCompanyDrug Name
/CodeTarget
Antiboby-based
fusion protein2024/11/14Phase IICombination therapy with
IN100182L+BTCHanx BioHX-009CD47,PD-1
bsADC2025/05/12Phase IICombination therapy with
PD1/PDL1 inhibitor2L+BTCBaili-BioIzalontamab
brengitecanEGFR,HER3
Small molecule2019/05/30Phase I/IICombination therapy with
gemcitabine1L/2LSolid tumor
(Including BTC)SciClone PharmaceuticalsImifoplatin-
Small molecule2021/11/08Phase I/IICombination with
chemotherapy2L+Solid tumor
(Including BTC)
Ankang Biological
TechnologyTinengotinib
AURKA,AURKB,
CSF1R,JAK1,JAK2,
VEGFR,FGFR
Small molecule2022/07/01Phase I/IICombination therapy with
toripalimab1L/2L+Solid tumor
(Including BTC)GenFleet TherapeuticsGFH018TGFBR1
ADC2022/10/19Phase I/IICombination therapy with
rilvegostomig2L+BTC, OC, TNBCAstraZenecaPuxitatug samrotecanB7-H4
mAb2022/12/05Phase I/IICombination therapy with
gemcitabine and cisplatin1L/2L+BTCSUNHO (China)
BioPharmaceuticalIAH 0968HER2
ADC2023/05/10Phase I/IICombination therapy with
toripalimab1L/2L+Solid tumor
(Including BTC)RemegenRC118CLDN-18.2
ADC2023/06/09Phase I/IICombination therapy with
trastuzumab1L/2L+Solid tumor
(Including BTC)Duality BiologicsDB-1310HER3
ADC2023/09/11Phase I/IICombination therapy with
toripalimab1L/2L+Solid tumor
(Including BTC)RemegenRC108c-Met
BsAb/
fusion protein
2024/05/20Phase I/IICombination therapy with
LB14101L/2L+Solid tumor
(Including BTC)L&L BiopharmaLB4330IL10R,
CLDN-18.2
fusion protein2025/04/08Phase I/IICombination therapy with
Ivonescimab2L+BTCAkesoAK130TIGIT,TGFB
BsAb2025/09/09Phase I/IICombination therapy with
IMM012L+Solid tumor
(Including BTC)
ImmuneOnco
Biopharmaceuticals
(Shanghai)
IMM2510
(Palverafusp alfa)PD-L1,VEGF
Small molecule2021/06/25Phase ICombination therapy with
atezolizumab1L/2L+Solid tumor
(Including BTC)KeytheraKF-0210PTGER4
ADC2022/09/09Phase ICombination therapy with
docetaxel2L+Solid tumor
(Including BTC)Zhejiang XinmaAnvatabart opadotinHER2
Small molecule2024/03/05Phase ICombination with other
antitumor agents1L/2L+Solid tumor
(Including BTC)Chengdu CyanogenCG-7321-
ndMG2024/07/26Phase ICombination therapy with
docetaxel1L/2L+BTC, GC, PCPatheon pharma
AmgenAMG 193PRMT5
Antiboby-based
Antiboby-based
Source: CDE, Frost & Sullivan Analysis
Note: Table includes only therapies for the same indication and line of treatment
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China Competitive Landscape of Approved Targeted Drug for BTC Treatment
As of the Latest Practicable Date, there was one approved bispecific antibodies in China
for BTC. The approved drug is Ziihera ® (zanidatamab for injection), a HER2-targeting
bispecific antibody developed by BeiGene. It was approved in China on 27 May 2025 for the
treatment of unresectable locally advanced or metastatic biliary tract cancer that is HER2-
high-expressing (IHC 3+) after prior systemic therapy, making it the first and currently only
bispecific antibody approved for this indication in China.
Rider 9
Date of ApprovalCombination
TherapyIndicationsLine of
TreatmentModalityCompanyDrug NameTarget
2023/11/07
Combo with
Gemcitabine and
Cisplatin
BTC1LmAbAstraZenecaDurvalumabPD-L1
2024/01/30
Combo with
Gemcitabine and
Cisplatin
BTC1LmAbMSDPembrolizumabPD-1
2025/05/27Mono
Patients with unresectable
locally advanced or metastatic
biliary-tract cancer whose
tumors show high HER2
expression (IHC 3+) and who
have received prior systemic
therapy.
2LbsAbZymeworksZanidatamabHER2
2022/03/29Mono
Adult patients with advanced,
metastatic, or unresectable
cholangiocarcinoma who have
received at least one prior
systemic therapy and whose
tumors test positive for FGFR2
fusion or rearrangement.
2LSmall
moleculeIncytePemigatinib
FGFR1,
FGFR2,
FGFR3
Source: CDE, Frost & Sullivan Analysis
China Competitive Landscape of Second Line and Above BTC Combination therapy
As of the Latest Practicable Date, there are two targeted drug approved for BTC which
are combination therapy.
Target Drug Name Company Drug type Line of
Treatment Indications Combination
Therapy
Annual
Treatment Cost
(RMB)
Date of
Approval
PD-L1 Durvalumab AstraZeneca Monoclonal
antibody 1L Biliary tract
cancer
Combination of
Gemcitabine and
Cisplatin
~430,000 2023/11/07
PD-1 Pembrolizumab MSD Monoclonal
antibody 1L Biliary tract
cancer
Combination of
Gemcitabine and
Cisplatin
~200,000 2024/01/30
Source: CDE, Literature Review, Frost & Sullivan Analysis
Treatment Paradigm of BTC
U.S. and China have similar treatment paradigms, and preferred first-line therapies in
China for BTC are combined therapies comprising chemotherapy and targeted monoclonal
antibodies. For patients tolerant to intense chemotherapy, preferred combinations are:
Gemcitabine with Cisplatin and Durvalumab; Gemcitabine with Cisplatin and Pembrolizumab;
Gemcitabine with Cisplatin alone; Gemcitabine with Tegafur; and Capecitabine with
Oxaliplatin. A previous study showed that the combination of Gemcitabine with Cisplatin
INDUSTRY OVERVIEW
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increased advanced BTC patient OS from 8.1 to 11.7 months. The combination of Gemcitabine
with Tegafur had an OS of around 15.1 months. The OS was 10.6 months for the treatment with
Capecitabine and Oxaliplatin. Combining Gemcitabine with Cisplatin and Durvalumab
increased patient OS to 12.8 months and PFS to 7.2 months. When Gemcitabine and Cisplatin
are combined with Pembrolizumab, the median treatment OS was 12.7 months. For intolerant
patients, only Gemcitabine should be used. Adverse effects of combined therapies include, but
are not limited to, neutropenia, anaemia, worse of liver function and thrombocytopenia.
For advanced BTC patients without specific gene mutations, PD-1 inhibitors are standard
second-line therapy. Take pembrolizumab as an example, The PFS measured at 26 months is 6.5
months, and objective response rate is 28.7%, meaning that 71.3% patients do not have complete
response or partial response after pembrolizumab treatment. In the treatment paradigm of BTC,
HX009 of our Company is a 2L+ treatment for BTC patients, and it is the only PD-1/CD47
bispecific antibody fusion protein targeting BTC globally. Compared to the monoclonal antibody
pembrolizumab targeting the same stage of disease, HX009 has synergistic anti-tumor efficacy
via CD8+ T cell activation and macrophage-mediated immune response.
Treatment Paradigm of BTC in the U.S.
BTC treatment paradigm in the U.S. can be classified according to resectable and
unresectable conditions. Surgery is a primary treatment method to remove all of the cancer for
resectable BTC. Systemic therapy is applied when BTC disease is unresectable, this involves
chemotherapy, targeted therapy and immunotherapy. This is the current standard of care in the
U.S.. The primary treatments are accepted as standard of care in the U.S..
BTC Treatment
Gallbladder cancer
Primary
treatment
Subsequent
-Line
Therapy
ICC
Disease
Progression
• Cholecystectomy
• En bloc hepatic
resection
• Lymphadenectomy
• Bile duct excision
• Durvalumab + G + CP
• Pembrolizumab + G +
CP
If Disease Progression
Unresectable Resection
ECC
Unresectable Resection ResectionUnresectable
• Capecitabine
• Gemcitabine + capecitabine
• 5-FU
• G
• Chemoradiation
• Staging laparoscopy
• Resection and
regional
lymphadenectomy
• ablation
• Staging laparoscopy
• Preoperative biliary
drainage
• Capecitabine
• G + capecitabine
• G + CP
• 5-FU
• G
• Chemotherapy + Chemoradiation
• Radiation therapy
Note: G = gemcitabine; CP = cisplatin; S-1 = tegafur/ gimeracil /oteracil ; nab -pax = nanoparticle albumin -bound paclitaxel, OP = oxaliplatin, X = ca pecitabine; GEMOX = gemcitabine
+ oxaliplatin; 5-FU = 5-Fluorouracil; mFOLFOX = oxaliplatin + 5-FU; FOLFIRI = folinic acid, fluorouracil and irinotecan; Nal-IRI = Irinotecan; MSI -H/dMMR = Microsatellite instability
high/deficient mismatch repair, IDH1 = isocitrate dehydrogenase 1; FGFR2 = fibroblast growth factor receptor 2; BRAF V600E = V600E mutation of v-raf murine sarcoma viral
oncogene homolog B1.
• FOLFOX
• FOLFIRI
• Liposomal irinotecan
• Fluorouracil
• Leucovorin
• regorafenib
• FOLFOX
• FOLFIRI
• Liposomal irinotecan
• Fluorouracil
• Leucovorin
• regorafenib
• Capecitabine
• G + capecitabine
• 5-FU
• G
• Chemoradiation
• FOLFOX
• FOLFIRI
• Liposomal irinotecan
• Fluorouracil
• Leucovorin
• regorafenib
• Capecitabine
• G + capecitabine
• 5-FU
• G
• Chemoradiation
• Capecitabine
• G + capecitabine
• 5-fluorouracil
• G
• Chemotherapy +
Chemoradiation
• Chemoradiation
Source: NCCN, Frost & Sullivan Analysis
Treatment Paradigm of BTC in China
BTC exhibits heterogeneity in clinical and pathological aspects, with poor response to
chemotherapy and prognosis. Patients with BTC who undergo surgical resection have a very
high recurrence rate. For advanced unresectable or metastatic patients, systemic therapy is the
only treatment option available. For advanced or metastatic BTC patients, the representative
first-line treatment regimen is gemcitabine combined with cisplatin.
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BTC Late Stage
Tolerant to Intense Chemotherapy
Grade I Recommendation
First
Line
Second
Line
Grade II Recommendation
• G + CP + nab-pax
• G + CP + S-1
• GEMOX
• 5-FU + OP/CP
•X +  C P
•G +  X
• G or 5-FU based
• G + nab-pax
• Camrelizumab + GEMOX
• Entrectinib
• Larotrectinib
• Pembrolizumab
Grade III Recommendation
• G + CP + Nivolumab
• GEMOX + Lenvatinib + Toripalimab
•F O L F I R
• Clinical Trials (FGFR2, IDH1/2, etc)
•G +  C P
• G + CP +
Durvalumab
• G + CP +
Pembrolizumab
• G + S-1
•X + O P
Intolerant to Intense
Chemotherapy
Grade I/II Recommendation
•G
• S-1/5-FU/X single agent
•m F O L F O X
• IDH1: Ivosidenib
• Clinical Trials
• Nal-IRI + S-1
•F O L F I R
• Regorafenib
• FGFR2: Pemigatinib
• HER2+: Trastuzumab
Deruxtecan/Pertuzumab +
Trastuzumab
• MSI-H/dMMR: Pembrolizumab
• BRAF V600E: Dabrafenib + Trametinib
• RET: Pralsetinib/Selpercatinib
•N i v o l u m a b
•F O L F I R
• Lenvatinib + Pembrolizumab
• Anlotinib + PD-1/PD-L1
• surufatinib
If performance status ≤ 1
Disease
Progression If performance
status ͹2
• MSI-H/dMMR:
Pembrolizumab
• IDH1: Ivosidenib
• Supportive Care
Grade I Recommendation Grade II Recommendation Grade III Recommendation Grade I/II Recommendation
Note: G = gemcitabine; CP = cisplatin; S-1 = tegafur/gimeracil/oteracil; nab-pax = nanoparticle albumin-bound paclitaxel, OP = oxaliplatin, X = capecitabine; GEMOX = gemcitabine +
oxaliplatin; 5-FU = 5-Fluorouracil; mFOLFOX = oxaliplatin + 5-FU; FOLFIRI = folinic acid, fluorouracil and irinotecan; Nal-IRI = Irinotecan; MSI-H/dMMR = Microsatellite instability
high/deficient mismatch repair, IDH1 = isocitrate dehydrogenase 1; FGFR2 = fibroblast growth factor receptor 2; BRAF V600E = V600E mutation of v-raf murine sarcoma viral oncogene
homolog B1.
Source: CSCO, Frost & Sullivan Analysis
Unmet Clinical Needs
 Limitations of current therapies : Surgical intervention is a critical approach in curing
BTC. However, over 65% of patients are diagnosed too late for curative surgical
resection, resulting in a five-year survival rate of approximately 5% to 15%. Even among
those who undergo surgical treatment, the recurrence rate within one year remains as high
as 67%. For advanced BTC patients who are ineligible for surgery, treatment primarily
revolves around medication and localized therapy, yet outcomes are limited, leading to
poor prognosis. There is an urgent need to explore more effective comprehensive
treatment strategies.
 High mutation frequency : BTC exhibits high heterogeneity at the genomic, epigenetic,
and molecular levels, requiring further research to understand its different subtypes’
molecular characteristics and therapeutic targets. The frequency of somatic mutations
such as TP53, CDKN2A/B, KRAS, and SMAD4 is relatively high in BTC patients, yet
effective targeted treatment methods are currently lacking. The increase expression of
CD47 protects cancer from immune surveillance. Interfering of CD47-SIRP /H9251interaction
has demonstrated potential uses in the treatment of BTC. Additionally, the low mutation
frequency of targeted therapy drugs limits the potential beneficiaries, necessitating
further clinical research to explore combination therapy approaches.
 Limited treatment options : Currently approved targeted drugs are relatively scarce, and
mostly reserved for first-line combination therapy. The low mutation frequency of
targeted therapy limits the potential beneficiaries. There is insufficient evidence for the
combination therapy of precision-targeted treatments, highlighting the urgent need for
more clinical research.
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Triple-Negative Breast Cancer
Triple-negative breast cancer (TNBC) is a type of breast cancer defined by
immunohistochemistry as being negative for estrogen receptor, progesterone receptor, and
human epidermal growth factor receptor 2 (HER2). It accounts for approximately 15% of all
breast cancer cases globally. TNBC is typically diagnosed more frequently in younger and
premenopausal women. Advanced TNBC targeted by our products refers to cancer that has
spread to areas away from the breast, such as the bones, liver, lungs, or brain.
According to the F&S Report, the incidence of TNBC in China reached 55,900 in 2024.
This number is expected to increase to 59,600 in 2030 and 61,200 in 2030, representing a
CAGR of 1.1% between 2024 and 2030 and 0.5% between 2030 and 2035. Global incidence
of TNBC in 2024 reached 364,900. It is estimated to rise to 394,300 in 2030 and 422,800 in
2035, representing a CAGR of 1.3% and 1.4% respectively. For the second line TNBC that
targeted by our HX009, the number of patients in 2024 was approximately 33.5 thousand in
China and 218.9 thousand globally. Around 60% advanced TNBC patients failed first line
treatment and receive second line and above treatment.
Market Size
From 2019 to 2024, China’s TNBC drug market size increased from RMB3.8 billion in
2024, representing a CAGR of 1.9% from 2019 to 2024. The market size will climb to RMB5.0
billion and RMB5.9 billion in 2030 and 2035 respectively.
Historical and Forecasted TNBC Market in China, 2019-2035E
2019 2020 2021 2022 2023 2024 2025E 2026E 2027E 2028E 2029E 2030E 2031E 2033E 2032E 2034E 2035E
Billion RMB
Period
2019-2024
2024-2030E
2030E-2035E
CAGR
1.9%
4.8%
3.3%
3.5 3.5 3.6 3.6 3.7 3.8 3.9 4.1 4.3 4.5 4.7 5.0 5.3 5.5 5.7 5.8 5.9
Source: Literature Review, Annual report, Expert interview, Frost & Sullivan Analysis
INDUSTRY OVERVIEW
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China Competitive Landscape of Second Line and above TNBC Combination Therapy
Pipelines
As of the Latest Practicable Date, there were over 170 pipelines drugs of targeted therapy
for TNBC treatment in China, and there are over 90 pipeline drugs for the treatment of
second-line and above TNBC in clinical trials. Among them, 25 are combination pipelines (the
same kind of therapy as our HX009). Specifically, seven are in phase I, 14 are in phase I/II,
and four are in phase II.
Modality
First Posted Date/
CDE Acceptance
Date
Clinical
StageCombinationTreatment
LineIndicationsCompanyDrug Name
/CodeTarget
Antiboby-based fusion
protein2025/02/17INDCombination therapy with
Trastuzumab deruxtecan2L/3LTNBCHanx BioHX009PD-1, CD47
Small molecule2022/09/14Phase IICombination therapy with
Talazoparib2L+TNBCZenith EpigeneticsZEN-3694BET
Small molecule2022/12/09Phase II
Combination with systemic
chemotherapy (carboplatin and
gemcitabine, nab-paclitaxel, or
eribulin)
2L+TNBCBeBetter Med BEBT-209CDK4,CDK6
bsADC2023/07/10Phase IICombination therapy  with SI-
B0031L/2L+Solid Tumor (Including
TNBC)Baili-BioIzalontamab
brengitecanEGFR,HER3
ADC2024/07/02Phase IICombination therapy  with PD-
1 Inhibitor2L+TNBC
Maiweikang New
Drug Development
Co.
9MW2821Nectin-4
Small molecule/mAb2021/03/15Phase I/IICombination therapy with Nab-
paclitaxel2L+Solid Tumor (Including
TNBC)Cambrex/LaeknaAfuresertib + LAE005AKT/PDL1
Small molecule2021/11/08Phase I/IICombination with
chemotherapy2L+Solid tumor (Including
TNBC)
Ankang Biological
TechnologyTinengotinib
AURKA,AURKB,
CSF1R,JAK1,
JAK2,VEGFR,
FGFR
Small molecule2021/12/31Phase I/IICombination therapy with
toripalimab2L+Solid tumor (Including
TNBC)
De Novo
PharmatechDN1508052TLR8
Small molecule2022/02/10Phase I/II
Combination therapy with
doxorubicin hydrochloride
liposome, toripalimab
2L+Solid tumor (Including
TNBC)
InxMed
BiotechnologyIfebemtinibFAK
Small molecule2022/03/03Phase I/IICombination with
chemotherapy1L/2L+Solid tumor (Including
TNBC)AstraZenecaSaruparibPARP1
Small molecule2022/03/14Phase I/IICombination therapy with
zanubrutinib, tislelizumab2L+Solid tumor (Including
TNBC)BeiGeneBGB-10188PI3Kδ
ADC2022/08/18Phase I/IICombination therapy with
pembrolizumab 1L/2L+Solid tumor (Including
TNBC)Duality BiologicsDB-1305TROP2
ADC2022/10/19Phase I/IICombination therapy with
rilvegostomig2L+BTC, OC, TNBCAstraZenecaPuxitatug samrotecanB7-H4
Small molecule2023/06/30Phase I/IICombination therapy with
sintilimab2L+Solid tumor (Including
TNBC)
Haixi
PharmaceuticalsC019199CSF1R,VEGFR
2,DDR
ADC2023/09/11Phase I/IICombination therapy with
toripalimab2L+Solid tumor (Including
TNBC)RemegenRC108c-Met
Small molecule2023/11/27Phase I/II
Combined with fulvestrant,
dalirucizumab, toripalimab, nab
- paclitaxel, fluzoparib,
pyrotinib, and capecitabine.
2L+Solid Tumor (Including
TNBC)
Junshi Runjia
PharmaceuticalJS105PI3Kα
Small molecule2023/12/05Phase I/II
Combination therapy with
HRS-A1811, SHR-A2009,
adebrelimab
1L/2L+Breast Cancer
(Including TNBC)Hengrui MedicineHRS-8080ER
BsAb/
Antiboby-based fusion
protein
2025/09/02Phase I/II
Combination therapy with
Pemetrexed, Carboplatin,
SKB264, DS-8201a,
Enfortumab Vedotin
1L+Solid tumor (Including
TNBC)
Zhejiang Fukang
Pharmaceutical
Co., Ltd, Fukang
(Shanghai) Health
Technology Co.,
Ltd
CVL006PD-L1,VEGF
mAb2025/11/17Phase I/IICombination therapy with
nivolumab or docetaxel2L+Solid tumor (Including
TNBC)
Bristol Myers
SquibbBMS-986340CCR8
ADC2022/01/26Phase ICombination therapy with
pembrolizumab2L+Solid tumor (Including
TNBC)
BSP
Pharmaceuticals
S.p.A, Seagen, Pfizer
Investment CO., Ltd
PF-08046054PD-L1
Small molecule2022/08/15Phase ICombination therapy with
letrozole and fulvestrant3L+Solid tumor (Including
TNBC)PfizerTagtociclibCDK2
BsAb2024/06/14Phase ICombination therapy with
IMM27M2L+Solid tumor (Including
TNBC)ImmuneOncoPalverafusp alfaPD-L1,VEGF
BsAb2025/01/03Phase ICombination therapy with
ezabenlimab1L/2L+Solid tumor (Including
TNBC)
Boehringer
IngelheimBI765179FAP-α,4-1BB
Small molecule2025/01/13Phase ICombination with
chemotherapy2L+Solid tumor (Including
TNBC)
Hansoh
PharmaceuticalHS-10502PARP1
Small molecule2025/03/07Phase ICombination therapy with
pembrolizumab2L+Solid tumor (Including
TNBC)NovartisKFA115/
Small molecule2025/08/25Phase ICombination therapy with
Olaparib Tablets2L+Solid tumorSynRx
TherapeuticsSYN818POLQ
Source: CDE, Frost & Sullivan Analysis
Note: Table includes only therapies for the same indication and line of treatment
INDUSTRY OVERVIEW
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China Competitive Landscape of Approved Targeted Drug for TNBC Treatment
Date of
Approval
Treatment
StrategyIndicationsLine of TreatmentModalityCompanyDrug NameTarget
2024/12/25Mono
Adult patients with early-stage, high-
risk, human epidermal growth factor
receptor 2 (HER2)-negative breast
cancer who harbour a deleterious or
suspected deleterious germline BRCA
mutation (gBRCAm) and have
received neoadjuvant or adjuvant
chemotherapy.
AdjuvantSmall moleculeAstraZenecaOlaparib
PARP1,
PARP2,
PARP3
2024/12/01
Mono
Adult patients with germline BRCA-
mutated (gBRCAm), human
epidermal growth factor receptor 2
(HER2)-negative metastatic breast
cancer who have received
chemotherapy in the neoadjuvant,
adjuvant, or metastatic setting.
1L, 2LSmall moleculeJiangsu HengruiFluzoparibPARP
Combo with
Rivoceranib
2024/12/01Combo with
Fluzoparib
Adult patients with germline BRCA-
mutated (gBRCAm), human
epidermal growth factor receptor 2
(HER2)-negative metastatic breast
cancer who have received
chemotherapy in the neoadjuvant,
adjuvant, or metastatic setting.
1L, 2LSmall moleculeAdcentrxRivoceranibVEGFR2
2024/11/22MonoTNBC2LADCKelun-BiotechSacituzumab
tirumotecanTROP2
2024/06/18Combo with
Abraxane
For recurrent or metastatic TNBC
patients who are PD-L1 positive (CPS
≥ 1) as assessed by a fully validated
test.
1LmAb
Junshi
Shnghai/Suzhou
UNION
ToripalimabPD-1
2022/11/01Combo with
Chemotherapy
For the treatment of patients with
early-stage, high-risk triple-negative
breast cancer (TNBC) whose tumors
express PD-L1 (Combined Positive
Score (CPS) ≥ 20) as assessed by a
fully validated test.
Adjuvant, New
AdjuvantmAbMSDPembrolizumabPD-1
2022/06/07Monotriple negative breast cancer2LADCImmunomedics/Gi
lead
Sacituzumab
govitecanTROP2
Source: CDE, Frost & Sullivan Analysis
Treatment Paradigm of TNBC in China
Molecular Subtypes Recommended treatment
Chemo Chemo + Endocrine
Triple Negative
Breast Cancer
Grade I
Recommendation
Grade II
Recommendation
Grade I
Recommendation



Taxanes, including docetaxel, nab-paclitaxel, and paclitaxel; Anthracyclines, including epirubicin, pirarubicin, and
doxorubicin; Cyclophosphamide.
Anthracyclines, including epirubicin, pirarubicin, and doxorubicin; Taxanes, including docetaxel, nab-paclitaxel, and
paclitaxel.


Anthracyclines, including epirubicin, pirarubicin, and doxorubicin; Cyclophosphamide - Taxanes, including
docetaxel, nab-paclitaxel, and paclitaxel.
Anthracyclines, including epirubicin, pirarubicin, and doxorubicin; Cyclophosphamide - Taxanes, including
docetaxel, nab-paclitaxel, and paclitaxel and platinum-based chemotherapy.


Taxanes, including docetaxel, nab-paclitaxel, and paclitaxel and platinum-based chemotherapy-Anthracyclines,
including epirubicin, pirarubicin, and doxorubicin with pembrolizumab.
Taxanes, including docetaxel, nab-paclitaxel, and paclitaxel and platinum-based chemotherapy + PD-1 inhibitors.
Taxanes, including docetaxel, nab-paclitaxel, and paclitaxel and platinum-based chemotherapy.
Source: CSCO 2024, Frost & Sullivan Analysis
Note: The treatments listed are arranged according to their level of evidence, with treatments supported by more
rigorous and reliable research listed first.
INDUSTRY OVERVIEW
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The standard-of-care drugs for second line (i.e., Grade 1 recommendation for second line)
TNBC in China are chemotherapies including taxanes such as docetaxel combined with
carboplatin. HX009 is a bispecific antibody targeting both PD-1 and CD47. Compared to
chemotherapy drugs, HX009 is a targeted therapy. Antibody-targeted therapies show fewer side
effects and greater effectiveness compared to chemotherapy. The primary objective of the
HX009-II-04 China Study is to evaluate the safety and tolerability of HX009 in combination
with Enhertu
® in patients with HER2- low or ultra-low expressing unresectable locally
advanced or metastatic triple-negative breast cancer. The price reduction of Enhertu ® is overall
a significant positive development for the commercialization of combination therapies that
include it. By lowering the treatment cost, the price cut enhances patient access and accelerates
the adoption of Enhertu
® as the backbone of combination regimens. This increased usage
directly benefits its combination partners, as their products are positioned to be used alongside
a more widely accessible and rapidly scaling therapy. For any partner agent administered
alongside Enhertu
®, every additional Enhertu ® patient automatically becomes a potential user
of the combo drug, so the price reduction functions as a demand amplifier that boosts market
penetration and overall sales of the companion product.
Unmet Clinical Needs
 Complex resistance problem: Endocrine therapy has been the cornerstone treatment for
HR+/HER2- advanced breast cancer patients for a long time. As patients with
HR+/HER2- metastatic breast cancer become resistant to endocrine-based therapy, their
primary treatment option is limited to single-agent chemotherapy. In this setting, it is
common to receive multiple lines of chemotherapy regimens over the course of treatment,
and the prognosis remains poor. The emergence of CDK4/6 inhibitors has helped address
some patients’ resistance to endocrine therapy. However, with continued treatment, nearly
30-40% patients may develop resistance to CDK4/6 inhibitors, leading to disease
progression.
 Limited treatment options: TNBC is a subtype of breast cancer that accounts for
approximately 15% to 20% of all breast cancers and is associated with characteristics
such as younger age at onset, high invasiveness, and poor prognosis compared to HR+ or
HER2+ breast cancers. The five-year survival rate for advanced TNBC patients is only
12%. Due to the lack of hormonal and HER2-targeted therapies, TNBC is insensitive to
hormone therapy and targeted treatments, with chemotherapy remaining the standard
treatment approach. CSCO recommends chemotherapy regimens that include
anthracyclines and taxanes (such as the AC-T regimen). However, overall, the survival
benefits of chemotherapy alone are limited, and the prognosis remains relatively poor,
underscoring the urgent need for more effective treatment options.
 Expanding to first-line treatment: While the emergence of drugs such as small molecule
targeted drugs and immune checkpoint inhibitors has improved the prognosis for breast
cancer patients to some extent, their application is limited by factors such as the presence
of target mutations, PD-L1 expression, requiring very strict patient selection criteria.
Therefore, there is still a need to continue exploring new first-line treatment options that
benefit a broader population.
INDUSTRY OVERVIEW
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LA WS AND REGULATIONS IN THE PRC
Drug Regulatory Regime
Major Regulatory Authorities
The drug industry in the PRC is mainly administered by three governmental agencies: the
NMPA, a department under the SAMR, the National Health Commission of the PRC ( ʕശɛ
ึ) (the “ NHC”) and the National Healthcare Security
Administration (ღ҅) (the “ NHSA ”).
The NMPA, which inherits the drug supervision function from its predecessor the China
Food and Drug Administration (္ຖ၍ଣᐼ҅) (the “ CFDA ”), is the primary
drug regulator responsible for almost all of the key stages of the life-cycle of pharmaceutical
products, including non-clinical researches, clinical trials, marketing approvals,
manufacturing, advertising and promotion, distribution and pharmacovigilance.
The NHC, formerly known as the National Health and Family Planning Commission (the
“NHFPC ”), is China’s chief healthcare regulator. It is primarily responsible for formulating
national healthcare policy and regulating public health, medical services, and health
contingency system, coordinating the healthcare reform, and overseeing the operation of
medical institutions and practicing of medical personnel.
The NHSA, established in May 2018, is responsible for formulating and implementing
policies, plans and standards on medical insurance, maternity insurance and medical
assistance, administering healthcare security funds, formulating a uniform medical insurance
catalogue and payment standards on drugs, medical disposables and healthcare services,
formulating and administering the bidding and tendering policies for drugs and medical
disposables.
Reform of the Drug Approval System
According to the Administrative Measures for Drug Registration (ൗ̅၍ଣ፬
) (the “ Circular 27 ”), which was most recently promulgated on January 22, 2020 and took
effect on July 1, 2020, upon completion of pharmacological and toxicological studies, clinical
trials and other research supporting the marketing registration of drugs, determination of
quality standards, completion of validation of commercial-scale production processes, and
preparation for acceptance of verification and inspection for drug registration, the applicant
may apply for the New Drug Approval (the “ NDA”). The NMPA shall evaluate the application
pursuant to applicable laws and regulations. The applicant must obtain the NDA before the
drugs can be manufactured and sold in the PRC.
REGULATORY OVERVIEW
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If (i) a drug is used for the treatment of severe life-threatening diseases currently lacking
effective treatment and the data of clinical trials of the drug can prove the efficacy and forecast
the clinical value of the drug; (ii) a drug which is urgently needed for public health and the data
of clinical trials of the drug can show the efficacy and forecast the clinical value of the drug;
or (iii) a vaccine which is urgently needed to deal with major public health emergencies or
deemed to be urgently needed by the NHC, and by assessment the benefit of the vaccine
outweighs the risk, the applicant may apply for the conditional NDA during the clinical trials
of the drug or vaccine.
According to the Administrative Provisions on Special Examination and Approval of New
Drug Registration () issued by the CFDA on January 7, 2009
and effective therefrom, the special examination and approval by the CFDA for new drug
registration applications applies when (i) the effective constituent extracted from plants,
animals or minerals, etc. or the preparations thereof have never been marketed in the PRC, or
the medicinal materials are newly discovered or the preparations thereof; (ii) the chemical raw
medicines or the preparations thereof, or the biological products have not been approved for
marketing either in the PRC or aboard; (iii) the new drugs are for the treatment of such diseases
as AIDS, malignant tumors or rare diseases with distinctive clinical treatment advantages; or
(iv) the new drugs are for the treatment of the diseases currently lacking effective treatment.
Under the circumstances of (i) or (ii), the drug registration applicant (the “ Applicant ”) may
apply for the special examination and approval when submitting the application for clinical
trials of the new drug; while, under the circumstances of (iii) or (iv), the Applicant may only
apply for the special examination and approval when applying for production. The CFDA shall,
based on the application of the Applicant, give priority to those registration applications which
are determined in compliance with the aforementioned conditions after examination during the
registration process, and enhance the communication with the Applicant.
On August 9, 2015, the State Council promulgated the Opinions on the Reform of
Evaluation and Approval System for Drugs and Medical Devices (ᔼᐕኜ૛ᄲ
จԈ) (the “ Reform Opinions ”), which established a framework for reforming
the evaluation and approval system for drugs and medical devices. The Reform Opinions
indicated enhancing the standard of approval for drug registration and accelerating the
evaluation and approval process for innovative drugs.
On November 11, 2015, the Announcement of the CFDA on Several Policies on the
Evaluation and Approval of Drug Registration (ൗ̅ᄲ
ʮѓ) issued by the CFDA further simplified the approval process of drugs
that the IND of new drugs are subject to one-off umbrella approval instead of declaration,
evaluation and approval by stages.
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On March 4, 2016, the General Office of the State Council promulgated the Guiding
Opinions on Promoting the Sound Development of the Medical Industry (ආᔼᖹପุ
ኬจԈ), which aims to accelerate the development of innovative drugs and
biological products with major clinical needs, to speed up the promotion of green and
intelligent pharmaceutical production technologies, to strengthen scientific and efficient
supervision, and to promote the development of industrial internationalization.
On October 8, 2017, the General Office of Chinese Communist Party’s Central Committee
and the General Office of the State Council jointly issued the Opinion on Strengthening the
Reform of the Drug and Medical Device Review and Approval Process to Encourage Drug and
Medical Device Innovation (จԈ)
(the “ Innovation Opinion ”), which sought to streamline the clinical trial process and shorten
the timeline. The Innovation Opinion provided special fast-track approval for new drugs and
medical devices in urgent clinical need, and drugs and medical devices for rare diseases.
On December 21, 2017, the CFDA promulgated the Opinions on Implementing Priority
Review and Approval to Encourage Drug Innovation (௴อྼБᎴ΋ᄲ൙ᄲҭ
จԈ), which further clarified that a fast-track clinical trial approval or drug registration
pathway will be available to innovative drugs. The aforementioned opinion was repealed by the
Announcement of NMPA on Issuing Three Documents including Working Procedures for
Review of Breakthrough Therapeutics (Trial) (issued and took effect on July 7, 2020) (࢕
೯б<ᄲ൙ʈЪ೻ҏ(༊Б)>ʮѓ).
On May 17, 2018, the NMPA and NHC jointly promulgated the Circular on Issues
Concerning Optimizing Drug Registration Review and Approval (ൗ̅ᄲ൙ᄲ
ʮѓ), which further simplified and accelerated the clinical trial approval
process.
On July 7, 2020, the Priority Evaluation and Approval Procedures for Marketing
Approvals of Drugs (Trial) (ɪ̹஢̙Ꮄ΋ᄲ൙ᄲҭʈЪ೻ҏ(༊Б)) issued by the
NMPA further indicated that a fast-track IND or drug registration pathway will be available to
the innovative drugs.
On March 31, 2023, the China’s Center for Drug Evaluation under the NMPA (ۜ
ᄲ൙ʕː) (the “ CDE”) issued the CDE’s Standards for Accelerating the
Review Work for Marketing Approval Applications of Innovative Drugs (Trial) ( ᖹᄲʕː̋
Ҟ௴อᖹɪ̹஢̙͡ሗᄲ൙ʈЪ஝ᇍ(༊Б)), which encouraged the development process of
the innovative drugs of breakthrough therapy drug program, for children and for rare diseases,
and is expected to expedite the marketing process of these drugs to meet relevant patients’
medication needs.
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Principal Regulatory Provisions
Laws and Regulations on New Drugs
Research and Development of New Drugs
The Drug Administration Law of the PRC () (the “ Drug
Administration Law ”) promulgated by the Standing Committee of the National People’s
Congress (the “ SCNPC ”) in September 1984, last amended on August 26, 2019 and became
effective on December 1, 2019, and the Implementation Regulations of the Drug
Administration Law of the PRC (ૢԷ) (the
“Implementation Regulations ”) promulgated by the State Council in August 2002 and last
amended on December 6, 2024 and became effective on January 20, 2025, have laid down the
legal framework for the establishment and maintenance of pharmaceutical manufacturing and
trading enterprises, as well as for the administration of pharmaceutical products including the
development and manufacturing of new drugs. According to the Drug Administration Law and
the Implementation Regulations, the PRC encourages the research and development of new
drugs, and protects the legal rights and interests in the research and development of new drugs.
The developer and clinical trial applicant of any new drug shall truthfully submit the new
drug’s manufacturing method, quality specifications, results of pharmacological and
toxicological tests and the related data, documents and samples to the NMPA for approval
before any clinical trial is conducted.
Non-clinical Research and Animal Testing
The non-clinical safety evaluation study for drugs for the purpose of applying for drug
registration shall be conducted in accordance with the Administrative Measures for Good
Laboratories Practice (Ӻሯඎ၍ଣ஝ᇍ), which was promulgated in August
2003 and amended in July 2017 by the CFDA. In April 2007, the CFDA issued The
Administrative Measures for Certification of Good Laboratory Practice (Ӻሯ
), last amended on January 19, 2023 and taking effect on July 1,
2023, which set forth the requirements for an institution to apply for a Certification of Good
Laboratory Practice to undertake non-clinical research on drugs.
The State Science and Technology Commission, now known as the Ministry of Science
and Technology (ኪҦஔ௅), promulgated the Regulations for the Administration of Affairs
Concerning Experimental Animals (၍ଣૢԷ) on November 14, 1988, which
were most recently amended by the State Council on March 1, 2017. The State Science and
Technology Commission and the State Bureau of Quality and Technical Supervision (now
merged into the SAMR) jointly promulgated the Administration Measures on Good Practice of
Experimental Animals () on December 11, 1997. The Ministry of
Science and Technology and other regulatory authorities promulgated the Administrative
Measures on the Certificate for Experimental Animals (Trial) (ج(༊
Б)) on December 5, 2001. All of these laws and regulations require a Certificate for Use of
Laboratory Animals for performing experimentation on animals.
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Pathogenic Microorganism Laboratories
Pursuant to the Regulations on Administration of Bio-safety in Pathogenic
Microorganism Laboratories (τΌ၍ଣૢԷ) promulgated by the
State Council, effective on November 12, 2004, and latest amended on December 6, 2024 and
became effective on January 20, 2025, pathogenic microorganism laboratories are classified
into four levels, namely bio-safety levels 1, 2, 3 and 4 in terms of bio-safety protection levels
in accordance with national standards on biosafety of laboratories. Laboratories at bio-safety
levels 1 and 2 shall only engage in laboratory activities related to highly pathogenic
microorganisms which can be carried out in laboratories at bio-safety levels 1 and 2 as
specified in the pathogen microorganism catalog. The construction, alternation or expansion of
a laboratory at bio-safety level 1 or 2 shall be filed for record with the local counterparts of
NHC. The entity launched a pathogenic microorganism laboratory shall develop a scientific
and strict management system, regularly inspect the implementation of the regulations on
bio-safety, and regularly inspect, maintain and update the facilities, equipment and materials
in the laboratory, to ensure its compliance with the national standards.
Application for Clinical Trial and Drug Clinical Trial Registration
According to the Decision on Adjusting the Approval Procedures of Certain
Administrative Approval Items for Drugs (Ӕ
) promulgated by the CFDA on March 17, 2017, the decision on the approval of clinical
trials of drugs shall be made by the CDE from May 1, 2017. According to the Circular 27, drug
clinical trials shall be divided into Phase I clinical trial, Phase II clinical trial, Phase III clinical
trial, Phase IV clinical trial, and bioequivalence trial. In accordance with Circular 27 and the
Announcement on Adjusting Evaluation and Approval Procedures for Clinical Trials for Drugs
(ʮѓ) issued in July 2018, if a clinical trial
applicant does not receive any negative or questioned opinions from the CDE within 60 days
after the date when the trial application is accepted and the fees are paid, the Applicant can
proceed with the clinical trial in accordance with the trial protocol submitted to the CDE.
After obtaining the approval of clinical trial from the NMPA, the applicant must complete
the clinical trial registration at the Drug Clinical Trial Information Platform for public
disclosure in accordance with the Circular on Drug Clinical Trial Information Platform ( ᗫ
ʮѓ), which came into effect in September 2013. The applicant
shall complete the initial registration of the trial within one month after obtaining the approval
of clinical trial to obtain an exclusive trial registration number, and then complete the
subsequent information registration before the first patient is enrolled in the trial and submit
the registration for public disclosure for the first time.
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Conduct of Clinical Trial
Typically, pursuant to Circular 27, drug clinical trials in China shall go through four
phases — Phase I clinical trial, Phase II clinical trial, Phase III clinical trial and Phase IV
clinical trial. Based on the characteristics of drugs and research objective, the research contents
shall include clinical pharmacology research, exploratory clinical trial, confirmatory clinical
trial and post-marketing research clinical. The NMPA requires that the different phases of
clinical trials in China shall receive ethics committee approval respectively and comply with
the relevant requirements of quality management standards for clinical trials of drugs in PRC.
The sponsor shall submit safety update reports on the CDE website regularly during the
research and development period. The sponsor shall promptly report to the CDE regarding
suspicious and unexpected serious adverse reaction and other potential serious safety risks
arising in the course of the clinical trial. Based on the severity of the safety risks, the sponsor
may be required to adopt measures to strengthen risk control, and may be required to suspend
or terminate the clinical trial of drugs where necessary.
According to Circular 27, where a drug approved to carry out clinical trials intends to add
new indications (or functional indications) or add combination with other drugs, the applicant
shall submit a new drug clinical trial application, and the new drug clinical trial may only be
conducted after approval.
However, according to the Technical Guiding Principles for Clinical Trials of Anti-tumor
Drugs () issued by the CFDA on May 15, 2012, the
clinical study staging of anti-tumor drugs is not a fixed developmental sequence. The rapid
development of anti-tumor drug research theories and technologies is likely to have an impact
on future anti-cancer drug development models. Therefore, applicants can actively explore
more scientific and rational research methods and promptly seek advice from the drug
registration department under the NMPA.
According to the Technical Guidelines for Clinical Trials of Anticancer Drug
Combination Therapy () issued by the (CDE) on
December 30, 2020, before initiating combination therapy with anticancer drugs, there should
first be sufficient rational basis for the combination therapy as its theoretical foundation, and
then comprehensive evaluation should be conducted according to the clinical trial data
characteristics of each single drug to carry out combination therapy clinical trials based on
scientific evidence; the overall principle of clinical trial design for anticancer drug
combination therapy is to design based on in-depth mechanistic research data, explore the
clinical advantages of combination therapy, and ultimately confirm clinical value; for rare
malignant tumors or those with very limited benefit from existing treatments, factorial design
requirements will be considered based on the clinical benefits and needs of combination
therapy; for complex scenarios of anticancer drug combination therapy, applicants are
encouraged to communicate with the Center for Drug Evaluation to jointly promote the
scientific and orderly development of combination therapy with anticancer drugs.
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On November 15, 2021, the CDE introduced the Guiding Principles for Clinical Research
and Development of Anti-tumor Drugs Oriented by Clinical V alue (Ҥ
) (the “ Guiding Principle ”), for anti-tumor drugs, which states
that the fundamental purpose of the drug market is to address the needs of patients, and
emphasizes that drug research and development should be based on patient needs and clinical
value.
After obtaining clinical trial approval, the applicant shall conduct clinical trials at
qualified clinical trial institutions. The qualified clinical trial institutions refers to institutions
that have the conditions to conduct clinical trials in accordance with the requirements and
technical guidelines set forth in the Regulations for the Administration of Drug Clinical Trial
Institutions (), which came into effect on December 1, 2019.
Such clinical trial institutions shall be subject to filing requirements, with the exception of
institutions that only engage in analysis of biological samples which shall not be subject to
such filing requirements. The NMPA is responsible for setting up a filing management
information platform for the registration, filing and operation management of drug clinical trial
institutions, as well as the entry, sharing and disclosure of information from the supervision
and inspection activities conducted by the drug regulatory authorities and competent healthcare
authorities.
Clinical trials must be conducted in accordance with the Good Clinical Practice for Drug
Trials (ᑗґ༊᜕ሯඎ၍ଣ஝ᇍ), promulgated by NMPA and NHC on April 23, 2020
and effective on July 1, 2020, which stipulates the requirements for the procedures of
conducting clinical trials, including pre-clinical trial preparation, trial protocols, protection of
testees’ rights and interests, duties of researchers, sponsors and monitors, as well as data
management and statistical analysis.
According to the Announcement on Adjusting Evaluation and Approval Procedures for
Clinical Trials for Drugs (ʮѓ), where the
application for clinical trial of new investigational drug has been approved, upon the
completion of Phases I and II clinical trials and prior to Phase III clinical trial, the applicant
shall submit the application for communication meetings to the CDE to discuss with the CDE
the key technical questions including the design of Phase III clinical trial protocol. According
to the Administrative Measures for Communication on the Research, Development and
Technical Evaluation of Drugs (), revised by the
CDE on December 10, 2020, during the research and development periods and in the
registration applications of, among others, the innovative new drugs, the applicants may
propose to conduct communication meetings with the CDE. The communication meetings can
be classified into three types. Type I meetings are convened to address key safety issues in
clinical trials of drugs and key technical issues in the research and development of
breakthrough therapeutic drugs. Type II meetings are held during the key research and
development stages of drugs, mainly including meetings before submitting the clinical trial
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application, meetings upon the completion of Phase II trials and prior to Phase III trials,
meetings before submitting the marketing application for a new drug, and meetings for risk
evaluation and control. Type III meetings refer to other meetings not classified as Type I or
Type II.
New Drug Registration
Pursuant to Circular 27, upon completion of clinical trials, determination of quality
standards, completion of validation of commercial-scale production processes and completion
of other related preparation works, the applicant may apply with the NMPA for the marketing
authorization. The NMPA then determines whether to approve the application according to
applicable laws and regulations and with the comprehensive evaluation opinion provided by
the CDE of the NMPA.
The applicant must obtain the marketing authorization for a new drag before the drug can
be manufactured and sold in the China market. According to Circular 27, the holders of any
of the following drugs can apply for conditional approval of such drugs: (i) drugs which are
used for the treatment of severe life-threatening diseases currently lacking effective treatment
and the data of clinical trials can confirm their efficacy and forecast their clinical value; (ii)
drugs which are urgently needed for public health and data of clinical trials can demonstrate
their efficacy and forecast their clinical value; and (iii) vaccines which are urgently needed to
deal with major public health emergencies or other vaccines which the NHC deems to be
urgently needed, the benefits of both of which are assessed to be outweigh the risk.
Regulations relating to International Multi-Center Clinical Trials and Acceptance of Overseas
Clinical Trial Data
On January 30, 2015, the CFDA promulgated the Notice on Issuing the International
Multi-Center Clinical Trial Guidelines (Trial) (یܸ(༊
Б)ஷѓ) (the “ IMCT Guidelines ”), which took effect on March 1, 2015, to provide
guidance for the regulation of application, implementation and administration of international
multi-center clinical trials in China. Pursuant to the IMCT Guidelines, international multi-
center clinical trial applicants may simultaneously perform clinical trials in different centers
using the same clinical trial protocol. Where the applicant plans to make use of the data derived
from the international multi-center clinical trials for application to the CFDA for approval of
NDA, such international multi-center clinical trials shall satisfy the requirements set forth in
the Drug Administration Law and the Implementation Regulations and relevant laws and
regulations.
On July 6, 2018, the NMPA issued the Technical Guiding Principles for the Acceptance
of the Overseas Clinical Trial Data of Drugs (ࡡ
) (the “ Guiding Principles ”), which provides that overseas clinical data can be submitted
for all kinds of registration applications in China, including the clinical trial authorization and
NDA. The Guiding Principles clearly list the basic principles and requirements on the
acceptance of overseas clinical trial data, and distinguish different levels of acceptance based
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on the quality of the data itself and different circumstances. The Guiding Principles require that
the applicant shall ensure that the overseas clinical trial data are truthful, complete, accurate
and traceable, and the generating process of the overseas clinical trial data shall comply with
the relevant requirements of the Good Clinical Practice of the International Council for
Harmonisation of Technical Requirements for Pharmaceuticals for Human Use (ICH-GCP).
Marketing Authorization Holder Mechanism
Under the authorization of the SCNPC, the General Office of the State Council issued the
Pilot Plan for the Drug Marketing Authorization Holder System (ܓ
) on May 26, 2016, which provides a detailed pilot plan for the marketing
authorization holder system, or MAH System, for drugs in 10 provinces (cities) in China and
the plan ended on November 4, 2018. The pilot period was later extended to November 4, 2019
by the SCNPC.
Pursuant to the Drug Administration Law, China implements the marketing authorization
holder mechanism for management of the drug industry. The drug marketing authorization
holder refers to an enterprise or a drug research and development institution that has obtained
the drug registration certificate. The drug marketing authorization holder shall be responsible
for non-clinical research, clinical trials, production and operation, post-marketing research,
adverse reaction monitoring, reporting and processing of drugs in accordance with the
provisions of the law.
The marketing authorization holders may manufacture drugs by themselves or entrust a
pharmaceutical manufacturing enterprise to manufacture drugs. Likewise, they may sell drugs
by themselves or entrust a pharmaceutical distribution enterprise to sell drugs. However,
marketing authorization holders may not entrust a pharmaceutical manufacturing enterprise to
produce blood products, narcotic drugs, psychotropic drugs, medical-use toxic drugs or
pharmaceutical precursor chemicals, except as otherwise stipulated by the drug regulatory
department under the State Council. The drug marketing authorization holder shall establish a
drug quality assurance system and be equipped with special personnel to take charge of quality
management on drugs independently. The drug marketing authorization holder shall regularly
review the quality management system of the drug manufacturer and the drug distributor, and
supervise its continuous quality assurance and control capabilities. Where the marketing
authorization holder is an overseas enterprise, its designated domestic enterprise shall perform
the obligations of the marketing authorization holder and jointly assume responsibilities of the
marketing authorization holder with the overseas enterprise.
Gathering, Collection and Filing of Human Genetic Resources
Pursuant to the Service Guide for Administrative Licensing of Gathering, Collection,
Deal, Export and Exit Approval of Human Genetic Resources of Human genetic resources
() promulgated
by the Ministry of Science and Technology in July 2015 and the Notice on the Implementation
of the Administrative License for the Gathering, Collection, Deal, Export and Exit of Human
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Genetic Resources (ஷ
) promulgated by the Ministry of Science and Technology in August 2015, the gathering
and collection of human genetic resources though clinical trials by a foreign-invested sponsor
shall be approved by the China Human Genetic Resources Management Office. The General
Office of the Ministry of Science and Technology promulgated the Notice on Optimizing the
Administrative Examination and Approval Process of Human Genetic Resources (Ꮄʷ
) in October 2017, which has simplified the approval
process for the gathering and collection of human genetic resources for the marketing of drugs
in China.
Pursuant to the Regulations on the Management of Human Genetic Resources of the
People’s Republic of China ( ʕശɛ͏΍ձ਷ɛᗳ፲ෂ༟๕၍ଣૢԷ) promulgated by the
State Council in May 2019 and came into effect on July 1, 2019, and the last amendment
became effective on May 1, 2024, the state supports the rational use of human genetic
resources for scientific research, development of the biomedical industry, improvement of
diagnosis and treatment technology, improvement of China’s ability to guarantee biosafety and
improvement of the level of people’s health. Foreign organizations, individuals and institutions
established or actually controlled by them shall not gather or preserve Chinese genetic
resources in China, or provide Chinese genetic resources to foreign countries. In addition, the
gathering, preservation, utilization and external provision of Chinese genetic resources shall
conform to ethical principles and conduct ethical review in accordance with relevant
regulations. On May 26, 2023, the Ministry of Science and Technology issued the
Implementing Rules of the Administrative Regulations on Human Genetic Resources ( ɛᗳ
), effective from July 1, 2023, which further provided specific
provisions on the collection, preservation, utilization and external provision of human genetic
resources of the PRC.
On October 17, 2020, the PRC Biosecurity Law () (the
“Biosecurity Law ”) was promulgated by the SCNPC, taking effect from April 15, 2021 and
latest amended on April 26, 2024. The Biosecurity Law establishes a comprehensive legislative
framework for the pre-existing regulations in such areas as epidemic control of infectious
diseases for humans, animals and plants; research, development, and application of biology
technology; biosecurity management of pathogenic microbials laboratories; security
management of human genetic resources and biological resources; countermeasures for
microbial resistance; and prevention of bioterrorism and defending threats of biological
weapons.
Regulations of Biological Products
According to Circular 27, drug registration shall be subject to registration and
administration by categories, namely Chinese medicine, chemical medicine and biological
products etc. Biological product registration shall be categorized in accordance with biological
product innovative medicine, biological product improved new medicine, marketed biological
products (including biosimilars), etc. In order to cooperate with the implementation of the
Circular 27, the NMPA formulated the Registration Classification of Biological Products and
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Requirements for Application Materials (Ӌ), and the
Registration Classification of Biological Products part came into effect on July 1, 2020 while
the Requirements for Application Materials part came into effect on October 1, 2020.
According to Guidelines on the Acceptance and Review for Registration of Therapeutic
Biological Products (Trial) (یܸݟ(༊Б)), in general,
therapeutic biological products under Categories 13 to 15 shall conduct Phase III clinical trial
only and may submit plans for Phase III clinical trial and relevant clinical application
materials.
Special Examination and Approval Procedures
On November 18, 2005, the CFDA promulgated the Procedures of the CFDA for the
Special Examination and Approval of Drugs (तйᄲҭ೻
ҏ), which stipulates that in the case of any threatening or actual public health emergency,
the CFDA shall take a series of measures to facilitate the approval procedures so that the drugs
needed in responding to the public health emergency can be approved as soon as possible.
Administrative Protection and Monitoring Periods for New Drugs
According to the Implementation Regulations, to protect public health, the NMPA may
provide for administrative monitoring periods of up to five years for new drugs approved to be
manufactured, to consistently monitor the safety of such new drugs. During the monitoring
period of a new drug, the NMPA will not approve any other enterprises’ applications to
manufacture or import a similar new drug.
Laws and Regulations on the Manufacturing of Drugs
Contract Manufacturing of Drugs
Pursuant to the Administrative Regulations for the Contract Manufacturing of Drugs
() issued by the CFDA in August 2014, only when a drug
manufacturer temporarily lacks manufacturing conditions due to technology upgrade or is
unable to ensure market supply due to insufficient manufacturing capabilities, can such drug
manufacturer entrust the manufacturing of the drug to another domestic drug manufacturer.
Such contract manufacturing arrangements shall be approved by the provincial branch of the
NMPA.
The Administrative Measures on Supervision of Drug Manufacturing (͛ପ္ຖ၍
) promulgated by the SAMR on January 22, 2020 and effective on July 1, 2020 further
implements the drug marketing authorization holder system as stipulated in the Drug
Administration Law. Drug marketing authorization holders entrusting others to manufacture
drugs shall enter into outsourcing agreements and quality agreements with qualified drug
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manufacturing enterprises and submit the relevant agreements together with the actual
manufacturing site application materials to the competent drug administrative authority in
order to apply for the Drug Manufacturing Certificate.
Advertising of Drugs
According to the Advertising Law of the PRC (), which was
promulgated by the SCNPC on October 27, 1994 and last amended on April 29, 2021, certain
contents such as statement on cure rate or efficiency shall not be included in the advertisement
of drugs.
According to the Interim Administrative Measures for the Review of Advertisements for
Drugs, Medical Devices, Health Food, and Formula Food for Special Medical Purposes ( ᖹ
) issued by the
SAMR on December 24, 2019 and came into effect on March 1, 2020, the advertisements for
drugs shall not be released without being reviewed and the contents of a drug advertisement
shall be based on the drug instructions approved by the drug administration departments.
Product Liability
The Product Quality Law of the PRC (), as amended and
effective as of December 29, 2018, applies to all production and sale activities in the PRC.
Pursuant to the Product Quality Law of the PRC, products offered for sale must satisfy relevant
quality and safety standards. Violations of state or industrial standards for health and safety and
any other related violations may result in civil liabilities and administrative penalties, such as
compensation for damages, fines, suspension or shutdown of business, as well as confiscation
of products illegally produced and sold and the proceeds from such sales.
According to the Civil Code of the PRC (Պ) promulgated by the
National People’s Congress (the “ NPC”) on May 28, 2020 and effective from January 1, 2021,
where a patient suffers damage due to defects in a drug, the patient may claim for compensation
from the holder of the marketing approval for the drug, manufacturer or the medical institution.
Where the patient claims for compensation from the medical institution, the medical
institution, after making compensation, shall have the right of recovery against the liable
holder of the marketing approval for the drug or manufacturer.
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 the lawful rights and interests of consumers
in purchasing, using or accepting goods or services for the purpose of daily life consumption.
The State Council promulgated the Implementation Regulations of the Law of the PRC
on the Protection of Consumers’ Rights and Interests (ྼ
ૢԷ) on March 15, 2024, which came into effect on July 1, 2024. The State aimed to
strengthen the protection of the lawful rights and interests of consumers and have in place a
common governance system for the protection of consumers’ rights and interests that integrates
law-abiding operators, industry self-discipline, consumer participation, government
supervision and social oversight.
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Other PRC Regulations Relating to the Pharmaceutical Industry
National Essential Drug List
According to the Opinions of the General Office of the State Council on Improving the
National Essential Drugs System (จԈ) issued on
September 13, 2018 and effective therefrom, the Circular on the Printing and Distribution of
the Administrative Measures for the National Essential Drug List (ͦ
) issued on February 13, 2015 and effective therefrom, and the National
Essential Drug List (2018 version) (ͦ፽(2018و)) (the “ National
Essential Drug List ”) issued by the NHC on September 30, 2018 and effective from November
1, 2018, basic healthcare institutions funded by the government, which primarily include
county-level hospitals, county-level Chinese medicine hospitals, rural clinics and community
clinics, shall store up and use drugs listed in the National Essential Drug List. The drugs listed
in the National Essential Drug List shall be purchased by centralized tender process and shall
be subject to the price control by the National Development and Reform Commission (೯
ึ) (the “ NDRC ”). Remedial drugs listed in the National Essential Drug List are
all listed in the medical insurance catalogue and the entire amount of the purchase price of such
drugs is entitled to reimbursement.
Price Controls and Two-invoice System
Instead of direct price controls which were historically used in China, the government
regulates prices mainly by establishing a consolidated procurement mechanism, revising
medical insurance reimbursement standards and strengthening regulation of medical and
pricing practices.
According to the Certain Regulations on the Trial Implementation of Centralised Tender
Procurement of Drugs by Medical Institutions (ʍ஝
) promulgated on July 7, 2000 and the Notice of NMPA on Further Improvement on the
Implementation of Centralised Tender Procurement of Drugs by Medical Institutions (࢕
) promulgated on
July 23, 2001, not-for-profit medical institutions established by county or higher level
government are required to implement centralised tender procurement of drugs.
The Ministry of Health promulgated the Working Regulations of Medical Institutions for
Procurement of Drugs by Centralised Tender and Price Negotiations (for Trial Implementation)
(ᅺમᒅձණʕᙄᄆમᒅʈЪ஝ᇍ(༊Б)) on March 13, 2002, which
provides rules for the tender process and negotiations of the prices of drugs, operational
procedures, a code of conduct and standards or measures of evaluating bids and negotiating
prices. According to the Notice of the Financial Planning Department of Ministry of Health on
Issue of Opinions on Further Regulating Centralised Procurement of Drugs by Medical
Institutions (Ι೯<จԈ>ٙ
) promulgated on January 17, 2009, not-for-profit medical institutions owned by the
government at the county level or higher or owned by state-owned enterprises (including
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state-controlled enterprises) shall purchase pharmaceutical products by online centralized
procurement. Each provincial government shall formulate its catalogue of drugs subject to
centralised procurement. Except for drugs in the National List of Essential Drugs (the
procurement of which shall comply with the relevant rules on National List of Essential
Drugs), certain pharmaceutical products which are under the national government’s special
control, such as toxic, radioactive and narcotic drugs and traditional Chinese medicines, in
principle, all drugs used by not-for-profit medical institutions shall be covered by the catalogue
of drugs subject to centralised procurement. The Opinions of the General Office of the State
Council on Improvement of the Policy of Production, Circulation and Use of Drugs ( ਷ਕ৫
ʍจԈ) promulgated on January 24,
2017 by the General Office of the State Council aims to deepen the reform of medicine health
system, improve the quality of the drug and regulate the distribution and use of the drug. The
Notice of the General Office of the State Council on Issuing Pilot Plan of Centralised
Procurement and Use of the Drug Organised by the State (ଡ଼ᔌ
) promulgated on January 1, 2019 aims to improve the
pricing mechanism of the drug, which also further regulates the scope and mode of centralized
procurement.
The centralized tender process takes the form of public tender operated and organized by
provincial or municipal government agencies. The centralised tender process is in principle
conducted once every year in the relevant province or city in China. The bids are assessed by
a committee composed of pharmaceutical and medical experts who will be randomly selected
from a database of experts approved by the relevant governmental authorities. The committee
members assess the bids based on a number of factors, including but not limited to, bid price,
product quality, clinical effectiveness, product safety, qualifications and reputation of the
manufacturer, after-sale services and innovation. Only pharmaceuticals that have won in the
centralised tender process may be purchased by public medical institutions funded by the
governmental or state-owned enterprise (including state-controlled enterprises) in the relevant
region.
In order to further optimize the order of purchasing and selling pharmaceutical products
and reduce circulation steps, under the 2016 List of Major Tasks in Furtherance of the
Healthcare and Pharmaceutical Reforms (ࠧ2016ᓃʈЪ΂ਕ)
issued by the General Office of the State Council on April 21, 2016, the “two-invoice system”
(ՇୃՓ) will be fully implemented in the PRC. According to the Circular on Issuing the
Implementing Opinions on Carrying out the Two-invoice System for Drug Procurement among
Public Medical Institutions (for Trial Implementation) (મᒅ
ʕપБ“ՇୃՓ”จԈ(༊Б)) (the “ Two-Invoice System Notice ”), which came
into effect on December 26, 2016, the two-invoice system means one invoice between the
pharmaceutical manufacturer and the pharmaceutical distributor, and one invoice between the
pharmaceutical distributor and the medical institution, and thereby only allows a single level
of distributor for the sale of pharmaceutical products from the pharmaceutical manufacturer to
the medical institution.
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According to the Two-Invoice System Notice and the Several Opinions of the General
Office of the State Council on Further Reforming and Improving the Policies on Drug
Production, Circulation and Use (ഄ
ʍจԈ) issued on January 24, 2017, the two-invoice system would be promoted in pilot
provinces (or autonomous regions and municipalities directly under the central government)
involved in the comprehensive medical reform program and pilot cities for public hospital
reform on a priority basis, and encouraged to be implemented nationwide in 2018.
Coverage of the National Medical Insurance Program
The national medical insurance program was first adopted according to the Decision of
the State Council on Establishing the Urban Employees’ Basic Medical Insurance System ( ਷
) issued by the State Council on December
14, 1998, under which all employers and their employees in urban cities are required to enroll
in the basic medical insurance program and the insurance premium is jointly contributed by the
employers and employees. On July 10, 2007, the State Council issued the Guiding Opinions of
the State Council on the Pilot Urban Resident Basic Medical Insurance (۬࢝
ኬจԈ), which further expanded the coverage of the basic
medical insurance program, and accordingly the urban non-employed residents of the pilot
districts may voluntarily enroll in the Urban Resident Basic Medical Insurance. In addition, on
January 3, 2016, the Opinions of the State Council on Integrating the Basic Medical Insurance
Systems for Urban and Rural Residents (จ
Ԉ) issued by the State Council required the integration of the urban resident basic medical
insurance and the new rural cooperative medical care system and the establishment of a unified
basic medical insurance system, which will cover all urban and rural residents other than rural
migrant workers and persons in flexible employment arrangements who participate in the basic
medical insurance for urban employees. The participants of the medical insurance programs are
eligible for full or partial reimbursement of the cost of the medicines included in the national
medical insurance catalogue.
Pursuant to the Notice of the Tentative Administrative Measures of the Scope of Basic
Medical Insurance Coverage for Pharmaceutical Products for Urban Employees (۬
) jointly issued by the Ministry of Labor
and Social Security, the Ministry of Finance and other authorities on May 12, 1999, a
pharmaceutical product listed in the medical insurance catalogue must be clinically necessary,
safe, effective, reasonably priced, easy to use, available in sufficient quantity, and must meet
any of the following requirements: (i) being included in the pharmacopoeia of the PRC, (ii)
satisfying the standards as set out by the NMPA, or (iii) having been approved by the NMPA
for imported.
According to the Tentative Administrative Measures of the Scope of Basic Medical
Insurance Coverage for Pharmaceutical Products for Urban Employees, the Ministry of Labor
and Social Security and other relevant governmental authorities have the power to determine
the medicines to be included in the national medical insurance catalogue, which is divided into
two parts of Part A and Part B. Provincial governments are required to include all Part A
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medicines listed in the national medical insurance catalogue in their provincial medical
insurance catalogue, but have the discretion to adjust upwards or downwards by no more than
15% from the total number of Part B medicines listed in the national medical insurance
catalogue. As a result, the contents of Part B of the provincial medical insurance catalogues
may differ from region to region in the PRC. Patients purchasing medicines included in Part
A of the medical insurance catalogue are entitled to reimbursement in accordance with the
regulations in respect of basic medical insurance. Patients purchasing medicines included in
Part B of the medical insurance catalogue are required to pay a certain percentage of the
purchase price and the remainder shall be reimbursed in accordance with the regulations in
respect of basic medical insurance. The percentage of reimbursement for Part B medicines is
decided by local authorities and as a result may differ from region to region.
Medical Insurance Reimbursement Standards
According to the Decision of the State Council on Establishing the Urban Employees’
Basic Medical Insurance System, the Opinions on the Establishment of the New Rural
Cooperative Medical System () issued by the
General Office of the State Council on January 16, 2003, the Guiding Opinions of the State
Council on the Pilot Urban Resident Basic Medical Insurance and the Opinions of the State
Council on Integrating the Basic Medical Insurance Systems for Urban and Rural Residents,
medical insurance shall be available to all employees and residents in both rural and urban
areas.
According to the Notice on Printing and Distribution of the Opinion on the Management
of Diagnosis and Treatment Items, Scope and Payment Standards of Medical Service Facilities
Covered by the Urban Employees Basic Medical Insurance Program (Ι೯<ᕄᔖʈਿ
ᇍఖձ˕˹ᅺ๟จԈ>) issued on June 30,
1999, the basic medical insurance program may cover a portion of the costs of diagnostic and
treatment devices and diagnostic testing. The scope and rate of reimbursement shall be decided
by provincial policies.
On June 20, 2017, the General Office of the State Council issued the Guidance on Further
Deepening the Reform of the Payment Method of Basic Medical Insurance (ආɓӉଉ
ኬจԈ), which aimed to implement a diverse medical
insurance payment mechanism that includes diagnosis-related groups, per-capita payments,
and per-bed-day payments.
By 2020, such new reimbursement mechanism will be implemented across the country,
replacing the current reimbursement method based on service category and product price.
Local medical insurance authorities shall implement the total budget control for their
respective administrative regions and determine the amount of reimbursement to public
hospitals based on their performance and the expenditure targets of the individual basic
medical insurance funds.
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Laws and Regulations on Intellectual Properties
Patent
Patents in the PRC are mainly protected by the Patent Law of the PRC ( ʕശɛ͏΍ձ
), which was promulgated by the SCNPC on March 12, 1984, last amended on
October 17, 2020 and became effective on June 1, 2021, and the Implementation Rules of the
Patent Law of the PRC (), which were promulgated by the
State Council on June 15, 2001, last amended on December 11, 2023 and became effective on
January 20, 2024. The Patent Law of the PRC and its Implementation Rules provide for three
types of patents, “invention”, “utility model” and “design.” “Invention” refers to new technical
solution relating to a product, a process or improvement thereof; “utility model” refers to new
technical solution relating to the shape, structure, or their combination, of a product, which is
suitable for practical use; and “design” refers to a new design of the shape, pattern, or a
combination thereof, as well as a combination of the color, shape and pattern, of the entirety
or a portion of a product, which creates an esthetic feeling and is suitable for industrial
application. The duration of a patent right for “invention” is 20 years, the duration of a patent
right for “utility model” is 10 years, and the duration of a patent right for “design” is 15 years,
from the date of application. According to the Patent Law of the PRC, for the purpose of public
health, the patent administrative department of the State Council may grant mandatory
licensing to manufacture and export patented drugs to countries or regions in comply with
provisions of the relevant international treaty participated by the PRC.
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) establishing a drug
patent linkage system (ܓv) 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.
Trade Secret
According to the Anti-Unfair Competition Law of the PRC ( ʕശɛ͏΍ձ਷ˀʔ͍຅
), promulgated by the SCNPC in September 1993, last amended on June 27, 2025 and
came into effect on October 15, 2025, the term “trade secrets” refers to technical, operational
or other commercial information that is unknown to the public, and is of commercial value for
which the right holder has taken corresponding confidentiality measures. Under the Anti-
Unfair Competition Law of the PRC, business persons are prohibited from infringing others’
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trade secrets by: (1) acquiring a trade secret from the right holder by theft, bribery, fraud,
coercion, electronic intrusion, or any other illicit means; (2) disclosing, using, or allowing
another person to use a trade secret acquired from the right holder by any means as specified
in the item (1) above; (3) disclosing, using, or allowing another person use a trade secret in its
possession, in violation of its confidentiality obligation or the requirements of the right holder
for keeping the trade secret confidential; (4) abetting a person, or tempting, or aiding a person
into or in acquiring, disclosing, using, or allowing another person to use the trade secret of the
right holder in violation of his or her non-disclosure obligation of the requirements of the right
holder for keeping the trade secret confidential. If a third party knows or should have known
that an employee or a former employee of the right holder of a trade secret or any other entity
or individual has committed an above motioned illegal act but still acquires, discloses, uses, or
allows another person to use the trade secret, the third party shall 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 shall
stop the illegal activities, confiscate illegal income, and impose fine on the infringing parties.
Trademark
Pursuant to the Trademark Law of the PRC () promulgated by
the SCNPC on August 23, 1982, last amended on April 23, 2019 and became effective on
November 1, 2019, the period of validity for a registered trademark is 10 years, commencing
from the date of registration. Upon expiry of the period of validity, the registrant shall go
through the formalities for renewal within twelve months prior to the date of expiry as required
if the registrant needs to continue to use the trademark. Where the registrant fails to do so, a
grace period of six months may be granted. The period of validity for each renewal of
registration is 10 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 in accordance with applicable
laws.
Copyright
Copyright in the PRC is primarily protected by the Copyright Law of the PRC ( ʕശ
), which was promulgated by the SCNPC on September 7, 1990, last
amended on November 11, 2020 and became effective on June 1, 2021, and Implementation
Regulations of the Copyright Law of PRC (ૢԷ), which
was promulgated by the State Council on August 2, 2002 last amended on January 30, 2013,
and became effective on March 1, 2013. These law and regulation provide provisions on the
classification of works and the obtaining and protection of copyright.
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Domain Name
In accordance with the Measures for the Administration of Internet Domain Names ( ʝ
) which was issued by the Ministry of Information Technology on August
24, 2017 and came into effect on November 1, 2017, the Ministry of Industry and Information
Technology is responsible for supervision and administration of domain name services in the
PRC and communications administrative bureaus at provincial levels shall conduct supervision
and administration of the domain name services within their respective administrative
jurisdictions. Domain name registration services shall, in principle, be subject to the principle
of “first apply, first register.” A domain name registrar shall, in the process of providing
domain name registration services, ask the applicant for which the registration is made to
provide authentic, accurate and complete identity information on the holder of the domain
name and other domain name registration related information.
Regulations on Data Security
On November 7, 2016, the SCNPC promulgated the Cybersecurity Law of the PRC ( ʕ
) (the “ Cybersecurity Law ”), which became effective from June 1,
2017. Regarding network operation security, the Cybersecurity Law requires network operators
to implement technical measures and other necessary measures in accordance with laws,
regulations, and mandatory requirements of national and industry standards to ensure network
security, maintain stable operation, effectively respond to cybersecurity incidents, prevent
cybercrimes, and protect the integrity, confidentiality, and availability of network data. In
terms of personal information protection, the Cybersecurity Law outlines the basic principles
and requirements for protecting personal information.
On June 10, 2021, the SCNPC promulgated the Data Security Law of the PRC ( ʕശ
) (the “ Data Security Law ”), which became effective from
September 1, 2021. According to the Data Security Law, a data classification protection system
shall be established to protect data by classification. Entities engaged in data processing
activities shall, in accordance with the laws and regulations, establish a sound whole-process
data security management system, organize data security education and training, and take
corresponding technical measures and other necessary measures to ensure data security. The
Data Security Law also establishes a national security review system for data processing
activities that affect or may affect national security.
According to the Civil Code of the PRC, personal information of natural persons is
protected by law. Any organization or individual that needs to obtain personal information of
others shall obtain legally and ensure the information security, and shall not illegally collect,
use, process, transmit, trade, provide or disclose personal information of others. The Personal
Information Protection Law of the PRC () (the “ Personal
Information Protection Law ”), promulgated by the Standing Committee of the National
People’s Congress on August 20, 2021, and effective from November 1, 2021, further
emphasizes and details the obligations and responsibilities of personal information processors
in their processing activities. It establishes a comprehensive system of rules for personal
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information processing, including requirements for explicit and reasonable purposes,
additional protections for sensitive personal information, specific agreements for external
provision and entrusted processing to ensure security, and adherence to specific rules for
storage, deletion, disclosure, and automated decision-making. Personal information processors
must have appropriate organizational, institutional, and technical measures in place. The
Personal Information Protection Law provides four compliance paths for the cross-border
provision of personal information: undergoing a security assessment organized by the
Cyberspace Administration of China (܃the “ CAC”), signing and
filing a standard contract for cross-border personal information transfer with the provincial
CAC, applying for personal information protection certification, and adhering to international
treaties or agreements that China has joined or participated in.
The “CAC”, jointly with the other 12 governmental authorities, promulgated the
Cybersecurity Review Measures () on December 28, 2021, which
became effective on February 15, 2022. Pursuant to Article 2 of the Cybersecurity Review
Measures, to ensure the security of the supply chain of critical information infrastructure,
security of network and data and safeguard national security, a cybersecurity review is required
when national security has been or may be affected where critical information infrastructure
operators (٫purchase network product or service and network
platform operators (٫conduct data process activities. In addition, Article 7 of
the Cybersecurity Review Measures stipulates that when a network platform operator in
possession of personal information of over one million users intends to “list abroad” ( ਷̮),
it must apply to CAC for a cybersecurity review.
According to the Measures on Security Assessment of Cross-border Data Transfer ( ᅰ
) (the “ Security Assessment Measures ”), which was promulgated by
the CAC on July 7, 2022 and came into effect on September 1, 2022, data processors shall
apply for cross-border security assessment with the CAC through the local provincial-level
cyberspace administration department under any of the following circumstances: (i) cross-
border transfer of important data by data processors; (ii) cross-border transfer of personal
information by critical information infrastructure operators and data processors that process
more than 1 million personal information; (iii) cross-border transfer of personal information by
data processors that have made cross-border transfer of personal information of 100,000 people
or sensitive personal information of 10,000 people cumulatively since January 1 of the
previous year; and (iv) other circumstances where an application for security assessment of
cross-border data transfer is required as prescribed by the CAC.
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According to the Provisions on Promoting and Regulating Cross-border Data Flows (ڮ
), (the “ Cross-border Data Provisions ”), promulgated by the
CAC on March 22, 2024, and effective on the same day, unless exempted by the Cross-border
Data Provisions, data processors must apply for a security assessment for cross-border data
transfer with the provincial CAC at their location if they meet one of the following conditions:
(i) critical information infrastructure operators (CIIOs) providing personal information or
important data abroad; (ii) data processors other than CIIOs providing important data abroad,
or cumulatively transferring personal information of more than 1 million individuals
(excluding sensitive personal information) or more than 10,000 individuals’ sensitive personal
information abroad since January 1 of the current year. These provisions replace the
requirements for data security assessments related to cross-border transfers under the Security
Assessment Measures. Additionally, if data has not been designated or publicly announced as
important data by relevant departments or regions, data processors are not required to declare
a security assessment for the cross-border provision of such data as important data.
Regulations in Relation to Company Establishment, Foreign Investment and Outbound
Investment
Company Establishment
The establishment, operation and management of corporate entities in China are governed
by the Company Law of the PRC () (the “ Company Law ”), which
was promulgated by the SCNPC on December 29, 1993 and lasted revised on December 29,
2023 and effective from July 1, 2024. The last amendment of the Company Law became
effective on July 1, 2024. The major revisions made by the last amendment of the Company
Law included improvement of the system for the establishment and exit of companies,
optimization of organizational structures of companies, improvement of capital system of
companies, strengthening the responsibilities of the controlling shareholder and management
staff, enhancing the social responsibilities of companies, etc.
Foreign Direct Investment
According to the Foreign Investment Law of the PRC ()
(the “ FIL”), which was promulgated by the National People’s Congress on March 15, 2019 and
came into effect on January 1, 2020, and the Regulations for Implementing the Foreign
Investment Law of the PRC (ૢԷ), which was
promulgated by the State Council on December 26, 2019 and came into effect on January 1,
2020, the foreign investment refers to the investment activities in China carried out directly or
indirectly by foreign natural persons, enterprises or other organizations, including the
following: (i) Foreign Investors establishing foreign-invested enterprises in China alone or
collectively with other investors; (ii) Foreign Investors acquiring shares, equities, properties or
other similar rights of Chinese domestic enterprises; (iii) Foreign Investors investing in new
projects in China alone or collectively with other investors; and (iv) Foreign Investors
investing through other ways prescribed by laws and regulations of the State Council. The State
adopts the management system of pre-establishment national treatment and negative list for
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foreign investment. The pre-establishment national treatment refers to granting to Foreign
Investors and their investments, in the stage of investment access, the treatment no less
favorable than that granted to domestic investors and their investments; the negative list refers
to special administrative measures for access of foreign investment in specific fields as
stipulated by the State. The State will grant national treatment to foreign investments outside
the negative list. The negative list will be released by or upon approval of the State Council.
Foreign investment in China is subject to the Catalogue for the Encouraged Investment
Industries (2022 Edition) ( ོᎸ̮ਠҳ༟ପุͦ፽(2022و)) issued on October 26, 2022
and took effect on January 1, 2023, and the Special Administrative Measures for the Access of
Foreign Investment (Negative List) (2024 Edition) (݄(૶
ఊ))(2024وissued on September 6, 2024, which together comprise the encouraged
foreign-invested industries catalogue and the special administrative measures for the access of
foreign investments to the restricted or the prohibited foreign-invested industries. The latter
sets out restrictions such as percentage of shareholding and qualifications of senior
management. According to the Measures for the Reporting of Foreign Investment Information
() which took effect on January 1, 2020, foreign investments that
are not subject to special access administrative measures are only required to complete an
online filing to the commerce departments.
Regulations relating to Outbound Investment
Pursuant to the Administrative Measures on Outbound Investments ( ྤ̮ҳ༟၍ଣ፬
) issued by the Ministry of Commerce of the PRC ( ਠਕ௅) (the “ MOFCOM ”) on March
16, 2009 and amended on September 6, 2014, the MOFCOM and the provincial competent
departments of commerce shall subject the outbound investments of enterprises to filing or
approval, depending on the actual circumstances of such investments. Outbound investments
of enterprises involving sensitive country or region, or sensitive industry shall be subject to
approval. Other outbound investments of enterprises shall be subject to filing.
Pursuant to the Administrative Measures for the Outbound Investments of Enterprises
() issued by the NDRC on December 26, 2017 and effective from
March 1, 2018, if an enterprise in the territory of the PRC (the “ Investor ”) intends to make
outbound investments, it shall go through the formalities, such as approval or filing, for the
outbound investment project (the “ Project ”), report relevant information and cooperate in the
supervisory inspections. The sensitive Projects invested directly by the Investor or through the
foreign enterprises controlled by the Investor shall be subject to approval. The non-sensitive
Projects invested directly by the Investor, which involve the direct contribution of assets, rights
and interests, or provision of financing or guarantee by the Investor, shall be subject to filing.
The aforementioned sensitive Projects include the Projects involving sensitive country or
region, or sensitive industry. The Catalogue of Sensitive Sectors for Outbound Investment
(2018 Edition) ( ྤ̮ҳ༟ઽชБุͦ፽(2018و)) issued by the NDRC on January 31,
2018 and effective from March 1, 2018 listed in detail the sensitive sectors.
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Laws and Regulations on Labor and Employee Incentives
Labor, Social Insurance and Housing Provident Funds
According to the Labor Law of the PRC (), which was
promulgated by the SCNPC in July 1994 and last amended and came into effect in December
2018, the Labor Contract Law of the PRC (), which was
promulgated by the SCNPC in June 2007 and amended in December 2012 and came into effect
in July 2013, and the Implementing Regulations of the Labor Contracts Law of the PRC ( ʕ
ૢԷ), which was promulgated by the State Council and came
into effect in September 2008, labor contracts in written form shall be executed to establish
labor relationships between employers and employees. In addition, wages shall not be lower
than local minimum wages. The employers must establish a system for labor safety and
sanitation, strictly comply with national rules and standards, provide education regarding labor
safety and sanitation to its employees, provide employees with labor safety and sanitation
conditions and necessary protection materials in compliance with national rules, and carry out
regular health examinations for employees engaged in work involving occupational hazards.
According to the Social Insurance Law of the PRC (),
which was promulgated by the SCNPC in October 2010 and last amended and came into effect
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 last 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 last amended in 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 and maternity insurance and to housing provident funds. Any employer who fails to
make the required contributions may be fined and ordered to compensate the deficit within a
stipulated time limit.
According to the Interpretation II by the Supreme People’s Court of the PRC on Legal
Issues in the Trial of Labor Dispute Cases (ਪ
༆ᙑ(ɚ)), promulgated by the Supreme People’s Court on August 1, 2025 and effective
from September 1, 2025, any agreement between a PRC employer and an employee or an
employee’s undertaking to the employer on the non-contribution of social insurance shall be
deemed invalid by the people’s court. If an employee requests to terminate the employment
agreement and seek economic compensation on the grounds that the employer has failed to pay
social insurance contributions in accordance with the applicable laws, the people’s court shall
support such claims.
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Employee Stock Incentive Plans
On February 15, 2012, the State Administration of Foreign Exchange of the PRC (࢕
̮ි၍ଣ҅) (the “ SAFE ”) issued the Circular on Issues concerning the Foreign Exchange
Administration for Domestic Individuals Participating in Share Incentive Plans of Overseas
Publicly Listed Companies (ྌ̮ි၍ଣϞᗫਪ
) (the “ Share Incentive Rules ”). Under the Share Incentive 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 SAFE
through a domestic qualified agent, which could be a PRC domestic company participating in
such stock incentive plan, and complete certain procedures. In addition, the State Taxation
Administration of the PRC (೼ਕᐼ҅) (the “ STA”) has issued circulars concerning
employee share options or restricted shares. Under these circulars, employees working in the
PRC who exercise share options, or whose restricted shares vest, will be subject to PRC
individual income tax. The domestic qualified agent have obligations to file documents related
to employee share options or restricted shares with relevant tax authorities and to withhold
individual income tax of those employees related to their share options or restricted shares. If
the employees fail to pay, or the PRC domestic companies fail to withhold, their individual
income tax according to relevant laws, rules and regulations, the PRC domestic companies may
face sanctions imposed by the tax authorities or other relevant PRC governmental authorities.
Laws and Regulations on Environmental and Fire Control
Environmental Protection
The Environmental Protection Law of the PRC () (the
“Environmental Protection Law ”), which was promulgated by the SCNPC on December 26,
1989, came into effect on the same day, last amended on April 24, 2014 and came into effect
on January 1, 2015, outlines the authorities and duties of various environmental protection
regulatory agencies. The Ministry of Ecology and Environment is authorized to issue national
standards for environmental quality and emissions, and to monitor the environmental
protection scheme of the PRC. Meanwhile, local environment protection authorities may
formulate local standards which are more rigorous than the national standards, in which case,
the concerned enterprises must comply with both the national standards and the local standards.
Environmental Impact Appraisal
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,
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before the commencement of construction, submit the environmental impact report or the
environmental impact statement to the relevant authority at 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 Appraisal Law of the PRC ( ʕശɛ͏
) (the “ Environmental Impact Appraisal Law ”), which was
promulgated by the SCNPC on October 28, 2002, amended on July 2, 2016 and December 29,
2018, for any construction projects that have an impact on the environment, an entity is
required to produce either a report, or a statement, or a registration form of such environmental
impacts depending on the seriousness of effect that may be exerted on the environment.
The Law of the PRC on the Prevention and Control of Water Pollution ( ʕശɛ͏΍ձ
) was last revised by the SCNPC on June 27, 2017 and implemented on
January 1, 2018. The law stipulates that the discharge of water pollutants shall not exceed the
prescribed water pollutant discharge standards and the total discharge control targets of key
water pollutants. Enterprises, institutions and other production and operation units directly or
indirectly discharging industrial waste water and medical sewage to waters and enterprises,
institutions and other production and operation units required to obtain pollutant discharge
license before discharging waste water and sewage must obtain the pollutant discharge license.
The pollutant discharge license specifies requirements on the types, concentration, total
amount and discharging direction of the water pollutants to be discharged. The specific
measures for pollutant discharge licensing shall be prescribed by the State Council. In addition,
according to the Administrative Measures for the Licensing of Discharge of Urban Sewage into
the Drainage Network () promulgated by the
Ministry of Housing and Urban-Rural Development (ண௅) of the PRC on
January 22, 2015, last revised on December 1, 2022 and effective on February 1, 2023,
enterprises, institutions and individual industrial and commercial enterprises engaged in
manufacturing, construction, catering and medical activities must apply for a license for the
discharge of sewage into the drainage network before discharging sewage into urban facilities.
On April 1, 2024, Ministry of Ecology and Environment ( ͛࿒ᐑྤ௅) promulgated the
Measures for Pollutant Discharge Permitting Administration (), which
came into effect on July 1, 2024. According to the Measures for Pollutant Discharge Permitting
Administration, enterprises, public institutions and other producers and business operators
shall, in accordance with factors such as the amount of pollutants produced, the amount of
pollutants discharged and the extent of their impact on the environment, carry out the
management of pollutant discharge permits with a focus, simplified management and pollutant
discharge registration. The specific scope of pollutant discharging entities under priority
pollutant discharge permitting administration or those under summary pollutant discharge
permitting administration shall be governed by the classification administration list of
pollutant discharge permitting for fixed pollution sources. The pollutant discharging entity
that, in accordance with the law, shall apply for a pollutant discharge permit in accordance with
the law and discharge pollutants in accordance with the relevant provisions. Those who has not
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obtained a discharge permit shall not discharge pollutants. The pollutant discharge registration
entity that needs to fill out a pollutant discharge registration form shall register its pollutant
discharge on the National Pollutant Discharge Permit Management Information Platform.
Fire Control
Pursuant to the Fire Protection Law of the PRC ()
promulgated by the SCNPC on April 29, 1998, and last amended on April 29, 2021 and
effective therefrom, the Department of Emergency Management under the State Council and
the local people’s governments at or above county level shall supervise and administer the
matters of fire protection, while the fire control and rescue institutions of such people’s
governments shall be responsible for implementation. The design of fire control of the
construction projects must comply with the national technical standards of fire control. If the
design of fire control of a construction project has not been examined pursuant to the relevant
laws or failed to pass the examination, the construction of such project is not allowed. If a
completed construction project has not gone through the fire safety inspection or failed to
satisfy the requirements of fire safety upon inspection, such project is not allowed to be put to
use or business.
Laws and Regulations on Foreign Exchange and Taxation
Foreign Exchange Administration
The principal law governing foreign currency exchange in the PRC is the PRC
Administrative Regulations on Foreign Exchange ( ʕശɛ͏΍ձ਷̮ි၍ଣૢԷ) (the
“Foreign Exchange Regulations ”), which was promulgated by the State Council on January
29, 1996 and most recently revised on August 5, 2008. According to the Foreign Exchange
Regulations, international payments in foreign currencies and transfer of foreign currencies
under current items shall not be restricted. Foreign currency transactions under the capital
account are still subject to limitations and require approvals from, or registration with, the
SAFE or its local counterpart and other relevant PRC governmental authorities.
Pursuant to the Regulation of Settlement, Sale and Payment of Foreign Exchange ( ഐ
) issued by the People’s Bank of China on June 20, 1996 which
became effective on July 1, 1996, foreign-invested enterprises may only buy, sell or remit
foreign currencies at banks authorized to conduct foreign exchange business after providing
valid commercial supporting documents and, in the case of transactions under the capital
account, obtaining approvals from the SAFE or its local counterpart.
According to the Circular on Reforming the Management Approach regarding the
Settlement of Foreign Exchange Capital of Foreign-invested Enterprises (̮ි၍ଣ҅ᗫ
) (the “ Circular 19 ”), which was
promulgated by the SAFE on March 30, 2015, came into effect on June 1, 2015 and revised on
December 30, 2019 and March 23, 2023, a foreign-invested enterprise may, according to its
actual business needs, settle with a bank the portion of the foreign exchange capital in its
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capital account, i.e., a bank account opened by a foreign-invested enterprise where the foreign
shareholder(s) are required to remit and deposit the amount of respective capital contributions,
for which the relevant foreign exchange bureau has confirmed monetary contribution rights and
interests (or for which the bank has registered the account-crediting of monetary contribution).
Meanwhile, the use of such RMB should still comply with the restrictions set in the Circular
19 that it cannot be directly or indirectly used for making payments beyond the business scope
of the enterprise or payments prohibited by national laws and regulations, investing in
securities unless otherwise provided by laws and regulations, granting the entrust loans in
RMB (unless permitted by the scope of business), repaying the inter-enterprise borrowings
(including advances by the third party) repaying the bank loans in RMB that have been lent to
a third party, and paying the expenses related to the purchase of real estate not for self-use,
except for the foreign-invested real estate enterprises.
According to the Circular on Optimizing Foreign Exchange Administration to Support the
Development of Foreign-related Business (ऒุ̮ਕ
) issued by the SAFE on April 10, 2020 which took effect therefrom, the reform
to facilitate the payments of proceeds under the capital accounts shall be promoted nationwide
by the SAFE. Provided that the use of funds is true and compliant, and in compliance with the
current administrative provisions on the use of the proceeds under the capital accounts,
enterprises satisfying the requirements are not required to provide the banks with supporting
documents to prove authenticity for each transaction beforehand when making domestic
payments with the proceeds under the capital accounts, such as the capital funds and the
proceeds of foreign debt or overseas listing. On June 9, 2016, the SAFE promulgated the
Notice on Reforming and Standardizing the Administrative Provisions on Capital Account
Foreign Exchange Settlement (ஷ
) (the “ Circular 16 ”) and revised on December 4, 2023. According to the Circular 16,
enterprises registered in China could settle the external debts in foreign currencies to RMB at
their own discretion. The SAFE Circular 16 sets a uniform standard for discretionary
settlement of foreign currencies under capital accounts (including but not limited to foreign
currency capital and external debts), which is applicable to all enterprises registered in China.
Dividend Distribution
On January 18, 2017, the SAFE promulgated the Notice on Improving the V erification of
Authenticity and Compliance to Further Promote Foreign Exchange Control (ආɓӉપ
), which stipulates several capital control
measures with respect to outbound remittance of profits from domestic entities to offshore
entities, including the following: (i) 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 (ii) 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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Taxation
Individual Income Tax
Pursuant to the Individual Income Tax Law of the PRC (੻೼
) (the “ IIT Law ”) promulgated by the SCNPC on September 10, 1980, last amended on
August 31, 2018 and effective on January 1, 2019, and the Implementation Regulations for the
Individual Income Tax Law of the PRC (ૢԷ) (the
“Implementation Regulations for the IIT Law ”) last amended by the State Council on
December 18, 2018 and implemented on January 1, 2019, dividend income derived by
individual investors from PRC domestic enterprises (no matter the place of payment is in the
PRC or not) shall be subject to individual income tax at a tax rate of 20% and shall be withheld
by the PRC domestic enterprises, except for tax-exempt income stipulated in international
conventions and agreements to which the PRC Government is a party, as well as other
tax-exempt income and tax reduction circumstances stipulated by the State Council.
Pursuant to the IIT Law and the Implementation Regulations for the IIT Law, gains on
transfer of properties (including gains derived by individuals from the transfer of priced
securities, equity, shares of property in a partnership enterprise) in subject to individual income
tax at the rate of 20%. Pursuant to the Circular on Declaring that Individual Income Tax
Continues to Be Exempted over Individual Gains from Transfer of Shares (Cai Shui Zi [1998]
No. 61) (ٝ(ৌ೼ο[1998]61 ໮))
issued jointly by the Ministry of Finance and the STA on March 30, 1998 and implemented
therefrom, from January 1, 1997, gains of individuals from the transfer of shares of listed
companies continue to be exempted from individual income tax.
Enterprise Income Tax
The Enterprise Income Tax Law of the PRC () (the
“EIT Law ”), promulgated by the NPC on March 16, 2007, came into effect on January 1, 2008
and amended on February 24, 2017 and December 29, 2018 by the SCNPC, as well as the
Implementation Rules of the EIT Law (ૢԷ) (the
“Implementation Rules ”), promulgated by the State Council on December 6, 2007, came into
force on January 1, 2008, last amended on December 6, 2024 and became effective on January
20, 2025, are the principal law and regulation governing enterprise income tax in the PRC.
According to the EIT Law and its Implementation Rules, enterprises are classified into resident
enterprises and non-resident enterprises. Resident enterprises refer to enterprises that are
legally established in the PRC, or are established under foreign laws but whose actual
management bodies are located in the PRC. And non-resident enterprises refer to enterprises
that are legally established under foreign laws and have set up institutions or sites in the PRC
but with no actual management body in the PRC, or enterprises that have not set up institutions
or sites in the PRC but have derived incomes from the PRC. A uniform income tax rate of 25%
applies to all resident enterprises and non-resident enterprises that have set up institutions or
sites in the PRC to the extent that such incomes are derived from their set-up institutions or
sites in the PRC, or such income are obtained outside the PRC but have an actual connection
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with the set-up institutions or sites. And non-resident enterprises that have not set up
institutions or sites in the PRC or have set up institutions or sites but the incomes obtained by
the said enterprises have no actual connection with the set-up institutions or sites, shall pay
enterprise income tax at the rate of 10% in relation to their income sources from the PRC. The
Circular on Issues Relating to the Withholding and Remittance of Enterprise Income Tax by
PRC Resident Enterprises on Dividends Distributed to Overseas Non-Resident Enterprise
Shareholders of H Shares (͏ΆุΣྤ̮H˾ϔ˾ᖮ
) issued by the STA on November 6, 2008 and implemented
therefrom, further clarified that a PRC resident enterprise shall withhold enterprise income tax
at a rate of 10% on the dividends of the year 2008 and onwards distributed to overseas
non-resident enterprise shareholders of H shares. An enterprise income tax preference shall be
granted to industries and projects strongly supported and encouraged by the state; an enterprise
income tax shall be levied on high-tech enterprises at a reduced rate of 15%.
Pursuant to the EIT Law and the Implementation Rules, income from equity investment
between qualified resident enterprises such as dividends and bonuses, which refers to
investment income derived by a resident enterprise from direct investment in another resident
enterprise, is tax-exempt income. Moreover, the Arrangement between the Mainland of China
and the Hong Kong Special Administrative Region for the Avoidance of Double Taxation and
the Prevention of Fiscal Evasion with Respect to Taxes on Incomes (ਜ
τર) was promulgated by the STA on August 21,
2006 and was most recently amended by the Fifth Protocol ratified by the STA on July 19, 2019
and came into effect on December 6, 2019. The Arrangement stipulates that a PRC resident
enterprise which distributes dividends to its Hong Kong shareholders should pay income tax
according to PRC laws; however, if the beneficiary of the dividends is a Hong Kong resident
enterprise, which directly holds no less than 25% equity interests of the aforementioned
enterprise (i.e. the dividend distributor), the tax levied shall be 5% of the distributed dividends.
If the beneficiary is a Hong Kong resident enterprise, which directly holds less than 25% equity
interests of the aforementioned enterprise, the tax levied shall be 10% of the distributed
dividends. Meanwhile, the Announcement of the State Taxation Administration on Certain
Issues Concerning the “Beneficial Owners” in the Tax Treaties (֛
ʕ“Ϟɛ”ʮѓ), promulgated by the STA on February 3, 2018 and came
into effect on April 1, 2018, has stipulated some factors that are unfavorable to the
determination of “beneficial owner.”
In addition, under the Circular of the STA on Relevant Issues Concerning the
Implementation of Dividend Clauses in Tax Treaties (ࢹٰ֛
), which was promulgated by the STA and came into effect on February
20, 2009, all of the following requirements should be satisfied where a tax resident of the
counterparty to the tax treaty needs to be entitled to such tax treatment specified in the tax
treaty for the dividends paid to it by a PRC resident enterprise: (i) such tax resident who
obtains dividends should be a company as provided in the tax treaty; (ii) the equity interests
and voting shares of the PRC resident enterprise directly owned by such a tax resident reach
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a specified percentage; and (iii) the capital ratio of the PRC resident enterprise directly owned
by such a tax resident reaches the percentage specified in the tax treaty at any time within 12
consecutive months prior to acquiring the dividends.
V alue-Added Tax (the “ VAT”)
The major PRC laws and regulations governing value-added tax are the Interim
Regulations on V alue-added Tax of the PRC (೼ᅲБૢԷ) issued on
December 13, 1993 by the State Council, came into effect on January 1, 1994, and revised on
November 10, 2008, February 6, 2016 and November 19, 2017, as well as the Implementation
Rules for the Interim Regulations on V alue-Added Tax of the PRC (೼
) issued on December 25, 1993 by the Ministry of Finance ( ʕശɛ͏΍
௅) (the “ MOF”), came into effect on the same day and revised on December 15, 2008
and October 28, 2011, any entities and individuals engaged in the sale of goods, supply of
processing, repair and replacement services, and import of goods within the territory of the
PRC are taxpayers of V A T and shall pay the V A T in accordance with the law and regulation.
The rate of V A T for sale of goods is 17% unless otherwise specified, such as the rate of V A T
for sale of transportation is 11%.
With the V A T reforms in the PRC, the rate of V A T has been changed several times. The
MOF and the STA issued the Notice of on Adjusting V A T Rates (೼ਕᐼ҅ᗫ
) on April 4, 2018 to adjust the tax rates of 17% and 11%
applicable to any taxpayer’s V A T taxable sale or import of goods to 16% and 10%, respectively,
this adjustment became effect on May 1, 2018. Subsequently, the MOF, the STA and the
General Administration of Customs jointly issued the Announcement on Relevant Policies for
Deepening the V A T Reform (ٙ
ʮѓ) on March 20, 2019 to make a further adjustment, which came into effect on April 1,
2019. The tax rate of 16% applicable to the V A T taxable sale or import of goods shall be
adjusted to 13%, and the tax rate of 10% applicable thereto shall be adjusted to 9%.
Laws and Regulations on Overseas Securities Offering and Listing by Domestic
Companies
Regulations relating to Overseas Listing
On February 17, 2023, the CSRC promulgated the Trial Administrative Measures of the
Overseas Securities Offering and Listing by Domestic Companies ( ྤʫΆุྤ̮೯БᗇՎձ
) (the “ Trial Measures ”) and relevant five guidelines. The Trial Measures
will comprehensively improve and reform the existing regulatory regime for overseas offering
and listing of PRC domestic companies’ securities and will 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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According to the Trial Measures, a domestic company seeking direct overseas offering
and listing shall file with the CSRC, submit the filing report, legal opinions and other relevant
materials as required under the Trial Measures, and state the shareholders’ information and
other matters in a truthful, accurate and complete manner. Where a domestic company submits
an application for initial public offering to the competent overseas regulators, such domestic
company shall file with the CSRC within three business days after such application is
submitted. The Trial Measures also require subsequent reports to be filed with the CSRC on
material events, such as a change-of-control event, or voluntary or forced delisting of the issuer
who has completed the overseas offering and listing. If the issuer fails to complete the filing
procedure or conceals any material fact or falsifies any major content in its filing documents,
it may be subject to administrative penalties, such as order to rectify, warnings, fines, and its
controlling shareholders, actual controllers, the person directly in charge and other directly
liable persons may also be subject to administrative penalties, such as warnings and fines.
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On the same day, the CSRC also held a press conference for the release of the Trial
Measures and issued the Notice on Administration for the Filing of Overseas Offering and
Listing by Domestic Companies (),
which, among others, clarified that, a domestic company that has already obtained the approval
document from the CSRC for overseas public offering and listing may proceed with the
overseas listing within the validity period of the approval document. Where the overseas listing
has not been completed upon the expiration of the approval document, filing procedures
specified in the Trial Measures shall be made as required.
On February 24, 2023, the CSRC and other related government authorities promulgated
the Provisions on Strengthening Confidentiality and Archives Administration of Overseas
Securities Offering and Listing by Domestic Companies (̋੶ྤʫΆุྤ̮೯БᗇՎձ
) (the “ Confidentiality Provisions ”), which was
implemented on March 31, 2023. Pursuant to the Confidentiality Provisions, an enterprise
within the territory of China shall, in accordance with laws, report to the competent authority
having the power of approval and licensing for approval and report to the confidentiality
administration authority at the same level for filing when providing or disclosing in public the
documents or materials that involve state secrets or working secrets of state organs, or
providing or disclosing in public by means of its overseas listing entity to related securities
company, securities service institutions, overseas regulators, other institutions and persons. An
enterprise within the territory of China shall perform corresponding procedures in accordance
with related provisions of the state when providing accounting archives or their duplicates to
related securities companies, securities service institutions, overseas regulators, other
institutions and individuals. Working papers produced within the territory of China by
securities companies and securities service institutions for the overseas securities issuance and
listing of the enterprise within the territory of China shall be retained within the territory of
China. When it is necessary to send the working papers overseas, they shall complete the
approval procedure in accordance with related provisions of China.
H-share Full Circulation
“Full circulation” means listing and circulating on the Hong Kong Stock Exchange of the
domestic unlisted shares of an H-share listed company, including unlisted domestic shares held
by domestic shareholders prior to overseas listing, unlisted domestic shares additionally issued
after overseas listing, and unlisted shares held by foreign shareholders. On November 14, 2019,
the CSRC issued the Guidelines for the “Full Circulation” Program for Domestic Unlisted
Shares of H-share Listed Companies ( H΅͡ሗ“ஷ”ˏ)
(the “ Guidelines for the Full Circulation ”), which was partly revised on August 10, 2023
according to the Decision on Revising and Abolishing Part of Securities and Futures Policy
Documents by CSRC (ٙ
).
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According to the Guidelines for the Full Circulation, shareholders of domestic unlisted
shares may determine by themselves through consultation the amount and proportion of shares,
for which an application will be filed for circulation, provided that the requirements laid down
in the relevant laws and regulations and set out in the policies for state-owned asset
administration, foreign investment and industry regulation are met, and the corresponding
H-share listed company may be entrusted to file the said application for full circulation. To
apply for full circulation, an H-share listed company shall file the application with the CSRC
according to the administrative filing procedures necessary for the Overseas Listing Trial
Measures. After the application for full circulation has been approved by the CSRC, the
H-share listed company shall submit a report on the relevant situation to the CSRC within 15
days after the registration with CSDCC of the shares related to the application has been
completed.
On December 31, 2019, China Securities Depository and Clearing Corporation Limited
(ப΂ʮ̡) (the “ CSDCC ”) and the Shenzhen Stock Exchange ( ଉέᗇ
ה׸the “ SZSE ”) jointly announced the Measures for Implementation of H-share Full
Circulation Business ( Hٰ“ஷ”) (the “ Measures for
Implementation ”). The businesses in relation to the H-share full circulation business, such as
cross-border transfer registration, maintenance of deposit and holding details, transaction
entrustment and instruction transmission, settlement, management of settlement participants,
services of nominal holders, etc. are subject to the Measures for Implementation.
In accordance with the Notice of China Securities Depository and Clearing Co., Ltd
Shenzhen Branch on the Release of China Securities Depository and Clearing Co., Ltd
Shenzhen Branch H-shares “Full Circulation” Business Guidelines ( ʕ਷ഐၑଉέʱʮ̡ᗫ
೯̺<ப΂ʮ̡ଉέʱʮ̡Hٰ“ஷ”) which
was promulgated by CSDC Shenzhen Branch on September 20, 2024 and came into effect on
September 23, 2024, it specified the business preparation, account arrangement, cross-border
share transfer registration and overseas centralized custody, etc. And China Securities
Depository and Clearing (Hong Kong) Co., Ltd also promulgated the Guide to the Program for
Full Circulation of H-shares ( ʕ਷ᗇՎ೮াഐၑ(ಥ)ʮ̡Hٰ“ஷ”)t o
specify the relevant escrow, custody, agent service of China Securities Depository and Clearing
(Hong Kong) Co., Ltd, arrangement for settlement and delivery and other relevant matters.
LA WS AND REGULATIONS OF AUSTRALIA
Legal Framework for Clinical Trials
Clinical trials in Australia are regulated by the Therapeutic Goods Administration
(“TGA”). These trials must adhere to various laws and regulations at both the Commonwealth
and State/Territory levels, including the Therapeutic Goods Act 1989 (Cth) and the Therapeutic
Goods Regulations 1990 (Cth). Additionally, they must comply with the International Council
for Harmonisation of Technical Requirements for Pharmaceuticals for Human Use (ICH)
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Guidelines for Good Clinical Practice (the “ ICH GCP Guidelines ”), as well as the National
Statement on Ethical Conduct in Human Research (the “ National Statement ”). Both the ICH
GCP Guidelines and the National Statement are incorporated by reference in the Therapeutic
Goods Regulations 1990 .
There are two approval pathways for clinical trials in Australia: the Clinical Trial
Notification (“ CTN”) scheme and the Clinical Trial Approval (“ CTA”) scheme. The CTN
scheme involves notifying the TGA about the clinical trial without requiring any evaluation by
the TGA. The CTA scheme necessitates both notification and a comprehensive evaluation and
assessment by the TGA prior to the trial’s initiation. The CTN scheme is typically employed
for early-phase studies where sufficient preclinical safety data is available, while the CTA
scheme is generally reserved for high-risk or novel treatments with limited known safety data.
The choice between these two schemes is primarily determined by the trial sponsor and the
relevant Human Research Ethics Committee (“ HREC ”), although the CTA scheme is
mandatory for certain biological medicines. Approval from the research institute conducting
the trial, following a review by its HREC, is required prior to the commencement of clinical
trials in Australia. HRECs are also tasked with overseeing these trials.
Regarding safety reporting obligations, clinical trials in Australia must adhere to the
“Note for Guidance on Clinical Safety Data Management: Definitions and Standards for
Expedited Reporting” (CPMP/ICH/377/95), as annotated by the TGA, and the National Health
and Medical Research Council (“ NHMRC ”) Guidance on Safety Monitoring and Reporting in
Clinical Trials Involving Therapeutic Goods.
Clinical trials in Australia must have a trial sponsor that is a legal Australian entity. The
Australian trial sponsor is responsible for the initiation, management, and financing (or
arranging financing) of the clinical trial and holds legal responsibility for its conduct. The trial
sponsor does not need to be the manufacturer of the product under investigation. The
manufacturer may rely on the trial results when seeking registration of the product on the
Australian Register of Therapeutic Goods.
Clinical trials in Australia must follow the ICH GCP Guidelines, as annotated by the
TGA. These annotations provide additional guidance on compliance with the National
Statement, informed consent in special circumstances, trial conduct responsibilities (including
management, data handling, and record keeping), and the manufacturing, packaging, labeling,
and coding of investigational products, as well as reporting adverse drug reactions. Approval
of a clinical trial in Australia is contingent upon adherence to the ICH GCP Guidelines as
annotated by the TGA, and compliance with the National Statement is also mandatory. The
National Statement outlines the ethical standards applicable to all human research, including
clinical trials, in Australia.
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Additionally, per the ICH GCP Guidelines as annotated by the TGA, products used in
clinical trial must comply with the applicable good manufacturing practices (“ GMP”). For
investigational products manufactured in Australia, the relevant manufacturing standards are
set out in the Therapeutic Goods (Manufacturing Principles) Determination 2020 (Cth).
Generally, therapeutic goods (other than blood, blood components, haematopoietic progenitor
cells and biologicals that do not comprise or contain live animal cells, tissues or organs) must
be manufactured in accordance with the Guide to Good Manufacturing Practice for Medicinal
Products (PE 009-16, 1 February 2022) published by PIC/S.
Under both the CTN and CTA schemes, the clinical trial sponsor must submit to the TGA
detailed information including the proposed dosage form, route of administration, formulation,
dosage, and frequency of administration of the product prior to the trial’s initiation. Should
there be a proposal to modify the dosage following the completion of a Phase I clinical trial,
such a change must be notified to the TGA (if the trial falls under the CTN scheme) or approved
by the TGA (if the trial falls under the CTA scheme). Any such change will also require review
and approval by the HREC overseeing the trial.
LA WS AND REGULATIONS OF THE UNITED STATES
Laws and Regulations of New Drug Developments
In the U.S., the FDA regulates drugs under the Federal Food, Drug, and Cosmetic Act (the
“FDCA”), its implementing regulations and biologics under the FDCA and the Public Health
Service Act (the “PHSA”) and their implementing regulations. Both drugs and biologics also
are subject to other federal, state and local statutes and regulations, such as those related to
competition. The process of obtaining regulatory approvals and the subsequent compliance
with appropriate federal, state, and local statutes and regulations requires the expenditure of
substantial time and financial resources. Failure to comply with the applicable U.S.
requirements at any time during the product development process, approval process or
following approval may subject an applicant to administrative actions or judicial sanctions.
These actions and sanctions could include, among other actions, the FDA ’s refusal to approve
pending applications, withdrawal of an approval, license revocation, a clinical hold, untitled or
warning letters, voluntary or mandatory product recalls or market withdrawals, product
seizures, total or partial suspension of production or distribution, injunctions, fines, refusals of
government contracts, restitution, disgorgement and civil or criminal fines or penalties.
Once a product candidate is identified for development, it enters preclinical testing, which
includes laboratory evaluations of product chemistry, toxicity, formulation and stability, as
well as animal studies. Preclinical testing is conducted in accordance with the FDA ’s Good
Laboratory Practice regulations. A sponsor of IND must submit the results of the preclinical
testing, manufacturing information, analytical data, the clinical trial protocol, and any
available clinical data or literature to the FDA. The IND automatically becomes effective 30
days after receipt by the FDA, unless the FDA raises concerns or questions and places the trial
on a clinical hold within that 30-day period. The FDA may also impose clinical holds or partial
clinical holds at any time during clinical trials due to safety concerns or non-compliance. An
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IND applicant may proceed with a clinical investigation once the applicant has been notified,
typically through a study may proceed letter with or without non-holding comments, by FDA
that the investigation may proceed or after 30 days if the IND is not placed on clinical hold,
which is an order issued by FDA to the sponsor of an IND application to delay a proposed
clinical investigation or to suspend an ongoing investigation.
All clinical trials, which involve the administration of the investigational product to
humans, must be conducted under the supervision of one or more qualified investigators in
accordance with the Good Clinical Practice regulations, including the requirement that all
research subjects provide informed consent in writing before their participation in any clinical
trial. Further, an Institutional Review Board (“IRB”) must review and approve the plan for any
clinical trial before it commences at any institution, and the IRB must conduct continuing
review and reapprove the study at least annually. Each new clinical protocol and any
amendments to the protocol must be submitted for FDA review, and to the IRBs for approval.
An IRB can suspend or terminate approval of a clinical trial at its institution if the trial is not
being conducted in accordance with the IRB’s requirements or if the product has been
associated with unexpected serious harm to subjects.
Clinical trials generally are conducted in three sequential phases, known as Phase I, Phase
II and Phase III, and may overlap.
 Phase I clinical trials generally involve a small number of healthy volunteers or
disease-affected patients who are initially exposed to a single dose and then multiple
doses of the product candidate. The primary purpose of these clinical trials is to
assess the metabolism, pharmacologic action, side effect, tolerability and safety of
the product candidate.
 Phase II clinical trials involve studies on disease-affected patients to evaluate proof
of concept and/or determine the dose required to produce the desired benefits. At the
same time, safety and further PK and PD information is collected, possible adverse
effects and safety risks are identified and a preliminary evaluation of efficacy is
conducted.
 Phase III clinical trials generally involve a large number of patients at multiple sites
and are designed to provide the data necessary to demonstrate the effectiveness of
the product for its intended use, its safety in use and to establish the overall
benefit/risk relationship of the product and provide an adequate basis for product
labeling.
Progress reports detailing the results of the clinical trials must be submitted at least
annually to the FDA. Safety reports must be submitted to the FDA and the investigators 15
calendar days after the trial sponsor determines that the information qualifies for reporting. The
sponsor also must notify the FDA of any unexpected fatal or life-threatening suspected adverse
reaction as soon as possible but in no case later than 7 calendar days after the sponsor’s initial
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receipt of the information. Sponsors of clinical trials of FDA-regulated products, including
drugs, are required to register and disclose certain clinical trial information, which is publicly
available at www.clinicaltrials.gov .
Concurrent with clinical trials, companies usually complete additional animal studies and
must also finalize a process for manufacturing the product in commercial quantities in
accordance with GMP requirements. The process of obtaining regulatory approvals and
compliance with appropriate federal, state, local and foreign statutes and regulations require
the expenditure of substantial time and financial resources. Failure to comply with the
applicable U.S. requirements may subject an applicant to administrative or judicial sanctions.
Review and Approval Processes
The results of product development, preclinical studies and clinical trials, along with
descriptions of the manufacturing process, analytical tests conducted on the product, proposed
labeling and other relevant information, are submitted to the FDA as part of an NDA or a BLA.
Unless deferred or waived, NDAs or BLAs, or supplements must contain data adequate to
assess the safety and effectiveness of the product for the claimed indications in all relevant
pediatric subpopulations and to support dosing and administration for each pediatric
subpopulation for which the product is safe and effective. The submission of an NDA or a BLA
is subject to the payment of a substantial user fee and an annual prescription drug product
program fee.
Within 60 days of its receipt, the FDA reviews the NDA/BLA to ensure that it is
sufficiently complete for substantive review before it accepts the NDA/BLA for filing. After
accepting the NDA/BLA filing, the FDA begins an in-depth substantive review to determine,
among other things, whether a product is safe and effective for its intended use. The FDA also
evaluates whether the product’s manufacturing is GMP-compliant to assure the product’s
identity, strength, quality and purity. Before approving the NDA/BLA, the FDA typically will
inspect whether the manufacturing processes and facilities are in compliance with GMP
requirements and adequate to assure consistent production of the product within required
specifications. The FDA may refer the NDA/BLA to an advisory committee, a panel of experts,
for review whether the application should be approved and under what conditions and
considers such recommendations when making decisions.
The FDA may refuse to approve the NDA/BLA if the applicable regulatory criteria are not
satisfied or may require additional clinical data or other data and information. The FDA will
issue a complete response letter describing all of the specific deficiencies that the FDA
identified in the NDA/BLA that must be satisfactorily addressed before it can be approved. The
deficiencies identified may be minor, for example, requiring labeling changes, or major, for
example, requiring additional clinical trials. Additionally, the complete response letter may
include recommended actions that the applicant might take to place the application in a
condition for approval. The applicant may either resubmit the NDA/BLA, addressing all of the
deficiencies identified in the letter, or withdraw the application or request an opportunity for
a hearing.
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The regulatory approval may be limited to specific diseases and dosages or the indications
for use may otherwise be limited, which could restrict the commercial value of the product.
Further, the FDA may require that certain contraindications, warnings or precautions be
included in the product labeling. In addition, the FDA may require post-approval studies,
including Phase IV clinical trials, to further assess a product’s safety and effectiveness after
NDA/BLA approval and may require testing and surveillance programs to monitor the safety
of approved products that have been commercialized.
FDA Acceptance of Foreign Clinical Studies
Pursuant to Title 21 of the Code of Federal Regulations (“21 CFR”) 312.120 and 314,
FDA recognizes that sponsors may choose to conduct multinational clinical studies under a
variety of scenarios. Multinational studies may include domestic sites conducted under an IND,
foreign sites conducted under an IND, and/or foreign sites not conducted under an IND. Some
sponsors may even seek to rely solely on foreign clinical data as support for an IND or
application marketing approval in the U.S. An application based solely on foreign clinical data
meeting U.S. criteria for marketing approval may be approved if: (1) the foreign data are
applicable to the U.S. population and U.S. medical practice; (2) the studies have been
performed by clinical investigators of recognized competence; and (3) the data may be
considered valid without the need for an on-site inspection by FDA or, if FDA considers such
an inspection to be necessary, FDA is able to validate the data through an on-site inspection
or other appropriate means. Failure of an application to meet any of these criteria will result
in the application not being approvable based on the foreign data alone. FDA will apply this
policy in a flexible manner according to the nature of the drug and the data being considered.
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INTRODUCTION
Overview
We are an innovative biotech company, with in-house expertise and experience in
structural biology, translational medicine and clinical development. The history of our Group
can be traced back to 2017 when our Company acquired equity interests in Hangzhou Hanx and
Dr. Zhang, our executive Director and Chairman, became a director of Hangzhou Hanx. Since
then, we focus on therapeutic mechanisms that are proven theoretically, where, we believe, we
are able to overcome the scientific and clinical barriers to deliver new and effective medicines,
by utilizing our key expertise in structural biology, translational medicine, and clinical
oncology. This expertise helps us to establish biologic discovery and development platforms to
readily identify drug-like candidate pipelines, which are suitable for targeting various diseases.
As of the Latest Practicable Date, we have developed a pipeline of eight drug candidates
focusing on oncology and two drugs candidates focusing on autoimmune, which were under
clinical or pre-clinical development, including our Core Product, HX009, and two Key
Products, HX044 and HX301. Our pipeline development strategy is based on validated targets
and pathways, supported by unique target biology, translational evidences and clinical
feasibility, as well as on molecules of druggable structure. We position ourselves to deliver
next-generation immuno-oncology treatments such as HX009, HX044 and HX016 to combat
PD-1 resistance, ADC molecules HX111 to treat specific malignancies with precision, and
novel autoimmune treatments, such as BsAbs bifunctional antibody HX035 and HX038.
Guided by our mission and vision, we are committed to exploring the next-generation
immunotherapeutics through discovery, development and commercialization of products for
precision therapies in cancers and autoimmune diseases, aiming at addressing unmet medical
needs in global market, and thus ultimately to help patients around the world.
Business development milestones
The following table illustrates the key milestones of our business and corporate
developments:
Time Milestones
January 2017 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Our Company acquired equity interests in Hangzhou Hanx
Series A Investors invested in Hangzhou Hanx and Beijing
Hanx
September 2017 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118We entered into a partnership collaboration for the
development of HX008
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Time Milestones
December 2017 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118We entered into a partnership collaboration with Traws
Pharma, Inc. (formerly known as Onconova Therapeutics,
Inc.), a company listed on NASDAQ (stock code: TRAW),
for the co-development of HX301
October 2019 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118We enrolled the first patient in clinical study for HX009-
I-01 in Australia
We obtained the HX009 NMPA Umbrella Approval for
clinical trials of HX009, a cancer immunotherapy for the
treatment of a variety of malignancies
June 2020 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118We enrolled the first patient in clinical study for HX009-
I-01 in China
December 2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118We enrolled the first patient in clinical study for HX009-
II-02 in China
July 2022 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118NMPA granted the first conditional marketing approval for
HX008 for the treatment of various solid tumors with
MSI-H/dMMR
October 2022 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118We completed the HX009-I-01 Australia Study
October 2022 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Principal investigator of the HX009-I-01 Australia Study
issued the HX009-I-01 Australia CSR
May 2023 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118We obtained the FDA Approval for Phase Ib/II clinical trial
of HX009 in the U.S.
October 2023 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Series B Investors invested in our Company
June 2024 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Series B+ Investors invested in our Company
August 2024 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118We received clinical trial approval regarding a
combination clinical study protocol for HX301 from
NMPA (i.e., the HX301 NMPA GBM Combination
Approval)
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Time Milestones
September 2024 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118We received clinical trial approval letter for HX044 in
Australia from HREC
We received clinical trial approval regarding a
combination clinical study protocol for HX009 from
NMPA (i.e., the HX009 NMPA BTC Combination
Approval)
December 2024 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118We enrolled the first patient in clinical study for HX044-
I-01 in Australia
January 2025 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118We enrolled the first patient in clinical study for HX009-
II-05 in China
We enrolled the first patient in clinical study for HX301-
II-01 in China
We obtained the NMPA Umbrella Approval for clinical
trials of HX044, an innovative clinical-stage drug for
treatment of various types of advanced solid tumor
malignancies, particularly PD-1-resistant solid tumors
February 2025 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118We received clinical trial approval regarding a
combination clinical study protocol for HX009 from
NMPA (i.e., the HX009 NMPA TNBC Combination
Approval)
CORPORATE DEVELOPMENT
Our Company
The following sets forth the corporate history and shareholding changes of our Company.
Establishment of our Company and early development
Our Company was established as a limited liability company in the PRC on December 19,
2014 with a registered capital of RMB2.5 million. Since its establishment and until 2017, our
Company has no operation and was controlled by Mr. Qiao Peng since its establishment and
until May 2017, and Ms. Luo Fang and Mr. Zhang Junmin since May 2017 and until December
2017, each of whom is a relative of Dr. Zhang. As confirmed by Dr. Zhang, it was the
understanding between Dr. Zhang and each of these individuals that he/she was holding the
equity interest in the Company for and on behalf of Dr. Zhang and shall act on the instruction
of Dr. Zhang in exercising his/her right as a shareholder in the Company. In December 2017,
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Dr. Zhang through CZ Biotechnology (wholly-owned by Dr. Zhang at the relevant time)
acquired the entire equity interests in our Company at nil consideration as the relevant equity
interest of our Company were held by the relevant individuals for and on behalf of Dr. Zhang
and has not been paid up at the time of the transfer. After the completion of the equity transfer,
Mr. Zhang Junmin, brother of each of Dr. Zhang and Mr. Zhang Wanming, subscribed for 1%
equity interests in our Company. Upon completion of the above equity transfer and
subscription, our Company has become an investment holding company for Dr. Zhang and Mr.
Zhang Junmin.
Investment by Series A Investors
In around end of 2022, Dr. Zhang decided to move the headquarter of our Group from
Hangzhou to Wuhan. Therefore, Dr. Zhang decided to use our Company as the holding
company of our Group and conducted a series of group restructuring. On January 1, 2023, our
Company entered into an asset reorganization agreement (the “ Asset Reorganization
Agreement ”) with Series A Investors (which were then shareholders of Hangzhou Hanx),
Hangzhou Ganming Investment Management Partnership (Limited Partnership)* (ҳ
Υྫ
)( “ Hangzhou Ganming ”), Mr. Zhang Junmin, CZ Biotechnology
and Hangzhou Hanx. Pursuant to the Asset Reorganization Agreement, (i) Beijing Lapam
agreed to transfer its 12.5% equity interests in Hangzhou Hanx to our Company at a
consideration of approximately RMB16.51 million, which would be offset by the capital
increase payment to be paid by Beijing Lapam for the subscription of 14.71% equity interests
in our Company; (ii) Hangzhou Hongye Ruiji agreed to transfer its 12.5% equity interests in
Hangzhou Hanx to our Company at a consideration of approximately RMB16.51 million,
which would be offset by the capital increase payment to be paid by Hangzhou Hongye Ruiji
for the subscription of 14.71% equity interests in our Company; (iii) Betta Pharmaceuticals
agreed to transfer its 6.25% equity interests in Hangzhou Hanx to our Company at a
consideration of approximately RMB8.25 million, which would be offset by the capital
increase payment to be paid by Betta Pharmaceuticals for the subscription for 7.35% equity
interests in our Company. The considerations for the above equity transfers were determined
with reference to the appraised value of Hangzhou Hanx of approximately RMB132.05 million
as appraised by an independent valuer.
The above equity transfers in relation to the subscription of equity interests in our
Company have been completed on May 6, 2023 when the equity transfers of our Company have
been registered with the local administration for market regulation. For further details of the
investments by Series A Investors in Hangzhou Hanx and our Company, please refer to the
paragraphs headed “Our major subsidiaries and major shareholding changes — Hangzhou
Hanx” and “Pre-IPO Investments” in this section below.
Furthermore, pursuant to the Asset Reorganization Agreement, (i) Hangzhou Ganming
agreed to transfer its remaining 26.25% equity interests in Hangzhou Hanx to our Company at
a consideration of RMB33.17 million, which is determined with reference to the appraised
value of Hangzhou Hanx of approximately RMB132.05 million as appraised by an independent
valuer; and (ii) Mr. Zhang Junmin agreed to transfer its 1% equity interest in our Company to
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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CZ Biotechnology at a consideration of RMB1. The consideration was agreed between Dr.
Zhang and Mr. Zhang Junmin taking into consideration our Company had no operation at the
time of transfer and Mr. Zhang Junmin was not a shareholder of Hangzhou Hanx. Furthermore,
pursuant to the terms of the Asset Reorganization Agreement, Hanx Biopharmaceutical (HK)
would subscribe for 20% equity interests in our Company for equity interests incentive
purpose, which was completed on May 6, 2023.
Upon completion of the above, the shareholding structure of our Company as of May 6,
2023 was as follows:
Name of shareholder Equity interests
Approximate
percentage of
shareholding
(RMB’ million) (%)
CZ Biotechnology 1 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185.53 50.59
Hanx Biopharmaceuticals (HK) 2 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182.19 20.00
Hangzhou Hongye Ruiji /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181.29 11.76
Beijing Lapam /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181.29 11.76
Betta Pharmaceuticals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.64 5.88
Total: /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810.94 100
Note:
1. CZ Biotechnology was established on September 7, 2017 and was wholly-owned by Dr. Zhang at the
time of establishment. Since January 19, 2021 and up to the Latest Practicable Date, CZ Biotechnology
has been owned as to 99.9% by Dr. Zhang and 0.1% by Mr. Zhang Wanming (which was subsequently
transferred to his spouse, Ms. Luo Fang, on 9 October 2025 pursuant to statutory probate procedures
after the decease of Mr. Zhang Wanming). CZ Biotechnology, Ms. Luo Fang and Dr. Zhang are our
Controlling Shareholders.
2. Hanx Biopharmaceuticals (HK) was incorporated in Hong Kong on April 1, 2022 with limited liability
and is wholly-owned by HanxBio (BVI), a company incorporated in BVI with limited liability on
February 21, 2022, which is one of our Controlling Shareholders.
Investment by Series B Investors in October 2023
On May 6, 2023, Series B Investors (except Hangzhou Taikun), Pacific Essence Limited,
Series A Investors, CZ Biotechnology, Dr. Zhang and our Company entered into a subscription
agreement (the “ Series B Subscription Agreement ”). Pursuant to the Series B Subscription
Agreement, Series B Investors (except Hangzhou Taikun) and Pacific Essence Limited agreed
to subscribe for approximately RMB0.78 million registered capital in our Company at a total
consideration of approximately RMB91.38 million. The consideration was determined with
reference to the agreed valuation of our Group between parties to the Series B Subscription
Agreement. For further details of Series B Investors and their investments in our Company,
please refer to the paragraph headed “Pre-IPO Investments” in this section below.
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As confirmed by our Directors, due to change in its investment plan, Pacific Essence
Limited, Dr. Zhang and our Company entered into a termination agreement on September 6,
2023, pursuant to which Pacific Essence Limited transferred its rights and obligation under the
Series B Subscription Agreement to Hangzhou Taikun. On October 10, 2023, the Series B
Investors, Pacific Essence Limited, CZ Biotechnology, Dr. Zhang, Hanx Biopharmaceuticals
(HK) and our Company entered into a supplemental agreement to the Series B Subscription
Agreement (“ Series B Subscription Supplemental Agreement ”), pursuant to which the
parties to the Series B Subscription Supplemental Agreement agreed the transfer of rights and
obligation of Pacific Essence Limited under the Series B Subscription Agreement to Hangzhou
Taikun at nil consideration.
Upon completion of the investments by Series B Investors on October 13, 2023, the
shareholding structure of our Company was as follows:
Name of shareholder Equity interests
Approximate
percentage of
shareholding
(RMB’ million) (%)
CZ Biotechnology /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185.53 47.22
Hanx Biopharmaceuticals (HK) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182.19 18.67
Hangzhou Hongye Ruiji /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181.29 10.98
Beijing Lapam /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181.29 10.98
Betta Pharmaceuticals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.64 5.49
Wuhan Donggaorensi /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.34 2.92
Hangzhou Taikun /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.26 2.19
Tibet Lapam /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.12 1.02
Lapam Capital /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.06 0.51
Ms. Xiao 1 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.0034 0.03
Total: /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111811.71 100
Note:
1. Mr. Liao and Mr. Zou have entered into nominee shareholding arrangement with Ms. Xiao in May 2023
such that Ms. Xiao would hold (i) approximately 0.0181% equity interests in our Company on behalf
of Mr. Liao; and (ii) approximately 0.0015% equity interests in our Company on behalf of Mr. Zou with
effect from the date when Ms. Xiao becomes a Shareholder. For further details, please refer to the note
under the shareholding chart in the paragraph headed “Corporate Development — Our Company —
Conversion and subsequent share transfer” in this paragraph below.
Investment by Series B+ Investors in June 2024
On June 12, 2024, Hainan Y angtze entered into an equity transfer agreement with Hanx
Biopharmaceuticals (HK), Dr, Zhang, CZ Biotechnology and our Company, pursuant to which
Hanx Biopharmaceuticals (HK) agreed to transfer approximately 0.87% equity interests in our
Company to Hainan Y angtze at a consideration of approximately RMB10.65 million. On June
15, 2024, Y angtze Hong Kong entered into a subscription agreement with Hainan Y angtze,
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Series A Investors, Series B Investors, Hanx Biopharmaceuticals (HK), CZ Biotechnology, Dr.
Zhang and our Company. Pursuant to the subscription agreement, Y angtze Hong Kong agreed
to subscribe for approximately 0.66% equity interests in our Company in an amount of
RMB10.65 million.
Hainan Y angtze and Y angtze Hong Kong are the Series B+ Investors. They are both
members of Genscript Biotech Corporation, a company listed on the Main Board of the Stock
Exchange (stock code: 1548). Upon completion of the equity transfers and subscription on July
16, 2024, Genscript Biotech Corporation owned in aggregate approximately 1.53% equity
interests in our Company through approximately 0.87% and 0.66% equity interests in our
Company held by Hainan Y angtze and Y angtze Hong Kong, respectively. For further details of
the investment by Series B+ Investors, basis of the consideration and background of the Series
B+ Investors, please refer to the paragraph headed “Pre-IPO Investments — Information about
our Pre-IPO Investors” in this section below.
Name of shareholder Equity interests
Approximate
percentage of
shareholding
(RMB’ million) (%)
CZ Biotechnology /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185.53 46.91
Hanx Biopharmaceuticals (HK) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182.08 17.68
Hangzhou Hongye Ruiji /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181.29 10.91
Beijing Lapam /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181.29 10.91
Betta Pharmaceuticals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.64 5.45
Wuhan Donggaorensi /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.34 2.90
Hangzhou Taikun /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.26 2.17
Tibet Lapam /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.12 1.01
Hainan Y angtze /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.10 0.87
Y angtze Hong Kong /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.08 0.66
Lapam Capital /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.06 0.51
Ms. Xiao /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.0034 0.03
Total: /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111811.79 100
Transfer of equity interests to Wuhan Hanx
On September 29, 2024, Hanx Biopharmaceuticals (HK) transferred approximately 2.58%
equity interests in our Company to Wuhan Hanx, a limited partnership established in the PRC
on June 3, 2024 and is our employee shareholding platform, at a consideration of
RMB2,785,594, which is determined with reference to the total exercise prices of the options
granted to the limited partners of Wuhan Hanx pursuant to our stock incentive scheme. For
further details of our stock incentive scheme, please refer to the paragraphs headed “Our
Incentive Scheme” in this section below and “Statutory and General Information — D.
Employee Share Incentive Scheme” in Appendix VI to this prospectus.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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Name of shareholder Equity interests
Approximate
percentage of
shareholding
(RMB’ million) (%)
CZ Biotechnology /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185.53 46.91
Hanx Biopharmaceuticals (HK) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181.78 15.09
Hangzhou Hongye Ruiji /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181.29 10.91
Beijing Lapam /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181.29 10.91
Betta Pharmaceuticals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.64 5.45
Wuhan Donggaorensi /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.34 2.90
Wuhan Hanx /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.30 2.58
Hangzhou Taikun /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.26 2.17
Tibet Lapam /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.12 1.01
Hainan Y angtze /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.10 0.87
Y angtze Hong Kong /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.08 0.66
Lapam Capital /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.06 0.51
Ms. Xiao /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.0034 0.03
Total: /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111811.79 100
Conversion and subsequent share transfer
On November 1, 2024, our Company was converted into a joint stock company with
limited liability. Immediately after the Conversion, our Company had a share capital of
approximately RMB11,789,783 divided into 11,789,783 Shares with a nominal value of RMB1
each. Our Shareholders and their respective shareholding percentages remain unchanged
immediately before and after the Conversion. Upon completion of the Conversion on
November 1, 2024, the shareholding of our Company was as follows:
Before the Conversion After the Conversion
Name of shareholder
Equity
interests
Approximate
percentage of
shareholding
Number of
Unlisted
Shares
Approximate
percentage of
shareholding
(RMB’
million) (%) (%)
CZ Biotechnology /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185.53 46.91 5,530,000 46.91
Hanx Biopharmaceuticals
(HK) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181.78 15.09 1,779,364 15.09
Hangzhou Hongye Ruiji /H1118/H1118/H1118/H11181.29 10.91 1,286,047 10.91
Beijing Lapam /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181.29 10.91 1,286,047 10.91
Betta Pharmaceuticals /H1118/H1118/H1118/H1118/H1118/H11180.64 5.45 643,023 5.45
Wuhan Donggaorensi /H1118/H1118/H1118/H1118/H1118/H1118/H11180.34 2.90 341,606 2.90
Wuhan Hanx /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.30 2.58 304,507 2.58
Hangzhou Taikun /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.26 2.17 256,205 2.17
Tibet Lapam /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.12 1.01 119,562 1.01
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Before the Conversion After the Conversion
Name of shareholder
Equity
interests
Approximate
percentage of
shareholding
Number of
Unlisted
Shares
Approximate
percentage of
shareholding
(RMB’
million) (%) (%)
Hainan Y angtze /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.10 0.87 102,408 0.87
Y angtze Hong Kong /H1118/H1118/H1118/H1118/H1118/H1118/H11180.08 0.66 77,994 0.66
Lapam Capital /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.06 0.51 59,604 0.51
Ms. Xiao /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.0034 0.03 3,416 0.03
Total: /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111811.79 100 11,789,783 100
On October 8, 2024, Ms. Xiao entered into share transfer agreements with Mr. Liao and
Mr. Zou separately, pursuant to which Ms. Xiao transferred: (i) 2,135 Unlisted Shares
(equivalent to RMB2,135 equity interests in our Company before the Conversion) to Mr. Liao;
and (ii) 171 Unlisted Shares (equivalent to RMB171 equity interests in our Company before the
Conversion) to Mr. Zou at nil consideration to unwind the nominee shareholding arrangement
between Ms. Xiao and Mr. Liao and Mr. Zou. Upon completion of the above shares transfer on
November 7, 2024 the shareholding of our Company is as follows:
Name of shareholder
Number of
Unlisted Shares
Approximate
percentage of
shareholding
(%)
CZ Biotechnology /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,530,000 46.91
Hanx Biopharmaceuticals (HK) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,779,364 15.09
Hangzhou Hongye Ruiji /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,286,047 10.91
Beijing Lapam /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,286,047 10.91
Betta Pharmaceuticals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118643,023 5.45
Wuhan Donggaorensi /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118341,606 2.90
Wuhan Hanx /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118304,507 2.58
Hangzhou Taikun /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118256,205 2.17
Tibet Lapam /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118119,562 1.01
Hainan Y angtze /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118102,408 0.87
Y angtze Hong Kong /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111877,994 0.66
Lapam Capital /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111859,604 0.51
Ms. Xiao 1 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,110 0.0094
Mr. Zou 1 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118171 0.0015
Mr. Liao 1/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,135 0.0181
Total: /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111811,789,783 100
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 250 ---
Note:
1. Mr. Liao and Mr. Zou has each entered into a nominee shareholding agreement with Ms. Xiao in May
2023. Pursuant to the nominee shareholding agreements, Ms. Xiao would hold: (i) equity interests in an
amount of RMB2,135 in our Company on behalf of Mr. Liao; and (ii) equity interests in an amount of
approximately RMB171 in our Company on behalf of Mr. Zou with effect from the date when Ms. Xiao
becomes a Shareholder. As confirmed by Ms. Xiao, Mr. Liao and Mr. Zou, there is no dispute between
them in relation to the above nominee shareholding arrangements. Furthermore, as advised by our PRC
Legal Adviser, the above nominee shareholding arrangement have been unwound as of the Latest
Practicable Date and such arrangement did not violate the laws and regulations of the PRC. As
confirmed by Ms. Xiao, Mr. Liao and Mr. Zou, the Shares of Ms. Xiao, Mr. Liao and Mr. Zou in our
Company were funded by their own financial resources and were independent from Wuhan
Donggaorensi, its general partner and its ultimate controller. Furthermore, Wuhan Donggaorensi also
confirmed that it has not imposed any requirement on its employees and former-employees requiring
them to vote unanimously with Wuhan Donggaorensi. Ms. Xiao, Mr. Liao and Mr. Zou also confirmed
that they have exercised their voting rights independent of Wuhan Donggaorensi.
Share Split upon Listing
As approved by our Shareholders’ meeting held on November 15, 2024, the ordinary
Shares of the Company will be split on a one-for-ten basis, and the nominal value of the Shares
will be changed from RMB1 each to RMB0.1 each. Immediately after completion of the
Listing, the registered share capital of the Company will be RMB13,621,883 with 136,218,830
Shares with a nominal value of RMB0.1 each.
As advised by our PRC Legal Adviser, in relation all changes in the registered capital and
equity of our Company, as well as the equity transfer of our Company, (i) they are in
compliance with the provisions of the laws and regulations of the PRC in all material respects;
and (ii) we have obtained the necessary approvals or completed the required filings with the
competent authorities.
Our major subsidiaries and major shareholding changes
The following table sets out the details of our major subsidiaries that are material to us
as of the Latest Practicable Date:
Name
Principal
business scope
Principal
activities
Date of
establishment
Place of
establishment/
incorporation Shareholding
(%)
Hangzhou Hanx /H1118/H1118/H1118/H1118/H1118/H1118Technology development,
provision of
biological products,
biological technology
and medical
technology
consultancy services.
Research and
development
and clinical
trial of
HX009 and
HX301
August 3, 2016 PRC The Company
(85%)
Wuhan
Hanzhong
(15%)
1
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 251 ---
Name
Principal
business scope
Principal
activities
Date of
establishment
Place of
establishment/
incorporation Shareholding
(%)
HanxBio (Australia) /H1118/H1118/H1118Conducting clinical trials
for our Company’s
products in Australia.
Clinical trial of
HX009
October 26,
2018
Australia Hangzhou Hanx
(100%)
Hanx Biopharmaceuticals
(Australia) /H1118/H1118/H1118/H1118/H1118/H1118/H1118
Conducting clinical trials
for the Company’s
products in Australia.
Research and
development
and clinical
trial of
HX044
April 19, 2024 Australia Our Company
(100%)
Note:
1. Wuhan Hanzhong is a company established with limited liability in the PRC on July 15, 2016. To the
best knowledge of our Directors, Wuhan Hanzhong is an investment holding company and has no
business operation as of the Latest Practicable Date. Since its establishment and as of the Latest
Practicable Date, it is owned as to 60% by Mr. Xi, a former employee of our Group, and 40% by Ms.
Xi Jingxuan (ẙ⥳), the daughter of Mr. Xi.
Hangzhou Hanx
Hangzhou Hanx was established in the PRC with limited liability on August 3, 2016.
Wuhan Hanxiong was established on November 19, 2013. At the time of its establishment,
it was owned as to 90% by Mr. Xi and 5% by each of Mr. An Jun (ࠏan ex-employee of
our Company) and Mr. Xi Shengzhou (ψ, a relative of Mr. Xi), respectively. Wuhan
Hanxiong was an investment holding company with no substantial business since its
establishment.
In around 2013, Dr. Zhang initiated the idea for the development of HX008 when he was
working in Waterstone Pharmaceuticals. In December 2013, Waterstone Pharmaceuticals
entered into a co-development agreement with Zhongshan Kangfang for the research and
development of HX008. Dr. Zhang was responsible for leading and supervising the relevant
workstream in Waterstone Pharmaceuticals at the relevant time. However, Waterstone
Pharmaceuticals subsequently decided not to pursue the research and development of HX008
as, to the best knowledge of Dr. Zhang, Waterstone Pharmaceuticals decided to focus on other
research and development pipeline, and terminated the abovementioned co-development
agreement in December 2015. At the relevant time, the screening process of PD-1 monoclonal
antibody inhibitors had commenced and relevant analytical methods and immunological
screening protocols had been established. Seeing the potential in HX008, Dr. Zhang sought to
resume its development through another entity.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 252 ---
In order to reduce the administrative cost and time required for establishing a new
company and as confirmed by Dr. Zhang, Dr. Zhang decided to use Wuhan Hanxiong as a
platform and entity to enter into the relevant co-agreement with Zhongshan Kangfang such that
the research and development of HX008 can continue seamlessly. As such, in January 2016,
Wuhan Hanxiong entered into an agreement with Zhongshan Kangfang under which Zhongshan
Kangfang would continue the research and development of HX008 while Wuhan Hanxiong
would continue to, among others, provide technical guidance, supervise the progress and assess
the results of the research and development of HX008, pay for the relevant expense as required
or incurred by Zhongshan Kangfang, as well as conduct other relevant research and
development work. As confirmed by our Company, save as disclosed above, the founding
shareholders of Wuhan Hanxiong, namely Mr. Xi, Mr. An Jun and Mr. Xi Shengzhou, have no
other relationship with our Shareholders, directors or senior management, or their respective
associates. As confirmed by Dr. Zhang, Dr. Zhang also arranged Ms. Huang Ying ( රᚱ,a n
ex-employee of our Group) and Mr. Zhou Hu (ډan ex-employee of our Group), to be
shareholders of Wuhan Hanxiong and assisted in the initial set up of HX008’s research and
development platform.
To facilitate the Pre-IPO Investments from the Series A Investors, our Company
underwent an internal reorganization comprising the following key steps:
(i) Hangzhou Hanx was established on August 3, 2016 with a registered capital of
RMB10 million and was wholly-owned by Wuhan Hanxiong. At the time of the
establishment of Hangzhou Hanx, Wuhan Hanxiong was owned as to 97% by Mr. Xi,
2% by Ms. Huang Ying and 1% by Mr. Zhou Hu, respectively;
(ii) subsequent to the establishment of Hangzhou Hanx, the relevant rights and
obligations related to the research and development of HX008 were succeeded by
Hangzhou Hanx from Wuhan Hanxiong, after which Wuhan Hanxiong ceased to
have any business operation; and
(iii) on December 27, 2016, our Company (controlled by Dr. Zhang through its relatives,
which was the Shareholders of the Company at the relevant time), Hangzhou
Ganming and Wuhan Hanzhong (controlled by the then shareholders of Wuhan
Hanxiong) agreed to acquire 40%, 38.18% and 21.8% equity interests in Hangzhou
Hanx from Wuhan Hanxiong at a consideration of RMB400,000, RMB400,000 and
RMB200,000, respectively. The consideration was determined with reference to the
then registered capital of Hangzhou Hanx considering its nature of an internal
reorganization. Upon completion of the above equity transfers on January 19, 2017,
Hangzhou Hanx was owned as to 40% by our Company; approximately 38.18% by
Hangzhou Ganming and approximately 21.8% by Wuhan Hanzhong, respectively.
As confirmed by our Directors, at the time when Hangzhou Hanx was acquired by our
Company, Hangzhou Hanx was primarily acting as a platform for the research and development
of HX008 and other than that, Hangzhou Hanx had not conducted any substantial business
operation itself at the relevant time.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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As confirmed by Dr. Zhang, Dr. Zhang did not have any trust, voting arrangements or any
other arrangements or agreements with any parties in written form on the beneficial interest of
Wuhan Hanxiong, Hangzhou Hanx, Hangzhou Ganming and/or the Company since their
respective establishment. Regarding Wuhan Hanxiong and Hangzhou Hanx, Dr. Zhang
confirms that he has been financing the initial setup of Wuhan Hanxiong and Hangzhou Hanx
as a research and development platform of HX008 since 2015 and 2016 respectively,
notwithstanding that he did not hold any equity interest therein during the relevant period as
it was considered that there were solely transitional arrangements primarily to reduce time
required for establishing a new company at that time as a entity was required to enter into the
relevant co-agreement with Zhongshan Kangfang shortly after the termination of the relevant
co-development by Waterstone Pharmaceuticals in December 2015 such that the research and
development of HX008 can continue seamlessly. The amount of fund provided by Dr. Zhang
in the relevant period amounted to RMB5,500,000.
On January 6, 2017, Series A Investors entered into an investment agreement (the
“Hangzhou Hanx Investment Agreement ”) with Wuhan Hanxiong and Hangzhou Hanx.
Pursuant to the terms of the Hangzhou Hanx Investment Agreement, Series A Investors agreed
to subscribe for in aggregate 31.25% equity interests in Hangzhou Hanx at a total consideration
of RMB25 million, where Beijing Lapam would first subscribe for equity interests in Beijing
Hanx and subscribe for the equity interests in Hangzhou Hanx by using the equity interests in
Beijing Hanx held by Beijing Lapam. The consideration was determined with reference to the
agreed valuation of Hangzhou Hanx of approximately RMB55 million at the time prior to the
investments by the Series A Investors, which has taken into account the clinical progress of the
existing R&D pipeline and the newly developed candidate drugs in the pipeline at that time.
The amount of equity interests subscribed for by the Series A Investors was determined with
reference to the agreed valuation between parties to the Hangzhou Hanx Investment
Agreement. In light of the above:
1. on March 30, 2017, (i) Hangzhou Hongye Ruiji subscribed for approximately
RMB1.82 million equity interests (representing approximately 14.29% equity
interests in Hangzhou Hanx at that time) at a consideration of RMB10 million; (ii)
Betta Pharmaceutical subscribed for approximately 7.14% equity interests in
Hangzhou Hanx at a consideration of RMB5 million; and
2. on April 10, 2017, Beijing Lapam subscribed for approximately 33.33% equity
interests in Beijing Hanx at a consideration of RMB10 million. On September 12,
2018, Beijing Lapam withdrew its investment in Beijing Hanx and subscribed for
approximately RMB1.82 million equity interests in Hangzhou Hanx (representing
approximately 12.5% equity interests at that time).
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 254 ---
Beijing Hanx is established in the PRC with limited liability on January 10, 2017. As
confirmed by our Directors, Beijing Hanx has no operation since its establishment. Upon
completion of the above subscriptions on September 12, 2018, the shareholding structure of
Hangzhou Hanx was as follows:
Name of shareholder Equity interests
Approximate
percentage of
shareholding
(RMB’ million) (%)
Our Company 2, 3 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184 27.50
Hangzhou Ganming 1,2 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183.82 26.25
Wuhan Hanzhong 2 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182.18 15
Hangzhou Hongye Ruiji /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181.82 12.5
Beijing Lapam 3 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181.82 12.5
Betta Pharmaceutical /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.91 6.25
Total: /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111814.55 100
Notes:
1. Hangzhou Ganming is a limited partnership established in the PRC on December 15, 2016. It is an
investment holding vehicle. At the time of its acquisition of Hangzhou Hanx in December 2016,
Hangzhou Ganming was owned as to 56.51% by Mr. Zhang Junmin (brother of Dr. Zhang), 28.50% by
Mr. Xi, 8.57% by Ms. Huang Ying, 3.21% by Mr. Zhou Hu, 1.07% by each of Mr. Liu Tianli ( ᄎ˂ᓿ
, an Independent Third Party), Mr. Zhu Wenan ( ϡ˖τ, an Independent Third Party) and Ms. Mo Y achun
(୽ඩ૮, an ex-employee of our Group), respectively. Mr. Xi was the general partner of Hangzhou
Ganming at that time. As confirmed by Dr. Zhang, the registered capital of Hangzhou Ganming
contributed by Mr. Zhang Junmin was provided by Dr. Zhang and therefore, even though there were no
trust, voting arrangements or any other arrangements or agreements in written form between Dr. Zhang
and Mr. Zhang Junmin as such, it was the understanding between Dr. Zhang and Mr. Zhang Junmin that
Mr. Zhang Junmin was holding the relevant equity interest for and on behalf of Dr. Zhang at the relevant
time and shall act on the instruction of Dr. Zhang in exercising his right as a equity holder and limited
partner in Hangzhou Ganming. On November 10, 2017, Hangzhou Ganming held a partners’ meeting
and unanimously agreed to the withdrawal of Ms. Mo Y achun and Mr. Zhang Junmin, as well as the
admission of CZ Biotechnology as a new partner holding a 55.44% partnership interest. On September
25, 2018, Hangzhou Ganming held a partners’ meeting and unanimously resolved that CZ
Biotechnology replaced Mr. Xi as the general partner. The corresponding industrial and commercial
registration was completed on May 23, 2019. Throughout the Track Record Period and as of the Latest
Practicable Date, Hangzhou Ganming has been owned as to approximately 55.44% by CZ
Biotechnology, approximately 28.5% by Mr. Xi, approximately 10.71% by Ms. Huang Ying,
approximately 3.21% by Mr. Zhou Hu and approximately 1.07% by each of Mr. Liu Tianli and Mr. Zhu
Wenan. CZ Biotechnology has been the general partner of Hangzhou Ganming during the Track Record
Period and as of the Latest Practicable Date.
2. Upon completion of the Hangzhou Hanx Investment Agreement, the shareholding of our Company in
Hangzhou Hanx reduced from 40% to approximately 27.5%. In order to maintain control over Hangzhou
Hanx, in 2018, our Company entered into an acting in concert agreement in relation to the management
of Hangzhou Hanx with Wuhan Hanzhong and Hangzhou Ganming. Pursuant to the acting in concert
agreement, Wuhan Hanzhong, our Company and Hangzhou Ganming agreed to act in concert in relation
to the operation of Hangzhou Hanx and shareholders’ actions at the shareholders’ meeting of Hangzhou
Hanx. If they fail to reach a consensus for a certain resolution in the shareholders’ meeting, the one with
the most voting power in Hangzhou Hanx has the final decision-making power. As advised by our PRC
Legal Adviser, as of the Latest Practicable Date, the acting in concert agreement has not been
terminated.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 255 ---
3. Beijing Lapam is a financial investor and has not been involved in the management and business
decision making process of Hangzhou Hanx when it was a shareholder of Hangzhou Hanx from
September 12, 2018 to January 10, 2023 (the “ Relevant Period ”) and that of our Company since it has
become a Shareholder. Pursuant to the entrustment confirmation and undertaking entered into by our
Company, Dr. Zhang (our executive Director and a director of Hangzhou Hanx as appointed by our
Company), Beijing Lapam and Mr. Y u Zhihua (ശ) (a director of Hangzhou Hanx as appointed by
Beijing Lapam) (“ Mr. Yu ”) dated October 21, 2024, it is confirmed that: among others, having
considered (i) our Company and its designated director (being Dr. Zhang) are familiar with the operation
and management of Hangzhou Hanx; (ii) the size of investment in Hangzhou Hanx is not material to
Beijing Lapam; and (iii) Beijing Lapam was only a financial investor in Hangzhou Hanx, in order to
enhance the efficiency in operation, Beijing Lapam had irrevocably entrusted, confirmed and authorized
our Company (through its designated director) to exercise the rights of Beijing Lapam’s designated
director (being Mr. Y u) in the directors meetings of Hangzhou Hanx for the Relevant Period.
Pursuant to the terms of the Asset Reorganization Agreement, (i) Beijing Lapam, Betta
Pharmaceuticals transferred their equity interests in Hangzhou Hanx to our Company on
January 10, 2023; (ii) Hangzhou Ganming transferred its 26.25% equity interests in Hangzhou
Hanx to our Company at a consideration of approximately RMB33.17 million. The relevant
consideration has been settled on March 3, 2025; and (iii) Hangzhou Hongye Ruiji transferred
its 12.5% equity interests in Hangzhou Hanx to our Company on March 13, 2023. Upon
completion of the above transfers on March 13, 2023, Hangzhou Hanx has been owned as to
85% by our Company and 15% by Wuhan Hanzhong since then. For details, please refer to the
paragraph headed “Corporate Development — Investment by Series A Investors” in this section
above.
HanxBio (Australia)
HanxBio (Australia) is a company incorporated in Australia with limited liability on
October 26, 2018. It is the clinical trial platform for HX009 and is responsible for the
HX009-I-01 Australia Study. It has been wholly owned by Hangzhou Hanx since its
incorporation.
Hanx Biopharmaceuticals (Australia)
Hanx Biopharmaceuticals (Australia) is a company incorporated in Australia with limited
liability on April 19, 2024. It is the research and development and clinical trial platform for
HX044. It has been wholly owned by our Company since its incorporation.
DISPOSED SUBSIDIARY
Taizhou Hanzhong
Taizhou Hanzhong, a research and development platform for HX008, was established by
Hangzhou Hanx as its wholly owned subsidiary on November 25, 2016. In December 2017,
Ningbo Houde Yimin Information Technology Co., Ltd. (ʮ̡)
(“Ningbo Houde Yimin ”), the largest shareholder of Lepu and an independent third party,
acquired 38.46% equity interest in Taizhou Hanzhong from Hangzhou Hanx at a consideration
of RMB50 million and further subscribed for RMB2,692,300 registered capital in Taizhou
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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Hanzhong by way of injection of new capital for a consideration of RMB70 million, after
which Taizhou Hanzhong was held by Ningbo Houde Yimin and Hangzhou Hanx as to 60% and
40%, respectively. After this transaction, Taizhou Hanzhong has ceased to be our subsidiary.
In 2019 and 2024, Hangzhou Hanx entered into further equity transfer agreements with
Lepu to transfer its 40% equity interests in Taizhou Hanzhong at a cash consideration of
RMB350 million, and an annual payment of 4.375% of the net sales revenue of HX008 after
its commercialization. The transfer of equity interests in Taizhou Hanzhong to Lepu has been
completed on August 28, 2024. For further details, please refer to the paragraph headed
“Business — Collaboration Agreements — HX008 Equity Transfer Agreements” in this
prospectus.
As advised by our PRC Legal Adviser, the transfer of equity interests in Taizhou
Hanzhong has been properly and legally completed, and all applicable regulatory approvals
have been obtained.
Save as disclosed above, we have not conducted any disposal of subsidiaries during the
Track Record Period and as of the Latest Practicable Date.
ACQUISITIONS DURING THE TRACK RECORD PERIOD
During the Track Record Period and as of the Latest Practicable Date, our Group did not
have any acquisitions or mergers that we consider to be material to us.
OUR INCENTIVE SCHEME
On August 22, 2024, our Company approved the stock incentive plan which includes: (i)
the stock option incentive plan (the “ Stock Option Incentive Plan ”), which comprises options
to subscribe Unlisted Shares granted to the eligible PRC employees (the “ PRC Stock
Options ”) and the eligible foreign and Hong Kong employees (the “ Foreign and Hong Kong
Stock Options ”); and (ii) the restricted share incentive scheme (the “ Restricted Share
Incentive Scheme ”) granted to Dr. Li, our executive Director, and Ms. Zhang, one of our
senior management members.
The Stock Option Incentive Plan
The PRC Stock Options
The PRC Stock Options are options to purchase units of Wuhan Hanx, which is an entity
established as an employee shareholding platform for the purpose of holding the PRC Stock
Options. Wuhan Hanx is a direct Shareholder holding 304,507 Unlisted Shares as of the Latest
Practicable Date (which will become 3,045,070 H Shares upon Listing). All of the PRC Stock
Options have been granted to 24 eligible PRC employees (the “ Eligible PRC Employees ”),
with 25% of the PRC Stock Options granted have been vested to and exercised by each of the
Eligible PRC Employees.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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As of the Latest Practicable Date, Wuhan Hanx is owned as to approximately 75% by CZ
Biotechnology and 25% by the Eligible PRC Employees in the following manner: (i) 17.95%
by Mr. Liu, our executive Director; (ii) 1.73% by Ms. Sun our Supervisor; (iii) 1.39% by Dr.
Ke our Supervisor; (iv) 0.11% by Ms. Chen our Supervisor; and (v) 3.82% by 20 employees
of our Group (approximately 1.08% by Mr. Y ang Tao ( เᏹ), approximately 0.67% by Mr. Peng
Feiyu (ρ), approximately 0.63% by Mr. Wang Shuai (܏approximately 0.58% by Ms.
Lei Juan (ࢇapproximately 0.1% by Ms. Li Jialin ( ҽԳᎌ), approximately 0.07% by each
of Ms. Chen Cen ( ௓Ҋ), Mr. Zhong Ren ( ᒤʠ) and Mr. Xu Jianling ( ஢਄୥), approximately
0.06% by each of Ms. Ren Liping ( ΂஁റ) and Ms. Y u Ting ( Яణ), approximately 0.05% by
each of Mr. Tian Chen ( ͞ೠ) and Ms. Liao Hongxiu (Ӹ), approximately 0.04% by each
of Mr. Mo Y unlong ( ୽ⱃඤ), Ms. Liu Chang ( ᄎ࿫), Ms. Liu Shuang ( ᄎଗ), Ms. Ma Junjiao
(۷ڲMs. Ha Shaohong (ߎMs. Zhang Meng ( ੵ഼) and Ms. Gao Xinbao (ᘒ)
and approximately 0.03% by Mr. Y an Liangbo (ت.))
Dr. Zhang, through CZ Biotechnology which is a general partner of Wuhan Hanx, is able
to exercise the voting rights attached to the Shares held by Wuhan Hanx.
Foreign and Hong Kong Stock Options
The Foreign and Hong Kong Stock Options consist of options to subscribe for shares of
HanxBio (BVI), an investment holding company and the employee shareholding platform for
the Foreign and Hong Kong Stock Option and the Restricted Share Incentive Scheme, granted
to four eligible foreign and Hong Kong employees, namely Dr. Zhang (our Chairman, an
executive Director and one of our Controlling Shareholders), Dr. Li, Ms. Zhang and Mr. Zhang
Hui (our chief financial officer and one of our joint company secretaries).
As of the Latest Practicable Date, all of the Foreign and Hong Kong Stock Options have
been granted to Dr. Zhang, Dr. Li, Ms. Zhang and Mr. Zhang Hui. These Foreign and Hong
Kong Stock Options represent an effective interests of 1,533,407 Unlisted Shares (which will
become 15,334,075 H Shares upon Listing) held by Hanx Biopharmaceuticals (HK), an
investment holding company and a wholly-owned subsidiary of HanxBio (BVI). In relation to
the options granted to Dr. Zhang, 75% of the options have been vested to Dr. Zhang, and Dr.
Zhang has exercised 25% of the options granted. His relevant shares of HanxBio (BVI) are held
by Hanx Biopharmaceuticals, a company indirectly wholly-owned by Dr. Zhang. In relation to
the options granted to Dr. Li and Ms. Zhang, two-third of the options have been vested to each
of Dr. Li and Ms. Zhang, both of them have not exercised such options. In relation to the
options granted to Mr. Zhang Hui, 50% of the options have been vested to Mr. Zhang Hui, and
Mr. Zhang Hui has exercised 25% of the options granted, and the shares of HanxBio (BVI) are
held by himself.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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The Restricted Share Incentive Scheme
The Restricted Share Incentive Scheme comprises restricted shares units of HanxBio
(BVI) granted to Dr. Li and Ms. Zhang, representing an effective interests of 245,956 Unlisted
Shares (which will become 2,459,565 H Shares upon Listing) held by Hanx
Biopharmaceuticals (HK). As of the Latest Practicable Date, all the restricted shares units of
HanxBio (BVI) have been vested to Dr. Li and Ms. Zhang.
As of the Latest Practicable Date, HanxBio (BVI) is owned as to approximately: (i)
81.57% by Hanx Biopharmaceuticals; (ii) 7.68% by Dr. Li; (iii) 6.14% by Ms. Zhang, and (iv)
4.61% by Mr. Zhang Hui. As such, Dr. Zhang, through Hanx Biopharmaceuticals, is able to
exercise the voting rights attached to the Shares held by HanxBio (BVI).
No further share option will be granted under the Stock Option Incentive Plan and no
further restricted shares unit will be granted under the Restricted Share Incentive Scheme after
the Listing. The terms of the Stock Option Incentive Plan and the Restricted Share Incentive
Scheme are not subject to the provisions of Chapter 17 of the Listing Rules.
For further details of the Stock Option Incentive Plan and the Restricted Share Incentive
Scheme of our Company, please refer to the paragraph headed “Statutory and General
Information – D. Employee Share Incentive Scheme” in Appendix VI to this prospectus.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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PRE-IPO INVESTMENTS
The table below summarizes the principal terms of the Pre-IPO Investments:
Investors
Series A Investors Series B Investors Series B+ Investors
Hangzhou
Hongye Ruiji Beijing Lapam
Betta
Pharmaceuticals
Hangzhou
Taikun
Wuhan
Donggaorensi Tibet Lapam
Lapam
Capital Ms. Xiao Mr. Liao Mr. Zou Hainan Y angtze Y angtze Hong Kong
Date of investment
agreement(s) /H1118/H1118/H1118/H1118/H1118/H1118
Hangzhou Hanx Investment Agreement: January 6,
2017
Asset Reorganization Agreement: January 1, 2023
Series B Subscription Agreement: May 6, 2023
Series B Subscription Supplemental Agreement: October 10, 2023
June 12, 2024 June 15, 2024
Approximate amount
of consideration
paid /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
RMB16.51
million
RMB16.51
million
RMB8.25 million RMB30 million RMB40 million RMB14
million
RMB6.98
million
RMB130,000
3 RMB250,000 3 RMB20,000 3 RMB10.65 million RMB10.65 million
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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Investors
Series A Investors Series B Investors Series B+ Investors
Hangzhou
Hongye Ruiji Beijing Lapam
Betta
Pharmaceuticals
Hangzhou
Taikun
Wuhan
Donggaorensi Tibet Lapam
Lapam
Capital Ms. Xiao Mr. Liao Mr. Zou Hainan Y angtze Y angtze Hong Kong
Basis of consideration 4 /H1118/H1118Hangzhou Hanx Investment Agreement: the agreed
valuation of Hangzhou Hanx of approximately
RMB55 million at the time prior to the investments
by the Series A Investors
Asset Reorganization Agreement: the appraised value
of Hangzhou Hanx of approximately RMB132.05
million as appraised by an independent valuer
The appraised value of our Company of approximately RMB1,376 million as approximately by an independent
valuer
This was equity transfer
between Hainan Y angtze and
Hanx Biopharmaceuticals
(HK) and the appraised
value of our Company of
approximately RMB1,218
million, which is agreed
between the parties to the
agreement with reference to
the appraised value of our
Company of approximately
RMB1,615 million as
appraised by an independent
valuer; and taking into
account certain discount to
such appraised value
considering the terms of
such equity transfer was
negotiated between the
parties to the equity transfer
agreement (as compared
with Pre-IPO Investment
involving subscription of
equity interest of the
Company of which the terms
of such investment would
require approvals from
shareholders of the Company
at the relevant time) and to
the best knowledge of the
Company, the need for
cashflow by the transferor at
the relevant time
The appraised value
of our Company of
approximately
RMB1,615 million
as appraised by an
independent valuer
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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Investors
Series A Investors Series B Investors Series B+ Investors
Hangzhou
Hongye Ruiji Beijing Lapam
Betta
Pharmaceuticals
Hangzhou
Taikun
Wuhan
Donggaorensi Tibet Lapam
Lapam
Capital Ms. Xiao Mr. Liao Mr. Zou Hainan Y angtze Y angtze Hong Kong
Date of payment of the
consideration in full /H1118/H1118
Hangzhou Hanx
Investment
Agreement:
March 13,
2017
Asset
Reorganization
Agreement:
May 6, 2023
Hangzhou Hanx
Investment
Agreement:
October 17,
2018
Asset
Reorganization
Agreement:
April 7, 2023
Hangzhou Hanx
Investment
Agreement:
January 23,
2017
Asset
Reorganization
Agreement:
April 7, 2023
October 20,
2023
October 24,
2023
November 8,
2023
November
3, 2023
October 27,
2023
October 27,
2023
October 27,
2023
August 2, 2024 August 21, 2024
Approximate investment
cost per Share (RMB)
1 /H1118
1.28 1.28 1.28 11.71 11.71 11.71 11.71 11.71 11.71 11.71 10.4 13.65
Approximate discount to
the IPO price 2 /H1118/H1118/H1118/H1118/H1118
95.31% 95.31% 95.31% 57.07% 57.07% 57.07% 57.07% 57.07% 57.07% 57.07% 61.87% 49.96%
Approximate shareholding
in our Company upon
Listing (assuming the
Over-allotment Option
is not exercised) /H1118/H1118/H1118/H1118
9.44% 9.44% 4.72% 1.88% 2.51% 0.88% 0.44% 0.01% 0.02% 0.001% 0.75% 0.57%
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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Investors
Series A Investors Series B Investors Series B+ Investors
Hangzhou
Hongye Ruiji Beijing Lapam
Betta
Pharmaceuticals
Hangzhou
Taikun
Wuhan
Donggaorensi Tibet Lapam
Lapam
Capital Ms. Xiao Mr. Liao Mr. Zou Hainan Y angtze Y angtze Hong Kong
Special rights /H1118/H1118/H1118/H1118/H1118/H1118Certain special rights (the “ Special Rights ”), including but not limited to the repurchase right (which were granted to relevant Pre-IPO Investors to request CZ Biotechnology, Dr. Zhang and/or the Company to repurchase
the equity interest in the Company held by them should certain triggering events as set out in the relevant investment agreements occur), anti-diluti on right, profit-sharing right, most-favorable treatment right, director
nomination right and information right, were granted to the Pre-IPO Investors. The Pre-IPO Investors have agreed to terminate their repurchase righ ts with effect from the date of the listing application of our Company.
Furthermore, the Pre-IPO Investors have agreed to terminate other special rights upon Listing. In the event: (i) the application for Listing is withd rawn or rejected by the Stock Exchange; or (ii) the CSRC filing of the
application for Listing is rejected by the CSRC; or (iii) the Company failed to complete the Listing on the Stock Exchange by December 31, 2025 (whichev er earlier), the Special Rights will be resumed automatically.
For the avoidance of doubt, Hangzhou Hongye Ruiji, Beijing Lapam, Mr. Liao and Mr. Zou were not granted any redemption rights in relation to the equity i nterest in the Company and the Company has not assumed any
repurchase obligation.
Lock-up period /H1118/H1118/H1118/H1118/H1118The Shares held by the Pre-IPO Investors are not subject to any lock-up period pursuant to the terms of their Pre-IPO Investments. However, according t o PRC Company Law, the Pre-IPO Investors shall not transfer their
Shares in the Company within one year from the Listing Date.
Net Proceeds from
the Pre-IPO
Investments
5/H1118/H1118/H1118/H1118/H1118/H1118
RMB10 million RMB10 million RMB5 million RMB30 million RMB40 million RMB14
million
USD0.97
million
RMB130,000 RMB250,000 RMB20,000 No proceed was received by
our Company as it was
equity transfer between
Hainan Y angtze and Hanx
Biopharmaceuticals (HK)
RMB9.56 million
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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Investors
Series A Investors Series B Investors Series B+ Investors
Hangzhou
Hongye Ruiji Beijing Lapam
Betta
Pharmaceuticals
Hangzhou
Taikun
Wuhan
Donggaorensi Tibet Lapam
Lapam
Capital Ms. Xiao Mr. Liao Mr. Zou Hainan Y angtze Y angtze Hong Kong
Use of proceeds /H1118/H1118/H1118/H1118/H1118Pursuant to the Hangzhou Hanx Investment
Agreement, all proceeds shall be used for pre-
clinical study application and clinical study of
long-acting PD-1 program, and other drug
development matters, including but not limited to
HX008, as approved by our Board.
Pursuant to the terms of the Series B Subscription Agreement and the Series B Subscription Supplemental
Agreement, unless with prior written consent form Series B Investors, our Company is not allowed to use the
proceeds for purpose other than research and development of core pipeline new drugs.
50% of the consideration
amount in relation to the
equity transfer shall be
utilized towards the
Company for its use with the
timing and manner to be
agreed by Hainan Y angtze
and Hanx
Biopharmaceuticals (HK).
As of the Latest Practicable
Date, Hainan Y angtze and
Hanx Biopharmaceuticals
(HK) have agreed that such
consideration shall be
extended to the Company in
form of a loan with a term
of five years on normal
commercial terms or better.
As advised by our PRC
Legal Adviser, the relevant
equity transfer was
completed and registered on
July 15, 2024 and the
relevant consideration was
settled on August 2, 2024.
The proceeds shall
mainly be used for
HX009 related
research and
production. Unless
with prior written
consent form the
Series B+ Investors,
our Company is not
allowed to use the
proceeds for
purpose other than
research and
development of core
pipeline new drugs.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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Investors
Series A Investors Series B Investors Series B+ Investors
Hangzhou
Hongye Ruiji Beijing Lapam
Betta
Pharmaceuticals
Hangzhou
Taikun
Wuhan
Donggaorensi Tibet Lapam
Lapam
Capital Ms. Xiao Mr. Liao Mr. Zou Hainan Y angtze Y angtze Hong Kong
Strategic benefits to our
Company /H1118/H1118/H1118/H1118/H1118/H1118/H1118
Our Directors are of the view that our Group could benefit from the Pre-IPO Investment as it demonstrated such investor’s confidence in our business op eration and provided our Group with additional capital to fund our
research and development and operation. In addition, the Pre-IPO Investor will strengthen and diversify the Shareholders’ portfolio.
Notes:
1. Cost per Share equals to the approximate amount of total consideration paid by the Pre-IPO Investor divided by the amount of equity interests/numbe r of Shares in issue held
by the Pre-IPO Investor upon completion of the Listing and assuming the Over-allotment Option is not exercised.
2. Calculated on the basis of the Offer Price of HK$30.00, the mid-point of the proposed range of the Offer Price.
3. At the time of the Series B Investment, Ms. Xiao held the equity interests in our Company on behalf of Mr. Liao and Mr. Zou. As of the Latest Practicable D ate, the nominee
shareholding arrangements between Ms. Xiao and each of Mr. Liao and Mr. Zou have been unwound. For further details, please refer to the paragraph heade d “Corporate
Development — Our Company — Conversion and subsequent share transfer” in this section above.
4. The key reasons for the material increase in valuation of our Company are set forth below:
1. the increase in valuation from the time of Hangzhou Hanx Investment Agreement (January 2017) to that at the time of Asset Reorganization Agreement ( January 2023)
in relation to the investments by the Series A Investors was mainly due to: (i) the marketing approval for HX008 was granted by NMPA in 2022 and receipt of payment
in relation to the transfer of HX008; (ii) the completion of the HX009-I-01 Australia Study in October 2022 and the commencement of the HX009-I-01 Chin a Study (Phase
Ia) in May 2020 and HX009-II-02 China Study in December 2021; and (iii) the commencement of HX301-I-01 China Study in September 2020;
2. the increase in valuation from the time of Asset Reorganization Agreement (January 2023) to that of investments by Series B Investors (May 2023) was mainly due to
the grant of the Study May Proceed approval by FDA with non-holding clinical suggestions of HX009 in May 2023; and (ii) receipt of milestone payments in relation
to HX008;
3. the increase in valuation from the time of investments by Series B Investors (May 2023) to that of investments by Series B+ Investors (June 2024) was m ainly due to:
(i) completion of our Phase Ia of the HX009-I-01 China Study in February 2024; (ii) the acceptance of the HX301-II-01 China Study Protocol by the NMPA in May 2024;
and (iii) receipt of milestone payments and royalty fees in relation to HX008; and
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 265 ---
4. the valuation increased from the time of investments by Series B+ Investors (June 2024) to the time of Listing mainly because: For our Core Product HX 009 (i) we have
completed Phase Ia of the HX009-I-01 China Study in July 2024, and are undergoing Phase Ib of the HX009-I-01 China Study; (ii) we commenced the HX009-II -02 China
Study for treatment of R/R lymphoma (including R/R EBV +NHL) in December 2021, and were under the normal observation process as of the Latest Practicable Date
with the expectation to complete this clinical study by 2025; (iii) we commenced the HX009-II-05 China Study in January 2025, which is a Phase IIa combi nation study
with a pivotal trial stage (Stage III) FAKi drug for the treatment of advanced BTC; (iv) we also obtained the NMPA approval in February 2025 for a combina tion study
of HX009 with trastuzumab in patients with advanced triple-negative breast cancer, and we expect the first patient enrollment for this combination s tudy to be in 2026;
for our Key Product HX301, (v) we completed the Phase I clinical study for treatment of advanced solid tumor in July 2024; (vi) we commenced the Phase IIa combination
study for treatment of glioblastoma in January 2025; for our Key Product HX044, (vii) we commence the HX044-I-01 clinical studies in Australia and Chi na in December
2024 and March 2025, respectively. In addition, (viii) we received of milestone payments and royalty fees in relation to HX008; and (ix) there would be premium attached
to the Shares of the Company as they become freely tradeable when our Company becomes a public company.
5. As of the Latest Practicable Date, we have utilized all the net proceeds received from the Pre-IPO Investments for research and developments in acco rdance to the terms of
the respective Pre-IPO Investment agreements.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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Information about our Pre-IPO Investors
Series A Investors
Beijing Lapam /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Beijing Lapam is our sophisticated investor (as defined under
Chapter 2.3 of the Guide for New Listing Applicants issued by the
Stock Exchange) having made meaningful investment in our
Company. It is a limited partnership established in the PRC on
September 9, 2014 and is principally engaged in venture capital
investment, with an investment focus on innovative drugs and
medical devices enterprises. As of September 30, 2024, it has
approximately RMB1.55 billion of assets under management,
representing its investments in our Company and other
biopharmaceutical companies, including but limited to our
Company, Binhui Biopharmaceutical Co., Ltd.* (߅ي
ʮ̡) (a company listed on the NEEQ, stock code:
874271), Beijing Biostar Pharmaceuticals Co., Ltd.* (ʕ˂
ʮ̡) (a company listed on the Stock Exchange,
stock code: 2563) and Beijing Kawin Technol Sha-hld Co Ltd* ( ̏
ʮ̡) (a company listed on the Shanghai
Stock Exchange, stock code: 688687). To the best knowledge of our
Director, the general partner of Beijing Lapam is Beijing Lapam
Investment Management Consulting Center (General Partnership)*
(̏ԯᎲᇂҳ༟၍ଣፔ༔ʕː	౷ஷΥྫ
)( “ Beijing Lapam
Investment”), which owns approximately 1.03% partnership
interest of Beijing Lapam. Among the limited partners of Beijing
Lapam, (i) none of the limited partners holds more than one-third of
the partnership interests in Beijing Lapam; and (ii) all of the limited
partners are Independent Third Parties. Beijing Lapam Investment is
ultimately controlled by Mr. Y u, who is appointed as a director of
Hangzhou Hanx as the board representative of Beijing Lapam, who
is also the executive partner of Beijing Lapam Investment and
controls Beijing Lapam Investment through Tibet Lapam
Management Consulting Center (Limited Partnership)* ( ГᔛᎲᆵ
၍ଣፔ༔ʕː(Υྫ)) (“ Tibet Lapam Management
Consulting Center”). Tibet Lapam Management Consulting Center
is owned as to more than 50% by Mr. Y u through his approximately
48.51% direct interests in Tibet Lapam Management Consulting
Center and approximately 4% interests through Beijing Lapam
Management Consulting Co., Ltd.* (ʮ
̡)*, the general partner of Tibet Lapam Management Consulting
Center and is owned as to approximately 76.47% by Mr. Y u.
Furthermore, Mr. Zhang Junmin also holds 5% equity interests in
Tibet Lapam Management Consulting Center as a limited partner.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 267 ---
Mr. Y u has extensive experience in business management and
investment with a focus on healthcare industry. As of the Latest
Practicable Date, Beijing Lapam Investment had total assets
under management of over RMB10 billion and its investment
portfolio has included companies across biopharmaceutics
sectors, including RemeGen Co., Ltd (Ⴁᖹ(๧̨)΅
ʮ̡) (a company listed on the Stock Exchange, stock code:
9995), CANbridge Pharmaceuticals Inc. (ʮ
̡) (a company listed on the Stock Exchange, stock code: 1228),
Clover Biopharmaceuticals, Ltd. (ʮ̡)
(stock code: 2197) and ImmuneOnco Biopharmaceuticals
(Shanghai) Inc. (ᔼᖹҦஔ(ɪऎ)ʮ̡)( a
company listed on the Stock Exchange, stock code: 1541).
Betta Pharmaceuticals /H1118/H1118/H1118/H1118Betta Pharmaceuticals is a company established in the PRC on
January 7, 2003, listed on the Shenzhen Stock Exchange (stock
code: 300558), and is principally engaged in the production and
sales of medicine. The controlling shareholder of Betta
Pharmaceuticals is Mr. Ding Lieming (׼the chairman of
the board of directors, the general manager and chief executive
officer of Betta Pharmaceuticals, who holds: (i) approximately
0.24% shares of Betta Pharmaceuticals directly; (ii)
approximately 19.13% shares of Betta Pharmaceuticals
indirectly through Ningbo Kaiming Investment Management
Partnership (Limited Partnership)* (௱თҳ༟၍ଣΥྫΆ
Υྫ
), where Mr. Ding Lieming is an executive partner;
and (iii) approximately 2.37% shares of Betta Pharmaceuticals
indirectly through Zhejiang Beicheng Investment Management
Partnership (Limited Partnership)* ( एϪԎϓҳ༟၍ଣΥྫ	Ϟ
Υྫ
), where Mr. Ding Lieming is an executive partner.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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Hangzhou Hongye Ruiji /H1118/H1118Hangzhou Hongye Ruiji is a limited partnership established in the
PRC on May 20, 2016, it is principally a partnership established for
the purpose of investment in our Company. As of December 31,
2024, it had approximately RMB10 million assets under
management, representing the value of Hangzhou Hongye Ruiji’s
investment in our Company. To the best knowledge of our Directors,
it is owned as to: (i) approximately 90.91% by Y anglin Holdings
Limited* (ʮ̡), which is owned as to 90% by Mr.
Lu Guanlin (؍and 10% by Ms. Y ang Ajuan (ࢇڛand (ii)
approximately 9.09% by Hangzhou Hongye Taiji Investment
Management Partnership (Limited Partnership)* (ุइΛҳ
Υྫ
)( “ Hangzhou Hongye Taiji ”).
Hangzhou Hongye Taiji is the general partner of Hangzhou Hongye
Ruiji and is owned as to: (i) 90% by Hangzhou Hongye Investment
Management Co.* (ʮ̡), which is also the
general partner of Hangzhou Hongye Taiji and is wholly owned by
Mr. Zhang Y eyan (ੵุ⇴), brother of Mr. Zhang Y eyan (ف,)
a director of Hangzhou Hanx; and (ii) 10% by Mr. Lu Y ang (ݱ.)
Series B Investors
Wuhan Donggaorensi /H1118/H1118/H1118/H1118/H1118Wuhan Donggaorensi is a limited partnership established in the PRC
on December 28, 2022, and is principally engaged in project and
business investment businesses. Wuhan Donggaorensi is a fund
established for the purpose of investment in our Company. As of
December 31, 2024, it had approximately RMB43 million of assets
under management, representing the value of Wuhan
Donggaorensi’s investment in our Company. To the best knowledge
of our Directors, it is owned as to: (i) approximately 58.14% by
Wuhan Optics V alley Bio-industry Base Construction Investment
Co.* (ʮ̡), which is
indirectly wholly owned by Wuhan East Lake New Technology
Development Zone Management Committee* (ಳอҦஔක
ึ); (ii) approximately 40.70% by Wuhan East Lake
High-Tech Group Co.* (ʮ̡)( “East
Lake Group ”), a company listed on the Shanghai Stock Exchange
(stock code: 600133); and (iii) approximately 1.16% by Wuhan East
Lake High-Tech Equity Investment Management Co. Ltd.* (؇
ʮ̡)( “East Lake Investment ”), which
is wholly owned by East Lake Group. East Lake Investment is the
general partner of Wuhan Donggaorensi. To the best knowledge of
our Directors, Wuhan Donggaorensi is ultimately controlled by the
East Lake Group, and each of Wuhan Donggaorensi and its general
partner and limited partners is an Independent Third Party.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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Hangzhou Taikun /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Hangzhou Taikun is a limited partnership established in the PRC
on August 10, 2021, and is principally engaged in project and
business investment businesses. Hangzhou Taikun is a fund with
an investment focus on innovative drugs and medical devices
enterprises. As of December 31, 2024, it had approximately
RMB6 billion of assets under management, representing its
investments in our Company and other biopharmaceutical
companies, including but limited to Tianjin Minxiang
Biomedical Technology Co., Ltd.* (ࠢ
ʮ̡) (a company listed on the NEEQ, stock code: 834738). To
the best knowledge of our Directors, it is owned as to: (i)
approximately 49% by Hangzhou Tigermed Equity Investment
Partnership (Limited Partnership)* (ᛆҳ༟ΥྫΆ
ุ(Υྫ)) (“ Hangzhou Tigermed Investment ”). Hangzhou
Tigermed Investment is a limited partnership which is
ultimately wholly owned by Hangzhou Tigermed Consulting
Co., Ltd. (ʮ̡)( “ Hangzhou
Tigermed ”), a company listed on the Shenzhen Stock Exchange
(stock code: 300347). Shanghai Tigermed Co., Ltd. (ᔼ
ʮ̡), a wholly owned subsidiary of Hangzhou
Tigermed, is the general partner of Hangzhou Tigermed
Investment; (ii) approximately 25% by Hangzhou High-Tech
V enture Capital Co., Ltd.* (ʮ̡), a
company indirectly wholly owned by Hangzhou High-tech
Industrial Development Zone (Binjiang) Finance Bureau* (ψ
҅); (iii) approximately 25% by Hangzhou
Industrial Investment Co.* (ʮ̡), which is
indirectly wholly owned by State-owned Assets Supervision and
Administration Commission of Hangzhou People’s
Government* (ึ); and
(iv) approximately 1% by Hangzhou Tailong V enture Capital
Partnership (Limited Partnership)* (ψइᘡ௴ุҳ༟ΥྫΆ
Υྫ
), the general partner of Hangzhou Taikun and is
owned as to 99% by Hangzhou Tigermed Investment and 1% by
an Independent Third Party.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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Tibet Lapam /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Tibet Lapam is a limited partnership established in the PRC on
June 2, 2022, and is principally engaged in venture capital
investment. It is a fund with an investment focus on innovative
drugs and medical devices enterprises. As of September 30,
2024, it had an assets under management of approximately
RMB1 billion, representing its investments in our Company and
other private biopharmaceutical companies. Its general partner
is Tibet Ruihan Enterprise Management Consulting Center
(Limited Partnership)* (Υྫ
)
(“Tibet Ruihan ”), which owns approximately 1.01% interests
in Tibet Lapam. Tibet Ruihan is ultimately controlled by Mr. Y u.
To the best knowledge of our Directors, among the limited
partners of Tibet Lapam, (i) none of the limited partners holds
more than one-third of the partnership interest in Tibet Lapam;
(ii) all of the limited partners are independent third parties.
Lapam Capital /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Lapam Capital is a company incorporated in Hong Kong with
limited liability on December 30, 2021, and is principally
engaged in project and business investment businesses. It is a
fund with an investment focus on innovative drugs and medical
devices enterprises. As of December 31, 2024, it had an assets
under management of approximately USD75.8 million,
representing its investments in our Company and other private
biopharmaceutical companies. Lapam Capital is wholly-owned
by Lapam Biotech Fund I, L.P . (“ Lapam Biotech ”), a limited
partnership established in the Cayman Islands on June 7, 2021.
Its general partner is Lapam Capital Management CO., LTD, a
company incorporated in the Cayman Islands on July 7, 2021.
To the best knowledge of our Directors, it is ultimately
controlled by Ms. Sun Hui (ᅆ), the spouse of Mr. Y u. Among
the limited partners of Lapam Biotech, (i) none of the limited
partners holds more than one-third of the partnership interest in
Lapam Biotech; (2) all of the limited partners are independent
third parties.
Ms. Xiao /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Ms. Xiao is our non-executive Director. For further details of
Ms. Xiao, please refer to the paragraph headed “Directors,
Supervisors and Senior Management — Directors — Non-
executive Directors” in this prospectus.
Mr. Liao /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Mr. Liao is an employee of East Lake Investment, and a member
of the investment team responsible for the investment in our
Company.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 271 ---
Mr. Zou /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Mr. Zou is a former employee of East Lake Investment, and a
former member of the investment team responsible for the
investment in our Company.
Series B+ Investors
Hainan Y angtze /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Hainan Y angtze is a company established in the PRC on May 16,
2022 and to the best knowledge of our Directors, it is principally
engaged in pharmaceutical related investment. Hainan Y angtze
is wholly-owned by Y angtze Hong Kong.
Y angtze Hong Kong /H1118/H1118/H1118/H1118/H1118Y angtze Hong Kong is a company incorporated in Hong Kong
with limited liability on February 16, 2017, and to the best
knowledge of our Directors, it is principally engaged in
pharmaceutical related investment. Y angtze Hong Kong is
wholly-owned by Y angzte Holdings (BVI) Limited, a member of
Genscript Biotech Corporation, a company principally engaged
in provision of life-science services and products and listed on
the Main Board of the Stock Exchange (stock code: 1548).
Save as: (i) the Pre-IPO Investments in our Company; (ii) Mr. Y u, the ultimate beneficial
owner of Beijing Lapam and Tibet Lapam, a director of and a board representative of Beijing
Lapam in Hangzhou Hanx an indirect shareholder of Waterstone Pharmaceuticals through
Beijing Lapam (Limited Partnership)* ( ̏ԯᎲᇂ௴ุҳ༟ʕː(Υྫ)) as disclosed in the
paragraph headed “Relationship with our Controlling Shareholders — Our Relationship with
Waterstone Pharmaceuticals” in this prospectus; (iii) Ms. Sun Hui, the ultimate beneficial
owner of Lapam Capital and the spouse of Mr. Y u; and (iv) Mr. Zhang Y eyan (فthe
brother of Mr. Zhang Y eyan ( ੵุ⇴), an ultimate beneficial owner of Hangzhou Hongye Ruiji
and a director of Hangzhou Hanx, to the best knowledge of our Director, all of the Pre-IPO
Investors and their ultimate beneficial owners are Independent Third Parties, and have no
historical and current relationship with the Company and its connected persons and among
each other.
Compliance with Pre-IPO Investment Guidance
The Sole Sponsor confirms that the Pre-IPO Investments are in compliance with Chapter
4.2 of the Guide for New Listing Applicants published by the Stock Exchange, on the basis that
(i) the Listing will take place more than 120 clear days after the completion of the Pre-IPO
Investments, and (ii) no special rights will survive the Listing.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 272 ---
PUBLIC FLOAT
Upon completion of the Global Offering, Share Split and the Conversion of Unlisted
Shares into H Shares (assuming no exercise of the Over-allotment Option), (i) 76,138,710 H
Shares (representing approximately 55.89% of our total issued Shares upon Listing) held by CZ
Biotechnology, Hanx Biopharmaceuticals (HK) and Wuhan Hanx (being our Controlling
Shareholders); (ii) 14,652,130 H Shares (representing approximately 10.76% of our total
issued Shares upon Listing) held by Beijing Lapam, Tibet Lapam and Lapam Capital
(companies controlled by Mr. Y u, a director of and a board representative of Beijing Lapam in
Hangzhou Hanx, or his close associate); and (iii) 11,100 H Shares (representing approximately
0.01% of our total issued Shares upon Listing) held by Ms. Xiao (being our non-executive
Director) will not count towards the public float.
As a result of the foregoing, to the best of our Directors’ knowledge, information and
belief and having made all reasonable inquiries, immediately upon the completion of the
Global Offering, Share Split and the Conversion of Unlisted Shares into H Shares (assuming
no exercise of the Over-allotment Option), an aggregate of 45,416,890 H Shares (including the
issue of 18,321,000 H Shares pursuant to the Global Offering) representing approximately
33.34% of our total issued Shares upon Listing will be counted towards the public float.
Pursuant to Rule 19A.13A(1) of the Listing Rules, where the expected market value at the time
of listing of our Company’s H Shares does not exceed HK$6 billion, at least 25% of the total
number of H Shares must at the time of the Listing be held by the public. Based on the Offer
Price of HK$28.00, HK$30.00 and HK$32.00 per Offer Share (being the low-end, mid-point
and the upper-end of the indicative Offer Price range, respectively), the expected market
capitalization of the Company’s H Shares would not exceed HK$6 billion. As such, our
Directors are of the view that our Company will be able to satisfy the public float requirement
under Rule 19A.13A(1) of the Listing Rules.
FREE FLOAT
Rule 19A.13C of the Listing Rules provides that, where a new applicant is a PRC issuer
with no other listed shares at the time of listing, this will normally mean that the portion of H
shares for which listing is sought that are held by the public and not subject to any disposal
restrictions (whether under contract, the Listing Rules, applicable laws or otherwise), at the
time of listing, must: (a) represent at least 10% of the total number of issued shares in the class
to which H shares belong at the time of listing (excluding treasury shares), with an expected
market value at the time of listing of not less than HK$50,000,000; or (b) have an expected
market value at the time of listing of not less than HK$600,000,000.
Under the applicable PRC laws, all existing Shareholders (including the Pre-IPO
Investors) are subject to statutory restriction on transfer within a period of one year from the
Listing Date. Each of the Cornerstone Investors has agreed to a lock-up period of six months
from the Listing Date. As such, H Shares held by all existing Shareholders and the Cornerstone
investors upon the Listing shall not be counted towards the free float of the H Shares of the
Company at the time of Listing. Based on the Offer Price of HK$28.00, HK$30.00 and
HK$32.00 per Offer Share (being the low-end, mid-point and the upper-end of the indicative
Offer Price range, respectively) the 14,986,600, 15,208,800 and 15,403,200 H Shares to be
issued pursuant to the Global Offering are expected to be held by the public and will not be
subject to any disposal restrictions (whether under contract, the Listing Rules, applicable laws
or otherwise). Based on the low-end, mid-point and the upper-end of the indicative Offer Price
range, respectively, our Company will satisfy the free float requirements under Rule 19A.13C
of the Listing Rules.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 273 ---
SHAREHOLDING STRUCTURE OF OUR COMPANY
Our Company has applied for the Conversion of Unlisted Shares into H Shares, which
involves 11,789,783 Shares held by 15 Shareholders. The table below is a summary of the
shareholding structure of our Company as of the Latest Practicable Date and following the
completion of the Global Offering, Share Split and the Conversion of Unlisted Shares into H
Shares (assuming the Over-allotment Option is not exercised):
Shareholder
As of the
Latest Practicable Date
Upon completion
of the Share Split
Immediately following the completion of the Global Offering, Share Split,
and Conversion of Unlisted Shares into H Shares
(Assuming the Over-allotment Option is not Exercised)
Unlisted Shares Unlisted Shares H Shares Unlisted Shares Total Shares
Number of
Shares
Percentage of
Shareholding
in the
Unlisted
Shares
Number of
Shares
Percentage of
Shareholding
in the
Unlisted
Shares
Number of
Shares
Percentage of
Shareholding
in the
H Shares
Number of
Shares
Percentage of
Shareholding
in the
Unlisted
Shares
Number of
Shares
Percentage of
Shareholding
in the total
issued Shares
(%) (%) (%) (%) (%)
CZ Biotechnology /H1118/H1118/H1118/H11185,530,000 46.91 55,300,000 46.91 55,300,000 40.60 0 0 55,300,000 40.60
Hanx Biopharmaceuticals
(HK) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,779,364 15.09 17,793,640 15.09 17,793,640 13.06 0 0 17,793,640 13.06
Wuhan Hanx /H1118/H1118/H1118/H1118/H1118304,507 2.58 3,045,070 2.58 3,045,070 2.24 0 0 3,045,070 2.24
Hangzhou Hongye Ruiji /H1118/H11181,286,047 10.91 12,860,470 10.91 12,860,470 9.44 0 0 12,860,470 9.44
Beijing Lapam /H1118/H1118/H1118/H1118/H11181,286,047 10.91 12,860,470 10.91 12,860,470 9.44 0 0 12,860,470 9.44
Tibet Lapam /H1118/H1118/H1118/H1118/H1118/H1118119,562 1.01 1,195,620 1.01 1,195,620 0.88 0 0 1,195,620 0.88
Betta Pharmaceuticals /H1118/H1118643,023 5.45 6,430,230 5.45 6,430,230 4.72 0 0 6,430,230 4.72
Wuhan Donggaorensi /H1118/H1118/H1118341,606 2.90 3,416,060 2.90 3,416,060 2.51 0 0 3,416,060 2.51
Hangzhou Taikun /H1118/H1118/H1118/H1118256,205 2.17 2,562,050 2.17 2,562,050 1.88 0 0 2,562,050 1.88
Y angtze Hong Kong /H1118/H1118/H1118180,402 1.53 1,804,020 1.53 1,804,020 1.32 0 0 1,804,020 1.32
Lapam Capital /H1118/H1118/H1118/H1118/H111859,604 0.51 596,040 0.51 596,040 0.44 0 0 596,040 0.44
Ms. Xiao /H1118/H1118/H1118/H1118/H1118/H1118/H11181,110 0.0094 11,100 0.0094 11,100 0.0081 0 0 11,100 0.0081
Mr. Zou /H1118/H1118/H1118/H1118/H1118/H1118/H1118171 0.0015 1,710 0.0015 1,710 0.0013 0 0 1,710 0.0013
Mr. Liao /H1118/H1118/H1118/H1118/H1118/H1118/H11182,135 0.0181 21,350 0.0181 21,350 0.0157 0 0 21,350 0.0157
Public Shareholders /H1118/H1118/H11180000 18,321,000 13.45 0 0 18,321,000 13.45
Total: /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111811,789,783 100 117,897,830 100 136,218,830 100 0 0 136,218,830 100
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 274 ---
OUR STRUCTURE IMMEDIATELY PRIOR TO THE GLOBAL OFFERING
The following chart sets forth our Group’s corporate structure immediately prior to the completion of the Global Offering and the Conversion
of Unlisted Shares into H Shares.
100.00%
100.00%
4.61%81.57%
99.90%
100.00%
0.10%
15.09%
Hanx
Biopharmaceuticals
(HK)
(Note 1)
(HK)
Ms. Luo Fang
(Note 10)
HanxBio (BVI)
(BVI)
Mr. Zhang Hui
46.91%
CZ Biotechnology
(PRC)
2.90%
Wuhan
Donggaorensi
(Note 3)
(PRC)
2.17%
Hangzhou Taikun
(Note 3)
(PRC)
0.51%
Lapam Capital
(HK)
(Note 3)
(HK)
7.68%
Dr. Li
2.58%
Wuhan Hanx
(Note 1)
(PRC)
10.91%
Hangzhou Hongye
Ruiji
(Note 2)
(PRC)
5.45%
Betta
 Pharmaceuticals
(Note 2)
(PRC)
10.91%
Beijing Lapam
(Note 2)
(PRC)
1.01%
Tibet Lapam
(Note 3)
(PRC)
6.14%
Ms. Zhang
Dr. Zhang
Caizhang Vision
(BVI)
Hanx
Biopharmaceuticals
(Cayman)
100.00%
0.66%0.87%
Hainan Yangtze
(Note 5)
(PRC)
Yangtze  Hong Kong
(Note 5)
(HK)
0.0015%
Mr. Zou
(Note 3)
0.0181%
Mr. Liao
(Note 3)
0.0094%
Ms. Xiao
(Note 3)
15.00%
85.00% 100.00% 100.00%
Hangzhou Hanx
(PRC)
HanxAimtech
(HK)
Company
(PRC)
HanxBio Inc.
(Note 7)
(US)
Wuhan Hanzhong
(Note 4)
(PRC)
100.00%
Hanx
Biopharmaceuticals
(Australia)
(Australia)
100.00%100.00%100.00%100.00%
Beijing Hanx
(Note 6)
(PRC)
Wuhan Hanxiong
(Note 9)
(PRC)
HanxBio (Australia)
(Australia)
Hangzhou Hanx (HK)
(Note 8)
(HK)
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 275 ---
Notes:
1. Wuhan Hanx is our employee shareholding platform. For further details, please refer to the paragraph headed “Our Incentive Scheme” in this section above.
2. For further details of the background of Series A Investors, please refer to the paragraph headed “Pre-IPO Investments — Information about our Pre- IPO Investors” in this section
above.
3. For further details of the background of Series B Investors, please refer to the paragraph headed “Pre-IPO Investments — Information about our Pre- IPO Investors” in this section
above.
4. Wuhan Hanzhong is a company established with limited liability in the PRC on July 15, 2016. As of the Latest Practicable Date and to the best knowledge of our Directors,
it has no operation, and is owned as to 60% by Mr. Xi, the former employees of Hangzhou Hanx and 40% by Ms. Xi Jingxuan (ẙ⥳), the daughter of Mr. Xi.
5. For further details of the background of Series B+ Investors, please refer to the paragraph headed “Pre-IPO Investments — Information about our Pre -IPO Investors” in this
section above.
6. Beijing Hanx is established in the PRC with limited liability on January 10, 2017. As confirmed by our Directors, Beijing Hanx has no operation since its establishment.
7. HanxBio Inc. is incorporated in the United States with limited liability on December 13, 2023. As confirmed by our Directors, it has no business oper ation since its incorporation.
8. Hangzhou Hanx (HK) is a company incorporated in Hong Kong with limited liability on February 19, 2024. As confirmed by our directors, it has no busine ss operation since
its incorporation.
9. On October 18, 2018, the then shareholders (namely Mr. Xi, Mr. Zhou Hu and Ms. Huang Ying, which held approximately 97%, 2% and 1% of Wuhan Hanxiong, re spectively)
of Wuhan Hanxiong transferred all their equity interests in Wuhan Hanxiong to Hangzhou Hanx at a consideration of RMB1 million, which was determined w ith reference to
the then registered capital of Wuhan Hanxiong. Wuhan Hanxiong has become a wholly-owned subsidiary of our Group since then. As confirmed by our Compan y, Wuhan
Hanxiong has no business operation at the time of acquisition by Hangzhou Hanx and as of the Latest Practicable Date.
10. On 9 October 2025, 0.1% equity interests in CZ Biotechnology held by Mr. Zhang Wanming was transferred to Mr. Zhang Wanming’s spouse, Ms. Luo Fang pu rsuant to statutory
probate procedures after the decease of Mr. Zhang Wanming.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 276 ---
OUR STRUCTURE IMMEDIATELY FOLLOWING THE GLOBAL OFFERING
The following chart sets forth our Group’s corporate structure immediately after the Global Offering, the Share Split and the Conversion of
Unlisted Shares into H Shares (assuming no exercise of the Over-allotment Option)
100.00%
100.00%
4.61%81.57%
99.90%
100.00%
0.10%
Hanx
Biopharmaceuticals
(HK)
(Note 1)
(HK)
Ms. Luo Fang
(Note 10)
HanxBio (BVI)
(BVI)
Mr. Zhang Hui
40.60% 13.06% 2.24% 9.44% 4.72% 9.44% 0.88% 0.44% 1.88% 2.51% 0.75% 0.57%
CZ Biotechnology
(PRC)
Wuhan
Donggaorensi
(Note 3)
(PRC)
Hangzhou Taikun
(Note 3)
(PRC)
Lapam Capital
(HK)
(Note 3)
(HK)
7.68%
Dr. Li
Wuhan Hanx
(Note 1)
(PRC)
Hangzhou Hongye
Ruiji
(Note 2)
(PRC)
Betta
 Pharmaceuticals
(Note 2)
(PRC)
Beijing Lapam
(Note 2)
(PRC)
Tibet Lapam
(Note 3)
(PRC)
6.14%
Ms. Zhang
Dr. Zhang
Caizhang Vision
(BVI)
Hanx
Biopharmaceuticals
(Cayman)
100.00%
Hainan Yangtze
(Note 5)
(PRC)
Yangtze  Hong Kong
(Note 5)
(HK)
0.0013%
Mr. Zou
(Note 3)
0.0157%
Mr. Liao
(Note 3)
0.0081%
Ms. Xiao
(Note 3)
15.00%
85.00% 100.00% 100.00%
100.00%100.00%100.00%
Hangzhou Hanx
(PRC)
HanxAimtech
(HK)
Beijing Hanx
(Note 6)
(PRC)
Wuhan Hanxiong
(Note 9)
(PRC)
HanxBio (Australia)
(Aus)
Company
(PRC)
HanxBio Inc.
(US)
Wuhan Hanzhong
(Note 4)
(PRC)
100.00%
Hanx
Biopharmaceuticals
(Australia)
(Australia)
13.45%
Public Shareholder
Hangzhou Hanx (HK)
(Note 8)
(HK)
100.00%
Notes:
Please refer to notes 1-9 in the paragraph headed “Our Structure Immediately prior to the Global Offering” in this section above.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 277 ---
OVERVIEW
We are an innovative biotech company, with in-house expertise and experience in
structural biology, translational medicine and clinical development for the development of
next-generation immunotherapeutics. Immunity plays a critical role in almost all aspects of
human physiological functions, as well as the pathogenesis of many human diseases,
particularly in cancers and autoimmune or inflammatory disorders. Interventions of
immunological processes have recently demonstrated to be evidently productive as part of the
treatments of these diseases, and its underlying therapeutic mechanism, immuno-oncology and
immune checkpoint inhibitors in particular, has revolutionized the landscape of cancer
treatment by harnessing the power of the immune system. It represents a promising and
evolving approach to cancer therapies, offering a targeted treatment option with potentially
long-term benefits as compared to conventional treatments. We have been exploring the
therapeutic mechanisms with the focus on immune checkpoint inhibitors, which, we believe,
are fundamental for overcoming the scientific and clinical barriers to deliver new and effective
medicines.
From the therapeutic mechanisms perspective, the majority of the immuno-oncology
therapies approved on the market currently revolve around T cells, such as PD-1, PD-L1 and
CTLA-4 immune checkpoint inhibitors, while others involve different immune cells including
macrophage and natural killer cells. However, these currently approved immune checkpoint
inhibitors therapies faces several limitations. For instance, the PD-1/PD-L1 inhibitors only
yield meaningful responses in a fraction of patients, despite of its efficacy as a proven valuable
treatment option for a wide range of cancers. According to the F&S Report, only about 10%
to 29% of patients across almost all major cancer types can benefit from PD-1/PD-L1
monotherapy treatment as demonstrated from the response rate. Intensive researches have been
carried out to overcome these limitations. The first effort is to identify additional agents
affecting immune checkpoint functions beyond PD-1/PD-L1, including agents targeting
CTLA-4, CD47, LAG-3, TIGIT, CD40 and OX40. However, little progress has been made in
this area as none has been clinically validated by today. CTLA-4 antibody has been adopted as
a cancer therapy, even prior to PD-1, but yet to be broadly used given its high incidence of
dose-limiting irAEs. While CD47 has emerged as an immune checkpoint for both innate and
adaptive immunity targetable for immune checkpoint inhibitors based cancer immunotherapy,
the severe hematological toxicity impedes its clinical development according to the F&S
Report. The second approach involves enhancing the currently approved immune checkpoint
inhibitors to overcome the limitations. For instance, creating bi- or multi-functional antibody
modalities in addition to the PD-1/PD-L1 inhibitions, which can be regarded as “PD-1/PD-L1
plus ” molecules. Recent successful example in the industry has validated such approach,
pointing to a new direction of immune checkpoint inhibitors based immune-oncology therapy
development.
BUSINESS
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--- page 278 ---
We are committed to develop a strong immuno-oncology program since the very
beginning of our Group. During the Track Record Period, we primarily pivoted towards
innovations based on the abovementioned second approach by creating bi- or multi-functional
molecules into our immune-oncology pipeline, including “PD-1 plus ” molecule HX009 (being
our Core Product) and HX016-9; “PD-L1 plus ” molecule HX016-7; and “CTLA-4 plus ”
molecule HX044 (being one of our Key Products). We created these new antibody modalities
by utilizing our proprietary V ersatiBody Platform, an antibody engineering platform that can be
flexibly adapted to create candidate antibody drugs that meet different target biology
requirements for enhancement of efficacy and reduction of toxicity.
Our Core Product, HX009, is the first and only bifunctional anti-PD-1 antibody SIRP /H9251
fusion protein as of the Latest Practicable Date according to the F&S Report. It stands out with
the globally leading position in respect of its clinical trial progress among analogous bispecific
antibody and bifunctional fusion protein products targeting PD-1/PD-L1 and CD47. HX009
was created to enhance the efficacy of PD-1 antibody while address the safety concerns of
CD47-targeting by using specifically designed bispecific molecule targeting two immune
checkpoints (i.e., PD-1 and CD47) simultaneously. We believe that HX009 represents a
substantial advancement in cancer immunotherapy, underscoring our commitment of
overcoming obstacles to optimize patient outcomes and redefine the standard of care in cancer
treatment. Meanwhile, one of our Key Products, HX044, being a novel bifunctional
anti-CTLA-4 antibody SIRP /H9251fusion protein, was created to enhance the CTLA-4-targeting
efficacy, while lowering systemic toxicities associated with both targeting. HX044 also
represents a promising cancer immunotherapy that can compensate that of PD-1 treatment due
to different and complement mechanism of actions.
With our in-depth and unique understanding of the target biology of certain targets and
their association with a variety of malignancies, along with the recent maturation of ADC
technology, we also developed ADC drug candidates for unmet medical needs in oncology by
leveraging our V ersatiBody Platform, creating candidate HX111.
Furthermore, with the recent understanding of molecular pathogenesis of many
autoimmune disorders, new therapies are being developed. Several receptor targets have been
explored for creation of antibody therapy modalities, including OX40, OX40L, IL-4R, IL-17
and CD19. Some of such researches have been extended from original immune-oncology
research and now validated in the clinics. Our Company, while extensively focuses on novel
antibody modalities for immune-oncology, also expanded into exploration of novel antibody
modalities for the treatment of autoimmune diseases, particularly by exploiting novel
OX40-targeting and beyond. With recognition of the potentially central role of OX40 in many
autoimmune diseases, we have also built our own autoimmune therapeutic platform based on
bispecific antibody of OX40-targeting and beyond, the autoRx40 Platform. By using autoRx40
Platform and V ersatiBody Platform together, we have been generating novel autoimmune drug
candidates, including bispecific antibody HX035 and HX038.
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Leveraging our key expertise in structural biology, translational medicine, and clinical
oncology, we are able to establish biologic discovery and development platforms to readily
generate drug candidate pipelines, which allows us to optimize and efficiently execute clinical
development strategy targeting disease indications of unmet medical need. Our pipeline
development strategy is based on validated targets and pathways, supported by unique target
biology, translational evidences and clinical feasibility, as well as on molecules of druggable
structure. We position ourselves to deliver next-generation immuno-oncology treatments such
as HX009, HX044 and HX016 to combat PD-1 resistance, the ADC drug candidates including
HX111 to treat specific malignancies with precision, and novel autoimmune treatments, such
as bispecific antibody HX035 and HX038.
We take into consideration a fast-to-market strategy when selecting indications for our
pipeline products to conduct clinical studies, where effective treatment options are scarce or
limited. Our rationale behind these strategic indication selections is to expedite the regulatory
approval process and facilitate the commercial launch of our products.
Guided by our mission and vision, we are committed to exploring the next-generation
immunotherapeutics through discovery, development and commercialization of products for
precision therapies in cancers and autoimmune diseases, aiming at unmet medical needs in
global market, and thus ultimately to help patients around the world.
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As of the Latest Practicable Date, we have developed a pipeline of a total of 10 drug candidates, including our Core Product, HX009, and two
Key Products, HX044 and HX301 among which, eight drug candidates focusing on oncology and two drug candidates focusing on autoimmune
diseases. As of the Latest Practicable Date, our Core Product and Key Products are under clinical trials in China and Australia. The following chart
summarizes the development status of our pipeline products as of the Latest Practicable Date.
Class of DrugsMoAsProduct Current Indication/
Therapeutic Area  Commercial RightsTreatment Line Preclinical Phase Ia/I Phase III/
Registrational PartnershipUpcoming
MilestonePhase Ib/II NDA/
BLA
small moleculeCSF1R/ARK5/
CDK4/6/FLT-3
Glioblastoma
(combination therapy) Greater China
Clinical Pre-Clinical
Global
Complete Phase Ib clinical
study by the second half of 2026
Complete Phase Ib
clinical study by end of 2025
Complete Phase IIa
clinical study by end of 2028
Complete Phase IIa
clinical study by the third
quarter of 2027
Launch Phase IIa
clinical study in 2026
N/A
N/A
2L+
2L+
1L/2L+
1L
R/R EBV+ NHL
(monotherapy)
Advanced Melanoma
(monotherapy)
Advanced Biliary
Tract Cancer
(combination therapy)
HX009(1)
HX301(2)
Complete preclinical trial
and file IND application
by end of 2026
Advanced solid tumor
malignancies (monotherapy
and combination therapy)
Global
Complete dose escalation
clinical study by the fourth
quarter of 2026
2L+
BsAb GlobalInflammation/autoimmuneHX035 File IND application
by the first quarter of 2026OX40 epitopes N/A
Inflammation/autoimmune GlobalBsAbHX038
Complete preclinical trial by end
of 2026 and file IND application
by the first quarter of 2027
OX40/
Undisclosed target N/A
Global mAb-ADCUndisclosed
target Selected T-L/L+ solid tumorsHX111 To receive IND approval by
the first quarter of 2026N/A
HX044(3)
N/A(5) mAbNKG2A PD-1-resistant solid tumors/
viral infection GlobalHX017 N/A
BsAbPD1/VEGF Solid tumors GlobalHX016-9 N/A
BsAbPD-L1/VEGF Solid tumors GlobalHX016-7 N/A
HX129 Selected T-L/L GlobalmAb-ADCTRBV12 N/A N/A(5)
Co-development
PD-1/SIRPα
CTLA-4/SIRPα
bifunctional
antibody
fusion protein
bifunctional
antibody
fusion protein
 Core Product Key Product
2L+
Advanced Triple-Negative
Breast Cancer
(combination therapy)
Competent Authority
NMPA
NMPA
NMPA
NMPA
NMPA
TGA/NMPA
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Notes:
(1) We obtained from NMPA the clinical trial approval notification (i) for HX009 monotherapy in patients with malignancies in October 2019, (ii) for H X009 in combination with
a pivotal stage drug in patients with advanced solid tumor (including BTC and advanced melanoma) in September 2024, and (iii) for HX009 in combination with trastuzumab
in patients with advanced triple-negative breast cancer in February 2025. As of the Latest Practicable Date, we have completed Phase Ia of the HX009-I -01 China Study, which
is a standalone and conventional Phase I clinical study. We are currently conducting Phase Ib of the HX009-I-01 China Study for the treatment of advanc ed melanoma, the
HX009-II-02 China Study for the treatment of R/R EBV + NHL, and the HX009-II-05 China Study for the treatment of advanced biliary tract cancer, which is a combination
study with a focal adhesion kinase inhibitor (aka. FAKi) drug developed by InxMed Biotech Co., Ltd. (Shanghai)* (Ҧ(ɪऎ)ʮ̡). As of the Latest Practicable
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Date, this FAKi drug was in its pivotal trial stage (Stage III), and HX009 for this study will only be used together with this FAKi drug once it receives th e market authorization
approval. The dotted line represents the exempted stages for these two combination studies of HX009, which was granted as leveraging study results fr om other clinical trial
programs of HX009 (including HX009-I-01 Australia Study and Phase Ia of the HX009-I-01 China Study) and communications with the Competent Authoriti es in this regard.
(2) We obtained from NMPA the clinical trial approval notification for HX301 monotherapy in patients with advanced malignancies in January 2020 and f or HX301 in combination
with temozolomide in patients with glioblastoma in August 2024, respectively. As of the Latest Practicable Date, we have completed Phase I clinical s tudy of the HX301-I-01
China Study. We are currently conducting the Phase IIa clinical study of HX301 in combination with temozolomide (i.e., HX301-II-01 China Study), and have enrolled seven
patients as of the Latest Practicable Date. The dotted line represents the exempted stages for the combination study of HX301, which was granted as lev eraging study results
from other clinical trial programs of HX301 (including HX301-I-01 China Study and Onconova 19-01 phase 1 study conducted in the U.S.) and communicati ons with the
Competent Authorities in this regard.
(3) Pursuant to the relevant laws and regulations in Australia, we submitted our Human Research Ethics Committee (HREC) application for HX044, and ob tained the HREC approval
dated September 10, 2024 for conducting a Phase I/IIa clinical study to evaluate the safety and tolerability of HX044 in the treatment of patients with advanced solid tumors
malignancies (i.e., the HX044-I-01 Australia Study). In addition, we have obtained from NMPA the clinical trial approval notification for HX044 mon otherapy and a combination
study of HX044 with pucotenlimab in patients with advanced solid tumor malignancies in January and September 2025, respectively (i.e., the HX044-I- 01 China Study). The
advanced solid tumor targeted by our product refers to relapsed/refractory solid tumor. As of the Latest Practicable Date, we have enrolled 23 patien ts for the monotherapy part
(with eight patients in Australia and 15 patients in China) and two patients for the combination therapy part, respectively, for the HX044-I-01 studi es.
(4) Prior to the Track Record Period, we co-developed HX008 with Zhongshan Kangfang, which is, a mAb targeting PD-1 with a proven long half-life. Short ly after we obtained
the clinical study approval in August 2017 and through a series of equity transfer agreements entered in between 2017 and 2019, HX008 was transferred t o Lepu for a one-off
cash payment of RMB350.0 million and annual royalty fee of 4.375% of the annual net sales revenue of HX008. In July and September 2022, the NMPA granted c onditional
marketing approval for HX008 for the treatment of MSI-H/dMMR solid tumors and inoperable or metastatic melanoma, respectively. As of the Latest Prac ticable Date, we have
received full payment of the one-off cash payment of RMB350.0 million as the milestone payment, and approximately RMB0.7 million, RMB4.4 million and RMB13.1 million
as the HX008 annual royalty fee for 2022, 2023 and 2024, respectively. For details, please refer to “Business — Collaboration Agreements — HX008 Equit y Transfer
Agreements” in this prospectus.
(5) The pipeline candidates were developed as preclinical candidate compounds. As of the Latest Practicable Date, we have completed the preclinical studies and achieved promising
results for the respective pipeline candidates. We plan to proactively seek collaboration with industry-leading business partners to further deve lop these pipeline candidates.
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 Core Product — HX009
Our Core Product, HX009, is an advancement in immuno-oncology as an innovative
bifunctional anti-PD-1 antibody SIRP /H9251fusion protein, aiming at enhancing PD-1 function and
creating a novel “PD-1 plus ” molecule. HX009 is a cancer immunotherapy designed and
developed by us to treat various malignancies. HX009 enhances T cell activations via
co-targeting of CD8
+ Teff by blocking PD-1 and cis engagement with CD47 on Teff within the
tumor micro-environment via anti-PD-1 antibody and SIRP /H9251extracellular domain (one of the
natural ligand proteins of CD47) on HX009, as well as improves macrophage phagocytosis and
dendritic cell-mediated tumor antigen presentations by blocking the interaction between SIRP /H9251
on tumor-infiltrated macrophage or dendritic cells, and CD47 on tumor cells. With its potential
to achieve solid anti-tumor activity, HX009 also mitigates anemia and thrombocytopenia risk
by reducing off-tumor targeting to CD47 on human red blood cells and platelets via the reduced
binding affinity as well as tumor-targeting caused by high affinity PD-1-driving binding, we
believe that HX009 signifies a new realm of immune checkpoint inhibitors.
We initiated first-in-human clinical trial for HX009 in Australia to evaluate the safety,
tolerability and initial efficacy of HX009 in patients with advanced malignancies, which was
completed in October 2022, and HX009 was well tolerated in all 21 treated subjects as
concluded by the principal investigator. In addition, in October 2019, we obtained the clinical
trial approval notification from NMPA, which allows us to carry out clinical trials in China of
HX009 for malignant tumors including advanced melanoma and R/R EBV
+ NHL. Furthermore,
in April 2023, we filed an IND application with FDA for our phase Ib/II study of HX009 in the
U.S. for treatment of DLBCL, and obtained the FDA Study May Proceed approval in May
2023. In September 2024, NMPA granted us the clinical trial approval for HX009 regarding a
combination clinical study, which is a Phase IIa clinical study protocol for the combination
treatment of HX009 with a pivotal trial stage (Stage III) FAKi drug
1 in patients with advanced
malignant BTC and melanoma. We also obtained the NMPA approval in February 2025 for a
combination study of HX009 with trastuzumab in patients with advanced triple-negative breast
cancer, and we expect the first patient enrollment for this combination study to be in 2026.
As of the Latest Practicable Date, we have completed Phase Ia of the HX009-I-01 China
Study, which is a standalone and conventional phase I study to evaluate the safety and
tolerability of HX009 in patients with advanced solid tumors and to preliminarily measure its
anti-tumor efficacy. We are currently conducting three clinical programs for HX009 in China,
namely, (i) the HX009-I-01 China Study (Phase Ib) for treatment of advanced melanoma, (ii)
the HX009-II-02 China Study (Phase I/II) for treatment of R/R EBV
+ NHL, and (iii) the
HX009-II-05 China Study (Phase IIa) for treatment of advanced biliary tract cancer. We also
obtained the NMPA approval in February 2025 for a combination study of HX009 with
1 The pivotal trial stage (Stage III) FAKi drug used in the HX009-II-05 China Study is a focal adhesion kinase
inhibitor (aka. FAKi) developed by InxMed Biotech Co., Ltd. (Shanghai)* (Ҧ(ɪऎ)ʮ̡). As
of the Latest Practicable Date, this FAKi drug was under its pivotal trial stage (Stage III), and obtain NDA
market approval on our HX009 for the treatment of BTC relies on the successful market development of this
drug.
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trastuzumab in patients with advanced triple-negative breast cancer, and we expect the first
patient enrollment for this combination study to be in 2026. For details about the clinical
studies about our Core Product, please refer to “— Clinical-stage Candidates — Core Product
— HX009” in this prospectus.
HX009’s smooth and promising clinical progression underscores its potential to address
significant unmet medical needs across diverse oncological landscapes, offering promising
market opportunities in several key indications. For example, lymphoma associated with EBV
are often more malignant, with poor prognosis and difficulties in treatment. Traditional
treatments such as chemotherapy and radiotherapy have poor efficacy against the EBV
+
associated lymphoma. Currently, there are no approved drugs for the treatment of EBV + NHL
on the market. EBV + NHL has been found to have co-upregulated PD-L1 and CD47, along with
enhanced tumor immunogenicity, which makes it an ideal or appropriate indication for HX009.
Another example sets within the realm of R/R melanoma, HX009 emerges as a promising
solutions with transformative potential. Despite advancements in melanoma treatment, certain
patients are still experiencing disease relapse or unresponsiveness to existing therapies
(including PD-1 mAbs), highlighting an urgent need for innovative modalities with treatment
efficacy. Researches have implicated that the failure of response to PD-1 mAb may be caused
by the lack of CD47 blocking on Teff within the tumor micro-environment. It is therefore
expected that simultaneous blockade of PD-1 and CD47 by HX009 may enhance anti-tumor
immunity in these immuno-oncology resistant melanomas. According to the F&S Report,
HX009 is the only PD-1/CD47 targeted bispecific antibody/bifunctional fusion protein for
melanoma under clinical study globally as of the Latest Practicable Date. Furthermore, in the
realm of advanced BTC, the demand for effective therapeutic approaches intensifies due to the
complexity and high mortality rates of advanced BTC. By addressing these pressing market
needs with its unique mechanism of action and promising clinical data, HX009 has the
potential to carve a substantial niche in the advanced BTC therapeutics landscape by
combining with other agent of unique MoAs.
 Key Product — HX301
Our Key Product, HX301, represents a significant advancement in cancer therapy as a
multi-targeted kinase inhibitor with a unique kinase inhibition profile. Its mechanism of action
lies in its role as an investigational multi-kinase inhibitor developed to combat various cancers
by targeting critical pathways such as CSF1R, ARK5, FLT-3 and CDK4/6. Notably, HX301
exhibits remarkable potency in inhibiting CSF1R, with subnanomolar IC
50 in vitro . CSF1R
plays a pivotal role in the growth, survival, and polarization of myeloid lineage cells such as
macrophages, and it is often overexpressed in certain cancer cells such as acute myeloid
leukemia, and tumor-associated macrophages including glioma-associated macrophages or
microglial cells that are potentially correlating with poorer cancer prognosis. HX301 holds
promise as a candidate cancer treatment by directly targeting cancer cells, such as acute
myeloid leukemia, or indirectly impacting tumor-associated macrophages.
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In December 2017, we entered into a license, development and commercialization
agreement with Onconova Therapeutics, Inc. (the “ Onconova ”, predecessor of Traws Pharma,
Inc. after a business combination in April 2024) (the “ Onconova Co-development
Agreement ”). Pursuant to the Onconova Co-development Agreement, Onconova grants
Hangzhou Hanx an exclusive, royalty-bearing license, with the right to sublicense, under
Hangzhou Hanx to develop and commercialize narazaciclib (which was further developed and
named as HX301 for our pipeline) within Greater China. Such development and
commercialization rights include all activities relating to research, non-clinical, preclinical and
clinical, toxicology testing, statistical analysis and reporting, preparation and submission of
applications for regulatory approval of the product and all activities directed to the marketing,
promotion, selling or offering for sale of a product for an indication. On the other hand,
Hangzhou Hanx grants Onconova to develop and manufacture narazaciclib outside Greater
China. In addition, Onconova shall pay us certain royalties for sales outside of Greater China.
Currently, Hangzhou Hanx focuses on glioblastoma combination treatment in China in respect
of the development of HX301.
Pre-clinical models and phase I safety and efficacy data demonstrate promising results of
HX301, underscoring its potential as a therapeutic option for various advanced solid tumors.
In January 2020, NMPA issued the clinical trial approval notification for HX301, which allows
us to conduct clinical trials of this product for advanced malignancies in China. In July 2024,
we completed the Phase I clinical study of HX301 under the aforesaid NMPA approval, which
is a phase I, open-label, multi-center study evaluating the safety, tolerability, and initial
efficacy of HX301 in patients with advanced solid tumor. The efficacy results suggest that
some patients achieved stable disease at doses of 80 mg or higher, and the duration of stable
disease may be longer with higher doses, which provides clinical benefit support for
subsequent clinical development, especially for the exploration of combination therapies.
We submitted a phase II clinical study protocol to NMPA for the combination with
temozolomide to evaluate the safety and tolerability of HX301 combined with temozolomide
in the treatment of patients with glioblastoma. In August 2024, NMPA issued the clinical trial
approval notification for HX301, which allows us to conduct clinical trials of HX301 in
combination with temozolomide in the treatment of patients with glioblastoma. We have
enrolled first patient for this combination study (i.e., the HX301-II-01 China Study) in January
2025, and the HX301-II-01 China Study is currently ongoing as of the Latest Practicable Date.
Glioblastoma is a disease resided within brain, containing glioblastoma tumor cells and
blood-originated macrophage and brain-originated microglial cells, which make up tumor
micro-environment and are essential for glioblastoma growth. The central nervous system is
protected by the blood-brain barrier, which strictly regulates the entry of substances. The
existence of the blood-brain barrier excludes the vast majority of cancer therapeutics. HX301’s
capability to penetrate the blood-brain barrier suggests its potential for development as a
treatment for glioblastoma, addressing an area of significant unmet medical need. HX301
targets tumor micro-environment while temozolomide targets glioblastoma tumor cells, making
it a promising treatment for glioblastoma and to be expected to have synergistical
effectiveness. Market opportunities for HX301 as well as its combination with temozolomide
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are particularly compelling in the treatment of glioblastoma. According to the F&S Report, the
market of glioblastoma in China reached RMB1.2 billion in 2024, and the market would
enlarge to RMB3.2 billion and RMB5.4 billion by 2030 and 2035 with the CAGR of 17.9% and
10.7%, respectively. As HX301 progresses through clinical trials and regulatory approvals, it
holds the promise of addressing critical gaps in cancer therapy and improving outcomes for
patients worldwide. We expect to proactively seek collaborations with industry-leading
biopharmaceutical companies to further enhance the development and commercialization
potential of HX301, leveraging synergies and expertise to advance clinical research and
accelerate the delivery of innovative therapies to patients in need.
 Key Product — HX044
HX044 is a Key Product developed by our Group currently at clinical stage. It is an
innovative clinical-stage drug for treatment of various types of malignancies, particularly
PD-1-resistant solid tumors, including but not limited to NSCLC, melanoma, renal cell
carcinoma, and gastrointestinal cancer. HX044 is a bifunctional anti-CTLA-4 antibody SIRP /H9251
fusion protein, with intention to create a “CTLA-4 plus ” molecule with increased therapeutic
window.
HX044 was created in-house, and we have global rights for development and
commercialization. It was engineered to significantly reduce affinity for both single targeting
of CTLA-4 and CD47, so that it can minimize irAEs and hematological toxicity that resulted
from both single bindings in peripheral blood but much higher affinity to tumor cells. On the
other hand, as clearly demonstrated in the preclinical models, HX044 efficiently binds to Treg
where co-high-expression of both targets occur, resulting in depletion of Treg as well as
remodeling of tumor micro-environment significantly in favor of anti-tumor immunity as
compared with anti-CTLA-4 mAbs. Therefore, HX044 has broadened therapeutic window.
Pursuant to the relevant laws and regulations in Australia, we obtained the HREC
approval and relevant site ethics committee approval in September 2024. We launched the
Phase I/IIa clinical study to evaluate the safety and tolerability of HX044 in the treatment of
patients with advanced solid tumor malignancies in Australia, with first patient enrolled in
December 2024. As of the Latest Practicable Date, we have enrolled eight patients for the
HX044-I-01 Australia Study. In addition, we have obtained from NMPA the clinical trial
approval notification for HX044 monotherapy and a combination study of HX044 with
pucotenlimab in patients with advanced solid tumor malignancies in January and September
2025, respectively (i.e., the HX044-I-01 China Study). The advanced solid tumor targeted by
our product refers to relapsed/refractory solid tumor. As of the Latest Practicable Date, we have
enrolled 15 patients for the monotherapy part and two patients for the combination therapy
part, respectively, for the HX044-I-01 China Study. According to the F&S Report, HX044 is
the only CTLA-4/SIRP /H9251bispecific antibody/bifunctional fusion protein under clinical study
globally as of the Latest Practicable Date.
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 Commercialized Product — HX008
HX008 is a humanized antagonist mAb against human PD-1 by using human IgG4
isotype, which can inhibit the PD-1 signal to restore the capability of the immune cells to kill
cancer cells through blocking PD-1 binding to their ligands PD-L1 and PD-L2. It innovatively
employs antibody engineering techniques to introduce mutations into Fc portion, thereby
significantly improving its half-life and leads to strong clinical anti-tumor activity and a
favorable safety and efficacy profile.
We co-developed HX008 with Zhongshan Kangfang prior to the Track Record Period.
Shortly after we obtained the clinical study approval in August 2017 and through a series of
equity transfer agreements entered in between 2017 and 2019, HX008 was transferred to Lepu
for a one-off cash payment of RMB350.0 million and annual royalty fee of 4.375% of the
annual net sales revenue of HX008. In July and September 2022, the NMPA granted
conditional marketing approval for HX008 for the treatment of MSI-H/dMMR solid tumors and
inoperable or metastatic melanoma, respectively. As of the Latest Practicable Date, we have
received full payment of the one-off cash payment of RMB350.0 million. Benefitted from the
successful commercialization of HX008, we received payment of approximately RMB0.7
million, RMB4.4 million and RMB13.1 million as the HX008 annual royalty fee as of the
Latest Practicable Date in accordance with its net sales revenues recorded in 2022, 2023 and
2024, respectively. For details, please refer to “— Collaboration Agreements — HX008 Equity
Transfer Agreements” in this prospectus.
 Important Preclinical Stage Products
Immuno-oncology Treatments
HX017 : a monoclonal antibody targeting human NKG2A/CD94, a heterodimer inhibitory
receptor expressed on human natural killer cells and tumor infiltrated CD8
+ cytotoxic
lymphocytes. HX017 can efficiently block the interaction between NKG2A/CD94 and its
ligand human leukocyte antigen-E, a non-classical MHC-I molecule whose expression is often
upregulated by tumors to avoid immune surveillance. HX017 as an immune checkpoint
inhibitor promotes the tumor cytotoxicity of both natural killer cells and CD8
+ cytotoxic
lymphocytes.
HX016-9 : a novel bispecific antibody targeting PD-1 and VEGF, designed to be another
“PD-1 plus ” agent. It was built on HX008, an approved PD-1 monoclonal antibody and our
HX006, a novel VEGF monoclonal antibody with higher activity than Avastin. HX016-9
intends to be a differentiated agent in the market for the indications where PD-1 antibody have
been used. As of the Latest Practicable Date, we have decided the PCC molecule for HX016-9,
and it was in the process of GMP manufacture followed by GLP-enabling studies. We expect
to complete the preclinical trial and file the IND application for HX016-9 by the end of 2026.
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HX016-7 : a novel bispecific antibody targeting PD-L1 and VEGF, designed to be a
“PD-L1 plus ” agent. It was built on an approved PD-L1 monoclonal antibody and our HX006,
a novel VEGF monoclonal antibody with higher activity than Avastin. HX016-7 intends to be
a differentiated agent in the market for the indications where PD-L1 antibody have been used.
As of the Latest Practicable Date, we have decided the PCC molecule for HX016-7, and it was
in the process of GMP manufacture followed by GLP-enabling studies. We expect to complete
the preclinical trial and file the IND application for HX016-7 by the end of 2026.
ADC
HX111: an antibody-drug conjugate designed to specifically target subclasses
lymphoma/leukemia including nearly all A TL, AITL, NK/T and histiocytic lymphoma, as well
as certain solid tumors including sarcoma and HNSCC, which express target receptor and are
expected to be in unmet medical needs. There is little expression of the receptors among
normal tissues, including normal blood cells. As of the Latest Practicable Date, we have
completed the preclinical studies of HX111 and submitted the IND application of a Phase I/IIa
clinical study of HX111 to NMPA in October 2025. We expect to obtain the clinical study
approval in the first quarter of 2026.
HX129 : an antibody-drug conjugate specifically targeting to TRBV12, which constitute
polymorphism with more than 30 families. A given T cell-derived lymphoma/leukemia
expresses a defined TRBV . The antibody of HX129 only recognizes a specific TRBV and
efficiently deplete lymphoma/leukemia of this specific subtype of TRBV . HX129 causes little
toxicity to normal T cells of other TRBV subtypes, thus limiting its toxicity. Therefore, HX129
is expected to be a safe T cell targeting therapy to address unmet clinical needs.
Autoimmune Treatments
HX035 : a BsAb targeting OX40. It blocks OX40L binding to OX40 and induces
significantly stronger ADCC activity, so it can be a strong depleting antibody for the
autoimmune disease cells. It shows strong anti-GvHD activity in the human PBMC induced
acute GvHD model in vivo . We also own the global intellectual property right of HX035. We
expect to complete the preclinical trial by the end of 2025 and file the IND application for
HX035 by the first quarter of 2026.
HX038 : a novel fully humanized BsAb binding to OX40 and an undisclosed receptor
target X with high affinity. Receptor X is also a known target for autoimmune disease. HX038
elicits significantly strong ADCC activity in OX40
+/Receptor X + double positive cells in vitro ,
and an ADCC-enhancing version is being generated. We expect HX038 to be a novel drug
candidate with broader disease indications than HX035 or other OX40-single-targeting agents
in the market due to additional targeting functions. We own the global intellectual property
right of HX038. As of the Latest Practicable Date, we have decided the PCC molecule for
HX038, and we expect to complete the preclinical trial by the end of 2026 and file the IND
application for HX038 by the first quarter of 2027.
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Our research and development capabilities lie in the synergy between our exceptional
structural biology and translational medicine teams, led by our chairman, Dr. Zhang and our
CSO and CEO Dr. Li, respectively. Under Dr. Zhang’s guidance, our antibody discovery team
focuses on engineering antibody molecules with druggable structures and targeting efficacy,
aiming to innovate next-generation therapeutics with enhanced safety and efficacy profiles. For
instance, prior to the Track Record Period, we developed HX008, which was meticulously
designed to recognize a glycosylated epitope on PD-1, representing innovative molecular
design principles that extend its protein half-life, yielding favorable efficacy results while
maintaining a high safety profile. Our Core Product HX009, harnesses the basic structure of
HX008 and integrates an engineered SIRP /H9251domain with weakened binding affinity to
overcome challenges faced by CD47-targeted drugs, such as blood toxicity and antigen sink,
illustrating our commitment to overcoming therapeutic hurdles through cutting-edge design.
Synergizing with our structural biology efforts, our translational medicine team,
spearheaded by Dr. Li, enjoys a wealth of experience in translational research and a track
record of successful drug efficacy studies approved by the FDA. Drawing upon the diverse
expertise in biological, medical, and clinical domains of our leading research and development
team members, we strategically identify unmet medical needs and select suitable indications to
optimize the performance of molecules designed by our structural biology team. Leveraging
translational insights, we strategically focus our clinical development efforts on indications
such as advanced melanoma and R/R EBV
+ NHL for HX009 and glioblastoma for HX301,
aligning our efforts with areas of unmet need to maximize therapeutic impact. Furthermore, the
efficiency and synergy within our discovery and development processes are evidenced by a
variety of data and publications, including conference presentations, abstracts, posters and
manuscripts. These publications highlight the significant strides made by our teams in
advancing novel therapeutics, such as HX009, which demonstrates potent anti-lymphoma
activity in preclinical models, and HX301, a multi-kinase inhibitor exhibiting strong
anti-glioma and acute myeloid leukemia activity in defined preclinical models. Through the
collective expertise of our teams and our commitment to innovation, we continue to push the
boundaries of therapeutic discovery, with a focus on delivering impactful treatments to patients
in need.
During the Track Record Period, we also developed and further enhanced our V ersatiBody
Platform. The traditional approach to develop biologic drugs based on multi-specific
antibodies (including BsAb) typically involves establishing fixed structural platforms engaging
two or more targets, which may solve heavy or light chain mispairing problems and structure
instability, and support biology of a defined pair of targets. However, with the emergence of
diverse BsAb therapeutics in discovery and development, it has become evident that such
platforms are unlikely to be sufficiently robust for supporting variety of target biology and thus
druggability of varying BsAb molecules. Therefore, our V ersatiBody Platform focuses on
diversifying BsAb forms, which allows for flexibility and variability in molecular design, and
it is capable to optimize druggability of newly engineered molecules and support diverse pairs
of targets in order to achieve desired therapeutic efficacy and safety profiles. This approach
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enables us to leverage a range of bispecific antibody technologies to construct adaptable and
stable molecular forms, facilitating the identification of the most effective target pairings and
molecular configurations to maximize therapeutic outcomes, which underscores our dedication
to advancing BsAb therapeutics.
Furthermore, our Group is developing a unique therapeutic platform, the autoRx40
Platform, to target the OX40 receptor and beyond, where OX40 plays a pivotal role in the
pathogenesis of various autoimmune and inflammatory diseases. Our autoRx40 Platform
develops a range of drug candidates that modulate the OX40 pathway, including HX035, an
OX40 epitope bispecific antibody that enhances ADCC activity and demonstrates robust
depletion of OX40
+ cells, as well as antagonist effect; and HX038, an OX40/Target-X
bispecific antibody with potential implications due to its dual targeting capability. These
pipeline products developed through our autoRx40 Platform have shown promising results in
preclinical models, highlighting its potential to address the unmet medical needs in
autoimmune disease treatment.
As of the Latest Practicable Date, our intellectual property portfolio includes six
registered patents and more than 12 pending patent applications. These patents and patent
applications reflect our ongoing innovation and commitment to protecting our proprietary
technologies and advancements in bispecific antibody development. By securing intellectual
property rights, we safeguard our investments in research and development, ensuring that our
innovative approaches and novel therapeutic solutions remain protected in the competitive
landscape of biopharmaceuticals.
We are led by a seasoned management team with significant research and development
experience and a proven track record. Our chairman and executive Director, Dr. Zhang, is a
veteran professional in research and development, clinical development, product launch and
business operations, with over 30 years of experience in the pharmaceutical industry. Our CEO
and CSO, Dr. Li, has approximately 20 years of experience in biotech and CRO, including
discovery and development of biologics and small molecules in oncology and viral infections.
Our CMO and vice general manager, Ms. Zhang, has over 23 years of clinical development
experience in global pharmaceutical companies with track record of multiple product market
approvals. Overall, our management team has extensive industry experience in biologics
development and business management, including antibody discovery and engineering, process
development, clinical operations and regulatory affairs. Their vision and insights are also key
drivers of our success.
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OUR STRENGTHS
The Only Bifunctional Anti-PD-1 Antibody SIRP /H9251Fusion Protein in Clinical
Development, an Innovative PD-1 Plus Therapy
As a biotech company leading in immune-oncology treatment, we are committed to
developing our Core Product, HX009, a pioneering bifunctional anti-PD-1 antibody SIRP /H9251
fusion protein. HX009 represents a substantial leap forward in our mission to develop
innovative immune therapies that address critical unmet medical needs. At the heart of
HX009’s design is its unique structure that targets both PD-1 and CD47. This novel mechanism
of action holds immense potential in opening up new therapeutic possibilities for patients
facing challenging diseases.
The key achievement of HX009 involves its capability to enhance the existing immune
checkpoint inhibitors due to its bifunctional structure of PD-1 and CD47 to create a “PD-1
plus ” modality, so as to overcome the limitations of the existing PD-1 treatment. Dual targeting
of these two checkpoints (i.e., PD-1 and CD47) on Teff can be efficient cis-binding and
synergistic with regard to their activation, and relative cell surface expression levels can be
exploited to enhance cell binding selectivity through the adjustment of binding arm affinities.
Leveraging cis-binding mechanism, HX009 is able to enhance T cell activations via
co-targeting of CD8
+ Teff by blocking PD-1 and cis-engagement with CD47 on Teffs within the
tumor micro-environment via anti-PD-1 antibody and SIRP /H9251extracellular domain. In addition,
with the high affinity of PD-1 to bind with tumor-infiltrated T cells and bring in HX009 in the
tumor microenvironment, HX009 also possesses the potential to improve macrophage
phagocytosis and dendritic cell-mediated tumor antigen presentations by blocking the
interaction between SIRP /H9251on tumor-infiltrated macrophage/dendritic cell and CD47 on tumor
cells.
Another achievement of HX009 lies in its ability to overcome longstanding clinical
challenges associated with CD47-targeted drugs. Through rigorous research and development
efforts, we have engineered HX009 to minimize toxicity concerns often encountered with
anti-CD47 monoclonal antibodies. Particularly, benefitting from its considerably reduced
CD47 binding affinity, HX009 demonstrates a lower risk of hematological toxicity and antigen
sink, which addresses significant hurdles in the development of effective therapies targeting
CD47. By tackling these challenges head-on, we are paving the way for safer and more
efficacious treatments for patients.
Our dedication to advancing HX009 is underscored by its remarkable clinical progress in
global studies. With the first and only clinical development timeline among bispecific
antibodies and bifunctional fusion proteins targeting PD-1/CD47 worldwide, HX009 is at the
forefront of innovation in the field. Preclinical studies have shown HX009 to be with
significant potential to deliver superior therapeutic outcomes in clinics. Moreover, clinical data
has proven it is safe and well tolerated in clinical settings cross several studies. Promising
efficacy signals have also been observed in both solid tumor and hematological malignancies
which are being investigated in further clinical studies.
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We are anticipating future pivotal stage studies in solid tumor and lymphoma, either as
single agent or in combinations with other agents that will further evaluate the therapeutic
potential of HX009. These studies will be instrumental in shaping the future trajectory of
HX009 and its accessibility to patients in need. As we continue to advance HX009 through
clinical development, we are driven by our commitment to enhancing patient outcomes and
catalyzing positive change in healthcare. The market demand for innovative therapies like
HX009 reinforces our steadfast dedication to push the frontiers of medical advancement and
actualize transformative treatments to fruition.
Bringing Industry-Leading Expertise in Translational Medicine to Forge a Strong
Product Pipeline Addressing Unmet Medical Need
At the heart of our drug development strategy lies our industry-leading proficiency in
translational medicine, steered by the visionary leadership of our CSO, Dr. Li. With over a
decade of experience in translational research in a leading preclinical CRO, including
significant contributions to FDA-approved oncology drug efficacy studies, Dr. Li brings
invaluable expertise to our team. Under his guidance, our translational medicine team
comprises experts with diverse backgrounds, encompassing biology, medicine and clinical
research, ensuring a multifaceted approach to addressing unmet medical needs. This collective
wealth of expertise enables us to pinpoint promising target with patient population, smoothen
clinical development and optimize the therapeutic efficacy of our molecules through rigorous
preclinical and translational researches.
For example, in the case of our Core Product HX009, our translational efforts have led
us to prioritize indications such as R/R EBV
+ NHL and advanced melanoma, leveraging the
distinct mechanism of dual PD-1 and CD47 targeting within tumor micro-environment.
Specifically, EBV
+ NHL has been found to have co-upregulated PD-L1 and CD47, along with
enhanced tumor immunogenicity, ideally targeted by HX009; and recent report indicated dual
targeting PD-1 and CD47 on Teffs within tumor micro-environment plays crucial role in
enhanced and sustained anti-tumor immunity in melanoma. In addition, the strategic selection
of advanced biliary tract cancer for HX009 underscores our commitment to addressing areas
of critical unmet medical need. Patients with advanced biliary tract cancer have a very poor
prognosis, and the mortality rate is very high. It is a type of highly fibrotic cancer that can be
treated with HX009 in combination anti-fibrotic drugs (such as FAKi inhibitor), which enables
penetration of both immune cells (for example, T cells) and our bispecific antibody, to enhance
tumor response to HX009. We explored through translational medicine to bridge the gap
between basic scientific discoveries and clinical applications. By aligning clinical development
with translational findings, we optimize the likelihood of success and expedite the delivery of
novel therapies to patients in need.
Similarly, the potent CSF1R inhibition and brain-penetrant properties of HX301 position
it as a promising candidate for glioblastoma treatment in combination with temozolomide,
filling a significant gap in current therapeutic options. Through our comprehensive
translational approach, we strive to advance a strong product pipeline, paving the way for
transformative advancements in patient care within the realm of oncology and beyond.
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Furthermore, we strategically collaborate with leading translational science-focused
organizations, such as Crown Bioscience, which bolster our capabilities to conduct essential
preclinical and translational studies. By leveraging advanced pharmacology and toxicology
assessments, biomarker discovery and validations through these collaborations, we have been
generating robust data that steers our clinical development decisions. By harnessing cutting-
edge translational technologies and methodologies, we deepen our understanding of disease
biology and therapeutic mechanisms, laying a solid foundation for successful clinical
translation.
Strong Expertise and Capabilities in Structural Biology and Protein Engineering
Empowered by Proprietary Technology Platforms for Enhanced Druggability and
Sustainable Pipeline Growth
Our Company possesses extensive proficiency and advanced techniques in structural
biology and protein engineering, underpinned by proprietary technology platforms that ensures
good druggability and sustainability of our pipeline. Departing from traditional approaches to
conventional bispecific antibody drug development methods reliant on fixed molecular
formats, our innovative V ersatiBody Platform focuses on the diversification of BsAb forms to
optimize combinatory selection of targets. Unlike traditional approaches, V ersatiBody Platform
enables flexible linking of binders or functional parts in a modular manner, facilitating the
construction of varying molecular forms tailored to specific therapeutic targets. Through the
utilization of various bispecific antibody technologies, our V ersatiBody Platform empowers us
to identify the optimal pairing mode and molecular form, thereby maximizing efficacy and
therapeutic windows.
In delineating our core competencies, V ersatiBody Platform features several key attributes
that distinguish our approach. Firstly, our platform offers flexible structures for single and
multi-targeting with customizable affinity and avidity to optimize efficacy and toxicology
across diverse target biology. By enhancing attributes such as antibody-dependent cellular
cytotoxicity, internalization, and tissue specificity, we ensure our molecules exhibit potent
therapeutic actions while minimizing off-target effects. Additionally, we prioritize the
attainment of desired pharmacokinetic and safety properties, such as controlled affinity to
reduce antigen sink resulted from the expression of targeting antigens in the system and
systemic toxicity, ensuring the safety and tolerability of our therapeutics in clinical settings.
Furthermore, our molecules are engineered to be stable and CMC-friendly, facilitating efficient
manufacturing processes and formulation development. Notably, our pipeline comprises
several novel molecules with desirable pharmaceutical properties that have advanced to various
stages of development, evidently by successful candidates such as HX009, HX044 and HX111.
These molecules represent the culmination of our expertise in structural biology and protein
engineering, offering promising therapeutic solutions for diverse of unmet medical needs
across different disease indications.
In addition, we are developing a unique therapeutic platform, the autoRx40 Platform, to
target OX40 receptor and beyond, where OX40 plays a pivotal role in the pathogenesis of
various autoimmune and inflammatory diseases. We are engineering our pipeline products,
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such as HX035 and HX038, to either deplete OX40-expressing cells, block OX40-OX40L
interactions, or both, offering a multifaceted approach to treating autoimmune diseases by
regulating T cell activation, survival, and tolerance. Through a series of pipeline products
derived from the autoRx40 Platform targeting OX40 receptor and beyond, we may take a
leading position in clinic of the treatment of certain autoimmune diseases.
Proven Business Development Capabilities Bring in Strategic Partnerships
Our Company demonstrates proven business development capabilities, evidenced by our
successful collaborations that bring in strategic partners. We forged a productive cooperation
with Lepu after the early phase of the clinical development of HX008 and assisted the clinical
development of HX008 till the eventual regulatory approval for the commercialization of
HX008. The cooperation with Lepu exemplifies the strong commercialization potentiality of
our products, and our capabilities to leverage the sales, marketing, and manufacturing
competencies of our business partners to maximize the market reach of our products in the
future. Through this collaboration, we have secured milestone payments and annual royalty
fees, demonstrating the market recognition and value of our innovative therapeutics.
Our commercialized product, HX008, stands out due to its superior pharmacology profile
compared to other PD-1 inhibitors in the market. Through a series of equity transfer
agreements entered in between 2017 and 2019, HX008 was transferred to Lepu for a one-off
cash payment of RMB350.0 million and annual royalty fee of 4.375% of the annual net sales
revenue of HX008. As of the Latest Practicable Date, we have received full payment of the
one-off cash payment of RMB350.0 million, and approximately RMB0.7 million, RMB4.4
million and RMB13.1 million as the HX008 annual royalty fee in accordance with its net sales
revenues recorded in 2022, 2023 and 2024, respectively.
Our collaboration with Onconova Therapeutics, Inc. (the “ Onconova ”, predecessor of
Traws Pharma, Inc. after a business combination in April 2024) extends our reach and
capabilities in oncology therapeutics, strengthening our portfolio and advancing our mission to
address unmet medical needs. Narazaciclib is a multi-kinase inhibitor small molecule that
Hangzhou Hanx is co-developing with Onconova for different markets and different
indications. In December 2017, we entered into a license, development and commercialization
agreement with Onconova (the “ Onconova Co-development Agreement ”). Pursuant to the
Onconova Co-development Agreement, Onconova grants Hangzhou Hanx an exclusive,
royalty-bearing license, with the right to sublicense, to develop and commercialize narazaciclib
which was further developed and named as HX301 for our pipeline within Greater China. Such
development and commercialization rights include all activities relating to research, non-
clinical, preclinical and clinical, toxicology testing, statistical analysis and reporting,
preparation and submission of applications for regulatory approval of the product and all
activities directed to the marketing, promotion, selling or offering for sale of a product for an
indication. On the other hand, Hangzhou Hanx grants Onconova to develop and manufacture
the narazaciclib outside Greater China. In addition, Onconova shall pay us certain royalties for
sales outside Greater China. Currently, Hangzhou Hanx focuses on glioblastoma combination
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treatment in China. As of the Latest Practicable Date, we have completed the Phase I clinical
trial of HX301 that designed for treatment in patients with advanced solid tumor, and the
principal investigator has issued the relevant clinical study report dated July 3, 2024.
Bolstered by our exceptional research and development and preclinical capabilities, we
lay a solid foundation for future business development plans, facilitating the identification and
advancement of innovative therapeutic candidates. Through strategic partnerships, milestone
achievements, and a robust pipeline supported by strong clinical data, we continue to drive
growth and deliver impactful remedies to patients worldwide.
Experienced Management Team and Renowned Investors
Our management team possesses extensive expertise in the field of structural biology and
protein engineering, translational medicine, and clinical development. Our in-depth knowledge
is further bolstered by the backing of esteemed investors, which significantly amplifies the
robustness and promise of our pharmaceutical development pipeline.
Our leading management team, comprising our chairman, CSO and CMO are pioneering
in the biopharmaceutical industry. Their profound expertise in structural biology, protein
engineering, translational medicine and clinical development is rooted in their extensive
experience. This background positions them to adeptly navigate our drug pipeline from
inception to market launch, leveraging insights gained from relationships with leading
multinational pharmaceutical companies and strategic collaborations. Their proven track
record in successfully advancing drug candidates from preclinical research to clinical trials
ensures the efficient progression of our pipeline and maximizes the chances of success.
Moreover, the strong expertise with successful track record of advancing multiple clinical
candidates through clinical development to market approvals, as well as global regulatory
experiences, from working at MNC pharmaceutical companies, is instrumental for the success
of the company.
A prime example is chairman and executive Director, Dr. Zhang, who has over 30 years
of extensive research and development experience in the pharmaceutical and biotechnology
industry. Dr. Zhang was generally responsible for researches and drug development in his
previous positions in leading universities and companies such as University of Texas
Southwestern Medical Center, Indiana University, Eli Lilly & Company, etc. In addition, Dr.
Zhang is a successful serial entrepreneur who worked as a co-founder and chief executive
officer of Crown Bioscience (Beijing) Co., Ltd. and established Waterstone Pharmaceuticals.
Our CEO and CSO, Dr. Li, has approximately 20 years of extensive medical research and
development experience in the U.S.. He worked as the CSO in Crown Bioscience Inc. for over
a decade, spearheading cancer-related research and development. Dr. Li was generally
responsible for drug discovery in his previous positions in industry leading companies such as
Kylin Therapeutics, Inc.
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Furthermore, our CMO and vice general manager, Ms. Zhang, has over 23 years of
experience in research and development of new medicines. Ms. Zhang was generally responsible
for the clinical development of multiple indications in her previous positions in Eli Lilly and
Company, Novartis Pharmaceuticals Corporation, Celgene Corporation and Denovo Biopharma
LLC. Such extensive experience in sophisticated pharmaceutical companies equips our
management team with considerable expertise in research and development of product pipeline.
For details, please refer to “Directors, Supervisors and Senior Management” in this prospectus.
Our company is acknowledged and endorsed by a diverse range of investors, including
pharmaceutical industry veterans and renowned financial investors. Their endorsement reflects
confidence in our management team, coupled with our innovative drug pipeline and promising
clinical data, underscores the strength and potential of our company. With the support of these
investors, we are well-positioned to continue advancing our mission of developing
transformative therapies to address unmet medical needs and improve patient outcomes.
OUR STRATEGIES
Advance Clinical Development of Our Product Pipeline
In our commitment to advancing clinical development, we have outlined future plans for
the clinical and commercialization applications of key candidates in our product pipeline,
including HX009, HX301 and HX044.
 HX009: We aim to initiate control-arm pivotal registrational studies for HX009 for
treatment of R/R EBV
+ NHL and advanced melanoma in 2026. In addition, in September
2024, NMPA granted us the clinical trial approval for HX009 regarding a combination
clinical study, which is a Phase IIa clinical study protocol for the combination treatment
of HX009 and a pivotal-stage drug in patients with malignant advanced BTC. We have
launched this combination study (i.e., the HX009-II-05 China Study) with first patient
enrolled in January 2025. We also obtained the NMPA approval in February 2025 for a
combination study of HX009 with trastuzumab in patients with advanced triple-negative
breast cancer, and we expect the first patient enrollment for this combination study to be
in 2026.
 HX301: In August 2024, we obtained the NMPA approval to proceed with clinical trials
of HX301 in combination with temozolomide in the treatment of patients with
glioblastoma. We have enrolled first patient for this combination study (i.e., the
HX301-II-01 China Study) in January 2025, and the HX301-II-01 China Study is
currently ongoing as of the Latest Practicable Date. Going forward, we plan to commence
a Phase III randomized, control arm registrational study in glioblastoma in 2027.
 HX044: We are conducting an ongoing first-in-human phase I study in patients with
advanced solid tumors in Australia (i.e., the HX044-I-01 Australia Study) with first
patient enrolled in December 2024. In addition, we have obtained from NMPA the clinical
trial approval notification for HX044 monotherapy and a combination study of HX044
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with pucotenlimab in patients with advanced solid tumor malignancies in January and
September 2025, respectively (i.e., the HX044-I-01 China Study). The advanced solid
tumor targeted by our product refers to relapsed/refractory solid tumor. As of the Latest
Practicable Date, we have enrolled 23 patients for the monotherapy part (with eight
patients in Australia and 15 patients in China) and two patients for the combination
therapy part, respectively. Following the completion of dose escalation to determine the
RP2D based on the safety, pharmacokinetic, and efficacy data, which is expected to be
obtained in the fourth quarter of 2026, we aim to commence a phase IIa study to
investigate efficacy and safety at the RP2D level and complete the HX044-I-01 studies by
the first half of 2029.
Continue Exploring Combination Therapies for Our Product Pipeline
As part of our commitment to advancing innovative treatment approaches, we are actively
exploring combination therapies for our product pipeline, aiming to enhance efficacy and
improve outcomes for patients.
 HX009 combination treatment with a pivotal-stage drug in advanced biliary tract
cancer: We are evaluating the potential of combining HX009 with a pivotal trial stage
anti-fibrotic drug in patients with advanced biliary tract cancer who have progressed after
standard treatment. This study aims to assess the synergistic effects of HX009 and a
pivotal-stage drug, potentially offering a novel therapeutic approach for patients facing
limited treatment options for this challenging disease. The drug used in this combination
study is a focal adhesion kinase inhibitor (aka. FAKi) drug developed by InxMed Biotech
Co., Ltd. (Shanghai)* (Ҧ(ɪऎ)ʮ̡). As of the Latest Practicable Date,
this FAKi drug was in its pivotal trial stage (Stage III), and obtain NDA market approval
on our HX009 for the treatment of BTC relies on the successful market development of
this drug. As of the same date, we have enrolled nine patients for this combination study.
 HX009 combination treatment with trastuzumab in advanced triple-negative breast
cancer: We also obtained the NMPA approval in February 2025 for a combination study
of HX009 with trastuzumab in patients with advanced triple-negative breast cancer, and
we expect the first patient enrollment for this combination study to be in 2026.
 HX301 combination treatment with temozolomide in glioblastoma patients: We are
exploring combination treatment with temozolomide in glioblastoma patients who have
undergone surgery and standard concurrent chemoradiotherapy but have not received any
other treatment thereafter. We plan to initiate a phase III study in 2027 to further evaluate
the efficacy and safety of this combination regimen. By combining HX301 with
temozolomide, we aim to capitalize on synergistic effects and potentially improve clinical
outcomes for glioblastoma patients, addressing an unmet medical need in this challenging
disease indication.
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 HX044 combination treatment with pucotenlimab in patients with advanced solid
tumour: We are evaluating the safety, tolerability and also determining the MTD and
RP2D of HX044 in combination with pucotenlimab in patients with advanced solid
tumour malignancies. The advanced solid tumor targeted by our product refers to
relapsed/refractory solid tumor. We obtained the clinical study approval from NMPA for
this combination study in September 2025, and we enrolled first patient for the
combination therapy in November 2025.
 Exploring immuno-oncology and ADC combinations in clinical trials: We are actively
exploring the synergistic potential of immuno-oncology therapies and ADCs through
clinical trials. With a portfolio of immuno-oncology products such as HX009, HX044 and
HX017, and ADC products HX111 and HX129, we are investigating combination
therapies to enhance therapeutic efficacy and broaden the applicability of our products
across different cancer indications.
Enhance Our Research and Development Capabilities
As we continue to innovate and expand our product pipeline, it is crucial to further
enhance our research and development capabilities. Below sets forth the key initiatives to
strengthen our research and development endeavors:
 Explore novel target biology to meet clinical needs: We strive to explore new disease
biology of target molecule so to benefit the development of specific cancer treatments.
This include target molecules on tumor cells or on tumor micro-environments, which are
exemplified by target molecules of our HX044, HX111, HX009 and HX301.
 Expanding applications of products pipeline: In addition to exploring novel oncology
indications, we are exploring the applications of our existing oncology pipelines in other
disease fields. For example, we are investigating the potential applications of HX017 in
anti-infection indications, as well as exploring the application of HX111 in autoimmune
and inflammatory conditions. By diversifying the therapeutic applications of our
products, we aim to address unmet medical needs across a broad spectrum of diseases.
 Optimizing molecule discovery workflow: We are dedicated to optimizing our molecule
discovery workflow to expedite the antibody discovery process and increase throughput.
By streamlining processes and leveraging advanced technologies such as our V ersatiBody
Platform and autoRx40 Platform as well as sourcing out high-throughput protein
expression, we aim to shorten timelines and enhance productivity in identifying
promising therapeutic candidates.
 Exploring natural molecules to engineer our drugs: In our quest to expand our target
portfolio, we are actively exploring natural receptors and ligands as potential binders or
functional modules. By tapping into nature’s vast repertoire of biological molecules, we
aim to uncover novel targets with therapeutic potential and broaden the scope of our
research and development efforts, while reduce the risk of anti-drug antibody.
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 Collaborating for efficient pharmacology and translational research: Collaboration
with contract research organizations and clinical institutes is paramount for accelerating
preclinical pharmacology and translational research. For instance, in our collaboration
with Crown Bioscience, we aim to enhance the efficiency and precision of indication
identification and patient stratification processes, paving the way for the rapid
development of innovative therapeutic interventions.
These initiatives underscore our commitment to advancing research and development
capabilities, driving innovation, and ultimately delivering transformative therapies to address
unmet medical needs. Through strategic collaborations, technological advancements, and a
relentless pursuit of scientific excellence, we aim to make meaningful contributions to the field
of biopharmaceuticals and improve patient outcomes worldwide.
Upgrade Our Existing Platform and Build New Platforms for New Modality Drugs
In our commitment to innovation and advancing drug discovery, we are focused on
upgrading our existing platforms and building new platforms for novel modality drugs. Below
sets forth our key initiatives:
 Optimizing the V ersatiBody and autoRx40 Platforms: We are dedicated to optimizing
our V ersatiBody Platform to delve deeper into target biology and address the evolving
needs of antibody therapeutics and antibody-drug conjugate therapeutics, including those
bispecific antibodies and bispecific antibody-drug conjugate. In addition, we are also
developing a unique therapeutic platform, the autoRx40 Platform, to target the OX40
receptor and beyond, where OX40 plays a pivotal role in the pathogenesis of various
autoimmune and inflammatory diseases. We are engineering our products, such as HX035
and HX038, to either deplete OX40-expressing cells, block OX40-OX40L interactions, or
both, offering a multifaceted approach to treating autoimmune diseases by regulating
T cell activation, survival, and tolerance. By enhancing our understanding of target
biology, we aim to identify more novel targets and target combinations, paving the way
for the development of novel therapeutic interventions.
 Building potential ADC research and development platform: Leveraging the
V ersatiBody Platform and independent intellectual properties, we are establishing our
own ADC research and development by collaborating with partners, involving novel
linkers and drug payloads tailored to our ADC products, enhancing their efficacy and
safety profiles. By combining our expertise in antibody engineering with innovative ADC
technologies, we aim to deliver next-generation ADC therapies with improved therapeutic
outcomes.
Through strategic investments in platform development and exploration of novel
therapeutic modalities, we aim to make meaningful contributions to the advancement of
healthcare.
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Enhance Business Development and Strengthen Global Partnerships
As we continue to advance our drug pipeline, enhancing our business development efforts
and forging strong global partnerships are key priorities. We are implementing the following
strategic initiatives:
 HX009 development partnerships: As we prepare to initiate pivotal registration studies
for HX009, we will actively seek development partners and explore out-licensing
opportunities. By collaborating with strategic partners, we aim to leverage their expertise
and resources to accelerate the clinical development, including but not limited to
combination treatments with partner’s either commercialized or investigational drugs,
and commercialization of HX009, maximizing its potential to address unmet medical
needs in oncology.
 HX301 global collaboration with business partners: In December 2017, we entered into
a license, development and commercialization agreement with Onconova Therapeutics,
Inc., and currently, Onconova focuses on CDK4/6 inhibition for the treatment of
endometrial carcinoma in the U.S., while Hangzhou Hanx focuses on GBM combination
treatment in China. Our collaboration with Onconova extended our reach and capabilities
in oncology therapeutics, strengthening our portfolio and advancing our mission to
address unmet medical needs. We will continue to seek collaborations with global
partners so as to offer new treatment options for patients suffering from certain type of
cancer.
 Exploration of other preclinical assets: Based on the data generated from our preclinical
assets, particularly following first-in-human Phase 1 clinical trials, we will initiate
business development activities on our new pipelines including HX111, HX016 and
HX035. Once we have preliminary clinical data indicating safety and efficacy, we will
actively engage in discussions with potential partners to explore collaboration
opportunities and advance our preclinical assets toward clinical development and
commercialization.
These initiatives demonstrate our proactive approach to business development, as we seek
to leverage external expertise, resources, and global networks to advance our drug pipeline and
bring innovative therapies to patients in need. By fostering strategic partnerships and
collaborations, we aim to accelerate the development and commercialization of our novel
therapeutics, ultimately improving patient outcomes and addressing unmet medical needs on a
global scale.
Continue to Build Up an Internal Clinical Development Team
In our pursuit of advancing clinical development and ensuring the seamless progression
of our pipeline, we recognize the paramount importance of a robust internal clinical
development team. Currently, in addition to our CMO and vice general manager, Ms. Zhang,
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our clinical team comprises 17 dedicated professionals. This team is structured to include 11
members in clinical operations, three in the medical department, one in pharmacovigilance, one
in data management, and one in quality assurance/quality control.
Looking ahead over the next three to five years, we are committed to fortifying our
clinical infrastructure and refining our standard operating procedures (SOP) to uphold the
highest standards of operational excellence. To achieve this, we plan to optimize our resource
allocation by outsourcing data statistics and pharmacovigilance functions to reputable contract
research organizations. With a strategic focus on strengthening our clinical capabilities, we aim
to enhance our agility, efficiency, and responsiveness in navigating the complex landscape of
clinical development, so as to meet the evolving demands of our pipeline.
Continue to Attract and Retain Talents to Fuel Our Expansion
Attracting and retaining top-tier talent is central to our growth strategy. We recognize that
the caliber of our team directly impacts our ability to achieve our long-term objectives. To
ensure we have the right people in place to support our development goals, we have
implemented a strategic approach to talent acquisition. This involves aligning our recruitment
plans with the strategy and future business needs of our Company. By conducting thorough
analysis of the skills and expertise we will require down the line, we can tailor our recruitment
efforts to attract individuals who possess the qualities necessary to drive our success.
Beyond conventional recruitment channels, we proactively seek out a variety of channels
to source talent. This proactive strategy encompasses engaging with professional networks,
participating in industry forums, and leveraging internal referral programs. By casting a wide
net and tapping into various talent pools, we increase our chances of identifying individuals
who bring unique perspectives and valuable skill sets to our team. We prioritize a
comprehensive candidate assessment process that goes beyond professional experience. We
evaluate candidates for their potential to grow within our organization and their fit with our
company culture. By prioritizing the well-being and professional growth of our team members,
we create a workplace where individuals feel valued, supported, and motivated to contribute
their best work.
OUR PRODUCT PIPELINE
As a science-driven biotech company, we have internally developed all of our pipeline
candidates (except for HX301) by utilizing our proprietary and integrated R&D platforms. We
constructed our pipeline to harness both innate and adaptive arms of immunity to unleash their
synergistic potential. Our pipeline is designed to address the limitations of current checkpoint
inhibitors, such as limited response due to “cold tumors” with immune-suppressive tumor
micro-environment and to other unmet medical needs, thereby bringing clinical benefits to
patients with a wide range of cancer as well as other diseases indications. As of the Latest
Practicable Date, we had built up a pipeline composed of 10 drug products, with three pipeline
products in clinical stage. Except for HX301, which we own development and
commercialization rights in Greater China and certain royalties for sales outside of Greater
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China, we own worldwide IP , development and commercial rights to our other pipeline
candidates, which allows us to address critical medical needs in the global market. Currently,
we plan to prioritize the clinical trials for our pipeline candidates in China, and have no plan
for any pivotal-trial stage development, manufacturing and commercialization of our product
candidates in Australia and the U.S. due to significant funding needs for pivotal-stage clinical
trials and commercialization. We’ll advance to these markets when clear strategic synergies
arise, and may consider opportunities if collaborative prospects emerge.
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As of the Latest Practicable Date, our Core Product HX009 and our Key Products HX301 and HX044 are under clinical trials in China and
Australia. The following chart summarizes the development status of our pipeline products as of the Latest Practicable Date:
Class of DrugsMoAsProduct Current Indication/
Therapeutic Area  Commercial RightsTreatment Line Preclinical Phase Ia/I Phase III/
Registrational PartnershipUpcoming
MilestonePhase Ib/II NDA/
BLA
small moleculeCSF1R/ARK5/
CDK4/6/FLT-3
Glioblastoma
(combination therapy) Greater China
Clinical Pre-Clinical
Global
Complete Phase Ib clinical
study by the second half of 2026
Complete Phase Ib
clinical study by end of 2025
Complete Phase IIa
clinical study by end of 2028
Complete Phase IIa
clinical study by the third
quarter of 2027
Launch Phase IIa
clinical study in 2026
N/A
N/A
2L+
2L+
1L/2L+
1L
R/R EBV+ NHL
(monotherapy)
Advanced Melanoma
(monotherapy)
Advanced Biliary
Tract Cancer
(combination therapy)
HX009(1)
HX301(2)
Complete preclinical trial
and file IND application
by end of 2026
Advanced solid tumor
malignancies (monotherapy
and combination therapy)
Global
Complete dose escalation
clinical study by the fourth
quarter of 2026
2L+
BsAb GlobalInflammation/autoimmuneHX035 File IND application
by the first quarter of 2026OX40 epitopes N/A
Inflammation/autoimmune GlobalBsAbHX038
Complete preclinical trial by end
of 2026 and file IND application
by the first quarter of 2027
OX40/
Undisclosed target N/A
Global mAb-ADCUndisclosed
target Selected T-L/L+ solid tumorsHX111 Obtain IND approval by
the first quarter of 2026N/A
HX044(3)
N/A(5) mAbNKG2A PD-1-resistant solid tumors/
viral infection GlobalHX017 N/A
BsAbPD1/VEGF Solid tumors GlobalHX016-9 N/A
BsAbPD-L1/VEGF Solid tumors GlobalHX016-7 N/A
HX129 Selected T-L/L GlobalmAb-ADCTRBV12 N/A N/A(5)
Co-development
PD-1/SIRPα
CTLA-4/SIRPα
bifunctional
antibody
fusion protein
bifunctional
antibody
fusion protein
 Core Product Key Product
2L+
Advanced Triple-Negative
Breast Cancer
(combination therapy)
Competent Authority
NMPA
NMPA
NMPA
NMPA
NMPA
TGA/NMPA
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Notes:
(1) We obtained from NMPA the clinical trial approval notification (i) for HX009 monotherapy in patients with malignancies in October 2019, (ii) for H X009 in combination with
a pivotal stage drug in patients with advanced solid tumor (including BTC and advanced melanoma) in September 2024, and (iii) for HX009 in combination with trastuzumab
in patients with advanced triple-negative breast cancer in February 2025. As of the Latest Practicable Date, we have completed Phase Ia of the HX009-I -01 China Study, which
is a standalone and conventional Phase I clinical study. We are currently conducting Phase Ib of the HX009-I-01 China Study for the treatment of advanc ed melanoma, the
HX009-II-02 China Study for the treatment of R/R EBV + NHL, and the HX009-II-05 China Study for the treatment of advanced biliary tract cancer, which is a combination
study with a focal adhesion kinase inhibitor (aka. FAKi) drug developed by InxMed Biotech Co., Ltd. (Shanghai)* (Ҧ(ɪऎ)ʮ̡). As of the Latest Practicable
Date, this FAKi drug was in its pivotal trial stage (Stage III), and HX009 for this study will only be used together with this FAKi drug once it receives th e market authorization
approval. The dotted line represents the exempted stages for these two combination studies of HX009, which was granted as leveraging study results fr om other clinical trial
programs of HX009 (including HX009-I-01 Australia Study and Phase Ia of the HX009-I-01 China Study) and communications with the Competent Authoriti es in this regard.
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(2) We obtained from NMPA the clinical trial approval notification for HX301 monotherapy in patients with advanced malignancies in January 2020 and f or HX301 in combination
with temozolomide in patients with glioblastoma in August 2024, respectively. As of the Latest Practicable Date, we have completed Phase I clinical s tudy of the HX301-I-01
China Study. We are currently conducting the Phase IIa clinical study of HX301 in combination with temozolomide (i.e., HX301-II-01 China Study), and have enrolled seven
patients as of the Latest Practicable Date. The dotted line represents the exempted stages for the combination study of HX301, which was granted as lev eraging study results
from other clinical trial programs of HX301 (including HX301-I-01 China Study and Onconova 19-01 phase 1 study conducted in the U.S.) and communicati ons with the
Competent Authorities in this regard.
(3) Pursuant to the relevant laws and regulations in Australia, we submitted our Human Research Ethics Committee (HREC) application for HX044, and ob tained the HREC approval
dated September 10, 2024 for conducting a Phase I/IIa clinical study to evaluate the safety and tolerability of HX044 in the treatment of patients with advanced solid tumor
malignancies (i.e., the HX044-I-01 Australia Study). As of the Latest Practicable Date, we have enrolled eight patients for the HX044-I-01 Australi a Study. In addition, we have
obtained from NMPA the clinical trial approval notification for HX044 monotherapy and a combination study of HX044 with pucotenlimab in patients wit h advanced solid tumor
malignancies in January and September 2025, respectively (i.e., the HX044-I-01 China Study). The advanced solid tumor targeted by our product refer s to relapsed/refractory
solid tumor. As of the Latest Practicable Date, we have enrolled 15 patients for the monotherapy part and two patients for the combination therapy part , respectively, for the
HX044-I-01 China Study.
(4) Prior to the Track Record Period, we co-developed HX008 with Zhongshan Kangfang, which is, a mAb targeting PD-1 with a proven long half-life. Short ly after we obtained
the clinical study approval in August 2017 and through a series of equity transfer agreements entered in between 2017 and 2019, HX008 was transferred t o Lepu for a one-off
cash payment of RMB350.0 million and annual royalty fee of 4.375% of the annual net sales revenue of HX008. In July and September 2022, the NMPA granted c onditional
marketing approval for HX008 for the treatment of MSI-H/dMMR solid tumors and inoperable or metastatic melanoma, respectively. As of the Latest Prac ticable Date, we have
received full payment of the one-off cash payment of RMB350.0 million as the milestone payment, and approximately RMB0.7 million, RMB4.4 million and RMB13.1 million
as the HX008 annual royalty fee for 2022, 2023 and 2024, respectively. For details, please refer to “Business — Collaborative Agreements — HX008 Equit y Transfer
Agreements” in this prospectus.
(5) The pipeline candidates were developed as preclinical candidate compounds. As of the Latest Practicable Date, we have completed the preclinical studies and achieved promising
results for the respective pipeline candidates. We plan to proactively seek collaboration with industry-leading business partners to further deve lop these pipeline candidates.
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Summary of Completed and Ongoing Clinical Studies
The table below sets forth an overview of our completed and ongoing clinical studies as of the Latest Practicable Date by each clinical study:
Phase Site Jurisdiction Authority Indication Status
Patient
Enrolled Start Date (1)
(Expected)
Completion Date (2)
HX009-I-01 Australia Study (3)
Study design: first-in-human study evaluating the safety, tolerability, pharmacokinetics, and initial efficacy
I Australia TGA advanced malignancies Completed with primary and
secondary endpoints achieved
21 October 2019 October 2022
HX009-I-01 China Study (4)
Study design: open-label, multicenter, dose escalation and dose expansion study
Ia(5) China NMPA advanced solid tumor Completed with primary and
secondary endpoints achieved
25 June 2020 July 2024
Ib(6) China NMPA advanced melanoma Ongoing 46 November 2023 2026H2
HX009-II-02 China Study (7)
Study design: dose escalation and dose expansion study
Ia China NMPA R/R lymphoma
(including R/R EBV
+NHL)
Ongoing 7 December 2021 N/A
Ib/II China NMPA R/R lymphoma
(including R/R EBV + NHL)
Ongoing 41 November 2022 end of 2025
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Phase Site Jurisdiction Authority Indication Status
Patient
Enrolled Start Date (1)
(Expected)
Completion Date (2)
HX009-II-05 China Study (8)
Study design: dose escalation and dose expansion study
IIa China NMPA advanced biliary tract cancer Ongoing 9 January 2025 2027Q3
HX301-I-01 China Study
(9)
Study design: open-label, multicenter, dose escalation study
I China NMPA advanced solid tumor Completed with primary and
secondary endpoints achieved
20 September 2020 July 2024
HX301-II-01 China Study
(10)
Study design: combination study with temozolomide
IIa China NMPA glioblastoma Ongoing 7 January 2025 end of 2028
HX044-I-01 clinical studies
(11)
Study design: first-in-human study evaluating the safety, tolerability, pharmacokinetics, and initial efficacy, including dose escalation and d ose expansion
HX044-I-01 Australia Study
I/IIa Australia TGA advanced solid tumor malignancies Ongoing 8 December 2024 2029H1 (13)
HX044-I-01 China Study
I/IIa China NMPA advanced solid tumor malignancies Ongoing 17
(12) March 2025 (13) 2029H1 (13)
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Notes:
(1) Being the first patient enrollment date for the respective clinical study.
(2) Unless otherwise specified, being the date of clinical study report for the respective clinical study that issued by the principal investigator. N/A means no clinical study report
available for the respective study. There is no separate clinical study report for Phase Ia of the HX009-II-02 China Study because, pursuant to the pro tocol design, Phase Ia
has enrolled only seven patients in this clinical study, and the clinical results of Phase Ia will be included in the clinical study report of phase Ib/I I, which is expected to be
completed in the fourth quarter of 2025.
(3) The primary objectives of the HX009-I-01 Australia Study are to (i) assess the safety and tolerability of HX009; and (ii) determine the maximum tol erated dose (MTD) and
the recommended Phase II dose (RP2D) of HX009 in subjects with advanced malignant tumors by evaluating dose-limiting toxicities (DLTs). The primary endpoints of the
HX009-I-01 Australia study are (i) treatment-emergent adverse events; (ii) changes in clinical laboratory assessments, vital signs, and electroc ardiograms results; and (iii)
evaluation of DLTs up to 28 days after the first dose of study treatment. The secondary endpoints of the HX009-I-01 Australia study are (i) including bu t not limited to terminal
elimination half-life, mean residence time in vivo, area under the plasma concentration-time curve from 0 to time of last quantifiable concentratio n, area under the
concentration-time curve from 0 to 168 hours, area under the concentration-time curve from 0 to 336 hours; area under the concentration-time curve fr om 0 to infinity hours
for day 1, apparent volume of distribution, apparent total serum clearance of drug, maximum concentration of the drug, time to maximum concentration of the drug, linear
relationship, and drug accumulation ratio; (ii) best overall response, objective response rate, duration of response, progression-free survival , overall survival, and disease control
rate at 6 and 12 months, as defined by RECIST V ersion 1.1 and immune RECIST; and (iii) occurrence of antidrug antibodies.
(4) The HX009-I-01 China Study (Phase Ia) is a conventional phase I clinical study according to the clinical design set out in its protocol. This conven tional phase I clinical study
has been completed. The current ongoing Phase Ib clinical study under the revised HX009-I-01 Protocol is conducted in patients with a selected indica tion to assess its efficacy,
which is generally regarded as part of a conventional phase II clinical study, and CDE has no objection for the Company to proceed with its phase II clini cal studies.
(5) The primary objectives of Phase Ia of the HX009-I-01 China Study were designed to evaluate the safety and tolerability of HX009 in patients with adv anced solid tumor, and
to determine the maximum tolerated dose and/or the recommended phase II dose of HX009. The primary endpoints of Phase Ia of the HX009-I-01 China Study a re (i) the DLTs
and the treatment-emergent adverse events; and (ii) the RP2D and MTD. The secondary endpoints of Phase Ia of the HX009-I-01 China Study are (i) investi gate the
pharmacokinetic characteristics of HX009 injection in patients with advanced solid tumors; (ii) evaluate the immunogenicity of HX009 injection by testing the production of
anti-drug antibodies; (iii) conduct a preliminary assessment of the anti-tumor efficacy of HX009 injection; (iv) evaluate the receptor occupancy o n peripheral blood T-cell
surfaces after intravenous administration of HX009.
(6) The primary objectives of Phase Ib of the HX009-I-01 China Study were to further evaluate the safety and preliminary efficacy of HX009 in patients w ith advanced melanoma.
The primary endpoints of Phase Ib of the HX009-I-01 China Study are (i) the rate and severity of adverse event, if any; and (ii) objective response rate a nd progression-free survival.
(7) The primary objectives for Phase Ia of the HX009-II-02 China Study are (i) to assess the safety and tolerability of HX009; and (ii) determine the max imum tolerated dose (MTD)
and the recommended Phase II dose (RP2D) of HX009 in subjects with relapsed/refractory lymphoma. The primary endpoints for Phase Ia of the HX009-II-0 2 China Study are
the rate and severity of adverse event. The primary objectives for Phase Ib/II of the HX009-II-02 China Study are to evaluate efficacy of HX009 in subje cts with
relapsed/refractory lymphoma. The primary endpoints for Phase Ib/II of the HX009-II-02 China Study are the objective response rate.
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(8) The primary objective for the HX009-II-05 China Study is to assess the safety and tolerability as well as anti-tumor efficacy of HX009 in combinati on with a pivotal stage drug
in patients with advanced solid tumor (including BTC and advanced melanoma). The primary endpoint for the HX009-II-05 China Study is RP2D and ORR of HX 009 in
combination with a pivotal stage drug. The secondary endpoints for the HX009-II-05 China Study are (i) duration of remission, disease control rate, p rogression-free survival
rate, as assessed by the investigator according to RECIST V ersion 1.1, progression-free survival rate at 6 and 12 months; (ii) overall survival, over all survival rate at 6 and 12
months; and (iii) adverse events, laboratory safety tests, vital signs, and 12-lead electrocardiogram, etc. According to the relevant PRC laws and r egulations, where a drug
approved to carry out clinical trials intends to add combination with other drugs, the applicant shall submit a new drug clinical trial application. F or details, please refer to
“Regulatory Overview — Principal Regulatory Provisions — Laws and Regulations on New Drugs — Conduct of Clinical Trial” in this prospectus. In Septem ber 2024, we
obtained the combination approval for this clinical study.
(9) The primary objectives and endpoints for the HX301-I-01 China Study are (i) to assess the safety and tolerability of HX301; and (ii) the MTD and RP2D of HX301. The
secondary endpoints of the HX301-I-01 China Study are (i) investigate the pharmacokinetic characteristics of HX301 monolactate capsules in patien ts with solid tumors; (ii)
conduct a preliminary evaluation of the efficacy of HX301 monolactate capsules in treating advanced solid tumors (including indicators such as obje ctive response rate,
progression-free survival, duration of response, and disease control rate.
(10) The primary objective for the HX301-II-01 China Study is to evaluate the safety and tolerability of HX301 combined with temozolomide in the treat ment of patients with
glioblastoma. The primary endpoint for the HX301-II-01 China Study is the RP2D of HX301 in combination with temozolomide. The secondary endpoints of the HX301-II-01
China Study are (i) incidence and severity of adverse events; (ii) objective remission rate, disease control rate, duration of remission, progressi on-free survival, and 6/12-month
PFS rate as assessed by the investigator according to the Response Assessment in Neuro-Oncology criteria; and (iii) overall survival. According to t he relevant PRC laws and
regulations, where a drug approved to carry out clinical trials intends to add combination with other drugs, the applicant shall submit a new drug clin ical trial application. For
details, please refer to “Regulatory Overview — Principal Regulatory Provisions — Laws and Regulations on New Drugs — Conduct of Clinical Trial” in th is prospectus. In
August 2024, we obtained the combination approval for this clinical study.
(11) The primary objectives for the HX044-I-01 clinical studies are to (i) assess the safety and tolerability of HX044; and (ii) determine the MTD and/ or the RP2D of HX044 in
subjects with advanced malignant tumors by evaluating DLTs. The primary endpoints for the HX044-I-01 clinical studies are (i) adverse events, clini cal laboratory assessments,
vital signs, and electrocardiograms; and (ii) evaluation of DLTs up to 21 days after the first dose of study treatment.
(12) As of the Latest Practicable Date, there were 15 and two patients enrolled for the monotherapy part and combination therapy part of the HX044-I-01 China Study, respectively.
(13) We expect to complete the dose escalation clinical study for the HX044 clinical studies by the fourth quarter of 2026, and complete the HX044 clini cal studies by the first half
of 2029.
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The table below sets forth an overview of our completed and ongoing clinical studies as of the Latest Practicable Date by each jurisdiction:
Study Name
(Designed)
Disease Stage
(Designed)
Duration of Treatment
(Designed)
Follow-up Period
(Designed)
Treatment Dosage
and Schedule Summary of the Results
Australia
HX009-I-01 Australia
Study /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Histologically confirmed
advanced malignant tumor
that is refractory/relapsed to
standard therapies, or for
which no effective standard
therapy is available, or the
subject refuses standard
therapy
Until the subject develops an
intolerable toxicity,
withdraws consent, developed
progression of disease (PD),
dies, lost to follow-up, or has
received study treatment for
24 months; whichever comes
first
Safety follow-up: 90 (±7)
days after the last dose of
study treatment
Survival follow-up: every 12
weeks
Once every two weeks
0.1 mg/kg, 0.3 mg/kg,
1.0 mg/kg, 2.0 mg/kg,
3.0 mg/kg, 5.0 mg/kg,
7.5 mg/kg
Completed with primary
objectives and endpoints
achieved
HX044-I-01 Australia
Study /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Histologically confirmed
advanced malignant solid
tumor that is
refractory/relapsed to
standard therapies, or for
which no effective standard
therapy is available, or the
subject refuses standard
therapy
Until the subject develops an
intolerable toxicity,
withdraws consent, developed
progression of disease (PD),
dies, lost to follow-up, start
of new anticancer treatment,
or up to study treatment
duration of 24 months;
whichever comes first
Safety follow-up: 30 (±7), 60
(±7), 90 (±7) days after the
last dose of study treatment
Survival follow-up: every 12
weeks ±7 days for subject
who reached 24 months of
study treatment
Once every three weeks
0.1 mg/kg, 0.5 mg/kg,
1.0 mg/kg, 2.0 mg/kg,
4.0 mg/kg, 8.0 mg/kg,
15.0 mg/kg, 25.0 mg/kg
Ongoing – expected
complete dose escalation
in the fourth quarter of
2026
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Study Name
(Designed)
Disease Stage
(Designed)
Duration of Treatment
(Designed)
Follow-up Period
(Designed)
Treatment Dosage
and Schedule Summary of the Results
China
HX009-I-01 China Study
(Phase Ia) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Histologically or cytologically
confirmed advanced
malignant solid tumor that
has progressed after or is
intolerant to standard
therapies, or for which no
effective treatment is
available
Until the investigator assessed
the subject no longer benefit,
subject either develops an
intolerable toxicity, withdrew
consent, developed
progression of disease (PD),
start of new anticancer
treatment, dies, lost to
follow-up, or have received
study treatment for 12
months; whichever occurs
first
28 (±10) days after the last
administration of the drug
Once every two weeks
0.3 mg/kg, 1.0 mg/kg,
2.0 mg/kg, 3.0 mg/kg,
5.0 mg/kg, 7.5 mg/kg,
15.0 mg/kg
Completed with primary
objectives and endpoints
achieved
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Study Name
(Designed)
Disease Stage
(Designed)
Duration of Treatment
(Designed)
Follow-up Period
(Designed)
Treatment Dosage
and Schedule Summary of the Results
HX009-I-01 China Study
(Phase Ib/II) Cohort A /H1118/H1118
Treatment-naive advanced
melanoma
Until the subject either
develops intolerable toxicity,
developed progression of
disease (PD), withdrawals
consent, start of new
anticancer treatment, dies,
loss to follow-up, study
termination/completion, or
have received study treatment
for 24 months; whichever
occurs first
Safety follow-up: 28 days
after the last dose of study
treatment
Survival follow-up: every 12
weeks for subject after end
of treatment
Once every two weeks
10mg/kg IV
Ongoing
HX009-I-01 China Study
(Phase Ib) Cohort B /H1118/H1118/H1118/H1118
Post-ICI (immune checkpoint
inhibitor) advanced
melanoma
Until the subject either
develops intolerable toxicity,
developed progression of
disease (PD), withdrawals
consent, start of new
anticancer treatment, dies,
loss to follow-up, study
termination/completion, or
have received study treatment
for 24 months; whichever
occurs first
Safety follow-up: 28 days
after the last dose of study
treatment
Survival follow-up: every 12
weeks after end of
treatment
Once every two weeks
10mg/kg IV
Ongoing
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Study Name
(Designed)
Disease Stage
(Designed)
Duration of Treatment
(Designed)
Follow-up Period
(Designed)
Treatment Dosage
and Schedule Summary of the Results
HX009-II-02 China Study
(Phase Ia) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Lymphomas diagnosed
according to the 2022 fifth
Edition WHO
Classification, meeting the
following
relapsed/refractory criteria,
including: (1)
Relapsed/refractory diffuse
large B-cell lymphoma; (2)
Relapsed/refractory
peripheral T-cell lymphoma;
(3) Relapsed/refractory
classical Hodgkin
lymphoma; (4)
Relapsed/refractory mantle
cell lymphoma; (5)
Relapsed/refractory
follicular lymphoma and
relapsed/refractory marginal
zone lymphoma.
Until the subject either
develops intolerable toxicity,
developed progression of
disease (PD), withdrawals
consent, investigator assessed
the risk out-weighted
benefits, start of new
anticancer treatment or
treatment study, dies, loss to
follow-up, or have received
study treatment for 12
months; whichever occurs
first
28 (±7) days after the last
administration of the drug,
and 90 (±7) days after the
last dose if the subject
experiences an immune-
related adverse event (irAE)
Once every two weeks
7.5mg/kg; 15mg/kg
Completed with data cutoff
date on September 12,
2023
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Study Name
(Designed)
Disease Stage
(Designed)
Duration of Treatment
(Designed)
Follow-up Period
(Designed)
Treatment Dosage
and Schedule Summary of the Results
HX009-II-02 China Study
(Phase Ib/II) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Lymphomas diagnosed
according to the 2022 fifth
Edition WHO
Classification, meeting the
following
relapsed/refractory criteria:
(1) Relapsed/refractory
diffuse large B-cell
lymphoma (DLBCL); (2)
Relapsed/refractory
peripheral T-cell lymphoma
(PTCL); (3)
Relapsed/refractory
follicular lymphoma (FL)
and relapsed/refractory
marginal zone lymphoma
(MZL); (4)
Relapsed/refractory EBV-
positive non-Hodgkin
lymphoma.
Until the subject either
develops intolerable toxicity,
developed progression of
disease (PD), withdrawals
consent, investigator assessed
the risk out-weighted
benefits, start of new
anticancer treatment or
treatment study, dies, loss to
follow-up, or have received
study treatment for 12
months; whichever occurs
first.
28 (±7) days after the last
administration of the drug,
and 90 (±7) days after the
last dose if the subject
experiences an immune-
related adverse event (irAE)
Once every two weeks
10mg/kg
Ongoing
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Study Name
(Designed)
Disease Stage
(Designed)
Duration of Treatment
(Designed)
Follow-up Period
(Designed)
Treatment Dosage
and Schedule Summary of the Results
HX009-II-05 China
Study /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Histologically or cytologically
confirmed
unresectable/metastatic
advanced malignant (biliary
tract tumors and melanoma)
Until the subject either
develops intolerable toxicity,
developed progression of
disease (PD), withdrawals
consent, start of new
anticancer treatment, dies,
loss to follow-up, study
termination/completion, or
have received study treatment
for 24 months; whichever
occurs first
Safety follow-up: 90 (±7)
days after the last dose of
study treatment
Survival follow-up: every 12
weeks after end of
treatment
Once every three weeks
7.5 to 15mg/kg IV ,
+ IN10018 100mg orally,
QD
Ongoing
HX301-I-01 China
Study /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Pathologically confirmed
advanced malignant solid
tumors who have failed
standard treatments
Until DLT in the observation
period, tumor progression,
withdrawal of consent, or the
subject develops intolerable
toxicity; whichever occurs
first
28 days after the last
administration of the drug
40 to 200 mg orally Completed with primary
objectives and endpoints
achieved
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Study Name
(Designed)
Disease Stage
(Designed)
Duration of Treatment
(Designed)
Follow-up Period
(Designed)
Treatment Dosage
and Schedule Summary of the Results
HX301-II-01 China
Study /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Pathologically diagnosed
glioblastoma that have
undergone initial surgery
and standard concurrent
chemoradiotherapy and have
not received any other prior
treatments
Until the subject either develop
disease progression (PD),
dies, develop intolerable
adverse events, withdrawal of
informed consent, or have
received study treatment for
24 months; whichever
occurred first
Safety follow-up: 28 (±7)
days after the last
administration of the drug
Survival follow-up: Every two
or four months after end of
treatment
120 mg or 160 mg orally,
QD + Temozolomide in
Standard Dose
Ongoing – expected to be
completed by end of 2028
HX044-I-01 China Study /H1118/H1118Histologically confirmed
advanced malignant solid
tumor that is
refractory/relapsed to
standard therapies, or for
which no effective standard
therapy is available, or the
subject refuses standard
therapy
Until the subject develops an
intolerable toxicity,
withdraws consent, develops
progression of disease (PD),
dies, lost to follow-up, start
of new anticancer treatment,
or have received study
treatment for 24 months;
whichever comes first
Safety follow-up: 30 (±7)
days, 60 (±7) days, 90 (±7)
days after the last dose
Survival follow-up: every
12 weeks ±7 days for
subject who reached
24 months of study
treatment
Once every three weeks
1.0 mg/kg, 2.0 mg/kg,
4.0 mg/kg, 8.0 mg/kg,
15.0 mg/kg, 25.0 mg/kg
Ongoing – expected
complete dose escalation
in the fourth quarter of
2026
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Summary of Clinical Studies under Preparation for Our Core Product and Key Products
Currently, we plan to prioritize our clinical studies for pipeline products in China and have no plan for any pivotal-trial stage development,
manufacturing and commercialization of our product candidates in Australia and the U.S.. The table below sets forth an overview of the next
milestone clinical studies under preparation for our Core Product and Key Products as of the Latest Practicable Date for illustrative purposes:
Indication Phase Primary Objective Primary Endpoint
Market
Jurisdiction
(Authority)
Expected
Patient
Enrollment
(Expected)
Start Date (1)
HX009
Advanced TNBC /H1118/H1118/H1118/H1118IIa(2) assess safety and
tolerability
RP2D China (NMPA) 50 2026
Advanced BTC /H1118/H1118/H1118/H1118/H1118III(3) assess efficacy median progression-free survival 250 2027Q3
Advanced melanoma /H1118III(4) assess efficacy median progression-free survival China (NMPA) 250 2026
EBV+NHL /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118II(5) assess efficacy median progression-free survival China (NMPA) 120 2026
HX301
GBM /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118III
(6) assess efficacy median progression-free survival and
median overall survival
China (NMPA) 400 2027Q4
HX044
NSCLC /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118III(7) assess efficacy median progression-free survival China (NMPA) 480 2028Q1
Notes:
(1) Being the date of first patient in (“ FPI”)
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(2) i.e., the HX009-II-04 China Study. The primary objective of the HX009-II-04 China Study is to evaluate the safety and tolerability of HX009 in comb ination with Enhertu ®
in patients with HER2- low or ultra-low expressing unresectable locally advanced or metastatic triple-negative breast cancer. The primary endpoin t of the HX009-II-04 China
Study is the RP2D of HX009 in combination with Enhertu ®. The secondary endpoints of the HX009-II-04 China Study are (i) objective response rate, disease control rate,
duration of response, and progression-free survival as assessed by the investigator according to RECIST V ersion 1.1 and iRECIST; and (ii) overall su rvival. According to the
relevant PRC laws and regulations, where a drug approved to carry out clinical trials intends to add combination with other drugs, the applicant shall submit a new drug clinical
trial application. For details, please refer to “Regulatory Overview — Principal Regulatory Provisions — Laws and Regulations on New Drugs — Conduct of Clinical Trial”
in this prospectus. In February 2025, NMPA granted us the phase IIa clinical study approval for HX009 in combination with trastuzumab for the treatmen t of advanced TNBC,
and we expect the first patient enrollment for this combination study to be in 2026.
(3) Phase III randomized, control-arm pivotal study.
(4) Phase III randomized, control-arm pivotal study.
(5) Phase II control-arm pivotal study.
(6) Phase III randomized, control-arm pivotal study.
(7) Phase III randomized, control-arm pivotal study.
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CLINICAL-STAGE CANDIDATES
Core Product — HX009
Overview
Immune checkpoint inhibitors, such as PD-1 and PD-L1 antibodies, have become one of
the most important cancer therapies. However, the immune checkpoint inhibitors other than
PD-1/PD-L1 blockers, e.g. CD47, CTLA-4, etc., although widely-tested as cancer therapeutics
in the clinic, have yet to be successful due to respective limitations such as marginal activity
and/or poor safety profiles. One possible solution to these limitations is specially engineered
molecules, e.g. bifunctional agents.
Our Core Product, HX009, is a specifically designed bifunctional anti-PD-1 antibody
SIRP /H9251fusion protein, which is designed to improve both efficacy and safety over the two
respective single-targeting immune checkpoint inhibitors. HX009 features 2+2 symmetric
IgG4, but with specifically weakened CD47 binding affinity.
Mechanism of Actions
HX009 is a bifunctional anti-PD-1 antibody SIRP /H9251fusion protein. The key achievement
of HX009 involves its capability to enhance the existing immune checkpoint inhibitors due to
its bifunctional structure with PD-1 to create a “PD-1 plus ” modality, so as to overcome certain
limitations of the existing immune checkpoint inhibitors. HX009 can efficiently activate
adaptive immune response of CD8
+ Teff by blocking PD-1 and cis engagement with CD47 on
Teff within tumor micro-environment via anti-PD-1 antibody and SIRP /H9251extracellular domain
on HX009. In addition, blocking CD47/SIRP /H9251can activate macrophages by decreasing the
CD47 “don’t eat me” signal and generate an activating pro-phagocytic signal. Activated
macrophages can then activate phagocytosis as well as secrete certain cytokines and
chemokines to recruit T cells to tumor sites, thus effectively converting “cold tumors” (tumors
that lack T cell infiltration) into “hot tumors” that are more responsive to the treatment of
PD-1/PD-L1 inhibitors.
mmetric
Weakened SIRPα domain
Anti-PD-1
Tumor
Cells
Macrophages
“Don’t Eat Me”
Innate Immunity
DC CD4+
CD8+
Macrophage
Phagocytosis
Antigen
Presentation
CD8+
CD8+ Cytotoxic
T Cell Killing
CD8+
CD8+ Cytotoxic
T Cell Killing
SIRPα
CD47
HX009
(PD-1/SIRPα BsAb)
PD-1
PD-L1
2+2 IgG4 sy
stable format
Source: Company data
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In addition, HX009 showed minimal binding to red blood cells (RBCs) and platelets. As
illustrated in chart Binding of HX009 to RBC, HX009 demonstrated little binding to RBCs
when compared to magrolimab, an anti-CD47 monoclonal antibody. Besides, the binding of
HX009 to RBC wasn’t increased when PNGase F, a deglycosylation enzyme was added,
suggesting that the lower affinity of HX009 to RBC is not due to glycosylation of CD47 on the
cell surface. As illustrated in chart Binding of HX009 to Platelets , HX009 exhibited
significantly less binding to platelets in comparison to magrolimab, implying that HX009
potentially have little impact on platelets.
Binding of HX009 to RBC
0.000001 0.0001 0.01 1 100 10,000
0
50,000
100,000
150,000
Conc. of Antibody (nM)
MFI
RBC + Magrolimab
RBC + HX009
RBC + PNGase F + Magrolimab
RBC + PNGase F + HX009
Binding of HX009 to Platelets
0
1,000
2,000
3,000
4,000Median APC-A
Magrolimab-PC
HX009
Isotype Control
Blank
Source: Company data
HX009 was expected to achieve solid anti-tumor activity with limited risk of anemia and
thrombocytopenia, caused by the off-tumor binding of HX009 to CD47 on human red blood
cells and platelet, via tumor-specific delivery, resulted from high affinity for PD-1 and the
reduced affinity to CD47, and therefore addressed concerns in relation to CD47 targeted drugs
such as blood toxicity, antigen sink, on-target/off-tumor effects and T cell apoptosis. All these
improve anti-tumor innate and adaptive immune responses, and would potentially be
representative of a new realm of immune checkpoint inhibitors.
Communications with Regulatory Authorities
Therapeutic Goods Administration (TGA)
Pursuant to the relevant laws and regulations in Australia, we submitted our HREC
application for the HX009-I-01 Australia Study to a certified HREC (the “ Approving HREC ”)
in May 2019. In July 2019, the Approving HREC issued the approval letter (the “ HREC
Approval Letter ”), confirming its approval of our clinical project, i.e. HX009-I-01 Australia
Study. In July 2019, we submitted the online notification form through the TGA website. In
December 2022, we notified TGA that the HX009-I-01 Australia Study has been completed
according to the protocol submitted. In addition, despite that TGA may request further
information from the trial sponsor regarding a clinical trial according to the relevant laws and
regulations, we have not received any request for further information or negative comments
from TGA after we filed the online notification in July 2019.
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NMP A
In July 2019, we submitted a Phase I clinical study protocol (the “ HX009-I-01 China
Study Protocol ”) to NMPA, which followed the ICH GCP and provided that the primary
objectives for this study are to (i) assess the safety and tolerability of HX009; and (ii)
determine the MTD and RP2D of HX009.
The HX009-I-01 China Study Protocol was accepted by NMPA in August 2019, and in
October 2019, NMPA issued the clinical trial approval notification (the “ HX009 NMPA
Umbrella Approval ”) to us, which confirms that HX009 satisfied the relevant requirements of
drug registration, and allows us to conduct clinical trials of this product for advanced malignant
tumors (such as hematologic malignancies, liver cancer, non-small cell lung cancer, advanced
gastric cancer, melanoma, renal cell carcinoma, and head and neck squamous cell carcinoma)
according to the NMPA HX009-I-01 Protocol. The HX009 NMPA Umbrella Approval also
confirms that we may adjust our product development strategies and clinical trial protocols as
appropriate based on the clinical trial development and the clinical trial data obtained, and may
communicate with the relevant regulatory authorities if necessary. We modified the HX009-
I-01 China Study protocol to add Phase Ib as an addition to the original protocol, and Phase
Ib is a dose expansion study and can be proceed upon approval from the ethics committees. The
Company submitted the annual DSUR with the information about revised protocol in
September 2023 and updated the protocol on the CDE official clinical study platform in
October 2023.
In addition, the HX009 NMPA Umbrella Approval provides that (i) after obtaining the
permission of the first clinical trial, the applicant shall regularly provide the Center for Drug
Evaluation (the “ CDE”) with safety update reports during drug research and development, and
submit them within two months after each year; and (ii) after completing the Phase I and Phase
II clinical trials and before carrying out the Phase III clinical trials, the applicant shall apply
to CDE for a communication meeting.
In January 2024, our PRC Legal Adviser conducted a formal hotline communication with
CDE of the NMPA (the “ January 2024 Formal Hotline Communication ”), which confirmed
that (i) for Phase I, Phase II and Phase III clinical trials for new drugs, the NMPA adopted
one-time approvals instead of phased approvals; (ii) except for seeking communication
meeting prior to the pivotal trial, sponsor companies may proceed with next-phase clinical trial
for efficacy exploration and confirmation after they have evaluated that they have satisfied the
primary endpoints for the safety-assessment phase, without additional NMPA approval or
confirmation, and CDE will not confirm the completion of such clinical trials; (iii) if no
objection from NMPA for the development safety update reports has been received, sponsor
companies may proceed with their clinical trials; and (iv) the clinical phasing is to facilitate
the understanding of the purpose of each phase, and all regulatory agencies, including CDE,
have no special requirements for naming the internal trial stages of the sponsor companies, as
long as the overall clinical trial can serve the purpose of assessing safety and efficacy.
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According to the relevant PRC laws and regulations, after completing the Phase I and
Phase II clinical trials and before carrying out the Phase III clinical trials, the applicant shall
apply to CDE for a communication meeting. In June 2024, we submitted an IND application
for a combination study of HX009, which is a Phase IIa clinical study protocol for the
combination treatment of HX009 and a pivotal trial stage (Stage III) FAKi drug in patients with
advanced malignant biliary tract cancer and melanoma. In September 2024, NMPA granted
clinical trial approval for this combination study (the “ HX009 NMPA BTC Combination
Approval ”), which allows us to conduct clinical trials of HX009 with this FAKi drug (and with
or without standard chemotherapy) for treatment of advanced solid tumor (including malignant
biliary tract cancer and melanoma). No additional approval is needed before we proceed to
carry out the confirmatory clinical studies or pivotal-stage clinical studies. The HX009 NMPA
BTC Combination Approval also provided that, after completing the exploratory clinical
studies and before carrying out the confirmatory clinical studies or pivotal-stage clinical
studies, the applicant shall apply to CDE for a communication meeting to evaluate subsequent
clinical studies.
In September 2024, our PRC Legal Adviser, together with the Sole Sponsor and its legal
advisers, conducted a face-to-face interview with a reviewer of the Office of Clinical Trial
Management Department from CDE of NMPA in Beijing (the “ September 2024 CDE
Interview ”), who is the competent person to address our inquiries according to our PRC Legal
Adviser. During the September 2024 CDE interview, we inquired with CDE that (i) whether the
Phase Ia (previously named as Phase I) of the HX009-I-01 China Study for advanced solid
tumor is considered to be a separate and standalone clinical trial under the NMPA HX009-I-01
Protocol, and whether it is a conventional phase I clinical study according to the clinical design
set out in its protocol; (ii) given that the clinical study report for the Phase Ia of the
HX009-I-01 China Study has been completed and the Company obtained the HX009 NMPA
BTC Combination Approval, whether conventional phase I clinical study of HX009 has been
completed and whether NMPA has no objection for the phase II clinical study of HX009; and
(iii) whether the Company may conduct clinical studies under HX009-I-01 China Study before
phase III pivotal trial stage clinical study without additional regulatory approval from NMPA.
CDE confirmed that: (i) the Phase Ia (previously named as Phase I) of the HX009-I-01
China Study for advanced solid tumor is considered to be a separate and standalone clinical
trial under the NMPA HX009-I-01 Protocol, and it is a conventional phase I clinical study
according to the clinical design set out in its protocol. This conventional phase I clinical study
has been completed; (ii) The current ongoing Phase Ib clinical study under the HX009-I-01
Protocol is conducted in patients with a selected indication to assess its efficacy, which is
generally regarded as part of a conventional phase II clinical study, and CDE has no objection
for the Company to proceed with its phase II clinical studies; (iii) the HX009 NMPA Umbrella
Approval has allowed the Company to conduct clinical studies under HX009-I-01 China Study
before phase III without additional regulatory approval from NMPA; and (iv) the HX009
NMPA BTC Combination Approval was granted for the Company’s phase IIa clinical study
protocol on the basis of the completed conventional phase I study (i.e., Phase Ia) results of the
HX009-I-01 China Study.
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The Sole Sponsor conducted independent due diligence including (i) reviewing the
HX009 NMPA Umbrella Approval, which confirms that HX009 has satisfied the relevant
requirements of drug registration and allows the Group to carry out clinical trials of HX009 for
advanced malignant tumors according to the NMPA HX009-I-01 Protocol; (ii) reviewing the
record of the 2024 Formal Hotline Communication with CDE of the NMPA, which confirms
that if no objection from NMPA for the development safety update reports submitted, the Group
may proceed with their next-phase clinical trial, prior to pivotal trial. No material concern from
the NMPA was noted and no objection from CDE regarding the development safety update
reports was received by the Group; (iii) attending the September 2024 CDE Interview; and (iv)
reviewing the clinical study report issued in July 2024 by the principal investigator of
HX009-I-01 China Study (Phase Ia) which confirms that the Phase Ia clinical study is to
evaluate the safety and tolerability of HX009 in patients with advanced solid tumors and this
has been completed. Based on the review of these documents and records, together with the
interview result, the Sole Sponsor is of the view that (i) the Phase Ia (formally named as Phase
I) of HX009-I-01 China study is a separate and standalone trial, which has been completed and
has reached the endpoints that are equivalent to a regulated Phase I clinical trial; and (ii) the
CDE has no objection for our Company to proceed with its Phase Ib clinical study under the
HX009-I-01 for efficacy assessment, which is generally regarded as part of a conventional
phase II clinical study, and therefore the HX009-I-01 meets the core product eligibility
requirements under Chapter 2.3 of the Guide.
Furthermore, in February 2025, NMPA granted us the phase IIa clinical study approval for
HX009 in combination with trastuzumab for the treatment of advanced TNBC. (the “ HX009
NMPA TNBC Combination Approval ”), which allows us to conduct clinical trials of HX009
with trastuzumab for treatment in patients with unresectable or metastatic TNBC with low or
ultra-low HER2 expression who have previously received first- or second-line systemic
therapy. No additional approval is needed before we proceed to carry out the confirmatory
clinical studies or pivotal-stage clinical studies. The HX009 NMPA TNBC Combination
Approval also provided that, after completing the exploratory clinical studies and before
carrying out the confirmatory clinical studies or pivotal-stage clinical studies, the applicant
shall apply to CDE for a communication meeting to evaluate subsequent clinical studies.
FDA
In April 2023, we filed an IND application with FDA for our Phase Ib/II study to be
conducted in the U.S., which is a single-arm, multi-center, open-label Phase Ib/II clinical study
of HX009 in patients with DLBCL. In May 2023, we received the Study May Proceed approval
from FDA (the “ FDA Approval ”) with non-holding clinical suggestions, which suggested that
the proposed sample size in Phase Ib (up to 10 patients at each dose level) may not be adequate
to support an integrated analysis on PK, PD, safety and efficacy data to select RP2D for Phase
II part of the study. We may need additional dose exploration beyond the initial dose escalation
phase, such as including additional patients in the dose escalation part of the study or consider
additional dose expansion cohorts, before initiating Phase II part of the trial. Subsequently, we
updated the protocol and submitted the summary of changes to FDA in June 2023. We expect
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to proceed the relevant clinical studies in the U.S. in accordance with the updated protocol
when we commence the relevant clinical studies. As of the Latest Practicable Date, we had no
plan to commence the relevant clinical studies in the U.S..
In addition to the communications as disclosed above, we have also sent annual
development safety update report to NMPA and FDA every anniversary of our NMPA/IND
clearance date, and we are not aware of any material concern from the NMPA or the FDA in
connection with HX009.
Preclinical Studies of HX009
Teff cells within the tumor microenvironment are the prominent immune cells to kill
tumor cells thus protecting human body from cancers, which is a process called cancer immune
surveillance. However, tumor cells often escape from the immune surveillance by over-
expressing PD-L1, which binds to PD-1 on Teff cells and inhibits their tumor killing functions.
Conventional PD-1 or PD-L1 blockades have been broadly used to activate Teff cells to kill
tumors. Unfortunately, a remarkable percentage of cancer patients are refractory or resistant to
PD-1 or PD-L1 blockades due to unsatisfying activations of Teff cells. Besides PD-1,
literatures showed that Teff cells also simultaneously express CD47, which interacts with
SIRP /H9251on macrophages or dendritic cells. HX009, a PD-1/SIRP /H9251bispecific antibody, is
capable of cooperatively binding to PD-1 and CD47 on Teff cells at the same time with stronger
avidity than conventional PD-1 blockades, for example, pucotenlimab, pembrolizumab,
nivolumab, etc., which eventually results in stronger activation of Teff cells. As anticipated,
our data demonstrated that HX009 induced about three-folds stronger activation of Teff cells
than pucotenlimab in vitro . In addition, HX009 exhibited significantly stronger anti-tumor
activities than pucotenlimab in an A20 mouse lymphoma tumor model in vivo . Taken together,
these results imply that HX009 would potentially have better anti-tumor effects in cancer
patients who are not responding to current PD-1 blockades. Moreover, since HX009 is also able
to inhibit the CD47/SIRP /H9251interactions, HX009 could robustly inhibit tumor growth of a
variety of lymphoma/leukemia tumor models which overexpress CD47, suggesting a potential
application of HX009 for treating hematological malignancies. Details as set forth below were
published on www.nature.com/scientificreports, namely, “ Preclinical pharmacology
characterization of HX009, a novel PD1/CD47 Bi-specific antibody ” and “ HX009, a novel
BsAb dual targeting PD1/CD47, demonstrates potent anti-lymphoma activity in preclinical
models ”.
As illustrated in chart T-cell Activation Reporter Assay below, in our T cell activation
reporter assay, HX009 induced about three times more T cell activation than HX008, which is
an anti-PD-1 mAb. Remarkably, this enhanced T cell activation can be neutralized by adding
anti-SIRP /H9251antibody with high affinity to SIPR /H9251, which suggests that the additional T cell
activation by HX009 is likely a result of cis-binding to PD-1 and CD47 on the reporter cell
surface. However, the additional T cell activation cannot be blocked by adding soluble
CD47-Fc, implying that HX009 with weakened binding to CD47 cannot be competed by
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soluble CD47-Fc. Taken together, this assay demonstrated that HX009 is capable of inducing
stronger T cell activation than anti-PD-1 mAb alone via additional PD-1-driven, cis-binding to
surface PD-1 and CD47 on T cells.
As illustrated in chart A20-hCD47 Tumor Growth in hPD-1/hPD-L1/hCD47/hS1RPd
HuGEMM Mice below, in hPD-1/hPD-L1/hCD47/hSIRP /H9251HuGEMM mice bearing human
CD47-expressing A20-hCD47 B-lymphoma tumor cells, treatment with human SIRP /H9251-Fc at 8.8
mg/kg led to moderate anti-tumor effects, whereas treatment with HX008, an anti-human PD-1
monoclonal antibody exhibited little anti-tumor effects. In contrast, treatment with HX009, a
bispecific antibody targeting both PD-1 and CD47 at 10 mg/kg induced significant anti-tumor
effects, which are stronger than either HX008 or human SIRP /H9251-Fc alone. Therefore, HX009
evidenced better efficacy than HX008 in the preclinical model.
T-Cell Activation Reporter Assay
0.01 0.1 1 10 100
0
1×105
2×105
3×105
Conc.(nM)
Luminescence Units
HX009 + anti-SIRP/g68 (1:3) EC50 = 1.249 nM
HX008    EC50 = 1.028 nM
HX009    EC50 = 0.4391 nM
HX009 + CD47-hFc (1:3) EC50 = 0.5296 nM
0 5 10 15
0
1000
2000
3000Mean Tumor Volume (mm3)
G4 TGI = 79.48% (D14)
G3 TGI = -6.31% (D14)
G2 TGI = 42.21% (D14)
A20-hCD47 Tumor Growth in
hPD-1/hPD-L1/hCD47/hSIRPα HuGEMM Mice
G1, Vehicle, BIW
G2, hSIRP/g68-Fc, 8.8 mg/kg, BIW
G3, HX008, 8.6mg/kg, BIW
G4, HX009, 10mg/kg, BIW
Days after treatment
Source: Company data
Clinical Studies of HX009
We own the worldwide development and commercialization right of HX009. During the
Track Record Period and up to the Latest Practicable Date, we have completed the Phase I
clinical trial of HX009 in Australia and China, separately. In Australia, it is a first-in-human
study evaluating the safety, tolerability, and initial efficacy of HX009 in patients with advanced
malignancies (the “ HX009-I-01 Australia Study ”); and in China, it is a standalone phase Ia
clinical study to evaluate the safety and tolerability of HX009 in patients with advanced solid
tumor (the “ HX009-I-01 China Study (Phase Ia) ”, which is also a conventional phase I study.
As of the Latest Practicable Date, there are three clinical trials ongoing in China, namely, the
HX009-I-01 China Study (Phase Ib), the HX009-II-02 China Study (Phase I/II) and the
HX009-II-05 China Study (Phase IIa). The HX009-I-01 China Study (Phase Ib) is designed to
further evaluate the safety and tolerability of HX009 in patients with advanced melanoma and
to preliminarily measure its anti-tumor efficacy. The HX009-II-02 China Study is a
multicenter, single-arm, open Phase I/II clinical trial in patients with R/R lymphoma, involving
Phase Ia as a dose-escalation phase and Phase Ib/II as a phase of efficacy exploration and
confirmation.
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Currently, we do not plan to conduct head-to-head studies for our HX009 as head-to-head
trial usually refers to a comparison between the control group (existing standard treatment) and
the experimental group, where the drugs administrated shall be in the same category (for
example, mAb, BsAb, etc.) for the purpose of efficacy comparison, and whether a head-to-head
trial is required by the competent authority generally depends on the standard treatment for the
targeted indication. For the targeted indications and treatment line of HX009, there is a lack
of standard treatment at this stage, therefore, we do not expect head-to-head studies to be
required by the competent authorities for its current targeted indications.
HX009-I-01 Australia Study
The HX009-I-01 Australia Study is a first-in-human Phase I clinical trial, which involves
an open-label, “3+3” dose escalation study. The HX009-I-01 Australia Study was designed to
evaluate the safety, tolerability and initial efficacy of HX009 in patients with advanced
malignancies, and has been conducted in accordance with the International Conference on
Harmonization Good Clinical Practice (the “ ICH GCP ”).
The HX009-I-01 Australia Study was divided into screening period (28 days before first
dose), treatment period, and survival follow-up period. Treatment period lasted until the
subject either developed an intolerable toxicity, withdrew consent, developed progression of
disease (PD), died, was lost to follow-up, or had received study treatment for 24 months;
whichever occurred first. After discontinuing study treatment for any reason (other than death),
subjects were to return to the study site to complete the end of treatment/early withdrawal
(EOT/EW) examination within 28±7 days. The study duration was until all subjects died or a
minimum of 24 months after the last subject was enrolled, whichever occurred first.
The key inclusion criteria for subjects in the HX009-I-01 Australia Study include, among
others, (i) Eastern Cooperative Oncology Group performance status of 0 to 1; (ii) histologically
confirmed advanced malignant tumor that is refractory/relapsed to standard therapies, or for
which no effective standard therapy is available, or the subject refuses standard therapy; (iii)
at least 1 measurable tumor according to RECIST v1.1; and (iv) adequate organ function,
laboratory test results meet the protocol requirements, within seven days before signing
informed consent. The key exclusion criteria for subjects in the HX009-I-01 Australia Study
include, among others, (i) prior malignancy active within the previous two years except for the
tumor for which a subject is enrolled in the study and locally curable cancers that have been
apparently cured, such as basal or squamous cell skin cancer, superficial bladder cancer or
carcinoma in situ of the cervix or breast; (ii) allergic to recombinant humanized anti-PD-1
monoclonal antibody drugs and their components; (iii) receipt of any immunotherapy, or
investigational anticancer therapy within four weeks prior to the first dose of study treatment;
in the case of mAbs (for investigational use or immunotherapy), six weeks prior to the first
dose of study treatment; and (iv) tests positive for human immunodeficiency virus, or has
active hepatitis B virus or hepatitis C virus.
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We have completed observations of the HX009-I-01 Australia Study after assessing the
following seven representative dosage levels in the total enrolled 21 patients with solid tumor:
0.1 mg/kg (n=2), 0.3 mg/kg (n=3), 1.0 mg/kg (n=3), 2.0 mg/kg (n=3), 3.0 mg/kg (n=3), 5.0
mg/kg (n=3) and 7.5 mg/kg (n=4). On October 25, 2022, principal investigator of the
HX009-I-01 Australia Study issued the Clinical Study Report (the “ HX009-I-01 Australia
CSR”), where the principal investigator assessed the clinical results from the HX009-I-01
Australia Study, and based on the HX009-I-01 Australia CSR, below sets forth comments on
HX009’s quality safety, PK, and preliminary efficacy data:
 Safety: All seven dose levels of HX009 were well tolerated and no DLT was observed
across the seven tested dose levels. No fatal TEAEs or TEAEs leading to study
discontinuation were reported.
 PK: The plasma PK profile of HX009 indicated a dose-proportional increase in systemic
exposure following a single intravenous infusion; drug accumulation was minimal
following six treatment cycles. Clearance was similar across the dose range, which is also
indicative of dose proportionality.
 Efficacy: All 21 treated subjects were evaluable for efficacy, among which, three subjects
were responders. Two subjects in the 5.0 mg/kg group achieved complete response, and
one subject in the 1.0 mg/kg group achieved partial response. These three responders were
followed up for 1.5 to 2 years in the study. The observed responses were durable, and the
median duration of response was not reached. Median progression-free survival was 64
days based on RECIST V ersion 1.1 and the median overall survival was 212 days.
The chart below sets forth waterfall plot of the maximal percentage change in the size of
target lesions from baseline (full analysis set):
001-6002002-5003002-2002002-3002003-7004002-5002002-4001002-5001001-4001002-1001003-7001003-4001002-2001002-3001001-2001003-7003002-3003003-6002003-6003
100 CC
PC
EC
Dose Level:
CC CC
CC
MEM SCC SCC
EC
BC
BC
CC
GC TNBC HNSCC
OC
RC GJA
80
60
40
20
-20
-40
-60
-80
-100
0
Change from Baseline (%)
Subject
7.5 mg/kg5.0 mg/kg3.0 mg/kg2.0 mg/kg1.0 mg/kg0.3 mg/kg0.1 mg/kg
BC=Breast Cancer
CC=Colorectal Cancer
EC=Endometrial Cancer
GC=Gallbladder Cancer
GJA=Gastroesophageal Junction
Adenocarcinoma
HNSCC=Head and Neck Squamous
Cell Carcinoma
MEM=Malignant Epithelioid
Mesothelioma
OC=Ovarian Cancer
PC=Pancreatic Cancer
RC=Rectosigmoid Cancer
SCC=Squamous Cell Carcinoma
TNBC=Triple Negative Breast Cance
r
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The chart below sets forth swimmer plot of duration of exposure, tumor response, and
survival status by RECIST V ersion 1.1 (full analysis set):
001-1001
002-1001
002-2002
001-2001
002-2001
002-3002
002-3003
002-3001
001-4001
Subject
Study Day
0
Dose Level: 0.1 mg/kg 0.3 mg/kg
Treatment duration:
1.0 mg/kg 2.0 mg/kg 3.0 mg/kg 5.0 mg/kg 7.5 mg/kg
90 180 270 360 450 540 630 720
Tumour Response RECIST 1.1:
CR
PR
SD
PD
Dead
Alive
810 900
001-6002
003-6003
003-6002
003-7004
003-7001
001-7001
003-7003
003-4001
002-4001
002-5003
002-5001
002-5002
Source: Company data
HX009-I-01 China Study
The HX009-I-01 China Study is an open-label, multi-center, multiple-dose administration
clinical study, which involves a standalone Phase Ia clinical study that is a conventional Phase
I clinical trial and a Phase Ib study. The HX009-I-01 China Study was designed to evaluate the
safety, tolerability and initial efficacy of HX009 in patients with advanced solid tumor, and has
been conducted in accordance with the International Conference on Harmonization Good
Clinical Practice (the “ ICH GCP ”).
The HX009-I-01 China Study was divided into screening period (28 days before first
dose), treatment period, and survival follow-up period. Treatment period lasted until the
subject either developed an intolerable toxicity, developed progression of disease (PD), started
new anticancer treatment, died, was lost to follow-up, withdrew consent, investigator assessed
the risk out-weighted benefits, end of study; or, for Phase Ib subjects, had received study
treatment for 24 months; whichever occurred first.
We commenced the HX009-I-01 China Study under the NMPA Umbrella Approval, and
the first subject was enrolled for Phase Ia of the HX009-I-01 China Study in June 2020. We
have completed observations of Phase Ia of the HX009-I-01 China Study after assessing the
following seven representative dosage levels in the total enrolled 25 patients with solid tumor:
0.3 mg/kg (n=4), 1.0 mg/kg (n=3), 2.0 mg/kg (n=3), 3.0 mg/kg (n=3), 5.0 mg/kg (n=3), 7.5
mg/kg (n=3) and 15.0 mg/kg (n=6).
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The key inclusion criteria for subjects in the Phase Ia of the HX009-I-01 China Study
include, among others, (i) Eastern Cooperative Oncology Group performance status of 0 to 1;
(ii) histologically confirmed advanced malignant tumor that is refractory/relapsed to standard
therapies, or for which no effective standard therapy is available, or the subject refuses
standard therapy; (iii) at least 1 measurable tumor according to RECIST v1.1; and (iv) adequate
organ function, laboratory test results meet the protocol requirements, within seven days before
signing informed consent. The key exclusion criteria for subjects in the Phase Ia of the
HX009-I-01 China Study include, among others, (i) prior malignancy active within the
previous five years except for cured basal cell skin cancer, or carcinoma in situ of the cervix;
(ii) allergic to recombinant humanized anti-PD-1 monoclonal antibody drugs and their
components; (iii) severe infections within four weeks before the first administration of the
study drug, or those with active infections requiring oral or intravenous antibiotic treatment
within two weeks before the first administration of the study drug; and (iv) tests positive for
human immunodeficiency virus, or has active hepatitis B virus or hepatitis C virus.
During the Track Record Period, we completed the standalone Phase Ia clinical study of
the HX009-I-01 China Study, which is a conventional Phase I study to evaluate the safety and
tolerability of HX009 in patients with advanced solid tumors and to preliminarily measure its
anti-tumor efficacy, and principal investigator of the HX009-I-01 China Study (Phase Ia) has
issued the clinical study report dated July 24, 2024.
Based on the clinical results in the dose-escalation cohort ranging from 0.3 mg/kg to 15.0
mg/kg (Phase Ia), one case of DLT (Grade 3 anemia) was observed in the 15 mg/kg cohort,
which did not reach the MTD. Among the 23 subjects who had at least one post-baseline tumor
assessment, one patient with TNBC in the 3 mg/kg dose level achieved a partial response, with
the response duration exceeding 2.5 years; eight subjects achieved stable disease. No fatal
TEAEs or TEAEs leading to study discontinuation were reported. The study results suggest
that a dose range of 1.0 mg/kg to 15.0 mg/kg every two weeks is safe and potentially effective
for monotherapy with HX009, supporting the continuation of clinical research to further
explore the efficacy and safety of HX009 as a monotherapy or in combination with other
treatments for advanced solid tumors.
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The chart below sets forth waterfall plot of the maximal percentage change in the size of
target lesions from baseline (full analysis set):
BC
BC
OC RCCNSCLC
NSCLC
Best Change in Target Lesions Diameter %
Subject ID
5mg/kg 7.5mg/kg 15mg/kg0.3mg/kg 1mg/kg 2mg/kg 3mg/kg
BC=Breast Cancer
BC
BC
BC
GC BC
BC BC
BC GC
CRC
NSCLC
OC CCA
MM NSCLC=Non-Small Cell Lung Cancer
CRC=Colorectal Cancer
OC=Ovarian Cancer
GC=Gastric Cancer
CCA=Cholangiocarcinomas
MM=Malignant Melanoma
RCC=Renal Cancer
EC=Esophageal Cancer
125
100
75
50
25
0
-25
-50
-75
-100
S03004S02025S02017S01005S02009S02005S02012S02020S03001S01001S02021S01008S02002S02003S02019S02011S02007S01006S02010S01004
The chart below sets forth swimmer plot of duration of exposure, tumor response, and
survival status by RECIST V ersion 1.1 (full analysis set):
S01004
S02018
S01008
S02023
S02002
S01006
S02019
S02026
S02007
S01001
S02011
S01005
S02020
S02010
S02021
S03004
S02009
S02005
S02003
S02012
S02025
S02017
S03001
0 90 180 270 360 450 540 600 720 810 900 990 1080
Subject ID
1mg/kg 15mg/kg 2mg/kg3mg/kg 5mg/kg 7.5mg/kg 0.3mg/kg
Time since the date of first dose (Day)
PR (Partial Response)
SD (Stabilization of Diseases)
PD (Progress of Disease)
Continue Treatment
Completion/Exit of Pilot
Source: Company data
There were three long-term responder and/or patients whose diseases have been stable
under treatment for long period of time in Phase Ia of the HX009-I-01 China Study. For the best
of patient’s interest and ethical reason, Phase Ia of the HX009-I-01 China Study was kept open
to allow such patients being treated in the study with HX009. In addition, we would like to
collect all patient’s data including such long-term responder. Therefore, Phase Ia of the
HX009-I-01 China Study was kept open (i.e., no database-lock) for approximately four years,
and it was completed in July 2024 when the clinical study report was issued. Meanwhile,
despite that Phase Ia of the HX009-I-01 China Study was kept open for the above reasons, dose
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escalation of Phase Ia of the HX009-I-01 China Study was completed in September 2022, and
it obtained its safety conclusion and reached the endpoints in April 2023, and the NMPA has
no objection for proceeding with the Phase Ib clinical trial.
We further proceeded to conduct Phase Ib of the HX009-I-01 China Study starting at 10
mg/kg dose level in patients with advanced melanoma, which is designed to be a single-arm,
multi-center, multi-cohort and open-label clinical study. This study includes two cohorts for
first line treatment (Cohort A) and second line and above treatment (Cohort B) of patients with
advanced melanoma. In November 2023, the first subject was enrolled for this study. As of the
Latest Practicable Date, a total of 46 subjects (including 27 patients for Cohort A and 19
patients for Cohort B) were enrolled into this study and received HX009 treatment at 10 mg/kg
dose level. They are patients with unresectable or metastatic advanced melanoma that are
previously untreated (Cohort A) or progressed (Cohort B) on PD-1/PD-L1 therapy. HX009 has
shown preliminary therapeutic benefits in patients with advanced melanoma. Currently, the
study is ongoing and we plan to enroll no more than 80 patients for this study.
During the DSUR reporting period from July 18, 2023 to July 17, 2024, in Phase Ib of
the HX009-I-01 China Study, there were three fatal cases which were assessed by the
investigator as unrelated to the investigational product and concluded as progressive disease.
As of the Latest Practicable Date, Phase Ib of the HX009-I-01 China Study was still ongoing
under the normal observation process of the clinical trials, and no safety-related measures were
taken by the regulatory authorities or ethics committees that had a significant impact on the
conduct of such clinical trials. For risk factors relating to fatal cases, please refer to “Risk
Factors — Risks Relating to the Research and Development of Our Drug Candidates —
Adverse events or undesirable side effects caused by our drug candidates could interrupt, delay
or halt clinical trials, delay or prevent regulatory approval, limit the commercial profile of an
approved drug, or result in significant negative consequences following any regulatory
approval” in this prospectus.
HX009-II-02 China Study
We conduct further clinical trials of HX009 under the HX009 NMPA Umbrella Approval.
In October 2021, the Ethics Committee of the leading investigator site accepted our Phase I/II
study for HX009 in patients with R/R lymphoma (the “ HX009-II-02 China Study ”). In July
2022, members of the Data Monitor Committee (the “ DMC”) of the HX009-II-02 China Study
unanimously confirmed that treatment with HX009 in the HX009-II-02 China Study was safe
when administered at doses up to 7.5 mg/kg every two weeks. In October 2022, members of
the DMC unanimously confirmed that the dose escalation stage of HX009-II-02 China Study
was completed and the study can be proceeded to the efficacy exploration stage, which
involves the enrollment of subjects at 10 mg/kg dose level and may explore at the 15 mg/kg
dose level as appropriate. As of the Latest Practicable Date, a total of 41 subjects were enrolled
into the Phase Ib of the HX009-II-02 China Study at dose level of 10 mg/kg, among which
20 subjects are with R/R EBV
+ NHL. As of the same date, there were four R/R EBV + NHL
patients achieved partial response and five R/R EBV + NHL patients achieved stable disease.
The objective response rate is 20.0% and the disease control rate is 45.0%. Overall, HX009 is
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providing meaningful clinical benefit to this difficult to treat patient population. Currently, we
have completed database lock for the HX009-II-02 China Study, and expect to complete this
study with clinical study report by the end of 2025.
The HX009-II-02 China Study was divided into screening period (28 days before first
dose), treatment period, and survival follow-up period. Treatment period lasted until the
subject either died, was lost to follow-up, withdrew consent, investigator assessed the risk
out-weighted benefits, whichever occurred first.
The key inclusion criteria for subjects in the HX009-II-02 China Study include, among
others, (i) diagnosed with lymphoma according to the fifth edition of the WHO classification
standards in 2022, and meets the definition of relapsed/refractory; (ii) within four weeks prior
to the first dose, there must be at least one measurable lesion according to the Lugano criteria;
Measurable lesions: the longest diameter of lymph nodes >15mm, other involved lesions
>10mm; Lesions that have previously undergone local treatments such as radiotherapy, if
proven to have disease progression and meet the definition of measurable lesions, are
considered measurable lesions; and (iii) suitable organ and hematopoietic function, meeting the
requirements of the protocol. The key exclusion criteria for subjects in the HX009-II-02 China
Study include, among others, (i) known history of hereditary or acquired hemolytic or bleeding
disorders; (ii) prior malignancy active within the previous five years except for cured basal cell
skin cancer, or carcinoma in situ of the cervix; (iii) subjects with primary or secondary central
nervous system lymphoma; and (iv) previously received targeted therapy against CD47
(including mAb, BsAb, etc.).
During the DSUR reporting period from July 18, 2022 to July 17, 2023 and till the end
of 2023, in the HX009-II-02 China Study, there was one fatal case, which was died from viral
myocarditis. The investigator assessed this death as unrelated to the investigational product.
The subject, a patient with relapsed/refractory lymphoma, was in terminal condition at the time
of trial entry and had contracted COVID-19, which subsequently triggered a cascade of
inflammatory responses leading to death. The HX009-II-02 China Study were still ongoing
under the normal observation process of the clinical trials, and no safety-related measures were
taken by the regulatory authorities or ethics committees that had a significant impact on the
conduct of such clinical trials.
HX009-II-05 China Study
Leveraging the promising preliminary anti-tumor activity of HX009 as implicated in
preclinical studies and observed in phase I studies, we venture into combination with tumor
micro-environment remodeling agent to further amplify its therapeutic potential.
Looking ahead, the clinical research roadmap for HX009 includes two additional phase II
combination studies. In June 2024, we submitted a combination study IND of HX009 to
NMPA, which is a Phase IIa clinical study application for the combination treatment of HX009
with a pivotal trial stage (Stage III) FAKi drug in patients with advanced malignant BTC and
melanoma (i.e., the HX009-II-05 China Study).
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The IND application we submitted included clinical data from four clinical studies: (i) the
HX009-I-01 Australia Study, a completed phase I clinical trial; (ii) the HX009-I-01 China
Study (Phase Ia), a completed phase I clinical trial; (iii) the ongoing HX009-I-01 China Study
(Phase Ib) for treatment of; and (iv) the HX009-II-01 China Study for treatment of advanced
solid tumor. This HX009-II-01 China Study was terminated in the early stage due to the change
in our clinical development strategy.
We obtained clinical study approval from NMPA in September 2024, and enrolled first
patient in January 2025. As of the Latest Practicable Date, there were no approved FAKi
targeting BTC on the market, and obtain NDA market approval on our HX009 for the treatment
of BTC relies on the successful market development of this drug. As of the Latest Practicable
Date, there were nine patients enrolled for this HX009-II-05 China Study, and they are patients
with previously treated unresectable or metastatic advanced biliary tract cancer. As of the same
date, four among the nine enrolled patients achieved stable disease. Currently, the study is
ongoing and we plan to enroll no more than 30 patients for this study.
Regarding the HX009-II-05 China Study, the drug used in this study is a FAK inhibitor,
which is under the pivotal-stage study development by InxMed Biotech Co., Ltd. (Shanghai)*
(Ҧ(ɪऎ)ʮ̡, the “ InxMed Shanghai ”), a clinical-stage biotech company
established in 2018 that focuses on developing FAK inhibitors. On February 5, 2024, Hangzhou
Hanx entered into a cooperation agreement with InxMed Biotech Co., Ltd. (Nanjing)* ( Ꮠ˰
Ҧ(ԯ)ʮ̡, the “ InxMed Nanjing ”, which is the sole shareholder of InxMed
Shanghai) regarding the combination study of HX009 and their FAKi drug. The agreement
provided that (i) parties shall provide their respective products (i.e., HX009 and FAKi) to the
other party free of charge in a timely manner during the first cooperation stage, which covers
till the phase Ib/II of the combination study (including dose escalation and indication
expansion); (ii) parties shall negotiate in good faith and may reach a supplement agreement to
further agree upon on each other’s rights and obligations in the second cooperation stage,
which covers the pivotal trial stage of the combination study and till 15 years after the market
approval of the combination therapy. As of the Latest Practicable Date, there are no approved
FAK inhibitors targeting BTC. Therefore, we decided to combine with a pivotal-stage drug. We
do not expect to incur actual cost (except for labelling, storage and shipment fees) for this
FAKi drug as InxMed shall provide this FAKi drug pursuant to our cooperation agreement.
Currently, this FAKi drug is under the pivotal-stage (Stage III) study development, and
obtaining NDA market approval on our HX009 for the treatment of BTC relies on the
successful market development of this drug.
Summary of Safety Data from Phase I Clinical Trials in Australia and China
During the Track Record Period, we conducted two Phase I clinical trial programs of our
Core Product HX009 in Australia and China, namely, the HX009-I-01 Australia Study (Phase
I) and HX009-I-01 China Study (Phase Ia). There are 21 and 25 patients enrolled for the
HX009-I-01 Australia Study (Phase I) and HX009-I-01 China Study (Phase Ia) respectively,
and we completed the last patient last visit for these two clinical studies in May 2022 and
February 2024, respectively.
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The table below sets forth the summary of frequently reported treatment-related
treatment-emergent adverse events by preferred term in Phase I trials of HX009 in Australia:
Summary of Treatment-Related Treatment-Emergent Adverse Events by Preferred Term
Preferred Term
0.1 mg/kg
(N=2)
0.3 mg/kg
(N=3)
1.0 mg/kg
(N=3)
2.0 mg/kg
(N=3)
3.0 mg/kg
(N=3)
5.0 mg/kg
(N=3)
7.5 mg/kg
(N=4)
All Subjects
(N=21)
At least one IP-related TEAE /H1118/H1118/H1118/H1118/H11180313112 1 1 (52.4%)
Nausea /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180000101 2 (9.5%)
Rash /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180100010 2 (9.5%)
V omiting /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180001100 2 (9.5%)
Alanine aminotransferase increased /H1118/H11180001000 1 (4.8%)
Anaemia /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180000001 1 (4.8%)
Aspartate aminotransferase increased /H1118 0001000 1 (4.8%)
Cellulitis /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180001000 1 (4.8%)
Decreased appetite /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180100000 1 (4.8%)
Diarrhoea /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180000100 1 (4.8%)
Dry mouth /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180000001 1 (4.8%)
Dyspnoea /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180000001 1 (4.8%)
Fatigue /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180010000 1 (4.8%)
Hyperhidrosis /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180001000 1 (4.8%)
Hypothyroidism /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180000010 1 (4.8%)
Infusion related reaction /H1118/H1118/H1118/H1118/H1118/H1118/H11180000001 1 (4.8%)
Lethargy /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180100000 1 (4.8%)
Mucosal inflammation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180100000 1 (4.8%)
Note: When calculating the corresponding number of adverse events, only one person is counted if the subject has
multiple adverse events in one SOC or PT classification.
The majority of subjects had treatment-related treatment-emergent adverse events that
were Grade 1 to 2 in severity. One subject in the 7.5 mg/kg group had a Grade 3
treatment-related treatment-emergent adverse event of infusion-related reaction, and the study
treatment on this particular subject was discontinued due to the adverse event. This event
resolved seven days. There was no safety concern or condition imposed by the regulatory
authorities, nor any adjustments made to the endpoints or extension of the HX009-I-01
Australia Study required by regulatory authorities.
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The table below sets forth the summary of frequently reported Grade /H113503 treatment-
related adverse events by preferred term (safety analysis set) in Phase Ia trials of HX009 in
China:
Grade /H113503 TRAEs
Preferred Term
0.3 mg/kg
(N=4)
1 mg/kg
(N=3)
2 mg/kg
(N=3)
3 mg/kg
(N=3)
5 mg/kg
(N=3)
7.5 mg/kg
(N=3)
15 mg/kg
(N=6)
All Subjects
(N=25)
At least one Grade /H113503 TRAE /H1118/H1118/H1118/H1118/H11180 1 (33.3%) 0000 1 (16.7%) 2 (8.0%)
Liver injury /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180 1 (33.3%) 00000 1 (4.0%)
Decrease in white blood cell count /H1118/H11180 1 (33.3%) 00000 1 (4.0%)
Anemia /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118000000 1 (16.7%) 1 (4.0%)
Note: When calculating the corresponding number of adverse events, only one person is counted if the subject has
multiple adverse events in one SOC or PT classification.
Three TEAEs leading to subject withdraw from the study were reported in the
HX009-I-01 China Study (Phase Ia). The table below sets forth the summary by preferred term
(safety analysis set):
TEAEs Leading to Subject Withdraw from the Study
Preferred Term
0.3 mg/kg
(N=4)
1 mg/kg
(N=3)
2 mg/kg
(N=3)
3 mg/kg
(N=3)
5 mg/kg
(N=3)
7.5 mg/kg
(N=3)
15 mg/kg
(N=6)
All Subjects
(N=25)
At least one TEAE leading to subject
withdraw from the study /H1118/H1118/H1118/H1118/H1118/H11181 (25.0%) 1 (33.3%) 1 (33.3%) 0000 3 (12.0%)
Liver injury /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180 1 (33.3%) 00000 1 (4.0%)
Lung inflammation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180 0 1 (33.3%) 0000 1 (4.0%)
Intestinal obstruction /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181 (25.0%) 000000 1 (4.0%)
Note: When calculating the corresponding number of adverse events, only one person is counted if the subject has
multiple adverse events in one SOC or PT classification.
Clinical Development Plan of HX009
For the years ended December 31, 2023 and 2024 and the eight months ended August 31,
2024 and 2025, we incurred research and development costs for our Core Product of RMB13.5
million, RMB19.4 million, RMB17.6 million and RMB19.4 million, respectively, which
accounted for 29.0%, 25.9%, 30.9% and 34.5% of our total research and development expenses
during the same periods, respectively. The clinical trials of HX009 has been marked by
significant milestones, with two phase I dose escalation clinical trials successfully concluded
in Australia and China. These trials, known as HX009-I-01 Australia Study and HX009-I-01
China Study (Phase Ia), were pivotal in understanding safety and optimal dosage levels of
HX009. The completion of these trials has provided a solid foundation for the subsequent
phases of research and development.
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Currently, we are focusing on the ongoing clinical trials of HX009 conducted in China.
One is the HX009-I-01 China Study (Phase Ib), which is a phase Ib clinical trial that comprises
of two cohorts with one cohort specifically targets advanced melanoma patients who were
disease progression after prior treatments involving PD-1/PD-L1 inhibitors. This study is a
testament to the ongoing efforts to find effective treatments for patients with this aggressive
form of skin cancer. The other clinical program, the HX009-II-02 China Study, is a
multi-center, open-label, single-arm Phase I/II clinical trial. It is designed to assess the safety
and efficacy of HX009 in Chinese patients with R/R lymphoma (including R/R EBV
+ NHL).
This study is significant as it aims to provide a new therapeutic option for patients with this
type of blood cancer. Furthermore, we commenced the HX009-II-05 China Study (Phase IIa)
for treatment of advanced biliary tract cancer with first patient enrolled in January 2025.
In addition, we submitted a combination study IND of HX009 to NMPA in November
2024, which is a Phase IIa clinical study application for the combination treatment of HX009
with trastuzumab deruxtecan in patients with advanced triple-negative breast cancer (i.e., the
HX009-II-04 China Study). We obtained clinical study approval from NMPA in February 2025
and expect the first patient enrollment for this combination study to be in 2026. Regarding the
combination clinical study with trastuzumab, the brand for the trastuzumab deruxtecan used is
Enhertu
® and was co-developed by a multinational healthcare corporation in Japan and a
multinational pharmaceutical company focused on innovative medicines across multiple
therapeutic areas, including oncology, cardiovascular, and metabolic diseases. Trastuzumab
deruxtecan is included in NRDL since 2024, and according to Frost & Sullivan, the price of
trastuzumab deruxtecan is RMB3,480/100mg in 2025 and there are plenty supply in the market.
As of the Latest Practicable Date, we had not incurred any actual cost for this combination drug
as we have not yet commenced the HX009-II-04 China Study. Our Company is considering two
ways for supply of this drug: (i) to be supplied by one of the co-developers, which is under
negotiation and (ii) to be purchased from other suppliers on the market, and our Company has
reached out to four suppliers to provide this drug. The aim of these studies is to explore the
possibility of enhanced therapeutic effects that may arise from combining HX009 with existing
therapies, potentially offering improved outcomes for cancer patients. These combination
studies underscore a commitment to exploring the full potential of HX009 and its role in future
cancer treatment paradigms.
Market Opportunity and Competition
EBV
+ NHL
EBV+ NHL is a subtype of lymphoma with a specific viral association, and current
treatment options are often limited to chemotherapy and radiotherapy, which are significantly
less effective as compared to EBV
– NHL. The market for HX009 in the treatment of EBV +
NHL presents a niche yet promising opportunity. According to the F&S Report, China
incidence of EBV
+ NHL has increased from 12.1 thousand in 2019 to 13.5 thousand in 2024
with a CAGR of 2.1%. It is estimated to be 15.1 thousand in 2030 and 16.5 thousand in 2035
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with a CAGR of 1.9% and 1.8% respectively. Meanwhile, global incidence of EBV + NHL has
increased from 83.4 thousand in 2019 to 94.2 thousand in 2024 with a CAGR of 2.5%. It is
estimated to be 104.4 thousand in 2030 and 115.0 thousand in 2035 with a CAGR of 1.7% and
2.0% respectively.
Traditional surgery, chemotherapy, and radiotherapy have poor efficacy against these
malignant tumors and can lead to severe adverse reactions. According to the F&S Report,
although approximately 60% to 70% of non-Hodgkin lymphoma (NHL) patients initially
respond to the CHOP or R-CHOP treatments, which are the standard chemotherapy treatments,
approximately 30% to 40% of NHL patients are either refractory to the standard CHOP or
R-CHOP treatments or relapsed after the standard treatments. Currently, there are no specific
drugs targeting EBV
+ NHL on the market. Immune checkpoint inhibitors show potential in
EBV+ NHL. For example, nivolumab appears safe in patients with EBV-associated
lymphoproliferative disorders and NHL without unexpected toxicities in a phase II study. All
these are making R/R NHL is still an unmet medical need and thus a potentially encouraging
market for new therapy development. HX009 stands poised to revolutionize treatment in a
patient cohort with limited treatment options and poor outcomes, fulfilling a crucial market
demand for novel therapeutic solutions. Our translational study results demonstrated that
HX009 could significantly inhibit tumor growth in a large panel of in vivo lymphoma models
and also exhibited enhanced anti-tumor activities compared to PD-1-targeting only or
CD47-targeting only therapies, which is in consistent with published literatures that the
responsiveness to PD-1/PD-L1 treatment can be sensitized by way of blocking CD47.
Moreover, our translational research, together with others, in a large panel of lymphoma
patient-derived tumor xenograft (PDX) models and patient sample data, showed that EBV
+
NHLs expressed high level of PD-L1, CD47 and OX40. In line with this, HX009 also
demonstrated preliminary anti-tumor efficacy in EBV
+ lymphoma in the ongoing phase Ib
clinical study, implying a potential application of HX009 for EBV + lymphoma patients. In
comparison to the first generation of anti-CD47 antibodies (for example, magrolimab) our
preclinical data showed that HX009 is featured with reduced affinity to CD47 thus little
binding to red blood cells and platelets. In addition, the PD-1 targeting drives the affinity that
ensured HX009 specifically and preferentially targets and acts on the exhausted T cells in the
tumor microenvironment, avoiding the antigen sink effect or systemic toxicities associated
with CD47-targeting only therapeutics. In line with our featured design, HX009 exhibited
minimal toxicities in Good Laboratory Practice (GLP) toxicity study as well as the
first-in-human clinical studies, demonstrating HX009 has a broader therapeutic window when
compared to other CD47-targeting therapeutics such as magrolimab.
Melanoma
Melanoma is the most serious type of skin cancer and it can also form in eyes and inside
the body, such as in the nose or throat. The market opportunity for HX009 in treating advanced
melanoma is significant, given the increasing incidence of this aggressive skin cancer globally.
According to the F&S Report, China incidence of melanoma has increased from 8.2 thousand
in 2019 to 9.2 thousand in 2024 with a CAGR of 2.4%. It is estimated to be 10.3 thousand in
2030 and 11.1 thousand in 2035 with a CAGR of 2.0% and 1.5% respectively. Meanwhile,
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global incidence of melanoma has increased from 294.6 thousand in 2019 to 351.6 thousand
in 2024 with a CAGR of 3.6%. It is estimated to be 376.6 thousand in 2030 and 405.2 thousand
in 2031 with a CAGR of 1.2% and 1.5% respectively. According to the F&S Report, from 2019
to 2024, the total melanoma market in China has increased from US$0.2 billion to US$0.3
billion, representing a CAGR of 6.2%. Furthermore, the rapid increase in China’s melanoma
market will continue in the near future. The total melanoma market of China is forecasted to
reach US$0.4 billion in 2035. Meanwhile, the global melanoma market has increased from
US$12.6 billion to US$18.4 billion from 2019 to 2024, representing a CAGR of 7.9%.
Furthermore, the rapid increase in global melanoma market will continue in the near future.
The global melanoma market is forecasted to reach US$23.6 billion and US$27.3 billion by
2030 and 2035 respectively, which represents a CAGR of 4.2% from 2024 to 2030 and a CAGR
of 2.9% from 2030 to 2035.
Melanoma is known for its resistance to traditional therapies, and the market is ripe for
innovative treatments that can improve patient outcomes. Traditional therapies for melanoma
typically include surgery, chemotherapy, and radiation therapy. The occurrence of resistance in
melanoma treated by traditional therapy is attributed to the accumulation of both genetic and
epigenetic alterations to tumor cells and significant changes in their micro-environment. As
major traditional therapies, there are certain limitations that cannot be ignored in the surgery
and chemotherapy. Although several PD-1 blockades, for example, nivolumab (Opdivo) and
pembrolizumab (Keytruda), have been approved as the first-line treatment for melanoma, the
response rate to these PD-1 blockades is remarkably limited. According to the F&S Report, the
traditional cytotoxic drugs for treatment of advanced melanoma maintain a relatively low
effectiveness with an overall response rate of 10% to 15%. Apart from this, a significant
number of melanoma patients relapsed after anti-PD-1 therapy in a relatively short time, which
leaves very limited therapeutic options for relapsed/refractory melanoma. Multiple
combinations of chemotherapy and mono-chemotherapy did not bring significant survival
benefits in advanced melanoma patients. Acral lentiginous melanoma is more common among
Chinese patients than Caucasians. According to the F&S Report, approximately 60% to 70%
of melanoma in China are acral or mucosal melanoma and respond poorly to the current
anti-PD-1 therapies, as opposed to approximately 90% of melanoma in white people are
cutaneous melanoma, which are relatively more responsive to anti-PD-1 therapy. Taken
together, R/R melanoma after anti-PD-1 therapy remains an unmet clinical need, calling for
development of next generation of therapies.
The success of immunotherapies in recent years has demonstrated the potential for novel
approaches to significantly extend survival rates and improve quality of life for patients,
particularly for patients who are not suitable for intensive chemotherapy or have advanced,
unresectable, recurrent disease. HX009, with its unique mechanism of action, could capture a
substantial share of the market with a promising demonstration of superior efficacy and safety
profiles compared to existing treatments. HX009 is characterized with dual targeting of PD-1
and CD47 and our preclinical data showed that HX009 is able to enhance T cell activation by
such a simultaneous targeting of PD-1 and CD47 on T cells in comparison to PD-1-targeting
only or CD47 targeting only reagents, implying a stronger anti-tumor effect over anti-PD-1
antibodies alone. In accordance with this, HX009 demonstrated improved anti-tumor activities
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than HX008 (an anti-PD-1 monoclonal antibody) or Keytruda in a couple of preclinical tumor
models. Taken together, HX009 is expected to provide more clinical benefits for advanced
melanoma patients, especially the acral or mucosal melanoma patients in China. The chart
below illustrates that HX009 showed solid tumor growth inhibition in the human CD47-
expressing A20-huCD47 syngeneic model, while anti-PD-1 antibody or huSIPR /H9251-Fc fusion
protein exhibited little or modest tumor growth inhibition, suggesting that HX009 is of greater
anti-tumor efficacy over anti-PD-1 via additional CD47 targeting.
0 5 10 15
A20-huCD47 (B-Lymphoma)
Days post Treatment
0
1,000
2,000
3,000Tumor Volume (mm3)
Vehicle
huSIRPα-Fc 8.8mpk
Anti-huPD-1 8.6mpk
HX009 10mpk
TGI: 42.21%
TGI: -6.31%
TGI: 79.48%
Biliary Tract Cancer
BTC is the second most common type of liver and bile duct cancer worldwide, typically
comprised of cholangiocarcinomas and gallbladder cancers, patients with ampullary cancer are
also included in some cases. BTC’s most common symptom is jaundice, characterized by a
deep yellow color in the eyes and skin due to bile duct obstruction. BTC is a common
malignant tumor of the biliary system. Early symptoms include abdominal discomfort,
decreased appetite, weight loss, etc. In later stages, symptoms may include jaundice, abdominal
pain, fever, etc. The concealed nature of the gallbladder often leads to late-stage detection,
resulting in a poor prognosis. According to the F&S Report, over 65% of BTC patients are
diagnosed too late for curative surgical resection, resulting in a five-year survival rate of
approximately 5% to 15%. Even among those who undergo surgical treatment, the recurrence
rate within one year remains as high as 67%. According to the F&S Report, the incidence of
BTC in China reached 139.8 thousand in 2024. This number is expected to increase to 161.1
thousand in 2030 and 179.1 thousand in 2035, representing a CAGR of 2.4% between 2024 and
2030 and 2.1% between 2030 and 2035. Meanwhile, global incidence of BTC in 2024 reached
419.1 thousand. It is estimated to rise to 505.0 thousand in 2030 and 582.9 thousand in 2035,
representing a CAGR of 3.2% and 2.9%, respectively.
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Although surgical resection is one of the major effective and curative interventions for
BTC, BTC is very aggressive and over 65% of patients are diagnosed too late for surgical
resection, leading to a five-year survival rate of approximately 5% to 15%. Although BTC is
highly heterogeneous at the genomic, epigenetic, and molecular levels, the genetic mutation
frequencies are relatively low thus constraining the applications of targeted therapies,
such as IDH1 inhibitors, BRAF V600E inhibitors, NTRK inhibitors, etc. Therefore,
Gemcitabine/cisplatin (GC) based treatment regimens remain the standard of care for BTC
patients. Recently, durvalumab (an anti-PD-L1 drug) in combination with chemotherapy
(gemcitabine + cisplatin) has been approved by FDA for treating BTC based on a phase III
TOPAZ-1 trial, however, the median OS in patients with gallbladder cancer received
durvalumab plus chemotherapy was 10.7 months (95% CI, 8.9-13.2) in comparison to 11.0
months (95% CI, 8.7-12.8) in patients received chemo only, therefore, BTC, especially the
gallbladder cancer, remains an unmet medical need. Published literatures showed that
interfering of CD47-SIRP /H9251interaction demonstrated potential uses in the treatment of BTC. In
addition, HX009 has demonstrated encouraging anti-tumor efficacy in a gallbladder cancer
patient (partial response, PR) in the phase I clinical trial, demonstrating a further investigation
of HX009 for the treatment of BTC. Cancer-associated fibroblasts (CAFs) are key cellular
components in tumor stroma and the prominent stromal cells in the tumor microenvironment,
forming a physical barrier to block penetration of anti-tumor drug as well as the leukocytes
infiltration in the TME. BTC is characterized with presence of excessive CAF with the tumor
microenvironment. Published literatures implied that depletion of CAF or blocking the activity
of CAF by FAK inhibitors significantly inhibit the BTC tumor growth and metastasis, likely
via reducing tumor-associated fibrosis, increasing anti-tumor drug penetration and immune cell
infiltration as well as reversing the pro-tumor immunity, which eventually favors potential
combination with immunotherapy. In alignment with this, our translational research results
showed that HX009 in combination with a FAK inhibitor, IN10018, demonstrated great
anti-tumor effects in a “cold tumor” model which doesn’t respond to anti-PD-1 therapy at all,
suggesting that the combination of HX009 with IN10018 could potentially maximize the
anti-tumor activities of HX009 in BTC, particular in gallbladder cancer, where current PD-1
or PD-L1 antibodies (for example, durvalumab) failed to provide clinical benefits. The chart
below illustrates that, in this human CD47-expressing B16F10-hCD47 syngeneic model which
don’t respond to anti-PD-1 therapy, neither HX009 or IN10018, a small molecule FAK
inhibitor inhibited the tumor growth. In contrast, the combo of HX009 and IN10018
demonstrated enhanced anti-tumor activities in comparison to each monotherapy, respectively,
suggesting that HX009 and IN10018 have synergistic anti-tumor effects and this combo might
be of great potential for PD-1 resistant tumors.
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02468 1 0 1 2 1 4
Days post Treatment
0
1,000
2,000
3,000
4,000Tumor Volume (mm3)
B16F10-hCD47 Tumor Growth
Vehicle
HX009 10mpk TGI: 10.36%
IN10018 25mpk TGI: 4.28%
HX009 (10mpk) + IN10018 (25mpk) TGI: 49.11%
As of the Latest Practicable Date, no drug targeting CD47 has been approved for clinical
use and our HX009 is the only CD47 targeted bispecific antibody/bifunctional fusion protein
for advanced melanoma and advanced biliary tract cancer under clinical study globally.
Competitive Advantages
We believe that our Core Product, HX009, has the following competitive advantages:
 Synergistic therapeutic effects through dual-targeting of two immune checkpoint
inhibitors
Our HX009 is designed to target two critical immune checkpoints, PD-1 and CD-47,
simultaneously, with potential to elicit a synergistic therapeutic response. This dual-
targeting mechanism not only enhances the immune system’s ability to recognize and
attack cancer cells but also reduces the likelihood of resistance, which is a common
challenge with single-agent immunotherapies. The bispecific modality is expected to
provide a more robust and sustained anti-tumor response, leading to improved clinical
outcomes for patients. Moreover, the specifically designed bispecific agent is anticipated
to translate to an improved safety profile.
 Novel selection of targets with significant potential
The novel designation for our HX009 signifies its novel mechanism of action, which is
not currently available in the market. This unique position offers HX009 considerable
potential to become the new standard of care in the treatment of various indications
including EBV
+ NHL and advanced melanoma. In particular, we have recently published
an important observation that CD47 and PD-L1 are co-upregulated in EBV + NHL, where
HX009 may likely have more considerable activities. As a promising therapy, HX009 has
the opportunity to fill the gap in the treatment landscape, particularly for patients who
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have exhausted existing treatment options or who are ineligible for current standards of
care. The specifically selected targets also position HX009 favorably in terms of
intellectual property protection and market exclusivity, which could lead to a prolonged
competitive edge and a more attractive value proposition for potential investors and
partners.
 Positive progress of HX009 in multiple clinical programs
HX009’s ongoing clinical programs are demonstrating promising results, which is a
testament to the product’s potential to become a transformative treatment option. The
positive progress across multiple clinical trials indicates that HX009 is safe and well
tolerated, and it has also demonstrated promising efficacy signals in multiple indications
in both solid tumor and hematological indications, hence on track to meet its efficacy
endpoints and safety profiles.
 Global potential for clinical development
HX009 has entered clinical stage for multiple programs, with a promising theoretical and
clinical results of success. In China, we have commenced two clinical trials in multiple
centers, namely, the Phase I Clinical Trial of Tolerability and Pharmacokinetics of HX009
in Patients with Advanced Solid Tumors (China) (the “ HX009-I-01 China Study ”), and
the A Multi-center , Open-label, Single-Arm Phase I/II Clinical Study to Evaluate the
Safety and Efficacy of Recombinant Humanized Anti-CD47/PD-1 Bispecific Antibody
HX009 Injection in Chinese Patients with Relapsed/Refractory Lymphoma (China) (the
“HX009-II-02 China Study ”). As of the Latest Practicable Date, we have completed
Phase Ia of the HX009-I-01 China Study, which is a conventional phase I study to
evaluate the safety and tolerability of HX009 in patients with advanced solid tumors and
to preliminarily measure its anti-tumor efficacy, and PI of the HX009-I-01 China Study
(Phase Ia) has issued the clinical study report dated July 24, 2024. Currently, we are
undergoing the clinical stage of the HX009-II-02 China Study and have obtained positive
preliminary results as of the Latest Practicable Date. In the U.S., we have received the
Study May Proceed Letter from the FDA for HX009 to conduct Phase Ib/II clinical trials
in the U.S. for the DLBCL.
WE MAY NOT BE ABLE TO ULTIMATELY DEVELOP AND MARKET HX009
SUCCESSFULLY.
Key Product — HX301
Overview
HX301 is a novel therapeutic candidate under development, which is designed to target
multiple oncogenic pathways that are critical in the progression of various types of cancer. As
an investigational multi-kinase inhibitor being developed for treating different cancers for its
activities against CSF1R, ARK5, CDK4/6 and FLT-3, HX301 represents a significant
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advancement in targeted cancer therapy, with the potential to address unmet medical needs for
patients with challenging-to-treat malignancies. By targeting these multiple pathways, HX301
aims to overcome resistance mechanisms and provide a more comprehensive therapeutic
approach compared to single-targeted agents.
Mechanism of Actions
The development of HX301 is centered around its unique mechanism of action, which
involves the inhibition of specific kinases that are often deregulated in cancers, leading to
unchecked cancer cell growth and survival. HX301 is a novel multi-target kinase inhibitor that
targets colony-stimulating factor-1 receptor (CSF1R), AMPK-associated protein kinase 5
(ARK5), cell cycle-independent kinase 4/6 (CDK 4/6), and FMS-like tyrosine kinase 3 (FLT-3).
HX301, being a multi-kinase inhibitor, may exert anti-tumor effects by the following MoAs:
(i) inhibition of tumor-infiltrated macrophages by blocking CSF1R, thus blocking the
promotion of tumor growth by tumor-associated macrophages; and (ii) inhibition of tumor cell
proliferation by inhibition of CDK4/6. HX301 shows the highest potency to inhibit CSF1R
with subnanomolar IC
50 in vitro. CSF1R, or M-CSFR (macrophage colony stimulating factor
receptor), is an receptor tyrosine kinase and a member of the same family of kinase as FLT-3,
responsible for the growth, survival and polarization of cells of myeloid lineages. CSF1R is
also often over-expressed, or maybe pathogenic-driven, for example, in acute myeloid
leukemia and/or in tumor associated macrophages such as macrophage/microglia in
glioblastoma tumors, its high expression could potentially be correlated to poorer cancer
prognosis. HX301 can potentially be a candidate for cancer treatments by targeting cancer cell
directly (e.g. acute myeloid leukemia) or indirectly on tumor-associated macrophages. Besides,
as the ability to mobilise across the blood brain barrier is studied and evidenced mainly through
preclinical and/or clinical results, and it was evidenced in preclinical studies that HX301 is
capable of blood-brain barrier penetration with a brain: plasma exposure ratio of about 70%,
suggesting it could also potentially be developed as a promising treatment of glioblastoma, an
aggressive malignancy with huge unmet medical need.
Communications with Regulatory Authorities
NMP A
We submitted a Phase I clinical study protocol (the “ HX301-I-01 China Study
Protocol ”) to NMPA, which followed the ICH GCP and provided that the primary objectives
for this study are to (i) assess the safety and tolerability of HX301; and (ii) determine the MTD
and RP2D of HX301.
The HX301-I-01 China Study Protocol was accepted by NMPA in December 2019, and in
January 2020, NMPA issued the clinical trial approval notification (the “ HX301 NMPA
Umbrella Approval ”) to us, which confirms that HX301 satisfied the relevant requirements of
drug registration, and allows us to carry out clinical trials of this product for advanced solid
tumors according to the NMPA HX301-I-01 Protocol. The HX301 NMPA Umbrella Approval
also confirms that we may adjust our product development strategies and clinical trial protocols
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as appropriate based on the clinical trial development and the clinical trial data obtained, and
may communicate with the relevant regulatory authorities if necessary. In addition, the HX301
NMPA Umbrella Approval provides that (i) after obtaining the permission of the first clinical
trial, the applicant shall regularly provide the Center for Drug Evaluation (the “ CDE”) with
safety update reports during drug research and development, and submit them within two
months after each year; and (ii) after completing the Phase I and Phase II clinical trials and
before carrying out the Phase III clinical trials, the applicant shall apply to CDE for a
communication meeting.
In May 2024, we submitted a combination study IND of HX301 to NMPA, which is a
Phase II clinical study application to evaluate the safety and tolerability of HX301 combined
with temozolomide in the treatment of patients with glioblastoma (i.e., the HX301-II-01 China
Study). We obtained clinical study approval in August 2024, and enrolled first patient in
January 2025.
Clinical Studies and Preclinical Combination Results of HX301
We own development and commercialization right of HX301 in China. During the Track
Record Period, we have completed the Phase I clinical study of HX301 in China, which is a
open-label, multi-center study evaluating the safety, tolerability, and initial efficacy of HX301
in patients with advanced solid tumor (the “ HX301-I-01 China Study ”). We also commit to
promote the combination therapies of HX301 and received the HX301 GBM Combination
Approval, which allows us to carry out clinical studies of HX301 combined with temozolomide
in the treatment of patients with glioblastoma.
In addition to our internal efforts, we are also pursuing global collaborations with
industry-leading business partners. The collaboration with global partners such as Onconova
represents a strong alliance that could significantly expand the therapeutic applications of
HX301 and offer new treatment options for patients suffering from certain type of cancer.
HX301-I-01 China Study
The HX301-I-01 China Study has been conducted in accordance with the International
Conference on Harmonization Good Clinical Practice (the “ ICH GCP ”). Pre-clinical models
and phase I safety and efficacy data demonstrate promising results, underscoring the potential
of HX301 as a therapeutic option for various cancers.
The HX301-I-01 China Study is divided into three phases: (i) the screening period (from
the time subjects sign the informed consent form to 28 days before the first administration of
the drug); (ii) the treatment period (one year); and (iii) the follow-up period (90 days after the
last administration of the drug). Subjects are patients with pathologically confirmed malignant
solid tumors, specifically those with advanced malignant solid tumors (metastatic or
unresectable) who have failed standard treatments (such as targeted therapy, chemotherapy,
biological therapy, immunotherapy, etc.) due to disease progression or intolerance to toxicity,
or those who lack effective treatment options.
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As of January 12, 2024, a total of 20 patients were enrolled in the clinical study, with
varying doses of HX301 administered with the following five dose levels: 40 mg (n=3), 80 mg
(n=3), 120 mg (n=4), 160 mg (n=3) and 200 mg (n=7). As of the Latest Practicable Date, we
have completed the HX301-I-01 China Study, and the principal investigator of the HX301-I-01
China Study has issued the Clinical Study Report (the “ HX301-I-01 China CSR ”) dated July
3, 2024, where the principal investigator assessed the clinical results from the HX301-I-01
China Study. Based on the HX301-I-01 China CSR, below sets forth comments on HX301’s
quality safety, PK, and preliminary efficacy data:
 Safety: Dose-limiting toxicities were observed in two patients in the 200 mg group,
including one case of Grade 4 elevation of alanine aminotransferase and one case of
Grade 3 thrombocytopenia with Grade 2 epistaxis (nosebleed), both of which resolved
after discontinuation of the drug and symptomatic treatment. Two subjects experienced
adverse events related to the study drug that led to permanent discontinuation of the drug,
both in the 200 mg dose group. Four subjects experienced Grade 3 or higher adverse
events related to the study drug, with one case in the 160 mg dose group and three cases
in the 200 mg dose group. There was no clear dose-dependent trend in the incidence and
severity of common adverse events across the different dose groups. The safety results
suggest that HX301 has a manageable overall safety risk within the dose range of 40 mg
to 160 mg, while the 200 mg dose group showed an increased risk of permanent
discontinuation and Grade 3 or higher adverse events. No fatal TEAEs or TEAEs leading
to study discontinuation were reported.
 PK: PK results show that HX301 is rapidly absorbed in the body after oral administration.
The exposure of the main active components, A74-6 and A74-IMP-01, increases with the
dose. The active component A74-6 essentially exhibits linear PK characteristics within
the dose range of 40-120 mg. However, due to individual differences, A74-6 shows
nonlinear characteristics at higher doses such as 160 mg and 200 mg. After multiple
administrations, A74-6 has a weak drug accumulation at each dose level. The active
component A74-IMP-01 essentially exhibits linear PK characteristics within the dose
range of 40 mg to 200 mg, and after multiple administrations, A74-IMP-01 also has a
weak drug accumulation at each dose level.
 Efficacy: Among the 20 patients evaluable for tumor assessment using RECIST V ersion
1.1 by Investigators, four achieved stable disease, including two patients with breast
cancer in the 200 mg group, one patient with breast cancer in the 120 mg group, and one
patient with malignant gastrointestinal stromal tumor in the 80 mg group. One patient
with HR+ breast cancer in the 200 mg group who achieved stable disease was treated for
over a year and achieved prolonged stable disease for more than 12 months.
The efficacy results suggest that there is certain limitations in the efficacy of HX301
monotherapy, but some patients achieved stable disease at doses of 80 mg or higher, and the
duration of stable disease may be longer with higher doses. This provides some clinical benefit
support for subsequent clinical development, especially for the exploration of combination
therapies.
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The chart below sets forth waterfall plot of the maximal percentage change in the size of
target lesions from baseline (full analysis set):
S02002S01002
-10
-5
0
5
10
15
20
25
30
35
40
45
50
55
60
65
70
75
S02007 S01006 S03003 S02004 S02008
40mg 80mg 120mg 160mg 200mg
Subject ID
Dose Group:
Maximum Change from Baseline in Target Lesions Diameter (%)
S02001 S01005 S03004 S03005 S02006 S03002 S03010 S03009
BC
BC
BC BC BC BC
RC
BC
BC
ACC
BC
GIST BC
BC LSGC
ACC = Adenoid Cystic Cancer
BC = Breast Cancer
LSGC = Left Submandibular Gland Cancer
RC = Rectum Cancer
GIST = Malignant Gastrointestinal Stromal
Tumors of Small Intestine
The chart below sets forth swimmer plot of duration of exposure, tumor response, and
survival status by RECIST V ersion 1.1 (full analysis set):
Subject ID
Time since the date of first dose (Day)
Dose Group:
CR (Complete Response)
S03010
S03005
S03009
S03004
S01006
S01005
S02008
S03002
S03003
S02007
S02006
S01002
S02002
S02001
S02004
0 20 40 60 80 100 120 140
40mg 80mg 120mg 160mg 200mg
160 180 200 220 240 260 280 300 320 340 360 380 400 420 440
PR (Partial Response)
SD (Stabilization of Diseases)
PD (Progress of Disease)
NE (Not Evaluated or Not Evaluable)
NA (N/A)
Death
Survival
Source: Company data
There were two long-term responder or patients whose diseases have been stable under
treatment for long period of time in the HX301-I-01 China Study. For the best of patient’s
interest and ethical reason, the HX301-I-01 China Study was kept open (i.e., no database-lock)
to allow such patients being treated in the study with HX301. We would like to collect all
patient’s data including such long term responder. Therefore, the HX301-I-01 China Study was
kept open for approximately four years, and it was completed in July 2024 when the clinical
study report was issued. Despite that we obtained the NMPA approval for the combination
study of HX301 in August 2024, the prolonged duration may cast a potential risk on the pace
of our clinical study development.
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Preclinical Results and HX301-II-01 China Combination Study
As illustrated in the chart below, in this U87 MG human glioblastoma subcutaneous
xenograft model, HX301 at 100 mg alone or temozolomide at 0.5 mg both induced mild to
moderate anti-tumor effects, whereas the combination treatment with both HX301 and
temozolomide led to a greater anti-tumor effects in comparison to either HX301 or
temozolomide alone, suggesting a synergistic effect between HX301 and temozolomide.
0 5 10 15 20 25 30
0
500
1000
1500
2000
2500
Subcutaneous U87 MG Tumor Growth
Days Post Treatment
Tumor Volume (mm3)
Vehicle
HX301 100mpk QD
TMZ 0.5mpk QD (five days on and two days off)
HX301 + TMZ 0.5mpk
Source: Company data
HX301-II-01 China Study
We submitted a phase II clinical study protocol to NMPA (the “ HX301-II-01 China
Study Protocol ”) for the combination with temozolomide in the treatment of glioblastoma,
which followed the ICH GCP and provided the primary objective is to evaluate the safety and
tolerability of HX301 combined with temozolomide in the treatment of patients with
glioblastoma. In August 2024, NMPA issued the clinical trial approval notification (the
“HX301 GBM Combination Approval ”) to us, which allows us to conduct clinical trials of
HX301 in combination with temozolomide in the treatment of patients with glioblastoma. No
additional approval is needed before we proceed to carry out the confirmatory clinical studies
(ᑗґ༊᜕) or pivotal-stage clinical studies (ᑗґ༊᜕). The HX301 NMPA GBM
Combination Approval also provided that, after completing the exploratory clinical studies ( ઞ
ᑗґ༊᜕) and before carrying out the confirmatory clinical studies or pivotal-stage
clinical studies, the applicant shall apply to CDE for a communication meeting to evaluate
subsequent clinical studies. The HX301-II-01 China Study is divided into two phases: (i) the
screening period (from the time subjects sign the informed consent form to 28 days before the
first administration of the drug); and (ii) the treatment period lasted until the subject either
developed an intolerable toxicity, withdrew consent, developed progression of disease, died;
whichever occurred first.
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The brand name for the temozolomide used in the HX301-II-01 China Study is Tazian ®
and it was developed by a CDMO company with a large-scale commercial GMP production
base for biologics. Temozolomide is included in NRDL. As of the Latest Practicable Date, our
Company may settle payment of this drug in accordance with prescriptions for the clinical
studies, and according to Frost & Sullivan, the price of temozolomide in this brand is
RMB89.43/20mg*5 tablets in 2025 and there are plenty supply in the market. As of the Latest
Practicable Date, we have enrolled seven patients for this clinical study and incurred a total
cost of approximately RMB17,400 for this combination drug.
Summary of Safety Data from Phase I Clinical Trials in China
During the Track Record Period, we completed one clinical trial programs of our Key
Product HX301 in China, namely, the HX301-I-01 China Study. As of December 27, 2023, 20
patients with advanced solid tumor were enrolled and treated in the phase I studies in China.
The table below sets forth the summary of frequently reported treatment-related
treatment-emergent adverse events by preferred term in Phase I trials of HX301 in China:
Grade /H113503 Treatment-Related Adverse Events
Preferred Term
40 mg
(N=3)
80 mg
(N=3)
120 mg
(N=4)
160 mg
(N=3)
200 mg
(N=7)
Total
(N=20)
At least one Grade /H113503 TRAE /H1118/H1118/H1118/H1118/H1118/H1118/H11180 0 0 1 (33.3%) 3 (42.9%) 4 (20.0%)
Tests /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180 0 0 1 (33.3%) 2 (28.6%) 3 (15.0%)
Elevated gamma-glutamyl transferase /H1118 0 0 0 1 (33.3%) 0 1 (5.0%)
Elevated alanine aminotransferase /H1118/H1118/H1118/H11180000 1 (14.3%) 1 (5.0%)
Elevated aspartate aminotransferase /H1118/H11180000 1 (14.3%) 1 (5.0%)
Elevated alkaline phosphatase /H1118/H1118/H1118/H1118/H1118/H1118/H11180 0 0 1 (33.3%) 0 1 (5.0%)
Decrease in platelet count /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180000 1 (14.3%) 1 (5.0%)
Decrease in neutrophil count /H1118/H1118/H1118/H1118/H1118/H1118/H11180000 1 (14.3%) 1 (5.0%)
Metabolic and nutritional diseases /H1118/H1118/H11180000 1 (14.3%) 1 (5.0%)
Hyperglycemia /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180000 1 (14.3%) 1 (5.0%)
Gastrointestinal system diseases /H1118/H1118/H1118/H1118/H11180000 1 (14.3%) 1 (5.0%)
Indigestion /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180000 1 (14.3%) 1 (5.0%)
Note: When calculating the corresponding number of adverse events, only one person is counted if the subject has
multiple adverse events in one SOC or PT classification.
Clinical Development Plan for HX301
For the years ended December 31, 2023 and 2024 and the eight months ended August 31,
2024 and 2025, we incurred research and development costs for HX301 of RMB4.3 million,
RMB2.7 million, RMB2.4 million and RMB1.9 million, respectively, which accounted for
9.3%, 3.6%, 4.8% and 3.4% of our total research and development expenses during the same
periods, respectively. The Phase I dose escalation study for HX301 has been successfully
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completed, marking a significant milestone in understanding the drug’s safety profile and
establishing the appropriate dosage levels. This foundational work is crucial for the safe
progression into more advanced stages of clinical research.
Building on the safety profile and efficacy results from the phase I study, we proceed to
explore potential of HX301 in combination with temozolomide for the treatment of
glioblastoma (i.e., the HX301-II-01 China Study), with first patient enrolled in January 2025.
As of the Latest Practicable Date, this study was going and we have enrolled seven patients for
this study. The HX301-II-01 China Study aims to assess the efficacy and safety profile of this
combination therapy, which could potentially enhance treatment outcomes for patients.
Our approach to the development of HX301 is both strategic and collaborative. We
believe that by combining our internal expertise with the strengths of global partners, we can
accelerate the clinical progress of HX301 and ultimately improve patient outcomes. The
upcoming phase II study represent significant opportunities to advance the science of cancer
treatment and make a meaningful difference in the lives of patients worldwide.
Market Opportunity and Competition
Our HX301 is under clinical development for the treatment of glioblastoma, which is
among the most aggressive and difficult-to-treat forms of cancer. Current treatment options for
glioblastoma are limited, primarily involving surgery, radiation therapy, and chemotherapy,
which often result in suboptimal outcomes due to the blood-brain barrier and the tumors’
resistance to conventional treatments. The market opportunity for HX301 in treating
glioblastoma is substantial, given the high unmet medical need for more effective therapies.
According to the F&S Report, in China, the incidence of glioblastoma has reached 45.0
thousand in 2024 from 37.8 thousand in 2019 with a CAGR of 3.5%. The incidence is projected
to grow to 51.4 thousand in 2030 with a CAGR of 2.3% and 56.8 thousand by 2035,
representing a CAGR of 2.0%. In 2024, the market of glioblastoma in China reached RMB1.2
billion, and the market would enlarge to RMB3.2 billion and RMB5.4 billion by 2030 and 2035
with the CAGR of 17.9% and 10.7% respectively.
Currently, there is only one CSF1R targeted multi-kinase small molecule inhibitors on
clinical stage for treatment of glioblastoma in China.
WE MAY NOT BE ABLE TO ULTIMATELY DEVELOP AND MARKET HX301
SUCCESSFULLY.
HX044
Overview
HX044 is an innovative therapeutic candidate that is being developed as a potential
treatment for various types of cancers, particularly PD-1-resistant cancers (including but not
limited to NSCLC, melanoma, RCC and gastrointestinal cancer). It is designed as a
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bifunctional anti-CTLA-4 antibody SIRP /H9251fusion protein simultaneously targeting two
different antigens targets. This dual targeting approach is intended to enhance the immune
system’s ability to recognize and eliminate cancer cells more effectively than traditional
monoclonal antibodies, which typically target a single antigen, with better toxicity profile.
As a novel humanized bifunctional anti-CTLA-4 antibody SIRP /H9251fusion protein which
binds to CTLA-4 and CD47, HX044 features (i) enhanced efficacy via increased tumor
infiltrating lymphocyte-Treg depletion or tumor micro-environment restructure by its Fc
function; (ii) improved safety via reduced both target binding affinity as well as reduced
CTLA-4 ligand blocking activities; (iii) engagement of other ICI activities beyond CTLA-4,
e.g. CD47-SIRP /H9251blockade on between tumor cell and macrophage or DC cells; and (iv) low
antigen sinking due to reduced single antigen binding affinity, thus enabling lowered dose
treatments.
Our HX044 particularly stands out for its ability to engage multi-distinct immune
pathways, which can lead to a more comprehensive and potent anti-cancer immune responses.
By binding to its two targets, HX044 may be able to trigger multiple immune cell activation
mechanisms, resulting in a synergistic effect that could potentially overcome resistance and
lead to improved clinical outcomes for patients with cancer.
Mechanism of Actions
CTLA-4 is a classic immune checkpoint that function to suppress T cell function through
blockade of co-stimulatory receptors CD80/CD86 on antigen presenting cells interacting with
co-activator CD28 on T cells. Anti-CTLA-4 monoclonal antibody, ipilimumab, an IgG1 mAb,
is the first approved immune check point inhibitor, making it one of the two clinically validated
major immune-oncology targets together with PD-1/PD-L1. Importantly, these two ICIs have
completely different immune-oncology MoAs. MoAs of IgG1 type anti-CTLA-4 mAb
described thus far include blockade of CTLA-4 binding to its ligands of CD80/CD86 on APCs,
ADCC-/ADCP-mediated depletion of tumor-infiltrate Treg via its Fc function and the
remodeling of innate immunity in tumor micro-environment through Fc-receptor (FcR)-
engagement. The anti-tumor effects of ipilimumab could result from one, two or three of these
mentioned MoAs. However, ipilimumab has yet to be broadly successful as cancer treatment
for its narrow therapeutic window, including dose-limiting toxicity and irAEs. On the other
hand, recent works have revealed that while perhaps Fc function of ipilimumab may have
contributed significantly to its efficacy, the ligand blocking may actually be blamed for the
most of observed irAEs. Under this circumstance, one of the key objectives for creating a next
generation anti-CTLA-4 treatment would be to reduce its ligand blocking function while
maintain its Fc functions. Since CTLA-4 has different MoAs from those of PD-1/PD-L1,
CTLA-4 therapy is ideally aim at treating PD-1 resistant patients or in combination with PD-1
to increase clinical benefit. Such agents are expected to have great demands in the oncology
market.
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HX044 is a specifically engineered bifunctional antibody fusion protein targeting tumor
infiltrated immune cells, including Treg and tumor-associated macrophages, etc., via one of its
target receptors as well as Fc receptors on T cells and other immune cells within tumor
micro-environment. It is a next generation investigational immunotherapy with MoAs distinct
from PD-1/PD-L1 blocker, thus suitable for the treatment of PD-1-resistant solid tumors. Both
receptor targets of HX044 are upregulated on Treg in tumor micro-environment. HX044
efficiently depletes tumor infiltrating lymphocyte-Treg and facilitates tumor microenvironment
restructure by the coordinated cis-binding of both targets together with the engagement with
other immune cells with Fc-receptors within tumor micro-environment. It also blocks the
“don’t eat me” signal mediated by CD47-SIRP /H9251pathway on the macrophage with promotion
of phagocytosis effect, facilitated by its Fc engagement. Furthermore, HX044 blocks the
binding of tumor cells CD47 to SIRP /H9251on antigen presenting cell with activation of the antigen
presenting effect. The safety of HX044 is also greatly improved via minimized systemic
binding due to the significantly reduced binding affinity for both target receptors. HX044 also
showed superior antitumor activity as compared to its parental monoclonal antibodies, even for
“cold” tumor that is resistant to anti-PD-1 treatment. The significantly broadened therapeutic
window of HX044 makes it a promising new realm of immunotherapy for cancers.
Immunosuppressive
macrophages
Treg
Tumor
Cells
“Don’t Eat Me”
Innate
Immunity
DC
Macrophages
CD4
CD8
Macrophage
Phagocytosis
Antigen
Presentation
CD8+ T Cell Mediated
Anti-Tumor Immunity CD8
FcγR-engagement –induced
type I interferon
SIRPα
CD47
HX044
Myeloids
CTLA4
NK/
Mɸ
FcR
TIL-specific Treg
Depletion via ADCC/ADCP
XTME Remodeling
Treg
Depletion
H
Source: Company data
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Communications with Regulatory Authorities
Therapeutic Goods Administration (TGA)
Pursuant to the relevant laws and regulations in Australia, we submitted our HREC
application for our first-in-human phase I/IIa clinical study for HX044 (the “ HX044-I-01
Australia Study ”) to a certified HREC (the “ Approving HREC ”), and the Approving HREC
issued the approval letter (the “ HX044 HREC Approval Letter ”) on September 10, 2024,
confirming its approval of our clinical project, i.e. the HX044-I-01 Study. On September 11,
2024, we submitted the online notification form through the TGA website and received its
acknowledge on September 23, 2024. We did not received any request for further information
or negative comments from TGA after we filed the online notification. As of the Latest
Practicable Date, there were eight patients enrolled for the HX044-I-01 Australia Study.
NMP A
We submitted a Phase I clinical study protocol (the “ HX044-I-01 China Study
Protocol ”) to NMPA, which followed the ICH GCP and provided that the primary objectives
for this study are to (i) assess the safety and tolerability of HX044; and (ii) determine the MTD
and/or the RP2D of HX044 in subjects with advanced malignant tumors by evaluating DLTs.
The endpoints of this study are (i) adverse events, clinical laboratory assessments, vital signs,
and electrocardiograms; and (ii) evaluation of DLTs up to 21 days after the first dose of study
treatment.
The HX044-I-01 China Study Protocol was accepted by NMPA in November 2024, and
in January 2025, NMPA issued the clinical trial approval notification (the “ HX044 NMPA
Umbrella Approval ”) to us, which confirms that HX044 satisfied the relevant requirements of
drug registration, and allows us to carry out clinical trials of this product for advanced solid
tumors according to the NMPA HX044-I-01 China Study Protocol. In addition, we submitted
to NMPA a supplemental Phase I/IIa combination clinical study protocol for HX044 with
pucotenlimab in patients with advanced solid tumor. The revised primary objectives of the
HX044-I-01 China Study are to (i) assess the safety and tolerability of HX044 or in
combination with pucotenlimab; and (ii) determine the MTD and the RP2D of HX044 or in
combination with pucotenlimab in subjects with advanced malignant tumors by evaluating
DLTs. The endpoints remained the same as above-mentioned. We obtained the clinical study
approval in September 2025, and enrolled first patient for the combination therapy part in
November 2025. As of the Latest Practicable Date, there were 15 and two patients enrolled for
the monotherapy part and combination therapy part of the HX044-I-01 China Study,
respectively.
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Preclinical Studies of HX044
According to the F&S Report, Ipilimumab is currently the only CTLA-4 targeted mAb
drug approved for clinical treatment. As illustrated in the charts below, HX044 demonstrated
stronger anti-tumor effects than Ipilimumab at a significant low dose in human CD47
expressing “hot tumor” model (highly immunogenic, responsive to PD-1 mAb), suggesting a
broader therapeutic window of HX044 than Ipilimumab.
Human CD47 expressing “hot tumor” model
G1, Vehicle
G2, hSIRPα-Fc 4.6mg/kg
Days post Treatment
Tumor V olume (mm3)
Tumor V olume (mm3)
Tumor V olume (mm3)
Days post Treatment Days post Treatment
2000
1500
1000
500
0
2000
2500
1500
1000
500
0
3000
2000
1000
0
0 5 10 15 20 25 30 0 5 10 15 20 25 0 5 10 15 20 25
G3, Ipilimumab 8.6mg/kg
G4, HX044 6.6mg/kg
G1, Vehicle
G2, hSIRPα-Fc 1.38mg/kg
G3, Ipilimumab 2.58mg/kg
G4, HX044 1.98mg/kg
G1, Vehicle
G2, hSIRPα-Fc 0.092mg/kg
G3, Ipilimumab 0.172mg/kg
G4, HX044 0.132mg/kg
Source: Company data
In addition, HX044 showed stronger Treg depleting activity than Ipilimumab thus
producing superior anti-tumor efficacy over Ipilimumab in a huCD47 expressing “cold tumor”
model (less immunogenic, non-responsive to PD-1 mAb).
Tumor V olume (mm3)
2000
1000
0
036 9
Human CD47 expressing “Cold Tumor”
4000
3000
12 15 18
G1, Vehicle
G3, hSIRPα-Fc 2.3mg/kg (1st-2nd)/4.6mg/kg (3rd-5th)
G2, Ipilimumab 4.3mg/kg (1st-2nd)/8.6mg/kg (3rd-5th)
G4, HX044 3.3 (1st-2nd)/6.6mg/kg (3rd-5th)
Source: Company data
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Clinical Studies of HX044
We own the worldwide development and commercialization right of HX044.
As of the Latest Practicable Date, we were conducting the HX044-I-01 clinical studies in
Australia and China concurrently, which is designed to be a multi-center, open-label phase I/IIa
study of HX044 in patients with advanced solid tumor malignancies, including dose escalation
phase (Phase I) and dose expansion phase (Phase IIa) to establish the MTD and/or RP2D, and
to evaluate the preliminary antitumor activity of single agent HX044. For Phase I of the
HX044-I-01 Australia Study, we expect to enroll patients with all tumor types regardless of
previous PD-1/PD-L1 exposure, whereas for Phase IIa of the HX044-I-01 Australia Study, we
will enroll patients who have progressed during or after previous treatments of PD-1/PD-L1
regimen in selected tumor types. The advanced solid tumor targeted by our product refers to
relapsed/refractory solid tumor.
The HX044-I-01 studies were divided into a screening period (28 days before first dose),
treatment period (up to 24 months), safety follow-up and survival follow-up period. Safety will
be evaluated throughout the study up until 90 (±7) days after the last dose of study treatment.
Subjects enrolled for the HX044-I-01 Australia Study will be administered every 3 weeks
(21±3 days) via intravenous infusion. Study treatment will continue every 3 weeks (21±3days)
until the subject develops an intolerable toxicity, withdraws consent, develops progression of
disease, death, lost to follow-up, start of new anticancer treatment or up to study treatment
duration of 24 months, whichever comes first.
Monotherapy Part of the HX044-I-01 Studies in Australia and China
In October 2024, we entered into the clinical trial research agreement with an Australian
clinical trial research institution, initiating the HX044-I-01 Australia Study, As of the Latest
Practicable Date, we have enrolled eight patients for the HX044-I-01 Australia Study. In
January 2025, NMPA issued the clinical trial approval notification (the “ HX044 NMPA
Umbrella Approval ”) to us for conducting clinical trials of HX044 in treatment of advanced
malignant solid tumor, and we enrolled first patient in March 2025 for this HX044-I-01 China
Study. As of the Latest Practicable Date, there were 23 patients enrolled for the monotherapy
part of the HX044-I-01 studies (eight patients in the Australia and 15 patients in China), among
which, one patient has achieved partial response and five patients has achieved stable disease.
The HX044-I-01 Australia Study and the HX044-I-01 China Study are the same study
conducted in different jurisdictions, and we expect to finance such clinical studies partially
with the net proceeds from the Listing. For details, please refer to “Future Plans and Use of
Proceeds — Use of Proceeds” in this prospectus.
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Combination Therapy Part of the HX044-I-01 studies in China
We submitted to NMPA a supplemental Phase I/IIa combination clinical study protocol
for HX044 with pucotenlimab in patients with advanced solid tumor, and obtained the clinical
study approval in September 2025. We enrolled first patient for the combination therapy part
in November 2025. The brand of pucotenlimab used in the combination study of HX044 is
Puyouheng
TM, with marketing authorization held by Lepu. According to Frost & Sullivan,
there are plenty supply of pucotenlimab in the market. As of the Latest Practicable Date, we
have incurred a total cost of approximately RMB291,200 for this combination drug.
Clinical Development Plan for HX044
For the years ended December 31, 2023 and 2024 and the eight months ended August 31,
2024 and 2025, we incurred research and development costs for our HX044 of approximately
RMB3.9 million, RMB16.4 million, RMB6.9 million and RMB8.0 million, respectively, which
accounted for approximately 8.3%, 21.9%, 13.6% and 14.2% of our total research and
development expenses during the same periods, respectively.
The HX044-I-01 Australia Study is of significant importance as it aims to provide a novel
immunotherapy of PD-1-resistant solid tumors. We plan to conduct clinical trial for HX044
concurrently in Australia and China due to the complementary advantages of the two countries.
Australia boasts a flexible regulatory environment, streamlined processes, high-quality
research infrastructure, and a strong talent pool. China, on the other hand, has vast patient
resources, a rapidly maturing healthcare system and infrastructure, robust policy support, and
immense market potential. As confirmed by F&S, it is a normal practice for biotech companies
to conduct clinical studies in Australia and China concurrently. However, we have no plan to
conduct pivotal clinical trial for HX044 in Australia due to the high capital investment and in
line with our development strategy to focusing on our primary market of China. Looking ahead,
we expect the clinical research roadmap for HX044 to include a phase II combination study
with certain PD-1 targeting drugs. We plan to investigate the potential of HX044 when used in
conjunction with other treatments across a range of cancer types, including melanoma,
gastrointestinal cancer, and other solid tumors. The aim of combination study is to explore the
possibility of enhanced therapeutic effects that may arise from combining HX044 with existing
therapies, potentially offering improved outcomes for cancer patients. This planned clinical
study underscores a commitment to exploring the full potential of HX044 and its role in future
cancer treatment paradigms.
WE MAY NOT BE ABLE TO ULTIMATELY DEVELOP AND MARKET HX044
SUCCESSFULLY.
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PRECLINICAL STAGE CANDIDATES
HX111
Mechanism of Action
HX111 is an antibody-drug conjugate designed to specifically target lymphoma/leukemia
as well as certain target receptor-positive solid tumors, e.g. many sarcomas. The target of
HX111 is over-expressed in selected lymphoma and leukemia, so being a tumor associated
antigen, including nearly all A TL, AITL, NK/T, Histiocytic lymphoma, etc. It is also expressed
on surface of many solid tumor cells, but with little expression among normal tissues, including
normal blood cells. The monoclonal antibodies of the same target have been widely tested in
solid tumors in clinics with little safety concern but lack of efficacy. HX111 shows efficient
clearance of target positive lymphoma and leukemia cells and solid tumor cells in many
preclinical animal models.
Clinical Development Plan for HX111
We own the worldwide development and commercialization right of HX111. As of the
Latest Practicable Date, we have completed the preclinical studies of HX111 and submitted the
IND application of a Phase I/IIa clinical study of HX111 to NMPA in October 2025. We expect
to obtain the clinical study approval in the first quarter of 2026.
HX017
Mechanism of Action
HX017 is a monoclonal antibody targeting human NKG2A/CD94, a heterodimer
inhibitory receptor expressed on natural killer cells and CD8
+ cytotoxic lymphocytes. HX017
can efficiently block the interaction between NKG2A/CD94, often upregulated in cancer and
viral infected patients, and its ligand human leukocyte antigen-E, a non-classical MHC-I
molecule whose expression is often upregulated by tumors to avoid immune surveillance.
HX017 as an immune checkpoint inhibitor recovers anti-tumor and/or antiviral cytotoxicity of
both natural killer cells and CD8
+ cytotoxic lymphocytes. HX017 can be developed as
anti-cancer immunotherapy together with PD-1 antibody, particularly for solid tumors with
upregulated HLA-E expression, and as a novel anti-viral infection agent.
Clinical Development Plan for HX017
We own the worldwide development and commercialization right of HX017. HX017 was
developed as preclinical candidate compounds. As of the Latest Practicable Date, we have
completed the preclinical studies and achieved promising results for HX017. While we do not
expect to prioritize the clinical studies of HX017 by ourselves, we plan to proactively seek
collaboration with industry-leading business partners to further develop HX017.
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HX129
Mechanism of Action
HX129 is an antibody-drug conjugate specifically targeting to TRBV12, which constitute
polymorphism with more than 30 families. A given T cell-derived lymphoma/leukemia
expresses a defined TRBV . The antibody of HX129 only recognizes a specific TRBV and
efficiently deplete lymphoma/leukemia of this specific subtype of TRBV . HX129 causes little
toxicity to normal T cells of other TRBV subtypes, thus limiting its toxicity. Thus, such ADC
would be potentially a safe T cell targeting therapy.
Clinical Development Plan for HX129
We own the worldwide development and commercialization right of HX129. HX129 was
developed as preclinical candidate compounds. As of the Latest Practicable Date, we have
completed the preclinical studies and achieved promising results for HX129. While we do not
expect to prioritize the clinical studies of HX129 by ourselves, we plan to proactively seek
collaboration with industry-leading business partners to further develop HX129.
HX035
HX035 is a novel bispecific OX40 antibody targeting to two distinct OX40 epitope. It is
a strong depleting antibody with strong and enhanced ADCC, significantly superior than those
parental monoclonal antibodies. It is also a ligand blocker and an antagonistic antibody. It
showed strong anti-aGVHD model in vivo, representing a positive anti-autoimmune drug
candidate for a variety of autoimmune diseases, including AD, etc.
Clinical Development Plan for HX035
We own the worldwide development and commercialization right of HX035. We plan to
file the IND application for HX035 by the first quarter of 2026.
COMMERCIALIZED PRODUCT
HX008
HX008 is a humanized monoclonal antibody to PD-1 by using human IgG4 isotype, which
can antagonize the PD-1 signal to restore the capability of the immune cells to kill cancer cells
through blocking PD-1 binding to their ligands PD-L1 and PD-L2. It innovatively employs
antibody engineering techniques to introduce mutations in Fc portion to increase FcRn binding,
thereby significantly improving its half-life and leads to strong clinical anti-tumor activity and
a favorable safety and efficacy profile. HX008 demonstrated efficacy and good safety profile
in the completed Phase Ia clinical trial in solid tumors. Furthermore, as the extension of the
half-life of HX008 did not cause any additional AE along with its encouraging clinical efficacy
profile.
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HX008 received IND approval from the NMPA in August 2017, which included clinical
study protocols for phase Ia, Ib and subsequent phase II and phase III. The HX008 Phase Ia
trial was completed with MTD and RP2D determined per the clinical trial protocol in May
2018 and final CSR completed in May 2020.
Shortly after we obtained the clinical study approval in August 2017 and through a series
of equity transfer agreements entered in between 2017 and 2019, we transferred out our rights
and interests in HX008 in consideration of a one-off cash payment of RMB350.0 million and
annual royalty fee to Lepu. In July and September 2022, the NMPA granted conditional
marketing approval for HX008 for the treatment of MSI-H/dMMR solid tumors and inoperable
or metastatic melanoma, respectively. As of the Latest Practicable Date, we have received full
payment of the one-off cash payment of RMB350.0 million. Benefitted from the successful
commercialization of HX008, we received payment of approximately RMB0.7 million,
RMB4.4 million and RMB13.1 million as the HX008 annual royalty fee for 2022, 2023 and
2024 respectively as of the Latest Practicable Date. On August 14, 2024, we entered into the
supplemental agreement with Lepu, which provided that Lepu shall transfer the remaining 9%
equity and pay the corresponding equity transfer fee of RMB70.0 million. Additionally, our
Company has the right to use the anti-PD-1 monoclonal antibody sequence for exclusive
research, development, improvement, combination therapy, and commercialization activities
for HX009, a novel anti-PD-1/CD47 bispecific antibody, with full intellectual property rights.
For details, please refer to “— Collaboration Agreements — HX008 Equity Transfer
Agreements” in this prospectus.
RESEARCH AND DEVELOPMENT (“R&D”)
We believe that our continuous dedication to research and development is instrumental in
propelling our business expansion and maintaining our competitive edge. The main impetus
behind our R&D endeavors is to address the unmet medical needs in the treatment of intricate
illnesses, with an overarching goal of holistic patient care. This involves the strategic targeting
of various critical disease pathways in a coordinated manner, aiming to enhance the overall
therapeutic benefits while maintaining a balanced approach. For the years ended December 31,
2023 and 2024 and the eight months ended August 31, 2024 and 2025, we incurred R&D costs
of RMB46.7 million, RMB74.7 million, RMB50.5 million and RMB56.2 million, respectively.
Our R&D Approach
At the core of our R&D approach is a long-standing commitment to innovation in the
realm of macromolecule therapeutics, with a particular focus on unmet clinical needs. This
approach is meticulously crafted to address the unmet clinical needs of patients suffering from
a variety of complex diseases.
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Our R&D efforts are anchored in the exploration and advancement of macromolecule
compounds (particularly employed in bispecific drugs and antibody-drug conjugates), which
offer unique advantages due to their high specificity, potency, and long-lasting effects. These
biologics, including proteins and antibodies, have the potential to revolutionize treatment
paradigms by targeting the underneath disease mechanisms.
In the pursuit to address unmet clinical needs, we are dedicated to venturing into
previously uncharted territories of science and medicine. Our team of experts is constantly
engaged in forefront research aimed at discovering novel pathways and mechanisms that are
theoretically proven and can be harnessed to create groundbreaking treatments. By focusing on
unmet clinical needs, we aim to be pioneers in our chosen therapeutic areas, offering patients
and healthcare providers entirely new treatment options.
Simultaneously, our R&D approach also emphasizes the value of improving upon existing
therapies, enhancing their efficacy, safety, and convenience for patients. Our efforts involve the
meticulous analysis of current treatment landscapes, identification of gaps or limitations, and
the application of cutting-edge science to engineer superior alternatives.
Our R&D approach is characterized by a multi-pronged approach that encompasses:
 Target Identification and V alidation: Through in-depth understanding of the target
receptor biology based on abundant reported literatures and our own observations,
including using advanced computational and bioinformatics tools, we set out to
identify new targets and/or new target mechanisms in disease pathogenesis, and then
validate their potential pharmacology role in treatments.
 Drug Discovery and Design: Our team employs state-of-the-art techniques in
antibody engineering based on V ersatiBody platform/workflow to design and test
macromolecule panels in order to identify candidate molecule with optimized
pharmacological properties of both desired target biology and druggability.
 Preclinical and Translational Research/Development: Rigorous and
comprehensive preclinical testing in vitro and in vivo ensures the safety and efficacy
of our candidates as per design, along with extensive translational research, paving
the way for rational clinical development, including identification of potential
disease indications and patient stratification.
 Clinical Trial Execution: We design and conduct clinical trials with precision,
adhering to the highest standards of the ICH GCP and regulatory compliance.
 Intellectual Property Management: A strategic IP management approach protects
our innovations and secures our competitive position in the market.
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 Collaboration and Partnership: We actively seek collaborations with academic
institutions, research organizations, and industry partners to leverage diverse
expertise and accelerate the development process.
 Market and Patient Insight: Continuous engagement with the medical community
and patients ensures that our R&D efforts are aligned with the real-world needs and
preferences.
By focusing on macromolecule therapeutics, FIC, BIC, and unmet medical need
strategies, we are poised to deliver transformative medicines that can significantly improve
patient outcomes and redefine the standards of care in various disease areas. Our R&D
approach is a testament to our unwavering dedication to innovation, patient-centricity, and the
relentless pursuit of scientific excellence.
Our R&D Team
Our R&D team is composed of highly skilled professionals with extensive knowledge and
a profound understanding of immune-oncology, cancer biology, and autoimmune diseases, as
well as translational and clinical sciences. They have been at the forefront in pinpointing
compounds that can regulate various pathways associated with illnesses, which gives us a
distinctive edge in fulfilling the clinical requirements for intricate conditions. Our R&D team
is spearheaded by a group of renowned scientists who bring with them a wealth of experience
in the realm of drug development. As of the Latest Practicable Date, under the supervision of
our chairman and executive Director, Dr. Zhang, our chief business officer, Dr. Tang and led
by our CEO and CSO, Dr. Li, our R&D team consisted of 20 members covering the fields of
biochemistry, biology, pharmacology and clinical science. Our core R&D personnel among our
management team have been working in the biopharmaceutical industry for an average of
approximately 20 years. All of our core R&D personnel have been involved in and contributed
to the R&D activities of the Core Product. During the Track Record Period, none of core R&D
personnel left our Group. To incentivize core R&D personnel to stay with us, we have offered
not only monetary compensation and bonuses but also equity incentives that vest progressively.
Our process research and CMC research team is part of our R&D team with five
experienced employees responsible for both internal early stage wet lab process and method
developments, covering cell development and upstream and downstream processes,
conjugation and analytical, and also project management of the outsourced CMC activities,
which constitute most of ongoing CMC activities at CDMO, including early cell line
construction evaluation, process development and pilot.
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Our R&D team is generally responsible for the worldwide development of our Core
Product and other pipeline products. Our R&D team has the capacity to conduct clinical
programs at various development stages in China and other jurisdictions. For our internally
discovered and developed drug candidates, we conducted drug discovery, quality assurance and
clinical activities (together with the clinical development team) including: (i) orchestrating all
clinical development endeavors; (ii) formulating the principal elements of clinical trials; (iii)
arranging and coordinating the selection of suitable CROs for engaging clinical sites and
managing clinical trials once they are underway; (iv) monitoring the clinical trials; and (v)
directing extensive regulatory interactions and coordination both in China and abroad.
The following table sets forth a breakdown of the number of our R&D team by function
and workplace as of the Latest Practicable Date:
Function/Responsibility Workplace
Number of
Employees
Process research and CMC research /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118China 5
Drug discovery and GLP studies /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118China 10
Pharmacology and translational medicine /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118China 1
Regulatory affairs/project management/quality assurance /H1118/H1118/H1118/H1118China 3
Overall strategic planning, development of new medicine /H1118/H1118/H1118Hong Kong 1
Total/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111820
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The following table sets forth the identities, positions, expertise of core R&D personnel and their involvement and contributions to the R&D
activities during the Track Record Period and up to the Latest Practicable Date:
Identity Position Joining Date Expertise
Involvement and contributions to the R&D activities
since the discovery of Core Product
Dr. Zhang /H1118/H1118/H1118/H1118/H1118/H1118Founder and Chairman March 2017 Structural biology Leading the overall strategic planning and scientific
development
Dr. Li /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Chief Executive
Officer and Chief
Scientific Officer
January 2022 Preclinical &
Translational
oncology, viral
infection
Leading the overall operation and strategic layout,
product research and development, including
screening indications for our pipeline products and
initiating V ersatiBody Platform and autoRx40 Platform
Mr. Ke Hang /H1118/H1118/H1118/H1118Non-clinical Executive
Director
April 2017 Antibody
development
Leading preclinical antibody screening, in vitro
efficacy, non-clinical pharmacology and toxicology
Mr. Y ang Tao /H1118/H1118/H1118/H1118Non-clinical Senior
Director
March 2023 Translational
medicine
Leading in vivo pharmacological research and clinical
pharmacology
Mr. Peng Feiyu /H1118/H1118CMC Director July 2017 CMC research Leading internal small-scale sample process research
and sample preparation, as well as outsourcing of
CMC research and production management for
biopharmaceuticals and small molecules
Ms. Lei Juan /H1118/H1118/H1118/H1118RA/PM/QA Director April 2022 Drug regulation Leading pharmaceutical regulatory affairs, project
management, as well as research and development
and production quality management
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Our V ersatiBody Platform
Our V ersatiBody Platform is an innovative antibody technology platform that serves as
the foundation for a new realm of therapeutic antibodies. This versatile platform is designed
to create bi- or multi-specific antibodies, antibody-fusion proteins and/or antibody-drug-
conjugates (ADC) that offer enhanced therapeutic potential, with a focus on tailoring
antibody-based agent to meet specific target biology requirements. The platform’s innovative
design allows for the development of antibody-based therapeutics, on one hand being
manufacturable with desired stability as pharmaceutical products required, while on the other
hand, being with desired pharmacology properties including longer half-life, reduced
immunogenicity, desired pharmacodynamic properties, which can translate to better efficacy,
safety, and convenience for patients. The platform’s flexible design and workflow allow for the
efficient creation of antibody-based molecules with these features and high successful rate.
At the heart of our V ersatiBody Platform lies the concept of antibody engineering, where
the structure of naturally occurring antibodies is modified to optimize their function such as
antibody’s binding affinity/avidity for the molecular and cellular targets, immunogenicity in
terms of both innate and adaptive immune reactions, as well as capacity for drug conjugations.
The result is a new class of antibodies therapeutics that can be developed with a high degree
of specificity and potency for the effective treatment of target diseases.
The core concept of our V ersatiBody Platform is based on the realization of the two
important facts: (i) protein functions is dependent on its specific structures which are
sequence-specific, each protein, including antibodies, is unique and different from each other;
and (ii) each disease is unique with distinct pathogenesis, requiring different intervention and
modality for effective treatments. In contrast to “one-size-fits-all” approach, the key advantage
of our V ersatiBody Platform is its adaptability that may enable the development of antibodies
against a wide range of targets and opening up possibilities for treating various diseases across
different therapeutic areas. This versatility is particularly valuable in the rapidly evolving
landscape of biopharmaceuticals, where the ability to rapidly develop new treatments for
emerging health challenges is crucial. Key features and capabilities of our V ersatiBody
Platform include:
 Diverse Structural Configurations: Ability to engineer IgG1, IgG4, symmetric
(2+2), asymmetric (1+1), and other formats to balance stability, manufacturability,
and therapeutic function.
 MOA-Driven Design: Customizable binding domains (e.g., ScFvs, Fabs, traps,
natural ligand mimics) and affinity tuning to enable precise targeting (e.g., ligand
blockade, cooperative cis-binding, effector function modulation).
 Optimized Biophysical Properties: Tailored Fc engineering (e.g., half-life extension,
effector silencing) and structural optimization for improved pharmacokinetics,
safety, and efficacy.
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 Broad Therapeutic Applicability: Successfully applied across our pipeline,
including immune-oncology (PD-1, CD47, CTLA-4, OX40) and angiogenesis
(VEGF) targets.
Our V ersatiBody Platform also incorporates elements of modular design, allowing for the
rapid assembly of new antibody constructs. Since the antibodies produced through this
platform are composed of mostly natural elements mutated structures or linkers, they can be
easily purified using traditional affinity chromatography. This not only ensures a high level of
quality control but also streamlines the production process of antibody development, which can
accelerate the time it takes to move from concept to clinical testing, potentially reducing the
overall cost and complexity of drug development.
The power of our V ersatiBody Platform is bolstered by its capability to create a variety
of bi- or multi-functional antibody modalities, which have been demonstrated in creation of our
diverse pipeline of antibody modalities: HX009, HX044, HX016, HX111, HX035, HX038.
These pipeline have distinct structures and meet specific distinct target biology requirement.
Below sets forth an illustrative example of simplified workflow of V ersatiBody Platform in
developing a therapeutic agent for a specific disease:
 Target considerations : At beginning, we need to understand the molecular targets relevant
to disease intervention, the target expression profiles and target biology in both disease
tissues and normal tissues, and thus the potential MoAs of the candidate targeting agents.
 Molecular Design per MoAs : Next, we take considerations of the target information above
to engineer an antibody modality, e.g. BsAb, that would interact to the intended targets
with defined affinity/avidity, via trans- or cis-binding. The antibody may also be equipped
with full Fc functions (e.g. ADCC, ADCP , long half-life, etc.), or small molecule payloads
per desired MoAs. The platform features modular design and allows for rapid adjustments
per feedbacks from testing, potentially leading to the development of an optimized
molecule.
 Manufacturability : Our V ersatiBody Platform ensures that the designed antibody
molecules are also manufacturable and stable, so can be scalable for large scale
production with high yield and purity.
We believe that our V ersatiBody Platform is highly productive in development of antibody
therapeutics, making it a powerful tool for the development of our next-generation antibody
treatments. As the platform continues to evolve, it is expected to play a pivotal role in shaping
our future of biopharmaceutical innovation.
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Our autoRx40 Platform
Autoimmune diseases affect over 600 million people globally and represent a significant
public health challenge, and major unmet medical needs. Our autoRx40 Platform is an
autoimmune disease therapeutic platform based on targeting OX40 and beyond. OX40 has
recently been recognized that it plays a central role in many autoimmune and inflammatory
diseases, along with many other receptors, making targeting these receptors for treating many
autoimmune diseases plausible.
Considering that OX40 is broadly involved in many autoimmune diseases with
participation of other receptors, we developed this autoRx40 therapeutic platform which is
centered around OX40 as well as other relevant receptors. Our autoRx40 platform is created by
taking advantages of our V ersatiBody Platform and our OX40 monoclonal antibody molecular
frame which enables us to rapidly create different molecules tailored for specific disease
treatments. Based on that, we have produced several drug candidates, including HX035, a
bispecific antibody that targets two different OX40 epitopes and enhances antibody-dependent
cellular cytotoxicity and blocks OX40-OX40L interactions, and HX038, a bispecific antibody
that targets OX40 and another relevant autoimmune receptor. These candidates are developed
to modulate the immune response by either depleting pathogenic cells or inhibiting their
activation, thereby mitigating autoimmune responses.
We believe that our autoRx40 Platform could represent a significant advancement in the
treatment of diverse autoimmune diseases. As the platform continues to evolve and its
candidates progress through clinical trials, it holds promise for transforming the treatment
landscape for patients suffering from autoimmune diseases.
CLINICAL DEVELOPMENT CAPABILITIES
Our clinical development unit is responsible for the strategic design and execution of
clinical trials, which are meticulously crafted to evaluate the safety, tolerability, and efficacy
of new drug candidates. This involves developing comprehensive study protocols, identifying
and engaging clinical trial sites, and monitoring the progress of trials to ensure data integrity
and compliance with regulatory standards. Mission of our clinical development is to advance
novel therapeutics from the laboratory bench to the patient’s bedside, ensuring that new
treatments are not only scientifically sound but also safe and effective.
Clinical Trial Design and Implementation
The Clinical Development division at our Group is tasked with steering the entire clinical
trial process, encompassing the creation of protocols and the supervision of trial operations, as
well as the gathering and interpretation of clinical data. The swift progression of our clinical
trials can be attributed to several key factors: (i) our tactical choice to launch clinical phase
trials on a global scale, bolstered by our exceptional preclinical findings, (ii) meticulous
planning of trial protocols, (iii) enduring collaborations with an array of medical centers and
leading investigators from various global regions, and (iv) efficient trial implementation.
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Our clinical development division is also responsible for the crucial role of identifying
suitable clinical sites. The criteria for site selection include factors such as the site’s track record,
knowledge of the disease area, proximity to specialists and patients, geographic reach, adherence
to regulatory standards and quality control measures, scope of services offered, staff expertise,
and technological capabilities. We have established partnerships in respect of conducting clinical
trials with numerous hospitals and principal investigators across China and Australia, which
bolster our capacity to conduct clinical trials for a range of conditions and stages. We believe that
the extensive network and geographical spread of these institutions grant us a competitive edge
in executing extensive clinical trials and facilitate the simultaneous operation of multiple trials.
Through these alliances, we are well-equipped to enroll participants from distinct populations for
studies that may otherwise struggle to meet recruitment goals.
During the Track Record Period, we cooperated with a total of six leading principal
investigators to conduct the clinical trials of our drug candidates. All three leading principal
investigators are from leading site centers that are top tier hospitals in China, and they are
recognized as nationwide experts in their respective disease areas. For the years ended
December 31, 2023 and 2024 and the eight months ended August 31, 2024 and 2025, the total
amounts paid to the site centers of the respective leading principal investigators amounted to
approximately RMB0.4 million, RMB1.2 million, RMB0.8 million and RMB0.9 million,
respectively. To the best of our Company’s knowledge, none of them have any past or present
relationships with our Group, our Directors, shareholders, senior management or any of their
respective associates. The leading principal investigators bear the responsibility of carrying out
clinical research activities at the site level, adhering strictly to our established trial protocols
as well as to the governing laws, regulations, and the principles of the ICH GCP , which
represent the quality standard for the proper and overall execution of clinical trials. For each
specific trial, a leading principal investigator is designated to hold the primary accountability
for upholding adherence to the trial protocol and ensuring strict compliance with good clinical
practices throughout the duration of the trial. Specifically, their responsibilities include
participating in trial design and planning, providing professional medical advice and guidance,
recruiting eligible patients as required by the protocol, and collecting corresponding trial data.
The following table sets forth a breakdown of the number of our clinical development
team by function and workplace as of the Latest Practicable Date:
Function/Department Workplace Number of Employees
Clinical Operations /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118China 11
Medical Department /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118China 3
Pharmacovigilance /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118China 1
Data Management /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118China 1
Quality Assurance/Quality Control /H1118/H1118/H1118/H1118/H1118/H1118China 1
CMO /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Hong Kong 1
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111818
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The following table sets forth the identities, positions, expertise of core clinical
development personnel and their involvement and contributions to the clinical activities during
the Track Record Period and up to the Latest Practicable Date:
Identity Position Expertise Involvement
Ms. Zhang /H1118/H1118/H1118/H1118/H1118/H1118/H1118CMO Clinical oncology Leading and managing
clinical trials and
participating in the
overall strategic
layout
Ms. Sun /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Clinical
Development
Vice President
Clinical medicine Leading clinical team
in China to ensure
clinical development
strategies are
implemented as
planned
Mr. Wang Shuai /H1118/H1118/H1118Clinical
Operation
Senior Director
Clinical trial
execution
Leading clinical
operation team to
ensure clinical trials
are executed as
planned in order to
support the pipeline
development from
clinical operation
side
Clinical Translational Research
Our clinical translational research is dedicated to evaluating the efficacy of treatments,
exploring tailored therapeutic strategies, and refining guidelines for personalized medicine
with the aid of newly generated data. The valuable insights gleaned from this research are
instrumental in steering our drug discovery efforts in innovative directions and in swiftly
securing proof-of-concept validation. We expertise in translational oncology, including cancer
experimental pharmacology modeling, particularly patient-derived cancer models for in vitro
(organoids) and in vivo (patient-derived tumor xenograft, PDX), predictive biomarker
discovery and validation, etc; as well as companion diagnostic assay development.
We foster robust collaborations with a diverse group of medical professionals, including
physicians, scientists, and key opinion leaders, utilizing their clinical feedback to enhance our
drug candidates, be it in refining indications or considering potential therapeutic combinations.
Through these partnerships, we continually refine our product development strategies. We have
cultivated an extensive network of premier contract research organizations and hospitals,
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ensuring that our drug candidates are efficiently advanced to the clinical trial phase. This
comprehensive approach accelerates the translation of our research findings into clinical
practice, thereby bringing potential breakthrough therapies one step closer to patients in need.
We based on professional and cost-efficient criteria when cooperate with CROs and
CDMOs, including: (i) professional expertise and experience: we prefer CROs and CDMOs
with extensive knowledge and hands-on experience in areas like antibody discovery, in vivo
pharmacological studies, GLP-compliant studies, clinical trials, and drug manufacturing. This
ensures accurate project execution and progress in drug R&D; (ii) compliance and quality
assurance: all partners must strictly adhere to relevant domestic and international laws,
regulations, and industry standards. A robust quality management system is essential to
guarantee research data authenticity, reliability, and drug safety; (iii) cost-effectiveness
analysis: while ensuring service quality, we consider cost - effectiveness and choose CROs and
CDMOs that offer high-value services. This helps optimize resource allocation and supports
our sustainable growth; and (iv) long-term cooperation potential: we value long-term and
stable partnerships with CROs and CDMOs. So, when selecting partners, we assess whether
their corporate culture and service philosophy align with ours and whether they have the
potential for common growth and innovation.
Relationship with CROs
We engage in collaborative efforts with CROs to facilitate and support our preclinical and
clinical studies, aligning with established industry standards. Our selection process for CROs
involves a meticulous evaluation of several criteria, including their credentials, academic and
professional backgrounds, industry reputation, and service fees. The CROs are all independent
third parties to our Group. To the best of our knowledge, none of these entities maintain past
or present affiliations with our Group, our Directors, shareholders, senior management, or any
of their respective associates. Particularly, Dr. Zhang does not have any relationship in Crown
Bioscience (Taicang) Co., Ltd.* (Ҧஔ(ࡑ)ʮ̡), one of our major CRO
provider during the Track Record Period and as of the Latest Practicable Date.
The involvement and contributions of our major CROs in the development of our product
candidates are delineated according to distinct roles. Preclinical CROs primarily conduct
services related to preclinical toxicity and safety evaluations, such as animal studies, under our
supervision and in adherence to agreed study designs. Clinical CROs offer a spectrum of
services essential for intricate clinical trials, conforming to agreed trial designs and under our
close supervision. Selection of a CRO is contingent upon the specific trial’s complexity and
workload. We closely oversee their operations, providing precise directives to ensure trial
execution quality and efficiency. This approach enables us to leverage our in-house expertise
on critical clinical trial elements, such as trial design, data analysis, and decision-making,
while maintaining compliance with applicable laws, regulations, and industry standards. We
believe that our collaborative efforts with CROs significantly expedite product development
timelines and facilitate the acquisition of requisite data reliably and efficiently.
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Service fees paid to CROs are primarily determined based on market rates for analogous
services, the volume of enrolled patients, trial duration, and the caliber and scope of services
rendered. For the years ended December 31, 2023 and 2024 and the eight months ended August
31, 2025, we have incurred CRO services fees of approximately RMB6.8 million, RMB19.1
million and RMB11.7 million, respectively. During the Track Record Period, we engaged 35,
37 and 28 CROs for the years ended December 31, 2023 and 2024 and the eight months ended
August 31, 2025, respectively, fluctuation of which was primarily due to the different
development stages of the respective pipeline products for the corresponding periods. For
example, we engaged more CROs in 2024 for our clinical development. The following table
sets forth the details of our major CROs engaged during the Track Record Period, which
contributed to approximately 39.1%, 65.9% and 38.3% of the total fees we incurred for CRO
services in 2023, 2024 and the eight months ended August 31, 2025, respectively.
Major CRO Background
Involvement and
Contribution
Transaction Amount
For the Y ear Ended
December 31
For the
Eight Months
Ended
August 31
2023 2024 2025
(RMB’000)
Crown Bioscience (Taicang)
Co., Ltd.* (Ҧ
ஔ(ࡑ)ʮ̡) /H1118/H1118/H1118/H1118/H1118/H1118
Preclinical CRO Preclinical
pharmacological
effect study
1,797.3 1,860.9 536.9
United-Power Pharma Tech
Co., Ltd.* (͍๕(̏ԯ)
ப΂ʮ̡) /H1118/H1118/H1118
Clinical CRO Clinical research
service
580.4 1,015.3 Nil
JOINN Laboratories (Suzhou)
Co., Ltd. (ࠃ݇(ᘽψ)޼
ʮ̡) /H1118/H1118/H1118/H1118/H1118/H1118/H1118
CRO Pharmaceutical
research and
safety evaluation
test service
Nil 4,575.5 Nil
Medicilon Preclinical Research
(Shanghai) LLC (Г౷ԭ
Ҧ(ɪऎ)ʮ̡) /H1118/H1118
CRO Non-clinical safety
evaluation service
Nil 3,708.0 3,265.7
Zhejiang Hengyu Biotech
Co., Ltd. (Ҧ
ʮ̡) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
CRO Cell testing and
virus clearance
validation
services
Nil Nil 925.0
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Major CRO Background
Involvement and
Contribution
Transaction Amount
For the Y ear Ended
December 31
For the
Eight Months
Ended
August 31
2023 2024 2025
(RMB’000)
Beijing Sinorda Pharmaceutical
Technology Co., Ltd. ( ̏ԯ
ʮ̡) /H1118/H1118
CRO Data management
and statistical
analysis services
279.2 1,431.7 599.1
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,656.9 12,591.4 5,326.8
Key terms of the agreements that we typically enter into with our CROs are set forth
below.
 Services . The CROs provide us with services in the course of our preclinical studies
and clinical trials, such as prescription research, record keeping and report
preparation.
 Term. The CROs are required to perform their services within the prescribed time
limit set out in each work order, usually on a project basis.
 Payments . We are required to make payments to the CROs in accordance with a
payment schedule agreed by the parties.
 Intellectual property rights . We own all intellectual property rights arising from the
projects conducted by the CROs within the stipulated work scope.
 Confidentiality. Our CROs are not allowed to disclose confidential information,
including but not limited to, any technical materials, research reports or trial data
elated to the project specified in the agreement.
Relationship with CDMOs
During the Track Record Period and up to the Latest Practicable Date, we had worked
with qualified CDMOs to manufacture and test drug candidates for preclinical and clinical
supply. We select CDMOs by taking into account a number of factors, such as their
manufacturing capacity and qualifications, relevant expertise, reputation, geographic proximity
and track record performance, product quality and production cost, applicable regulations and
guidelines, as well as our research and development objectives. We have adopted, and will
continue to implement, procedures to ensure that the production qualifications, facilities and
processes of our CDMOs comply with the applicable regulatory requirements and our internal
guidelines and quality standards. For the years ended December 31, 2023 and 2024 and the
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eight months ended August 31, 2025, we have incurred CDMO services fees of approximately
RMB4.8 million, RMB21.6 million and RMB14.5 million, respectively. During the Track
Record Period, we engaged 10, 11 and 9 CDMOs for the years ended December 31, 2023 and
2024 and the eight months ended August 31, 2025, respectively, fluctuation of which was
primarily due to the different development stages of the respective pipeline products for the
corresponding periods. During the Track Record Period and up to the Latest Practicable Date,
we maintain stable relationship with our major CDMOs.
Service fees paid to CDMOs are primarily determined based on market rates for
analogous services and the caliber and scope of services rendered. The following table sets
forth the details of our major CDMOs engaged during the Track Record Period, which
contributed to approximately 76.4%, 98.6% and 54.0% of the total fees we incurred for CDMO
services in 2023, 2024 and the eight months ended August 31, 2025, respectively:
Major CDMO Background
Involvement and
Contribution
Transaction Amount
For the Y ear Ended
December 31
For the
Eight Months
Ended
August 31
2023 2024 2025
(RMB’000)
Shanghai Thousand Oaks
Biopharmaceutical Co.,
Ltd. * (Ⴁᖹ
ʮ̡) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
CMC Small-scale testing
and process
validation
Nil 7,433.5 4,547.0
Nanjing Probio Biotech Co.,
Ltd.* (ҦϞ
ʮ̡) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
CMC Protein
characterization
service
2,292.5 6,940.3 3,515.0
Hubei Waterstone
Biopharmaceutical
Technology Co., Ltd.*
(ҦϞ
ʮ̡) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
CMC Manufacturing and
production
service of active
pharmaceutical
ingredients
952.9 577.7 98.9
MabPlex International Co.,
Ltd.* (ي
ʮ̡) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
CMC Manufacturing and
production
service of active
pharmaceutical
ingredients
393.9 364.8 40.0
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Major CDMO Background
Involvement and
Contribution
Transaction Amount
For the Y ear Ended
December 31
For the
Eight Months
Ended
August 31
2023 2024 2025
(RMB’000)
Zhenjiang ProBio Biotech Co.,
Ltd.* (ҦϞ
ʮ̡) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
CMC Manufacturing and
production
service of active
pharmaceutical
ingredients
Nil 3,012.4 Nil
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,638.3 21,341.0 8,200.9
Key terms of the agreements that we typically enter into with our CDMOs are set forth
below.
 Services . The CDMOs provide us with manufacturing services according to
GMP/cGMP requirements, quality standards and prescribed time frame as set out in
the agreement.
 Quality control . CDMOs are obliged to ensure that the quality of products meet the
quality standards set out in the agreement and requirements of GMP/cGMP and
other regulations.
 Payments . We are required to make payments to the CDMOs in accordance with the
payment schedule set forth in the agreement, which is typically linked to the stages
of the manufacturing process and the deliverables we receive.
 Intellectual property rights . We own all intellectual property rights arising from the
outsourced manufacturing processes.
 Confidentiality . Our CDMOs are not allowed to disclose confidential information,
including but not limited to, any technical materials, research reports or trial data
related to the project specified in the agreement, and such obligation generally
survive for five years.
 Remedies for non-conforming products . If the CDMOs fail to deliver products or
comply with substantial obligations under the relevant agreement, we are entitled to
terminate the agreement and request for late fees and compensation for losses due
to the failure.
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Particularly, in February 2024, we entered into agreement with Zhenjiang ProBio Biotech
Co., Ltd.* (ʮ̡, the “ Zhenjiang ProBio ”), which was previously
named as Jiangsu Genscript ProBio Biotech Co., Ltd.* (ʮ̡)
for the contract development and manufacturing of our Core Product HX009, aiming to use the
deliverables for the Biologics License Application of HX009 (the “ HX009 CDMO
Agreement ”). Pursuant to the HX009 CDMO Agreement, generally we are obliged to provide
the necessary materials and information of HX009 for its technical development work, make
payments to Zhenjiang ProBio as per the agreed schedule, accept deliverables within the
specified timeframe, and comply with all contract terms including confidentiality. On the other
hand, Zhenjiang ProBio is responsible for completing the technical development work within
the agreed scope, quality standards, and timeline, delivering the results of each project stage
to us, ensuring the work meets the required quality standards, cooperating with us in project
acceptance and intellectual property transfer, and keeping all confidential information obtained
during the contract performance confidential. As of the Latest Practicable Date, Zhenjiang
ProBio is the sole CDMO we are collaborating for the HX009. Zhenjiang ProBio is a member
of Genscript Biotech Corporation which is the owner of our Series B+ investors. See paragraph
headed “Pre-IPO Investments — Information about our Pre-IPO Investors” for details.
Currently, we are focusing on the ongoing clinical trials of HX009 conducted in China, namely,
(i) the HX009-I-01 China Study (Phase Ib); (ii) the HX009-II-02 China Study; and (iii) the
HX009-II-05 China Study. We also obtained the NMPA approval in February 2025 for a
combination study of HX009 with trastuzumab in patients with advanced triple-negative breast
cancer, and we expect the first patient enrollment for this combination study to be in 2026.
Pursuant to the HX009 CDMO Agreement, Zhenjiang ProBio is responsible for the
manufacture of seven batches of samples, including one batch of key clinical sample, three
batches of process validation samples required for marketing authorization application and
three batches of samples for on-site dynamic verification by the CDE. We have not entered into
any commercialization contracts with Zhenjiang ProBio as of the Latest Practicable Date. To
realize the commercialization of HX009, we plan to engage competent CDMOs to further
leverage complementary expertise, resources, and customer networks. We may work with large
pharmaceutical companies to access their manufacturing capabilities, regulatory expertise, and
marketing channels, thereby accelerating commercialization and reducing risks.
For risks relating to CROs and CDMOs, see “Risk Factors — Risks Relating to
Dependence on Third Parties — We substantially rely on third parties to monitor, support and
conduct clinical trials and preclinical studies of our drug candidates. If these third parties do
not successfully carry out their contractual duties or meet expected timelines, we may not be
able to obtain regulatory approval for, or commercialize, our drug candidates, and our business
could be materially affected” in this prospectus.
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COLLABORATION AGREEMENTS
HX008 Equity Transfer Agreements
 Technical Development (Cooperation) Agreement signed in January 2016 (the “ 2016
Cooperation Agreement ”)
HX008 is a humanized mAb to PD-1, which was developed by us prior to the Track
Record Period. On January 20, 2016, Wuhan Hanxiong entered into a technical development
(cooperation) agreement of HX008 with Zhongshan Kangfang. Pursuant to the 2016
Cooperation Agreement of HX008, (i) Wuhan Hanxiong and Zhongshan Kangfang shall be the
co-applicant and co-owner of the HX008 patent; (ii) key milestones include (a) the first
milestone: obtain humanized candidate antibodies, which means obtaining lead antibodies and
humanized candidate antibodies; (b) the second milestone: stable expression cell line, which
includes construction of expression vectors, establishment of stable cell lines and cell culture,
creation of the original cell bank and testing, and patent application eligibility confirmation;
(c) the third milestone: process, analytical methods, formulation, and stability testing, which
includes upstream and downstream processes, establishment of antibody analytical methods
and validation of these methods, technology transfer and preparation of pilot-scale samples,
formulation and stability studies of antibody liquids, antibody identification, and establishment
of quality standards for the bulk drug substance; and (d) the fourth milestone: obtain clinical
study approval, which involves commissioning preclinical studies and applying for clinical
approval. The 2016 Cooperation Agreement also provided that Wuhan Hanxiong shall provide
technical and scientific suggestions and instructions, and Zhongshan Kangfang shall produce
and achieve the provided milestones that satisfies Wuhan Hanxiong’s evaluation and
verification. At the time of entering into the cooperation agreement, the development of HX008
has processed to the later stage of the third milestone that it has optimized the upstream and
downstream processes, and primarily established the quality standards for the bulk drug
substance.
On March 18, 2016, Wuhan Hanxiong and Zhongshan Kangfang entered into a
supplemental agreement to the 2016 Cooperation Agreement, which supplemented that both
parties shall apply together for the clinical study application. Upon obtained the clinical study
approval, Zhangshan Kangfang shall transfer its rights under the approval to Wuhan Hanxiong
to proceed with the clinical studies of HX008.
On April 1, 2016, Wuhan Hanxiong and Zhongshan Kangfang filed patent application for
HX008 to the China National Intellectual Property Administration. On November 25, 2016,
Taizhou Hanzhong was established by Hangzhou Hanx as its wholly-owned subsidiary, which
is the research and development platform for HX008. On March 1, 2017, Wuhan Hanxiong,
Zhangshan Kangfang and Hangzhou Hanx entered into another supplemental agreement to the
2016 Cooperation Agreement. At the time of this supplemental agreement, Wuhan Hanxiong
was the wholly-owned subsidiary of Hangzhou Hanx. Pursuant to this supplemental agreement,
Wuhan Hanxiong transferred all its rights and obligations under the 2016 Cooperation
Agreement to Hangzhou Hanx. Wuhan Hanxiong and Zhongshan Kangfang filed the
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application to change the patent applicants of HX008 as Taizhou Hanzhong and Zhongshan
Kangfang to the China National Intellectual Property Administration, which took effective on
January 24, 2019. On July 19, 2019, the patent of HX008 was granted to Taizhou Hanzhong
and Zhongshan Kangfang. Taizhou Hanzhong and Zhongshan Kangfang are co-owner of the
patent for HX008 (patent no. 201610207741.6 and 201710024750.6).
 Equity Transfer Agreement signed in September 2017 (the “ 2017 Equity Transfer
Agreement ”)
In August 2017, Hangzhou Hanx, Taizhou Hanzhong and Zhangshan Kangfang obtained
the clinical study approval for HX008, and pursuant to the supplemental agreement previously
entered into in March 2016 and 2017, Hangzhou Hanx has the rights to solely proceed with the
clinical studies of HX008.
Given the progress in research and development of HX008, our Group transferred 40% of
our equity interest in Taizhou Hanzhong to Ningbo Houde Yimin Information Technology Co.,
Ltd.
* (ʮ̡ the “ Nanjing Houde Yimin ”), the largest shareholder
of Lepu and an independent third party to our Group. Nanjing Houde Yimin acquired 38.46%
equity interest in Taizhou Hanzhong from Hangzhou Hanx at a consideration of RMB50
million and further subscribed for RMB2,692,300 registered capital in Taizhou Hanzhong by
way of injection of new capital for a consideration of RMB70 million. Upon completion of this
equity transfer in December 2017, Taizhou Hanzhong was held by Ningbo Houde Yimin and
our Group as to 60% and 40%, respectively. For details, please refer to “History, Development
and Corporate Structure — Disposed Subsidiary — Taizhou Hanzhong” in this prospectus.
Through contractual arrangements executed in August 2018 and February 2019, Taizhou
Hanzhong and Zhongshan Kangfang became the co-patent applicants for the patents of HX008.
The transfer of patent applications of HX008 to Taizhou Hanzhong was completed in 2019
because Hangzhou Hanx gradually transferred its equity interest in Taizhou Hanzhong to Lepu
based on the payments received. Particularly, Zhongshan Kangfang waived its right to use
these patents globally and retained other patent rights under the 2016 Cooperation Agreement.
Also, Taizhou Hanzhong shall be the sole grantee of the clinical study approval of HX008 and
its new drug approval once obtained. Taizhou Hanzhong becomes the central entity for
HX008’s development and commercialization.
 Equity Transfer Agreements signed in September 2019 and August 2024 (the “ Lepu
Investment Agreements ”)
On September 3, 2019, we entered into an equity transfer agreement with Lepu, a
subsidiary of Ningbo Houde Yimin. Pursuant to this agreement, Hangzhou Hanx shall transfer
its 40% equity interest in Taizhou Hanzhong to Lepu for (i) an aggregate amount of RMB350.0
million (“ One-off Cash Payment ”) to be paid and equity interest to be transferred in
instalments as set out in the payment schedule with no other pre-conditions attached thereto;
and (ii) an annual payment of 4.375% of the net sales revenue of HX008 after its
commercialization (“ Annual Fee ”). Prior to the Track Record Period, we received RMB280.0
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--- page 374 ---
million of the One-off Cash Payment, and due to outstanding One-off Cash Payments from
Lepu and delayed settlement we entered into the supplemental equity transfer agreement with
Lepu on August 14, 2024 to confirm the completion date for the transfer of our remaining 9%
equity interests in Taizhou Hanzhong and payment of the outstanding One-off Cash Payment
of RMB70.0 million. Additionally, it restated that our Company has the right to use the
anti-PD-1 monoclonal antibody sequence for exclusive research, development, improvement,
combination therapy, and commercialization activities for HX009, a novel anti-PD-1/CD47
bispecific antibody, with full intellectual property rights. Upon completion of the supplemental
equity transfer on August 28, 2024, we ceased to hold any equity interests in Taizhou
Hanzhong. As of the Latest Practicable Date, we have received all outstanding One-off Cash
Payment as milestone payments and approximately RMB0.7 million, RMB4.4 million and
RMB13.1 million as the Annual Fee in accordance with its net sales revenues recorded in 2022,
2023 and 2024, respectively. Our Director are of the view that our Company has not
encountered any material dispute or deadlock with Lepu, which may have material adverse
impact on our Company’s operation and financial position in future.
Through transferring the exclusive rights for manufacturing, development and
commercialization of HX008, it is evident that we are capable to transferring our products
to market-leading business partners for further development manufacturing and
commercialization. In addition, benefited from Lepu’s strong capabilities in anti-PD-1
antibody drugs production, the above equity transfers with Lepu enables us to receive the
One-off Cash Payment and the Annual Fee as sharing from the commercialization of HX008.
The table below summarizes the major historical developments of HX008:
Date Agreement, Contracted Parties and Responsibilities
January 2016 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182016 Cooperation Agreement
(i). Wuhan Hanxiong (a then wholly-owned subsidiary of
Hangzhou Hanx): independently completed the
preclinical pharmacology and toxicology, production,
IND application and clinical trials of HX008
(ii). Zhongshan Kangfang: provided CRO services in the
preclinical antibody humanization and upstream process
development
November 2016 /H1118/H1118/H1118/H1118/H1118/H1118/H1118Taizhou Hanzhong was established as the research and
development platform for HX008, and subsequently
succeed the responsibilities of Wuhan Hanxiong.
August 2017 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Obtained the NMPA clinical studies approval for HX008
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Date Agreement, Contracted Parties and Responsibilities
September 2017 /H1118/H1118/H1118/H1118/H1118/H1118/H11182017 Equity Transfer Agreement
(i). Taizhou Hanzhong: research and development platform
of HX008
(ii). Hangzhou Hanx: the then sole shareholder of Taizhou
Hanzhong
(iii). Ningbo Houde Yimin: investment of RMB50.0 million
as the “prepayment” by way of equity consideration and
RMB70.0 million as the “R&D expenses” by way of
capital injection in consideration of the 60% equity
interest in Taizhou Hanzhong
May 2018 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Completed the phase Ia (a conventional phase I) clinical
study with MTD and RP2D determined per the clinical trial
protocol of HX008
September 2019 /H1118/H1118/H1118/H1118/H1118/H1118/H11182019 Lepu Investment Agreement
(i). Hangzhou Hanx; and (ii) Lepu
One-off Cash Payment of RMB350.0 million to be paid and
equity interest to be transferred as consideration in
instalments, and an annual payment of 4.375% of the net
sales revenue of HX008 after its commercialization.
June 2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Lepu filed an NDA of HX008 with the NMPA in melanoma
August 2024 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182024 Lepu Investment Agreement
(i). Hangzhou Hanx; and (ii) Lepu
Supplement agreement to the 2019 Lepu Investment
Agreement in respect of the remaining 9% of Hangzhou Hanx
in Taizhou Hanzhong and the outstanding One-off Cash
Payment of RMB70.0 million.
August 2024 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Hangzhou Hanx completed the remaining 9% equity transfer
to Lepu.
June 2025 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Lepu completed payment of all outstanding One-off Cash
Payment
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HX301 Onconova Co-development Agreement
With the expectation to explore combination therapies with our products at that time and
further broaden the indications for our immune-oncology pipeline products, in December 2017,
Hangzhou Hanx entered into a contract with Onconova Therapeutics, Inc. (the “ Onconova ”)
(the “ Onconova Co-development Agreement ”), regarding the license, development, and
commercialization of narazaciclib, a small molecule that is a CDK4/6 and/or ARK5 dual
inhibitor, for oncology indications for human use (which was in the preclinical stage small
molecule at the time of entering into the agreement and was further developed and renamed as
HX301 for our pipeline). Below sets forth the key terms under the Onconova Co-development
Agreement:
 IND-enabling Studies: Hangzhou Hanx shall use commercially reasonable efforts to
complete necessary pre-clinical studies for narazaciclib in order for both Hangzhou Hanx
and Onconova to submit an IND within two years of the effective date in the Greater
China for Hangzhou Hanx and in the U.S. for Onconova. Pursuant to this clause,
Hangzhou Hanx designed and conducted the IND-enabling studies that comply with the
regulatory requirements for both jurisdictions. In January 2020, Hangzhou Hanx obtained
the HX301 NMPA Umbrella Approval (No. CXHL1900340), and in December 2020,
Onconova obtained the Study May Proceed letter from FDA. Hangzhou Hanx has fulfilled
its obligations thereunder.
 License and Development: (i) Onconova grants Hangzhou Hanx an exclusive license to
develop and commercialize narazaciclib within Greater China. On the other hand,
Hangzhou Hanx grants Onconova with rights to develop and manufacture narazaciclib
outside Greater China. (ii) The Onconova Co-development Agreement stipulates that
Hangzhou Hanx is responsible for all development activities, including conducting
clinical trials and obtaining regulatory approvals in Greater China, while Onconova has
the right to review and comment on the design and implementation any clinical trials of
HX301. (iii) Design of the pre-clinical studies, design of the clinical trial protocols and
endpoints will be reviewed a joint steering committee (“ JSC”) established by both
parties. While each parties designate three representatives in the JSC, Hangzhou Hanx
have the final decision-making authority with respect to manufacture, development or
commercialization of HX301 within Greater China area and Onconova have the final
decision-making authority with respect to design and implementation of pre-clinical
studies to ensure compliance and sufficiency for the purpose of filing an IND in the U.S.
(iv) Onconova also has the right to examine and inspect any facilities of Hangzhou Hanx
or a subcontractor used in development of HX301 not more than once per year. (v)
Onconova is required to notify Hangzhou Hanx of any communications with regulatory
authorities (and vice-versa ). Each party must obtain prior written consent of the other
party before initiating communication with regulatory authorities, and each party must
notify the other of any communications received from regulatory authorities.
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/H22117 Registration filings : Hangzhou Hanx is responsible for developing the regulatory strategy
to obtain and maintain regulatory approvals for the sale of HX301 in Greater China area,
this includes preparing all necessary regulatory materials. Onconova is required to assist
Hangzhou Hanx by providing all supporting documentation within its possession and
control in a timely manner to facilitate the review and submission of these materials, in
accordance with applicable laws.
 Manufacturing : Generally, Hangzhou Hanx is responsible for the manufacturing of
HX301 in the Greater China area, and additionally at request of Onconova, Hangzhou
Hanx shall supply HX301 for Onconova’s phase I clinical trials at a consideration paid
by Onconova in the amount of Hangzhou Hanx’s actual fully burdened cost plus five
percent.
 Commercialization : During the term of the Onconova Co-development Agreement,
Hangzhou Hanx is exclusively responsible for the commercialisation of HX301 within
Greater China area for use in the oncology indications in humans. Hangzhou Hanx will
also bear all costs associated with the commercialisation efforts, including pre-marketing
and other related expenses incurred in connection with HX301’s commercialisation in
Greater China area.
 License Fees: The agreement outlines several payments under specific circumstances,
including:
— Upfront payment: Hangzhou Hanx shall make an upfront payment of US$450,000 to
Onconova within 60 days of the effective date of Onconova Co-development
Agreement.
— Potential milestone payments:
(i) By Hangzhou Hanx
Regulatory Milestone Event Milestone Payment
Receipt of the first Biologics License Application
Approval for the first indication of HX301 in
mainland China /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118US$5,000,000
Receipt of the second Biologics License Application
Approval for the second indication of HX301 in
mainland China /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118US$2,500,000
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Sales Milestone Event Milestone Payment
First time that annual aggregate Net Sales of HX301
in Greater China exceeds US$50,000,000 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118US$2,500,000
First time that annual aggregate Net Sales of HX301
in Greater China exceeds US$100,000,000 /H1118/H1118/H1118/H1118/H1118/H1118/H1118US$5,000,000
First time that annual aggregate Net Sales of HX301
in Greater China exceeds US$1,000,000,000 /H1118/H1118/H1118/H1118/H1118US$50,000,000
First time that annual aggregate Net Sales of HX301
in Greater China exceeds US$2,500,000,000 /H1118/H1118/H1118/H1118/H1118US$75,000,000
(ii) By Onconova
Regulatory Milestone Event Milestone Payment
Receipt of the first Regulatory Approval for HX301
in the U.S. /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118US$2,500,000
Receipt of the first Regulatory Approval for HX301
in a country or territory other than Greater China
or the U.S. /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118US$1,000,000
— Royalty rates:
(i) Royalty rates within Greater China
Annual Net Sales of Product Royalty Rate
For that portion of aggregate annual net sales less
than US$100,000,000 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183%
For that portion of aggregate annual net sales equal
to or greater than US$100,000,000 but less than or
equal to US$1,000,000,000 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185%
For that portion of aggregate annual net sales greater
than US$1,000,000,000 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186.5%
(ii) Royalty rates outside Greater China
Annual Net Sales of Product Royalty Rate
For that portion of aggregate annual Net Sales
outside Greater China until the IND expense cap
stipulated in the Onconova Co-development
Agreement is reached /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.5%
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— Sublicensing income:
(i) Sublicensing Fee to Onconova:
Time Period
Sublicensing Income
Payment to Onconova
Effective date of the Onconova Co-development
Agreement to Before Initiation of Phase II Trial /H1118/H1118
5% of any
Sublicensing Income
From Initiation of Phase II Trial to First Commercial
Sale /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
2% of any
Sublicensing Income
After First Commercial Sale /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180% (No sublicensing
fees payable)
(ii) Sublicensing Fee to Hangzhou Hanx:
Time Period
Sublicensing Income
Payment to Hangzhou
Hanx
Prior to filing of the first IND /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180% (No sublicensing
fees payable)
From filing of the first IND until before initiation of
Phase II Trial /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
2% of any
Sublicensing Income
From initiation of Phase II Trial until First
Commercial Sale /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
5% of any
Sublicensing Income
 Intellectual Property and Confidentiality: Onconova solely owns inventions made by its
employees, agents, or independent contractors, while Hangzhou Hanx solely owns
inventions created by its own personnel. Any inventions jointly developed by employees,
agents, or independent contractors from both parties will be jointly owned (“ Joint
Inventions ”). Both parties agree to cooperate in filing, prosecuting, and maintaining
patents for these Joint Inventions. Each party has the right to practice, license, assign, and
exploit Joint Inventions and patents arising therefrom without needing consent or
providing compensation to the other. The agreement includes confidentiality provisions,
requiring both parties to keep confidential any proprietary information exchanged under
the agreement, except where disclosure is required by law or regulation.
 Term: The agreement came into effect since December 2017, and shall remain in effect
until the expiration of all royalty payment obligations.
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 Termination: The agreement granted both parties the right to terminate if the other party
significantly fails to fulfill its obligations or the other party files for bankruptcy,
reorganization, liquidation, or receivership, or if it assigns a significant portion of its
assets for the benefit of creditors. Under the agreement, Onconova may terminate the
agreement if Hangzhou Hanx fails to make commercially reasonable efforts to
commercialize HX301 or Hangzhou Hanx or its affiliates challenge the validity of any
Onconova patents, initiate opposition proceedings, or oppose any patent extensions.
Hangzhou Hanx may also terminate the agreement by providing 45 days’ prior written
notice to Onconova. Termination of the agreement would result in (i) immediate
termination of rights and licenses granted to Hangzhou Hanx, (ii) assignment of relevant
third-party agreements and materials related to HX301 to Onconova at no cost, (iii)
transfer of the management and performance of any ongoing clinical trials for HX301,
(iv) delivery of all pertinent regulatory filings, approvals, and commercialization data
related to HX301 to Onconova, and (v) transfer of copies of any relevant know-how and
provide training and support to enable Onconova to continue HX301’s development.
However, we do not expect termination of the agreement would have material adverse
impact to our business operation because (i) we have independently developed the
proprietary development technologies to for our HX301; and (ii) we have obtained the
clinical study approval in China for HX301 that solely granted to us, and we may and
already have conducted clinical studies for HX301 independently in China.
COMMERCIALIZATION
In order to effectively capture market demand amidst intense competition, we are
committed to implementing a strategic commercialization approach focused on fostering
mutually beneficial partnerships. By embracing win-win cooperation, we aim to optimize the
global value of our drug candidates. Recognizing the substantial investment required for
establishing in-house sales and marketing capabilities, we have opted not to establish a
fully-fledged commercialization team. Instead, our strategy entails the formation of a lean yet
highly proficient business development team, complemented by a dedicated alliance
management unit. This collaborative setup will facilitate seamless coordination with our future
commercialization partners.
Aligned with the anticipated approval timeline for each indication of our pipeline
products, we are actively seeking partnerships by way of, including but not limited to, equity
transfer with domestic and international entities possessing robust commercialization networks
and specialized expertise in our therapeutic portfolio. These partnerships will enable us to
effectively commercialize our pipeline products across various jurisdictions, including
prominent markets such as the U.S., EU, and China. Embracing adaptability, we remain
committed to pursuing a flexible strategy aimed at unlocking commercial value in key markets.
This approach entails actively pursuing synergistic licensing and collaboration opportunities
on a global scale.
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INTELLECTUAL PROPERTY
Our intellectual property is of vital importance to our business. We have a combination
of patent and other intellectual property, as well as confidentiality procedures, non-disclosure
agreements and employee non-disclosure, and other contractual restrictions in place to
establish and protect our commercially important technologies, inventions and know-how
pertinent to our business.
As of the Latest Practicable Date, we (i) owned seven issued patents, including two issued
patents in the PRC, three issued patents in Japan and two issued patent in the U.S., among
which, three patents are related to our Core Product; and (ii) have more than 11 pending patent
applications, including one pending patent application in the PRC, three pending patent
applications under the European Patent Convention (among which one patent is related to our
Core Product) and more than seven unpublished pending patent applications under the Patent
Cooperation Treaty. We have four types of patent and patent applications. As reviewed and
advised by our PRC IP Legal Adviser, Jingtian & Gongcheng, all material aspects of the
intellectual property rights of the Company’s Core Product and one of our Key Products
(HX301) in the PRC can be covered by certain registered patents or pending patent
applications. In addition, given that we have submitted PCT application with patent priority for
one of our Key Products (HX044), we believe that all material aspects of our two Key Products
(HX301 and HX044) can be covered globally by certain registered patents or pending patent
applications.
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The following table sets out the details of patents and patent applications material to our business operations as of the Latest Practicable Date:
Registered Patents (Inventions)
No. Application No. Patent Name Subject Matter
Patentee
(Patent Owner) Inventors
Application
Date Grant Date
Expiration
Date
1. /H1118/H1118/H1118ZL201711298703.7
(China) (1)
Anti-PD-1/CD47 bispecific
antibody and application
thereof
Material; Preparation
Method; Pharmaceutical
use
Hangzhou Hanx Ying HUANG
*;
Faming ZHANG;
Gan XI
*
December 8,
2017
February 23,
2021
December 8,
2037
2. /H1118/H1118/H11186961090 (Japan) (1) Anti-PD-1/CD47 bispecific
antibody and application
thereof
Material; Preparation
Method; Pharmaceutical
use
Hangzhou Hanx Ying HUANG
*;
Faming ZHANG;
Gan XI
*
December 8,
2017
November 5,
2021
December 8,
2037
3. /H1118/H1118/H1118US11680099B2
(U.S.) (1)
Anti-PD-1/CD47 bispecific
antibody and application
thereof
Material; Material and the
Preparation Method
thereof; Pharmaceutical
use
Hangzhou Hanx Ying HUANG
*;
Faming ZHANG;
Gan XI
*
December 8,
2017
June 20, 2023 July 24, 2038
4. /H1118/H1118/H1118ZL201811593852.0
(China)
Anti-OX40 monoclonal
antibody and application
thereof
Material; Preparation
Method; Pharmaceutical
use
Hangzhou Hanx Ying HUANG
*;
Faming ZHANG;
Gan XI
*
December 25,
2018
July 14, 2023 December 25,
2038
BUSINESS
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--- page 383 ---
No. Application No. Patent Name Subject Matter
Patentee
(Patent Owner) Inventors
Application
Date Grant Date
Expiration
Date
5. /H1118/H1118/H11186974500 (Japan) Method for improving
binding affinity of IgG
antibody to FcRn and
prolonging serum half-life
period thereof
Material; Preparation
Method
Hangzhou Hanx Faming ZHANG;
Gan XI
*; Ying
HUANG *
January 13,
2017
December 1,
2021
January 13,
2037
6. /H1118/H1118/H11187346576 (Japan) Anti-OX40 monoclonal
antibody and application
thereof
Material; Preparation
Method; Pharmaceutical
use
Hangzhou Hanx Ying HUANG
*;
Faming ZHANG;
Hang KE
December 25,
2018
September 19,
2023
December 25,
2038
7. /H1118/H1118US12195545B2
(U.S.)
Anti-OX40 monoclonal
antibody and application
thereof
Material; Preparation
Method; Pharmaceutical
use
Hangzhou Hanx Ying HUANG
*;
Faming ZHANG;
Hang KE
December 25,
2018
January 14,
2025
April 12, 2041
Note:
(1) Our Core Product HX009 is protected under the same type of patent right in the respective jurisdiction.
* Inventors marked with “*” are former employees, while the remaining inventors are current employees of us.
BUSINESS
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--- page 384 ---
Published Patent Applications (Inventions)
No. Application No. Patent Name Subject Matter
Patent Applicant
(Application Owner) Inventors Application Date
1 /H1118/H1118/H1118EP3569615
(17890966)
Method for improving binding
affinity of IgG antibody to
FcRn and prolonging serum
half-life period thereof
Method; Material;
Preparation Method
Hangzhou Hanx Faming ZHANG;
Gan XI
*; Ying
HUANG *
January 13, 2017
2 /H1118/H1118/H1118EP3722312
(17934019) (1)
Anti-PD-1/CD47 bispecific
antibody and application
thereof
Material; Preparation
Method; Pharmaceutical
use
Hangzhou Hanx Ying HUANG
*;
Faming ZHANG;
Gan XI
*
December 8, 2017
3 /H1118/H1118/H1118EP3904383
(18945324)
Anti-OX40 monoclonal antibody
and application thereof
Material; Pharmaceutical
use
Hangzhou Hanx Ying HUANG *;
Faming ZHANG;
Hang KE
December 25, 2018
4 /H1118/H1118/H1118CN202111385704.1 Recombinant antibody and uses
thereof
Material; Preparation
Method; Pharmaceutical
use
Hangzhou Hanx Hang KE; Faming
ZHANG; Feiyu
PENG
November 22, 2021
Note:
(1) These patent applications are related to our Core Product HX009.
* Inventors marked with “*” are former employees, while the remaining inventors are current employees of us.
BUSINESS
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--- page 385 ---
Unpublished Patent Applications (Inventions) (1)
No. PCT Application No. Patent Name Patent Applicant Application Date
1 /H1118/H1118/H1118/H1118PCT/CN2024/118841 (2) Methods of treating glioma the Company September 13, 2024
2 /H1118/H1118/H1118/H1118PCT/CN2024/119462 (3) Antibodies targeting CTLA-4 and CD-47 and uses thereof the Company September 18, 2024
3 /H1118/H1118/H1118/H1118PCT/CN2024/119472 (3) Methods for treating cancer the Company September 18, 2024
Notes:
(1) As of the Latest Practicable Date, these patent applications were under the review process and have not been publicized by the relevant IP authorit ies.
(2) This patent application is a priority application and related to one of our Key Product HX301.
(3) These two patent applications are related to one of our Key Product HX044, among which, PCT/CN2024/119472 is a priority application.
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--- page 386 ---
Particularly, in respect of item 5 of the registered patent (application no. 6974500) and
item 1 of the published patents (application no. EP3569615(17890966)), according to our PRC
IP Legal Adviser, Jingtian & Gongcheng, the PCT application number for these two patent
applications are PCT/CN2017/071124, which is the same-family patent application ( Νૄਖ਼л
͡ሗ) of 201710024748.9 in China (i.e., the patent application of “a method of enhancing the
binding affinity of IgG antibodies to FcRn and prolonging its serum half-life”) (the “ FcRn
Patent Application ”). The FcRn Patent Application involves Fc-engineering modifications to
introduce mutation sites, which were independently developed by our Company and does not
fall within the scope of the co-development with Zhongshan Kangfang (for details, please refer
to “— Collaboration Agreements — HX008 Equity Transfer Agreements”). Our PRC IP Legal
Adviser is of the view that (i) regarding our co-development with Zhongshan Kangfang, it was
limited to the antibody discovery process for HX008, specifically focusing on R&D related to
antigen-targeting sequences, and application no. 6974500 and application no. EP3569615
(17890966) are not products of co-development with Zhongshan Kangfang; and (ii) regarding
Company’s patent transfer to Taizhou Hanzhong, the obligation of change of patent applicant
from Hangzhou Hanx to Taizhou Hanzhong without consideration was waived by Taizhou
Hanzhong. As of the Latest Practicable Date, the FcRn Patent Application was rejected by the
China National Intellectual Property Administration. However, according to our PRC IP Legal
Adviser, such rejection does not necessarily result in invalidation or rejection of its
same-family patent/patent application in other countries/jurisdictions.
Our legal advisor as to intellectual property laws has checked and reviewed the legal
status of the pending patent applications with filed patent applications in the public online
databases as well as the information provided by us regarding the pending patent applications,
after which they are not aware of any fact or legal impediment with respect to those pending
patent applications that would preclude the issuance of patents with respect to such pending
patent applications except that these patent applications remain subject to the examination
opinions from the applicable patent examination authorities during the ordinary pendency and
examination of such patent applications.
Our PRC IP Legal Adviser, Jingtian & Gongcheng, conducted the freedom-to-operate
searches and analyses on our Core Product and major pipeline products and litigation searches
and analysis, and did not identify any substantial risk of infringement by any current key
technologies or features of these products against any active patents in China. Our PRC IP
Legal Adviser is of the view that there is no legal, arbitral or administrative proceedings in
respect of infringement of third parties’ IP rights involving our Group during the Track Record
Period and up to the Latest Practicable Date. Since (i) our current business development
strategies focus on the PRC market, and it is a common and cost-efficient practice to prioritize
the freedom-to-operate analysis in the targeted market region; and (ii) we did not commenced
and have no plan for any pivotal-stage clinical study, manufacturing and commercialisation of
our HX009 and HX301 in Australia and the U.S., we prioritized the freedom-to-operate
analysis for HX009 and HX301 in China to minimize the infringement risks. Also, since
HX044 is at an early stage, we did not perform freedom-to-operate analysis for HX044. We will
proceed with further freedom-to-operate analysis as the research and development progresses.
BUSINESS
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--- page 387 ---
Taking into account the views of our PRC IP Legal Adviser, our Directors confirmed that
during the Track Record Period and up to the Latest Practicable Date, (i) we were not involved
in any legal, arbitral or administrative proceedings in respect of, and we had not received
notice of any claims of infringement, misappropriation or other violations of third-party
intellectual property; and (ii) we were not involved in any proceedings in respect of any
intellectual property rights that may be threatened or pending and that may have an influence
on the research and development for any of our drug candidates in which we may be a claimant
or a respondent.
SUPPLIERS AND RA W MATERIALS
Suppliers
During the Track Record Period, our suppliers primarily consisted of CROs and suppliers
of equipment, devices and construction services. We select our suppliers by considering their
product quality, costs, delivery standards, industry reputation and compliance with relevant
regulations and industry standards.
For the years ended December 31, 2023 and 2024 and the eight months ended August 31,
2025, the aggregate purchases attributable to our five largest suppliers amounted to
approximately RMB16.3 million, RMB28.6 million and RMB23.3 million, respectively,
representing approximately 51.8%, 37.4% and 45.5% of our total purchases, respectively. For
the same periods, purchases attributable to our single largest supplier amounted to
approximately RMB6.4 million, RMB7.8 million and RMB6.3 million, accounting for
approximately 20.4%, 10.2% and 12.4% of our total purchases, respectively. We believe that
adequate alternative sources for such supplies exist and we will establish necessary
relationships with alternative sources based on supply continuity risk assessment.
BUSINESS
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The following table sets forth details of our five largest suppliers for the eight months
ended August 31, 2025:
Supplier Background Products/Services
Length of
Business
Relationship Credit terms
Purchase
Amount
%o f
Total
Purchase
(RMB’000)
Nanjing Probio Biotech Co.,
Ltd. (ҦϞ
ʮ̡) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
a company based in Jiangsu
mainly engaged in
CDMO services
technical development for
product registration,
cell pool establishment,
and CMC services
five years 15 days 6,321 12.4%
Supplier A /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118a company based in Hubei
mainly provided services
in areas of housing
construction projects,
steel structure projects,
municipal projects,
foundation and
foundation projects
renovation services three years 14 days 4,564 8.9%
Shanghai Thousand Oaks
Biopharmaceutical
Co., Ltd. (ي
ʮ̡) /H1118/H1118/H1118/H1118/H1118/H1118
a biopharmaceutical
company based in
Shanghai mainly engaged
in CDMO services
services for pharmaceutical
research before IND
application and
production material
procurement
two years 10 days 4,547 8.9%
Supplier C /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118a hospital in Beijing, being a
large modern tertiary
grade-A specialized
hospital for tumors
integrating medical
treatment, education,
research and prevention
clinical service three years 15 days 4,163 8.1%
Supplier D /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118a company based in Australia
primarily engaged in
provision of
comprehensive clinical
research services
clinical research services one year 30 days 3,682 7.2%
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 23,277 45.6%
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The following table sets forth details of our five largest suppliers for the year ended
December 31, 2024:
Supplier Background Products/Services
Length of
Business
Relationship Credit terms
Purchase
Amount
%o f
Total
Purchase
(RMB’000)
Shanghai Thousand Oaks
Biopharmaceutical
Co., Ltd.
(ࠢ
ʮ̡) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
a biopharmaceutical
company based in
Shanghai mainly engaged
in CDMO services
services for pharmaceutical
research before IND
application and
production material
procurement
two years 10 days 7,765 10.2%
Nanjing Probio Biotech Co.,
Ltd. (ҦϞ
ʮ̡) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
a company based in Jiangsu
mainly engaged in
CDMO services
services for pharmaceutical
research before IND
application
five years 15 days 7,320 9.6%
Supplier A /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118a company based in Hubei
mainly provided services
in areas of housing
construction projects,
steel structure projects,
municipal projects,
foundation and
foundation projects
renovation services three years monthly payment
based on
transaction
volume
4,731 6.2%
JOINN Laboratories
(Suzhou) Co., Ltd.
(ࠃ݇(ᘽψ)ӺʕːϞ
ʮ̡) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
a company based in Jiangsu
mainly engaged in
biomedical technology
R&D, technology
transfer, technical
services and testing
services by undertaking
service outsourcing
pharmaceutical research
and safety evaluation
test service
two years 10 business days 4,850 6.4%
Medicilon Preclinical
Research (Shanghai) LLC
(Ҧ(ɪऎ)
ʮ̡) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
a company based in
Shanghai mainly engaged
in R&D of biomedical
products and
pharmaceutical
intermediates, and
provide related technical
consultation
research on non-clinical
safety evaluation
service
three years seven days 3,923 5.1%
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 28,589 37.4%
BUSINESS
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--- page 390 ---
The following table sets forth details of our five largest suppliers for the year ended
December 31, 2023:
Supplier Background Products/Services
Length of
Business
Relationship Credit terms
Purchase
Amount
%o f
Total
Purchase
(RMB’000)
Supplier A /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118a company based in Hubei
mainly provided services
in areas of housing
construction projects,
steel structure projects,
municipal projects,
foundation and
foundation projects
renovation services two years monthly payment
based on
transaction
volume
6,405 20.4%
Supplier B /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118a company based in Tianjin
mainly engaged in
financing consulting
services and clinical
recruitment services
financing consulting
services
(Note)
one year 10 days upon
completion of
milestones,
as applicable
4,717 15.0%
Nanjing Probio Biotech Co.,
Ltd. (ҦϞ
ʮ̡) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
a company based in Jiangsu
mainly engaged in
CDMO services
Services for pharmaceutical
research before IND
application
four years 10 days 2,293 7.3%
Crown Bioscience (Taicang)
Co., Ltd. (Ҧ
ஔ (ࡑ)ʮ̡) /H1118/H1118/H1118/H1118
a company based in Jiangsu
mainly engaged in
biomedical R&D
outsourcing services
In vivo testing services for
pharmacological
efficacy
five years 30 days 1,797 5.7%
BLA Regulatory, LLC /H1118/H1118/H1118/H1118a company based in
Maryland mainly
engaged in
biopharmaceutical
consulting service and
medical device
consulting service
Pharmaceutical R&D
consulting services
two years 30 days 1,046 3.3%
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 16,258 51.8%
Note: The financing consulting services provided by Supplier B mainly include financial advisor services for Series
B financing and clinical strategy consulting services for HX009, which was remunerated agreed upon
arms-length negotiation and in line with the market practice on the basis of a fixed percentage of investment
amount.
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--- page 391 ---
None of our five largest suppliers in each period during the Track Record Period was our
related parties. None of our Directors or their associates or, to the knowledge of our Directors,
any Shareholder with over 5% of the share capital of our Company has any interest in any of
our five largest suppliers in the year ended December 31, 2023 and 2024 and the eight months
ended August 31, 2025.
Raw Materials
During the Track Record Period, we have procured raw materials and consumables for the
production of our drug candidates. During the Track Record Period, we did not experience any
significant fluctuations in raw material prices or delays that had a material impact on our
results of operations or financial position. The raw materials for our drug candidates to be used
in clinical trials as well as materials for our laboratory use are generally readily available in
the market through multiple suppliers.
COMPETITION
The biopharmaceutical industry is dynamic and fiercely competitive. While we believe
that our research and development capabilities enable us to establish a favorable position in the
industry, we encounter competition from international and domestic biopharmaceutical
companies, specialty pharmaceutical and biotechnology companies of various sizes, as well as
academic and research institutions. Currently we face keen market competition for our Core
Product HX009, multiple clinical trials of PD-1/PD-L1 mAbs are conducted for the first-line
treatment of cancer. Companies are making efforts to advance from third-line or second-line to
first-line therapy and continue to expand to consolidation therapy for locally advanced cancer
and neo-adjuvant therapy for early or mid-stage cancer. Hence, more competitor drugs of
HX009 are expected to be approved for first-line treatment of cancer in the near future.
We believe our principal competitive advantages are our industry-leading expertise in
translational medicine, deep understanding and strong techniques in structural biology and
experienced clinical development capabilities. We anticipate that competition will intensify as
new entrants join the market. Our drug candidates once successfully developed and
commercialized, will face competition from both established treatment and new drugs that may
emerge. This underscores the importance of our ongoing innovation and strategic positioning
to stay ahead in the evolving pharmaceutical landscape.
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EMPLOYEES
As a biotechnology company, our employees are our most valuable asset. We take pride
in being guided by a diverse and skilled leader team, comprising experts who are at the
forefront of their fields. As of the Latest Practicable Date, we had a total of 55 employees,
among which 49 were working in China and six were working in Hong Kong. The following
table sets forth a breakdown of our employees categorized by function as of the Latest
Practicable Date:
Function Number
Chairman /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181
Research and Development /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111820
Clinical Development /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111818
Business Chief Officer /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181
Finance /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185
General and Administration /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11187
Information Technology /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182
Legal and Compliance /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111855
Employment Agreements
We enter into individual employment agreements with our employees covering, amongst
others, salaries, employee benefits, workplace safety and grounds for termination. We also
enter into separate confidentiality agreements with relevant employees who have access to
trade secrets or confidential information about our business.
Training and Development
We place a high priority on the growth and advancement of our talent. To elevate their
expertise, knowledge, and skill, we provide specialized training programs and organize
targeted workshops that address the specific needs of our employees across various
departments. These initiatives are conducted regularly to ensure continuous professional
development.
Employee Benefits
We are committed to making sure that working conditions throughout our business
network are safe and that employees are treated with care and respect. Our employees’
remuneration comprises salaries, bonuses, house provident funds, social insurance premium,
and other welfare payments. Furthermore, we furnish our employees with various incentives
and benefits, including bonuses and employee share incentive plan. We have made
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contributions to our employees’ social insurance premium (including pension plans, medical
insurance, work-related injury insurance, unemployment insurance and maternity insurance)
and housing provident funds pursuant to applicable laws and regulations.
LAND AND PROPERTIES
As of the Latest Practicable Date, we did not own any real property. As of the Latest
Practicable Date, we leased four properties with gross floor area of approximately 5,880.0
sq.m. in the PRC, which were primarily used for offices, R&D, manufacturing and
accommodation. We believe our current facilities are sufficient to meet our near-term needs,
and additional space can be obtained on commercially reasonable terms. We do not anticipate
undue difficulty in renewing our leases upon their expiration.
The following table sets forth the details of our leased properties as of the Latest
Practicable Date:
Location Usage
Gross
Floor Area Lease Term
(sq.m.)
Hangzhou /H1118/H1118/H1118Office 130.0 January 1, 2025 – December 31, 2025
Wuhan /H1118/H1118/H1118/H1118Office/R&D 5,079.4 December 1, 2023 – November 31, 2028
Wuhan /H1118/H1118/H1118/H1118Accommodation 455.6 July 1, 2025 – June 30, 2026
Shanghai /H1118/H1118/H1118Office 215.0 June 1, 2024 – January 15, 2027
According to Chapter 5 of the Listing Rules and section 6(2) of the Companies
(Exemption of Companies and Prospectuses from Compliance with Provisions) Notice, this
prospectus is exempted from strict compliance with the requirements of section 342(1)(b) of
the Companies (Winding Up and Miscellaneous Provisions) Ordinance in relation to paragraph
34(2) of the Third Schedule to the Companies (Winding Up and Miscellaneous Provisions)
Ordinance which requires a valuation report with respect to all our interests in land or
buildings, for the reason that, as of December 31, 2024, none of our properties has a carrying
amount of 15% or more of our consolidated total assets.
As of the Latest Practicable Date, we do not own any other real property for our
operations. Upon expiration of our leases, we will need to negotiate for renewal of the leases
or relocate. There are sufficient alternative locations for us to choose from, but we may incur
additional costs in relation to the potential relocation. As of the Latest Practicable Date, the
lease agreements with respect to two properties we lease in the PRC for our business operations
had not been registered and filed with the relevant PRC government authorities. We estimate
that the maximum penalty we may be subject to for these unregistered lease agreements will
be approximately RMB20,000. As advised by our PRC Legal Adviser, failure to register such
lease agreements with the relevant PRC government authorities does not affect the validity of
the relevant lease agreements but the relevant PRC government authorities may order us or the
lessors to, within a prescribed time limit, register the lease agreements. In order to ensure
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on-going compliance with the PRC law and regulations relating to the registration of executed
lease agreements, we will continue to liaise with the lessors and try to register all the
unregistered leases. During the Track Record Period, we did not experience any dispute arising
out of our leased properties. We believe that the failure to register these lease agreements will
not have any material adverse impact on our results of operations. For details of risks relating
to our leased properties, see the section headed “Risk Factors — Risks Relating to Our
Operations — We are subject to risks associated with leasing properties” in this prospectus.
A W ARDS, PUBLICATIONS AND RECOGNITIONS
We have received various awards and recognitions for our projects and entities. The
following table sets forth the selected awards and projects for which we received government
grants as of the Latest Practicable Date:
Y ear of Grant Award/Projects/Recognition Issuing Authority
2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Science and Technology
SMES of Zhejiang Province
Department of Science and
Technology of Zhejiang
Province (ኪҦஔᝂ)
2017 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118CD47/PD-1 bifunctional antibody
drug (HX009) (Sub-Project
No. 2017ZX09302010-003-004)
“Major New Drug Invention” for
the 13th Five-Y ear Plan
(2017-2020) (ɽਖ਼
ධ“ɽอᖹ௴Ⴁ”(2017-2020))
2017 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Long-acting PD-1 antibody drug
(HX008) (Sub-Project
No. 2017ZX09302010-004-001)
“Major New Drug Invention” for
the 13th Five-Y ear Plan
(2017-2020) (ɽਖ਼
ධ“ɽอᖹ௴Ⴁ”(2017-2020))
In addition, our progress was also driven by our long-term commitment to staying at the
forefront of industry knowledge and expertise. Employees of our core R&D team has published
several publications, which contribute meaningfully to the discourse within our sector and
foster collaborative growth. Our publications cover topics that span the breadth of our
operations, from cutting-edge industry trends and breakthroughs in technology to strategic
business analyses and operational best practices. The table below sets forth the selected
publications as of the Latest Practicable Date:
Journal Reference Title
Sci Rep 2024 V ol. 14 Issue 1
Pages 9032 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Narazaciclib, a novel multi-kinase inhibitor with potent activity against
CSF1R, FLT-3 and CDK6, shows strong anti-AML activity in defined
preclinical models
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Journal Reference Title
Journal for ImmunoTherapy of
Cancer 11 (Supplement 1)
(2023): 563-563 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
502 Discovery of HX017, a novel NKG2A/CD94 mAb, for potential cancer
immunotherapy
Cancer Research
83.7_Supplement (2023):
6345-6345 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Non-clinical pharmacology of HX009, a novel FIC PD-1/CD47 BsAb
Scientific Reports 13.1 (2023):
5419 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
HX009, a novel BsAb dual targeting PD-1/CD47, demonstrates potent anti-
lymphoma activity in preclinical models
Cancer Research
83.7_Supplement (2023):
5665-5665 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
HX301 (ON1232580) a novel kinase inhibitor with potent activity against
CSF1R and FLT-3, shows strong anti-AML activity in defined preclinical
models
Cancer Research
83.7_Supplement (2023):
2980-2980 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
HX009, a first-in-class PD-1/CD47 BsAb, demonstrated anti-AML activity in
PDX models
Cancer Research
83.7_Supplement (2023):
497-497 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
HX301, a first-in-class ARK5i, demonstrates antitumor activity in preclinical
HCC models with high ARK5/Myc expression
Journal for ImmunoTherapy of
Cancer 11 (Supplement 1)
(2023): 617-617 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
543 Cis-binding/blockade of CD47 by CD47xPD1 BsAb HX009 enhanced
PD-1 blockade induced T cell activation
European Journal of Cancer 174
(2022): S122-S123 /H1118/H1118/H1118/H1118/H1118/H1118/H1118
HX301, a potent CSF1R inhibitor, suppresses tumor associated M2
macrophage (TAM), enhancing tumor immunity and causing transit tumor
inhibition in syngeneic EMT-6 tumors
European Journal of Cancer 174
(2022): S18 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
HX301 (ON123300) shows broad antitumor activity in preclinical mantle cell
lymphoma models, inclusive of those resistant to BTKi
Journal for ImmunoTherapy of
Cancer 10 (Supplement 2)
(2022): A512-A512 /H1118/H1118/H1118/H1118/H1118/H1118
491 Preclinical pharmacology modeling of HX009, a clinical stage first-in-
class PD-1xCD47 BsAb, for anti-lymphoma applications
Journal for ImmunoTherapy of
Cancer 10 (Supplement 2)
(2022): A116-A116 /H1118/H1118/H1118/H1118/H1118/H1118/H1118
106 Development of RO assay for anti-PD-1 mAb and anti-PD-1× CD47
BsAb utilizing hPD-1/hCD47 dual humanized mice, at preclinical setting
to facilitate clinical validation
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Journal Reference Title
Journal of Clinical Oncology
V olume 39, Number
15_Supplement (2021): 2517-
2517 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
First-in-human phase 1 dose escalation study of HX009, a novel recombinant
humanized anti-PD-1 and CD47 bispecific antibody, in patients with
advanced malignancies
Taylor & Francis, 2020, 12(1):
1724751. /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
HX008: a humanized PD-1 blocking antibody with potent antitumor activity
and superior pharmacologic properties//mAbs
ENVIRONMENTAL, SOCIAL, HEALTH AND SAFETY MATTERS
Governance
We are committed to environmental protection and promoting corporate social
responsibility and best corporate governance practices to develop sustainable value for
stakeholders and take up responsibilities as a corporate citizen.
We are committed to complying with PRC regulatory requirements, preventing and
reducing hazards and risks associated with our operation, and ensuring the health and safety of
our employees and surrounding communities. We will comply with the environmental, social
and governance (“ ESG”) reporting requirements after Listing and the responsibility to publish
ESG report on an annual basis in accordance with Appendix C2 to the Listing Rules. We will
focus on each of the areas as specified in Appendix C2 to the Listing Rules to analyze and
disclose important ESG matters, risk management and the accomplishment of performance
objectives, particularly those environmental and social issues that could have a material impact
on the sustainability of our operations and that are of interest to our Shareholders. We have
adopted company-wide environment, health and safety policies and various systems and
procedures relating to hazardous waste management, wastewater treatment, air pollution
control, environmental risk management, emergency response and process safety management.
We have also adopted and maintained a series of rules, standard operating procedures and
measures to maintain a healthy and safe environment for our employees. We implement safety
guidelines setting out information about potential safety hazards and procedures for operating.
We require new employees to participate in safety training to familiarize themselves with the
relevant safety rules and procedures. Also, we have adopted relevant policies and measures to
ensure the hygiene of our work environment and the health of our employees.
Environmental Protection
We endeavor to reduce negative impact on the environment through our commitment to
energy saving and sustainable development. We actively promote the idea of a paperless
workplace, and we encourage double-sided printing of documents in our office. With our future
business expansion, we focus on the balance between business growth and the need of ESG to
achieve sustainable development. The relevant material metrics for our resource consumption
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will be reviewed regularly to ensure that they remain appropriate to the needs of our Group.
While we appreciate that the identification and prioritization of ESG-related issues is a
dynamic and on-going process, we will build the following targets as our initial focuses:
 To reduce the level of power and water consumption density;
 To advocate green office and make full use of natural lighting, and provide energy-
efficient solutions for air conditioning;
 To strictly abide by the laboratory treatment implementation standards; and
 To provide ESG-related training for our staff members, with at least two working days per
person per year.
As we are currently at an early stage of laboratory operations and partially rely on CROs
for testings, clinical trials and other activities, the current nature of our business does not
expose us to a substantial risk of environmental, health or work safety matters, and we do not
expect the potential risks of such matters will have a material adverse impact on our business
operation and financial performance. In the upcoming future, our relevant expenses regarding
environmental, social, and climate-related issues are estimated to increase, along with our
overall business development, however, the proportion of such expenses against our total
revenue is estimated to trend downwards.
During the Track Record Period and up to the Latest Practicable Date, we had not
received any fines or penalties associated with the breach of any environmental laws or
regulations. To the best knowledge and belief of our Directors, we are not subject to material
environmental liability risk and will not incur material compliance costs in the future.
Resource Consumption and Pollutant Disposals
Our Board sets targets for each material ESG-related key performance indicators
(“KPIs ”) in accordance with the disclosure requirements of Appendix C2 to the Listing Rules
and other relevant rules and regulations upon Listing. In setting targets for the ESG-related
KPIs, our Group has taken into account their respective historical levels for the year ended
December 31, 2023 and 2024 and has considered our future business expansion thoroughly and
prudently with a view of balancing business growth and environmental protection to achieve
sustainable development. We will also review our KPIs on a yearly basis to ensure that they
remain appropriate to our Group. Set forth below are our major KPIs during the Track Record
Period:
 Electricity consumption . We have monitored our electricity consumption levels and
implement measures. In the years ended December 31, 2023 and 2024 and the eight
months ended August 31, 2024 and 2025, our electricity consumption levels were
approximately 87,674.0 kWh, 221,254,605 kWh, 151,479.0 kWh and 187,501.0 kWh
respectively.
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 Water consumption . We have monitored our water consumption levels and implement
measures to promote water conservation. For the period from January to August 2023, we
did not keep record of our water consumption level because we were exempted from
paying the water bill due to the investment bring-in policies of the industrial park we
located at. For the period from September to December 2023, the year ended December
31, 2024, and the eight months ended August 31, 2024 and 2025, we recorded water
consumption level of approximately 196.0 tons, 619.0 tons, 401.0 tons and 1,590.0 tons,
respectively.
 Hazardous waste disposal . We have monitored our hazardous waste disposal levels on a
periodic basis. We have a safety administrator who monitors and manage our hazardous
waste storage and disposal. We have also contracted with qualified third-party waste
disposal company for the disposal of hazardous material and waste. In the years ended
December 31, 2023 and 2024 and the eight months ended August 31, 2024 and 2025, our
hazardous waste discharge levels were approximately 841.0 kilograms, 406.0 kilograms,
447.0 kilograms and 395.0 kilograms, respectively.
In addition, we have implemented a comprehensive guideline and policies to enhance
monitor CROs in handling of hazardous material and wastes, including: (i) foster open
communication with CROs to discuss any concerns, challenges, or questions related to
hazardous materials and waste management, encouraging CROs to share best practices and
lessons learned to continuously improve safety and compliance; (ii) establish a flexible and
convenient reporting system for CROs to document and report any incidents, accidents, or near
misses involving hazardous materials and wastes; and (iii) continuously refine and update our
guidelines, protocols, and/or training programs to ensure they remain effective and relevant.
 Establish clear guidelines and protocols : We have developed and provided
comprehensive guidelines and protocols for CROs to follow when handling hazardous
materials and wastes, which cover a wide range of stages in clinical trials including safe
storage, transportation, disposal, and reporting procedures.
 Conduct regular audits and inspections : We perform periodic on-site audits and
inspections of CRO facilities to ensure compliance with the established guidelines and
regulatory requirements, which includes checking for proper storage, labeling, and
handling of hazardous materials and wastes.
 Provide training and education : We offer training and educational programs for CRO
staff to ensure they are knowledgeable about the safe handling, use, and disposal of
hazardous materials and wastes, which includes providing information on relevant
regulations, best practices, and emergency response procedures.
 Implement a reporting system : We have established a reporting system for CROs to
document and report any incidents, accidents, or near misses involving hazardous
materials and wastes. This system should include clear reporting guidelines and a process
for investigating and addressing any issues that arise.
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 Monitor regulatory compliance : We keep staying informed about changes in regulations
and ensure that CROs are aware of and adhere to these requirements, which involve
regular communication with regulatory agencies and participation in industry-specific
conferences or workshops.
 Evaluate performance : We regularly assess the performance of CROs in handling
hazardous materials and wastes through a combination of audits, inspections, and review
of incident reports. We use this information to identify areas for improvement and provide
feedback to the CROs.
 Maintain open communication : We foster open communication with CROs to discuss any
concerns, challenges, or questions related to hazardous materials and waste management,
encouraging CROs to share best practices and lessons learned to continuously improve
safety and compliance.
 Enforce consequences for non-compliance : We have establish consequences for CROs
that fail to comply with guidelines, protocols, or regulatory requirements, which include
fines, penalties, or termination of the contract, depending on the severity of the
non-compliance.
 Continuously improve processes : We use the information gathered from audits,
inspections, and incident reports to identify areas for improvement in your monitoring
processes. Continuously refine and update our guidelines, protocols, and training
programs to ensure they remain effective and relevant.
Greenhouse Gases Emissions
We aim to reduce our greenhouse gases (“ GHG”) emissions and contribute to the
transition to a low-carbon economy. We adhere to the “3R” approach to environmental
conservation, i.e., reduction of waste, reuse of resources and recycling of used materials, to the
extent possible in our business operation. The GHG emissions of various scopes are
respectively generated from the fuel consumption of vehicles of our Group (Scope 1), power
consumption (Scope 2), water consumption, waste discharge, paper consumption and GHG
emission resulting from the business travel of our employees (Scope 3) during business
operation. Our Group’s GHG emission results principally from Scope 2 energy indirect GHG
emission which is power consumption to support our operations, and Scope 3 other indirect
emissions.
We will implement measures in mitigating the GHG emissions, including (i) providing
trainings and educating our employees on the concept of energy efficiency; (ii) posting
water-saving or power-saving signs in eye-catching areas to cultivate our employees’
awareness of environment protection; (iii) promoting paperless environment and encouraging
the usage of electronic copies instead of hard copies, the use of double-sided printing, and the
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use of single-sided printed paper when there is no confidential information on it; (iv) requiring
employee to turn off all electrical appliances when they are not in use; and (v) implementing
policies regarding waste management.
Climate-related Risks
We believe that we are not susceptible to climate change. Moreover, we consider that
potential changes to the regulations in the PRC regarding climate change will not adversely
impact our business operations. We will continue to pay attention to risks regarding climate
change and formulate emergency plans to safeguard us from climate change and extreme
weather conditions, such as hurricane and rainstorms. As of the Latest Practicable Date, we had
not experienced any material impact on our business operations or financial performance as a
result of climate change or extreme weather conditions.
Employee Health and Safety
We have adopted and maintained a series of rules, standard operating procedures, and
measures to maintain our employees’ healthy and safe environment. We implement safety
guidelines that detail potential safety hazards, safe practices, accident prevention and accident
reporting procedures, and we ensure that our employees properly acknowledge their
understanding of safety matters on an ongoing basis as necessary. In particular, we (i) establish
various guidelines governing laboratory procedures and the handling, use, storage, treatment
and disposal of hazardous materials and wastes to ensure such guidelines are strictly enforced
for the disposal of laboratory materials and wastes; (ii) provide regular safety awareness
training to our employees, such as training sessions on fire control and safety; (iii) keep health
records for all employees and conduct health examinations before, during and after their time
at the company, especially for employees engaged in work involving occupational hazards; and
(iv) conduct regular fire safety inspections, maintenance of fire-fighting equipment and regular
emergency drills.
Workforce Welfare and Diversity
Within our organization, we are committed to creating an open and inclusive workplace
that promotes equality. We hire employees based on their merits and it is our corporate policy
to offer equal opportunities to them regardless of gender, age, race, religion or any other social
or personal characteristics. We adhere to a fair and transparent employee management system
and strive to enhance gender and age diversity of our workforce.
We established human resources management policies that systematically outline the
recruitment processes, promotion procedures, dismissal/resignation processes, performance
evaluation approaches, retention strategies, salary and benefits procedures, employee training,
etc. We implement a merit-based hiring approach with a view to making sure our recruitment
is based on the principles of openness, fairness, and equity.
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Supply Chain Management
Our suppliers primarily include raw material suppliers and contract services providers.
Our considerations in supply chains include technical quality, cost effectiveness, delivery
efficiency and reliability. Accordingly, we define risks related to supply chains consisting of
shortage of raw materials, workforce health and safety incidents, proper disposal of hazardous
waste, and internal control for corruption and bribery.
To identify and cope with any potential risks, we established procurement management
policies that clearly define the overall review and regular evaluation processes for suppliers,
based on which we made a qualified supplier list and update the list from time to time.
Additionally, we established management policies in relation to procurement of technical
contract services that specifies the responsibilities for the service providers, including CROs,
testing organizations, clinical trial centers, etc. The policies also outline due diligence
procedures, selection criteria, approval process, performance management and payment
settlement. Furthermore, we tend to opt for scaled suppliers that are public companies as we
believe such partners are subject to stricter compliance standards and capable of offering more
environmentally-friendly products and services. We have also implemented strict
anticorruption and anti-bribery policies to prevent collusion and corruption.
Governance on Environment, Health and Safety (EHS) Matters
We have engaged an external EHS service provider. They work with our senior
management on overseeing our compliance with EHS related regulations and policies, and
monitoring our implementation of related internal measures, such as: (i) adopting appropriate
safety measures at our facilities and implementing best practice procedures; (ii) conducting
regular safety awareness training to our employees; (iii) inspecting our facilities regularly to
identify and eliminate any potential safety hazards; (iv) adopting appropriate procedures
regarding the disposal of any hazardous waste such as Waste Management Procedure, which
aims to effectively manage the waste generated during our normal course of business,
standardize the classification of the waste into solid waste and hazardous waste according to
the relevant laws and regulations and dispose them accordingly to reduce environmental
pollution; (v) maintaining a system of recording and handling accidents in our facilities; and
(vi) cooperating with regulatory authorities for the regular environmental compliance
monitoring. Our external EHS service provider may assess or engage independent third
party(ies) to evaluate the ESG risks and review our existing strategies, targets and internal
controls at least once a year. Necessary improvement will then be implemented to mitigate the
risks.
Our senior management, alongside our external EHS service provider, implement the
national and our own safety production and environmental protection guidelines, and follow up
with the instructions or notice from local authorities with regard to fire protection, safety
supervision and environmental protection in a timely manner, as well as formulate our
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Company’s safety production policies and operating procedures. The management personnel at
all levels and all of our employees will implement the work responsibility system according to
EHS related regulations and policies, and related internal measures.
Patient Safety
During the clinical study period, if the subjects experience any discomfort, new changes
in their condition, or any unexpected situations, regardless of whether they are related to the
drug, investigators will provide necessary treatment to the subjects and closely follow up on
their health conditions. If the subjects experience serious adverse events during the clinical
study, investigators will examine them and provide appropriate treatment. In the event of any
damage related to the clinical study during the research period, the subjects will be
compensated in accordance with the relevant laws and regulations and insurance policies
sponsor purchased for such clinical trial liabilities. At the same time, according to the clinical
study plan, the subjects shall return to the research center regularly for visits, during which
relevant safety tests will also be arranged.
Social Responsibility
In respect of social responsibilities, it is our corporate policy to offer equal opportunities
to our employees regardless of gender, age, race, religion or any other social or personal
characteristics. We strive to operate our facilities in a manner that protects the environment and
the health and safety of our employees and communities.
INSURANCE
We maintain insurance policies that we consider to be in line with market practice and
adequate for our business to safeguard against risks and unexpected events. Our insurance
policies cover us against liability in the event of injury to any trial subject caused by adverse
events in our clinical trial.
We maintain social insurance for our employees in accordance with relevant PRC laws
and regulations. We consider that the coverage from the insurance policies maintained by us
is adequate for our present operations and is in line with the industry norm. During the Track
Record Period and up to the Latest Practicable Date, some of our Group companies did not pay
social insurance for their employees on the contribution bases determined on their actual
salaries, which resulted in an under-payment of RMB1.3 million, RMB0.6 million, RMB0.7
million and RMB0.8 million for the years ended December 31, 2023, and 2024 and the eight
months ended August 31, 2024 and 2025, respectively. Any failure to make timely and adequate
social welfare contribution for its employees may trigger an order of correction from
competent authority requiring the employer to make up the full amount of such overdue social
welfare contribution within a specified period of time, and the competent authority may further
impose fines or penalties.
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On September 21, 2018, the Ministry of Human Resources and Social Security of the PRC
issued the Urgent Notice on Enforcing the Requirement of the General Meeting of the State
Council and Stabilization the Levy of Social Insurance Payment (஫࿏ໝྼ਷ਕ৫੬ਕ
). This notice promotes an appropriate
reduction in the social insurance contribution rate for employers to ensure that the overall
contribution burden on enterprises is not increased. It also prohibits the organization of
centralized collection of enterprises’ historical social insurance arrears without authorization.
As of the Latest Practicable Date, the Company has not been required to pay late fees,
fines or suffer administrative penalties in connection with social insurance contributions. If the
competent authorities require the company to make corrections, pay or make up for social
insurance premiums within a specified time limit in the future, or if employee complaints
occur, the Company will actively cooperate with the requirements of the competent authorities
to fulfill relevant obligations, ensuring that the Company will not be subject to administrative
penalties by the competent authorities due to failure to pay within the time limit and/or
employee complaints.
According to the Interpretation II by the Supreme People’s Court of the PRC on Legal
Issues in the Trial of Labor Dispute Cases (ਪᕚ
༆ᙑ(ɚ)) (the “ Interpretation ”), promulgated by the Supreme People’s Court on August 1,
2025 and effective from September 1, 2025, any agreement between a PRC employer and an
employee or an employee’s undertaking to the employer on the non-contribution of social
insurance shall be deemed invalid by the people’s court. If an employee requests to terminate
the employment agreement and seek economic compensation on the grounds that the employer
has failed to pay social insurance contributions in accordance with the applicable laws, the
people’s court shall support such claims.
As advised by the PRC Legal Advisor, the Interpretation does not expand the scope of
penalties nor override existing laws and regulations. Under the current laws and regulations,
given that the Company undertakes and guarantees it will make timely supplementary
payments in accordance with the requirements of the relevant authorities upon receiving a
social insurance contribution notice from the competent department, the risk of the Company
being subject to fines from the competent authorities due to the aforementioned matters after
the implementation of the Interpretation remains relatively small. Therefore, the Company
believes that the implementation of the Interpretation will not have a material adverse impact
on its business operations and financial condition. For details, please refer to “Risk Factors —
Risks Relating to Our Operations — We may be subject to additional social insurance fund and
housing provident fund contributions and late fees or fines imposed by relevant regulatory
authorities” in this prospectus. Relevant internal control policies about the social insurance
fund, housing provident fund contributions and leased properties have been developed and
issued. The corresponding responsible positions and responsibilities are also clearly defined in
the policy. The Senior Manager of HR/Administration is responsible for compliance of the
social insurance fund, housing provident fund contributions and registration of leased
properties according to our internal policies. And the internal audit department also monitors
ongoing compliance with the social insurance fund, housing provident fund contributions and
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leased properties and oversee the implementation of any necessary measures. In addition, we
will consult our legal advisor on regular basis for advice on relevant PRC laws and regulations.
We will also maintain close communication with relevant authorities on a regular to update
with the latest laws and regulations. We expect to complete the full compliance of social
insurance contributions for all on-the-job employees since January 1, 2026. We believe that
these non-compliance will not have any material adverse impact to our operation and financial
performance, and we expect to rectify the social insurance fund, housing provident fund
contributions after the Listing.
LICENSES AND PERMITS
Our PRC Legal Adviser has advised that, as of the Latest Practicable Date, we have
obtained all licenses, permits, approvals and certificates from the relevant PRC government
authorities that are material to our operations in the PRC.
The following table sets forth details of selected material licenses and permits obtained
by our Group as of the Latest Practicable Date:
License/Permit Product Grant Date Issuing Authority Holder
Approval for Clinical Drug Trial (ᑗ
ґ༊᜕ҭ΁) (No. 2017L04642)
HX008 monotherapy August 28,
2017
NMPA Taizhou Hanzhong,
Hangzhou Hanx
and Zhongshan
Kangfang
Acknowledgement of CT-2019-CTN-
01930-1 Clinical Trial for Advanced
Malignancies /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
HX009 monotherapy July 17, 2019 TGA HanxBio
(Australia)
Notice of Approval for Clinical Drug
Trial (ࣣٝ)
Acceptance No. CXSL1900098) /H1118/H1118/H1118/H1118
HX009 monotherapy October 30,
2019
NMPA Hangzhou Hanx
and Wuhan
Hanxiong
Notice of Approval for Clinical Drug
Trial (ࣣٝ)
Acceptance No. CXHL1900340) /H1118/H1118/H1118/H1118
HX301 monotherapy January 6,
2020
NMPA Hangzhou Hanx
and Wuhan
Hanxiong
Decision on Approval of International
Cooperative Scientific Research on
Human Genetic Resources in China
(No. (2022) GH0316) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
N/A February 7,
2022
Administration Office
of China Human
Genetic Resources
Hangzhou Hanx
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License/Permit Product Grant Date Issuing Authority Holder
Study May Proceed Approval for Clinical
Drug Trial (No. 163935) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
HX009 monotherapy May 18, 2023 FDA Hangzhou Hanx
Decision on Approval of International
Cooperative Scientific Research on
Human Genetic Resources in China
(No. (2023) GH3403) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
N/A June 30, 2023 Administration Office
of China Human
Genetic Resources
Hangzhou Hanx
Notice of Approval for Clinical Drug
Trial (ࣣٝ)
Acceptance No. CXHL2400534) /H1118/H1118/H1118/H1118
HX301 combination August 19,
2024
NMPA Hangzhou Hanx
Decision on Approval of International
Cooperative Scientific Research on
Human Genetic Resources in China
(No. (2024) GH0130) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
N/A February 7,
2024
Administration Office
of China Human
Genetic Resources
Hangzhou Hanx
Notice of Approval for Clinical Drug
Trial (ࣣٝ)
Acceptance No. CXSL2400419) /H1118/H1118/H1118/H1118
HX009 combination September 3,
2024
NMPA Hangzhou Hanx
Acknowledgement of CT-2024-CTN-
05006-1 Clinical Trial for Advanced
Solid Tumor Malignancies /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
HX044 monotherapy September 30,
2024
TGA Hanx
Biopharmaceuticals
(Australia)
Notice of Approval for Clinical Drug
Trial (ࣣٝ)
Acceptance No. CXSL2400783) /H1118/H1118/H1118/H1118
HX044 monotherapy January 24,
2025
NMPA Our Company
Notice of Approval for Clinical Drug
Trial (ࣣٝ)
Acceptance No. CXSL2400830) /H1118/H1118/H1118/H1118
HX009 combination February 17,
2025
NMPA Hangzhou Hanx
Notice of Approval for Clinical Drug
Trial (ࣣٝ)
Acceptance No. CXSL2500595) /H1118/H1118/H1118/H1118
HX044 combination September 28,
2025
NMPA Our Company
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LEGAL PROCEEDINGS AND COMPLIANCE
We may from time to time be involved in contractual disputes or legal proceedings arising
out of the ordinary course of business or pursuant to governmental or regulatory enforcement
actions. During the Track Record Period and up to the Latest Practicable Date, neither we nor
any of our Directors were involved in or subject to any material litigation, arbitration,
administrative proceedings, claims, damages or losses which would have a material adverse
effect on our business, financial position or results of operations as a whole. As of the Latest
Practicable Date, we were not aware of any pending or threatened material litigation,
arbitration or administrative proceedings against us or any of our Directors, which individually
or as a whole would have a material adverse effect on our business, financial position or results
of operations. During the Track Record Period and up to the Latest Practicable Date, we had
complied, in all material respects, with relevant PRC laws and regulations in the jurisdictions
we operate in, and no material administrative penalties were imposed on us that would have a
material adverse effect on our business, financial position or results of operations.
RISK MANAGEMENT AND INTERNAL CONTROL
We have devoted ourselves to establishing and maintaining risk management and internal
control systems which comprise policies and procedures that we consider to be appropriate for
our business operations, and we are dedicated to continuously improving these systems.
Risk Management
We are exposed to various risks in our business operations and we recognize that risk
management is critical to our success. For more details, please refer to the section headed “Risk
Factors” for a discussion of various operational risks and uncertainties we face. We are also
exposed to various market risks, in particular, credit, liquidity, interest rate and currency risks
that arise in the normal course of our business. Please refer to “Financial Information —
Market Risk Disclosure” for a discussion of these market risks. We have adopted a series 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.
Risks identified by management will be analyzed on the basis of likelihood and impact, and
will be properly followed up and mitigated and rectified by our Company and reported to our
Directors. Our audit committee, and ultimately our Directors supervise the implementation of
our risk management policies.
To monitor the ongoing implementation of risk management policies and corporate
governance measures after Listing, we have adopted or will adopt, among other things, the
following risk management measures:
 establish an audit committee to review and supervise our financial reporting process and
internal control system;
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 adopt various policies to ensure compliance with the Listing Rules, including but not
limited to aspects related to risk management, connected transactions and information
disclosure; and
 attend training sessions in respect of the relevant requirements of the Listing Rules and
duties of directors of companies in Hong Kong.
Intellectual Property Risk Management
As of the Latest Practicable Date, we have designed and adopted prudent internal
procedures to ensure the compliance of our business operations with the relevant rules and
regulations, as well as the protection of our intellectual property rights.
In accordance with these procedures, we have been engaging external legal counsel in
reviewing and updating the contract boilerplate we enter into with our customers and suppliers.
Our business operation departments also work closely with the external legal counsel to
examine the specific contract terms and reviews all relevant documents for our business
operations, including licenses and permits obtained by the counterparties or us to perform
contractual obligations and all the necessary underlying due diligence materials, before we
enter into any contract or business arrangements.
We also engage external intellectual property legal counsel to review our products and
services for regulatory compliance before they are made available to the general public. Our
external intellectual property legal counsel assist in obtaining any requisite governmental
pre-approvals or consent, including preparing and submitting all necessary documents for
filing with relevant government authorities within the prescribed regulatory timelines and
ensuring all necessary application, renewals or filings for trademark, copyright and patent
registration have been timely made to the competent authorities.
Internal Control
Our Board is responsible for establishing our internal control system and reviewing its
effectiveness. We have engaged an independent internal control consultant (the “ Internal
Control Consultant ”) to perform the agreed-upon procedures (the “ Internal Control
Review ”) in connection with the internal control in material aspects, including entity-level
controls, financial reporting and disclosure controls, human resources and payroll
management, general controls of IT system and other procedures of our operations. The
Internal Control Consultant performed the Internal Control Review and identified internal
control deficiencies and furnished recommendation accordingly. We have adopted the
corresponding remediation actions to improve the effectiveness of our internal control system.
The Internal Control Consultant performed a follow-up review in October 2024 with regard to
those actions taken by us and there are no further material findings identified in the process of
the follow-up review. The Internal Control Consultant is of the view that (i) our Company has
adopted the corresponding remediation actions to rectify all internal control deficiencies and
(ii) our Company’s overall internal control system does not have any material deficiencies.
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During the Track Record Period, we reviewed and enhanced our internal control system
on a regular basis. 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 material aspect of our
business operation, such as risk management, protection of intellectual property,
environmental protection and occupational health and safety. We provide periodic
training about these measures and procedures to our employees as part of our employee
training program. We monitor the implementation of our internal control policies, report
the weakness identified to our management and audit committee and follow up on the
rectification actions.
 Our Directors (who are responsible for monitoring the corporate governance of our
Group) will also periodically review our compliance status with all relevant laws and
regulations after the Global Offering.
 We have established an audit committee which, among others, (i) makes
recommendations to our Board of Directors on the appointment and removal of external
auditors; and (ii) reviews the financial statements and internal control system of our
Company.
 We plan to provide various and continuing trainings to update our Directors, senior
management, and relevant employees on the latest applicable laws and regulations from
time to time with a view to proactively identifying concerns and issues relating to
potential non-compliance.
 We intend to maintain strict anti-corruption and anti-bribery policies and we believe we
will not be adversely affected in material aspects by the stringent measures taken by the
local government to regulate corruptive practices in the pharmaceutical industry.
Anti-bribery
We adhere to a rigorous ethical code and policies against corruption, which we expect to
be strictly observed by our staff and business partners. We are confident that our adherence to
these principles will minimize any impact from the rigorous anti-corruption measures may be
implemented by the regulatory authorities to address unethical practices in the pharmaceutical
sector. We have a zero-tolerance policy for bribery and any form of illicit payments within the
scope of our business operations. This extends globally to all of our business dealings,
regardless of whether they involve interactions with public officials or healthcare providers.
The definition of improper payments under this policy encompasses a broad range, including
but not limited to, bribes, kickbacks, lavish gifts or entertainment, and any form of payment
made with the intent to secure an unfair business benefit. We are committed to maintaining
precise and detailed financial records that accurately represent our transactions and asset
disposals. We encourage the rejection and immediate reporting of any requests for falsified
invoices or payments for expenses that are unusual, excessive, or not properly documented.
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Any form of deception, omission, or falsification in our financial records is strictly prohibited.
Furthermore, we are dedicated to ensuring that our employees adhere to all relevant
promotional and advertising regulations, which include, but are not limited to, restrictions on
the promotion of pharmaceuticals for unauthorized uses or to unsuitable patient groups, and
limitations on industry-sponsored scientific and educational programs.
Conflict of Interest and Non-Competition
Our ethical guidelines explicitly outline the boundaries of potential conflicts of interest,
covering aspects such as interactions with suppliers, the acceptance of hospitality and gifts,
personal financial interests, and staff-related decisions. It is imperative that our workforce,
including directors and research and development personnel, do not hold or appear to hold
vested interests in transactions with our suppliers or business partners; receive monetary or
other forms of benefits from these parties; have immediate family members employed by the
aforementioned entities; or hold consultancy or board positions within organizations in the
same or related industries. Concurrently, employees are obligated to maintain the utmost
discretion regarding confidential information and concur on the delineation of such
information, the extent of its coverage, and the utilization of intellectual assets, which
encompasses but is not limited to, the transfer of expertise, technology acquisitions, and
liabilities related to potential breaches.
In addition, our employment contracts feature covenants that prevent staff from
participating in, or aiding third parties in engaging in activities that are identical or similar to,
or in competition with our Company’s business for a duration of two years following the
termination of their employment. Members of our workforce are precluded from owning,
managing, operating, or exerting control over any rival entities without obtaining prior written
consent from our Company.
Data Privacy Protection
We have put in place protocols aimed at safeguarding the privacy of our patients’
information. We enforce rigorous internal guidelines that govern the acquisition, management,
storage, and retrieval of patients’ personal and medical data, dedicating to the protection of
personal information and adherence to applicable PRC data protection and privacy legislation.
The conduct of drug clinical trials shall adhere strictly to the requirements of the “Good
Clinical Practice (GCP)” guidelines in the PRC. As the sponsor of clinical trials, our Company
has established a clinical trial quality management system in accordance with GCP standards
to standardize the methods and procedures for collecting data related to clinical trials and
subjects. We utilize localized secure information systems to store the aforementioned data. We
also have developed a comprehensive set of data security management systems and operational
procedures, implemented relevant technical security measures, enforced strict controls over
data access permissions, established network and data security monitoring mechanisms, and
taken preventive measures against behaviors that may compromise network security and data
integrity, thus avoiding risks of data breaches, alterations, and losses, among other security
risks.
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It is our standard practice to instruct our staff to protect any personal information
gathered under their control. Our IT infrastructure is fortified with advanced security measures
to protect our information systems and servers. We have also adopted a range of security
protocols to defend our data assets and forestall unauthorized network intrusions. In
accordance with the ICH GCP and associated regulations, access to data from clinical trials is
restricted to personnel with proper authorization. To enhance the management of our network
operation and data security, we have delegated specific employee to be responsible for routine
maintenance, access control, security measures, and other administrative tasks related to the
network and information systems.
Additionally, we have confidentiality agreements in place with employees who have
access to sensitive patient information. These agreements stipulate, among other provisions,
that these individuals are legally bound not to abuse confidential information while employed,
to return all such information upon resignation, and to continue to honor their confidentiality
obligations after their employment ends. We also have a suite of measures in place to ensure
employee adherence to our data security protocols, which includes granting and withdrawing
data access rights to our staff following a strict approval process, so that to strictly limited the
data usage to the intended purposes as agreed upon with the patients and in line with the
informed consent documents.
Furthermore, we engage clinical trial partners (for example, the contract research
organizations) that meet the relevant regulatory and registration requirements. Through the
execution of contracts with our clinical trial partners, we clearly define the responsibilities of
each party. It is stipulated that all parties shall comply with GCP requirements, protect the
privacy of subjects involved in the trials, refrain from using trial data for other purposes, and
maintain trial data in accordance with GCP standards. We also reserve the right to appoint
monitors to oversee the clinical trials, ensuring the protection of the rights and interests of
patients, the accuracy and completeness of the data in trial records and reports, and the
adherence of the trials to the agreed protocols, GCP guidelines, and relevant regulations.
Throughout the Track Record Period and up to the Latest Practicable Date, we have not
encountered any breaches of confidential client information or any incidents involving client
information that may have a significant negative impact on our business operations, financial
positions, or operational outcomes. Our PRC Legal Adviser has confirmed that during the
Track Record Period and up to the Latest Practicable Date, our Company has not faced any
significant penalties related to data privacy, and has remained in compliance with all material
aspects of the relevant PRC laws and regulations.
The Sole Sponsor has conducted independent due diligence work, including (i) reviewed
the clinical data due diligence report and conducted expert interview with Frost and Sullivan,
who is the Clinical Data Consultant engaged by the Company, to understand the scope and
integrity of patient-related information and data involved in clinical trial and their opinion; (ii)
reviewed certain contracts of the Group with relevant partners and conducted interview with
them including the PIs and CROs, to understand what are the patient-related information and
data involved and how these data are transferred and protected; (iii) obtained and reviewed the
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data security legal opinion issued by the PRC Legal Adviser of data compliance of the
Company; (iv) conducted interview with the PRC Legal Adviser of data compliance to
understand the methodology and basis of their opinion; and (v) reviewed the background
search results conducted by an independent search agent against the Group and no litigation or
proceedings is found in respect of any breach of data security and non-compliance.
Based on the view of our PRC Legal Adviser of data compliance and due diligence work
conducted by the Sole Sponsor, we confirm that our Company complied with all PRC laws and
regulation in relation to data transfer (including patient-related information and clinical data
generated from the clinical trials).
Misappropriation of funds by former employee of our Group
From around December 2016 to May 2020, Mr. Xi Gan (“ Mr. Xi ”), a former director and
general manager of Hangzhou Hanx; a former director, legal representative and manager of
Wuhan Hanxiong; and a former manager and legal representative of Beijing Hanx, was found
to have taken advantage of his position in Hangzhou Hanx and abused his administrative
authority to: (i) arrange for the finance department to execute false contracts with various
service providers or suppliers, and consequently causing false issue of value-added-tax
(“VAT”) invoices and misappropriated an amount of approximately RMB1.56 million; (ii)
illegally appropriated an amount of approximately RMB0.29 million by falsely claiming funds
in the name of his relatives at Hangzhou Hanx; and (iii) misappropriated RMB0.18 million to
lend to an employee of our Group based on false claim of travel disbursements by three
employees (collectively, the “ Incidents ”). Pursuant to the final judgement of Wuhan
Intermediate People’s Court, Hubei Province (ࣣ֛dated
April 28, 2022, Mr. Xi was convicted of the charges in relation to the Incidents and was fined
with a penalty of RMB200,000 and sentence to imprison for four years and eight months.
After the Incidents, our Company has implemented corresponding internal control
measures and the OA (Office Automation) system. Firstly, our official seal, legal representative
seal, and financial seal are now kept by different employees to avoid unauthorized procession
of the seals by the same employee. Secondly, since 2021, the Company has replaced the former
paper approval forms with OA (Office Automation) system, and the approval streams were set
based on the approval authority of different amounts in the OA system. Business streams,
including procurement, payments, contract chopping are now required to be approved in the
OA system for better corporate governance and documentary filing. Thirdly, the Company has
also established rules relating to expenses management, pursuant to which the employee is now
required to provide receipt for disbursement claim of RMB1,000 or more and apply to claim
the disbursement within six months of the date of the receipt. Prior application and approval
is also required if the entertainment expenses exceed a certain limit. Finally, we have
established reporting system for misbehavior of employees, anti-corruption and anti-money
laundering regulations for employees and has been working and being improved continuously
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since the Incident. Moreover, the paper policies about reporting system for misbehaviour of
employees, anti-corruption and anti-money were issued in 2024. The said report system,
includes the following detailed mechanisms:
i. Misconduct Reporting Mechanism and Management Procedures (ᑘజዚՓ
ၾ၍ଣ஝೻) has been issued and implemented by the Company, which stipulates the
reporting channels, investigation mechanisms, and punishment mechanisms for
misbehaviour of employees. In the meanwhile, all other forms of reporting to the
audit department of the Company are also encouraged. Our Company also provides
training programs to facilitate employees’ awareness of the above reporting system;
ii. employees and external stakeholders can report clues of misconduct to a reporting
email address with options for anonymity. Our Company has informed all employees
of the aforementioned reporting email address and reporting channel;
iii. our Company encourages whistle-blowing from all stakeholders while our Company
prohibits retaliation and ensures confidentiality; and
iv. clues of misconduct will be transferred to the audit department of our Company for
investigation. After the investigation is completed, the result of the investigation
shall be reported to our Company’s management team and the Audit Committee. The
report includes a brief overview of the case, the facts and nature of the violations,
evidence and investigation, personnel responsibilities, punishment advice,
management suggestions, etc. If our Company’s management team or the Audit
Committee believes that the case needs to be escalated to any judicial department,
our Company will escalate the case to such judicial department along with the
evidence collected.
There have been no instances of fraud, bribery, or other misconduct involving our
Company, its senior management and employees involving our Company since rectification of
the deficiencies. The Internal Control Consultant has reviewed internal control measures
mentioned above especially the samples of procurement and payment proof from January 2021
to August 2024. The Internal Control Consultant is of the opinion that no further material
findings have been identified.
During Mr. Xi’s tenure of office, he was mainly responsible for administrative work and
providing support to the clinical trial team of our Company. He has not been involved in the
research and development of any drug pipeline candidates of our Group nor been involved in
the material business and operation of our Group. No existing employee has been found to be
involved in the Incidents. Furthermore, our Group has enhanced its internal control measures.
Considering the above, our Company is of the view that the Incidents and the removal of Mr.
Xi from his positions in our Group did not have any material impact on the operation, research
and development and commercialization of the Core Product and product candidates of our
Group. Save for the Incident as stated above, our Group and any of its connected persons did
not have any other dispute with Mr. Xi as of the Latest Practicable Date.
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As of the Latest Practicable Date, Wuhan Hanzhong, which is owned as to 60% by Mr.
Xi and 40% by Ms. Xi Jingxuan (ẙ⥳), the daughter of Mr. Xi, is a minority shareholder of
Hangzhou Hanx, a subsidiary of our Company. Considering Mr. Xi was currently unreachable,
it may not be in the best interests of our Company to commence any negotiation in relation to
the acquisition of the equity interests in Hangzhou Hanx held by Wuhan Hanzhong with Mr.
Xi at this stage.
As advised by the PRC Legal Adviser, pursuant to the relevant PRC laws and regulations,
the named inventor of certain patents generally lacks the right to assert ownership of these
patents. The patents which Mr. Xi were named as an inventor would be likely to be classified
as service inventions, and ownership of these patents should belong to our Company according
to the applicable IP Law of the PRC.
As advised by the PRC Legal Adviser, pursuant to the relevant PRC laws and regulations,
“inventor” shall mean a person that makes a creative contribution to the essential features of
an invention or creation. Persons that are responsible only for organizing such work, who
facilitate only the use of materials and technical conditions, or who engage solely in other
support work during the course of the completion of an invention or creation are not inventors.
According to Article 14 of the Implementing Regulations of the Patent Law of the People’s
Republic of China (2023 Amendment) (ۆ2023ࠈࡌ)), an
“inventor” under the Patent Law refers to a person who has made creative contributions to the
substantive features of an invention-creation. This provision explicitly grants the right of
inventorship to individuals who have made creative contributions to the substantive features of
an invention-creation. Mr. Xi held the position of General Manager of Hangzhou Hanx and was
responsible for external liaison and coordination in clinical operations. Considering the need
to facilitate his efforts in promoting Hangzhou Hanx R&D pipeline and external collaboration
communications, the company included Mr. Xi as a registered inventor. Upon verification by
our Company, Mr. Xi did not contribute to the formation of the technical solutions of these
patents. In the event that Mr. Xi initiated a claim against our Company for the rewards and
remuneration from the patents where he was named as one of the inventors, considering he was
mainly focusing on the administrative work of our Company and had minimal contribution to
the invention of these patents, our Company considers that it could claim that Mr. Xi was not
a substantial inventor or had made minimal contribution to the invention of HX008. Mr. Xi’s
claim for rewards and remuneration will be very limited.
Mr. Xi, together with his daughter, Ms. Xi Jingxuan through his shareholding in Wuhan
Hanzhong, indirectly controls 15% of the subscribed capital contribution of Hangzhou Hanx.
As a shareholder of Hangzhou Hanx, Wuhan Hanzhong may exercise shareholder voting rights
and other rights in accordance with the Company Law of the People’s Republic of China and
the articles of association of Hangzhou Hanx. According to the articles of association of
Hangzhou Hanx, shareholders exercise voting rights at shareholders’ meetings in proportion to
their capital contributions. Specifically: (i) resolutions of the shareholders’ meeting regarding
increases or decreases in registered capital, division, merger, dissolution, or changes to the
Company’s form must be approved by shareholders representing more than two-thirds of the
voting rights; (ii) resolutions to amend the articles of association must be approved by
BUSINESS
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shareholders representing more than two-thirds of the voting rights; (iii) resolutions of the
shareholders’ meeting regarding the Company providing guarantees for shareholders or actual
controllers must be approved by a majority of the voting rights held by shareholders present
at the meeting, excluding the shareholders in question or those controlled by the actual
controller; and (iv) all other resolutions of the shareholders’ meeting must be approved by
shareholders representing more than half of the voting rights. Based on the above provisions
of Hangzhou Hanx’s articles of association, the PRC Legal Adviser is of the view that, except
for in the event of matters concerning guarantees provided by Hangzhou Hanx to shareholders
or actual controllers (which there was no such arrangement as of the Latest Practicable Date
as confirmed by the Directors), or other matters that may affect the interests of minority
shareholders, Wuhan Hanzhong, as a 15% shareholder of Hangzhou Hanx, will not have a
decisive influence over the decision-making matters of Hangzhou Hanx’s shareholders’
meeting through its voting rights. Based on the above, the Company considered that Mr. Xi is
not able to negatively affect the operations of Hangzhou Hanx and the Group.
Taking into account that risk of Mr. Xi adversely interfering with Hangzhou Hanx’s
operations remains relatively low based on the reasons above and Hangzhou Hanx has served
as our Group’s primary operating subsidiary since being acquired by the Company and has
historically acted as the major entity for executing agreements with external partners.
Transitioning our research and development platforms of its Core Product to another entity
would not only incur significant costs but also necessitate renegotiating contracts with third
parties, thereby imposing undue administrative and financial burden on our Group. Given
Hangzhou Hanx’s entrenched role in our Group’s operational framework and the cost needed
to be incurred for restructuring its research and development infrastructure at this stage, it is
respectfully submitted that retaining Hangzhou Hanx as the core platform for our Group’s
research and development activities remains appropriate for our Group.
BUSINESS
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OVERVIEW
Upon Listing, several transactions entered into between members of our Group and our
connected persons will constitute continuing connected transactions under Chapter 14A of the
Listing Rules.
SUMMARY OF OUR CONNECTED PERSONS
Waterstone Pharmaceuticals
Waterstone Pharmaceuticals is a company established in the PRC with limited liability on
December 17, 2009 and listed on the NEEQ (stock code: 873938). It is a company principally
engaged in the research and development and sales of chemical drugs for metabolic diseases
such as diabetes and kidney disease. Since its establishment, Dr. Zhang has been one of the
controlling shareholders of Waterstone Pharmaceuticals. For further details of the information
of Waterstone Pharmaceuticals, please refer to the paragraph headed “Relationship with our
Controlling Shareholders — Our Relationship with Waterstone Pharmaceuticals” in this
prospectus.
Hubei Waterstone Biopharmaceutical Technology Co., Ltd. (ࠢ
ʮ̡) (“Hubei Waterstone”)
Hubei Waterstone is a company established in the PRC with limited liability on January
31, 2008 and is principally engaged in the production and sales of pharmaceutical chemical raw
materials and pharmaceutical intermediates. It is a wholly-owned subsidiary of Waterstone
Pharmaceuticals.
FULLY-EXEMPT CONTINUING CONNECTED TRANSACTION
HX 301 Active Pharmaceutical Ingredients (“HX301 APIs”) Supply and Stability Testing
Services Framework Agreement (the “HX301 APIs and Stability Testing Services
Framework Agreement”)
We entered into the HX301 APIs and Stability Testing Services Framework Agreement
with Waterstone Pharmaceuticals on December 10, 2025, pursuant to which Waterstone
Pharmaceuticals and its subsidiaries (including Hubei Waterstone, together with Waterstone
Pharmaceuticals, the “ Waterstone Connected Persons ”) will supply to our Group (i) HX301
APIs; and (ii) provision of stability testing services in relation to the HX301 APIs.
HX301 is a novel therapeutic candidate under development and is one of our key
products. For further information of HX301, please refer to the paragraph headed “Business —
Clinical-stage Candidates — Key Product — HX301” in this prospectus.
CONNECTED TRANSACTIONS
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As confirmed by our Directors, as we lack the production facility and testing facility, we
have been conducting trials on HX301 APIs since 2020 from the Waterstone Connected
Persons. We intend to apply to NMPA for commercialization of HX301 APIs in around late
2029. We will also be required to submit the stability testing results, a test for the purpose of
establishing the stability characteristics of an API, for each batch of HX301 APIs we used since
2018 so as to determine the re-test period (i.e. the timeframe during which an API, under
specific storage conditions, is expected to maintain compliance with its stability quality
standards and could be used for manufacturing a given drug product, which is determined
based on the stability test results of APIs) of HX301 APIs when they are commercialized. As
confirmed by our Directors, we are also required to submit the stability testing results of at
least one batch of HX301 APIs per year after obtaining approval from NMPA in 2029. As our
Company lacks the production and testing facility, we therefore procured HX301 APIs and
stability testing services from Waterstone Connected Persons, who processed the production
and testing facility, during the Track Record Period and upon Listing.
Terms of the HX301 APIs and Stability Testing Services Framework Agreement
The initial term of the HX301 APIs and Stability Testing Services Framework Agreement
shall commence on the Listing Date until December 31, 2029 and may be renewed conditional
on the fulfillment of the relevant requirements under the relevant laws, regulations and the
Listing Rules.
Rule 14A.52 of the Listing Rules provides that the period for the agreement of a
continuing connected transaction must not exceed three years except in special circumstances
where the nature of the transaction requires a longer period. Our Directors are of the view that
the nature of HX301 APIs and Stability Testing Services Framework Agreement requires a
longer period commencing from the date of the agreement and continue to be in force until
December 31, 2029 on the grounds that: (i) a contractual arrangement of long term is necessary
and critical for the development of HX301 APIs, as the duration of the stability testing and the
results of which to be submitted to the authority would affect the re-test period of HX301 APIs
accepted by the authority for commercialization. As confirmed by our Directors, we have
completed a 5-year stability testing for batches of HX301APIs and evaluated their data,
including data of physical, chemical, and microbiological tests etc, once every 3, 6, 9, 12, 18,
24, 36, 48 and 60 months. The stability results, which will be submitted to the NMPA showed
that the HX301APIs meets the specification throughout the 5 years stability testing period.
Therefore, in line with the market practice, we intend to apply for approval of
commercialization of HX301 APIs with a re-test period of 5 years and therefor e a 5 years term
of HX301 APIs and Stability Testing Services Framework Agreement is necessary.
Furthermore, our Company lacks the equipment for conducting the stability testing of HX301
APIs. If the HX301 APIs and Stability Testing Services Framework Agreement is determined
at a shorter term, our Company may face the unnecessary and substantial risks of failing to
renew such agreement upon expiry of the agreement; (ii) given the above, such a long-term
CONNECTED TRANSACTIONS
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--- page 417 ---
cooperation is in the interest of our Company and the Shareholders as a whole; and (iii) as
confirmed by Frost & Sullivan, the term of the HX301 APIs and Stability Testing Services
Framework Agreement, which exceeds three years, is in line with the industry prevailing
practice.
Reasons for the transaction
The Waterstone Connected Persons have been engaging in the chemical small molecule
drugs industry. They process strong research and development capability in the area of small
molecule drugs, and its production factories have passed the GMP audits of the both foreign
and PRC regulatory authorities. Furthermore, during the Track Record Period, we have been
procuring HX301 APIs for the production of HX301 and stability testing services of the HX301
APIs, from the Waterstone Connected Persons. We will continue to procure such products and
services from the Waterstone Connected Persons as they have been providing us with such
products and services with standard and quality commensurate with our requisite safety and
quality standard. As such, we believe Waterstone Connected Persons are familiar with our
safety and quality standard and will be able to satisfy our demand efficiently and reliably with
minimal disruption to our Group’s operations and internal procedures.
We believe that we have readily available access to identical or similar suppliers for the
production of HX301 APIs and stability testing services for HX301 APIs from Independent
Third Parties on similar terms in the PRC, but that such procurement from Independent Third
Parties would not be as efficient from a cost perspective or operation perspective as compared
with our current procurement arrangements with the Waterstone Connected Persons.
Pricing policies
In order to ensure that the terms of transactions in respect of the procurement of
HX301 APIs and stability testing services of HX301 APIs by our Group from the Waterstone
Connected Persons are fair and reasonable and in line with market practices, and that the terms
of transactions will be no less favorable to our Group than the terms of transactions between
our Group and Independent Third Parties, our Group has adopted the following measures:
(a) to have regular contact with the suppliers of our Group (including the Waterstone
Connected Persons and Independent Third Parties) to keep abreast of market
developments and the price trend of HX301 APIs and stability testing services for
HX301 APIs; and
(b) to assess, review and compare the quotations or proposals taking into account
various factors including quality, payment, flexibility and after-sales services to
ensure that the proposed transactions will be consistent with the general interest of
our Group and our Shareholders as a whole.
CONNECTED TRANSACTIONS
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--- page 418 ---
Procurement of HX301 APIs and stability testing services for HX301 APIs will be priced
with reference to market prices of comparable products and services. Our Group implements
various internal approval and monitoring procedures, including obtaining quotations on an
as-needed basis from other independent suppliers of similar products and services and consider
various assessment criteria (including location of the suppliers, price, quality, suitability,
payment terms, and time required for the provision and delivery of the products and services)
before entering into any new procurement arrangement with the Waterstone Connected
Persons, and comparing such quotes obtained with the offer from Waterstone Connected
Persons.
Historical amounts
The total contractual sum for the contracts in relation to procurement of HX301 APIs and
the respective stability testing services entered into with Waterstone Connected Persons for
each of the years ended December 31, 2023 and 2024 and the eight months ended August 31,
2025 were as follows:
For the year ended
For the eight
months ended
December 31,
2023
December 31,
2024
August 31,
2025
(RMB) (RMB) (RMB)
Contractual sum for procurement of:
HX301 APIs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118136,500 0 0
Stability testing services /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118000
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118136,500 0 0
We procured HX301 APIs and the respective stability testing service depending on our
demand determined with reference to, including but not limited to, our clinical trial schedule
and progress for the upcoming three years since the commencement of the HX301 trial
experiment in 2020. Therefore, we procured one batch of HX301 APIs (around 4 kg), together
with the stability testing services for the respective batch of HX301 APIs, in end of 2022 for
our usage from 2023 to 2025 (the “ 2022 batch HX301 APIs ”). Considering our demand for
HX301 APIs going forward, we also procured such additional amount (around 1.7 kg) of
HX301 APIs from Waterstone Connected Persons in 2023 for inventory purpose.
CONNECTED TRANSACTIONS
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--- page 419 ---
Annual caps
The contractual sum for the contracts in relation to the procurement of HX301 APIs and
the respective stability testing services to be entered into with Waterstone Connected Persons
for the three years ending December 31, 2025, 2026, and 2027 shall not exceed the proposed
annual caps as set out in the table below:
Proposed annual caps for the year ending
December 31
2025 2026 2027
(RMB) (RMB) (RMB)
Contractual sum for procurement of:
HX301APIs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118950,000 950,000 950,000
Stability testing services /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118250,000 250,000 250,000
Total: /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,200,000 1,200,000 1,200,000
Basis of caps
The above annual caps for procurement amount of HX301 APIs and the respective
stability testing services for the respective batches of HX301 APIs are determined with
reference to (i) the historical transaction amounts in respect of our procurement of HX301 APIs
and the respective stability testing services from Waterstone Connected Persons; (ii) the
anticipated demand for the HX301 APIs from Waterstone Connected Persons from our Group
driven by our clinical trial schedule and progress of development of HX301 APIs. It is expected
that we will procure one batch of HX301 APIs (around 4kg) and the stability testing services
for the respective batch of HX301 APIs for each of the financial year ending December 31,
2025, 2026 and 2027, as more clinical trials are expected to be conducted from 2025 to 2027
before the submission of commercialization application in 2029. It is expected that our
Company will require around 3 batches (which is the minimal number of batches required for
application for commercialization) of HX301 APIs (around 12 kg) and the stability testing
services for the respective batches of HX301 APIs for the financial year ending December 31,
2028 for application purpose. Furthermore, we will still require around one batch (around 4 kg)
of HX301 APIs for the financial year ending December 31, 2029 as it is expected that NMPA
will request our Company to provide one batch of HX301 APIs and the respective stability test
result after application for commercialization for inspection by NMPA; and (iii) a 10% buffer
above the expected procurement amount taking into account the possible increase in
procurement amount due to increase in production costs and any unexpected increase in
demand for HX301 APIs.
CONNECTED TRANSACTIONS
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--- page 420 ---
Based on the confirmation of the industry consultant and information provided by the
Company, the Sponsor is of the view that (i) the continuing connected transaction set out above
has been and will continue to be carried out in the ordinary and usual course of business of the
Company on normal commercial terms or better that are fair and reasonable; (ii) the duration
of the agreement to be a term longer than three years is normal business practice for agreements
of this nature and type.
Raw Materials Supply Framework Agreement (the “Raw Materials Supply Framework
Agreement”)
We entered into a Raw Materials Supply Framework Agreement with Waterstone
Pharmaceuticals on December 10, 2025, pursuant to which Waterstone Connected Persons will
supply to our Group small molecules for the development of our ADC products.
Terms of the Raw Materials Supply Framework Agreement
The initial term of the Raw Materials Supply Framework Agreement shall commence on
the Listing Date until December 31, 2027 and may be renewed conditional on the fulfillment
of the relevant requirements under the relevant laws, regulations and the Listing Rules.
Reasons for the transaction
The Waterstone Connected Persons has been engaging in the biopharmaceutical and small
molecule drugs industry. They process strong research and development capability in the area
of small molecule drugs, and its production factories have passed the GMP audits of the both
foreign and PRC regulatory authorities. Furthermore, during the Track Record Period, we have
been procuring small molecules from the Waterstone Connected Persons. We will continue to
procure small molecules from the Waterstone Connected Persons as they have been providing
us with such products and services with standard and quality commensurate with our requisite
safety and quality standard. As such, we believe Waterstone Connected Persons are familiar
with our safety and quality standard and will be able to satisfy our demand efficiently and
reliably with minimal disruption to our Group’s operations and internal procedures.
We believe that we have readily available access to identical or similar small molecules
from Independent Third Parties on similar terms in the PRC, but that such procurement from
Independent Third Parties would not be as efficient from a cost perspective or operation
perspective as compared with our current procurement arrangements with the Waterstone
Connected Persons.
CONNECTED TRANSACTIONS
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--- page 421 ---
Pricing policies
In order to ensure that the terms of transactions in respect of the procurement of small
molecules by our Group from the Waterstone Connected Persons under the Raw Material
Supply Framework Agreement are fair and reasonable and in line with market practices, and
that the terms of transactions will be no less favorable to our Group than the terms of
transactions between our Group and Independent Third Parties, our Group has adopted the
following measures:
(a) to have regular contact with the suppliers of our Group (including the Waterstone
Connected Persons and the Independent Third Parties) to keep abreast of market
developments and the price trend of small molecules; and
(b) to assess, review and compare the quotations or proposals taking into account
various factors including quality, payment, flexibility and after-sales services to
ensure that the proposed transactions will be consistent with the general interest of
our Group and our Shareholders as a whole.
Procurement of small molecules will be priced with reference to market prices of
comparable products and services. Our Group implements various internal approval and
monitoring procedures, including obtaining quotations on an as-needed basis from other
independent suppliers of similar products and services and consider various assessment criteria
(including location of the suppliers, price, quality, suitability, payment terms, and time required
for the provision and delivery of the products) before entering into any new procurement
arrangement with the Waterstone Connected Persons, and comparing such quotes obtained with
the offer from Waterstone Connected Persons.
Historical amounts
The contractual sum for the small molecules procurement contract entered into with
Waterstone Connected Person for each of the years ended December 31, 2023 and 2024 and the
eight months ended August 31, 2025 were as follows:
For the year ended
For the eight
months ended
December 31,
2023
December 31,
2024
August 31,
2025
(RMB) (RMB) (RMB)
Contractual sum for procurement of small
molecules /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118577,500 39,000 559,000
CONNECTED TRANSACTIONS
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--- page 422 ---
The procurement amount for small molecules depends on our demand with reference to
our ADC products experiment schedule. As confirmed by our Directors, we have commenced
a new ADC product development project in the year ended December 31, 2023. Therefore, the
demand for small molecules increased and we procured two batches of small molecules in the
year ended December 31, 2023 for the research and development of new ADC product. For the
year ended December 31, 2024, we continued with the ADC product development project and
therefore we continued to procured small amount of small molecules.
Annual caps
The contractual sum for the small molecules procurement contracts to be entered into with
Waterstone Connected Persons for the three years ending December 31, 2025, 2026 and 2027
shall not exceed the caps as set out in the table below:
Proposed annual caps for the
year ending December 31,
2025 2026 2027
(RMB) (RMB) (RMB)
Contractual sum for the procurement of
small molecules /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,200,000 600,000 600,000
The above annual caps for procurement amount are determined with reference to: (i) the
historical transaction amounts in respect of small molecules from Waterstone Connected
Persons; (ii) the anticipated demand for small molecules from Waterstone Connected Persons
from our Group driven by the R&D progress of our ADC product candidates, including the
research and development of some new ADC products for the next three years; and (iii) a 10%
buffer above the expected procurement amount taking into account the possible increase in
procurement amount due to increase in production costs inflation and any unexpected increase
in demand for small molecules.
Based on the research schedule of our Group, it is expected that our Group will require
four batches of small molecules for the research and development of two new ADC products
and hence the proposed annual cap for procurement of small molecules increased to RMB1.2
million for the financial year ending December 31, 2025. Furthermore, it is expected that our
Group will require two batches of small molecules for the research and development of one
new ADC product for each of the financial year ending December 31, 2026 and 2027.
Therefore, the proposed annual cap in relation to procurement of small molecules decreased to
RMB600,000.
CONNECTED TRANSACTIONS
–4 1 1–


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LISTING RULES IMPLICATIONS
As our Group is eligible for listing on the Stock Exchange under Chapter 18A of the
Listing Rules and has not recorded any revenue from product sales, the calculation of revenue
ratio under Rule 14.07 of the Listing Rules will produce anomalous result, and thus we
consider it inapplicable. As an alternative, we have applied a percentage ratio test based on the
total expenses for R&D and general and administrative matters of our Group. Furthermore, as
our Company has entered into the HX301 APIs Framework and Stability Testing Service
Agreement and the Raw Material Supply Framework Agreement with the Waterstone
Connected Persons at the same time, they are required to be aggregated as a series of
transactions pursuant to Rule 14A.81 of the Listing Rules.
The aggregated historical transaction amount and the aggregated annual cap in relation to
the HX301 APIs and Stability Testing Services Framework Agreement (collectively, the
“Waterstone CCT Agreements ”) are as follows:
Aggregated historical transaction amounts:
For the year ended
For the eight
months ended
December 31,
2023
December 31,
2024
August 31,
2025
(RMB) (RMB) (RMB)
Contractual sum for procurement amount
under the HX301 APIs and Stability
Testing Services Framework Agreement /H1118136,500 0 0
Contractual sum for procurement amount
under the Raw Materials Supply
Framework Agreement /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118577,500 39,000 559,000
Total: /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118714,000 39,000 559,000
Aggregated proposed annual caps:
Proposed annual caps for the year ending
December 31,
2025 2026 2027
(RMB) (RMB) (RMB)
Proposed annual caps for the HX301 APIs
and Stability Testing Services
Framework Agreement /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,200,000 1,200,000 1,200,000
Proposed annual caps for the Raw
Materials Supply Framework
Agreement /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,200,000 600,000 600,000
Total: /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,400,000 1,800,000 1,800,000
CONNECTED TRANSACTIONS
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--- page 424 ---
As the highest applicable percentage ratio (other than the profit ratio) of the highest annual
caps of the HX301 APIs and Stability Testing Services Framework Agreement and Raw Materials
Supply Framework Agreement, standalone and in aggregate, calculated for the purpose of
Chapter 14A of the Listing Rules is expected to be less than 5% and highest annual cap is less
than HK$3,000,000 on an annual basis. Accordingly, HX301 APIs Framework Agreement and the
Waterstone CCT Agreements will, upon Listing, constitute continuing connected transactions of
the Company fully-exempt from the reporting, announcement, annual review and independent
Shareholders’ approval requirements under Chapter 14A of the Listing Rules.
INTERNAL CONTROL MEASURES
In order to ensure that the terms under the Waterstone CCT Agreements are fair and
reasonable, or no less favorable than terms available to or from Independent Third Parties, and
are carried out under normal commercial terms, we have adopted the following internal control
procedures:
 we have adopted and implemented a management system on connected transactions.
Under such system, the Audit Committee under the Board is responsible for conducting
reviews on compliance with relevant laws, regulations, our Company’s policies and the
Listing Rules in respect of the continuing connected transactions. In addition, the Audit
Committee under the Board, the Board and various other internal departments of the
Company (including but not limited to the finance department and compliance and legal
department) are jointly responsible for evaluating the terms under the Waterstone CCT
Agreements, in particular, the fairness of the pricing policies and annual caps thereunder;
 the Audit Committee under the Board, the Board and various other internal departments
of our Company also regularly monitor the fulfillment status and the transaction updates
under the framework agreements. In addition, the management of our Company also
regularly reviews the pricing policies of the framework agreements;
 our independent non-executive Directors and auditors will conduct annual review of the
continuing connected transactions under the Waterstone CCT Agreements and provide
annual confirmation to ensure that in accordance with Rules 14A.55 and 14A.56 of the
Listing Rules that the transactions are conducted in accordance with the terms of the
agreement, on normal commercial terms and in accordance with the relevant pricing
policies;
 when considering the procurement amount of HX301 APIs, small molecules and stability
testing services fees for HX301 APIs, our Group will constantly research into prevailing
market conditions and practices and make reference to the pricing and terms between the
Group and Independent Third Parties for similar transactions, to make sure that the
pricing and terms offered by the above connected persons from mutual commercial
negotiations (as the case may be), are fair, reasonable and are no less favorable than those
offered to Independent Third Parties; and
CONNECTED TRANSACTIONS
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--- page 425 ---
 when considering any renewal or revisions to the Waterstone CCT Agreements after
Listing, the interested Directors and Shareholders shall abstain from voting on the
resolutions to approve such transactions at board meetings or shareholders’ meetings (as
the case may be), and our independent Directors and Shareholders have the right to
consider if the terms of the non-exempt continuing connected transactions (including the
proposed annual caps) are fair and reasonable, and on normal commercial terms and in the
interests of our Company and our Shareholders as a whole. If the independent Directors’
or independent Shareholders’ approvals cannot be obtained, we will not continue the
transactions under the framework agreement(s) to the extent that they constitute
non-exempt continuing connected transactions under Rule 14A.35 of the Listing Rules.
CONFIRMATION BY DIRECTORS
Our Directors (including independent non-executive Directors) are of the view that the
non-exempt continuing connected transaction has been and will continue to be carried out in our
ordinary and usual course of business of our Company and on normal commercial terms that are
fair and reasonable and in the interests of the Company and our Shareholders as a whole; and that
the proposed annual caps for the non-exempt continuing connected transaction are fair and
reasonable and in the interests of the Company and our Shareholders as a whole. Furthermore,
our Directors are also of the view that the nature of HX301 APIs and Stability Testing Services
Framework Agreement requires a longer period commencing from the date of the agreement and
continue to be in force until December 31, 2029. For further details, please refer to the paragraph
headed “Fully-exempt Continuing Connected Transaction — HX 301 Active Pharmaceutical
Ingredients (“HX301 APIs”) Supply and Testing Services Framework Agreement (the “HX301
APIs and Stability Testing Services Framework Agreement”)” in this section above.
CONFIRMATION BY THE SOLE SPONSOR
The Sole Sponsor has (i) reviewed the relevant documents and information provided by
our Group, (ii) obtained necessary representations and confirmation from our Company and our
Directors and (iii) participated in the due diligence and discussion with the management of our
Company. Based on the above, the Sole Sponsor is of the view that the non-exempt continuing
connected transaction has been and will continue to be carried out in the ordinary and usual
course of business of our Company and on normal commercial terms that are fair and
reasonable and in the interests of the Company and our Shareholders as a whole; and that the
proposed annual caps of the non-exempt continuing connected transaction are fair and
reasonable and in the interests of the Company and our Shareholders as a whole.
Furthermore, considering (i) the reasons for and benefits of entering into the HX301 APIs
and Stability Testing Services Framework Agreement as set out above, (b) the confirmation
from Frost & Sullivan on the terms of the HX301 APIs Framework Agreement, which exceeds
three years, is in line with the industry prevailing practice, and (c) the fact that the relevant
arrangements were negotiated on an arm’s length basis and in accordance with the corporate
governance measures of the Company as set forth above, it is reasonable for the HX301 APIs
and Stability Testing Services Framework Agreement to be entered into for a term as set out
above, and it is normal business practice for agreements of this type to be of such duration.
CONNECTED TRANSACTIONS
– 414 –


--- page 426 ---
OVERVIEW
Our Board consists of 9 Directors, comprising 3 executive Directors, 2 non-executive
Directors and 4 independent non-executive Directors. Pursuant to the Articles of Association,
our Directors are elected and appointed by our Shareholders at a Shareholders’ meeting for a
term of three years, which is renewable upon re-election and re-appointment.
The following tables set forth certain information with respect to our Directors,
Supervisors and senior management as of the Latest Practicable Date:
Members of our Board
Name Age
Present position
in our Group
Date of
appointment
as a Director
Date of joining
our Group
Main roles and
responsibilities in our
Group
Relationships with
other Directors or
senior management
Dr. Zhang Faming
(׼)H1118/H1118/H1118/H1118/H1118
60 Chairman and
executive
Director
March 1, 2024 March 30, 2017 Responsible for the overall
strategic planning,
business and science
development of our
Group
N/A
Dr. Henry
Qixiang Li
(ҽՉജ) /H1118/H1118/H1118/H1118/H1118
64 Chief executive
officer, chief
scientific
officer, general
manager, and
executive
Director
March 1, 2024 January 1, 2022 Responsible for the overall
strategic planning,
development of new
medicine and daily
operation management
of our Group
N/A
Mr. Liu Min
(ᄎઽ) /H1118/H1118/H1118/H1118/H1118/H1118
61 Chief operating
officer, vice
general
manager, and
executive
Director
December 11,
2022
July 1, 2020 Responsible for operation
management and
department coordination
of our Group
N/A
Dr. Li Jian ( ҽ਄) /H111866 Non-executive
Director
March 4, 2024 April 9, 2024 Responsible for providing
guidance on investment
strategies and
governance to our Group
N/A
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
– 415 –


--- page 427 ---
Name Age
Present position
in our Group
Date of
appointment
as a Director
Date of joining
our Group
Main roles and
responsibilities in our
Group
Relationships with
other Directors or
senior management
Ms. Xiao Jieyu
(ӽẘѹ) /H1118/H1118/H1118/H1118/H1118
41 Non-executive
Director
March 1, 2024 March 1, 2024 Responsible for providing
guidance on investment
strategies and
governance to our Group
N/A
Dr. Bi Honggang
(፻) /H1118/H1118/H1118/H1118/H1118
66 Independent
non-executive
Director
October 8, 2024* October 8, 2024* Responsible for
supervising and
providing independent
advice to our Board
N/A
Mr. Chen Qifeng
(ࢤ)H1118/H1118/H1118/H1118/H1118
44 Independent
non-executive
Director
October 8, 2024* October 8, 2024* Responsible for
supervising and
providing independent
advice to our Board
N/A
Mr. Wong Sai
Hung ( ˮ˰ඪ) /H1118
50 Independent
non-executive
Director
October 8, 2024* October 8, 2024* Responsible for
supervising and
providing independent
advice to our Board
N/A
Dr. Zhang
Qiongguang
(ੵᖘΈ) /H1118/H1118/H1118/H1118/H1118
49 Independent
non-executive
Director
October 8, 2024* October 8, 2024* Responsible for
supervising and
providing independent
advice to our Board
N/A
Note:
* The appointment as the independent non-executive Directors will be effective on the Listing Date.
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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--- page 428 ---
Members of our Supervisors
Name Age Title
Date of
appointment
as a Supervisor
Date of joining
our Group
Main roles and
responsibilities
Relationships with
other Directors or
senior management
Dr. Ke Hang
(ঘ) /H1118/H1118/H1118/H1118/H1118/H1118
36 Supervisor, and
Chairman of
Supervisory
Committee
December 13,
2022
April 24, 2017 Supervising our Board
and management
N/A
Ms. Sun Peng
(ᘄ) /H1118/H1118/H1118/H1118/H1118/H1118
49 Supervisor October 8, 2024 June 26, 2023 Supervising our Board
and management
N/A
Ms. Chen Chen
(௓ો) /H1118/H1118/H1118/H1118/H1118/H1118
28 employee
representative
Supervisor
October 8, 2024 September 10,
2020
Supervising our Board
and management
N/A
Members of our senior management
Name Age Title
Date of
appointment
as a senior
management
Date of joining
our Group
Main roles and
responsibilities
Relationships with
other Directors or
senior management
Ms. Zhang Lei
(ੵᆾ) /H1118/H1118/H1118/H1118/H1118/H1118
61 Chief medical
officer, and
vice general
manager
January 1, 2022 January 1, 2022 Management of clinical
research and
development and
participating in
formulation of the
strategic layout of our
Group
N/A
Mr. Zhang Hui
(ੵሾ) /H1118/H1118/H1118/H1118/H1118/H1118
56 Chief financial
officer, joint
company
secretary of
our Company,
the secretary of
our Board, and
vice general
manager
August 1, 2024 August 1, 2024 Supervising the financial
operations of our Group,
and responsible for the
corporate governance,
investor relations
management and
company secretarial
matters of our Group
N/A
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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--- page 429 ---
Name Age Title
Date of
appointment
as a senior
management
Date of joining
our Group
Main roles and
responsibilities
Relationships with
other Directors or
senior management
Dr. Weimin Tang
(ਃઽ) /H1118/H1118/H1118/H1118
60 Chief business
officer
September 2025 September 2025 formulating and advancing
corporate strategies and
driving global growth
through cross-border
transactions of our
Group
N/A
DIRECTORS
The following sets forth the biographies of our Directors:
Executive Directors
Dr. Zhang Faming (׼)aged 60, is our Chairman and an executive Director. He first
jointed our Group in 2017. He was first appointed as a Director and the Chairman on March
1, 2024. He was redesignated as an executive Director on August 22, 2024. Dr. Zhang is
responsible for the overall strategic planning, business and science development of our Group.
Besides, he has been appointed as a director of Hangzhou Hanx since March 30, 2017 and the
director of HanxAimtech since August 23, 2023.
Dr. Zhang has over 30 years of extensive research and development experience in the
pharmaceutical and biotechnology industry. Before establishing our Group, Dr. Zhang began
his career in the US. From March 1990 to March 1992, Dr. Zhang worked as a postdoctoral
fellow, and from March 1992 to September 1994, Dr. Zhang was redesignated as a research
fellow at the University of Texas Southwestern Medical Center. During this period, Dr. Zhang
was responsible for conducting research in biochemistry related to insulin signal transduction.
From September 1994 to May 2005, Dr. Zhang worked as a senior scientist in protein
optimization station group and latter was promoted to a manager at global statistics and
information sciences department at Eli Lilly & Company, where he was responsible for drug
development. From May 2005 to June 2007, Dr. Zhang worked as an associate professor at
Indiana University, where he was responsible for delivering lectures and conducting research
in cancer and diabetes filed. From June 2007 to September 2009, Dr. Zhang worked as a
co-founder and president of Crown Bioscience (Beijing) Co., Ltd.* (Ҧஔ(̏ԯ)
ʮ̡), a subsidiary of Crown Bioscience Inc., where he was responsible for leading drug
development team. As confirmed by our Board, Dr. Zhang does not have any interest in Crown
Bioscience Inc. during the Track Record Period and as of the Latest Practicable Date. In
December 2009, Dr. Zhang established Waterstone Pharmaceuticals, where he served as the
chairman of the board of directors since then and the general manager since December 2020,
responsible for general operation. For further details of Waterstone Pharmaceuticals, please
refer to the paragraph headed “Relationship with our Controlling Shareholders — Our
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
– 418 –


--- page 430 ---
Relationship with Waterstone Pharmaceuticals” in this prospectus. From October 2011 to
September 2014, Dr. Zhang worked as an adjunct professor at the School of Pharmaceutical
Sciences of Wuhan University (ဏɽኪᖹኪ৫), where he was responsible for teaching,
delivering lectures, and supervising students’ internship or experiments. In November 2017,
Dr. Zhang through CZ Biotechnology acquired our Company and has lead the overall strategic
planning, business and science development of our Company since then.
Dr. Zhang graduated from Wuhan University with a bachelor’s degree in physical
chemistry in July 1984 and a master’s degree in polymer chemistry in August 1987. He further
obtained a doctoral degree in biochemistry from the Institute of Biophysics, Chinese Academy
of Sciences (הin July 1990 and a master of business administration
degree from Indiana University Kelley School of Business in August 2003.
As an experience scientist, Dr. Zhang has been recognized as a holder of the following
honorary titles:
Time of Grant Certificates Issuing Authority
March 2013 /H1118/H1118/H1118/H1118/H11182012 Wuhan Top Ten Entrepreneurs*
(2012ي)
Wuhan People’s Government*
(ִ݁)
August 2012 /H1118/H1118/H1118/H1118/H11182011 Top Ten Science and Technology
Entrepreneurial Talents of Hubei*
(2011Ҧ௴ุɛʑ)
Hubei Provincial Department of
Science and Technology*
(ኪҦஔᝂ)
June 2011 /H1118/H1118/H1118/H1118/H1118/H1118Certificate of Project 3551 Talent
Plan* (3551ࣣ)
Wuhan East Lake New Technology
Development Area Administrative
Committee*
(ಳอҦஔක೯ਜ၍։ึ)
Dr. Henry Qixiang Li ( ҽՉജ), aged 64, is our chief executive officer, chief scientific
officer, general manager, and executive Director. He joined our Group as chief executive
officer and chief scientific officer in January 2022. He was appointed as a Director on March
1, 2024 and was redesignated as an executive Director on August 22, 2024. He is responsible
for the overall strategic planning, development of new medicine and daily operation
management of our Group.
Dr. Li has approximately 20 years of extensive medical research and development
experience in the US. Prior to joining our Group, Dr. Li worked as a postdoctoral scholar at
the University of California, Los Angeles from February 1991 to June 1996 with a research
focus on medicine-hematology-oncology. From February 2010 to April 2011, he worked as the
director of research and development of Kylin Therapeutics, Inc., and was responsible for drug
discovery. From April 2011 to December 2021, he worked as the chief scientific officer in
Crown Bioscience Inc., where he was responsible for leading cancer-related research and
development.
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
– 419 –


--- page 431 ---
Dr. Li graduated from the University of Science and Technology of China with a
bachelor’s degree in biology in early 1982. He further obtained a master’s degree in basic
medical sciences from Shanghai Medical College of Fudan University ( ూ͇ɽኪɪऎᔼኪ৫)
(formerly known as Shanghai Medical University (ɽኪ)), in August 1985, and a
doctoral degree in molecular biology and biochemistry from University of California, Irvine in
March 1991.
Mr. Liu Min ( ᄎઽ), aged 61, is our chief operating officer, vice general manager, and
executive Director. He joined our Group as the general manager of Hangzhou Hanx in July
2020. He was appointed as a Director on December 11, 2022 and was redesignated as an
executive Director on August 22, 2024. Besides, he has been appointed as a director of
Hangzhou Hanx since November 19, 2020, the general manager and the executive director of
Wuhan Hanxiong since April 21, 2021 and the manager and executive director of Beijing Hanx
since November 23, 2023. He is responsible for the operation management and department
coordination of our Group.
Prior to joining our Group, he worked as commercial representative of Zhengzhou Branch
of C-BONS Industrial (Wuhan) Co. Ltd.* (࢝(ဏ)ʮ̡) and was responsible
for the establishment of market network and sales from June 1998 to May 2000. From
November 2004 to November 2009, he worked as the manager of the Shanghai Branch of
Hubei C-BONS Co., Ltd.* (ʮ̡) and was responsible for the establishment
of market network and sales. From July 2012 to June 2020, he worked as the deputy general
manager of Waterstone Pharmaceuticals, and was responsible for the operation management of
the company.
Mr. Liu graduated from Hubei Open University (ɽኪ), formerly known as
Hubei Radio and Television University* ( ಳ̏ᄿᅧཥൖɽኪ), specializing in business
enterprise management in July 1989. He further obtained a certificate of completion on EMBA
President Seminar on Business Administration* (EMBAफ) from Huazhong
University of Science and Technology (Ҧɽኪ) in December 2010.
Non-executive Directors
Dr. Li Jian ( ҽ਄), aged 66, is our non-executive Director. He joined our Group and was
appointed as a Director on March 4, 2024 and was redesignated as a non-executive Director on
August 22, 2024. He is responsible for providing guidance on investment strategies and
governance to our Group.
Dr. Li Jian has around over 16 years of extensive medical research and development
experience in the US and China. Dr. Li Jian began his career in the US. From June 2008 to
November 2011, Dr. Li Jian worked as a partner in Nanotarget Limited Liability Company, and
was responsible for company operation. From February 2009 to October 2011, Dr. Li Jian
worked as a portfolio advisor at database and licensing department of HUY A Bioscience
International LLC, and was responsible for licensing. Subsequently, Dr. Li Jian started working
in China. From November 2011 to April 2017, Dr. Li Jian worked as a scouting & partnering
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
– 420 –


--- page 432 ---
director at Sanofi (China) Investment Co., Ltd. Shanghai Branch* ( ᒄፕി(ʕ਷)ʮ̡
ɪऎʱʮ̡), and was responsible for strategy and business development. From May 2017 to
October 2020, Dr. Li Jian worked as a vice president for business development and a consultant
in Chengdu HitGen Drug Development Co. Ltd.* (ʮ̡), a
company listed on the Shanghai Stock Exchange (stock code: 688222), and was responsible for
business development. From February 2021 to Present, Dr. Li Jian worked as partner at Beijing
Lapam Investment Management Consulting Center (General Partnership)* ( ̏ԯᎲᇂҳ༟၍ଣ
ፔ༔ʕː(౷ஷΥྫ)), and was responsible for biotech investment.
Dr. Li Jian graduated from the Shandong University (ɽኪ) with a bachelor’s degree
in microbiology in July 1982. He further obtained a master’s degree in agromicrobiology from
China Agricultural University ( ʕ਷ุ༵ɽኪ) (formerly known as Beijing Agricultural
University* ( ̏ԯุ༵ɽኪ)) in October 1985, and a doctoral degree in natural sciences from
University of Cologne in February 1990.
Ms. Xiao Jieyu ( ӽẘѹ), aged 41, is our non-executive Director. She joined our Group
and was appointed as a Director on March 1, 2024 and was redesignated as a non-executive
Director on August 22, 2024. She is responsible for providing guidance on investment
strategies and governance to our Group.
Ms. Xiao has extensive experience in corporate finance industry. Prior to joining our
Group, she worked as a senior investment manager at Wuhan Optics V alley V enture Capital
Private Equity Fund Management Co., Ltd.* (ʮ̡) from June
2012 to June 2015 and was responsible for investment and corporate finance works. From
February 2016 to October 2016, she worked as a deputy manager at Hubei Branch of Huayuan
Securities Co., Ltd.* (ʮ̡) (formerly known as Jiuzhou Securities Co.,
Ltd.* (ʮ̡)) and was responsible for investment banking, investment and
financing works. From November 2016 to October 2019, she worked as an investment director
at Hubei Changjiang Hezhi Equity Investment Fund Management Co., Ltd.* (ϪΥқ
ʮ̡) and was responsible for investment banking and corporate
finance works. From May 2021 to August 2025, she worked as a deputy general manager of
Wuhan East Lake High Tech Investment Management Co., Ltd.* (ᛆҳ༟၍ଣ
ʮ̡) and was responsible for investment and financing related matters. From July 2021
to July 2022, she worked as a director of Pugao Medical Technology (Nanjing) Co., Ltd.* ( ᗅ
Ҧ(ԯ)ʮ̡) and was responsible for providing guidance on investment
strategies and corporate governance. Furthermore, she has also been appointed as a director of
Wuhan Bintong Biotechnology Co., Ltd.* (ʮ̡) and is responsible for
providing guidance on investment strategies and corporate governance since June 2021, a
director of Chengdu Jinweike Biotechnology Co., Ltd.* (ʮ̡) and is
responsible for providing guidance on investment strategies and corporate governance since
January 2022 and Wuhan Bank-Biotechnology Co., Ltd.* (ʮ̡) and is
responsible for providing guidance on investment strategies and corporate governance since
August 2022, respectively.
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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--- page 433 ---
Ms. Xiao graduated from the Huazhong Agricultural University* ( ശʕุ༵ɽኪ) with a
bachelor’s degree in plant protection in June 2005. She further obtained a master’s degree in
pharmacology from Shanghai Institute of Pharmaceutical Industry* (Ӻ৫)i n
June 2008. She also received the Certification of Fund Practice Qualification* (ุ੽ุᗇ
ࣣfrom the Asset Management Association of China (ุ՘ึ) in June 2017.
Independent non-executive Directors
Dr. Bi Honggang (፻), aged 66, was appointed as our independent non-executive
Director on October 8, 2024 with effect from the Listing Date. He is responsible for
supervising and providing independent advice to our Board.
Dr. Bi has over 39 years of extensive medical research and development experience in
Canada, the US and China. From 1984 to August 2005, Dr. Bi has worked in different research
institute and pharmaceutical companies, including Institute of Material Medical of Chinese
Academy of Medical Sciences, SmithKline Beecham P .L.C. (currently known as
GlaxoSmithKline P .L.C.) and Pfizer Global Research and Development, and was responsible
for conducting and leading various medical researches. From August 2005 to August 2007, Dr.
Bi worked as the chief executive officer in Frontage Laboratories, Inc. During this period, he
was responsible for general operation. From August 2007 to April 2020, Dr. Bi worked as a
corporate vice president at Covance Inc., and was responsible for general operation. From May
2020 to November 2023, Dr. Bi worked as senior vice president and head of Asia-Pacific, at
Labcorp Pharmaceutical Research and Development (Shanghai) Co., Ltd.* (೯
(ɪऎ)ʮ̡), and was responsible for general operation.
Dr. Bi graduated from the College of Pharmacy of Zhejiang University ( एϪɽኪ),
formerly known as Zhejiang Medical University* (ɽኪ), with a bachelor’s degree in
medicine in April 1982. He then obtained the doctor of philosophy degree from McGill
University in June 1992.
Mr. Chen Qifeng (ࢤ)aged 44, was appointed as our independent non-executive
Director on October 8, 2024 with effect from the Listing Date. He is responsible for
supervising and providing independent advice to our Board.
Mr. Chen has over 16 years of experience in accounting. From October 2004 to October
2009, Mr. Chen worked as senior associate at Ernst & Y oung Hua Ming LLP , Wuhan Branch
and was responsible for audit work. From January 2011 to November 2013, Mr. Chen worked
as an audit manager at Deloitte Touche Tohmatsu Certified Public Accountants LLP , and was
responsible for audit works. From February 2014 to August 2019, Mr. Chen worked as a
finance controller at General Electric High V oltage Equipment (Wuhan) Co. Ltd.* ( ஷ͜ཥं
ʮ̡) (formerly known as Shanghai Electric Alstom (Wuhan) Transformers
Co., Ltd.* (ဧ౶ஷ(ဏ)ʮ̡) and Alstom High V oltage Electric
Equipment (Wuhan) Co., Ltd.* (ဧ౶ஷ৷Ꮐཥंண௪(ဏ)ʮ̡)), and was responsible
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
– 422 –


--- page 434 ---
for financial management. From August 2019 to April 2022, Mr. Chen worked as financial
director at Meihao Property Group Co. Ltd.* (ʮ̡), a company listed
on the Shenzhen Stock Exchange (stock code: 000667), and was responsible for financial
management.
Mr. Chen graduated from the Zhongnan University of Economics and Law (݁
ɽኪ) with a bachelor’s degree in accounting in June 2001 through on-line learning, and a
master’s degree in Accounting in December 2013. Besides, Mr. Chen is a Certified
Management Accountant since November 2018, and has become a non-practicing member of
the Chinese Institute of Certified Public Accountant since September 2021. Mr. Chen has also
held the title of Senior Accountant* (ࢪࠇsince November 2023.
Mr. Wong Sai Hung ( ˮ˰ඪ), aged 50, was appointed as our independent non-executive
Director on October 8, 2024 with effect from the Listing Date. He is responsible for
supervising and providing independent advice to our Board.
From March 2001 to December 2007, Mr. Wong worked as an audit manager at Moore
Stephens CPA Limited, and was responsible for audit works. From November 2009 to April
2010, Mr. Wong worked as a trainee solicitor at Vivien Chan & Co, and was responsible for
handling trademark and patent related cases. From January 2011 to November 2013, Mr. Wong
worked at Jun He Law Offices, with his last position as assistant solicitor and was responsible
for handling initial public offering projects in Hong Kong. From November 2013 to March
2019, Mr. Wong worked as a managing associate in Addleshaw Goddard (Hong Kong) LLP , and
was responsible for handling initial public offering projects in Hong Kong. From March 2019
to September 2021, Mr. Wong worked as a senior associate at Norton Rose Fulbright (Services)
Limited, and was responsible for handling initial public offering projects in Hong Kong. From
October 2021 to October 2024, Mr. Wong worked as a partner at CFN Lawyers, and was
responsible for handling initial public offering projects in the US.
Mr. Wong graduated from the University of Toronto with a bachelor’s degree in
commerce in November 1998. He further obtained a bachelor’s degree in laws from City
University of Hong Kong in July 2006. He then obtained the Postgraduate Certificate in Laws
from The University of Hong Kong in June 2008. Mr. Wong has been a financial risk manager
of the Global Association of Risk Professionals since December 2002, and a certified public
accountant of the Hong Kong Institute of Certified Public Accountants since July 2005. He has
been a holder of the Chartered Financial Analyst (CFA) qualification and a member of CFA
Institute since October 2003. Mr. Wong was also admitted as a solicitor of the High Court of
Hong Kong in 2010.
Dr. Zhang Qiongguang ( ੵᖘΈ), aged 49, was appointed as our independent non-
executive Director on October 8, 2024 with effect from the Listing Date. He is responsible for
He is responsible for supervising and providing independent advice to our Board.
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
– 423 –


--- page 435 ---
From July 1996 to December 2011, Dr. Zhang Qiongguang has worked in various
pharmaceutical-related job positions, including supervisor of the Hubei Province Xiaochang
County First People’s Hospital* (߅developer and project
manager of various subsidiaries of Jianmin Pharmaceutical Group Co. Ltd. (ٰ
ʮ̡), a company listed on the Shanghai Stock Exchange (stock code: 600976)
responsible for new drug discovery, and deputy general manager of quality in Wuhan Jianheng
Pharmaceutical Co. Ltd.* (ʮ̡) responsible for conducting research and
development activities on traditional Chinese medicine targeting diabetes and other diseases
and drafting relevant materials for patent applications. From May 2013 to June 2017, Dr. Zhang
Qiongguang worked as a reviewer and inspector at Hubei Food and Drug Administration
Technical Assessment and V erification Center* (ʕ
ː). From June 2017 to September 2022, Dr. Zhang Qiongguang worked as an inspector at
Center for Food and Drug Inspection of National Medical Products Administration (ۜ
᜕ʕː). From September 2022 to December 2023, Dr. Zhang
Qiongguang worked as a senior vice president in Beijing ABZYMO Biosciences Co., Ltd.* ( ̏
ʮ̡), a subsidiary of Jiangsu Recbio Technology Co., Ltd. (߅
ʮ̡), a company listed on the Main Board of the Stock Exchange (stock
code: 2179). Besides, Dr. Zhang Qiongguang has been: (i) a part-time professor of College of
Life Science and Health of Wuhan University of Science and Technology* (Ҧɽኪ͛ն
ኪၾ਄ੰኪ৫) since October 2022 and (ii) a consultant of Beijing ABZYMO Biosciences
Co., Ltd.* (ʮ̡), a subsidiary of Jiangsu Recbio Technology Co.,
Ltd., since January 2024.
Dr. Zhang Qiongguang graduated from the Hubei University of Chinese Medicine ( ಳ̏
ʕᔼᖹɽኪ), formerly known as Hubei Chinese Medicine College* ( ಳ̏ʕᔼኪ৫), with a
junior college diploma in Chinese Medicine in June 1996. He further obtained a master’s
degree in Chinese Medicine Pharmacology from the Hubei University of Chinese Medicine in
June 2003. He then obtained a doctoral degree in pathogen biology from the Wuhan University
(ဏɽኪ) in June 2015. Dr. Zhang Qiongguang has become a Senior Engineer* (ࢪ)
since October 2011.
Disclosure requirement under the Listing Rules and confirmations from our Directors
Save as disclosed in this section, each of our Directors confirms with respect to
himself/herself that:
(i) he/she has not held any directorship in the three years prior to the Latest Practicable
Date in public companies, the securities of which are listed on any securities market
in Hong Kong or overseas;
(ii) he/she does not hold other positions in our Company or other members of our
Group;
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(iii) he/she is independent from and he/she does not have any relationship with other
Directors, senior management, substantial shareholders or Controlling Shareholders
of our Company, save as disclosed in the paragraph headed “Relationship with our
Controlling Shareholders — Our Controlling Shareholders” in this prospectus;
(iv) save as disclosed in the paragraphs headed “Substantial Shareholders” and “C.
Further Information about our Directors, Supervisors and Substantial Shareholders
— 1. Disclosure of Interests” in Appendix VI to this prospectus, he/she does not
have any interest in our Shares within the meaning of Part XV of the SFO;
(v) he/she does not have any interest in any business which competes or may compete,
directly or indirectly, with us, which is discloseable under the Listing Rules;
(vi) save as Dr. Zhang is a director of CZ Biotechnology, being our Controlling
Shareholders, he/she is not a director or employee of a company which has an
interest or short position in the shares and underlying shares of the issuer which
would fall to be disclosed to the issuer under the provisions of Divisions 2 and 3 of
Part XV of the SFO;
(vii) to the best of the knowledge, information and belief of our Directors having made
all reasonable enquiries, there was no additional information relating to our
Directors that is required to be disclosed pursuant to Rule 13.51(2) of the Listing
Rules and no other matter with respect to their appointments that needs to be brought
to the attention of our Shareholders as of the Latest Practicable Date;
(viii) he/she, or his/her respective close associates, did not engage in or have any interest
in a business, apart from business of our Group, which competes or is likely to
compete with our business, whether directly or indirectly, or would otherwise
require disclosure under Rule 8.10 of the Listing Rules; and
(ix) he or she (i) has obtained the legal advice referred to under Rule 3.09D of the Listing
Rules in August 2024, and (ii) understands his or her obligations as a director of a
listed issuer under the Listing Rules.
Furthermore, each of the independent non-executive Directors has confirmed (i) his
independence as regards each of the factors referred to in rules 3.13(1) to (8) of the Listing
Rules; (ii) he has no past or present financial or other interest in the business of our Company
or its subsidiaries or any connection with any core connected person (as defined in the Listing
Rules) of our Company; and (iii) that there are no other factors that may affect his
independence at the time of his appointment.
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SUPERVISORY COMMITTEE
Our Supervisory Committee consists of three members, including two Supervisors
appointed by shareholders’ meetings and one employee representative Supervisor, elected at
employee representative meetings. Our Supervisory Committee is responsible for supervising
the performance of duty of our Board and the senior management of our Company and
overseeing the financial, internal control and risk conditions of our Company. The Supervisors
serve a term of three years and may be re-elected for successive reappointments. As of the
Latest Practicable Date, our Supervisory Committee is composed of Dr. Ke, Ms. Sun and Ms.
Chen. Dr. Ke is the chairman of our Supervisory Committee.
Dr. Ke Hang (ঘ), aged 36, is our Supervisor. He was appointed as a Supervisor on
December 11, 2022, and redesignated as the Chairman of Supervisory Committee since
October 8, 2024. Besides, he has also been appointed as the supervisor of Hangzhou Hanx from
November 19, 2020 to March 31, 2025. He was also appointed as the manager and legal
representative of Hangzhou Hanx on April 11, 2025. He is responsible for supervising our
Board and management.
Dr. Ke first joined our Group in April 2017 and worked at Hangzhou Hanx since then,
being responsible for protein purification techniques and related works. Since April 2024, he
has been appointed as the senior director of research and development department of Hangzhou
Hanx and is responsible for preclinical research and development and project management.
Dr. Ke graduated from the Wuhan University with a bachelor’s degree in life sciences and
technology in June 2010. He further obtained a doctoral degree in plant biology from
Aix-Marseille University in February 2017. He was recognized as a high-level talent in
Hangzhou City Zhejiang Province* (ψ̹৷ᄴϣɛʑ) by Hangzhou Human
Resources and Social Security Bureau* (ღ҅) in June 2022. Also,
Dr. Ke is listed in the 11th batch of 3551 Optics V alley Talent Schema* (3551ྌ)
by Wuhan East Lake New Technology Development Area Administrative Committee* (؇
ึ) in December 2018.
Ms. Sun Peng (ᘄ), aged 49, is our Supervisor. She was appointed as a Supervisor on
October 8, 2024. She is responsible for supervising our Board and management.
Ms. Sun joined our Group in June 2023 and worked as a vice president of clinical
development of our Company since then, and is responsible for managing the clinical
development team in China. Prior to joining our Group, Ms. Sun has over 15 years of
experience in medical research and development. From August 2008 to May 2010, Ms. Sun
worked as a medical affairs physician in GlaxoSmithKline (China) Investment Co., Ltd.* ( ໤
ᚆ९̦д(ʕ਷)ʮ̡), a wholly-owned subsidiary of GSK plc, which is a company
listed on the London Stock Exchange (stock code: GSK) and was responsible for clinical
research. From July 2010 to September 2011, Ms. Sun worked as a medical expert in
immunology and infectious diseases in Beijing Novartis Pharmaceuticals Co., Ltd.* ( ̏ԯፕശ
ʮ̡), a wholly-owned subsidiary of Novartis AG, which is a company listed on the
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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Swiss Stock Exchange (stock code: NOVN), and was responsible for clinical research. From
September 2011 to November 2016, Ms. Sun worked as a disease area specialist in clinical
research in Bristol-Myers Squibb (China) Investment Co, Ltd* (൮ᘒ(ʕ਷)ࠢ
ʮ̡), a subsidiary of Bristol Myers Squibb Co., which is a company listed on the New Y ork
Stock Exchange (stock code: BMY), and was responsible for clinical research. From December
2016 to August 2018, Ms. Sun worked as an associate director of clinical research in MSD
R&D (China) Co., Ltd.* (೯(ʕ਷)ʮ̡), an indirect wholly-owned subsidiary of
Merck & Co., Inc., which is a company listed on the New Y ork Stock Exchange (stock code:
MRK), and was responsible for new drug clinical development and research. From September
2018 to March 2020, Ms. Sun worked as a director of clinical sciences in Shanghai Simcere
Pharmaceutical Co., Ltd.* (ʮ̡), an indirect wholly-owned subsidiary of
Simcere Pharmaceutical Group Limited (ʮ̡), which is a company listed
on the Main Board of the Stock Exchange (stock code: 2096), and was responsible for
designing clinical research and development strategies and plans. From March 2020 to June
2021, Ms. Sun worked as a medical director in Eucure (Beijing) Biopharma Co, Ltd.* ( ॖձ
Ҧ(̏ԯ)ʮ̡), a wholly-owned subsidiary of Biocytogen Pharmaceuticals
(Beijing) Co., Ltd.* ( ϵෳᒄྡ(̏ԯ)ʮ̡), which is a company listed on the
Main Board of the Stock Exchange (stock code: 2315) and was responsible for new drug
clinical development and research. From June 2021 to June 2023, Ms. Sun worked as a medical
executive director in Shanghai KeChow Pharma, Inc.* (ʮ̡), and was
responsible for new drug clinical development and research.
Ms. Sun graduated from the Shandong First Medical University (ɽኪ)
(formerly known as Taishan Medical College* ( इʆᔼኪ৫)) with a bachelor’s degree in
clinical medicine in July 1998. She further obtained a master’s degree in pharmacology from
Jinan University (ɽኪ) in June 2003.
Ms. Chen Chen ( ௓ો), aged 28, is our Supervisor. She was appointed as an employee
representative Supervisor on October 8, 2024. Besides, she has also been appointed as the
supervisor of Beijing Hanx since November 23, 2023. She was appointed as the supervisor of
Hangzhou Hanx on March 31, 2025. She is responsible for supervising our Board and
management.
Ms. Chen joined our Group in September 2020. From September 2020 to September 2024,
Ms. Chen worked as an assistant of general manager of Hangzhou Hanx, and she was promoted
to human resource manager in September 2023, during this period she was responsible for our
Hangzhou Hanx’s human resources and administrative work. Since September 2024, Ms. Chen
has been redesignated as the senior human resource manager and assistant of general manager
of the Company, and responsible for the human resources and administrative work of our
Group.
Ms. Chen graduated from Wuhan Sports University (ဏ᜗ԃኪ৫) with a bachelor’s
degree in education majoring in martial arts and national traditional sports on June 30, 2020.
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SENIOR MANAGEMENT
Our members of senior management are responsible for the day-to-day management of
our business and the relevant details are as follows:
Ms. Zhang Lei ( ੵᆾ), aged 61, is the chief medical officer, and vice general manager of
our Group. She first joined our Group as chief medical officer in January 2022. She is
responsible for the management of clinical research and development and participating in
formulation of the strategic layout of our Group.
Ms. Zhang has over 23 years of experience in research and development of new
medicines. Prior to joining our Group, from February 1998 to August 2004, she worked as a
senior clinical development associate in Eli Lilly and Company. From August 2004 to
November 2008, she worked as the oncology associate director clinical research physician of
Novartis Pharmaceuticals Corporation, a subsidiary of Novartis AG, a company duly listed on
both the SWX Swiss Exchange (stock code: NOVN) and the New Y ork Stock Exchange (stock
code: NVS), and was responsible for the clinical development of multiple indications. From
November 2008 to December 2018, she worked as the executive medical director, program lead
clinical research and development at Celgene Corporation, and was responsible for leading
clinical research and new drug discovery. From January 2019 to January 2020, she worked as
the chief medical officer at Denovo Biopharma LLC, and was responsible for the management
of the clinical team and pipeline of the Company.
Ms. Zhang graduated with a bachelor’s degree in medicine from the Capital Medical
University (ɽኪ), formerly known as Capital Medical College* (ேᔼኪ৫)i n
August 1986. She further obtained a master’s degree in biochemistry from the Virginia
Commonwealth University Medical College of Virginia in December 1994.
Mr. Zhang Hui ( ੵሾ), aged 56, is the chief financial officer, joint company secretary of
our Company, the secretary of our Board, and vice general manager. He first joined our Group
as chief financial officer and the secretary of our Board in August 2024. Besides, he was
appointed as a director of Hangzhou Hanx on March 31, 2025. He is responsible for
supervising the financial operations of our Group, and the corporate governance, investor
relations management and company secretarial matters of our Group.
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Mr. Zhang Hui has over 16 years of experience in investment banking and financing. Prior
to joining our Group, he worked at the following institutions:
Period of service Name of company Nature of business Position
October 2003 to
October 2004;
and May 2005
to April 2006 /H1118/H1118/H1118/H1118
DBS Bank Ltd., Beijing
Branch (formerly known as
The Development Bank of
Singapore Ltd., Beijing
Branch)
Financing business Joined as a senior manager,
and last position as the
chief representative of the
DBS Asia Capital Limited
Beijing Representative
Office (ࠢ
ஈ)
August 2006 to
December 2007 /H1118/H1118
BNP Paribas Equities (Asia)
Limited Beijing
Representative Office
Investment and
financing business
Senior vice president
December 2007 to
December 2008 /H1118/H1118
Lehman Brothers Investment
Consulting (Shanghai)
Co., Ltd
Investment and
financing business
Senior vice president
April 2010 to
January 2011 /H1118/H1118/H1118/H1118
Deutsche Bank (China) Co.,
Ltd. Beijing Branch (a
subsidiary of Deutsche
Bank AG, which is listed
on the Frankfurt Stock
Exchange, stock code:
DBK; and the New Y ork
Stock Exchange, stock
code: DB)
Investment and
financing business
China financing,
DCM/CCG/director in
global markets division
February 2011 to
February 2012 /H1118/H1118/H1118
Samsung Securities (Asia)
Limited (a subsidiary of
Samsung Securities Co.,
Ltd., which is listed on the
Korean Stock Exchange,
stock code: 016360)
Investment and
financing business
Managing director and head
of China in the investing
banking and principal
investments department
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Period of service Name of company Nature of business Position
February 2012 to
January 2015; and
September 2016 to
January 2021 /H1118/H1118/H1118/H1118
Guosen Securities (HK)
Capital Company Limited
(a subsidiary of Guosen
Securities Company
Limited, which is listed on
the Shenzhen Stock
Exchange, stock code:
002736)
Investment and
financing business
Managing director, head of
investment banking division
and head of global capital
markets
June 2021 to June
2023 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Beijing Luzhu Biotechnology
Co., Ltd. (listed on the
Stock Exchange, stock
code: 2480)
Biotechnology
company
Chief financial officer, head
of global capital markets
Mr. Zhang Hui graduated with a bachelor’s degree in materials engineering from
Shanghai Jiao Tong University ( ɪऎʹஷɽኪ) in July 1992. He further obtained a master’s
degree in management through long distance learning from the Australian National University
in 2008, and obtained a master’s degree in pharmaceutical engineering through long distance
learning from Wuhan Institute of Technology (ဏʈ೻ɽኪ) in 2024.
Dr. Weimin Tang (ਃઽ), aged 60, is the chief business officer of our Company. He
first joined our Company as chief business officer in September 2025. He is responsible for
formulating and advancing corporate strategies and driving global growth through cross-border
transactions of our Group.
Dr. Tang has over 20 years of leadership experience in the global pharmaceutical and
biotechnology industry. Prior to joining our Group, he worked in senior management positions
at Bristol-Myers Squibb* (൮ᘒ), Aventis Pharmaceutical* (currently known as Sanofi
Pharmaceutical) ( ᒄፕി(ᖹุ)), Johnson & Johnson* (ʮ̡) for a number of years,
and he also worked at Pfizer Investment Co., Ltd.* (ʮ̡) (formerly known as
American Cyanamid Co.). From April 2018 to April 2024, Dr. Tang worked as chief business
officer at I-Mab Biopharma Co., Ltd.* (ʮ̡), a company listed on the
NASDAQ Global Market (stock code: IMAB), where he was responsible for formulating and
executing global business strategies as well as facilitating strategic partnerships with
international pharmaceutical companies and research institutions.
Dr. Tang graduated with a bachelor’s degree in plant pathology from Zhejiang
Agricultural University, which is presently known as Zhejiang University* ( एϪɽኪ) in July
1986. He obtained a master’s degree in microbiology from the Institute of Microbiology,
Chinese Academy of Sciences* (הin February 1990, and later a
doctoral degree in molecular biology from Rutgers University in the United States in 1997.
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JOINT COMPANY SECRETARIES
Mr. Zhang Hui ( ੵሾ), aged 56, joined our Group on August 1, 2024 as the chief
financial officer, and the secretary of our Board. Mr. Zhang Hui was appointed as the joint
company secretary of our Group on October 31, 2024. For further biographic details of
Mr. Zhang Hui, please refer to the paragraphs headed “— Senior Management” in this section
above.
Mr. Li Kin Wai (۾)is a Senior Manager of Corporate Services of Tricor Services
Limited, a global professional services provider specialising in integrated business, corporate
and investor services. Mr. Li was appointed as a joint company secretary of our Company in
June 2025. Mr. Li has over 10 years of experience in the corporate secretarial field.
Mr. Li is a Chartered Secretary, a Chartered Governance Professional and an Associate of
both The Hong Kong Chartered Governance Institute and The Chartered Governance Institute
in the United Kingdom.
BOARD COMMITTEES
Our Board delegates certain responsibilities to various committees. In accordance with
the relevant PRC laws and regulations and the Corporate Governance Code, Appendix C1 to
the Listing Rules, our Company has established three Board committees, namely the audit
committee, the remuneration committee and the nomination committee.
Audit Committee
We have established an Audit Committee with written terms of reference in accordance
with Rule 3.21 of the Listing Rules and the Corporate Governance Code as set out in Appendix
C1 to the Listing Rules. The Audit Committee comprises three Directors, namely Mr. Chen,
Mr. Wong and Ms. Xiao, and is chaired by Mr. Chen. The primary duties of the audit committee
are to assist our Board by providing an independent view of the effectiveness of the financial
reporting process, risk management and internal control systems of our Group, to oversee the
audit process, to develop and review our policies, to make recommendations to our Board on
the appointment and dismissal of the external auditors, and to perform other duties and
responsibilities as assigned by our Board.
Remuneration Committee
We have established a Remuneration Committee with written terms of reference in
compliance with Rule 3.25 of the Listing Rules and the Corporate Governance Code as set out
in Appendix C1 to the Listing Rules. The Remuneration Committee comprises three Directors,
namely Mr. Wong, Dr. Li Jian and Dr. Bi, and is chaired by Mr. Wong. The primary duties of
the remuneration committee are to establish and review the policy and structure of the
remuneration for our Directors, Supervisors and senior management, review and approve our
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management’s remuneration proposals with reference to our Board’s corporate goals and
objectives, ensure none of our Directors determine their own remuneration, and make
recommendations on employee benefit arrangement.
Nomination Committee
We have established a Nomination Committee with written terms of reference in
compliance with the Corporate Governance Code as set out in Appendix C1 to the Listing
Rules. The Nomination Committee comprises five Directors, namely Dr. Zhang, Dr. Bi, Dr.
Zhang Qiongguang, Ms. Xiao Jieyu and Mr. Chen Qifeng and is chaired by Dr. Zhang. The
primary duties of the nomination committee are to review the structure, size and composition
(including the skills, knowledge and experience) of our Board at least annually and make
recommendation to our Board on any proposed changes to our Board to complement our
Company’s corporate strategy; identify individuals suitably qualified as potential board
members and select or make recommendations to our Board on the selection of individuals
nominated for directorships; assess the independence of independent non-executive Directors;
and make recommendations to our Board on the appointment or reappointment of Directors and
succession planning of Directors, in particular that of our Chairman.
BOARD DIVERSITY POLICY
With a view to achieving sustainable and balanced development, we have adopted a board
diversity policy (the “ Board Diversity Policy ”) to achieve diversity in our Board. The Board
Diversity Policy sets out the objective of and approach by our Board to achieve and maintain
diversity in our Board in order to enhance the effectiveness of our Board and recognizes and
embraces the benefits of diversity in our Board. We endeavour to ensure that our Board
members have the appropriate balance of skills, experience and diversity of perspectives that
are required to support the implementation of our business strategy. Pursuant to the Board
Diversity Policy, we seek to achieve Board diversity through the consideration of a number of
factors, including but not limited to gender, age, cultural and educational background,
professional experience, skills, knowledge and length of service and any other factors that our
Board may consider relevant and applicable from time to time. The ultimate decision of the
appointment will be based on merit and the contribution which the selected candidates will
bring to our Board. Our Board believes that such merit-based appointments will enable our
Company to best serve our Shareholders and other stakeholders going forward.
Our Board currently comprises 9 Directors, including 3 executive Directors, 2 non-
executive Directors and 4 independent non-executive Directors. Currently, we have one female
Director and eight male Directors. Our Directors have a balanced mixed of knowledge and
skills, including but not limited to medical industry knowledge, overall business management,
law and accounting. They obtained degrees in various majors including medicine, business
enterprise management, law and accounting, etc. Furthermore, our Board has a relatively wide
range of ages, ranging from 41 years old to 66 years old and consists of eight male members
and one female member. Our Board believes that the female representation in our Board, a mix
of different background and experiences of our Directors and the age diversity, would enable
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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our Directors to bring in valuable views and opinions of different perspectives, which could
enhance the quality of decision making of our Board and benefit our Group as a whole. Based
on the foregoing, we consider our current Board composition satisfies the principles set out in
the Board Diversity Policy.
Our nomination committee will review the composition of our Board and identify and
recommend suitable candidates to our Board from time to time and make recommendations as
to the appointment of members of our Board in accordance with our Board Diversity Policy.
Our Company will also take into consideration factors based on our Group’s business model
and specific needs from time to time in determining the optimum composition of our Board.
CORPORATE GOVERNANCE
We are committed to high standards of corporate governance with a view to safeguarding
the interests of our Shareholders. To accomplish this, we will comply with the corporate
governance requirements under the Corporate Governance Code and Corporate Governance
Report set out in Appendix C1 to the Listing Rules after the Listing.
REMUNERATION POLICY
Our Directors, Supervisors and members of our senior management receive compensation
from our Group in the form of salaries, discretionary bonuses, contributions to pension
schemes and other allowances and benefits in kind subject to applicable laws, rules and
regulations.
Our Board will review and determine the remuneration and compensation packages of our
Directors, Supervisors and senior management which, following the Listing, will receive
recommendation from the remuneration committee which will take into account salaries paid
by comparable companies, time commitment and responsibilities of our Directors and
performance of our Group.
REMUNERATION OF DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
For the financial years ended December 31, 2023 and 2024 and the eight months ended
August 31, 2025, the aggregate amount of directors’ fees, salaries, allowances and benefits in
kind, discretionary bonuses, retirement scheme contributions, and termination benefits of our
Directors, Supervisors, and senior management were RMB1.9 million, RMB18.3 million and
RMB14.4 million, respectively. It is estimated that under the arrangements currently in force,
the aggregate emolument payable to the Directors and Supervisors (excluding discretionary
bonus) for the year ending December 31, 2025, will be RMB26.9 million.
Our Company’s five highest paid individuals includes one, four and three chief executive
and directors for each of the financial years ended December 31, 2023 and 2024 and the eight
months ended August 31, 2025, respectively. The aggregate amount of directors’ fees, salaries,
allowances and benefits in kind, discretionary bonuses, retirement scheme contributions, and
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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termination benefits of five highest individuals (including Directors) for each of the financial
years ended December 31, 2023 and 2024 and the eight months ended August 31, 2025, were
RMB23.6 million, RMB5.6 million and RMB12.1 million, respectively. During the Track
Record Period, no remuneration was paid by our Company to, or receivable by, our Directors,
Supervisors or the five highest paid individuals as an inducement to join or upon joining our
Company or as a compensation for loss of office in connection with the management of the
affairs of our Company or any subsidiary during the Track Record Period.
During the Track Record Period, none of our Directors and Supervisors waived or agreed
to waive any emolument. For details of Directors’ and Supervisors’ remunerations during the
Track Record Period as well as details of the five highest paid individuals, see notes 9 and 10
in the Accountants’ Report as set out in Appendix I to this prospectus.
COMPLIANCE ADVISOR
In accordance with Rule 3A.19 of the Listing Rules, our Company has appointed Red Sun
Capital Limited as our compliance advisor (the “ Compliance Advisor ”). Pursuant to Rule
3A.23 of the Listing Rules, our Company will consult with and seek advice from the
compliance advisor on a timely basis in the following circumstances:
(a) before the publication of any regulatory announcement, circular or financial report
required by regulatory authorities or applicable laws;
(b) where a transaction, which might be a notifiable or connected transaction under
Chapter 14 or 14A of the Listing Rules, is contemplated including share issues and
share repurchases;
(c) where our Company proposes to use the proceeds of the Listing in a manner
different from that detailed in this prospectus or where the business activities,
developments or results of our Group deviate from any forecast, estimate, or other
information in this prospectus; and
(d) where the Stock Exchange makes an inquiry of the listed issuer under Rule 13.10 of
the Listing Rules.
Pursuant to Rule 3A.24 of the Listing Rules, the Compliance Advisor will, on a timely
basis, inform our Company of any amendment or supplement to the Listing Rules that are
announced by the Stock Exchange. The Compliance Advisor will also inform our Company of
any new or amended law, regulation or code in Hong Kong applicable to us, and advise us on
the applicable requirements under the Listing Rules and laws and regulations.
The Compliance Advisor’s term of appointment shall commence on the Listing Date and
end on the date which we distribute our annual report of financial results for the first full
financial year commencing after the Listing Date, or until the agreement is terminated,
whichever is earlier.
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OVERVIEW
Immediately following completion of the Global Offering and the Share Split (assuming
the Over-allotment Option is not exercised), Dr. Zhang will hold: (i) approximately 13.06% of
the issued share capital of our Company indirectly through Hanx Biopharmaceuticals (HK), a
company controlled by Dr. Zhang through several of his controlled entities, namely HanxBio
(BVI), Hanx Biopharmaceuticals and Caizhang Vision; (ii) approximately 40.60% of the issued
share capital of our Company indirectly through CZ Biotechnology, a company owned as to
99.9% by Dr. Zhang and 0.1% by Ms. Luo Fang, the spouse of Mr. Zhang Wanming (the brother
of Dr. Zhang); and (iii) approximately 2.24% of the issued share capital of our Company
through Wuhan Hanx, where CZ Biotechnology is a general partner. Dr. Zhang, Ms. Luo Fang,
CZ Biotechnology, Hanx Biopharmaceuticals (HK), HanxBio (BVI), Hanx
Biopharmaceuticals, Wuhan Hanx and Caizhang Vision will be presumed to be a group of
Controlling Shareholders under the Listing Rules and will be together interested in
approximately 55.89% of the issued share capital of our Company.
OUR RELATIONSHIP WITH W ATERSTONE PHARMACEUTICALS
Apart from our Company, Dr. Zhang also held directorship and shareholding interests in
Waterstone Pharmaceuticals.
Waterstone Pharmaceuticals is a company established in the PRC with limited liability on
December 17, 2009 and listed on the NEEQ (stock code: 873938). It is a company principally
engaged in the research and development and sales of chemical drugs for metabolic diseases
such as diabetes and kidney disease. Since its establishment, Dr. Zhang has been one of the
controlling shareholders of Waterstone Pharmaceuticals with: (i) approximately 8.27% shares
of Waterstone Pharmaceuticals together with Ms. Luo Fang
(Note 1) through Hubei Province
Tianmen Huatong Chemical Co., Ltd.* (ʮ̡), a wholly owned
subsidiary of CZ Biotechnology; and (ii) approximately 24.37% shares of Waterstone
Pharmaceuticals through Waterstone Pharmaceutical (HK) Limited. Waterstone Pharmaceutical
(HK) Limited is a wholly owned subsidiary of Waterstone Pharmaceuticals Inc., which is
owned as to directly and indirectly in aggregate approximately 92.94% by Dr. Zhang and Ms.
Cai Xiaoqing, the spouse of Dr. Zhang. Furthermore, Dr. Zhang is the chairman of the board
of directors and general manager of Waterstone Pharmaceuticals as of the Latest Practicable
Date. Waterstone Pharmaceuticals is also owned as to approximately 3.85% by Beijing Lapam
V enture Capital Center (Limited Partnership)* ( ̏ԯᎲᇂ௴ุҳ༟ʕː(Υྫ)), a
partnership where Beijing Lapam Investment Management Consulting Center (General
Partnership)* ( ̏ԯᎲᇂҳ༟၍ଣፔ༔ʕː(౷ஷΥྫ)), the general partner of Beijing Lapam
(one of our Pre-IPO Investors) and is ultimately controlled by Mr. Y u Zhihua (the ultimate
Note: On 9 October 2025, 0.1% equity interests in CZ Biotechnology held by Mr . Zhang Wanming were transferred
to Mr . Zhang Wanming’ s spouse, Ms. Luo Fang, pursuant to statutory probate procedures after the decease of
Mr . Zhang Wanming.
RELATIONSHIP WITH OUR CONTROLLING SHAREHOLDERS
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beneficial owner of Beijing Lapam and Tibet Lapam, and a director of and a board
representative of Beijing Lapam in Hangzhou Hanx). Save as disclosed above, there is no
overlapping of Shareholders between our Company and Waterstone Pharmaceutical.
Considering: (i) Waterstone Pharmaceuticals is principally engaged in the research and
development of small chemical molecules of diabetes and kidney disease-related chemical
drugs while our Group is principally engaged in the research and development of biological
large molecules in immunology-oncology therapies for cancer; (ii) the fact that the Group was
procuring active pharmaceutical ingredients for the production of HX301 from Waterstone
Pharmaceuticals does not imply that Waterstone Pharmaceuticals can produce HX301 on its
own as Waterstone Pharmaceuticals could not have independently manufactured this product to
apply for clinical trials and market approval; (iii) considering Waterstone Pharmaceuticals has
been principally engaging in the research and development and sales of chemical drugs for
metabolic diseases such as diabetes and kidney disease, to the best knowledge of the Directors,
transitioning to oncology drug development could face significant challenges including
divergent technological pathways, reallocation of research and development resources, and
market entry barriers, requiring substantial investment and multiple years to reconstruct its
technological platforms and pipeline layout; (iv) there is no overlapping of top five suppliers
between our Company and Waterstone Pharmaceuticals; and (v) except Dr. Zhang who is the
chairman of the board of directors and general manager of Waterstone Pharmaceuticals and our
Chairman and executive Director, our Group do not share any resources or administrative
functions with Waterstone Pharmaceuticals during the Track Record Period, our Group
considers that there is a clear distinction between our business and those of Waterstone
Pharmaceuticals and our Directors are of the view that there is no material competition between
our Group and Waterstone Pharmaceuticals arising from Dr. Zhang’s interests and directorship
in Waterstone Pharmaceuticals.
Furthermore, as confirmed by Dr. Zhang, the research and development of our Group
focuses on immuno-oncology, while that of Waterstone Pharmaceuticals has been focusing on
the research and development of small chemical molecules. Furthermore, Dr. Zhang is only
responsible for the overall supervision and strategy development of Waterstone
Pharmaceuticals and the daily operation and management of Waterstone Pharmaceuticals is
handled by its management team. Dr. Zhang has also confirmed that he will be able to commit
at least 60% of his working hours to our Company going forward. Based on the above, our
Company is of the view that Dr. Zhang will be able to devote sufficient time in our Company.
As of the Latest Practicable Date, none of our Controlling Shareholders and their close
associates had any interest in a business, apart from our business, which competes or is likely
to compete, either directly or indirectly, with our business, which would require disclosure
under Rule 8.10 of the Listing Rules.
RELATIONSHIP WITH OUR CONTROLLING SHAREHOLDERS
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--- page 448 ---
INDEPENDENCE FROM OUR CONTROLLING SHAREHOLDERS AND THEIR
CLOSE ASSOCIATES
We believe that we are capable of carrying on our business independently from our
Controlling Shareholders and their respective close associates (other than our Group) after the
Listing for the following reasons:
Management Independence
Our Board comprises three executive Directors, two non-executive Directors and four
independent non-executive Directors. Dr. Zhang is one of our executive Directors and
chairman of the Board. He has been involved in the management of our Group since his
appointment as a director of Hangzhou Hanx in 2017. With the support of our experienced
management team, Dr. Zhang is expected to continuously devote a sufficient portion of his time
to the day-to-day operations of our Group upon Listing. Dr. Zhang is also the director of CZ
Biotechnology, Hanx Biopharmaceuticals (HK), HanxBio (BVI), Hanx Biopharmaceuticals
and Caizhang Vision. As of the Latest Practicable Date, save for Dr. Zhang, none of our
Directors or members of our senior management held any position at our Controlling
Shareholders or their close associates.
Despite the overlapping roles assumed by Dr. Zhang as mentioned above, when
performing his duties in our Group, Dr. Zhang has been and will continue to be supported by
the separate and independent Board which comprises eight other Board members and senior
management of our Group. Moreover, each of CZ Biotechnology, Hanx Biopharmaceuticals
(HK), HanxBio (BVI), Hanx Biopharmaceuticals, Caizhang Vision and Wuhan Hanx does not
engage in other business activities. On such basis, Dr. Zhang confirmed that his involvement
in the aforementioned entities will not affect the discharge of his duties in our Group.
Each of our Directors is aware of his/her fiduciary duties as a Director, which require,
among other things, that he/she acts for the benefit and in the best interests of our Company
and does not allow any conflict between his/her duties as a Director and his/her personal
interests. In the event that there is an actual or potential conflict of interest arising out of any
transaction to be entered into between our Group and any of the Directors or their respective
close associates, the interested Director(s) shall abstain from voting at the relevant Board
meetings of our Company in respect of such transactions and shall not be counted in the
quorum.
Our Board comprises nine Directors, including four independent non-executive Directors,
which represent one-third of the members of our Board. Our independent non-executive
Directors have extensive experience in corporate management and governance, and they are
appointed to ensure that our Board will only make decisions after due consideration of
independent and impartial opinions. Certain matters of our Company must always be referred
to the independent non-executive Directors for review.
RELATIONSHIP WITH OUR CONTROLLING SHAREHOLDERS
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--- page 449 ---
We have adopted a series of corporate governance measures to manage conflicts of
interest, if any, between our Group and our Controlling Shareholders that would support our
independent management. For details, see the paragraph headed “Corporate Governance
Measures” in this section below. Based on the reasons above, our Directors are of the view that
our Group is capable of managing our business independently from our Controlling
Shareholders and their respective close associates after the Listing.
Based on the reasons above, our Directors are of the view that our Group is capable of
managing our business independently from our Controlling Shareholders and their respective
close associates after the Listing.
Operational Independence
We have full rights to make all decisions on, and carry out, our own business operation
independently from our Controlling Shareholders and their respective close associates and will
continue to do so after the Listing. Our Group is able to operate without reliance on our
Controlling Shareholders and their respective close associates.
Research and development
We have our own R&D platform, personnel and production facilities which are
independent from our Controlling Shareholders and their respective close associates. As of the
Latest Practicable Date, our R&D platforms had employed 20 members, who were all full-time
employees of our Group and did not hold any position in our Controlling Shareholders or their
respective close associates. In addition, our Group owns over two registered patents in the PRC
and other countries which are necessary for our R&D and operations. With such independent
R&D platforms, an experienced and independent R&D team and self-owned patents, our
Directors believe that we have all the requisite resources to carry on our R&D process
independently.
Access to suppliers and business partners
We have independent access to our suppliers as well as our business partners. Our
suppliers and business partners bases are diversified and unrelated to our Controlling
Shareholders and their respective close associates.
Operational facilities and administration
We have independent R&D platform office. In addition, we have a full-time management
team and staff to carry out our own administration and operation independently from our
Controlling Shareholders and their respective close associates. All key administrative functions
have been and will be carried out by our own without reliance or the support of our Controlling
Shareholders and their respective close associates.
RELATIONSHIP WITH OUR CONTROLLING SHAREHOLDERS
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--- page 450 ---
Employees
As of the Latest Practicable Date, save for Dr. Zhang, all of our full-time employees did
not have any employment relationship with our Controlling Shareholders and their respective
close associates and were primarily recruited through both internal referrals and external
sources such as campus recruitment, recruiting websites and third-party recruiters.
We have established a protocol in relation to management of conflict of interests (the
“Protocol ”). Pursuant to the Protocol, each of the member of the Board (including Dr. Zhang)
and senior management of our Company is required to fill in and sign a declaration of interest
form by the end of each year. Furthermore, they are required to report potential conflict of
interests to the Board within five working days when they first become aware of such potential
conflict of interest. After receiving reporting of potential conflict of interests, the conflict of
interests committee, comprising of Dr. Bi Honggang (independent non-executive Director), Dr.
Li (the chief executive officer), Mr. Zhang Hui (the chief financial officer) and the responsible
person of our legal department, will determine by majority vote whether a conflict of interest
situation arises. In case of a conflict of interests situation, the relevant person (which also
includes Dr. Zhang) is required to disclose the situation, be subject to questions from other
members of our Board and be excluded from the quorum of the meeting.
Based on the reasons above, our Directors are of the view that we have full rights to make
all decisions on, and to carry out, our own business operations independently from our
Controlling Shareholders and their respective close associates and will continue to do so after
the Listing.
Connected Transactions
During and subsequent to the Track Record Period, our Group has procured and is
expected to continue to procure (i) active pharmaceutical ingredients for the production of
HX301 and the stability testing services for the active pharmaceutical ingredients; (ii) other
raw materials that does not require testing services for the production of HX301; and (iii) small
molecules from Waterstone Pharmaceuticals and Hubei Waterstone Biopharmaceutical
Technology Co., Ltd. (ʮ̡)( “ Hubei Waterstone ”), a wholly-
owned subsidiary of Waterstone Pharmaceuticals. These transactions will constitute continuing
connected transactions of our Group upon the Listing under the Listing Rules. For further
details, please refer to the section headed “Connected Transactions” in this prospectus. The
transaction amounts between our Group and Waterstone Pharmaceuticals amounted to
approximately 1.98%, 0.05% and 1.17% of our total amount of R&D cost for the two years
ended December 31, 2023 and 2024 and the eight months ended August 31, 2025. Our Group
has independent access to other suppliers that supply active pharmaceutical ingredients for the
production of HX301, the respective stability testing services for the active pharmaceutical
ingredients, other raw materials for the production of HX301 and small molecules that can
serve as substitutes of the raw materials procured from and the stability testing services
provided by Waterstone Pharmaceuticals and Hubei Waterstone at comparable terms, and has
maintained an approved list of suppliers, which contains two suppliers that are listed
RELATIONSHIP WITH OUR CONTROLLING SHAREHOLDERS
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--- page 451 ---
companies and Independent Third Parties as of the Latest Practicable Date, from which our
Group can readily source substitutes form. As such, our Directors are of the view that the
transactions with Waterstone Pharmaceuticals and Hubei Waterstone will not affect our
operational independence. The foregoing connected transactions are entered into in the
ordinary and usual course of business of our Group and our Directors confirm that the terms
of such transactions are determined at arm’s length negotiations and are no less favorable to
our Company than terms offered by independent third parties. Our Directors believe that the
continuing connected transactions between our Company and our Controlling Shareholders and
their close associates do not indicate any undue reliance by our Company on our Controlling
Shareholders and are beneficial to our Company and our Shareholders as a whole.
Based on the above, our Directors believe that we are able to operate independently of our
Controlling Shareholders and their close associates (excluding our Group).
Financial Independence
We have an independent financial system and make financial decisions according to our
own business needs. We also have our own internal control and accounting systems, accounting
and finance department for discharging the treasury function, which all are independent from
our Controlling Shareholders and their respective close associates.
Our Group does not have any outstanding loans, advances or balances due to or from our
Controlling Shareholders or their respective close associates which are not arising out of the
ordinary course of business that will remain outstanding as of the Listing Date. All guarantee
provided by our Controlling Shareholders or their respective close associates on the
borrowings of our Group had been released as of the Latest Practicable Date. We are capable
of obtaining financing from Independent Third Parties without relying on any guarantee or
security provided by our Controlling Shareholders or their respective close associates and we
received a series of Pre-IPO Investments from Independent Third Party investors as of the
Latest Practicable Date. For details of the Pre-IPO Investments, please refer to the paragraph
headed “History, Development and Corporate Structure — Pre-IPO Investments” in this
prospectus.
Based on the above, our Directors believe that we are able to conduct our business
independently from our Controlling Shareholders and their respective close associates from a
financial perspective and are able to maintain financial independence and would not place
undue reliance on our Controlling Shareholders or their respective close associates.
DEED OF NON-COMPETITION
Each of our Controlling Shareholders has given certain non-competition undertakings in
favour of our Company (for itself and as trustee for each of our subsidiaries) under the Deed
of Non-Competition, pursuant to which each of our Controlling Shareholders, jointly and
severally, warrants and undertakes with our Company that, from the Listing and ending on the
occurrence of the earlier of:
RELATIONSHIP WITH OUR CONTROLLING SHAREHOLDERS
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(i) any of our Controlling Shareholders and his/its close associates and/or successor,
individually and/or collectively, cease to own 30% (or such percentage as may from
time to time be specified in the Listing Rules as being the threshold for determining
a controlling shareholder of a company) or more of the then entire issued share
capital of our Company; or
(ii) the Shares cease to be listed on the Stock Exchange (except for temporary
suspension of the Shares due to any reason),
he/it will not, and will procure any Controlling Shareholder and his/its close associates
(collectively, “ Controlled Persons ”) and any company directly or indirectly controlled by
him/it (which for the purpose of the Deed of Non-Competition, shall not include any member
of our Group) (the “ Controlled Company ”) not to: either on his/its own or in conjunction with
any body corporate, partnership, joint venture or other contractual agreement, whether directly
or indirectly, whether for profit or not, carry on, participate in, hold, engage in, acquire or
operate, or provide any form of assistance to any person, firm or company (except members of
our Group) to conduct any business which, directly or indirectly, competes or may compete
with the business presently carried on by our Company or any of our subsidiaries or any other
business that may be carried on by any of them from time to time during the term of the Deed
of Non-Competition, in the PRC or such other places as our Company or any of our subsidiaries
may conduct or carry on business from time to time, including but not limited to the research
and development of immunology-oncology therapies for cancer and the development of
therapeutic biological products (the “ Restricted Business ”).
Such non-competition undertakings do not apply to:
(i) the holding of Shares or other securities issued by our Company or any of our
subsidiaries from time to time;
(ii) the holding of shares or other securities in any company which has an involvement
in the Restricted Business, provided that such shares or securities are listed on a
recognized stock exchange and the aggregate interest of our Controlling Shareholder
and his/its associates (as “interest” is construed in accordance with the provisions
contained in Part XV of the SFO) does not amount to more than 10% of the relevant
share capital of the company in question;
(iii) the contracts and other agreements entered into between our Group and our
Controlling Shareholder and/or his/its close associates; and
(iv) the involvement, participation or engagement of our Controlling Shareholders
and/or his/its close associates in the Restricted Business in relation to which our
Company has agreed in writing to such involvement, participation or engagement,
following a decision by our independent non-executive Directors to allow such
involvement, participation or engagement subject to any conditions our independent
non-executive Directors may require to be imposed.
RELATIONSHIP WITH OUR CONTROLLING SHAREHOLDERS
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--- page 453 ---
New business opportunity
If any Controlling Shareholder, any of his/its connected persons and/or any Controlled
Company (the “ Offeree ”) is offered or becomes aware of any business opportunity directly or
indirectly to engage in or own the Restricted Business (the “ New Business Opportunity ”):
(i) he/it shall promptly notify our Company of such New Business Opportunity in
writing and refer the same to our Company for consideration; and
(ii) he/it shall not, and shall procure that his/its Controlled Persons or Controlled
Companies not to, invest or participate in any New Business Opportunity, unless
such New Business Opportunity is rejected by the independent committee of our
Board (the “ Independent Board Committee ”) comprising our independent non-
executive Directors from time to time who do not have any material interest in the
Restricted Business and/or the New Business Opportunity and the principal terms of
which our Controlling Shareholders or his/its Controlled Persons or Controlled
Companies invest or participate in are no more favourable than those made available
to our Company. Our Controlling Shareholders, any Controlled Person or any
Controlled Company may only engage in the New Business Opportunity if a notice
is received from the Independent Board Committee confirming that the New
Business Opportunity is not accepted by our Company and/or does not constitute
competition with the Restricted Business. If there is a material change in the terms
and conditions of the New Business Opportunity pursued by the Offeree, the Offeree
will refer the New Business Opportunity as so revised to our Company in the manner
set out above.
GENERAL UNDERTAKINGS
To ensure the performance of the above non-competition undertakings given under the
Deed of Non-Competition, our Controlling Shareholders shall, among other things:
(i) keep our Board informed of any matter of potential conflicts of interest between our
Controlling Shareholders and our Group;
(ii) when required by our Company, provide all information necessary for the
Independent Board Committee to conduct annual examination, including all relevant
financial, operational and market information and other necessary information, with
regard to the compliance of the terms of the Deed of Non-Competition and the
enforcement thereof;
(iii) procure our Company to disclose to the public either in the annual or interim report
of our Company or issuing a public announcement in relation to any decisions made
by our Independent Board Committee with regard to the compliance of the Listing
Rules and the terms of the Deed of Non-Competition and the enforcement thereof;
RELATIONSHIP WITH OUR CONTROLLING SHAREHOLDERS
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--- page 454 ---
(iv) where our Independent Board Committee shall deem fit, make a declaration in
relation to the compliance of the terms of the Deed of Non-Competition in the
annual or interim report of our Company, and ensure that the disclosure of
information relating to compliance with the terms of the Deed of Non-Competition
and the enforcement of it are in accordance with the requirements of the Listing
Rules;
(v) where our Independent Board Committee has rejected the New Business
Opportunity referred to by any Controlling Shareholder, any of his/its connected
persons and/or any Controlled Company, regardless of whether he/it would
thereafter invest or participate in such New Business Opportunity, procure our
Company to disclose to the public either in the annual, interim or quarterly report
of our Company or an announcement of the decision of our Independent Board
Committee regarding the decision on the New Business Opportunity and the basis
thereof; and
(vi) during the period when the Deed of Non-Competition is in force, fully and
effectually indemnify our Company against any losses, liabilities, damages, costs,
fees and expenses as a result of any breach on the part of our Controlling
Shareholders of any statement, warrant or undertaking made under the Deed of
Non-Competition.
CORPORATE GOVERNANCE MEASURES
Each of our Controlling Shareholders has confirmed that it/he has fully comprehended
its/his obligations to act in our Shareholders’ best interests as a whole. Our Directors recognize
the importance of good corporate governance in protecting our Shareholders’ interests. We
would adopt the following measures to safeguard good corporate governance standards and to
avoid potential conflict of interests between our Group and our Controlling Shareholders:
(a) as part of our preparation for the Listing, we have amended our Articles of
Association to comply with the Listing Rules. In particular, our Articles of
Association provided that, unless otherwise provided, a Director shall not vote on
any resolution approving any contract or arrangement or any other proposal in which
such Director or any of his/her associates have a material interest nor shall such
Director be counted in the quorum present at the meeting;
(b) pursuant to the Protocol, each of the member of the Board and senior management
of our Company is required to fill in and sign a declaration of interest form by the
end of each year. Furthermore, they are required to report the potential conflict of
interests to the Board within five working days when they are aware of the potential
conflict of interest. Furthermore, a Director with himself/herself or his/her close
associates having material interests shall make full disclosure in respect of matters
that may have conflict or potentially conflict with any of our interest at the meeting
of our Board, be subject to questions raised by other members of our Board and shall
RELATIONSHIP WITH OUR CONTROLLING SHAREHOLDERS
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--- page 455 ---
abstain from voting on such matters and not be counted in the quorum, unless the
attendance or participation of such Director at such meeting of the Board is
permitted under the Listing Rules;
(c) we are committed that our Board should include a balanced composition with not
less than one-third of independent non-executive Directors to ensure that our Board
is able to effectively exercise independent judgment in its decision-making process
and provide independent advice to our Shareholders. We have appointed four
independent non-executive Directors and we believe our independent non-executive
Directors possess sufficient experience and they are free of any business or other
relationship which could interfere in any material manner with the exercise of their
independent judgment and will be able to provide an impartial, external opinion to
protect the interests of our public Shareholders. For details of our independent
non-executive Directors, please refer to the paragraph headed “Directors,
Supervisors and Senior Management — Directors — Independent non-executive
Directors” in this prospectus;
(d) we have appointed Red Sun Capital Limited as our compliance advisor pursuant to
Rule 3A.19 of the Listing Rules, which will provide advice and guidance to us in
respect of compliance with the applicable laws and the Listing Rules including
various requirements relating to Directors’ duties and corporate governance;
(e) our Company has established internal control mechanisms to identify connected
transactions. Upon and after the Listing, if our Company enters into connected
transactions with our Controlling Shareholders or any of their associates, our
Company will comply with the applicable Listing Rules; and
(f) as required by the Listing Rules, our independent non-executive Directors shall
review any continuing connected transaction annually and confirm in our annual
report that such transactions have been entered into in our ordinary and usual course
of business, are either on normal commercial terms or on terms no less favorable to
us than those available to or from independent third parties and on terms that are fair
and reasonable and in the interests of our Shareholders as a whole.
Based on the above, our Directors believe that there are sufficient and adequate corporate
governance measures in place to manage existing and potential conflicts of interest that may
arise between our Group and our Controlling Shareholders, and to protect minority
shareholders’ interests after the Listing.
RELATIONSHIP WITH OUR CONTROLLING SHAREHOLDERS
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--- page 456 ---
So far as our Directors are aware, immediately following the completion of the Global
Offering, Share Split and the Conversion of Unlisted Shares into H Shares and without taking
into account any H Shares which may be issued pursuant to the exercise of the Over-allotment
Option, the following persons will have an interest and/or short position in our Shares or the
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, who are, directly or indirectly
interested in 10% or more of the nominal value of any class of our share capital carrying rights
to vote in all circumstances at shareholders’ meetings of our Company and other members of
our Group:
Interests in our Company
Name Nature of interest
Description of
Shares upon
completion of the
Global Offering,
Share Split and
the Conversion of
Unlisted Shares
into H Shares 1
Number of
Shares
Approximate
percentage of
shareholding in the
total issued share
capital of our
Company upon
completion of the
Global Offering and
Share Split (assuming
no exercise of the
Over-allotment
Option) 2
CZ Biotechnology 3 /H1118/H1118/H1118/H1118/H1118/H1118/H1118Beneficial owner;
interest held jointly
with another person
H Shares 76,138,710 55.89%
Dr. Zhang
3 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Interest in controlled
corporation; interest
held jointly with
another person
H Shares 76,138,710 55.89%
Ms. Cai Xiaoqing
(ᇹወ૶)
4 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Interest of spouse H Shares 76,138,710 55.89%
Ms. Luo Fang (ٹ3 /H1118/H1118/H1118/H1118/H1118Interest in controlled
corporation; interest
held jointly with
another person
H Shares 76,138,710 55.89%
Hanx Biopharmaceuticals
(HK)
5 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Beneficial owner H Shares 17,793,640 13.06%
SUBSTANTIAL SHAREHOLDERS
– 445 –


--- page 457 ---
Name Nature of interest
Description of
Shares upon
completion of the
Global Offering,
Share Split and
the Conversion of
Unlisted Shares
into H Shares 1
Number of
Shares
Approximate
percentage of
shareholding in the
total issued share
capital of our
Company upon
completion of the
Global Offering and
Share Split (assuming
no exercise of the
Over-allotment
Option) 2
HanxBio (BVI) 5 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Interest in controlled
corporation
H Shares 17,793,640 13.06%
Hanx Biopharmaceuticals 5 /H1118/H1118Interest in controlled
corporation
H Shares 17,793,640 13.06%
Caizhang Vision 5 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Interest in controlled
corporation
H Shares 17,793,640 13.06%
Wuhan Hanx /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Beneficial owner H Shares 3,045,070 2.24%
Beijing Lapam /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Beneficial owner H Shares 12,860,470 9.44%
Beijing Lapam Investment
Management Consulting
Center (General
Partnership) ( ̏ԯᎲᇂҳ
༟၍ଣᚥਪʕː(౷ஷΥ
ྫ)) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Interest in controlled
corporation
H Shares 12,860,470 9.44%
Beijing Lapam Management
Consulting Co., Ltd.* ( ̏
ʮ̡) /H1118
Interest in controlled
corporation
H Shares 12,860,470 9.44%
Mr. Y u Zhihua
(ശ)
6 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Interest in controlled
corporation; interest
of spouse
H Shares 14,652,130 10.76%
Ms. Sun Hui (ᅆ)
7 /H1118/H1118/H1118/H1118/H1118Interest in controlled
corporation; interest
of spouse
H Shares 14,652,130 10.76%
Hangzhou Hongye Ruiji /H1118/H1118/H1118/H1118Beneficial owner H Shares 12,860,470 9.44%
SUBSTANTIAL SHAREHOLDERS
– 446 –


--- page 458 ---
Name Nature of interest
Description of
Shares upon
completion of the
Global Offering,
Share Split and
the Conversion of
Unlisted Shares
into H Shares 1
Number of
Shares
Approximate
percentage of
shareholding in the
total issued share
capital of our
Company upon
completion of the
Global Offering and
Share Split (assuming
no exercise of the
Over-allotment
Option) 2
Hangzhou Hongye Taiji
Investment Management
Partnership (Limited
Partnership)* (ุइ
Λҳ༟၍ଣΥྫ(Υ
ྫ)) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Interest in controlled
corporation
H Shares 12,860,470 9.44%
Hangzhou Hongye
Investment Management
Co., Ltd.* (ุҳ༟
ʮ̡) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Interest in controlled
corporation
H Shares 12,860,470 9.44%
Mr. Zhang Y eyan
(ੵุ⇴) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Interest in controlled
corporation
H Shares 12,860,470 9.44%
Notes:
1. For the avoidance of doubt, both Unlisted Shares and H Shares are ordinary Shares in the share capital of our
Company, and are considered as one class of Shares.
2. The calculation is based on the total number of 136,218,830 H Shares in issue upon Listing (comprising (i)
an aggregate of 117,897,830 Shares to be converted from Unlisted Shares; and (ii) 18,321,000 Shares to be
issued pursuant to the Global Offering, without taking into account the H Shares which may be issued upon
the exercise of Over-allotment Option).
3. The 76,138,710 Shares consist of: (i) 55,300,000 Shares held by CZ Biotechnology; (ii) 17,793,640 Shares
held by Hanx Biopharmaceuticals (HK); and (iii) 3,045,070 Shares held by Wuhan Hanx.
CZ Biotechnology is legally and beneficially owned as to 99.9% by Dr. Zhang and 0.1% by Ms. Luo Fang. CZ
Biotechnology, Ms. Luo Fang and Dr. Zhang are considered as a group of controlling shareholders of our
Group pursuant to the Listing Rules. Hanx Biopharmaceuticals (HK) is controlled by HanxBio (BVI), which
is in turn controlled by Hanx Biopharmaceuticals. Hanx Biopharmaceuticals is controlled by Caizhang Vision,
which is controlled by Dr. Zhang. Furthermore, Wuhan Hanx is owned as to 75% by CZ Biotechnology, who
is also the general partner of Wuhan Hanx. Therefore, Dr. Zhang, CZ Biotechnology, Ms. Luo Fang, Hanx
Biopharmaceuticals (HK), HanxBio (BVI), Hanx Biopharmaceuticals and Caizhang Vision are deemed to be
interested in the 76,138,710 Shares.
4. Ms. Cai Xiaoqing is the spouse of Dr. Zhang and is deemed to be interested in all the Shares which Dr. Zhang
is deemed to be interested in by virtue of the SFO.
SUBSTANTIAL SHAREHOLDERS
– 447 –


--- page 459 ---
5. Hanx Biopharmaceuticals (HK) is controlled by HanxBio (BVI). HanxBio (BVI) is in turn controlled by Hanx
Biopharmaceuticals, which is controlled by Caizhang Vision. Therefore, Hanx Biopharmaceuticals (HK),
HanxBio (BVI), Hanx Biopharmaceuticals and Caizhang Vision are deemed to be interested in the 17,793,640
Shares held by Hanx Biopharmaceuticals (HK).
6. Beijing Lapam and Tibet Lapam are ultimately controlled by Mr. Y u. Furthermore, he is the spouse of Ms. Sun
Hui. Therefore, he is deemed interested in the 12,860,470 H Shares held by Beijing Lapam and 1,195,620 H
Shares held by Tibet Lapam. He is also deemed interested in the H Shares in which Ms. Sun Hui is deemed
interested in by virtue of the SFO.
7. Ms. Sun Hui is the ultimately beneficial owner of Lapam Capital. Furthermore, Ms. Sun Hui is the spouse of
Mr. Y u Zhihua. Therefore, she is interested in the 596,040 shares held by Lapam Capital and is deemed to be
interested in all the Shares which Mr. Y u Zhihua is deemed to be interested in by virtue of the SFO.
Interests in shares of other member of our Group (other than our Company)
Name of member of our
Group
Person other than
members of our
Group holding
10% or more
interests Nature of interests
Amount of
registered
capital/shares
interested in
Approximate %
of interest in the
member of our
Group
Hangzhou Hanx /H1118/H1118/H1118/H1118/H1118/H1118/H1118Wuhan Hanzhong Beneficial owner RMB2.19 million 15%
Save as disclosed above and in the paragraph headed “C. Further information about
Directors, Supervisors and Substantial Shareholders — 1. Disclosure of interests” in Appendix
VI to this prospectus, our Directors are not aware of any persons who will, immediately
following completion of the Global Offering (assuming the Over-allotment Option is not
exercised), have interests and/or short positions in Shares or underlying Shares which would
fall to be disclosed 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 nominal value of any class of share
capital carrying rights to vote in all circumstances at shareholders’ meetings of our Company
or any other member of our Group.
SUBSTANTIAL SHAREHOLDERS
– 448 –


--- page 460 ---
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, or cause their designated entities to subscribe, at the
Offer Price for such number of Offer Shares (rounded down to the nearest whole board lot of
100 H Shares) as set out in the table below (the “ Cornerstone Placing ”). The aggregate
amount of the investment contributed by the Cornerstone Investors does not include brokerage,
SFC transaction levy, AFRC transaction levy and Hong Kong Stock Exchange trading fee
which the Cornerstone Investors will pay in respect of the International Offer Shares to be
subscribed by them.
Based on the Offer Price of HK$32.00 per H Share, being the maximum Offer Price stated
in this prospectus, the total number of Offer Shares to be subscribed by the Cornerstone
Investors would be 2,917,800 Offer Shares, representing (i) approximately 15.93% of the Offer
Shares to be issued pursuant to the Global Offering and approximately 2.14% of our total
issued share capital immediately upon completion of the Global Offering (assuming the
Over-allotment Option is not exercised), and (ii) approximately 13.85% of the Offer Shares to
be issued pursuant to the Global Offering and approximately 2.10% of our total issued share
capital immediately upon completion of the Global Offering (assuming the Over-allotment
Option is fully exercised).
Our Company is of the view that the Cornerstone Placing provides an impression of
commitment, confidence and interests of the Cornerstone Investors in our Group’s business and
prospects and helps raise the profile of our Company. Our Company became acquainted with
the Cornerstone Investors through introduction by the Company’s business partners.
The Cornerstone Placing will form part of the International Offering, and, save as
otherwise obtained consent from the Stock Exchange, the Cornerstone Investors and their
respective close associates 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 rank pari passu in all respects with the fully paid
H Shares in issue and will be counted towards the public float of our Company under Rule 8.08
(as amended and replaced by Rule 19A.13A) of the Listing Rules. The three largest public
Shareholders will not hold more than 50% of the Shares held in public hands at the time of the
Listing in compliance with Rule 8.08(3) of the Listing Rules.
Immediately following the completion of the Global Offering, the Cornerstone Investors
will not, by virtue of their cornerstone investments, have any Board representation in our
Company; and none of the Cornerstone Investors will become a substantial Shareholder of 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 under each of their
respective Cornerstone Investment Agreements, as compared with other public Shareholders.
CORNERSTONE INVESTORS
– 449 –


--- page 461 ---
As confirmed by each of the Cornerstone Investors, 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 Global
Offering, other than a guaranteed allocation of the relevant Offer Shares at the final Offer
Price, following the principles as set out in Chapter 4.15 of the Guide for New Listing
Applicants.
To the best knowledge, information and belief of our Company, (i) each of the
Cornerstone Investors and their respective ultimate beneficial owner(s) is an Independent Third
Party; (ii) none of the Cornerstone Investors or their respective ultimate beneficial owner(s) is
accustomed to take instructions from our Company, Directors, Supervisors, chief executive,
Controlling Shareholders, substantial Shareholders or existing Shareholders or any of their
subsidiaries or their respective close associates in relation to the acquisition, disposal, voting
or other disposition of the Offer Shares; and (iii) none of the subscription of the Offer Shares
by the Cornerstone Investors is financed directly or indirectly by our Company, Directors,
Supervisors, chief executive, Controlling Shareholders, substantial Shareholders or existing
Shareholders or any of their subsidiaries or their respective close associates.
To the best knowledge of our Company and as confirmed by each of the Cornerstone
Investors, each of the Cornerstone Investors makes independent investment decisions, and their
subscription under the Cornerstone Placing would be financed by their own internal resources
and they have sufficient funds to settle their respective investment under the Cornerstone
Placing. 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 or its shareholders or other regulatory authorities is required for the relevant
Cornerstone Placing.
The Cornerstone Investors have agreed to fully pay for the relevant Offer Shares that they
have subscribed before dealings in the Company’s H Shares commence on the Stock Exchange.
Certain Cornerstone Investors have agreed that our Company and the Joint Overall
Coordinators in their sole discretion may defer the delivery of all or part of the Offer Shares
it will subscribe to a date later than the Listing Date. Where delayed delivery takes place, the
relevant Cornerstone Investor that may be affected by such delayed delivery has agreed that it
shall nevertheless fully pay for the relevant Offer Shares before the Listing. As such, there will
be no deferred settlement of the Offer Shares to be subscribed by the Cornerstone Investors
pursuant to the Cornerstone Investment Agreements.
The total number of Offer Shares to be subscribed by the Cornerstone Investors may be
affected by reallocation of the Offer Shares between the International Offering and the Hong
Kong Public Offering. If the total demand for H Shares in the Hong Kong Public Offering falls
within any of the circumstances as set out in the section headed “Structure of the Global
Offering — The Hong Kong Public Offering — Reallocation” in this prospectus, our Company
and the Joint Overall Coordinators have the absolute discretion, but are not obliged, to deduct
the number of Offer Shares to be subscribed by the Cornerstone Investors in order to satisfy
the public demands under the Hong Kong Public Offering pursuant to Practice Note 18 of the
CORNERSTONE INVESTORS
– 450 –


--- page 462 ---
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 December 22, 2025.
THE CORNERSTONE INVESTORS
The information about our Cornerstone Investors set forth below has been provided by the
Cornerstone Investors in connection with the Cornerstone Placing.
Fund Resources
Fund Resources Investment Holding Group Company Limited (“ Fund Resources ”) is an
investment company incorporated in Hong Kong in 2013. Fund Resources is primarily engaged
in investments, with key focus on the energy, resources, chemical, real estate and financial
sectors. Fund Resources is wholly owned by Funde Sino Life Insurance Company Limited ( బ
ʮ̡), which has a highly fragmented investor base, with no
shareholder holding 30% or more of its shares. Funde Sino Life Insurance Company Limited
is a national professional life insurance company based in Shenzhen.
Sage Partners Master Fund
Sage Partners Master Fund (“ Sage Partners ”) is an exempted company with limited
liability incorporated in the Cayman Islands, and is managed by Sage Partners Limited, a Hong
Kong incorporated SFC Type 9 licensed investment management company established in 2019.
Sage Partners is a discretionary fund and it primarily focuses on investment opportunities in
the healthcare sector and other emerging technologies. None of the investors in Sage Partners
Master Fund holds 30% or more of its interest. To the best knowledge of our Directors, each
of Sage Partners and its management company is an Independent Third Party.
Guotai Junan Investments (Hong Kong) Limited (in connection with the Kunyang OTC
Swaps)
Guotai Junan Investments (Hong Kong) Limited (“ GTINV ”) and Guotai Haitong
Securities Co., Ltd (“ GTHT ”) will enter into a series of cross border delta-one OTC swap
transactions (the “ Kunyang OTC Swaps ”) with each other and with Kunyang New Pattern No.
1 Private Securities Investment Fund (҅1ږthe “ GTHT
Ultimate Client (Kunyang) ”), pursuant to which GTINV will hold the Offer Shares on a
non-discretionary basis to hedge the Kunyang OTC Swaps while the economic risks and returns
of the underlying Offer Shares are passed to the GTHT Ultimate Client (Kunyang), subject to
customary fees and commissions. The Kunyang OTC Swaps will be fully funded by the GTHT
Ultimate Client (Kunyang).
CORNERSTONE INVESTORS
– 451 –


--- page 463 ---
During the terms of the Kunyang OTC Swaps, all economic returns of the Offer Shares
subscribed by GTINV will be passed to the GTHT Ultimate Client (Kunyang) and all economic
loss shall be borne by the GTHT Ultimate Client (Kunyang) through the Kunyang OTC Swaps,
and GTINV will not take part in any economic return or bear any economic loss in relation to
the Offer Shares. Despite that GTINV will hold the legal title of the Offer Shares by itself, it
will not exercise the voting rights attaching to the relevant Offer Shares during the terms of the
Kunyang OTC Swaps according to its internal policy. To the best of GTINV’s knowledge
having made all reasonable inquiries, the GTHT Ultimate Client (Kunyang) is an independent
third party of GTINV , GTHT and the companies which are members of the same group of
GTHT.
GTINV is a Hong Kong incorporated company. Its principal business activities are trading
and investments. It is indirectly wholly owned by GTHT, a leading securities firm in China
with its shares dually listed in both Shanghai (SSE: 601211) and Hong Kong (HKEX: 2611).
The GTHT Ultimate Client (Kunyang), i.e. Kunyang New Pattern No. 1 Private Securities
Investment Fund (҅1ږis an investment fund managed by
Shanghai Kunyang Private Fund Management Co., Ltd. (ʮ̡)
(“Kunyang Shanghai ”). No ultimate beneficial owner holds 30% or more of interests in
Kunyang New Pattern No. 1 Private Securities Investment Fund (҅1໮ӷ෍ᗇՎҳ༟
ږ.)
Kunyang Shanghai was established in Shanghai in 2016. Kunyang Shanghai was
ultimately owned by Zhou Kejun (ё), Zhou Tingting ( մణణ) and Li Boyang (ݱa s
to 75%, 20% and 5%, respectively. Kunyang Shanghai is licensed as a private invest fund
manager (ࣸ.)
Haitong International Securities Company Limited (“ Haitong International Securities ”)
is one of the Overall Coordinators, Joint Global Coordinators, Joint Bookrunners, Joint Lead
Managers and the Underwriters of the Global Offering. GTINV and Haitong International
Securities are indirectly wholly-owned subsidiaries of GTHT. Accordingly, GTINV is a
connected client of Haitong International Securities. We have applied for, and the Stock
Exchange has granted, a written consent under paragraph 1C(1) of Appendix F1 to the Listing
Rules to allow GTINV to subscribe for Offer Shares as a Cornerstone Investor. For more
details, please refer to the paragraphs headed “Waivers from Strict Compliance with the Listing
Rules and Exemption from Compliance with the Companies (Winding Up and Miscellaneous
Provision) Ordinance — Consent in Respect of the Proposed Subscription of H Shares by a
Connected Client” in this prospectus.
TFI Investment Fund SPC (acting for and on behalf of its segregated portfolio, TFI
Lakeside SP)
TFI Lakeside SP (the “ TFI Fund ”) is a segregated portfolio of TFI Investment Fund SPC,
an exempted company incorporated under the laws of the Cayman Islands and registered as a
segregated portfolio company and is an Independent Third Party. 100% of the management
CORNERSTONE INVESTORS
– 452 –


--- page 464 ---
shares of TFI Investment Fund SPC are held by TFI Asset Management (Cayman) Ltd. The
investment manager of the TFI Fund is TFI Asset Management Limited. Both TFI Asset
Management (Cayman) Ltd. and TFI Asset Management Limited are indirectly wholly owned
by Tianfeng Securities Co., Ltd. (a company listed on the Shanghai Stock Exchange (stock
code: 601162)). TFI Asset Management Limited is a company incorporated in Hong Kong and
licensed to carry out Type 4 (advising on securities), Type 5 (advising on futures contracts),
and Type 9 (asset management) regulated activities under the SFO in Hong Kong by the SFC.
No single participating investor holds 30% or more interests in the TFI Fund.
TFI Securities and Futures Limited (“ TFI Securities ”) is one of the Joint Global
Coordinators, Joint Bookrunners, Joint Lead Managers and the Underwriters of the Global
Offering. As TFI Securities is also wholly owned by Tianfeng Securities, TFI Investment Fund
SPC is a connected client of TFI Securities for the purpose of the Placing Guidelines. We have
applied for, and the Stock Exchange has granted, a written consent under paragraph 1C(1) of
Appendix F1 to the Listing Rules to allow TFI Investment Fund SPC to subscribe for Offer
Shares as a cornerstone investor. For more details, please refer to the paragraphs headed
“Waivers from Strict Compliance with the Listing Rules and Exemption from Compliance with
the Companies (Winding Up and Miscellaneous Provision) Ordinance — Consent in Respect
of the Proposed Subscription of H Shares by a Connected Client” in this prospectus.
Main Source Capital Limited
Main Source Capital Limited is an investment company incorporated in Hong Kong on 8
December 2022 and primarily focuses on financial investments. Main Source Capital Limited
is wholly owned by Mr. Xue Shouguang ( ᑝςΈ), who is a veteran investor and has invested
in a series of listed companies.
YStem Capital
YStem Holding Limited (“ YStem Capital ”) is an investment company incorporated in
Hong Kong on 10 September 2024 and primarily focuses on investments in the technology
sector. YStem Capital is held as to (i) 60% by Mr. Deng Han ( ቎ጫ), who has strategic advisory
and private equity experience, and (ii) 40% by Mr. Song Yibo (تwho has a track record
in investment banking, both of whom are Independent Third Parties.
Awaken Thunder Capital Limited
Awaken Thunder Capital Limited (“ Awaken Thunder ”) (ʮ̡)i sa n
investment company incorporated in Hong Kong and licensed by the SFC to carry out Type 1
(dealing in securities), Type 4 (advising on securities) and Type 9 (asset management)
regulated activities under the SFO in Hong Kong. Awaken Thunder Capital Limited is owned
as to 34% by Ms. Zhou Y uan, 33% by Mr. Wu Bo and 33% by Mr. Zhang Wenzhen. Each of
the foregoing shareholders is an Independent Third Party.
CORNERSTONE INVESTORS
– 453 –


--- page 465 ---
The table below sets forth the details of the Cornerstone Placing:
Based on the Offer Price of HK$32.00 per H Share
Assuming the
Over-allotment Option is
not exercised
Assuming the
Over-allotment Option is
exercised in full
Cornerstone Investor
Total
investment amount (1)
Number of
Offer Shares to
be acquired (4)
Approximate %
of the total
Offer Shares
Approximate %
of the total
issued Shares
immediately
upon the
completion of the
Global
Offering (5)
Approximate %
of the total
Offer Shares
Approximate %
of the total
issued Shares
immediately
upon the
completion of the
Global
Offering (5)
Fund Resources /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
US$5.00
million
HK$38.92 (2)
million 1,216,100 6.64% 0.89% 5.77% 0.88%
Sage Partners /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
US$1.50
million
HK$11.67 (2)
million 364,800 1.99% 0.27% 1.73% 0.26%
GTINV (in connection with
the Kunyang OTC Swaps) /H1118
US$1.41 (3)
million
HK$11.00 (3)
million 343,700 1.88% 0.25% 1.63% 0.25%
TFI Investment Fund SPC
(acting for and on behalf
of its segregated portfolio,
TFI Lakeside SP) /H1118/H1118/H1118/H1118/H1118
US$1.28
(2)
million
HK$10.00
million 312,500 1.71% 0.23% 1.48% 0.22%
Main Source Capital
Limited /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
US$1.28 (2)
million
HK$10.00
million 312,500 1.71% 0.23% 1.48% 0.22%
YStem Capital /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
US$1.00
million
HK$7.78 (2)
million 243,200 1.33% 0.18% 1.15% 0.18%
Awaken Thunder Capital
Limited /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
US$0.51 (2)
million
HK$4.00
million 125,000 0.68% 0.09% 0.59% 0.09%
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
US$12.00
million
HK$93.37
million 2,917,800 15.93% 2.14% 13.85% 2.10%
Notes:
(1) Exclusive of brokerage, the SFC transaction levy, the Stock Exchange trading fee and the AFRC transaction
levy.
(2) Calculated for illustrative purpose based on the exchange rates as disclosed in “Information about this
Prospectus and the Global Offering – Exchange Rate Conversion” in this prospectus.
(3) GTINV agreed to subscribe for Offer Shares at the Offer Price in the aggregate amount of RMB10 million. The
amount of Hong Kong dollars and U.S. dollars were calculated for illustrative purpose based on the exchange
rates as disclosed in “Information about this Prospectus and the Global Offering – Exchange Rate Conversion”
in this prospectus.
(4) Rounded down to the nearest whole board lot of 100 H Shares.
(5) Assuming no other changes are made to the issued share capital of our Company between the Latest Practicable
Date and the Listing.
CORNERSTONE INVESTORS
– 454 –


--- page 466 ---
Based on the Offer Price of HK$30.00 per H Share
Assuming the
Over-allotment Option is
not exercised
Assuming the
Over-allotment Option is
exercised in full
Cornerstone Investor
Total
investment amount (1)
Number of
Offer Shares to
be acquired (4)
Approximate %
of the total
Offer Shares
Approximate %
of the total
issued Shares
immediately
upon the
completion of the
Global
Offering (5)
Approximate %
of the total
Offer Shares
Approximate %
of the total
issued Shares
immediately
upon the
completion of the
Global
Offering (5)
Fund Resources /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
US$5.00
million
HK$38.92 (2)
million 1,297,200 7.08% 0.95% 6.16% 0.93%
Sage Partners /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
US$1.50
million
HK$11.67 (2)
million 389,100 2.12% 0.29% 1.85% 0.28%
GTINV (in connection with
the Kunyang OTC Swaps) /H1118
US$1.41 (3)
million
HK$11.00 (3)
million 366,600 2.00% 0.27% 1.74% 0.26%
TFI Investment Fund SPC
(acting for and on behalf
of its segregated portfolio,
TFI Lakeside SP) /H1118/H1118/H1118/H1118/H1118
US$1.28
(2)
million
HK$10.00
million 333,300 1.82% 0.24% 1.58% 0.24%
Main Source Capital
Limited /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
US$1.28 (2)
million
HK$10.00
million 333,300 1.82% 0.24% 1.58% 0.24%
YStem Capital /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
US$1.00
million
HK$7.78 (2)
million 259,400 1.42% 0.19% 1.23% 0.19%
Awaken Thunder Capital
Limited /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
US$0.51 (2)
million
HK$4.00
million 133,300 0.73% 0.10% 0.63% 0.10%
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
US$12.00
million
HK$93.37
million 3,112,200 16.99% 2.28% 14.77% 2.24%
Notes:
(1) Exclusive of brokerage, the SFC transaction levy, the Stock Exchange trading fee and the AFRC transaction
levy.
(2) Calculated for illustrative purpose based on the exchange rates as disclosed in “Information about this
Prospectus and the Global Offering – Exchange Rate Conversion” in this prospectus.
(3) GTINV agreed to subscribe for Offer Shares at the Offer Price in the aggregate amount of RMB10 million. The
amount of Hong Kong dollars and U.S. dollars were calculated for illustrative purpose based on the exchange
rates as disclosed in “Information about this Prospectus and the Global Offering – Exchange Rate Conversion”
in this prospectus.
(4) Rounded down to the nearest whole board lot of 100 H Shares.
(5) Assuming no other changes are made to the issued share capital of our Company between the Latest Practicable
Date and the Listing.
CORNERSTONE INVESTORS
– 455 –


--- page 467 ---
Based on the Offer Price of HK$28.00 per H Share
Assuming the
Over-allotment Option is
not exercised
Assuming the
Over-allotment Option is
exercised in full
Cornerstone Investor
Total
investment amount (1)
Number of
Offer Shares to
be acquired (4)
Approximate %
of the total
Offer Shares
Approximate %
of the total
issued Shares
immediately
upon the
completion of the
Global
Offering (5)
Approximate %
of the total
Offer Shares
Approximate %
of the total
issued Shares
immediately
upon the
completion of the
Global
Offering (5)
Fund Resources /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
US$5.00
million
HK$38.92 (2)
million 1,389,800 7.59% 1.02% 6.60% 1.00%
Sage Partners /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
US$1.50
million
HK$11.67 (2)
million 416,900 2.28% 0.31% 1.98% 0.30%
GTINV (in connection with
the Kunyang OTC Swaps) /H1118
US$1.41 (3)
million
HK$11.00 (3)
million 392,800 2.14% 0.29% 1.86% 0.28%
TFI Investment Fund SPC
(acting for and on behalf
of its segregated portfolio,
TFI Lakeside SP) /H1118/H1118/H1118/H1118/H1118
US$1.28
(2)
million
HK$10.00
million 357,100 1.95% 0.26% 1.70% 0.26%
Main Source Capital
Limited /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
US$1.28 (2)
million
HK$10.00
million 357,100 1.95% 0.26% 1.70% 0.26%
YStem Capital /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
US$1.00
million
HK$7.78 (2)
million 277,900 1.52% 0.20% 1.32% 0.20%
Awaken Thunder Capital
Limited /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
US$0.51 (2)
million
HK$4.00
million 142,800 0.78% 0.10% 0.68% 0.10%
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
US$12.00
million
HK$93.37
million 3,334,400 18.20% 2.45% 15.83% 2.40%
Notes:
(1) Exclusive of brokerage, the SFC transaction levy, the Stock Exchange trading fee and the AFRC transaction
levy.
(2) Calculated for illustrative purpose based on the exchange rates as disclosed in “Information about this
Prospectus and the Global Offering – Exchange Rate Conversion” in this prospectus.
(3) GTINV agreed to subscribe for Offer Shares at the Offer Price in the aggregate amount of RMB10 million. The
amount of Hong Kong dollars and U.S. dollars were calculated for illustrative purpose based on the exchange
rates as disclosed in “Information about this Prospectus and the Global Offering – Exchange Rate Conversion”
in this prospectus.
(4) Rounded down to the nearest whole board lot of 100 H Shares.
(5) Assuming no other changes are made to the issued share capital of our Company between the Latest Practicable
Date and the Listing.
CORNERSTONE INVESTORS
– 456 –


--- page 468 ---
CLOSING CONDITIONS
The obligation of each Cornerstone Investor to subscribe for the Offer Shares under the
respective Cornerstone Investment Agreement is subject to, among other things, the following
closing conditions:
(a) the Underwriting Agreements for the Hong Kong Public Offering and the
International Offering 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 of the aforesaid
Underwriting Agreements having been terminated;
(b) the Offer Price having been agreed upon between our Company and the Joint Overall
Coordinators (for themselves and on be half of the Underwriters);
(c) the Stock Exchange having granted the approval for the listing of, and permission
to deal in, the H Shares (including the H Shares subscribed for by the Cornerstone
Investors) as well as other applicable waivers and approvals, and such approval,
permission or waiver having not been revoked prior to the commencement of
dealings in the H Shares on the Stock Exchange;
(d) the CSRC having accepted the CSRC filings and published the filing results on its
website, and such notice of acceptance and/or filing results published not having
otherwise been rejected, withdrawn, revoked or invalidated prior to the
commencement of dealings in the H Shares on the Stock Exchange;
(e) no laws shall have been enacted or promulgated by any governmental authority
which prohibits the consummation of the transactions contemplated in the Global
Offering or in the respective 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, including, without limitation, any
applicable sanctions or other legal restrictions that would prohibit or restrict the
Cornerstone Investors from proceeding with the subscription of the H Shares under
the Cornerstone Placing; and
(f) the respective representations, warranties, acknowledgements, undertakings and
confirmations of the relevant Cornerstone Investor under the respective Cornerstone
Investment Agreement are accurate and true in all respects and not misleading or
deceptive and that there is no material breach of the Cornerstone Investment
Agreement on the part of the relevant Cornerstone Investor.
CORNERSTONE INVESTORS
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RESTRICTIONS ON THE CORNERSTONE INVESTORS
Each of the Cornerstone Investors has agreed that without the prior written consent of our
Company, the Sole Sponsor and the Joint Overall Coordinators, it will not, whether directly or
indirectly, at any time during the period of six months from the Listing Date (the “ Lock-up
Period ”), dispose of, in any way, any Offer Shares or any interest in any company or entity
holding such Offer Shares that they have purchased pursuant to the relevant Cornerstone
Investment Agreement, save for certain limited circumstances, such as transfers to any of its
wholly-owned subsidiaries who will be bound by the same obligations of such Cornerstone
Investor, including the Lock-up Period restriction.
CORNERSTONE INVESTORS
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IMMEDIATELY BEFORE THE GLOBAL OFFERING
As of the Latest Practicable Date, the registered share capital of our Company was
RMB11,789,783, consisting of 11,789,783 Unlisted Shares, with a nominal value of RMB1
each.
UPON THE COMPLETION OF THE GLOBAL OFFERING
Immediately after the Global Offering, Share Split and Conversion of Unlisted Shares
into H Shares (assuming that the Over-allotment Option is not exercised), the share capital of
our Company will be as follows:
Description of Shares Number of Shares
Approximate %
of the enlarged
issued share
capital after the
Global Offering
H Shares to be converted from Unlisted Shares /H1118/H1118/H1118117,897,830 86.55%
H Shares to be issued pursuant to the
Global Offering /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111818,321,000 13.45%
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118136,218,830 100%
Assuming the Over-allotment Option is exercised in full, the share capital of our
Company immediately following the Global Offering, Share Split and Conversion of Unlisted
Shares into H Shares will be as follows:
Description of Shares Number of Shares
Approximate %
of the enlarged
issued share
capital after the
Global Offering
H Shares to be converted from Unlisted Shares /H1118/H1118/H1118117,897,830 84.84%
H Shares to be issued pursuant to the
Global Offering /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111821,069,100 15.16%
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118138,966,930 100%
ASSUMPTIONS
The above tables assume that the Global Offering becomes unconditional but does not
take into account any Shares which may be issued or repurchased by us pursuant to the general
mandates granted to our Directors to issue or repurchase Shares.
SHARE CAPITAL
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PUBLIC FLOAT REQUIREMENTS
Rules 8.08(1)(a) and (b) of the Listing Rules require there to be an open market in the
securities for which listing is sought and for a sufficient public float of an issuer’s listed
securities to be maintained. This normally means that (i) at least 25% of the issuer’s total
issued share capital must at all times be held by the public; and (ii) where an issuer has one
class of securities or more apart from the class of securities for which listing is sought, the total
securities of the issuer held by the public (on all regulated market(s) including the Stock
Exchange) at the time of listing must be at least 25% of the issuer’s total issued share capital.
In light of the above, at the time of the Listing, at least 25% of the total issued share
capital of our Company shall be held by the public (as defined in the Listing Rules).
OUR SHARES
Upon completion of the Listing, Share Split and the Conversion of Unlisted Shares into
H Shares, all of our Unlisted Shares will be converted into H Shares and are regarded as one
class of Shares. Apart from certain qualified domestic institutional investors in the PRC,
certain PRC qualified investors under the Shanghai-Hong Kong Stock Connect and the
Shenzhen-Hong Kong Stock Connect, and other persons who are entitled to hold our H Shares
pursuant to relevant PRC laws and regulations or upon approvals of any competent authorities,
H Shares generally cannot be subscribed by or traded among legal and natural persons of the
PRC.
The Shares will rank pari passu with each other in all respects and, in particular, will rank
equally for all dividends or distributions declared, paid or made after the date of this
prospectus.
All dividends for H Shares will be denominated and declared in Renminbi, and paid in
Hong Kong dollars or Renminbi, whereas all dividends for Unlisted Shares will be paid in
Renminbi. Other than cash, dividends could also be paid in the form of shares.
CONVERSION OF UNLISTED SHARES INTO H SHARES
Our Unlisted Shares are unlisted Shares which are currently not listed or traded on any
stock exchange.
According to stipulations by the State Council securities regulatory authority and the
Articles of Association, the Unlisted Shares may be converted into H Shares. Such converted
Shares may be listed or traded on an overseas stock exchange provided that the conversion and
trading of such converted Shares shall only be effected after all requisite internal approval
process have been duly completed and the approval from the relevant PRC regulatory
authorities (including the CSRC) and the relevant overseas stock exchange have been obtained.
SHARE CAPITAL
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In addition, such conversion and trading shall in all respects comply with the regulations
prescribed by the State Council securities regulatory authority and the regulations,
requirements and procedures prescribed by the relevant overseas stock exchange.
If any of the Unlisted Shares are to be converted to H Shares and to be traded on the Stock
Exchange, such conversion requires the approval of the relevant PRC regulatory authorities,
including the CSRC. Approval of the Stock Exchange is required for the listing of such
converted Shares on the Stock Exchange. Subject to fulfilling the procedures below, our
Company may apply for the listing of all or any portion of the Unlisted Shares on the Stock
Exchange as H Shares before any proposed conversion so that the conversion process can be
completed promptly upon notice to the Stock Exchange and delivery of shares for entry on the
H Share register. As any listing of additional Shares after our Company’s initial listing on the
Stock Exchange is ordinarily considered by the Stock Exchange to be a purely administrative
matter, it does not require prior application for listing as of the time of our Company’s initial
listing in Hong Kong. A vote by our Shareholders in shareholders’ meeting is not required for
the listing and trading of the converted Shares on an overseas stock exchange. Any listing of
the converted Shares on the Stock Exchange after the initial listing is subject to prior
notification by way of announcement to inform Shareholders and the public of any proposed
conversion.
After all the requisite approvals have been obtained, the relevant Unlisted Shares will be
withdrawn from the Unlisted Share register, and our Company will re-register such Shares on
the H Share register maintained in Hong Kong and instruct the H Share Registrar to issue H
Share certificates. Registration on the H Share register of our Company will be on the
conditions that (i) the H Share Registrar lodges with the Stock Exchange a letter confirming
the entry of the relevant H Shares on the H Share register and the due dispatch of H Share
certificates; and (ii) the admission of the H Shares to be traded on the Stock Exchange complies
with the Listing Rules and the General Rules of CCASS and the CCASS Operational
Procedures in force from time to time. Until the converted Shares are re-registered on the H
Share register of our Company, such Shares would not be listed as H Shares.
The Company has applied for the Conversion of Unlisted Shares into H Shares, which
involves 117,897,830 Unlisted Shares held by 15 Shareholders upon completion of the Share
Split. For further details, please refer to the paragraph headed “History, Development and
Corporate Structure — Shareholding Structure of our Company” in this prospectus.
RESTRICTIONS OF SHARE TRANSFER
In accordance with the PRC Company Law, the shares issued prior to any public offering
of shares by a company cannot be transferred within one year from the date on which such
publicly offered shares are listed and traded on the relevant stock exchange. As such, the
Shares issued by our Company prior to the issue of H Shares will be subject to such statutory
restriction on transfer within a period of one year from the Listing Date.
SHARE CAPITAL
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Our Directors, Supervisors and members of the senior management of our Company shall
declare their shareholdings in our Company and any changes in their shareholdings. Shares
transferred by our Directors, Supervisors and members of the senior management each year
during their term of office shall not exceed 25% of their total respective shareholdings in our
Company. The Shares that the aforementioned persons held in our Company cannot be
transferred within one year from the date on which the shares are listed and traded, nor within
half a year after they leave their positions in our Company. The Articles of Association may
contain other restrictions on the transfer of the Shares held by our Directors, Supervisors and
members of senior management of our Company.
For details of the lock-up undertaking given by our Controlling Shareholders pursuant to
Rule 10.07 of the Listing Rules, please refer to the paragraph headed “Underwriting —
Underwriting Arrangements and Expenses — Hong Kong Public Offering — Undertakings to
the Stock Exchange pursuant to the Listing Rules — Undertakings by our Controlling
Shareholders” in this prospectus.
SHAREHOLDERS’ MEETINGS
For details of circumstances under which Shareholders’ meeting are required, please refer
to the paragraph headed “Appendix V — Summary of the Articles of Association” in this
prospectus.
REGISTRATION OF SHARES NOT LISTED ON AN OVERSEAS STOCK EXCHANGE
According to the Notice of Centralized Registration and Deposit of Non-overseas Listed
Shares of Companies Listed on an Overseas Stock Exchange (ྤ̮ɪ̹
) issued by the CSRC, our Company is required to
register its shares that are not listed on any overseas stock exchange with China Securities
Depository and Clearing Corporation Limited within 15 Business Days upon the Listing and
provide a written report to the CSRC regarding the centralized registration and deposit of our
Shares that are not listed on the overseas stock exchange as well as the offering and listing of
our H Shares.
SHARE CAPITAL
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You should read the following discussion and analysis in conjunction with our
audited consolidated financial information, included in the Accountants’ Report in
Appendix I to this prospectus, together with the respective accompanying notes. Our
consolidated financial information has been prepared in accordance with HKFRSs.
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 our assumptions and
analysis made by us in light of our experience and perception of historical trends, current
conditions and expected future developments, as well as other factors we believe are
appropriate under the circumstances. However , our actual results may differ materially
from those anticipated in these forward-looking statements as a result of certain factors.
In evaluating our business, you should carefully consider the information provided in the
section headed “Risk Factors” in this prospectus.
OVERVIEW
We are an innovative biotech company, with in-house expertise and experience in
structural biology, translational medicine and clinical development. Guided by our mission and
vision, we are committed to exploring the next-generation immunotherapeutics through
discovery, development and commercialization of products for precision therapies in cancers
and autoimmune diseases, aiming at unmet medical needs in global market, and thus ultimately
to help patients around the world.
Prior to the Track Record Period, we developed HX008, which was transferred to Lepu
and later commercialized in 2022. During the Track Record, we have developed 10 product
candidates, including our Core Product, HX009, and two Key Products, HX301 and HX044.
Our pipeline development strategy hinges on a meticulous approach that prioritizes validated
targets and biological pathways, which is supported by translational evidence and clinical
feasibility to address significant unmet medical needs with substantial clinical benefits.
Under the equity transfer arrangements of HX008, we received a one-off cash payment of
RMB350.0 million and annual royalty fee of 4.375% of the annual net sales revenue of HX008
from its commercialization, which amounted to approximately RMB0.7 million and RMB4.4
million for 2022 and 2023, respectively. For details, please refer to “Business — Collaboration
Agreements — HX008 Equity Transfer Agreement” in this prospectus. Except for HX008,
which has been transferred to Lepu prior to the Track Record Period, we currently have no
products approved for commercial sale and have not generated any revenue from product sales.
We have not been profitable and have incurred operating losses during the Track Record
Period. For the years ended December 31, 2023 and 2024 and the eight months ended August
31, 2024 and 2025, we had total comprehensive loss of RMB85.1 million, RMB116.9 million,
RMB48.4 million and RMB87.4 million, respectively. Our total comprehensive loss mainly
resulted from research and development costs and administrative expenses.
FINANCIAL INFORMATION
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We expect to incur an increased amount of operating expenses for the next several years
as we further our preclinical research, continue the clinical development of, and seek
regulatory approval for our drug candidates, launch our pipeline products, and recruit
personnel necessary for operation of our business. We expect that our financial performance
will fluctuate from period to period due to the development status of our drug candidates,
timeline and terms of potential collaboration with our partners, regulatory approval timeline
and commercialization of our drug candidates.
BASIS OF PREPARATION
The historical financial information has been prepared in accordance with Hong Kong
Financial Reporting Standards (“ HKFRSs ”), which include all Hong Kong financial reporting
standards, Hong Kong Accounting Standards and Interpretations issued by the Hong Kong
Institute of Certified Public Accountants and accounting principles generally accepted in Hong
Kong. All HKFRSs effective for the accounting period commencing from January 1, 2024
together with the relevant transitional provisions, have been early adopted by the Group in the
preparation of the historical financial information throughout the Track Record Period. The
historical financial information has been prepared under the historical cost convention, except
for certain financial instruments which have been measured at fair value at the end of each
period of the Track Record Period.
MATERIAL ACCOUNTING POLICIES AND SIGNIFICANT ACCOUNTING
JUDGMENTS 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. We set
out below some of the accounting policies and estimates that we believe are of critical
importance to us or involve the most significant estimates and judgments used in the
preparation of our financial statements. Our material accounting policy information, judgments
and estimates, which are important for understanding our financial condition and results of
operations, are set out in further details in Note 2.3 and Note 3 to the Accountants’ Report in
Appendix I to this prospectus.
Significant accounting judgments and estimates are those that are most important to the
portrayal of our financial conditions and results of operations and require our management to
make judgments, estimates and assumptions that affect the reported amounts of revenues,
expenses, assets and liabilities and their accompanying disclosures and the disclosure of
contingent liabilities during the Track Record Period, often as a result of the need to make
estimates about the effect of matters that are inherently uncertain and may change in
subsequent periods.
FINANCIAL INFORMATION
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We continually evaluate these estimates based on our own historical experience,
knowledge and assessment of current business and other conditions, our expectations regarding
the future based on available information and our best assumptions, which together form our
basis for making judgments about matters that are not readily apparent from other sources.
Since the use of estimates is an integral component of the financial reporting process, our
actual results could differ from those estimates and expectations. Some of our accounting
policies require a higher degree of judgment than others in their application. We believe the
following material accounting policy information involve the most critical judgments and
estimates used in the preparation of our financial statements.
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 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.
Fair value measurement
The Group measures certain financial instruments at fair value at the end of each of the
Relevant Periods. 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.
FINANCIAL INFORMATION
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All assets and liabilities for which fair value is measured or disclosed in the financial
statements 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
For assets and liabilities that are recognised in the Historical Financial Information on a
recurring basis, the Group determines whether transfers have occurred between levels in the
hierarchy by reassessing categorisation (based on the lowest level input that is significant to
the fair value measurement as a whole) at the end of each of the Relevant Periods.
Redemption liabilities
For the redeemable ordinary shares issued by the Company and a subsidiary of the
Company as detailed in Note 24 to the Accountants’ Report in Appendix I to this prospectus,
financial liabilities are recognized based on the amortised cost of the redemption amount and
debited in equity. Changes of the amortised cost during the Relevant Periods are recognized in
profit or loss. When the redemption rights related to the redeemable ordinary shares are
terminated, the redemption liabilities on ordinary shares are extinguished and credited to
equity.
Other income
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 a share option scheme and a restricted stock scheme. 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 for grants is measured
by reference to the fair value at the date at which they are granted. The fair value of the share
option is determined by an external valuer by using binomial model and the fair value of the
FINANCIAL INFORMATION
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restricted stock is determined by an external valuer by using the discounted cash flow method,
back-solve method and equity allocation based on the option pricing model. Further details of
which are given in Note 27 to the Accountants’ Report in Appendix I to this prospectus.
The cost of equity-settled transactions is recognised in employee benefit expense,
together with a corresponding increase in equity, 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 reporting period 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 the statement of 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. Market performance conditions are reflected within the grant date fair value.
Any other conditions attached to an award, but without an associated service requirement, are
considered to be non-vesting conditions. 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.
Material Accounting Judgments and Estimate
Research and development costs
All research costs are charged to profit or loss as incurred. Costs incurred on each pipeline
to develop new products are capitalised and deferred in accordance with the accounting policy
for research and development costs in Note 2.3 to the Accountants’ Report in Appendix I to this
FINANCIAL INFORMATION
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prospectus. Determining the amounts to be capitalised requires management to make
judgments on the technical feasibility of existing pipelines to be successfully commercialised
and bring economic benefits to the Group.
Fair value of variable consideration arising from disposal of an associate
The fair value of variable consideration arising from disposal of an associate measured at
FVTPL is determined using valuation techniques, including the discounted cash flow method.
Such valuation requires the Group to make estimates of the key assumptions including the
discount rate, which are subject to uncertainty.
The fair values of variable consideration arising from disposal of an associate as at
December 31, 2023, 2024 and August 31, 2025 were approximately RMB249.3 million,
RMB246.4 million and RMB222.2 million, respectively. Further details are included in Note
19 to the Accountants’ Report in Appendix I to this prospectus.
Fair value of share-based payments transactions
Estimating the fair value of share-based payments transactions requires the determination
of the most appropriate valuation model, which depends on the terms and conditions of the
grant. This estimate also requires the determination of the most appropriate inputs to the
valuation model including the expected life of the share option, volatility and dividend yield
and making assumptions about them.
For the measurement of the fair value of share-based payments transactions with
employees at the grant date, the Group uses binomial model and back-solve method. The
assumptions and models used for estimating fair value for share-based payments transactions
are disclosed in Note 27 to the Accountants’ Report in Appendix I to this prospectus.
MAJOR 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.
Development and Commercialization of Our Drug Candidates
Our business and results of operations will be dependent on our receipt of regulatory
approval for and successful commercialization of our drug candidates. As of the Latest
Practicable Date, we have established a pipeline of 10 drug candidates, including three in
clinical stage and multiple in discovery and seven in preclinical stage. For details on the
development status of our drug candidates, please refer to “Business — Our Product Pipeline”.
FINANCIAL INFORMATION
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Our product candidates have not been approved for commercialization and no revenue has
been generated from sales of such product candidates. Our business and results of operations
depend on our ability to continuously advance preclinical and clinical development of, and
obtain the requisite regulatory approvals for, our drug candidates. Once our drug candidates are
commercialized, our business and results of operations will be driven by the market acceptance
and supply of our commercialized drugs. To successfully develop and launch our drug
candidates, we intend to advance clinical development of our product pipeline, continue
exploring combination therapies for our product pipeline, enhance our research and
development capabilities, upgrade our existing platform and build new platforms for new
modality drugs, enhance business development and strengthen global partnerships, continue to
build up an internal clinical development team and attract and retain talents to fuel our
expansion. For details, please refer to “Business — Our Strategies” in this prospectus.
Our Cost Structure
Our results of operations are significantly affected by our cost structure, which primarily
consists of research and development costs and administrative expenses.
Research and development costs have been and are expected to continue to be a major
component in our cost structure. During the Track Record Period, our research and
development costs primarily consisted of (i) labor expenses; (ii) clinical expenses; (iii)
technical service expenses; (iv) testing expenses; (v) material consumption expenses; (vi)
depreciation and amortization expenses; (vii) consulting service expenses; and (viii) others.
For details, please refer to “— Description of Selected Components of Consolidated Statements
of Profit or Loss and Other Comprehensive Income — Research and Development Costs” in
this section. Our research and development costs amounted to RMB46.7 million, RMB74.7
million, RMB50.5 million and RMB56.2 million for the years ended December 31, 2023 and
2024 and the eight months ended August 31, 2024 and 2025, respectively.
During the Track Record Period, our administrative expenses primarily included (i)
professional service expenses; (ii) employee remuneration expenses; (iii) rental expenses; (iv)
office expenses; (v) business reception expenses; (vi) depreciation expenses; (vii) travel
expenses; (viii) amortization expenses; and (ix) other expenses. For details, please refer to “—
Description of Selected Components of Consolidated Statements of Profit or Loss and Other
Comprehensive Income — Administrative Expenses” in this section. Our administrative
expenses amounted to RMB17.2 million, RMB46.2 million, RMB16.1 million and RMB27.4
million for the years ended December 31, 2023 and 2024 and the eight months ended August
31, 2024 and 2025, respectively.
We expect our cost structure to evolve as we continue to develop and expand our business.
As the preclinical studies and clinical trials of our drug candidates continue to progress, we
expect to incur additional costs in relation to, among other things, preclinical study and clinical
trial expenses, raw materials procurements, manufacturing and sales and marketing.
Additionally, we anticipate increasing legal, compliance, accounting, insurance and investor
and public relations expenses associated with being 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 primarily through funds from
transfer of our equity interests in Taizhou Hanzhong and Pre-IPO Investments. Going forward,
in the event of successful commercialization of one or more of our drug candidates, we expect
to fund our operations in part with cash on hand as well as funds generated from licensing
arrangements. However, with the continuing expansion of our business, we may require further
funding through public or private offerings, debt financings, collaboration arrangements or
other sources. Any fluctuation in the funding for our operations will impact our cash flow plan
and our results of operations.
DESCRIPTION OF SELECTED COMPONENTS OF CONSOLIDATED STATEMENTS
OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
The following table sets forth selected components of our consolidated statements of
profit or loss and other comprehensive income for the periods indicated:
For the Y ear
Ended December 31
For the Eight Months
Ended August 31
2023 2024 2024 2025
(in thousands of RMB)
(unaudited)
Other income and gains /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,664 7,681 12,313 2,626
Research and development costs /H1118/H1118(46,663) (74,721) (50,523) (56,178)
Administrative expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(17,220) (46,192) (16,116) (27,436)
Other expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(33,924) (209) (238) (11,413)
Interest expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(2,280) (9,379) (5,853) (7,532)
Profit/(Loss) before tax /H1118/H1118/H1118/H1118/H1118/H1118/H1118(93,423) (122,820) (60,417) (99,933)
Income tax expense /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188,263 5,898 11,997 12,495
Loss for the year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118(85,160) (116,922) (48,420) (87,438)
Other comprehensive income/(loss)
for the year/period net of tax /H1118/H1118/H1118537 60 242 (423)
Total comprehensive loss for the
year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(84,623) (116,862) (48,178) (87,861)
FINANCIAL INFORMATION
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Other Income and Gains
During the Track Record Period, our other income and gains consisted of (i) fair value
gains on financial assets at fair value through profit or loss (“FVTPL”); (ii) government grant
by local governments mainly to support for the Group’s research and development activities
and business operation; (iii) interest income from structured deposits and wealth management
products; and (iv) bank interest income; The fair value gains on FVTPL represent variable
consideration of equity interests transfer in Taizhou Hanzhong to Lepu. The government grants
mainly represent various financial supports awarded by the local governments to support our
Group’s research and development expenditures and business operation. There are no
contingencies relating to these grants. Our bank interest income mainly generated from
seven-day notice deposits of approximately RMB70.0 million and a three-year time deposit of
RMB20.0 million with a maturity date on December 22, 2026. Our interest income from
structured deposits and wealth management products mainly represents income from bank-
issued asset management products.
The following table summarizes a breakdown of our other income and gains for the
periods indicated:
For the Y ear Ended December 31
For the Eight Months Ended
August 31
2023 2024 2024 2025
(RMB’000) % (RMB’000) % (RMB’000) % (RMB’000) %
(unaudited)
Fair value gains on
FVTPL /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 1,615 21.0 10,689 86.9 – –
Bank interest income /H11181,867 28.0 1,618 21.1 350 2.8 171 6.5
Interest income from
FVTPL /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,258 33.9 1,306 17.0 917 7.4 156 5.9
Government grant /H1118/H1118/H11182,539 38.1 2,199 28.6 231 1.9 75 2.9
Foreign exchange
gains, net /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 943 12.3 126 1.0 364 13.9
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – – – – 1,860 70.8
Total other income
and gains /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,664 100.0 7,681 100.0 12,313 100.0 2,626 100.0
FINANCIAL INFORMATION
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Research and Development Costs
During the Track Record Period, our research and development costs consisted of (i) labor
expenses; (ii) clinical expenses; (iii) technical service expenses; (iv) testing expenses; (v)
material consumption expenses; (vi) depreciation and amortization expenses; (vii) consulting
service expenses; and (viii) others. During the Track Record Period, our research and
development costs were mainly incurred for the clinical trials of our Core Product, preclinical
studies of HX044 and HX111, and engagement of third-party manufacturer to produce clinical
test reagent for HX301.
The following table below sets forth a breakdown of our research and development costs
for the periods indicated:
For the Y ear Ended December 31
For the Eight Months Ended
August 31
2023 2024 2024 2025
(RMB’000) % (RMB’000) % (RMB’000) % (RMB’000) %
(unaudited)
Technical service
expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11187,393 15.8 22,605 30.3 15,376 30.4 20,885 37.1
Labor expenses /H1118/H1118/H1118/H1118/H111828,179 60.3 24,346 32.5 17,433 34.5 18,998 33.8
Clinical expenses /H1118/H1118/H1118/H11183,115 6.7 6,148 8.2 3,667 7.3 6,779 12.1
Material consumption
expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,509 5.4 4,980 6.7 4,719 9.3 4,486 8.0
Consulting service
expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,062 2.3 786 1.1 26 0.1 564 1.0
Testing expenses /H1118/H1118/H1118/H11181,760 3.7 11,200 15.0 5,476 10.8 2,025 3.6
Depreciation and
amortization
expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118787 1.7 1,952 2.6 1,314 2.6 1,284 2.3
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,858 4.0 2,704 3.6 2,512 5.0 1,157 2.1
Total research and
development costs /H111846,663 100.0 74,721 100.0 50,523 100.0 56,178 100.0
FINANCIAL INFORMATION
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The following table below sets forth a breakdown of our research and development costs
by development stage incurred for each clinical program for the periods indicated:
For the Y ear Ended December 31
For the Eight Months Ended
August 31
2023 2024 2024 2025
(RMB’000) % (RMB’000) % (RMB’000) % (RMB’000) %
(unaudited)
HX009 HX009 Preclinical Studies /H1118/H1118/H1118/H1118/H1118/H11182,941 6.3 6,722 12.5 5,658 14.2 6,612 14.7
HX009-I-01 China Study /H1118/H1118/H1118/H1118/H1118/H11183,223 6.8 7,275 13.4 5,987 15.0 7,103 15.9
HX009-I-03 China Study (1) /H1118/H1118/H1118/H1118/H1118– – 47 0.1 47 0.1 – –
HX009-II-02 China Study /H1118/H1118/H1118/H1118/H1118/H11187,131 15.3 3,318 6.1 2,994 7.5 1,345 3.0
HX009-II-04 China Study /H1118/H1118/H1118/H1118/H1118/H1118–– –– –– 3 4 0 0 . 6
HX009-II-03 U.S. Study (1) /H1118/H1118/H1118/H1118/H1118/H11189 1 0 . 2 –– –– ––
HX009-II-06 China Study /H1118/H1118/H1118/H1118/H1118/H1118–– –– –– 3 9 0 . 1
HX009-II-05 China Study /H1118/H1118/H1118/H1118/H1118/H1118– – 510 0.9 281 0.7 2,170 4.8
HX009 Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118119 0.3 1,484 2.7 208 0.5 16 0.0
Subtotal /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111813,505 28.9 19,356 35.7 15,175 38.0 17,625 39.1
HX301 HX301 Preclinical Studies /H1118/H1118/H1118/H1118/H1118/H11182,275 4.9 995 1.9 501 1.3 106 0.2
HX301-I-01 China Study /H1118/H1118/H1118/H1118/H1118/H11181,928 4.1 811 1.5 778 1.9 546 1.2
HX301-I-02 China Study (1) /H1118/H1118/H1118/H1118/H1118158 0.3 20 0.0 – – – –
HX301-I-03 China Study (1) /H1118/H1118/H1118/H1118/H1118308 0.7 174 0.3 537 1.3 397 0.9
HX301-II-01 China Study /H1118/H1118/H1118/H1118/H1118/H1118– – 27 0.0 357 0.9 1,030 2.3
HX301 Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111845 0.1 648 1.2 195 0.5 – –
Subtotal /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,714 10.1 2,675 4.9 2,368 5.9 2,079 4.6
HX044 HX044 Preclinical Studies /H1118/H1118/H1118/H1118/H1118/H11183,834 8.2 15,302 28.2 12,282 30.8 6,043 13.4
HX044-I-01 China Study /H1118/H1118/H1118/H1118/H1118/H1118– – 1,065 2.0 904 2.3 2,531 5.6
Subtotal /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,834 8.2 16,367 30.2 13,186 33.1 8,574 19.0
Others (2) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11187,238 15.5 5,858 10.8 2,744 6.9 7,161 15.9
Labor cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111817,372 37.2 9,948 18.4 6,426 16.1 9,654 21.4
Total research and development costs /H1118/H1118/H1118/H1118/H111846,663 100.0 54,204 100.0 39,899 100.0 45,093 100.0
Notes:
(1) We have done preliminary work and incurred research and development expenses for these clinical studies. As
of the Latest Practicable Date, these clinical studies have not yet commenced and was not currently under
preparation.
(2) Including, among others, research and development costs for preclinical studies of HX111.
FINANCIAL INFORMATION
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--- page 485 ---
The table below sets forth a breakdown of our research and development costs incurred
on the Core Product for the periods indicated:
For the Y ear
Ended December 31
For the Eight Months
Ended August 31
2023 2024 2024 2025
(in thousands of RMB)
(unaudited)
Technical service expenses /H1118/H1118/H1118/H1118/H1118/H11182,885 8,369 6,561 4,034
Labor expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,956 1,141 895 3,367
Clinical expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,917 7,753 6,078 5,982
Material consumption expenses /H1118/H1118/H111866 913 716 2,991
Testing expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118863 330 259 108
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118818 850 666 1,143
Total R&D costs incurred for Core
Product /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111813,505 19,356 15,175 17,625
During the Track Record Period, all our research and development costs were expensed
and not capitalized. We expect our research and development costs to grow along with
advancement of our clinical programs and continued research and development of our
preclinical and future drug candidates.
Administrative Expenses
During the Track Record Period, our administrative expenses consisted of (i) employee
remuneration expenses; (ii) professional service expenses; (iii) rental expenses; (iv) office
expenses; (v) business reception expenses; (vi) depreciation expenses; (vii) travel expenses;
(viii) amortization expenses; and (ix) other expenses. From 2023 to 2024, our administrative
expenses increased significantly, which is generally in line with our business and financing
operations.
FINANCIAL INFORMATION
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--- page 486 ---
The following table summarizes a breakdown of our administrative expenses for the
periods indicated:
For the Y ear Ended December 31
For the Eight Months Ended
August 31
2023 2024 2024 2025
(RMB’000) % (RMB’000) % (RMB’000) % (RMB’000) %
(unaudited)
Employee
remuneration
expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188,810 51.1 26,397 57.3 6,902 42.8 17,522 63.9
Listing expense /H1118/H1118/H1118/H1118/H1118– – 10,736 23.2 3,934 24.4 2,976 10.9
Depreciation
expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118219 1.3 3,416 7.4 2,309 14.3 2,635 9.6
Professional service
expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,961 34.6 3,622 7.8 1,786 11.1 2,151 7.8
Business reception
expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118362 2.1 153 0.3 107 0.7 109 0.4
Rental expense /H1118/H1118/H1118/H1118/H1118789 4.6 56 0.1 111 0.7 503 1.8
Travel expenses /H1118/H1118/H1118/H1118/H1118186 1.1 163 0.4 19 0.1 182 0.7
Office expenses /H1118/H1118/H1118/H1118/H1118293 1.7 694 1.5 254 1.6 554 2.0
Amortization
expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111833 0.2 111 0.2 – 0.0 88 0.3
Other expenses /H1118/H1118/H1118/H1118/H1118567 3.3 844 1.8 694 4.3 716 2.6
Total administrative
expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111817,220 100.0 46,192 100.0 16,116 100.0 27,436 100.0
Other Expenses
During the Track Record Period, we incurred other expenses of RMB33.9 million,
RMB209,000, RMB238,000 and RMB11.4 million for the years ended December 31, 2023 and
2024 and the eight months ended August 31, 2024 and 2025, respectively, primarily consist of
the fair value losses for the variable consideration resulted from disposal of our equity interest
in Taizhou Hanzhong to Lepu.
Interest Expenses
During the Track Record Period, our interest expenses were primarily resulted from
interests on redemption liabilities and lease liabilities of our newly-rented laboratory and office
premises in Wuhan for our daily business operation, which amounted to RMB2.3 million,
RMB9.4 million, RMB5.9 million and RMB7.5 million for the years ended December 31, 2023
and 2024 and the eight months ended August 31, 2024 and 2025, respectively.
FINANCIAL INFORMATION
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Income Tax Expense
Income tax expense represents the sum of the tax currently payable and deferred tax.
During the Track Record Period, we incurred income tax expenses of RMB8.3 million and
RMB5.9 million in 2023 and 2024, and we recorded income tax credit of RMB12.0 million and
income tax expense of RMB12.5 million for the eight months ended August 31, 2024 and 2025,
respectively, primarily resulted from recognition of deferred tax for the equity payment made
during the Track Record Period due to disposal of our equity interest in Taizhou Hanzhong to
Lepu.
Pursuant to the corporate income tax law, the basic tax rate of our subsidiaries operating
in the PRC is at a rate of 25% on the taxable income during the Track Record Period. An
additional 100% of qualified research and development expenses incurred is allowed to be
deducted from taxable income effective from October 1, 2022.
Our subsidiaries incorporated in Hong Kong are subject to income tax at a rate of 16.5%
on the estimated assessable profits arising in Hong Kong during the Track Record Period. Our
subsidiary incorporated in Australia is subject to Australia company tax at a statutory rate of
25% on the estimated assessable profits arising in Australia during the Track Record Period.
No Australia company tax was provided for as the subsidiary did not generate any assessable
profits arising in Australia during the Track Record Period. The subsidiary incorporated in
Delaware, USA, is subject to statutory United States federal corporate income tax at a rate of
21%. It is also subject to the state income tax at rates from 8.25% to 11.5% during the Track
Record Period.
Our Directors confirm that during the Track Record Period, we had made all the required
tax filings and had paid all outstanding tax liabilities with the applicable tax authorities, and
we are not aware of any outstanding or potential disputes with such tax authorities.
PERIOD TO PERIOD COMPARISON OF RESULTS OF OPERATIONS
The Eight Months Ended August 31, 2025 Compared to the Eight Months ended August
31, 2024
Other Income and Gains
Our other income and gains decreased significantly by 78.7% from RMB12.3 million for
the eight months ended August 31, 2024 to RMB2.6 million for the eight months ended August
31, 2025. The decrease was primarily because no fair value gains on FVTPL for the variable
consideration resulted from disposal of our equity interest in Taizhou Hanzhong was
recognized in 2025.
FINANCIAL INFORMATION
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--- page 488 ---
Research and Development Costs
Research and development costs increased by 11.2% from RMB50.5 million for the eight
months ended August 31, 2024 to RMB56.2 million for the eight months ended August 31,
2025. The increase was mainly attributable to (i) an increase of RMB5.5 million in technical
service expenses primarily resulted from increased CMC costs for clinical trials of HX009,
HX044 and HX111; (ii) an increase of RMB0.7 million in labor expenses resulted from the
increase in average salaries and headcount of our R&D personnel; and (iii) an increase of
RMB0.7 million from the share incentives granted in the second half of 2024, part of which
was recognized in 2025.
Administrative Expenses
Administrative expenses increased by 70.2% from RMB16.1 million for the eight months
ended August 31, 2024 to RMB27.4 million for the eight months ended August 31, 2025,
mainly attributable to the increase of RMB2.7 million in employee remuneration expenses,
mainly due to salary and social insurance contributions of senior management that joined in
August 2024.
Other Expenses
Other expenses increased by RMB11.2 million from RMB0.2 for the eight months ended
August 31, 2024 to RMB11.4 million for the eight months ended August 31, 2025, which was
mainly attributable to fair value losses on FVTPL for the variable consideration resulted from
disposal of our equity interest in Taizhou Hanzhong to Lepu.
Interest Expenses
Interest expenses increased by 28.7% from RMB5.9 million for the eight months ended
August 31, 2024 to RMB7.5 million for the eight months ended August 31, 2025, mainly
attributable to an increase of RMB1.7 million in interest expensed on redemption liabilities
resulted from Pre-IPO Investment.
Income Tax Expenses
We incurred income tax expense of RMB12.5 million for the eight months ended August
31, 2025, while we recorded income tax credit of RMB12.0 million for the eight months ended
August 31, 2024, primarily due to the increase of RMB2.7 million in deferred tax resulted from
fluctuation of the variable consideration arising from disposal of our equity interest in Taizhou
Hanzhong to Lepu.
FINANCIAL INFORMATION
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--- page 489 ---
Loss for the Period
As a result of the foregoing, our loss for the period increased by RMB39.0 million from
RMB48.4 million for the eight months ended August 31, 2024 to RMB87.4 million for the eight
months ended August 31, 2025.
The Y ear Ended December 31, 2024 Compared to the Y ear Ended December 31, 2023
Other Income and Gains
Our other income and gains increased by 15.3% from RMB6.7 million for the year ended
December 31, 2023 to RMB7.7 million for the year ended December 31, 2024. The increased
amount was primarily attributable to the fair value gains on FVTPL for the variable
consideration resulted from disposal of our equity interest in Taizhou Hanzhong to Lepu.
Research and Development Costs
Research and development costs increased by 60.1% from RMB46.7 million for the year
ended December 31, 2023 to RMB74.7 million for the year ended December 31, 2024. The
increase was mainly attributable to (i) an increase of RMB15.2 million in technical service
expenses primarily resulted from increased CMC costs for clinical trials of HX009, HX044,
HX301 and HX111; (ii) an increase of RMB9.4 million in testing expenses for preclinical
toxicology tests of HX044 and HX111; and (iii) an increase of RMB2.5 million in material
consumption expenses due to increased material procurements from our suppliers, including
active pharmaceutical ingredients for HX301 and raw materials for HX044 and HX111.
Administrative Expenses
Administrative expenses increased by 168.2% from RMB17.2 million for the year ended
December 31, 2023 to RMB46.2 million for the year ended December 31, 2024, mainly
attributable to the increase in (i) listing expenses of RMB10.7 million incurred in 2024; (ii)
employee remuneration expenses of RMB4.3 million resulted mainly from the increment of
salaries and number of employees for our business operation; (iii) employee remuneration
expenses of RMB13.2 million, arising from increases in the number and value of share
incentives granted in 2024 and (iv) depreciation expenses of RMB1.8 million due to
depreciation of right-of-use assets in relation to leased properties.
Other Expenses
Other expenses decrease by RMB33.7 million from RMB33.9 million for the year ended
December 31, 2023 to RMB209,000 for the year ended December 31, 2024, which was mainly
attributable to fair value losses on FVTPL for the variable consideration resulted from disposal
of our equity interest in Taizhou Hanzhong to Lepu.
FINANCIAL INFORMATION
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--- page 490 ---
Interest Expenses
Interest expenses increased by RMB7.1 million from RMB2.3 million for the year ended
December 31, 2023 to RMB9.4 million for the year ended December 31, 2024, mainly
attributable to an increase of RMB6.6 million in interest expensed on redemption liabilities
resulted from Pre-IPO Investment and RMB0.5 million in interest expenses on lease liabilities
of our newly-rented laboratory and office premises in Wuhan for the purpose of our daily
business operations.
Income Tax Expenses
We incurred negative income tax expenses for the year ended December 31, 2023 and
2024 of RMB8.3 million and RMB5.9 million, mainly attributable to the recognition of
deferred tax for the equity payment made during the Track Record Period resulted from
disposal of our equity interest in Taizhou Hanzhong to Lepu.
Loss for the Y ear
As a result of the foregoing, our loss for the year increased by RMB31.8 million from
RMB85.2 million for the year ended December 31, 2023 to RMB116.9 million for the year
ended December 31, 2024.
DISCUSSION OF CERTAIN SELECTED ITEMS FROM THE CONSOLIDATED
STATEMENTS OF FINANCIAL POSITION
The following table sets forth selected information from our consolidated statements of
financial position as of the dates indicated:
As of December 31
As of
August 31
As of
October 31,
2023 2024 2025 2025
(in thousands of RMB)
(unaudited)
Non-current assets
Property, plant and equipment /H1118/H1118/H11188,340 11,820 11,907 11,677
Right-of-use assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111815,661 12,309 10,525 10,245
Other intangible assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118558 447 587 581
Prepayments, other receivables
and other assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118531 330 330 330
Financial assets at fair value
through profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118242,373 233,778 210,100 210,100
Long-term time deposits at banks /H111820,01 6–––
Total non-current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118287,479 258,684 233,449 232,933
FINANCIAL INFORMATION
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As of December 31
As of
August 31
As of
October 31,
2023 2024 2025 2025
(in thousands of RMB)
(unaudited)
Current assets
Prepayments, other receivables
and other assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111893,900 68,908 38,012 37,321
Financial assets at fair value
through profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111842,361 12,665 22,837 22,837
Pledged deposits /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185 0 0–––
Cash and cash equivalents /H1118/H1118/H1118/H1118/H1118/H1118162,000 161,214 150,000 132,926
Total current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118298,761 242,787 210,849 193,084
Current liabilities
Trade payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111812,936 12,293 16,225 18,485
Other payables and accruals /H1118/H1118/H1118/H1118/H111839,667 42,433 10,492 10,416
Lease liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,201 3,169 3,509 3,517
Tax payable /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11187,069 7,981 7,373 6,564
Redemption liabilities on ordinary
shares /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 131,564 138,481 139,359
Interest-bearing bank borrowings /H1118 – – 50,000 42,000
Total current liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111862,873 197,440 226,080 220,341
Net current assets/(liabilities) /H1118/H1118235,888 45,347 (15,231) (27,257)
Non-current liabilities
Deferred tax liability /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111890,468 78,765 66,270 66,270
Lease liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111811,830 8,662 7,157 6,214
Redemption liability on ordinary
shares /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118101,48 8–––
Interest-bearing bank and other
borrowings /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 8,000
Total non-current liabilities /H1118/H1118/H1118/H1118203,786 87,427 73,427 80,484
Net assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118319,581 216,604 144,791 125,192
FINANCIAL INFORMATION
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As of December 31
As of
August 31
As of
October 31,
2023 2024 2025 2025
(in thousands of RMB)
(unaudited)
Equity attributable to owners of
the parent
Paid-in capital /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189,525 11,790 11,790 11,790
Reserves /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118258,603 154,449 86,018 66,869
Non-controlling interests /H1118/H1118/H1118/H1118/H1118/H111851,453 50,365 46,983 46,533
Total equity /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118319,581 216,604 144,791 125,192
Property, Plant and Equipment
Our property, plant and equipment primarily consisted of (i) leasehold improvements; (ii)
plant and machinery; (iii) furniture and fixtures; (iv) motor vehicles; and (v) construction in
progress. Our property, plant and equipment increased from RMB8.3 million as of
December 31, 2023 to RMB11.8 million as of December 31, 2024, primarily due to an increase
in office renovation expenses incurred for our newly-rented laboratory and office premises in
Wuhan. Our property, plant and equipment further increased from RMB11.8 million as of
December 31, 2024 to RMB11.9 million as of August 31, 2025, primarily due to the increase
in office construction and certain newly added furniture and fixtures.
As of December 31, 2023 and 2024 and August 31, 2025, no indicators of the impairment
for our non-financial assets were identified because (i) our non-financial assets were not obsolete
of physically damage, and (ii) our actual losses for the years ended December 31, 2023 and 2024
and the eight months ended August 31, 2025 did not exceed the estimated losses.
The following table sets forth our property and equipment as of the dates indicated:
As of December 31
As of
August 31
2023 2024 2025
(in thousands of RMB)
Leasehold improvements /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 6,743 8,750
Plant and machinery /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,761 2,261 1,993
Furniture and fixtures /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118160 144 498
Motor vehicles /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111814 14 14
Construction in progress /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,405 2,658 652
Total property, plant and equipment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188,340 11,820 11,907
FINANCIAL INFORMATION
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Right-of-use Assets
Our right-of-use assets primarily arose from rental expenses. Our right-of-use assets
decreased from RMB15.7 million as of December 31, 2023 to RMB12.3 million as of
December 31, 2024 and further decreased to RMB10.5 million as of August 31, 2025, primarily
due to the amortization of rental expenses and rental payments.
Other Intangible Assets
Our other intangible assets primarily arose from our software. Our other intangible assets
decreased from RMB558,000 as of December 31, 2023, to RMB447,000 as of December 31,
2024, primarily due to the amortization of existing softwares. Our other intangible assets
increased from RMB447,000 as of December 31, 2024 to RMB587,000 as of August 31, 2025,
primarily due to the purchase of new software.
Long-term Time Deposits at Banks
Our long-term time deposits at banks decreased from RMB20.0 million as of December
31, 2023 to nil as of December 31, 2024 and August 31, 2025, primarily due to the redemption
for a three-year time deposits of RMB20.0 million.
Prepayments, Other Receivables and Other Assets
Our prepayments, other receivables and other assets primarily consisted of receivables
arising from disposal of an associate, prepayments, deferred listing expenses, tax recoverable,
deposits and other receivables and due from related parties.
Our prepayments, other receivables and other assets decreased from RMB94.4 million as
of December 31, 2023 to RMB69.2 million as of December 31, 2024, primarily due to the
decreased amount of receivables arising from disposal of an associate because, in September
2024, we received RMB40.0 million as the partial payment of the considerations for disposal
of our equity interest in Taizhou Hanzhong to Lepu. According to the supplement agreement
entered into between Lepu and us in August 2024, we have received the outstanding One-off
Cash Payment of RMB35.0 million as of the Latest Practicable Date. Our prepayments, other
receivables and other assets decreased from RMB69.2 million as of December 31, 2024 to
RMB38.3 million as of August 31, 2025, primarily due to the increase amount of RMB13.1
million in receivables arising from disposal of an associate, which was received as annual
royalty fee from Lepu, with the amount of RMB13.1 million.
FINANCIAL INFORMATION
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The following table sets forth our prepayments, other receivables and other assets as of
the dates indicated:
As of December 31
As of
August 31
2023 2024 2025
(in thousands of RMB)
Prepayments /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111812,172 18,541 16,894
Receivables arising from disposal of an
associate (Note) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111875,000 35,000 –
Deferred listing expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 2,684 6,710
Tax recoverable /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,522 9,761 13,650
Deposits and other receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,737 3,080 1,088
Due from related parties /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 172 –
Total prepayments, other receivables and
other assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111894,431 69,238 38,342
Note: refers to disposal of our equity interests in Taizhou Hanzhong to Lepu
As of the Latest Practicable Date, RMB6.1 million or 36.3%, of our prepayments,
deposits and other receivables as of August 31, 2025 had been subsequently settled.
Financial Assets at Fair Value through Profit or Loss
Our financial assets at fair value through profit or loss primarily included variable
consideration arising from disposal of our equity interests in Taizhou Hanzhong to Lepu and
structured deposits and wealth management products. Our non-current financial assets at fair
value through profit or loss maintained relatively stable in 2023 and 2024. Our non-current
financial assets decreased from RMB233.8 million as of December 31, 2024 to RMB210.1
million as of August 31, 2025, primarily due to the fluctuation of the variable consideration
arising from disposal of our equity interest in Taizhou Hanzhong to Lepu. Our current financial
assets at fair value through profit or loss significantly decreased from RMB42.4 million as of
December 31, 2023 to RMB12.7 million as of December 31, 2024, primarily consist of variable
consideration arising from disposal of our equity interests in Taizhou Hanzhong to Lepu. Our
current financial assets at fair value through profit or loss remained relatively stable at
RMB22.8 million as of August 31, 2025.
FINANCIAL INFORMATION
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We maintain a prudent investment policy for purchase of wealth management products,
which stipulates that prior approval from the Board is required for the purchase of single
wealth management product that amounts from 5% to 30% of the latest audited total assets; as
well as when the cumulative amount of such purchase within 12 consecutive months exceeds
10% of the latest audited total assets. In addition, our internal control policies include
disclosure policy, which stipulates that investments and purchase of material assets that meet
the requirements of Chapter 14 of the Listing Rules shall be disclosed after the Listing.
Cash and Cash Equivalents
Our cash and cash equivalents primarily include cash and bank balances and time
deposits. Our cash and cash equivalents remained relatively stable with the amount of
RMB162.0 million as of December 31, 2023 and RMB161.2 million as of December 31, 2024,
respectively. Our cash and cash equivalents decreased from RMB161.2 million as of December
31, 2024 to RMB150.0 million as of August 31, 2025, primarily due to the increased daily
operating expenses and payments for equity investment.
The following table sets forth our cash and cash equivalents as of the dates indicated:
As of December 31
As of
August 31
2023 2024 2025
(in thousands of RMB)
Cash and bank balances /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118158,150 161,214 150,000
Time deposits /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111824,366 – –
Less: Pledged deposits /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185 0 0––
Less: Long-term time deposits /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111820,016 – –
Total cash and cash equivalents /H1118/H1118/H1118/H1118/H1118/H1118162,000 161,214 150,000
Trade Payables
Our trade payables were generated from ordinary business operation with payment terms
range from within one year, one to two years, two to three years and over three years.
Our trade payables remained relatively stable with the amount of RMB12.9 million as of
December 31, 2023 and RMB12.3 million as of December 31, 2024, respectively. Our trade
payables increased from RMB12.3 million as of December 31, 2024 to RMB16.2 million as of
August 31, 2025, primarily due to (i) the increase in our research and development costs; and
(ii) the accelerated clinical progress of HX044.
FINANCIAL INFORMATION
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The following table sets forth an aging analysis of our trade payables presented based on
the invoice dates at the end of the indicated years/period:
As of December 31
As of
August 31
2023 2024 2025
(in thousands of RMB)
Within 1 year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189,735 3,450 11,158
1 to 2 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,887 7,691 4,346
2 to 3 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118312 983 552
Over 3 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182 169 169
Total trade payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111812,936 12,293 16,225
As of the Latest Practicable Date, RMB9.3 million, or 57.1%, of our trade payables as of
August 31, 2025 had been subsequently settled.
Other Payables and Accruals
Our other payables and accruals mainly included (i) payables arising from acquisition of
non-controlling interests; (ii) government grants to be recognized; (iii) payroll payable; (iv)
payables for purchase of property, plant and equipment; (v) accrued listing expenses; and (vi)
other payables. Our other payables and accruals increased from RMB39.7 million as of
December 31, 2023, to RMB42.4 million as of December 31, 2024, primarily due to the
increase of RMB2.8 million of accrued listing expenses in 2024. Our other payables and
accruals decreased significantly from RMB42.4 million as of December 31, 2024 to RMB10.5
million as of August 31, 2025, primarily due to the settlement of RMB31.2 million of the
payables arising from acquisition of non-controlling interests in Hangzhou Hanx.
As of December 31
As of
August 31
2023 2024 2025
(in thousands of RMB)
Payables arising from acquisition of
non-controlling interests /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111831,244 31,244 –
Government grants to be recognised
under certain conditions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,000 4,000 4,000
Payroll payable /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,559 2,802 2,263
Payables for purchase of property, plant
and equipment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,684 970 196
Accrued listing expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 2,758 3,776
Other payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118180 659 257
Total other payables and accruals /H1118/H1118/H1118/H1118/H111839,667 42,433 10,492
FINANCIAL INFORMATION
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Lease Liabilities
Our lease liabilities were in relation to the properties that we leased as offices for daily
business operations. Our current lease liabilities remained relatively stable as of December 31,
2023 and 2024 and August 31, 2025. Our non-current lease liabilities decreased from RMB11.8
million as of December 31, 2023 to RMB8.7 million as of December 31, 2024, primarily due
to amortization of rent payment of our laboratory and office premises in Wuhan. Our
non-current lease liabilities decreased slightly to RMB7.2 million as of August 31, 2025.
Tax Payable
Our tax payable mainly include income tax payable, which remained relatively stable
during the Track Record Period.
Redemption Liability
Our redemption liabilities increased from RMB101.5 million as of December 31, 2023 to
RMB131.6 million as of December 31, 2024, which were primarily resulted from the
redemption liabilities to Series B+ Investors. Our redemption liabilities remained relatively
stable at RMB138.5 million as of August 31, 2025.
Net Current Assets/(Liabilities)
Our net current assets decreased significantly from RMB235.9 million as of December
31, 2023 to RMB45.3 million as of December 31, 2024, which were primarily resulted from
(i) redemption liabilities on ordinary shares were reclassified from non-current to current
liabilities; and (ii) the decrease in financial assets at fair value through profit or loss, which was
in turn due to the fluctuation of the forecasted variable consideration for the disposal of
HX008. We recorded net current liabilities of RMB15.2 million as of August 31, 2025, which
was primarily due to the redemption liabilities on ordinary shares with an amount of
RMB138.5 million were recorded as current liabilities, and the redemption feature of which
will automatically ceased from the date before the completion of the Listing. Our Directors are
of the opinion that we do not expect any outflow to settle the redemption liabilities in the next
twelve months from August 31, 2025 and will have sufficient working capital to meet its
financial liabilities and obligations as and when they fall due and to sustain its operations for
the next twelve months from August 31, 2025 based on the review of our projected cash flows.
Deferred Tax Liabilities
Our deferred tax liabilities decreased from RMB90.5 million as of December 31, 2023 to
RMB78.8 million as of December 31, 2024, and further decreased to RMB66.3 million as of
August 31, 2025, which were primarily due to the timing difference of recognition for the
equity payment made during the Track Record Period regarding the equity disposal of Taizhou
Hanzhong to Lepu.
FINANCIAL INFORMATION
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KEY FINANCIAL RATIOS
The table below sets forth our key financial ratios as of the dates indicated:
As of December 31
As of
August 31
2023 2024 2025
Current ratio (Note) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184.75 1.23 0.93
Note: Current ratio represents current assets divided by current liabilities as of the same date.
Our current ratio decreased from 4.75 as of December 31, 2023 to 1.23 as of December
31, 2024, primarily due to the reclassification of redemption liabilities to Series B+ investors
on ordinary shares from non-current liabilities to current liabilities based on the recognition
period determined under the contractual arrangements. Our current ratio further decreased from
1.23 as of December 31, 2024 to 0.93 as of August 31, 2025, primarily due to the continuous
operating expenditures incurred mainly for our research and development and an increase in
redemption liabilities with the amount of RMB7.0 million.
LIQUIDITY AND CAPITAL RESOURCES
Our primary uses of cash are to fund the preclinical and clinical development of our drug
candidates, administrative expenses and other recurring expenses. Our net cash flows used in
operating activities was RMB52.0 million, RMB104.9 million, RMB67.9 million and
RMB59.4 million for the years ended December 31, 2023 and 2024 and the eight months ended
August 31, 2024 and 2025, respectively, primarily due to the significant research and
development costs and administrative expenses we incurred during the Track Record Period.
Our operating cash flow will continue to be affected by our research and development costs.
During the Track Record Period and up to the Latest Practicable Date, we have primarily
funded our working capital requirements through transfer of our equity interests in Taizhou
Hanzhong to Lepu and Pre-IPO Investments. As of the Latest Practicable Date, we have
obtained additional committed banking facilities with a total amount of RMB170.0 million, out
of which RMB120.0 million were unutilized.
Our management closely monitors uses of cash and cash balances and strives to maintain
a healthy liquidity for our operations. Going forward, we believe our liquidity requirements
will be satisfied by a combination of net proceeds from the Global Offering, funds received
from potential collaboration arrangements and cash generated from our operations after the
commercialization of our drug candidates. With the continuing expansion of our business, we
may require further funding through public or private offerings, debt financings, collaboration
arrangements or other sources. As of August 31, 2025, our cash and cash equivalents amounted
to RMB150.0 million. Except as discussed under the paragraphs headed “— Indebtedness” in
this section, we did not have any material mortgages, charges, debentures, loan capital, debt
FINANCIAL INFORMATION
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--- page 499 ---
securities, loans, 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.
Cash Flows
The following table sets forth our cash flows for the periods indicated:
For the Y ear
Ended December 31
For the Eight Months
Ended August 31
2023 2024 2024 2025
(in thousands of RMB)
(unaudited)
Net cash flows used in operating
activities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(51,994) (104,894) (67,918) (59,390)
Net cash flows from investing
activities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111893,956 96,620 78,432 35,742
Net cash flows from financing
activities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111890,220 6,486 8,463 12,492
Net (decrease)/increase in cash and
cash equivalents /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118132,182 (1,788) 18,977 (11,156)
Cash and cash equivalents at beginning
of year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111829,789 162,000 162,000 161,214
Effect of foreign exchange rate
changes, net /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111829 1,002 369 (58)
Cash and cash equivalents at end of
year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118162,000 161,214 181,346 150,000
Net Cash Flows Used in Operating Activities
For the eight months ended August 31, 2025, our net cash flows used in operating
activities were RMB59.4 million. Our loss before tax for the period was RMB99.9 million for
the same period. The difference between our loss for the period and our net cash flows used
in operating activities was primarily attributable to (i) decrease in other payables and accruals
of RMB3.5 million; and (ii) decrease in prepayments, other receivables and other assets of
RMB38.3 million, partially offset by (i) equity-settled share-based compensation expense of
RMB16.0 million; (ii) increase in trade payables of RMB3.9 million; and (iii) interest expenses
of RMB7.5 million.
FINANCIAL INFORMATION
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For the year ended December 31, 2024, our net cash flows used in operating activities was
RMB104.9 million. Our loss before tax for the period was RMB122.8 million for the same
year. The difference between our loss for the year and our net cash flows used in operating
activities was primarily attributable to (i) increase in prepayments, other receivables and other
assets of RMB16.3 million; (ii) income taxes paid of RMB5.8 million; (iii) bank interest
income of RMB1.6 million; (iv) fair value gains on FVTPL of RMB1.6 million and (v) interest
income from FVTPL of RMB1.3 million, partially offset by (i) equity-settled share-based
compensation expense of RMB22.3 million; and (ii) depreciation of right-of-use assets of
RMB3.4 million.
For the year ended December 31, 2023, our net cash flows used in operating activities was
RMB52.0 million. Our loss before tax for the year was RMB93.4 million for the same period.
The difference between our loss for the year and our net cash flows used in operating activities
was primarily attributable to (i) increase in prepayments, other receivables and other assets of
RMB4.4 million; (ii) interest income from FVTPL of RMB2.3 million; (iii) income taxes paid
of RMB2.1 million; (iv) bank interest income of RMB1.9 million; and (v) decrease in other
payables and accruals of RMB1.0 million, partially offset by (i) equity-settled share-based
compensation expense of RMB15.5 million; and (ii) fair value losses on FVTPL of RMB33.1
million.
We recorded net operating cash outflows during the Track Record Period. Going forward,
we plan to improve our net operating cash flow position through the continued advancement
of clinical development and commercialization of our drug candidates, business collaboration
and partnership, including out-licensing, commercialization collaboration, as well as
optimization of our cost structure and operating efficiency. In particular, we plan to (i) rapidly
advance the clinical development and commercialization of our Core Product; (ii) explore
potential collaboration opportunities for our product candidates, to attract the interest of
potential strategic partners; (iii) enhance management over our working capital; (iv) obtain
next round of financing of approximately RMB100.0 million in the first quarter of 2026; and
(v) implement comprehensive measures to optimize our cost management, and we aim to
strengthen our procurement management to further improve efficiency.
Net Cash Flows from Investing Activities
For the eight months ended August 31, 2025, our net cash flows from investing activities
were RMB35.7 million, primarily because we received payments from Lepu for (i) outstanding
one-off payment of RMB35.0 million from the disposal of our equity interest in Taizhou
Hanzhong and (ii) annual royalty fee of RMB13.1 million for 2024, partially offset by (iii)
purchase of bank wealth management product of RMB10.7 million.
For the year ended December 31, 2024, our net cash flows from investing activities were
RMB96.6 million, primarily attributable to (i) proceeds from disposal of an associate of
RMB40.0 million and (ii) redemption of structured deposits and wealth management products
of RMB35.5 million, partially offset by the purchases of property, plant and equipment of
RMB6.2 million.
FINANCIAL INFORMATION
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--- page 501 ---
For the year ended December 31, 2023, our net cash flows from investing activities were
RMB94.0 million, primarily attributable to (i) proceeds from disposal of an associate of
RMB65 million and (ii) redemption of structured deposits and wealth management products of
RMB48.9 million, partially offset by purchase of long-term time deposits of RMB20.0 million.
Net Cash Flows from Financing Activities
For the eight months ended August 31, 2025, our net cash flows from financing activities
were RMB12.5 million, primarily due to (i) payments for acquisition of non-controlling
interests of RMB31.2 million; and (ii) payment of listing expenses of RMB4.0 million,
partially offset by new interest-bearing bank borrowings of RMB50.0 million.
For the year ended December 31, 2024, our net cash flows from financing activities were
RMB6.5 million which was primarily attributable to the proceeds from issue of shares of
RMB12.8 million, partially offset by lease payments and payment of listing expenses of
RMB3.8 million and RMB2.5 million, respectively.
For the year ended December 31, 2023, our net cash flows from financing activities were
RMB90.2 million, which was primarily attributable to proceeds from issue of shares of the
Company of RMB91.4 million, partially offset by lease payments of RMB1.2 million.
CASH OPERATING COSTS
The following table sets forth our cash operating costs for the periods indicated:
For the Y ear Ended
December 31
For the Eight Months
Ended August 31
2023 2024 2024 2025
(in thousands of RMB) (in thousands of RMB)
(unaudited)
Costs relating to research and development of our Core Product:
HX009
Technical service expenses /H1118/H1118/H1118/H1118/H1118/H11182,885 8,369 6,561 3,575
Labor expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,956 1,141 895 3,367
Clinical expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,917 7,753 6,078 5,303
Material consumption expenses /H1118/H1118/H111866 913 716 2,991
Testing expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118863 330 259 108
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118818 850 666 2,281
Subtotal /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111813,505 19,356 15,175 17,625
FINANCIAL INFORMATION
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--- page 502 ---
For the Y ear Ended
December 31
For the Eight Months
Ended August 31
2023 2024 2024 2025
(in thousands of RMB) (in thousands of RMB)
(unaudited)
Costs relating to research and development of our Key Products:
HX301
Labor expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,696 326 289 1,246
Technical service expenses /H1118/H1118/H1118/H1118/H1118/H11181,323 1,286 1,138 243
Clinical expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118296 351 311 368
Material consumption expenses /H1118/H1118/H1118672 41 36 2
Testing expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118636 572 506 –
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111891 99 88 220
Subtotal /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,714 2,675 2,368 2,079
HX044
Labor expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118497 638 514 1,742
Technical service expenses /H1118/H1118/H1118/H1118/H1118/H11182,232 13,964 11,250 5,493
Clinical expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118––– 3 1 7
Material consumption expenses /H1118/H1118/H111894 137 110 122
Testing expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118747 725 584 309
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118264 903 727 591
Subtotal /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,834 16,367 13,186 8,574
WORKING CAPITAL CONFIRMATION
Our primary uses of cash are to fund our research and development, clinical trials,
purchase of equipment and raw materials and other recurring expenses. During the Track
Record Period and up to the Latest Practicable Date, we primarily funded our working capital
requirements through proceeds from transfer of our equity interests in Taizhou Hanzhong and
Pre-IPO Investments. We closely monitor uses of cash and cash balances and are committed to
maintaining a healthy liquidity for our operations.
Going forward, we believe our liquidity requirements will be satisfied by a combination
of net proceeds from the Global Offering, our proceeds from Pre-IPO Investments and transfer
of our equity interests in Taizhou Hanzhong. As of August 31, 2025, our cash and cash
equivalents amounted to RMB150.0 million. Other than the bank borrowings that we may
obtain, we do not have any plans for material external debt financing prior to the Listing.
Assuming an average cash burn rate going forward of 1.9 times the level in 2024, we estimate
that our cash and cash equivalents as of August 31, 2025 will be able to maintain our financial
FINANCIAL INFORMATION
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--- page 503 ---
viability for approximately 31 months, taking into account the estimated net proceeds
(assuming the Over-allotment Option is not exercised, at the Offer Price of HK$28.0 per H
Share, being the low-end of the indicative Offer Price range stated in this prospectus). Taking
these into account, our Directors believe that we have sufficient working capital to cover at
least 125% of our costs, including general, administrative and operating costs as well as
research and development costs, for at least the next 12 months from the Latest Practicable
Date.
INDEBTEDNESS
The following table sets forth our indebtedness by nature as of the dates indicated:
As of December 31
As of
August 31
As of
October 31
2023 2024 2025 2025
(in thousands of RMB)
(unaudited)
Interest-bearing bank
borrowings /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 50,000 50,000
Lease liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111815,031 11,831 10,666 9,731
Redemption liabilities /H1118/H1118/H1118/H1118/H1118/H1118101,488 131,564 138,481 139,359
Total indebtedness /H1118/H1118/H1118/H1118/H1118/H1118/H1118116,519 143,395 199,147 199,090
Lease Liabilities
The following table sets forth our lease liabilities as of the dates indicated:
As of December 31
As of
August 31
As of
October 31
2023 2024 2025 2025
(in thousands of RMB)
(unaudited)
Current /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,201 3,169 3,509 3,517
Non-current /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111811,830 8,662 7,157 6,214
Total lease liabilities /H1118/H1118/H1118/H1118/H1118/H111815,031 11,831 10,666 9,731
FINANCIAL INFORMATION
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--- page 504 ---
Except as discussed above, we did not have any material mortgages, charges, debentures,
loan capital, debt securities, loans, 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 October 31, 2025.
During the Track Record Period and up to the Latest Practicable Date, there was no
material covenant on any of the outstanding debt and any breach of the covenant; neither did
Group experience any difficulty in obtaining bank loans and other borrowings, default in
payment of bank loans and other borrowings or breach of covenants. Also, there has been no
material change in the indebtedness statement since October 31, 2025 and up to the date of the
prospectus.
Interest-bearing Bank Borrowings
During the Track Record Period, our interest-bearing bank borrowings consisted of both
secured and unsecured bank loans, carrying an interest rate of from 2.8% to 3.1% per annum
and are repayable within one year. We have no interest-bearing bank borrowings as of
December 31, 2023 and December 31, 2024. Our interest-bearing bank borrowings is RMB50.0
million as of August 31, 2025, mainly due to the borrowing of a one-year RMB 10.0 million
secured bank loan and a one-year RMB40.0 million unsecured bank loan in 2025.
Our Directors confirm that we had not experienced any difficulty in obtaining bank
borrowings, default in payment of bank borrowings or breach of covenants during the Track
Record Period and up to the Latest Practicable Date. As of Latest Practicable Date, we had
unutilized banking facilities of RMB120.0 million.
CAPITAL EXPENDITURES
We regularly incur capital expenditures to purchase and maintain our property, equipment
and intangible asset in order to enhance our research and development capabilities and expand
our business operations, upgrade our facilities and increase our operating efficiency. The
following table sets forth our capital expenditures for the periods indicated:
As of December 31
As of
August 31
2023 2024 2025
(in thousands of RMB)
Leasehold improvements /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,959 463 464
Software /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189 5––
Total capital expenditures /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,054 463 464
FINANCIAL INFORMATION
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--- page 505 ---
We plan to fund our planned capital expenditures mainly through a combination of
internal financial resources, the net proceeds from the Global Offering, bank borrowings, funds
from potential collaboration arrangements, revenue expected to be generated from sales of our
products in the future and others. For details, please refer to “Future Plans and Use of
Proceeds” in this prospectus. We may adjust our capital expenditures for any given period
according to our development plans or in light of market conditions and other factors as
appropriate.
CONTRACTUAL OBLIGATIONS
Capital Commitments
As of December 31, 2023 and 2024, we had capital commitments contracted, but not yet
provided, of RMB2.1 million and RMB463,000, respectively, primarily in connection with
software purchased and office buildings rented for our daily business operations. As of August
31, 2025, we did not have any capital commitments.
CONTINGENT LIABILITIES
As of December 31, 2023 and 2024 and August 31, 2025, 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
We had not entered into any off-balance sheet transactions as of the Latest Practicable
Date.
RELATED PARTY TRANSACTIONS
As of December 31, 2023 and 2024 and August 31, 2025, our related party transactions
were compensation for the services purchased from our related parties, mainly including
conducting preclinical trials for our pipeline products and manufacturing of active
pharmaceutical ingredients for HX301 and small molecule raw materials. For details, please
refer to “Connected Transactions” in this prospectus.
It is the view of our Directors that our related party transactions during the Track Record
Period (i) were conducted in the ordinary and usual course of business and on normal
commercial terms between the relevant parties; and (ii) do not distort our Track Record Period
results or make our historical results not reflective of future performance.
Details of our transactions with related parties during the Track Record Period are set out
in Note 30 to the Accountants’ Report in Appendix I to this prospectus.
FINANCIAL INFORMATION
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--- page 506 ---
MARKET RISK DISCLOSURE
The risks associated with our financial assets and liabilities include foreign currency
risks, credit risk and liquidity risk. The Directors reviews and agrees policies for managing
each of these risks and they are summarized below. For more details, see Note 33 to the
Accountants’ Report set out in the Appendix I to this prospectus.
Credit Risk
The carrying amounts of financial assets included in prepayments, other receivables and
other assets, pledged deposits, long-term time deposits at banks, and cash and cash equivalents
included in the consolidated statements of financial position represent our maximum exposure
to credit risk in relation to our financial assets.
Liquidity Risk
In the management of the liquidity risk, we monitor and maintain a level of cash and cash
equivalents deemed adequate by the management of our Group to finance our operations and
mitigate the effects of fluctuations in cash flows. For further details on our liquidity risk, please
refer to Note 33 to the Accountants’ Report set out in Appendix I to this prospectus.
DIVIDEND
We have never declared or paid any dividends on our ordinary shares or any other
securities. 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 intend to declare or pay any
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 subject to our Articles of Association and the PRC
Company Law, 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. No dividend shall be declared or
payable except out of our profits and reserves lawfully available for distribution. Regulations
in the PRC currently permit payment of dividends of a PRC company only out of accumulated
distributable after-tax profits as determined in accordance with its articles of association and
the accounting standards and regulations in China. As confirmed by our PRC Legal Adviser,
according to the PRC law, any future net profit that we make will have to be first applied to
make up for our historically accumulated losses, after which we will be obliged to allocate 10%
of our net profit to our statutory common reserve fund until such fund has reached more than
50% of our registered capital. We will therefore only be able to declare dividends after (i) all
our historically accumulated losses have been made up for; and (ii) we have allocated sufficient
net profit to our statutory common reserve fund as described above. As of the Latest Practicable
Date, there was no formal dividend policy or pre-determined dividend payout ratio for our
Group.
FINANCIAL INFORMATION
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--- page 507 ---
DISTRIBUTABLE RESERVES
As of August 31, 2025, we did not have any distributable reserves.
LISTING EXPENSES
Listing expenses to be borne by us are estimated to be approximately HK$53.5 million
(including underwriting commission, at the Offer Price of HK$30.00 per H Share), which
represent 9.7% of the gross proceeds from the Global Offering, assuming no Offer Shares are
issued pursuant to the Over-allotment Option. The above listing expenses are comprised of (i)
underwriting-related expenses, including underwriter commission, of HK$17.6 million, and (ii)
non-underwriting-related expenses of HK$35.9 million, including (a) the legal advisors and the
Reporting Accountants expenses of HK$20.7 million and (b) other fees and expenses of
HK$15.2 million. During the Track Record Period, listing expenses of approximately HK$15.0
million was charged to our consolidated income statements and approximately HK$7.4 million
was charged to equity. After the Track Record Period, approximately HK$9.9 million is
expected to be charged to our consolidated statements of profit or loss, and approximately
HK$21.2 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.
UNAUDITED PRO FORMA ADJUSTED CONSOLIDATED NET TANGIBLE ASSETS
For details, please refer to “Appendix II — Unaudited Pro Forma Financial Information”
in this prospectus.
NO MATERIAL ADVERSE CHANGE
Our Directors confirm that, as of the date of this Prospectus, there had been no material
adverse change in our financial or operational prospects since August 31, 2025, being the latest
balance sheet date of our consolidated financial statements as set out in the Accountants’
Report in Appendix I to this prospectus.
DISCLOSURE UNDER RULES 13.13 TO 13.19 OF THE LISTING RULES
Our Directors have confirmed that, as of 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 508 ---
FUTURE PLANS
Please see “Business — Our Strategies” for a detailed description of our future plans.
USE OF PROCEEDS
We estimate that we will receive net proceeds from the Global Offering of approximately
HK$496.3 million, after deducting underwriting commissions, fees and estimated expenses
payable by us in connection with the Global Offering taking into account any additional
discretionary incentive fee and assuming that the Over-allotment Option is not exercised, at the
Offer Price of HK$30.00 per H Share, being the mid-point of the indicative Offer Price range
stated in this document.
We currently intend to apply such net proceeds from the Global Offering for the following
purposes:
• Approximately 35%, or HK$173.7 million, will be used for the research and development
of our Core Product, namely, HX009;
— approximately 10.5%, or HK$52.1 million, is expected to be used throughout 2026
and 2027 to fund ongoing and planned clinical trials of HX009 in combination with
a pivotal trial stage (Stage III) FAKi drug for advanced biliary tract cancer;
We expect to complete the HX009-II-05 China Study by 2027, and a total amount
of approximately HK$21.2 million is expected to be used for this clinical study. Also
we expect to finish the pivotal-stage clinical study of HX009 for advanced biliary
tract cancer by 2030, and a total amount of approximately HK$91.6 million is
expected to be used for this clinical study.
— approximately 9.0%, or HK$44.7 million, is expected to be used to fund ongoing
and planned clinical trials of HX009 for R/R EBV
+ NHL;
We expect to complete the HX009-II-02 China Study by 2025, and net proceeds
allocated to this study will be used in the first half of 2026. A total amount of
approximately HK$5.0 million is expected to be used for final payments of this
clinical study. Also we expect to finish the pivotal-stage clinical study of HX009 for
R/R EBV
+ NHL by 2028, and net proceeds allocated to this study will be used
throughout 2026 and 2027. A total amount of approximately HK$100.0 million is
expected to be used for this clinical study.
— approximately 9.0%, or HK$44.7 million, is expected to be used to fund ongoing
and planned clinical trials of HX009 for advanced melanoma;
FUTURE PLANS AND USE OF PROCEEDS
– 497 –


--- page 509 ---
We expect to complete the HX009-I-01 China Study (Phase Ib) by 2026. Also we
expect to finish the pivotal-stage clinical study of HX009 for advanced melanoma
by 2028, and net proceeds allocated to this study will be used throughout 2026 and
2027. A total amount of approximately HK$87.6 million is expected to be used for
this clinical study.
We expect to commence the biologics license application in China for R/R EBV
+
NHL and advanced melanoma in 2028. In addition, we expect to expand indications
of HX009 to include advanced biliary tract cancer in 2030.
— approximately 6.5%, or HK$32.3 million, is expected to be used throughout 2026
and 2027 to fund ongoing and planned clinical trials of HX009 for advanced TNBC;
We expect to complete the HX009-II-04 China Study by 2027, and a total amount
of approximately HK$18.2 million is expected to be used for this clinical study. Also
we expect to finish the pivotal-stage clinical study of HX009 for advanced TNBC
by 2030, and a total amount of approximately HK$82.1 million is expected to be
used for this clinical study.
Net proceeds from the Global Offering allocated to HX009 will be used to: (i)
complete the HX009-I-01 China Study (Phase Ib), the HX009-II-02 China Study and
the HX009-II-05 China Study; (ii) complete the HX009-II-04 China Study; (iii)
complete the substantial part of the pivotal-stage clinical studies of HX009 for R/ R
EBV
+ NHL and advanced melanoma; and (iv) commence the pivotal-stage clinical
studies of HX009 for advanced BTC and advanced TNBC.
• Approximately 33%, or HK$163.8 million, will be used for the research and development
of our Key Products, namely, HX301 and HX044;
— approximately 8%, or HK$39.7 million, is expected to be used throughout 2026 and
2027 to fund ongoing and planned clinical trials of HX301 for glioblastoma in
combination with temozolomide;
We expect to complete the HX301-II-01 China Study by early 2028, and a total
amount of approximately HK$24.6 million is expected to be used for this clinical
study. Also we expect to finish the pivotal-stage clinical study of HX301 for
glioblastoma by 2029, and a total amount of approximately HK$120.2 million is
expected to be used for this clinical study. In addition, we expect to commence the
new drug application in China for HX301 in 2029.
Net proceeds from the Global Offering allocated to HX301 will be used to: (i)
complete the HX301-II-01 China Study; and (ii) commence the pivotal-stage
clinical studies of HX301 for glioblastoma.
FUTURE PLANS AND USE OF PROCEEDS
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--- page 510 ---
— approximately 25%, or HK$124.1 million, is expected to be used to fund ongoing
and planned clinical trials of HX044 for advanced solid tumors;
We expect to complete the HX044-I-01 Australia Study and HX044-I-01 China
Study by 2029, and net proceeds allocated to this study will be used throughout 2026
and 2027. A total amount of approximately HK$126.9 million is expected to be used
for these clinical studies. Also, we expect to finish the pivotal-stage clinical study
of HX044 by 2031, and net proceeds allocated to this study will be used in the
second half of 2027. A total amount of approximately HK$170.9 million is expected
to be used for this clinical study. In addition, we expect to commence the biologics
license application in China for HX044 in 2032.
Net proceeds from the Global Offering allocated to HX044 will be used to complete
part of the HX044-I-01 clinical studies.
• Approximately 17%, or HK$84.4 million, will be used for the research and development
of our other important products, including:
— approximately 6%, or HK$29.8 million, will be used to fund the research and
development of our preclinical autoimmune products, including HX035 and HX038.
We expect a total amount of approximately HK$539.5 million to be incurred for the
whole life cycle of such research and development;
— approximately 5%, or HK$24.8 million, will be used to fund the research and
development of our preclinical immuno-oncology products, including HX016-9 and
HX016-7. We expect a total amount of approximately HK$242.7 million to be
incurred for the whole life cycle of such research and development;
— approximately 6%, or HK$29.8 million, will be used to fund the research and
development of our preclinical ADC products, including HX111. We expect a total
amount of approximately HK$214.6 million to be incurred for the whole life cycle
of such research and development;
• Approximately 5%, or HK$25.0 million, will be used to fund the commercialization
and/or business development activities; and
— Commercialization activities, including (i) approximately 0.2%, or HK$1.1 million,
will be used for business travel expenses incurred from participating in domestic and
international academic meetings, medical industry meetings, and medical promotion
meetings etc.; (ii) approximately 0.3%, or HK$1.3 million, will be used for
exhibition fees incurred from participating such meetings; and (iii) approximately
0.6%, or HK$3.0 million, will be used for channel development and maintenance
fees incurred from developing and expanding sales channels, supply chain
management and training and motivation of sales personnel;
FUTURE PLANS AND USE OF PROCEEDS
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— Business development activities, including (i) approximately 0.8%, or HK$3.9
million, will be used for employee salaries; (ii) approximately 0.8%, or HK$4.0
million, will be used for business travels incurred for domestic and international
roadshows, project follow-ups, and travel for signing cooperation agreements; (iii)
approximately 1.6%, or HK$8.1 million, will be used for registration fees and
participating fees for attending domestic and international business meetings,
industry summits, and project negotiations; (iv) approximately 0.4%, or HK$1.9
million, will be used for market research incurred from purchasing the industry
reports and consulting reports annually, and establishing a long-term market
intelligence collection mechanism; and (v) approximately 0.4%, or HK$1.9 million,
will be used for consulting fees incurred from costs for legal advisors, financial
audits, and contract reviews.
• Approximately 10%, or HK$49.4 million, will be used for working capital and other
general corporate purposes.
The above allocation of the proceeds will be adjusted on a pro rata basis in the event that
the Offer Price is fixed at a higher or lower level compared to the mid-point of the indicative
Offer Price range.
If the Over-allotment Option is exercised in full, the net proceeds that we will receive will
be approximately HK$575.4 million, assuming an Offer Price of HK$30.00 per Share (being
the mid-point of the indicative Offer Price range). In the event that the Over-allotment Option
is exercised in full, we intend to apply the additional net proceeds to the above purpose in the
proportions stated above.
To the extent that the net proceeds are not immediately applied to the above purposes and
to the extent permitted by the relevant law and regulations, so long as it is deemed to be in the
best interests of our Group, we may hold such funds in short-term interest-bearing accounts at
licensed commercial banks and/or other authorized financial institutions (as defined under the
SFO or applicable laws and regulations in other jurisdictions). We will issue an appropriate
announcement if there is any material change to the above proposed use of proceeds.
For the fund required that is not covered by the net proceeds, we expect to fund the
outstanding portion with (i) equity financing in the secondary market; (ii) payments generated
from out licensing our products through business development; and (iii) bank borrowings.
FUTURE PLANS AND USE OF PROCEEDS
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--- page 512 ---
HONG KONG UNDERWRITERS AND INTERNATIONAL UNDERWRITERS
ICBC International Securities Limited
China Securities (International) Corporate Finance Company Limited
China Merchants Securities (HK) Co., Limited
Haitong International Securities Company Limited
CCB International Capital Limited
TFI Securities and Futures Limited
ABCI Securities Company Limited
SPDB International Capital Limited
Livermore Holdings Limited
Tiger Brokers (HK) Global Limited
Shanxi Securities International Limited
Beta International Securities Limited
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 Company expects the International Offering to be fully underwritten by
the International Underwriters. If, for any reason, the Offer Price is not agreed between the
Sponsor-Overall Coordinator (for itself and 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 1,832,100
Hong Kong Offer Shares and the International Offering of initially 16,488,900 International
Offer Shares, subject to, in each case, reallocation on the basis as described in “Structure of
the Global Offering” in this prospectus as well as the Over-allotment Option (in the case of the
International Offering).
UNDERWRITING
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--- page 513 ---
UNDERWRITING ARRANGEMENTS AND EXPENSES
Hong Kong Public Offering
Hong Kong Underwriting Agreement
Pursuant to the Hong Kong Underwriting Agreement, we are offering 1,832,100
Hong Kong Offer Shares (subject to reallocation) for subscription by members of the public in
Hong Kong at the Offer Price on, and subject to, the terms and conditions set out in this
prospectus and the Hong Kong Underwriting Agreement.
Subject to (a) the Stock Exchange granting approval for the listing of, and permission to
deal in, the H Shares in issue and to be issued pursuant to the Global Offering as mentioned
in this prospectus (including any additional H Shares which may be issued pursuant to the
exercise of the Over-allotment Option on the Main Board of the Stock Exchange and such
approval not having been subsequently withdrawn; and (b) certain other conditions set out in
the Hong Kong Underwriting Agreement (including the Sponsor-Overall Coordinator (for itself
and on behalf of the Hong Kong Underwriters) and our Company agreeing upon the Offer
Price), the Hong Kong Underwriters have agreed, severally but not jointly, to subscribe for, or
procure subscribers to subscribe for their respective applicable proportions of the Hong Kong
Offer Shares which are not taken up under the Hong Kong Public Offering on the terms and
conditions as set out in this prospectus and the Hong Kong Underwriting Agreement.
The Hong Kong Underwriting Agreement is conditional on and subject to, amongst 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 shall occur at any time prior to 8:00 a.m. on the Listing
Date, the Sponsor-Overall Coordinator (for itself and on behalf of the Hong Kong
Underwriters) shall be entitled, orally or in writing to our Company, terminate the Hong Kong
Underwriting Agreement with immediate effect:
(a) there develops, occurs, exists or comes into effect:
(i) any event or circumstance in the nature of force majeure (including, without
limitation, any acts of government, declaration of a national or international
emergency or war, calamity, crisis, epidemic, pandemic, outbreak, escalation,
adverse mutation or aggravation of disease (including, without limitation,
COVID-19, Severe Acute Respiratory Syndrome (SARS), swine or avian flu,
H5N1, H1N1, H7N9, Ebola virus, Middle East respiratory syndrome and such
related/mutated forms and the escalation of such disease), economic sanctions,
strikes, labor disputes, lock-outs, other industry actions, fire, explosion,
flooding, tsunami, earthquake, volcanic eruption, civil commotion, riots,
UNDERWRITING
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--- page 514 ---
rebellion, public disorder, acts of war, outbreak, escalation of hostilities
(whether or not war is declared), acts of God or acts of terrorism (whether or
not responsibility has been claimed), paralysis in government operations in or
affecting Hong Kong, the PRC, Singapore, the United States, the European
Union (or any of its member), United Kingdom, or any other jurisdictions
relevant to any member of the Group or the Global Offering (each a “ Relevant
Jurisdiction” and collectively, the “ Relevant Jurisdictions ”); or
(ii) any change, or any development involving a prospective change, or any event
or circumstance likely to result in any change or development involving a
prospective change, in any financial, economic, political, military, industrial,
fiscal, regulatory, currency, credit or market conditions (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; or
(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 the Stock Exchange, the New
Y ork Stock Exchange, the NASDAQ Global Market, the London Stock
Exchange, the Tokyo Stock Exchange, the Shanghai Stock Exchange or the
Shenzhen Stock Exchange; or
(iv) any general moratorium on commercial banking activities in any of the
Relevant Jurisdictions (declared by the relevant competent authority), 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; or
(v) any new law, 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 (or in the interpretation or
application by any court or other competent authority of) existing laws, in each
case, in or affecting the Relevant Jurisdictions; or
(vi) the imposition of economic sanctions, in whatever form, directly or indirectly,
by, or for the PRC or any other jurisdiction relevant to any member of the
Group; or
(vii) a change or development involving a prospective change in or affecting
taxation or exchange control, currency exchange rates or foreign investment
regulations (including, without limitation, a material devaluation of the United
States dollar, the Hong Kong dollar or the Renminbi against any foreign
currencies), or the implementation of any exchange control, in any of the
Relevant Jurisdictions; or
UNDERWRITING
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--- page 515 ---
(viii) any litigation or claim of any third party being threatened or instigated against
any member of the Group or any Director;
(ix) any Director or member of the senior management of the Company is being
charged with an indictable offence or prohibited by operation of law or
otherwise disqualified from taking part in the management of a company; or
(x) the chairman or chief executive officer of the Company vacating his office; or
(xi) an 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
(xii) a contravention by any member of the Group of the Listing Rules or applicable
Laws; or
(xiii) a prohibition on the Company for whatever reason from offering, allotting,
issuing or selling any of the Shares (including the Over-Allotment Option
Shares) pursuant to the terms of the Global Offering; or
(xiv) non-compliance of this prospectus (or any other documents used in connection
with the contemplated offer and sale of the Shares) or any aspect of the Global
Offering with the Listing Rules or any other applicable Laws; or
(xv) the issue or requirement to issue by the Company of any supplement or
amendment to this prospectus (or to any other documents used in connection
with the contemplated offer and sale of the Shares) pursuant to the Companies
Ordinance or the Companies (Winding Up and Miscellaneous Provisions)
Ordinance or the Listing Rules or any requirement or request of the Stock
Exchange and/or the SFC; or
(xvi) an 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,
which, individually or in the aggregate, in the sole opinion of the Sponsor-
Overall Coordinator (for itself and on behalf of the Hong Kong Underwriters)
UNDERWRITING
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--- page 516 ---
(1) has or will have or may have a material adverse effect on the assets,
liabilities, business, general affairs, management, prospects,
shareholders’ equity, profits, losses, results of operations, position or
condition, financial or otherwise, or performance of the Group as a
whole; or
(2) has or will have or may have a material adverse effect on the success of
the Global Offering or the level of applications under the Hong Kong
Public Offering or the level of interest under the International Offering;
or
(3) makes or will make or may make it inadvisable or inexpedient or
impracticable for the Global Offering to proceed or to market the Global
Offering; or
(4) has or will have or may have the effect of making any 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
(b) there has come to the notice of the Sponsor-Overall Coordinator (for itself and on
behalf of the Hong Kong Underwriters):
(i) that any statement contained in this prospectus and/or in any notices,
announcements, advertisements, communications or other documents issued or
used by or on behalf of the Company in connection with the Hong Kong Public
Offering (including any supplement or amendment thereto) was, when it was
issued, or has become, untrue, incorrect or misleading in any respect, or that
any forecast, estimate, expression of opinion, intention or expectation
contained in this prospectus and/or any notices, announcements,
advertisements, communications or other documents issued or used by or on
behalf of the Company in connection with the Hong Kong Public Offering
(including any supplement or amendment thereto) is not fair and honest and
based on reasonable assumptions; or
(ii) that any matter has arisen or has been discovered which would, had it arisen
or been discovered immediately before the date of this prospectus, constitute
an omission from this prospectus and/or in any notices, announcements,
advertisements, communications or other documents issued or used by or on
behalf of the Company in connection with the Hong Kong Public Offering
(including any supplement or amendment thereto); or
UNDERWRITING
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--- page 517 ---
(iii) any breach of any of the obligations imposed upon any party to the Hong Kong
Underwriting Agreement or the International Underwriting Agreement (other
than upon any of the Hong Kong Underwriters or the International
Underwriters); or
(iv) any event, act or omission which gives or is likely to give rise to any liability
of any of the indemnifying parties set out in the Hong Kong Underwriting
Agreement; or
(v) any adverse change, or any development involving a prospective adverse
change, in the assets, liabilities, business, general affairs, management,
prospects, shareholders’ equity, profits, losses, results of operations, position
or condition, financial or otherwise, or performance of the Group as a whole;
or
(vi) any breach of, or any event or circumstance rendering untrue or incorrect or
misleading in any respect, any of the representations, warranties, agreements
and undertakings of the Company and its Warranting Shareholders; or
(vii) that approval by the listing committee of the Stock Exchange of the listing of,
and permission to deal in, the H Shares to be issued or sold (including any
additional H Shares that may be issued or sold pursuant to the exercise of the
Over-allotment Option and the Shares to be issued pursuant to the Share
Incentive Plan) under the Global Offering is refused or not granted, other than
subject to customary conditions, on or before the Listing Date, or if granted,
that the approval is subsequently withdrawn, cancelled, qualified (other than
by customary conditions) revoked or withheld; or
(viii) a withdrawal by the Company of this prospectus (and/or any other documents
issued or used in connection with the Global Offering) or the Global Offering;
or
(ix) that a material portion of the orders placed or confirmed in the book-building
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 Cornerstone Investment Agreement
is terminated.
Undertakings to the Stock Exchange pursuant to the Listing Rules
Undertakings by our Company
Pursuant to Rule 10.08 of the Listing Rules, we have undertaken to the Stock Exchange
that we will not issue any further H Shares or securities convertible into equity securities of
our Company (whether or not of a class already listed) or enter into any agreement to such issue
within six months from the Listing Date (whether or not such issue of H Shares or securities
UNDERWRITING
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--- page 518 ---
will be completed within six months from the Listing Date), except (a) the issue of H Shares
or securities pursuant to the Global Offering (including the Over-allotment Option), or (b)
under any of the circumstances permitted pursuant to Rule 10.08 of the Listing Rules.
Undertakings by our Controlling Shareholders
Pursuant to Rule 10.07 of the Listing Rules and Chapter 4.13 of the Guide for New
Listing Applicants issued by the Stock Exchange, each of our Controlling Shareholders has
undertaken to the Stock Exchange that, save as disclosed in this prospectus and except pursuant
to (a) the Global Offering, (b) the Over-allotment Option, they will not:
(a) in the period commencing on the date by reference to which disclosure of his/its
shareholding is made in this prospectus and ending on the date which is six months
from the Listing Date (the “ First Six-month Period ”), 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 H Shares or securities in respect of which
he/it is shown by this prospectus to be the beneficial owner; or
(b) in the period of six months commencing on the date on which the First Six-month
Period expires (the “ Second Six-month Period ”), 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 H Shares or securities referred to in (a) 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 our Company (as defined in the Listing Rules).
In addition, in accordance with Note (3) to Rule 10.07(2) of the Listing Rules, each of the
Controlling Shareholders has further undertaken to the Stock Exchange and our Company that
during the First Six-month Period and the Second Six-month Period:
(a) when he/it pledges/charges any H Shares of our Company beneficially owned by
him/it in favour of an authorized institution (as defined in the Banking Ordinance
(Chapter 155 of the Laws of Hong Kong)) for a bona fide commercial loan pursuant
to Note (2) to Rule 10.07(2) of the Listing Rules, immediately inform our Company
of such pledge or charge together with the number of H Shares of our Company so
pledged or charged; and
(b) when he/it receives indications, either verbal or written, from the pledgee or chargee
of the H Shares (or our other securities) that any of the pledged or charged H Shares
(or our other securities) will be disposed of, immediately inform our Company of
such indications.
We will inform the Stock Exchange as soon as we have been informed of the above
matters by any of our Controlling Shareholders and disclose those matters by way of an
announcement as required under Rule 2.07C of the Listing Rules.
UNDERWRITING
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--- page 519 ---
Undertakings pursuant to the Hong Kong Underwriting Agreement
Undertakings by our Company
Our Company has undertaken to each of the Sole Sponsor, the Sponsor-Overall
Coordinator, the Overall Coordinators, the Joint Global Coordinators, the Joint Bookrunners,
the Joint Lead Managers, the Capital Market Intermediaries and the Hong Kong Underwriters
not to and to procure each other member of the Group not to, without the prior written consent
of the Sole Sponsor and the Sponsor-Overall Coordinator (for itself and 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 ”):
(a) allot, issue, sell, accept subscription for, offer to allot, issue or sell, contract or agree
to allot, issue or sell, mortgage, charge, pledge, hypothecate, lend, grant or sell any
option, warrant, contract or right to subscribe for or purchase, grant or purchase any
option, warrant, contract or right to allot, issue or sell, 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,
any H Shares or other securities of the Company or any shares or other securities of
such other member of the Group, as applicable, or any interest in any of the
foregoing (including, without limitation, any securities 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 any shares of such other member of the
Group, as applicable), or deposit any H Shares or other 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
(b) 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 H Shares or other
securities of the Company or any shares or other securities of such other member of
the Group, as applicable, or any interest in any of the foregoing (including, without
limitation, any securities convertible into or exchangeable or exercisable for or that
represent the right to receive, or any warrants or other rights to purchase, any H
Shares or any shares of such other member of the Group, as applicable); or
(c) enter into any transaction with the same economic effect as any transaction specified
in paragraphs (a) or (b) above; or
(d) offer to or agree to or announce any intention to effect any transaction specified in
paragraphs (a), (b) or (c) above,
UNDERWRITING
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--- page 520 ---
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 ”), our Company enters into
any such transactions specified in paragraphs (a), (b) or (c) above or offers or agrees or
contracts to, or announces, or publicly discloses, any intention to, enter into any such
transactions, our Company shall take all reasonable steps to ensure that it will not create a
disorderly or false market in the securities of our Company.
Undertakings by our Controlling Shareholders
Our Controlling Shareholders have undertaken to our Company, the Sole Sponsor, the
Sponsor-Overall Coordinator, the Overall Coordinators, the Joint Global Coordinators, the
Joint Bookrunners, the Joint Lead Managers, the Capital Market Intermediaries and the Hong
Kong Underwriters that, without the prior written consent of the Sole Sponsor and the
Sponsor-Overall Coordinator (for itself and on behalf of the Hong Kong Underwriters) and
unless in compliance with the requirements of the Listing Rules:
(a) they will not, at any time during the First Six-Month Period, (i) sell, offer to 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, 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, any H Shares or other
securities of the Company or any interest therein (including, without limitation, any
securities convertible into or exchangeable or exercisable for or that represent the
right to receive, or any warrants or other rights to purchase, any H Shares), or
deposit any H Shares or other securities of the Company 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 ownership of any H Shares or other securities of the Company or
any interest therein (including, without limitation, any securities convertible into or
exchangeable or exercisable for or that represent the right to receive, or any warrants
or other rights to purchase, any H Shares), or (iii) enter into any transaction with the
same economic effect as any transaction specified in (i) or (ii) above, or (iv) offer
to or agree to or announce any intention to effect any transaction specified in (i), (ii)
or (iii) above, in each case, whether any of the transactions specified in (i), (ii) or
(iii) above is to be settled by delivery of Shares or other securities of the Company
or in cash or otherwise (whether or not the issue of such Shares or other securities
will be completed within the First Six-Month Period);
UNDERWRITING
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--- page 521 ---
(b) they will not, during the Second Six-Month Period, enter into any of the transactions
specified in (a)(i), (ii) or (iii) above or offer to or agree to or announce any intention
to effect any such transaction if, immediately following any sale, transfer or disposal
or upon the exercise or enforcement of any option, right, interest or encumbrance
pursuant to such transaction, they will cease to be the Controlling Shareholders of
the Company; and
(c) until the expiry of the Second Six-Month period, in the event that they enter into any
of the transactions specified in (a)(i), (ii) or (iii) above or offer to or agrees to or
announce any intention to effect any such transaction, they will take all reasonable
steps to ensure that they will not create a disorderly or false market in the securities
of the Company.
Our Controlling Shareholders have further undertaken to our Company, the Sole Sponsor,
the Sponsor-Overall Coordinator, the Overall Coordinators, the Joint Global Coordinators, the
Joint Bookrunners, the Joint Lead Managers, the Capital Market Intermediaries and the Hong
Kong Underwriters that they will, at any time within the period commencing on the date of the
Hong Kong Underwriting Agreement and ending on the date which is 12 months after the
Listing Date:
(a) upon any pledge or charge in favor of an authorized institution (as defined in the
Banking Ordinance (Chapter 155 of the Laws of Hong Kong)) of any Shares or
securities or interests in the Shares or securities of our Company beneficially owned
by them for a bona fide commercial loan, immediately inform our Company, the
Sole Sponsor, the Sponsor-Overall Coordinator, the Overall Coordinators and the
Joint Global Coordinators in writing of such pledge or charge together with the
number of Shares or securities so pledged or charged; and
(b) upon any indication received by them, either verbal or written, from any pledgee or
chargee that any of the pledged or charged Shares or securities or interests in the
Shares or securities of our Company will be disposed of, immediately inform our
Company, the Sole Sponsor, the Sponsor-Overall Coordinator, the Overall
Coordinators and the Joint Global Coordinators in writing of such indications.
Our Company has agreed and undertaken to the Sole Sponsor, the Sponsor-Overall
Coordinator, the Overall Coordinators, the Joint Global Coordinators and each of the Hong
Kong Underwriters, that, upon receiving such information in writing from the Controlling
Shareholders, it shall, as soon as practicable, notify the Stock Exchange and make an
announcement in accordance with the Listing Rules.
UNDERWRITING
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--- page 522 ---
Indemnity
Each of our Company and the Controlling Shareholders have agreed to indemnify, among
others, the Sole Sponsor, the Sponsor-Overall Coordinator, the Overall Coordinators, the Joint
Global Coordinators, the Joint Bookrunners, the Joint Lead Managers, the Capital Market
Intermediaries and the Hong Kong Underwriters for certain losses which they may suffer,
including, among other matters, losses arising from the performance of their obligations under
the Hong Kong Underwriting Agreement and any breach by us of the Hong Kong Underwriting
Agreement.
Hong Kong Underwriters’ Interests in Our Company
Save as disclosed in this prospectus and save for the obligations under the Underwriting
Agreements, as of the Latest Practicable Date, none of the Hong Kong Underwriters had any
shareholding or beneficial interests in our Company or any member of our Group or has any
right or option (whether legally enforceable or not) to subscribe for or purchase or to nominate
persons to subscribe for or purchase securities in our Company or any member of our Group.
Following the completion of the Global Offering, the Hong Kong Underwriters and their
affiliated companies may hold a certain portion of the H Shares as a result of fulfilling their
obligations under the Hong Kong Underwriting Agreement.
International Offering
International Underwriting Agreement
In connection with the International Offering, it is expected that we will enter into the
International Underwriting Agreement with, among others, the International Underwriters, on
or around the Price Determination Date. Under the International Underwriting Agreement,
subject to the conditions set forth therein and subject to the Over-allotment Option, it is
expected that the International Underwriters would, severally but not jointly, agree to purchase,
or procure subscribers to purchase, the International Offer Shares being offered pursuant to the
International Offering (subject to, amongst others, any reallocation between the International
Offering and the Hong Kong Public Offering) or procure subscribers to purchase their
respective applicable proportions of International Offer Shares. 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 or is terminated, the Global Offering will not
proceed. It is expected that pursuant to the International Underwriting Agreement, our
Company will give undertakings similar to those given pursuant to the Hong Kong
Underwriting Agreement as described in “— Underwriting Arrangements and Expenses —
Hong Kong Public Offering — Undertakings pursuant to the Hong Kong Underwriting
Agreement” in this section. Please also refer to the section headed “Structure of the Global
Offering — International Offering” of this prospectus for further details.
UNDERWRITING
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Over-allotment Option and Stabilization
Our Company is expected to grant to the International Underwriters the Over-allotment
Option, exercisable by the Sponsor-Overall Coordinator (for itself and 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 our Company
may be required to issue up to an aggregate of 2,748,100 H Shares, representing not more than
15% of the number of Offer Shares initially available under the Global Offering, at the Offer
Price, to cover over-allocations in the International Offering, if any. For more details of the
arrangements relating to the Over-allotment Option and stabilization, see the section headed
“Structure of the Global Offering” in this prospectus.
Restrictions on the Offer Shares
No action has been taken to permit a public offering of the Offer Shares or the distribution
of this prospectus in any jurisdiction other than Hong Kong. Accordingly, without limitation
to the following, this prospectus may not be used for the purpose 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 prospectus and the offering and sales 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 pursuant to registration with or
authorization by the relevant securities regulatory authorities or an exemption therefrom. In
particular, the Hong Kong Offer Shares have not been publicly offered or sold, directly or
indirectly, in the PRC or the United States.
Commission and Expenses
The Overall Coordinators (for themselves and on behalf of the Underwriters) will receive
an underwriting commission (the “ Fixed Fees ”) equal to 2.4% of the aggregate sale proceeds
from the Global Offering (including any H Shares to be issued pursuant to the exercise of the
Over-allotment Option) (collectively, the “ Gross Proceeds ”). In addition, our Company may,
at our sole and absolute discretion, pay to the Overall Coordinators a discretionary incentive
fee up to 1% of the Gross Proceeds (the “ Discretionary Fees ”). Assuming the Discretionary
Fees are paid in full, the ratio of Fixed Fees and Discretionary Fees payable is therefore
70.6:29.4.
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.
UNDERWRITING
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Assuming the Over-allotment Option is not exercised and based on an Offer Price of
HK$30.0 (being the mid-point of our Offer Price range stated in this prospectus), the aggregate
commissions and fees (including the discretionary incentive fee), together with the Stock
Exchange listing fees, brokerage, the SFC transaction levy, the AFRC transaction levy, the
Stock Exchange trading fee, legal and other professional fees and printing and other expenses
relating to the Global Offering to be borne by the Company are estimated to be approximately
HK$41.0 million.
An aggregate amount of HK$4.7 million (excluding expenses) is payable by the Company
as sponsor fees to the Sole Sponsor.
MINIMUM PUBLIC FLOAT
Our Directors and the Overall Coordinators will ensure that there will be a minimum of
25% of the total issued H Shares held in public hands in accordance with Rule 8.08 of the
Listing Rules after completion of the Global Offering.
INDEPENDENCE OF THE SOLE SPONSOR
The Sole Sponsor satisfies the independence criteria applicable to sponsors as set out in
Rule 3A.07 of the Listing Rules.
ACTIVITIES BY SYNDICATE MEMBERS
We describe below a variety of activities that underwriters of the Hong Kong Public
Offering and the International Offering (together referred to as “ Syndicate Members ”), may
each individually undertake, and which do not form part of the underwriting or the 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 accounts 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 our Company
and/or persons and entities with relationships with our 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 our H Shares, those activities could include acting as agent for buyers and
sellers of the H Shares, entering into transactions with those buyers and sellers in a principal
capacity, proprietary trading in the H Shares, and entering into over the counter or listed
UNDERWRITING
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derivative transactions or listed or unlisted securities transactions (including issuing securities
such derivative warrants listed on a stock exchange) which have as their underlying assets,
assets including the H Shares. Those activities may require hedging activity by those entities
involving, directly or indirectly, the buying and selling of the H Shares. All such activity 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 H Shares, in baskets of securities or
indices including the H Shares, in units of funds that may purchase the H Shares, or in
derivatives related to any of the foregoing.
In relation to issues by Syndicate Members or their affiliates of any listed securities
having the H Shares as their underlying securities, whether on the Stock Exchange or on any
other stock exchange, the rules of the 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 H Shares in most cases.
All such activities may occur both during and after the end of the stabilizing period, see
the section headed “Structure of the Global Offering” of this prospectus for further details.
Such activities may affect the market price or value of the H Shares, the liquidity or trading
volume in the H Shares and the volatility of the price of the H Shares, and the extent to which
this occurs from day to day cannot be estimated.
When engaging in any of these activities, it should be noted that the Syndicate Members
are subject to restrictions, including the following:
(a) under the agreement among the Syndicate Members, all of the Syndicate Members
(except for the Stabilizing Manager or its designated affiliate as the Stabilizing
Manager) 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) all of the Syndicate Members must comply with all applicable laws, 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 our
Company and each of our 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
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THE GLOBAL OFFERING
This prospectus is published in connection with the Hong Kong Public Offering as part
of the Global Offering. The Global Offering comprises:
(i) the Hong Kong Public Offering of initially 1,832,100 H Shares (subject to
adjustment as mentioned below) for subscription by the public in Hong Kong as
described in the subsection headed “— The Hong Kong Public Offering” below; and
(ii) the International Offering of initially 16,488,900 H Shares (subject to adjustment as
mentioned below) outside the United States (including to professional and
institutional investors within Hong Kong) in offshore transactions in accordance
with Regulation S under the U.S. Securities Act as described in the subsection
headed “— The International Offering” below.
Investors may either apply for the Hong Kong Offer Shares under the Hong Kong Public
Offering or apply for or indicate an interest, if qualified to do so, for the International Offer
Shares under the International Offering, but may not do both.
The Offer Shares will represent approximately 13.45% of the enlarged issued share
capital of our Company immediately following the completion of the Global Offering,
assuming the Over-allotment Option is not exercised. If the Over-allotment Option is exercised
in full, the Offer Shares will represent approximately 15.16% of the enlarged issued share
capital of our Company immediately following the completion of the Global Offering and the
issue of the Offer Shares pursuant to the Over-Allotment Option.
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. The International Offering will
involve selective marketing of the International Offer Shares to institutional and professional
investors and other investors expected to have a sizeable demand for the International Offer
Shares in Hong Kong and other jurisdictions outside the United States in reliance on
Regulation S. The International Underwriters are soliciting from prospective investors’
indications of interest in acquiring the International Offer Shares under the International
Offering. Prospective investors will be required to specify the number of International Offer
Shares under the International Offering they would be prepared to acquire either at different
prices or at a particular price.
The number of Offer Shares to be offered under the Hong Kong Public Offering and the
International Offering, respectively, may be subject to reallocation as described in the
subsection headed “— The Hong Kong Public Offering — Reallocation” below.
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
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THE HONG KONG PUBLIC OFFERING
Number of Hong Kong Offer Shares Initially Offered
We are initially offering 1,832,100 H Shares for subscription by the public in Hong Kong
at the Offer Price, representing 10% of the total number of Offer Shares initially available
under the Global Offering. Subject to any reallocation of the Offer Shares between the
International Offering and the Hong Kong Public Offering, the Hong Kong Offer Shares will
represent approximately 1.3% of the total issued share capital of our Company immediately
following the completion of the Global Offering assuming that the Over-allotment Option is
not exercised.
The Hong Kong Public Offering is open to members of the public in Hong Kong as well
as to institutional and professional investors. 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 the
subsection headed “— Conditions of the Global Offering” below.
Allocation
Allocation of the Offer Shares to investors 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 board lots being allocated to pool A. Accordingly, the maximum number of Hong Kong
Offer Shares initially in pool A and pool B will be 916,100 and 916,000, respectively. The
Hong Kong Offer Shares in pool A will be allocated on an equitable basis to valid applicants
who have applied for Hong Kong Offer Shares with an aggregate subscription price of HK$5
million (excluding the brokerage, SFC transaction levy, AFRC transaction levy and Stock
Exchange trading fee payable) or less. The Hong Kong Offer Shares in pool B will be allocated
on an equitable basis to valid applicants who have applied for Hong Kong Offer Shares with
an aggregate subscription price of more than HK$5 million (excluding the brokerage, SFC
transaction levy, AFRC transaction levy and Stock Exchange trading fee payable) and up to the
total value in pool B.
STRUCTURE OF THE GLOBAL OFFERING
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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 undersubscribed, the surplus 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 this
paragraph only, the “price” for the Offer Shares means the price payable on application therein
(without regard to the Offer Price as finally determined). Applicants can only receive an
allocation of the 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 916,000 Hong Kong Offer Shares (being approximately 50% of the
1,832,100 Hong Kong Offer Shares initially available under the Hong Kong Public Offering)
are liable to be rejected.
Reallocation
The Offer Shares to be offered in the Hong Kong Public Offering and the International
Offering may, in certain circumstances, be reallocated as between these offerings at the
discretion of the Sponsor-Overall Coordinator, in accordance with Chapter 4.14 of the Guide
for New Listing Applicants, following below mechanism:
(a) where the Hong Kong Offer Shares are fully subscribed or oversubscribed
irrespective of the number of times, and the International Offer Shares are fully
subscribed or oversubscribed or undersubscribed, then up to 916,000 Offer Shares
may be reallocated from the International Offering to the Hong Kong Public
Offering, so that the total number of Offer Shares available for subscription under
the Hong Kong Public Offering will increase up to 2,748,100 Offer Shares,
representing approximately 15% of the number of Offer Shares initially available
under the Global Offering (before any exercise of the Over-allotment Option); and
(b) where the Hong Kong Offer Shares are undersubscribed:
(i) if the International Offering Shares are fully subscribed or oversubscribed, the
Sponsor-Overall Coordinator has the authority to reallocate all or any
unsubscribed Hong Kong Offer Shares to the International Offering, in such
proportions as the Sponsor-Overall Coordinator deems appropriate; and
(ii) if the International Offering Shares are undersubscribed, the Global Offering
will not proceed unless the Underwriters would subscribe for or procure
subscribers for their respective applicable proportions of the Offer Shares
being offered which are not taken up under the Global Offering on the terms
and conditions of the Prospectus and the Underwriting Agreements.
Given the initial allocation of the Offer Shares to the Hong Kong Public Offering and the
International Offering follows Mechanism B set out under paragraph 2 of Chapter 4.14 of the
Guide for New Listing Applicants and the provision of paragraph 4.2(b) of Practice Note 18
STRUCTURE OF THE GLOBAL OFFERING
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of the Listing Rules, no mandatory clawback or reallocation mechanism is required to increase
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.
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.
Applications
Each applicant under the Hong Kong Public Offering will be required to give an
undertaking and confirmation in the application submitted by him/her/it that he/she/it and any
person(s) for whose benefit he/she/it 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, and such applicant’s application is
liable to be rejected if such undertaking and/or confirmation is breached and/or untrue (as the
case may be) or if it has been or will be placed or allocated International Offer Shares under
the International Offering.
Applicants under the Hong Kong Public Offering may be required to pay, on application
(subject to application channels), the maximum Offer Price of HK$32.0 per Offer Share in
addition to the brokerage, SFC transaction levy, AFRC transaction levy and Stock Exchange
trading fee payable on each Offer Share. If the Offer Price, as finally determined in the manner
described in the subsection headed “— Pricing and Allocation” below, is less than the
maximum Offer Price of HK$32.0 per Offer Share, appropriate refund payments (including the
brokerage, SFC transaction levy, AFRC transaction levy and Stock Exchange trading fee
attributable to the surplus application monies) will be made to successful applicants (subject
to application channels), without interest. See the section headed “How to Apply for Hong
Kong Offer Shares” in this prospectus for further details.
STRUCTURE OF THE GLOBAL OFFERING
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THE INTERNATIONAL OFFERING
Number of International Offer Shares Initially Offered
Subject to reallocation as described above, the International Offering will consist of an
initial offering of 16,488,900 H Shares, representing 90% of the total number of Offer Shares
initially available under the Global Offering. 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 12.1%
of the enlarged issued share capital of our Company immediately following the completion of
the Global Offering (assuming the Over-allotment Option is not exercised).
Allocation
The International Offering will include selective marketing of the Offer Shares to
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 the Offer Shares pursuant to the International Offering will be effected in
accordance with the “book-building” process described in the subsection headed “— Pricing
and Allocation” below 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 Offer
Shares, and/or hold or sell its Offer Shares, after the listing of the Offer Shares on the Stock
Exchange. Such allocation is intended to result in a distribution of the International Offer
Shares on a basis which would lead to the establishment of a solid professional and institutional
shareholder base to the benefit of our Company and the Shareholders as a whole.
The Overall Coordinators (for themselves and on behalf of the International
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 allotment of Offer Shares under the Hong Kong Public Offering.
Reallocation
The total number of Offer Shares to be issued pursuant to the International Offering may
change as a result of the clawback arrangement and/or any reallocation of Offer Shares between
the Hong Kong Public Offering and the International Offering as described in the subsection
headed “— The Hong Kong Public Offering — Reallocation” above and the exercise of the
Over-allotment Option in whole or in part.
STRUCTURE OF THE GLOBAL OFFERING
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OVER-ALLOTMENT OPTION
In connection with the Global Offering, we may grant the Over-allotment Option to the
International Underwriters, exercisable by the Sponsor-Overall Coordinator (in its sole and
absolute discretion on behalf of the International Underwriters).
Pursuant to the Over-allotment Option (if granted), the International Underwriters will
have the right, exercisable by the Sponsor-Overall Coordinator (in its sole and absolute
discretion on behalf of the International Underwriters) at any time from the date of the
International Underwriting Agreement until 30 days from the last day for the lodging of
applications under the Hong Kong Public Offering (being the last day for the exercise of the
Over-allotment Option), to require our Company to allot and issue up to an aggregate of
2,748,100 additional Offer Shares, representing not more than 15% of the total number of Offer
Shares initially available under the Global Offering, at the Offer Price under the International
Offering to, amongst others, cover over-allocations in the International Offering, if any.
If the Over-allotment Option is exercised in full, the additional International Offer Shares
to be issued pursuant thereto will represent approximately 2.0% of the issued share capital of
the Company immediately after the completion of the Global Offering and the exercise of the
Over-allotment Option. 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 new
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.
In connection with the Global Offering, the Stabilizing Manager, its affiliates or any
person acting for it, on behalf of the Underwriters, may, to the extent permitted by applicable
laws of Hong Kong or elsewhere, over-allocate or effect transactions with a view to stabilizing
or supporting the market price of the H Shares at a level higher than that which might otherwise
prevail in the open market for a limited period after the Listing Date. However, there is no
obligation on the Stabilizing Manager or any person acting for it to conduct any such
stabilizing action. Such stabilizing actions, if taken, (i) will be conducted at the absolute
discretion of the Stabilizing Manager or any person acting for it and in what the Stabilizing
Manager reasonably regards as the best interest of us, (ii) may be discontinued at any time and
(iii) is required to be brought to an end within 30 days of the last day for lodging applications
under the Hong Kong Public Offering.
STRUCTURE OF THE GLOBAL OFFERING
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Stabilization actions permitted in Hong Kong pursuant to the Securities and Futures
(Price Stabilising) Rules of the SFO (Chapter 571W of the Laws of Hong Kong) include (i)
over-allocation for the purpose of preventing or minimizing any reduction in the market price
of the H Shares, (ii) selling or agreeing to sell the H 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
H Shares, (iii) purchasing or subscribing for, or agreeing to purchase or subscribe for, the H
Shares pursuant to the Over-allotment Option in order to close out any position established
under (i) or (ii) above, (iv) purchasing, or agreeing to purchase, any of the H Shares for the sole
purpose of preventing or minimizing any reduction in the market price of the H Shares, (v)
selling or agreeing to sell any H Shares in order to liquidate any position established as a result
of those purchases and (vi) offering or attempting to do anything as described in (ii), (iii), (iv)
or (v) above.
Specifically, prospective applicants for and investors in the Offer Shares should note that:
 the Stabilizing Manager or any person acting for it may, in connection with the stabilizing
action, maintain a long position in the H Shares;
 there is no certainty as to the extent to which and the time or period for which the
Stabilizing Manager or any person acting for it will maintain such a long position;
 liquidation of any such long position by the Stabilizing Manager or any person acting for
it and selling in the open market, may have an adverse impact on the market price of the
H Shares;
 no stabilizing action can be taken to support the price of the H 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
H Shares, and therefore the price of the H Shares, could fall;
 stabilizing activities by the Stabilizing Manager or any person acting for it may stabilize,
maintain or otherwise affect the market price of our H Shares. This means the price of our
H Shares may be higher than the price that otherwise might exist in the open market;
 the price of the H Shares cannot be assured to stay at or above the Offer Price by the
taking of any stabilizing action; and
 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 Stabilizing Manager will arrange cover of up
to an aggregate of 2,748,100 H Shares, representing up to 15% of the total number of Offer
Shares initially available under the Global Offering, through delayed delivery arrangements
STRUCTURE OF THE GLOBAL OFFERING
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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 fully paid on the Listing Date. Both the size of such cover and the
extent to which the Over-allotment Option can be exercised will depend on whether
arrangements can be made with investors such that a sufficient number of H Shares can be
delivered on a delayed basis. If no investor in the International Offering agrees to the delayed
delivery arrangements, no stabilizing actions will be undertaken by the Stabilizing Manager
and the Over-allotment Option will not be exercised.
Our Company will ensure or procure that an announcement in compliance with the
Securities and Futures (Price Stabilising) Rules of the SFO (Chapter 571W of the Laws of
Hong Kong) will be made within seven days of the expiration of the stabilization period.
Over-allocation
Following any over-allocation of the H Shares in connection with the Global Offering, the
Stabilizing Manager or any person acting for it may cover such over-allocation by, amongst
others, exercising the Over-allotment Option in full or in part, or by using H Shares purchased
by the Stabilizing Manager (or any person acting for it) in the secondary market at prices that
do not exceed the Offer Price or a combination of these means.
PRICING AND ALLOCATION
Determining the Pricing of the Offer Shares
Pricing of the Offer Shares for the purpose of the various offerings under the Global
Offering will be determined on the Price Determination Date, which is expected to be on or
about Friday, December 19, 2025 and, in any event, no later than 12:00 noon on Friday,
December 19, 2025, by agreement between the Sponsor-Overall Coordinator (for itself and on
behalf of the Underwriters) and our Company, and the number of Offer Shares to be allocated
under the various offerings will be determined shortly thereafter.
Offer Price Range
The Offer Price will not be more than HK$32.0 per Offer Share and is expected to be not
less than HK$28.0 per Offer Share, unless otherwise announced, as further explained below.
Applicants under the Hong Kong Public Offering may be required to pay, on application
(subject to application channels), the maximum Offer Price plus brokerage of 1.0%, 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$3,232.27 for one board lot of 100 Offer 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.
STRUCTURE OF THE GLOBAL OFFERING
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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.
The Sponsor-Overall Coordinator (for itself and 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 prior
consent of our Company, reduce the number of Offer Shares offered and/or the Offer Price
range as 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, our 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 our Company and the Stock Exchange at
www.hanxbio.com and www.hkexnews.hk , respectively, notices of the reduction, the
cancellation of the offering and the relaunch of the Global Offering at the revised number of
Offer Shares and/or the revised Offer Price. 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 that may change as a
result of any such reduction.
Our Company will also, as soon as practicable following the decision to make any such
reduction, and in any event not later than the morning of the last day for lodging applications
under the Hong Kong Public Offering:
(a) issue a supplemental prospectus, as the relevant laws or government authority or
regulatory authorities may require as soon as practicable following the decision to
make the change, updating investors of such reduction together with an update of all
financial and other information in connection with such change;
(b) where appropriate, extend the period under which the Global Offering was open for
acceptance to allow potential investors the sufficient time to consider their
subscriptions or reconsider their existing subscriptions; and
(c) give potential investors who had applied for the Offer Shares the right to withdraw
their applications given the change in circumstances.
The Global Offering will be canceled and subsequently relaunched on FINI pursuant to
the supplemental prospectus. Upon the issue of such a notices and supplemental prospectus, the
revised number of Offer Shares and/or the Offer Price range will be final and conclusive and
the Offer Price, if agreed upon by the Sponsor-Overall Coordinator (for itself and on behalf of
the Underwriters) and our Company, will be fixed within such revised Offer Price range.
STRUCTURE OF THE GLOBAL OFFERING
– 523 –


--- page 535 ---
In the absence of any such notice and supplemental prospectus so published, the number
of Offer Shares will not be reduced and/or the Offer Price, if agreed upon between our
Company and the Sponsor-Overall Coordinator (for itself and on behalf of the Underwriters),
will under no circumstances be set outside the indicative Offer Price range stated in this
prospectus. If the number of Offer Shares and/or the Offer Price is reduced, applicants who
have submitted an application under the Hong Kong Public Offering will be entitled to
withdraw their applications unless positive confirmations from the applicants to proceed are
received.
If our Company is unable to reach an agreement with the Sponsor-Overall
Coordinator (for itself and on behalf of the Underwriters) on the Offer Price by 12:00
noon on Friday, December 19, 2025, the Global Offering will not proceed and will lapse
immediately.
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.
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.
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 conditional
upon the International Underwriting Agreement being signed and becoming unconditional and
is subject to our Company and the Sponsor-Overall Coordinator (for itself and on behalf of the
Underwriters) agreeing on the Offer Price on or around the Price Determination Date.
We expect to enter into the International Underwriting Agreement relating to the
International Offering on or around the Price Determination Date.
These underwriting arrangements under the Hong Kong Underwriting Agreement and the
International Underwriting Agreement are summarised in the section headed “Underwriting” in
this prospectus.
STRUCTURE OF THE GLOBAL OFFERING
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--- page 536 ---
CONDITIONS OF THE GLOBAL OFFERING
Acceptance of all applications for Offer Shares will be conditional on:
(i) the Listing Committee granting approval for the listing of, and permission to deal in,
the H Shares in issue and to be issued pursuant to the Global Offering on the Main
Board of the Stock Exchange (including the additional H Shares which may be
issued pursuant to the exercise of the Over-allotment Option), and such listing and
permission not subsequently having been withdrawn or revoked prior to the
commencement of dealings in the H Shares on the Stock Exchange;
(ii) the Offer Price having been agreed between our Company and the Sponsor-Overall
Coordinator (for itself and on behalf of the Underwriters) on or around the Price
Determination Date;
(iii) the execution and delivery of the International Underwriting Agreement on or
around the Price Determination Date; and
(iv) the obligations of the Underwriters under each of the Hong Kong Underwriting
Agreement and the International Underwriting Agreement becoming and remaining
unconditional and not having been terminated in accordance with the terms of the
respective Underwriting Agreements,
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 our Company and the
Sponsor-Overall Coordinator (for itself and on behalf of the Underwriters) on or before 12:00
noon on Friday, December 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, amongst other things, the other offering becoming unconditional
and not having been terminated in accordance with its terms.
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. We will
as soon as possible publish or cause to be published a notice of the lapse of the Hong Kong
Public Offering on the websites of the Stock Exchange at www.hkexnews.hk and our Company
at www.hanxbio.com . 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. Dispatch/Collection of H 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 bank or other bank(s) in Hong Kong licensed under the Banking
Ordinance (Chapter 155 of the Laws of Hong Kong).
STRUCTURE OF THE GLOBAL OFFERING
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--- page 537 ---
H Share certificates for the Offer Shares will only become valid at 8:00 a.m. on Tuesday,
December 23, 2025, the date of commencement of dealing in our H Shares, provided that the
Global Offering has become unconditional in all respects and the right of termination described
in the section headed “Underwriting” in this prospectus has not been exercised.
APPLICATION FOR LISTING ON THE STOCK EXCHANGE
We have applied to the Stock Exchange for the listing of, and permission to deal in, the
H Shares in issue and to be issued pursuant to the Global Offering and as mentioned in this
prospectus.
No part of our Company’s share or loan capital is listed on or dealt in on any other stock
exchange and no such listing or permission to deal is being or proposed to be sought in the near
future.
H SHARES WILL BE ELIGIBLE FOR ADMISSION INTO CCASS
All necessary arrangements have been made to enable the H Shares to be admitted into
CCASS.
If the Stock Exchange grants the listing of, and permission to deal in, the H Shares and
our Company complies with the stock admission requirements of HKSCC, the H 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 H Shares on the Stock Exchange
or any other date HKSCC chooses. 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 HKSCC
Operational Procedures in effect from time to time. Investors should seek the advice of their
stockbroker or other professional advisers for details of the settlement arrangements as such
arrangements may affect their rights and interests.
DEALING ARRANGEMENTS
Assuming that the Hong Kong Public Offering becomes unconditional at or before 8:00
a.m. in Hong Kong on Tuesday, December 23, 2025, it is expected that dealings in the H Shares
on the Stock Exchange will commence at 9:00 a.m. on Tuesday, December 23, 2025.
The H Shares will be traded on the Main Board of the Stock Exchange in board lots of
100 H Shares each and the stock code of the H Shares will be 3378.
STRUCTURE OF THE GLOBAL OFFERING
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--- page 538 ---
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.hanxbio.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 HK eIPO White Form service only ).
Unless permitted by the Listing Rules or a waiver and/or consent has 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 his/her/its close associates; or
 are a Director, Supervisor or any of his/her close associates.
2. Application Channels
The Hong Kong Public Offering period will begin at 9:00 a.m. on Monday, December 15,
2025 and end at 12:00 noon on Thursday, December 18, 2025 (Hong Kong time).
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 539 ---
To apply for Hong Kong Offer Shares, you may use one of the following application
channels:
Application Channel Platform Target Investors Application Time
HK eIPO White
Form service /H1118/H1118/H1118/H1118
www.hkeipo.hk Investors who would like to
receive a physical H
Share certificate. Hong
Kong Offer Shares
successfully applied for
will be allotted and issued
in your own name.
From 9:00 a.m. on Monday,
December 15, 2025 to
11:30 a.m. on Thursday,
December 18, 2025, Hong
Kong time.
The latest time for
completing full payment
of application monies will
be 12:00 noon on
Thursday, December 18,
2025, Hong Kong time.
HKSCC EIPO
channel /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Y our broker or custodian
who is a HKSCC
Participant will submit an
EIPO application on your
behalf through HKSCC’s
FINI system in
accordance with your
instruction
Investors who would not
like to receive a physical
H 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 HK eIPO White Form 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
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--- page 540 ---
For those applying through the HK eIPO White Form service, once you complete
payment in respect of any application instructions given by you or for your benefit through the
HK eIPO White Form 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 HK eIPO White
Form service more than once and obtaining different payment reference numbers without
effecting full payment in respect of a particular reference number will not constitute an actual
application.
If you apply through the HK eIPO White Form service, you are deemed to have
authorized the HK eIPO White Form Service Provider to apply on the terms and conditions
in this prospectus, as supplemented and amended by the terms and conditions of the HK eIPO
White Form 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
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--- page 541 ---
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
 Identify 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. Legal Entity Identifier (“ 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 HK eIPO White Form 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. The number of joint applicants may not exceed four. If you are a firm, the applicant must be in
the individual members’ names.
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 530 –


--- page 542 ---
2. The applicant’s full name as shown on their identity document must be used and the surname, given
name, middle and other names (if any) must be input in the same order as shown on the identity
document. 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 (including both Hong Kong Residents and Hong Kong
Permanent Residents), the HKID number must be used when making an application to subscribe for
shares in the Hong Kong Public Offering (including both Hong Kong Residents and Hong Kong
Permanent Residents). 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 account holders on FINI is capped at four
(1) in accordance with market
practice.
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 agents, 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.
(1) Subject to change, if the Company’s Articles of Incorporation and applicable company law prescribe a lower
cap.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 543 ---
4. Permitted Number of Hong Kong Offer Shares for Application
Board lot size : 100 H 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$32.0
per H Share.
If you are applying through the HKSCC
EIPO channel, your broker or custodian
may require you to pre-fund your
application, in such amount as
determined by the broker or custodian,
based on the applicable laws and
regulations in Hong Kong. Y ou are
responsible for complying with any such
pre-funding requirement imposed by
your broker or custodian with respect to
the Hong Kong Offer Shares you applied
for.
By instructing your broker or custodian
to apply for the Hong Kong Offer Shares
on your behalf through the HKSCC
EIPO channel, you (and, if you are joint
applicants, each of you jointly and
severally) are deemed to have instructed
and authorized HKSCC to cause HKSCC
Nominees (acting as nominee for the
relevant HKSCC Participants) to arrange
payment of the final Offer Price,
brokerage, SFC transaction levy, AFRC
transaction levy and the Stock Exchange
trading fee by debiting the relevant
nominee bank account at the Designated
Bank for your broker or custodian.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 544 ---
If you are applying through the HK
eIPO White Form service, you may
refer to the table below for the amount
payable for the number of H Shares you
have selected. Y ou must pay the
respective maximum amount payable on
application in full upon application for
Hong Kong Offer Shares.
No. of Hong
Kong Offer
Shares
applied for
Maximum
Amount
payable (2) on
application/
successful
allotment
No. of Hong
Kong Offer
Shares
applied for
Maximum
Amount
payable (2) on
application/
successful
allotment
No. of Hong
Kong Offer
Shares
applied for
Maximum
Amount
payable (2) on
application/
successful
allotment
No. of Hong
Kong Offer
Shares
applied for
Maximum
Amount
payable (2) on
application/
successful
allotment
(HK$) (HK$) (HK$) (HK$)
100 3,232.27 2,000 64,645.45 10,000 323,227.20 300,000 9,696,816.00
200 6,464.54 2,500 80,806.80 20,000 646,454.40 400,000 12,929,088.00
300 9,696.81 3,000 96,968.15 30,000 969,681.60 500,000 16,161,360.00
400 12,929.09 3,500 113,129.52 40,000 1,292,908.80 600,000 19,393,632.00
500 16,161.35 4,000 129,290.88 50,000 1,616,136.00 700,000 22,625,904.00
600 19,393.63 4,500 145,452.25 60,000 1,939,363.20 800,000 25,858,176.00
700 22,625.90 5,000 161,613.60 70,000 2,262,590.40 916,000
(1) 29,607,611.52
800 25,858.18 6,000 193,936.32 80,000 2,585,817.60
900 29,090.45 7,000 226,259.05 90,000 2,909,044.80
1,000 32,322.72 8,000 258,581.75 100,000 3,232,272.00
1,500 48,484.08 9,000 290,904.48 200,000 6,464,544.00
Notes:
(1) Maximum number of Hong Kong Offer Shares you may apply for and this is approximately 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) or to the HK eIPO White Form Service Provider (for applications made through
the application channel of the HK eIPO White Form service) while the SFC transaction levy, the Stock
Exchange trading fee and the AFRC transaction levy will be paid to the SFC, the Stock Exchange and the
AFRC, respectively.
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. Applications 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.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 545 ---
Multiple applications made either through (i) the HK eIPO White Form service, (ii)
HKSCC EIPO channel, or (iii) both channels concurrently are prohibited and will be rejected.
If you have made an application through the HK eIPO White Form service or HKSCC EIPO
channel, you or any person(s) for whose benefit you have made the application shall not apply
further for any Offer Shares in the Global Offering.
The H Share Registrar would record all applications into its system and identify suspected
multiple applications with identical names and identification document numbers according to
the Best Practice Note on Treatment of Multiple/Suspected Multiple Applications (“ Best
Practice Note ”) issued by the Federation of Share Registrars Limited.
Since applications are subject to personal information collection statements,
identification document numbers displayed are redacted.
6. Terms and Conditions of An Application
By applying for Hong Kong Offer Shares through the HK eIPO White Form service or
HKSCC EIPO channel, you (or as the case may be, HKSCC Nominees will do the following
things on your behalf):
(a) undertake to execute all relevant documents and instruct and authorise our Company
and/or the Overall Coordinators, as agents of our Company, 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;
(b) 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 HK eIPO
White Form service (or as the case may be, the agreement you entered into with
your broker or custodian), and agree to be bound by them;
(c) (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;
(d) 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 546 ---
(e) 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;
(f) agree that the Sole Sponsor, the Sponsor-Overall Coordinator, the Overall
Coordinators, the Joint Global Coordinators, the Joint Bookrunners, the Joint Lead
Managers, the Capital Market Intermediaries, the Underwriters, any of their or our
Company’s respective directors, officers, employees, partners, agents, advisers and
any other parties involved in the Global Offering (collectively, the “ Relevant
Persons ”), the H Share Registrar and HKSCC will not be liable for any information
and representations not in this prospectus and any supplement to it;
(g) 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 our Company, the Relevant Persons, the H 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 “— G. Personal Data — 4. Transfer of personal data” in this
section;
(h) 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;
(i) 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 H 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;
(j) confirm that you are aware of the situations specified in the paragraph headed “—
C. Circumstances In Which Y ou Will Not Be Allocated Hong Kong Offer Shares” in
this section;
(k) 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;
(l) 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
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 547 ---
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;
(m) confirm that (i) your application or HKSCC Nominees’ application on your behalf
is not financed directly or indirectly by our Company, any of the directors, chief
executives, substantial Shareholder(s) or existing shareholder(s) of our Company or
any of our subsidiaries or any of their respective close associates; and (ii) you are
not accustomed or will not be accustomed to taking instructions from our Company,
any of the directors, chief executives, substantial Shareholder(s) or existing
shareholder(s) of our Company or any of our 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;
(n) warrant that the information you have provided is true and accurate;
(o) confirm that you understand that our Company 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;
(p) agree to accept Hong Kong Offer Shares applied for or any lesser number allocated
to you under the application;
(q) 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;
(r) (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 HK eIPO White Form service or by any one as your agent or by any other
person; and
(s) (if you are making the application as an agent for the benefit of another person)
warrant that (i) 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 or the HK
eIPO White Form Service Provider; and (ii) 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
– 536 –


--- page 548 ---
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 the HK eIPO White Form service or HKSCC EIPO channel:
Website /H1118/H1118/H1118From the “Allotment Results” page at
www.hkeipo.hk/IPOResult (or
www.tricor.com.hk/ipo/result ) with a
“search by ID” function.
The full list of (i) wholly or partially
successful applicants using the HK eIPO
White Form service and HKSCC EIPO
channel, and (ii) the number of Hong
Kong Offer Shares conditionally allotted
to them, among other things, will be
displayed at www.hkeipo.hk/IPOResult
or www.tricor.com.hk/ipo/result .
24 hours, from 11:00
p.m. on Monday,
December 22, 2025 to
12:00 midnight on
Sunday, December 28,
2025 (Hong Kong
time)
The Stock Exchange’s website at
www.hkexnews.hk and our Company’s
website at www.hanxbio.com which will
provide links to the abovementioned
websites of the H Share Registrar.
No later than 11:00 p.m.
on Monday, December
22, 2025 (Hong Kong
time)
Telephone /H1118+852 3691 8488 — the allocation results
telephone enquiry line provided by the H
Share Registrar.
Between 9:00 a.m. and
6:00 p.m., from
Tuesday, December 23,
2025 to Tuesday,
December 30, 2025
(Hong Kong time)
(except Saturday,
Sunday and public
holidays in Hong
Kong)
For those applying through HKSCC EIPO channel, you may also check with your broker
or custodian from 6:00 p.m. on Friday, December 19, 2025 (Hong Kong time).
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 537 –


--- page 549 ---
HKSCC Participants can log into FINI and review the allotment result from 6:00 p.m. on
Friday, December 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
Our Company expects to announce the results of the final Offer Price, the level of
indications of interest in the Global 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.hanxbio.com by no later than 11:00
p.m. on Monday, December 22, 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 the 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 H 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
– 538 –


--- page 550 ---
4. If:
 you make multiple applications or suspected multiple applications. Y ou may refer to the
paragraph headed “ — A. Applications 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, they or we
would violate applicable securities or other laws, rules or regulations.
5. If there is money settlement failure for allotted H 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
Banks 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 H 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 Global 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 H 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.
D. DESPATCH/COLLECTION OF H SHARE CERTIFICATES AND REFUND OF
APPLICATION MONIES
Y ou will receive one H 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 H Share certificates will be deposited into CCASS as
described below).
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 539 –


--- page 551 ---
No temporary document of title will be issued in respect of the H Shares. No receipt will
be issued for sums paid on application.
H Share certificates will only become valid at 8:00 a.m. on Tuesday, December 23, 2025
(Hong Kong time), provided that the Global Offering has become unconditional and the right
of termination described in the section headed “Underwriting — Underwriting Arrangements
and Expenses — Hong Kong Public Offering — Grounds for Termination” in this prospectus
has not been exercised. Investors who trade H Shares prior to the receipt of H Share certificates
or the H Share certificates becoming valid do so entirely at their own risk.
The right is reserved to retain any H Share certificate(s) and (if applicable) any surplus
application monies pending clearance of application monies.
The following sets out the relevant procedures and time:
HK eIPO White Form service HKSCC EIPO channel
Despatch/collection of H Share certificate 1
For application of
500,000 Hong
Kong Offer
Shares or more /H1118
Collection in person from the H
Share Registrar, Tricor Investor
Services Limited, at 17/F,
Far East Finance Centre,
16 Harcourt Road, Hong Kong.
Time: from 9:00 a.m. to 1:00 p.m.
on Tuesday, December 23, 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
authorized representative must
bear a letter of authorization
from your corporation stamped
with your corporation’s chop.
H 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.
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 540 –


--- page 552 ---
HK eIPO White Form service HKSCC EIPO channel
Both individuals and authorized
representatives must produce, at
the time of collection, evidence
of identity acceptable to the H
Share Registrar.
Note: If you do not collect your H
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 application of
less than 500,000
Hong Kong
Offer Shares /H1118/H1118/H1118/H1118
Y our H Share certificate(s) will be
sent to the address specified in
your application instructions by
ordinary post at your own risk.
Date: Monday, December 22, 2025
Refund mechanism for surplus application monies paid by you
Date /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Tuesday, December 23, 2025 Subject to the arrangement
between you and your
broker or custodian
Responsible party /H1118H Share Registrar Y our broker or custodian
Application monies
paid through
single bank
account /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
HK eIPO White Form e-Auto
Refund payment instructions to
your designated bank account.
Y our broker or custodian
will arrange refund to
your designated bank
account subject to the
arrangement between
you and it.
Application monies
paid through
multiple bank
accounts /H1118/H1118/H1118/H1118/H1118/H1118/H1118
Refund cheque(s) will be
despatched to the address as
specified in your application
instructions by ordinary post at
your own risk.
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 541 –


--- page 553 ---
Note:
1. 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 Monday, December 22, 2025 rendering it impossible for the relevant H Share certificates
to be despatched to HKSCC in a timely manner, our Company shall procure the H Share Registrar to
arrange for delivery of the supporting documents and H Share certificates in accordance with the
contingency arrangements as agreed between them. For further details, please refer to the paragraph
headed “ — E. Bad Weather Arrangements ” in this section.
E. BAD WEATHER ARRANGEMENTS
The Opening and Closing of the Application Lists
The application lists will not open or close on Thursday, December 18, 2025 if there is:
 a tropical cyclone warning signal number 8 or above;
 a black rainstorm warning; and/or
 Extreme Conditions,
(collectively, the “ Bad Weather Signals ”),
in force in Hong Kong at any time between 9:00 a.m. and 12:00 noon on Thursday, December
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 Bad Weather Signals in force at any time between
9:00 a.m. and 12:00 noon.
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.hanxbio.com of the revised timetable.
If a Bad Weather Signal is hoisted in the morning on the business day before Listing (i.e.
Monday, December 22, 2025), the H Share Registrar will make appropriate arrangements for
the delivery of the H Share certificates to the CCASS Depository’s service counter so that they
would be available for trading on the Listing Date (i.e. Tuesday, December 23, 2025).
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 542 –


--- page 554 ---
If a Bad Weather Signal is hoisted on Monday, December 22, 2025, for application of less
than 500,000 Hong Kong Offer Shares, despatch of physical H Share certificate(s) will be made
by ordinary post when the post office re-opens after the Bad Weather Signal is lowered or
cancelled (e.g. in the afternoon of Monday, December 22, 2025 or on Tuesday, December 23,
2025).
If a Bad Weather Signal is hoisted on Tuesday, December 23, 2025, for application of
500,000 Hong Kong Offer Shares or more, physical H Share certificate(s) will be available for
collection in person at the H Share Registrar’s office after the Bad Weather Signal is lowered
or cancelled (e.g. in the afternoon of Tuesday, December 23, 2025 or on Wednesday, December
24, 2025).
Prospective investors should be aware that if they choose to receive physical H Share
certificates issued in their own name, there may be a delay in receiving the H Share
certificates.
F. ADMISSION OF THE H SHARES INTO CCASS
If the Stock Exchange grants the listing of, and permission to deal in, the H Shares on the
Stock Exchange and we comply with the stock admission requirements of HKSCC, the H
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 H 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 HKSCC
Operational Procedures in effect from time to time.
All necessary arrangements have been made enabling the H Shares to be admitted into
CCASS.
Y ou should seek the advice of your broker or other professional adviser for details of the
settlement arrangement as such arrangements may affect your rights and interests.
G. PERSONAL DATA
The following Personal Information Collection Statement applies to any personal data
collected and held by our Company, the H Share Registrar, the receiving bank(s) 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.
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 543 –


--- page 555 ---
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 our Company and the H 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 our Company or our agents and the H Share Registrar is accurate
and up-to-date when applying for the Hong Kong Offer Shares or transferring the Hong Kong
Offer Shares into or out of their names or in procuring the services of the H 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 our
Company or the H 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 H Share certificate(s) to which you are entitled.
It is important that applicants for and holders of Hong Kong Offer Shares inform our
Company and the H 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 HK eIPO White Form e-Auto
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;
 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 H Shares
including, where applicable, HKSCC Nominees;
 maintaining or updating the register of members of our Company;
 verifying identities of applicants for and holders of the H Shares and identifying any
duplicate applications for the H Shares;
 facilitating Hong Kong Offer Shares balloting;
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 544 –


--- page 556 ---
 establishing benefit entitlements of holders of the H Shares, such as dividends, rights
issues, bonus issues, etc.;
 distributing communications from our Company and its subsidiaries;
 compiling statistical information and profiles of the holder of the H Shares;
 disclosing relevant information to facilitate claims on entitlements; and
 and any other incidental or associated purposes relating to the above and/or to enable our
Company and the H Share Registrar to discharge their obligations to applicants and
holders of the H Shares and/or regulators and/or any other purposes to which applicants
and holders of the H Shares may from time to time agree.
4. Transfer of personal data
Personal data held by our Company and the H Share Registrar relating to the applicants
for and holders of Hong Kong Offer Shares will be kept confidential but our Company and the
H 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:
 our Company’s appointed agents such as financial advisers, receiving bank(s) and
overseas principal share registrar;
 HKSCC or HKSCC Nominees, who will use the personal data and may transfer the
personal data to the H 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);
 any agents, contractors or third-party service providers who offer administrative,
telecommunications, computer, payment or other services to our Company or the H 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.
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 545 –


--- page 557 ---
5. Retention of personal data
Our Company and the H 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
our Company or the H Share Registrar hold their personal data, to obtain a copy of that data,
and to correct any data that is inaccurate. Our Company and the H 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 our Company and the H 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
H Share Registrar for the attention of the privacy compliance officer.
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 546 –


--- page 558 ---
The following is the text of a report received from the Company’ s reporting accountants,
Ernst & Young, Certified Public Accountants, Hong Kong, for the purpose of incorporation in
this Prospectus.
Ernst & Young
27/F , One T aikoo Place
979 King’s Road
Quarry Bay, Hon
g Kong
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ACCOUNTANTS’ REPORT ON HISTORICAL FINANCIAL INFORMATION TO THE
DIRECTORS OF HANX BIOPHARMACEUTICALS (WUHAN) CO., LTD. AND ICBC
INTERNATIONAL CAPITAL LIMITED
Introduction
We report on the historical financial information of Hanx Biopharmaceuticals (Wuhan)
Co., Ltd. (the “Company”) and its subsidiaries (together, the “Group”) set out on pages I-4 to
65, 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 2023 and 2024 and the eight months ended 31 August 2025 (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 2023 and 2024 and 31
August 2025 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 65 forms an integral part of this report, which has been prepared for inclusion
in the prospectus of the Company dated 15 December 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.
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
APPENDIX I ACCOUNTANTS’ REPORT
– I-1 –


--- page 559 ---
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 2023, 2024 and 31 August 2025 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 eight months ended 31
August 2024 and other explanatory information (the “Interim Comparative Financial
Information”). The directors of the Company are responsible for the preparation and
presentation 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 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.
APPENDIX I ACCOUNTANTS’ REPORT
– I-2 –


--- page 560 ---
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.
Certified Public Accountants
Hong Kong
15 December 2025
APPENDIX I ACCOUNTANTS’ REPORT
– I-3 –


--- page 561 ---
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 HKICPA (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 562 ---
CONSOLIDATED STATEMENTS OF PROFIT OR LOSS AND OTHER
COMPREHENSIVE INCOME
Y ear ended 31 December
Eight months ended
31 August
Notes 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Other income and gains /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185 6,664 7,681 12,313 2,626
Research and development costs /H1118/H1118/H1118(46,663) (74,721) (50,523) (56,178)
Administrative expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(17,220) (46,192) (16,116) (27,436)
Other expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186 (33,924) (209) (238) (11,413)
Interest expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188 (2,280) (9,379) (5,853) (7,532)
LOSS BEFORE TAX /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11187 (93,423) (122,820) (60,417) (99,933)
Income tax expense /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111811 8,263 5,898 11,997 12,495
LOSS FOR THE YEAR/PERIOD /H1118 (85,160) (116,922) (48,420) (87,438)
Attributable to:
Owners of the parent /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(76,056) (115,830) (47,953) (83,829)
Non-controlling interests /H1118/H1118/H1118/H1118/H1118/H1118/H1118(9,104) (1,092) (467) (3,609)
(85,160) (116,922) (48,420) (87,438)
OTHER COMPREHENSIVE
INCOME
Other comprehensive income that
may be reclassified to profit or
loss in subsequent periods:
Exchange differences on
translation of the financial
statements of the subsidiaries /H1118/H1118 537 60 242 (423)
TOTAL COMPREHENSIVE LOSS
FOR THE YEAR /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(84,623) (116,862) (48,178) (87,861)
Attributable to:
Owners of the parent /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(75,381) (115,774) (47,787) (84,479)
Non-controlling interests /H1118/H1118/H1118/H1118/H1118/H1118/H1118(9,242) (1,088) (391) (3,382)
(84,623) (116,862) (48,178) (87,861)
LOSS PER SHARE
ATTRIBUTABLE TO
ORDINARY EQUITY
HOLDERS OF THE PARENT
(Expressed in RMB per share)
Basic and diluted /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111813 (10.42) (10.60) (4.57) (7.11)
APPENDIX I ACCOUNTANTS’ REPORT
– I-5 –


--- page 563 ---
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
As at 31 December
As at
31 August
Notes 2023 2024 2025
RMB’000 RMB’000 RMB’000
NON-CURRENT ASSETS
Property, plant and equipment /H1118/H1118/H1118/H1118/H1118/H1118/H111814 8,340 11,820 11,907
Right-of-use assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111815 15,661 12,309 10,525
Other intangible assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111816 558 447 587
Prepayments, other receivables and
other assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111818 531 330 330
Financial assets at fair value through
profit or loss (“FVTPL”) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111819 242,373 233,778 210,100
Long-term time deposits at banks /H1118/H1118/H1118/H111820 20,016 – –
Total non-current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118287,479 258,684 233,449
CURRENT ASSETS
Prepayments, other receivables and
other assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111818 93,900 68,908 38,012
Financial assets at fair value through
profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111819 42,361 12,665 22,837
Pledged deposits /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111820 5 0 0––
Cash and cash equivalents /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111820 162,000 161,214 150,000
Total current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118298,761 242,787 210,849
CURRENT LIABILITIES
Trade payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111821 12,936 12,293 16,225
Other payables and accruals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111822 39,667 42,433 10,492
Lease liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111815 3,201 3,169 3,509
Redemption liabilities on ordinary
shares /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111824 – 131,564 138,481
Interest-bearing bank borrowings /H1118/H1118/H1118/H111828 – – 50,000
Tax payable /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11187,069 7,981 7,373
Total current liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111862,873 197,440 226,080
NET CURRENT
ASSETS/(LIABILITIES) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118235,888 45,347 (15,231)
TOTAL ASSETS LESS CURRENT
LIABILITIES /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118523,367 304,031 218,218
APPENDIX I ACCOUNTANTS’ REPORT
– I-6 –


--- page 564 ---
As at 31 December
As at
31 August
Notes 2023 2024 2025
RMB’000 RMB’000 RMB’000
NON-CURRENT LIABILITIES
Deferred tax liability /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111823 90,468 78,765 66,270
Lease liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111815 11,830 8,662 7,157
Redemption liabilities on ordinary
shares /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111824 101,488 – –
Total non-current liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118203,786 87,427 73,427
Net assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118319,581 216,604 144,791
EQUITY
Equity attributable to owners of the
parent
Paid-in capital/Share capital /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111825 9,525 11,790 11,790
Reserves /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111826 258,603 154,449 86,018
Equity attributable to owners of the
parent /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118268,128 166,239 97,808
Non-controlling interests /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111851,453 50,365 46,983
Total equity /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118319,581 216,604 144,791
APPENDIX I ACCOUNTANTS’ REPORT
– I-7 –


--- page 565 ---
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
Y ear ended 31 December 2023
Attributable to owners of the parent
Paid-in
capital
Capital
reserve*
Other
reserves*
Exchange
fluctuation
reserve*
Share-based
payment
reserve*
Retained
profits/
(Accumulated
losses)* Total
Non-
controlling
interests
Total
equity
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(note 25) (note 26) (note 26) (note 26)
At 1 January 2023 /H1118/H1118/H1118/H11183,600 – (5,000) (723) 29,289 76,585 103,751 316,203 419,954
Loss for the year /H1118/H1118/H1118/H1118– – – – – (76,056) (76,056) (9,104) (85,160)
Other comprehensive loss
for the year:
Exchange differences on
translation /H1118/H1118/H1118/H1118/H1118/H1118– – – 675 – – 675 (138) 537
Total comprehensive loss
for the year /H1118/H1118/H1118/H1118/H1118/H1118– – – 675 – (76,056) (75,381) (9,242) (84,623)
Acquisition of non-
controlling interests /H1118/H11183,215 38,049 181,070 – – – 222,334 (255,508) (33,174)
Capital injection /H1118/H1118/H1118/H1118780 90,601 – – – – 91,381 – 91,381
Redemption liabilities
from Series A and B
shares (note 24) /H1118/H1118/H1118– – (91,379) – – – (91,379) – (91,379)
Equity-settled share-based
payment (note 27) /H1118/H1118– – – – 15,492 – 15,492 – 15,492
Capital injection by
settlement of liabilities /H11181,930 – – – – – 1,930 – 1,930
At 31 December 2023 /H1118/H11189,525 128,650 84,691 (48) 44,781 529 268,128 51,453 319,581
APPENDIX I ACCOUNTANTS’ REPORT
– I-8 –


--- page 566 ---
Y ear ended 31 December 2024
Attributable to owners of the parent
Paid-in
capital/
Share
capital
Capital
reserve*
Other
reserves*
Exchange
fluctuation
reserves*
Share-based
payment
reserve*
Retained
profits/
(Accumulated
losses)* Total
Non-
controlling
interests
Total
equity
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(note 25) (note 26) (note 26) (note 26)
At 1 January 2024 /H1118/H1118/H1118/H11189,525 128,650 84,691 (48) 44,781 529 268,128 51,453 319,581
Loss for the year /H1118/H1118/H1118/H1118/H1118– – – – – (115,830) (115,830) (1,092) (116,922)
Other comprehensive loss
for the year:
Exchange differences on
translation /H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 56 – – 56 4 60
Total comprehensive loss
for the year /H1118/H1118/H1118/H1118/H1118/H1118– – – 56 – (115,830) (115,774) (1,088) (116,862)
Capital injection /H1118/H1118/H1118/H1118/H11182,265 10,577 – – – – 12,842 – 12,842
Redemption liabilities from
Series B+ shares
(note 24) /H1118/H1118/H1118/H1118/H1118/H1118/H1118– – (21,305) – – – (21,305) – (21,305)
Equity-settled share-based
payment (note 27) /H1118/H1118/H1118– – – – 22,348 – 22,348 – 22,348
Conversion into a joint
stock company (note 26) – (42,919) – – – 42,919 – – –
At 31 December 2024 /H1118/H1118/H111811,790 96,308 63,386 8 67,129 (72,382) 166,239 50,365 216,604
APPENDIX I ACCOUNTANTS’ REPORT
– I-9 –


--- page 567 ---
Eight months ended 31 August 2024 (Unaudited)
Attributable to owners of the parent
Paid-in
capital/
Share
capital
Capital
reserve
Other
reserves
Exchange
fluctuation
reserves
Share-based
payment
reserve
Retained
profits/
(Accumulated
losses) Total
Non-
controlling
interests
Total
equity
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(note 26) (note 26) (note 26)
At 1 January 2024 /H1118/H1118/H1118/H11189,525 128,650 84,691 (48) 44,781 529 268,128 51,453 319,581
Loss for the period /H1118/H1118/H1118/H1118– – – – – (47,953) (47,953) (467) (48,420)
Other comprehensive loss
for the period:
Exchange differences on
translation /H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 166 – – 166 76 242
Total comprehensive loss
for the period /H1118/H1118/H1118/H1118/H1118– – – 166 – (47,953) (47,787) (391) (48,178)
Capital injection /H1118/H1118/H1118/H1118/H11182,265 10,577 – – – – 12,842 – 12,842
Redemption liabilities from
Series B+ shares /H1118/H1118/H1118/H1118– – (21,305) – – – (21,305) – (21,305)
Equity-settled share-based
payment /H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – – 5,561 – 5,561 – 5,561
At 31 August 2024
(unaudited) /H1118/H1118/H1118/H1118/H1118/H111811,790 139,227 63,386 118 50,342 (47,424) 217,439 51,062 268,501
APPENDIX I ACCOUNTANTS’ REPORT
– I-10 –


--- page 568 ---
Eight months ended 31 August 2025
Attributable to owners of the parent
Paid-in
capital/
Share
capital
Capital
reserve*
Other
reserves*
Exchange
fluctuation
reserves*
Share-based
payment
reserve*
Accumulated
losses* Total
Non-
controlling
interests
Total
equity
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(note 25) (note 26) (note 26) (note 26)
At 1 January 2025 /H1118/H1118/H1118/H1118/H111811,790 96,308 63,386 8 67,129 (72,382) 166,239 50,365 216,604
Loss for the period /H1118/H1118/H1118/H1118/H1118– – – – – (83,829) (83,829) (3,609) (87,438)
Other comprehensive loss for
the period:
Exchange differences on
translation /H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – (650) – – (650) 227 (423)
Total comprehensive loss for
the period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – (650) – (83,829) (84,479) (3,382) (87,861)
Equity-settled share-based
payment (note 27) /H1118/H1118/H1118/H1118– – – – 16,048 – 16,048 – 16,048
At 31 August 2025 /H1118/H1118/H1118/H1118/H111811,790 96,308 63,386 (642) 83,177 (156,211) 97,808 46,983 144,791
These reserve accounts comprise the consolidated reserves of RMB258,603,000,
RMB154,449,000 and RMB86,018,000 as at 31 December 2023, 2024 and 31 August 2025,
respectively, in the consolidated statements of financial position.
APPENDIX I ACCOUNTANTS’ REPORT
– I-11 –


--- page 569 ---
CONSOLIDATED STATEMENTS OF CASH FLOWS
Y ear ended 31 December
Eight months ended
31 August
Notes 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
CASH FLOWS FROM
OPERA TING ACTIVITIES
Loss before tax /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(93,423) (122,820) (60,417) (99,933)
Adjustments for:
Interest expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188 2,280 9,379 5,853 7,532
Bank interest income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185 (1,867) (1,618) (350) (171)
Interest income from FVTPL /H1118/H1118/H1118/H1118/H11185 (2,258) (1,306) (917) (156)
Fair value losses/(gains) on FVTPL /H11185,6 33,095 (1,615) (10,689) 11,099
Foreign exchange losses/(gains),
net /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,6 646 (943) (126) (364)
Depreciation of property, plant and
equipment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111814 517 2,016 1,216 1,678
Depreciation of right-of-use assets /H1118/H111815 491 3,352 2,247 2,242
Amortisation of intangible assets /H1118/H1118/H111816 33 111 74 88
Equity-settled share-based
compensation expense /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111815,492 22,348 5,561 16,048
(Increase)/decrease in prepayments,
other receivables and other assets /H1118 (4,419) (16,273) (8,605) 2,120
(Increase)/decrease in pledged
deposits /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(500) 500 – –
Increase/(decrease) in trade
payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118881 (640) (2,677) 3,929
(Decrease)/increase in other
payables and accruals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(910) 8,420 (1,138) (3,502)
Cash used in operations /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(49,942) (99,089) (69,968) (59,390)
Income taxes (paid)/received /H1118/H1118/H1118/H1118/H1118/H1118(2,052) (5,805) 2,050 –
Net cash flows used in operating
activities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(51,994) (104,894) (67,918) (59,390)
APPENDIX I ACCOUNTANTS’ REPORT
– I-12 –


--- page 570 ---
Y ear ended 31 December
Eight months ended
31 August
Notes 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
CASH FLOWS FROM INVESTING
ACTIVITIES
Interest received /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,851 1,618 350 171
Interest income from structured
deposits and wealth management
products /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,258 1,306 917 156
Purchases of property, plant and
equipment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(4,232) (6,210) (2,741) (1,765)
Purchases of other intangible assets /H1118 (549) – – (228)
Redemption of structured deposits
and wealth management products /H1118 48,947 35,470 35,470 60,000
Purchases of structured deposits and
wealth management products /H1118/H1118/H1118/H1118– – – (70,731)
Proceeds from disposal of an
associate /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111818 65,000 40,000 40,000 35,000
Receipt of variable consideration
arising from disposal of an
associate /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118681 4,436 4,436 13,139
Proceeds from long-term time
deposits /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(20,000) 20,000 – –
Net cash flows from investing
activities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111893,956 96,620 78,432 35,742
APPENDIX I ACCOUNTANTS’ REPORT
– I-13 –


--- page 571 ---
Y ear ended 31 December
Eight months ended
31 August
Notes 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
CASH FLOWS FROM FINANCING
ACTIVITIES
Proceeds from issue of shares /H1118/H1118/H1118/H1118/H111891,381 12,842 12,842 –
Lease payments /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1,161) (3,808) (1,944) (1,962)
Payments for acquisition of non-
controlling interests /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – (31,244)
New interest-bearing bank
borrowings /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 50,000
Payment of listing expenses /H1118/H1118/H1118/H1118/H1118/H1118– (2,548) (2,435) (4,026)
Interest paid /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – (276)
Net cash flows from financing
activities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111890,220 6,486 8,463 12,492
NET INCREASE/(DECREASE) IN
CASH AND CASH
EQUIV ALENTS/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118132,182 (1,788) 18,977 (11,156)
Cash and cash equivalents at
beginning of year/period /H1118/H1118/H1118/H1118/H1118/H1118/H111829,789 162,000 162,000 161,214
Effect of foreign exchange rate
changes, net /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111829 1,002 369 (58)
CASH AND CASH EQUIV ALENTS
A T END OF YEAR/PERIOD /H1118/H1118/H1118/H1118162,000 161,214 181,346 150,000
ANAL YSIS OF BALANCES OF
CASH AND CASH
EQUIV ALENTS
Cash and bank balances /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111820 158,150 161,214 181,346 150,000
Non-pledged time deposits with
original maturity of less than
three months when acquired /H1118/H1118/H1118/H11183,85 0–––
Cash and cash equivalents as stated
in the statements of cash flows /H1118/H1118 162,000 161,214 181,346 150,000
APPENDIX I ACCOUNTANTS’ REPORT
– I-14 –


--- page 572 ---
STATEMENTS OF FINANCIAL POSITION OF THE COMPANY
As at 31 December
As at
31 August
Notes 2023 2024 2025
RMB’000 RMB’000 RMB’000
NON-CURRENT ASSETS
Property, plant and equipment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111814 6,405 10,099 10,393
Right-of-use assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111815 15,452 12,309 10,214
Investments in subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111817 78,438 78,438 78,438
Other intangible assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 214
Prepayments, other receivables and other
assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111818 5 3 1––
Long-term time deposits at banks /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111820,016 – –
Total non-current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118120,842 100,846 99,259
CURRENT ASSETS
Prepayments, other receivables and other
assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111818 35,488 32,801 53,602
Financial assets at fair value through
profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111819 10,000 – –
Cash and cash equivalents /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111820 15,667 38,956 36,287
Total current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111861,155 71,757 89,889
CURRENT LIABILITIES
Trade payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,575 1,982 2,869
Other payables and accruals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111822 34,268 87,824 84,370
Interest-bearing bank borrowings /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111828 – – 50,000
Redemption liabilities on ordinary shares /H1118/H111824 – 131,564 138,481
Lease liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111815 3,030 3,169 3,265
Total current liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111838,873 224,539 278,985
NET CURRENT ASSETS/(LIABILITIES) /H1118/H111822,282 (152,782) (189,096)
TOTAL ASSETS LESS CURRENT
LIABILITIES /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118143,124 (51,936) (89,837)
NON-CURRENT LIABILITIES
Deferred tax liability /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181 4 8––
Lease liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111815 11,830 8,662 7,076
Redemption liabilities on ordinary shares /H1118/H111824 101,488 – –
Total non-current liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118113,466 8,662 7,076
Net assets/(liabilities) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111829,658 (60,598) (96,913)
EQUITY/(DEFICITS)
Paid-in capital/Share capital /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189,525 11,790 11,790
Reserves /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111826 20,133 (72,388) (108,703)
Total equity/(deficits) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111829,658 (60,598) (96,913)
APPENDIX I ACCOUNTANTS’ REPORT
– I-15 –


--- page 573 ---
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION
1. CORPORATE INFORMATION
Hanx Biopharmaceuticals (Wuhan) Co., Ltd. (the “Company”) was incorporated in the People’s Republic of
China (the “PRC”) on 19 December, 2014, as a limited liability company under the Companies Law of the PRC. The
registered office of the Company is located at No. 02, 16/F, Unit 2, Block 1, Lot B, Guanggu World City, East Lake
Development Zone, Wuhan, Hubei Province, the PRC. On 6 November 2024, the Company was converted into a joint
stock company with limited liability under the Company Law of the PRC.
During the Relevant Periods, the Company and its subsidiaries (together, the “Group”) were principally
engaged in the research and development of immune-oncology therapies.
As at 31 August 2025, 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 set out below:
Name Notes
Place and date of
incorporation/
registration and
place of business
Issued
ordinary/registered
share capital
Percentage of
equity attributable
to the Company
Principal activitiesDirect Indirect
Hangzhou Hanx
Biopharmaceuticals Ltd.*
(“Hangzhou Hanx”)ψጫ
ʮ̡ /H1118/H1118/H1118/H1118/H1118
(a) Mainland China
3 Aug 2016
RMB14,545,455 85% – Research and
development of
drug candidates
Waterstone Hanbio PTY LTD
(“HanxBio (Australia)”) ዦ
ʮ̡ /H1118
(a) Australia
26 Oct 2018
AUD100 – 85% Research and
development of
drug candidates
Wuhan Hanxiong Biotech
Ltd.* (“Wuhan Hanxiong”)
ʮ̡ /H1118
(a) Mainland China
19 Nov 2013
RMB1,000,000 – 85% Research and
development of
drug candidates
Beijing Hanx Tai Biotech Co.
Ltd.* (“Beijing Hanx”) ̏ԯ
ʮ̡ /H1118/H1118
(a) Mainland China
10 Jan 2017
RMB1,000,000 – 85% Research and
development of
drug candidates
Hanx Aimtech
Biopharmaceutical
Limited (“HanxAimtech”)
Ҧ(࠰
ಥ)ʮ̡ /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
(b) Hong Kong
23 Aug 2023
HKD10,000 100% – Research and
development of
drug candidates
Hangzhou Hanx
Biopharmaceuticals (HK)
Co., Limited (“Hangzhou
HK”)ᔼᖹ(࠰
ಥ)ʮ̡ /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
(b) Hong Kong
19 Feb 2024
HKD10,000 – 85% Investment holding
Hanx Biopharmaceuticals Pty
Ltd. /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
(b) Australia
19 Apr 2024
AUD10,000 – 100% Research and
development of
drug candidates
HanxBio Inc. /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(a) USA
13 Dec 2023
USD15 – 100% Investment holding
* The English names of these companies represent the best effort made by the directors of the Company (the
“Directors”) to translate the Chinese names as these companies have not been registered with any official
English names.
APPENDIX I ACCOUNTANTS’ REPORT
– I-16 –


--- page 574 ---
Notes:
(a) No audited financial statements have been prepared, as the entities were not subject to any statutory audit
requirements under the relevant rules and regulations in their jurisdictions of incorporation.
(b) As at the date of this report, no audited financial statements have been prepared since the entities were either
newly incorporated in 2024 or have not started operation.
2.1 Basis of Preparation
The Historical Financial Information has been prepared in accordance with Hong Kong Financial Reporting
Standards (“HKFRSs”) which include all Hong Kong Financial Reporting Standards, Hong Kong Accounting
Standards (“HKASs”) and Interpretations issued by the HKICPA. All HKFRSs effective for the accounting period
commencing from 1 January 2025 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.
The Historical Financial Information has been prepared under the historical cost convention, except for certain
financial instruments which have been measured at fair value at the end of each of the Relevant Periods.
Notwithstanding that the Group recorded net current liabilities and net assets of RMB15,231,000 and
RMB144,791,000, respectively, as at 31 August 2025, the Historical Financial Information has been prepared on a
going concern basis. Redemption liabilities on ordinary shares with an amount of RMB138,481,000 were recorded
as current liabilities as at 31 August 2025, and the redemption feature of which will automatically ceased from the
date before the completion of an initial listing of the shares on the Stock Exchange. The directors of the Company
are of the opinion that the Company does not expect any outflow to settle the redemption liabilities in the next twelve
months from 31 August 2025 and will have sufficient working capital to meet its financial liabilities and obligations
as and when they fall due and to sustain its operations for the next twelve months from 31 August 2025 based on the
review of the Group’s projected cash flows.
Basis of consolidation
The Historical Financial Information includes the financial statements of the Group 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 Historical Financial information of the subsidiaries is 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.
Profit or loss and each component of other comprehensive income are attributed to the owners of the parent
of the Group and to the non-controlling interests, even if this results in the non-controlling interests having a deficit
balance. 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.
APPENDIX I ACCOUNTANTS’ REPORT
– I-17 –


--- page 575 ---
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.
2.2 Issued But Not Y et Effective Hong Kong Financial Reporting Standards
The Group has not applied the following new and revised HKFRSs, that have been issued but are not yet
effective, in this Historical Financial Information. The Group intends to apply these new and revised HKFRSs, if
applicable, when they become effective.
Amendments to HKFRS 9 and
HKFRS 7 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Amendments to the Classification and Measurement of Financial
Instruments
2
Amendments to HKFRS 9 and
HKFRS 7 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Contracts Referencing Nature-dependent Electricity 2
Amendments to HKFRS 10 and
HKAS 28 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Sale or Contribution of Assets between an Investor and its
Associate or Joint V enture 1
HKFRS 18 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Presentation and Disclosure in Financial Statements 3
HKFRS 19 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Subsidiaries without Public Accountability: Disclosures 3
Annual Improvements to HKFRS
Accounting Standards – V olume 11 /H1118/H1118
Amendments to HKFRS 1, HKFRS 7, HKFRS 9, HKFRS 10 and
HKAS 7 2
1 No mandatory effective date yet determined but available for adoption
2 Effective for annual periods beginning on or after 1 January 2026
3 Effective for annual periods beginning on or after 1 January 2027
The Group is in the process of making an assessment of the impact of these new and revised HKFRSs upon
initial application.
The application of HKFRS 18 will have no impact on the consolidated statements of financial position of the
Group, but will have impact on the presentation of the consolidated statements of profit or loss and other
comprehensive income. Except for HKFRS 18, the directors of the Company anticipate that the application of these
new and revised HKFRSs will have no material impact on the Group’s financial performance and financial position
in the foreseeable future.
2.3 Material Accounting Policies
Fair value measurement
The Group measures certain financial instruments at fair value at the end of each of the Relevant Periods. 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.
APPENDIX I ACCOUNTANTS’ REPORT
– I-18 –


--- page 576 ---
All assets and liabilities for which fair value is measured or disclosed in the financial statements 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
For assets and liabilities that are recognised in the Historical Financial Information on a recurring basis, the
Group determines whether transfers have occurred between levels in the hierarchy by reassessing categorisation
(based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each of
the Relevant Periods.
Impairment of non-financial assets
Where an indication of impairment exists, or when annual impairment testing for an asset is required (other
than deferred tax assets), 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.
In testing a cash-generating unit for impairment, a portion of the carrying amount of a corporate asset (e.g.,
a headquarters building) is allocated to an individual cash-generating unit if it can be allocated on a reasonable and
consistent basis or, otherwise, to the smallest group of cash-generating units.
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 Relevant 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.
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
APPENDIX I ACCOUNTANTS’ REPORT
– I-19 –


--- page 577 ---
(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; and the sponsoring employers of the post-employment benefit plan;
(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 (“CIP”), 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 estimated useful lives of property, plant and
equipment are as follows:
Plant and machinery /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183 to 10 years
Furniture and fixtures /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183 to 5 years
Motor vehicles /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185 years
Leasehold improvements /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Shorter of
lease term or
estimated
useful lives
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 each financial year end.
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 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.
APPENDIX I ACCOUNTANTS’ REPORT
– I-20 –


--- page 578 ---
Intangible assets (other than goodwill)
Intangible assets acquired separately are measured on initial recognition at cost. 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 each financial year end.
Software
Software is stated at cost less any impairment losses and is amortised on the straight-line basis over its
estimated useful life of 2 to 10 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:
Laboratory and office premises /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111814 months to 5 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.
(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. The lease payments also include the exercise
price of a purchase option reasonably certain to be exercised by the Group and payments of penalties for
termination of a lease, if the lease term reflects the Group exercising the option to terminate the lease. The
variable lease payments that do not depend on an index or a rate are recognised as an expense in the period
in which the event or condition that triggers the payment occurs.
APPENDIX I ACCOUNTANTS’ REPORT
– I-21 –


--- page 579 ---
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) or a change in assessment of an option to purchase the underlying
asset.
(c) Short-term leases and leases of low-value assets
The Group applies the short-term lease recognition exemption to its short-term leases (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). It also applies the recognition exemption for leases of low-value assets to leases of office equipment
and laptop computers that are considered to be of low value.
Lease payments on short-term leases and leases of low-value assets 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.
Subsequent measurement
The subsequent measurement of financial assets depends on their classification as follows:
Financial assets at amortised cost
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.
APPENDIX I ACCOUNTANTS’ REPORT
– I-22 –


--- page 580 ---
Financial assets at fair value through profit or loss
Financial assets at fair value through profit or loss are carried in the statement of financial position at fair value
with net changes in fair value recognised in profit or loss.
This category includes derivative instruments and equity investments which the Group had not irrevocably
elected to classify at fair value through other comprehensive income. Dividends on the equity investments are also
recognised as other income in profit or loss when the right of payment has been established.
A derivative embedded in a hybrid contract, with a financial liability or non-financial host, is separated from
the host and accounted for as a separate derivative if the economic characteristics and risks are not closely related
to the host; a separate instrument with the same terms as the embedded derivative would meet the definition of a
derivative; and the hybrid contract is not measured at fair value through profit or loss. Embedded derivatives are
measured at fair value with changes in fair value recognised in profit or loss. Reassessment only occurs if there is
either a change in the terms of the contract that significantly modifies the cash flows that would otherwise be required
or a reclassification of a financial asset out of the fair value through profit or loss category.
A derivative embedded within a hybrid contract containing a financial asset host is not accounted for
separately. The financial asset host together with the embedded derivative is required to be classified in its entirety
as a financial asset at fair value through profit or loss.
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).
APPENDIX I ACCOUNTANTS’ REPORT
– I-23 –


--- page 581 ---
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.
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 are subject to impairment under the general approach and they are classified
within the following stages for measurement of ECLs except for trade receivables which apply the simplified
approach as detailed below.
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 payables as appropriate.
All financial liabilities are recognised initially at fair value and, in the case of loans and borrowings and
payables, net of directly attributable transaction costs.
The Group’s financial liabilities include trade and other payables and lease liabilities.
Subsequent measurement
The subsequent measurement of financial liabilities depends on their classification as follows:
Financial liabilities at fair value through profit or loss
Financial liabilities at fair value through profit or loss include financial liabilities designated upon initial
recognition as at fair value through profit or loss.
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.
APPENDIX I ACCOUNTANTS’ REPORT
– I-24 –


--- page 582 ---
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.
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.
Redemption liabilities
For the redeemable ordinary shares issued by the Company and a subsidiary of the Company as detailed in
note 24, financial liabilities are recognized based on the amortised cost of the redemption amount and debited in
equity. Changes of the amortised cost during the Relevant Periods are recognized in profit or loss. When the
redemption rights related to the redeemable ordinary shares are terminated, the redemption liabilities on ordinary
shares are extinguished and credited to equity.
Cash and cash equivalents
Cash and cash equivalents in the statement 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.
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
the reporting period, 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
Relevant 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, 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
– I-25 –


--- page 583 ---
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, 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 reporting period 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 reporting period 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 the reporting period.
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.
Other income
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 a share option scheme and a restricted stock scheme. 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 for grants is measured by reference to the fair value at the date at which they are granted. The fair value
of the share option is determined by an external valuer by using binomial model, and the fair value of the restricted
stock is determined by an external valuer by using the back-solve method. Further details of which are given in note
27 to the Historical Financial Information.
The cost of equity-settled transactions is recognised in employee benefit expense, together with a
corresponding increase in equity, 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 reporting period 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 the statement of profit or loss for a period represents
the movement in the cumulative expense recognised as at the beginning and end of that period.
APPENDIX I ACCOUNTANTS’ REPORT
– I-26 –


--- page 584 ---
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. Market performance conditions are reflected within the
grant date fair value. Any other conditions attached to an award, but without an associated service requirement, are
considered to be non-vesting conditions. 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 operates in Mainland China are required to participate in a
central pension scheme operated by the local municipal government. This subsidiaries are required to contribute a
certain percentage of their payroll costs to the central pension scheme. The contributions are charged to the profit
or loss as they become payable in accordance with the rules of the central pension scheme.
Dividends
Final dividends are recognised as a liability when they are approved by the shareholders in a general meeting.
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 Historical Financial Information
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 the reporting period. 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.
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 the
Relevant Periods, the assets and liabilities of these entities are translated into RMB at the exchange rates prevailing
at the end of the reporting period and their statements of profit or loss are translated into RMB at the exchange rates
that approximate to those prevailing at the dates of the transactions.
APPENDIX I ACCOUNTANTS’ REPORT
– I-27 –


--- page 585 ---
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 the statement of profit or loss.
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.
Judgements
In the process of applying the Group’s accounting policies, management has made the following judgements,
apart from those involving estimations, which have the most significant effect on the amounts recognised in the
financial statements:
Research and development costs
All research costs are charged to profit or loss as incurred. Costs incurred on each pipeline to develop new
products are capitalised and deferred in accordance with the accounting policy for research and development costs
in note 2.3 to the Historical Financial Information. Determining the amounts to be capitalised requires management
to make judgments on the technical feasibility of existing pipelines to be successfully commercialised and bring
economic benefits to the Group.
Estimation uncertainty
The key assumptions concerning the future and other key sources of estimation uncertainty at the end of each
of the Relevant 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.
Leases — Estimating the incremental borrowing rate
The Group cannot readily determine the interest rate implicit in a lease, and therefore, it uses an incremental
borrowing rate (“IBR”) to measure lease liabilities. The IBR is the rate of interest that the Group would have to pay
to borrow over a similar term, and with a similar security, the funds necessary to obtain an asset of a similar value
to the right-of-use asset in a similar economic environment. The IBR therefore reflects what the Group “would have
to pay”, which requires estimation when no observable rates are available (such as for subsidiaries that do not enter
into financing transactions) or when it needs to be adjusted to reflect the terms and conditions of the lease (for
example, when leases are not in the subsidiary’s functional currency). The Group estimates the IBR using observable
inputs (such as market interest rates) when available and is required to make certain entity-specific estimates (such
as the subsidiary’s stand-alone credit rating).
Deferred tax assets
Deferred tax assets are recognized for unused tax losses to the extent that it is probable that taxable profit will
be available against which the losses can be utilized. Significant management estimation is required to determine the
amount of deferred tax assets that can be recognized, based upon the likely timing and level of future taxable profits
together with future tax planning strategies. Further details are given in note 23 to the Historical Financial Information.
Fair value of variable consideration arising from disposal of an associate
The fair value of variable consideration arising from disposal of an associate measured at FVTPL is determined
using valuation techniques, including the discounted cash flow method. Such valuation requires the Group to make
estimates of the key assumptions including the discount rate, which are subject to uncertainty.
The fair values of variable consideration arising from disposal of an associate as at 31 December 2023, 2024
and 31 August 2025 were RMB249,264,000 and RMB246,443,000 and RMB222,206,000, respectively. Further
details are included in note 19 to the Historical Financial Information.
APPENDIX I ACCOUNTANTS’ REPORT
– I-28 –


--- page 586 ---
Fair value of share-based payments transactions
Estimating the fair value of share-based payments transactions requires the determination of the most
appropriate valuation model, which depends on the terms and conditions of the grant. This estimate also requires the
determination of the most appropriate inputs to the valuation model including the expected life of the share option,
volatility and dividend yield and making assumptions about them.
For the measurement of the fair value of share-based payments transactions with employees at the grant date,
the Group uses binomial model and back-solve method. The assumptions and models used for estimating fair value
for share-based payments transactions are disclosed in note 27 to the Historical Financial Information.
Impairment of non-financial assets (other than goodwill)
The Group assesses whether there are any indicators of impairment for all non-financial assets (including the
right-of-use assets) at the end of each of the Relevant Periods. Other non-financial assets are tested for impairment
when there are indicators that the carrying amounts may not be recoverable. An impairment exists when the carrying
value of an asset or a cash-generating unit exceeds its recoverable amount, which is the higher of its fair value less
costs of disposal and its value in use. The calculation of the fair value less costs of disposal is based on available
data from binding sales transactions in an arm’s length transaction of similar assets or observable market prices less
incremental costs for disposing of the asset. When value in use calculations are undertaken, management must
estimate the expected future cash flows from the asset or cash-generating unit and choose a suitable discount rate in
order to calculate the present value of those cash flows.
4. OPERATING SEGMENT INFORMATION
Operating segment information
For management purposes, the Group has only one reportable operating segment, which is the research and
development of immuno-oncology 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 Mainland China, no geographical segment
information is presented in accordance with HKFRS 8 Operating Segments.
5. OTHER INCOME AND GAINS
An analysis of other income and gains, net is as follows:
Y ear ended 31 December Eight months ended 31 August
2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Bank interest income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,867 1,618 350 171
Interest income from structured
deposits and wealth management
products /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,258 1,306 917 156
Government grants* /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,539 2,199 231 75
Foreign exchange gains, net /H1118/H1118/H1118/H1118/H1118/H1118– 943 126 364
Fair value gains on FVTPL /H1118/H1118/H1118/H1118/H1118/H1118– 1,615 10,689 –
Other /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 1,860
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,664 7,681 12,313 2,626
* Government grants mainly represent various financial supports provided by the local governments for
the Group’s research and development activities and business operation. There are no contingencies
relating to these grants.
APPENDIX I ACCOUNTANTS’ REPORT
– I-29 –


--- page 587 ---
6. OTHER EXPENSES
An analysis of other expenses, net is as follows:
Y ear ended 31 December Eight months ended 31 August
2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Impairment losses on financial
assets under the ECL model,
net of reversal /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181 0 8–––
Fair value loss on variable
consideration arising from
disposal of an associate /H1118/H1118/H1118/H1118/H1118/H1118/H111833,002 – – 11,099
Fair value loss on structured
deposits and wealth management
products /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189 3–––
Foreign exchange losses, net /H1118/H1118/H1118/H1118/H11186 4 6–––
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111875 209 238 314
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111833,924 209 238 11,413
7. LOSS BEFORE TAX
Y ear ended 31 December Eight months ended 31 August
Notes 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Depreciation of property, plant and
equipment* /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111814 517 2,016 1,216 1,678
Depreciation of right-of-use assets* /H111815 491 3,352 2,247 2,242
Amortisation of other intangible
assets* /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111816 33 111 74 88
Lease payments not included in the
measurement of lease liabilities* /H111815 789 233 57 58
Auditor’s remuneration /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118185 285 143 162
Research and development costs /H1118/H1118/H111846,663 74,721 50,523 56,178
Employee benefit expense (including
directors’ and supervisors’
remuneration):*
Wages, salaries and allowances /H1118/H1118 16,376 18,503 15,463 13,643
Pension scheme contributions and
other social welfare /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,275 2,279 1,440 1,529
Equity-settled share-based
compensation expense /H1118/H1118/H1118/H1118/H1118/H1118/H111815,492 22,348 5,561 16,048
Listing expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 10,736 1,781 2,976
Foreign exchange losses/(gains), net /H11185,6 646 (943) (126) (364)
Interest expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188 2,280 9,379 5,853 7,532
Bank interest income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185 (1,867) (1,618) (350) (171)
Government grants /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185 (2,539) (2,199) (231) (75)
Interest income on structured
deposits and wealth management
products /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185 (2,258) (1,306) (917) (156)
Impairment losses on financial assets
under the ECL model, net of
reversal /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186 1 0 8–––
APPENDIX I ACCOUNTANTS’ REPORT
– I-30 –


--- page 588 ---
Y ear ended 31 December Eight months ended 31 August
Notes 2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Fair value losses/(gains) on variable
consideration arising from disposal
of an associate /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,6 33,002 (1,615) (10,689) 11,099
Fair value losses on structured
deposits and wealth management
products /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186 9 3–––
* The depreciation of property, plant and equipment, depreciation of right-of-use assets, amortisation of
other intangible assets, expense relating to short-term leases and employee benefit expenses for the
Relevant Periods are set out in “Administrative expenses” and “Research and development costs” in the
consolidated statements of profit or loss and other comprehensive income.
8. INTEREST EXPENSES
An analysis of finance costs from continuing operations is as follows:
Y ear ended 31 December Eight months ended 31 August
2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Interest from redemption liabilities /H1118/H1118/H11182,211 8,771 5,430 6,917
Interest expenses on lease liabilities /H1118/H111869 608 423 339
Interest on bank borrowings /H1118/H1118/H1118/H1118/H1118/H1118––– 2 7 6
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,280 9,379 5,853 7,532
9. DIRECTORS’, SUPERVISORS’ AND CHIEF EXECUTIVE’S REMUNERATION
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 Eight months ended 31 August
2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Fees /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118––––
Other emoluments:
Salaries, allowances and benefits in
kind /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,670 4,310 1,958 4,395
Performance related bonuses /H1118/H1118/H1118/H1118/H1118141 2,561 1,416 878
Share-based compensation /H1118/H1118/H1118/H1118/H1118/H1118/H1118– 11,295 2,979 9,030
Pension scheme contributions /H1118/H1118/H1118/H1118/H111882 162 49 96
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,893 18,328 6,402 14,399
(a) Independent non-executive directors
There were no fees and other emoluments payable to the independent non-executive directors during the
Relevant Periods.
APPENDIX I ACCOUNTANTS’ REPORT
– I-31 –


--- page 589 ---
(b) Executive directors, non-executive directors, supervisors and the chief executive
Y ear ended 31 December 2023
Notes Fees
Salaries,
allowances
and benefits
in kind
Performance
related
bonuses
Pension
scheme
contributions
Total
remuneration
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Executive directors:
Mr. Liu Min /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(iii) – 1,205 100 17 1,322
Supervisors:
Dr. Ke Hang /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(iv) – 465 41 65 571
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 1,670 141 82 1,893
Y ear ended 31 December 2024
Notes Fees
Salaries,
allowances
and benefits
in kind
Performance
related
bonuses
Share-based
payment
Pension
scheme
contributions
Total
remuneration
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Executive directors:
Dr. Zhang Faming /H1118/H1118/H1118(i) – 478 – 2,868 – 3,346
Dr. Li Henry Qixiang /H1118(ii) – 478 1,981 1,600 – 4,059
Mr. Liu Min /H1118/H1118/H1118/H1118/H1118/H1118(iii) – 1,500 125 5,797 22 7,444
Non-executive directors:
Dr. Li Jian /H1118/H1118/H1118/H1118/H1118/H1118/H1118(iv) ––––––
Ms. Xiao Jieyu /H1118/H1118/H1118/H1118/H1118(v) ––––––
Supervisors:
Dr. Ke Hang /H1118/H1118/H1118/H1118/H1118/H1118(vi) – 486 41 449 51 1,027
Ms. Sun Peng /H1118/H1118/H1118/H1118/H1118(vii) – 1,200 400 558 68 2,226
Ms. Chen Chen /H1118/H1118/H1118/H1118(viii) – 168 14 23 21 226
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 4,310 2,561 11,295 162 18,328
Eight months ended 31 August 2024 (unaudited)
Notes Fees
Salaries,
allowances
and benefits
in kind
Performance
related
bonuses
Share-based
payment
Pension
scheme
contributions
Total
remuneration
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Executive directors:
Dr. Zhang Faming /H1118/H1118/H1118(i) – 316 – 1,912 – 2,228
Dr. Li Henry Qixiang /H1118(ii) – 316 1,306 1,067 – 2,689
Mr. Liu Min /H1118/H1118/H1118/H1118/H1118/H1118(iii) – 1,006 83 – 15 1,104
Non-executive directors:
Dr. Li Jian /H1118/H1118/H1118/H1118/H1118/H1118/H1118(iv) ––––––
Ms. Xiao Jieyu /H1118/H1118/H1118/H1118/H1118(v) ––––––
Supervisors:
Dr. Ke Hang /H1118/H1118/H1118/H1118/H1118/H1118(vi) – 320 27 – 34 381
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 1,958 1,416 2,979 49 6,402
APPENDIX I ACCOUNTANTS’ REPORT
– I-32 –


--- page 590 ---
Eight months ended 31 August 2025
Notes Fees
Salaries,
allowances
and benefits
in kind
Performance
related
bonuses
Share-based
payment
Pension
scheme
contributions
Total
remuneration
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Executive directors:
Dr. Zhang Faming /H1118/H1118/H1118(i) – 790 – 2,796 7 3,593
Dr. Li Henry Qixiang /H1118(ii) – 1,068 489 1,317 7 2,881
Mr. Liu Min /H1118/H1118/H1118/H1118/H1118/H1118(iii) – 1,000 83 4,168 17 5,268
Non-executive directors:
Dr. Li Jian /H1118/H1118/H1118/H1118/H1118/H1118/H1118(iv) ––––––
Ms. Xiao Jieyu /H1118/H1118/H1118/H1118/H1118(v) ––––––
Supervisors:
Dr. Ke Hang /H1118/H1118/H1118/H1118/H1118/H1118(vi) – 353 30 323 7 713
Ms. Sun Peng /H1118/H1118/H1118/H1118/H1118(vii) – 1,067 267 401 45 1,780
Ms. Chen Chen /H1118/H1118/H1118/H1118(viii) – 117 9 25 13 164
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 4,395 878 9,030 96 14,399
Notes:
(i) Dr. Zhang Faming was appointed as a director of the Company on 1 March 2024.
(ii) Dr. Li Henry Qixiang was appointed as a director of the Company on 1 March 2024.
(iii) Mr. Liu Min was appointed as a director of the Company on 11 December 2022.
(iv) Dr. Li Jian was appointed as a director of the Company on 4 March 2024.
(v) Ms. Xiao Jieyu was appointed as a director of the Company on 1 March 2024.
(vi) Dr. Ke Hang was appointed as a supervisor of the Company on 13 December 2022.
(vii) Ms. Sun Peng was appointed as a supervisor of the Company on 8 October 2024.
(viii) Ms. Chen Chen was appointed as a supervisor of the Company on 8 October 2024.
10. FIVE HIGHEST PAID EMPLOYEES
The five highest paid employees during the years ended 31 December 2023, 2024 and the eight months ended
31 August 2024 and 2025 included one, four, four and three chief executive and directors respectively, details of
whose remuneration are set out in note 9 above. Details of the remuneration for the years ended 31 December 2023,
2024 and the eight months ended 31 August 2024 and 2025 of the remaining highest paid employees who are neither
a director nor chief executive of the Company are as follows:
Y ear ended 31 December Eight months ended 31 August
2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Salaries, allowances and benefits in kind /H1118 2,174 478 158 2,663
Performance related bonuses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,906 3,850 1,269 951
Equity-settled share option expense /H1118/H1118/H1118/H111815,492 1,280 853 8,441
Pension scheme contributions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183 5–– 1 8
23,607 5,608 2,280 12,073
APPENDIX I ACCOUNTANTS’ REPORT
– I-33 –


--- page 591 ---
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 Eight months ended 31 August
2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Nil to HKD1,000,000 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118––––
HKD1,000,001 to HKD2,000,000 /H1118/H1118/H1118––––
HKD2,000,001 to HKD3,000,000 /H1118/H1118/H11181–1–
HKD3,000,001 to HKD4,000,000 /H1118/H1118/H1118––––
HKD4,000,001 to HKD5,000,000 /H1118/H1118/H1118––––
HKD5,000,001 to HKD6,000,000 /H1118/H1118/H111811–1
HKD6,000,001 to HKD11,000,000 /H1118/H1118 2––1
HKD11,000,000 to HKD12,000,000 /H1118/H1118 ––––
4112
During the years ended 31 December 2023, 2024 and the eight months ended 31 August 2024 and 2025, share
options/RSUs were granted to 4, 1, 1 and 2 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 27 to the Historical
Financial Information. The fair value of such options/RSUs, which has been recognized in the profit or loss over the
vesting period, was determined as at the date of grant and the amount included in the Historical Financial Information
is included in the above non-director and non-chief executive highest paid employees’ remuneration disclosures.
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.
Hong Kong
The subsidiaries incorporated in Hong Kong are subject to income tax at the rate of 16.5% on the estimated
assessable profits arising in Hong Kong during the Relevant Periods.
Mainland China
Pursuant to the Corporate Income Tax Law of the PRC and the respective regulations (the “CIT Law”), the
subsidiaries which operate in Mainland China are subject to CIT at a rate of 25% on the taxable income.
Australia
The subsidiary incorporated in Australia is subject to Australia company tax at the statutory rate of 25% on
the estimated assessable profits arising in Australia during the Relevant Periods. No Australia company tax was
provided for as the subsidiary did not generate any assessable profits arising in Australia during the Relevant Periods.
APPENDIX I ACCOUNTANTS’ REPORT
– I-34 –


--- page 592 ---
USA
The subsidiary incorporated in Delaware, USA, is subject to statutory United States federal corporate income
tax at a rate of 21%. It is also subject to the state income tax at rates from 8.25% to 11.5% during the Relevant
Periods.
Y ear ended 31 December Eight months ended 31 August
2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Current income tax /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,052 5,805 (2,050) –
Deferred tax (note 23) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(10,315) (11,703) (9,947) (12,495)
Tax charge for the year/period /H1118/H1118/H1118/H1118(8,263) (5,898) (11,997) (12,495)
A reconciliation of the tax expense applicable to loss before tax using the statutory rate for the jurisdictions
in which the Company and its subsidiaries are domiciled to the tax expense at the effective tax rate, and a
reconciliation of the applicable rates (i.e., the statutory tax rates) to the effective tax rates, are as follows:
Y ear ended 31 December Eight months ended 31 August
2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Loss before tax /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(93,423) (122,820) (60,417) (99,933)
Tax at the statutory rate /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(23,356) (30,705) (15,104) (24,983)
At other rates enacted by local
authority /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111830 3,069 207 474
Additional deductible allowance for
qualified research and
development costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(6,688) (20,034) (25,508) (24,555)
Expenses not deductible for tax /H1118/H1118/H111891 38 2 5
Tax losses and deductible temporary
differences not recognised /H1118/H1118/H1118/H1118/H111821,660 41,734 28,406 36,564
Tax charge for the year/period /H1118/H1118/H1118/H1118(8,263) (5,898) (11,997) (12,495)
The Group has accumulated tax losses in Mainland China of RMB15,401,000, RMB33,748,000 and
RMB55,553,000 as at 31 December 2023, 2024 and 31 August 2025, respectively, which would expire in four to ten
years for offsetting against future taxable profits of the companies in which the losses arose.
The Group has nil accumulated tax losses in Australia as at 31 December 2023, 2024 and 31 August 2025, that
can be carried forward indefinitely to offset against future taxable profits of the company in which the loss was
incurred.
The Group has accumulated tax losses in Hong Kong of RMB181,000, RMB3,121,000 and RMB4,731,000 as
at 31 December 2023, 2024 and 31 August 2025, that can be carried forward indefinitely to offset against future
taxable profits of the company in which the loss was incurred.
The Group has unrecognised deductible temporary differences of RMB71,239,000, RMB97,858,000 and
RMB146,255,000 as at 31 December 2023, 2024 and 31 August 2025, respectively.
12. DIVIDENDS
No dividend was paid or declared by the Company during the Relevant Periods.
APPENDIX I ACCOUNTANTS’ REPORT
– I-35 –


--- page 593 ---
13. LOSS PER SHARE ATTRIBUTABLE TO ORDINARY EQUITY HOLDERS OF THE PARENT
On November 1, 2024, the Company was converted into a joint-stock limited liability company, and a total of
11,789,783 shares with a par value of RMB1.00 per share were issued and allocated to the respective shareholders
of the Company based on the registered paid-in capital as of that date.
The calculation of basic loss per share is based on the loss attributable to ordinary equity holders of the parent
company for the year and the weighted average number of ordinary shares outstanding during the Relevant Periods.
Since the diluted loss per share decreases when share-based payments are taken into account, these instruments had
an anti-dilutive effect on the basic loss per share amounts presented and were therefore excluded from the calculation
of diluted loss per share during the Relevant Periods. As a result, no adjustments have been made to the basic loss
per share amounts presented for the relevant periods for the purpose of calculating diluted earnings per share.
The calculation of basic and loss per share is based on:
Y ear ended 31 December Eight months ended 31 August
2023 2024 2024 2025
(unaudited)
Loss
Loss attributable to ordinary equity
holders of the parent for the
purpose of calculating basic and
diluted loss per share (RMB’000) /H1118 (76,056) (115,830) (47,953) (83,829)
Shares
Weighted average number of
ordinary shares in issue during the
year used in the basic and diluted
loss per share calculations /H1118/H1118/H1118/H1118/H11187,295,668 10,931,371 10,500,399 11,789,783
Loss per share (basic and diluted)
(RMB per share) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(10.42) (10.60) (4.57) (7.11)
14. PROPERTY, PLANT AND EQUIPMENT
The Group
Plant and
machinery
Furniture
and fixtures
Motor
vehicles
Construction
in progress Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
31 December 2023
At 1 January 2023
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,154 421 468 549 4,592
Accumulated depreciation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1,015) (182) (454) – (1,651)
Net carrying amount /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,139 239 14 549 2,941
At 1 January 2023, net of accumulated
depreciation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,139 239 14 549 2,941
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111816 44 – 6,405 6,465
Depreciation provided during the year /H1118/H1118(394) (123) – – (517)
Transfer to other intangible assets /H1118/H1118/H1118/H1118– – – (549) (549)
At 31 December 2023, net of
accumulated depreciation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,761 160 14 6,405 8,340
At 31 December 2023:
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,170 465 468 6,405 10,508
Accumulated depreciation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1,409) (305) (454) – (2,168)
Net carrying amount /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,761 160 14 6,405 8,340
APPENDIX I ACCOUNTANTS’ REPORT
– I-36 –


--- page 594 ---
Leasehold
improvements
Plant and
machinery
Furniture
and fixtures
Motor
vehicles
Construction
in progress Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
31 December 2024
At 1 January 2024
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 3,170 465 468 6,405 10,508
Accumulated depreciation /H1118/H1118– (1,409) (305) (454) – (2,168)
Net carrying amount /H1118/H1118/H1118/H1118/H1118/H1118– 1,761 160 14 6,405 8,340
At 1 January 2024, net of
accumulated depreciation /H1118 – 1,761 160 14 6,405 8,340
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 784 257 – 4,455 5,496
Depreciation provided during
the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1,459) (285) (272) – – (2,016)
Transfers /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188,202 – – – (8,202) –
At 31 December 2024, net of
accumulated depreciation /H11186,743 2,260 145 14 2,658 11,820
At 31 December 2024:
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188,202 3,954 722 468 2,658 16,004
Accumulated depreciation /H1118/H1118(1,459) (1,694) (577) (454) – (4,184)
Net carrying amount /H1118/H1118/H1118/H1118/H1118/H11186,743 2,260 145 14 2,658 11,820
Leasehold
improvements
Plant and
machinery
Furniture
and fixtures
Motor
vehicles
Construction
in progress Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
31 August 2025
At 1 January 2025
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188,202 3,954 722 468 2,658 16,004
Accumulated depreciation /H1118/H1118(1,459) (1,694) (577) (454) – (4,184)
Net carrying amount /H1118/H1118/H1118/H1118/H1118/H11186,743 2,260 145 14 2,658 11,820
At 1 January 2025, net of
accumulated depreciation /H11186,743 2,260 145 14 2,658 11,820
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 20 12 – 1,733 1,765
Depreciation provided during
the period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1,303) (287) (88) – – (1,678)
Transfers /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,310 – 429 – (3,739) –
At 31 August 2025, net of
accumulated depreciation /H11188,750 1,993 498 14 652 11,907
At 31 August 2025:
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111811,512 3,974 1,163 468 652 17,769
Accumulated depreciation /H1118/H1118(2,762) (1,981) (665) (454) – (5,862)
Net carrying amount /H1118/H1118/H1118/H1118/H1118/H11188,750 1,993 498 14 652 11,907
As at the end of each of the Relevant Periods, there were no pledged property, plant and equipment.
APPENDIX I ACCOUNTANTS’ REPORT
– I-37 –


--- page 595 ---
The Company
Leasehold
improvements
Plant and
machinery
Furniture
and fixtures
Construction
in progress Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
31 December 2023
At 1 January 2023
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 6,405 6,405
At 31 December 2023, net of accumulated
depreciation and impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 6,405 6,405
At 31 December 2023:
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 6,405 6,405
Net carrying amount /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 6,405 6,405
31 December 2024
At 1 January 2024
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 6,405 6,405
Net carrying amount /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 6,405 6,405
At 1 January 2024, net of accumulated
depreciation and impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 6,405 6,405
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 641 208 4,455 5,304
Depreciation provided during the year /H1118/H1118/H1118(1,459) (79) (72) – (1,610)
Transfers /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188,202 – – (8,202) –
At 31 December 2024, net of accumulated
depreciation and impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,743 562 136 2,658 10,099
At 31 December 2024:
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188,202 641 208 2,658 11,709
Accumulated depreciation and impairment /H1118(1,459) (79) (72) – (1,610)
Net carrying amount /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,743 562 136 2,658 10,099
31 August 2025
At 1 January 2025
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188,202 641 208 2,658 11,709
Accumulated depreciation and impairment /H1118(1,459) (79) (72) – (1,610)
Net carrying amount /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,743 562 136 2,658 10,099
At 1 January 2025, net of accumulated
depreciation and impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,743 562 136 2,658 10,099
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 20 12 1,733 1,765
Depreciation provided during the period /H1118/H1118(1,303) (80) (88) – (1,471)
Transfers /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,310 – 429 (3,739) –
At 31 August 2025, net of accumulated
depreciation and impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188,750 502 489 652 10,393
At 31 August 2025:
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111811,512 661 649 652 13,474
Accumulated depreciation and impairment /H1118(2,762) (159) (160) – (3,081)
Net carrying amount /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188,750 502 489 652 10,393
As at the end of each of the Relevant Periods, there were no pledged property, plant and equipment.
APPENDIX I ACCOUNTANTS’ REPORT
– I-38 –


--- page 596 ---
15. LEASES
The Group as a lessee
The Group has lease contracts for laboratory and office premises. Leases of properties generally have lease
terms between 14 months and 5 years. Generally, the Group is restricted from assigning and subleasing the leased
assets outside the Group.
(a) Right-of-use assets
The carrying amounts of the Group’s right-of-use assets and the movements during the Relevant Periods are
as follows:
The Group
Laboratory and
office premises
RMB’000
At 1 January 2023 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118438
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111815,714
Depreciation charge /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(491)
At 31 December 2023 and 1 January 2024 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111815,661
Depreciation charge /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(3,352)
At 31 December 2024 and 1 January 2025 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111812,309
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118458
Depreciation charge /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(2,242)
At 31 August 2025 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810,525
The Company
Laboratory and
office premises
RMB’000
At 1 January 2023 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111815,714
Depreciation charge /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(262)
At 31 December 2023 and 1 January 2024 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111815,452
Depreciation charge /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(3,143)
At 31 December 2024 and 1 January 2025 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111812,309
Depreciation charge /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(2,095)
At 31 August 2025 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810,214
APPENDIX I ACCOUNTANTS’ REPORT
– I-39 –


--- page 597 ---
(b) Lease liabilities
The carrying amount of lease liabilities and the movements during the Relevant Periods are as follows:
The Group
As at 31 December As at 31 August
2023 2024 2025
RMB’000 RMB’000 RMB’000
Carrying amount at the beginning of the year/period /H1118 409 15,031 11,831
New leases /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111815,714 – 458
Accretion of interest recognised during the
year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111869 608 339
Payments /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1,161) (3,808) (1,962)
Carrying amount at the end of the year/period /H1118/H1118/H1118/H1118/H111815,031 11,831 10,666
Analysed into:
Current portion /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,201 3,169 3,509
Non-current portion /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111811,830 8,662 7,157
The Company
As at 31 December As at 31 August
2023 2024 2025
RMB’000 RMB’000 RMB’000
Carrying amount at the beginning of the year/period /H1118 – 14,860 11,831
New leases /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111815,714 – –
Accretion of interest recognised during the
year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111855 605 328
Payments /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(909) (3,634) (1,818)
Carrying amount at the end of the year/period /H1118/H1118/H1118/H1118/H111814,860 11,831 10,341
Analysed into:
Current portion /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,030 3,169 3,265
Non-current portion /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111811,830 8,662 7,076
The maturity analysis of lease liabilities is disclosed in note 33 to the Historical Financial Information.
The amounts recognised in profit or loss in relation to leases are as follows:
The Group
Y ear ended 31 December Eight months ended 31 August
2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Interest on lease liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111869 608 423 339
Depreciation charge of right-of-use assets /H1118 491 3,352 2,247 2,242
Expense relating to short-term leases /H1118/H1118/H1118/H1118735 145 51 51
Expense relating to leases of
low-value assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111854 88 6 7
Total amount recognised in profit
or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,349 4,193 2,727 2,639
APPENDIX I ACCOUNTANTS’ REPORT
– I-40 –


--- page 598 ---
16. OTHER INTANGIBLE ASSETS
Software
RMB’000
31 December 2023
At 1 January 2023 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111842
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118549
Amortisation provided during the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(33)
At 31 December 2023 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118558
At 31 December 2023:
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118643
Accumulated amortisation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(85)
Net carrying amount /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118558
31 December 2024
At 1 January 2024, net of accumulated amortisation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118558
Amortisation provided during the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(111)
At 31 December 2024 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118447
At 31 December 2024:
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118643
Accumulated amortisation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(196)
Net carrying amount /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118447
31 August 2025
At 1 January 2025, net of accumulated amortisation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118447
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118228
Amortisation provided during the period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(88)
At 31 August 2025 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118587
At 31 August 2025:
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118871
Accumulated amortisation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(284)
Net carrying amount /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118587
17. INVESTMENT IN SUBSIDIARIES
The Company
As at 31 December As at 31 August
Notes 2023 2024 2025
RMB’000 RMB’000 RMB’000
Unlisted shares, at cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(a) 78,438 78,438 78,438
Note:
(a) Particulars of the subsidiaries of the Company are set out in note 1 of this section.
APPENDIX I ACCOUNTANTS’ REPORT
– I-41 –


--- page 599 ---
18. PREPAYMENTS, OTHER RECEIV ABLES AND OTHER ASSETS
The Group
As at 31 December As at 31 August
Notes 2023 2024 2025
RMB’000 RMB’000 RMB’000
Prepayments /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(a) 12,172 18,541 16,894
Receivables arising from disposal of an
associate /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(b) 75,000 35,000 –
Deferred listing expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 2,684 6,710
Tax recoverable /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,522 9,761 13,650
Deposits and other receivables /H1118/H1118/H1118/H1118/H1118/H1118/H11181,737 3,080 1,088
Amounts due from related parties /H1118/H1118/H1118/H1118/H1118– 172 –
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111894,431 69,238 38,342
Analysed into:
Current portion /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111893,900 68,908 38,012
Non-current portion /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118531 330 330
The Company
As at 31 December As at 31 August
Note 2023 2024 2025
RMB’000 RMB’000 RMB’000
Prepayments /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(a) 4,031 4,687 6,699
Deposits and other receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118424 2,242 3,534
Deferred listing expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 2,684 6,710
Tax recoverable /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,241 3,752 5,187
Amounts due from subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118/H111830,323 19,436 31,472
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111836,019 32,801 53,602
Analysed into:
Current portion /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111835,488 32,801 53,602
Non-current portion /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185 3 1––
Notes:
(a) Prepayments represent advances to certain major suppliers for the purchase of goods or services.
(b) In September 2019, Hangzhou Hanx entered into an equity transfer agreement with Lepu Biopharma
Co., Ltd. (ʮ̡) (“Lepu”) to transfer its 40% equity interests in Taizhou
Hanzhong Biopharmaceutical Co., Ltd. (ʮ̡) (“Taizhou Hanzhong”), an
associate of Hangzhou Hanx, at (i) a fixed consideration of RMB350,000,000 which is settled in cash;
and (ii) a variable consideration of 4.375% of the annual net sales revenue of PD-1 products after its
commercialisation. The payment of the fixed consideration and the transfer of Taizhou Hanzhong’s
equity interests are non-cancellable and to be settled in stages.
RMB210,000,000, RMB65,000,000, RMB40,000,000 of the fixed consideration have been received
before 2023 and during 2023 and 2024, respectively. In August 2024, Hangzhou Hanx entered into a
supplement agreement with Lepu to specify that Lepu will make the remaining payment of
RMB75,000,000 no later than June 2025. In September 2024, RMB40,000,000 has been received. In
July 2025, RMB35,000,000 has been received. RMB13,138,000 was based on the 4.375% of 2024
annual net sales revenue of PD-1 products from Lepu has been received too.
APPENDIX I ACCOUNTANTS’ REPORT
– I-42 –


--- page 600 ---
The variable consideration was recognized as financial assets at fair value through profit or loss. The
Group estimated that the fair value of the variable consideration amounted to RMB249,264,000,
RMB246,443,000 and RMB222,206,000 as at 31 December 2023, 2024 and 31 August 2025 (note 19),
respectively, and the subsequent change was recognised in profit or loss.
As at the end of each of the Relevant Periods, other receivables of the Group are considered to have low
credit risk and thus the Group has assessed that the ECL for other receivables is immaterial under the
12-month expected credit loss method.
Details of amounts due from related parties are set out in note 30.
19. FINANCIAL ASSETS AT FAIR V ALUE THROUGH PROFIT OR LOSS
The Group
As at 31 December As at 31 August
2023 2024 2025
RMB’000 RMB’000 RMB’000
V ariable consideration arising from disposal of
an associate /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118249,264 246,443 222,206
Structured deposits and wealth management
products /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111835,470 – 10,731
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118284,734 246,443 232,937
Analysed into:
Current portion /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111842,361 12,665 22,837
Non-current portion /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118242,373 233,778 210,100
The Company
As at 31 December As at 31 August
2023 2024 2025
RMB’000 RMB’000 RMB’000
Structured deposits /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810,000 – –
The structured deposits are purchased from creditworthy commercial banks in Mainland China. They were
mandatorily classified as financial assets at fair value through profit or loss as their contractual cash flows are not
solely payments of principal and interest.
20. CASH AND CASH EQUIV ALENTS AND PLEDGED DEPOSITS
The Group
As at 31 December As at 31 August
2023 2024 2025
RMB’000 RMB’000 RMB’000
Cash and bank balances /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118158,150 161,214 150,000
Time deposits /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111824,366 – –
182,516 161,214 150,000
Less: Pledged deposits (i) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185 0 0––
Long-term time deposits /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111820,016 – –
Cash and cash equivalents /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118162,000 161,214 150,000
APPENDIX I ACCOUNTANTS’ REPORT
– I-43 –


--- page 601 ---
As at 31 December As at 31 August
2023 2024 2025
RMB’000 RMB’000 RMB’000
Denominated in RMB /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118140,117 134,842 125,254
Denominated in USD /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111820,850 24,994 24,367
Denominated in AUD /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,001 1,369 11
Denominated in HKD /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111832 9 368
Cash and cash equivalents /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118162,000 161,214 150,000
(i) It represents pledged deposits in commercial banks. None of these deposits are either past due or
impaired.
The RMB is not freely convertible into other currencies, however, under Mainland China’s Foreign
Exchange Control Regulations and Administration of Settlement, and 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.
Short-term time deposits are with terms of less than one year and earn interest at the respective
short-term time deposit rates. Cash at banks earns interest at floating rates based on daily bank deposit
rates. The bank balances are deposited with creditworthy banks with no history of default. The carrying
amounts of the cash and bank balances approximate to their fair values.
Long-term time deposits at banks are deposits with original maturities of three years and earn interest
at a fixed rate of 2.90% and were withdrawn in October 2024. The bank balances are deposited with
creditworthy banks with no recent history of default.
The Company
As at 31 December As at 31 August
2023 2024 2025
RMB’000 RMB’000 RMB’000
Cash and bank balances /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111815,667 38,956 36,287
Denominated in RMB /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188,781 38,259 35,598
Denominated in USD /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,886 697 689
Cash and cash equivalents /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111815,667 38,956 36,287
21. TRADE PAYABLES
An ageing analysis of the trade payables as at the end of each of the Relevant Periods, based on the invoice
date, is as follows:
As at 31 December As at 31 August
2023 2024 2025
RMB’000 RMB’000 RMB’000
Within 1 year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189,735 3,450 11,158
1 to 2 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,887 7,691 4,346
2 to 3 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118312 983 552
Over 3 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182 169 169
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111812,936 12,293 16,225
The trade payables are non-interest-bearing and are normally settled on terms of 10 to 30 days.
APPENDIX I ACCOUNTANTS’ REPORT
– I-44 –


--- page 602 ---
22. OTHER PAYABLES AND ACCRUALS
The Group
As at 31 December As at 31 August
2023 2024 2025
RMB’000 RMB’000 RMB’000
Payables arising from acquisition of non-
controlling interests* /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111831,244 31,244 –
Government grants to be recognised** /H1118/H1118/H1118/H1118/H1118/H1118/H11184,000 4,000 4,000
Payroll payable /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,559 2,802 2,263
Payables for purchase of property, plant and
equipment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,684 970 196
Accrued listing expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 2,758 3,776
Other payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118180 659 257
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111839,667 42,433 10,492
The Company
As at 31 December As at 31 August
2023 2024 2025
RMB’000 RMB’000 RMB’000
Payables arising from acquisition of non-
controlling interests /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111831,244 31,244 –
Payroll payable /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118875 1,263 780
Accrued listing expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 2,758 3,776
Payables for purchase of property, plant and
equipment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,684 970 196
Amounts due to subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118400 51,453 79,453
Other payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111865 136 165
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111834,268 87,824 84,370
* Payments of RMB4,500,000 and RMB26,744,000 were made to Hangzhou Ganming Investment
Management Partnership (Limited Partnership) on January 21, 2025, and March 3, 2025, respectively.
** Hangzhou Hanx has been selected for the Hangzhou Hi-Tech Zone “5050 Plan”, enjoying certain policy
support and service. Hangzhou Hanx’s promises to the local government include, among others,
remaining in the Hangzhou Hi-Tech Zone, not reducing capital and not changing its capital structure.
In the absence of exemption from certain warranties, Hangzhou Hanx may be subject to recovery of
funding and compensation for losses incurred due to its breach. The RMB4,000,000 received was
recognised as refund liabilities.
APPENDIX I ACCOUNTANTS’ REPORT
– I-45 –


--- page 603 ---
23. DEFERRED TAX
The movements in deferred tax assets and liabilities during the Relevant Periods are as follows:
Deferred tax assets
Losses available for
offsetting against
future taxable
profits Leases liabilities Total
RMB’000 RMB’000 RMB’000
At 1 January 2023 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,891 101 5,992
Deferred tax credited/(charged) to profit or loss
during the year (note 11) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(5,891) 3,657 (2,234)
At 31 December 2023 and 1 January 2024 /H1118/H1118/H1118/H1118/H1118– 3,758 3,758
Deferred tax credited/(charged) to profit or loss
during the year (note 11) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,832 (800) 5,032
At 31 December 2024 and 1 January 2025 /H1118/H1118/H1118/H1118/H11185,832 2,958 8,790
Deferred tax credited/(charged) to profit or loss
during the period (note 11) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(5,020) (89) (5,109)
At 31 August 2025 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118812 2,869 3,681
Deferred tax liabilities
Gains arising
from disposal of
an associate
Fair value
adjustments
arising from
disposal of an
associate
Right of use
assets Total
RMB’000 RMB’000 RMB’000 RMB’000
At 1 January 2023 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111835,938 70,727 110 106,775
Deferred tax credited to the
statement of profit or loss during
the year (note 11) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(7,946) (8,411) 3,808 (12,549)
At 31 December 2023 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111827,992 62,316 3,918 94,226
Deferred tax credited to the
statement of profit or loss during
the year (note 11) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(5,125) (705) (841) (6,671)
At 31 December 2024 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111822,867 61,611 3,077 87,555
Deferred tax credited to the
statement of profit or loss during
the period (note 11) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(11,099) (6,059) (446) (17,604)
At 31 August 2025 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111811,768 55,552 2,631 69,951
APPENDIX I ACCOUNTANTS’ REPORT
– I-46 –


--- page 604 ---
For presentation purposes, certain deferred tax assets and liabilities have been offset in the statement of
financial position. The following is an analysis of the deferred tax balances of the Group for financial reporting
purposes:
As at 31 December As at 31 August
2023 2024 2025
RMB’000 RMB’000 RMB’000
Net deferred tax liabilities recognised in the
consolidated statement of financial position /H1118/H1118/H111890,468 78,765 66,270
Deferred tax assets have not been recognised in respect of the following items:
As at 31 December As at 31 August
2023 2024 2025
RMB’000 RMB’000 RMB’000
Tax losses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111815,582 36,869 60,284
Deductible temporary differences /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111871,058 71,670 79,783
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111886,640 108,539 140,067
24. REDEMPTION LIABILITIES ON ORDINARY SHARES
As at 31 December As at 31 August
2023 2024 2025
RMB’000 RMB’000 RMB’000
Series A /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,000 5,000 5,000
Series B /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111891,379 91,379 91,379
Series B+ /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 21,305 21,305
Interest payable related to redemption liabilities /H1118 5,109 13,880 20,797
101,488 131,564 138,481
In 2017, Hangzhou Hanx, a subsidiary of the Company, completed Series A financing, one of the Series A
Investors is Betta Pharmaceuticals Co., Ltd., (“Betta Pharmaceuticals”). Betta Pharmaceuticals subscribed for
approximately 7.14% equity interests in Hangzhou Hanx at a consideration of RMB5 million. In 2023, the Company
entered into an asset reorganization agreement (the “Asset Reorganization Agreement”) with Series A Investors, Betta
Pharmaceuticals agreed to transfer its 6.25% equity interests in Hangzhou Hanx to the Company.
In 2023, Series B Investors agreed to subscribe for approximately RMB0.78 million registered capital in our
Company at a total consideration of approximately RMB91.38 million.
In 2024, Y angtze Investment (HK) Limited, agreed to subscribe for approximately RMB0.78 million registered
capital in our Company at a total consideration of approximately RMB10.65 million. Hanx Biopharmaceuticals (HK)
transferred 0.87% of its equity of the Company with registered capital of RMB0.1 million to Hainan Y angzi
Investment Co., Ltd (“Hainan Y angzi”) for a total consideration of approximately RMB10.65 million after which
Hainan Y angzi owns the same right of redemption as other Investors.
APPENDIX I ACCOUNTANTS’ REPORT
– I-47 –


--- page 605 ---
Significant terms of the equity interests above that will impact the accounting treatment of the Group are
outlined below:
(a) Redemption features
In the event that the Company fails to consummate a Qualified Public Offering on or prior to 1 January 2028
(the “Closing Date”) then the investment from the Series A, B and B+ Investors shall have the right, but not the
obligation, by sending a written notice (the “Redemption Notice”) to the Company, to request the Company to redeem
all or a portion of the then outstanding Preferred Shares held by such Preferred Shareholder (the “Redemption Share”)
(each such requesting Preferred Shareholder, a “Requesting Holder”).
Besides, on or prior to December 31, 2026 in the event that (i) the HX009 project-related drugs fail to submit
a New Drug Application (NDA) or a Biologic License Application (BLA) to the National Medical Products
Administration (NMPA) or the U.S. Food and Drug Administration (FDA), (ii) the HX301 project-related drugs fail
to submit a NDA to NMPA and (iii) the Company fails to complete financing of no less than RMB50,000,000 at a
pre-investment valuation of RMB2.2 billion, Wuhan Donggaorensi Equity Investment Partnership (Limited
Partnership) (ᛆҳ༟ΥྫΆุ(Υྫ) and an individual Investor Ms. Xiao shall also have the
right to request the Company to redeem all or a portion of the then Redemption Share.
Each Requesting Holder is entitled to receive, with respect to each of its respective Redemption Shares, an
amount (the “Preferred Shareholder Preference Amount”) equal to the higher amount of (a) sum of the Preferred
Share Original Issue Price plus an interest accrued at a simple interest rate of 8% per annum on the Preferred Share
Original Issue Price for the period starting from (and including) the applicable Closing Date until (and including) the
Redemption Date and, (b) the book value of the equity interest of the Company by the Preferred Shareholder as of
the Closing Date.
Pursuant to a termination agreement entered into among the Shareholders and the Company relating to such
special rights dated 22 November 2024, the redemption right ceased to be effective from the day before the date of
the first submission of the first listing application form for the Listing and all other special rights ceased to be
effective upon Listing provided that all such special rights shall be automatically reinstated as if the termination of
such rights had never taken place in the event where (i) the Company withdraws its application for the public offering,
(ii) the Stock Exchange, the Securities and Futures Commission (SFC) or any competent securities regulatory
authority has decided not to approve or to reject the listing application of the Company or otherwise terminate the
listing application review procedure, or (iii) the Company fails to complete the public offering before 31 December
2025.
(b) Presentation and Classification
The redemption obligations give rise to financial liabilities, which are measured at the net present value of the
redemption amount. Pursuant to the agreement signed in 2023, the trigger condition would be taken place in the event
where the Company fails to complete the public offering before 1 January 2028. Pursuant to the termination
agreement entered into among the Shareholders and the Company relating to such special rights dated 22 November
2024, the redemption right would be triggered in the event where the Company fails to complete the public offering
before 31 December 2025. Therefore, the redemption liabilities in 2024 and eight months ended 31 August 2025 were
classified as current liabilities, while those in 2023 were classified as non-current liabilities.
The movements in redemption liabilities on ordinary shares of the Group during the Relevant Periods are as
follows:
Series A Series B Series B+
Interest
payable Total Shares
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
At 1 January 2023 /H1118/H1118/H1118/H1118/H1118/H11185,000 – – 2,898 7,898
Recognition of redemption
liabilities on Series A
Shares and Series B
Shares /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 91,379 – 2,211 93,590
At 31 December 2023 /H1118/H1118/H11185,000 91,379 – 5,109 101,488
APPENDIX I ACCOUNTANTS’ REPORT
– I-48 –


--- page 606 ---
Series A Series B Series B+
Interest
payable Total Shares
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Recognition of redemption
liabilities on Series B+
Shares /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 21,305 629 21,934
Recognition of redemption
liabilities on Series A
Shares and Series B
Shares /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 8,142 8,142
At 31 December 2024 /H1118/H1118/H11185,000 91,379 21,305 13,880 131,564
Recognition of redemption
liabilities on Series A
Shares, Series B Shares
and Series B+ /H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 6,917 6,917
At 31 August 2025 /H1118/H1118/H1118/H1118/H11185,000 91,379 21,305 20,797 138,481
25. PAID-IN CAPITAL/SHARE CAPITAL
Pursuant to the shareholders’ resolutions dated 8 October 2024, the then existing shareholders of the Company
approved the conversion of the Company into a joint stock company with limited liabilities with 11,789,783 shares
in a nominal value of RMB1.0 each. The net assets of the Company as of 31 August 2024 under PRC GAAP audited
by an independent auditor were converted to 11,789,783 ordinary shares at RMB1.0 each and issued to the then
shareholders of the Company in proportion to their capital contribution to the Company. The remaining amount was
converted into share premium. Upon the completion of registration with the Administration for Market Regulation
of the Hubei (̹ఙ္ຖ၍ଣ҅) on 1 November 2024, the Company was converted into a joint stock company
with limited liability.
A summary of movements in the Company’s paid-in capital is as follows:
Notes Total
RMB’000
As at 1 January 2023 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,600
Increase of paid-in capital upon reorganization and acquisition of
non-controlling interests /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(a) 3,215
Capital injection by settlement of liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(b) 1,930
Capital injection /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(c) 780
At 31 December 2023 and 1 January 2024 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189,525
Capital injection /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(d) 2,265
As at 31 December 2024, 1 January 2025 and 31 August 2025 /H1118/H1118/H1118/H1118/H1118/H111811,790
Notes:
(a) In January 2023, the Company entered into an asset reorganisation agreement (the “Asset
Reorganisation Agreement”) with Beijing Lapam Biopharmaceutical V enture Capital Center (Limited
Partnership) (ᔼᖹ௴ุҳ༟ʕː(Υྫ)) (“Beijing Lapam”), Betta Pharmaceuticals
Co., Ltd. (ʮ̡) (“Betta Pharmaceuticals”), Hangzhou Hongye Ruiji Investment
Partnership (Limited Partnership) (ุြΛҳ༟ΥྫΆุ(Υྫ)) (“Hangzhou Hongye
Ruiji”), Hangzhou Ganming Investment Management Partnership (Limited Partnership) (ҳ༟
၍ଣΥྫΆุ(Υྫ)) (“Hangzhou Ganming”), Cai Zhang Biotechnology (Hangzhou) Co., Ltd.* ( ᇹ
Ҧ(ψ)ப΂ʮ̡) (“CZ Biotechnology”) and Hangzhou Hanx. as set out in the paragraph
headed “Investment by Series A Investors” in the section headed “History, Development and Corporate
Structure” in this Prospectus.
APPENDIX I ACCOUNTANTS’ REPORT
– I-49 –


--- page 607 ---
Pursuant to the Asset Reorganisation Agreement, (i) Hangzhou Ganming agreed to transfer its 26.25%
equity interests in Hangzhou Hanx to the Company at a cash consideration of RMB33,174,000; (ii)
Beijing Lapam agreed to transfer its 12.5% equity interests in Hangzhou Hanx to the Company at a
consideration of RMB16,510,000, which was settled by the subscription of 14.71% equity interests in
the Company; (iii) Hangzhou Hongye Ruiji agreed to transfer its 12.5% equity interests in Hangzhou
Hanx to the Company at a consideration of RMB16,510,000, which was settled by the subscription of
14.71% equity interests in the Company; and (iv) Betta Pharmaceuticals agreed to transfer its 6.25%
equity interests in Hangzhou Hanx to the Company at a consideration of RMB8,250,000, which was
settled by the subscription of 7.35% equity interests in the Company. The paid-in capital and capital
reserve of the Company to acquire the non-controlling interests above is amounted to RMB3,215,000
and RMB219,119,000, respectively. Upon completion of the above transaction, the Company owned as
to 85% of Hangzhou Hanx.
(b) In November 2018, CZ Biotechnology provided up to RMB1,900,000 loans to Hangzhou Ganming with
an interest rate of 0.5% per annum. In April 2023, CZ Biotechnology transferred the loan to the
Company at a consideration of RMB1,930,000 and the loan was converted to paid-in capital.
(c) In May 2023, the Company entered into an investment agreement with Wuhan Donggaorensi Equity
Investment Partnership (Limited Partnership) (ᛆҳ༟ΥྫΆุ(Υྫ)) (“Wuhan
Donggaorensi”), Hangzhou Taikun Equity Investment Fund Partnership (Limited Partnership) (ψइ
ΥྫΆุ(Υྫ)) (“Hangzhou Taikun”), Tibet Lapam Small and Medium Enterprise
Development Fund Equity Investment Partnership (Limited Partnership) (ٰږ
ᛆҳ༟Υྫ(Υྫ)) (“Tibet Lapam”), Lapam Capital HK Co., Limited (“Lapam Capital”), and Ms.
Xiao Jieyu, pursuant to which total registered capital of RMB780,000 of the Company was subscribed
by the above investors with a total consideration of RMB91,381,000 and the difference of
RMB90,601,000 was credited to capital reserve.
(d) In May 2023, Hanx Biopharmaceuticals (HK) (“Hanx HK”), one of the employee shareholding
platforms of the Group, subscribed for approximately 20% equity interests in the Company.
USD307,714 (equivalent to RMB2,186,000) was received in May 2024. On June 12, 2024, Hainan
Y angtze entered into an equity transfer agreement with Hanx HK, Dr. Zhang, CZ Biotechnology and the
Company, pursuant to which Hanx HK agreed to transfer approximately 0.87% equity interests in the
Company to Hainan Y angtze at a consideration of approximately RMB10.65 million. On June 15, 2024,
Y angtze Hong Kong entered into a subscription agreement with Hainan Y angtze, Series A Investors,
Series B Investors, Hanx HK, CZ Biotechnology, Dr. Zhang and the Company. Pursuant to the
subscription agreement, Y angtze Hong Kong agreed to subscribe for approximately 0.66% equity
interests in our Company in an amount of RMB10.65 million. On October 8, 2024, Ms. Xiao Jieyu
entered into share transfer agreements with Mr. Liao Tong and Mr. Zou Zhiyong separately, pursuant to
which Ms. Xiao transferred: (i) 2,135 Unlisted Shares (equivalent to RMB2,135 equity interests in our
Company before the Conversion) to Mr. Liao; and (ii) 171 Unlisted Shares (equivalent to RMB171
equity interests in our Company before the Conversion) to Mr. Zou Zhiyong at nil consideration to
unwind the nominee shareholding arrangement between Ms. Xiao Jieyu and Mr. Liao Tong and Mr. Zou
Zhiyong.
26. RESERVES
The Group
The amounts of the Group’s reserves and the movements therein for the Relevant Periods are presented in the
consolidated statements of changes in equity of the Group.
(a) Capital reserve
The capital reserve represents share premium of the Group, the reserve arising pursuant to the acquisition of
non-controlling interests, capital reorganisation and issue of shares. Details of the movements in capital reserve are
set out in the consolidated statements of changes in equity of the Historical Financial Information.
(b) Exchange fluctuation reserve
The exchange fluctuation reserve is used to record exchange differences arising from the translation of the
financial statements of entities of which the functional currency is not RMB.
APPENDIX I ACCOUNTANTS’ REPORT
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(c) Share-based payment reserve
The share-based payment reserve represents the equity-settled share awards.
The Company
Y ear ended 31 December 2023
Paid-in capital/
Share capital Capital reserve Other reserves
Accumulated
losses Total equity
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
At 1 January 2023 /H1118/H1118/H1118/H1118/H1118/H11183,600 – – (265) 3,335
Loss for the year /H1118/H1118/H1118/H1118/H1118/H1118– – – (16,873) (16,873)
Acquisition of non-
controlling interests /H1118/H1118/H11183,215 38,049 – – 41,264
Capital injection /H1118/H1118/H1118/H1118/H1118/H1118/H1118780 90,601 – – 91,381
Capital injection by
settlement of liabilities /H1118 1,93 0––– 1,930
Redemption liabilities from
Series A and B shares /H1118/H1118– – (91,379) – (91,379)
At 31 December 2023 /H1118/H1118/H11189,525 128,650 (91,379) (17,138) 29,658
Y ear ended 31 December 2024
Paid-in
capital/
Share capital
Capital
reserve Other reserves
Share-based
payment
reserve
Accumulated
losses Total Equity
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
At 1 January 2024 /H1118/H1118/H1118/H1118/H1118/H11189,525 128,650 (91,379) – (17,138) 29,658
Loss for the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – – (104,141) (104,141)
Capital injection /H1118/H1118/H1118/H1118/H1118/H1118/H11182,265 10,57 7––– 12,842
Equity-settled share-based
payment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 22,348 – 22,348
Redemption liabilities from
Series B+ shares /H1118/H1118/H1118/H1118/H1118/H1118– – (21,305) – – (21,305)
Conversion into a joint stock
company (note 26) /H1118/H1118/H1118/H1118– (42,919) – – 42,919 –
At 31 December 2024 /H1118/H1118/H1118/H111811,790 96,308 (112,684) 22,348 (78,360) (60,598)
Eight months ended 31 August 2024
Paid-in
capital/
Share capital
Capital
reserve Other reserves
Share-based
payment
reserve
Accumulated
losses Total Equity
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
At 1 January 2024 /H1118/H1118/H1118/H1118/H1118/H11189,525 128,650 (91,379) – (17,138) 29,658
Loss for the period /H1118/H1118/H1118/H1118/H1118/H1118– – – – (20,982) (20,982)
Capital injection /H1118/H1118/H1118/H1118/H1118/H1118/H11182,265 10,57 7––– 12,842
Equity-settled share-based
payment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 5,561 – 5,561
Redemption liabilities from
Series B+ shares /H1118/H1118/H1118/H1118/H1118/H1118– – (21,305) – – (21,305)
At 31 August 2024
(unaudited) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111811,790 139,227 (112,684) 5,561 (38,120) 5,774
APPENDIX I ACCOUNTANTS’ REPORT
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Eight months ended 31 August 2025
Paid-in
capital/
Share capital
Capital
reserve Other reserves
Share-based
payment
reserve
Accumulated
losses Total Equity
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
At 1 January 2025 /H1118/H1118/H1118/H1118/H1118/H111811,790 96,308 (112,684) 22,348 (78,360) (60,598)
Loss for the period /H1118/H1118/H1118/H1118/H1118/H1118– – – – (52,363) (52,363)
Equity-settled share-based
payment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 16,048 – 16,048
At 31 August 2025 /H1118/H1118/H1118/H1118/H1118/H111811,790 96,308 (112,684) 38,396 (130,723) (96,913)
27. SHARE INCENTIVE PLAN
2022 Share Incentive Plan
Pursuant to the written resolutions of the shareholders of the Company passed in January 2022, the board of
directors of Hangzhou Hanx Biopharmaceuticals Ltd. (“Hangzhou Hanx”), a subsidiary of the Company established
in the PRC, passed a resolution to adopt share incentive plan for senior executives (the “2022 Share Incentive Plan”)
to promote the success of the Group and to incentivize senior executives of the Group. During the year ended 31
December 2022, Hangzhou Hanx granted share options and restricted share units (“RSUs”) to eligible senior
executives of the Group.
Pursuant to the 2022 Employee Incentive Plan, Hangzhou Hanx granted a total of 11,027,549 share options and
2,250,000 RSUs to certain employees of the Group.
2022 RSU Plan
Pursuant to the 2022 Share Incentive Plan, 2,250,000 RSUs were granted in January 2022 to eligible
participants at the subscription price of USD0.15 per share (“2022 RSU Plan”). All RSUs were granted to the senior
executives in January 2022 with no vesting conditions.
The following RSUs were outstanding under the 2022 Share Incentive Plan during the Relevant Periods.
Number of RSU
As at 1 January 2023 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,250,000
Granted during the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–
As at 31 December 2023 and 1 January 2024 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,250,000
Granted during the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–
As at 31 December 2024 and 1 January 2025 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,250,000
Granted during the period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–
As at 31 August 2025 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,250,000
The fair value of RSUs at grant date were estimated at RMB28.17/unit as at the date of grant by reference to
recent financing valuation of the Group.
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 610 ---
The Back-solve Method was used to determine the underlying equity fair value of the RSUs and the equity
allocation model to determine the fair value of the underlying ordinary shares granted. Key assumptions, including
the risk-free interest rate, volatility, dividend yield rate and DLOM are required to be determined by the directors of
the Company with best estimates.
At grant dates
Risk-free interest rate (%) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182.28
V olatility (%) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111860
Dividend yield (%) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180
DLOM (%) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111824
2022 Share Option Plan
Pursuant to the 2022 Share Incentive Plan, 11,027,549 share options were granted in January 2022 to eligible
participants at the subscription price of USD0.15 per share (“ 2022 Share Option Plan ”). The shares of the options
granted during the Relevant Periods are vesting in the parts of 33%, 33% and 34% on the first, second and third
anniversaries of the vesting commencement date. The Group does not have a past practice of cash settlement for these
share options. The Group accounts for the share option plan as an equity-settled plan.
The fair value of the share options at grant date was RMB47,479,000.
During the year ended 31 December 2023, 2024 and 31 August 2025, share-based payment compensation
expenses of RMB15,492,000, RMB5,748,000 and RMB4,113,000 were charged to profit or loss under the 2022 Share
Option Plan.
The following share options were outstanding under the 2022 Employee Incentive Plan during the Relevant
Periods.
Weighted average
exercise price
Number of share
options
USD per share
As at 1 January 2023 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.15 11,027,549
Granted during the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118––
As at 31 December 2023 and 1 January 2024 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.15 11,027,549
Granted during the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118––
Conversion to 2024 Share Option Plan (Note) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(0.15) (11,027,549)
As at December 2024 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118––
Note: The Company granted 11,027,549 share options of the Company to participants of 2022 Share Option
Plan as mentioned in the paragraph and were conversed to 2024 Share Option Plan as mentioned in the
2024 Share Incentive Plan below.
The fair value of share-based payment compensations granted under the 2022 Share Option Plan during the
Relevant Periods was estimated as at the date of grant using a binomial model, taking into account the terms and
conditions upon which the options were granted. The following table lists the inputs to the model used:
At grant dates
Dividend yield (%) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180
Expected volatility (%) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111859.26
Risk-free interest rate (%) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182.78
Expected life of options (year) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11187.96 – 10.96
APPENDIX I ACCOUNTANTS’ REPORT
– I-53 –


--- page 611 ---
2024 Share Incentive Plan
Pursuant to the written resolutions of the shareholders of the Company passed in August 2024, the board of
directors of the Group passed a resolution to modify the share incentive plan by converting the platform of share
award from Hangzhou Hanx to Hanx HK one of the employee shareholding platforms of the Group (the “2024 Share
Incentive Plan”). Under the 2024 Share Incentive Plan, the eligible participants of the 2022 Share Incentive Plan and
the number of underlying shares of the Group awarded remain unchanged.
2024 RSU Plan
Pursuant to the 2024 Share Incentive Plan, the same eligible participants of the 2022 Share Incentive Plan were
granted with the same number of RSUs and vesting period of the 2022 RSU Plan, representing 2,250,000 shares
(“2024 RSU Plan”). Except that the 2024 RSU Plan requires that RSUs be unlocked only after the successful IPO,
there are no other modifications to the restrictions related to the RSUs.
No incremental fair value is expected to be recognised for the modification because the modification as
assessed by the management of the Company will not cause the increase in the total fair value of the share-based
payments as measured at the date of modification.
2024 Share Option Plan
Pursuant to the 2024 Share Incentive Plan, the same eligible participants of the 2022 Share Incentive Plan were
granted with the same number of share options and vesting period of the 2022 Share Option Plan, representing
11,027,549 shares and newly granted a total of 327,942 share options to a senior executive in August 2024, which
were granted in Hanx HK, and a total of 304,507 share options to certain employees of the Group, which were granted
in Wuhan Hansitai Management Consulting Partnership (Limited Partnership) (“Wuhan Hansitai”), an employee
incentive platform established in the PRC (“2024 Share Option Plan”).
The following share options were outstanding under the 2024 Share Option Plan (Hanx HK platform) during
the Relevant Periods.
Weighted average
exercise price
Number of
share options
USD per share
As at 1 January 2024 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118––
Conversion from 2022 Share Option Plan (Note) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.15 11,027,549
Granted during the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181.37 327,942
As at 31 December 2024 and 1 January 2025 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.19 11,355,491
Granted during the period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118––
As at 31 August 2025 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.19 11,355,491
Note: The Company also granted 11,027,549 share options of the Company to participants of 2022 Share
Option Plan as mentioned in the paragraph headed “2022 Share Option Plan” in this note.
The exercise prices and exercise periods of the share options outstanding as at the end of each of the Relevant
Periods are as follows:
As at 31 December 2023, 2024 and 31 August 2025
Number of options Date of grant Exercise price Exercise period
USD per share
327,942 22 August 2024 1.37 22 August 2024 to 22
August 2032
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 612 ---
The Group applied the binomial model to determine the fair value of the share options issued at the date of
issuance. Key assumptions are set out below:
At grant dates
Dividend yield (%) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180%
Expected volatility (%) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111868.94%-69.93%
Risk-free interest rate (%) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181.88%-2.09%
Expected life of options (year) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188
The fair value of the share options at grant date during the years ended 31 December 2024 was
RMB20,457,022. The shares of the options granted during the Relevant Periods are vesting in the parts of 33%, 33%
and 34% on the first, second and third anniversaries of the vesting commencement date. The share-based payments
expenses relating to share options recognised in profit or loss was RMB8,526,000 and RMB6,130,000 during the
years ended 31 December 2024 and eight months ended 31 August 2025.
The following share options were outstanding under the 2024 Share Incentive Plan (Wuhan Hansitai platform)
during the Relevant Periods.
Weighted average
exercise price
Number of share
options
USD per share
As at 1 January 2024 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118––
Granted during the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181.28 304,507
As at 31 December 2024 and 1 January 2025 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181.28 304,507
Granted during the period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118––
As at 31 August 2025 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181.28 304,507
The exercise prices and exercise periods of the share options outstanding as at the end of each of the Relevant
Periods are as follows:
As at 31 December 2024 and 31 August 2025
Number of options Date of grant Exercise price Exercise period
USD per share
304,507 22 August 2024 1.28 22 August 2024 to 22
August 2032
The Group applied the binomial model to determine the fair value of the share options issued at the date of
issuance. Key assumptions are set out below:
At grant date
2024/8/22
Dividend yield (%) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180%
Expected volatility (%) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111868.94%–69.93%
Risk-free interest rate (%) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181.88%–2.10%
Expected life of options (year) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188
The fair value of the share options at grant date during the years ended 31 December 2024 was
RMB19,372,735.
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 613 ---
Each grant of share awards need to meet service requirements from the date of grant to the later of three years
since the grant date (the “Service Period”). The shares of the options granted during the Relevant Periods are vesting
in the parts of 25%, 25%, 25% and 25% on the grant date, first, second and third anniversaries of the vesting
commencement date. The share-based payments expenses relating to share options recognised in profit or loss were
RMB8,074,000 and RMB5,805,000 during the years ended 31 December 2024 and eight months ended 31 August
2025.
28. INTEREST-BEARING BANK BORROWINGS
As at 31 December 2023 As at 31 December 2024 As at 31 August 2025
Effective
interest
rate (%) Maturity RMB’000
Effective
interest
rate (%) Maturity RMB’000
Effective
interest
rate (%) Maturity RMB’000
Current
Secured bank loans /H1118– – – – – – 3 2026 10,000
Unsecured bank
loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–– – –– –
2.8-
3.1
2025-
2026 40,000
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 50,000
As at 31 December As at 31 August
2023 2024 2025
RMB’000 RMB’000 RMB’000
Analysed into:
Bank loans repayable:
Within one year or on demand /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 50,000
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 50,000
(a) Certain of the Group’s bank loans were secured by Wuhan Optics V alley Technology Financing
Guarantee Co., Ltd.
29. NOTES TO THE CONSOLIDATED STATEMENT OF CASH FLOWS
Major non-cash transactions
During the years ended 31 December 2023, 2024 and 31 August 2025, the Group had non-cash additions to
right-of-use assets and lease liabilities of RMB15,714,000, nil and RMB458,000 respectively, in respect of lease
arrangements for offices.
During the year ended 31 December 2023, the Group had non-cash additions to paid-in capital, reserves and
other payables of RMB3,215,000, RMB219,119,000 and RMB33,174,000, respectively, and a non-cash reduction to
non-controlling interests of RMB255,508,000 in respect of the purchases the non-controlling shareholder’s equity
interests in Hangzhou Hanx by issuing shares of the Company as disclosed in note 25.
During the year ended 31 December 2023, the Group had a non-cash addition to paid-in capital and a non-cash
reduction to other payables of RMB1,930,000 in respect of the loan to the Company, which was converted to paid-in
capital as disclosed in note 25.
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 614 ---
(a) Changes in liabilities arising from financing activities
Redemption liabilities Lease liabilities
RMB’000 RMB’000
At 1 January 2023 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11187,898 409
Accretion of interest recognized during the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,211 69
Additional redemption liabilities on Series B shares classified
as financing cash flows /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111891,379 –
New leases /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 15,714
Payments classified as financing cash flows /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (1,161)
At 31 December 2023 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118101,488 15,031
Redemption liabilities Lease liabilities
RMB’000 RMB’000
At 1 January 2024 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118101,488 15,031
Accretion of interest recognised during the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188,771 608
Increase in deferred listing expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118––
Additional redemption liabilities on Series B+ shares
classified as financing cash flows /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111821,305 –
New leases /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118––
Payments classified as financing cash flows /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (3,808)
Payments classified as operating cash flows /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118––
At 31 December 2024 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118131,564 11,831
Redemption
Liabilities Lease liabilities
Interest-bearing
bank borrowings
RMB’000 RMB’000 RMB’000
At 1 January 2025 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118131,564 11,831 –
Accretion of interest recognised during the
period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,917 339 276
New interest-bearing bank loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 50,000
New leases /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 458 –
Payments classified as financing cash flows /H1118/H1118/H1118/H1118– (1,962) (276)
At 31 August 2025 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118138,481 10,666 50,000
(b) Total cash outflow for leases
The total cash outflow for leases included in the statement of cash flows is as follows:
As at 31 December As at 31 August
2023 2024 2025
RMB’000 RMB’000 RMB’000
Within operating activities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118789 233 58
Within financing activities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,161 3,808 1,962
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,950 4,041 2,020
APPENDIX I ACCOUNTANTS’ REPORT
– I-57 –


--- page 615 ---
(c) Commitments
The Group had the following capital commitments as at 31 December 2023, 2024 and 31 August 2025:
As at 31 December As at 31 August
2023 2024 2025
RMB’000 RMB’000 RMB’000
Leasehold improvements /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,959 463 464
Software /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189 5––
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,054 463 464
30. RELATED PARTY TRANSACTIONS
(a) Name and relationship
The directors of the Group are of the opinion that the following companies are related parties that had
transactions or balances with the Group during the Relevant Periods:
Name of related parties Relationship with the Group
Waterstone Pharmaceuticals (Wuhan) Co., Ltd. /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Entity significantly influenced by a director
Waterstone Pharmaceuticals (Hubei) Co., Ltd. /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Entity significantly influenced by a director
Jiangsu Jinsrui Fuming Biotechnology Co., Ltd /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Entity significantly influenced by a director
Stonycreek Pharmatch Co., Ltd /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Entity significantly influenced by a director
(b) Transactions with related parties
The Group had the following transactions with related parties during the Relevant Periods:
The Group
Y ear ended 31 December Eight months ended 31 August
2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Purchase of services:
Waterstone Pharmaceuticals (Wuhan)
Co., Ltd. /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 8 8––
Waterstone Pharmaceuticals (Hubei)
Co., Ltd. /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118952 548 194 99
Jiangsu Jinsrui Fuming
Biotechnology Co., Ltd /H1118/H1118/H1118/H1118/H1118/H1118/H1118– 3,012 3,012 2,786
Stonycreek Pharmatch Co., Ltd /H1118/H1118/H1118/H11187 9 2–––
1,744 3,648 3,206 2,885
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 616 ---
(c) Balances with related parties
As at 31 December As at 31 August
2023 2024 2025
RMB’000 RMB’000 RMB’000
Prepayments, other receivables and other assets
(trade):
Waterstone Pharmaceuticals (Hubei) Co., Ltd. /H1118/H1118/H1118–7 3 –
Jiangsu Jinsrui Fuming Biotechnology Co., Ltd /H1118 – 6,422 3,635
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 6,495 3,635
Trade payables (trade):
Waterstone Pharmaceuticals (Wuhan) Co., Ltd. /H1118/H1118 47 47 –
Waterstone Pharmaceuticals (Hubei) Co., Ltd. /H1118/H1118/H111852 52 27
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111899 99 27
(d) Compensation of key management personnel of the Group:
Y ear ended 31 December Eight months ended 31 August
2023 2024 2024 2025
RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Salaries, allowances and benefits
in kind /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,670 5,251 3,385 7,058
Performance related bonuses /H1118/H1118/H1118/H1118/H1118141 6,449 2,962 1,830
Social welfare and other benefits /H1118/H1118/H1118– 169 109 113
Share-based payments /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111882 21,102 14,274 25,155
1,893 32,971 20,730 34,156
31. 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:
(a) Financial assets
As at 31 December As at 31 August
2023 2024 2025
RMB’000 RMB’000 RMB’000
Financial assets at fair value through profit
or loss:
V ariable consideration arising from disposal of
an associate /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118249,264 246,443 222,206
Structured deposits and wealth management
products /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111835,470 – 10,731
Financial assets at amortised cost:
Financial assets included in prepayments, other
receivables and other assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111876,737 40,446 17,982
Long-term time deposits at banks /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111820,016 – –
Pledged deposits /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185 0 0––
Cash and cash equivalents /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118162,000 161,214 150,000
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118543,987 448,103 400,919
APPENDIX I ACCOUNTANTS’ REPORT
– I-59 –


--- page 617 ---
(b) Financial liabilities
As at 31 December As at 31 August
2023 2024 2025
RMB’000 RMB’000 RMB’000
Financial liabilities at amortised cost:
Trade payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111812,936 12,293 16,225
Financial liabilities included in other payables
and accruals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111833,108 35,631 4,229
Redemption liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118101,488 131,564 138,481
Lease liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111815,031 11,831 10,666
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118162,563 191,319 169,601
32. FAIR V ALUE AND FAIR V ALUE HIERARCHY OF FINANCIAL INSTRUMENTS
The carrying amounts and fair values of the Group’s financial instruments, other than those with carrying
amounts that reasonably approximate to fair values, are as follows:
As at 31 December As at 31 December As at 31 August
2023 2024 2025
Carrying
amount Fair value
Carrying
amount Fair value
Carrying
amount Fair value
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Financial assets
V ariable consideration arising
from disposal of an
associate /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118249,264 249,264 246,443 246,443 222,206 222,206
Structured deposits and wealth
management products /H1118/H1118/H1118/H111835,470 35,470 – – 10,731 10,731
284,734 284,734 246,443 246,443 232,937 232,937
Management has assessed that the fair values of cash and cash equivalents, the current portion of pledged
deposits, trade payables, financial assets included in prepayments, other receivables and other assets, financial
liabilities included in other payables and accruals approximate to their carrying amounts largely due to the short term
maturities of these instruments.
The Group’s finance department headed by the financial controller 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 fair values of the financial assets and liabilities are included at the amount at which the instrument could
be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale. The following
methods and assumptions were used to estimate the fair values:
The Group invests in structured deposits, which represent financial products issued by the bank. The Group
has estimated the fair value of these structured deposits by using a discounted cash flow valuation model based on
the market interest rates of instruments with similar terms and risks. Further details are set out in note 19 to the
Historical Financial Information.
APPENDIX I ACCOUNTANTS’ REPORT
– I-60 –


--- page 618 ---
Below is a summary of the valuation technique to the valuation of financial instruments as at the year ended
31 December 2023, 2024 and the eight months ended 31 August 2025:
Valuation technique
Significant
unobservable inputs Rate
Sensitivity of
fair value to
the input
V ariable consideration arising
from disposal of an
associate /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Discounted cash
flow method
Discount rate
Risk-free
interest rate
14.87%-15.29% Note (a)
Note:
(a) 1% increase/decrease in discount rate, with all other variables held constant, would decrease/increase the fair
value of variable consideration arising from disposal of an associate by RMB14,951,000/RMB16,307,000,
RMB16,446,100/RMB17,937,700 and RMB11,452,000/RMB12,366,000 as at 2023, 2024 and 31 August
2025.
Fair value hierarchy
The following tables illustrate the fair value measurement hierarchy of the Group’s financial instruments:
Assets measured at fair value:
Fair value measurement using
Quoted prices in
active markets
(Level 1)
Significant
observable inputs
(Level 2)
Significant
unobservable
inputs
(Level 3) Total
RMB’000 RMB’000 RMB’000 RMB’000
As at 31 December 2023
V ariable consideration arising from
disposal of an associate /H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 249,264 249,264
Structured deposits and wealth
management products /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 35,470 – 35,470
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 35,470 249,264 284,734
As at 31 December 2024
V ariable consideration arising from
disposal of an associate /H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 246,443 246,443
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 246,443 246,443
As at 31 August 2025
V ariable consideration arising from
disposal of an associate /H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 222,206 222,206
Structured deposits and wealth
management products /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 10,731 – 10,731
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 10,731 222,206 232,937
The Group did not have any financial liabilities measured at fair value as at the end of each of the Relevant
Periods.
During the Relevant Periods, there were no transfers of fair value measurements between Level 1 and Level
2 and no transfers into or out of Level 3 for both financial assets and financial liabilities.
APPENDIX I ACCOUNTANTS’ REPORT
– I-61 –


--- page 619 ---
33. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
The Group’s principal financial instruments comprise cash and cash equivalents, pledged deposits, financial
assets at FVTPL, prepayments, other receivables and other assets, other payables and accruals, trade payables, lease
liabilities. The main purpose of these financial instruments is to support the Group’s operations. The Group has
various other financial assets and liabilities such as trade payables which arise directly from its operations.
The main risks arising from the Group’s financial instruments are credit risk and liquidity risk. The board of
directors reviews and agrees policies for managing each of these risks and they are summarized below:
(a) Credit risk
The Group trades only with recognised and creditworthy third parties. In addition, receivable balances are
monitored on an ongoing basis and the Group’s exposure to bad debts is not significant.
Maximum exposure and year-end staging as at 31 December 2023, 2024 and 31 August 2025.
The table below shows 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 at the end of each of the Relevant Periods. The amounts presented are gross
carrying amounts for financial assets.
As at 31 December 2023
12-month ECLs Lifetime ECLs
Stage 1 Stage 2 Stage 3
Simplified
approach Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Financial assets included in
prepayments, other receivables
and other assets
– Normal* /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111876,737 – – – 76,737
Pledged deposits
– Not yet past due /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185 0 0––– 5 0 0
Cash and cash equivalents
– Not yet past due /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118162,000 – – – 162,000
Long-term time deposits at banks
– Not yet past due /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111820,016 – – – 20,016
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118259,253 – – – 259,253
As at 31 December 2024
12-month ECLs Lifetime ECLs
Stage 1 Stage 2 Stage 3
Simplified
approach Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Financial assets included in
prepayments, other receivables
and other assets
– Normal* /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111840,446 – – – 40,446
Cash and cash equivalents
– Not yet past due /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118161,214 – – – 161,214
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118201,660 – – – 201,660
APPENDIX I ACCOUNTANTS’ REPORT
– I-62 –


--- page 620 ---
As at 31 August 2025
12-month ECLs Lifetime ECLs
Stage 1 Stage 2 Stage 3
Simplified
approach Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Financial assets included
in prepayments, other
receivables and other
assets
– Normal* /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111817,98 2––– 17,982
Cash and cash equivalents
– Not yet past due /H1118/H1118/H1118/H1118150,00 0––– 150,000
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118167,98 2––– 167,982
* The credit quality of the financial assets included in prepayments, other receivables and other assets is
considered to be “normal” when they are not past due and there is no information indicating that the
financial assets had a significant increase in credit risk since initial recognition. Otherwise, the credit
quality of the financial assets is considered to be “doubtful”.
(b) Liquidity risk
In the management of liquidity risk, the Group monitors and maintains a level of cash and bank balances
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 contractual undiscounted payments, is as follows:
As at 31 December 2023
On demand Within 1 year 1 to 3 years Over 3 years Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Financial liabilities included in
other payables and accruals /H1118 1,864 31,244 – – 33,108
Trade payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 12,936 – – 12,936
Redemption liabilities /H1118/H1118/H1118/H1118/H1118/H1118– – – 149,119 149,119
Lease liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 3,348 13,938 – 17,286
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,864 47,528 13,938 149,119 212,449
As at 31 December 2024
On demand Within 1 year 1 to 3 years Over 3 years Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Financial liabilities included in
other payables and accruals /H1118 4,387 31,244 – – 35,631
Trade payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 12,293 – – 12,293
Redemption liabilities /H1118/H1118/H1118/H1118/H1118/H1118– 142,089 – – 142,089
Lease liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 3,635 9,693 – 13,328
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,387 189,261 9,693 – 203,341
APPENDIX I ACCOUNTANTS’ REPORT
– I-63 –


--- page 621 ---
As at 31 August 2025
On demand Within 1 year 1 to 3 years Over 3 years Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Financial liabilities included in
other payables and accruals /H1118 4,229 – – – 4,229
Trade payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 16,225 – – 16,225
Redemption liabilities /H1118/H1118/H1118/H1118/H1118/H1118– 138,481 – – 138,481
Lease liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 3,887 7,414 1,000 12,301
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,229 158,593 7,414 1,000 171,236
(c) 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 owners’ value.
The Group manages its capital structure and makes adjustments to it in light of changes in economic
conditions. To maintain or adjust the capital structure, the Group may adjust the dividend payment to owners, return
capital to owners 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.
34. PARTLY-OWNED SUBSIDIARIES WITH MATERIAL NON-CONTROLLING INTERESTS
Details of the Group’s subsidiaries that have material non-controlling interests are set out below.
As at 31 December As at 31 August
2023 2024 2025
Percentage of equity interest held by
non-controlling interests:
Wuhan Hanzhong Biotechnology Co., Ltd. /H1118/H1118/H1118/H1118/H111815% 15% 15%
As at 31 December As at 31 August
2023 2024 2025
RMB’000 RMB’000 RMB’000
Loss for the year allocated to non-controlling
interests:
Wuhan Hanzhong Biotechnology Co., Ltd. /H1118/H1118/H1118/H1118/H11188,310 3,251 3,067
Accumulated balances of non-controlling
interests at the reporting date:
Wuhan Hanzhong Biotechnology Co., Ltd. /H1118/H1118/H1118/H1118/H111863,518 60,267 57,200
APPENDIX I ACCOUNTANTS’ REPORT
– I-64 –


--- page 622 ---
The following tables illustrate the summarised financial information of the above subsidiaries. The amounts
disclosed are before any inter-company eliminations.
As at 31 December As at 31 August
2023 2024 2025
RMB’000 RMB’000 RMB’000
Total expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111834,533 30,831 24,651
Loss for the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111855,401 21,675 20,444
Total comprehensive loss for the year/period /H1118/H1118/H111855,401 21,675 20,444
Current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118512,374 448,956 418,775
Non-current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111854,031 53,500 53,531
Current liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111852,633 21,914 24,621
Non-current liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111890,320 78,765 66,351
Net cash flows from/(used in) operating
activities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111829,394 (62,076) (17,725)
Net cash flows from investing activities /H1118/H1118/H1118/H1118/H1118/H111876,964 26,921 10,779
Net increase/(decrease) in cash and cash
equivalents /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118106,358 (35,155) (6,946)
Cash and cash equivalents at beginning of
year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111824,304 130,662 95,507
Cash and cash equivalents at end of year/period /H1118 130,662 95,507 88,561
35. EVENTS AFTER THE RELEV ANT PERIODS
There were no material subsequent events after the end of the Relevant Periods that require additional
disclosure or adjustments.
36. 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 31 August 2025.
APPENDIX I ACCOUNTANTS’ REPORT
– I-65 –


--- page 623 ---
The following information sets out in this appendix does not form part of the Accountants’
Report from Ernst & Young, Certified Public Accountants, Hong Kong, the Reporting
Accountants, as set out in Appendix I to this prospectus, and is included herein for illustrative
purpose only. The unaudited pro forma financial information should be read in conjunction
with “Financial Information” 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 adjusted consolidated net tangible assets has been
prepared in accordance with Rule 4.29 of the Hong Kong 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 for
illustration purposes only, and is set out here to illustrate the effect of the Global Offering on
our consolidated net tangible assets as at 31 August 2025 as if it had taken place on 31 August
2025.
The unaudited pro forma adjusted consolidated net tangible assets attributable to the
owners of the Company has been prepared for illustrative purposes only and because of its
hypothetical nature, it may not give a true picture of the financial position of the Group had
the Global Offering been completed as at 31 August 2025 or any future dates. It is prepared
based on our consolidated net tangible assets as at 31 August 2025 as set out in the
Accountants’ Report as set out in Appendix I to this prospectus and adjusted as described
below.
Consolidated net
tangible assets of
the Group
attributable to
owners of the
Company as at
31 August 2025
Estimated net
proceeds from the
Global Offering
Estimated impact
to the
consolidated net
tangible assets
upon conversion
of Preferred
Shares
Unaudited pro
forma adjusted
consolidated net
tangible assets
attributable to
owners of the
Company as at
31 August 2025
Unaudited pro forma
adjusted consolidated net
tangible assets attributable
to owners of the
Company per Share as at
31 August 2025
RMB’000 RMB’000 RMB’000 RMB’000 RMB HK$
(Note 1) (Note 2) (Note 3) (Note 4) (Note 5)
Based on an Offer
Price of HK$28.00
per Offer Share /H1118/H111897,221 432,463 138,481 668,165 4.91 5.40
Based on an Offer
Price of HK$32.00
per Offer Share /H1118/H111897,221 497,088 138,481 732,790 5.38 5.92
APPENDIX II UNAUDITED PRO FORMA FINANCIAL INFORMATION
– II-1 –


--- page 624 ---
Notes:
1. The consolidated net tangible assets of the Group attributable to owners of the Company as at 31 August 2025
was equal to the consolidated net assets attributable to owners of the parent as at 31 August 2025 of RMB97.8
million after deducting intangible assets of attributable to the owners of the Company as at 31 August 2025
of RMB0.6 million, as shown in the Accountants’ Report in Appendix I to this prospectus.
2. The estimated net proceeds from the Global Offering are based on the Offer Price at the indicative Price of
HK$28 and HK$32 per Share, after deduction of the underwriting fees and other related expenses payable by
the Group (excluding the listing expenses that have been charged to profit or loss during the Track Record
Period) and do not take into account of any Shares which may be issued upon the exercise of the
Over-Allotment Option and/or under the Pre-IPO Share Plan. The estimated net proceeds from the Global
Offering are converted from Hong Kong dollars into Renminbi at an exchange rate of HK$1.0 to RMB0.90919.
No representation is made that the Hong Kong dollar amounts have been, could have been or may be converted
to Renminbi, or vice versa, at that rate or any other rates or at all.
3. The Preferred Shares would have converted into ordinary shares upon completion of Global Offering. The
conversion of Preferred Shares would have reclassified such preferred shares amounting to RMB138.5 million
from liabilities to equity and accordingly increased the unaudited pro forma adjusted consolidated net tangible
assets of the Group as at 31 August 2025 by RMB138.5 million.
4. The unaudited pro forma adjusted consolidated net tangible assets attributable to owners of the Company and
the amount per share are arrived at after adjustments referred to in the preceding paragraphs (note 2 and note
3 above) and on the basis that 136,218,830 shares were in issue assuming that the automatic conversion of
Preferred Shares into ordinary shares the Capitalisation Issue and Global Offering had been completed on
31 August 2025.
5. For the purpose of this unaudited pro forma statement of adjusted net tangible assets, the balances stated in
RMB are converted into HK$ at the rate of HK$1.00 to RMB0.90919.
6. 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 31 August 2025.
APPENDIX II UNAUDITED PRO FORMA FINANCIAL INFORMATION
– II-2 –


--- page 625 ---
B. INDEPENDENT REPORTING ACCOUNTANTS’ ASSURANCE REPORT ON THE
COMPILATION OF PRO FORMA FINANCIAL INFORMATION
To the Directors of Hanx Biopharmaceuticals (Wuhan) Co., Ltd.
We have completed our assurance engagement to report on the compilation of pro forma
financial information of Hanx Biopharmaceuticals (Wuhan) Co., Ltd. (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 31 August 2025, and related
notes as set out on pages II-1 to II-2 of the prospectus dated 15 December 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 II to the Prospectus.
The Pro Forma Financial Information has been compiled by the Directors to illustrate the
impact of the (1) the Global Offering and (2) conversion of Preferred Shares into ordinary
shares on the Group’s financial position as at 31 August 2025 as if the transaction had taken
place at 31 August 2025. 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 31 August 2025, on which an accountants’ report has been published.
Directors’ responsibilities 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.
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 or 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.
APPENDIX II UNAUDITED PRO FORMA FINANCIAL INFORMATION
– II-3 –


--- page 626 ---
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.
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.
APPENDIX II UNAUDITED PRO FORMA FINANCIAL INFORMATION
– II-4 –


--- page 627 ---
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.
Y ours faithfully,
Ernst & Y oung
Certified Public Accountants
Hong Kong
15 December 2025
APPENDIX II UNAUDITED PRO FORMA FINANCIAL INFORMATION
– II-5 –


--- page 628 ---
TAXATION OF SECURITY HOLDERS
The taxation of income and capital gains of holders of H Shares is subject to the laws and
practices of the PRC and of jurisdictions in which holders of H Shares are residents or
otherwise subject to tax. The following summary of certain relevant taxation provisions is
based on current effective laws and practices, and no predictions are made about changes or
adjustments to relevant laws or policies, and no legal or tax comments or suggestions are made
accordingly. The discussion has no intention to deal with all possible tax consequences
resulting from the investment in H Shares, nor does it take into account the specific
circumstances of any particular investor, some of which may be subject to special regulations.
Accordingly, investors should consult your own tax advisor regarding the tax consequences of
an investment in H Shares. The discussion is based upon laws and relevant interpretations in
effect as of the date of this document, which is fully subject to change or adjustment and may
have retrospective effect.
No issues on the PRC taxation other than dividend tax, income tax, stamp duty and estate
duty are referred in the discussion below. Prospective investors are urged to consult their
financial advisors regarding the PRC, Hong Kong and other tax consequences of owning and
disposing of H Shares.
Dividend Tax
Individual Investors
Pursuant to the Individual Income Tax Law of the PRC (੻೼
) (the “IIT Law”), which was latest amended on August 31, 2018 and the Implementation
Provisions of the Individual Income Tax Law of the PRC (ྼ
ૢԷ), which was latest amended on December 18, 2018, dividends distributed by PRC
enterprises are subject to a PRC withholding tax levied at a flat rate of 20%. For a foreign
individual who is not a resident of the PRC, the receipt of dividends from an enterprise in the
PRC is normally subject to a withholding tax of 20% unless specifically exempted by the tax
authority of the State Council or reduced by relevant tax treaty.
Pursuant to the Notice of State Administration of Taxation (the “SA T”) on Issues
Concerning the Administration of Individual Income Tax Collection after the Annulment of the
Document Guo Shui Fa [1993] No. 045 (਷೼೯[1993]045ܝ
) issued by the SA T on June 28, 2011, domestic non-
foreign-invested enterprises issuing shares in Hong Kong may, when distributing dividends,
withhold individual income tax at the rate of 10%. For the individual holders of H Shares
receiving dividends who are citizens of countries that have entered into a tax treaty with the
PRC with tax rates lower than 10%, the non-foreign-invested enterprise whose shares are listed
in Hong Kong may apply on behalf of such holders for enjoying the lower preferential tax
treatments, and, upon approval by the tax authorities, the amount which is over withheld will
be refunded. For the individual holders of H shares receiving dividends who are citizens of
countries that have entered into a tax treaty with the PRC with tax rates higher than 10% but
APPENDIX III TAXATION AND FOREIGN EXCHANGE
– III-1 –


--- page 629 ---
lower than 20%, the non-foreign-invested enterprise is required to withhold the tax at the
agreed rate under the treaties, and no application procedures will be necessary. For the
individual holders of H Shares receiving dividends who are citizens of countries without
taxation treaties with the PRC or otherwise, the non-foreign-invested enterprise is required to
withhold the tax at a rate of 20%.
Enterprise Investors
In accordance with the Enterprise Income Tax Law of the PRC ( ʕശɛ͏΍ձ਷Άุ
) (the “EIT Law”) effective as at December 29, 2018 and the Implementation
Provisions for the Enterprise Income Tax Law of the PRC (ྼ
ૢԷ) amended and came into effect on January 20, 2025, a non-resident enterprise is
generally subject to a 10% enterprise income tax on PRC-sourced income (including dividends
received from a PRC resident enterprise that issues shares in Hong Kong), if such non-resident
enterprise does not have an establishment or place in the PRC or has an establishment or place
in the PRC but the PRC-sourced income is not connected with such establishment or place in
the PRC. The withholding tax may be reduced pursuant to applicable treaties for the avoidance
of double taxation. Such income tax for non-resident enterprises is deducted at source, where
the payer of the income are required to withhold the income tax from the amount to be paid
to the non-resident enterprise when such payment is made or due.
The Circular on Issues Relating to the Withholding of Enterprise Income Tax by PRC
Resident Enterprises on Dividends Paid to Overseas Non-PRC Resident Enterprise
Shareholders of H Shares (Guo Shui Han [2008] No. 897) (͏ΆุΣྤ̮Hڢٰ
਷೼Ռ[2008]897 ໮) which was
issued by the SA T on November 6, 2008, further clarified that a PRC-resident enterprise must
withhold corporate income tax at a rate of 10% on dividends paid to non-PRC resident
enterprise shareholders of H Shares with respect to the dividends of 2008 and onwards. In
addition, the Response to Questions on Levying Enterprise Income Tax on Dividends Derived
by Non-resident Enterprise from Holding Stock such as B-shares (Guo Shui Han [2009] No.
394) (͏Άุ՟੻Bҭᔧ਷೼
Ռ[2009]394 ໮) which was issued by the SA T on July 24, 2009 and effective on the same date,
further provides that any PRC-resident enterprise that is listed on overseas stock exchanges
must withhold enterprise income tax at a rate of 10% on dividends of 2008 and onwards that
it distributes to non-resident enterprises. Such tax rates may be further modified pursuant to the
tax treaty or agreement that China has concluded with a relevant jurisdiction, where applicable.
Pursuant to the Arrangement between the Mainland and the Hong Kong Special
Administrative Region for the Avoidance of Double Taxation and the Prevention of Fiscal
Evasion with respect to Taxes on Income (ᅄ೼
τર) signed on August 21, 2006, the PRC Government may levy taxes on
the dividends paid by a PRC company to Hong Kong residents (including natural persons and
legal entities) in an amount not exceeding 10% of total dividends payable by the PRC company.
If a Hong Kong resident directly holds 25% or more of the equity interest in a PRC company,
then such tax shall not exceed 5% of the total dividends payable by the PRC company. Pursuant
APPENDIX III TAXATION AND FOREIGN EXCHANGE
– III-2 –


--- page 630 ---
to the Fifth Protocol to the Arrangement between the Mainland of China and Hong Kong
Special Administrative Region for the Avoidance of Double Taxation and the Prevention of
Fiscal Evasion with respect to Taxes on Income ( <੻ᒒеᕐ
τર>), which became effective on December 6, 2019,
the abovementioned provisions are not applicable to any arrangement which is primarily made
for the purpose of obtaining the above taxation benefits. The application of the dividend clause
of tax agreements is subject to the requirements of PRC tax law and regulation, such as the
Notice of the SA T on the Issues Concerning the Application of the Dividend Clauses of Tax
Agreements () (Guo Shui Han
[2009] No. 81).
Tax Treaties
Investors who are not PRC residents and reside in countries which have entered into
avoidance of double taxation treaties with the PRC are entitled to a reduction of the
withholding taxes imposed on the dividends received from PRC companies. The PRC has
entered into arrangements for the avoidance of double taxation with a number of countries and
regions including but not limited to Hong Kong, Macau, Australia, Canada, France, Germany,
Japan, Malaysia, the Netherlands, Singapore, the United Kingdom and the United States.
Non-PRC resident enterprises entitled to preferential tax rates in accordance with the relevant
income tax treaties or arrangements are required to apply to the PRC tax authorities for a
refund of the withholding tax in excess of the agreed tax rate, and the refund payment is subject
to approval by the PRC tax authorities.
Income tax
Individual Investors
According to the IIT Law and its implementation provisions, gains realised on the sale of
equity interests in PRC resident enterprises are subject to the income tax at a rate of 20%.
Pursuant to the Circular of the MOF and SA T on Declaring that Individual Income Tax
Continues to be Exempted over Income of Individuals from the Transfer of Shares (௅e
) (Cai Shui Zi [1998]
No. 61) issued by the MOF and SA T on March 30, 1998, from January 1, 1997, income of
individuals from transfer of the shares of listed enterprises continues to be exempted from
individual income tax. SA T has not expressly stated whether it will continue to exempt tax on
income of individuals from transfer of the shares of listed enterprises in the latest amended IIT
Law and its implementation provisions.
However, on December 31, 2009, the MOF, SA T and the CSRC jointly issued the Circular
on Relevant Issues Concerning the Collection of Individual Income Tax over the Income
Received by Individuals from Transfer of Listed Shares Subject to Sales Limitation (Cai Shui
[2009] No. 167) ()( ৌ
೼[2009]167 ໮), which provides that individuals’ income from transferring listed shares on
APPENDIX III TAXATION AND FOREIGN EXCHANGE
– III-3 –


--- page 631 ---
certain domestic exchanges shall continue to be exempted from individual income tax, except
for certain shares which are subject to sales limitations as defined in the Supplementary
Circular on Relevant Issues Concerning the Collection of Individual Income Tax over the
Income Received by Individuals from Transfer of Listed Shares Subject to Sales Limitation
(Cai Shui [2010] No. 70) (໾
)( ৌ೼[2010]70 ໮). As at the Latest Practicable Date, the aforesaid provision has not
expressly provided that individual income tax shall be collected from non-PRC resident
individuals on the transfer of shares of PRC resident enterprises listed on overseas stock
exchanges. To the knowledge of the Company, in practice, the PRC tax authorities have not
collected income tax from non-PRC resident individuals on gains from the transfer of shares
of PRC resident enterprises listed on overseas stock exchanges.
Enterprise Investors
In accordance with the EIT Law and its implementation provisions, a non-resident
enterprise is generally subject to a 10% enterprise income tax on PRC-sourced income,
including gains derived from the disposal of equity interests in a PRC resident enterprise, if it
does not have an establishment or place in the PRC or has an establishment or place in the PRC
but the PRC-sourced income is not connected with such establishment or place. Such income
tax for non-resident enterprises is deducted at source, where the payer of the income is required
to withhold the income tax from the amount to be paid to the non-resident enterprise when such
payment is made or due. Such tax may be reduced or exempted pursuant to relevant tax treaties
or agreements on avoidance of double taxation.
Stamp Duty
Pursuant to the Provisional Regulations of the PRC on Stamp Duty ( ʕശɛ͏΍ձ਷
೼ᅲБૢԷ) effective on October 1, 1998 and amended on January 8, 2011, the
Implementation Provisions of Provisional Regulations of the PRC on Stamp Duty ( ʕശɛ
) effective on October 1, 1988, and the Stamp Tax Law of
the PRC () issued on June 10, 2021 and effective on July 1,
2022, PRC stamp duty only applies to documents executed or received within the PRC, having
legally binding force in the PRC and protected under the PRC laws, thus the requirements of
the stamp duty imposed on the transfer of shares of PRC listed companies shall not apply to
the acquisition and disposal of H Shares by non-PRC investors outside of the PRC. Upon the
Stamp Tax Law of the PRC coming into effect on July 1, 2022, the Provisional Regulations of
the PRC on Stamp Duty shall be abolished simultaneously.
Estate Duty
As of the date of this document, no estate duty has been levied in the PRC under the PRC
laws.
APPENDIX III TAXATION AND FOREIGN EXCHANGE
– III-4 –


--- page 632 ---
FOREIGN EXCHANGE
The lawful currency of the PRC is Renminbi, which is currently subject to foreign
exchange control and cannot be freely converted into foreign currency. The State
Administration of Foreign Exchange (the “SAFE”), with the authorization of the People’s Bank
of China (the “PBOC”), is empowered with the functions of administering all matters relating
to foreign exchange, including the enforcement of foreign exchange control regulations.
Pursuant to the Administrative Regulations on Foreign Exchange of the People’s Republic
of China ( ʕശɛ͏΍ձ਷̮ි၍ଣૢԷ) which was implemented on August 5, 2008, all
international payments and transfers are classified into current account and capital account.
Current account is subject to the reasonable examination of the veracity of transaction
documents and the consistency between the transaction documents and the foreign exchange
receipts and payments by financial institutions engaging in settlement and sale of foreign
currencies, and supervision and inspection by the foreign exchange administrative authorities.
For capital account, overseas organizations and individuals making direct investments in China
shall, upon approval by the relevant competent authorities, process registration formalities with
the foreign exchange administrative authorities. Foreign exchange income received overseas
can be repatriated or deposited overseas, and foreign exchange and foreign exchange
settlement funds under the capital account are required to be used only for purposes as
approved by the competent authorities and foreign exchange administrative authorities. In the
event that a material misbalance occurs or may occur in international revenues and
expenditure, or the national economy encounters or may encounter a severe crisis, the State
may adopt necessary safeguard and control measures on international revenues and
expenditure.
The Regulations for the Administration of Settlement, Sale and Payment of Foreign
Exchange (), which was promulgated by the PBOC on June
20, 1996 and implemented on July 1, 1996, removes other restrictions on convertibility of
foreign exchange under current account, while imposing existing restrictions on foreign
exchange transactions under capital account. Consequently, Renminbi is generally freely
convertible for payments under current account, such as trade and service-related foreign
exchange transactions and dividend payments, but remains to be not freely convertible under
capital account, such as direct investment, loan or investment in securities outside of China
unless prior approval of the SAFE or its local counterparts is obtained.
According to the Announcement on Improving the Reform of the Renminbi Exchange
Rate Formation Mechanism (ʮѓ), which was
issued by the PBOC and implemented on July 21, 2005, the PRC has started to implement a
managed floating exchange rate system in which the exchange rate would be determined based
on market supply and demand and adjusted with reference to a basket of currencies since July
21, 2005. Therefore, the Renminbi exchange rate was no longer pegged to the U.S. dollar
solely. The PBOC would publish the closing price of the exchange rate of the Renminbi against
APPENDIX III TAXATION AND FOREIGN EXCHANGE
– III-5 –


--- page 633 ---
trading currencies such as the U.S. dollar in the interbank foreign exchange market after the
closing of the market on each working day, as the central parity of Renminbi against the
currency on the following working day.
According to the relevant laws and regulations in the PRC, PRC enterprises (including
foreign invested enterprises) which need foreign exchange for current account transactions
may, without the approval of the foreign exchange administrative authorities, effect payment
through foreign exchange accounts opened at the designated foreign exchange bank, on the
strength of valid transaction receipts and proof. Foreign invested enterprises which need
foreign exchange for the distribution of profits to their shareholders and PRC enterprises (such
as our Company) which, in accordance with regulations, are required to pay dividends to their
shareholders in foreign exchange may, on the strength of resolutions of the board of directors
or the shareholders’ meeting on the distribution of profits, effect payment from foreign
exchange accounts at the designated foreign exchange bank, or effect exchange and payment
at the designated foreign exchange bank.
According to the Decision of the State Council on Cancelling and Adjusting a Batch of
Items Subject to Administrative Examination and Approval and Other Items (՟
) which was promulgated by the State Council on
October 23, 2014, it decided to cancel the approval requirement of the SAFE and its branches
for the remittance and settlement of the proceeds raised from the overseas listing of the foreign
shares into Renminbi domestic accounts.
According to the Notice of the State Administration of Foreign Exchange on Issues
Concerning the Foreign Exchange Administration of Overseas Listing (׵
) issued by the SAFE and implemented on December 26,
2014, a domestic company shall, within 15 business days from the date of the end of its
overseas listing issuance, register the overseas listing with the local branch office of the SAFE
at the place of its establishment; the proceeds from an overseas listing of a domestic company
may be remitted to the domestic account or deposited in an overseas account, but the use of
the proceeds shall be consistent with the content set out in the document and other disclosure
documents.
According to the Circular of the SAFE on the Policies for Reforming and Standardizing
Management of Foreign Exchange Settlement under the Capital Account (̮ි၍ଣ҅ᗫ
) which was promulgated by the SAFE,
implemented on June 9, 2016 and was amended on December 4, 2023, foreign exchange
receipts under capital account (including the repatriation of the proceeds from overseas listing)
on which discretionary settlement have been clearly imposed under relevant policies, may be
settled with banks according to actual business needs of the domestic institutions. The tentative
percentage of foreign exchange settlement for foreign exchange receipts under capital account
of domestic institutions is 100%, subject to adjustment of the SAFE in due time in accordance
with international revenue and expenditure situations.
APPENDIX III TAXATION AND FOREIGN EXCHANGE
– III-6 –


--- page 634 ---
According to the Circular on Further Simplifying and Improving Policies for Foreign
Exchange Administration for Direct Investment (ટҳ༟̮ි၍ଣ
), which was issued by the SAFE on February 13, 2015, implemented on June 1,
2015 and partially lapsed on December 30, 2019, the confirmation of foreign exchange
registration under domestic direct investment and the confirmation of foreign exchange
registration under overseas direct investment shall be directly examined and handled by banks
and the foreign exchange authorities shall indirectly regulate the foreign exchange registration
of direct investment through banks.
On January 26, 2017, the Notice of the State Administration of Foreign Exchange on
Further Promoting the Reform of Foreign Exchange Administration and Improving the
Examination of Authenticity and Compliance (Hui Fa [2017] No. 3) (׵
) was promulgated by the SAFE and
implemented to further expand the scope of settlement for domestic foreign exchange loans,
allow settlement for domestic foreign exchange loans with export background under goods
trading, allow repatriation of funds under domestic guaranteed foreign loans for domestic
utilization, allow settlement for domestic foreign exchange accounts of foreign institutions
operating in the Free Trade Pilot Zones, and adopt the model of full-coverage Renminbi and
foreign currency overseas lending management, where a domestic institution engages in
overseas lending, the sum of its outstanding overseas lending in Renminbi and outstanding
overseas lending in foreign currencies shall not exceed 30% of its owner’s equity in the audited
financial statements of the preceding year.
On October 23, 2019, the SAFE issued the Notice on Further Facilitating Cross-Board
Trade and Investment (Hui Fa [2019] No. 28) (ஷ
), which canceled restrictions on domestic equity investments made with capital funds by
non-investing foreign-funded enterprises. In addition, restrictions on the use of funds for
foreign exchange settlement of domestic accounts for the realization of assets have been
removed and restrictions on the use and foreign exchange settlement of foreign investors’
security deposits have been relaxed. Eligible enterprises in the pilot area are also allowed to
use revenues under capital accounts, such as capital funds, foreign debts and overseas listing
revenues for domestic payments without providing materials to the bank in advance for
authenticity verification on an item by item basis, while the use of funds should be true, in
compliance with applicable rules and conforming to the current capital revenue management
regulations.
APPENDIX III TAXATION AND FOREIGN EXCHANGE
– III-7 –


--- page 635 ---
THE PRC LEGAL SYSTEM
The PRC legal system is based on Constitution of the People’s Republic of China ( ʕ
, the “ Constitution ”), which was adopted on September 20, 1954 and
subsequently amended on January 17, 1975, March 5, 1978, December 4, 1982, April 12, 1988,
March 29, 1993, March 15, 1999, March 14, 2004 and March 11, 2018. The PRC legal system
is made up of written laws, administrative regulations, local regulations, autonomous
regulations, separate regulations, rules and regulations of State Council departments, rules and
regulations of local governments, laws of special administrative regions and international
treaties of which the PRC government is a signatory and other regulatory document. Court
judgments do not constitute legally binding precedents, although they are used for the purposes
of judicial reference and guidance.
The National People’s Congress (the “ NPC”) and its Standing Committee are empowered
to exercise the legislative power of the State in accordance with the Constitution and the
Legislation Law of the People’s Republic of China (, the
“Legislation Law ”), which was adopted on March 15, 2000 and amended on March 15, 2015
and March 13, 2023. The NPC has the power to formulate and amend basic laws governing
state authorities, civil, criminal and other matters. The Standing Committee of the NPC
formulates and amends laws other than those required to be enacted by the NPC and to
supplement and amend parts of the laws enacted by the NPC during the adjournment of the
NPC, provided that such supplements and amendments are not in conflict with the basic
principles of such laws.
The State Council is the highest organ of state administration and has the power to
formulate administrative regulations based on the Constitution and laws.
The people’s congresses of the provinces, autonomous regions and municipalities and
their respective standing committees may formulate local regulations based on the specific
circumstances and actual needs of their respective administrative areas, provided that such
local regulations do not contravene any provision of the Constitution, laws or administrative
regulations. The people’s congresses of cities divided into districts and their respective
standing committees may formulate local regulations on aspects such as urban and rural
construction and management, environmental protection and historical cultural protection
based on the specific circumstances and actual needs of such cities, provided that such local
regulations do not contravene any provision of the Constitution, laws, administrative
regulations and local regulations of their respective provinces or autonomous regions. If the
law provides otherwise on the matters concerning formulation of local regulations by cities
divided into districts, those provisions shall prevail. Such local regulations will become
enforceable after being reported to and approved by the standing committees of the people’s
congresses of the relevant provinces or autonomous regions but such local regulations shall
conform with the Constitution, laws, administrative regulations, and the relevant local
regulations of the relevant provinces or autonomous regions. The standing committees of the
people’s congresses of the provinces or autonomous regions examine the legality of local
APPENDIX IV SUMMARY OF PRINCIPAL PRC LEGAL AND
REGULATORY PROVISIONS
–I V - 1–


--- page 636 ---
regulations submitted for approval, and such approval should be granted within four months if
they are not in conflict with the Constitution, laws, administrative regulations and local
regulations of such provinces or autonomous regions. Where, during the examination for
approval of local regulations of cities divided into districts by the standing committees of the
people’s congresses of the provinces or autonomous regions, conflicts are identified with the
rules and regulations of the people’s governments of the provinces or autonomous regions
concerned, a handling decision should be made by the standing committees of the people’s
congresses of provinces or autonomous regions to resolve the issue. People’s congresses of
national autonomous areas have the power to enact autonomous regulations and separate
regulations in light of the political, economic and cultural characteristics of the ethnic groups
in the areas concerned. The autonomous regulations and separate regulations of an autonomous
region shall come into force after being reported to and approved by the Standing Committee
of the NPC. The autonomous regulations and separate regulations of an autonomous prefecture
or an autonomous county shall come into force after being reported to and approved by the
standing committee of the people’s congress of the province, autonomous region, or
municipality directly under the Central Government.
The ministries and commissions of the State Council, the People’s Bank of China,
National Audit Office and the subordinate institutions with administrative functions directly
under the State Council may formulate departmental rules within the jurisdiction of their
respective departments based on the laws and administrative regulations, and the decisions and
orders of the State Council. The people’s governments of the provinces, autonomous regions,
municipalities and cities or autonomous prefectures divided into districts may formulate rules
and regulations based on the laws, administrative regulations and local regulations of such
provinces, autonomous regions and municipalities.
According to the Constitution and the Legislation Law, the power to interpret laws is
vested in the Standing Committee of the NPC. Pursuant to the Resolution of the Standing
Committee of the NPC Providing an Improved Interpretation of the Law (ɽ
Ӕᙄ) implemented on June 10, 1981, the Supreme
People’s Court has the power to give interpretation on issues related to the application of laws
and decrees in a court trial, and issues related to the application of laws and decrees in a
prosecution process of a procuratorate should be interpreted by the Supreme People’s
Procuratorate. If there is any disagreement in principle between Supreme People’s Court’s
interpretations & Supreme People’s Procuratorate’s interpretations, such issues shall be
reported to the Standing Committee of the NPC for interpretation or judgment. The other issues
related to laws and decrees other than the abovementioned should be interpreted by the State
Council and the competent authorities. The State Council and its ministries and commissions
are also vested with the power to give interpretations of the administrative regulations and
departmental rules which they have promulgated. At the regional level, the power to interpret
regional laws is vested in the regional legislative and administrative authorities which
promulgate such laws.
APPENDIX IV SUMMARY OF PRINCIPAL PRC LEGAL AND
REGULATORY PROVISIONS
–I V - 2–


--- page 637 ---
THE PRC JUDICIAL SYSTEM
Under the Constitution and the Law of Organization of the People’s Courts of the People’s
Republic of China (), which is adopted on September 21,
1954 and subsequently amended on July 5, 1979, September 2, 1983, December 2, 1986,
October 31, 2006 and October 26, 2018, the PRC judicial system is made up of the Supreme
People’s Court, the local people’s courts and other special people’s courts.
The local people’s courts are comprised of the primary people’s courts, the intermediate
people’s courts and the higher people’s courts. The primary people’s courts may set up civil,
criminal, and economic divisions, and certain people’s tribunals based on the facts of the
region, population and cases. The intermediate people’s courts have divisions similar to those
of the primary people’s courts and may set up other special divisions if needed. These two
levels of people’s courts are subject to supervision by people’s courts at higher levels. The
Supreme People’s Court is the highest judicial authority in the PRC. It supervises the
administration of justice by the people’s courts at all levels and special people’s courts. The
Supreme People’s Procuratorate is authorized to supervise the judgment and ruling of the
people’s courts at all levels which have been legally effective, and the people’s procuratorate
at a higher level is authorized to supervise the judgment and ruling of a people’s court at lower
levels which have been legally effective.
Under the Civil Procedure Law of the People’s Republic of China ( ʕശɛ͏΍ձ਷͏
), which is adopted on April 9, 1991 and subsequently amended on October 28,
2007, August 31, 2012, June 27, 2017, and September 1, 2023, which became effective from
January 1, 2024 a people’s court takes the rule of the second instance as the final rule. A party
may appeal against the judgment or ruling of the first instance of a local people’s court. The
people’s procuratorate may present a protest to the people’s court at the next higher level in
accordance with the procedures stipulated by the laws. In the absence of any appeal by the
parties and any protest by the people’s procuratorate within the stipulated period, the
judgments or rulings of the people’s court are final. Judgments or rulings of the second instance
of the intermediate people’s courts, the higher people’s courts and the Supreme People’s Court,
and judgments or rulings of the first instance of the Supreme People’s Court are final.
However, if the Supreme People’s Court finds some definite errors in a legally effective
judgment, ruling or conciliation statement of the people’s court at any level, or if the people’s
court at a higher level finds such errors in a legally effective judgment, ruling or conciliation
statement of the people’s court at a lower level, it has the authority to review the case itself or
to direct the lower-level people’s court to conduct a retrial. If the chief judge of all levels of
people’s courts finds some definite errors in a legally effective judgment, ruling or conciliation
statement, and considers a retrial is preferred, such case shall be submitted to the judicial
committee of the people’s court at the same level for discussion and decision.
The Civil Procedure Law of the People’s Republic of China prescribes the conditions for
instituting a civil action, the jurisdiction of the people’s courts, the procedures for conducting
a civil action, and the procedures for enforcement of a civil judgment or ruling. All parties to
APPENDIX IV SUMMARY OF PRINCIPAL PRC LEGAL AND
REGULATORY PROVISIONS
–I V - 3–


--- page 638 ---
a civil action conducted within the PRC must abide by the PRC Civil Procedure Law.
Generally, a civil case is initially heard by the court located in the defendant’s place of
domicile. The court of jurisdiction in respect of a civil action may also be chosen by explicit
agreement among the parties to a contract, provided that the people’s court having jurisdiction
should be located at places substantially connected with the disputes, such as the plaintiff’s or
the defendant’s place of domicile, the place where the contract is executed or signed or the
place where the object of the action is located, provided that the provisions regarding the level
of jurisdiction and exclusive jurisdiction shall not be violated.
A foreign individual, a person without nationality, a foreign enterprise or a foreign
organization is given the same litigation rights and obligations as a citizen, a legal person or
other organizations of the PRC when initiating actions or defending against litigations at a PRC
court. Should a foreign court limit the litigation rights of PRC citizens or enterprises, the PRC
court may apply the same limitations to the citizens and enterprises of such foreign country.
A foreign individual, a person without nationality, a foreign enterprise or a foreign organization
must engage a PRC lawyer in case he or it needs to engage a lawyer for the purpose of initiating
actions or defending against litigations at a PRC court. All parties to a civil action shall
perform the legally effective judgments and rulings. If any party to a civil action refuses to
abide by a judgment or ruling made by a people’s court or an award made by an arbitration
tribunal in the PRC, the other party may apply to the people’s court for the enforcement of the
same within two years subject to application for postponed enforcement or revocation. If a
party fails to satisfy within the stipulated period a judgment which the court has granted an
enforcement approval, the court may, upon the application of the other party, mandatorily
enforce the judgment on the party.
Where a party applies for enforcement of a judgment or ruling made by a people’s court,
and the opposite party or his property is not within the territory of the PRC, the applicant may
directly apply to a foreign court with jurisdiction for recognition and enforcement of the
judgment or ruling. A foreign judgment or ruling may also be recognized and enforced by the
people’s court in accordance with the PRC enforcement procedures if the PRC has entered into,
or acceded to, international treaties with the relevant foreign country, which provided for such
recognition and enforcement, or if the judgment or ruling satisfies the court’s examination
according to the principle of reciprocity, unless the people’s court considers that the
recognition or enforcement of such judgment or ruling would violate the basic legal principles
of the PRC, its sovereignty or national security, or against the social and public interests.
THE PRC SECURITIES LA WS AND REGULATIONS
The PRC has promulgated a number of regulations that relate to the issue and trading of
shares and disclosure of information. In October 1992, the State Council established the
Securities Committee and the CSRC. The Securities Committee is responsible for coordinating
the drafting of securities regulations, formulating securities-related policies, planning the
development of securities markets, directing, coordinating and supervising all securities related
institutions in the PRC and administering the CSRC. The CSRC is the regulatory arm of the
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Securities Committee and is responsible for the drafting of regulatory provisions of securities
markets, supervising securities companies, regulating public offering of securities by PRC
companies in the PRC or overseas, regulating the trading of securities, compiling
securities-related statistics and undertaking relevant research and analysis. In April 1998, the
State Council consolidated the two departments and reformed the CSRC.
The Interim Provisional Regulations on the Administration of Share Issuance and Trading
(၍ଣᅲБૢԷ) stipulates the public offerings of equity securities, trading
in equity securities, the acquisition of listed companies, deposit, clearing and transfer of listed
equity securities, the disclosure of information with respect to a listed company, investigation
penalties and dispute settlement.
On December 25, 1995, the State Council promulgated the Regulations of the State
Council Concerning Domestic Listed Foreign Shares of Joint Stock Limited Companies
(). These regulations principally govern
the issue, subscription, trading and declaration of dividends and other distributions of domestic
listed foreign shares and disclosure of information of joint stock limited companies having
domestic listed foreign shares.
The Securities Law of the People’s Republic of China (, the
“PRC Securities Law ”) took effect on July 1, 1999 and was revised as of August 28, 2004,
October 27, 2005, June 29, 2013, August 31, 2014 and December 28, 2019, respectively. The
PRC Securities Law, which was revised on December 28, 2019 and came into effect on March
1, 2020, is divided into 14 chapters and 226 articles, regulating, among other things, the issue
and trading of securities, the listing of securities, and takeovers of listed companies.
Article 224 of the PRC Securities Law provides that domestic enterprises which, directly
or indirectly, issue securities or list and trade their securities outside the PRC shall comply with
the relevant regulations of the State Council. Currently, the issue and trading of foreign issued
securities (including shares) are principally governed by the regulations and rules promulgated
by the State Council and the CSRC.
ARBITRATION AND ENFORCEMENT OF ARBITRAL A W ARD
The Arbitration Law of the People’s Republic of China () (the
“PRC Arbitration Law ”) was enacted by the Standing Committee of the NPC on August 31,
1994, which became effective on September 1, 1995 and was amended on August 27, 2009 and
September 1, 2017, respectively. It is applicable to, among other matters, economic disputes
involving foreign parties where all parties have entered into a written agreement to resolve
disputes by arbitration before an arbitration committee constituted in accordance with the PRC
Arbitration Law. The PRC Arbitration Law provides that an arbitration committee may, before
the promulgation of arbitration regulations by the PRC Arbitration Association, formulate
interim arbitration rules in accordance with the PRC Arbitration Law and the PRC Civil
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Procedure Law. Where the parties have agreed to settle disputes by means of arbitration, a
people’s court will refuse to handle a legal proceeding initiated by one of the parties at such
people’s court, unless the arbitration agreement is invalid.
Under the PRC Arbitration Law and PRC Civil Procedure Law, an arbitral award shall be
final and binding on the parties involved in the arbitration. If any party fails to comply with
the arbitral award, the other party to the award may apply to a people’s court for its
enforcement. The people’s court can issue a ruling prohibiting the enforcement of an arbitral
award made by an arbitration commission after verification by collegial bench formed by the
people’s court if there is any procedural irregularity (including but not limited to irregularity
in the composition of the arbitration tribunal or arbitration proceedings, the jurisdiction of the
arbitration commission, or the making of an award on matters beyond the scope of the
arbitration agreement).
Any party seeking to enforce an award of a foreign affairs arbitral body of the PRC
against a party who or whose property is not located within the PRC shall apply to a foreign
court with jurisdiction over the case for recognition and enforcement of the award. Likewise,
an arbitral award made by a foreign arbitral body may be recognized and enforced by a PRC
court in accordance with the principle of reciprocity or any international treaties concluded or
acceded to by the PRC.
The PRC acceded to the Convention on the Recognition and Enforcement of Foreign
Arbitral Awards (, the “ New Y ork Convention ”) adopted on
June 10, 1958 pursuant to a resolution passed by the Standing Committee of the NPC on
December 2, 1986. The New Y ork Convention provides that all arbitral awards made in a state
which is a party to the New Y ork Convention shall be recognized and enforced by other parties
thereto subject to their rights to refuse enforcement under certain circumstances, including
where the enforcement of the arbitral award is against the public policy of that state. At the
time of the PRC’s accession to the Convention, the Standing Committee of the NPC declared
that (i) the PRC will only apply the Convention to the recognition and enforcement of arbitral
awards made in the territories of other parties based on the principle of reciprocity; and (ii) the
New Y ork Convention will only be applied to disputes deemed under PRC laws to be arising
from contractual or non-contractual mercantile legal relations.
An arrangement was reached between Hong Kong and the Supreme People’s Court for the
mutual enforcement of arbitral awards. On June 18, 1999, the Supreme People’s Court adopted
the Arrangements of the Supreme People’s Court on the Mutual Enforcement of Arbitral
Awards between the Mainland and the Hong Kong Special Administrative Region ( ௰৷ɛ
τર), which became effective on
February 1, 2000 and was amended by the Supplemental Arrangement of the Supreme People’s
Court for the Mutual Enforcement of Arbitral Awards between the Mainland and the Hong
Kong Special Administrative Region (2021) (ʝ
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໾̂τર(2021) ). In accordance with this arrangement, awards made by
PRC arbitral authorities under the Arbitration Law can be enforced in Hong Kong, and Hong
Kong arbitration awards are also enforceable in the PRC.
JUDICIAL JUDGMENT AND ITS ENFORCEMENT
According to the Arrangement on Mutual Recognition and Enforcement of Judgments in
Civil and Commercial Matters by the Courts of the Mainland China and of the Hong Kong
Special Administrative Region Pursuant to Agreed Jurisdiction by Parties Concerned ( ௰৷
΁кӔ
τર) (the “ Arrangement ”) promulgated by the Supreme People’s Court on July 3, 2008
and implemented on August 1, 2008, in the case of final judgment, defined with payment
amount and enforcement power, made between the court of Mainland China and the court of
the Hong Kong Special Administrative Region in a civil and commercial case with written
jurisdiction agreement, any party concerned may apply to the People’s Court of China or the
court of the Hong Kong Special Administrative Region for recognition and enforcement based
on this arrangement. “Written jurisdiction agreement” refers to a written agreement defining
the exclusive jurisdiction of either the People’s Court of China or the court of the Hong Kong
Special Administrative Region in order to resolve any dispute with particular legal relation
occurred or likely to occur by the party concerned. Therefore, the party concerned may apply
to the People’s Court of China or the court of the Hong Kong Special Administrative Region
to recognize and enforce the final judgment made in China or Hong Kong that meets certain
conditions of the aforementioned regulations. On January 18, 2019, a further arrangement was
reached between Hong Kong Special Administrative Region and the Supreme People’s Court,
Arrangements for Reciprocal Recognition and Enforcement of Judgments in Civil and
Commercial Cases between Courts of the Mainland and Hong Kong Special Administrative
Region (τ
ર)) (the “ New Arrangement ”), which became effective and replace the Arrangement on
January 29, 2024, privileged that “Written Agreement on Jurisdiction” reached under the
Arrangement before January 29, 2024 will still apply. This New Arrangement further stipulates
the scope and content of judgments applicable to the reciprocal recognition and enforcement
and corresponding procedures and methods for applying, the circumstances concerning review,
non-recognition and enforcement upon the jurisdiction of the court of first instance and the
means of remedy. Non-monetary judgments and judgments on some intellectual property cases
are included in the reciprocal recognition and enforcement of judgments in accordance with
this New Arrangement.
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THE COMPANY LA W, THE OVERSEAS LISTING TRIAL MEASURES AND THE
GUIDELINES
The Company Law of the People’s Republic of China () (the
“Company Law ”) was adopted by the 5th meeting of the SCNPC on December 29, 1993 and
came into effect on July 1, 1994. It was amended on December 25, 1999, August 28, 2004,
October 27, 2005, December 28, 2013, October 26, 2018, and December 29, 2023, which will
become effective from July 1, 2024, respectively. The latest revised Company Law was
implemented on July 1, 2024.
The Trial Administrative Measures of Overseas Securities Offering and Listing by
Domestic Companies () (the “ Overseas
Listing Trial Measures ”) which were promulgated by the CSRC on February 17, 2023 and
came into effect on March 31, 2023, and were applicable to the overseas offering and listing
of PRC domestic companies’ securities.
The Guidelines for Articles of Association of Listed Companies (ˏ)
the “ Guidelines ”) which were issued by the CSRC on December 16, 1997, latest revised on
December 15, 2023 and came into effect on the same date, providing the guidelines for the
Articles of Association. As such, the contents provided in the Guidelines are set out in the
Articles of Association of the Company, the summary of which is set out in the section entitled
“Appendix V — Summary of the Articles of Association” in this prospectus.
Set out below is a summary of the major provisions of the Company Law, the Overseas
Listing Trial Measures and the Guidelines applicable to the Company.
General
A joint stock limited company refers to an enterprise legal person incorporated in China
under the Company Law with independent legal person properties and entitlements to such
legal person properties and with its registered capital divided into shares of equal par value.
The liability of the company for its own debts is limited to all the properties it owns and the
liability of its shareholders for the company is limited to the extent of the shares they subscribe
for.
Incorporation
A joint stock limited company may be incorporated by promotion or public subscription.
A joint stock limited company may be incorporated by a minimum of one but not more than
200 promoters, and at least half of the promoters must have residence within the PRC. The
promoters must convene an inaugural meeting within 30 days after the full payment of the
shares to be issued at the time of the establishment of the company, and must give notice to
all subscribers or make an announcement of the date of the inaugural meeting 15 days before
the meeting. The inaugural meeting may be convened only with the presence of subscribers
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holding a majority of the voting rights. At the inaugural meeting, matters including the
adoption of articles of association and the election of members of the board of directors and
members of the supervisory committee of the company will be dealt with. All resolutions of the
meeting require the approval of subscribers with more than half of the voting rights present at
the meeting.
Within 30 days after the conclusion of the inaugural meeting, the board of directors must
authorize a representative to apply to the registration authority for registration of the
establishment of the joint stock limited company. A company is formally established, and has
the status of a legal person, after the business license has been issued by the relevant
registration authority.
If a promoter does not contribute in accordance with the shares subscribed for by it or if
the actual value of the non-monetary property contributed as capital is significantly less than
the shares subscribed for, the other promoters shall be jointly and severally liable with it to the
extent of the shortfall in the capital contribution.
Share Capital
The promoters of a company can make capital contributions in cash or in non-monetary
assets which can be valued in currency and transferable according to law, such as physical
items, intellectual property rights, land use rights, equity interests, creditor’s rights and so on,
except for properties that are prohibited from being used as capital contributions under the
provisions of laws and administrative regulations. If capital contribution is made other than in
cash, valuation and verification of the property contributed must be carried out and converted
into shares. The shares issued by a company shall be registered shares.
The Overseas Listing Trial Measures provides that domestic enterprises that are listed
overseas may raise funds and distribute dividends in foreign currencies or Renminbi.
Under the Overseas Listing Trial Measures, for a domestic company directly offering and
listing overseas, shareholders of its domestic unlisted shares applying to convert such shares
into shares listed and traded on an overseas trading venue shall conform to relevant regulations
promulgated by the CSRC, and authorise the domestic company to file with the CSRC on their
behalf. The domestic unlisted shares mentioned in the preceding paragraph refer to the shares
that have been issued by domestic enterprises but have not been listed or listed for trading on
domestic exchanges. Domestic unlisted shares shall be centrally registered and deposited with
domestic securities registration and settlement institutions. The registration and settlement
arrangements of overseas listed shares shall be subject to the provisions of overseas listing
places.
The share offering price may be equal to or greater than nominal value, but shall not be
less than nominal value.
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The transfer of shares by shareholders should be conducted via the legally established
stock exchange or in accordance with other methods as stipulated by the State Council.
Transfer of shares by a shareholder must be made by means of an endorsement or by other
means stipulated by laws or administrative regulations.
Shares issued by a company prior to the public offering of its shares shall not be
transferred within one year from the date of listing of the shares of the company on a stock
exchange. Directors, supervisors and senior management of a company shall declare to the
company their holdings of the company’s shares and the status of changes therein, and shall not
transfer over 25% of the shares held by each of them in the company each year during the term
of office determined at the time of assumption of office or transfer any share of the company
held by each of them within one year after the listing date.
Transfers of shares may not be entered in the register of shareholders within 20 days
before the date of a shareholders’ meeting or within five days before the record date set for the
purpose of distribution of dividends.
Allotment and Issue of Shares
All issue of shares of a joint stock limited company shall be based on the principles of
equality and fairness. The same class of shares must carry equal rights. Shares issued at the same
time and within the same class must be issued on the same conditions and at the same price. It
may issue shares at par value or at a premium, but it may not issue shares below the par value.
Domestic enterprises issued and listed overseas shall file with the CSRC in accordance
with Overseas Listing Trial Measures, submit filing reports, legal opinions and other relevant
materials, and truthfully, accurately and completely explain shareholder information and other
information. Where a domestic enterprise directly issues and is listed overseas, the issuer shall
file with the CSRC. If a domestic enterprise is indirectly listed overseas, the issuer shall
designate a major domestic operating entity as the domestic responsible person and file with
the CSRC.
Increase in Share Capital
According to the Company Law, when the joint stock limited company issues new shares,
resolutions shall be passed by a shareholders’ meeting, approving the class and number of the
new shares, the issue price of the new shares, the commencement and end of the new share
issuance and the class and amount of new shares to be issued to existing shareholders. In the
case of the issue of shares without par value, more than half of the proceeds of issue of the new
shares is to be included in the registered capital.
When a company offers shares to the public, it shall be registered by the securities
regulatory authority under the State Council and announce a document. When the shares issued
by the company are fully paid up, a public announcement shall be made accordingly.
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Reduction of Share Capital
A company may reduce its registered capital in accordance with the following procedures
prescribed by the Company Law: (i) the company shall prepare a balance sheet and a property
list; (ii) the reduction of registered capital shall be approved by a shareholders’ meeting; (iii)
the company shall inform its creditors of the reduction in capital within 10 days and publish
an announcement of the reduction in the newspaper or the National Enterprise Credit
Information Publicity System within 30 days from the date of the resolution on the reduction;
and (iv) creditors may within 30 days after receiving the notice, or within 45 days of the public
announcement if no notice has been received, require the company to pay its debts or provide
guarantees covering the debts.
Repurchase of Shares
According to the Company Law, a joint stock limited company may not purchase its
shares other than for one of the following purposes: (i) to reduce its registered capital; (ii) to
merge with another company that holds its shares; (iii) to grant its shares for carrying out an
employee stock ownership plan or equity incentive plan; (iv) to purchase its shares from
shareholders who request and are against the resolution regarding the merger or division with
other companies at a shareholders’ meeting; (v) use of shares for conversion of convertible
corporate bonds issued by the company; and (vi) the share buyback is necessary for a listed
company to maintain its company value and protect its shareholders’ equity.
The purchase of shares on the grounds set out in (i) and (ii) above shall require approval
by way of a resolution passed by the shareholders’ meeting. For a company’s share buyback
under any of the circumstances stipulated in (iii), (v) or (vi) above, a resolution of the
company’s board of directors shall be made by a two-third majority of directors attending the
meeting according to the provisions of the company’s articles of association or as authorized
by the shareholders’ meeting.
Following the purchase of shares in accordance with (i), such shares shall be cancelled
within 10 days from the date of purchase. The shares shall be assigned or deregistered within
six months if the share buyback is made under the circumstances stipulated in either (ii) or (iv).
The shares held in total by a company after a share buyback under any of the circumstances
stipulated in (iii), (v) or (vi) shall not exceed 10% of the company’s total outstanding shares,
and shall be assigned or deregistered within three years.
Listed companies making a share buyback shall perform their obligation of information
disclosure according to the provisions of the Securities Law. If a listed company purchases its
shares under any of the circumstances stipulated in (iii), (v) or (vi) hereof, centralised trading
shall be adopted publicly.
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Transfer of Shares
Shares held by shareholders may be transferred in accordance with the relevant laws and
regulations. Pursuant to the Company Law, transfer of shares by shareholders shall be carried
out at a legally established securities exchange or in other ways stipulated by the State Council.
No modifications of registration in the share register caused by transfer of registered shares
shall be carried out within 20 days prior to the convening of shareholder’s meeting or five days
prior to the base date for determination of dividend distributions. However, where there are
separate provisions by law on alternation of the shareholder register of listed companies, those
provisions shall prevail.
Shareholders
Under the Company Law and the Guidelines, the rights of holders of ordinary shares of
a joint stock limited company include the right:
(1) to receive dividends and profit distributions in any other form in proportion to their
shareholdings;
(2) to lawfully require, convene, preside over or attend shareholders’ meetings either in
person or by proxy and exercise the corresponding voting right;
(3) to supervise, present suggestions on or make inquiries about the operations of the
Company;
(4) to transfer, gift or pledge their shares in accordance with the laws, administrative
regulations and the articles of association;
(5) to inspect the company’s articles of association, shareholder register, counterfoil of
company debentures, minutes of shareholders’ meetings, resolutions of the board of
directors, resolutions of the Supervisory Committee and financial and accounting
reports of the company;
(6) in the event of the termination or liquidation of the company, to participate in the
distribution of the remaining property of the company in proportion to the shares
held by them;
(7) to require the company to buy their shares in the event of their objection to
resolutions of the shareholders’ meeting concerning merger or division of the
company; and
(8) any other shareholders’ rights provided for in laws, administrative regulations, other
regulatory documents and the articles of association.
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The obligations of a shareholder include the obligation to abide by the Company’s articles
of association, to pay the subscription moneys in respect of the shares subscribed for and in
accordance with the form of making capital contributions, to be liable for the company’s debts
and liabilities to the extent of the amount of his or her subscribed shares and any other
shareholders’ obligation specified in the company’s articles of association.
Shareholders’ Meetings
The shareholders’ meeting is the organ of authority of the company, which exercises its
powers in accordance with the Company Law. The shareholders’ meeting may exercise its
powers:
(1) to elect and remove the directors and supervisors and to decide on the matters
relating to the remuneration of directors and supervisors;
(2) to review and approve the reports of the board of directors;
(3) to review and approve the reports of the Supervisory Committee;
(4) to review and approve the company’s profit distribution proposals and loss recovery
proposals;
(5) to decide on any increase or reduction of the company’s registered capital;
(6) to decide on the issue of corporate bonds;
(7) to decide on merger, division, dissolution and liquidation of the company or change
of its corporate form;
(8) to amend the articles of association; and
(9) to exercise any other authority stipulated in the articles of association.
A shareholders’ meeting is required to be held once every year. An extraordinary
shareholders’ meeting is required to be held within two months of the occurrence of any of the
following:
(1) the number of directors is less than the number stipulated by the Company Law or
less than two-thirds of the number specified in the articles of association;
(2) the outstanding losses of the company amounted to one-third of the company’s total
share capital;
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(3) shareholders individually or in aggregate holding 10% or more of the company’s
shares request the convening of an extraordinary shareholders’ meeting;
(4) the board deems necessary;
(5) the Supervisory Committee proposes to hold; or
(6) any other circumstances as provided for in the articles of association.
Under the Company Law, shareholders’ meetings shall be convened by the board of
directors and presided over by the chairman of the board of directors. In the event that the
chairman is incapable of performing or does not perform his duties, the meeting shall be
presided over by the vice chairman. In the event that the vice chairman is incapable of
performing or not performing his duties, a director nominated by more than half of directors
shall preside over the meeting.
Where the board of directors is incapable of performing or not performing its duties of
convening the shareholders’ meeting, the supervisory committee shall convene and preside
over such meeting in a timely manner. In case the supervisory committee fails to convene and
preside over such meeting, shareholders alone or in aggregate holding more than 10% of the
company’s shares for 90 days consecutively may unilaterally convene and preside over such
meeting.
Under the Company Law, notice of shareholders’ meeting shall state the time and venue
of and matters to be considered at the meeting and shall be given to all shareholders 20 days
before the meeting. Notice of extraordinary shareholders’ meetings shall be given to all
shareholders 15 days prior to the meeting. Under the Guidance for Articles of Association, after
the notice of the shareholders’ meetings is issued, the shareholders’ meetings shall not be
postponed or cancelled without justifiable reasons, and the proposals listed in the notice of
shareholders’ meetings shall not be cancelled. In the event of postponement or cancellation, the
convener shall make an announcement and explain the reasons at least two working days before
the original meeting date.
There is no specific provision in the Company Law regarding the number of shareholders
constituting a quorum in a shareholders’ meeting. Pursuant to the Guidance for Articles of
Association, the board of directors and the Secretary of the board of directors will cooperate
with the shareholders’ meetings convened by the supervisory committee or shareholders. The
board of directors will provide the register of shareholders on the date of equity registration.
Moreover, when a shareholders’ meetings is held, all directors, supervisors and the secretary
of the board of directors of the company shall attend the meeting, and managers and other
senior management personnel shall attend the meeting as nonvoting delegates.
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Pursuant to the Company Law, shareholders who individually or jointly hold more than
1% of the company’s shares may put forward interim proposals and submit them to the
convener in writing 10 days before the shareholders’ meetings. The convener shall issue a
supplementary notice of the shareholders’ meetings within two days after receiving the
proposal and announce the contents of the interim proposal.
Under the Company Law, shareholders present at shareholders’ meeting have one vote for
each share they hold, except the shareholders of classified shares, save that shares held by the
company are not entitled to any voting rights.
Pursuant to the provisions of the articles of association or a resolution of the
shareholders’ meeting, the accumulative voting system may be adopted for the election of
directors and supervisors at the shareholders’ meeting. Under the accumulative voting system,
each share shall be entitled to vote equivalent to the number of directors or supervisors to be
elected at the shareholders’ meeting and shareholders may consolidate their voting rights when
casting a vote.
Pursuant to the Company Law and the Guidance for Articles of Association, resolutions
of the shareholders’ meeting shall be adopted by more than half of the voting rights held by
the shareholders present at the meeting. However, resolutions of the shareholders’ meeting
regarding the following matters shall be adopted by more than two-thirds of the voting rights
held by the shareholders present at the meeting: (i) amendments to the articles of association;
(ii) the increase or decrease of registered capital; (iii) equity incentive plan; (iv) the company
purchases or sells major assets within one year or any guaranty provided to others by the
company within one year exceeds 30% of the company’s total audited assets in the latest
period; (v) the merger, division, dissolution, liquidation or change in the form of the company;
and (vi) other matters stipulated by laws, administrative regulations or the Articles of
Association, as well as other matters considered by the shareholders’ meeting, by way of an
ordinary resolution, to be of a nature which may have a material impact on the company and
should be adopted by a special resolution.
Under the Company Law, meeting minutes shall be prepared in respect of decisions on
matters discussed at the shareholders’ meeting. The chairman of the meeting and directors
attending the meeting shall sign to endorse such minutes. The minutes shall be kept together
with the shareholders’ attendance register and the proxy forms.
Board of Directors
Under the Company Law, a joint stock limited company is required to establish a board
of directors. A joint stock limited company that is of small size or has a small number of
shareholders may not have a board of directors and may have one director who exercises the
powers and functions of the board of directors as provided for in the Company Law. Members
of the board of directors may include representatives of the employees of the company, who
shall be democratically elected by the company’s staff at the staff representative assembly,
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general staff meeting or otherwise. The term of a director shall be stipulated in the articles of
association, but no term of office shall last for more than three years. Directors may serve
consecutive terms if re-elected. A director shall continue to perform his duties in accordance
with the laws, administrative regulations and articles of association until a duly re-elected
director takes office, if re-election is not conducted in a timely manner upon the expiry of his
term of office, or if the resignation of directors results in the number of directors being less
than the quorum.
Under the Company Law, the board of directors may exercise its powers:
(1) to convene shareholders’ meetings and report on its work to the shareholders’
meetings;
(2) to implement resolutions of the shareholders’ meeting;
(3) to decide on the company’s operational plans and investment proposals;
(4) to formulate the company’s profit distribution proposals and loss recovery
proposals;
(5) to formulate proposals for the increase or reduction of the company’s registered
capital and the issue of corporate bonds;
(6) to formulate proposals for the merger, division or dissolution of the company or
change of corporate form;
(7) to decide on the setup of the company’s internal management organs;
(8) to appoint or dismiss the company’s manager and decide on his/her remuneration
and, based on the manager’s recommendation, to appoint or dismiss any deputy
general manager and financial officer of the company and to decide on their
remunerations;
(9) to formulate the company’s basic management system; and
(10) to exercise any other authority stipulated in the articles of association.
Board Meetings
Under the Company Law, meetings of the board of directors of a joint stock limited
company shall be convened at least twice a year. Notice of meeting shall be given to all
directors and supervisors 10 days before the meeting. Interim board meetings may be proposed
to be convened by shareholders representing more than 10% of voting rights, more than
one-third of the directors or the supervisory committee. The chairman shall convene and
APPENDIX IV SUMMARY OF PRINCIPAL PRC LEGAL AND
REGULATORY PROVISIONS
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--- page 651 ---
preside over such meeting within 10 days after receiving such proposal. Meetings of the board
of directors shall be held only if half or more of the directors are present. Resolutions of the
board of directors shall be passed by more than half of all directors. Each director shall have
one vote for resolutions to be approved by the board of directors. Directors shall attend board
meetings in person. If a director is unable to attend a board meeting, he may appoint another
director by a written power of attorney specifying the scope of the authorisation to attend the
meeting on his behalf.
If a resolution of the board of directors violates the laws, administrative regulations or the
articles of association, and as a result of which the company sustains serious losses, the
directors participating in the resolution are liable to compensate the company. However, if it
can be proved that a director expressly objected to the resolution when the resolution was voted
on, and that such objection was recorded in the minutes of the meeting, such director may be
exempted from that liability.
Chairman of the Board
Under the Company Law, the board of directors shall appoint a chairman and may appoint
a vice chairman. The chairman and the vice chairman are elected with approval of more than
half of all the directors. The chairman shall convene and preside over board meetings and
examine the implementation of board resolutions. The vice chairman shall assist the work of
the chairman. In the event that the chairman is incapable of performing or not performing his
duties, the duties shall be performed by the vice chairman. In the event that the vice chairman
is incapable of performing or not performing his duties, a director nominated by more than half
of the directors shall perform his duties.
Qualification of Directors
The Company Law provides that the following persons may not serve as a director:
(1) a person who is unable or has limited ability to undertake any civil liabilities;
(2) a person who has been convicted of an offence of corruption, bribery, embezzlement
or misappropriation of property, or the destruction of socialist market economy
order; or who has been deprived of his political rights due to his crimes, in each case
where less than five years have elapsed since the date of completion of the sentence.
If he/she has been pronounced on a suspended sentence, the period of two years has
not elapsed since the expiration of the suspension of sentence;
(3) a person who has been a former director, factory manager or manager of a company
or an enterprise that has entered into insolvent liquidation and who was personally
liable for the insolvency of such company or enterprise, where less than three years
have elapsed since the date of the completion of the bankruptcy and liquidation of
the company or enterprise;
APPENDIX IV SUMMARY OF PRINCIPAL PRC LEGAL AND
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--- page 652 ---
(4) a person who has been a legal representative of a company or an enterprise that has
had its business license revoked due to violations of the law and has been ordered
to close down by law and the person was personally responsible, where less than
three years have elapsed since the date of revocation of business license and the
order for closure; or
(5) a person who is listed as a dishonest person subject to enforcement by the people’s
court due to his/her failure to pay off a relatively large amount of due debts.
Other circumstances under which a person is disqualified from acting as a director are set
out in the Guidance for Articles of Association.
Supervisory Committee
Under the Company Law, a joint stock limited company may, in accordance with the
provisions of its articles of association, establish an audit committee under the board of
directors comprising directors to exercise the powers and functions of the Supervisory
Committee, in place of a Supervisory Committee or supervisors. Otherwise, a joint stock
limited company shall have a supervisory committee composed of not less than three members.
The supervisory committee is made up of representatives of the shareholders and an
appropriate proportion of representatives of the employees of the company. The actual
proportion shall be stipulated in the articles of association, provided that the proportion of
representatives of the employees shall not be less than one third of the supervisors.
Representatives of the employees of the company in the supervisory committee shall be
democratically elected by the employees at the employees’ representative assembly,
employees’ general meeting or otherwise. The directors and senior management may not act
concurrently as supervisors.
The supervisory committee shall appoint a chairman and may appoint a vice chairman.
The chairman and the vice chairman of the supervisory committee are elected with approval of
more than half of all the supervisors. The chairman of the supervisory committee shall convene
and preside over the meetings of the supervisory committee. In the event that the chairman of
the supervisory committee is incapable of performing or not performing his duties, the vice
chairman of the supervisory committee shall convene and preside over the meetings of the
supervisory committee. In the event that the vice chairman of the supervisory committee is
incapable of performing or not performing his duties, a supervisor nominated by more than half
of the supervisors shall convene and preside over the meetings of the supervisory committee.
Each term of office of a supervisor is three years and he or she may serve consecutive
terms if re-elected. A supervisor shall continue to perform his duties in accordance with the
laws, administrative regulations and articles of association until a duly re-elected supervisor
takes office, if re-election is not conducted in a timely manner upon the expiry of his term of
office, or if the resignation of supervisors results in the number of supervisors being less than
the quorum.
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--- page 653 ---
The supervisory committee of a company shall hold at least one meeting every six
months. According to the Company Law, a resolution of the supervisory committee shall be
passed by more than half of all the supervisors.
The supervisory committee exercises the following powers:
(1) to review the company’s financial position;
(2) to supervise the directors and senior management in their performance of their
duties and to propose the removal of directors and senior management who have
violated laws, regulations, the articles of association or the resolutions of
shareholders’ meeting;
(3) when the acts of directors and senior management are harmful to the company’s
interests, to require correction of those acts;
(4) to propose the convening of extraordinary shareholders’ meetings and to convene
and preside over shareholders’ meetings when the board of directors fails to perform
the duty of convening and presiding over shareholders’ meeting under this law;
(5) to initiate proposals for resolutions to shareholders’ meeting;
(6) to initiate proceedings against directors and senior management;
(7) other powers specified in the articles of association; and
(8) supervisors may attend board meetings and make enquiries or proposals in respect
of board resolutions. The supervisory committee may initiate investigations into any
irregularities identified in the operation of the company and, where necessary, may
engage an accounting firm to assist their work at the company’s expense.
Manager and Senior Management
Under the Company Law, a company shall have a manager who shall be appointed or
removed by the board of directors. The manager shall exercise his/her powers in accordance
with provisions of the articles of association or as authorised by the board of directors. The
manager attends board meetings. According to the Company Law, senior management shall
mean the manager, deputy manager(s), person-in-charge of finance, board secretary (in case of
a listed company) of a company and other personnel as stipulated in the articles of association.
APPENDIX IV SUMMARY OF PRINCIPAL PRC LEGAL AND
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--- page 654 ---
Duties of Directors, Supervisors and Senior Management
Directors, supervisors and senior management of the company are required under the
Company Law to comply with the relevant laws, regulations and the articles of association.
Directors, supervisors and senior management have fiduciary and diligent duties to the
company and should take measures to avoid any conflict between their own interests and the
interests of the company and not make use of their powers to obtain improper benefits.
Directors, supervisors and senior management have a duty of diligence to the company and
should exercise reasonable care in performing their duties in the best interests of the company,
as would normally be expected of a manager.
Directors, supervisors and senior management are prohibited from:
(1) misappropriating company property or funds;
(2) depositing the company’s capital into accounts under his/her own name or the name
of other individuals;
(3) giving bribes or accepting any other illegal proceeds by taking advantage of his/her
power;
(4) taking commissions from the transactions between the company and any other
person into his/her own pocket;
(5) unauthorized divulgence of confidential business information of the company; or
(6) other acts in violation of their fiduciary duty to the company.
Income generated by directors or senior management in violation of aforementioned
regulations shall be returned to the company.
Directors, Supervisors and senior management, who directly or indirectly enter into
contracts or conduct transactions with the company, shall report to the board of directors or the
shareholders’ meeting on matters relating to the entering into of such contracts or the conduct
of such transactions, which shall be approved by a resolution of the board of directors or the
shareholders’ meetings in accordance with the provisions of the articles of association of the
company.
Directors, supervisors and senior management shall not use the convenience of their
positions to seek business opportunities belonging to the company for themselves or others,
except in the following circumstances: i) after reporting to the board of directors or the
shareholders’ meetings and a resolution by the board of directors or the shareholders’ meetings
APPENDIX IV SUMMARY OF PRINCIPAL PRC LEGAL AND
REGULATORY PROVISIONS
– IV-20 –


--- page 655 ---
in accordance with the articles of association of the company has been passed; or ii) the
company is unable to take advantage of the business opportunity in accordance with the
provisions of the laws, administrative regulations or the articles of association of the company.
A director, supervisor or senior management who contravenes any law, regulation or the
company’s articles of association in the performance of his duties resulting in any loss to the
company shall be personally liable for the damages to the company.
Finance and Accounting
Under the Company Law, a company shall establish financial and accounting systems
according to laws, administrative regulations and the regulations of the financial department of
the State Council and shall at the end of each financial year prepare a financial and accounting
report which shall be audited by an accounting firm as required by law. The company’s
financial and accounting report shall be prepared in accordance with provisions of the laws,
administrative regulations and the regulations of the financial department of the State Council.
Pursuant to the Company Law, a joint stock limited company shall prepare and make its
financial and accounting reports available at the company for inspection by the shareholders
at least 20 days before the convening of an annual shareholder’ meetings. A joint stock limited
company which has issued shares to the public must also publish its financial and accounting
reports.
When distributing each year’s after-tax profits, it shall set aside 10% of its after-tax
profits into a statutory common reserve fund (except where the fund has reached 50% of its
registered capital). If its statutory common reserve fund is not sufficient to make up losses of
the previous year, profits of the current year shall be applied to make up losses before
allocation is made to the statutory common reserve fund pursuant to the above provisions. After
allocation of the statutory common reserve fund from after-tax profits, it may, upon a
resolution passed at the shareholders’ meetings, allocate discretionary common reserve fund
from after-tax profits. The remaining after-tax profits after making up losses and allocation of
common reserve fund shall be distributed in proportion to the number of shares held by the
shareholders, unless otherwise stipulated in the articles of association. Shares held by the
company shall not be entitled to any distribution of profit.
The premium received through issuance of shares at prices above par value and other
incomes required by the financial department of the State Council to be allocated to the capital
reserve fund shall be allocated to the company’s capital reserve fund. The company’s reserve
fund shall be applied to make up losses of the company, expand its business operations or be
converted to increase the registered capital of the company. Where the reserve fund of a
company is used for making up losses, the discretionary reserve and statutory reserve shall be
firstly used. If losses still cannot be made up, the capital reserve can be used according to the
APPENDIX IV SUMMARY OF PRINCIPAL PRC LEGAL AND
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– IV-21 –


--- page 656 ---
relevant provisions. Upon the conversion of statutory common reserve fund into capital, the
balance of the statutory common reserve fund shall not be less than 25% of the registered
capital of the company before such conversion.
The company shall have no other accounting books except the statutory accounting books.
Its assets shall not be deposited in any accounts opened in the name of any individual.
Appointment and Retirement of Auditors
Pursuant to the Company Law, the appointment or dismissal of accounting firms
responsible for the auditing of the company shall be determined by shareholders’ meetings,
board of directors or board of supervisors in accordance with provisions of articles of
association. The accounting firm should be allowed to make representations when the
shareholders’ meetings, board of directors or the board of supervisors conducts a vote on the
dismissal of the accounting firm. The company should provide true and complete accounting
evidences, books, financial and accounting reports and other accounting data to the accounting
firm it employs without any refusal, withholding and misrepresentation.
The Guidance for Articles of Association provide that the company guarantees to provide
true and complete accounting vouchers, accounting books, financial accounting reports and
other accounting materials to the employed accounting firm, and shall not refuse, conceal or
falsely report. And the audit fee of the accounting firm shall be decided by the shareholders’
meetings.
Profit Distribution
According to the Company Law, a company shall not distribute profits before losses are
covered and the statutory common reserve is drawn.
Merger And Division
According to the Company Law, in the event of merger, the parties to the merger shall enter
into a merger agreement and prepare balance sheet and inventory of assets. The companies shall,
within ten days as of making the decision of merger, notify the creditors, and shall make a public
announcement through a newspaper or the National Enterprise Credit Information Publicity
System within thirty days. The creditors may, within thirty days as of the receipt of the notice or
within forty-five days as of the issuance of the public announcement if it fails to receive a notice,
require the company to clear off its debts or to provide corresponding guarantees. In the case of
a merger, the credits and debts of the parties involved shall be succeeded by the company that
survives the merger or by the newly established company.
In a division, the asset of the company shall be split in an appropriate manner. The
company shall notify its creditors within ten days of making the resolution on the division and
make a public announcement through a newspaper or the National Enterprise Credit
APPENDIX IV SUMMARY OF PRINCIPAL PRC LEGAL AND
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– IV-22 –


--- page 657 ---
Information Publicity System within thirty days. The liabilities of the company which have
accrued prior to the division shall be jointly borne by the separated companies, unless it is
otherwise prescribed by the company and the creditors before the division regarding the
clearance of debts in written agreement.
Where the merger or division of the company involves changes in its registered
particulars, such changes shall be filed with competent company registration authorities.
Where the company is dissolved, the company shall apply for cancellation of its registration
in accordance with the laws. Where a new company is established, the company shall apply for
registration of incorporation in accordance with the laws.
Dissolution and Liquidation
According to the Company Law, a company shall be dissolved by reason of the following:
(i) the term of its operations set down in the articles of association has expired or other events
of dissolution specified in the articles of association occurred; (ii) the shareholders’ meetings
has resolved to dissolve the company; (iii) the company is dissolved by reason of merger or
division; (iv) the business license is revoked, or the company is ordered to close down or be
dissolved; or (v) the company is dissolved by the people’s court in response to the request of
shareholders holding shares that represent more than 10% of the voting rights of all its
shareholders, on the grounds that the company suffers significant hardship in its operation and
management that cannot be resolved through other means, and the ongoing existence of the
company would bring significant losses for shareholders. If any of the situations as mentioned
in the preceding paragraph arises, a company shall publicize the situations through the National
Enterprise Credit Information Publicity System within ten days.
In the event of (i) or (ii) above, a company may carry on its existence by amending its
articles of association or by a resolution of the shareholders’ meetings if it has not distributed
its assets to its shareholders yet. The amendment of the articles of association or resolution of
a shareholders’ meetings in accordance with provisions set out above shall require approval of
more than two thirds of voting rights of shareholders attending a shareholders’ meetings.
Where the company is dissolved in the circumstances described in subparagraphs (i), (ii),
(iv), or (v) above, a liquidation group shall be established. The directors shall be the liquidation
obligors of the company and form a liquidation group to carry out liquidation within 15 days
after the occurrence of an event of dissolution.
The members of the company’s liquidation group shall be composed of its directors
except where the articles of association provide otherwise or the shareholders resolve to elect
another person. If a liquidation group is not established within the stipulated period or fails to
carry out the liquidation after its formation, any interested party may apply to the people’s
court and request the court to appoint relevant personnel to form the liquidation group. The
people’s court should accept such application and form a liquidation group to conduct
liquidation in a timely manner.
APPENDIX IV SUMMARY OF PRINCIPAL PRC LEGAL AND
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--- page 658 ---
The liquidation group shall exercise the following powers during the liquidation period:
(1) to liquidate the company’s assets and to prepare a balance sheet and an inventory of
the assets;
(2) to notify creditors through notice or public announcement;
(3) to deal with the company’s outstanding businesses related to liquidation;
(4) to pay any tax overdue as well as tax amounts arising from the process of
liquidation;
(5) to settle the company’s accounts payable and recover its accounts receivable;
(6) to distribute the company’s remaining assets after its debts have been paid off; and
(7) to represent the company in civil lawsuits.
The liquidation group shall notify the company’s creditors within 10 days after its
establishment and issue public notices in newspapers or on the National Enterprise Credit
Information Publicity System within 60 days. A creditor shall lodge his claim with the
liquidation group within 30 days after receiving notification, or within 45 days of the public
notice if he did not receive any notification. A creditor shall state all matters relevant to his
creditor rights in making his claim and furnish evidence. The liquidation group shall register
such creditor rights. The liquidation group shall not make any debt settlement to creditors
during the period of claim.
Upon liquidation of properties and the preparation of the balance sheet and inventory of
assets, the liquidation group shall draw up a liquidation plan to be submitted to the
shareholders’ meetings or people’s court for confirmation.
The company’s remaining assets after payment of liquidation expenses, wages, social
insurance expenses and statutory compensation, outstanding taxes and debts shall be
distributed to shareholders according to their shareholding proportion. It shall continue to exist
during the liquidation period, although it can only engage in any operating activities that are
related to the liquidation. The company’s properties shall not be distributed to the shareholders
before repayments are made in accordance with the foregoing provisions.
Upon liquidation of the company’s properties and the preparation of the balance sheet and
inventory of assets, if the liquidation group becomes aware that the company does not have
sufficient assets to meet its liabilities, it must apply to the people’s court for a declaration for
bankruptcy.
APPENDIX IV SUMMARY OF PRINCIPAL PRC LEGAL AND
REGULATORY PROVISIONS
– IV-24 –


--- page 659 ---
Following such declaration, the liquidation group shall hand over all matters relating to
he liquidation to the bankruptcy administrator designated by the people’s court.
Upon completion of the liquidation, the liquidation group shall submit a liquidation report
to the shareholders’ meetings or the people’s court for verification. Thereafter, the report shall
be submitted to the registration authority of the company in order to apply for deregistration.
The members of the liquidation group are obliged to perform their liquidation duties with
fidelity and diligence. The members of the liquidation group shall be liable for damages caused
to the company if they are negligent in performing their liquidation duties. A member of the
liquidation group is liable to indemnify the company and its creditors in respect of any loss
arising from his intentional or gross negligence.
Amendments to the Articles of Association
Any amendments to the company’s articles of association must be made in accordance
with the procedures set out in the company’s articles of association. In relation to matters
involving the company’s registration, its registration with the authority must also be changed.
Overseas Listing
According to the Overseas Listing Trial Measures, where an issuer makes an overseas initial
public offering or listing, it shall file with the CSRC within 3 working days after submitting the
application documents for overseas issuance and listing. If an issuer issues securities in the same
overseas market after overseas issuance and listing, it shall file with the CSRC within 3 working
days after the completion of the issuance. If an issuer issues and lists in other overseas markets
after overseas issuance and listing, it shall be filed in accordance with the provisions of the first
paragraph of this article. Moreover, if the filing materials are complete and meet the
requirements, the CSRC shall complete the filing within 20 working days from the date of
receiving the filing materials, and publicize the filing information through the website. If the
filing materials are incomplete or do not meet the requirements, the CSRC shall inform the issuer
of the materials to be supplemented within 5 working days after receiving the filing materials.
The issuer shall supplement the materials within 30 working days.
Loss of Share Certificates
If a share certificate is lost, stolen or destroyed, the relevant shareholder may apply, in
accordance with the relevant provisions set out in the Civil Procedure Law, to a people’s court
o declare such certificate invalid. After the people’s court declares the invalidity of such
certificate, the shareholder may apply to the company for a replacement share certificate.
APPENDIX IV SUMMARY OF PRINCIPAL PRC LEGAL AND
REGULATORY PROVISIONS
– IV-25 –


--- page 660 ---
This appendix contains a summary of the principal provisions of the Articles of
Association of the Company which will be effective from the date of listing of H Shares on the
Hong Kong Stock Exchange. This appendix is primarily intended to provide potential investors
with an overview of the Company’s Articles of Association and therefore may not contain all
the information that is material to potential investors.
SHARES AND REGISTERED CAPITAL
The shares of the Company shall take the form of share certificates. All shares issued by
the Company shall be denominated in Renminbi and have a par value of Renminbi 0.1.
The Company shall issue shares in an open, equitable and fair manner, and each of the
shares in the same class shall carry the same rights. Shares of the same class issued at the same
time shall be issued on the same conditions and at the same price. Any entity or individual shall
pay the same price for each of the shares which it/he/she subscribes for.
INCREASE, REDUCTION AND REPURCHASE OF SHARES
Capital Increase
In light of the Company’s operational and developmental needs, the Company may
increase its capital in accordance with the laws and regulations, and subject to a resolution of
the general shareholders’ meeting, by any of the following methods:
(1) public offering of shares after approval or registration by the relevant authorities;
(2) private placement of shares;
(3) placement or allotment of bonus shares to existing shareholders;
(4) conversion of reserve funds to share capital; or
(5) other methods permitted by laws and administrative regulations.
Capital Reduction
The Company may reduce its registered capital. Any reduction of the Company’s
registered capital shall be subject to the procedures prescribed in the Company Law and other
relevant regulations, the Hong Kong Listing Rules, as well as the Articles of Association.
Transfer of Shares
Shares already issued by the Company before the public offering shall not be transferred
within one year of the date on which the shares of the Company are listed on the stock
exchange.
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
–V - 1–


--- page 661 ---
The directors, supervisors, and senior management of the Company shall declare, to the
Company, the information on their holdings of the shares of the Company (including preferred
shares, if any) and the changes thereto. The shares transferrable by them during each year of
their term of office shall not exceed 25% of the total shares of the same class they hold in the
Company. The shares that they hold in the Company shall not be transferred within one year
of the date on which the shares of the Company are listed and traded. The aforesaid persons
shall not transfer their shares of the Company within half a year from the date of their
resignation.
If the shares are pledged within the period of restriction on transfer prescribed by laws
and administrative regulations, the pledgee shall not exercise the pledge right within the period
of restriction on transfer.
Where the relevant rules of the Hong Kong Stock Exchange contain any other provisions
on the transfer restrictions of H Shares, such provisions shall prevail.
Where the Company’s directors, supervisors, senior management and shareholders who
hold 5% or more of the Company’s shares sell the Company’s shares or other securities with
the nature of equity they hold within six months of the relevant purchase, or purchase any share
they have sold within six months of the relevant sale, the proceeds generated therefrom shall
be incorporated into the profits of the Company, and the Board of Directors of the Company
shall recover the proceeds. However, the following circumstances shall be excluded where a
securities company holds 5% or more of the shares of the Company due to its purchase of any
remaining shares under best efforts underwriting or where the provisions of the CSRC are
listed are applicable. Shares or other securities with the nature of equity held by directors,
supervisors, senior management and natural person shareholders as mentioned in the preceding
paragraph include shares or other securities with the nature of equity held by their spouses,
parents or children, and held by them by using other people’s accounts.
If the Board of Directors of the Company fails to comply with the above paragraph of this
article, the shareholders are entitled to request the Board of Directors to do so within 30 days.
If the Board of Directors of the Company fails to comply within the aforesaid period, the
shareholders are entitled to initiate litigation directly in the people’s court in their own names
for the interest of the Company. If the Board of Directors fails to implement the provisions set
forth in the above paragraph of this article, the responsible directors shall bear joint and several
liability in accordance with law.
REGISTER OF SHAREHOLDERS
The Company shall establish a register of shareholders in accordance with certificates
from the share registrar. The register of shareholders shall be ample evidence of holding of the
Company’s shares by a shareholder. Shareholders shall enjoy rights and assume obligations
according to the class of shares held by him/her; shareholders who hold existing shares of the
same class shall enjoy the equal rights and assume the equal obligations.
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
–V - 2–


--- page 662 ---
When the Company convenes the shareholders’ meeting, distributes dividends, conducts
liquidation or engages in other acts requiring the identification of shareholders, the Board of
Directors or the convener of the shareholders’ meeting should determine the record date. The
shareholders contained in the register of shareholders after the trading hours on the record date
shall be those entitled to the relevant rights and interests.
RIGHTS AND OBLIGATIONS OF SHAREHOLDERS
Shareholders of the Company shall enjoy the following rights:
(1) to receive dividends and profit distributions in any other form in proportion to their
shareholdings;
(2) to lawfully request, convene, preside over, participate in or appoint a shareholder’s
proxy to participate in a shareholders’ meeting in accordance with the law, and to
exercise the corresponding voting rights;
(3) to supervise, present suggestions on or make inquiries about the operations of the
Company;
(4) to transfer, give as a gift or pledge the shares it holds in accordance with laws,
administrative regulations, the Hong Kong Listing Rules and the Articles of
Association;
(5) to inspect the Articles of Association, register of shareholders, corporate bond stubs,
minutes of shareholders’ meetings, resolutions of the Board of Directors, resolutions
of the Supervisory Committee and financial and accounting reports;
(6) in the event of the termination or liquidation of the Company, the right to participate
in the distribution of the remaining property of the Company in proportion to the
number of shares held;
(7) shareholders who object to resolutions of merger or division made by the
shareholders’ meeting may request the Company to purchase the shares they hold;
and
(8) other rights provided for by laws, administrative regulations, departmental rules, the
Hong Kong Listing Rules or the Articles of Association.
Shareholders of the Company shall have the following obligations:
(1) to abide by laws, administrative regulations and the Articles of Association;
(2) to pay the share subscription price based on the shares subscribed for by them and
the method of acquiring such shares;
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
–V - 3–


--- page 663 ---
(3) not to return shares unless prescribed otherwise in laws and regulations;
(4) not to abuse shareholders’ rights to infringe upon the interests of the Company or
other shareholders; not to abuse the Company’s status as an independent legal entity
or the limited liability of shareholders to harm the interests of the Company’s
creditors; and
(5) to assume other obligations required by laws, administrative regulations, the Hong
Kong Listing Rules and the Articles of Association.
Any shareholder who abuses shareholders’ rights and causes the Company or other
shareholders to suffer a loss shall be liable for making compensation in accordance with law;
any shareholder who abuses the status of the Company as an independent legal entity or the
limited liability of shareholders to evade debts and causes sever harms to the interests of the
Company’s creditors shall assume joint and several liability for the Company’s debts.
RESTRICTIONS ON RIGHTS OF THE CONTROLLING SHAREHOLDERS
The controlling shareholders and the actual controllers of the Company shall not use their
connected relationship to act in detriment to the interests of the Company. If they violate such
provision and caused losses to the Company, they shall be liable for compensation.
The controlling shareholders and the actual controllers of the Company shall have
fiduciary duties towards the Company and public shareholders of the Company. The controlling
shareholders shall exercise its rights as a contributor in strict compliance with the laws. The
controlling shareholders shall not do harm the legitimate rights and interests of the Company
and public shareholders by means of profit distribution, asset restructuring, external
investment, fund appropriation and borrowing guarantees, and shall not make use of its
controlling status against the interests of the Company and public shareholders.
SHAREHOLDERS’ MEETINGS
General Provisions of the shareholders’ meetings
The shareholders’ meeting is the organ of authority of the Company and shall exercise the
following functions and powers:
(1) to elect and replace the directors and supervisors who are not employee
representatives and to decide on the matters relating to the remuneration of directors
and supervisors;
(2) to review and approve the reports of the Board of Directors;
(3) to review and approve the reports of the Supervisory Committee;
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
–V - 4–


--- page 664 ---
(4) to review and approve the profit distribution plans and loss recovery plans of the
Company;
(5) to decide on any increase or reduction of the company’s registered capital;
(6) to decide on the issuance of corporate bonds or repurchase of shares;
(7) to decide on merger, division, dissolution and liquidation of the company or change
of its corporate form;
(8) to amend the Articles of Association;
(9) to decide on the Company’s engagement and dismissal of engagement of an
accounting firm;
(10) to review and approve the guarantees prescribed in Article 42 hereof;
(11) to review the purchase or sale of major assets of the Company in excess of 30% of
the Company’s latest audited total assets within one year;
(12) to review and approve changes in the use of proceeds;
(13) to review the equity incentive plans and employee shareholding schemes; and
(14) to review other matters on which decisions shall be made by the shareholders’
meeting as required by laws, administrative regulations, departmental rules, the
Hong Kong Listing Rules and the Articles of Association.
The shareholders’ meetings are classified into annual shareholders’ meetings and
extraordinary shareholders’ meetings. The annual shareholders’ meeting shall be convened
once a year and be held within six months of the end of the previous accounting year.
In any of the following circumstances, the Board of Directors shall convene an
extraordinary shareholders’ meeting within two months from the date of the occurrence of the
circumstance:
(1) the number of directors is less than the number stipulated by the Company Law or
less than two-thirds of the number specified in the articles of association;
(2) the outstanding losses of the company amounted to one-third of the company’s total
paid-up share capital;
(3) shareholders individually or in aggregate holding 10% or more of the company’s
shares request the convening of an extraordinary shareholders’ meeting;
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
–V - 5–


--- page 665 ---
(4) the board deems necessary;
(5) the Supervisory Committee proposes to hold; or
(6) other circumstances as stipulated by laws, administrative regulations, departmental
rules, the Hong Kong Listing Rules, or the Articles of Association.
Convening of shareholders’ meetings
Independent non-executive directors shall be entitled to submit a proposal to the Board
of Directors on holding an extraordinary shareholders’ meeting. For such a proposal, the Board
of Directors shall give a written reply as to whether it agrees or disagrees to hold an
extraordinary shareholders’ meeting within 10 days upon receipt of the proposal in accordance
with laws, administrative regulations, the Hong Kong Listing Rules and the Articles of
Association.
Where the Board of Directors agrees to hold an extraordinary shareholders’ meeting, a
notice of the shareholders’ meeting shall be given within five days after the resolution of the
Board of Directors is made. Where the Board of Directors does not agree to hold such a
meeting, its reasons shall be given and an announcement shall be made.
The Supervisory Committee shall be entitled to submit a proposal in writing to the Board
of Directors on holding an extraordinary shareholders’ meeting. The Board of Directors shall
give a written reply as to whether it agrees or disagrees to hold an extraordinary shareholders’
meeting within 10 days upon receipt of the proposal in accordance with laws, administrative
regulations, the Hong Kong Listing Rules and the Articles of Association.
Where the Board of Directors agrees to hold an extraordinary shareholders’ meeting, a
notice of shareholders’ meeting shall be given within five days after the resolution of the Board
of Directors is made. Any change to the original proposal in the notice shall be subject to the
approval from the Supervisory Committee.
Where the Board of Directors does not agree to hold an extraordinary shareholders’
meeting or fails to give a reply within 10 days upon receipt of the proposal, it shall be deemed
that the Board of Directors is unable or fails to perform its duty of convening a shareholders’
meeting. In such case, the Supervisory Committee may convene and preside over the meeting
on its own.
Shareholders who individually or together hold 10% or more of the shares of the
Company shall have the right to request the Board of Directors to convene an extraordinary
shareholders’ meeting and such request shall be made to the Board of Directors in writing. The
Board of Directors shall give a written reply as to whether it agrees or disagrees to hold an
extraordinary shareholders’ meeting within 10 days upon receipt of the request in accordance
with laws, administrative regulations, the Hong Kong Listing Rules and the Articles of
Association.
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
–V - 6–


--- page 666 ---
Where the Board of Directors agrees to hold an extraordinary shareholders’ meeting, it
shall issue a notice of the shareholders’ meeting within five days after the resolution was made.
Any change to the original request in the notice shall be subject to the approval from the
relevant shareholders.
Where the Board of Directors does not agree to hold an extraordinary shareholders’
meeting or fails to give a reply within 10 days upon receipt of the request, shareholders who
individually or together hold 10% or more of the shares of the Company shall have the right
to submit a proposal to the Supervisory Committee on holding an shareholders’ extraordinary
shareholders’ meeting and such request shall be made to the Supervisory Committee in writing.
Where the Supervisory Committee agrees to hold an extraordinary shareholders’ meeting,
it shall issue a notice of shareholders’ meeting within five days after receiving the request. Any
changes to the original request in the notice shall be approved by the relevant shareholders.
Where the Supervisory Committee fails to give the notice of the shareholders’ meeting
within the specified time limit, it shall be deemed that the Supervisory Committee does not
convene or preside over the meeting, in which case, shareholders who individually or together
hold 10% or more of the shares of the Company for 90 or more consecutive days may convene
and preside over the meeting on their own.
Proposals of Shareholders’ Meeting
When the Company convenes a shareholders’ meeting, the Board of Directors, the
Supervisory Committee and shareholders who individually or together hold 1% or more of the
shares of the Company are entitled to put forward a proposal to the Company.
Shareholders individually or together holding 1% or more of the shares of the Company
can put forward a temporary proposal 10 days before the shareholders’ meeting is held and
submit the proposal to the convener of the meeting in writing. The convener shall issue a
supplemental notice within two days upon receiving such proposal and notify shareholders of
the content of such proposal.
Except for the circumstances prescribed in the preceding paragraph, the convener shall
not change the proposals specified in the notice of the shareholders’ meeting or add new
proposals after sending the notice of the shareholders’ meeting.
The shareholders’ meeting shall not vote or resolve on proposals not contained in the
notice of the shareholders’ meeting or not in compliance with the Articles of Association.
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
–V - 7–


--- page 667 ---
Notification of Shareholders’ Meeting
For an annual shareholders’ meeting, the convenor shall notify the shareholders by way
of public announcement at least 21 days before the meeting is held; for an extraordinary
shareholders’ meeting, the convenor shall notify the shareholders by way of public
announcement at least 15 days before the meeting is held. The above period shall not include
the day on which the meeting is convened. Where otherwise provided by laws, administrative
regulations and the rules of securities supervision of the place where the Company’s shares are
listed, such provisions shall apply.
Holding of Shareholders’ Meeting
All shareholders whose names appear on the register of shareholders on the record date
or their proxies are entitled to attend the shareholders’ meeting and exercise their rights of
speaking and voting in accordance with relevant laws, regulations, the Hong Kong Listing
Rules and the Articles of Association.
An individual shareholder who attends the meeting in person shall produce his/her own
identification card or other valid documents or proof evidencing his/her identity. If a
shareholder appoints a proxy to attend the meeting on his/her behalf, such proxy shall produce
his/her own valid proof of identity and the power of attorney from the shareholder.
A corporate shareholder shall attend the meeting by its legal representative or proxy
appointed by the legal representative. Where the legal representative attends the meeting,
he/she shall produce his/her own identification card, valid certificates evidencing his/her
capacity as the legal representative. Where a proxy is appointed to attend the meeting, he/she
shall produce his/her own identification card, the written power of attorney issued by the legal
representative of the corporate or institutional shareholder according to law.
The shareholders of an unincorporated organization shall be represented at the meeting by
the person in charge (in the case where the shareholders of an unincorporated organization are
a partnership, the person in charge shall be the managing partner if the managing partner is a
natural person, and the person in charge shall be the appointed representative of the managing
partner if the managing partner is a legal person or an unincorporated organization; the same
shall apply hereinafter), or by an agent entrusted by the person in charge. If the person in
charge attends the meeting, he/she shall present his/her identity card, valid proof of his/her
qualification as a person in charge and the corresponding shareholding certificate; if he/she
entrusts a proxy to attend the meeting, the proxy shall present his/her identity card, the original
written power of attorney issued by the person in charge of the shareholders of an
unincorporated organization in accordance with the law (with the shareholders of the
unincorporated organization stamped with the official seal at the same time) and the
corresponding shareholding certificate.
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
–V - 8–


--- page 668 ---
If the shareholder is a recognized clearing house (or its nominee) as defined in the
relevant ordinances enacted in Hong Kong from time to time, such shareholder may authorize
one or more persons as he/she deems appropriate to act on his/her behalf at any shareholders’
meetings and creditors’ meeting; however, if more than one persons are thus authorized, the
power of attorney shall specify the numbers and classes of shares in respect of which such
persons are authorized, and signed by the authorized person of the recognized clearing house.
The person(s) so authorized may attend the meeting and exercise the rights on behalf of the
recognized clearing house (or its nominee) without producing certificates of shareholding, the
notarized power of attorney and/or further evidence to prove that he/she has been duly
authorized as if such person is an individual shareholder of the Company.
Resolution at the Shareholders’ Meeting
The resolutions of the shareholders’ meeting shall be divided into ordinary resolutions
and special resolutions. An ordinary resolution shall be adopted by a simple majority of the
votes held by the shareholders (including proxies of shareholders) attending the shareholders’
meeting. A special resolution shall be adopted by a two-thirds or more of the votes held by the
shareholders (including proxies of shareholders) attending the shareholders’ meeting.
The following matters shall be approved by the shareholders’ meeting through ordinary
resolutions:
(1) work report of the Board of Directors and the Supervisory Committee;
(2) annual report of the Company;
(3) the profit distribution plans and loss recovery plans drafted by the Board of
directors;
(4) appointment and removal of members of the Board of Directors and the Supervisory
Committee who are not employee representatives, as well as their payment and
method of payment; and
(5) other matters other than those approved by special resolution stipulated in the laws,
administrative regulations, the Hong Kong Listing Rules and the Articles of
Association.
The following matters shall be approved by special resolution at the shareholders’
meeting:
(1) the increase or reduction of the registered capital of the Company;
(2) merger, division, separation, dissolution, liquidation or change of corporate form of
the Company;
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
–V - 9–


--- page 669 ---
(3) the amendment to the Articles of Association;
(4) the purchases or sales of material assets by the Company within one year or the
guarantee amount exceeding 30% of the latest audited total assets of the Company;
(5) the share incentive plan; and
(6) other matters stipulated by laws, administrative regulations, the Hong Kong Listing
Rules, or the Articles of Association, as well as other matters that the shareholders’
meeting determines by ordinary resolution will have a significant impact on the
Company and need to be passed by special resolution.
DIRECTORS AND BOARD OF DIRECTORS
Directors
Directors shall be elected or replaced by the shareholders’ meeting and may be removed
from office by the shareholders’ meeting before the expiration of their terms of office. The term
of office of a director shall be three years, and he/she may be re-elected upon expiration of the
term of office, unless otherwise provided by relevant laws, regulations, or rules of securities
supervision of the place where the company’s shares are listed.
The term of office of a director shall commence from the date on which the said director
assumes office until the expiry of the term of office of the current session of the Board of
Directors. A director shall continue to perform his/her duties as a director in accordance with
laws, administrative regulations, departmental rules, the Hong Kong Listing Rules and the
Articles of Association until a duly re-elected director takes office, if re-election is not
conducted in a timely manner upon the expiry of his/her term of office.
Board of Directors
The Company shall have a Board of Directors. The Board of Directors shall consist of
nine directors, four of whom shall be independent non-executive directors, and at all times the
independent non-executive directors shall constitute one-third or more of the total number of
the Board of Directors. At least one of the independent non-executive directors shall have
appropriate professional qualifications and one of the independent non-executive directors
shall ordinarily reside in Hong Kong.
The Board of Directors shall exercise the following functions and powers:
(1) to convene shareholders’ meetings and report on its work to the shareholders’
meetings;
(2) to implement resolutions of the shareholders’ meeting;
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
– V-10 –


--- page 670 ---
(3) to decide on the Company’s operational plans and investment proposals;
(4) to formulate the Company’s profit distribution proposals and loss recovery
proposals;
(5) to formulate proposals for the increase or reduction of the registered capital,
debentures or other securities of the Company and the listing plan of the Company;
(6) to formulate plans for the Company’s major acquisition, repurchase of the shares of
the Company, or merger, division, dissolution or change of corporate form of the
Company;
(7) to decide on matters such as investments, purchase and sale of assets, pledge of
assets, external guarantee, entrustment of financial management, connected
transactions and donations of the Company within the scope of authorization by the
shareholders’ meeting;
(8) to decide on establishment of internal management organs of the Company;
(9) to decide on the appointment or dismissal of the Company’s general manager,
secretary to the Board of Directors and other members of the senior management and
decide on matters of their remuneration; according to the nomination of the general
manager, decide to appoint or dismiss the Company’s deputy general manager, chief
financial officer and other senior management, and decide on matters of their
remuneration;
(10) to formulate the basic management system of the Company;
(11) to formulate proposals to amend the Articles of Association;
(12) to manage the Company’s information disclosures;
(13) to propose to the shareholders’ meeting the appointment or replacement of the
accounting firm that provides audit service to the Company;
(14) to listen to the work report of the general manager of the Company and to inspect
the work of the general manager; and
(15) other powers and functions stipulated by laws, administrative regulations,
departmental rules or these Articles of Association and granted by the shareholders’
meeting.
Matters beyond the scope of authorization of the shareholders’ meeting shall be submitted
to the shareholders’ meeting for deliberation.
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
–V - 1 1–


--- page 671 ---
SENIOR MANAGEMENT
General Manager
The Company shall have one general manager, who shall be appointed or dismissed by the
Board of Directors, and exercise the following functions and powers:
(1) to be in charge of the production, operation and management of the Company, to
organize the implementation of the resolutions of the Board of Directors, and to
report his/her works to the Board of Directors;
(2) to organize the implementation of the Company’s annual business plans and
investment plans;
(3) to draft plans for the establishment of the Company’s internal management
organization;
(4) to draft the Company’s basic management system;
(5) to formulate the specific rules and regulations of the Company;
(6) to propose to the Board of Directors the appointment or dismissal of the Company’s
deputy general manager, financial controller and other senior management
personnel;
(7) to decide on appointment or dismissal of management personnel other than those
required to be appointed or dismissed by the Board of Directors; and
(8) other functions and powers conferred by the Articles of Association or the Board of
Directors.
The general manager attends the meetings of the Board of Directors, and the non-director
general manager has no voting rights in the Board of Directors.
Secretary to the Board of Directors
The Company shall have a secretary to the Board of Directors, who is responsible for
preparing for the shareholders’ meeting and the meetings of the Board of Directors, keeping
documents and shareholders’ materials and handling matters relating to information disclosure,
investor relations, etc.
The secretary of the Board shall comply with the relevant provisions of laws,
administrative regulations, departmental rules, the Hong Kong Listing Rules and these Articles
of Association.
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
– V-12 –


--- page 672 ---
SUPERVISORY COMMITTEE
The Company shall have a Supervisory Committee. The Supervisory Committee shall
consist of three supervisors, including two shareholder representatives and one employee
representative of the Company. Employee representatives on the Supervisory Committee shall
be democratically elected by the Company’s employees through the Employee Congress,
Employee Assembly or other forms.
The Supervisory Committee shall have a Chairman of the Supervisory Committee. The
Chairman of the Supervisory Committee shall be elected by a majority of all Supervisors. The
Chairman of the Supervisory committee shall convene and preside over the meetings of the
Supervisory committee. If the Chairman of the Supervisory committee is unable to perform his
duties or fails to perform his duties, more than half of the Supervisors shall jointly elect a
Supervisor to convene and preside over the meetings of the Supervisory committee.
The Supervisory Committee shall exercise the following functions and powers:
(1) to review and give written opinions on the periodic reports of the Company prepared
by the Board of Directors;
(2) to review the company’s financial position;
(3) to supervise the directors and senior management in their performance of their
duties and to propose the removal of directors and senior management who have
violated laws, regulations, the articles of association or the resolutions of
shareholders’ meeting;
(4) when the acts of directors and senior management are harmful to the company’s
interests, to require correction of those acts;
(5) to propose the convening of extraordinary shareholders’ meetings and to convene
and preside over shareholders’ meetings when the board of directors fails to perform
the duty of convening and presiding over shareholders’ meeting under the Company
Law;
(6) to initiate proposals for resolutions to shareholders’ meeting;
(7) to initiate proceedings against directors and senior management in accordance with
the Company Law;
(8) in case of any abnormal matters during the business operation of the Company, to
investigate, and if necessary, to engage professionals such as accounting firms or
law firms to assist its work with expenses being borne by the Company; and
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
– V-13 –


--- page 673 ---
(9) other powers and functions prescribed by laws, administrative regulations, the Hong
Kong Listing Rules and these Articles or granted by the shareholders’ meeting.
FINANCIAL AND ACCOUNTING SYSTEMS
The Company shall develop its financial and accounting systems pursuant to laws,
administrative regulations and the requirements of the competent authorities of China.
NOTICE
The notices of the Company may be sent out in the following manner:
(1) by personal delivery;
(2) by express mail;
(3) by mail, e-mail, or facsimile;
(4) by announcement;
(5) by publishing the information on the websites designated by the Company and the
Hong Kong Stock Exchange, subject to compliance with laws and regulations and
the rules of securities regulation of the place where the Company’s shares are listed;
(6) in such other form as may be agreed upon in advance by the Company or the person
to be notified or recognized by the person to be notified upon receipt of the notice;
or
(7) in any other form prescribed by laws, administrative regulations, departmental rules
and these Articles of Association.
DISSOLUTION AND LIQUIDATION OF THE COMPANY
The Company may be dissolved for the following reasons:
(1) the circumstances for dissolution as stipulated by the Articles of Association arise;
(2) the shareholders’ meeting resolves to dissolve the Company;
(3) dissolution is necessary as a result of the merger or division of the Company;
(4) the business license is revoked or it is ordered to close down or it is deregistered
according to law; or
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
– V-14 –


--- page 674 ---
(5) serious difficulties arise in the operation and management of the Company and its
continued existence would cause material loss to the interests of the shareholders
and such difficulties cannot be resolved through other means, in which case
shareholders holding 10% or more of all shareholders’ voting rights of the Company
may petition a people’s court to dissolve the Company.
If the company is dissolved due to the provisions of the above items (1), (2), (4) and (5)
of these Articles of Association, it shall be liquidated. The directors shall be the obligors of the
company’s liquidation and shall form a liquidation group to carry out the liquidation within 15
days from the date when the cause of dissolution arises. The liquidation group shall consist of
the directors, unless the shareholders’ meeting resolves to elect another person. If the
liquidation obligor fails to fulfill the liquidation obligation in time and causes losses to the
company or creditors, he shall be liable for compensation.
AMENDMENTS TO THE ARTICLES OF ASSOCIATION
The Company shall amend the Articles of Association in any of the following
circumstances:
(1) after amendments are made to the Company Law, or relevant laws, administrative
regulations and the Hong Kong Listing Rules, the Articles of Association run
counter to the amended laws, administrative regulations and the Hong Kong Listing
Rule;
(2) the conditions of the Company have changed, and such changes are inconsistent
with the matters stipulated in the Articles of Association; or
(3) the shareholders’ meeting has resolved to amend the Articles of Association.
Where the amendments to the Articles of Association passed by the shareholders’
meetings need the examination and approval of the competent authorities, these amendments
shall be submitted thereto for approval. Where the amendment of the Articles of Association
involves registration, it shall be necessary to carry out the lawfully prescribed procedures for
registration change.
APPENDIX V SUMMARY OF THE ARTICLES OF ASSOCIATION
– V-15 –


--- page 675 ---
A. FURTHER INFORMATION ABOUT OUR GROUP
1. Establishment of our Company
Our Company was established in the PRC on December 19, 2014 and was converted to a
joint stock company with limited liability under the PRC Company Law with effect from
November 1, 2024. Our Company has established a principal place of business in Hong Kong at
3/F, Building 2W, Science Park Avenue, Hong Kong Science Park, Shatin, New Territories, Hong
Kong and was registered with the Registrar of Companies in Hong Kong as a non-Hong Kong
company in Hong Kong under Part 16 of the Companies Ordinance on December 18, 2024. Mr.
Li Kin Wai (۾one of our joint company secretaries, has been appointed as the authorized
representative of our Company for the acceptance of service of process and notices on behalf of
our Company in Hong Kong. As our Company was incorporated in the PRC, our corporate
structure and Articles of Association are subject to the relevant laws and regulations of the PRC.
A summary of the relevant provisions of our Articles of Association is set out in “Summary of
the Articles of Association” in Appendix V to this prospectus. A summary of certain relevant
aspects of the laws and regulations of the PRC is set out in the section headed “Summary of
Principal PRC Legal and Regulatory Provisions” in Appendix IV to this prospectus.
2. Changes in the share capital of our Company
The following sets out the changes in the share capital of our Company within the two
years immediately preceding the date of this prospectus:
– on July 16, 2024, Y angtze Hong Kong subscribed for 0.66% equity interests
(RMB77,994) in an amount of RMB10.65 million. Upon completion of the
subscription, the registered capital of our Company increased from approximately
RMB11.71 million to RMB11.79 million;
– on November 1, 2024, our Company was converted into a joint stock company with
limited liability under the PRC Company Law. Upon completion of such conversion,
the registered capital of our Company was RMB11,789,783 divided into 11,789,783
Shares with a nominal value of RMB1.00 each;
– as approved by our Shareholders’ meeting held on November 15, 2024, immediately
upon Listing, the ordinary shares of our Company were split on a one-for-ten basis,
and the par value of the Shares was changed from RMB1 per Share to RMB0.1 per
Share. Immediately after the Global Offering (assuming the Share Split is
completed), and the Over-allotment Option is not exercised, the registered share
capital of the Company became RMB11,789,783 divided into 117,897,830 Shares of
par value RMB0.1 each, all of which were fully paid up; and
– immediately following the completion of the Global Offering, the Share Split and
Conversion of the Unlisted Shares into H Shares, the registered share capital of our
Company will be increased to RMB13,621,883 divided into 136,218,830 H Shares
fully paid up or credited as fully paid up.
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-1 –


--- page 676 ---
Save as aforesaid and as disclosed in the paragraph headed “4. Resolutions of our
Shareholders passed on November 15, 2024” below, there has been no alteration in our share
capital within the two years immediately preceding the date of this prospectus.
3. Restriction of share repurchase
For details of the restrictions on the share repurchase by our Company, please refer to the
section headed “Summary of the Articles of Association” in Appendix V to this prospectus.
4. Resolutions of our Shareholders passed on November 15, 2024
At the extraordinary shareholders’ meeting of our Company held on November 15, 2024,
among other things, the following resolutions were passed by our Shareholders:
(a) immediately upon Listing, the ordinary Shares of the Company will be split on a
one-for-ten basis, and the nominal value of the Shares will be changed from RMB1
each to RMB0.1 each;
(b) the issue of H Shares with a nominal value of RMB0.1 each and such H Shares to
be listed on the Stock Exchange was approved;
(c) the number of H Shares to be issued shall be no more than 15% of the total issued
share capital of our Company upon completion of the Global Offering;
(d) subject to the completion of the filing procedure with the CSRC, upon completion
of the Global Offering, the Share Split and Conversion of the Unlisted Shares in
aggregate into H Shares on a one-for-one basis was approved;
(e) subject to the completion of the Global Offering, the Articles of Association were
approved and adopted, which shall become effective on the Listing, and our Board
has been authorized to amend the Articles of Association in accordance with any
comments from the Stock Exchange and the relevant PRC regulatory authorities;
and
(f) our Board has been authorized to handle all relevant matters relating to, among other
things, the Global Offering, the issue of H Shares and the Listing.
5. Particulars of our subsidiaries
Please refer to the paragraph headed “History, Development and Corporate Structure —
Our major subsidiaries and major shareholding changes” and note 1 of the Accountants’ Report
for further information of our subsidiaries.
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-2 –


--- page 677 ---
6. Change in the registered capital of our subsidiaries
Save as disclosed in “History, Development and Corporate Structure — Our major
subsidiaries and major shareholding changes” in this prospectus, there has been no other
alteration in the registered capital of any of our subsidiaries within the two years immediately
preceding the date of this prospectus.
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 prospectus that are
or may be material:
(a) the Deed of Non-competition;
(b) the cornerstone investment agreement dated December 11, 2025 entered into among
our Company, TFI Investment Fund SPC (acting for and on behalf of its segregated
portfolio, TFI Lakeside SP), ICBC International Capital Limited and ICBC
International Securities Limited, pursuant to which TFI Investment Fund SPC
(acting for and on behalf of its segregated portfolio, TFI Lakeside SP) agreed to
subscribe for Offer Shares at the Offer Price in the aggregate amount of HK$10
million in accordance with the terms of the cornerstone investment agreement;
(c) the cornerstone investment agreement dated December 11, 2025 entered into among
our Company, Awaken Thunder Capital Limited, ICBC International Capital
Limited, ICBC International Securities Limited and China Securities (International)
Corporate Finance Company Limited, pursuant to which Awaken Thunder Capital
Limited agreed to subscribe for Offer Shares at the Offer Price in the aggregate
amount of HK$4 million in accordance with the terms of the cornerstone investment
agreement;
(d) the cornerstone investment agreement dated December 11, 2025 entered into among
our Company, Fund Resources Investment Holding Group Company Limited, ICBC
International Capital Limited and ICBC International Securities Limited, pursuant to
which Fund Resources Investment Holding Group Company Limited agreed to
subscribe for Offer Shares at the Offer Price in the aggregate amount of the Hong
Kong dollar equivalent of US$5 million in accordance with the terms of the
cornerstone investment agreement;
(e) the cornerstone investment agreement dated December 11, 2025 entered into among
our Company, YStem Holding Limited, ICBC International Capital Limited and
ICBC International Securities Limited, pursuant to which YStem Holding Limited
agreed to subscribe for Offer Shares at the Offer Price in the aggregate amount of
the Hong Kong dollar equivalent of US$1 million in accordance with the terms of
the cornerstone investment agreement;
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-3 –


--- page 678 ---
(f) the cornerstone investment agreement dated December 11, 2025 entered into among
our Company, Main Source Capital Limited, ICBC International Capital Limited and
ICBC International Securities Limited, pursuant to which Main Source Capital
Limited agreed to subscribe for Offer Shares at the Offer Price in the aggregate
amount of HK$10 million in accordance with the terms of the cornerstone
investment agreement;
(g) the cornerstone investment agreement dated December 11, 2025 entered into among
our Company, Guotai Junan Investments (Hong Kong) Limited, ICBC International
Capital Limited, ICBC International Securities Limited and Haitong International
Securities Company Limited, pursuant to which Guotai Junan Investments (Hong
Kong) Limited agreed to subscribe for Offer Shares at the Offer Price in the
aggregate amount of the Hong Kong dollar equivalent of RMB10 million in
accordance with the terms of the cornerstone investment agreement;
(h) the cornerstone investment agreement dated December 11, 2025 entered into among
our Company, Sage Partners Master Fund, ICBC International Capital Limited and
ICBC International Securities Limited, pursuant to which Sage Partners Master
Fund agreed to subscribe for Offer Shares at the Offer Price in the aggregate amount
of the Hong Kong dollar equivalent of US$1.5 million in accordance with the terms
of the cornerstone investment agreement; and
(i) the Hong Kong Underwriting Agreement.
2. Our Intellectual Property Rights
(a) Trademarks
As of the Latest Practicable Date, our Group was the registered proprietor of the
following trademarks which, in the opinion of our Directors, were material to our business:
No Trademark
Place of
registration
Name of
registered
proprietor Class
Registration
number
Date of
registration Expiry date
1/H1118/H1118/H1118
 PRC the Company 42 76738432 February 1,
2024
July 27, 2034
2/H1118/H1118/H1118
 PRC the Company 10 76738910 February 1,
2024
July 27, 2034
3 /H1118/H1118
 PRC the Company 44 76738426 February 1,
2024
July 20, 2034
4 /H1118/H1118
 PRC the Company 5 76726804 February 1,
2024
July 20, 2034
5 /H1118/H1118
 PRC the Company 41 76731319 February 1,
2024
July 27, 2034
6 /H1118/H1118
 PRC the Company 35 76732539 February 1,
2024
July 20, 2034
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-4 –


--- page 679 ---
No Trademark
Place of
registration
Name of
registered
proprietor Class
Registration
number
Date of
registration Expiry date
7/H1118/H1118/H1118
 PRC the Company 5 82265587 June 21, 2025 June 20, 2035
8/H1118/H1118/H1118
 PRC the Company 42 82257397 June 14, 2025 June 13, 2035
9 /H1118/H1118
 PRC the Company 42 82262787 September 14,
2025
September 13,
2035
As at the Latest Practicable Date, two applications in the Hong Kong had been made for
the registrations of the following trademarks:
No. Trademark Applicant Class
Place of
Application
Application
date
Application
Number
1 /H1118/H1118/H1118
 our Company 5, 16 Hong Kong November 20,
2024
306731875
2 /H1118/H1118/H1118/H1118
 our Company 5, 16 Hong Kong November 20,
2024
306731866
(b) Patents
As of the Latest Practicable Date, our Group had registered the following patents which,
in the opinion of our Directors, were material to our business:
No. Patent title
Name of
registered
proprietor
Patent
category
Place of
registration Patent number
Date of
application
1 /H1118/H1118/H1118Anti-PD-1/CD47 Bispecific
anti-bodies and its
application
Hangzhou
Hanx
Invention PRC ZL201711298703.7 December 8,
2017
2 /H1118/H1118/H1118Anti-OX40 monoclonal anti-
body and its application
Hangzhou
Hanx
Invention PRC ZL201811593852.0 December 25,
2018
As of the Latest Practicable Date, we had not applied for any patents which, in the opinion
of our Directors, material to our business.
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-5 –


--- page 680 ---
(c) Domain names
As of the Latest Practicable Date, our Group had registered the following domain names
which, in the opinion of our Directors, were material to our business:
No. Domain name Registered owner Date of registration Expiry date
1 /H1118/H1118/H1118/H1118/H1118/H1118hanxbio.cn the Company December 4, 2016 December 4, 2026
2 /H1118/H1118/H1118/H1118/H1118/H1118hanxbio.com the Company December 4, 2016 December 4, 2026
3 /H1118/H1118/H1118/H1118/H1118/H1118hanxbio.com.cn the Company December 4, 2016 December 4, 2026
C. FURTHER INFORMATION ABOUT DIRECTORS, SUPERVISORS AND
SUBSTANTIAL SHAREHOLDERS
1. Disclosure of interests
(a) Interests and short positions of the Directors, Supervisors and the chief executive of
our Company in the registered capital of our Company and its associated corporations
Immediately following the completion of the Global Offering, Share Split and the
Conversion of Unlisted Shares into H Shares, the interests or short positions of Directors,
Supervisors or chief executive of our Company in the Shares, underlying Shares and debentures
of our Company or its associated corporations (within the meaning of Part XV of the SFO) which
will be required to be notified to our Company 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 out in
Appendix C3 to the Listing Rules (the “ Model Code ”), to be notified to our Company and the
Stock Exchange once the H Shares are listed will be as follows:
Interest in Shares of our Company
Name
Nature of
interest
Type of
Shares
Number of
Shares
Approximate
percentage of
shareholding in
the total issued
share capital
Dr. Zhang /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Interest in controlled
corporations 1
H Shares 76,138,710 55.89%
Ms. Xiao /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Beneficial owner H Shares 11,100 0.0081%
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-6 –


--- page 681 ---
Note:
1. The 76,138,710 Shares consist of: (i) 55,300,000 Shares held by CZ Biotechnology; (ii) 17,793,640
Shares held by Hanx Biopharmaceuticals (HK); and (iii) 3,045,070 Shares held by Wuhan Hanx.
CZ Biotechnology is legally and beneficially owned as to 99.9% by Dr. Zhang and 0.1% by Ms. Luo
Fang. CZ Biotechnology, Ms. Luo Fang and Dr. Zhang are considered as a group of controlling
shareholders of our Group pursuant to the Listing Rules. Hanx Biopharmaceuticals (HK) is controlled
by HanxBio (BVI), which is in turn controlled by Hanx Biopharmaceuticals. Hanx Biopharmaceuticals
is controlled by Caizhang Vision, which is controlled by Dr. Zhang. Furthermore, Wuhan Hanx is owned
as to 75% by CZ Biotechnology, which is also the general partner of Wuhan Hanx. Therefore, Dr. Zhang
is deemed to be interested in the 76,138,710 Shares.
(b) Substantial Shareholders
Save as disclosed in the section headed “Substantial Shareholders” in this prospectus, our
Directors are not aware of any persons (other than our Directors, Supervisors and chief
executive of our Company) who will, immediately following the completion of the Global
Offering, will have or be deemed or taken to have interests and/or short position in our Shares
or underlying Shares which would be required to be disclosed under 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 types of the issued voting shares of any member of our Group.
2. Particulars of Directors’ and Supervisors’ service agreements and letters of
appointment
Each of our Directors and Supervisors has entered into a service agreement or letter of
appointment with our Company. The principal particulars of these service agreements and
letters of appointment comprise (a) the term of the service; (b) termination provisions; and (c)
dispute resolution provision. The service agreements and letters of appointment may be
renewed in accordance with our Articles of Association and the applicable laws, rules and
regulations from time to time.
Save as disclosed above, none of our Directors or Supervisors has or is proposed to have
a service agreement with any member of our Group (other than contracts expiring or
determinable by the relevant employer within one year without the payment of compensation
(other than statutory compensation)).
3. Directors’ and Supervisors’ remuneration
For the two years ended December 31, 2023 and 2024 and the eight months ended August
31, 2025, the aggregate remuneration (including salaries, allowances, benefits in kind,
discretionary bonuses, retirement scheme contributions and share-based payments) paid or
payable to our Directors, Supervisors, and senior management were approximately RMB1.9
million, RMB18.3 million and RMB14.4 million, respectively. For details, please refer to note
9 of the Accountants’ Report set out in Appendix I to this prospectus.
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-7 –


--- page 682 ---
Under the arrangement currently in force, the aggregate remuneration (including salaries,
allowances, benefits in kind, discretionary bonuses, retirement scheme contributions and
share-based payments) of our Directors, Supervisors, and senior management for the year
ending December 31, 2025 is estimated to be no more than RMB26.9 million.
4. Agency fees or commissions received
Save as disclosed in the section headed “Underwriting” in this prospectus, no
commissions, discounts, agency fee, brokerages or other special terms were granted 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 prospectus.
5. Disclaimers
(a) save as disclosed in this section, none of our Directors, Supervisors or chief
executive of our Company has any interest or short position in our shares,
underlying shares or debentures of our Company or any of its associated corporation
(within the meaning of the SFO) which will have to be notified to our Company and
the Stock Exchange pursuant to Division 7 and 8 of Part XV of the SFO or which
will be required, pursuant to section 352 of the SFO, to be entered in the register
referred to therein, or which will be required to be notified to our Company and the
Stock Exchange pursuant to the Model Code for Securities Transactions by Directors
of Listed Issuers once our H Shares are listed on the Stock Exchange;
(b) within the two years immediately preceding the date of this prospectus, none of our
Directors or Supervisors nor any of the experts referred to under the paragraph
headed “E. Other Information — 6. Qualifications and consents of experts” in this
appendix has any direct or indirect interest in the promotion of our Company, or in
any assets which have been acquired or disposed of by or leased to any member of
our Group, or are proposed to be acquired or disposed of by or leased to any member
of our Group;
(c) none of our Directors or Supervisors nor any of the experts referred to under the
paragraph headed “E. Other Information — 6. Qualifications and consents of
experts” in this appendix, is materially interested in any contract or arrangement
subsisting at the date of this prospectus which is significant in relation to the
business of our Group taken as a whole;
(d) save as disclosed in this section, none of our Directors or Supervisors has any
existing or proposed service contracts with any member of our Group (excluding
contracts expiring or determinable by the employer within one year without payment
of compensation (other than statutory compensation));
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-8 –


--- page 683 ---
(e) save as disclosed in the section headed “Substantial Shareholders” in this prospectus
and the paragraph headed “C. Further information about Directors, Supervisors and
Substantial Shareholders — 1. Disclosure of interests” in this appendix above, none
of our Directors or Supervisors knows of any person (not being a Director,
Supervisor or chief executive of our Company) who will, immediately following the
completion of the Global Offering, have an interest or short position in our Shares
or underlying Shares which would fall to be disclosed under the provisions of
Division 2 and 3 of Part XV of SFO or be interested, directly or indirectly, in 10%
or more of the issued voting shares of any member of our Group; and
(f) so far as is known to our Directors as of the Latest Practicable Date, none of our
Directors, Supervisors or their respective close associates (as defined under the
Listing Rules) or our Shareholders who are interested in more than 5% of the issued
share capital of our Company has any interests in any of our top five suppliers.
D. EMPLOYEE SHARE INCENTIVE SCHEME
Our Stock Incentive Plan
The following is a summary of the principal terms of the stock incentive plan, which
includes stock option incentive plan (the “ Stock Option Incentive Plan ”) and the restricted
share incentive scheme (the “ Restricted Share Incentive Scheme ”). Given no further share
option will be granted under the Stock Option Incentive Plan and no further restricted shares
unit will be granted under the Restricted Share Incentive Scheme after the Listing, the terms
of the Stock Option Incentive Plan and the Restricted Share Incentive Scheme are not subject
to the provisions of Chapter 17 of the Listing Rules.
A. Stock Option Incentive Plan
(i) Purpose
The purpose of the Stock Option Incentive Plan is to improve our Group’s corporate
governance structure and incentive mechanism, ascertain the contribution made by our
employees to our Group, incentivize our Group’s management and key employees to enhance
the competitiveness of our Group to ensure realization of our Group’s future development
strategy and business targets. The Stock Option Incentive Plan is implemented to align the
interests of the Shareholders with the interests of our Group and employee which will benefit
the sustained development of our Group.
(ii) Administration
The Stock Option Incentive Plan is subject to the approval of the Shareholders’ meeting,
administration of the Board and the supervision of the board of Supervisors.
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-9 –


--- page 684 ---
(iii) Participants
The participants of the Stock Option Incentive Plan include key personnel of our Group
(including our executive Director, our Supervisor, our senior management and other
employees).
(iv) Maximum number of options and shares
The Stock Option Incentive Plan consists of: (i) options to subscribe for 304,507 Shares
(which will become 3,045,070 H Shares upon Listing) granted to the eligible PRC employees
(the “ PRC Stock Options ”); and (ii) options to subscribe for approximately 1,533,407 Shares
(which will become 15,334,075 H Shares upon Listing) granted to the eligible foreign and
Hong Kong employees (the “ Foreign and Hong Kong Stock Options ”). In relation to the PRC
Stock Options, they represent the right to purchase units of the Wuhan Hanx within the exercise
period at the exercise price; in relation to each of the Foreign and Hong Kong Stock Options,
they represent the right to subscribe shares of HanxBio (BVI) within the exercise period at the
exercise price.
The maximum number of Shares the grantees entitled to subscribed for under the PRC
Stock Options is 304,507 Shares (which will become 3,045,070 H Shares upon completion of
the Share Split and the Global Offering), which represents the number of Unlisted Shares
transferred from Hanx Biopharmaceuticals (HK) to Wuhan Hanx at a consideration of
RMB2,785,594 on September 29, 2024. The maximum number of Shares the grantees entitled
to subscribed for under the Foreign and Hong Kong Stock Options is approximately 1,533,407
Shares (which will become 15,334,075 H Shares upon completion of the Share Split and the
Global Offering).
As of the Latest Practicable Date, all the Unlisted Shares, which will be converted into
H Shares upon Listing, to be granted under the PRC Stock Options have been transferred to
Wuhan Hanx by Hanx Biopharmaceuticals (HK). The eligible employees of the PRC Stock
Options and the Foreign and Hong Kong Stock Options will not be entitled to any rights to the
Shares underlying the PRC Stock Options and the Foreign and Hong Kong Stock Options
before the exercise of the PRC Stock Options and the Foreign and Hong Kong Stock Options
(the “ Underlying Shares ”). Upon exercise of the PRC Stock Options and the Foreign and
Hong Kong Stock Options, the eligible employees will be entitled to the economic benefits of
the Underlying Shares. Furthermore, the eligible employees should entrust the rights other than
the economic rights of the Underlying Shares to the person as appointed by our Company.
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-10 –


--- page 685 ---
(v) Date of grant and duration
The date on which the options are granted shall be the date of grant agreement entered
into between our Group and the eligible employees. As of the Latest Practicable Date, all the
options have been granted. The Stock Option Incentive Plan shall be valid for a term of no
longer than 10 years from the date of approval of the Stock Option Incentive Plan by our Board
to the date of completion of the exercise of the options or cancellation of the options under the
Stock Option Incentive Plan.
(vi) Exercise of the options
Options may be exercised by a grantee provided that the annual assessment and
performance targets as set out under the Stock Option Incentive Plan is achieved.
The exercise price for the option to be granted under the PRC Stock Options and the
Foreign and Hong Kong Stock Options is RMB0.92 and US$0.14 per H Share, respectively.
The vesting schedule of the options granted are: (i) (in relation to the PRC Stock Options)
vested in tranches of 25% on the date of grant, the first, second and third anniversary of the
date of grant; and (ii) (in relation to the Foreign and Hong Kong Stock Options) vested in
tranches of one-third of the total options on each of January 1 of 2024, 2025 and 2026, in
tranches of one-fourth of the total options on each of January 1 of 2023, 2024, 2025 and 2026
or in tranches of 25% on the date of grant, the first, second and third anniversary of the date
of grant.
Upon vesting of the options, the eligible employees can exercise the options by written
notice to our Company: (i) in relation to the PRC Stock Options, within 5 years; or (ii) in
relation to the Foreign and Hong Kong Stock Options, within 5 or 7 years from the date of
vesting of the options.
(vii) Outstanding options
(i) The number of H Shares underlying the outstanding options granted under the PRC
Stock Options amounted to 2,283,803 H Shares immediately following the completion of the
Listing and Share Split. Such H Shares are held by the general partner of Wuhan Hanx on
behalf of the grantees; and (ii) the number of H Shares underlying the outstanding option
granted under the Foreign and Hong Kong Stock Options amounted to 13,345,230 H Shares
immediately following the completion of the Listing (assuming no changes to our issued and
outstanding shares between the Latest Practicable Date and the Listing Date).
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-11 –


--- page 686 ---
The table below sets forth the details of the Shares granted to connected persons who are
the Directors, Supervisors or senior management of our Company under the Stock Option
Incentive Plan which were outstanding as of the Listing Date:
Name
of the
grantee
Position in the
Company Address
Date of
grant
Number of
underlying
H Shares under
options granted
Exercise
price per
H Share Option period Vesting schedule
H Shares
underlying
outstanding
options as a
percentage of
issued Shares
immediately
after
the Listing
(1)
The PRC Stock Option (2)
Mr. Liu /H1118Chief operating
officer, vice
general
manager, and
executive
Director
Unit 4-1-504,
Lidao 2046,
Xiongchu
Avenue
Hongshan
District,
Wuhan, Hubei,
PRC
August 29,
2024
2,186,280 RMB0.92 5 years from the
date of vesting
of options
25% on each of:
(i) the date of
grant; (ii) 12
months from the
date of grant;
(iii) 24 months
from the date of
grant; and (iv)
36 months from
the date of grant
1.61%
Ms.
Sun /H1118
Supervisor Unit 1002, No.
138, Lane
1688,
Landian Road,
Zhoupu Town,
Pudong
New Area,
Shanghai, PRC
August 29,
2024
210,530 RMB0.92 5 years from the
date of vesting
of options
25% on each of:
(i) the date of
grant; (ii) 12
months from the
date of grant;
(iii) 24 months
from the date of
grant; and (iv)
36 months from
the date of grant
0.16%
Dr. Ke /H1118Supervisor, and
Chairman of
Supervisory
Committee
Unit 202 Building
3 Block 3, No.
21 Zhongnan
Road, Wuchang
District,
Wuhan, Hubei,
PRC
August 29,
2024
169,440 RMB0.92 5 years from the
date of vesting
of options
25% on each of:
(i) the date of
grant; (ii) 12
months from the
date of grant;
(iii) 24 months
from the date of
grant; and (iv)
36 months from
the date of grant
0.12%
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-12 –


--- page 687 ---
Name
of the
grantee
Position in the
Company Address
Date of
grant
Number of
underlying
H Shares under
options granted
Exercise
price per
H Share Option period Vesting schedule
H Shares
underlying
outstanding
options as a
percentage of
issued Shares
immediately
after
the Listing
(1)
Ms.
Chen
Employee
representative
Supervisor
Unit 307,
Building E9,
Talent
Apartment,
Guanggu 3rd
Road,
Hongshan
District,
Wuhan, Hubei,
PRC
August 29,
2024
13,120 RMB0.92 5 years from the
date of vesting
of options
25% on each of:
(i) the date of
grant; (ii) 12
months from the
date of grant;
(iii) 24 months
from the date of
grant; and (iv)
36 months from
the date of grant
0.01%
The Foreign and Hong Kong Stock Option
(3)
Dr.
Zhang
Chairman and
executive
Director
Unit 601 Unit 1,
Block 42,
Hengda Huafu,
No. 22 Luoyu
East Road,
Wuhan East
Lake New
Technology
Development
Area, Wuhan,
Hubei, PRC
August 28,
2024
(4)
4,675,960 US$0.14 7 years from the
date of vesting
of options
25% on each of :
(i) January 1,
2023; (ii)
January 1, 2024;
(iii) January 1,
2025; and (iv)
January 1, 2026
3.43%
Dr. Li Chief executive
officer, chief
scientific
officer and
executive
Director
3561 V oyager Ct.,
Oceanside,
California,
USA
August 28,
2024
(4)
4,099,275 US$0.14 7 years from the
date of vesting
of options
One-third on each
of: (i) January 1,
2024; (ii)
January 1, 2025;
and (iii) January
1, 2026
3.01%
Ms.
Zhang
Chief medical
officer
9 Hadley Court
Basking Ridge,
New Jersey,
USA
August 28,
2024
(4)
3,279,420 US$0.14 7 years from the
date of vesting
of options
One-third on each
of: (i) January 1,
2024; (ii)
January 1, 2025;
and (iii) January
1, 2026
2.41%
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-13 –


--- page 688 ---
Notes:
(1) The calculation is based on the assumption that no new Shares are issued under the Over-Allotment Option and
our Share Schemes.
(2) Pursuant to the PRC Stock Options, the grantees will be granted with units in Wuhan Hanx. The number of
H Shares for grantees of the PRC Stock Options represent the portion of the units to be held by the grantees
in Wuhan Hanx.
(3) Pursuant to the Foreign and Hong Kong Stock Options, the grantees will be granted with HanxBio (BVI)
shares. The number of H Shares for grantees of the Foreign and Hong Kong Stock Options represent the
portion of the HanxBio (BVI) shares to be held by the grantees.
(4) As confirmed by our Company, the options granted to Dr. Zhang, Dr. Li and Ms. Zhang under the Stock Option
Incentive Plan are replacement of the options to subscribe for equity interests in Hangzhou Hanx granted to
Dr. Zhang, Dr. Li and Ms. Zhang on January 1, 2022. For further details, please refer to note 27 to the
Accountants Report included in Appendix I to this prospectus.
The table below sets forth the details of Shares granted to other grantees (excluding the
abovementioned connected persons of our Company) under the Stock Option Incentive Plan
which were outstanding upon Listing:
Name of the
grantee
Position in the
Company Address Date of grant
Number of
underlying
H Shares under
options granted
Exercise
price per
Share Option period Vesting schedule
H Shares
underlying
outstanding
options as a
percentage of
issued Shares
immediately
after the
Listing (1)
The PRC Stock Option (2)
Mr. Y ang Tao
(เᏹ) /H1118/H1118/H1118
Non-clinical
Senior Director
of the Research
and
Development
Department
Room 405,
Building 18,
Qiupingyuan,
Century Court,
No. 12
Dongcang
South Road,
Taicang,
Jiangsu
August 29,
2024
131,180 RMB0.92 5 years from
the vesting of
the options
25% on each of: (i)
the date of grant;
(ii) 12 months
from the date of
grant; (iii) 24
months from the
date of grant; and
(iv) 36 months
from the date of
grant
0.10%
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-14 –


--- page 689 ---
Name of the
grantee
Position in the
Company Address Date of grant
Number of
underlying
H Shares under
options granted
Exercise
price per
Share Option period Vesting schedule
H Shares
underlying
outstanding
options as a
percentage of
issued Shares
immediately
after the
Listing (1)
Mr. Peng Feiyu
(ρ) /H1118/H1118
CMC Director of
the Research
and
Development
Department
Room 304,
Building 2,
Chengtousixinzhiguang
Guanting,
Laoguan
Community,
Jiangdi Street,
Hanyang
District,
Wuhan, Hubei
August 29,
2024
81,990 RMB0.92 5 years from
the vesting of
the options
25% on each of: (i)
the date of grant;
(ii) 12 months
from the date of
grant; (iii) 24
months from the
date of grant; and
(iv) 36 months
from the date of
grant
0.06%
Mr. Wang
Shuai
(܏)H1118/H1118/H1118
Clinical
Operation
Senior Director
Room 1001, No.
1, Lane 593,
Chuangxin
Middle Road,
Pudong New
Area, Shanghai
August 29,
2024
76,520 RMB0.92 5 years from
the vesting of
the options
25% on each of: (i)
the date of grant;
(ii) 12 months
from the date of
grant; (iii) 24
months from the
date of grant; and
(iv) 36 months
from the date of
grant
0.06%
Ms. Lei Juan
(ࢇ)H1118/H1118/H1118
Director of
Pharmaceutical
Regulations/
Project Quality
Management
Room 303, Unit
1, Building 22,
No. 1,
Xiangzhang
3rd Road,
Changqing
Garden Street,
Dongxihu
District,
Wuhan, Hubei
August 29,
2024
71,050 RMB0.92 5 years from
the vesting of
the options
25% on each of: (i)
the date of grant;
(ii) 12 months
from the date of
grant; (iii) 24
months from the
date of grant; and
(iv) 36 months
from the date of
grant
0.05%
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-15 –


--- page 690 ---
Name of the
grantee
Position in the
Company Address Date of grant
Number of
underlying
H Shares under
options granted
Exercise
price per
Share Option period Vesting schedule
H Shares
underlying
outstanding
options as a
percentage of
issued Shares
immediately
after the
Listing (1)
Ms. Li Jialin
(ҽԳᎌ) /H1118/H1118
Scientist Room 806,
Building 3,
Residential
Property,
Hankou
Branch, Central
Military
Region General
Hospital, No.
68 Huangpu
Road, Jiangan
District, Wuhan
August 29,
2024
12,020 RMB0.92 5 years from
the vesting of
the options
25% on each of: (i)
the date of grant;
(ii) 12 months
from the date of
grant; (iii) 24
months from the
date of grant; and
(iv) 36 months
from the date of
grant
0.01%
Ms. Chen Cen
(௓Ҋ) /H1118/H1118/H1118
Scientist 14-1-1602, Dahua
Platinum
Ruifu, No. 15
Y uanlin Road,
Qingshan
District,
Wuhan, Hubei
August 29,
2024
8,750 RMB0.92 5 years from
the vesting of
the options
25% on each of: (i)
the date of grant;
(ii) 12 months
from the date of
grant; (iii) 24
months from the
date of grant; and
(iv) 36 months
from the date of
grant
0.01%
Mr. Zhong Ren
(ᒤʠ) /H1118/H1118/H1118
Senior IT
manager
Room 220,
Building K6,
Guanggu
Biocity,
Wuhan, Hubei
August 29,
2024
8,750 RMB0.92 5 years from
the vesting of
the options
25% on each of: (i)
the date of grant;
(ii) 12 months
from the date of
grant; (iii) 24
months from the
date of grant; and
(iv) 36 months
from the date of
grant
0.01%
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-16 –


--- page 691 ---
Name of the
grantee
Position in the
Company Address Date of grant
Number of
underlying
H Shares under
options granted
Exercise
price per
Share Option period Vesting schedule
H Shares
underlying
outstanding
options as a
percentage of
issued Shares
immediately
after the
Listing (1)
Mr. Xu Jianling
(஢਄୥) /H1118/H1118
Financial
Manager
Room 701, Unit
1, Building 1,
Phase III of
Guoxin New
City, Guocikou,
Qintai Avenue,
Hanyang
District,
Wuhan, Hubei,
China
August 29,
2024
8,750 RMB0.92 5 years from
the vesting of
the options
25% on each of: (i)
the date of grant;
(ii) 12 months
from the date of
grant; (iii) 24
months from the
date of grant; and
(iv) 36 months
from the date of
grant
0.01%
Ms. Ren Liping
(΂஁റ) /H1118/H1118
Financial
Manager
Room 1703, Unit
2, Building 7,
No. 143
Xudong Street,
Hongshan
District, Wuhan
August 29,
2024
7,650 RMB0.92 5 years from
the vesting of
the options
25% on each of: (i)
the date of grant;
(ii) 12 months
from the date of
grant; (iii) 24
months from the
date of grant; and
(iv) 36 months
from the date of
grant
0.01%
Ms. Y u Ting
(Яణ) /H1118/H1118/H1118
Deputy Medical
Manager
Room 314,
Building K2,
Guanggu
Biocity, No.
666, Gaoxin
Avenue,
Hongshan
District,
Wuhan, Hubei
August 29,
2024
7,650 RMB0.92 5 years from
the vesting of
the options
25% on each of: (i)
the date of grant;
(ii) 12 months
from the date of
grant; (iii) 24
months from the
date of grant; and
(iv) 36 months
from the date of
grant
0.01%
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-17 –


--- page 692 ---
Name of the
grantee
Position in the
Company Address Date of grant
Number of
underlying
H Shares under
options granted
Exercise
price per
Share Option period Vesting schedule
H Shares
underlying
outstanding
options as a
percentage of
issued Shares
immediately
after the
Listing (1)
Mr. Tian Chen
(͞ೠ) /H1118/H1118/H1118
Project Manager 24L, Building
Wanguocheng,
Wuhan City,
Hubei Province
August 29,
2024
6,560 RMB0.92 5 years from
the vesting of
the options
25% on each of: (i)
the date of grant;
(ii) 12 months
from the date of
grant; (iii) 24
months from the
date of grant; and
(iv) 36 months
from the date of
grant
0.005%
Ms. Liao
Hongxiu
(Ӹ) /H1118/H1118
Purchasing
Manager
Room 1604, Unit
1, Building 17,
Qingjianghongjing,
Wenhua
Avenue,
Jiangxia
District, Wuhan
City, Hubei
August 29,
2024
6,560 RMB0.92 5 years from
the vesting of
the options
25% on each of: (i)
the date of grant;
(ii) 12 months
from the date of
grant; (iii) 24
months from the
date of grant; and
(iv) 36 months
from the date of
grant
0.005%
Mr. Mo
Y unlong
(୽ⱃඤ) /H1118/H1118
Senior Medical
Manager
3-204, Lane 388,
Zhoudongnan
Road, Pudong
New Area,
Shanghai
August 29,
2024
5,470 RMB0.92 5 years from
the vesting of
the options
25% on each of: (i)
the date of grant;
(ii) 12 months
from the date of
grant; (iii) 24
months from the
date of grant; and
(iv) 36 months
from the date of
grant
0.004%
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-18 –


--- page 693 ---
Name of the
grantee
Position in the
Company Address Date of grant
Number of
underlying
H Shares under
options granted
Exercise
price per
Share Option period Vesting schedule
H Shares
underlying
outstanding
options as a
percentage of
issued Shares
immediately
after the
Listing (1)
Ms. Liu Chang
(ᄎ࿫) /H1118/H1118/H1118
Senior Manager 4-3-1103, Phase
II, Dahua
South Lake
Park, No. 108
Wenxin Street,
Hongshan
District, Wuhan
City, Hubei
August 29,
2024
5,470 RMB0.92 5 years from
the vesting of
the options
25% on each of: (i)
the date of grant;
(ii) 12 months
from the date of
grant; (iii) 24
months from the
date of grant; and
(iv) 36 months
from the date of
grant
0.004%
Ms. Liu Shuang
(ᄎଗ) /H1118/H1118/H1118
Senior Project
Manager
Room 204, No.
42, Lane 791,
Xiangyin Road,
Y angpu
District,
Shanghai
August 29,
2024
5,470 RMB0.92 5 years from
the vesting of
the options
25% on each of: (i)
the date of grant;
(ii) 12 months
from the date of
grant; (iii) 24
months from the
date of grant; and
(iv) 36 months
from the date of
grant
0.004%
Ms. Ma Junjiao
(۷ڲ)H1118/H1118
Senior Clinical
Quality
Manager
Room 1304, Unit
1, Building 8,
Gaoloujindi,
Liyuan Town,
Tongzhou
District,
Beijing
August 29,
2024
5,470 RMB0.92 5 years from
the vesting of
the options
25% on each of: (i)
the date of grant;
(ii) 12 months
from the date of
grant; (iii) 24
months from the
date of grant; and
(iv) 36 months
from the date of
grant
0.004%
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-19 –


--- page 694 ---
Name of the
grantee
Position in the
Company Address Date of grant
Number of
underlying
H Shares under
options granted
Exercise
price per
Share Option period Vesting schedule
H Shares
underlying
outstanding
options as a
percentage of
issued Shares
immediately
after the
Listing (1)
Ms. Ha
Shaohong
(ߎ)H1118/H1118
Project Manager Room 501,
Building 117,
Lane 1107,
Phase III,
Y ulan
Xiangyuan,
Zhangjiang
Town, Pudong
New Area,
Shanghai
August 29,
2024
4,370 RMB0.92 5 years from
the vesting of
the options
25% on each of: (i)
the date of grant;
(ii) 12 months
from the date of
grant; (iii) 24
months from the
date of grant; and
(iv) 36 months
from the date of
grant
0.003%
Ms. Zhang
Meng ( ੵ഼) /H1118
Data Manager Room 905, Unit
1, Building 15,
Nangaoying
Area 2,
Chang’an
District,
Shijiazhuang
City, Hebei
August 29,
2024
4,370 RMB0.92 5 years from
the vesting of
the options
25% on each of: (i)
the date of grant;
(ii) 12 months
from the date of
grant; (iii) 24
months from the
date of grant; and
(iv) 36 months
from the date of
grant
0.003%
Ms. Gao
Xinbao (ؚ
ᘒ)/H1118/H1118/H1118/H1118/H1118
Medical Manager Room 2702, Unit
2, Jinhua
Xinduhui, No.
38 Changle
Middle Road,
Xincheng
District, Xi’an
City, Shaanxi
August 29,
2024
4,370 RMB0.92 5 years from
the vesting of
the options
25% on each of: (i)
the date of grant;
(ii) 12 months
from the date of
grant; (iii) 24
months from the
date of grant; and
(iv) 36 months
from the date of
grant
0.003%
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-20 –


--- page 695 ---
Name of the
grantee
Position in the
Company Address Date of grant
Number of
underlying
H Shares under
options granted
Exercise
price per
Share Option period Vesting schedule
H Shares
underlying
outstanding
options as a
percentage of
issued Shares
immediately
after the
Listing (1)
Mr. Y an
Liangbo
(ت)H1118/H1118
Deputy Manager
of
Pharmaceutical
Regulations/Project
Quality
Management
Room 603, Unit
1, Building 8,
Phase 1,
Taohuayuan
Community,
Optics V alley
7th Road,
Donghu New
Technology
Development
Zone, Wuhan
City, Hubei
August 29,
2024
3,280 RMB0.92 5 years from
the vesting of
the options
25% on each of: (i)
the date of grant;
(ii) 12 months
from the date of
grant; (iii) 24
months from the
date of grant; and
(iv) 36 months
from the date of
grant
0.002%
The Foreign and Hong Kong Stock Option
(3)
Mr. Zhang Hui /H1118Chief financial
officer, joint
company
secretary of
our Company,
the secretary of
our Board, and
vice general
manager
Unit 2704 E8
Building,
Talent
Apartment,
Optics V alley
Biotech City,
Hongshan
District,
Wuhan, Hubei,
PRC
August 28,
2024
3,279,420 US$0.14 5 years from the
vesting of the
options
25% on each of: (i)
the date of grant;
(ii) 12 months
from the date of
grant; (iii) 24
months from the
date of grant; and
(iv) 36 months
from the date of
grant
2.41%
Notes:
(1) The calculation is based on the assumption that no new Shares are issued under the over-allotment Option and
our Share Schemes.
(2) Pursuant to the PRC Stock Options, the grantees will be granted with units in Wuhan Hanx. The number of
H Shares for grantees of the PRC Stock Options represent the portion of the units to be held by the grantees
in Wuhan Hanx.
(3) Pursuant to the Foreign and Hong Kong Stock Options, the grantees will be granted with HanxBio (BVI)
shares. The number of H Shares for grantees of the Foreign and Hong Kong Stock Options represent the
portion of the HanxBio (BVI) shares to be held by the grantees.
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-21 –


--- page 696 ---
B. Restricted Share Incentive Scheme
(i) Purpose
The purpose of the Restricted Share Incentive Scheme is to improve our Group’s
corporate governance structure and incentive mechanism, ascertain the contribution made by
our employees to our Group, incentivize our Group’s management and key employees to
enhance the competitiveness of our Group to ensure realization of our Group’s future
development strategy and business targets. The Restricted Share Incentive Scheme is
implemented to align the interests of the Shareholders with the interests of our Group and
employee which will benefit the sustained development of our Group.
(ii) Administration
The Restricted Share Incentive Scheme is subject to the approval of the Shareholders’
meeting, administration of the Board and the supervision of the board of Supervisors.
(iii) Participants
The participants of the Restricted Share Incentive Scheme include key personnel of our
Group, namely Dr. Li and Ms. Zhang.
(ix) Maximum number of options and shares
The Restricted Share Incentive Scheme consists of approximately 17 HanxBio (BVI)
shares (the “ Restricted HanxBio (BVI) Shares ”) to be granted to the eligible employees,
representing 2,459,565 H Shares upon Listing. As of the Latest Practicable Date, all the
Restricted HanxBio (BVI) Shares have been granted and vested in the eligible employee.
(x) Date of grant and duration
The date on which the Restricted HanxBio (BVI) Shares are granted shall be the date of
grant agreement entered into between our Group and the eligible employees. As of the Latest
Practicable Date, all the Restricted HanxBio (BVI) Shares have been granted. The Restricted
Share Incentive Scheme shall be valid for a term of no longer than 10 years from the date of
approval of the Stock Option Incentive Plan by our Board to the date of vesting of the
Restricted HanxBio (BVI) Shares under the Restricted Share Incentive Scheme. As of the
Latest Practicable Date, all of the Restricted HanxBio (BVI) Shares have been vested and the
Restricted Share Incentive Scheme has already ended.
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-22 –


--- page 697 ---
(xi) Unlocking and vesting of restricted Shares
As of the Latest Practicable Date, all the Restricted HanxBio (BVI) Shares have been
unlocked and vested to the employees. The following table sets forth the number of Shares
granted to Directors, senior management or connected persons of our Company under the
Restricted Share Incentive Scheme as of the Latest Practicable Date:
Name of the
grantee
Position in the
Company Address
Number of
underlying
H Shares
represented by
the Restricted
HanxBio (BVI)
Shares
Grant
price per
H Share
Approximate
percentage of
issued Shares
represented by the
Restricted HanxBio
(BVI) Shares
immediately after
completion of the
Listing (assuming
the Over-allotment
option is not
exercised)
Dr. Li /H1118/H1118/H1118/H1118/H1118/H1118Chief executive
officer, chief
scientific officer,
general manager,
and executive
Director
3561 V oyager Ct.,
Oceanside,
California, USA
1,366,425 US$0.14 1.00%
Ms. Zhang /H1118/H1118/H1118/H1118Chief medical officer,
and vice general
manager
9 Hadley Court
Basking Ridge,
New Jersey, USA
1,093,140 US$0.14 0.80%
Note: As confirmed by our Company, the Restricted HanxBio (BVI) Shares granted to Dr. Li and Ms. Zhang under
the Restricted Share Incentive Scheme are replacement of the restricted equity interests in Hangzhou Hanx
granted to Dr. Li and Ms. Zhang on January 1, 2022. For further details, please refer to note 27 to the
Accountants Report included in Appendix I to this prospectus.
E. OTHER INFORMATION
1. Estate duty
Our Directors have been advised that currently no material liability for estate duty is
likely to fall on our Company or any of our subsidiaries in the PRC.
2. Litigation
During the Track Record Period and up to the Latest Practicable Date, we had not been
involved in any litigation, arbitration or administrative proceedings which could have a
material adverse impact on our business, financial condition or results of operations. As of the
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-23 –


--- page 698 ---
Latest Practicable Date, we were not aware of any pending or threatened litigation, arbitration
or administrative proceedings against us which may have a material and adverse impact on our
business, financial condition or results of operations.
3. Sole Sponsor
The Sole Sponsor satisfies the independence criteria applicable to sponsors as set out in
Rule 3A.07 of the Listing Rules. The Sole Sponsor’s fee for acting as the sponsor for the
Listing is US$600,000.
The Sole Sponsor has made an application on behalf of our Company to the Stock
Exchange for the Listing of, and permission to deal in, the H Shares to be converted from
Unlisted Shares and the H Shares to be issued pursuant to the Global Offering.
4. Preliminary expenses
As of the Latest Practicable Date, our Company has not incurred any material preliminary
expenses.
5. Promoters
The promoters of our Company are as follows:
No. Name of promoters of our Company
1./H1118/H1118/H1118CZ Biotechnology
2./H1118/H1118/H1118Hanx Biopharmaceuticals (HK)
3./H1118/H1118/H1118Hangzhou Hongye Ruiji
4./H1118/H1118/H1118Wuhan Hanx
5./H1118/H1118/H1118Beijing Lapam
6./H1118/H1118/H1118Betta Pharmaceuticals
7./H1118/H1118/H1118Wuhan Donggaorensi
8./H1118/H1118/H1118Hangzhou Taikun
9./H1118/H1118/H1118Tibet Lapam
10. /H1118Hainan Y angtze
11. /H1118Y angtze Hong Kong
12. /H1118/H1118Lapam Capital
13. /H1118/H1118Ms. Xiao
Save as disclosed in the section headed “History, Development and Corporate Structure”
in this prospectus, within the two years immediately preceding the date of this prospectus, 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 named above in connection with the Listing and the related
transactions described in this prospectus.
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-24 –


--- page 699 ---
6. Qualifications and consents of experts
The following are the qualifications of the experts who have given opinions or advice
which are contained in this prospectus:
Name Qualifications
ICBC International Capital
Limited /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
A licensed corporation to conduct Type 1 (dealing in
securities), Type 4 (advising on securities) and Type
6 (advising on corporate finance) regulated activities
as defined under the SFO
Jingtian & Gongcheng /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Legal advisors to our Company as to the PRC law
Ernst & Y oung /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Certified Public Accountants
Public Interest Entity Auditor registered in
accordance with the Accounting and Financial
Reporting Council Ordinance
Frost & Sullivan (Beijing) Inc.,
Shanghai Branch Co. /H1118/H1118/H1118/H1118/H1118/H1118/H1118
Industry consultant
Each of the experts named above has given and has not withdrawn its respective written
consent to the issue of this prospectus with the inclusion of its reports, letters, opinions,
summaries of opinions and/or references to its name included herein in the form and context
in which they respectively appear.
7. Interests of experts in our Company
Except as disclosed in this prospectus and save for its obligations under the Global
Offering, none of the persons named in the paragraph headed “E. Other Information —
6. Qualifications and consents of experts” in this section above is interested beneficially or
otherwise in any Shares or shares of any member of our Group or has any right or option
(whether legally enforceable or not) to subscribe for or nominate persons to subscribe for any
shares or securities in any member of our Group.
8. Taxation of holders of H Shares
The sale, purchase and transfer of H Shares are subject to Hong Kong stamp duty. The
current rate chargeable on each of the seller and purchaser is 0.1% of the consideration or, if
higher, the fair value of the H Shares being listed or transferred. For further information in
relation to taxation, see the paragraph headed “Taxation and Foreign Exchange” in Appendix
III to this prospectus.
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-25 –


--- page 700 ---
9. Binding effect
This prospectus shall have the effect, if an application is made in pursuance of this
prospectus, 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. Miscellaneous
(a) within the two years immediately preceding the date of this prospectus:
(i) save as disclosed in the section headed “History, Development and Corporate
Structure” in this prospectus, no share or loan capital of our Company or any
of our subsidiaries had been issued or agreed to be issued or proposed to be
fully or partly paid either for cash or for a consideration other than cash;
(ii) save as disclosed in the section headed “History, Development and Corporate
Structure” in this prospectus, 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) save as disclosed in the section headed “Underwriting” in this prospectus, 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
(iv) save as disclosed in the section headed “Underwriting” in this prospectus, no
commission has been paid or is payable for subscription, agreeing to subscribe,
procuring subscription or agreeing to procure subscription of any share in our
Company or any of our subsidiaries;
(b) there are no founder, management or deferred shares nor any debentures in our
Company or any of our subsidiaries;
(c) 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 prospectus;
(d) there has been no material adverse change in the financial or trading position or
prospects of our Group since August 31, 2025 (being the date to which the latest
audited consolidated financial statements of our Group were prepared);
(e) no company within our Group is presently listed on any stock exchange or traded on
any trading system;
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-26 –


--- page 701 ---
(f) all necessary arrangements have been made to enable our H Shares to be admitted
into CCASS for clearing and settlement;
(g) our Company has no outstanding convertible debt securities or debentures;
(h) there is no arrangement under which future dividends are waived or agreed to be
waived; and
(i) none of the equity and debt securities of our Company, if any, is listed or traded in
any other stock exchange nor is any listing or permission to list being or proposed
to be sought.
11. Bilingual prospectus
The English and Chinese language versions of this prospectus 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). In case of any discrepancies between the English language version and
Chinese language version of this prospectus, the English language version shall prevail.
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-27 –


--- page 702 ---
A. DOCUMENTS DELIVERED TO THE REGISTRAR OF COMPANIES IN HONG
KONG
The documents attached to the copy of this prospectus delivered to the Registrar of
Companies in Hong Kong for registration were:
(a) the written consents referred to in the paragraph headed “Statutory and General
Information — E. Other Information — 6. Qualifications and consents of experts”
in Appendix VI to this prospectus; and
(b) a copy of each of the material contracts referred to in the paragraph headed
“Statutory and General Information — B. Further Information about our Business —
1. Summary of material contracts” in Appendix VI to this prospectus.
B. DOCUMENTS ON DISPLAY
Copies of the following documents will be published on the websites of the Stock
Exchange ( www.hkexnews.hk ) and our Company ( http://www.hanxbio.com )u pt oa n d
including the date which is 14 days from the date of this prospectus:
(a) the Articles of Association;
(b) the Accountants’ Report from Ernst & Y oung, the text of which is set out in
Appendix I to this prospectus;
(c) the report from Ernst & Y oung in respect of the unaudited pro forma financial
information, the text of which is set out in Appendix II to this prospectus;
(d) the audited consolidated financial statements of our Group for the two years ended
December 31, 2024 and the eight months ended August 31, 2025;
(e) the material contracts referred to in the paragraph headed “Statutory and General
Information — B. Further Information about our Business — 1. Summary of
material contracts” in Appendix VI to this prospectus;
(f) the service agreements and letters of appointment entered into between our
Company and each of our Directors and Supervisors (as applicable) referred to in the
paragraph headed “Statutory and General Information — C. Further Information
about Directors, Supervisors and Substantial Shareholders — 2. Particulars of
Directors’ and Supervisors’ service agreements and letters of appointment” in
Appendix VI to this prospectus;
(g) the rules of the employee share incentive scheme;
APPENDIX VII DOCUMENTS DELIVERED TO THE REGISTRAR OF
COMPANIES IN HONG KONG AND DOCUMENTS ON DISPLAY
– VII-1 –


--- page 703 ---
(h) the legal opinion issued by Jingtian & Gongcheng, our PRC Legal Adviser, in
respect of certain general corporate matters of our Group;
(i) the legal opinion issued by Jingtian & Gongcheng, our PRC IP Legal Adviser, in
respect of certain intellectual properties matters of our Group in the PRC;
(j) the written consents referred to in the paragraph headed “Statutory and General
Information — E. Other Information — 6. Qualifications and consents of experts”
in Appendix VI to this prospectus;
(k) the PRC Company Law;
(l) the PRC Securities Law, the Trial Administrative Measures of Overseas Securities
Offering and Listing by Domestic Companies, together with their unofficial English
translation; and
(m) the industry report issued by F&S.
APPENDIX VII DOCUMENTS DELIVERED TO THE REGISTRAR OF
COMPANIES IN HONG KONG AND DOCUMENTS ON DISPLAY
– VII-2 –


--- page 704 ---
翰思艾泰生物醫藥科技 ( 武漢 ) 股份有限公司
Hanx Biopharmaceuticals (Wuhan) Co., Ltd.
