Financial Performance - The company achieved a revenue of RMB 1,098,329 thousand for the fiscal year ending December 31, 2024, representing a 41% year-over-year growth[5]. - Product sales revenue reached RMB 877,410 thousand, a 39% increase, primarily driven by steady growth in the core product, Puxinting® (Bevacizumab Injection)[5]. - CDMO/CMO business revenue was RMB 207,133 thousand, reflecting a 47% year-over-year growth, indicating strong operational cash flow with RMB 116,403 thousand net cash from operating activities for 2024[5]. - The company turned a profit for the first time, achieving a net profit of RMB 34,757 thousand for the fiscal year[5]. - The total comprehensive income for 2024 was RMB 36,956,000, compared to a total comprehensive loss of RMB 36,020,000 in 2023[18]. - The company reported a net profit attributable to equity holders of RMB 36,956 thousand for the year ended December 31, 2024, compared to a loss of RMB 36,020 thousand in 2023, indicating a significant turnaround in performance[19]. - Basic and diluted earnings per share for the year were RMB 0.06, compared to a loss of RMB 0.05 per share in the previous year[19]. - The net profit for 2024 was RMB 34,757 thousand, a turnaround from a net loss of RMB 37,757 thousand in 2023[70]. Project Development and Innovation - A total of 58 new projects were added during the year, including 48 ADC projects, bringing the cumulative total to 153 projects[6]. - The company secured 2 pre-BLA projects during the year, with a total of 8 projects in hand, showcasing its strong commercialization capabilities[6]. - The newly launched BDKcellTM technology platform has achieved a maximum expression level of 12g/L, significantly enhancing the efficiency of the overall process[12]. - The ADC project revenue and quantity have steadily increased, contributing to the company's ongoing stable development[12]. - The company has successfully completed multiple ADC projects for clients, ensuring timely delivery and receiving high recognition from customers[104]. - The company has established a leading domestic production line for biopharmaceutical commercialization, with antibody production capacity exceeding 10,000 liters, ensuring continuous supply of commercialized products[84]. - The company has provided over 100 projects in antibody, protein, ADC, and XDC development services, meeting registration requirements in China, the US, and the EU[84]. Financial Position and Assets - Total assets increased to RMB 1,508,772 thousand in 2024, up from RMB 1,426,101 thousand in 2023, reflecting a growth of approximately 5.8%[21]. - Total liabilities rose to RMB 779,117 thousand in 2024, compared to RMB 739,415 thousand in 2023, representing an increase of about 5.4%[23]. - The company's cash and cash equivalents increased to RMB 381,256 thousand in 2024 from RMB 351,600 thousand in 2023, showing a growth of approximately 8.4%[21]. - Trade and other receivables increased significantly to RMB 157,278 thousand in 2024, up from RMB 88,152 thousand in 2023, marking an increase of about 78.4%[21]. - The company’s total equity improved to RMB 729,655 thousand in 2024, compared to RMB 686,686 thousand in 2023, reflecting an increase of approximately 6.3%[21]. - Non-current assets totaled RMB 765,495 thousand in 2024, up from RMB 732,926 thousand in 2023, indicating a growth of about 4.4%[21]. Research and Development - Research and development expenses decreased to RMB 79,313 thousand in 2024 from RMB 103,890 thousand in 2023, indicating a reduction of approximately 23.8%[18]. - The company plans to continue its focus on research and development in anti-tumor drugs and expand its contract development and manufacturing organization (CDMO) services[25]. - The company has invested approximately RMB 180 million in the construction of a global R&D service center, with total expenditures related to this project amounting to RMB 43,489 thousand as of December 31, 2024[75]. - The company has streamlined its R&D pipeline, leading to a continuous reduction in new drug R&D expenses and effectively improving cash flow, achieving a milestone of turning losses into profits[110]. Market and Strategic Initiatives - The company aims to deepen its international market presence and enhance its operational capabilities by collaborating with leading global pharmaceutical companies[15]. - The company is positioned to benefit from favorable policies that support the transfer of overseas production drugs to domestic production, enhancing its opportunities in the global supply chain[82]. - The company aims to enhance its brand presence in the biopharmaceutical CDMO sector through various industry collaborations and exchanges in 2024, focusing on precise customer targeting and resource integration[119]. - The company aims to enhance international competitiveness by accelerating overseas market expansion and strengthening strategic cooperation with leading international pharmaceutical companies[132]. Corporate Governance and Compliance - The company has adopted the principles and provisions of the corporate governance code as a foundation for its corporate governance practices, ensuring high standards to protect shareholder rights[141]. - The company has confirmed compliance with the standard code for securities transactions by directors for the fiscal year ending December 31, 2024[142]. - The company’s financial statements for the fiscal year ending December 31, 2024, have been audited and received an unqualified opinion from the auditor[154]. Events and Recognition - Dongyao Pharmaceutical participated in the inaugural Future XDC New Drug Conference in April 2024, where it was recognized as a "Pioneer Enterprise in ADC/Nucleic Acid New Infrastructure"[120]. - The company showcased its innovative achievements in ADCs at the CBA-China annual meeting in June 2024, reinforcing its strategic positioning in the global biopharmaceutical industry[123]. - Dongyao Pharmaceutical held an ADC & XDC drug development and innovation technology exchange meeting in November 2024, promoting the GL-DisacLink® technology and enhancing collaboration with Sugar Ridge Biotech[125].

Financial Performance - The company achieved a revenue of RMB 520.6 million for the first half of 2024, representing a 59% increase year-on-year[5]. - The net profit for the first half of 2024 was RMB 31.6 million, marking a turnaround from previous losses[5]. - In the first half of 2024, the company's operating revenue reached RMB 520,603 thousand, an increase of RMB 192,540 thousand or 59% compared to RMB 328,063 thousand in the same period of 2023[41]. - The net profit for the first half of 2024 was RMB 31,559 thousand, a turnaround from a net loss of RMB 15,163 thousand in the same period of 2023[41]. - The basic and diluted earnings per share for the first half of 2024 was RMB 0.04, compared to a loss per share of RMB 0.02 in the same period of 2023[49]. - The company reported a net profit attributable to equity holders of RMB 31,559 thousand, a significant turnaround from a loss of RMB 15,163 thousand in the previous year[54]. - Revenue for the six months ended June 30, 2024, reached RMB 520,603 thousand, a 58.6% increase from RMB 328,063 thousand in the same period of 2023[50]. - Operating profit for the period was RMB 33,258 thousand, compared to an operating loss of RMB 14,576 thousand in the prior year[50]. Revenue Breakdown - Product sales revenue reached RMB 400.4 million, a 44% increase, primarily driven by the sales of the core product, Puxintin® (Bevacizumab Injection)[5]. - CDMO/CMO business revenue was RMB 113.8 million, showing a significant growth of 144% compared to the previous year[5]. - CDMO/CMO business revenue for the first half of 2024 was RMB 113,791 thousand, a significant increase of RMB 67,245 thousand or 144% from RMB 46,546 thousand in the same period of 2023[41]. - The company has a backlog of unfulfilled orders amounting to RMB 184 million, which is a 100% increase year-on-year[5]. Product Development and Market Expansion - The company plans to complete its first country approval for overseas market expansion in the second half of 2024, initiating commercial sales[3]. - The company has initiated registration applications for market entry in 31 overseas countries, with 17 applications already accepted, aiming for approval in the first overseas market by the end of 2024[11]. - The company is focusing on a differentiated sales strategy for its core product, which has gained a good market reputation and supports sustainable development[3]. - The company has successfully obtained 2 pre-BLA projects in the first half, totaling 8 in hand, showcasing its strong capabilities in later-stage commercialization[5]. - The company plans to continue focusing on the biopharmaceutical CDMO sector and advance more projects in the second half of 2024[38]. Research and Development - Research and development expenses for the first half of 2024 amounted to RMB 46,059 thousand, a decrease of RMB 3,910 thousand from RMB 49,969 thousand in the same period of 2023[41]. - The company has maintained a focus on research and development in anti-tumor drugs and biopharmaceuticals, indicating ongoing investment in innovation[56]. - The company is exploring new targeted methods in ADC development, indicating potential for significant market opportunities in the future[19]. Market Trends and Projections - The global ADC market is expected to grow from USD 7.9 billion in 2022 to USD 64.7 billion by 2030, with a CAGR of 30.0% from 2022 to 2030[15]. - The ADC drug market reached USD 10 billion in 2023, with five products exceeding USD 1 billion in sales, indicating a significant growth phase for ADC products[19]. - The global market for Bevacizumab is projected to reach nearly RMB 49 billion by 2030, with a CAGR of 7.6% from 2021 to 2030[10]. - The ADC CDMO market is projected to grow to USD 11 billion by 2030, with a CAGR of 28.4% from 2022 to 2030[20]. Operational Efficiency - The company has completed over 60 GMP audits as of June 30, 2024, including zero-defect passes for EU QP audits and successful audits from Colombia, Indonesia, and Egypt[24]. - The company maintains a high production operation efficiency with over 95% staffing rate in production positions and 90% in key ADC technical roles[29]. - The company has established a one-stop, end-to-end antibody and ADC service platform, positioning itself as a leading CDMO service provider in the industry[21]. Financial Position and Liabilities - Total liabilities to total assets ratio remained stable at 0.5 as of June 30, 2024, consistent with the ratio reported on December 31, 2023[43]. - As of June 30, 2024, the company had outstanding bank borrowings of RMB 383,008 thousand, an increase from RMB 344,285 thousand at the end of 2023[43]. - The company's total assets as of June 30, 2024, amounted to RMB 1,456,654 thousand, up from RMB 1,426,101 thousand at the end of 2023, indicating a growth of 2.1%[52]. Shareholder Information and Stock Options - The total number of shares issued by the company is 772,787,887, with major shareholders holding significant stakes, including 28.59% by Shengde Pharmaceutical Co., Ltd. and 15.04% by Suzhou Weiwang Management Consulting Partnership[101][102]. - The company has implemented a pre-IPO share option plan to attract and retain talent, with options granted to key personnel, including 1,000,000 shares to Dr. Liu Jun, which are subject to vesting conditions[107][108]. - The company has granted stock options to senior management and other employees totaling 5,247,100 shares, with various vesting periods[109]. Future Outlook - The company provided an optimistic outlook for the second half of 2024, projecting a revenue growth of 20% to 30% driven by new product launches and market expansion[132]. - The company aims to achieve a net profit margin of 15% by the end of 2024, up from 12% in the first half of the year[132]. - The company plans to expand its market presence in Southeast Asia, targeting a 10% market share by the end of 2025[132].

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Performance and Milestone Highlights [Overall Performance Overview](index=1&type=section&id=Overall%20Performance%20Overview) The Group achieved a net profit of **RMB 31.56 million** in H1 2024, turning losses into profits, with **59%** revenue growth from core product sales and CDMO/CMO business Key Financial and Operational Indicators for H1 2024 | Indicator | H1 2024 (RMB thousands) | YoY Growth | Description | | :--- | :--- | :--- | :--- | | **Operating Revenue** | 520,603 | 59% | - | | Product Sales Revenue | 400,400 | 44% | Primarily from continuous sales growth of core product Puxinting® | | CDMO/CMO Business Revenue | 113,791 | 144% | Significant results from strategic transformation | | **Net Profit** | 31,559 | Turned losses into profits | Last year same period was a loss | | **Net Cash from Operating Activities** | 27,801 | - | Remained positive | - CDMO business market position continues to improve, with **20 new projects** added in H1 (17 of which are ADC projects), bringing the cumulative total to **115 projects**. Two new pre-BLA (pre-Biologics License Application) projects were added, totaling **8**, securing potential for future commercial production[1](index=1&type=chunk) - Signed but uncompleted orders (orders on hand) reached **RMB 184 million**, a year-on-year increase of **104%**, providing assurance for future revenue growth[1](index=1&type=chunk) - To meet rapid business development, the CDMO team personnel increased by **29%** year-on-year to **492** people, accounting for **86%** of the Group's total headcount, with the ADC CDMO team seeing a **27%** year-on-year increase[2](index=2&type=chunk) Consolidated Financial Information [Interim Condensed Consolidated Statement of Comprehensive Income/(Loss)](index=2&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Comprehensive%20Income%2F%28Loss%29) The company turned losses into profits in H1 2024, reporting a net profit of **RMB 31.56 million** with **59%** revenue growth to **RMB 521 million** Key Income Statement Data for H1 2024 | Indicator (RMB thousands) | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :--- | :--- | :--- | | **Revenue** | 520,603 | 328,063 | | Operating Profit/(Loss) | 33,258 | (14,576) | | **Profit/(Loss) for the Period** | 31,559 | (15,163) | | **Total Comprehensive Income/(Loss)** | 33,082 | (11,746) | | **Basic and Diluted Earnings/(Loss) Per Share (RMB)** | 0.04 | (0.02) | [Interim Condensed Consolidated Statement of Financial Position](index=4&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2024, total assets reached **RMB 1.457 billion**, with total equity increasing to **RMB 724 million** and net current assets improving to **RMB 348 million** Key Balance Sheet Item Changes | Indicator (RMB thousands) | June 30, 2024 | December 31, 2023 | | :--- | :--- | :--- | | **Total Assets** | 1,456,654 | 1,426,101 | | **Total Liabilities** | 732,767 | 739,415 | | **Total Equity** | 723,887 | 686,686 | | Current Assets | 720,320 | 693,175 | | Current Liabilities | 372,033 | 382,486 | | **Net Current Assets** | 348,287 | 310,689 | Notes to Financial Information [Segment and Revenue Information](index=6&type=section&id=Segment%20and%20Revenue%20Information) The Group's H1 2024 revenue grew by **44%** in goods sales and **144%** in CDMO/CMO, with all revenue and non-current assets from mainland China Revenue Breakdown for H1 2024 | Revenue Category (RMB thousands) | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :--- | :--- | :--- | | Sales of Goods | 400,400 | 277,881 | | CDMO | 109,264 | 26,054 | | CMO | 4,527 | 20,492 | | **Total** | **520,603** | **328,063** | - All of the Group's revenue and non-current assets are derived from the mainland China market[15](index=15&type=chunk) [Borrowings](index=13&type=section&id=Borrowings) As of June 30, 2024, total borrowings increased to **RMB 383 million**, primarily non-current, with a stable weighted average effective interest rate of **3.81%** Borrowings Structure | Borrowing Category (RMB thousands) | June 30, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Current (within one year) | 68,090 | 41,600 | | Non-current (over one year) | 314,918 | 302,685 | | **Total** | **383,008** | **344,285** | Management Discussion and Analysis [Business Review and Outlook](index=16&type=section&id=Business%20Review%20and%20Outlook) The company's strategic shift to CDMO yielded **144%** revenue growth, particularly in ADC, while core product Puxinting® sales rose **44%**, strengthening market position - CDMO business showed strong development, with **20 new projects** added in H1, of which **17 were ADC projects**; cumulative pre-BLA projects on hand reached **8**; signed but uncompleted orders amounted to **RMB 184 million**, a year-on-year increase of **104%**[35](index=35&type=chunk)[36](index=36&type=chunk) - Sales of the core self-developed product Puxinting® (Bevacizumab Injection) increased by **49%** year-on-year in H1 through differentiated marketing, and listing registration applications have been initiated in **31 overseas countries**, with the first overseas country approval expected in H2[34](index=34&type=chunk)[49](index=49&type=chunk) - The company emphasizes its differentiated CDMO competitive advantages, including a "one-site, end-to-end" antibody/ADC industrialization platform, continuously iterated technology platforms, a quality management system compliant with US, EU, and China GMP standards, and flexible and diverse capacity[37](index=37&type=chunk)[39](index=39&type=chunk)[40](index=40&type=chunk)[42](index=42&type=chunk) - Looking ahead, the company will continue to focus on the biopharmaceutical CDMO business, leveraging its drug development experience, technology platforms, and quality system to expand brand influence and consolidate its leading market position[52](index=52&type=chunk) [Financial Item Analysis](index=25&type=section&id=Financial%20Item%20Analysis) In H1 2024, the company achieved **RMB 31.56 million** net profit, turning losses into profits, with total revenue up **59%** to **RMB 521 million**, and positive operating cash flow Key Financial Item Changes for H1 2024 | Item (RMB thousands) | H1 2024 | H1 2023 | Change Description | | :--- | :--- | :--- | :--- | | **Operating Revenue** | 520,603 | 328,063 | Driven by both product sales and CDMO/CMO business | | Product Sales Revenue | 400,400 | 277,881 | Steady growth in sales of core product Puxinting® | | CDMO/CMO Business Revenue | 113,791 | 46,546 | Large-scale development of business segments | | **R&D Expenses** | 46,059 | 49,969 | Optimized product pipeline, focused R&D resources | | **Selling Expenses** | 276,482 | 197,376 | Increased with sales volume and CDMO business expansion | | **Net Profit/(Loss)** | 31,559 | (15,163) | Successfully turned losses into profits | | **Net Cash Inflow from Operating Activities** | 27,801 | 62,413 | Decreased year-on-year but remained positive | Other Information [Corporate Governance and Dividends](index=28&type=section&id=Corporate%20Governance%20and%20Dividends) The Audit Committee reviewed financial statements, and the Board resolved not to declare an interim dividend for H1 2024, adhering to governance codes - The Board of Directors has resolved not to declare an interim dividend for the six months ended June 30, 2024[67](index=67&type=chunk) - The company's Audit and Connected Transactions Review Committee has reviewed the Group's condensed consolidated interim financial statements[66](index=66&type=chunk) [Use of Net Proceeds from Subscription](index=28&type=section&id=Use%20of%20Net%20Proceeds%20from%20Subscription) As of June 30, 2024, **RMB 43.84 million** of 2022 subscription proceeds were used in H1, with **RMB 66.52 million** remaining for disclosed purposes - As of June 30, 2024, approximately **RMB 66.515 million** of the net proceeds from the 2022 subscription remains unused[70](index=70&type=chunk) - During the six-month period ended June 30, 2024, approximately **RMB 43.841 million** of the net proceeds was used[70](index=70&type=chunk)

Financial Performance - The company achieved a revenue of RMB 780,629 thousand, representing a year-on-year growth of 77%[13] - Product sales revenue reached RMB 630,207 thousand, a significant increase of 107% year-on-year, primarily driven by the strong sales performance of the core product, Puxintin (Bevacizumab injection)[13] - CDMO/CMO business revenue was RMB 140,898 thousand, reflecting a year-on-year growth of 94%[13] - The adjusted EBITDA was RMB 40,041 thousand, showing a substantial increase of 274% year-on-year[18] - The net loss narrowed to RMB 37,757 thousand, a reduction of RMB 12,289 thousand or 25% compared to the previous year[18] - The adjusted net loss for the year was RMB 37.76 million, a 25% improvement compared to the previous year, while total comprehensive loss decreased by 18% to RMB 36.02 million[28] - The adjusted net loss for 2023 was RMB 8,162 thousand, a decrease of RMB 25,773 thousand compared to the adjusted net loss of RMB 33,935 thousand in 2022[35] - Total revenue for 2023 reached RMB 780,629 thousand, representing a 77% increase from RMB 442,178 thousand in 2022[36] - Product sales revenue for 2023 was RMB 630,207 thousand, up from RMB 304,361 thousand in 2022, primarily due to a significant increase in sales of the core product, Puxintin®[37] - CDMO/CMO business revenue for 2023 was RMB 140,898 thousand, an increase of RMB 68,360 thousand from RMB 72,538 thousand in 2022, attributed to large-scale expansion of the CDMO/CMO business segment[37] Operational Highlights - The company maintained a positive operating cash flow of RMB 56,431 thousand[18] - The company has established a high-standard commercial production platform integrating antibodies, ADC raw solutions, and formulations[22] - The CDMO business experienced a growth rate exceeding the industry average, with 39 new projects added in 2023, representing a 44% year-over-year increase, totaling 95 projects[23] - Among the new projects, 30 are related to ADC, highlighting the company's differentiated advantage in this field, with ADC projects now accounting for 65% of both revenue and project count among the 65 ongoing projects[23] - The company has accumulated 6 pre-BLA projects, with 4 being newly added, showcasing its strong capabilities in commercializing CDMO projects[23] - The company optimized its production lines, significantly enhancing flexibility and capacity, with annual production capacities of 300,000 liters for antibody raw materials and 20 million doses for formulations[25] - The second ADC formulation production line commenced operations in June 2023, with over 10 projects already produced, including 3 pre-BLA projects[25] - The total number of employees reached 551 as of December 31, 2023, with the CDMO team increasing by 34% compared to the end of 2022, now comprising 84% of the total workforce[24][26] Strategic Initiatives - Strategic collaborations have been formed with multiple companies, including Lepu Biopharma and Shijian Biopharma, to enhance ADC CDMO differentiation advantages[22] - The company initiated the construction of a global R&D service center in 2021, which officially opened on October 19, 2023, covering an area of 25,000 square meters[25] - The company expects to complete its first overseas approval in 2024, which will provide new treatment options for a broader patient population globally[26] - A strategic partnership was formed with Sugar Ridge Bio to develop the DisacLink™ ADC technology platform, enhancing the company's competitive edge in ADC drug development[70] - The company is focused on becoming a leading CDMO partner in the bioconjugate drug sector, enhancing service quality and technical capabilities to build customer loyalty[99] Research and Development - Research and development expenses for 2023 were RMB 103,890 thousand, down from RMB 151,168 thousand in 2022, mainly due to streamlining of product pipelines[38] - The company streamlined its R&D pipeline, leading to a continuous decrease in new drug R&D expenses while actively promoting sales of already launched products to improve cash flow[83] - The commercialization agreement for TAB014, aimed at treating wet age-related macular degeneration (wAMD), was signed with a subsidiary of Zhaoke Ophthalmology, with Phase III clinical trial patient enrollment completed ahead of schedule on September 16, 2023[83] Corporate Governance - The company has adopted the principles and provisions of the corporate governance code as outlined in Appendix C1 of the listing rules[142] - The board is committed to maintaining high ethical standards and ensuring activities are conducted with accountability, transparency, fairness, and responsibility[142] - The company has established its own corporate governance policy, which includes principles and practices from the corporate governance code[142] - The board of directors consists of seven members, including one executive director and three independent non-executive directors, ensuring a balanced skill set and independence[146] - The company has implemented strict written guidelines for employees regarding insider trading, ensuring adherence to ethical standards[144] Management and Leadership - Yin Li joined the company as Chief Technology Officer in November 2023, bringing over 30 years of experience in the chemical and biopharmaceutical industry[127] - Dr. Pan Zhiwei was appointed as Vice President of CMC in March 2023, responsible for process development and project management, with previous experience at Shanghai Junshi Biosciences[128] - Li Hongyang will join the company as Vice President of Quality in January 2024, with extensive experience in quality management from Novartis and other multinational pharmaceutical companies[129] - The management team has a strong background in biopharmaceuticals, with members having held significant positions in leading companies like Amgen and Bayer[127][128] Market Expansion - The company is expanding its market presence in Southeast Asia, targeting a 15% market share by 2025[124] - The company initiated registration applications for market approval in 23 overseas countries, with 13 applications already accepted, aiming for the first overseas approval in 2024[87] Financial Position - The company's cash and cash equivalents decreased to RMB 351,600 thousand in 2023 from RMB 417,769 thousand in 2022, a reduction of RMB 66,169 thousand[60] - Operating cash inflow for 2023 was RMB 56,431 thousand, down from RMB 59,929 thousand in 2022, reflecting a decrease of approximately 5.8%[60] - The company's total liabilities rose to RMB 739,415 thousand in 2023 from RMB 546,592 thousand in 2022, marking an increase of about 35.1%[58] - The current ratio decreased to 1.8 in 2023 from 2.5 in 2022, indicating a decline in liquidity[62] Awards and Recognition - In 2023, the company achieved significant growth in the CDMO business, receiving multiple industry awards and recognition, including being ranked in the top 10 most growth-oriented CDMO companies in China[114]

Investment Rating - The report suggests a positive outlook on the company, indicating it is undervalued and recommends active attention to its growth potential [15]. Core Insights - The company is experiencing rapid growth, particularly in overseas markets, with a strong product quality and a 100% production qualification rate [4]. - The commercial promotion of listed products is progressing smoothly, contributing to significant revenue growth [5]. - The CDMO business is advancing quickly, with a notable competitive advantage in the ADC sector [6]. Summary by Sections Company Growth and Market Potential - The company has a robust presence in both domestic and international markets, covering multiple indications such as colorectal cancer and non-small cell lung cancer, with plans for further expansion [4]. - It has initiated registration applications in 23 overseas countries, with 13 applications already accepted, aiming for approval in the first overseas market by 2024 [4]. Financial Performance - In 2023, the company reported revenues of 781 million RMB, a 77% year-on-year increase, while net losses narrowed by 25% to 37.76 million RMB [8]. - Adjusted EBITDA reached 40.04 million RMB, reflecting a 274% increase, and operating cash flow remained positive for two consecutive years [8]. CDMO Business Development - The CDMO segment generated 140 million RMB in revenue in 2023, a 94% increase year-on-year, with over 137 million RMB in hand orders and 39 new projects, 30 of which are ADC projects [7]. - The workforce in the CDMO division has grown by 34% compared to the end of 2022, with a 46% increase in the ADC CDMO team [7]. - The company has established long-term partnerships for ADC projects, enhancing its service offerings from R&D to commercialization [7].

Financial Performance - The group's total revenue for 2023 was RMB 780,629 thousand, representing a 77% year-on-year increase[1]. - The net loss for 2023 was RMB 37,757 thousand, a reduction of RMB 12,289 thousand or 25% compared to the net loss of RMB 50,046 thousand in 2022[6]. - Adjusted EBITDA for the year was RMB 40,041 thousand, reflecting a substantial increase of 274% year-on-year[14]. - The total comprehensive loss for the year ended December 31, 2023, was RMB 36,020 thousand, an improvement from RMB 43,732 thousand in 2022[21]. - The company reported total revenue of RMB 780,629 thousand for the year ended December 31, 2023, compared to RMB 442,178 thousand in 2022[31]. - The overall comprehensive loss for the year was RMB 36,020 thousand, a decrease from RMB 43,602 thousand in the previous year[44]. - The company's operating revenue for 2023 was RMB 780,629 thousand, an increase of RMB 338,451 thousand or 77% compared to RMB 442,178 thousand in 2022[66]. - The net loss for 2023 was RMB 37,757 thousand, a reduction of RMB 12,289 thousand or 25% from a net loss of RMB 50,046 thousand in 2022[66]. - The group's financial income for 2023 was RMB 2,974 thousand, an increase of RMB 709 thousand from RMB 2,265 thousand in 2022, primarily due to optimized fund allocation[124]. - The group's financial cost for 2023 was RMB 5,175 thousand, a decrease of RMB 1,427 thousand from RMB 6,602 thousand in 2022, mainly due to the repayment of part of the working capital loans[125]. Revenue Sources - Product sales revenue reached RMB 630,207 thousand, a 107% increase year-on-year, primarily driven by significant sales growth of the core product, Puxinting® (Bevacizumab Injection)[1]. - CDMO/CMO business revenue was RMB 140,898 thousand, up 94% year-on-year, with a total of 39 new projects added, a 44% increase compared to the previous year[7]. - The company achieved a stable cash flow contribution from product commercialization, with total sales revenue reaching RMB 630 million[38]. - The company's CDMO/CMO business revenue for 2023 was RMB 140,898 thousand, an increase of RMB 68,360 thousand from RMB 72,538 thousand in 2022, primarily due to large-scale expansion in the CDMO/CMO sector[91]. Research and Development - R&D expenses increased to RMB 103,890 thousand, up from RMB 71,563 thousand in 2022[42]. - Research and development expenses for 2023 amounted to RMB 103,890 thousand, down from RMB 151,168 thousand in 2022[66]. - The company has established a global R&D service center in October 2023, covering an area of 25,000 square meters, to enhance CDMO business capabilities[16]. - The company has formed strategic collaborations to accelerate the development and commercialization of innovative conjugated drugs[33]. Production and Capacity - The company has optimized its production lines, significantly enhancing flexibility and capacity, with annual production capacity of 300,000 liters for antibody raw materials and 20 million doses for formulations[16]. - The second ADC formulation production line commenced operation in June 2023, with over 10 projects, including 3 pre-BLA projects, already produced on this line[16]. - The company has built a large-scale ADC formulation commercial production line with an annual capacity of 5.3 million bottles, significantly improving production flexibility and capacity[33]. - The company has established a large-scale commercial production line for ADC raw materials and formulations, with an annual production capacity of 300,000 liters for antibody raw materials and over 20 million doses for formulations[144]. Strategic Collaborations - The company has formed multiple long-term strategic collaborations with various biopharmaceutical companies, enhancing its ADC CDMO competitive advantage[15]. - The company has partnered with Sugar Ridge Biologics to co-develop the DisacLinkTM ADC glyco-conjugation technology platform, promoting accelerated development in the ADC industry[161]. - The company established a strategic partnership with Shijian Biotech to support the clinical and commercial development of ADC drugs[164]. - A comprehensive CDMO strategic collaboration was formed with Borui Biotech to provide one-stop CDMO services for multiple ADC development projects[165]. Market Outlook - The core product, Puxinting®, has achieved a market size exceeding RMB 10 billion, with a projected global market size for Bevacizumab expected to reach nearly RMB 49 billion by 2030, growing at a CAGR of 7.6% from 2021 to 2030[179]. - The Chinese market for Bevacizumab is anticipated to grow to RMB 18.4 billion by 2030, with a CAGR of 8.3% from 2021 to 2030[179]. Operational Metrics - The CDMO team has increased by 34% compared to the end of 2022, now comprising 464 members, with a core technical team averaging over 12 years of experience in biopharmaceuticals[18]. - The company added 39 new projects in the CDMO business, a year-on-year increase of 44%, bringing the total to 95 projects, with ADC projects accounting for 30 of the new additions[160]. - The company has successfully secured 4 pre-BLA projects, totaling 6 pre-BLA projects, showcasing its strong capabilities in commercializing CDMO projects[160]. Financial Position - Total assets increased to RMB 1,426,101 thousand, up from RMB 1,262,031 thousand in 2022[46]. - The company's net assets as of December 31, 2023, were RMB 686,686 thousand, a decrease of RMB 28,753 thousand from RMB 715,439 thousand at the end of 2022, primarily due to the net loss incurred during the period[118]. - The total liabilities to total assets ratio increased to 0.5 as of December 31, 2023, compared to 0.4 at the end of 2022, primarily due to increased long-term bank loans for the global R&D service center construction[154]. Compliance and Quality - The company has established a quality management system compliant with commercial production standards, supporting the commercialization of two listed products[170]. - The company has successfully completed 7 regulatory inspections by NMPA and other global regulatory bodies, ensuring compliance with high industry standards[170]. - The company is committed to continuously improving its international quality management system to provide high-quality services to clients[170].

Financial Performance - The net loss for the first half of 2023 decreased to RMB 15,163 thousand from RMB 15,724 thousand in the same period of 2022, reflecting effective cost control, particularly in R&D expenses [15]. - The company achieved a revenue of RMB 328,063 thousand in the first half of 2023, representing an 80% year-on-year growth. Excluding one-time licensing income from the previous year, the revenue growth reached 147% [48]. - Sales revenue amounted to RMB 277,881 thousand, a significant increase of 167% year-on-year, primarily driven by the strong sales performance of the core product, Puxinting (Bevacizumab biosimilar) [48]. - Financial revenue for the first half of 2023 was RMB 1,278 thousand, an increase of RMB 863 thousand compared to RMB 415 thousand in the same period of 2022 [115]. - The company reported a total comprehensive loss attributable to equity holders of RMB 11,746 thousand for the period, compared to a loss of RMB 12,488 thousand in the previous period, indicating a slight improvement [168]. - Total revenue for the six months ended June 30, 2023, was RMB 328,063 thousand, a significant increase from RMB 182,019 thousand for the same period in 2022, representing an increase of approximately 80.4% [200]. Research and Development - R&D expenses were significantly reduced to RMB 49,969 thousand, showcasing the company's strategic adjustments [15]. - Research and development expenses decreased to RMB 49,969 thousand in the first half of 2023 from RMB 70,268 thousand in the same period of 2022, suggesting improved cost management [120]. - The company is focusing on optimizing its product pipeline and enhancing R&D resources to drive future growth [134]. - The company has initiated the construction of a global R&D center with a total planned investment of approximately RMB 180 million [117]. CDMO/CMO Business - The number of CDMO projects in hand reached 45, a 96% increase year-on-year, significantly outpacing industry average growth [24]. - The CDMO/CMO business generated revenue of RMB 46,546 thousand, reflecting a 105% year-on-year growth [48]. - In the first half of 2023, the revenue from CDMO/CMO business reached RMB 46,546 thousand, representing a year-on-year growth of 105% [89]. - The company has established a comprehensive "end-to-end" commercialization production line for ADC, with a total capacity of 20,000L for antibodies and intermediates, meeting the majority of domestic ADC drug capacity needs [90]. - The company has successfully implemented two ADC production lines capable of producing freeze-dried products at a speed of 200 bottles per minute [84]. Market and Product Development - The global ADC drug market is projected to grow from USD 7.9 billion in 2022 to USD 64.7 billion by 2030, with a compound annual growth rate (CAGR) of 30% [34]. - The ADC CDMO market reached USD 1.5 billion in 2022, with a CAGR of 34.5% from 2018 to 2022, and is expected to grow to USD 11 billion by 2030 [39]. - The company has established partnerships for ADC drugs and has successfully obtained 3 pre-BLA ADC projects, demonstrating its capabilities in the ADC CDMO field [24]. - The company has partnered with Sugar Ridge Biotech to develop the DisacLink™ ADC glyco-conjugation technology platform, enhancing ADC innovation [48]. - The core product, Bevacizumab Injection (朴欣汀®), has achieved sales growth of 161% year-on-year in the first half of 2023, driven by a differentiated marketing strategy targeting second and third-tier cities [53]. Financial Position and Risks - As of June 30, 2023, the company's net assets were RMB 708,050 thousand, a decrease of RMB 7,389 thousand from RMB 715,439 thousand at the end of 2022 [115]. - The company's cash and cash equivalents as of June 30, 2023, were RMB 432,975 thousand, an increase of RMB 15,206 thousand from RMB 417,769 thousand at the end of 2022 [116]. - The company's total liabilities to total assets ratio increased to 0.5 as of June 30, 2023, compared to 0.4 as of December 31, 2022, primarily due to increased bank borrowings for the global R&D center construction [117]. - The company has identified various financial risks, including market risk, credit risk, and liquidity risk, and is focused on mitigating potential adverse impacts on financial performance [162]. - The company’s overall risk management plan emphasizes the unpredictability of financial markets to safeguard its financial condition and performance [162]. Workforce and Corporate Culture - The workforce consists of 463 employees, with 67% in production, 16% in R&D, 13% in general and administrative roles, and 5% in sales and marketing [140]. - Employee benefits expenses for the first half of 2023 were RMB 80,899 thousand, up from RMB 60,831 thousand in the same period of 2022, reflecting a significant increase in workforce costs [118]. - The company has restructured its corporate culture to promote long-term sustainable development and improve customer satisfaction [109].

Financial Data and Key Metrics Changes - The company's total revenue for the first half of 2023 reached RMB 328 million, representing an 80% year-on-year increase. Excluding the impact of licensing fees from the previous year, the revenue growth was 147% [11][13][17] - Adjusted EBITDA turned positive for the first time at RMB 13.5 million, compared to a loss of RMB 37.49 million in the same period last year [19][15] - Operating cash flow for the first half of 2023 was RMB 62.41 million, a significant increase of 116% year-on-year [20][11] Business Line Data and Key Metrics Changes - The CDMO revenue was RMB 46.55 million, reflecting a 105% increase compared to the previous year [11][17] - The company has focused on ADC technology, with the number of ADC projects increasing from 8 to 28, a growth of 250% [9][31] - The company has established the largest ADC commercial production line in China, with an annual production capacity of 530,000 units [11][16] Market Data and Key Metrics Changes - The market for ADCs is expected to grow significantly, with the potential for the market size of Bevacizumab in China to reach RMB 18.4 billion [5][9] - The company has initiated registration applications in 20 overseas countries, with 8 applications already accepted [7][9] Company Strategy and Development Direction - The company aims to continue focusing on the ADC CDMO market and expand into XDC and other antibody-based therapies [11][15] - The strategy includes enhancing the production capabilities and maintaining a competitive edge through a fully integrated ADC production platform [12][19] - The company plans to leverage its established relationships and technology to capture a larger share of the ADC market [11][27] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about maintaining growth momentum in the second half of 2023, expecting at least similar performance to the first half [11][15] - The company acknowledges the challenges in the financing environment for biotech firms but remains confident in the demand for ADCs [11][27] - The management highlighted the importance of strategic partnerships and collaborations to enhance market presence and operational efficiency [12][31] Other Important Information - The company has achieved a project success delivery rate of 100%, indicating strong operational capabilities [12][19] - The workforce in the CDMO segment has increased by 13% since the end of 2020, with a focus on enhancing technical expertise [9][10] Q&A Session Summary Question: What is the current status of the company's orders and future timelines? - The company has a total order backlog of RMB 1.2 billion, with RMB 900 million expected to convert into revenue [20][21] Question: How does the company plan to expand its overseas market presence? - The company is focusing on emerging markets and has initiated collaborations to enhance its international footprint [27][30] Question: What are the key differences in customer structure compared to competitors? - The company has a strong focus on ADC projects, with a higher proportion of late-stage clinical projects compared to competitors [32][33]

Financial Performance - The group's operating revenue reached RMB 328,063 thousand, representing an 80% year-on-year increase, and a 147% increase when excluding one-time licensing income from the first half of 2022[2]. - Revenue for the six months ended June 30, 2023, was RMB 328,063,000, compared to RMB 182,019,000 for the same period in 2022, indicating an increase of about 80%[32]. - Sales revenue amounted to RMB 277,881 thousand, a significant increase of 167%, primarily driven by strong sales performance of the core product, Bevacizumab (Bai Xin Ting) biosimilar[56]. - The company's CDMO/CMO revenue for the first half of 2023 was RMB 46,546 thousand, an increase of RMB 23,889 thousand or 105% compared to RMB 22,657 thousand in the same period of 2022[110]. - The company's net loss for the first half of 2023 was RMB 15,163 thousand, a decrease of RMB 561 thousand or 4% from a net loss of RMB 15,724 thousand in the same period of 2022[134]. Cash Flow and Expenses - Operating cash flow showed a positive trend, with net cash flow from operating activities increasing by 116% to RMB 62,413 thousand[2]. - The financial cost for the first half of 2023 was RMB 2,261 thousand, a decrease of RMB 1,157 thousand from RMB 3,418 thousand in the same period of 2022[140]. - The company reported a significant increase in R&D expenses, totaling RMB 197,376 thousand, compared to RMB 70,268 thousand in the previous year[3]. - Research and development expenses for the first half of 2023 amounted to RMB 49,969 thousand, down from RMB 70,268 thousand in the same period of 2022[134]. Project Development and Collaborations - The group focused on ADC CDMO differentiated competition, with 45 ongoing projects, of which 28 are ADC projects, accounting for 62%[2]. - In the first half of the year, 20 new projects were added, including 15 ADC projects, which included 3 new pre-BLA ADC projects[2]. - The company has established partnerships for ADC projects with several biopharmaceutical companies, showcasing its capabilities in the ADC CDMO field[83]. - The company established multiple strategic collaborations, including with Shijian Biotech for ADC drug development and commercialization[164]. Market Outlook - The market size for Bevacizumab in China is projected to reach RMB 18.4 billion by 2030, with a compound annual growth rate of 8.3% from 2021 to 2030[62]. - The Chinese biopharmaceutical market is expected to grow from RMB 410 billion in 2021 to RMB 710.2 billion by 2025, with a compound annual growth rate of 14.7%[66]. - The ADC drug market is projected to grow from $7.9 billion in 2022 to $64.7 billion by 2030, with a compound annual growth rate (CAGR) of 30%[186]. - By 2030, the ADC CDMO market is projected to grow significantly to $11 billion, with a CAGR of 28.4% from 2022 to 2030[193]. Production Capacity and Infrastructure - The company has established a commercial production line for ADCs, with a total production capacity exceeding 20,000L, equipped with industry-leading facilities[95]. - The company has two ADC production lines with an annual capacity of 5.3 million vials, operating at a speed of 200 vials per minute[181]. - The ADC production workshop has three independent rooms with an annual production capacity of 150 batches and a designed output of 600 kg[149]. - The company has built a quality management system compliant with international standards, supporting the commercialization of two listed products[170]. Corporate Governance and Strategy - The company has adopted the principles and code of conduct outlined in the corporate governance code as a basis for its corporate governance practices[175]. - The company aims to become a leading and trusted partner in the biopharmaceutical industry, focusing on enhancing service quality and technical capabilities[132]. - The company is committed to long-term sustainable development by enhancing team communication and collaboration, aiming to become a trusted partner in the biopharmaceutical industry[106]. - The board has resolved not to declare an interim dividend for the six months ended June 30, 2023[195].