Investment Rating - The report maintains a "Recommended" investment rating for the pharmaceutical industry as of September 15, 2025 [1] Core Insights - The trend of Chinese innovative drugs going overseas continues, with a focus on selective opportunities. The report highlights that the global pharmaceutical transaction volume reached 456 deals in the first half of 2025, a 32% year-on-year increase, with upfront payments totaling $11.8 billion, a 136% surge, and total transaction value hitting $130.4 billion, up 58% year-on-year [2] - The report emphasizes the promising clinical data from Chinese innovative drugs presented at the World Lung Cancer Conference, particularly in the ADC (Antibody-Drug Conjugate) field, showcasing significant efficacy advantages [3] - The report discusses the potential of small nucleic acid drugs and innovative delivery systems, indicating new market opportunities arising from strategic collaborations between Chinese companies and multinational corporations [4] - The CXO (Contract Research Organization) sector is expected to gradually recover, with a notable increase in orders anticipated in the third quarter of 2025, driven by improved innovation environments and funding from license-out transactions [5] - The 2025 medical insurance negotiation and commercial insurance innovative drug directory work has commenced, with a focus on orphan drugs and breakthrough treatment varieties [6] Summary by Sections 1. Pharmaceutical Market Tracking - The pharmaceutical industry underperformed the CSI 300 index by 1.75% in the past week, with a recent one-month increase of 3.32%, lagging behind the CSI 300 by 5.81% [22][26] - The medical device sector showed the highest weekly increase of 2.23%, while the chemical pharmaceutical sector experienced a decline of 2.57% [31] 2. Pharmaceutical Sector Trends and Valuation - The pharmaceutical industry index's current PE (TTM) stands at 40.60, above the five-year historical average of 31.60 [46] - The report notes that the pharmaceutical sector has shown a 15.06% increase over the past three months, outperforming the CSI 300 by 16.11% [43] 3. Recent Research Achievements - The report outlines recent research achievements by the Huaxin pharmaceutical team, including various in-depth and commentary reports on innovative drug developments and market trends [50] 4. Recent Industry Policies and News - The report details recent policy updates from the National Healthcare Security Administration regarding the 2025 drug directory adjustments and the approval of new drug applications [52][55]

Core Insights - FTSE Russell updated its FTSE Global Equity Index Series, including several Hong Kong stocks in the FTSE China Small Cap Index, effective after market close on September 19 [1] - The inclusion of stocks like Ninebot Holdings (09636) reflects international capital market recognition of their future growth potential and long-term investment value [1] - This adjustment is expected to attract additional capital inflows, enhance liquidity in the secondary market, and increase global market visibility for the companies involved [1] Company Impact - Ninebot Holdings (09636) and others included in the index are likely to benefit from increased attention and credibility in the global capital markets due to the endorsement by a well-known index [1] - The inclusion in the FTSE Russell indices signifies a positive outlook for these companies, potentially leading to a rise in stock prices and investor interest [1] - The FTSE Russell indices are widely used by global institutional and retail investors, with approximately $20 trillion in assets benchmarked to these indices, indicating significant market influence [1]

Core Viewpoint - The inclusion of stocks such as 九方智投控股 (09636) and others in the FTSE Global Equity Index Series reflects international capital market recognition of their future development potential and long-term investment value [1] Group 1: Index Inclusion - 九方智投控股 (09636), 和誉-B (02256), 第四范式 (06682), 科济药业-B (02171), and 顺丰同城 (09699) have been added to the FTSE China Small Cap Index, effective after market close on September 19 [1] - The FTSE Russell is a leading player in the global index industry, providing benchmarks, analytics, and data solutions widely used by institutional and retail investors [1] Group 2: Market Impact - The inclusion in the FTSE Russell Global Equity Index Series is expected to bring more potential incremental capital inflows to the companies' stocks, enhancing liquidity in the secondary market [1] - The endorsement from a globally recognized index is likely to increase the companies' visibility and recognition in the global capital markets, aiding in the realization of their long-term investment value [1]

截至月份: 2025年8月31日 狀態: 新提交 致：香港交易及結算所有限公司 公司名稱: 科濟藥業控股有限公司 呈交日期: 2025年9月4日 I. 法定/註冊股本變動 股份發行人及根據《上市規則》第十九B章上市的香港預託證券發行人的證券變動月報表 III.已發行股份及/或庫存股份變動詳情 | 1. 股份分類 | 普通股 | 股份類別 | 不適用 | | 於香港聯交所上市 (註1) | | | 是 | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | 證券代號 (如上市) | 02171 | 說明 | | | | | | | | | | | 法定/註冊股份數目 | | | 面值 | | | 法定/註冊股本 | | | 上月底結存 | | | 200,000,000,000 | USD | | 0.00000025 | USD | | 50,000 | | 增加 / 減少 (-) | | | | | | | USD | | | | 本月底結存 | | | 200,000,000,000 | USD | | 0.00000025 ...

Company Information [Board of Directors](index=3&type=section&id=Board%20of%20Directors) The Board comprises executive, non-executive, and independent non-executive directors, with Dr Zonghai Li serving as Chairman[7](index=7&type=chunk) - The Board of Directors includes executive directors Dr Zonghai Li (Chairman), Dr Huamao Wang, and Dr Hua Jiang; non-executive directors Mr Bingsen Guo, Mr Ronggang Xie, and Mr Huaqing Guo; and independent non-executive directors Dr Guangmei Yan, Dr Wen Zhou, and Ms Xiangke Zhao[7](index=7&type=chunk) - The Audit Committee is chaired by Ms Xiangke Zhao, the Remuneration Committee by Dr Wen Zhou, and the Nomination and Corporate Governance Committee by Dr Zonghai Li[7](index=7&type=chunk)[8](index=8&type=chunk) [Company Contact Information](index=3&type=section&id=Company%20Contact%20Information) The company provides detailed contact information for its headquarters, principal business places, and key service providers[7](index=7&type=chunk)[8](index=8&type=chunk) - The company's headquarters is located at 1/F, Building 2, 466 Yindu Road, Xuhui District, Shanghai, China, with its principal place of business in Hong Kong at Room 1918, 19/F, Lee Garden One, 33 Hysan Avenue, Causeway Bay[7](index=7&type=chunk) - The auditor is Ernst & Young, and the company's website is www.carsgen.com[8](index=8&type=chunk) Financial Highlights [Revenue](index=4&type=section&id=Revenue) For the six months ended June 30, 2025, revenue was primarily generated from the ex-factory delivery of Zevor-cel Revenue Overview | Metric | Six Months Ended June 30, 2025 (RMB million) | | :--- | :--- | | Revenue | 51 | - Revenue is mainly derived from Zevor-cel (zevogenleucel injection), calculated at the ex-factory price and recognized upon product delivery[9](index=9&type=chunk) [Gross Profit](index=4&type=section&id=Gross%20Profit) The company achieved a gross profit of approximately RMB 29 million, reflecting a strong cost advantage from in-house production Gross Profit Overview | Metric | Six Months Ended June 30, 2025 (RMB million) | | :--- | :--- | | Gross Profit | 29 | - The company demonstrates a strong cost advantage in the commercialization stage, mainly due to stable and high-yield in-house production of plasmids and vectors[10](index=10&type=chunk) [Net Loss](index=4&type=section&id=Net%20Loss) Net loss significantly narrowed by RMB 277 million, driven by positive net other income/losses and reduced operating expenses Net Loss Change | Metric | Six Months Ended June 30, 2025 (RMB million) | Six Months Ended June 30, 2024 (RMB million) | Change (RMB million) | | :--- | :--- | :--- | :--- | | Net Loss | (75) | (352) | 277 decrease | - The reduction in loss was primarily due to: (i) a shift in other net losses and gains from a loss of **RMB 54 million** to a gain of **RMB 58 million**; (ii) a **RMB 116 million** decrease in R&D expenses to **RMB 130 million**; (iii) a **RMB 47 million** decrease in administrative expenses to **RMB 39 million**; and (iv) an increase in gross profit from **RMB 1.6 million** to **RMB 29 million**[11](index=11&type=chunk) [Adjusted Net Loss](index=4&type=section&id=Adjusted%20Net%20Loss) Adjusted net loss decreased by approximately RMB 270 million, reflecting improved operational efficiency and cost control Adjusted Net Loss Change | Metric | Six Months Ended June 30, 2025 (RMB million) | Six Months Ended June 30, 2024 (RMB million) | Change (RMB million) | | :--- | :--- | :--- | :--- | | Adjusted Net Loss | (72) | (342) | 270 decrease | - The decrease in adjusted net loss was mainly due to an increase in other net income, reduced R&D and administrative expenses, higher gross profit, and lower share-based compensation[12](index=12&type=chunk) [Cash and Bank Balances](index=4&type=section&id=Cash%20and%20Bank%20Balances) Cash reserves decreased due to operational and capital expenditures, but the company maintains sufficient liquidity through 2028 Cash and Bank Balances Change | Metric | June 30, 2025 (RMB million) | December 31, 2024 (RMB million) | Change (RMB million) | | :--- | :--- | :--- | :--- | | Cash and Bank Balances | 1,261 | 1,479 | 218 decrease | - The decrease in cash was primarily due to payments for R&D expenses, administrative expenses, and capital expenditures[13](index=13&type=chunk) - The company expects its cash, cash equivalents, and deposits to be **no less than RMB 1,100 million** by the end of 2025, with sufficient cash to support operations into 2028[13](index=13&type=chunk) Business Highlights [Zevor-cel® (CT053)](index=5&type=section&id=Zevor-cel%C2%AE%20(CT053)) Zevor-cel® has been approved in China for relapsed/refractory multiple myeloma and is being commercialized with Huadong Medicine - Zevor-cel® has received NMPA approval in China for the treatment of adult patients with relapsed or refractory multiple myeloma[15](index=15&type=chunk) - The company is collaborating with Huadong Medicine for the commercialization of Zevor-cel® in mainland China, having established a dedicated commercial team and leveraging China's multi-tiered insurance system to improve patient access[15](index=15&type=chunk) Zevor-cel® Commercialization Progress | Metric | First Half of 2025 | | :--- | :--- | | Provinces/Cities Covered | 20+ | | Valid Orders | 111 | [Surri-cel (CT041)](index=5&type=section&id=Surri-cel%20(CT041)) The New Drug Application for Surri-cel, targeting Claudin18.2, has been accepted by China's CDE for advanced gastric cancer - The NDA for Surri-cel has been accepted by the CDE of China's NMPA for the treatment of advanced gastric/gastroesophageal junction adenocarcinoma with positive Claudin18.2 expression after at least two prior lines of therapy[16](index=16&type=chunk) - The product was granted **Priority Review** by the CDE in May 2025 and received **Breakthrough Therapy Designation (BTD)** in March 2025[16](index=16&type=chunk) - Results from the confirmatory Phase II clinical trial in China (NCT04581473) were published in *The Lancet* and presented orally at the 2025 ASCO Annual Meeting[16](index=16&type=chunk) [Allogeneic CAR-T Cell Products](index=5&type=section&id=Allogeneic%20CAR-T%20Cell%20Products) The company is advancing multiple allogeneic CAR-T products using its proprietary THANK-uCAR® and THANK-u Plus™ platforms - CARsgen is advancing differentiated allogeneic CAR-T cell products using its proprietary THANK-uCAR® platform and has developed the upgraded THANK-u Plus™ platform to overcome the potential impact of NKG2A expression levels on efficacy[17](index=17&type=chunk) - Allogeneic CAR-T products in development include: **CT0596** (BCMA, R/R MM/PCL), **KJ-C2219** (CD19/CD20, B-cell tumors/autoimmune diseases), **KJ-C2320** (CD38, AML), **KJ-C2114** (solid tumors), and **KJ-C2526** (NKG2DL, AML/other malignancies/cellular senescence)[17](index=17&type=chunk) Management Discussion and Analysis [I. Overview](index=6&type=section&id=I.%20Overview) CARsgen is a biopharmaceutical company focused on developing innovative CAR-T cell therapies for hematologic malignancies and solid tumors - CARsgen is a biopharmaceutical company dedicated to developing innovative CAR-T cell therapies to address unmet clinical needs in hematologic malignancies, solid tumors, and autoimmune diseases[18](index=18&type=chunk) - The company has established end-to-end capabilities for CAR-T cell research and development, from target discovery and preclinical research to clinical development and commercial-scale manufacturing[18](index=18&type=chunk) - CARsgen's mission is to become a global leader in biopharmaceuticals, providing innovative and differentiated cell therapies to make cancer and other diseases curable for patients worldwide[18](index=18&type=chunk) [II. Business Review](index=6&type=section&id=II.%20Business%20Review) The company has made significant progress in its product pipeline, technological innovation, and manufacturing capabilities - The company continues to optimize its strategic focus and business layout, concentrating on developing breakthrough CAR-T cell products for patients with significant unmet medical needs[19](index=19&type=chunk) - The NDA for Surri-cel has been accepted by the NMPA, making it the **world's first and only CAR-T cell therapy for solid tumors to reach the NDA stage**[20](index=20&type=chunk) - The company is advancing several allogeneic CAR-T cell products using its proprietary THANK-uCAR® technology and the upgraded THANK-u Plus™ platform[20](index=20&type=chunk) [Products and Pipeline](index=6&type=section&id=Products%20and%20Pipeline) The company's diverse CAR-T pipeline includes marketed, NDA-stage, and clinical-stage products for various cancers and autoimmune diseases Major Products and Pipeline Overview | Candidate Product | Target | Indication | Clinical Stage/Status | | :--- | :--- | :--- | :--- | | Zevor-cel® (CT053) | BCMA | Relapsed/refractory multiple myeloma (4L+) | Marketed | | Surri-cel (CT041) | Claudin18.2 | Gastric/GEJ adenocarcinoma, pancreatic cancer, etc | NDA Stage/Phase II | | CT071 | GPRC5D | Relapsed/refractory multiple myeloma, plasma cell leukemia | Phase I/IIT | | CT011 | GPC3 | Hepatocellular carcinoma | IND Approved | | CT0596 (Allogeneic) | BCMA | Relapsed/refractory multiple myeloma, plasma cell leukemia | IIT | | KJ-C2219 (Allogeneic) | CD19/CD20 | B-cell tumors, SLE, and systemic sclerosis | IIT | | KJ-C2320 (Allogeneic) | CD38 | Acute myeloid leukemia | IIT | - Zevor-cel® was approved by the NMPA on February 23, 2024, and is being commercialized in mainland China in collaboration with Huadong Medicine, having received a **RMB 75 million** regulatory milestone payment with rights to up to **RMB 1,025 million** in further milestones[24](index=24&type=chunk) - Surri-cel's NDA has been accepted by the CDE with Priority Review and Breakthrough Therapy Designation, and its confirmatory Phase II trial data showed significant PFS improvement and clinically meaningful OS benefits in advanced G/GEJA patients compared to standard therapies[30](index=30&type=chunk)[31](index=31&type=chunk) - CT071, developed via the CARcelerate® platform, reduces manufacturing time to **around 30 hours**; an IIT study for newly diagnosed multiple myeloma showed an **ORR of 100%**, with **70% achieving sCR**[39](index=39&type=chunk)[40](index=40&type=chunk) - The allogeneic CAR-T product CT0596 (THANK-u Plus™) has shown encouraging efficacy signals in R/R MM patients, with **3 of 5 patients (60%)** achieving sCR/CR and **4 of 5 (80%)** achieving bone marrow MRD negativity at the first 4-week assessment, with a favorable safety profile[43](index=43&type=chunk) - Certain subsidiaries entered an agreement with a fund managed by SBG-Qihang (Zhuhai) Equity Investment Management Enterprise (Limited Partnership), where the investor subscribed to an **8% stake** in UCaThera Bio (Shanghai) Co, Ltd for **RMB 80,000,000**, granting UCaThera exclusive rights for allogeneic CAR-T products in mainland China[45](index=45&type=chunk) [Continuous R&D and Technological Innovation](index=12&type=section&id=Continuous%20R&D%20and%20Technological%20Innovation) The company leverages proprietary platforms like THANK-uCAR®, CARcelerate®, and CycloCAR® to address key challenges in CAR-T therapy - The company has established a comprehensive R&D platform covering the entire CAR-T development cycle, including target discovery, vector design, manufacturing, and quality control[46](index=46&type=chunk) - The **THANK-u Plus™ platform**, an upgrade to THANK-uCAR®, is designed to overcome the potential impact of NKG2A expression on allogeneic CAR-T efficacy and has shown significantly superior anti-tumor effects in animal studies[47](index=47&type=chunk) - The **CARcelerate® platform** can reduce CAR-T cell manufacturing time to approximately **30 hours**, producing younger, more potent cells, thereby improving efficiency, lowering costs, and increasing patient access[48](index=48&type=chunk) - **CycloCAR® technology**, through co-expression of cytokine IL-7 and chemokine CCL21, aims to enhance efficacy in solid tumors and reduce the need for lymphodepletion preconditioning[50](index=50&type=chunk) - **LADAR™ technology** (Local Action Driven by Artificial Receptor) is designed to address target availability challenges by precisely controlling immune cell action on cancer cells, reducing on-target, off-tumor toxicity[50](index=50&type=chunk) Intellectual Property Overview | Metric | As of June 30, 2025 | | :--- | :--- | | Total Patents | 300+ | | Granted Patents Worldwide | 140 | | New Patents Granted (since Jan 1, 2025) | 11 | | New Patent Applications (since Jan 1, 2025) | 16 | [Manufacturing](index=15&type=section&id=Manufacturing) The company has established vertically integrated, GMP-compliant manufacturing capabilities in both China and the United States - The company has established in-house, GMP-compliant, vertically integrated manufacturing capabilities for plasmids, lentiviral vectors, and CAR-T cell products to enhance efficiency, control, and cost-effectiveness[53](index=53&type=chunk) - The Jinshan manufacturing facility supports the commercial production of Zevor-cel® and is expected to provide stable support for the commercial production of Surri-cel[53](index=53&type=chunk) - In September 2024, the FDA re-inspected the RTP manufacturing facility in Durham, NC, which **passed with zero findings (no Form 483)**, leading to the lifting of the clinical hold in the US on October 31, 2024[54](index=54&type=chunk) [Industry Overview](index=16&type=section&id=Industry%20Overview) The global CAR-T cell therapy market continues to grow, driven by rising cancer incidence and technological advancements - The global CAR-T cell therapy market has experienced strong growth since the first product approval in 2017 and is expected to expand further[56](index=56&type=chunk) - As of the date of this report, **seven CAR-T cell products** have been approved by the US FDA, and **seven CAR-T cell products** have been approved by the China NMPA[56](index=56&type=chunk) - Significant unmet medical needs remain for cancer patients globally, particularly for innovative CAR-T cell products for the treatment of solid tumors[56](index=56&type=chunk) [Future and Outlook](index=16&type=section&id=Future%20and%20Outlook) The company will focus on advancing its lead products, developing innovative technologies, and expanding its global manufacturing footprint - The company will continue to focus on rapidly advancing the clinical development of Zevor-cel® and Surri-cel in China and overseas, with plans to promote these products in earlier lines of therapy[57](index=57&type=chunk) - The company will continue to develop innovative CAR-T technologies to further optimize the efficacy, safety, and affordability of its CAR-T cell therapy products[57](index=57&type=chunk) - The company will continue to expand its manufacturing capacity in China and the US to support clinical trials and future commercialization, while also establishing more external collaborations with leading research institutions and pharmaceutical companies[57](index=57&type=chunk) [III. Financial Review](index=17&type=section&id=III.%20Financial%20Review) The company's financial performance improved with a significantly narrowed net loss, driven by revenue growth and reduced expenses - The company has incurred operating losses annually since inception, with operating losses of **RMB 77 million** and **RMB 362 million** for the six months ended June 30, 2025 and 2024, respectively[58](index=58&type=chunk) - Net loss for the six months ended June 30, 2025, was **RMB 75 million**, a decrease of **RMB 277 million** from **RMB 352 million** in the same period last year[59](index=59&type=chunk) - The reduction in loss was primarily due to decreased R&D expenses, lower administrative expenses, higher net foreign exchange gains, and increased gross profit[59](index=59&type=chunk) [Overview](index=17&type=section&id=Overview) The company began generating revenue from Zevor-cel® sales but continues to experience operating losses from R&D and administrative activities - The company has one product, Zevor-cel®, approved for commercial sale on February 23, 2024, and has since generated revenue from product sales[58](index=58&type=chunk) Operating Loss Overview | Metric | Six Months Ended June 30, 2025 (RMB million) | Six Months Ended June 30, 2024 (RMB million) | | :--- | :--- | :--- | | Operating Loss | (77) | (362) | [Loss for the Period](index=17&type=section&id=Loss%20for%20the%20Period) Net loss for the period decreased substantially by RMB 277 million, reflecting improved revenue and effective cost management Net Loss for the Period Change | Metric | Six Months Ended June 30, 2025 (RMB million) | Six Months Ended June 30, 2024 (RMB million) | Change (RMB million) | | :--- | :--- | :--- | :--- | | Net Loss | (75) | (352) | 277 decrease | - The decrease in loss was mainly due to reduced R&D expenses, lower administrative expenses, higher net foreign exchange gains, and increased gross profit[59](index=59&type=chunk) [Non-IFRS Measures](index=17&type=section&id=Non-IFRS%20Measures) Adjusted net loss, a non-IFRS measure, is provided to better reflect the company's core business performance - Adjusted net loss and adjusted net loss per share are non-IFRS measures that exclude the impact of adjusted items such as share-based compensation[60](index=60&type=chunk) Reconciliation of Loss to Adjusted Loss | Metric | Six Months Ended June 30, 2025 (RMB thousand) | Six Months Ended June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Loss for the period | (75,483) | (351,558) | | Add: Share-based compensation | 3,684 | 9,190 | | Adjusted net loss | (71,799) | (342,368) | Reconciliation of Loss Per Share to Adjusted Loss Per Share | Metric | Six Months Ended June 30, 2025 (RMB) | Six Months Ended June 30, 2024 (RMB) | | :--- | :--- | :--- | | Loss per share for the period | (0.14) | (0.63) | | Add: Share-based compensation per share | 0.01 | 0.02 | | Adjusted net loss per share | (0.13) | (0.61) | [Revenue](index=19&type=section&id=Revenue) Revenue grew significantly to RMB 50,961 thousand, primarily driven by the commercial sales of Zevor-cel® Revenue Change | Metric | Six Months Ended June 30, 2025 (RMB thousand) | Six Months Ended June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Revenue | 50,961 | 6,340 | [R&D Expenses](index=19&type=section&id=R&D%20Expenses) R&D expenses decreased by RMB 116 million due to lower employee benefits, depreciation, and clinical trial costs R&D Expenses Change | Metric | Six Months Ended June 30, 2025 (RMB thousand) | Six Months Ended June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Employee benefit expenses | 68,170 | 121,842 | | Testing and clinical expenses | 28,514 | 79,035 | | Depreciation of property, plant and equipment | 8,019 | 15,503 | | Total | 130,221 | 245,555 | - The **RMB 116 million** decrease in R&D expenses was mainly due to reductions in employee benefit expenses, depreciation of property, plant and equipment, and testing and clinical expenses[63](index=63&type=chunk) [Administrative Expenses](index=20&type=section&id=Administrative%20Expenses) Administrative expenses decreased by RMB 47 million, primarily from reduced employee benefits and professional service fees Administrative Expenses Change | Metric | Six Months Ended June 30, 2025 (RMB thousand) | Six Months Ended June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Employee benefit expenses | 21,620 | 32,447 | | Professional service fees | 5,816 | 22,863 | | Depreciation of property, plant and equipment | 533 | 15,346 | | Total | 39,029 | 86,313 | - The **RMB 47 million** decrease in administrative expenses was mainly due to reductions in employee benefit expenses, professional service fees, and depreciation of property, plant and equipment[64](index=64&type=chunk) [Employee Benefit Expenses and Share-Based Payments](index=21&type=section&id=Employee%20Benefit%20Expenses%20and%20Share-Based%20Payments) Total employee benefit expenses decreased due to a reduction in headcount and lower share-based compensation Employee Benefit Expenses Change | Metric | Six Months Ended June 30, 2025 (RMB thousand) | Six Months Ended June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Wages and salaries | 65,036 | 121,937 | | Pension costs | 7,546 | 10,367 | | Share-based compensation | 3,644 | 9,106 | | Other employee benefits | 13,564 | 12,879 | | Total | 89,790 | 154,289 | - The decrease in employee benefit expenses was mainly due to a reduction in headcount and lower employee salaries and share-based compensation, partially offset by annual salary increases and other employee benefits from severance compensation[65](index=65&type=chunk) Share-Based Compensation Expenses Change | Metric | Six Months Ended June 30, 2025 (RMB thousand) | Six Months Ended June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Administrative expenses | 779 | 2,398 | | R&D expenses | 2,865 | 6,708 | | Cost of sales | 40 | 84 | | Total | 3,684 | 9,190 | [Liquidity and Capital Resources](index=22&type=section&id=Liquidity%20and%20Capital%20Resources) The company relies on equity and debt financing, with cash balances decreasing due to net cash used in operating activities - The company relies on equity and debt financing as its primary sources of liquidity[67](index=67&type=chunk) Cash Flow Overview | Metric | Six Months Ended June 30, 2025 (RMB thousand) | Six Months Ended June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Net cash used in operating activities | (196,308) | (255,947) | | Net cash from investing activities | 1,715 | 6,584 | | Net cash (used in)/from financing activities | (29,635) | 24,688 | | Net decrease in cash and cash equivalents | (224,228) | (224,675) | - As of June 30, 2025, cash and bank balances were **RMB 1,261 million**, a decrease of **RMB 218 million** from **RMB 1,479 million** on December 31, 2024, mainly due to investments in R&D, administrative, and capital expenditures[72](index=72&type=chunk) [Borrowings and Gearing Ratio](index=24&type=section&id=Borrowings%20and%20Gearing%20Ratio) The company's total borrowings were reduced to zero, significantly lowering its gearing ratio to 7.2% Borrowings and Gearing Ratio Change | Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total Borrowings (RMB million) | 0 | 89 | | Gearing Ratio | 7.2% | 15.75% | [Lease Liabilities](index=24&type=section&id=Lease%20Liabilities) Lease liabilities for offices and dormitories decreased slightly during the period Lease Liabilities Change | Metric | June 30, 2025 (RMB million) | December 31, 2024 (RMB million) | | :--- | :--- | :--- | | Lease Liabilities | 69 | 77 | [Material Investments, Acquisitions, and Disposals](index=24&type=section&id=Material%20Investments,%20Acquisitions,%20and%20Disposals) The company did not engage in any material investments, acquisitions, or disposals during the reporting period - As of June 30, 2025, the company did not hold any significant investments valued at or exceeding **5% of its total assets**[77](index=77&type=chunk) - For the six months ended June 30, 2025, the company had no material acquisitions or disposals of subsidiaries, associates, or joint ventures[78](index=78&type=chunk) [Foreign Exchange Risk](index=25&type=section&id=Foreign%20Exchange%20Risk) The company is exposed to foreign exchange risk from operations in the US and China but currently has no hedging instruments - The Group's entities operate in the United States and the People's Republic of China, and certain cash balances, receivables, and payables are denominated in currencies other than the functional currencies of the respective entities[79](index=79&type=chunk) - As of June 30, 2025, the Group did not have any foreign exchange hedging instruments or policies, but management continuously monitors foreign exchange risk and will consider appropriate hedging measures[79](index=79&type=chunk) [Capital Expenditure](index=25&type=section&id=Capital%20Expenditure) Capital expenditure for the period totaled approximately RMB 2.8 million, primarily for equipment and software purchases Capital Expenditure Overview | Metric | Six Months Ended June 30, 2025 (RMB million) | | :--- | :--- | | Total Capital Expenditure | 2.8 | - The majority of capital expenditure was for the purchase of property, plant and equipment, and software[80](index=80&type=chunk) [Pledge of Assets and Contingent Liabilities](index=25&type=section&id=Pledge%20of%20Assets%20and%20Contingent%20Liabilities) The company had no pledged assets or material contingent liabilities as of the reporting date - As of June 30, 2025, and December 31, 2024, the Group had not pledged any assets[81](index=81&type=chunk) - As of June 30, 2025, the Group did not have any material contingent liabilities[82](index=82&type=chunk) [Employees and Remuneration Policy](index=25&type=section&id=Employees%20and%20Remuneration%20Policy) The company's employee count decreased, while it maintained competitive remuneration policies to attract and retain talent Employee Headcount Change | Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Number of Employees | 371 | 468 | - The company's employee remuneration includes salaries, bonuses, share incentive plans, social insurance contributions, and other benefits[84](index=84&type=chunk) - The company invests in continuous education and training programs and offers competitive salaries, project incentives, and stock incentive plans, especially for key employees[84](index=84&type=chunk) [Future Investment Plans and Expected Funding](index=26&type=section&id=Future%20Investment%20Plans%20and%20Expected%20Funding) The company plans to expand globally through organic growth and potential acquisitions, funded by a mix of financing channels - The Group will continue to expand in China and global markets through in-house R&D, mergers and acquisitions, and other means[85](index=85&type=chunk) - The company will utilize a variety of financing channels to fund capital expenditures, including internal funds, capital markets, and bank loans, and currently has sufficient bank credit facilities[85](index=85&type=chunk) [IV. Principal Risks and Uncertainties](index=26&type=section&id=IV.%20Principal%20Risks%20and%20Uncertainties) The company faces risks including sustained net losses, reliance on product success, intense competition, and regulatory hurdles - The company has incurred **significant net losses and net operating cash outflows** since its inception and expects to continue incurring them for the foreseeable future, with no guarantee of achieving profitability[86](index=86&type=chunk) - The company is heavily dependent on the success of its product candidates, most of which are in preclinical or clinical development; failure to successfully complete development, obtain regulatory approval, and commercialize them would severely harm the business[89](index=89&type=chunk) - The clinical development process for biopharmaceutical products is **lengthy, costly, and fraught with uncertainty**[89](index=89&type=chunk) - All major aspects of biopharmaceutical product R&D, manufacturing, and commercialization are subject to **strict regulation**, and failure to comply could negatively impact the business[89](index=89&type=chunk) - The company's product candidates are cell therapies with **complex manufacturing processes**, which may lead to difficulties, delays, or an inability to maintain a commercially viable cost structure[90](index=90&type=chunk) - Failure to obtain and maintain adequate patent and other intellectual property protection for product candidates could allow third parties to develop and commercialize similar or identical products, adversely affecting the company[94](index=94&type=chunk) Corporate Governance and Other Information [I. Interim Dividend](index=29&type=section&id=I.%20Interim%20Dividend) The Board of Directors has recommended not to pay an interim dividend for the reporting period - The Board of Directors recommends that no interim dividend be paid to shareholders for the reporting period[96](index=96&type=chunk) [II. Compliance with the Model Code for Securities Transactions](index=29&type=section&id=II.%20Compliance%20with%20the%20Model%20Code%20for%20Securities%20Transactions) The company has adopted and complied with the Model Code, with all directors confirming their adherence during the period - The company has adopted the Model Code, and upon specific inquiry, all directors confirmed their compliance with the Model Code during the reporting period[97](index=97&type=chunk) - During the reporting period, the company was not aware of any instances of non-compliance with the Model Code by its employees[97](index=97&type=chunk) [III. Compliance with the Corporate Governance Code](index=29&type=section&id=III.%20Compliance%20with%20the%20Corporate%20Governance%20Code) The company complied with all applicable provisions of the Corporate Governance Code, except for the separation of Chairman and CEO roles - During the reporting period, the company complied with all applicable code provisions of the Corporate Governance Code, with the exception of code provision C.2.1[98](index=98&type=chunk) - Dr Zonghai Li currently serves as both Chairman and Chief Executive Officer; the Board believes this arrangement facilitates effective execution of strategic plans and enhances communication between management and the Board[98](index=98&type=chunk) [IV. Audit Committee](index=30&type=section&id=IV.%20Audit%20Committee) The Audit Committee has reviewed the interim financial results and confirmed their compliance with accounting standards - The Audit Committee consists of three members: Ms Xiangke Zhao (Chairlady), Mr Huaqing Guo, and Dr Wen Zhou[99](index=99&type=chunk) - The Audit Committee has reviewed and endorsed the accounting principles and practices adopted by the Group and has discussed internal control and financial reporting matters with management[99](index=99&type=chunk) - The Audit Committee is of the opinion that the interim financial results for the six months ended June 30, 2025, have been prepared in compliance with relevant accounting standards, rules, and regulations, and that appropriate disclosures have been made[99](index=99&type=chunk) [V. Changes in Information of Directors and Chief Executive under Rule 13.51B(1) of the Listing Rules](index=30&type=section&id=V.%20Changes%20in%20Information%20of%20Directors%20and%20Chief%20Executive%20under%20Rule%2013.51B(1)%20of%20the%20Listing%20Rules) There have been no changes to the information of directors and the chief executive that require disclosure under the Listing Rules - Since the publication of the company's 2024 annual report, there have been no changes in the information of the directors and the chief executive that require disclosure under Rule 13.51B(1) of the Listing Rules[100](index=100&type=chunk) - Dr Wen Zhou has confirmed his independence and has no financial or other interests, nor any connections with any core connected persons of the company[100](index=100&type=chunk) [VI. Interests and Short Positions of Directors and Chief Executive in Shares, Underlying Shares and Debentures of the Company and its Associated Corporations](index=31&type=section&id=VI.%20Interests%20and%20Short%20Positions%20of%20Directors%20and%20Chief%20Executive) Several directors are deemed to have a collective interest of 37.79% in the company's shares through controlled corporations Long Positions of Directors and Chief Executive in the Company's Shares | Name of Director/Chief Executive | Capacity | Number of Shares/Nature | Approximate Percentage of Interest in the Company | | :--- | :--- | :--- | :--- | | Dr Zonghai Li | Interest of controlled corporation & concert party | 217,648,730/Long position | 37.79% | | Mr Bingsen Guo | Interest of controlled corporation & concert party | 217,648,730/Long position | 37.79% | | Dr Huamao Wang | Interest of controlled corporation & concert party | 217,648,730/Long position | 37.79% | | Mr Huaqing Guo | Beneficial owner, interest of controlled corporation & concert party | 217,648,730/Long position | 37.79% | | Dr Hua Jiang | Beneficial owner | 3,390,156/Long position | 0.59% | - Dr Zonghai Li, Mr Bingsen Guo, Dr Huamao Wang, Mr Huaqing Guo, Mr Haiou Chen, indirect entities, Ms Xuehong Yang, Yide Holdings, Ms Xiaojing Guo, and Quanzhou Dingwo (Limited Partnership) entered into a Concert Party Agreement on February 22, 2021, under which each party is deemed to be interested in the shares held by the others[101](index=101&type=chunk) [VII. Interests and Short Positions of Substantial Shareholders](index=32&type=section&id=VII.%20Interests%20and%20Short%20Positions%20of%20Substantial%20Shareholders) Yijie Biotech and its associated parties are deemed to have a collective interest of 37.79% in the company's shares Long Positions of Substantial Shareholders in the Company's Shares | Name of Shareholder | Capacity | Number of Shares/Nature | Approximate Percentage of Interest in the Company | | :--- | :--- | :--- | :--- | | CART Biotech Limited | Interest of controlled corporation & concert party | 217,648,730/Long position | 37.79% | | Redelle Holding Limited | Interest of controlled corporation & concert party | 217,648,730/Long position | 37.79% | | He Xi Holdings Limited | Interest of controlled corporation & concert party | 217,648,730/Long position | 37.79% | | CANDOCK Holdings Limited | Interest of controlled corporation & concert party | 217,648,730/Long position | 37.79% | | Mr Haiou Chen | Beneficial interest, interest of controlled corporation & concert party | 217,648,730/Long position | 37.79% | | Accure Biotech Limited | Interest of controlled corporation & concert party | 217,648,730/Long position | 37.79% | | Ms Xuehong Yang | Interest of controlled corporation & concert party | 217,648,730/Long position | 37.79% | | Yide Holdings | Beneficial interest & concert party | 217,648,730/Long position | 37.79% | | Ms Xiaojing Guo | Interest of controlled corporation & concert party | 217,648,730/Long position | 37.79% | | Quanzhou Dingwo (LP) | Beneficial interest & concert party | 217,648,730/Long position | 37.79% | | Yijie Biotech | Beneficial interest & concert party | 217,648,730/Long position | 37.79% | - Yijie Biotech is owned by CART Biotech Limited (69.00%), Redelle Holding Limited (10.20%), He Xi Holdings Limited (10.00%), Candock Holdings Limited (10.00%), and Accure Biotech Limited (0.80%)[107](index=107&type=chunk) [VIII. Directors' Rights to Acquire Shares or Debentures](index=33&type=section&id=VIII.%20Directors'%20Rights%20to%20Acquire%20Shares%20or%20Debentures) No directors or their associates were granted or exercised rights to acquire shares or debentures during the period - At the end of the reporting period, no director or their respective spouse or children under 18 had been granted or had exercised any rights to benefit by the acquisition of shares or debentures of the company[105](index=105&type=chunk) [IX. Legal Proceedings](index=33&type=section&id=IX.%20Legal%20Proceedings) The company and its subsidiaries were not involved in any material litigation or arbitration as of the reporting date - As of June 30, 2025, to the best of the company's knowledge, neither the company nor its subsidiaries were involved in any material litigation or arbitration, and there were no material pending or threatened claims against them[106](index=106&type=chunk) [X. Purchase, Sale or Redemption of the Company's Listed Securities](index=34&type=section&id=X.%20Purchase,%20Sale%20or%20Redemption%20of%20the%20Company's%20Listed%20Securities) Neither the company nor its subsidiaries purchased, sold, or redeemed any of the company's listed securities during the period - Neither the company nor any of its subsidiaries acquired, sold, or redeemed any of the company's listed securities during the reporting period[108](index=108&type=chunk) - As of June 30, 2025, the company did not hold any treasury shares, and there were no shares that had been repurchased but not cancelled[109](index=109&type=chunk) [XI. Use of Proceeds from the Global Offering](index=34&type=section&id=XI.%20Use%20of%20Proceeds%20from%20the%20Global%20Offering) The net proceeds from the 2021 global offering have been largely utilized as intended, with the remainder expected to be used by 2026 - The company's shares were listed on the Stock Exchange on June 18, 2021, raising net proceeds of approximately **HK$3,008 million** from the global offering[110](index=110&type=chunk) Use of Net Proceeds from the Global Offering (as of June 30, 2025) | Use of Proceeds | Planned Allocation (HK$ million) | Amount Utilized (as of June 30, 2025) (RMB million) | Balance (as of June 30, 2025) (RMB million) | | :--- | :--- | :--- | :--- | | Further development of core product BCMA CAR-T (CT053) | 902.4 | 851.7 | 0 | | R&D for other ongoing and planned pipeline candidates | 932.5 | 759.6 | 90.3 | | Building comprehensive manufacturing and commercialization capabilities | 601.6 | 415.2 | 133.1 | | Upgrading CAR-T technology and early-stage R&D | 300.8 | 214.7 | 59.4 | | Working capital and other general corporate purposes | 270.7 | 255.5 | 0 | | **Total** | **3,008.0** | **2,496.7** | **282.8** | - The unutilized net proceeds are expected to be fully used for their intended purposes by 2026, later than originally planned due to cost savings from improved operational efficiency and insourcing of previously outsourced services[111](index=111&type=chunk) [XII. Events After the Reporting Period](index=35&type=section&id=XII.%20Events%20After%20the%20Reporting%20Period) There were no significant events after the reporting period that would require disclosure or adjustment - As of the date of this report, the Group has had no significant events after the reporting period that would require additional disclosure or adjustment[113](index=113&type=chunk) [XIII. Continuing Disclosure Obligations under the Listing Rules](index=35&type=section&id=XIII.%20Continuing%20Disclosure%20Obligations%20under%20the%20Listing%20Rules) The company has no other disclosure obligations under Rules 13.20, 13.21, and 13.22 of the Listing Rules - The company has no other disclosure obligations under Rules 13.20, 13.21, and 13.22 of the Listing Rules[114](index=114&type=chunk) [XIV. Share Incentive Schemes](index=36&type=section&id=XIV.%20Share%20Incentive%20Schemes) The company operates three share incentive schemes to attract, motivate, and retain qualified participants - The company has adopted three share incentive schemes: the 2019 Equity Incentive Plan, the Post-IPO RSU Scheme, and the Post-IPO Share Option Scheme[115](index=115&type=chunk) - These schemes are designed to attract, motivate, retain, and reward certain employees, directors, and other qualified individuals of the Group by aligning their interests with those of the Group through share ownership[116](index=116&type=chunk)[127](index=127&type=chunk)[130](index=130&type=chunk) [2019 Equity Incentive Plan](index=36&type=section&id=2019%20Equity%20Incentive%20Plan) This plan aims to incentivize and reward employees, directors, and other eligible persons for their contributions to the Group - The 2019 Equity Incentive Plan is designed to attract, motivate, retain, and reward certain employees, directors, and other qualified persons of the Group[116](index=116&type=chunk) Outstanding Options under the 2019 Equity Incentive Plan | Metric | Number of Shares Underlying Options Outstanding at Jan 1, 2025 | Number of Shares Underlying Options Outstanding at June 30, 2025 | | :--- | :--- | :--- | | Total | 10,290,851 | 7,768,259 | Unvested Share Awards under the 2019 Equity Incentive Plan | Metric | Number of Shares Underlying Unvested RSUs at Jan 1, 2025 | Number of Shares Underlying Unvested RSUs at June 30, 2025 | | :--- | :--- | :--- | | Total | 155,179 | 63,475 | [Post-IPO RSU Scheme](index=39&type=section&id=Post-IPO%20RSU%20Scheme) This scheme aligns the interests of eligible participants with the Group's long-term development through share ownership - The purpose of the Post-IPO RSU Scheme is to align the interests of eligible persons with those of the Group through share ownership, encouraging and retaining them to contribute to the Group's long-term development and interests[127](index=127&type=chunk) Unvested Share Awards under the Post-IPO RSU Scheme | Metric | Number of Shares Underlying Unvested RSUs at Jan 1, 2025 | Number of Shares Underlying Unvested RSUs at June 30, 2025 | | :--- | :--- | :--- | | Total | 1,756,495 | 2,705,545 | - During the reporting period, the number of shares issuable under share awards granted through the Post-IPO RSU Scheme represented **0.30%** of the weighted average number of issued shares (excluding treasury shares, if any)[127](index=127&type=chunk) [Post-IPO Share Option Scheme](index=40&type=section&id=Post-IPO%20Share%20Option%20Scheme) This scheme rewards employees for their past contributions and encourages their continued commitment to the company's success - The Post-IPO Share Option Scheme aims to reward employees who have contributed to the company's achievements and to encourage their further contributions[130](index=130&type=chunk) Outstanding Options under the Post-IPO Share Option Scheme | Metric | Number of Shares Underlying Options Outstanding at Jan 1, 2025 | Number of Shares Underlying Options Outstanding at June 30, 2025 | | :--- | :--- | :--- | | Total | 8,802,310 | 8,860,838 | - During the reporting period, the number of shares issuable under options granted through the Post-IPO Share Option Scheme represented **0.62%** of the weighted average number of issued shares (excluding treasury shares, if any)[130](index=130&type=chunk) [Summary of Share Incentive Schemes](index=43&type=section&id=Summary%20of%20Share%20Incentive%20Schemes) This section outlines the key terms of the company's three share incentive plans, including purpose, eligibility, and award limits - All three schemes aim to attract, motivate, and retain talent by aligning participant interests with the company's long-term development[138](index=138&type=chunk) - Eligible participants include employees, directors, officers, and consultants, with specific limits on the maximum number of shares and individual entitlements under each plan[138](index=138&type=chunk)[139](index=139&type=chunk) - The vesting and exercise periods for options and share awards are determined by the Board on a case-by-case basis, with corresponding provisions for exercise or purchase prices[139](index=139&type=chunk)[141](index=141&type=chunk)[142](index=142&type=chunk) Financial Statements [Interim Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=47&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) The company reported revenue of RMB 50,961 thousand and a significantly narrowed net loss of RMB 75,483 thousand Summary of Interim Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income | Metric | Six Months Ended June 30, 2025 (RMB thousand) | Six Months Ended June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Revenue | 50,961 | 6,340 | | Gross Profit | 29,369 | 1,617 | | Operating Loss | (76,704) | (361,540) | | Loss for the period attributable to owners of the parent | (75,483) | (351,558) | | Total comprehensive loss for the period attributable to owners of the parent | (125,730) | (265,132) | | Basic and diluted loss per share (RMB) | (0.14) | (0.63) | [Interim Condensed Consolidated Statement of Financial Position](index=48&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2025, the company's total assets were RMB 1,513,391 thousand, with net assets of RMB 962,133 thousand Summary of Interim Condensed Consolidated Statement of Financial Position | Metric | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Total non-current assets | 133,498 | 142,759 | | Total current assets | 1,379,893 | 1,530,275 | | Total current liabilities | 213,799 | 254,007 | | Total non-current liabilities | 337,459 | 362,320 | | Net assets | 962,133 | 1,056,707 | | Total equity | 962,133 | 1,056,707 | [Condensed Consolidated Statement of Changes in Equity](index=49&type=section&id=Condensed%20Consolidated%20Statement%20of%20Changes%20in%20Equity) Total equity decreased, primarily due to the loss for the period and exchange differences, partially offset by share-based payments Summary of Condensed Consolidated Statement of Changes in Equity | Metric | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Total attributable to owners of the parent | 962,133 | 1,056,707 | | Loss for the period | (75,483) | (8,987,961) (Accumulated losses) | | Other comprehensive income | (50,247) | (50,247) | | Share-based payments | 3,684 | 3,684 | | Issue of shares to employees under employee incentive schemes | 26,478 | 26,478 | [Interim Condensed Consolidated Statement of Cash Flows](index=50&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Cash%20Flows) Net cash used in operating activities was RMB 196,308 thousand, resulting in a decrease in cash and cash equivalents Summary of Interim Condensed Consolidated Statement of Cash Flows | Metric | Six Months Ended June 30, 2025 (RMB thousand) | Six Months Ended June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Net cash used in operating activities | (196,308) | (255,947) | | Net cash from investing activities | 1,715 | 6,584 | | Net cash (used in)/from financing activities | (29,635) | 24,688 | | Net decrease in cash and cash equivalents | (224,228) | (224,675) | | Cash and cash equivalents at end of period | 1,260,793 | 1,652,569 | Notes to the Interim Condensed Consolidated Financial Information [1. General Information](index=51&type=section&id=1.%20General%20Information) CARsgen Therapeutics Holdings Limited is a Cayman Islands-incorporated investment holding company with biopharmaceutical operations in China and the US - CARsgen Therapeutics Holdings Limited was incorporated in the Cayman Islands on February 9, 2018, as a limited liability company and acts as an investment holding company[150](index=150&type=chunk) - The Group operates as a biopharmaceutical company in mainland China and the United States, with end-to-end CAR-T cell R&D capabilities from target discovery to commercial-scale manufacturing[150](index=150&type=chunk) [2. Basis of Preparation](index=51&type=section&id=2.%20Basis%20of%20Preparation) The interim financial information has been prepared in accordance with IAS 34 and should be read with the 2024 annual financial statements - The interim condensed consolidated financial information is prepared in accordance with International Accounting Standard 34 Interim Financial Reporting[151](index=151&type=chunk) - This interim financial information does not include all the information and disclosures required in the annual financial statements and should be read in conjunction with the Group's annual consolidated financial statements for the year ended December 31, 2024[151](index=151&type=chunk) [3. Changes in Accounting Policies and Disclosures](index=51&type=section&id=3.%20Changes%20in%20Accounting%20Policies%20and%20Disclosures) The accounting policies adopted are consistent with the 2024 annual report, with no material impact from newly adopted IFRS amendments - The accounting policies adopted in the preparation of the interim condensed consolidated financial information are consistent with those applied in the preparation of the Group's annual consolidated financial statements for the year ended December 31, 2024, except for the adoption of the amendment to IAS 21 Lack of Exchangeability[152](index=152&type=chunk)[153](index=153&type=chunk) - The amendments had no impact on the interim condensed consolidated financial information as the currencies used for transactions and the functional currencies of the Group's entities are exchangeable[153](index=153&type=chunk) [4. Segment Information](index=52&type=section&id=4.%20Segment%20Information) The Group operates as a single business segment, with a significant portion of revenue derived from one major customer - The executive directors of the Group consider that the Group's business is operated and managed as a single operating segment, and therefore no further operating segment analysis is presented[154](index=154&type=chunk) Revenue from Major Customers | Customer | Six Months Ended June 30, 2025 (RMB thousand) | Six Months Ended June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Customer A | 50,961 | 6,340 | [5. Revenue and Other Income](index=52&type=section&id=5.%20Revenue%20and%20Other%20Income) Revenue was primarily from pharmaceutical product sales in mainland China, while other income included government grants and interest Revenue Analysis | Revenue Source | Six Months Ended June 30, 2025 (RMB thousand) | Six Months Ended June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Sales of pharmaceutical products | 48,263 | 5,925 | | Provision of cryopreservation services | 2,698 | 415 | | **Total** | **50,961** | **6,340** | - All revenue is derived from mainland China and is primarily from the sale of goods transferred at a point in time[156](index=156&type=chunk) Other Income Analysis | Other Income Source | Six Months Ended June 30, 2025 (RMB thousand) | Six Months Ended June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Government grants | 1,143 | 2,907 | | Interest income from time deposits | 4,495 | 20,155 | | **Total** | **5,638** | **23,062** | [6. Other Net Income/(Losses)](index=54&type=section&id=6.%20Other%20Net%20Income/(Losses)) The company recorded other net income of RMB 58,481 thousand, driven by significant net foreign exchange gains Other Net Income/(Losses) Change | Metric | Six Months Ended June 30, 2025 (RMB thousand) | Six Months Ended June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Net foreign exchange gains/(losses) | 59,841 | (53,476) | | Others | (1,360) | (154) | | **Total** | **58,481** | **(53,630)** | [7. Loss Before Tax](index=54&type=section&id=7.%20Loss%20Before%20Tax) Loss before tax from continuing operations narrowed significantly due to broad-based reductions in operating expenses Loss Before Tax and Major Expenses Change | Metric | Six Months Ended June 30, 2025 (RMB thousand) | Six Months Ended June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Loss before income tax | (75,483) | (351,558) | | Employee benefit expenses | 99,370 | 154,288 | | Testing and clinical expenses | 28,514 | 79,035 | | Depreciation of property, plant and equipment | 9,307 | 31,708 | | Professional service expenses | 5,816 | 22,664 | | R&D expenses | 130,221 | 245,555 | | Administrative expenses | 39,029 | 86,313 | [8. Income Tax Expense](index=55&type=section&id=8.%20Income%20Tax%20Expense) No income tax provision was made for the period as the company did not generate taxable profits in its operating jurisdictions - The company is incorporated in the Cayman Islands as an exempted company and is therefore exempt from Cayman Islands income tax[160](index=160&type=chunk) - The mainland China subsidiary, CARsgen Pharmaceutical, was recognized as a High and New Technology Enterprise in 2023, qualifying for a preferential tax rate of **15%** for three years starting from 2023[162](index=162&type=chunk) - No provision for mainland China corporate income tax or US corporate income tax was made as there were no assessable profits[163](index=163&type=chunk)[165](index=165&type=chunk) [9. Dividend](index=56&type=section&id=9.%20Dividend) No dividend was declared or paid by the company for the six months ended June 30, 2025 - No dividend was declared or paid by the company for the six months ended June 30, 2025[169](index=169&type=chunk) [10. Loss Per Share Attributable to Ordinary Equity Holders of the Parent](index=56&type=section&id=10.%20Loss%20Per%20Share%20Attributable%20to%20Ordinary%20Equity%20Holders%20of%20the%20Parent) Basic and diluted loss per share narrowed to RMB 0.14, with no dilution adjustment due to the anti-dilutive effect of potential shares Loss Per Share Calculation | Metric | Six Months Ended June 30, 2025 (RMB thousand/thousand shares/RMB) | Six Months Ended June 30, 2024 (RMB thousand/thousand shares/RMB) | | :--- | :--- | :--- | | Loss attributable to ordinary equity holders of the parent | (75,483) | (351,558) | | Weighted average number of ordinary shares for basic and diluted loss per share | 551,391 | 557,030 | | Basic and diluted loss per share | (0.14) | (0.63) | - No adjustment has been made to the basic loss per share amounts presented for the period in respect of dilution, as the impact of outstanding potential ordinary shares related to share-based payments and the put option for non-controlling interests of a subsidiary had an anti-dilutive effect[170](index=170&type=chunk) [11. Property, Plant and Equipment and Right-of-Use Assets](index=56&type=section&id=11.%20Property,%20Plant%20and%20Equipment%20and%20Right-of-Use%20Assets) The company incurred costs for property, plant, and equipment and recognized an impairment loss during the period Cost of Additions to Property, Plant and Equipment and Right-of-Use Assets | Asset Type | Six Months Ended June 30, 2025 (RMB thousand) | Six Months Ended June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Property, plant and equipment | 1,219 | 3,109 | | Right-of-use assets | 56 | 5,736 | - For the six months ended June 30, 2025, an impairment loss of **RMB 2,338 thousand** was recognized for property, plant and equipment[172](index=172&type=chunk) [12. Trade Receivables](index=57&type=section&id=12.%20Trade%20Receivables) Trade receivables increased, with all balances due from a single customer, posing a credit concentration risk Aging Analysis of Trade Receivables | Aging | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Within 1 year | 17,745 | 8,768 | | 1 to 2 years | 800 | – | | **Net carrying amount** | **18,545** | **8,768** | - Trade receivables are non-interest-bearing, and as of June 30, 2025, and December 31, 2024, the company had trade receivables of **RMB 18,545,000** and **RMB 8,768,000**, respectively, due from a single customer, indicating a credit concentration risk[173](index=173&type=chunk) [13. Other Current Assets and Prepayments](index=57&type=section&id=13.%20Other%20Current%20Assets%20and%20Prepayments) Other current assets and prepayments increased significantly, mainly due to a prepayment for a share repurchase Other Current Assets and Prepayments Change | Metric | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Recoverable value-added tax | 5,067 | 5,528 | | Prepayment for share repurchase | 30,987 | – | | Prepayments to suppliers | 12,096 | 10,651 | | **Total** | **48,150** | **16,179** | [14. Accrued Expenses and Other Payables](index=57&type=section&id=14.%20Accrued%20Expenses%20and%20Other%20Payables) Accrued expenses and other payables decreased, with accrued expenses primarily related to R&D activities Accrued Expenses and Other Payables Change | Metric | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Accrued expenses | 109,017 | 121,830 | | Payroll and welfare payables | 22,773 | 44,189 | | Amount due to employees for sale of shares under share incentive schemes | 16,861 | 4,857 | | **Total** | **157,116** | **181,623** | - Accrued expenses are mainly expenses incurred for research and development activities[175](index=175&type=chunk) [15. Contract Liabilities](index=58&type=section&id=15.%20Contract%20Liabilities) Contract liabilities primarily consist of customer advances from an exclusive agency agreement with Huadong Medicine Contract Liabilities Change | Metric | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Advances from customers (grant of exclusive agency agreement) | 235,827 | 249,907 | | Non-current | 203,091 | 222,284 | | Current | 32,736 | 27,623 | - Contract liabilities include an upfront payment received for granting exclusive agency rights related to the commercialization of zevogenleucel injection with Huadong Medicine[176](index=176&type=chunk) - The company has received an upfront payment of **RMB 200,000,000** and a milestone payment of **RMB 75,000,000** under the agreement[176](index=176&type=chunk) [16. Other Financial Liabilities](index=58&type=section&id=16.%20Other%20Financial%20Liabilities) The company recognized other financial liabilities related to a put option granted to Series A investors of a subsidiary Other Financial Liabilities Change | Metric | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Put option liabilities | 71,602 | – | - Other financial liabilities primarily represent a put option granted to Series A investors of a subsidiary, which allows them to require the Group or founding shareholders to repurchase their shares at the original investment cost plus **6% simple annual interest** if the subsidiary fails to complete a qualified IPO or business sale by 2032[178](index=178&type=chunk) [17. Share Capital](index=59&type=section&id=17.%20Share%20Capital) The company issued new ordinary shares to employees and a trustee under its incentive schemes during the period Issued and Fully Paid Share Capital | Metric | June 30, 2025 (thousand shares/RMB thousand) | December 31, 2024 (thousand shares/RMB thousand) | | :--- | :--- | :--- | | Number of ordinary shares | 575,904 | 571,671 | | RMB equivalent | 1 | 1 | - On April 16, 2025, the company allotted and issued **1,698,000 shares** to Carfe Unity Limited, a wholly-owned subsidiary of the Post-IPO RSU Scheme trustee, to be held in trust[180](index=180&type=chunk) - During the six months ended June 30, 2025, the company issued **2,535,450 ordinary shares** to employees under its employee incentive schemes for a consideration of **RMB 26,478 thousand**[180](index=180&type=chunk) Treasury Shares Movement | Metric | June 30, 2025 (thousand shares) | December 31, 2024 (thousand shares) | | :--- | :--- | :--- | | Treasury shares at end of period | 22,176 | 22,261 | [18. Reserves](index=61&type=section&id=18.%20Reserves) Total reserves decreased due to the loss for the period and negative currency translation differences Overview of Changes in Reserves | Metric | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Capital reserve | 54,800 | 54,800 | | Share premium | 9,415,636 | 9,388,164 | | Currency translation reserve | 456,558 | 506,805 | | Share-based compensation | 98,582 | 94,898 | | Accumulated losses | (9,063,444) | (8,987,961) | | **Total** | **962,132** | **1,056,706** | - The loss for the period and exchange differences led to a decrease in reserves, while share-based payments and the issuance of shares under employee incentive schemes increased reserves[184](index=184&type=chunk) [19. Commitments](index=62&type=section&id=19.%20Commitments) The company had minor capital expenditure commitments for property, plant, and equipment as of the reporting date Capital Expenditure Commitments | Category | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Property, plant and equipment | 61 | 15 | [20. Related Party Transactions](index=62&type=section&id=20.%20Related%20Party%20Transactions) Compensation for key management personnel decreased compared to the same period last year Key Management Personnel Compensation | Compensation Category | Six Months Ended June 30, 2025 (RMB thousand) | Six Months Ended June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Basic salaries, share-based payments, other allowances and benefits in kind | 3,913 | 8,799 | | Discretionary bonuses | 1,536 | 1,701 | | Social security expenses | 383 | 476 | | **Total** | **5,832** | **10,976** | [21. Approval of the Financial Statements](index=62&type=section&id=21.%20Approval%20of%20the%20Financial%20Statements) The interim condensed consolidated financial statements were approved and authorized for issue by the Board of Directors on August 14, 2025 - The interim condensed consolidated financial statements were approved and authorized for issue by the Board of Directors on August 14, 2025[188](index=188&type=chunk) Forward-Looking Statements This report contains forward-looking statements based on current views and assumptions, which are subject to significant risks and uncertainties - All statements in this report that are not historical facts or do not relate to current facts or conditions are forward-looking statements[190](index=190&type=chunk) - Such forward-looking statements are based on a number of assumptions and factors beyond the Group's control and are therefore subject to significant risks and uncertainties, and actual events or results may differ materially from these forward-looking statements[190](index=190&type=chunk) - The company makes no representation or warranty as to the achievement or reasonableness of, and should not be relied upon for, any projections, targets, estimates or forecasts[190](index=190&type=chunk) Definitions This section defines key terms and abbreviations used throughout the report to ensure accurate understanding - This section defines key terms used in the report, such as "HK$", "2019 Equity Incentive Plan", "Affiliate", "Audit Committee", "China", "the Company", and "Core Product"[191](index=191&type=chunk)[192](index=192&type=chunk) - It also includes explanations for important concepts like "Huadong Medicine", "Listing Rules", "Model Code", "NMPA", "Post-IPO RSU Scheme", "Post-IPO Share Option Scheme", "RMB", and "SFO"[194](index=194&type=chunk)[195](index=195&type=chunk) Glossary This section provides definitions for technical and clinical terms related to the biopharmaceutical industry used in the report - This section provides definitions for technical terms in the biopharmaceutical field, such as "Antigen", "CRS" (Cytokine Release Syndrome), "ASCO" (American Society of Clinical Oncology), "ASH" (American Society of Hematology), and "BCMA" (B-cell Maturation Antigen)[198](index=198&type=chunk) - It also includes CAR-T related technologies such as "CycloCAR®" (a next-generation CAR-T technology), "LADAR™" (Local Action Driven by Artificial Receptor technology), and "THANK-uCAR®" (a proprietary CAR-T cell technology)[199](index=199&type=chunk)[201](index=201&type=chunk) - It covers disease names (e.g, "MM" or "R/R MM" for multiple myeloma, "HCC" for hepatocellular carcinoma), regulatory agencies (e.g, "FDA" for the US Food and Drug Administration, "EMA" for the European Medicines Agency), and clinical trial phases (e.g, "Phase I", "Phase II", "confirmatory trial")[199](index=199&type=chunk)[201](index=201&type=chunk)

CARsgen Therapeutics Holdings Limited 科濟藥業控股有限公司 （「公司」） （於開曼群島註冊成立的有限公司） 提名及企業管治委員會職權範圍 1 定義 1. 就本職權範圍（「職權範圍」）而言： 董事會指公司之董事會。 財務高級副總裁指董事會不時委任負責管理財務之公司高級行政人員。 企業管治守則指上市規則附錄C1所載企業管治守則。 公司秘書指公司之公司秘書。 聯交所指香港聯合交易所有限公司。 成立 2. 提名及企業管治委員會於2021年5月21日根據董事會所通過的決議案成立。 2 成員 董事指董事會成員。 本集團指於有關期間，公司及其附屬公司和聯營公司；或若文義另有所指， 於公司成為其現時附屬公司和聯營公司之控股公司前之期間，公司之現時附 屬公司和聯營公司；或其現時附屬公司和聯營公司或其前身（視乎具體情況） 所營運之企業。 上市規則指《香港聯合交易所有限公司證券上市規則》（經不時修訂）。 提名及企業管治委員會指董事會根據本職權範圍第2條通過之決議而設立之提 名及企業管治委員會。 高級管理層指董事長、首席執行官、首席科學官、首席營運官、副總裁及高 級副總裁以及董事會不時決定出任公 ...

Core Viewpoint - WuXi AppTec's revenue for the first half of 2025 was 106.3 million yuan, with sales of its CAR-T drug, Regiokyuran, amounting to 81 million yuan, which is lower than the sales figures from the same period in 2024 and 2023 [1][2]. Group 1: Company Performance - WuXi AppTec's CAR-T drug sales of 81 million yuan in the first half of 2025 were below the 86.8 million yuan in 2024 and 87.7 million yuan in 2023 [2]. - Legend Biotech reported a global sales figure of 439 million USD (approximately 3.1 billion yuan) for its CAR-T drug in Q2 2025, with total sales for the first half reaching 808 million USD (approximately 5.7 billion yuan), marking a year-on-year growth of 100% [4]. - Legend Biotech's CAR-T product, Carvykti, achieved sales of 4.39 billion yuan in Q2 2025, outperforming major competitors [18]. Group 2: Market Dynamics - The Chinese CAR-T market has seven approved products, with Legend Biotech's sales being significantly higher than its competitors, indicating a strong market presence [3]. - The high cost of CAR-T treatments remains a barrier to market penetration in China, with most patients unable to afford the treatment priced over one million yuan [29]. - The lack of a mature commercialization path for CAR-T products in China is a common challenge faced by companies in this sector [7]. Group 3: Regulatory and Insurance Landscape - Companies are attempting to improve payment capabilities for CAR-T treatments in China, with some products undergoing dual-line applications for basic medical insurance and commercial insurance [31]. - WuXi AppTec's Regiokyuran is priced at 1.29 million yuan, making it one of the most expensive CAR-T products in the market [28]. - The ongoing efforts to include CAR-T products in insurance coverage highlight the industry's struggle to balance pricing and accessibility for patients [30][34]. Group 4: Future Outlook - Legend Biotech's CEO anticipates the company will achieve profitability by 2026, indicating a positive outlook for future financial performance [20]. - The industry is exploring innovative production methods to reduce costs, with WuXi AppTec beginning to source key raw materials from domestic suppliers [35]. - The emergence of in-body CAR-T cell preparation technology may offer new avenues for cost reduction and accessibility in the future [36][37].

Core Viewpoint - The CAR-T therapy market in China is facing challenges with high costs and limited market penetration, but there is potential for price reductions and increased insurance coverage in the future [2][16]. Group 1: Company Performance - WuXi AppTec reported a revenue of 106.3 million yuan in the first half of 2025, with sales of its CAR-T drug, Regiokyron, amounting to 81 million yuan [2]. - Legend Biotech's CAR-T drug achieved global sales of 439 million USD (approximately 3.1 billion yuan) in Q2 2025, with total sales for the first half reaching 808 million USD (approximately 5.7 billion yuan), marking a year-on-year growth of 100% [3][10]. - CStone Pharmaceuticals reported a revenue of approximately 51 million yuan in the first half of 2025, a year-on-year increase of about 703.8%, primarily driven by CAR-T products [6]. Group 2: Market Challenges - Legend Biotech has reportedly canceled its sales and marketing team in China, focusing instead on more profitable overseas markets due to underwhelming domestic sales [4]. - The high cost of CAR-T treatments remains a significant barrier to market penetration, with prices exceeding 1 million yuan per treatment, making it unaffordable for most patients in China [15][16]. - The lack of a clear commercial path for CAR-T products in China is a common challenge faced by companies in this sector [4]. Group 3: Pricing and Insurance - The pricing of CAR-T products varies, with WuXi AppTec's Regiokyron priced at 1.29 million yuan, while the lowest-priced product, CStone's Nakiokyron, is priced at 999,000 yuan [8][15]. - Efforts are being made to improve insurance coverage for CAR-T therapies, with several companies submitting applications for inclusion in basic medical insurance and commercial insurance directories [16]. - The development of commercial insurance in China is seen as a key factor in enhancing payment capabilities for CAR-T treatments, which could lead to price reductions in the next five years [16][17]. Group 4: Technological Innovations - Recent advancements in CAR-T technology, such as in vivo production methods, are gaining attention and may offer solutions to the high costs associated with traditional CAR-T therapies [18]. - The production cost of CAR-T therapies is significant, with estimates indicating that the material cost for each treatment is around 43,000 USD, highlighting the need for cost-effective production methods [17][18].

Group 1 - Pharmaceutical stocks showed strong performance today, with notable increases in share prices for companies such as Heptares Therapeutics-B (up 16.3% to HKD 14.77), Rongchang Biopharmaceutical (up 12.5% to HKD 99), and Kintor Pharmaceutical-B (up 11.92% to HKD 22.34) [1] - Upcoming major events include the World Lung Cancer Conference (WCLC) in September and the European Society for Medical Oncology (ESMO) in October, where several innovative domestic drug research results will be presented, including AK112 from Kangfang Biopharmaceutical and DB-1311 from Ying'en Biopharmaceutical [1] - Several Chinese pharmaceutical companies have announced significant patent licensing transactions since August, including Rongchang Biopharmaceutical's agreement with Santen Pharmaceutical for RC28-E injection, involving an upfront payment of CNY 250 million, potential milestone payments of up to CNY 520 million, and sales milestone payments of up to CNY 525 million [1] Group 2 - Guoyuan Securities noted that as the mid-year report season concludes, the market is shifting focus towards new directions, particularly in innovative drugs, overseas expansion, and the clearing of centralized procurement [2] - The innovative drug sector in China is entering a stage of result realization, with many research and development catalysts expected to drive growth, unaffected by trade wars, making it a key investment theme for the pharmaceutical sector in 2025 [2] - Some innovative drug stocks have seen significant price increases, and it is recommended to pay attention to those with research and development catalysts that have previously lagged in stock performance [2]

Group 1 - The Hong Kong biotechnology stocks experienced a collective decline, with notable drops in several companies [1] - WuXi AppTec (02126) saw a decrease of 12.95%, closing at 4.840 [2] - BioNTech (06952) fell by 12.53%, with a latest price of 13.750 [2] Group 2 - Other companies such as Valiant (09887) and Beihai Kangcheng (01228) also reported significant declines of 9.93% and 9.75% respectively [2] - The decline extended to companies like Saint Noble (02257) and MIRXES (02629), which dropped by 9.64% and 8.43% [2] - Overall, the biotechnology sector is facing downward pressure, impacting multiple firms [1]