Workflow
Gyre Therapeutics(GYRE) - 2025 Q2 - Quarterly Results

Executive Summary & Business Update Gyre Therapeutics reported Q2 and YTD 2025 financial results, reaffirmed guidance, announced leadership changes, and outlined strategic priorities for global expansion and pipeline advancement Key Highlights Gyre Therapeutics reported its second quarter and year-to-date 2025 financial results, reaffirming full-year revenue guidance. Significant business achievements include positive Phase 3 trial results for Hydronidone, successful commercial launches of Etorel and Contiva in the PRC, and the initiation of a Phase 1 clinical trial for F230 Key Financial Highlights (Three and Six Months Ended June 30, 2025): | Metric | Q2 2025 | YTD 2025 | | :-------------------------------- | :------ | :------- | | Net Income | $1.6 million | $5.3 million | | Revenue | $26.8 million | $48.8 million | | GAAP Basic EPS | $0.00 | $0.04 | - Reaffirmed full-year revenue guidance of $118-128 million1 - Pivotal Phase 3 trial of Hydronidone (F351) in CHB-associated liver fibrosis demonstrated statistically significant fibrosis regression after 52 weeks of treatment4 - Successfully launched Etorel (nintedanib ethanesulfonate soft capsules) in the PRC for the treatment of SSc-ILD and PF-ILD4 Leadership Transition Ping Zhang, Executive Chairman, has been appointed interim Chief Executive Officer, taking over from Dr. Han Ying, who transitioned to the role of Senior Vice President, Science, to focus on research and discovery activities - Ping Zhang, Executive Chairman, appointed interim CEO13 - Dr. Han Ying transitioned from CEO to Senior Vice President, Science, overseeing research and discovery13 CEO's Strategic Outlook Interim CEO Ping Zhang expressed commitment to strengthening Gyre's global presence and accelerating the delivery of transformative therapies, highlighting rapid progress in commercial expansion and pipeline advancement, particularly for Hydronidone and pirfenidone - Focus on strengthening Gyre's global footprint and accelerating progress toward delivering transformative therapies4 - Intends to file a New Drug Application (NDA) for Hydronidone with the NMPA in the third quarter of 20255 - Planned Phase 2 trial in the United States evaluating Hydronidone for MASH-associated liver fibrosis expected to initiate in 2H 2025, pending regulatory approval45 Business Highlights and Upcoming Milestones Gyre Therapeutics expanded its commercial portfolio with new product launches and advanced its pipeline with positive Phase 3 results for Hydronidone and new clinical trial initiations Commercial Portfolio Expansion Gyre Therapeutics expanded its commercial offerings in the PRC with the recent launches of Etorel and Contiva, which began contributing to sales, while sales of its established product, ETUARY®, saw a slight decrease compared to the prior year ETUARY® (pirfenidone) Sales ETUARY® sales experienced a slight year-over-year decrease for the second quarter of 2025 ETUARY® Sales (Three Months Ended June 30): | Year | Sales (Millions) | | :--- | :--------------- | | 2025 | $23.5 | | 2024 | $25.1 | - Sales of ETUARY® decreased by $1.6 million (6.4% YoY) for the quarter ended June 30, 20256 Etorel (nintedanib ethanesulfonate) Launch Etorel was successfully launched in the PRC in June 2025, contributing initial sales in its first partial quarter - Launched Etorel in the PRC in June 2025 for the treatment of systemic sclerosis-associated ILD and progressive fibrosing ILD6 Etorel Sales (First Partial Quarter of Launch): | Period | Sales (Millions) | | :----- | :--------------- | | Q2 2025 | $1.6 | Contiva (avatrombopag maleate) Commercialization Contiva commercialization began in the PRC in March 2025, generating initial sales for the second quarter - Initiated commercialization of Contiva in the PRC in March 2025 for thrombocytopenia in adults with chronic liver disease and immune thrombocytopenic purpura7 Contiva Sales (Q2 2025): | Period | Sales (Millions) | | :----- | :--------------- | | Q2 2025 | $1.5 | Pipeline Development Updates Gyre Therapeutics reported significant advancements across its pipeline, including positive Phase 3 results for Hydronidone in CHB-associated liver fibrosis, plans for new clinical trials for pirfenidone and Hydronidone, and progress for F573, F230, and F528 Hydronidone Hydronidone achieved positive Phase 3 trial results in CHB-associated liver fibrosis, with an NDA filing planned for Q3 2025 and a US Phase 2 trial expected in 2H 2025 - Positive results from pivotal Phase 3 trial for CHB-associated liver fibrosis in the PRC, demonstrating statistically significant regression in liver fibrosis and inflammation improvement after 52 weeks8 - Plans to submit a New Drug Application (NDA) with the NMPA in Q3 2025 based on Phase 3 results8 - Phase 2 trial in the US for MASH-associated liver fibrosis expected to start in 2H 2025, subject to regulatory feedback9 ETUARY® (Pirfenidone) Pipeline An adaptive Phase 2/3 trial for pirfenidone in radiation-induced lung injury (RILI) is planned for initiation in the PRC in 2H 2025 - Plans to initiate an adaptive Phase 2/3 trial of pirfenidone for radiation-induced lung injury (RILI) in the PRC in 2H 202510 F573 The Phase 2 clinical trial for F573 in acute/acute on-chronic liver failure (ALF/ACLF) is anticipated to conclude by the end of 2026 - Completion of the Phase 2 clinical trial for acute/acute on-chronic liver failure (ALF/ACLF) is expected by the end of 202611 F230 A Phase 1 clinical trial for F230 in pulmonary arterial hypertension (PAH) commenced in the PRC in June 2025 with the first volunteer dosed - First volunteer dosed in a Phase 1 clinical trial evaluating F230 for the treatment of pulmonary arterial hypertension (PAH) in the PRC in June 202512 F528 F528 is undergoing preclinical studies as a potential first-line therapy for COPD, with an IND application targeted for 2026 - Undergoing preclinical studies as a potential first-line therapy for chronic obstructive pulmonary disease (COPD), with an IND application planned for 202613 Corporate Updates Gyre Therapeutics announced a leadership transition, successfully completed a public offering, and increased its indirect ownership in Gyre Pharmaceuticals Key Corporate Developments Gyre Therapeutics announced a leadership change with Ping Zhang becoming interim CEO, successfully completed a public offering that generated approximately $23.0 million, and increased its indirect ownership in Gyre Pharmaceuticals to 69.7% - Ping Zhang was appointed interim CEO in August 2025, having served on Gyre's Board of Directors since January 2025 and as Executive Chairman since March 202514 - Completed an underwritten public offering in May 2025, raising approximately $23.0 million in gross proceeds14 - Increased indirect interest in Gyre Pharmaceuticals from 65.2% to 69.7% in Q3 2025 through an increased capital contribution14 Financial Results Gyre Therapeutics reported its cash position and detailed financial performance for the second quarter and year-to-date periods of 2025, highlighting revenue drivers and expense impacts Cash Position As of June 30, 2025, Gyre Therapeutics reported a robust cash position, with total cash, cash equivalents, and deposits amounting to $75.9 million, significantly boosted by net proceeds from a recent public offering Cash and Cash Equivalents (in thousands): | Metric | June 30, 2025 | December 31, 2024 | | :------------------------ | :------------ | :---------------- | | Cash and cash equivalents | $36,491 | $11,813 | | Short-term bank deposits | $17,874 | $14,858 | | Long-term certificates of deposit | $21,528 | $24,568 | | Total Liquid Assets | $75,893 | $51,239 | - The increase in cash and cash equivalents mainly includes net proceeds of approximately $21.3 million received from the May 2025 underwritten public offering15 Financial Results for the Three Months Ended June 30, 2025 For the second quarter of 2025, Gyre Therapeutics experienced a modest increase in revenue driven by new product launches, but saw a decline in net income and income from operations due to a notable rise in total operating expenses, particularly in selling and marketing and general and administrative costs Key Financials (Three Months Ended June 30, in thousands): | Metric | 2025 | 2024 | Change (YoY) | % Change (YoY) | | :-------------------------- | :----- | :----- | :----------- | :------------- | | Revenues | $26,771 | $25,225 | $1,546 | 6.1% | | Cost of Revenues | $1,151 | $770 | $381 | 49.5% | | Selling and Marketing Expense | $15,194 | $14,414 | $780 | 5.4% | | Research and Development Expense | $3,425 | $3,355 | $70 | 2.1% | | General and Administrative Expense | $4,829 | $3,424 | $1,405 | 41.0% | | Income from Operations | $2,171 | $3,194 | $(1,023) | -32.0% | | Net Income | $1,576 | $4,538 | $(2,962) | -65.3% | | Non-GAAP Adjusted Net Income | $2,932 | $3,138 | $(206) | -6.6% | - Revenue increase was primarily driven by a $1.6 million increase from Etorel's launch and a $1.5 million increase from Contiva sales, offset by a $1.5 million decline in ETUARY® sales16 - The $1.0 million decrease in income from operations was primarily driven by a $2.6 million increase in total operating expenses, partially offset by the $1.6 million increase in revenue16 Financial Results for the Six Months Ended June 30, 2025 For the first half of 2025, Gyre Therapeutics experienced a decrease in revenues, primarily due to a significant decline in ETUARY® sales, which, combined with increased operating expenses, led to substantial year-over-year decreases in both net income and income from operations Key Financials (Six Months Ended June 30, in thousands): | Metric | 2025 | 2024 | Change (YoY) | % Change (YoY) | | :-------------------------- | :----- | :----- | :----------- | :------------- | | Revenues | $48,829 | $52,397 | $(3,568) | -6.8% | | Cost of Revenues | $2,045 | $1,749 | $296 | 16.9% | | Selling and Marketing Expense | $26,035 | $26,956 | $(921) | -3.4% | | Research and Development Expense | $6,520 | $5,537 | $983 | 17.8% | | General and Administrative Expense | $9,784 | $6,822 | $2,962 | 43.4% | | Income from Operations | $4,444 | $11,265 | $(6,821) | -60.6% | | Net Income | $5,310 | $14,473 | $(9,163) | -63.3% | | Non-GAAP Adjusted Net Income | $5,819 | $11,342 | $(5,523) | -48.7% | - Revenue decrease was primarily driven by a $6.8 million decline in ETUARY® sales, partially offset by $1.8 million from Contiva and $1.6 million from Etorel17 - The $6.9 million decrease in income from operations was primarily driven by a $3.6 million decrease in revenue and a $3.3 million increase in total operating expenses23 Full Year 2025 Financial Guidance Gyre Therapeutics reaffirmed its full-year 2025 revenue guidance, projecting growth driven by new product launches and continued sales of ETUARY® Revenue Guidance Gyre Therapeutics reaffirmed its full-year 2025 revenue guidance, projecting significant growth driven by the anticipated commercial launches of Etorel and Contiva, alongside continued sales of ETUARY® Full Year 2025 Revenue Guidance: | Metric | Range | | :----------- | :---------------- | | Total Revenue | $118 to $128 million | - Represents anticipated growth of 11.3% to 20.8% over 2024 revenue20 - Growth is primarily driven by the anticipated commercial launches of Etorel and Contiva and sales of ETUARY®20 Use of Non-GAAP Financial Measures This section explains the company's use of non-GAAP financial measures, specifically adjusted net income, to provide a clearer view of operational performance Adjusted Net Income Definition and Purpose Gyre Therapeutics utilizes 'adjusted net income' as a non-GAAP financial measure to provide investors with additional insights into its operational performance, by excluding specific items such as changes in the fair value of warrants, stock-based compensation, and provision for income taxes - Adjusted net income is a non-GAAP financial measure used to supplement GAAP results22 - It excludes gain from change in fair value of warrants, stock-based compensation, and provision for income taxes22 - Management believes it provides useful information for evaluating the company's performance and valuation22 About the Company This section provides an overview of Gyre Therapeutics and its PRC subsidiary, Gyre Pharmaceuticals, detailing their respective focuses and key products About Gyre Pharmaceuticals (PRC Subsidiary) Gyre Pharmaceuticals, a commercial-stage biopharmaceutical company in the PRC, is dedicated to innovative drugs for organ fibrosis. Its flagship product, ETUARY®, holds a prominent market share, and its pipeline includes Hydronidone, which has received Breakthrough Therapy designation and is nearing NDA filing - ETUARY® (pirfenidone capsule) was the first approved treatment for IPF in the PRC in 2011, with 2024 net sales of $105.0 million24 - Hydronidone received Breakthrough Therapy designation by the NMPA Center for Drug Evaluation in March 2021, with NDA filing expected in Q3 202524 - Gyre Therapeutics increased its indirect interest in Gyre Pharmaceuticals from 65.2% to 69.7% in Q3 202524 About Gyre Therapeutics (Parent Company) Headquartered in San Diego, CA, Gyre Therapeutics primarily focuses on the development and commercialization of Hydronidone for liver fibrosis, including MASH, in the United States, while also advancing a broad pipeline in the PRC through its indirect controlling interest in Gyre Pharmaceuticals - Primarily focused on the development and commercialization of Hydronidone for liver fibrosis, including MASH, in the United States25 - Strategy builds on experience in mechanistic studies using MASH rodent models and clinical studies in CHB-induced liver fibrosis25 - Advancing a broad pipeline in the PRC through its indirect controlling interest in Gyre Pharmaceuticals25 Forward-Looking Statements This section provides a standard disclaimer regarding forward-looking statements, outlining inherent risks and uncertainties without obligation for future updates Disclaimer and Associated Risks This section contains standard forward-looking statements that are subject to substantial risks and uncertainties, including those related to clinical development, regulatory approvals, market competition, economic conditions, and the sufficiency of capital resources. The company disclaims any obligation to update these statements - Statements are subject to substantial risks and uncertainties, based on estimates and assumptions26 - Risks include Gyre's ability to execute clinical development strategies, unpredictability of clinical trial results, timing/likelihood of regulatory filings and approvals, competition, economic conditions, and capital resources26 - Gyre expressly disclaims any obligation to update any forward-looking statements except as required by law27 Condensed Consolidated Financial Statements (Unaudited) This section presents the unaudited condensed consolidated financial statements, including statements of operations, balance sheets, and reconciliation of GAAP to non-GAAP measures Condensed Consolidated Statements of Operations This statement provides the unaudited consolidated financial performance for the three and six months ended June 30, 2025, and 2024, detailing revenues, operating expenses, income from operations, and net income attributable to common stockholders Condensed Consolidated Statements of Operations (in thousands, except per share amounts): | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Revenues | $26,771 | $25,225 | $48,829 | $52,397 | | Total operating expenses | $24,600 | $22,031 | $44,385 | $41,132 | | Income from operations | $2,171 | $3,194 | $4,444 | $11,265 | | Net income | $1,576 | $4,538 | $5,310 | $14,473 | | Net income attributable to common stockholders | $442 | $3,528 | $3,140 | $11,060 | | Basic EPS | $0.00 | $0.04 | $0.04 | $0.13 | | Diluted EPS | $0.00 | $0.01 | $0.01 | $0.04 | Condensed Consolidated Balance Sheets This statement presents the unaudited consolidated financial position of Gyre Therapeutics as of June 30, 2025, and December 31, 2024, detailing assets, liabilities, and stockholders' equity Condensed Consolidated Balance Sheets (in thousands): | Metric | June 30, 2025 | December 31, 2024 | | :-------------------------------- | :------------ | :---------------- | | Total current assets | $91,285 | $64,786 | | Total assets | $152,646 | $125,406 | | Total current liabilities | $16,920 | $19,516 | | Total liabilities | $23,203 | $27,004 | | Total Gyre stockholders' equity | $92,026 | $63,319 | | Total equity | $129,443 | $98,402 | Reconciliation of GAAP to Non-GAAP Financial Measures This section provides a reconciliation of GAAP net income to non-GAAP adjusted net income for the three and six months ended June 30, 2025, and 2024, detailing the specific adjustments made for warrant liability, stock-based compensation, and income taxes Reconciliation of GAAP to Non-GAAP Financial Measures (in thousands): | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2025 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net income | $1,576 | $4,538 | $5,310 | $14,473 | | Gain from change in fair value of warrant liability | $(212) | $(2,913) | $(2,467) | $(7,201) | | Stock-based compensation | $906 | $16 | $1,413 | $27 | | Provision for income taxes | $662 | $1,497 | $1,563 | $4,043 | | Non-GAAP adjusted net income | $2,932 | $3,138 | $5,819 | $11,342 |