Company code: 688266 Company abbreviation: Zelgen Pharmaceutical

Suzhou Zelgen Biopharmaceutical Co., Ltd

Summary of the 2024 Annual Report

Section 1 Important Notice

1. The summary of this annual report is from the full text of the annual report, in order to fully understand the company's operating results, financial status and future development plan, investors should go to the www.sse.com.cn website to read the full text of the annual report carefully.

2. Major risk warning

The Company has elaborated in this report on the various risks that the Company may face in the course of its operations and the countermeasures, please refer to Section 3 "Management Discussion and Analysis" of the Company's 2024 Annual Report, "IV. Risk Factors".

3. The Board of Directors, the Board of Supervisors, the directors, supervisors and senior management of the Company guarantee the authenticity, accuracy and completeness of the contents of the annual report, and that there are no false records, misleading statements or material omissions, and bear individual and joint legal liabilities.

4. All directors of the company attend the meeting of the board of directors.

5. ShineWing Certified Public Accountants (Special General Partnership) issued a standard unqualified audit report for the Company.

6. The company is not profitable and has not yet achieved profitability at the time of listing

√ Yes □ No

As of December 31, 2024, the Company's Donafenib Tosylate Tablets are for the treatment of advanced liver cancer and advanced, locally advanced or metastatic

Radioactive iodine-refractory differentiated thyroid cancer has been included in the medical insurance catalog, and recombinant human thrombin has been approved for marketing. Because donafenib tablets still need to continue to invest in team expansion and market expansion, recombinant human thrombin has been approved for a short time and is still in the market access stage, and other products are still in the marketing application or R&D stage and require large R&D investment, the company has not yet made a profit and has accumulated uncovered losses.

In the future, the company will have accumulated uncovered losses and may continue to lose money, and will face the following potential risks: many of the company's products are still in the research and development stage, research and development expenditures are large, although the company has drugs approved for commercial sales, but sales revenue may not be able to make up for the loss, the company may not be able to make a profit or profit distribution in a certain period of time in the future. The amount of the Company's future net loss will depend on the success of the commercialization of the Company's drugs, the number of drug research and development projects and related inputs, the costs associated with such projects, the cost of commercial production of approved products, and the Company's ability to generate revenue. If the Company's subsequent drug candidates fail to complete clinical trials or obtain regulatory approvals, fail to obtain market acceptance, or are not commercialized as expected, the Company may still not be profitable; Even if the company can be profitable for some period of time in the future, it may not be able to maintain continuous profitability due to the continuous investment in R&D and commercialization of new drug research and development projects. The company's inability to pay cash dividends in the short term will adversely affect shareholders' investment income to a certain extent.

As of the end of the reporting period, the company's working capital is still mostly dependent on external financing, and if the expenditure required for business development exceeds the available external financing, it will put pressure on the company's financial position, which will affect the company's product development and the commercialization progress of drugs under development.

Affecting the construction of the company's R&D and production facilities, the introduction of future talents and the stability of the existing team may lead the company to abandon drug research and development with greater commercial potential, which is not conducive to the commercialization process of the company's drug candidates.

7. The profit distribution plan or the plan for the conversion of provident fund into share capital for the reporting period approved by the board of directors

The company's profit distribution plan for 2024 is: no cash dividends, no bonus shares, and no capital reserve to increase share capital. The above profit distribution plan has been deliberated and approved by the 18th meeting of the second board of directors of the company, and still needs to be reviewed and approved by the company's 2024 annual general meeting of shareholders.

8. Whether there are special arrangements for corporate governance and other important matters

□ Applicable √ Not applicable

Section 2 Basic information of the company

1. Company profile

1.1 Company Shares

√ Applicable □ Not applicable

Company stock profile

Stock Type Stock Listed Exchange and Sector Stock Abbreviation Stock Code Stock Abbreviation Before the Change

A-shares, Shanghai Stock Exchange's Science and Technology Innovation Board, Zelgen Pharmaceutical, 688266 Not applicable

1.2 Brief description of the Company's Depositary Receipts

□ Applicable √ Not applicable

1.3 Contacts and Contact Details

Secretary of the Board of Directors and Representative of Securities Affairs

Name: Gao Qingping, Ma Weihao

Address: No. 262, Chenfeng Road, Yushan Town, Kunshan City, Jiangsu Province No. 262, Chenfeng Road, Yushan Town, Kunshan City, Jiangsu Province

Tel: 0512-57011882 0512-57011882

Fax: 0512-57018306 0512-57018306

E-mail zelgen01@zelgen.com zelgen01@zelgen.com

2. Brief introduction of the company's main business during the reporting period

2.1 Main business, main products or services

Zelgen Pharmaceuticals is an innovative pharmaceutical company focusing on multiple therapeutic areas such as oncology, hemorrhage and blood diseases, and immune and inflammatory diseases. In order to further enrich the company's product pipeline, the company continues to promote new product or indication research projects. As of the disclosure date of this report, the company's listed and major drug pipelines are shown in the figure below:

The following is the progress of major drug candidates that have been marketed or are in the clinical stage:

(1) Donafenib tosylate tablets

Donafenib tablets were approved for the first-line treatment of patients with advanced hepatocellular carcinoma in June 2021 and in August 2022

Patients with advanced, locally advanced, or metastatic radioiodine-refractory differentiated thyroid cancer; Both indications have been included in the National Catalogue of Drugs for Basic Medical Insurance, Work-related Injury Insurance and Maternity Insurance (2023).

Donafenib tablets have been included in the guidelines/consensus of 26 areas of liver cancer and thyroid cancer treatment as a first-level recommendation: "Guidelines for the Diagnosis and Treatment of Primary Liver Cancer of the National Health Commission (2024 Edition)", "Guidelines for the Diagnosis and Treatment of Primary Liver Cancer of the Chinese Society of Clinical Oncology (CSCO) (2024)", "Clinical Practice Guidelines for the Treatment of Transarterial Chemoembolization (TACE) for Hepatocellular Carcinoma in China (2023 Edition)", "Guidelines for the Diagnosis and Treatment of Integrated Oncology in China (CACA Guidelines)", "Guidelines for the Diagnosis and Treatment of Hepatocellular Carcinoma Combined with Portal Vein Cancer Thrombosis in China", " Chinese Guidelines for Radiotherapy for Primary Hepatocellular Carcinoma (2020 Edition)", "Chinese Guidelines for the Diagnosis and Treatment of Hepatocellular Carcinoma Complicated with Cholangiocarcinoma Thrombosis (2024 Edition)", "Chinese Clinical Practice Guidelines for the Diagnosis and Treatment of Biliary Tract Malignant Tumors (English Edition)", "Chinese Expert Consensus on Postoperative Adjuvant Therapy for Liver Cancer (2023 Edition)", "Chinese Expert Consensus on Targeted Immunity Combined with Local Therapy for Intermediate and Advanced Hepatocellular Carcinoma", "Chinese Expert Consensus on Transformation and Perioperative Treatment of Primary Hepatocellular Carcinoma (2024 Edition)", "Expert Consensus on the Whole Process Management of Hepatocellular Carcinoma", "Expert Consensus on the Whole Process Management of Hepatocellular Carcinoma", "Expert Consensus on the Whole Process Management of Hepatocellular Carcinoma", "Expert Consensus on the Whole Process Management of Hepatocellular Carcinoma", "Expert Consensus on the Whole Process Management of Hepatocellular Carcinoma", "Expert Consensus on the Whole Process Management of Hepatocellular Carcinoma", "Expert Consensus on the Whole Process Management of Hepatocellular Carcinoma", "Expert Consensus on the Whole Process Management of Hepatocellular Carcinoma", "Expert Consensus on the Whole Process Management of Hepatocellular Carcinoma", "Expert Consensus on the Whole Process Management of Hepatocellular Chinese Expert Consensus on Perioperative Management of Hepatic Resection for Liver Cancer (2021 Edition)", "Chinese Expert Consensus on Neoadjuvant Therapy for Liver Cancer (2023 Edition)", "Chinese Expert Consensus on Multidisciplinary Comprehensive Treatment of Liver Cancer", "Expert Consensus on Targeted Therapy for Liver Cancer", "Chinese Expert Consensus on Clinical Application of Molecular Targeted Drugs for Hepatocellular Carcinoma", "Expert Consensus on Fine Diagnosis and Treatment Management of Advanced Primary Hepatocellular Cancer", "Chinese Expert Consensus on Transarterial Intramedication and Combination Therapy for Primary Hepatocellular Carcinoma", "Chinese Expert Consensus on Intraarterial Drugs and Combination Drugs for Primary Hepatocellular Carcinoma", "Chinese Expert Consensus on Intraarterial Drugs and Combination Drugs" Guidelines for the Diagnosis, Treatment and Management of Radioactive Iodine-Refractory Differentiated Thyroid Cancer (2024 Edition), Chinese Expert Consensus on Neoadjuvant Therapy for Locally Advanced Thyroid Cancer (2023 Edition), Expert Consensus on the Management of Adverse Reactions of Targeted Drugs for Advanced Thyroid Cancer (2023 Edition), Guidelines for the Clinical Application of Novel Antineoplastic Drugs (2022 Edition), Expert Consensus on the Clinical Application of Donafenib in the Treatment of Hepatocellular Carcinoma, Multidisciplinary Chinese Expert Consensus on Immunotherapy for Hepatocellular Carcinoma (2023 Edition) and Guidelines for the diagnosis and treatment of hepatocellular carcinoma complicated with cholangiocarcinoma thrombosis in China (2024 Edition), etc.

Since the launch of donafenib tablets, it has been further confirmed that it is a targeted new drug with definite efficacy, good safety, patient accessibility and good risk-benefit balance for the treatment of liver cancer, thyroid cancer and other tumors.

(2) Recombinant human thrombin

Recombinant human thrombin has been marketed and included in the National Basic Medical Insurance, Work-related Injury Insurance and Maternity Insurance Drug Catalogue (2024), which is currently the only recombinant human thrombin produced by recombinant gene technology in China. Thrombin is an important topical application

Hemostatic drugs. According to the Notice on Printing and Distributing the National List of Shortage Drugs issued by the National Health Commission on December 20, 2020

Zhengfa [2020] No. 25)), thrombin belongs to the varieties in the "National Key Monitoring List of Clinically Necessary Drugs Prone to Shortage".

In 2024, well-known experts in the field of hematology and surgery in China will take the lead in compiling and publishing the Guidelines for the Clinical Application of Recombinant Human Thrombin with reference to relevant research and clinical practice at home and abroad, aiming to provide clinicians with accurate medication reference to ensure the safe and effective application of the drug.

(3) Jicaxitinib hydrochloride tablets

Jickixitinib is a novel JAK and ACVR1 dual inhibitor class of drugs, which belongs to the small molecule class 1 new drug. Jicarcitinib pairs

Janus kinases, including JAK1, JAK2, JAK3, and TYK2, have significant inhibitory effects, and inhibit both JAK2 and TYK2

The strongest. In addition, guicarcitinib can also reduce hepcidin transcription, improve iron metabolism imbalance, increase hemoglobin, reduce the incidence of anemia and reduce transfusion dependence in patients with myelofibrosis by inhibiting activin receptor 1 (ACVR1) activity. Jicarcitinib is the first domestic JAK inhibitor innovative drug to be submitted for NDA for the treatment of myelofibrosis and is currently in the pre-marketing review and approval stage.

As a first-level recommendation, jicarxitinib has been included in the Chinese Society of Clinical Oncology (CSCO) Guidelines for the Diagnosis and Treatment of Hematological Malignancies 2024 for the treatment of myelofibrosis.

Phase III clinical trials of jicaxitinib tablets in multiple indications for immunoinflammatory diseases, including: III for severe alopecia areata

The phase II main clinical trial reached the primary efficacy endpoint and reached statistical significance; Phase II clinical trial results for moderate-to-severe atopic dermatitis and ankylosing spondylitis indications have shown significant efficacy and a favorable safety profile, and Phase III clinical trials are currently underway. The results of the Phase II clinical study of jicarcitinib tablets in the treatment of idiopathic pulmonary fibrosis showed that the two dose groups (50mg Bid and 75mg Bid) of jicarcitinib tablets at 24 weeks could significantly delay the decline in subject's forced vital capacity (FVC) compared with the placebo group, and this trial is also the world's first phase II clinical study of JAK inhibitors completed in patients with idiopathic pulmonary fibrosis.

Based on JAK inhibitors, they have shown to overcome resistance to tumor immunotherapy drugs such as anti-PD-(L)1 in preclinical and early clinical studies

or synergistic effect, the company is also actively exploring the use of jicarcitinib in combination with ZG005 for advanced non-small cell lung cancer and non-Hodgkin lymphoma that have failed standard therapy (including PD-(L)1 monotherapy or combination therapy, and find treatment options for unmet clinical needs.

(4) Recombinant human thyroid-stimulating hormone (rhTSH) for injection

Recombinant human thyroid-stimulating hormone for injection (rhTSH) is in the NDR stage, and as of the disclosure date of this report, clinical verification and two-in-one examination have been completed. There is no approved rhTSH for use as a diagnostic drug for radioiodine (131I) whole-body imaging and serum thyroglobulin (Tg) monitoring in the follow-up of patients with differentiated thyroid cancer in China. The production technology of rhTSH is complex and the technical barriers are high. At the same time, the company is conducting a phase III clinical study of rhTSH for adjuvant radioiodine nail therapy after surgery for differentiated thyroid cancer.

(5) 8 new drugs under development in Phase I/II clinical trials

ZG005 for injection is a recombinant humanized anti-PD-1/TIGIT bispecific antibody independently developed by the company for therapeutic purposes

Clinical trials for patients with solid tumors have been approved by the NMPA and FDA. According to public inquiries, ZG005 is the first in the world to enter clinical studies

One of the drugs with the same target, there is currently no drug with the same mechanism approved for marketing in the world. Early clinical data of ZG005 for injection

It has been presented at the 2024 American Society of Clinical Oncology (ASCO) Annual Meeting, the 27th Chinese Congress of Clinical Oncology and the 2024 CSCO Academic Conference

Announced at the Annual Meeting. The company is actively advancing multiple Phase I/II and II clinical studies of ZG005 for injection as a single agent or in combination for the treatment of solid tumors such as liver cancer, cervical cancer, and neuroendocrine cancer.

The company has obtained multiple clinical trial approvals for the combination of ZG005 for injection, including: 1) ZG005 in combination with bevacizumab control

sintilimab combined with bevacizumab for first-line treatment of advanced hepatocellular carcinoma; 2) ZG005 in combination with ZGGS18 for advanced solid tumors such as advanced cervical cancer, hepatocellular carcinoma and neuroendocrine carcinoma; 3) ZG005 in combination with jicarcitinib for the treatment of advanced solid tumors; 4) ZG005 in combination with jeckixitinib for the treatment of relapsed or refractory lymphoma; 5) ZG005 in combination with platinum-containing chemotherapy regimen for the treatment of advanced biliary tract cancer; 6) ZG005 in combination with chemotherapy for the treatment of gastrointestinal tumors.

ZG006 for injection is the world's first trispecific antibody (CD3/DLL3/DLL3) against DLL3-expressing tumors, making it the world's first antibody

First-in-Class molecular form with the potential to become a best-in-class molecule. ZG006

Bridging tumor cells and T cells, bringing T cells closer to tumor cells, thereby using T cells to specifically kill tumor cells, which can be used for treatment

The IND application for the treatment of advanced solid tumors has been approved by the NMPA and FDA, and the FDA has granted orphan drug designation. company in 2024

The European Society for Medical Oncology (ESMO) and the 27th Chinese Congress of Clinical Oncology and the 2024 CSCO Annual Meeting announced ZG006

Early clinical data. The company is actively advancing the phase I/II and phase II clinical studies of ZG006 for injection in the treatment of small cell lung cancer and neuroendocrine carcinoma.

ZGGS18 for injection is a recombinant humanized anti-VEGF/TGF-β bifunctional antibody fusion protein for the treatment of advanced entities

The IND application has been approved by the NMPA and FDA, and the Phase I dose escalation in China has been completed, with a Phase I/II clinical trial

Ongoing. At the 2024 American Society of Clinical Oncology (ASCO) Annual Meeting, the clinical data and latest progress of ZGGS18 were presented, which showed good tolerability and safety as well as anti-tumor efficacy, supporting further clinical studies of ZGGS18 in advanced tumors.

ZGGS15 for injection is a humanized anti-LAG-3 and TIGIT bispecific antibody that is an innovative immunotherapy oncology biologic

The IND application for the treatment of advanced solid tumors has been approved by the NMPA and FDA, and its Phase I dose escalation in China has begun

Completed, Phase I/II clinical trial is underway. ZGGS15 has completed phase I ramp-up with good safety; At the same time, it also shows signs of efficacy; The company will actively explore its clinical application options.

Jicaxitinib hydrochloride cream is a small molecule inhibitor of topical JAK kinase independently developed by the company, which belongs to class 1 innovative drugs

Clinical trials conducted include mild-to-moderate alopecia areata (topical) and mild-to-moderate atopic dermatitis (topical).

ZG2001 tablets can highly selectively inhibit SOS1 and block the activity of a variety of KRAS mutants, thus having the ability to treat a variety of KRAS

Possibility of mutant solid tumors. The clinical trial of ZG2001 for the treatment of pan-KRAS-mutant tumors has been approved by the NMPA and FDA

Phase I/II clinical trials are underway in China.

ZG0895 for injection is a novel highly active and selective Toll-like receptor 8 (TLR8) stimulant independently developed by the company

The kinetic, which belongs to the class 1 small molecule new drug, is indicated for advanced solid tumors. In addition, TLR8 agonists are also expected to be used in antiviral therapies such as anti-hepatitis B virus infection because TLR8 agonists can activate the body's innate immune system. ZG0895 is indicated for the treatment of solid tumors

The patient's clinical trial has been approved by the NMPA and FDA, and a Phase I/II clinical trial is underway in China.

ZG19018 tablets are a KRASG12C-selective covalent inhibitor that belongs to the category 1 innovative drugs. ZG19018 tablets are for therapeutic cartridges

Clinical trials of advanced solid tumors with KRASG12C mutations have been approved by the NMPA and FDA, and phase I dose climbs have been completed

Poe Research, whose Phase I/II clinical trial is underway in China.

2.2 Main business model

The company has an independent and complete R&D and procurement system, has production facilities that meet GMP requirements, and has established a professional sales team with solid clinical promotion experience and rich marketing experience. The company conducts business activities independently according to its own situation, market rules and operating mechanisms.

1. R&D mode

The new drug R&D process can be divided into stages such as drug discovery, drug CMC research, preclinical research, clinical research, new drug marketing application, approval for marketing and post-marketing research. The company has three new drug R&D centers in Kunshan, Jiangsu, Zhangjiang, Shanghai and California, USA, which are engaged in the research and development of new biological drugs, new chemical drugs and innovative antibodies, respectively. The company's new drug research and development work adopts a combination of in-house R&D and outsourcing services.

Before a new drug can be officially marketed, the company needs to establish a production process, quality control standards, and GMP production management system that are consistent with future commercial production, and be inspected and approved by regulatory agencies on site.

2. Procurement mode

According to the research plan of the company's various projects and the work plan of relevant departments, the main content of procurement includes APIs, pharmaceutical excipients, culture media, chromatography media, packaging materials, various experimental consumables and reagents, instruments and equipment, fixed assets, outsourcing services, etc.

The company has formulated a complete set of procurement-related standardized operating procedures, including "Procurement Standard Operating Procedures", "Supplier Management Standard Operating Procedures", "Material Acceptance Standard Operating Procedures", "Business Outsourcing Management Measures", etc., to standardize the management of procurement and business outsourcing management. For the procurement of materials and outsourcing business, including procurement plan proposal, procurement plan review, budget management, supplier selection, supplier management, contract management, process control, material/outsourcing business acceptance, acceptance management, inventory management, quality monitoring and tracking management, financial supervision and performance appraisal, etc., the relevant work content is operated according to the process, so as to strictly control procurement costs and improve procurement efficiency.

3. Production mode

The company has two production plants (4 production workshops), all of which have been built in accordance with GMP standards and obtained the "Pharmaceutical Production License".

It can meet the current needs of the company's commercial production and clinical trial drug production, and has the production line and corresponding production capacity for the production of tablets and capsules of chemical drugs and recombinant protein drug stock solutions and preparations, including: oral solid dosage workshop 1 (for commercial production of donafenib tablets) and oral solid dosage workshop 2 (intended for commercial production of jicacitinib tablets); Recombinant Protein Drug Production Workshop 1 is used for the commercial production of recombinant human thrombin, and Recombinant Protein Drug Production Workshop 2 is intended for the commercial production of recombinant human thyroid-stimulating hormone.

The company does not yet have the production facilities and production capacity of chemical APIs, and the production of chemical APIs is currently entrusted to qualified API manufacturers.

In 2024, the construction of the company's new biological drug industrialization base will be progressing smoothly, which will prepare for the commercial production of new antibody drugs.

4. Sales model

The company has established and developed a core operation team with rich experience in clinical marketing and promotion, and its main functions include sales, marketing medicine and commercial and diversification.

(1) Distribution model of donafenib tablets and jecarcitinib tablets

The company adopts a distribution model for the sale of donafenib tablets in accordance with industry practice, and the company has signed product distribution agreements with a number of distributors with GSP qualifications to sell drugs to distributors, and through the dealer network, the products are transferred and distributed to hospitals or pharmacies in their authorized areas, and finally sold to patients. Drug sales need to be distributed to medical institutions or third-party terminals through distributors with GSP qualifications, and the pharmaceutical distribution enterprises that have signed contracts with the company have the advantage of channel circulation, and their professional and large-scale logistics management system is conducive to the commercialization and expansion of the company's new drugs. The marketing of donafenib tablets is coordinated and planned by the company, and the company's own sales, marketing, medical and commercial and diversified teams with professional experience carry out sales promotion.

The marketing of jicarcitinib tablets is coordinated and planned by the company, and the company's self-built sales, marketing, medical and commercial and diversified teams with professional experience carry out sales promotion. In view of the commercialization of jicarxitinib tablets after approval, the company actively deployed in advance during the reporting period, and recruited new talents who are good at marketing, medicine and sales promotion in the field of hematology on the basis of the core backbone structure of the existing commercialization team.

(2) Exclusive sales promotion cooperation model of recombinant human thrombin

The company authorized Penglai Nuokang (a wholly-owned subsidiary of Yuanda Liaoning) as the exclusive marketing service provider for recombinant human thrombin in Greater China (Chinese mainland, Hong Kong Special Administrative Region of China, Macao Special Administrative Region of China and Taiwan of China). In the field of perioperative period and hemostasis, Yuanda Life Science has been deeply engaged for many years, and has rich experience in the admission and sales of hemostatic drugs, and strives to achieve rapid market access, promotion and coverage of products.

2.3 The situation of the industry

(1). The development stage, basic characteristics and main technical thresholds of the industry

The company's main business is the research and development, production and sales of new chemical drugs and new biological drugs. According to the classification of the National Economic Industry Classification Code (GB/4754-2017), the industry in which the company is located is the sub-category of "Pharmaceutical Manufacturing (C27)" in "C Manufacturing".

(1) Overview of the Chinese market and industry in the field where the company's product pipeline is located

1) Overview of China's oncology drug market and industry

Cancer is a major public health problem and a significant contributor to the global burden of disease, with WHO estimates in 2020 that cancer is the first or second leading cause of death before the age of 70 in most countries. According to the Global Cancer Observatory (GLOBOCAN) 2020 database, the number of deaths due to cancer worldwide is estimated to be close to 10 million per year, and China accounts for 30.15% of the global cancer-related deaths. Given the aging population, the number of cancer-related deaths is expected to continue to rise globally and in China, creating a huge public health burden. Since 2010, cancer has been one of the leading causes of death in the Chinese population

Rates, mortality and burdens are all increasing. In December 2023, the Chinese Center for Disease Control and Prevention (CDC) announced the launch of the Lancet Public Health at Lancet Public Health in

The line was published under the title "National and subnational trends in cancer burden in China, 2005-20: an."

analysis of national mortality surveillance data". The study estimates that in 2020 China

The number of cancer-related deaths was 2,397,800, an increase of 21.6% compared to 2005. Between 2005 and 2020, cancer in China

There is a gradual shift in spectrum and mortality burden towards high-income countries. In 2020, the top five causes of death among men in China were lung cancer, liver cancer, stomach cancer, and food

For tube cancer and colorectal cancer, the mortality rates were 75.05/100,000, 38.31/100,000, 27.84/100,000, 18.18/100,000, and 14.63/10, respectively

Ten thousand; The top five causes of death in women were lung cancer, liver cancer, gastric cancer, colorectal cancer, and breast cancer, with mortality rates of 33.19 per 100,000,

13.54/100,000, 13.33/100,000, 11.29/100,000, and 8.21/100,000.

According to Frost & Sullivan data, the size of China's anti-tumor drug market reached 241.6 billion yuan in 2023, from 2019 to 2023

The CAGR for the year was 7.2%. The China anti-tumor drug market is expected to reach RMB548.4 billion by 2030 and 2023

The CAGR through 2030 is 12.4%.

The main driving factors for the development of China's oncology drug market include: 1) policy support for review and approval: The Chinese government has introduced a series of favorable policies, including shortening the time for clinical trials and marketing approval of new drugs, and accelerating the launch of potential new drugs to meet urgent clinical needs; 2) Increasing number of cancer patients: The number of new cancer cases in China is increasing due to factors such as an aging population, environmental pollution, and unhealthy lifestyles. In 2023, the number of new cancer cases in China has reached 4.5 million; 3) Increased clinical need: The need for new treatments in cancer patients is huge and urgent. R&D investment in new drugs and new therapies is increasing in countries around the world, and therapies such as tumor immunotherapy antibodies, bispecific antibodies, and antibody drug conjugates have promoted the improvement of efficacy. In particular, the activity of small and medium-sized biotech pharmaceutical companies in the development of new drugs has further driven the growth of the anti-tumor drug market; 4) Medical insurance policy reform: medical insurance negotiations have shortened the marketing cycle of innovative drugs, and more anti-tumor drugs have been included in the medical insurance catalog, especially the coverage of targeted drugs has been significantly expanded; 5) Effective supplement to commercial health insurance: The first version of the Category C drug catalogue is expected to be released this year, which will provide public services for the drug coverage of commercial health insurance and support commercial health insurance to play a more important role in the multi-level medical security system.

2) Autoimmune Disease Drugs Market and Industry Overview

Driven by the growing demand for personalized treatments, the increasing number of rheumatology and immunology departments, and the increased accessibility of medicines, the market size of autoimmune diseases in China is expected to continue to grow, and given the country's large patient population and the progress of innovative therapies for autoimmune diseases, the market size of autoimmune diseases in China is expected to grow rapidly, with a market size of about 24.3 billion yuan in 2022 and increasing in 2023

to about $27 billion. Benefiting from technological breakthroughs, healthcare coverage, and growing patient demand, the market size is expected to reach $175 billion by 2030

RMB, with a CAGR of 27.2% from 2022 to 2030.

The driving forces for the development of China's autoimmune disease drug market include: 1) China's large autoimmune disease patient base and increasing diagnosis rate year by year; 2) Biologically targeted drugs and JAK inhibitors have become mainstream, with better efficacy and lower side effects than traditional chemotherapy drugs (such as glucocorticoids); 3) the demand for personalized treatment has increased, and the innovation of new therapies has accelerated; 4) an increase in the number of rheumatologists and specialists; 5) Improving access to drugs: Factors such as the progress of new medical insurance negotiations, the continuous research and development of new innovative drugs, and the increase in the average income level of Chinese residents will continue to improve the accessibility of drugs for the treatment of autoimmune diseases, thereby promoting the development of the autoimmune disease drug market.

3) Multi-target antibody drug market and industry overview

By the end of 2024, more than 16 bispecific antibody drugs have been approved for marketing worldwide, and 2 domestic independent research and development drugs have been made

Bispecific antibodies approved. In March 2024, the world's first approved EGFR/c-Met bispecific antibody, Evantizumab, was fully approved by the US FDA.

Administered in combination with carboplatin and pemetrexed for test-confirmed epidermal growth factor receptor (EGFR) exon 20 insertions

First-line treatment for adult patients with locally advanced or metastatic non-small cell lung cancer (NSCLC). May 16, 2024, Tarlatamab

Imdelltra, Inc. (trade name: Imdelltra) received accelerated approval from the U.S. FDA for the treatment of adult patients with extensive-stage small cell lung cancer (ES-SCLC) whose disease has progressed on or after platinum-based chemotherapy. The drug is currently the first and only one approved for treatment

DLL3-targeted bispecific T-cell engager therapy for aggressive lung cancer and the first T approved worldwide for the treatment of solid tumors

Cell binder (BiTE) bispecific antibody drugs. Also, on May 24, 2024, Akeso's Ivonescimab (commercial

Product name: Yidafang) was approved for marketing in China, in combination with pemetrexed and carboplatin for the treatment of EGFR tyrosine kinase inhibitors (EGFR-TKIs)

Treatment of locally advanced or metastatic non-squamous non-small cell lung cancer with EGFR mutations that have progressed after treatment. November 20, 2024, beauty

The FDA has granted accelerated approval to Ziihera (zanidatamab), a HER2 bispecific antibody, for the treatment of a test approved by the FDA

Adult patients with previously treated unresectable or metastatic biliary tract cancer (BTC) with confirmed diagnosis of HER2 positivity (IHC 3+).

In 2024, bispecific antibody sales will exceed $11 billion, an increase of 37.5% from $8 billion in 2023. Market.US

The global bispecific antibodies market is forecast to register a CAGR of 37.5% from 2024 to 2033, reaching a market size of 1,926 by 2033

billion dollars.

The driving forces for the development of China's multi-target antibody drug market include: 1) unmet clinical needs: more than 4.5 million new cancer patients per year in China, and multi-target drugs for complex and refractory tumors have shown efficacy and safety advantages; 2) Policy environment support: priority review and approval, medical insurance coverage to accelerate the launch of innovative drugs; 3) Technology-driven: R&D investment in bi/multi-specific antibody drugs is increasing, and bi/multi-specific antibodies, especially T-cell engager (BiTE) molecules, multi-target signaling pathway blocking, multi-target antibody drug conjugates and other therapies have promoted the improvement of efficacy and the increase of indications.

4) Surgery to stop bleeding

According to the 2022 China Health Statistical Yearbook, 75.738 million inpatient surgeries were performed in China in 2021. Expected in

In the future, this number will continue to grow steadily, reaching 101.103 million units in 2025 at a five-year compound annual growth rate of 9.8%.

At a compound annual growth rate of 4.9%, it will reach 128.289 million units in 2030.

With the growth of the number of surgical units in China, the market for local hemostatic drugs for surgical surgery has shown relatively stable growth. It is expected that the market for surgical topical hemostatic drugs will continue to grow in the future, reaching RMB12.35 billion and RMB16.16 billion in 2025 and 2030, respectively, with a CAGR of 11.8% and 5.5%, respectively.

(2) Global market and industry overview in the field of the company's oncology product pipeline

According to the statistical forecast of Frost & Sullivan, 2020-2025 will be the golden development period of China's bispecific antibodies, and the market size will be

With a CAGR of 309.9%, it is expected that the market size of bispecific and multispecific oncology drugs in China will grow rapidly by 2033

That's $19.9 billion.

According to IQVIA's 2024 Global Oncology R&D Trends report, oncology clinical trials still occupy the overall clinical trials

The dominant position, after an all-time high in 2021, declined in 2022 but remained stable in 2023, compared to 2017

The number of trials launched is still up 18% compared to that. This trend bodes well for continued significant developments in the field of oncology therapeutics in the coming years.

China-based companies now launch 35% of oncology trials, up from 20% five years ago and 1% in 2008.

And more than American and European companies. Over the past decade, there has been a significant increase in trials conducted by Chinese companies, highlighting the important role Chinese companies play in the development of innovative products around the world. According to a recent review published in Natrue Reviews Drug Discovery, "China's Drug Licensing Deals to the West in 2024," while small molecules and monoclonal antibodies account for 48% of transactions in 2024, they account for only 29% of total upfront payments; In contrast, multispecific monoclonal antibodies and T cell engagers (a type of multispecific monoclonal antibody) accounted for 44% of the total

transactions, which accounted for 66% of the upfront payment, indicate that international and domestic new drug development companies are increasingly focusing on the early development and clinical translation of complex biologics.

The mechanism of action of bispecific or polyclonal antibodies approved for the treatment of tumors falls into two main categories: T-cell engagation that targets activated T cells

Organic drugs (TCEs) and bispecific antibodies that bind to dual targets. The treatment of hematologic tumor-related bispecific antibodies targets CD20, CD19, BCMA and GPRC5D, and the targets of solid tumors include PD-1, VEGF, CTLA4, EGFR, c-MET, HER2, EpCAM and DLL3.

(3) Main technical thresholds

The company is developing a number of new anti-tumor multi-target antibody drugs and small molecule targeted drugs, and its market segments are anti-tumor targeted therapies and multi-specific antibody drugs.

Biopharmaceutical is a knowledge-intensive industry, and the research and development of new products is the key to the development of the industry, and the requirements for capital investment are high. The process development process of biological drugs is time-consuming, requires large investment, and has many uncertainties in clinical development, which brings relatively high difficulties and challenges. Large-scale biologics manufacturing requires high capital investment, and investment in establishing cGMP-compliant biologics manufacturing facilities is important, while large-scale biologics manufacturing requires high process technology, and the complexity of the molecular weight and structure of biomolecules increases the challenges of quality control. In addition, the laws and regulations for the large-scale production of biologics are becoming more and more stringent, especially the application of cGMP manufacturing standards and new detection technologies that are more sensitive and accurate.

In terms of R&D and technology of small molecule targeted therapy drugs, compared with the traditional generic pharmaceutical industry, it relies more heavily on technology and intellectual property rights. In the setting of development goals, small molecule targeted drugs refer to relevant research results for the research and development of initiation mechanisms and differentiation, as well as drug design, screening and optimization for undruggable targets. There are many challenges in the development of small molecule drugs, the core of which is the need to balance efficacy and druggability. In recent years, many Chinese companies have independently developed a number of small molecule targeted drugs with independent intellectual property rights that have been approved for marketing, and many drugs are in the process of research and development. As the R&D of local pharmaceutical companies in China is mainly focused on relatively mature targets, the competition is also fierce, and there are high technical and patent requirements from the drug development process of preclinical research, clinical research, post-marketing safety research and indication expansion, to the commercialization process such as scale-up and process optimization.

Anti-tumor bispecific/multi-specific antibodies are currently one of the hottest directions in the field of tumor treatment. Bi/multi-specific antibodies exhibit dual specificity by simultaneously binding to different antigens or epitopes, and they have received extensive attention in the field of tumor therapy, with four main effects: 1) redirecting specific immune effector cells to selectively destroy cancer cells; 2) target a variety of cell surface antigens, thereby improving the specificity of the target; 3) delivery of drugs into the tumor; and 4) improve therapeutic efficacy and durability by blocking both biological pathways. Among these functions, one of the most commonly used is to bring immune effector cells closer to cancer cells, thereby reducing systemic toxicity and circumventing drug resistance, and the R&D barriers to entry in this field include: 1) structural design. Antibody structure design is undoubtedly one of the difficulties in the development of bispecific antibodies. At the beginning of development, it is necessary to pay attention to how to balance and coordinate the safety and efficacy of the two targets, the dosage and cycle, and the affinity with different epitopes, etc., and patent issues also need to be considered in advance. Specific structural adjustments require follow-up clinical investigation, accumulation, and validation. 2) Technology platform. The technology platform is one of the key success factors for bispecific antibody development. At this stage, the bispecific antibody technology platforms developed have their own characteristics, and there are dozens of them, but there is still a lot of room for improvement, and it is necessary to continuously explore and optimize to develop platform technologies that have both druggability, production process feasibility and scalability. 3) Commercial production. Due to the special structure of bispecific antibodies, it is difficult to realize the structural features required for function and due to structural adjustment

Changes in molecular stability, therefore, bispecific antibodies are more difficult to industrialize than monoclonal antibodies. 4) More clinical trials are needed to explore the optimal route of administration and the optimal dose to increase the concentration of target tissues and reduce systemic side effects.

(2). Analysis of the company's position in the industry and its changes

The company is an innovative pharmaceutical company, and since its inception, it has established the strategic goal of researching and developing innovative drugs with independent intellectual property rights, which are safe, effective and affordable for patients. The company's drug development focuses on the fields of tumors, hemorrhage and blood diseases, immune and inflammatory diseases, and focuses on the research and development of best-in-class or first-in-class drugs to fill the gap in China and provide better treatment options for unmet clinical needs. At the same time, the company also lays out major diseases and rare diseases, pays attention to the broad-spectrum or specific characteristics of drugs, and pays attention to realizing the leading and accessible drugs under development, so as to form a differentiated comprehensive competitive advantage of the product pipeline.

Donafenib tablets are gradually expanding their market share, and recombinant human thrombin is currently in the market entry stage after being included in the medical insurance catalog.

The company has two independent R&D platforms, namely the R&D and industrialization platform for small molecule drugs, the R&D and industrialization platform for new complex recombinant protein biological drugs and new antibody drugs, and has made significant progress in the development of new drugs during the reporting period.

The drug under development, Jicarxitinib Hydrochloride Tablets for the treatment of myelofibrosis, is in the marketing review stage and is expected to become the first new domestic drug of JAK inhibitors for the treatment of myelofibrosis.

The indication for the diagnosis of thyroid cancer of recombinant human thyroid-stimulating hormone for injection is currently in the technical review stage, and it is expected to become the first domestic new drug approved for this indication;

Advances in the reporting period include: (1) the multicenter, randomized, double-blind, placebo parallel-controlled phase III clinical trial of jicarcitinib in the treatment of severe alopecia areata has reached the primary efficacy endpoint and reached statistical significance, making it a new domestic JAK inhibitor with leading progress in this indication; (2) Moderate to severe atopic dermatitis and ankylosing spondylitis are in phase III clinical trials.

In terms of the layout of new tumor drugs, the company focuses on the multi-level combination of tumor immunotherapy and molecular targeted therapy of tumor microenvironment, the combination of systemic and local specific anti-tumor, and the development of large molecule and small molecule combination strategies, which can ensure the company's continuous competitiveness and leading position in the field of anti-tumor drug research and development, and also provide a strong foundation for the company's future multi-dimensional strategic cooperation at home and abroad.

The company is actively developing a series of bispecific/trispecific antibodies with global leadership and competitiveness, among which ZG005, ZGGS18 and ZGGS15 have completed dose escalation and entered phase I/II clinical trials, and ZG005 has been entered into phase II clinical studies with dose optimization for multiple indications as monotherapy or in combination with other drugs, including liver cancer, cervical cancer, neuroendocrine cancer, etc.; ZG005, as a bispecific antibody acting on PD-1/TIGIT, has not yet been marketed with the same mechanism of action in the world, and its clinical development progress is at the forefront of the world. ZG006, a new trispecific antibody against CD3/DLL3/DLL3, has completed the dose escalation trial stage and is in Phase II clinical studies of advanced small cell lung cancer and neuroendocrine cancer, and its clinical development progress is at the forefront of the world, and it is expected to become a best-in-class drug.

The new anti-tumor chemical drugs under development include ZG19018 tablets, ZG2001 tablets, and ZG0895 for injection, all of which have entered phase I/II clinical trials

Segment.

At the same time, the company actively lays out the international development of products, so as to enhance the ability to participate in global competition and international cooperation. Several products such as ZG005, ZGGS18, ZGGS15, ZG006, ZG2001 have been approved by the FDA for clinical trials.

During the reporting period, the company was successively selected into the 2024 China Pharmaceutical R&D Comprehensive Strength Ranking TOP100 (ranked 44th) and 2024

Top 50 in China's Biologics R&D Strength Ranking (ranked 29th) and Top 30 in China's Small Molecule Drug Enterprise Innovation in 2023

rankings, 2024 China's Top 100 Pharmaceutical Innovation Enterprises and other lists.

The pharmaceutical industry is a highly competitive industry, and the company will focus on its main business, maintain the company's sustainable development and innovation momentum, strive to build and continue to enrich the pipeline of products under development, and vigorously promote the commercial sales of more products, so as to become a more competitive and innovative pharmaceutical company.

(3) The development and future development trend of new technologies, new industries, new forms of business and new models during the reporting period

The company focuses on the fields of tumors, hemorrhage and blood diseases, immune and inflammatory diseases, etc.

(1) The future development trend of China's oncology drug market

1) Precision cancer treatment: In order to provide precise treatment for patients of different subtypes, targeted tumor therapy has emerged and achieved rapid development, with the continuous exploration of innovative targeted drugs, precision cancer treatment will be applied to a wider range of tumor-related targets, which will become the future development trend. 2) Development of new therapeutic drugs such as immuno-oncology drugs and cell therapy: Novel therapies are a new generation of cancer treatments that are rapidly developing after traditional treatments such as surgery, radiotherapy, and chemotherapy. With the continuous increase in the number of enterprises involved in new cancer therapies around the world and the gradual increase in investment and support from various governments, new cancer treatment methods will be the future development trend. 3) Wide application of combination therapy: The efficacy of combination therapy is improved compared with that of single treatment, and good therapeutic effects have been obtained, reflecting the future development direction. Innovative pharmaceutical companies are constantly experimenting with new drugs and new combinations, which will further encourage and promote the wider application of potentially effective combinations in clinical practice. 4) Promotion of chronic disease treatment concepts and related technologies: Newer treatment modalities have prolonged the survival time and active treatment time of cancer patients. In addition, patients who are unable to receive current cancer treatments or who develop resistance to initial treatment may benefit from new treatment options and end-line therapy, resulting in longer life expectancy and improved 5-year survival rates for cancer patients. The promotion of chronic disease treatment concepts and related technologies is expected to contribute to the treatment of cancer patients. 5) Accelerated and broadened the payment coverage of innovative drugs by medical insurance and commercial insurance: medical insurance negotiations shortened the marketing cycle of innovative drugs, and more anti-tumor drugs were included in the medical insurance catalog; The first version of the Category C Drug Catalogue is expected to be released this year, which will provide public services for the drug coverage of commercial health insurance and support commercial health insurance to play a more important role in the multi-level medical security system.

(2) Future trends of the autoimmune disease drug market

1) The need for personalized treatment: For decades, a large number of patients with autoimmune diseases have suffered adverse reactions caused by drug toxicity, and the growing demand for personalized treatment options and the continuous development of drug research and development technology will promote the development of personalized drugs for the treatment of autoimmune diseases. 2) The increase in the number of rheumatology and immunology specialists: At present, due to the short establishment time of rheumatology and immunology in China, the construction of rheumatology and immunology is relatively lagging behind, and the rheumatology and immunology specialists cannot meet the needs of patients in terms of quantity and quality, and there is a large gap. Based on the Notice on the Guidelines for the Construction and Management of Rheumatology and Immunology Departments in General Hospitals (Trial) issued by the National Health Commission in October 2019, more and more Chinese hospitals have begun to set up independent rheumatology and immunology departments and expand the team of rheumatology and immunology specialists, which will greatly improve the supply of medical resources for systemic diseases and provide patients with earlier and more timely diagnosis and treatment of diseases in the future. 3) Biologically targeted drugs and JAK inhibitors have become mainstream, with better efficacy and lower side effects than traditional chemotherapy drugs (such as glucocorticoids); In addition, innovative therapies and technologies, including bispecific antibodies, B-cell clearance therapies, CAR-T, etc., are making breakthroughs; 4) Increased access to medicines: Most treatments are covered by the latest National Health Insurance List

Antibody drugs for autoimmune diseases have greatly improved the availability of such drugs. Factors such as the progress of new medical insurance negotiations, the continuous research and development of new innovative drugs, and the increase in the average income level of Chinese residents will continue to improve the availability of drugs for the treatment of autoimmune diseases, thereby promoting the development of the autoimmune disease drug market.

and (3) the future development trend of the multi-target antibody market

1) Continue to expand indications. The bispecific/trispecific antibody indications under development include liver cancer, non-small cell lung cancer, small cell lung cancer, cholangiocarcinoma, neuroendocrine carcinoma, etc., and bi/trispecific antibodies for more cancer indications will be approved for clinical trial and marketing in the future. 2) Diversification of mechanisms of action. It is one of the trends in drug development to explore new mechanisms of action of bispecific and trispecific antibodies and further improve the efficacy and safety of bispecific antibodies. With the continuous progress of protein engineering technology, the structure types of bis/trispecific antibodies are becoming more and more diverse, and the progress of these bis/trispecific antibody research can realize new mechanisms of action, which is conducive to the diversification of the mechanism of action of bis/trispecific antibody drugs. 3) Innovation of new targets and molecular forms: For tumors with high malignancy or refractory treatment and resistance to existing drugs, the development of new targets or multi-target molecular form innovation based on the mechanism of tumor genesis and progression, including T cell binder molecules, targets against tumor stromal cells, targets against different immune cell subsets, multi-target antibody-toxin drug conjugates, etc., have become an important development trend of multi-target antibody drugs.

and (4) future development trends in the field of hemostatic therapy

The surgical topical hemostatic drugs market consists of several classes of biochemical drugs. The existing local biological hemostatic drugs for surgical procedures in China are mainly thrombin, snake venom hemocoagulase and fibrin binders derived from human blood/animal blood. Thrombin is an important topical hemostatic drug. However, due to the increasing scarcity of plasma sources, potential safety risks such as residual virus or immunogenicity of plasma extraction products, and the increasing production cost of plasma extraction products, most thrombin products derived from blood biochemistry in the Chinese market have been discontinued, and there are no imported or domestic recombinant human thrombin products on the market. Recombinant human thrombin is expected to become an important product in local hemostasis drugs for surgical surgery in the future due to its rapid hemostasis and safety advantages.

3. The company's main accounting data and financial indicators

3.1 Key accounting data and financial indicators for the past 3 years

Unit: Yuan Currency: RMB

2024 2023 This year is compared to 2022

Increase/decrease (%)

Total assets 3,004,614,283.98 2,887,206,825.31 4.07 1,668,311,215.22

Attributable to listed companies 1,253,857,931.48 1,632,852,717.68 -23.21 759,118,102.66

Net worth of shareholders

Operating income 532,954,371.30 386,438,784.02 37.91 302,305,057.49

Deduction from the main business

Unrelated business revenue

and non-commercial 531,529,198.98 383,557,256.20 38.58 301,844,880.50

qualitative income after the battalion

Business income

Attributable to listed companies -137,830,775.59 -278,582,744.17 Not applicable -457,327,720.54

Net profit to shareholders

Attributable to listed companies -171,160,269.29 -348,745,151.79 Not applicable -494,365,461.61

Shareholders' deductions are non-economic

Net profit from recurring gains and losses

moistening

38,204,544.79 -232,750,649.57 N/A -370,342,567.26 arising from operating activities

Net cash flow

Weighted average net assets -9.42 -20.00 -46.31 N/A

Yield (%)

Basic earnings per share (-0.52 -1.09 N/A -1.91.)

RMB/share)

Diluted EPS (-0.52 -1.09 -1.91 N/A

RMB/share)

R&D investment accounted for 72.80 128.44 of revenue, down 55.64 164.64

Percentage of income (%) percentage points

3.2 Key accounting data by quarter in the reporting period

Unit: Yuan Currency: RMB

Q1 Q2 Q3 Q4

(January-March) (April-June) (July-September) (October-December)

Operating income 108,244,408.58 132,452,323.00 143,420,460.04 148,837,179.68

Attributable to shareholders of listed companies -39,499,383.01 -27,036,687.98 -31,366,912.30 -39,927,792.30

net profit

attributable to shareholders of listed companies

-42,502,883.55 -29,868,342.70 -32,185,592.38 -66,603,450.66

net profit after that

Cash from operating activities 89,023,867.97 23,529,195.14 -45,905,992.54 -28,442,525.78

Net traffic

Explanation of the discrepancies between the quarterly data and the data disclosed in the periodic report

□ Applicable √ Not applicable

4. Shareholders

4.1 The total number of common shareholders, the total number of preferred shareholders whose voting rights have been restored, and the total number of shareholders holding special voting shares and the top 10

shareholders

Unit: Shares

As of the end of the reporting period, the total number of ordinary shareholders (households) was 8,347

The total number of ordinary shareholders at the end of the previous month prior to the disclosure date of the annual report was 7,533

The total number of preferred shareholders whose voting rights have been restored as of the end of the reporting period (households) is not applicable

Preferred shares whose voting rights have been restored at the end of the previous month prior to the disclosure date of the annual report are not applicable

Total number of East (households)

The total number of shareholders holding special voting shares as of the end of the reporting period (households) Not applicable

Not applicable to those who held special voting shares at the end of the previous month prior to the disclosure date of the annual report

Total number of shareholders

Shareholdings of the top 10 shareholders (excluding shares lent through refinancing)

Staking, tokenizing

Possession has or frozen

Name of shareholder Increase in the number of shares held at the end of the period Proportion of restricted shareholders during the reporting period

(Full name) Reduction (%) Shares Nature of Shares

Quantity Status Quantity

ZELIN SHENG (Sheng Ze 0 49,910,527 18.85 0 None 0 Overseas natural person

Lin)

Ningbo Zeao equity investment

Management Partnership (Yes 0 16,500,600 6.23 0 No 0 Other

Partnership Only)

Lu Huiping 0 12,631,644 4.77 0 N/A 0 Natural person in China

JACKIE ZEGI SHENG 0 12,292,164 4.64 0 N/A 0 FOREIGN NATURAL PERSON

(Sheng Zeqi)

Industrial and Commercial Bank of China shares

Co., Ltd.-GF Multi +4,469,040 8,469,717 3.20 0 None 0 Other

Factor flexible configuration mixing

securities investment funds

Kunshan Industrial Technology Research Institute -842,900 6,000,000 2.27 0 None 0 State-owned legal person

Research Institute LLC

Bank of China Shares Limited

Company-GF Medical Insurance +3,183,164 4,948,355 1.87 0 None 0 Other

Healthy equity securities investment

funds

Ningbo Jingchen Investment Partnership 0 3,904,740 1.48 0 None 0 Other

Enterprise (Limited Partnership)

Industrial and Commercial Bank of China shares

Ltd.-CEIB +2,214,014 3,542,429 1.34 0 None 0 Other

Therapeutic health hybrid securities

investment fund

China Construction Bank shares

Co., Ltd.-Phu Quoc Elite +2,093,839 3,315,868 1.25 0 None 0 Other

Quasi-medical flexible configuration mixing

Synthetic securities investment funds

DESCRIPTION OF THE ABOVE-MENTIONED SHAREHOLDER AFFILIATION OR CONCERTED ACTION AS OF THE END OF THE REPORTING PERIOD, ZELIN SHENG (SHENG ZELIN) AND LU HUI

Ping, Ningbo Zeao, and Ningbo Jingchen are acting in concert, and Lu Huiping is the person

He is the executive partner of Ningbo Zeao and Ningbo Jingchen; ZELIN

SHENG AND JACKIE ZEGI SHENG

Qi) is a brother-sister relationship. In addition to the above, the company has not received the above

A statement that the other shareholders are affiliated or act in concert.

Explanation of preferred shareholders whose voting rights have been restored and the number of shares held is not applicable

Holders of depositary receipts

□ Applicable √ Not applicable

The top 10 shareholders in terms of the number of voting rights as of the end of the reporting period

□ Applicable √ Not applicable

4.2 Block diagram of the property rights and control relationship between the company and the controlling shareholder

√ Applicable □ Not applicable

Note: After the resolution of all partners of Kunshan Jingao, it was unanimously agreed to change the general partner and executive partner to Mr. Lu Binhua;

IN JANUARY 2025, KUNSHAN JINGAO COMPLETED THE INDUSTRIAL AND COMMERCIAL CHANGE REGISTRATION PROCEDURES, AND MR. ZELIN SHENG IS NO LONGER KUNSHAN JING

General Partner and Managing Partner of Austria. THE AFORESAID CHANGES DID NOT RESULT IN A CHANGE IN THE CONTROLLING SHAREHOLDER OF THE COMPANY, AND HE IS STILL MR. ZELIN SHENG.

4.3 Block diagram of the property rights and control relationship between the company and the actual controller

√ Applicable □ Not applicable

Note: After the resolution of all partners of Ningbo Zeao, it was unanimously agreed to change the general partner and executive partner to Ms. Gao Qingping;

In February 2025, Ningbo Jingchen completed the industrial and commercial change registration procedures, and Ms. Lu Huiping ceased to be the general partner and executive partner of Ningbo Zeao and Ningbo Jingchen. THE AFORESAID CHANGES DID NOT RESULT IN A CHANGE IN THE ACTUAL CONTROLLER OF THE COMPANY, WHICH IS STILL MR. ZELIN SHENG AND MS. LU HUIPING.

4.4 The total number of preferred shareholders and the top 10 shareholders of the company at the end of the reporting period

□ Applicable √ Not applicable

5. Corporate bonds

□ Applicable √ Not applicable

Section 3: Important Matters

1. The company shall, in accordance with the principle of materiality, disclose the major changes in the company's operation during the reporting period, as well as the events that have a significant impact on the company's operation during the reporting period and are expected to have a significant impact in the future.

1. During the reporting period, the commercialization and promotion of donafenib tablets continued to advance, the drug access to hospitals and sales volume increased steadily, and recombinant human thrombin carried out early market expansion and commercial layout accordingly, and was included in the national medical insurance drug list at the end of 2024. During the reporting period, the company achieved operating income of 532.9544 million yuan, an increase of 37.91% over the previous year.

2. During the reporting period, the company made efforts to increase drug sales revenue, while further strengthening budget management, focusing on efficient operation, and the total operating cost decreased year-on-year. During the reporting period, the net profit attributable to shareholders of the listed company was -137.8308 million yuan, and the loss decreased by 140.752 million yuan year-on-year; the net profit attributable to shareholders of the listed company after deducting non-recurring gains and losses was -171.1603 million yuan, a year-on-year decrease of 177.5849 million yuan; The weighted average return on equity was -9.42%, an increase of 10.58 percentage points year-on-year.

3. During the reporting period, the company focused on the development of core products, and at the same time, due to the different specific R&D stages of different new drug R&D projects, R&D expenses decreased year-on-year; The proportion of sales expenses in drug sales revenue decreased year-on-year, and the interest income from bank deposits increased year-on-year. In addition, there was no write-off expense for equity incentive assessment and a year-on-year decrease in government subsidies during the reporting period. In summary, the company's net loss before and after deducting non-recurring gains and losses in 2024 decreased year-on-year.

2. If there is a delisting risk warning or termination of listing after the disclosure of the company's annual report, the reasons for the delisting risk warning or termination of listing shall be disclosed.

□ Applicable √ Not applicable