InnoCare Pharma Limited ($9969)

Great. Good morning, and good evening, our global investors. Thank you for joining InnoCare 2025 Annual Results Earnings Call. This is Ziyi Chen, China Healthcare Analyst at Goldman Sachs. Before we kick off the session, I would like to highlight that this call strictly for clients at Goldman Sachs and InnoCare only. And this conversation is not intended for the media and is off the record. Participants will be removed from the call if they cannot be properly identified. And this call or webcast is not for the purpose of sharing or receiving nonpublic otherwise confidential information. Attendees are public and market participants who may not receive and should not request nonpublic or otherwise confidential information about issuers or securities about the markets for securities. Today, we're [indiscernible] to have the full team joining the call to discuss the 2025 results, and of course, the outlook for 2026. So joining us, including the Chairperson and CEO, Dr. Jasmine Cui; the CFO, Mr. Xin Fu; CTO; Dr. [ Seng Yang Chen ]; and also SVP of Clinical Development, Dr. [ Red Ming Cao ]; VP of Medical Research, Dr. [ Kerry Joe ]; and Head of Pharmacology and Translational Medicine, Dr. [ Jason Zhang ]; and our Director, Ms. Bonnie Yuang. So management is going to give us a prepared remarks. And after that, I'm going to convert it into a Q&A session. [Operator Instructions] So without further ado, I'm going to turn the call to the company. Jasmine, you can get started.

Sure. Thank you so much, Ziyi, and good morning, good evening, and thank you all for attending InnoCare Pharma 2025 Earnings Call. InnoCare is a commercial stage drug innovation company. Our vision to become a global pharmaceutical leader dedicated to developing and delivering innovative therapies for patients worldwide. Our drug innovation efforts focus primarily on 2 therapeutic areas with significant unmet medical needs: oncology and autoimmune diseases. Here are the key business and the financial highlights. In 2025, we achieved several important milestones, including reaching the full year breakeven milestone 2 years ahead of our expectation. Total revenue reached RMB 2.37 billion, representing 135% year-to-year growth. Product sales reached RMB 1.44 billion, up 43% over last year. Net profit reached RMB 644 million, marking the company's first year with profit. At the end of 2025, we had a strong cash position of RMB 2.8 billion, providing solid support for continued R&D investment and globalization. Additionally, our global partnership strategy continues to unlock significant value. In 2025, our total BD deal value exceeded USD 2.5 billion in October last year. We entered into a strategic collaboration with Zenas Biopharma, licensing out of partial rollout broadened rights together with 2 early-stage assets. Earlier of the year, we also partnered with Prolium to explore the potential of CD3/CD20 antibody in autoimmune diseases. This slide highlights the major R&D progress and pipeline advancements. In 2025, multiple drugs and indications received the regulatory approvals, and both our oncology and autoimmune pipeline continued to expand. Orelabrutinib was approved in China for the first-line treatment of CLL, SLL, and was included in ARDL, significantly expanding our commercial space. Our second product, tafasitamab, was approved in Mainland China for defuse large B-cell lymphoma, DLBCL, and benefiting patients with DLBCL in China.

Jasmine, sorry. Sorry to disrupt. The slides were still stay on the Page 1 and not on the presentation mode.

Sorry, let me...

Okay. We're on slide number 5.

So Ziyi?

Ziyi, can you see this page?

Yes, we can see it now.

Great. So should we go back to Page 4? So those are the important numbers. Or we can continue with Page 5?

We can continue with Page 5. And at the end of the prepared remarks, we can go back and show the Page 4 for the investors.

Great. Excellent. So I just start with Page 5. This slide highlights our major R&D progress and pipeline advancement. In last year, multiple drugs and indications received the regulatory profiles. And both our oncology and autoimmune pipeline continue to expand. And as just mentioned, orelabrutinib was approved in China for the first-line treatment of CLL, SLL and also included in NRDL, significantly expanding our commercial space from this year and go on. Our second product, tafasitamab, was approved in Mainland China for DLBCL, and so we can benefit in patients with DLBCL in China. Our third product, zurletrectinib, was approved for marketing in China in December last year. In addition, several overseas approval or regulatory submission for orelabrutinib indications, including RRMZL and MZL achieved the ingredients such as Australia and Singapore and other countries. Our first product, a novel BCL-2 inhibitor, mesutoclax, is being developed for 4 indications, a Phase III registrational trial evaluating mesutoclax combo with orelabrutinib as a fixed duration regimen for first-line CLL SLL is progressing rapidly, and we have completed patient enrollment. Another registration trial evaluates mesutoclax monotherapy BTK inhibitor-treated MZL patients. This study received breakthrough therapy destination in China, making it the only BCL2 inhibitor with this designation. [indiscernible] clinical studies in first-line AML and MDS will soon be initiated in China and in global. In 2025, orelabrutinib also made a significant progress in autoimmune diseases. Globally, the Phase III trial in TPMS SPMS are going well with [ Zenas ]. In China, the Phase III trial for ITT has been completed, and we plan to submit NDA in the first half of this year. Additionally, orelabrutinib demonstrated good Phase II results in SLE, and the Phase III trial has already been initiated. Orelabrutinib is the first and only BTK inhibitor with positive clinical results in SLE globally. Our 2 TYK2 inhibitors are both in Phase III clinical development. Soficitinib has been aggressively developed across 5 indications. The Phase III registrational trial in atopic dermatitis has completed the patient enrollment, and the Phase III trial in vitiligo has also completed patient enrollment. We are conducting global studies in PA and Phase II trials in China for CSU and cirrhosis. For ICP-488, the Phase III study in cirrhosis has completed patient enrollment. Additional indications, including CRE, [ sugars ] syndromes and et cetera, are being initiated. In [ solid ] cancer, our first ADC product, ICP-B794 is completing dose escalation in Phase I, and has already shown encouraging preliminary clinical results. Our second ADC product, ICP-B208, has submitted IND this month. This slide presents our robust and innovative pipeline from preclinic though Phase I, II, III and registrational stage, all progressing rapidly to accelerate clinical value generation. Currently, we have more than 10 Phase III registrational studies are ongoing in China and global. Over the next 2 to 3 years, multiple major products and large indications are expected to receive regulatory approvals, benefiting more patients while also delivering value to our investors. Now I'd invite our CFO, Xin Fu, to share more details about our financial and commercial performance.

Thank you, Jasmine. Hello, everyone, and thank you for joining us today. 2025 has been a transformational year for InnoCare with a strong financial delivery and meaningful strategic progress. In 2025, we achieved total revenue of RMB 2.38 billion, representing 135% year-over-year growth. This strong growth was driven by continued ramp-up of our commercial products and the meaningful contribution from BD transactions, reflecting our growing global footprint. Drug sales reached RMB 1.44 billion, with 43% year-on-year growth, demonstrating the strength of our commercial platform. Importantly, we are now entering into a new phase of growth, transitioning into a diversified multiple product portfolio, with multiple commercial and late-stage assets driving the future expansion. One of our major milestones we achieved in 2025 is the first full year profitability. Net profit reached RMB 644 million with diluted EPS of RMB 0.38. This performance reflects both the strong top line growth and well-managed spending with cost efficiency. As our revenue continues to scale, we are able to absorb the operating cost more effectively while still maintaining this planned investment in innovation and the commercialization. At the same time, we continue to invest meaningfully in our future. R&D expenses reached RMB 950 million, with 16.9% year-over-year growth. This investment is focused on advancing late-stage clinical programs and building next-generation platforms such as ADC and the molecular technologies. We also remain very strong cash balance. And at the end of 2025, our cash and related account balance is around USD 1.1 billion. Importantly, we also achieved a positive operating cash flow for the first time, which marks another key inflection point of the company. On the commercial side, we made significant progress of product diversification. With new indication and approval of orelabrutinib and the new launch of tafasitamab, we continue to strengthen our leadership in hematology oncology. We now cover 4 major indications, including CLL, MCL, MZL and DLBCL, building a stronger positioning in the field. Zurletrectinib, the next-generation TRK inhibitor, represents InnoCare's first approval therapy in the solid tumor. And our commercial platform has scaled effectively. We have a dedicated team of around 500 professionals covering more than 1,000 hospitals. So was the continued growth of the orela and the full commercialization of tafasitamab and zurletrectinib, we expect the drug sales to grow by more than 35% in 2026. In addition, globalization is becoming an increasingly important growth pillar. In 2025, we completed 2 major out-license transaction covering 4 assets, making a significant breakthrough in our globalization strategy. We entered into a landmark agreement with Zenas Biopharma for orelabrutinib and other 2 novel oral inhibitors for autoimmune diseases with a total potential deal [indiscernible] exceeding USD 2 billion. In addition, we have partnered with Prolium on the development and the commercialization of CD20/CD3 bispecific antibody, with a total deal value of around 520 million. Both deals are further strengthening our global footprint while sharing the long-term value for the asset to equity participants. So in summary, 2025 has been a defining year for InnoCare We achieved a strong revenue growth, [indiscernible] for profitability, continued pipeline advancement and a significant progress in globalization. So with that, I will hand over to [ Dr. Zhao ] for the pipeline update.

Thank you, Xin. I'm going to update on the hemo-oncology franchise. We currently have several products, including 3 that have been approved and also in the late-stage clinical development. As mentioned earlier, orelabrutinib has 4 indications that have been launched in China, and some of them have been approved or submitted for NDA filing on the global market. Additionally, we have several Phase III indications expanding in China and globally. Tafasitamab has been also approved for launch in China last year. We have a novel BCL2 inhibitor, mesutoclax, as mentioned earlier, has 4 indications and go -- and ongoing clinical research expansion in China and globally, and we will discuss in more detail in the next few slides. Tafasitamab was approved for marketing in China last year, in addition to previously approved Hong Kong, Taiwan and Macau. Tafasitamab is a potent -- is potentially the best treatment option for the DLBCL in Greater China area. Tafasitamab in combination with [ lenalidomide ] shows outstanding clinical efficacy, especially for DOR and OS. Compared to the other mechanisms, its efficacy is 3 to 4x longer because the topline combination has triple mechanisms of actions, including inhibitions of B cells, microphage and NK cells. The first batch of tafasitamab was prescribed in September last year, and we look forward to tafasitamab benefiting more patients in China. Mesutoclax is our novel BCL-2 inhibitor with many clinical advantages compared to approved BCL2 inhibitor venetoclax. Venetoclax has some clinical shortcomings, primarily due to the metabolic hotspot in this molecular design. And produce a major metabolite, [ M27 ]. Within 24 hours, the AOC of M27 is equivalent to 80% of venetoclax. M27 has no pharmacological activity, but it exhibits hematological toxicity similar to venetoclax. Both M27 and venetoclax inhibits enzymes in transporters, increasing the drug-drug interaction and posing a significant risk for combination therapies and committed medications in clinical settings. The molecular design of mesutoclax, on the other hand, effectively eliminates the metabolic hotspot, and therefore, avoids the major metabolite, resulting in a higher exposure, but reducing hematological toxicity and drug-drug interaction, thus demonstrating excellent efficacy and safety in clinical practice. As shown here, mesutoclax achieved much higher exposure than venetoclax at 125 milligrams. Mesutoclax at this clinical dose achieved 3x more exposure compared to venetoclax at 400 milligrams. So this slide shows some data from the clinical studies in the first-line CLL and BTK inhibitor treated relapsed/refractory mental cell lymphoma with monotherapy of mesutoclax or in combination with BDK inhibitors. In the study of the first line CLL, SLL treated with mesutoclax in combination with our orelabrutinib, we can see its efficacy achieved an ORR of 100%, CR rate of 57.1%. And especially the MRD negative rate is very good. We achieved 65%. It has a significant advantage compared to [ ibrutinib ] than combination -- or acalabrutinib-ven combination. In the BTK inhibitor treated relapsed reflected mental cell lymphoma patients, mesutoclax showed an ORR of 84% and a CR rate of 36%, demonstrating better efficacy compared to venetoclax or [ pirtobrutinib ], which was approved in this indication. Mesutoclax also has significant potential in the treatment of AML and MDS. For AML, we observed very good data with the composite CR rate of 85.7% for mesutoclax, which is much better than venetoclax, [indiscernible], especially with MRD negative rate of 86.7% in the responders. Not only in terms of efficacy, but the safety advantage is also obvious with an SAE rate of 20.5%, while the other BCL2 inhibitors range from 40% to over 80%. Mesutoclax observed 90 days mortality rate of 0, while the other BCL2 inhibitors has raised from 4% to 20%. So mesutoclax demonstrated huge advantage in AML treatment. MDS is another indication with a very broad market space. Venetoclax failed in the Phase III study, the [ VERONA ] study, and currently, no BCL2 inhibitors has been approved for MDS. So we are very confident in mesutoclax for the MDS indication, and the preliminary data will be released at ASCO this year. In summary, mesutoclax has enormous market potential with a combined market space of over USD 20 billion from trading lymphoma to leukemia. And we believe mesutoclax will be a potential blockbuster asset with a market potential of tens of billions of U.S. dollars. And we will advance clinical research with the best effort to expedite its approval and market launch. With that, I'm going to transfer to [ Dr. Cary Zhou ] for autoimmune disease.

Thank you, [ Randy ]. Let's take a look at our well-positioned portfolio in autoimmune diseases. Our pipeline includes 5 clinical stage assets. Orelabrutinib has 4 indications: PPMS, SPMS, IPP and SLE, all incurred a registration Phase III or the NDA stage. ICP-332 is under development for 5 dermatology indications. It's atopic dermatitis Phase III trial has completed enrollment. ICP-488 is in the Phase III for psoriasis and other 2 indications of cutaneous lupus and Sukin syndrome are also under development. Our early assets are making a major step forward. So we won molecule glue and the interleukin-17 oral drugs have entered the clinical stage. Orelabrutinib has a big potential for treating autoimmune disease. MS is targeted for PPMS and SPMS. The 2 most challenging MS subcuts representing over 40% MS, both in Phase III stage. And the NDA submission for ITP is backed in the first half of this year. And for SLE, orelabrutinib is the world's first and only BTK inhibitor, demonstrating the efficacy in Phase II trial, and the Phase III clinical trial initiation is underway. The number of the ITP patients, we know that in China is large and the diagnosis rate has been continuously increasing. The online needs are clear. We have completed our Phase III clinical trial and will submit NDA very soon. This milestone is clearly visible. Orelabrutinib in SLE is a global first in-class BTK inhibitor with large market opportunity. We know that SLE affects about 8 million people worldwide, 1 million in China, most of them young women. Currently, treatment are associated with substantial [indiscernible] high relapse rate. So safe, effective long-term auto treatment remain urgently needed. The global SLE market already exceeded $3 billion oral server pace like orelabrutinib are poised to drive the next wave of growth. This is a Phase II clinical design for SLE. The patients on the background of standard of care were randomized to receive the orelabrutinib, 15 milligram QD, 75 milligram QD or the placebo for 48 weeks. The steroid must be tapered to the target dose equals to less than 7.5 milligram per day. The patients who did not achieve this target dose were regarded as nonresponders. The primary endpoint was SRI-4 at week 48. The results show the SRI-4 in the orelabrutinib 75 milligram QD was significantly higher than that of a placebo group, and the study reached the primary endpoint. Moreover, in this study, orelabrutinib demonstrated good tolerability and safety. Furthermore, the subgroup analysis revealed that efficacy was better in the population, with a baseline [indiscernible] 1a or 2b or the clinical score [indiscernible] more than 4. We can see that the response rate of SRI-4 was as high as 68% in orelabrutinib with 43% difference compared to the placebo. Similarly, the patients with a higher baseline euro protein or the steroid dose also showed better efficacy. Also, the more people in the orelabrutinib 75-milligram QD group achieved their target steroid dose. The percentage is 71.1% compared to only 43.6% in placebo group. This is a Phase III study design. On the basis of standard treatment, patients will be randomized to receive orelabrutinib 75-milligram QD or the placebo for 52 weeks. The primary endpoint would will be the SRI-4 at week 52. The steroid needs to taper to the target dose as well. This is our TYK2 inhibitor platform, consisting of [ 2 ] assets targeting the different domains of TYK2. We can see ICP-332 target [indiscernible] totally inhibiting the TYK2 is near [indiscernible] for the selectivity over the JAK1 and no activity against JAK2 or JAK3. This design aims to achieve significantly clinical efficacy through the synergy of the TYK2 and JAK1, while ensuring the safety. The ICP-488 [indiscernible] to the [indiscernible] highly selective for the TYK2 without inhibition for other targets. It delivers a clean TYK2 specific efficacy and safety. So our 2 molecules established a distinctive sustainable TYK2 platform with strong competitive potential. Let's look at the ICP-332 Phase II data for AD. In terms of efficacy, we can see ICP-332 achieved the best EASI-75 among many competitors. It's worth emphasizing this data was obtained only within 4 weeks, while most competitors typically require 12 to 16 weeks. In terms onset speed, we can say ICP-332 achieved significant relief for our [indiscernible] started from day 2 and demonstrating the clinical advantage of rapid itch control. This is ICP-488 Phase II data for psoriasis. We can see that efficacy is also outstanding. At top weeks, the PASI 75 of 6-milligram QD achieved 77.3%, and the 9-milligram QD achieved 78.6%, while placebo was only 11.6%. And also, the onset is granted ICP-488 showed significant improvement over placebo by week 4, rapidly improvement in the 6 week and further enhancing in 12 week, showing continuously increasing trend. In summary, ICP-332 as a dual target inhibitor blocks multiple key cytokines such as interleukin 4, interleukin 13, interleukin 31 TSLP under [ inferogama ], therefore, precising the big potential for multiple indications extension. Currently, ICP-332 has been fully advanced in 5 indications targeting the patients over hundreds of mailings. And in coming months, the Phase III primary endpoint data for atopic dermatitis, Phase II data for vitiligo and psoriasis will be read out, which is worth of high attention. In addition, these 2 trials for [indiscernible] will complete enrollment. The psoriasis as a core indication for ICP-488 Phase III is ongoing. The CLE and the [ Sjogren ] syndrome has entered a Phase II stage with high unmet medical need. Currently, no target drugs approved for these 2 indications. Other potential indications, including SLE, IBT, PSC extra, the global market opportunity exceeds USD 150 billion. In coming months, the primary end point of psoriasis Phase III will have a data readout, which is worth of high attention. So next, I would like to hand it over to our CTO, [indiscernible], for further introduction.

So with a huge market demand for autoimmune diseases, we continue to broaden our pipeline in addition to 3 Phase III molecules, orela, ICP-332 and ICP-488, we are pursuing more programs in the small molecules by our largest broad integrators will cover broader autoimmune disease indications. Next, I will introduce 2 early-stage programs, VAV1 and IL-17. VAV1 is a key protein in the T cell and B cell receptor pathway. [indiscernible] and PSMB cell preparation differentiation at the basin in the cytokine [indiscernible]. So VAV1 is thought to be a promising target for treating autoimmune diseases, including some hard-to-treat implications. We have developed ICP-538, a highly potent and selective VAV1 molecule go degrader. It is now a Phase I clinical trial as the second VAV1 degrader globally to enter clinical development. Here are some preclinical data. ICP-538 was highly potent with [indiscernible] a low single-digit [indiscernible] induced VAV1 protein degradation rapidly and deeply [indiscernible]. And the right CIA model is showed a dose-dependent efficacy and inhibiting information progression. Another program is IL-17. IL-17 Is a proven target for treating autoimmune diseases. Market drugs or all biologists approved for the treatment of psoriasis and other indications as shown in the right figure. The drug binds to IL-17 [indiscernible] is expanding to IL-17 receptor. They are blocking the IL-17 mediated senary pathways. We discovered a novel molecule ICP-054, which is a PPI inhibitor with high affinity to both IL-17 AA and AF, and has excellent PK property. It was efficacious and right CIA model and the efficacy was dose dependent. ICP-054's R&D application has been submitted. Now I'll hand over to [ Dr. Jason Zhang ].

Thanks, [indiscernible]. I will introduce our pipeline in solid tumor. So in solid tumors, our first innovative product, [ zurletrectinib ], is the less [indiscernible] track inhibitor. With approval in December 2025 for the treatment of adult and adolescent patients of solid tumor with NTRK gene fully. So the clinical efficacy data is outstanding, with an ORR of 89.1%, the longest observed KS exceeding 36 months, so which is particularly remarkable in solid tumor. In addition, zurletrectinib has demonstrated ability to overcome the resistance to first-generation TRK inhibitors in clinical. So our registrational study in pediatric patients has also been completed. We plan to submit the NDA in Q2 this year. ADC is one of the key strategic pillars of our biologics efforts in solid tumor. We have developed a differentiated ADC platform by optimizing a very critical component. We utilized an irreversible connector to prevent the nonspecific payload exchange. The hypothetic linker allows high value and improve the stability. We also employ a high potent payload that is selectively released within tumors and so strong by standard effect. Importantly, the payload has a very high clearance which helps reduce the systemic [indiscernible] by rapidly eliminating the payload from the circulation. And these differentiated features currently into a significantly wider therapeutic window. We calculated therapeutic window by comparing the [indiscernible] in GLP monkey toxicology study to the minimal efficacy dose in mouse models. So the therapeutic window of competitor is around 40-fold, whereas our B7-H3 ADP, the B794, achieved a window of [ 254-fold ], much wider than the competitor. Our leading ADC product, the B7-H3 ADC, B794 is currently in the dose [indiscernible] stage of the Phase I trial to the PK data from the first 2 dose cohort consistent with our molecule design. Following a single IV dose, the ADC polder is comparable to competitors. While the payload level in plasma are 5 to 10x lower compared to the competitor. So indicating a favorable safety profile of our ADC. Another clear advantage of our differentiated ADC platform is the superior efficacy. To compare with the common yield payloads such as DSD and [ f tecan ], our payload are more potent and less sensitive to the [indiscernible] transporters. So this results in a stronger by standard effect and the ability to overcome [indiscernible] to ADC. To compare the efficacy of different ADC platforms, we conjugated a different linker payloader from various ADC platforms to the same B7-H3 antibody and we conducted in vivo efficacy study for a head-to-head comparison. So the results show that our ADC clearly stand out and exhibits best in class efficacy. And notably, in large tumor models, our ADC demonstrated a robust tumor killing activity. While these 3 competitors, the ADC failed to inhibit the tumor growth, our ADC achieved complete tumor regression at the same dose. And importantly, our ADC also overcome the resistance to add 10-milligram per kg. The competitor for ADC failed to inhibit tumor growth in this resistant non-small cell lung cancer model. In contrast, our ADC, the B794 demonstrated potent antitumor activity in this specific model and achieved complete tumor eradication. So ongoing Phase I dose escalation study of our B7-H3 ADC in lung cancer, all the 3 patients treated at a second cohort achieved a partial response to providing the early proof of concept for our EC platform. Our second ADC target, CDH17, a highly permission target for the GI cancer. So in normal tissues, the CDH17 is hidden in the type functions and largely inaccessible. In tumor cells, however, the CDH17 is its core to make it an attractive therapeutic carding. So we target has broadened potential across many GI cancers. So we already submitted R&D for our CDH17 ADC, the B208, and in both high and low CDH17 expression models, it showed better efficacy than one of the leading competitor. And actually, the advantage is even more profound in low-expression tumors. So in a solid tumor field indicates building 3 major biologics pillars. In addition to the monospecific ADC, we are rapidly advancing multiple bispecific and more specific ADC through our innovative platform. So we plan to file more IND in 2026. Beyond ADC, we are also developing the next [indiscernible] designed to overcome the tumor microenvironment suppression and improved tumor penetration. Furthermore, our third IO therapies are designed to -- for the conditional activation within the tumor marker environment and turning the core tumor into whole tumor. And these projects aim to deliver improved ORR and eventually the OS, addressing significant unmet medical needs. So I will circle back to Jasmine to give a summary.

Sure. Thank you. This is the last page, highlighting our near-term milestones. In hematological cancer, our Phase III study of orelabrutinib combo with mesutoclax has finished patient enrollment and are now waiting for data maturation and subsequent ADA submission. We are also starting patient enrollment in the registration trial of BDK inhibitor-treated MZL, aiming to complete patient enrollment within the next few months. This year, we will also initiate the Phase III trials for first-line AML. And up on more data collection, we plan to quickly launch a Phase III registrational trial in MDS globally. In autoimmune disease, the ADA submission for orelabrutinib ITP is planned for the first half of this year. We will also accelerate the Phase III study in SLE. For soficitinib, the Phase III trial in atopic dermatitis and the Phase II trial in vitiligo will have data readout in middle of the year. The global study in TN and our Phase II trials in CSU and cirrhosis in China are progressing rapidly. For 488, the Phase III registrational trial in cirrhosis will have data readout in middle of the year as well, and additional indications such as CRE and the Shingles disease also entered into clinical development. Our first-in-class innovative therapy, ICP-538, has already entered into clinical development, and another molecule, ICP-054, has submitted R&D. In solid cancer, the NDA for zurletrectinib in pediatric patients will be submitted soon. Just mentioned, our first ADC product, B794, will achieve clinical TOC in Q2 this year. And our second product, ICP-B208, IND has been submitted. We expect to achieve first patient in and a clinical TOC this year. In our preclinical stage, we will have 5 to 7 programs expecting to file INDs this year, which is laying out a strong foundation for the company's 3.0 development stage. I stop here. Thank you all for your attention. We're happy to take any questions.

Thank you, Jasmine, and management team. Well, this is a very comprehensive go through of all the details of the company's model. Now we're going to be getting into the Q&A session. [Operator Instructions] While we are waiting for the questions, I've got a couple of questions to start with. Orelabrutinib have been achieving pretty good results in 2025. In the fourth quarter, we also see the growth has been pretty solid. But looking into 2026, how should we expecting the sales potential? And particularly now we have new indications and also for MCL, we believe company can able to deeper penetrating into the population. So where we're going to be sitting for 2026 for the commercial performance? And also this year, 2025, you're already getting to a breakeven status. Going forward, '26 and '27, how should we think about the potential margin trend and also the earnings trend? That's my first question.

Thank you for the questions, Ziyi. Actually, yes, you observe is correct. Orela actually is our core product and have very strong robust growth in 2024, 2025. We see that over 40% continued growth. So with orela trend, we think there are several drivers to -- for the performance. First of all, is that the MZL indication, we see is continue to grow as we are the first and only in class positioning in China which allowed us to capture the high unmet medical needs in China. So in 2025, we have various strong growth in the MZL. Secondly, we have deeper -- we also see deeper penetration in CLL, MCO, and we have a broader hospital cover in Tier 2 and more Tier 2 and Tier 3 cities. And then finally, we have very established the commercial execution team, including the more data-driven targeting as well as the sales force. So looking for the 2026, I think we will -- first of all, we will continue for the MZL. We are the only one -- the [indiscernible] meter will continue to grow. At the same time, I think the CLL will also accelerate because we have a first-line approval and also successfully included in the [indiscernible]. So I think the -- with the more hospital coverage efficiency of our commercial team, we're pretty much confident that the -- orela will continue to grow over 30% growth. So this is for the orela. Definitely, we are also seeing that with the tafasitamab and also zurletrectinib, we have diverse the commercial products. So in 2026, we are very confident that we have over 35% for the growth rate. In terms of your second question about the breakeven. Yes, we -- with the top line, strong growth from the commercial as well as the BD contribution, we achieved for the profitability ahead of our schedule about 2 years. So looking for the 2026 or 2027, we think the commercial will continue to grow. And also, the -- we will also have some near term, the revenue realization from the BD deal in 2026. So even without new deal, we are very confident that we will continue sustainable for the breakeven in 2026 and 2027. Actually, we have also a lot of the good pipeline and assets to have global BD opportunity that will be added to our P&L.

Great. We saw UBS Chen Chen has raised her hand. Before I continue with my questions, I'm just connecting Chen Chen in for her questions.

Well, I have 2 questions for management. First of all, on ICP-488, the TYK2 assets. In China, you are working on several indications such as psoriasis, CLE and Sjogren syndrome. So how about the development plan overseas? What indications are you considering and will rely on potential partners to carry out the trials?

Actually, for ICP-488, as you know that for psoriasis, already we've finished enrollment of Phase III, and we will have a readout this year. And we also start the development for the CLE and the Sjogren syndrome in the Phase II stage. And we are going to expand more indications after we have the readout of our Phase III, and we target huge unmet needs and maybe more severe patients. But actually, we really need to take a look of our readout. And for BP opportunity, maybe?

Yes, Chen Chen, you are right. Actually, just as [ Kerry ] said, we are going to read out the Phase III result is a large trial on cirrhosis. And we will get -- see how good the results and positioning ourselves for the global development plan. As you know, the TYK2 experiment -- as therapy inhibitor TYK2 has potential other than even autoimmune disease, and the people trying Type 1 diabetes and all different indications. Of course, we are exploring more. And so again, we want to see our Phase III result in a few months first and to make a comprehensive plan for the globalization. And of course, we are also open for partnership and with different indications about 488.

That's very clear. And my second question is on your R&D expense. I'm just wondering, can you help us understand your R&D expense trend in 2026, given that you have multiple Phase III trials in this year, such as orela SLE trial, mesutoclax MDS global Phase III. And also, you are also working on some like new technologies such as ADC and the molecular glue. So how do we forecast the R&D expense going forward?

Thank you for the question, Chen Chen. Actually, in 2025, our R&D expense is around 950 million with 17% growth. This is already including some very important Phase III study. In 2026, we will continue to invest in the late-stage clinical study as well as for the innovation platforms such as ADC molecular glue technology, TCE, et cetera. So we foresee that around for the R&D expenses will be driving our future value. So we will continue to invest in this area. Roughly around, I think, in 2026, there will be around 20% growth. We don't expect that the significant step up for R&D overall intensively. So we think around 20% of growth in 2026, unless there's other funding requirement for significant investment. So this is the -- our high-level forecast. Overall, we think we are positioning very well to fund our pipeline. We have not any near-term financing pressure.

Great. Next question coming from Jack Lin.

Can you hear me?

Yes.

Yes.

Just a quick one on 488 as well. So I think in the Phase II study that would -- on the psoriasis you previously reported, a very competitive PASI 75 data. And I think this was, I think, a year or so back in terms of the PASI 100. I think at the 12-week we had kind of around 11% or 12% -- 11% to 12%. Just curious in terms of for the upcoming data update for ADA, in terms of how where do we see -- will there be kind of breakdown to these asset levels? And where do we kind of see this trending for the PASI 100 benchmark?

Actually, in our coming data, we include all the endpoints, including PASI 75 or the PASI 100. But currently, this is a blended status. So it's difficult to see that data then and is not. So we are also looking forward that we can finish this Phase III study and do the analysis as soon as possible.

Yes. We -- the Phase II/III study is about 16 weeks. So we enrolled a lot of patients in the last 2 or 3 months. So we still need to wait maybe a month or 2 to really see the results even reaching week 16. The PASI 100 generally goes with the time and with the tight treatment, the time is longer, it goes up a lot. And so based on unblinded data now and our Phase III result looks pretty good.

Okay. Well, I think -- actually I have a follow-up question on 488. Because about 7 days ago, right, Johnson & Johnson's is IL-23, icotrokinra, has just getting approved by FDA and is believed to becoming a very interesting asset [ IL-1s ] for cirrhosis, PASI 90 getting up to 50% and it's pretty decent safety profile. So if we are looking at now, there's [ RO 1 ] which is oral peptide and that you've got a small molecule, which is TYK2 inhibitors. How should we think about in the future oral treatment for cirrhosis landscape? How you're going to be positioning the TYK2 inhibitors, all those competitions?

Thanks for your question. It's a very, very good question. Actually, we know that [indiscernible] first TYK2 launch market. Definitely, it's a panel in psoriasis. And afterwards, we see a few TYK2 inhibitor has come out with better efficacy. Like our Phase II data, we already see ICP-488 looks better than the -- comparable to the biologics. So we know that our TYK2 inhibitor actually is already approaching the biologic -- the efficacy is protein biologic levels. So they were well positioned to compete with our interleukin 23 in psoriasis. This new psoriasis area. And even [ SAP 23 ] is in a strong auction. However, we believe that the indication may be similar to the interleukin 23 biologics, which is limited to the psoriasis of the IBD-relevant indications. TYK2 inhibitors as our introduction, we know that may have a much broader potential with opportunities like SLE or CRE Sjogren's syndrome and beyond. So we think that TYK2 inhibitor oral therapy still have a big potential, have a big room to development.

Yes. So in addition to what Carrie said about psoriasis, it is a pretty busy field for psoriasis. You are right that we have biologics, IL-23. And we have just Johnson & Johnson approved oral peptide IL-23. So this is still in the very early days and also small molecule, the TYK2s. So with oral peptide, and there are a lot of mysteries. The bioavailability extremely poor, the material is extremely expensive and a lot natural amino acid unit, we don't -- still don't know the long-term treatment, how good the safety will be and how that is the cost of goods, a lot of stuff. We still think a small molecule. If the efficacy is pretty similar to that, the Phase III result after we see it, we still think it has a lot of room [indiscernible] for like allosteric inhibitor of TYK2 like our 488 compared with others. So if the efficacy is good, is it -- we still -- this is still best way and safe way for the treatment for patients. And so -- I mean we will see maybe this time next year, we want to better answer, Ziyi.

Great. We're looking forward to the data for sure. And also, we have a question on -- regarding the 248, which is BCL2. I think in the previous slides just show the UMRD data, right, and OR data, which looks pretty promising compared to [ apritinib ] plus venetoclax and also [indiscernible] plus venetoclax. But if you look at it across all different [indiscernible], particularly fixed duration regimens in this setting, first-line treatment. I have -- first, my question is regarding the orela plus mesu data, is this targeting old comer? Or is targeting fit population unfit population? Is there any limitation of inclusion criteria regarding age? So we're trying to understand about what is this data is based on? And another question is regarding if we look at all different trials -- all different regimens, probably AV or IV, the bar is not the highest, right? I think we are talking about potentially venetoclax plus [ GAZYVA ]. They house CRL17-CRL14 trials, their data looks pretty promising. And also the early data coming from [ zanubrutinib plus saron ], the data UMR getting up to 91% at week 48. So that data also looks pretty promising. So again, this is a competition question. How you're going to be positioning your BTK plus B-cell to fixed duration combination amid all those competitions?

Yes. Thank you for that question. It is a very competitive landscape in first-line CLL treatment, and we see a lot of combination therapies. We believe that the oral doublet BTK and BCL 2 inhibitor gives a very good potential in terms of convenience and delivery of a very deep remission rate. As you've seen here, our combination achieved 65% of MRD and this is in the unfit older patients that we've seen, which are more fragile and with a lot of limitations in terms of their physical conditions, and this is a very good result that we can achieve in this population. In terms of BCL2 with gazyva combination, yes, the remission rate is steeper, but it also comes with a lot of limitations with the IV infusion, with the limitations of toxicity that brought by this infusions and a lot of patients are not tolerated by this IV treatment. So with -- a lot of patients that are with their baseline conditions, the oral doublets still bring a very good potential for treating these patients. And in addition to the first-line treatment, we are also looking at patients with relapse to reflect a CLL as well. So there's still a lot of room for that population when patients are past their fixed duration treatment, there is still need for additional treatment options. So there are a lot of exploratory space for CLL as well.

Got it. Well, another question is regarding the early-stage asset, which is CDH17 ADC. I think for that -- Jasmine, I think last time, you mentioned about the B7-H3 ADC is really you're using a validated target to validate ADC technology you guys are developing, right? So that's why you're picking a B7-H3, which we're already getting some of the proved concept data across different assets. And now it demonstrated the technology, the payload linker you develop is actually pretty interesting. Particularly, you mentioned about the ex blood transporter insensitive, right? Because we know that in gastrointestinal cancers, this is highly expressed. And this is also one of the reason gastrointestinal cancers has been one of the coldest tumors across different solid tumors as we haven't had a very good efficacious treatment yet. Is that the reason -- you got the payload and the linker first, then you decided to move into a new target CDH17 for gastric cancer? Or it's actually -- if thinking reverse is you start with a CDH17 because you try to developing something for gastrointestinal cancers, then you start to developing a payload linker platform DAS specifically for the GI tumors? So what is the thinking process when you are choosing the -- or treating the target and developing this type of linker payload technology?

Right, Ziyi. Actually, what you said is true, that we developed this antibody originally because this is highly unmet medical needs in the gastric and same cancer and the different -- so that's our focus. Those are hard to treat cancers. This is what we want to work on for the solid cancer while we were developing the payload linker. And so with the very encouraging data from B7-H3, and the data looks very good, so good that we want to also develop CD70 and ADC. Since CDH17, although there are several players in the field, but in all are very early stage, not much about in Phase II yet. So in that, we are much more competitive than the B7-H3. Although B7-H3, we still see -- we are really competitive in some big indications we are pursuing. And you are right, so we have this so powerful payload and linker and demonstrated excellent efficacy in the clinic. And we are developing multiple antibodies, including the mono and majorly bispecific antibodies. This year, we said we have 5 to 7 IND submission and include those bispecific ADCs. And so within those good antibody or 2 bispecific for the antibody and together with a very powerful linker payload, that make the driver even more effective and superior. So that's the though process.

Got it. And also regarding the global clinical development of your asset, particularly for orelabrutinib immunology, that was on the hand of Zenas Biopharma and your partners for that. In January, they do face a bit of a heat cup when the trial result has been positive for the Phase III for the IgG4-RD, but the market reacted pretty negatively. So with that, is that going to potentially affecting their financing plan and also slow down the development program for orelabrutinib and also some 2 other preclinical assets?

Yes. Actually, Zenas disclosed their year-end review a few days ago. Actually, we really being -- the 3 assets, orelabrutinib and for PPMS, SPMS, they are very aggressively pursuing the clinical trials. And with IL-17, we are doing the clinical trials together. So they are not slowing down. They actually accelerated the progress, and I think those assets are really important for Zenas.

Got it. Great. Just to wrap up, Jasmine, could you help us to understand a bit more about what are the most important data readouts to be potentially presented at any of the medical conferences this year because investors are really going to be looking at those events to see how they're going to be trading on the stock.

Yes. Maybe the scientific leadership, maybe they have -- quickly come in a few sentence, but our liquid cancer field.

Yes. We submit abstracts for ASCO this year for the updated data of our mesutoclax, both in AML, MDS and also combination therapies for some lymphoma indications. And later during ASH, we're going to give more updates with these studies with longer follow-up in more populations and in addition to which has been released so far.

Yes. For immunology, actually, we submit our SLU Phase IIb data to the [indiscernible], and that meeting will be at the beginning of June. And we will have the -- currently, we are under the submission of our Phase II psoriasis data and also the one -- SLU Phase II data for the publication in the journal, but actually, it really depends on the -- the time line is really depends on whether they accept or not accept it.

So in summary, I think for liquid cancer for 248, that's our big asset. We will have ASCO data on MDS, which is very important indication and no good treatment we are pursuing first line and in both China and the global clinical trials now, we want to start the Phase III as soon as possible. So we will have that data presented at ASH. And also for 248, just to mention, we are doing the 2 registration trials going now with the combo with BTK inhibitor who will have more -- we will have more or longer data and will present at ASH and others. And also the registrational trial, like MCL, we should have the data by later of the year and the whole trial data and for the registration. For autoimmune disease and in addition to what [ Kerry ] said, the meetings, we actually have a few really big readouts this year. And the Phase III trial for atopic dermatitis and for -- and we should have the data in July, in middle of the year. And also vitiligo, which is in the new POC study for this TYK2 inhibitor. And we should have -- we already finished patient enrollment. We should have the data also by the middle of the year. And also for 488 for cirrhosis and like you all mentioned how well it is in the Phase III trial in a longer study. So we will have that data also by middle of the year. And also for these 2 assets, we started multiple indications. Even for 332, the first compound we started with cirrhosis and we are going to finish the enrollment of cirrhosis very soon. And we want to see that we will wait to target and TYK2 a little bit of JAK1, how that will be in cirrhosis. Maybe that will give us -- so we should have that result later this year as well. So for ADC and just like you said, we will have in second quarter, we will have a very comprehensive data for B7-H3, and we plan to submit it to the -- which is to the [ ISMO ] in Europe. And so we plan to submit -- we also submit the preclinical data we presented to the AACR. Actually, we have a presentation at the AACR. And also the CDH17, this ADC data, we should have a POC later this year as well. So we have many readouts. And all the 3 different areas, and they will be very busy this year to disclose the data. Although for registrational trials, the Phase III study. And since we need to interact with the CD first, we don't know how deep the data work is close. And before, we will have our major end point, but we still think ADA submission will be our first priority. And right now, we are already -- we are stating ITP data, and we will have that after the package is accepted.

Great. Jasmine, do you have any final words for the call?

Thank you for all still staying in the meeting for so late. In 2025, we achieved outstanding results. In 2026, we're also confident that our sales revenue will continue to grow rapidly, and we have multiple BD opportunities and try to complete the new partnership this year as well. And also importantly, we just said, we have several clinical data readouts and AD submissions for our key assets and including mesutoclax, soficitinib, and also ICP-488. And we are also excited about the upcoming results for our early assets, including the ADC platform and also our project like VAV1 new target globally, and we try to get the results as soon as possible already in Phase I and a few other programs. So we're also excited about our platforms. In addition to ADC, we have TCEs, we have IOO, we have all the small molecule project, molecular glue and et cetera. And this will generate a lot of differentiated candidates and from our platforms. So we are very excited about this year. And also, we look forward to seeing you in person over the next few days during the NDR. So thank you so much. I stop here.

Thank you, Jasmine, and thank you, everyone, for joining today's call. We're going to wrap up a call here. Thank you. Have a good day.

Bye.