adr-20211231

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

_________________

FORM 10-K

_________________

(Mark One)

For the fiscal year ended December 31, 2021

For the transition period from ___________ to ___________

Commission File Number: 001-40947

_________________

LianBio

(Exact Name of Registrant as Specified in its Charter)

_________________

(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code: (609) 486-2308

_________________

Securities registered pursuant to Section 12(b) of the Act:

Title of each class TradingSymbol(s) Name of each exchangeon which registered

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes oNox

Indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. Yes oNox

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes oNox

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yesx No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer o Accelerated filer o

Non-accelerated filer x Smaller reporting company x

Emerging growth company x

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. x

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x

The aggregate market value of the Registrant’s ordinary shares held by non-affiliates of the Registrant was $682.0 million as of the closing of the Registrant’s initial public offering on November 3, 2021 (based on a closing price of $13.50 per ADS as quoted by the Nasdaq Global Market as of such date). In determining the market value of the voting equity held by non-affiliates, ordinary shares of the Registrant beneficially owned by each director and officer and each person who owns 10% or more of the Registrant’s outstanding ordinary shares have been excluded. This determination of affiliate status is not necessarily a conclusive determination for other purposes.

As of March 18, 2022, 107,275,458 ordinary shares of the registrant, par value $0.000017100448 per share, were outstanding, of which 20,906,116 ordinary shares were held in the form of American Depositary Shares.

DOCUMENTS INCORPORATED BY REFERENCE

The registrant intends to file a definitive proxy statement pursuant to Regulation 14A for its 2022 Annual Meeting of Shareholders scheduled to be held on June 8, 2022. Portions of such definitive proxy statement are incorporated by reference into Part III of this Annual Report on Form 10-K to the extent stated herein.

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PART I

ITEM 1. Business 8

ITEM 1A. Risk Factors 86

ITEM 1B. Unresolved Staff Comments 157

ITEM 2. Properties 157

ITEM 3. Legal Proceedings 157

ITEM 4. Mine Safety Disclosures 157

PART II

ITEM 6. [Reserved] 167

ITEM 7A. Quantitative and Qualitative Disclosures About Market Risk 178

ITEM 8. Financial Statements and Supplementary Data 179

ITEM 9A. Controls and Procedures 211

ITEM 9B. Other Information 212

ITEM 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections 212

PART III

ITEM 10. Directors, Executive Officers and Corporate Governance 213

ITEM 11. Executive Compensation 213

ITEM 14. Principal Accountant Fees and Services 213

PART IV

ITEM 15. Exhibits and Financial Statement Schedules 214

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CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Annual Report on Form 10-K contains forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995, about us and our industry that involve substantial risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. All statements other than statements of historical facts contained in this Annual Report on Form 10-K, including statements regarding our strategy, future operations, future financial position, prospects, plans, objectives of management and expected growth, are forward-looking statements. These statements are based on our current beliefs, expectations and assumptions regarding our intentions, beliefs or current expectations concerning, among other things, the future of our business, future plans and strategies, our operational results and other future conditions. Forward-looking statements involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements.

Forward-looking statements can be identified by words such as “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “plan,” “predict,” “project,” “seek,” “target,” “will,” “would,” “could,” “should,” “continue,” “contemplate” and other similar expressions, although not all forward-looking statements contain these identifying words. These forward-looking statements include, among other things, statements about:

•our ability to successfully develop, gain regulatory approval for and launch commercial products in Greater China and other Asian markets;

•our ability to deliver innovative therapeutic solutions to patients and become a leading biopharmaceutical company in Greater China, including Mainland China, Hong Kong, Taiwan and Macau, and other Asian markets;

•our plans and ability to leverage data generated in our partners’ global registrational trials and clinical development programs to obtain regulatory approval for and bring our current product candidates to market in our licensed territories, and our plans to maximize patient reach for each of our product candidates;

•our partners’ announced plans and expectations with respect to the success, cost and timing of their product development activities, preclinical studies and clinical trials, including statements regarding the timing of initiation and completion of studies or trials and related preparatory work, the timing of expected review from regulatory authorities and the period during which the results of the trials are expected to become available;

•our ability to expand our pipeline through the continued strategic in-licensing of innovative and complementary product candidates with the potential to become the new standard of care in Greater China and other Asian markets;

•our ability to successfully establish an international infrastructure, including by building a focused salesforce in China and leveraging the commercial infrastructure we create to benefit our other assets;

•our ability to establish and maintain relationships and collaborations with investors and our current and any future licensing partners that will contribute to our success in sourcing value and creating partnerships to enable us to build out a broad and clinically validated pipeline;

•our ability to design, initiate and complete any clinical trials to advance our current product candidates, including mavacamten, TP-03, NBTXR3, infigratinib, BBP-398, LYR-210, omilancor, NX-13 and sisunatovir, as well as any future product candidates, towards regulatory approval in China and our other licensed territories;

•our ability to conduct, and the timing of and costs related to, our product development activities, including any preclinical studies and related clinical trials in Greater China and other Asian markets of our current and any future product candidates, and our ability to obtain, and the timing of and costs related to, potential regulatory approval of such product candidates in Greater China and other Asian markets;

•our plans to pursue the development of certain product candidates for additional treatment indications;

•our ability to successfully utilize the data we may generate from any clinical trials we conduct in Greater China or other territories, including in conjunction with data from clinical trials conducted by our partners, to seek regulatory approval in Greater China and other Asian markets;

•our plans and ability to join our current and future partners’ clinical and registrational trials and our plans and ability to initiate and complete our standalone clinical and registrational trials;

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•our ability to design and implement the development strategies for our product candidates in each of our licensed territories and, where applicable, our ability to design and implement global development strategies for our product candidates in new indications in connection with our local development strategies;

•the potential for certain of our current and future product candidates to have more benign safety profiles or result in a differentiated safety profiles than currently available therapeutic options;

•the size, composition and growth potential of the patient populations and markets we intend to target with our product candidates and our ability to develop and commercialize product candidates to address those patient populations and markets;

•our ability to successfully procure from our partners or other third parties, as applicable, sufficient supply of our product candidates for any preclinical studies, clinical trials or commercial use, if approved;

•our ability to obtain funding for our operations, including funding necessary to complete further development and commercialization of our product candidates and our general and administrative expenses;

•the rate and degree of market acceptance of our product candidates;

•our ability to attract and retain key scientific or management personnel;

•the impact of laws and regulations and of any legal and regulatory developments in our licensed territories or internationally;

•our expectations regarding our ability to obtain and maintain intellectual property protection for our product candidates;

•our ability to license intellectual property relating to our product candidates and to comply with our existing license and collaboration agreements;

•our reliance on third parties to conduct product development, manufacturing and other services, and any agreements we have or into which we may enter with such parties in connection with the commercialization of our product candidates and any other approved product;

•our expectations regarding the time during which we will be an emerging growth company or smaller reporting company;

•the direct and indirect impact of the COVID-19 pandemic on our business, operations (including clinical trials) and the markets and communities in which we and our partners, collaborators and vendors operate;

•our estimates of our expenses, capital requirements and needs for additional financing; and

•other risks and uncertainties, including those listed in “Part I—Item 1A—Risk Factors” of this Annual Report on Form 10-K.

Although we base these forward-looking statements on assumptions that we believe are reasonable when made, we caution investors that forward-looking statements are not guarantees of future performance and that our actual results of operations, financial condition and liquidity, and the development of the industry in which we operate may differ materially from those made in or suggested by the forward-looking statements contained in this Annual Report on Form 10-K. In addition, even if our results of operations, financial condition and liquidity, and the development of the industry in which we operate are consistent with the forward-looking statements contained in this Annual Report on Form 10-K, those results or developments may not be indicative of results or developments in subsequent periods.

Given these risks and uncertainties, investors are cautioned not to place undue reliance on these forward-looking statements. Any forward-looking statement that we make in this Annual Report on Form 10-K speaks only as of the date of such statement, and we undertake no obligation to update any forward-looking statements or to publicly announce the results of any revisions to any of those statements to reflect future events or developments. Comparisons of results for current and any prior periods are not intended to express any future trends or indications of future performance, unless specifically expressed as such, and should only be viewed as historical data. Investors should, therefore, not rely on these forward-looking statements as representing our views as of any date subsequent to the date of this Annual Report on Form 10-K.

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In addition, statements that “we believe” and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based upon information available to us as of the date of this Annual Report on Form 10-K, and while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain and investors are cautioned not to unduly rely upon these statements. Unless the context requires otherwise, references in this report to the “Company,” “LianBio,” “we,” “us” and “our” refer to LianBio and its consolidated subsidiaries.

Risk factors summary

Our business is subject to a number of risks that are discussed more fully in “Part I—Item 1A—Risk Factors” of this Annual Report on Form 10-K. These risks include the following:

•Changes in the economic, political, legal and social conditions and policies of the Chinese government or in relations between China and the United States (or other countries) may materially and adversely affect our business, financial condition, results of operations, access to capital, and the market price of our ADSs. Recent statements made and regulatory actions undertaken by China’s government, including the enactment of the Data Security Law of the People’s Republic of China (the “Data Security Law”), as well as our obligations to comply with China’s new Cybersecurity Review Measures (which became effective on February 15, 2022), regulations and guidelines relating to the multi-level protection scheme (“MLPS”), the Personal Information Protection Law of the People’s Republic of China (the “PIPL”) and any other future laws and regulations may require us to incur significant expenses and could materially affect our ability to conduct our business, accept foreign investments, list on a foreign exchange or stay listed on Nasdaq. For additional information regarding the risks associated with having the majority of our operations in China, see “Part I—Item 1A—Risk Factors—Risks Related to Doing Business in China and Our International Operations.”

•China’s economic, political and social conditions, as well as governmental policies, could affect the business environment and financial markets in China, our ability to operate our business, our liquidity and our access to capital.

•Although the audit report included in this Annual Report on Form 10-K is prepared by U.S. auditors who are currently inspected by the Public Company Accounting Oversight Board (the “PCAOB”), there is no guarantee that future audit reports will be prepared by auditors that are completely inspected by the PCAOB and, as such, our investors may in the future be deprived of such inspections, which could result in limitations or restrictions to our ability to access the U.S. capital markets. Furthermore, trading in our securities may be prohibited under the Holding Foreign Companies Accountable Act (the “HFCA Act”), the Accelerating Holding Foreign Companies Accountable Act (the “AHFCA Act”) (if enacted) or the America COMPETES Act (if enacted) if the SEC subsequently determines our audit work is performed by auditors that the PCAOB is unable to inspect or investigate completely or the SEC identifies us as a Commission-Identified Issuer (as defined below), and as a result, U.S. national securities exchanges, such as the Nasdaq, may determine to delist our securities.

•Proceedings brought by the SEC against China-based accounting firms could result in our inability to file future financial statements in compliance with the requirements of the Exchange Act.

•The approval of, or filing or other procedures with, the China Securities Regulatory Commission (“CSRC”) or other Chinese regulatory authorities may be required in connection with issuing our equity securities to foreign investors under Chinese law, and, if required, we cannot predict whether we will be able, or how long it will take us, to obtain such approval or complete such filing or other procedures. We are also required to obtain business licenses from Chinese authorities in connection with our general business activities currently conducted in China.

•The Chinese government may intervene in or influence our operations at any time, which could result in a material change in our operations and significantly and adversely impact the value of our ADSs, and the Chinese government has indicated an intent to increase the government’s oversight and control over offerings conducted overseas and foreign investment in China-based issuers, which could significantly limit or completely hinder our ability to offer ADSs to our investors, and could cause the value of our ADSs to significantly decline or become worthless. Due to our extensive operations in China, any future Chinese, U.S. or other rules and regulations that place restrictions on capital raising or other activities by companies with extensive operations in China could adversely affect our business, results of operations and the market price of our ADSs.

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•Pharmaceutical companies in China are required to comply with extensive regulations and hold a number of permits and licenses to carry on their business. Our ability to obtain and maintain these regulatory approvals is uncertain, and future government regulation may place additional burdens on our efforts to commercialize our product candidates.

•We have incurred significant losses since our incorporation, have not generated any revenue from product sales to date and anticipate that we will continue to incur losses in the future and may never achieve or maintain profitability.

•Our business model is designed to continue to in-license additional product candidates for development. We will likely need substantial additional funding for our future in-licensing and product development programs and commercialization efforts, which may not be available on acceptable terms, or at all. If we are unable to raise capital on acceptable terms when needed, we could incur losses or be forced to delay, reduce or terminate such efforts.

•We have a very limited operating history, which may make it difficult to evaluate the success of our business to date and to assess our future viability.

•We are heavily dependent on the successful development and commercialization of our late-stage product candidates, including mavacamten, TP-03 and NBTXR3.

•All of our product candidates are still in clinical development. If we are unable to advance our product candidates through clinical development, obtain regulatory approval and ultimately commercialize our product candidates or experience significant delays in doing so, our business, financial condition, results of operations and prospects will be materially adversely affected.

•Obtaining and maintaining regulatory approval of our product candidates in one jurisdiction does not mean that we will be successful in obtaining or maintaining regulatory approval of our product candidates in other jurisdictions.

•If we experience delays or difficulties in the enrollment of patients in clinical trials, the progress of such clinical trials and our receipt of necessary regulatory approvals could be delayed or prevented.

•Our failure to comply with data protection laws and regulations could lead to government enforcement actions and significant penalties against us, which could adversely impact our operating results.

•If we breach our licenses or other intellectual property-related agreements for our product candidates or otherwise experience disruptions to our business relationships with our licensors, we could lose the ability to continue the development and commercialization of our product candidates.

•We rely on Perceptive Advisors (“Perceptive”), our founder and a significant shareholder in our company, as a source for identifying partners from which we may in-license product candidates. If Perceptive divests of its investment in our company or is no longer a significant shareholder, we may lose access to its expertise in sourcing opportunities and our business could be substantially harmed. Perceptive and its affiliates exercise significant influence over our Company, which may limit the ability of our investors and other holders to influence corporate matters and could delay or prevent a change in corporate control. As of March 18, 2022, Perceptive and its affiliates beneficially own 52.5% of our ordinary shares, based on the number of shares outstanding as of March 18, 2022. Two of our current non-employee directors are affiliated with Perceptive. We have also entered into a director nomination agreement (the “Director Nomination Agreement”) with Perceptive that provides Perceptive the right to designate nominees to our board of directors so long as Perceptive beneficially owns 5% or more of the total number of shares that it owned as of the completion of our initial public offering in November 2021. Additionally, Perceptive may invest in or advise businesses that directly or indirectly compete with certain portions of our business or that are suppliers or customers of our business in such a way that may not always coincide with minority ADS holders’ interests.

•We rely on third parties to conduct some of our preclinical studies and clinical trials. If these third parties do not successfully carry out their contractual duties or meet expected deadlines, we may not be able to obtain regulatory approval for or commercialize our product candidates and our business could be substantially harmed.

•If we are unable to obtain and maintain patent and other intellectual property protection for our technology and product candidates through intellectual property rights, or if the scope of such intellectual property rights obtained is not sufficiently broad, third parties may compete directly against us, and our ability to successfully develop and commercialize any of our product candidates and technology may be adversely affected.

The foregoing is only a summary of some of our risks. For a more detailed discussion of these and other risks investors should consider before making an investment in our securities, see “Part I—Item 1A—Risk Factors.”

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INDUSTRY AND MARKET DATA

Although we are responsible for all disclosure contained in this Annual Report on Form 10-K, in some cases we have relied on certain market and industry data obtained from third-party sources that we believe to be reliable. Our estimates of the addressable market for our various product candidates are derived from independent industry publications, government publications and third-party forecasts, as well as epidemiological data, including incidence and prevalence estimates of addressable populations from peer-reviewed scientific journal and medical research articles related to diagnosis and treatment of our various therapeutic indications. Certain population data used in this Annual Report on Form 10-K was calculated using information from the World Health Organization International Agency for Research on Cancer and the United Nations Population Prospectus 2019. While we are not aware of any misstatements regarding any market, industry or similar data presented herein, such data involves risks and uncertainties and is subject to change based on various factors, including those discussed under the heading “Cautionary Note Regarding Forward-Looking Statements” and in “Part I—Item 1A—Risk Factors” in this Annual Report on Form 10-K.

TRADEMARKS AND SERVICE MARKS

We have applied for rights to trademarks, service marks and trade names for use in connection with the operation of our business, including, but not limited to, LianBio, 联拓 and 联拓生物. All other trademarks or service marks appearing in this Annual Report on Form 10-K that are not identified as marks owned or applied for by us are the property of their respective owners.

Solely for convenience, the trademarks, service marks and trade names referred to in this Annual Report on Form 10-K may be listed without the ®, (TM) and (sm) symbols, but we will assert, to the fullest extent under applicable law, our applicable rights in these trademarks, service marks and trade names. We do not intend our use or display of other entities’ trade names, trademarks or service marks to imply a relationship with, or endorsement or sponsorship of us by, any other entity.

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PART I

Item 1. Business

Overview

We are a global, science-driven biopharmaceutical company dedicated to developing and commercializing innovative medicines for patients with unmet medical needs, with an initial focus on in-licensing assets for Greater China and other Asian markets. We have purposefully designed our organization to successfully execute on our vision by identifying, sourcing, developing and commercializing product candidates and partnering with highly innovative biopharmaceutical companies around the world. We are establishing an international infrastructure to position ourselves as a partner of choice with a platform to provide access to our target markets.

Our model leverages a number of key elements, including transformative in-licensing, development and commercialization approaches that we believe will enable us to deliver innovative therapeutic solutions to patients in Greater China, including Mainland China, Hong Kong, Taiwan and Macau, and other Asian markets. Our deep relationships with our founder, Perceptive Advisors (“Perceptive”), as well as our broader investor base, position us to access and capture attractive business development opportunities. We have also entered into high-value strategic collaborations with Pfizer Inc. (“Pfizer”), which offers optionality to leverage its broad reach and commercial infrastructure in Greater China, and BridgeBio Pharma LLC (“BridgeBio”), which provides us with preferential access to an innovative pipeline of more than 20 product development candidates. We have assembled a strong pipeline of nine assets across five therapeutic areas, each with its own distinct value proposition and the potential to drive new standards of care across cardiovascular, oncology, ophthalmology, inflammatory disease and respiratory indications. We are currently conducting one registrational study, EXPLORER-CN for mavacamten in obstructive hypertrophic cardiomyopathy (“oHCM”), and plan to initiate three additional registrational studies over the next 12 months to advance our product candidates towards regulatory approval in China.

Today, China represents the second largest pharmaceutical market in the world, with estimated branded pharmaceutical market revenues of $89 billion in 2020, and which are expected to reach $187 billion by 2025. Recent regulatory reforms aimed at accelerating drug availability, a series of government development initiatives to support innovation and an improving reimbursement and access landscape have all increased the strategic importance of the Chinese pharmaceutical market. In addition, enhanced intellectual property protection, increasing healthcare coverage and capital inflows into life sciences have created a more favorable environment for providing access to innovative medicines. While China is becoming an increasingly critical component of biopharmaceutical companies’ global development and commercialization strategies, challenges remain for Western companies to access this market. We have designed our company with fit-for-purpose cross-border infrastructure to navigate the complex regulatory and commercial landscape in China. It is our vision to serve as a gateway to China for Western biopharmaceutical companies focused on the large addressable market unlocked by these recent advances and reforms.

Since our incorporation, we have rapidly assembled a broad, robust pipeline of nine product candidates across five different therapeutic areas. We have sought to in-license programs that have established proof of concept, are highly innovative and can provide differentiated treatment options for patients both globally and in our target markets. Pending the results from our upcoming registrational clinical trials, we aspire to launch multiple commercial products and to become a leading biopharmaceutical company in Greater China and other Asian markets in the coming years. We will also continue to expand our pipeline by anchoring our therapeutic areas of focus with core assets and then building around them to drive development and future commercial and market access synergies.

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Regulatory developments

Revised cybersecurity review measures

On July 10, 2021, the Cyberspace Administration of China (“the CAC”), published a draft revision to the existing Cybersecurity Review Measures for public comment, (“the Revised Draft CAC Measures”) and, together with 12 other Chinese regulatory authorities, released the final version of the Revised Draft CAC Measures (the “Revised CAC Measures”) on December 28, 2021, which came into effect on February 15, 2022. Pursuant to the Revised CAC Measures, critical information infrastructure operators procuring network products and services and online platform operators carrying out data processing activities, which affect or may affect national security, shall conduct a cybersecurity review pursuant to the provisions therein. In addition, online platform operators possessing personal information of more than one million users seeking to be listed on foreign stock markets must apply for a cybersecurity review.

Currently, the Revised CAC Measures have not materially affected our business and operations, and as we do not maintain, nor do we intend to maintain in the future, personally identifiable health information of patients in China, we do not believe our business activities affect, nor would be interpreted to affect, national security. As of the date of this Annual Report on Form 10-K, we have not been informed by any relevant Chinese government authorities that we are identified as or considered a “critical information infrastructure operator” or “online platform operator.” However, in anticipation of the strengthened implementation of cybersecurity laws and regulations, there can be no assurance that we will not be deemed as a critical information infrastructure operator or online platform operator under the Chinese cybersecurity laws and regulations in the future, or that the Revised CAC Measures will not be further amended or other laws or regulations will not be promulgated to subject us to the cybersecurity review or other compliance requirements. In such case, we may face challenges in addressing such enhanced regulatory requirements. For additional information, see “Part I—Item 1A—Risk Factors––Risks Related to our Business Operations—Our failure to comply with data protection laws and regulations could lead to government enforcement actions and significant penalties against us, which could adversely impact our operating results,” “Part I—Item 1A—Risk Factors—Risks Related to Doing Business in China and Our International Operations—Compliance with the Data Security Law of the People’s Republic of China, Cybersecurity Review Measures, the Personal Information Protection Law of the People’s Republic of China, regulations and guidelines relating to the multi-level protection scheme and any other future laws and regulations may entail significant expenses and could materially affect our business,” and “Part I—Item 1A—Risk Factors—Risks Related to Doing Business in China and Our International Operations—The approval of, or filing or other procedures with, the CSRC or other Chinese regulatory authorities may be required in connection with issuing our equity securities to foreign investors under Chinese law, and, if required, we cannot predict whether we will be able, or how long it will take us, to obtain such approval or complete such filing or other procedures. We are also required to obtain business licenses from Chinese authorities in connection with our general business activities currently conducted in China.”

Proposed network data security management

On November 14, 2021, the CAC further published the Regulations on Network Data Security Management (Draft for Comment) (the “Draft Management Regulations”), under which data processors refer to individuals and organizations who determine the data processing activities in terms of the purpose and methods at their discretion. The Draft Management Regulations reiterate that data processors shall be subject to cybersecurity review if they process personal information of more than one million persons and aim to list on foreign stock markets, or the data processing activities influence or may influence national security. The Draft Management Regulations also request data processors seeking to list on foreign stock markets to annually assess their data security by themselves or through data security service organizations, and submit the assessment reports to relevant competent authorities.

As the Draft Management Regulations were released for public comment only, and the draft provisions and anticipated adoption or the effective date are subject to change, the interpretation and implementation of such measures remain substantially uncertain. We cannot predict the impact of the Draft Management Regulations, if any, on the operations of our Company at this stage, and we will closely monitor and assess any development in the rule-making process.

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Potential CSRC approval required

On July 6, 2021, the General Office of the Communist Party of China Central Committee and the General Office of the State Council jointly promulgated the Opinions on Strictly Cracking Down on Illegal Securities Activities in Accordance with the Law, pursuant to which Chinese regulators are required to accelerate rulemaking related to the overseas issuance and listing of securities, and update the existing laws and regulations related to data security, cross-border data flow, and management of confidential information. Numerous regulations, guidelines and other measures have been or are expected to be adopted under the umbrella of or in addition to the Cyber Security Law of the People’s Republic of China (the “Cyber Security Law”) and the Data Security Law. As there are still uncertainties regarding the interpretation and implementation of such regulatory guidance, we cannot assure investors that we will be able to comply with new regulatory requirements relating to our future overseas capital-raising activities and we may become subject to more stringent requirements with respect to matters including data privacy and cross-border investigation and enforcement of legal claims.

On December 24, 2021, the China Securities Regulatory Commission (“CSRC”) released for public comment draft rules titled Provisions of the State Council on the Administration of Overseas Securities Offering and Listing by Domestic Companies (Draft for Comments) and Administrative Measures for the Filing of Overseas Securities Offering and Listing by Domestic Companies (Draft for Comments) (the "Draft Overseas Listing Rules"), which, among other things, require certain companies to fulfill a filing procedure in respect of their overseas offerings and listings if such companies meet the criteria set forth in the Draft Overseas Listing Rules. However, there remains uncertainty as to the final version and effective date of the Draft Overseas Listing Rules, how the Draft Overseas Listing Rules will be interpreted or implemented and whether the Chinese regulatory authorities may adopt new laws, regulations, rules, or detailed implementation and interpretation in relation, or in addition, to the Draft Overseas Listing Rules.

As of the date of this Annual Report on Form 10-K, we have not received any inquiry, notice, warning or sanction regarding obtaining approval, or completing filing or other procedures in connection with offering our equity securities to foreign investors from the CSRC or any other Chinese regulatory authorities that have jurisdiction over our operations. However, any existing or future laws or regulations relating to our business, industry or cross-border financing activities such as securities offerings and listings, or interpretations of these laws or regulations, may change. As a result, it is uncertain whether we will be required to obtain approval from or complete filing or other procedures with the Chinese government for our offerings, or to list or remain listed on U.S. exchanges in the future. If such an approval, filing or other procedure is required, it is uncertain whether we will be able and how long it will take for us to obtain the approval or complete the filing or other procedures, despite our best efforts. Even if such approval is obtained or filing or other procedures are completed, it could be withdrawn or rescinded. If we, or our subsidiaries were required to obtain such approval or complete such filing or other procedures in the future but fail to do so, we may not be able to become listed, or maintain our listing status, on a U.S. exchange, which could materially affect the interest of investors.

For additional information, see “Part I—Item 1A—Risk Factors—Risks Related to Doing Business in China and Our International Operations—The approval of, or filing or other procedures with, the CSRC or other Chinese regulatory authorities may be required in connection with issuing our equity securities to foreign investors under Chinese law, and, if required, we cannot predict whether we will be able, or how long it will take us, to obtain such approval or complete such filing or other procedures. We are also required to obtain business licenses from Chinese authorities in connection with our general business activities currently conducted in China.”

Other

To operate our general business activities currently conducted in China, each of our Chinese subsidiaries is required to obtain a business license from the State Administration for Market Regulation (“SAMR”). Each of our Chinese subsidiaries has obtained a valid business license from the SAMR, and no application for any such license has been denied.

Corporate information

We are an exempted company incorporated in the Cayman Islands with limited liability under the Companies Act of the Cayman Islands on July 17, 2019. Any company that is registered in the Cayman Islands but conducts business mainly outside of the Cayman Islands may apply to be registered as an exempted company. The principal executive office of our research and development operations is located at 16F, Building 5, Enterprise World, 150 Hubin Road, Huangpu District, Shanghai, People’s Republic of China, 200021. Our telephone number at this address is (021) 2308 1188. Our current registered office in the Cayman Islands is located at the offices of International Corporation Services Ltd., 2nd Floor, Harbour Place, 103 South Church Street, P.O. Box 472, George Town, Grand Cayman KY1-1106, Cayman Islands. Our principal executive offices are located at 103 Carnegie Center Drive, Suite 309, Princeton, New Jersey 08540 and our telephone number is (609) 486-2308.

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Dividends and other distributions

We are a holding company, and we may rely on dividends and other distributions on equity paid by our Chinese subsidiaries for our cash and financing requirements, including the funds necessary to pay dividends and other cash distributions to our shareholders or holders of our ADSs or to service any debt we may incur. If any of our Chinese subsidiaries incur debt on its own behalf in the future, the instruments governing such debt may restrict their ability to pay dividends to us. To date, there have not been any such dividends or other distributions from our Chinese subsidiaries to our subsidiaries located outside of China. In addition, as of the date of this Annual Report on Form 10-K, none of our subsidiaries have ever issued any dividends or distributions to us or their respective shareholders outside of China. As of the date of this Annual Report on Form 10-K, neither we nor any of our subsidiaries have ever paid dividends or made distributions to U.S. investors. Our Chinese operating subsidiary, Shanghai LianBio Development Co., Ltd., received $5,000,000, $2,500,095, $17,499,905, $5,000,000, $9,999,905 and $14,999,995 in equity financing via capital contributions from its shareholder outside of China in February 2020, September 2020, December 2020, October 2021, December 2021 and January 2022, respectively, to fund its business operations in China. In the future, cash proceeds raised from overseas financing activities may be transferred by us to our Chinese subsidiaries via capital contribution or shareholder loans, as the case may be.

According to the Foreign Investment Law of the People’s Republic of China and its implementing rules, which jointly established the legal framework for the administration of foreign-invested companies, a foreign investor may, in accordance with other applicable laws, freely transfer into or out of China its contributions, profits, capital earnings, income from asset disposal, intellectual property, royalties acquired, compensation or indemnity legally obtained, and income from liquidation, made or derived within the territory of China in RMB or any foreign currency. According to the Company Law of the People’s Republic of China and other Chinese laws and regulations, our Chinese subsidiaries may pay dividends only out of their respective accumulated profits as determined in accordance with Chinese accounting standards and regulations. In addition, each of our Chinese subsidiaries is required to set aside at least 10% of its accumulated after-tax profits, if any, each year to fund a certain statutory reserve fund, until the aggregate amount of such fund reaches 50% of its registered capital. Where the statutory reserve fund is insufficient to cover any loss the Chinese subsidiary incurred in the previous financial year, its current financial year’s accumulated after-tax profits shall first be used to cover the loss before any statutory reserve fund is drawn therefrom. Such statutory reserve funds and the accumulated after-tax profits that are used for covering the loss cannot be distributed to us as dividends. At their discretion, our Chinese subsidiaries may allocate a portion of their after-tax profits based on Chinese accounting standards to a discretionary reserve fund.

Renminbi is not freely convertible into other currencies. As result, any restriction on currency exchange may limit the ability of our Chinese subsidiaries to use their potential future renminbi revenues to pay dividends to us. The Chinese government imposes controls on the convertibility of renminbi into foreign currencies and, in certain cases, the remittance of currency out of China. Shortages in availability of foreign currency may then restrict the ability of our Chinese subsidiaries to remit sufficient foreign currency to our offshore entities for our offshore entities to pay dividends or make other payments or otherwise to satisfy our foreign-currency-denominated obligations. The renminbi is currently convertible under the “current account,” which includes dividends, trade and service-related foreign exchange transactions, but not under the “capital account,” which includes foreign direct investment and foreign currency debt, including loans we may secure for our onshore subsidiaries. Currently, our Chinese subsidiaries may purchase foreign currency for settlement of “current account transactions,” including payment of dividends to us, without the approval of the State Administration of Foreign Exchange of China (“SAFE”) by complying with certain procedural requirements. However, the relevant Chinese governmental authorities may limit or eliminate our ability to purchase foreign currencies in the future for current account transactions. The Chinese government may continue to strengthen its capital controls, and additional restrictions and substantial vetting processes may be instituted by SAFE for cross-border transactions falling under both the current account and the capital account. Any existing and future restrictions on currency exchange may limit our ability to utilize revenue generated in renminbi to fund our business activities outside of China or pay dividends in foreign currencies to holders of our securities. Foreign exchange transactions under the capital account remain subject to limitations and require approvals from, or registration with, SAFE and other relevant Chinese governmental authorities. This could affect our ability to obtain foreign currency through debt or equity financing for our subsidiaries. See “Part I—Item 1A—Risks Related to Doing Business in China and Our International Operations—We may rely on dividends and other distributions on equity paid by our Chinese subsidiaries to fund any cash and financing requirements we may have, and any limitation on the ability of our Chinese subsidiaries to make payments to us could have a material and adverse effect on our ability to conduct our business” for a detailed discussion of the Chinese legal restrictions on the payment of dividends and our ability to transfer cash within our group. In addition, ADS holders may potentially be subject to Chinese taxes on dividends paid by us in the event we are deemed a Chinese resident enterprise for Chinese tax purposes. See “Part II—Item 5—Taxation—China taxation” for more details.

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Organizational structure

The following diagram depicts our corporate structure. As of the date of this Annual Report on Form 10-K, the shares of each of our subsidiaries are 100% owned by the respective entity displayed immediately above that subsidiary. Certain warrant rights are outstanding and may be exercised in the future for equity interests in our Cayman parent entity, LianBio, and our subsidiary, Lian Cardiovascular, as described in “Note 10: Equity” in the notes to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K. Currently, our corporate structure contains no variable interest entities.

Within the organization, investor cash inflows have all been received by our parent Cayman entity, LianBio. Cash to fund our Chinese operations is transferred from our Cayman parent entity down through our Hong Kong entities and then into our Chinese entities through capital contributions. Cash to fund our operations in the United States is transferred from our Cayman parent entity down to our United States entity through a capital contribution.

Our pipeline

Cardiovascular

Mavacamten for the potential treatment of HCM

We have partnered with MyoKardia, Inc. (“MyoKardia,” now a wholly-owned subsidiary of Bristol-Myers Squibb (“BMS”)) to develop and commercialize mavacamten in Greater China and other Asian markets. Mavacamten is an oral small-molecule allosteric modulator of cardiac myosin, which is initially being studied for the treatment of hypertrophic cardiomyopathy (“HCM”) and has potential therapeutic applications for other diseases of diastolic dysfunction. HCM is a disease that leads to progressive deterioration of heart function and an increased risk of atrial fibrillation, stroke, heart failure and sudden cardiac arrest. There are currently no approved therapies for HCM in China. HCM can be segmented into two groups, obstructive hypertrophic cardiomyopathy (“oHCM”) and non-obstructive HCM (“nHCM”). In 2020, MyoKardia completed a global Phase 3 clinical trial of mavacamten for the treatment of symptomatic oHCM. This trial met its primary and all secondary endpoints and mavacamten was observed to be well-tolerated. We have completed enrollment in a pharmacokinetics (“PK”) trial and begun dosing patients in a Phase 3 clinical trial, EXPLORER-CN, in China. If the data are consistent with the data demonstrated in global clinical trials, we intend to use the China data in combination with data generated in global trials conducted by MyoKardia to seek regulatory approval in China. We also plan to develop mavacamten in nHCM and heart failure with preserved ejection fraction (“HFpEF”). In February 2022, we announced that the Center for Drug Evaluation (“CDE”) of the National Medical Products Administration (“NMPA”) granted Breakthrough Therapy Designation in China for mavacamten for the treatment of patients with oHCM.

Hypertrophic cardiomyopathy disease overview

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HCM is an inherited form of cardiomyopathy mainly caused by genetic mutations that result in excessive cardiac muscle contraction and abnormally thick cardiac muscle growth. HCM is characterized by left ventricular hypertrophy unexplained by secondary causes and a nondilated left ventricle with preserved or increased ejection fraction. The histological features of HCM include hypertrophy and disarray of myocytes, cardiac muscle cells, as well as interstitial fibrosis. The hypertrophy is also frequently associated with left ventricular diastolic dysfunction.

Patients with HCM are at increased risk for developing arrhythmia, shortness of breath, chest pain, heart failure and sudden cardiac death. The most frequent arrhythmia observed is atrial fibrillation, which occurs in 22% to 32% of HCM patients. Atrial fibrillation is also a major risk factor for thromboembolic stroke. The combination of the loss of ventricular filling and the rapid ventricular contraction results in further elevations of left ventricular diastolic pressure and symptoms of heart failure. Although rare, HCM is the most common cause of sudden cardiac death in young people and athletes under the age of 35.

HCM patients can be segmented into two groups:

•Obstructive HCM: In two-thirds of HCM patients, the path through which blood exits the heart, known as the left ventricular outflow tract (“LVOT”), becomes obstructed by the enlarged and diseased heart muscle, restricting the flow of blood from the heart to the rest of the body. oHCM patients are at an increased risk of severe heart failure and death.

•Non-Obstructive HCM: Patients with nHCM do not have significant LVOT obstruction but have reduced cardiac output due to an enlarged and stiffened heart muscle. These patients can be difficult to manage medically as they often present with an advanced state of disease due to damage that accumulates before patients become symptomatic.

Most cases of HCM appear to be inherited, as family members of HCM patients are at increased risk of developing the disease. Mutations in more than a dozen genes have been linked to the development of HCM. However, in 40% of patients, the causal mutation is not known. A typical HCM patient presents with a range of symptoms, including shortness of breath, chest pain and heart palpitations. Diagnosis of HCM is generally by echocardiography, a noninvasive technique that allows key parameters such as the thickness of the heart wall, the size of the left ventricle and the output of the heart to be quantitatively and qualitatively measured. Most patients are diagnosed in middle age. We estimate there are approximately 1.1 million to 2.8 million HCM patients in China, with approximately two-thirds of patients having oHCM, and one-third of patients having nHCM.

Current standard of care for HCM

There are currently no approved pharmacologic therapies indicated for the treatment of HCM in China. Patients in China are typically prescribed one or more drugs indicated for the treatment of hypertension, heart failure or other cardiovascular disorders to address disease symptoms. These drugs, including beta blockers, such as metoprolol, and calcium channel blockers, such as verapamil, may help some patients manage the symptoms of HCM, but they do not directly address the underlying cause of disease or affect disease progression. In some countries, but not in China, disopyramide, a sodium channel blocker with significant side effects, is added if patients do not respond to other therapies.

Despite pharmacologic management, symptoms and disease burden persist for many patients, and therapeutic options are limited. For a subset of patients with advanced disease progression or more pronounced symptoms, invasive therapies may be appropriate, including use of an implantable cardioverter-defibrillator, open surgical myectomy, percutaneous alcohol septal ablation or, in rare cases, heart transplantation for end-stage HCM. However, these invasive therapies are associated with inherent risks and require expertise that is not universally available in China.

HFpEF disease overview and current standard of care

HFpEF is a disease in which the heart’s ability to pump blood through the body is decreased due to the inability of the ventricle to fully relax and fill with blood. HFpEF can arise from multiple other conditions including diabetes, obesity, atrial fibrillation and high blood pressure. At a cellular level, cardiac myocytes in patients with HFpEF are thicker and shorter than normal myocytes, and collagen content is increased. Early symptoms of HFpEF include shortness of breath upon exertion and fatigue. Therapeutic management has typically been directed toward associated conditions such as hypertension and symptoms such as edema. Patients have historically been treated with standard medications for hypertension such as beta blockers or renin-angiotensin-aldosterone inhibitors, and in 2021 the United States Food and Drug Administration (“FDA”) approved Novartis AG’s Entresto for the treatment of HFpEF.

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Approximately 41% of heart failure cases are attributed to HFpEF. We believe there are approximately four million HFpEF patients in China. In a subset of approximately 10-20% of HFpEF patients, the underlying cause of symptoms is similar to that of nHCM, and we believe mavacamten has the potential to address this underlying disease pathology in HFpEF patients.

Mavacamten development path

Mavacamten was designed to correct or address the impaired cardiac muscle contractility and relaxation that characterizes HCM by acting on cardiac myosin, a key myocyte protein, to allow the heart muscle to relax, thereby expanding the volume of the heart and enabling it to pump more blood. In 2020, MyoKardia announced results from a global Phase 3 clinical trial called EXPLORER-HCM, in which patients with symptomatic oHCM treated with mavacamten experienced statistically significant and clinically meaningful improvements in symptoms, functional status and key aspects of quality of life. We have an exclusive license to develop and commercialize mavacamten in Greater China and other Asian markets.

Results from the global EXPLORER-HCM trial

Per data published in the Lancet, the EXPLORER-HCM trial was a randomized, double-blind, placebo-controlled Phase 3 clinical trial that enrolled 251 patients with symptomatic (New York Heart Association (“NYHA”) functional Class II or III) oHCM. Patients were randomized on a 1:1 basis to receive individualized once-daily dosing of mavacamten or placebo. Patients started on a dose of 5mg, with up to two opportunities for dose adjustments (to doses of 2.5mg, 5mg, 10mg or 15mg) based on a combination of residual LVOT gradient, drug plasma concentration and left ventricular ejection fraction levels. Patients were evaluated every two to four weeks for 30 weeks.

The primary endpoint for EXPLORER-HCM was a composite functional analysis designed to capture mavacamten’s effect on both symptoms and cardiac function. The composite functional endpoint was defined by either (1) the achievement of a ≥1.5mL/kg/min improvement in peak oxygen consumption (“pVO2”) accompanied by an improvement of ≥1 NYHA functional class, or (2) the achievement of a ≥3.0mL/kg/min improvement of pVO2 with no worsening in NYHA functional class. The 30-week treatment with mavacamten resulted in a highly statistically significant outcome relative to placebo (p=0.0005) for the primary endpoint.

Additionally, mavacamten demonstrated beneficial results (p≤0.0006) for all secondary endpoints: post-exercise LVOT peak gradient, pVO2, NYHA functional class, Kansas City Cardiomyopathy Questionnaire-Clinical Summary Score (“KCCQ-CSS”) and HCM Symptom Questionnaire Shortness-of-Breath subscore.

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The primary and all secondary endpoints of the EXPLORER-HCM trial were met with statistical significance (p≤0.0006 for all endpoints)

Results from the EXPLORER-HCM trial published in 2020

Mavacamten Group (n=123) Placebo Group (n=128) Difference1 (95% CI), p Value

Primary Endpoint2

Secondary Endpoints3

Note:Data are n (%) or mean (SD). HCMSQ-SoB=Hypertrophic Cardiomyopathy Symptom Questionnaire Shortness-of-Breath subscore. KCCQ-CSS= Kansas City Cardiomyopathy Questionnaire-Clinical Symptom Score. LVOT=Left Ventricular Outflow Tract. pVo2 = Peak Oxygen Consumption. NYHA = New York Heart Association.

1Model estimated least-square mean differences were reported for continuous variable.

2Patients with a non-evaluable primary endpoint and NYHA secondary endpoint were considered as non-responders. The response rates were

calculated with the N value as the denominator.

3N was the number analyzable for secondary endpoints based on availability of both baseline and week 30 values.

4Due to the smaller number evaluable for patient-reported outcome endpoints, additional post-hoc analyses compared the reasons for missing data.

Patients administered mavacamten showed rapid and sustained improvement in resting and Valsalva LVOT gradient compared with placebo. By week 30, 57% of mavacamten-treated patients had reductions in post-exercise LVOT peak gradient less than 30 mmHg compared to only 7% of patients on placebo.

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Mavacamten was well-tolerated in the clinical trial. Overall rates of adverse events, serious adverse events (“SAEs”) and cardiac adverse events, including atrial fibrillation, were comparable for patients treated with mavacamten versus placebo. Over 97% of patients completed the trial with similar rates of discontinuation in the mavacamten treatment group relative to the placebo group.

In February 2022, BMS announced positive topline results from Phase 3 VALOR-HCM trial, evaluating mavacamten in patients with obstructive hypertrophic cardiomyopathy who are eligible for septal reduction therapy.

Our strategy to seek regulatory approval of mavacamten in China

Our goal is to bring mavacamten to market in China for the treatment of oHCM patients. To accomplish this goal, we are currently conducting a Phase 3 clinical trial and a PK clinical trial in China to evaluate the safety, efficacy and pharmacokinetics in Chinese subjects and consistency with the corresponding data demonstrated in global trials. We completed subject dosing in the PK trial in November 2021 and initiated the Phase 3 EXPLORER-CN clinical trial in January 2022.

•Phase 3 EXPLORER-CN clinical trial: We have designed our randomized, double-blind, placebo-controlled Phase 3 EXPLORER-CN clinical trial to assess the safety and efficacy of mavacamten in Chinese adults with symptomatic oHCM. We expect to enroll approximately 81 patients, randomized 2:1. The primary endpoint is the change in Valsalva LVOT gradient from baseline to Week 30. Eligible patients will continue in a long-term extension treatment period.

•Pharmacokinetic trial in China: We are also conducting a PK trial of mavacamten in healthy adults in China.

We are also planning to pursue the development of mavacamten for the treatment of nHCM and HFpEF:

•nHCM: In 2020, MyoKardia announced that a double-blind, placebo-controlled Phase 2 clinical trial of mavacamten in symptomatic nHCM patients demonstrated that patients dosed with mavacamten had significant reductions in N-terminal pro-B type natriuretic peptide and cardiac troponin I, biomarkers of cardiac stress and injury that correlate with poor prognosis in multiple cardiovascular diseases. We intend to develop mavacamten in our licensed territories for the treatment of nHCM.

•HFpEF: We believe that mavacamten has the potential to directly address a key underlying pathology in HFpEF and we intend to develop mavacamten in our licensed territories for the treatment of HFpEF.

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Ophthalmology

TP-03 for the potential treatment of demodex blepharitis and meibomian gland disease

We have partnered with Tarsus Pharmaceuticals, Inc. (“Tarsus”) to develop and commercialize TP-03 (lotilaner ophthalmic solution, 0.25%) in Greater China. TP-03 is a novel, topical ophthalmic formulation of lotilaner, that is an antagonist of insect and arachnid γ-aminobutyric-gated chloride channels (“GABA-Cl”) and which is initially being studied for the treatment of Demodex blepharitis (“DB”) and has potential therapeutic applications for Meibomian Gland Disease (“MGD”). DB is caused by an infestation of Demodex mites triggering inflammation and is characterized by a specific type of debris called “collarettes” that form at the base of the eyelash follicles, inflammation of the eyelid margin, redness and ocular irritation. We estimate DB affects approximately 43 million patients in China. TP-03 is designed to paralyze and eventually cause the death of Demodex mites through the inhibition of parasite-specific GABA-Cl channels. The active ingredient in TP-03 is lotilaner, an anti-parasitic that is part of a class of molecules named isoxazolines. Tarsus has completed the first of two pivotal trials of TP-03 for the treatment of DB in the United States, Saturn-1. All pre-specified primary and secondary endpoints were met in Saturn-1, and complete resolution of DB signs was demonstrated in patients treated with TP-03. The second pivotal trial of TP-03 in DB, Saturn-2, has completed enrollment and is expected to announce topline results in April 2022. We plan to generate clinical data in China to be used in combination with clinical data generated in Saturn-1 and Saturn-2, if such data are positive, to seek regulatory approval in DB in Greater China. We also plan to develop TP-03 for the treatment of MGD.

DB disease overview

Blepharitis is a disease characterized by eye inflammation, irritation, redness and lid margin disease. Symptoms can become severe if left untreated, and progress to blurred vision, missing eyelashes, corneal damage and even blindness in extreme cases. Demodex mites are a common underlying cause of blepharitis, and they are the most common ectoparasite found on humans. The Demodex parasite causes a significant portion of blepharitis cases through an infestation of the eyelash follicles. Demodex infestation may be accompanied by cylindrical dandruff on the eyelids called collarettes. The presence of collarettes is pathognomonic for Demodex infestation. Collarettes are composed of partially digested epithelial cells, mite waste and eggs, among other things. Aging is the main risk factor for DB. Relapse is common in patients who have had DB as the Demodex mites can stay in the skin of the face even after they have been eradicated from the eyelid. We estimate DB affected approximately 43 million patients in China in 2020. We believe there is a significant opportunity to raise awareness of and improve the diagnosis rate of DB through physician and patient education. The approval and introduction of an effective disease-modifying therapy may help encourage patient and physician awareness to grow the identifiable patient population.

Current standard of care for DB

DB in China is most commonly diagnosed through signs of collarettes, sparse eyelashes, missing eyelash and trichiasis, among other symptoms, which is similar to the diagnosis approach in the United States. Other symptoms of DB, including eyelid redness, itching and dry eye, are non-specific and unclear for diagnosis. Patients are often diagnosed when they visit eye care professionals for other conditions such as dry eye, cataracts or contact lens discomfort. Light microscopy and slit lamps are used to diagnose DB, and testing prevalence and accuracy are expected to increase in the coming years. There are currently no FDA-approved therapies for DB. The condition is currently treated in some cases with tea tree oil and metronidazole to repel mites, along with a topical steroid to control inflammation. Key opinion leader (“KOL”) research indicates treatment typically is not efficacious, lasting two to three months, and 60% of patients relapse within six months, assuming any improvement to begin with. Many patients are not able to tolerate these treatments long-term. We believe the absence of a currently available FDA-approved treatment and a large existing patient population create a significant market opportunity in China.

MGD disease overview and current standard of care

MGD is a common eye condition where the glands do not secrete enough oil or when the oil they secrete is of poor quality. MGD is a leading cause of dry eye disease. In the early stages of the disease, patients are often asymptomatic but, if left untreated, MGD can cause exacerbated dry eye symptoms and eyelid inflammation. Symptoms include dryness, burning, itching, stickiness or crustiness, watering, light sensitivity, red eyes and foreign body sensation. Clinical signs of MGD have been shown to be correlated with infestation of a certain species of Demodex mite. We estimate 50% of diagnosed Demodex-driven MGD patients also have DB. The standard of care for the treatment of Demodex-driven MGD is similar to that of DB. Demodex-driven MGD patients are currently treated with tea tree oil and metronidazole to repel mites, along with a topical steroid to control inflammation. We believe, based on KOL research, there were an estimated 73 million Demodex-driven MGD patients in China in 2020. There are no currently approved therapies for MGD in China.

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TP-03 development path

Tarsus has completed the first of two pivotal trials of TP-03 for the treatment of DB in the United States, Saturn-1. All pre-specified primary and secondary endpoints were met in Saturn-1, and complete resolution of DB signs was demonstrated in patients treated with TP-03. Tarsus initiated a second pivotal clinical trial, Saturn-2, in May 2021, which has a similar design to Saturn-1. Saturn-2 has completed enrollment, and Tarsus is expected to announce topline results in April 2022. If successful, Tarsus has indicated that it expects these trials to support a new drug application (“NDA”) submission to the FDA. Tarsus has also announced plans to initiate clinical trials of TP-03 for the treatment of MGD. Previously, Tarsus conducted four Phase 2 clinical trials of TP-03 in patients with DB. Each of these trials demonstrated statistically significant collarette cure and mite eradication rates.

Results from pivotal phase 2b/3 Saturn-1 clinical trial

In June 2021, Tarsus announced positive results of the pivotal Phase 2b/3 Saturn-1 pivotal trial. All pre-specified primary and secondary endpoints were met, and complete resolution of DB signs was demonstrated in patients treated with TP-03.

•44% of patients on TP-03 achieved the primary endpoint of complete collarette cure, defined as 0-2 collarettes per lid at day 43, compared to 7% on vehicle (p<0.0001).

•81% of patients on TP-03 achieved a clinically meaningful collarette cure, defined as 0-10 collarettes per lid at day 43 compared to 23% of those on vehicle (p<0.0001).

•68% of patients on TP-03 achieved mite eradication defined as 0 mites per lash at day 43, compared to 18% on vehicle (p<0.0001).

Additionally, significant efficacy in lid erythema (redness) was demonstrated across multiple measures including complete and clinically meaningful composite cures, and in erythema alone. Results showed 45% of patients improved erythema by one (1) grade or more (compared to 28% of patients on vehicle, p=0.0002) and 19% of patients on TP-03 achieved a complete erythema cure (compared to 7% of patients on vehicle, p=0.0001).

TP-03 was well tolerated with a safety profile similar to the vehicle group. Additionally, most TP-03 patients (92%) reported that the drop comfort was neutral to very comfortable. There were no serious treatment-related adverse events nor any treatment-related adverse events leading to treatment discontinuation.

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Regulatory Endpoint of Complete Collarette Cure Observed by Week 2

Clinically Meaningful Collarette Cure Observed by Week 1: Over 90% Avg. Reduction in Collarettes (Over 100 to Less than 10 per Lid)

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Tarsus has also completed four Phase 2 clinical trials in which TP-03 achieved efficacy endpoints including collarette grade, mite density, collarette cure rate and/or mite eradication rate. TP-03 was generally well-tolerated in all four trials with no significant adverse events. Based on the strength and consistency of the Phase 2 and Phase 2b/3 data, we believe TP-03 has the potential to have a global impact, and that we will be able to leverage this data to move into a Phase 3 clinical trial in China and potentially establish a new standard of care for the treatment of DB in China.

Our strategy to seek regulatory approval of TP-03 in DB and MGD in China

We believe TP-03 has the potential to become the new standard of care for the treatment of DB, and our goal is to bring TP-03 to market for patients in China. To accomplish this goal, we plan to conduct a Phase 3 clinical trial to evaluate the safety, efficacy and pharmacokinetics in Chinese patients with DB and consistency with the corresponding data demonstrated in the United States. We expect to initiate clinical development of TP-03 in China in the second half of 2022.

We also intend to pursue the development of TP-03 in Greater China for the treatment of MGD. We plan to join any future global pivotal trial of TP-03 in MGD conducted by Tarsus. We believe that enrolling patients in China in a global Phase 3 clinical trial may expedite the global development program as well as enable us to seek regulatory approval in China.

Oncology

NBTXR3, a radioenhancer for the potential treatment of head and neck cancer and other solid tumors

We have partnered with Nanobiotix S.A. (“Nanobiotix”) to develop and commercialize NBTXR3, a radioenhancer designed to be injected directly into a malignant tumor prior to standard radiotherapy. When exposed to ionizing radiation, NBTXR3 has been shown to enhance the localized effect of radiotherapy, in our licensed territories of Mainland China, Hong Kong, Taiwan, Macau, South Korea, Singapore and Thailand. NBTXR3 is designed to increase the dose of radiotherapy delivered within the tumor without increasing the dose in surrounding healthy tissue. NBTXR3 may also prime the body’s immune response against cancer. We believe that NBTXR3 has a broadly applicable mechanism of action that has the potential to be used in conjunction with radiotherapy in the treatment of various solid tumor types. Clinical proof of concept for NBTXR3 has been demonstrated in soft tissue sarcoma, for which Nanobiotix received CE mark approval in the European Union, which is not a part of our licensed territory. Nanobiotix is currently prioritizing registration of NBTXR3 for the treatment of locally advanced head and neck cancer, for which the FDA has granted Fast Track designation for the treatment of elderly patients ineligible for platinum-based chemotherapies. In a Phase 1 clinical trial (Study 1100), NBTXR3 has shown the potential to convert patients who initially failed checkpoint inhibitor therapy into responders while also displaying a potential abscopal effect. Nanobiotix and its collaborators are currently conducting eight clinical trials to evaluate NBTXR3 as a potential treatment in various cancer indications. We plan to join the NBTXR3 development program by enrolling patients in China in five of Nanobiotix’s current and potential future global pivotal trials across indications and therapeutic combinations including immunotherapy, beginning with Nanobiotix’s ongoing Phase 3 NANORAY-312 clinical trial in locally advanced head and neck (“H&N”) cancer.

Radiotherapy overview

Radiotherapy (“RT”) is an essential component of cancer care and may be used alone or in combination with other treatments, including surgery, chemotherapy and targeted therapies. RT can cure cancer, prevent its recurrence or stop or slow its growth. Nevertheless, many cancer patients still experience progressive disease, because, among other reasons, they are not able to receive a high enough radiation dose to completely destroy their tumor without resulting in an unacceptable level of damage to surrounding healthy tissues. We believe that by easing this limitation, NBTXR3 has the potential to improve the survival rate for cancer patients.

In developed countries, more than half of cancer patients receive RT as part of their treatment protocol. Currently, 20-25% of cancer patients in China are treated with RT, due in part to a shortage of equipment. In recent years, the government has issued policies aimed at expanding the availability of RT in China. We believe access to RT is improving in China due to policies supporting its use, hospital capability expansion and new training requirements. In 2018, a total of 1.3 million patients received RT in China, an increase of 37% compared to 2015.

NBTXR3 overview

NBTXR3 is an aqueous suspension of functionalized crystalline hafnium oxide nanoparticles designed for injection directly into a solid tumor prior to standard RT. NBTXR3’s approach brings a universal, physics-based mechanism of action to destroy cancer cells from within.

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When NBTXR3 nanoparticles are directly injected into a malignant tumor before standard RT, they are internalized through endocytosis to function as radioenhancers. The nanoparticles contain an inorganic core of crystallized hafnium oxide which has a high electron density, thus allowing the nanoparticles to absorb more energy than would otherwise be absorbed by the surrounding water molecules. Greater energy absorption generates more electrons, and, in turn, more free radicals thereby enhancing damage within the tumor cell and leading to greater cell death. NBTXR3 nanoparticles are pharmacologically inert, meaning that they do not interact with cellular or molecular systems in the absence of ionizing radiation. After radiation exposure, nanoparticles return to their inactive state, meaning that multiple RT procedures can be performed after a single NBTXR3 injection.

NBTXR3 Nanoparticles Enabling Hyper-Focused Radiation Dose Delivery

*Dose enhancement determined by Monte Carlo simulation (CEA Saclay, France).

Preclinical and early clinical data also suggest that the use of NBTXR3 activated by RT could trigger the destruction of metastatic cells through an abscopal effect, and that NBTXR3 could be effective in making tumors visible to the immune system and increasing patient responses to immunotherapy by turning “cold” tumors “hot.”

NBTXR3 received European market approval (CE mark) in 2019 for the treatment of locally advanced soft tissue sarcoma based on the results of a registrational Phase 2/3 clinical trial (Study 301) in patients with locally advanced soft tissue sarcoma of the extremity or trunk wall. Study 301 achieved its primary endpoint with a pathological complete response (<5% viable cancer cells) rate of 16.1% in the NBTXR3 arm compared to 7.9% in the control arm (p=0.0448). In the subgroup of patients with more aggressive disease (histologic grade 2 and 3), a pathological complete response was achieved in 17.1% of patients in the NBTXR3 arm compared to 3.9% in the control arm. Similar rates of SAEs were observed in the NBTXR3 and control arms (39% and 30% respectively), including the rate of postsurgical wound complications, which were the most common treatment-emergent adverse event (9% in both arms). NBTXR3 administration did not show an impact on the severity or incidence of RT-related adverse events.

Head and neck cancer overview

H&N cancers include cancers of the oral cavity, pharynx, larynx, paranasal sinuses, nasal cavity and salivary glands. Tobacco use, heavy alcohol use, human papillomavirus infection, Epstein-Barr virus infection, poor oral hygiene and certain industrial exposures increase the risk of H&N cancer. Globally, the five-year survival rate for patients with H&N cancer is approximately 40-50%.

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In China, we estimate that approximately 90,000 non-nasopharyngeal cancer H&N cancer patients are diagnosed each year. Due to the aging of the population, we believe H&N cancer incidence will continue to grow in China over the coming decade.

Current standard of care for locally advanced H&N cancer

Chemotherapy in combination with concomitant radiation is the current standard of care for inoperable locally advanced H&N cancer. In China, KOL research indicates most patients with inoperable locally advanced H&N cancer are eligible to be treated by RT. This presents limitations in elderly patients, for whom these cancers are more prevalent, due to their reduced ability to withstand chemotherapy and its associated adverse events. Cetuximab and RT can sometimes be offered as an alternative to chemoradiation but has shown limited efficacy in elderly patients. Data presented at the Multidisciplinary H&N Cancers Symposium 2020 showed that elderly patients treated with RT alone or RT plus cetuximab had a median progression-free survival (“PFS”) of 7.3 months. These patients reported poor quality of life due to high unmet medical need as well as limited availability of therapeutic options.

Other solid tumor indications

Nanobiotix is also studying NBTXR3 in other solid tumor types as both a single agent and in combination with programmed cell death protein 1 (“PD-1”) inhibitors and with chemotherapy.

Phase 1 dose escalation and expansion study in head & neck cancer (Study 102)

In October 2021, Nanobiotix presented data at the 2021 Annual Meeting of the American Society for Radiation Oncology. The first analysis of overall survival (“OS”) and progression-free survival (“PFS”) from the ongoing Phase 1 trial of NBTXR3 in elderly and frail locally advanced head and neck squamous cell carcinoma patients ineligible for cisplatin and intolerant to cetuximab (Study 102) demonstrated median OS of 18.1 months and median PFS of 10.6 months in the evaluable population (n=41) from the dose expansion part of the study. NBTXR3 administration was feasible and well-tolerated overall. A total of 8 Grade 3-4 NBTXR3-related adverse events (“AEs”) were observed in 8 patients. Of these AEs related to NBTXR3, 5 serious adverse events (“SAEs”) were observed including dysphagia, sepsis, soft tissue necrosis, stomatitis, and tumor hemorrhage. Of the SAEs, one death from sepsis assessed by the investigator as possibly related to NBTXR3, radiotherapy, and cancer was observed.

Phase 3 registrational trial (NANORAY-312)

Based on the preliminary Phase 1 data demonstrated in Study 102, Nanobiotix has designed a global pivotal Phase 3 clinical trial of NBTXR3 in elderly patients with locally advanced H&N squamous cell carcinoma (“HNSCC”) who are ineligible for platinum-based chemotherapy. Nanobiotix initiated this clinical trial by enrolling the first patient in January 2022.

NBTXR3 in immuno-oncology

Nanobiotix has generated preclinical data demonstrating that RT-activated NBTXR3 resulted in greater tumor cell death than RT alone due to higher tumor recognition by the patient’s immune system.

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In March 2021, Nanobiotix presented preclinical data at the American Association for Cancer Research Annual Meeting which demonstrated that a combination therapy of RT-activated NBTXR3 and checkpoint inhibitors (anti-PD-1, anti-LAG3, anti-TIGIT) significantly promoted the proliferation of CD8+ T-cells and improved local and distal tumor control, as well as increased survival rate. Moreover, survivor mice were immune to re-injections of tumor cells and maintained significantly higher levels of memory T-cells compared to control mice. This combination therapy approach also augmented antitumor response in abscopal tumors. These data suggest that NBTXR3 could modulate the immunogenicity of cancer tumor cells and that NBTXR3 could potentially be used in combination with existing immunotherapies.

Phase 1 basket trial (Study 1100)

Nanobiotix is currently conducting Study 1100, a Phase 1 prospective, multi-center, open-label, non-randomized basket trial of NBTXR3-enhanced RT in combination with anti-PD-1 immune checkpoint inhibitors nivolumab or pembrolizumab in patients with inoperable local-regional recurrent or metastatic HNSCC eligible for re-irradiation and patients with lung or liver metastases from any primary cancer that is amenable to anti-PD-1 therapy. In October 2021, Nanobiotix presented updated data from Study 1100 at ASTRO. Disease control rate in 16 evaluable patients was 81% and 73% within a subgroup of patients with prior primary or secondary resistance to anti-PD-1. In the evaluable patient population, 3 complete responses and 5 partial responses were reported. Some patients in the study showed delayed tumor response and/or abscopal effect, suggesting NBTXR3 may potentially prime an immune response. The results suggest that NBTXR3 administration was feasible and well-tolerated.

Study 1100: Best Observed Target Lesion Response (Evaluable Population n=16)

Nanobiotix has announced plans to assess NBTXR3 in combination with several immune checkpoint inhibitors, including anti-PD-1, anti-PD-L1 and anti-CTLA-4 therapeutics in patients across various indications, including inoperable, locally advanced HNSCC, recurrent or metastatic HNSCC, advanced solid tumors, and lung or liver metastases from solid malignancies.

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Our strategy to seek regulatory approval of NBTXR3 in China

We believe NBTXR3 has the potential to be broadly applicable against solid tumors where RT can be used. We may join five of Nanobiotix’s global registrational trials by enrolling patients in China. We believe that enrolling patients in China in global Phase 3 clinical trials may expedite the global development program as well as support regulatory approval in China. The initial cancer indication we plan to pursue for NBTXR3 in China is locally advanced HNSCC as part of the ongoing Phase 3 NANORAY-312 clinical trial. We plan to initiate the China portion of the Phase 3 NANORAY-312 clinical trial in the second half of 2022. Additionally, we plan to join potential future pivotal studies in other solid tumor indications. We believe that NBTXR3 activated by RT has the potential to modulate antitumor immune response, and we may join Nanobiotix’s future registrational trials of NBTXR3 in combination with anti-PD-1 antibodies for the treatment of certain solid tumors. We believe NBTXR3 has the potential to be used in the treatment of up to 925,000 patients in China each year across our current potential solid tumor target indications, including an estimated 25,000 patients with locally advanced H&N cancer, up to 150,000 patients with other solid tumors (with or without additional chemotherapy), and up to 750,000 patients in combination with radiotherapy and immunotherapy.

Infigratinib, a targeted FGFR1-3 inhibitor for the potential treatment of cholangiocarcinoma (“CCA”) and gastric cancer

We have partnered with BridgeBio Pharma, Inc. and its affiliate QED Therapeutics, Inc. (“QED”) to develop and commercialize infigratinib in Mainland China, Hong Kong and Macau for FGFR-driven tumors. Infigratinib is an orally administered, ATP-competitive, FGFR1-3 tyrosine kinase inhibitor in development for the treatment of individuals with FGFR-driven diseases, including CCA, urothelial carcinoma and achondroplasia. Infigratinib is approved in the United States for the treatment of patients with previously-treated, unresectable locally advanced or metastatic CCA harboring an FGFR2 fusion or rearrangement. Infigratinib has also shown clinical activity in advanced and/or metastatic urothelial carcinoma with FGFR3 genomic alterations, and FGFR1-amplified lung cancer. We believe infigratinib has the potential to become an important treatment option for patients with FGFR-driven cancers, including those with high prevalence rates across Asia, such as gastric and related cancers.

Incidence and Mutation Rate of CCA and Gastric Cancer in the United States and China

United States China

CCA disease overview

CCA is a highly invasive, malignant carcinoma that originates from bile duct epithelial cells. A number of factors associated with liver damage, such as biliary stone, exposure to toxins and hepatitis B and hepatitis C virus infections, increase the risk of developing CCA. Patients diagnosed with CCA have a one-year survival rate of 50% and a five-year survival rate of approximately 10% with few therapeutic options. First-line therapy is limited to cytotoxic chemotherapy with agents such as gemcitabine and cisplatin, gemcitabine and oxaliplatin, and fluorouracil monotherapy. PFS with gemcitabine and cisplatin combination therapy is approximately 8.0 months. PFS after second line chemotherapy is only 2.7 months.

Approximately 72,000 patients in China are diagnosed with intrahepatic CCA annually. Given the severity of the disease, the lack of highly effective therapies and the high prevalence rate in China, there is an urgency to bring innovative treatments to this patient population. Approximately 14-17% of patients with intrahepatic CCA, or 10,000 to 12,000 patients in China, have FGFR2 gene fusions.

Gastric cancer overview

Gastric cancer develops from the cancerous transformation of cells that line the stomach. There are geographic and ethnic differences in the incidence of gastric cancer around the world, suggesting that environmental factors, including Helicobacter pylori infection, salt intake and concentrated use of nitrates as food preservatives, have an important role in its development.

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Gastric cancer is the second most common type of cancer in China and the third leading cause of cancer-related deaths. Worldwide, there are approximately 1.2 million newly diagnosed cases of gastric cancer yearly and an estimated 480,000 newly diagnosed cases annually in China. The five-year survival rate for gastric cancer in China is 27.4%. Globally, the five-year survival rate for gastric cancer patients with distant metastatic disease is 6%.

Complete surgical removal of the tumor in early-stage disease can be curative. However, by the time of diagnosis, the majority of patients have advanced disease and are treated with systemic chemotherapy. First-line chemotherapy is typically with cytotoxic agents used in combination, such as fluorouracil, cisplatin, epirubicin and oxaliplatin.

Approximately 22,000 patients with gastric cancer in China have tumors with FGFR2 gene amplification. FGFR1, FGFR2 and FGFR3 are tyrosine kinase receptors that play a pivotal role in the regulation of cell growth, with important functions in tissue repair, angiogenesis and inflammation in adults. However, given the role in these functions, FGFR dysregulation is believed to be involved in cancer pathogenesis. Genetic alterations in the FGFR pathway have been found in over 7% of all tumor types, making it one of the most frequently altered pathways. Patients with gastric cancer expressing FGFR2 gene amplification have significantly reduced survival rates compared to other patients with gastric cancer. We believe that FGFR inhibitors have the potential to provide therapeutic benefit to patients in China.

Infigratinib development path

Infigratinib has demonstrated encouraging clinical activity in chemotherapy-refractory CCA with FGFR2 fusions, advanced urothelial carcinoma with FGFR3 genomic alterations, and FGFR1-amplified lung cancer. In May 2021, the FDA approved infigratinib for the treatment of patients with previously-treated, unresectable locally advanced or metastatic CCA harboring an FGFR2 fusion or rearrangement under the accelerated approval program. QED is currently studying infigratinib in multiple clinical trials, including the Phase 3 PROOF-301 clinical trial in first-line CCA patients with FGFR2 gene fusions/translocations and a Phase 3 clinical trial in urothelial cancer patients with a targetable FGFR3 alteration. We licensed infigratinib from QED as part of our collaboration with BridgeBio for development and commercialization in Mainland China, Hong Kong and Macau. We plan to pursue local development strategies in China with a focus on gastric cancer, with the possibility of leading infigratinib’s global development in gastric cancer indications. We initiated a Phase 2a proof of concept clinical trial in patients with locally advanced or metastatic gastric cancer or gastroesophageal junction adenocarcinoma with FGFR2 genetic amplification and other solid tumors with FGFR alterations in August 2021. Additionally, we plan to join QED’s ongoing Phase 3 PROOF-301 clinical trial in first-line CCA in the second half of 2022 and we have received clearance from the NMPA to initiate the China portion of this trial. We also intend to explore development and patient access strategies in our territories for infigratinib in previously treated, unresectable locally advanced or metastatic CCA with FGFR2 fusion or other rearrangement (second-line CCA).

Results from phase 2 and phase 1 clinical trials

A Phase 2 global, open-label, single arm clinical trial of infigratinib was conducted by QED in advanced CCA patients with FGFR2 fusions or translocations who previously failed gemcitabine-based chemotherapy. The primary endpoint was overall response rate. A final analysis conducted in 108 patients demonstrated an overall response rate of 23%, most of which were partial responses. One patient had a complete response. Median PFS was 7.3 months and median OS was 12.2 months.

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Clinical Activity of Infigratinib in Advanced CCA

≤1 previous line of therapy (n=50) 34.0%

≥2 previous lines of therapy (n=58) 7.4%

BICR-assessed best overall response

* BICR=blinded independent central review

Infigratinib-associated toxicity was manageable, with expected on-target class effects, which include hyperphosphatemia, the most common adverse event reported in trials of infigratinib. Development of hyperphosphatemia in clinical trials of infigratinib was generally reversible and managed using standard phosphate binders.

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Treatment-Emergent Adverse events reported in Infigratinib Phase 2 clinical trial in advanced CCA: any grade AEs > 20%

Number of Patients (%) Any Grade

Similar antitumor activity was reported from a Phase 1 open label trial of infigratinib conducted by Novartis AG in 67 patients with advanced, unresectable or metastatic urothelial carcinoma. In this trial, patients had an objective response rate of 25.4% when treated with infigratinib as first-line or later therapy. In addition, one patient achieved a complete response.

Infigratinib has been studied in over 700 patients to date. It has shown acceptable tolerability with expected on-target class effects, which include hyperphosphatemia, the most common adverse event reported in trials of infigratinib. Most patients with hyperphosphatemia have no symptoms. However, in rare cases, some patients develop calcium deposits in soft tissue. Hyperphosphatemia is believed to be a class-specific, mechanism-based toxicity caused by FGFR inhibition leading to dysregulation of FGF23, resulting in phosphorus retention. Development of hyperphosphatemia in clinical trials of infigratinib was generally reversible and managed using standard phosphate binders.

Our strategy for the development of infigratinib in gastric cancer and CCA in China

We initiated a Phase 2a proof of concept trial in China for FGFR2 amplified gastric cancer and other solid tumors with FGFR alterations in August 2021. The results of the Phase 2a trial will inform our development strategy moving forward. As part of our Phase 2a trial, we are including a cohort of patients with tumors that have FGFR alterations that are not related to gastric cancer, gastroesophageal junction cancer, urothelial cancer or CCA. The results of this cohort may guide our further development strategy in tumor-agnostic treatment.

Additionally, we plan to join QED’s ongoing global Phase 3 PROOF-301 clinical trial of infigratinib in first-line locally advanced or metastatic CCA patients with FGFR2 gene fusions or translocations by enrolling patients in China in the clinical trial.

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We also intend to explore development and patient access strategies in our territories for infigratinib in second-line CCA.In December 2021, infigratinib was approved by the Health Commission and Medical Products Administration of Hainan Province, under the special Named Patient Program (“NPP”), for the treatment of patients with previously treated, unresectable locally advanced or metastatic CCA with a FGFR2 fusion or other rearrangement. The special NPP was enacted by the State Council of PRC as a pilot program implemented in the Bo’ao Lecheng International Medical Tourism Pilot Zone to accelerate patient and physician access to urgently needed medicines that are approved in certain jurisdictions, but not yet approved in Mainland China.

BBP-398, a SHP2 inhibitor for the potential treatment of MAPK-driven solid tumors

BBP-398 is an orally available allosteric inhibitor of SHP2, a tyrosine phosphatase that plays a key role in the RTK-mediated MAPK signal transduction pathway. We have partnered with BridgeBio Pharma, Inc. and its affiliate Navire Pharma, Inc. (“Navire”) to develop and commercialize BBP-398 in Greater China, Thailand, Singapore and South Korea. We plan to develop BBP-398 in combination with an epidermal growth factor receptor (“EGFR”)-inhibitor and in combination with PD-1 inhibitors for the treatment of drug-resistant and other hard-to-treat MAPK-driven solid tumors, including non-small-cell lung carcinoma (“NSCLC”). We received clearance from the NMPA to enroll patients in China in a local Phase 1 clinical trial of BBP-398 and a local Phase 1a/1b clinical trial of BBP-398 in combination with osimertinib.

NSCLC disease overview

An estimated 1.8 million people die of lung cancer each year. Lung cancer is the leading cause of cancer-related death, accounting for approximately 18% of all cancer deaths globally. NSCLC accounts for 80% to 85% of lung cancer cases. There are an estimated 670,000 patients diagnosed with NSCLC each year in China.

Genetic profiling of tumors has identified a number of genes that are altered in NSCLC, including MAPK, which has been identified as one of the most important signaling pathways in promoting tumor growth in many types of cancer. Upregulation of MAPK signaling is a common mechanism of resistance to targeted therapies. SHP2 is a protein tyrosine phosphatase that positively regulates MAPK signaling. Additionally, SHP2 has a role in regulating immune checkpoint inhibition, whereby tumors can suppress patients’ anti-tumor immune responses.

Signaling Through Receptor Tyrosine Kinases and RAS Converge on SHP2

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NSCLC current standard of care

Targeted therapies developed for the proteins encoded by some of the genes most commonly upregulated in NSCLC, such as EGFR and the anaplastic lymphoma kinase gene (“ALK”), have been approved and are now part of the standard of care. In China, approximately 36-39% of NSCLC cases contain mutations in EGFR, double the rate found in the United States. EGFR-targeted therapies such as osimertinib lead to clinical benefit in more than 65% of patients treated. However, almost all of these patients will acquire resistance to these therapies. Up to two-thirds of NSCLC patients who do not have EGFR or ALK gene alterations or who develop resistance to targeted therapies have tumors that express PD-L1 and are candidates for checkpoint inhibitor therapies. Despite the availability of targeted agents and immunotherapies, the prognosis in NSCLC remains poor, with an overall five-year survival rate for all patients diagnosed with NSCLC of 19%.

One method by which tumors develop resistance to therapeutic inhibitors of kinases such as EGFR is by shifting growth factor signaling to an alternate receptor. However, signaling from many of these pathways converges on SHP2, making it a highly attractive target for oncology drug development. Inhibition of SHP2 may be an effective way to restore sensitivity to kinase inhibitors by blocking signaling through common resistance pathways as confirmed by cellular and animal model experiments. We believe an inhibitor of SHP2 has the potential to be used as a targeted cancer therapy both as a monotherapy as well as in combination with multiple therapies targeted against the RAS pathway or receptor tyrosine kinases, as well as in combination with immunotherapies including PD-1 inhibitors. We believe that BBP-398’s favorable tolerability profile with no major overlapping adverse events with key targeted therapies positions this agent as an attractive combination partner.

BBP-398 development path

In preclinical studies, BBP-398 blocked RAS and MAPK signaling and inhibited cell growth of tumor cell lines containing EGFR amplification and KRAS activating mutations. As a monotherapy in mouse xenograft models, BBP-398 prevented tumor growth of EGFR amplified and KRAS-mutant tumors. In a model of EGFR tyrosine kinase inhibitors (“TKI”)-resistant NSCLC, neither IACS-13909, a preclinical compound with a profile similar to BBP-398, nor osimertinib led to tumor shrinkage in most mice. However, the combination of IACS-13909 with osimertinib led to tumor shrinkage in all treated mice.

Our partner Navire is currently dosing patients in a Phase 1/1b clinical trial of BBP-398 in approximately 60 patients with advanced solid tumors. Navire has indicated its plans to treat expansion cohorts in patients with NSCLC with KRAS or EGFR mutations and in other solid tumor types with KRAS mutations or MAPK pathway alterations.

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Our clinical development strategy for BBP-398 in China

We intend to develop BBP-398 in China as part of a global development plan in partnership with Navire. Our strategy is to initially conduct an abbreviated monotherapy dose escalation trial in China followed by a monotherapy expansion arm. We then plan to lead a local trial of BBP-398 in combination with osimertinib in NSCLC. We believe the higher rate of EGFR mutations in China compared to the United States confers key advantages and we plan to leverage the anticipated large addressable patient population and augmented enrollment capabilities to inform the development strategy of BBP-398 in our licensed territories. We believe there are approximately 250,000 patients diagnosed with EGFR-mutant NSCLC in China each year.

We also plan to conduct a local Phase 1/2a trial in combination with a PD-1 inhibitor in solid tumor indications, leveraging the unique PD-1 landscape in China to seek out opportunities that otherwise may be inaccessible within the United States and other major markets. Key market advantages in China include a wide variety of potential PD-1 combination partners, a differentiated set of indications for which PD-1s are approved or in development in China and differences in epidemiology of target indications. We have prioritized indications for development based on strong scientific rationale for BBP-398/PD-1 combination. We believe there are approximately 900,000 PD-L1 positive patients (defined as those with PD-L1 expression >1%) across select high-incidence tumor types in which PD-1s are approved in China. SHP2i has the potential to impact the tumor cells directly as well as reshape the tumor microenvironment through effects on T-cells and macrophages, among other factors. We have selected several tumor types with evidence of SHP2i impacting both tumor cells and microenvironment for inclusion in an exploratory Phase 1 dose escalation trial. We may also in the future join global combination trials with inhibitors of KRAS, BRAF, MEK or CDK4/6 conducted by our partner Navire.

We received clearance from the NMPA to enroll patients in China in a local Phase 1 clinical trial of BBP-398 and a local Phase 1a/1b clinical trial of BBP-398 in combination with osimertinib.

LYR-210 for the potential treatment of chronic rhinosinusitis

We have partnered with Lyra Therapeutics, Inc. (“Lyra”) to develop and commercialize LYR-210 in Greater China, South Korea, Singapore and Thailand. LYR-210 is an anti-inflammatory implantable drug matrix that is designed to consistently and locally elute mometasone furoate (“MF”) to inflamed mucosal sinus tissue for up to six months with a single administration. Chronic rhinosinusitis (“CRS”) is an inflammatory disease of the paranasal sinuses which leads to debilitating symptoms and significant morbidities. CRS constitutes a substantial disease burden in Asia, with 88 million cases in Chinese adults ages 18-74 alone, an estimated 3.4 million of whom have failed currently available medical management. In December 2020, Lyra announced positive topline results from its Phase 2 LANTERN clinical trial demonstrating statistically significant improvement in symptom scores. Lyra has announced the initiation of its Phase 3 ENLIGHTEN I clinical trial of LYR-210 in adult, surgically naïve CRS patients and plans to initiate ENLIGHTEN II, the second Phase 3 clinical trial, mid-year 2022. We plan to join the LYR-210 clinical development program by enrolling patients in China in one of Lyra’s planned pivotal Phase 3 clinical trials.

CRS disease overview

CRS is an inflammatory disease of the paranasal sinus in which the mucosa lining the sinuses become swollen and inflamed, leading to significant patient morbidities. Inflammation may be caused by infections, allergies or environmental factors, as well as structural issues such as blockages of an ostium. If the sinus drainage pathways become blocked, normal mucus drainage is prevented and damage to ciliary function may occur. The four cardinal symptoms of CRS are nasal obstruction and congestion, facial pain and pressure, nasal discharge and olfactory loss (loss of sense of smell). Other symptoms include chronic headaches, bodily pain, fatigue, sleep deprivation, depression and recurrent infections. CRS may be diagnosed when two of the four cardinal symptoms persist for 12 weeks or longer and when inflammation is confirmed via endoscopy or CT scan.

CRS has two phenotypes: CRS with nasal polyps, which are teardrop-shaped benign masses arising from the mucosa, and CRS without nasal polyps, with the non-polyp form representing approximately 70% to 90% of CRS patients. Patients with polyps develop non-cancerous polyps on the chronically inflamed surfaces, but both subgroups typically share the same symptoms and level of severity. Currently, the majority of therapies target CRS patients with polyps and there are no approved treatments for CRS patients without polyps who have failed medical therapy, creating a vast untapped market opportunity for a more effective treatment solution.

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Current standard of care for CRS

Current treatments are directed towards managing the symptoms of CRS through a combination of medical management and surgical intervention techniques. The first line of therapy is medical management involving nasal saline irrigation, intranasal corticosteroid sprays and oral steroids. Antibiotics are employed for patients with an active sinus infection. It is estimated that at least 40% of CRS patients in China who are seen by ENT physicians and receive medical management remain symptomatic. In addition to its use as a first line of therapy, medical management is utilized as a maintenance therapy for patients who receive surgery.

CRS patients whose symptoms persist despite medical management are generally recommended to undergo functional endoscopic sinus surgery (“FESS”) or balloon sinus dilation (“BSD”), or both. FESS is a highly invasive surgery performed in the operating room, under full anesthesia, to open the blocked sinus pathways by removing inflamed tissue and bone. Approximately 65% of patients have recurrent symptoms post-FESS and up to 20% require a revision surgery. BSD is a less severe form of endoscopic sinus surgery, often used in combination with FESS, in which small balloon catheters are inserted and inflated to drain the large nasal sinuses. Although FESS and BSD can improve symptoms and quality of life, limitations remain. Neither corrects the underlying cause of the inflammation and patients who undergo either or both procedures often experience significant pain and require continued post-operative medical therapy to maintain improvements, with a high incidence of repeat symptoms and surgeries. Physicians report that many patients, when presented with sinus surgery as a treatment option, opt to forego the procedure, as some patients regard the often temporary benefits provided by surgery as not worth the expense, recovery time or use of general anesthesia.

For refractory patients with nasal polyps, who remain symptomatic following surgery, certain non-surgical options are available. A steroid-eluting implant that continuously delivers three months of low-dose MF was approved in the United States, although not in China, to treat adults with nasal polyps. However, this stent only has a two- to three-month elution profile, requiring frequent visits to an ENT’s office. Monoclonal antibodies (“mAbs”), targeting type 2 inflammation, including Dupixent, Xolair and Nucala, have been approved in the United States for the treatment of adults with nasal polyps. Dupixent and Xolair have been approved in China for atopic dermatitis and for asthma, respectively, and, while not approved in China for polyps, they have been included in the treatment guidelines for CRS with nasal polyps. Nasal polyps are a condition of local inflammation and physicians prefer to treat them locally before moving on to systemic treatments, due in part to limited data regarding long-term safety of systemic biologics in the treatment of CRS. In addition to the limitations described, these treatment options are only used for the treatment of nasal polyps, leaving non-polyp patients who are refractory with no approved treatment options.

LYR-210 overview

We believe LYR-210, if successfully developed and approved, has the potential to become a treatment for patients that have failed medical management as an alternative to surgery for CRS patients, both with and without polyps. We believe it is the only product candidate that may provide up to six months of local delivery of anti-inflammatory medication with a single administration. LYR-210 is designed to enhance patient comfort and physician experience and to eliminate patient compliance issues associated with other CRS treatments, such as intranasal steroid sprays. The brief, non-invasive, in-office procedure allows for implantation without the need for surgery.

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Illustration of Placement of LYR-210 in Middle Meatus

LYR-210 is an investigational local drug delivery system based on Lyra’s XTreoTM platform, which is a proprietary drug delivery technology designed to locally and continuously deliver drugs to affected tissue over a sustained period of time from a single administration. It is designed to fit within, and conform to, the confined space of a surgically-naïve patient’s middle meatus, a space that plays a fundamental role in drainage of the paranasal sinuses. LYR-210 consists of MF, which has been an active ingredient in a number of FDA-approved drugs. MF is embedded in biocompatible polymers to aid in the controlled and sustained delivery of the active ingredient to the sinonasal mucosal tissue from a single drug administration. LYR-210 has a tubular braid configuration with a uniform diamond pattern throughout and is 13mm in diameter and 10mm in length in the unconstrained state. It has elastic properties to promote patient comfort and is designed to be self-retaining against the mucosal tissue to allow effective drug transfer.

LYR-210 is intended to be administered bilaterally into the non-operated middle meatus by an ENT physician under endoscopic visualization via a provided, single-use applicator. It is designed for office-based administration performed with topical anesthesia. Once administered, LYR-210 is designed to gradually release MF to the inflamed mucosal tissue for up to six months from a single administration. LYR-210 can be removed at six months or earlier at the physician’s discretion using standard instruments and, if needed, replaced with a new LYR-210. LYR-210 is made with bioresorbable polymers that, if left in place, gradually dissolves over time.

LYR-210 development path

Lyra’s Phase 2 LANTERN clinical trial was designed to inform a pivotal Phase 3 program for LYR-210. Lyra has announced that the first patient was dosed in its first Phase 3 clinical trial, ENLIGHTEN I, in February 2022. The second Phase 3 trial, ENLIGHTEN II is anticipated to commence mid-year 2022.

Results from phase 2 LANTERN clinical trial

Lyra presented positive topline and full results from its Phase 2 LANTERN clinical trial in December 2020 and April 2021. The LANTERN clinical trial was a randomized, sham procedure-controlled, patient-blinded study that evaluated adult patients with CRS who had failed previous medical management and had not undergone FESS. The clinical trial enrolled 67 patients, with enrollment curtailed due to the COVID-19 pandemic, across Australia, Czech Republic, New Zealand and Poland. The clinical trial consisted of three arms with a 1:1:1 randomization: an experimental arm with bilateral placement of 2,500 μg of LYR-210; an experimental arm with bilateral placement of 7,500 μg of LYR-210; and a control arm with bilateral sham procedure only. Patients were also supplied with saline for daily nasal irrigation treatment during the course of the treatment period.

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Results from 4 Cardinal Symptoms Composite Score (4CS)

The primary endpoint of the clinical trial was the change from baseline in the 7-day average scores of the 4 cardinal symptoms composite score (“4CS”) at week 4. The 4CS is comprised of the four cardinal symptoms of CRS, as described earlier, that are scored 0-3 with a total score of up to 12. At the 7,500 μg dose, LYR-210 achieved statistically significant improvement in the 4CS composite score in favor of the treatment arm at weeks 16 (-1.47) (p=0.021), 20 (-1.61) (p=0.012) and 24 (-1.64) (p=0.016).

Results 22-Item Sino-Nasal Outcome Test (SNOT-22)

Mean change from baseline (CFBL) in SNOT-22 total score. Data represents LSM. P<0.05 is considered statistically significant to control MCID = Minimal Clinically Important Difference. 1Hopkins et al., Clinical Otolaryngology 2009, 34, 447–454.

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The secondary endpoints of the LANTERN clinical trial included the Sino-Nasal Outcomes Test score (the “SNOT-22 score”), symptom improvement at week 24, sinus imaging to assess reduction in inflammation, time to treatment failure, reduction in inflammation, frequency of exacerbations and plasma PK. A single administration of LYR-210 7500 μg achieved statistically significant improvement in the SNOT-22 score in favor of the treatment arm at weeks 8 (-12.2) (p=0.039), 16 (-15.0) (p=0.008), 20 (-18.4) (p=0.001) and 24 (-19.0) (p=0.001). Furthermore, all patients, both with and without polyps, receiving the 7500 μg dose of LYR-210 achieved the minimal clinically important difference (“MCID”) of 8.9 points for SNOT-22 by week 24.

LYR-210 was observed to be well-tolerated at all doses in the study, and no treatment related SAEs were reported. Adverse events were generally mild to moderate in nature and in line with the known safety profile of MF. While there was one subject in the 2500 μg group that experienced an SAE of increased viscosity of upper respiratory secretion, treatment-related adverse events in the control and 7500 μg groups occurred at comparable rates. LYR-210 had high levels of intranasal retention out to 24 weeks. There were no adverse events associated with the matrices that were dislodged.

In the LANTERN 24-week post-treatment follow-up, approximately 50% of patients experienced a durable response post-removal of LYR-210 (7500 μg), with no worsening of 4CS scores from Week 24, compared to approximately 90% of control patients who either experienced a worsening of 4CS scores or required a rescue treatment. LYR-210 continued to show strong safety post removal with no increased incidence of treatment related AEs.

Our strategy to seek regulatory approval in China

We plan to join the LYR-210 clinical development program by enrolling patients in China in one of Lyra’s planned pivotal Phase 3 clinical trials.

Inflammatory disease

Omilancor for the potential treatment of inflammatory bowel disease

We have partnered with Landos BioPharma, Inc. (“Landos”) to develop and commercialize omilancor in Greater China, Cambodia, Indonesia, Myanmar, Philippines, Singapore, South Korea, Thailand, and Vietnam in inflammatory bowel disease (“IBD”). Omilancor is an orally administered, gut-restricted small molecule activator of the lanthionine synthetase C-like protein 2 (“LANCL2”) pathway, which is upstream of multiple key regulators of inflammation that can intercept autoimmune disease at multiple levels. Activation of LANCL2 enhances CD25/STAT5 signaling and increases oxidative metabolism to support the anti-inflammatory functionality of regulatory T-cells while decreasing TNF-α and IFN-γ production. IBD can be further categorized into ulcerative colitis (“UC”) and Crohn’s disease (“CD”). Landos has announced plans to initiate a Phase 2b clinical trial of omilancor in moderate to severe UC patients. Should this trial be successful, we plan to join the omilancor development program by enrolling patients in China in Landos’s potential future global pivotal trials.

IBD overview

IBD is a chronic autoimmune inflammatory condition that primarily affects the intestines and colon. It is believed to be caused by a mix of genetic and environmental factors in which immune response is triggered from various potential stimulants such as bacteria crossing the intestinal lumen barrier. Diet and lifestyle are hypothesized to be key drivers of IBD, and IBD produces a variety of signs and symptoms ranging from mild to severe that negatively impact quality of life. The most common symptoms include abdominal pain, diarrhea, weight loss and anemia. IBD can lead to severe adverse outcomes including colectomy, disability and colorectal cancer. We estimate that there are 590,000 IBD patients in China.

IBD can be further classified into UC, which affects the large intestine (colon) and rectum, and CD, which can affect any part of the gastrointestinal tract but most commonly affects the small bowel. UC is more prevalent in ages 30-40 while CD is more prevalent in ages 20 to 30.

Both UC and CD can be classified as mild, moderate or severe, with treatments differing based on severity. In China, approximately 35% of active UC patients are classified as mild, 43% as moderate and 22% as severe. Additionally, 20% of patients experience at least one severe exacerbating symptom that requires hospitalization. In CD, approximately 30% of patients are classified as moderate and 17% as severe.

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Current standard of care for IBD

The approach to diagnosis in China is similar to the United States, although the diagnosis rate is lower. A combination of fecal culture and imaging are used, and endoscopy and histopathology are deployed if the diagnosis is unclear after six months. The median time from symptom onset to diagnosis is three months for UC patients and 10 months for CD patients, and misdiagnosis is common. However, diagnosis has been improving in China, and there are now specialty medical centers established to focus on IBD, with additional treatment centers expected to be established in the future. China’s IBD treatment guidelines were more recently updated in 2018 and reference global guidelines. The treatment paradigm in China is similar to that in the United States. For mild UC patients, aminosalicylic acid (“ASA”) is commonly used for both induction and maintenance, while oral steroids are used for induction if ASA is not effective. Treatment of moderate UC starts with the same path as mild UC, and progresses to thiopurines if oral steroids are not effective, and chronic use may lead to multiple significant side effects. Infliximab can be used if thiopurines fail. In severe UC, IV steroids are used for the induction phase and can progress to infliximab if IV steroids are not effective. Other alternatives include cyclosporine, tacrolimus or surgery.

Similar to UC, mild CD is most often treated with ASA. Moderate CD is treated with oral steroids or thiopurines if oral steroids are not effective. Infliximab or adalimumab can be deployed if thiopurines are ineffective. In severe CD, surgery is recommended along with the aforementioned therapies.

While many therapies exist for UC and CD, unsatisfactory efficacy, side effects and inconvenient administration leave significant unmet need. There is a therapeutic gap for patients with mild to moderate disease. For these patients, steroids are not recommended for maintenance therapy due to the significant side effects, and ASA may be sub-optimal, but progressing to thiopurines may not offer an attractive benefit / risk profile. Certain biologics are associated with potentially serious adverse events, including leukopenia, immunosuppression, cancer, infection and death. We believe the gut-restrictive nature of omilancor and its potential to have a more benign safety profile than systemic biologics may result in a differentiated safety profile and could make it an important therapeutic option.

Omilancor development path

Landos has completed the induction phase of a Phase 2 clinical trial of omilancor in patients with mild to moderate UC in the United States, Russia and Europe. Omilancor was observed to be gut-restricted and well-tolerated in the Phase 2 clinical trial. A positive trend was observed in absolute clinical remission rates following treatment with omilancor. Based on these data, Landos has announced that it expects to initiate a Phase 2b clinical trial in moderate to severe UC.

Results from phase 2 clinical trial in UC

Landos announced data from their Phase 2 clinical trial in mild to moderate UC in January 2021. The trial was a randomized, placebo-controlled, double-blind, clinical trial of 198 patients across 53 sites in the United States, Europe and Russia. The trial showed a 12-week clinical remission rate of 30.3% in the 500mg cohort and 31.8% in the 1000mg cohort compared to placebo remission rate of 22.7%. Remission was defined by the 3-component modified Mayo Score, consisting of a rectal bleeding subscore of 0, a stool frequency subscore of 0 or 1, and an endoscopic subscore of 0 or 1. Placebo-adjusted clinical remission rates were 9.1% and 7.6% for the 1000mg and 500mg dose groups, respectively, which is consistent with certain currently approved agents. Omilancor was well-tolerated with an adverse effect profile similar to placebo.

Placebo (n = 66) Omilancor 500 mg (n = 66) Omilancor 1000 mg (n = 66)

Results were also analyzed in a more moderate subset of patients, defined as having a Mayo score equal to or greater than 7 at baseline. Placebo-adjusted clinical remission rates were 11.5% and 8.7% for the 1000 (n=47) and 500 mg (n=44) dose groups, respectively, as compared to placebo (n=50). In a small subset of biologic experienced patients, positive placebo-adjusted remission trends were also observed (66% and 33% in the 1,000 (n=3) and 500 mg (n=3) cohorts, respectively, as compared to placebo (n=3, 0%)).

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In May 2021, Landos initiated a Phase 2 clinical trial in moderate to severe CD. In January 2022, Landos halted further enrollment in this trial for a number of reasons, including low enrollment, and will evaluate reinitiating clinical development in CD pending results of the expected Phase 2b trial in moderate to severe UC.

Our strategy to seek regulatory approval of omilancor in China

Should omilancor advance into Phase 3 studies, we plan to join Landos’s potential future global pivotal trials of omilancor by opening sites and enrolling patients in China.

NX-13 for the potential treatment of IBD

NX-13 is an oral, gut-restricted small molecule targeting the novel NLRX1 pathway. NX-13 works to decrease inflammasome activity and reduce reactive oxygen species, resulting in reduced differentiation of effector CD4 T-cells as well as promoting maintenance of intestinal barrier integrity. NX-13 has the potential to target moderate to severe UC and CD. Landos announced positive results from a Phase 1 trial of NX-13 in healthy volunteers in March 2021. NX-13 was shown to be well-tolerated with no reported SAEs. All primary and secondary endpoints were met. Landos initiated a Phase 1b study in patients with UC in April 2021.

Our strategy to seek regulatory approval in China

Should NX-13 advance into Phase 3 studies, we plan to join Landos’s potential future global pivotal trials of NX-13.

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Respiratory

Sisunatovir for the potential treatment of respiratory syncytial virus (“RSV”)

We have partnered with ReViral Ltd. (“ReViral”) to develop and commercialize sisunatovir in Mainland China, Hong Kong, Macau and Singapore. Sisunatovir is a highly potent, selective, orally administered fusion inhibitor designed to block RSV replication by inhibiting F-protein mediated fusion with the host cell. RSV is a respiratory pathogen that can lead to severe and life-threatening lower respiratory tract infections (“LRTIs”) in high-risk populations, including infants, immunocompromised individuals and the elderly. RSV constitutes a substantial disease burden, affecting approximately 64 million people and causing approximately 160,000 deaths globally each year. In China, RSV is the leading pathogen causing acute respiratory tract infection (“ARTI”), particularly in infants and young children. RSV is common in the Chinese pediatric patient population and is the major cause of viral community-acquired pneumonia (“CAP”), especially in the first year of life. Currently, there are no effective therapeutic treatment options for patients who develop RSV infection. We believe there is substantial unmet medical need for efficacious RSV treatments for high-risk populations in Asia. ReViral is currently conducting a Phase 2 clinical trial of sisunatovir in infants hospitalized due to RSV-LRTI. ReViral has also indicated plans to study sisunatovir in adult patients with RSV infections who are at risk of severe outcomes, including the elderly and adult patients with chronic obstructive pulmonary disease, asthma and cardiac failure. Should these clinical trials be successful, ReViral intends to initiate global pivotal Phase 3 clinical trials, and we anticipate joining these potential future global pivotal clinical trials by enrolling patients in China.

RSV disease overview

RSV is an enveloped virus with an RNA genome that encodes for 11 viral proteins, including 3 surface glycoproteins, fusion (F) protein, G glycoprotein and small hydrophobic protein. RSV is highly infectious and is transmitted through respiratory secretions, droplets or contaminated surfaces. RSV causes annual outbreaks of respiratory tract disease around the world. Nearly all children have been infected with RSV by the age of 2. Infection does not result in sustained immunity, and RSV reinfection is common throughout life. The majority of people with RSV infection develop upper respiratory tract disease, with mild symptoms similar to those caused by the common cold including cough and low-grade fever. Certain high-risk populations, including infants, young children, immunocompromised individuals and the elderly are vulnerable to LRTI. RSV infection that spreads to the lower respiratory tract can cause pneumonia or bronchiolitis, inflammation of the small airway passages entering the lungs that is characterized by respiratory distress and wheezing. The very young and elderly are at the highest risk for serious complications from RSV infection. Rates of RSV infections requiring medical attention are high throughout the first five years of life, and RSV is a common cause of pediatric hospitalization globally. RSV also constitutes a substantial disease burden among older adults. Among the elderly, hospitalization rates for RSV-acute respiratory infections increase with age. In China, 3.2 million pediatric and elderly RSV-LRTIs occur each year, leading to an estimated four hundred thousand hospitalizations annually.

Current standard of care for RSV

Currently, there are no available vaccines or effective RSV-specific antivirals for active infection in China. Ribavirin, a nucleoside analogue, is the only antiviral therapeutic approved for the treatment of RSV in infants aged zero to three in China and the United States. Ribavirin is infrequently used for the treatment of RSV in clinical practice due to its limited antiviral potency and toxicity concerns including bone marrow suppression and teratogenic and oncogenic potential, and is primarily used when the outcome of an RSV-LRTI could be fatal. Synagis (Paluvizimab), a prophylactic monoclonal antibody that has been shown to help prevent RSV infection, is approved in some countries, but not in China. Synagis is used in some developed countries in babies and young children at high risk of complications from RSV, such as those who are born premature or with chronic health conditions. Synagis use is limited by the therapy’s high cost and because it must be given before infection and throughout the RSV season.

Sisunatovir development path

Sisunatovir is a small-molecule antiviral designed to inhibit RSV replication by preventing F-mediated fusion with the host cell. We believe fusion inhibitors represent a promising treatment approach for RSV because the RSV-F protein plays a key role in infectivity and pathogenesis. The RSV-F protein is essential for the entry of the virus to the host cell. Additionally, cell surface expression of the RSV-F protein causes cell-to-cell fusion, leading to the giant syncytia characteristic of RSV infection. Based on the potency, bioavailability and tolerability demonstrated in preclinical studies and clinical trials, we believe that sisunatovir has the potential to become the new standard of care for RSV infection globally and in China.

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Results from the Phase 2a challenge study

In a Phase 2a challenge study in healthy adult volunteers conducted to assess the antiviral efficacy, safety and PK of sisunatovir, sisunatovir reduced RSV viral load and disease severity and was well-tolerated. In this randomized, double-blind, placebo-controlled trial, 66 healthy adults were challenged with RSV. After infection was confirmed, or five days after RSV inoculation, patients received sisunatovir or placebo for five days. The study enrolled 66 patients randomized 1:1:1 to receive sisunatovir 350 mg, sisunatovir 200 mg or placebo.

The primary endpoint was area under the curve (“AUC”) for viral load, as assessed by reverse transcriptase quantitative PCR (“RT-qPCR”) of nasal wash samples. The primary efficacy analysis set included patients successfully infected with RSV who received ≥1 dose of study drug. The mean AUC of RT-qPCR-assessed RSV viral load (log10 PFU equivalents [PFUe]/ml · h) was significantly lower with sisunatovir 350 mg (185.26; standard error [SE], 31.17; P = 0.002) and 200 mg (224.35; SE, 37.60; P = 0.007) versus placebo (501.39; SE, 86.57). The mean AUC of RSV viral load assessed by cell-based infectivity assay (log10 PFU/ml · h) was significantly lower with sisunatovir 350 mg (38.29; SE, 13.36; P = 0.012) and 200 mg (50.98; SE, 14.89; P = 0.027) versus placebo (162.35; SE, 37.77).

Sisunatovir Reduced Viral Load by 69% in Phase 2 Challenge Study

Disease severity improved with sisunatovir 350 mg and 200 mg versus placebo (P = 0.002 and P = 0.009, respectively, for AUC total symptom score [score × hours]). Daily nasal mucus weight was significantly reduced (P = 0.010 and P = 0.038 for sisunatovir 350 mg and 200 mg, respectively, versus placebo).

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Sisunatovir Cleared RSV Symptoms by Day 4

Safety and tolerability data were favorable. Adverse events were primarily graded 1 in severity and were transient in nature. There were no treatment-related SAEs and no subject discontinuations due to adverse events. GI treatment-emergent adverse events occurred more frequently with sisunatovir than with placebo. The majority of these events were transient, mild and resolved without concomitant medication and did not lead to discontinuation in any individual.

Treatment-Emergent adverse events

Treatment-emergent adverse events that occurred in > 2 subjects in any treatment group (safety analysis set)a

No. of subjects (%) for treatment group:

aRespiratory tract infection symptoms were only captured as an AE if they were unexpected as a result of the virus challenge, met the criteria for an AE, and were deemed clinically significant in the opinion of the investigator.

bAE, adverse event; TEAE, treatment-emergent adverse event; URTI, upper respiratory tract infection

There was no evidence of clinical resistance observed in the Phase 2a challenge study.

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Our strategy to seek regulatory approval of sisunatovir in China

ReViral has conducted a Phase 1 pharmacokinetic and safety trial of sisunatovir in healthy adults and a Phase 2a RSV challenge trial in healthy adults. Overall, sisunatovir has been studied in more than 200 subjects to date, with no SAEs reported and no neutropenia or cardiovascular toxicity demonstrated, which has been observed in trials of previous fusion inhibitors. ReViral is currently conducting a global three-part Phase 2 trial of sisunatovir in pediatric patients who are hospitalized due to RSV infection to evaluate the clinical efficacy, safety, tolerability and virologic activity of sisunatovir. Part A is an open-label, single-dose trial to assess the safety, tolerability, and PK profile of single doses of sisunatovir. Part B is a randomized, double-blind, placebo-controlled trial, in which multiple doses of sisunatovir or placebo are administered to assess the safety, tolerability, PK profile, and antiviral effects of multiple doses of sisunatovir. Part C is a larger randomized, double-blind, multiple dose, placebo-controlled trial. The aim of Part C is to assess reduction of viral load (antiviral effect) as the primary endpoint, with clinical signs and symptoms as secondary endpoints.

ReViral initiated a global Phase 2 clinical trial of sisunatovir in immunocompromised patients but suspended the trial in late 2021, as it was unable to enroll patients due to the COVID-19 pandemic. ReViral has announced plans to initiate a Phase 2 clinical trial of sisunatovir in adult patients with RSV infections who are at risk of severe outcomes, including the elderly and adult patients with chronic obstructive pulmonary disease, asthma and cardiac failure.

We licensed sisunatovir from ReViral for development and commercialization in Mainland China, Hong Kong, Macau and Singapore. We plan to focus our initial development efforts on RSV infection in pediatric and at-risk adult populations. Should ReViral advance sisunatovir into pivotal Phase 3 trials, we anticipate joining these Phase 3 trials by enrolling patients in China. We believe that enrollment contribution in China in global Phase 3 clinical trials may expedite the global development program as well as support regulatory approval in China.

Competition

The biopharmaceutical industry is characterized by rapidly advancing technologies, intense competition and a strong emphasis on proprietary products. There are many companies, including biotechnology and pharmaceutical companies, engaged in developing products for the indications our product candidates are designed to treat and in the therapeutic areas we are targeting. Many of our competitors may have substantially greater scientific, research and product development capabilities as well as greater financial, marketing and sales and human resources than we do. Smaller or early-stage companies may also prove to be significant competitors, particularly through collaborative arrangements with large and established companies. Accordingly, our competitors may be more successful than we may be in developing, commercializing, and achieving widespread market acceptance for their products.

An important part of our corporate strategy is to build a diversified product pipeline by acquiring or in-licensing and developing, or partnering to license and develop, product candidates that we believe are highly differentiated and have significant commercial potential. The acquisition or licensing of product candidates is very competitive and more established companies, which have acknowledged strategies to license or acquire products, may have competitive advantages over us, as may other emerging companies that take similar or different approaches to product acquisitions. We are aware of certain companies, including Zai Lab Limited and BeiGene, Ltd., that have business models that may compete directly with our own.

We expect that our ability to compete effectively will depend on our ability to advance our existing product candidates through clinical development and regulatory approval in our licensed territories on a timely basis, license additional product candidates to build on our existing platform, establish and maintain patent and other proprietary positions in our technologies and products, and the efficacy, reliability, product safety, price and patent position of our product candidates approved for sale, if any. Our ability to achieve a leadership position in our licensed territories will depend largely upon our ability to maximize the approval, acceptance and use of our product candidates and the availability of adequate financial resources to fund our personnel costs, clinical testing and development initiatives and marketing efforts. Another key aspect of remaining competitive in the industry is recruiting and retaining leading scientists to advance our development programs and personnel with the commercial expertise to effectively market our products.

We believe our long-term competitive position will depend upon our success in developing, obtaining regulatory approval for and commercializing innovative, cost-effective product candidates that serve critical unmet needs, along with our ability to launch and market products effectively in a highly competitive environment.

For additional information about the competition that our product candidates face, see “Part I—Item 1A—Risk Factors.”

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License and collaboration agreements

MyoKardia exclusive license agreement

In August 2020, we, together with our wholly-owned subsidiary LianBio Licensing, LLC, entered into an exclusive license agreement with MyoKardia (as subsequently amended, the “MyoKardia Agreement”), under which we obtained an exclusive license under certain patents and know-how of MyoKardia to develop, manufacture, use, sell, import and commercialize MyoKardia’s proprietary compound, mavacamten, in the licensed territory of Mainland China, Hong Kong, Macau, Taiwan, Thailand and Singapore, and in the licensed field of any indication in humans, which includes any prophylactic or therapeutic use in humans. The MyoKardia Agreement was subsequently assigned to Lian Cardiovascular and then to Lian Cardiovascular Limited. Under the MyoKardia Agreement, we agreed not to develop and commercialize certain competing products for a certain specified period.

We are obligated to use commercially reasonable efforts to develop and commercialize mavacamten in our licensed field and licensed territory under a development plan and a commercial plan.

Under the terms of the MyoKardia Agreement, we paid to MyoKardia an upfront payment of $40.0 million and paid an additional $35.0 million upon a specified financing event, which occurred on October 29, 2020. In conjunction with entering into the MyoKardia Agreement, we also granted a warrant (the “MyoKardia Warrant”) to MyoKardia as partial consideration for the grant of certain licenses and rights to us pursuant to the MyoKardia Agreement. The MyoKardia Warrant is exercisable for 170,000 ordinary shares of Lian Cardiovascular, our wholly-owned subsidiary, at any time and from time to time at the option of the holder. In accordance with the terms of that certain Amended and Restated Option Agreement dated as of August 10, 2020, by and among the Company, QED, MyoKardia and certain other parties thereto (the “Option Agreement”), MyoKardia had an option to (i) convert the 170,000 ordinary shares of Lian Cardiovascular into 2,924,011 of the Company’s ordinary shares or (ii) convert the MyoKardia Warrant into a warrant to purchase 103,805 of the Company’s ordinary shares, with an exercise price of $47.03 per share, in connection with the completion of our initial public offering. MyoKardia elected not to exercise this option and continues to hold the MyoKardia Warrant to purchase ordinary shares in Lian Cardiovascular. The Option Agreement, and MyoKardia’s option to convert the MyoKardia Warrant, irrevocably terminated upon the completion of our initial public offering.

In addition, under the terms of the MyoKardia Agreement, if we achieve specified development and commercialization milestones, we will be required to pay to MyoKardia development milestone payments of up to $60.0 million and sales milestone payments based on cumulative sales of mavacamten of up to $87.5 million. In addition, if we successfully develop and commercialize mavacamten, we will pay MyoKardia tiered royalties on the sales of mavacamten at percentage rates ranging from the low- to upper-teens until the latest of the last-to-expire licensed patent covering mavacamten, the expiration of regulatory exclusivity for mavacamten, or the tenth anniversary of the first commercial sale of mavacamten, in each case on a product-by-product and region-by-region basis. As of the date of this Annual Report on Form 10-K, the last-to-expire patent under the agreement in Taiwan will have a twenty-year statutory expiration date in 2038 if allowed, and in each of the other licensed territories the last-to-expire patent is a Patent Cooperation Treaty (“PCT”) application and will have a twenty-year statutory expiration date in 2040, provided that such PCT application would enter each of such licensed territory and be allowed therein. The expected termination of the royalty obligations will depend on factors such as the filing of additional patents covering the licensed product during the term of the applicable agreement, the availability and application of patent term extensions and/or expiration of regulatory exclusivity for the licensed product in the licensed territory. We also have entered into a clinical supply agreement and agreed to enter into a commercial supply agreement, pursuant to which we will purchase mavacamten exclusively from MyoKardia for the clinical supply and commercial supply, respectively. However, we also have the right to have a third party manufacture mavacamten in the licensed territory in certain circumstances, including if MyoKardia fails to supply certain amounts of mavacamten.

The term of the MyoKardia Agreement will depend on the patent coverage we and MyoKardia may obtain, as well as any available regulatory exclusivity, in each region within the licensed territory. The MyoKardia Agreement will remain in effect until the expiration of all payment obligations, and may be earlier terminated by either party for the other party’s uncured material breach, bankruptcy, or insolvency. MyoKardia may also terminate the agreement for our failure to achieve certain key milestones, or if we challenge any of the licensed patents. We have the right to terminate the MyoKardia Agreement for convenience upon advance notice to MyoKardia.

On October 8, 2020, we entered into an amendment with MyoKardia to change the timing for the parties to enter into the development supply agreement. On January 4, 2021, we entered into a second amendment with MyoKardia to change the timing for the parties to enter into the development supply agreement and pharmacovigilance agreement; we have subsequently entered into those agreements.

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QED license agreement

In October 2019, we entered into a license agreement with QED (as subsequently amended, the “QED Agreement”), under which we obtained an exclusive, sublicensable license under certain patents and know-how (including patents and know-how that QED licensed from QED’s upstream licensor) to develop, manufacture, use, sell, import, and commercialize QED’s ATP-competitive, FGFR1-3 tyrosine kinase inhibitor, infigratinib, in pharmaceutical products in the licensed territory of Mainland China, Macau, Hong Kong, Taiwan, Thailand, Singapore and South Korea, in the licensed field of human prophylactic and therapeutic uses in cancer indications. In September 2020, we entered into an amendment with QED to reduce the licensed territories to include Mainland China, Macau and Hong Kong. In December 2021, we entered into a second amendment with QED to modify our development obligations with respect to certain clinical trials, and change the development milestone payments we owe to QED and the royalty rates for the tiered royalties on net sales of licensed products we will pay to QED.

Under the QED Agreement, we are obligated to use commercially reasonable efforts to develop and commercialize licensed products in our licensed field and licensed territory under a development plan. Under the terms of the QED Agreement, we are also responsible for funding all development and commercialization of the licensed products in our licensed territory. Our rights under the QED Agreement are subject to QED’s upstream licensor’s license to a third party to use infigratinib in combination with such third party’s proprietary compounds in clinical trials for oncology. If we (or QED) do not promptly respond to an inquiry from QED’s upstream licensor about whether we intend to seek regulatory approval for and commercialize infigratinib in a particular indication, then QED’s upstream licensor may grant such third party an exclusive, worldwide license commercialize infigratinib in combination with such third party’s proprietary compounds in the field of oncology.

Under the terms of the QED Agreement, we made an upfront payment of $10.0 million. We also granted three warrants (collectively, the “QED Warrants”), valued at $1.0 million, to QED, exercisable for an aggregate of 100,000 ordinary shares of Lian Oncology, our wholly-owned subsidiary, at an exercise price of $0.0001 per share. The QED Warrants subsequently vested and each underlying warrant was exercisable at any time and from time to time at the option of the holder. Pursuant to the Option Agreement, QED had an option to convert the QED Warrants into a warrant to purchase a certain number of our ordinary shares. On October 5, 2021, QED exercised its option to convert the QED Warrants. Accordingly, on October 18, 2021, we issued to QED a warrant to purchase 347,569 of our ordinary shares at an exercise price of $0.000017100448 per share and, concurrently with such issuance, the QED Warrants were deemed to be performed and settled in full and were irrevocably terminated.

In addition, under the terms of the QED Agreement, we will be required to pay QED development milestone payments of up to $7.0 million if we achieve specified development milestones, and sales milestone payments of up to $87.5 million if we achieve specified commercialization milestones. Additionally, if we successfully develop and commercialize the licensed products, we will pay QED tiered royalties on net sales of licensed products at the greater of (a) percentage rates in the mid- to high-teens on the net sales of the licensed products, or (b) the applicable rate payable under QED’s agreement with its upstream licensor (capped in the mid-teens), until the latest of the last-to-expire licensed patent, the expiration of regulatory exclusivity for the licensed product, or the tenth anniversary of the first commercial sale of the licensed product, in each case on a product-by-product and region-by-region basis. As of the date of this Annual Report on Form 10-K, the last-to-expire patent under the agreement is a PCT application and will have a twenty-year statutory expiration date in 2040 in each licensed territory, provided the PCT application will enter each of the licensed territories and be allowed therein. The expected termination of the royalty obligations will depend on factors such as the filing of additional patents covering the licensed product during the term of the applicable agreement, the availability and application of patent term extensions and/or expiration of regulatory exclusivity for the licensed product in the licensed territory. We also entered into a clinical supply agreement and will enter into a commercial supply agreement pursuant to which we will purchase licensed products from QED or its assignee. We also have the right to manufacture licensed products in the licensed territory for development and commercialization of the licensed products in the licensed territory and licensed field.

The term of the QED Agreement will depend on the patent coverage we and QED may obtain, as well as any available regulatory exclusivity, in each region within the licensed territory. The QED Agreement will remain in effect until the expiration of the royalty term and may be earlier terminated by either party for the other party’s uncured material breach, bankruptcy or insolvency. We have the right to terminate the QED Agreement for convenience at any time upon advance notice to QED, and QED may terminate the agreement if we challenge any of the licensed patents.

In October 2020, we, together with our wholly-owned subsidiary, LianBio Licensing, LLC, entered into a novation agreement with QED, pursuant to which the QED Agreement was novated and transferred from us to our wholly-owned subsidiary LianBio Licensing, LLC. The QED Agreement was subsequently assigned to Lian Oncology and then to Lian Oncology Limited.

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Navire exclusive license agreement

In August 2020, we, together with our wholly-owned subsidiary, LianBio Licensing, LLC, entered into an exclusive license agreement with Navire (as subsequently amended, the “Navire Agreement”), under which we obtained an exclusive, sublicensable license under certain patents and know-how of Navire to develop, manufacture, use, sell, import and commercialize Navire’s proprietary SHP2 inhibitor, BBP-398 (formerly known as IACS-15509) in the licensed territory of Mainland China, Hong Kong, Macau, Taiwan, Thailand, Singapore, and South Korea, in the licensed field of diagnostic, prophylactic, palliative, and therapeutic uses or indications in humans. We also have certain option rights to take licenses to certain compounds or products that Navire or its affiliates may acquire during the term of the Navire Agreement to develop combination products or therapies in combination with the licensed compound. The Navire Agreement was subsequently assigned to Lian Oncology and then to Lian Oncology Limited.

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LIANY · 10-K · period ended 2021-12-31

Item 1. Business

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LIANY · 10-K · period ended 2021-12-31

Item 1. Business

LIANY US Equity