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Item 1A. Risk Factors

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Investors should carefully consider the risks and uncertainties described below and the other information in this Annual Report on Form 10-K, including our consolidated financial statements and related notes appearing elsewhere herein including the section titled “Operating and Financial Review and Prospects,” before deciding whether to invest or maintain any investment in our ADSs.

Our business, financial condition, results of operations or prospects could be materially and adversely affected if any of these risks occurs, and as a result, the market price of our ADSs could decline and some or all of their value may be lost.

Our business, financial condition, results of operations or prospects could be materially and adversely affected if any of these risks occurs, and as a result, the market price of our ordinary shares

could decline and some or all of their value may be lost.

The risks and uncertainties described below are not the only ones we face.

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In this section, we first provide a summary of the more significant risks and uncertainties we face and then provide a full set of risk factors and discuss them in greater detail.

These disclosures reflect our beliefs and opinions as to factors that could materially and adversely affect our company and its securities in the future.

References to past events are provided by way of example only and are not intended to be a complete listing or a representation as to whether or not such factors have occurred in the past or their likelihood of occurring in the future.

Risks Related to Our Limited Operating History, Financial Position and Capital Requirements

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Even if we do achieve profitability, we might not be able to sustain or increase profitability.

If we fail to become and remain profitable, the value of our ADSs could be depressed and our ability to raise capital, expand our business, maintain our research and development efforts, diversify our Product Candidates or even continue our operations could be impaired, and some or all of the value of our ADSs could be lost.

If we fail to become and remain profitable, the value of our ordinary shares could be depressed and our ability to raise capital, expand our business, maintain our research and development efforts, diversify our Product Candidates or even continue our operations could be impaired, and some or all of the value of our ordinary shares could be lost.

We will require substantial additional capital to achieve our goals, and a failure to obtain or access this necessary capital when needed on acceptable terms, or at all, could force us to delay, limit, reduce or terminate our product development programs, commercialization efforts or other operations.

Our existing capital will not be sufficient for us to fund our Product Candidate through regulatory approvals, and we will need additional capital to complete their development and commercialization.

Our existing capital will not be sufficient for us

to fund our Product Candidate through regulatory approvals, and we will need additional capital to complete their development and commercialization.

The development of biopharmaceutical product candidates is capital-intensive.

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Further, subject to the terms and conditions of each partnership, external factors beyond our control may affect our collection of milestone payments or royalty payments under such a partnership.

For example, on November 21, 2023, Connect HK and Connect SZ, two of the Company’s

wholly owned subsidiaries, or the Connect Licensor, entered into an exclusive license and collaboration agreement, or the Simcere Agreement, with Simcere Pharmaceutical Co., Ltd., or the Simcere Licensee, to develop and commercialize rademikibart in Greater China.

For example, on November 21, 2023, Connect HK and Connect SZ, two of the Company’s wholly owned subsidiaries, or the Connect Licensor, entered into an exclusive license and collaboration agreement, or the Simcere Agreement, with Simcere Pharmaceutical Co., Ltd., or the Simcere Licensee, to develop and commercialize rademikibart in Greater China.

For additional information, see Item 1.

“Business – Intellectual Property – Material Contracts”.

“Business – Overview – Rademikibart for Asthma and COPD”.

However, external factors such as changes in applicable laws, government actions or other similar circumstances beyond our control could cause delay or disruption in future payments owed to us by the Simcere Licensee under the Simcere Agreement.

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If we are unable to raise capital or find alternative sources of financing when needed or on attractive terms, we could be forced to delay, reduce or eliminate our research and development programs or any future commercialization efforts, including in connection with any license or collaboration agreement that we may have entered into or may enter into in the future, and we may need to focus our efforts on fewer Product Candidates to conserve our resources.

Our operating plans and other demands on our cash resources could change as a result of many factors currently unknown to us, and we might need to seek additional funds sooner than planned, through public or private equity or debt financings or other capital sources, including potentially collaborations, licenses and other similar arrangements.

In addition, we might seek additional capital due to favorable market conditions or strategic considerations even if we believe we have sufficient funds for our current or future operating plans.

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Additional funding might not be available on acceptable terms, or at all.

The global credit and financial markets have experienced extreme volatility and disruptions, including severely diminished liquidity and credit availability, declines in consumer confidence, declines in economic growth, increases in unemployment rates, and uncertainty about economic stability, all resulting from global, regional and geopolitical events, including, for example, the Russia-Ukraine and the Israel-Gaza wars.

If the equity and credit markets deteriorate, it may make any necessary debt or equity financing more difficult, more costly or more dilutive.

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Any inability to access or delay in accessing these funds could adversely affect our business and financial position.

Raising additional capital may cause substantial dilution to our shareholders, including holders of our ADSs, restrict our operations or require us to relinquish rights to our technologies or Product Candidates.

Until such time, if ever, as we can generate substantial revenues, we expect to finance our business and operational needs through equity offerings, debt financings or other financing sources, including potentially collaborations, licenses and other similar arrangements.

To the extent that we raise additional capital through the sale of equity or convertible debt securities, investors’ ownership interests could be substantially diluted, and the terms of these securities could include liquidation or other preferences that adversely affect investors’ rights as a holder of our ADSs.

We currently have an effective shelf registration statement covering the offering of up to $300,000,000 in the aggregate of our ADSs, including up to $150,000,000 of our ADSs that may be issued and sold from time to time “at the market” under a sales agreement with Leerink Partners LLC (formerly SVB Securities LLC) and Cantor Fitzgerald & Co.

There has been no takedown from the shelf registration statement or sale of ADSs under such sales agreement, but any such financing if effected would likely cause substantial dilution to holders of our securities.

Raising additional capital may cause substantial dilution to our shareholders, restrict our operations or require us to relinquish rights to our technologies or Product Candidates.

We currently have an effective shelf registration statement covering the offering of up to $300,000,000 in the aggregate of our securities, including up to $150,000,000 of our ordinary shares that may be issued and sold from time to time “at the market” under a sales agreement with Cantor Fitzgerald & Co.

Any takedown of equity securities from the shelf registration statement or sale of ordinary shares under such sales agreement would likely cause substantial dilution to holders of our securities.

Debt financing and preferred equity financing, if available, may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures or declaring dividends.

If we raise funds through future collaborations, licenses and other similar arrangements, we may have to relinquish valuable rights to our future revenue streams, research programs or Product Candidates or grant licenses on terms that may not be favorable to us and/or that may reduce the value of our ADSs.

If we raise funds through future collaborations, licenses, royalty financings, and other similar arrangements, we may have to relinquish valuable rights to our future revenue streams, research programs or Product Candidates or grant licenses on terms that may not be favorable to us and/or that may reduce the value of our ordinary shares.

We may also cede some or all control of the development of our products or Product Candidates, such as the pace and scope of clinical trials, as a result of such third-party arrangements.

If we are unable to raise funds through equity or debt financings when needed, we could be required to

delay, limit, reduce or terminate our product development or future commercialization efforts or grant rights to develop and market products or Product Candidates that we would otherwise prefer to develop and market ourselves.

If we are unable to raise funds through equity or debt financings when needed, we could be required to delay, limit, reduce or terminate our product development or future commercialization efforts or grant rights to develop and market products or Product Candidates that we would otherwise prefer to develop and market ourselves.

Risks Related to the Discovery, Development and Regulatory Approval of Our Product Candidates

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All jurisdictions in which we intend to conduct our clinical drug development activities regulate these activities in great depth and detail.

We intend to focus our activities on major markets, including the U.S.

We intend to focus our activities on major markets, including the U.S., Australia, Europe and the PRC.

We currently conduct or plan to conduct clinical trials in various countries and jurisdictions, and we must comply with the numerous and varying regulatory requirements of each such jurisdiction.

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or a negative finding from an inspection of our clinical trial operations or study sites;

the NMPA or a foreign regulatory authority that an investigational protocol or plan is clearly deficient to meet its stated objectives;

• developments in trials conducted by competitors for related technology that raises FDA, NMPA, EMA, or foreign regulatory authority concerns about risk to patients of the technology broadly, or findings by the FDA, the NMPA or a foreign regulatory authority that an investigational protocol or plan is clearly deficient to meet its stated objectives;

• delays or failure in recruiting, screening and enrolling suitable patients and delays or failure caused by patients withdrawing from clinical trials or failing to return for post-treatment follow-up;

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The Russia-Ukraine war impacted our ability to continue our trials in Ukraine and the surrounding region and prevented us from obtaining data from our trials, previously located at sites in these countries.

This also delayed the completion of our clinical trials and/or analyses of clinical results, which could materially harm our business.

This also delayed the completion of our clinical trials and/or analyses of clinical results.

Moreover, principal investigators for our clinical trials may serve as scientific advisors or consultants to us from time to time and receive compensation in connection with such services.

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In addition, there may be limited patient pools from which to draw for clinical studies.

The eligibility criteria of our clinical studies will further limit the pool of available study participants as we will require that patients have specific characteristics that we can measure or to assure their disease is either severe enough or not too advanced to include them in a study.

The eligibility criteria of our clinical studies will further limit the pool of available study participants as we

will require that patients have specific characteristics that we can measure or to assure their disease is either severe enough or not too advanced to include them in a study.

Patient enrollment also depends on many other factors, including:

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Treatment-related side effects could also affect patient recruitment and the ability of enrolled patients to complete the trial or result in potential liability claims.

Regulatory authorities could order us to cease further development of, deny approval of, or require us to cease selling any approved products for any or all targeted indications.

Regulatory authorities could order us to cease further development of, deny approval of, or

require us to cease selling any approved products for any or all targeted indications.

If we are required to delay, suspend or terminate any clinical trial or commercialization efforts, the commercial prospects of one or more Product Candidates or products may be harmed, and our ability to generate product revenues from them or other Product Candidates that we develop may be delayed or eliminated.

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• regulatory authorities may suspend, limit or withdraw approvals of such product, or seek an injunction against its manufacture or distribution;

• regulatory authorities may require additional warnings on the label, including “boxed” warnings, or issue safety alerts, Dear Healthcare Provider letters, press releases or other communications containing warnings or other safety information about the product;

• regulatory authorities may require additional warnings on the label, including “boxed” warnings, or issue safety alerts, DHCP letters, press releases or other communications containing warnings or other safety information about the product;

• we may be required to change the way the product is administered or conduct additional clinical trials or post-approval studies;

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Moreover, caution should be exercised in drawing any conclusions from a comparison of data that does not come from head-to-head analysis.

As a result, the top-line or preliminary results that we report may differ from future results of the same studies, or different conclusions or considerations may qualify such results, once additional data have been received and fully evaluated.

As a result, the top-line or

preliminary results that we report may differ from future results of the same studies, or different conclusions or considerations may qualify such results, once additional data have been received and fully evaluated.

Top-line or preliminary data also remain subject to audit and verification procedures that may result in the final data being materially different from the preliminary data we previously published.

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Interim data from clinical trials that we may complete are subject to the risk that one or more of the clinical outcomes may materially change as patient enrollment continues and more patient data become available or as patients from our clinical trials continue other treatments for their disease.

Adverse differences between preliminary or interim data and final data could

significantly harm our business prospects.

Disclosure of interim data by us or by our competitors could also result in volatility in the price of our ADSs.

Further, others, including regulatory agencies, may not accept or agree with our assumptions, estimations, calculations, conclusions or analyses or may interpret or weigh the importance of data differently, which could impact the value of the particular program, the approvability or commercialization of the particular Product Candidate or product and our ADSs.

Adverse differences between preliminary or interim data and final data could significantly harm our business prospects.

Disclosure of interim data by us or by our competitors could also result in volatility in the price of our ordinary shares.

In addition, the information we choose to publicly disclose regarding a particular study or clinical trial is based on what is typically extensive information, and investors or others may not agree with what we determine is material or otherwise appropriate information to include in our disclosure.

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If such confirmatory studies fail to confirm the drug’s clinical benefit, or if the sponsor fails to conduct such studies in a timely manner, the FDA, may withdraw its approval of the drug on an expedited basis.

In addition, in December 2022, former President Biden signed an omnibus appropriations bill to fund the U.S.

government through fiscal year 2023.

Included in that omnibus bill was the Food and Drug Omnibus Reform Act of 2022, which among other things, provided FDA statutory authority to mitigate potential risks to patients from continued marketing of ineffective drugs previously granted accelerated approval.

In addition, the Food and Drug Omnibus Reform Act of 2022, among other things, provided FDA statutory authority to mitigate potential risks to patients from continued marketing of ineffective drugs previously granted accelerated approval.

Under these provisions, the FDA may require a sponsor of a product seeking accelerated approval to have a confirmatory trial underway prior to such approval being granted.

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There can be no assurance that after our evaluation of the feedback and other factors we will decide to pursue or submit an NDA or BLA, for accelerated approval or seek any other form of expedited development, review or approval.

Furthermore, if we decide to submit an application for accelerated approval for our Product Candidates, there can be no assurance that such submission or application will be accepted or that any expedited development, review or approval will be granted on a timely basis, or at all.

timely basis, or at all.

The FDA, the NMPA or other comparable foreign regulatory authorities could also require us to conduct further studies prior to considering our application or granting approval of any type.

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Because of the early stage of some of our development and clinical programs, the success of our Product Candidates will depend on several factors, including the following:

• timely and successful enrollment in clinical trials and completion of clinical trials and preclinical studies with favorable results, for example, the impact of the Ukraine-Russia war on the schedule of our clinical trials, including on patient enrollment and trial data collection;

• timely and successful enrollment in clinical trials and completion of clinical trials and preclinical studies with favorable results;

• submission of and allowance to proceed with clinical trials under INDs by the FDA or similar regulatory filing by the NMPA or comparable foreign regulatory authorities for the conduct of clinical trials of our preclinical Product Candidates and our proposed design of future clinical trials;

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If any of these events occur, we may be forced to abandon our development efforts for one or more programs, which would have a material adverse effect on our business and could potentially cause us to cease operations.

We have never submitted an NDA or BLA, and may be unable to do so for any of our Product Candidates.

Although our management team has experience doing so, as a Company we have never submitted an NDA or BLA, and may be unable to do so for any of our Product Candidates.

We will need to successfully obtain FDA, NMPA or comparable foreign regulatory approval to market rademikibart or any future Product Candidates.

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The regulatory approval processes of the FDA, the NMPA and comparable foreign authorities are lengthy, time consuming and unpredictable, and if we are ultimately unable to obtain regulatory approval for our Product Candidates, our business will be substantially harmed.

The time required to obtain approval by the FDA, the NMPA and comparable foreign authorities is unpredictable but typically takes many years following the commencement of clinical trials and depends upon numerous factors, including the substantial discretion of the regulatory authorities.

including the substantial discretion of the regulatory authorities.

In addition, approval policies, regulations, or the type and amount of clinical data necessary to gain approval may change during the course of a Product Candidate’s clinical development and may vary unexpectedly and significantly among jurisdictions.

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Neither we nor any future collaborator is permitted to market any of our Product Candidates in the U.S.

or any other jurisdiction until we receive regulatory approval of an

NDA or BLA from the FDA or the comparable foreign regulatory submission from a comparable foreign regulatory authority.

or any other jurisdiction until we receive regulatory approval of an NDA or BLA from the FDA or the comparable foreign regulatory submission from a comparable foreign regulatory authority.

Prior to obtaining approval to commercialize a Product Candidate in the U.S., the PRC or elsewhere, we or our collaborators must demonstrate with substantial evidence from well-controlled clinical trials, and to the satisfaction of the FDA, the NMPA or other comparable foreign regulatory agencies, as applicable, that such Product Candidates are safe and effective, or in the case of biologics in the U.S., safe, pure, and potent, for their intended uses.

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Of the large number of drugs in development, only a small percentage successfully complete the FDA, the NMPA or comparable foreign regulatory approval processes and are commercialized.

The lengthy approval process as well as the unpredictability of future clinical trial results may result in our failing to obtain regulatory approval to market rademikibart or any future Product Candidates, which would significantly harm our business, financial condition, results of operations and prospects.

The lengthy approval process as well as the unpredictability of future clinical trial results may result in our failing to obtain regulatory approval to market rademikibart

or any future Product Candidates, which would significantly harm our business, financial condition, results of operations and prospects.

Even if we eventually complete clinical trials and receive approval of an NDA, BLA or other comparable foreign submission for our Product Candidates, the FDA, the NMPA or other comparable foreign regulatory authorities may grant approval contingent on the performance of costly additional clinical trials and/or the implementation of a REMS, which may be required to ensure safe use of the drug after approval.

The FDA, the NMPA or the comparable foreign regulatory

authority also may approve a Product Candidate for a more limited indication or patient population than we originally requested.

The FDA, the NMPA or the comparable foreign regulatory authority also may approve a Product Candidate for a more limited indication or patient population than we originally requested.

Any delay in obtaining, or inability to obtain, the applicable regulatory approval would delay or prevent commercialization of that Product Candidate and would materially adversely impact our business and prospects.

Disruptions at the FDA, the NMPA, comparable foreign regulatory authorities, and other government agencies caused by shifting governmental policies and priorities, reductions in the federal workforce, funding shortages or global health concerns could hinder their ability to hire, retain or deploy key leadership and other personnel, or otherwise prevent new or modified products from being developed, approved or commercialized in a timely manner or at all, which could negatively impact our business.

Disruptions at the FDA, the NMPA, comparable foreign regulatory authorities, and other government agencies caused by shifting governmental policies and priorities, reductions or changes in the federal workforce or funding shortages could hinder their ability to hire, retain or deploy key leadership and other personnel, or otherwise prevent new or modified products from being developed, approved or commercialized in a timely manner or at all, which could negatively impact our business.

The ability of the FDA, the NMPA, comparable foreign regulatory authorities and other government agencies to review and approve new products can be affected by a variety of factors, including government budget and funding levels, statutory, regulatory and policy changes, the regulatory authority’s ability to hire and retain key personnel and accept the payment of user fees, and other events that may otherwise affect the regulatory authority’s ability to perform routine functions.

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government has shut down several times and some regulatory agencies, such as the FDA, have had to furlough critical employees and stop critical activities.

More recently, on January 20, 2025, President Trump signed an executive order creating an advisory commission, the “Department of Government Efficiency” to reform federal government processes and reduce expenditures.

Pressures on and uncertainty surrounding the U.S.

federal government’s budget, and potential changes in budgetary priorities and spending levels, could adversely affect staffing levels and funding for the FDA and other regulatory agencies.

Disruptions in how the FDA or other regulatory agencies operate due to these policies may materially adversely affect our business.

Separately, in response to the COVID-19 pandemic, the FDA postponed most inspections of domestic and foreign manufacturing facilities at various points.

If a prolonged government shutdown occurs, or if public health emergencies prevent the FDA, the NMPA or other comparable foreign regulatory authorities from conducting their regular inspections, reviews or other regulatory activities, it could significantly impact the ability of the FDA, the NMPA or other comparable foreign regulatory authorities to timely review and process our regulatory submissions, which could have a material adverse effect on our business.

In addition, the current U.S.

Presidential administration has issued certain policies and Executive Orders directed towards reducing the employee headcount and costs associated with U.S.

administrative agencies, including the FDA, which have led to substantial personnel changes, and it remains unclear the degree to which these efforts may limit or otherwise adversely affect the FDA’s ability to conduct routine activities.

If a prolonged government shutdown occurs, or if funding shortages, staffing limitations or similar factors hinder or prevent the FDA, the NMPA or other comparable foreign regulatory authorities from conducting their regular inspections, reviews or other regulatory activities, the ability of the FDA, the NMPA or other such regulatory authorities to timely review and process our regulatory submissions could be significantly impacted, which could have a material adverse effect on our business.

Our Product Candidates for which we intend to seek approval as biologic products may face competition sooner than anticipated.

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On April 26, 2023, the European Commission published proposals to revise the existing EU legislation on medicinal products (“EU Pharma Law Review”).

The EU Pharma Law Review consists of two proposals, a new directive and a new regulation (“EU Pharma Law Proposal”) that would repeal and replace the relevant legislation concerning medicinal products for human use.

The EU Pharma Law Review could have a significant impact on the regulatory data protection (“RDP”) available for to innovative medicinal products in the EU.

If adopted in current form, the EU Pharma Law Proposal would reduce the current baseline for data exclusivity.

Such RDP reduction could lead to a faster access to the EU market for generics and biosimilars.

The proposed revisions remain to be agreed upon and adopted by the European Parliament and European Council and the EU Pharma Law Proposal may therefore be substantially revised before adoption, which is not anticipated before early 2026.

The revisions may however have a significant impact on the pharmaceutical industry and our business in the long term.

The EU Pharma Law Review consists of two proposals, a new directive and a new regulation, that will repeal and replace the relevant legislation concerning medicinal products for human use.

The proposed changes were since discussed and negotiated by the European Parliament and the Council of the EU as part of the EU ordinary legislative process.

A provisional agreement was reached by the European Parliament and Council of the EU on the proposed revisions on December 11, 2025.

The proposed revisions (among other things, affecting the duration of regulatory data protection and market protection, including for orphan medicinal products, and revising the eligibility for expedited pathways) remain to be formally adopted by the two institutions, which is not anticipated before early 2026.

The proposed changes are not expected to enter into application before 2028.

Any such changes may have a significant impact on the pharmaceutical industry and on our business in the long term.

Risks Related to Our Reliance on Third Parties

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legislation, sanctions, trade restrictions and other foreign regulatory requirements which could increase the cost or reduce the supply of material available to us, delay the procurement or supply of such material or have an adverse effect on our ability to secure significant commitments from governments to purchase our potential therapies.

For example, in January 2024, there was Congressional activity, including the introduction of the BIOSECURE Act (H.R.

7085) in the House of Representatives and a substantially similar Senate bill (S.3558).

The BIOSECURE Act was passed by the House of Representatives in September 2024.

If these bills become law, or similar laws are passed, they would have the potential to severely restrict the ability of U.S.

biopharmaceutical companies like us to purchase services or products from, or otherwise collaborate with, certain Chinese biotechnology companies “of concern” without losing the ability to contract with, or otherwise receive funding from, the U.S.

For example, the U.S.

BIOSECURE Act, which was enacted in December 2025, prohibits federal agencies from procuring or using any biotechnology equipment or services from “biotechnology companies of concern”, or entering into, extending, or renewing any contracts with entities that use such biotechnology equipment or services from “biotechnology companies of concern”.

Congress has interpreted a “biotechnology company of concern” as an entity that is under the control of a foreign adversary and that poses a risk to national security based on its research or multiomic data collection (e.g., collection of genomic information).

While the U.S.

BIOSECURE Act has a grandfathering period of five years for existing contracts, and has carveouts for manufacture of drugs for supply under Medicaid and Medicare Part B, subject to the Secretary of Veteran Affairs’ discretion, the impact of the U.S.

BIOSECURE Act on the biotechnology industry is uncertain.

If the foreign CROs and CMOs we rely on become subject to trade restrictions, sanctions, increased tariffs or other regulatory requirements by the U.S.

government (including designation as a “biotechnology company of concern” under the U.S.

BIOSECURE Act), or if the U.S.

or PRC or other foreign governments take retaliatory actions due to recent or increased tensions between the U.S.

and the PRC or other countries, it may have the potential to severely restrict the ability of U.S.

biopharmaceutical companies like us to purchase services or products from, or otherwise collaborate with, certain “biotechnology companies of concern” without losing the ability to contract with, or otherwise receive funding from, the U.S.

Our current and anticipated future dependence upon others for the manufacture of our Product Candidates or drugs may adversely affect our future profit margins and our ability to commercialize any Product Candidates that receive marketing approval on a timely and competitive basis.

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Because we currently rely on other third parties to manufacture our Product Candidates and to perform development, quality testing and other services, we must, at times, share our proprietary technology and confidential information, including trade secrets, with them.

We seek to protect our proprietary technology, in part, by entering into confidentiality agreements, consulting agreements or other similar agreements with our advisors, employees and consultants prior to beginning research or disclosing proprietary information.

We seek to protect our proprietary technology, in part, by entering into confidentiality

agreements, consulting agreements or other similar agreements with our advisors, employees and consultants prior to beginning research or disclosing proprietary information.

These agreements are intended to limit the rights of the third parties to use or disclose our confidential information, but such agreements could be breached, and we might not enter into such agreements with all applicable parties.

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In order to maintain the physical security of our chops, we generally have them stored in secured locations accessible only to the designated key employees of our legal, administrative or finance departments.

Our designated legal

representatives generally do not have access to the chops.

Our designated legal representatives generally do not have access to the chops.

Although we have approval procedures in place and monitor our key employees, including the designated legal representatives of our subsidiaries, the procedures may not be sufficient to prevent all instances of abuse or negligence.

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• potential product liability claims;

• the availability of alternative effective treatments for the disease indications our p Product Candidates are intended to treat and the relative risks, benefits and costs of those treatments;

• the availability of alternative effective treatments for the disease indications our Product Candidates are intended to treat and the relative risks, benefits and costs of those treatments;

• the effectiveness of our or any of our potential future collaborators’ distribution, sales and marketing strategies;

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Therefore, coverage and reimbursement for products can differ significantly from payor to payor.

As a result, the coverage processes may require us to provide scientific and clinical support for the use of our products to each payor separately, with no assurance that coverage will be applied consistently or obtained in the first instance.

It is possible that a third-party payor may consider our products as substitutable and only offer to provide coverage for a less expensive product.

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Inadequate coverage and reimbursement may impact the demand for, or the price of, any drug for which we obtain marketing approval.

If coverage and adequate reimbursement are not available,

or are available only to limited levels, we may not be able to successfully commercialize any Product Candidates that we develop, which could have an adverse effect on our operating results and our overall financial condition.

If coverage and adequate reimbursement are not available, or are available only to limited levels, we may not be able to successfully commercialize any Product Candidates that we develop, which could have an adverse effect on our operating results and our overall financial condition.

Third-party payors increasingly are challenging prices paid for pharmaceutical products and services and requesting discounts or rebates through pharmacy benefit managers.

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The biotechnology and pharmaceutical industries are characterized by rapidly advancing technologies, intense competition and a strong emphasis on proprietary and novel products and product candidates.

Our competitors have developed, are developing or may develop products or product candidates competitive with our Product Candidates.

Our competitors have

developed, are developing or may develop products or product candidates competitive with our Product Candidates.

Any Product Candidates that we successfully develop and commercialize will compete with existing therapies and new therapies that may become available in the future.

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If any Product Candidate ultimately receives regulatory approval, we must build a marketing and sales organization with technical expertise and supporting distribution capabilities to commercialize each such product in major markets, which will be expensive and time consuming, or collaborate with third parties that have direct sales forces and established distribution systems, either to augment our own sales force and distribution systems or in lieu of our own sales force and distribution systems.

Although our management team has experience doing so, as a company we have no prior experience in the marketing, sale and distribution of biopharmaceutical products and there are significant risks involved in building and managing a sales organization, including our ability to hire, retain and incentivize qualified individuals, generate sufficient sales leads, provide adequate training to sales and marketing personnel and effectively manage a geographically dispersed sales and marketing team.

including our ability to hire, retain and incentivize qualified individuals, generate sufficient sales leads, provide adequate training to sales and marketing personnel and effectively manage a geographically dispersed sales and marketing team.

Any failure or delay in the development of our internal sales, marketing and distribution capabilities would adversely impact the commercialization of these products.

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• the illegal importation of competing products from countries where government price controls or other market dynamics result in lower prices;

• business interruptions resulting from geopolitical actions, including war and terrorism, natural disasters, including earthquakes, typhoons, floods and fires, or public health epidemics.

• business interruptions resulting from geopolitical actions, including war and terrorism, natural disasters, including earthquakes, typhoons, floods and fires, or public health epidemics or pandemics.

Risks Related to Our Business Operations and Industry

The increasing use of AI and machine learning in drug discovery and development introduces new and evolving risks that could harm our business and competitive position.

AI is increasingly playing a role in our industry, being used for target identification, drug discovery, preclinical modeling, clinical operations, and data analysis, among other things.

While it is not a significant factor in our current operations, AI may play a future role in our operations based upon our evaluation of its usefulness to us.

As with many new and emerging technologies, AI presents numerous risks and challenges that could adversely affect our business.

AI technologies are inherently complex and evolving.

They may not function as intended, produce accurate results, or provide actionable insights.

The quality of AI outputs depends heavily on the quality and quantity of input data, which in the life sciences context may be limited, biased, incomplete, or subject to regulatory and privacy constraints.

If we utilize AI in the future and our AI systems fail to achieve their intended purposes – such as identifying viable therapeutic candidates or targets, predicting biological outcomes, producing reproducible results, optimizing clinical trial designs or operations, and other similar or related purposes – our product development efforts may be delayed or unsuccessful.

If we are unable to successfully integrate and manage AI within our business, or if AI fails to deliver the expected benefits, our ability to develop rademikibart or any other new therapies could be materially adversely affected.

The industry in which we compete is characterized by rapid technological advancements, frequent introductions of new products and heavy competition.

The development of rademikibart and any other future product candidates is vital to our success.

The implementation of AI technologies and processes by us or by any third-party collaborators, including advanced predictive analytics, computational approaches and generative AI, has the potential to provide significant benefits in these areas.

Use of AI in our efforts may be difficult to deploy successfully due to operational issues inherent in such methods.

In particular, AI algorithms utilize machine learning and predictive analytics which may lead to flawed, biased, or inaccurate results, or exposure to competitive and reputational harm.

Even with the successful implementation of AI, we may fail to correctly identify indications and allocate resources efficiently, which could adversely impact our pipeline and ability to compete effectively.

Developing, testing and deploying resource-intensive AI systems may also require additional investment and increase our costs, and there is no guarantee that our investment in such systems would lead to more effective or efficient development of rademikibart or other investigational products, or lead to eventual regulatory approval or commercialization of any new products.

We also face increased competition from other companies that are using AI and related methods for drug discovery and development, some of which have more resources than we do and may have developed more effective methods than we and any third-party collaborators have, which may reduce our and any third-party collaborators’ effectiveness in identifying potential targets and attracting additional collaborators to work with us.

If our competitors are able to utilize new technologies more effectively (including but not limited to those that may involve AI or be created using AI) to discover, develop and commercialize products that compete with any of our product candidates or potential commercial products, such technologies could adversely impact our ability to compete.

Further, AI presents additional risks and challenges, especially as the use of these technologies becomes more important to our operations over time.

Generative AI may be used improperly or inappropriately which could lead to the tainting of our proprietary information and render us unable to qualify for certain patent or trade secret protection.

Its use by people, including our vendors, employees, suppliers and contractors, with access to our proprietary and confidential information, including trade secrets, may continue to increase and may lead to the release of such information, which may impact our ability to realize the benefit of our intellectual property.

The increasing use of AI and machine learning in drug discovery and development introduces new and evolving risks related to ownership, inventorship, and protection of intellectual property generated by or with the assistance of AI technologies.

Regulatory and legal frameworks governing AI-generated inventions are still developing and may create uncertainty regarding our ability to secure and enforce rights in such inventions.

Our use of generative AI platforms may lead to cybersecurity and privacy risks, which may adversely affect our operations and reputation, as well as the operations of any third-party collaborators.

Emerging ethical issues

surround the use of AI, and we may be subject to reputational and legal risk if our deployment or use of AI becomes controversial.

Regulators could limit our, or any third-party collaborator’s ability to develop or implement AI-based technologies as part of measures taken against us or any third-party collaborators in particular or as a consequence of broader legislation, which could have an adverse effect on our or any third-party collaborator’s business, results of operations and financial conditions.

The regulatory framework for AI technologies is rapidly evolving as many federal, state and foreign government bodies and agencies have enacted or are currently considering laws governing the development and use of AI/machine learning, such as the EU Artificial Intelligence Act (the “EU AI Act”) and the Colorado Artificial Intelligence Act.

The EU AI Act, which entered into force on August 1, 2024 and most provisions of which will become effective on August 2, 2026, sets out a risk-based framework, subjecting certain AI technologies to numerous compliance obligations, including transparency, conformity and risk assessment, monitoring and human oversight requirements.

Under the EU AI Act, non-compliant companies may be subject to administrative fines of up to 35 million Euros or 7% of a company’s total worldwide annual turnover for the preceding financial year, whichever is the higher.

Certain of our activities could subject us to the EU AI Act and depending on how the EU AI Act is implemented and interpreted, we may have to adapt our business practices, contractual arrangements, and services to comply with such obligations.

Furthermore, in the U.S., several states, including Colorado and California, enacted laws and regulations related to various AI uses, including AI used to make consequential decisions.

In addition, various federal regulators, such as the FDA, have issued guidance and focused enforcement efforts on the use of AI in regulated sectors.

If we develop or use AI systems governed by these laws or regulations, we would need to meet higher standards of data quality, transparency, monitoring and human oversight, and we would need to adhere to specific and potentially burdensome and costly ethical, accountability, and administrative requirements, with the potential for significant enforcement or litigation in the event of any perceived non-compliance.

We expect other jurisdictions will adopt similar laws.

Uncertainty in the legal regulatory regime may require significant resources to modify and maintain business practices to comply with U.S.

laws, the nature of which cannot be determined at this time.

Our operating results may fluctuate significantly, which makes our future operating results difficult to predict and could cause our operating results to fall below expectations or any guidance we may provide.

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This variability and unpredictability could also result in our failing to meet the expectations of industry or financial analysts or investors for any period.

If our revenue or operating results fall below the expectations of analysts or investors or below any forecasts we may provide to the market, or if the forecasts we provide to the market are below the expectations of analysts or investors, the price of our ADSs could decline substantially.

Such an ADS price decline could occur even when we have met any previously publicly stated revenue or earnings guidance we may provide.

If our revenue or operating results fall below the expectations of analysts or investors

or below any forecasts we may provide to the market, or if the forecasts we provide to the market are below the expectations of analysts or investors, the price of our ordinary shares could decline substantially.

Such a price decline could occur even when we have met any previously publicly stated revenue or earnings guidance we may provide.

We are dependent on the services of our management and other clinical and scientific personnel, and if we are not able to retain these individuals or recruit additional management or clinical and scientific personnel, our business will suffer.

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Although we have executed employment agreements or offer letters with each member of our senior management team, these agreements are terminable at will and, therefore, we may not be able to retain their services as expected.

We announced transitions in key leadership positions in the second of half of 2024, including transitions in the offices of Chief Executive Officer, President, Chief Development Officer, head of Finance, and General Counsel.

We announced transitions in key leadership positions in the second half of 2024, including transitions in the offices of Chief Executive Officer, President, Chief Development Officer, head of Finance, and General Counsel.

Management transitions may create uncertainty and involve a diversion of resources and management attention, be disruptive to our daily operations or impact public or market perception, any of which could negatively impact our ability to operate effectively or execute our strategies.

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Identifying, selecting and acquiring promising Product Candidates requires substantial technical, financial and human resources expertise.

Efforts to do so may not result in the actual acquisition or license of a particular Product Candidate, potentially resulting in a diversion of our management’s time and the expenditure of our resources with no resulting benefit.

Efforts to do so may not result in the actual acquisition or license of a

particular Product Candidate, potentially resulting in a diversion of our management’s time and the expenditure of our resources with no resulting benefit.

For example, if we are unable to identify programs that ultimately result in approved products, we may spend material amounts of our capital and other resources evaluating, acquiring and developing products that ultimately do not provide a return on our investment.

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Despite our efforts and the costs incurred and to be incurred, we may never succeed in obtaining regulatory approval for any of our Product Candidates, which could significantly harm our business, operating results, prospects or financial condition.

We may be exposed to liabilities under the U.S.

Foreign Corrupt Practices Act (the “FCPA”) and similar anti-corruption and anti-bribery laws of the PRC and other countries in which we operate, as well as U.S.

and foreign export controls, trade sanctions and import laws and regulations.

We may be exposed to liabilities under the FCPA and similar anti-corruption and anti-bribery laws of the PRC and other countries in which we operate, as well as U.S.

and foreign export controls, trade sanctions and import laws and

Compliance with these legal requirements could limit our ability to compete in foreign markets and any determination that we have violated these laws could have a material adverse effect on our business or our reputation.

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Efforts to ensure that our business arrangements with third parties will comply with applicable healthcare laws and regulations will involve substantial costs.

Any action against us for violation of these laws, even if we successfully defend

against it, could cause us to incur significant legal expenses and divert our management’s attention from the operation of our business.

Any action against us for violation of these laws, even if we successfully defend against it, could cause us to incur significant legal expenses and divert our management’s attention from the operation of our business.

The shifting compliance environment and the need to build and maintain robust and expandable systems to comply with multiple jurisdictions with different compliance and/or reporting requirements increases the possibility that we might run afoul of one or more of the requirements.

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It is possible that new and existing laws may be interpreted and applied in a manner that is inconsistent with our practices and our efforts to comply with the evolving data protection rules may be unsuccessful.

In the U.S., HIPAA, as amended by HITECH, and their implementing regulations, or collectively HIPAA, imposes, among other things, specific standards relating to the privacy, security, transmission and breach reporting of protected health information.

Most healthcare providers, including research institutions from which we obtain patient’s protected health information, are subject to privacy and security regulations promulgated under HIPAA.

While we do not believe that we are currently acting as a “covered entity” or “business associate” under HIPAA and thus are not directly regulated under HIPAA, any person may be prosecuted under HIPAA’s criminal provisions either directly or under aiding-and-abetting or conspiracy principles.

Consequently, depending on the facts and circumstances, we could face substantial criminal penalties if we knowingly receive protected health information from a HIPAA-covered healthcare provider or research institution that has not satisfied HIPAA’s requirements for disclosure of individually identifiable health information.

We may obtain health information from third parties, such as research institutions with which we collaborate, that are subject to privacy and security requirements under HIPAA.

Although we do not believe that we are directly subject to HIPAA, other than potentially with respect to providing certain employee benefits, we could be subject to criminal

penalties if we knowingly obtain or disclose individually identifiable health information maintained by a HIPAA covered entity in a manner that is not authorized or permitted by HIPAA.

Numerous states have also adopted data privacy and security laws and regulations, which govern the privacy, processing and protection of consumer health-related information and other personal information.

Such laws and regulations are subject to interpretation by various courts and other governmental authorities, thus creating potentially complex compliance issues for us and our future customers and strategic partners.

For example, the California Consumer Privacy Act of 2018 (the “CCPA”) went into effect on January 1, 2020 and was amended by the California Privacy Rights Act on January 1, 2023 (as amended, the “CPRA”).

The CPRA creates individual privacy rights for California consumers and increases the privacy and security obligations of entities handling specific personal information.

It also provides a private right of action for data breaches which has increased the likelihood of, and risks associated with, data breach litigation and creates a statutory damages framework.

In addition, the CPRA created a new state agency to oversee implementation and enforcement efforts.

Additional compliance investment and potential business process changes may be required as the CPRA evolves and is enforced.

Similar laws have passed in several other states, and have been proposed in other states and at the federal level, reflecting a trend toward more stringent privacy legislation in the U.S.

The enactment of such laws could have potentially conflicting requirements that would make compliance challenging.

If we are subject to or affected by HIPAA, the CPRA, or other U.S.

domestic privacy and data protection laws, any liability from failure to comply with the requirements of these laws could adversely affect our financial condition.

For example, the California Consumer Privacy Act of 2018, as amended by the California Privacy Rights Act (collectively, the “CCPA”) requires covered businesses that process the personal information of California residents to, among other things:

(i) provide certain disclosures to California residents regarding the business’s collection, use, and disclosure of their personal information;

(ii) receive and respond to requests from California residents to access, delete, and correct their personal information, or to opt out of certain disclosures of their personal information;

and (iii) enter into specific contractual provisions with service providers that process California resident personal information on the business’s behalf.

Similar laws have been enacted in other states, reflecting a trend toward more stringent privacy legislation in the U.S.

The enactment of such laws could have potentially conflicting requirements that would make compliance challenging and any failure or perceived failure to comply with the requirements of these laws could adversely affect our business, results of operations and financial condition.

Our operations in Europe and the United Kingdom, or the UK, may also be subject to increased scrutiny or attention from data protection authorities.

For example, the EU General Data Protection Regulation (“EU GDPR”) and the United Kingdom General Data Protection Regulation and Data Protection Act 2018 (together, the “UK GDPR”) (the EU GDPR and UK GDPR together referred to as the “GDPR”), impose comprehensive data privacy compliance requirements in relation to the processing of personal information of individuals.

The GDPR increases our obligations with respect to clinical trials conducted in the EU and the UK by, for example, expanding the definition of personal information to include coded or pseudonymized data and imposing specific requirements regarding informed consent practices and the provision of detailed notices for clinical trial subjects and investigators.

The GDPR imposes stringent obligations with respect to clinical trials conducted in the EU and the UK including specific requirements regarding consent and the provision of detailed notices for data subjects such as clinical trial subjects and investigators.

In addition, some of the personal information we process in respect of clinical trial participants is special category or sensitive personal information under the GDPR and subject to additional compliance obligations and local law derogations.

We may be subject to diverging requirements under EU member state laws and UK law, such as whether consent can be used as a legal basis for processing and the roles,

responsibilities and liabilities between the different parties involved in clinical trials.

We may be subject to diverging requirements under EU member state laws and UK law, such as whether consent can be used as a legal basis for processing and the roles, responsibilities and liabilities between the different parties involved in clinical trials.

As these laws develop, we may need to make operational changes to adapt to these diverging rules, which could increase our costs and adversely affect our business.

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In addition, the GDPR confers a private right of action on data subjects and consumer associations to lodge complaints with supervisory authorities, seek judicial remedies, and obtain compensation for damages resulting from violations of the GDPR.

In relation to cross-border transfers, case law from the Court of Justice of the European Union (“CJEU”) states that reliance on the standard contractual clauses - a standard form of contract approved by the European Commission as an adequate personal information transfer mechanism - alone may not necessarily be sufficient in all circumstances and that transfers must be assessed on a case-by-case basis.

In relation to cross-border transfers, case law from the Court of Justice of the European Union states that reliance on the standard contractual clauses - a standard form of contract approved by the European Commission as an adequate personal information transfer mechanism - alone may not necessarily be sufficient in all circumstances and that transfers must be assessed on a case-by-case basis.

In relation to data transfers to the US, the EU-US Data Privacy Framework (“DPF”) was approved by the European Commission in July 2023 as an effective EU GDPR data transfer mechanism to U.S.

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entities self-certified under the UK Extension to the DPF.

We expect the existing legal complexity and uncertainty regarding international personal information transfers to continue under the UK GDPR and EU GDPR.

In particular, we expect the DPF to be challenged and international transfers to the U.S.

and to other jurisdictions more generally to continue to be subject to enhanced scrutiny by regulators.

We expect the existing legal complexity and uncertainty regarding international personal data transfers to continue under the UK GDPR and EU GDPR.

Further, the U.S.

Department of Justice (the “DOJ”) recently issued a final rule that went into effect in April 2025 and is fully enforceable as of July 9, 2025, known as the “Data Security Program” (the “DSP Rule”).

The DSP Rule is aimed at preventing access to “bulk U.S.

sensitive personal data” and “government-related data” by “countries of concern” (including China, Russia, Iran, North Korea, Cuba, and Venezuela) and “covered persons” (as all such terms are defined in the DSP) and imposes stringent obligations on companies within its scope and prohibits or restricts “covered data transactions” that grant countries of concern or covered persons access to bulk U.S.

sensitive personal data or any amount of government-related data.

The DSP is new, complex and has yet to be enforced, and as such, there is a risk that our interpretation of its applicability, scope, and requirements is incorrect, incomplete, or misapplied.

We do not believe that we are currently engaged in covered data transactions that implicate the DSP Rule, but we may engage in such transactions in the future, in which case any such transactions could be restricted and subject to certain compliance obligations under the DSP Rule, including with respect to cybersecurity, recordkeeping, reporting and auditing.

As the regulatory guidance and enforcement landscape in relation to data transfers continue to develop, we could suffer additional costs, complaints and/or regulatory investigations or fines;

we may have to stop using certain tools and vendors and make other operational changes;

we may have to implement alternative transfer mechanisms under the GDPR and/or take additional compliance and operational measures;

we may have to implement alternative transfer mechanisms and/or take additional compliance and operational measures;

and/or it could otherwise affect the manner in which we provide our services, and could adversely affect our business, operations and financial condition.

On January 31, 2022, the CTR entered into application.

This regulation imposes obligations on the use of data generated from clinical trials and enables the EU patients to have the opportunity to access information about clinical trials.

As we continue to expand into other foreign countries and jurisdictions, we may be subject to additional laws and regulations that may affect how we conduct business.

As we continue to expand into other foreign countries and jurisdictions, we may be subject to additional, similar laws and regulations that may affect how we conduct business.

Regulatory authorities in the PRC have implemented and are considering a number of legislative and regulatory proposals concerning data protection.

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In May 2023, the MOST published the Implementing Rules for the Regulations of the PRC on the Administration of Human Genetic Resources, which offered certain clarification on the definition of non-PRC parties, the scope of international collaboration, HGR Information and HGR Materials, as well as criteria for security review.

In March 2023, the 14th National People’s Congress announced a restructuring of the State Council, under which the HGR approval authorities were transferred from MOST to the National Health Commission (the

This move was in alignment with the amended Regulation on the Administration of Human Genetic Resources, which was amended in March 2024 and took effect in May 2024.

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On January 2, 2013, the American Taxpayer Relief Act of 2012 was signed into law, which, among other things, reduced Medicare payments to several providers, including hospitals, and increased the statute of limitations period for the government to recover overpayments to providers from three to five years.

On March 11, 2021, former President Biden signed the American Rescue Plan Act of 2021 into law, which eliminated the statutory Medicaid drug rebate cap, beginning January 1, 2024.

On March 11, 2021, the American Rescue Plan Act of 2021 was signed into law, which eliminated the statutory cap on manufacturers’ Medicaid drug rebate liability, beginning January 1, 2024.

The rebate was previously capped at 100% of a drug’s average manufacturer price.

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of pharmaceutical pricing practices in light of the rising cost of prescription drugs.

Such scrutiny has resulted in several recent congressional inquiries and proposed and

enacted federal and state legislation designed to, among other things, bring more transparency to product pricing, review the relationship between pricing and manufacturer patient programs, and reform government program reimbursement methodologies for products.

Such scrutiny has resulted in several recent congressional inquiries and proposed and enacted federal and state legislation designed to, among other things, bring more transparency to product pricing, review the relationship between pricing and manufacturer patient programs, and reform government program reimbursement methodologies for products.

In August 2022, the IRA was signed into law.

Among other things, the IRA imposes inflation rebates on drug and biological product manufacturers for products reimbursed under Medicare Parts B and D to if the prices of those products increase faster than inflation, which began in 2023;

implements changes to the Medicare Part D benefit that, beginning in 2025, cap benefit annual out-of-pocket spending at $2,000, with new discount obligations for pharmaceutical manufacturers;

implements changes to the Medicare Part D benefit that cap benefit annual out-of-pocket spending at $2,000, with new discount obligations for pharmaceutical manufacturers, which began in 2025;

and, beginning in 2026, establishes a “maximum fair price” for a fixed number of pharmaceutical and biological products covered under Medicare Parts B and D following a price negotiation process with CMS.

CMS has published the negotiated prices for the initial ten drugs, which will first be effective in 2026, and has published the list of the subsequent 15 drugs that will be subject to negotiation.

CMS published the negotiated prices for the initial ten drugs, which went into effect in 2026, and the subsequent 15 drugs, which will first be effective in 2027, as well as the next set of 15 drugs that will be subject to negotiation, although the Medicare drug price negotiation program is currently subject to legal challenges.

The IRA permits the Secretary of the Department of Health and Human Services (“HHS”) to implement many of these provisions through guidance, as opposed to regulation, for the initial years.

HHS has and will continue to issue and update guidance as these programs are implemented, although the Medicare drug price negotiation program is currently subject to legal challenges.

HHS has and will continue to issue and update guidance as these programs are implemented.

For that and other reasons, it is currently unclear how the IRA will be effectuated.

Similar or other drug pricing proposals or other healthcare reform measures could appear in future legislation, particularly in light of the new Presidential administration.

Similar or other drug pricing proposals or other healthcare reform measures could appear in future legislation.

In July 2025, the OBBBA was enacted, which imposes significant reductions in the funding of the Medicaid program and restrictions for certain groups to access the ACA Marketplace.

These changes are expected to decrease the number of persons enrolled in Medicaid and reduce the services covered by Medicaid, and may result in an increase in the number of individuals who are unable to access health insurance benefits and medical care, either of which could adversely affect our sales of any product candidate that we commercialize.

The Trump administration is pursuing a two-fold strategy to reduce drug costs in the U.S.

President Trump has threatened to impose significant tariffs on pharmaceutical manufacturers that do not adopt pricing policies such as most favored nation pricing, which would tie the price for drugs in the U.S.

to the lowest price in a group of other countries.

response, multiple manufacturers have reportedly entered into confidential pricing agreements with the federal government.

The Trump administration is also pursuing traditional regulatory pathways to impose drug pricing policies, and published two proposed regulations in December 2025, referred to as Globe and Guard.

If finalized, these regulations would implement mandatory payment models under which manufacturers of eligible drugs would be required to pay rebates to the federal government on a portion of the units of their drugs that are reimbursed by Medicare, with the rebate amount based on most favored nation pricing.

While the impact of the Globe and Guard proposed regulations, if finalized, cannot yet be determined, it is likely to be significant.

Even regulatory proposals or executive actions that are ultimately deemed unlawful could negatively impact the U.S.

pharmaceutical sector and our business.

In addition, pharmaceutical pricing and marketing has long been the subject of considerable discussion in Congress and among policymakers, and it is possible that Congress could enact additional laws that negatively affect the pharmaceutical industry.

At the state level, legislatures have increasingly passed legislation and implemented regulations designed to address pharmaceutical and biological product pricing, including transparency measures that require the disclosure of prices, including price changes, marketing costs, and research costs, among others.

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The HTA Regulation intends to boost cooperation among EU member states in assessing health technologies, including new medicinal products, and provide the basis for cooperation at the EU level for joint clinical assessments in these areas.

It will permit EU member states to use common HTA tools, methodologies, and procedures across the EU, working together in four main areas, including joint clinical assessment of the innovative health technologies with the highest potential impact for patients, joint scientific consultations whereby developers can seek advice from HTA authorities, identification of emerging health technologies to identify promising technologies early, and continuing voluntary

cooperation in other areas.

Individual EU member states will continue to be responsible for assessing non-clinical (e.g., economic, social, ethical) aspects of health technology, and making decisions on pricing and reimbursement.

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• the inability to commercialize our Product Candidates;

• a decline in our ADS price.

• a decline in our ordinary share price.

We may need to increase our insurance coverage as we expand our clinical trials or if we commence commercialization of our Product Candidates.

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In the ordinary course of our business, we, and certain of our third-party providers, collect, maintain, store, process and transmit large amounts of information about our customers, employees, business partners, and other types of information, including confidential information, intellectual property, proprietary business information, clinical trial data, protected health information, and personal information, collectively “Confidential Information”.

It is critical that we do so in a secure manner to maintain the confidentiality and integrity of our Confidential Information .

In particular, any adverse impact to the availability, integrity, or confidentiality of our IT Systems or Confidential Information can result in legal claims or proceedings (such as class actions), regulatory investigations and enforcement actions, fines and penalties, and negative reputational impact, any or all of which could materially adversely affect our business, operating results, and financial condition.

Despite the implementation of security measures, there can be no assurance that our cybersecurity risk management program and processes, including our policies, controls, or procedures, will be fully implemented, complied with or effective in protecting our IT Systems and Confidential Information.

Any adverse impact to the availability, integrity, or confidentiality of our IT Systems or Confidential Information can result in legal claims or proceedings (such as class actions), regulatory investigations and enforcement actions, fines and penalties, and negative reputational impact, any or all of which could materially adversely affect our business, operating results, and financial condition.

Despite the implementation of our security measures, there can be no assurance that our cybersecurity risk management program and processes, including our policies, controls, or procedures, will be fully implemented, complied with or effective in protecting our IT Systems and Confidential Information.

In particular, we face numerous and evolving cybersecurity risks that threaten the confidentiality, integrity, and availability of our IT Systems and Confidential Information.

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Cybersecurity incidents, including cyberattacks, cybersecurity breaches, computer viruses, malware and other incidents could cause misappropriation, loss or other unauthorized disclosure of Confidential Information.

Increasingly complex methods, including through the use of artificial intelligence, have been used in cyberattacks, including ransomware, phishing, structured query language injections and distributed denial-of-service attacks.

Increasingly complex methods, including through the use of AI, have been used in cyberattacks, including ransomware, phishing, structured query language injections and distributed denial-of-service attacks.

We and some of our Third Parties are from time to time subject to cyberattacks and cybersecurity incidents.

For example, in May 2021, we experienced a phishing attack through the e-mail account of one of our employees.

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Though we recovered some of the loss from our cybersecurity insurance provider, the incident resulted in certain financial losses that we were not able to fully recover from our provider.

If such an event were to occur again and cause interruptions in our operations or result in the unauthorized use, disclosure of or access to Confidential Information, it could result in a material disruption of our development programs and our business operations, whether due to a loss of our trade secrets or other similar disruptions cause us to breach our contractual obligations, subject us to mandatory corrective action, and otherwise subject us to liability under laws, regulations and contracts that protect the privacy and security of Confidential Information, which could result in significant legal and financial exposure and reputational damages.

The risk of a data security breach or disruption has generally increased as the number, intensity and sophistication of attempted attacks and intrusions from around the world have increased in the recent years.

Further, as a result of continued hybrid working environment, we may also face increased cybersecurity risks due to our reliance on internet and cloud technologies.

We are dependent upon our IT Systems to operate our business, given the number of our employees who are working remotely, and such dependence may create additional opportunities for cybercriminals to exploit vulnerabilities.

The techniques used by cybercriminals change frequently, may not be recognized until launched, and can originate from a wide variety of sources, including outside groups such as external service providers, organized crime affiliates, hacktivists, terrorist organizations or hostile foreign governments or agencies.

We also face increased cybersecurity risks due to our reliance on internet technology and the increased number of our employees (and employees of our vendors, contractors and other organizations with whom we have formed strategic relationships) who are working remotely, which may create additional opportunities for cybercriminals to exploit vulnerabilities.

Additionally, any integration of AI into our or any third party’s operations, products or services is expected to pose new or unknown cybersecurity risks and challenges.

Further, the techniques used by cybercriminals change frequently, may not be recognized until launched, and can originate from a wide variety of sources, including outside groups such as external service providers, organized crime affiliates, hacktivists, terrorist organizations or hostile foreign governments or agencies.

As such, we may also experience cybersecurity breaches that may remain undetected for an extended period.

Even if identified, we may be unable to adequately investigate or remediate incidents or breaches due to attackers increasingly using tools and techniques that are designed to circumvent controls, to avoid detection, and to remove or obfuscate forensic evidence.

We and some of our Third Parties are from time to time subject to cyberattacks and cybersecurity incidents.

contracts that protect the privacy and security of Confidential Information, which could result in significant legal and financial exposure and reputational damages.

Despite our contractual protections with such Third Parties, notifications and follow-up actions related to a cybersecurity breach could impact our brand and reputation, cause us to incur significant costs, including legal expenses, harm customer confidence and trust, hurt our expansion into new markets, cause us to incur remediation costs, or cause us to lose existing customers.

Despite our contractual protections with Third Parties, notifications and follow-up actions related to a cybersecurity breach could impact our brand and reputation, cause us to incur significant costs, including legal expenses, harm customer confidence and trust, hurt our expansion into new markets, cause us to incur remediation costs, or cause us to lose existing

We also rely on Third Parties to manufacture our Product Candidates, and similar events relating to their IT Systems could also have a material adverse effect on our business.

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For details of our cybersecurity measures, strategies and governance, see Item 1C.

“Cybersecurity - Cybersecurity Risk Management, Strategy and Governance.”

“Cybersecurity.”

Our employees and independent contractors, including principal investigators, CROs, consultants and vendors, may engage in misconduct or other improper activities, including noncompliance with regulatory standards and requirements.

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In addition, we are subject to the risk that a person or government could allege such fraud or other misconduct, even if none occurred.

If any such actions are instituted against us, and we are not successful in defending ourselves or asserting our rights, those actions could have a significant impact on our business and financial results, including, without limitation, the imposition of significant civil, criminal and administrative penalties, damages, monetary fines, disgorgements, possible exclusion from participation in Medicare, Medicaid and other healthcare programs, individual imprisonment, contractual damages, reputational harm, diminished profits and future earnings, additional reporting requirements and oversight if we become subject to a corporate integrity agreement or similar agreement to resolve allegations of non-compliance with these

laws, and curtailment of our operations, any of which could adversely affect our ability to operate our business and our results of operations.

We may engage in strategic transactions that could impact our liquidity, increase our expenses and present significant distractions to our management.

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In addition, we may have, arrangements with governmental authorities that have obligations or responsibilities that we cannot successfully fulfill with potentially significant adverse consequences to us.

Any future transactions could increase our near and long-term expenditures, result in potentially dilutive issuances of our equity securities, including our ADSs, or the incurrence of debt, contingent liabilities, amortization expenses or acquired in-process research and development expenses, any of which could affect our financial condition, liquidity and results of operations.

Any future transactions could increase our near and long-term expenditures, result in potentially dilutive issuances of our equity securities, or the incurrence of debt, contingent liabilities, amortization expenses or acquired in-process research and development expenses, any of which could affect our financial condition, liquidity and results of operations.

Additional potential transactions that we may consider in the future include a variety of business arrangements, including spin-offs, strategic partnerships, joint ventures, restructurings, divestitures, business combinations and investments.

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laws and policies, such as laws and policies surrounding international trade, foreign affairs, manufacturing and development and investment in the territories and countries where we or our customers partners, vendors, and others operate, can materially and adversely affect our business, financial condition and results of operations.

President Donald Trump has imposed tariffs on certain foreign products, including most recently from Canada, Mexico and China, that in the past have resulted in and may result in future retaliatory tariffs on U.S.

President Donald Trump has imposed tariffs on certain foreign products that in the past have resulted in and may result in future retaliatory tariffs on U.S.

goods and products.

The continuation of these tariffs or the implementation of new tariffs on imports from Canada, Mexico, and China or other countries remains to be seen, but if tariffs are imposed or increased, the price of our clinical supplies could increase.

The continuation of these tariffs or the implementation of new tariffs on imports from additional countries remains to be seen, but if tariffs are imposed or increased, the price of our clinical supplies could increase.

This, and similar trade restrictions in the future, may have a material and adverse effect on our business, financial condition and results of operations.

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There can be no assurance that our current or future patent applications or the patent applications of our future licensors will be considered patentable by the USPTO courts in the U.S., the China National Intellectual Property Administration (the “CNIPA”) courts in the PRC or by the patent offices and courts in other jurisdictions or will result in patents being issued.

In addition, there can be no assurance that any issued patents will afford sufficient protection against

competitors or other third parties with similar technology, or will not be infringed, designed around or invalidated.

In addition, there can be no assurance that any issued patents will afford sufficient protection against competitors or other third parties with similar technology, or will not be infringed, designed around or invalidated.

Even issued patents may later be found invalid or unenforceable, in whole or in part, or may be modified or revoked in proceedings instituted by third parties before various patent offices or in courts.

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If, for any reason, any license agreement is terminated or we otherwise lose the rights associated with such license, it could adversely affect our business.

Any collaboration agreement or license agreement we have entered into, or are likely to enter into, imposes or is likely to impose, various development, commercialization, funding, diligence, sublicensing, insurance, patent prosecution and enforcement or other obligations on us, as well as milestone, royalty, annual maintenance and other payment obligations.

Any collaboration

agreement or license agreement we have entered into, or are likely to enter into, imposes or is likely to impose, various development, commercialization, funding, diligence, sublicensing, insurance, patent prosecution and enforcement or other obligations on us, as well as milestone, royalty, annual maintenance and other payment obligations.

If we breach any material obligations, or use the intellectual property licensed to us in an unauthorized manner, or if, in spite of our efforts, a collaborator or future licensor concludes that we have materially breached our obligations under such agreement, we may be required to pay damages and the future licensor may have the right to terminate the license, which could result in us being unable to develop, manufacture, have manufactured, and commercialize products that are covered by the licensed technology or having to negotiate new or reinstated licenses on less favorable terms, or enable a competitor or other third party to gain access to the licensed technology.

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These agreements may be complex, and some provisions in such agreements may be susceptible to multiple interpretations.

The resolution of any contract interpretation disagreement that may arise could narrow what we believe to be the scope of our rights to the relevant intellectual property or technology, or increase what we believe to be our financial

or other obligations under the relevant agreement.

Moreover, if disputes over intellectual property that we have licensed prevent or impair our ability to maintain our current licensing arrangements on acceptable terms, we may not be able to successfully develop and commercialize the affected Product Candidates.

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If any such challenges to inventorship or ownership were asserted, there is no assurance that a court would find in our favor or that, if we choose to seek a license, such license would be available to us on acceptable terms or at all.

Moreover, we may be subject to a third-party submission of prior art to the USPTO challenging the priority of an invention claimed within one of our patents or patent

applications (which submissions may be made prior to a patent’s issuance) or otherwise become involved in pre- and post-issuance proceedings, including opposition, derivation, re-examination, revocation, inter partes review, post-grant review, interference or other proceedings challenging our patent rights or the patent rights of others from whom we have obtained licenses to such rights.

Moreover, we may be subject to a third-party submission of prior art to the USPTO challenging the priority of an invention claimed within one of our patents or patent applications (which submissions may be made prior to a patent’s issuance) or otherwise become involved in pre- and post-issuance proceedings, including opposition, derivation, re-examination, revocation, inter partes review, post-grant review, interference or other proceedings challenging our patent rights or the patent rights of others from whom we have obtained licenses to such rights.

For example, if we or a future licensor or other future collaborator initiate legal proceedings against a third party to enforce a patent covering one of our Product Candidates, the defendant could counterclaim that the patent covering our Product Candidate is invalid or unenforceable.

An adverse determination in any such submission, proceeding or litigation could reduce the scope of, or invalidate, our patent rights, in whole or in part, allow third parties to commercialize our technology or products and compete directly with us, without payment to us, or result in our inability to manufacture, have manufactured, or commercialize products without infringing third-party patent rights.

An adverse determination in any such submission, proceeding or litigation could reduce the scope of, or invalidate, our patent rights, in whole or in part, allow third parties to

commercialize our technology or products and compete directly with us, without payment to us, or result in our inability to manufacture, have manufactured, or commercialize products without infringing third-party patent rights.

Any loss of patent rights, loss of exclusivity or patent claims being narrowed, invalidated or held unenforceable, in whole or in part, could limit our ability to stop others from using or commercializing similar or identical technology and products, without payments to us, limit the duration of the patent protection of our current or any future Product Candidates, or result in our inability to manufacture, have manufactured, and commercialize our Product Candidates, which could materially and adversely impact our business.

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If we are limited in our ability to utilize acquired or licensed technologies, or if we lose our rights to critical in-licensed technology, we may be unable to successfully develop, out-license, market and sell our products, which could prevent or delay new product introductions.

Our business strategy depends on the successful development of licensed and

acquired technologies into commercial products.

Our business strategy depends on the successful development of licensed and acquired technologies into commercial products.

Therefore, any limitations on our ability to utilize these technologies may impair our ability to develop, out-license or market and sell our Product Candidates.

Any of the foregoing could have a material adverse effect on our business, financial condition, results of operations and prospects.

If we are not successful in obtaining patent term extensions for our current and future Product Candidates, our business may be harmed, and the lack of effective enforcement of patent linkage and the absence of patent term extension and data and market exclusivity for Product Candidates approved by the NMPA could increase the risk of early generic competition with our products in the PRC.

NMPA or FDA could increase the risk of early generic competition with our products in the PRC, the U.S., or other territories.

Patents have a limited lifespan.

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Similarly, the U.S.

Orphan Drug Act provides seven years of market exclusivity for some drugs to treat rare diseases, where the FDA designates the product candidate as an orphan drug and the drug is approved for the designated orphan disease or condition.

These provisions, designed to promote innovation, can prevent competing products from entering the market for a period of time after the FDA grants marketing approval for the innovative product.

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Periodic maintenance fees on any issued patent are due to be paid to the USPTO, CNIPA and other foreign patent agencies in several stages over the lifetime of the patent.

In addition, the USPTO, CNIPA and various foreign national or international patent agencies require compliance with a number of procedural, documentary, fee payment and other similar

provisions during the patent application process.

In addition, the USPTO, CNIPA and various foreign national or international patent agencies require compliance with a number of procedural, documentary, fee payment and other similar provisions during the patent application process.

While an inadvertent lapse can in many cases be cured by payment of a late fee or by other means in accordance with the applicable rules, there are situations in which noncompliance can result in abandonment or lapse of the patent or patent application, resulting in partial or complete loss of patent rights in the relevant jurisdiction.

Noncompliance events that could result in abandonment or lapse of patent rights include, but are not limited to, failure to timely file national and regional stage patent applications based on an international patent application, failure to respond to official actions within prescribed time limits, non-payment of fees and failure to properly legalize and submit formal documents within prescribed time limits.

formal documents within prescribed time limits.

There could also be delays at the USPTO caused by staffing cuts and other U.S.

government actions as a result of the U.S.

Department of Government Efficiency or other executive actions to reduce the size of the U.S.

If we fail to maintain patents and patent applications, whether owned or in-licensed now or in the future, covering any of our current or future Product Candidates and technologies, our competitors might be able to enter the market, which would have an adverse effect on our business, financial condition, results of operations and prospects.

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There may be third-party patents or patent applications with claims to materials, formulations, methods of manufacture or methods for treatment related to the use or manufacture of our current and future Product Candidates.

Because patent applications can take many years to issue and may be confidential for 18 months or more after filing, and

because pending patent claims can be revised before issuance, there may be currently pending patent applications—including ones we are unaware of—that may later result in issued patents that our current and future Product Candidates may infringe.

Because patent applications can take many years to issue and may be confidential for 18 months or more after filing, and because pending patent claims can be revised before issuance, there may be currently pending patent applications—including ones we are unaware of—that may later result in issued patents that our current and future Product Candidates may infringe.

In addition, third parties may obtain patents in the future and claim that use of our technologies infringes upon these patents.

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There could also be public announcements of the results of hearings, motions or other interim proceedings or developments.

If securities analysts or investors perceive these results to be negative, it could have an adverse effect on the price of our ADSs or ordinary shares.

If securities analysts or investors perceive these results to be negative, it could have an adverse effect on the price of our ordinary shares.

Any of the foregoing would have a material adverse effect on our business, financial condition, results of operations and prospects.

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We may be unable to acquire or in-license any compositions, methods of use, processes or other third-party intellectual property rights from third parties that we identify as necessary for our current and any future Product Candidates.

The licensing and acquisition of third-party intellectual property rights is a competitive area, and a number of more established companies are also pursuing strategies to license or acquire third-party intellectual property rights that we may consider attractive.

The licensing and acquisition of third-party intellectual property rights is a competitive area, and a number of

more established companies are also pursuing strategies to license or acquire third-party intellectual property rights that we may consider attractive.

These established companies may have a competitive advantage over us due to their size, cash resources and greater clinical development and commercialization capabilities.

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There could also be public announcements of the results of hearings, motions or other interim proceedings or developments.

If securities analysts or investors perceive these results to be negative, it could have an adverse effect on the price of our ADSs or ordinary shares.

If securities analysts or investors perceive these results to be negative, it could have an adverse effect on the price of our ordinary shares.

Any of the foregoing could have a material adverse effect on our business, financial condition, results of operations and prospects.

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An unfavorable outcome could require us to cease using the related technology or to attempt to license rights to it from the prevailing party.

Our business could be harmed if the prevailing party does not offer us a license on commercially reasonable terms or at all.

Our business could be

harmed if the prevailing party does not offer us a license on commercially reasonable terms or at all.

Our defense of such proceedings may fail and, even if successful, may result in substantial costs and distract our management and other employees.

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Therefore, the Leahy-Smith Act and its implementation could make it more difficult to obtain patent protection for our inventions and increase the uncertainties and costs surrounding the prosecution of our patent applications and the enforcement or defense of our issued patents, all of which could harm our business, results of operations and financial condition.

Similarly, the PRC also adopted a “first-to-file” system.

Similarly, the PRC and other international territories have adopted a “first-to-file” system.

There remain many subsisting issued patents and some pending patent applications in the U.S.

that were filed prior to its enactment and are therefore subject to the pre-Leahy-Smith Act U.S.

patent laws and that may be relevant to our freedom-to-operate or ability to obtain patent issuances.

The Leahy-Smith Act also includes a number of significant changes that affect the way patent applications will be prosecuted and also may affect patent litigation.

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In 2012, the European Patent Package (“EU Patent Package”) regulations were passed with the goal of providing a single pan-European Unitary Patent and a new European Unified Patent Court (“UPC”) for litigation involving European patents.

Implementation of the EU Patent Package occurred in 2023.

Implementation of the EU Patent Package occurred in 2023 and the UPC and has become a common forum for challenging patents in the pharmaceutical space.

Under the UPC, all European patents, including those issued prior to ratification of the European Patent Package, will by default automatically fall under the jurisdiction of the UPC.

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Under the EU Patent Package, we will have the right to opt our patents out of the UPC over the first seven years of the court’s existence, but doing so may preclude us from realizing the benefits of the new unified court.

We may not be able to protect our intellectual property rights throughout the world, including in the PRC.

We may not be able to protect our intellectual property rights throughout the world, including in the U.S., Europe and the PRC.

Filing, prosecuting and defending patents for our current and future Product Candidates in all relevant jurisdictions throughout the world could be prohibitively expensive, and our intellectual property rights in some countries outside the U.S.

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or other jurisdictions.

Competitors may use our technologies in jurisdictions where we have not obtained patent protection to develop their own products and, further, may export otherwise infringing products to territories where we have patent protection but enforcement is not as strong as that in the U.S.

These products may compete with our current or any future Product Candidates, and our patents, the patents of our future licensors or other intellectual property rights may not be effective or sufficient to prevent them from competing.

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Compulsory standards for remuneration to creators or inventors of the patents they contribute to our business could be considerable.

Under PRC laws, we are required to remunerate inventors or creators of patents they create for our business during the course of their employment.

Under PRC laws, for example, we are required to remunerate inventors or creators of patents they create for our business during the course of their employment.

In the event of a dispute between an inventor or creator and us, there is a risk that the compulsory standards for remuneration, as set forth in relevant laws and regulations, could apply.

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We also rely on the protection of our trade secrets, including unpatented know-how, technology and other proprietary information, to maintain our competitive position.

Although we have taken steps to protect our trade secrets and

unpatented know-how, including entering into confidentiality agreements with third parties, and confidential information and inventions agreements with employees, consultants, CROs and advisors, we cannot provide any assurances that we have entered into such agreements with each party that may have or have had access to our trade secrets or proprietary information and that all such agreements have been duly executed, and any of these parties may breach the agreements and disclose or use our proprietary information, including our trade secrets, and we may not be able to obtain adequate remedies for such breaches.

Although we have taken steps to protect our trade secrets and unpatented know-how, including entering into confidentiality agreements with third parties, and confidential information and inventions agreements with employees, consultants, CROs and advisors, we cannot provide any assurances that we have entered into such agreements with each party that may have or have had access to our trade secrets or proprietary information and that all such agreements have been duly executed, and any of these parties may breach the agreements and disclose or use our proprietary information, including our trade secrets, and we may not be able to obtain adequate remedies for such breaches.

Monitoring unauthorized uses and disclosures of trade secrets and other confidential information is difficult, and we do not know whether the steps we have taken to protect our trade secrets or confidential information will be effective.

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Competitors or other parties may adopt trade names or trademarks similar to ours, thereby impeding our ability to build brand identity and possibly leading to market confusion.

In addition, they may infringe our trademarks and we may not have adequate resources to enforce our trademarks.

If we attempt to enforce our trademarks and assert trademark infringement claims, a court may determine that the marks we have asserted are invalid or unenforceable, or that the party against whom we have asserted trademark

infringement has superior rights to the marks in question.

In addition, they may infringe our trademarks and we may not have adequate resources to enforce our

In this case, we could ultimately be forced to cease use of such trademarks.

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Should any of these events occur, they could have a material adverse effect on our business, financial condition, results of operations and prospects.

Risks Related to Ownership of Our ADSs

The trading price of our ADSs could be highly volatile, and purchasers of our ADSs could incur substantial losses.

The trading price of our ADSs has been and may continue to be volatile.

Risks Related to Ownership of Our Ordinary Shares

The trading price of our ordinary shares could be highly volatile, and purchasers of our ordinary shares could incur substantial losses.

The trading price of our ordinary shares has been and may continue to be volatile.

The stock market in general and the market for shares of biopharmaceutical companies in particular have experienced extreme volatility that has often been unrelated to the operating performance of particular companies.

As a result of this volatility, some or all of the value of our ADSs may be lost.

The market price for our ADSs may be influenced by those factors discussed in this “Risk Factors” section and many others, including:

As a result of this volatility, some or all of the value of our ordinary shares may be lost.

The market price for our ordinary shares may be influenced by those factors discussed in this “Risk Factors” section and many others, including:

• political tensions between the U.S.

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• market conditions in the biopharmaceutical sector and issuance of securities analysts’ reports or recommendations;

• trading volume of our ADSs;

• trading volume of our ordinary shares;

• an inability to obtain additional funding;

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Such litigation, if instituted against us, could cause us to incur substantial costs and divert management’s attention and resources, which could have a material adverse effect on our business, financial condition and results of operations.

Unstable market and economic conditions may have serious adverse consequences on our business, financial condition and results of operations and the price of our ADSs.

Unstable market and economic conditions may have serious adverse consequences on our business, financial condition and results of operations and the price of our ordinary shares.

From time to time, the global credit and financial markets have experienced extreme volatility and disruptions, including severely diminished liquidity and credit availability, declines in consumer confidence, declines in economic growth, increases in unemployment rates and uncertainty about economic stability.

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Our business strategy and performance may be adversely affected by any such economic downturn, volatile business environment or continued unpredictable and unstable market conditions.

The financial markets and the global economy may also be adversely affected by the current or anticipated impact of military conflict, including the Russia-Ukraine war and terrorism or other geopolitical events.

The financial markets and the global economy may also be adversely affected by the current or anticipated impact of military conflict, including the Russia-Ukraine war, developments in Iran and Venezuela, and terrorism or other geopolitical events.

Sanctions imposed by the U.S.

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If the current equity and credit markets deteriorate, it may make any necessary debt or equity financing more difficult, more costly and more dilutive.

Failure to secure any necessary financing in a timely manner and on favorable terms could have a material adverse effect on our business, financial condition and results of operations and the price of our ADSs.

If we fail to meet the continued listing requirements of Nasdaq, it could result in a delisting of our ADSs.

Our ADSs are listed on the Nasdaq Global Market.

If we fail to meet the continued listing requirements of Nasdaq, it could result in a delisting of our ordinary shares.

Our ordinary shares are listed on the Nasdaq Global Market.

In order to maintain our listing, we must meet minimum financial and other requirements, including requirements for a minimum closing bid price per share of $1.00 (the “Minimum Bid Price Requirement”), a minimum amount of capital, and various corporate governance requirements.

On March 24, 2025, we received a letter from the Listings Qualifications Department of the Nasdaq indicating a failure to comply with the Minimum Bid Price Requirement because the bid price for our ADSs had closed below $1.00 for 30 consecutive business days.

In accordance with Nasdaq Listing Rule 5810(c)(3)(A), we were provided an initial period of 180 calendar days, or until September 22, 2025 (the first business day after the 180-day period), to regain compliance with the Minimum Bid Price Requirement.

The letter states that the Nasdaq staff will provide written confirmation of compliance if at any time during this 180-day period, the closing bid price of our ADSs is at least $1.00 for a minimum of 10 consecutive business days.

The Nasdaq letter has no immediate effect on the listing or trading of our ADSs, and our ADSs will continue to trade on the Nasdaq Global Market under the symbol “CNTB.” We have in the past been subject to similar notifications from Nasdaq, and we cannot assure investors that we will be able to regain compliance with applicable Nasdaq requirements or continue to comply with such requirements in the future.

In the event that our ADSs are delisted from the Nasdaq Global Market and are not eligible for quotation or listing on another market or exchange, trading of our ADSs could be conducted only in the over-the-counter market or on an electronic bulletin board established for unlisted securities such as the Pink Sheets or the OTC Bulletin Board.

In such event, it could become more difficult to dispose of, or obtain accurate price quotations for, our ADSs, and there would likely also be a reduction in our coverage by securities analysts and the news media, which could cause the price of our ADSs to decline further.

We have in the past been subject to notifications from Nasdaq indicating a failure to comply with the Minimum Bid Price Requirement because the bid price for our shares had closed below $1.00 for 30 consecutive business days.

In those instances we were able to regain compliance with the Minimum Bid Price Requirement by maintaining a closing bid price of $1.00 per share or greater for at least 10 consecutive business days, but we cannot assure investors that in the future we will be able to regain compliance with applicable Nasdaq requirements if we receive one or more additional such notifications or that we will otherwise be able to continue complying with Nasdaq requirements.

In the event that our ordinary shares are delisted from the Nasdaq Global Market and are not eligible for quotation or listing on another market or exchange, trading of our ordinary shares could be conducted only in the over-the-counter market or on an electronic bulletin board established for unlisted securities such as the Pink Sheets or the OTC Bulletin Board.

In such event, it could become more difficult to dispose of, or obtain accurate price quotations for, our ordinary shares, and there would likely also be a reduction in our coverage by securities analysts and the news media, which could cause the price of our ordinary shares to decline further.

Also, it may be difficult for us to raise additional capital if we are not listed on a major exchange.

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Accordingly, we would either have to obtain exemptive relief from the SEC or dispose of investments in order to fall outside the definition of an investment company, each of which may have a material adverse effect on the Company.

Finally, being deemed an investment company under the Investment Company Act could also make us unable to comply with our reporting obligations as a public company in the U.S., which would have a material adverse effect on the liquidity and value of our ADSs and ordinary shares, and may affect our ability to offer securities to investors in the U.S.

Finally, being deemed an investment company under the Investment Company Act could also make us unable to comply with our reporting obligations as a public company in the U.S., which would have a material adverse effect on the liquidity and value of our ordinary shares, and may affect our ability to offer securities to investors in the U.S.

market and our ability to continue to be listed on the Nasdaq Global Market.

An active, liquid trading market for our ADSs may not be maintained.

We can provide no assurance that we will be able to maintain an active trading market for our ADSs.

The lack of an active market may impair the ability of any investor to sell our ADSs at the time an investor may wish to sell them or at a price that an investor may consider reasonable.

An active, liquid trading market for our ordinary shares may not be maintained.

We can provide no assurance that we will be able to maintain an active trading market for our ordinary shares.

The lack of an active market may impair the ability of any investor to sell our ordinary shares at the time an investor may wish to sell them or at a price that an investor may consider reasonable.

An inactive market may also impair our ability to raise capital by selling shares and may impair our ability to acquire other businesses or technologies using our shares as consideration, which, in turn, could materially adversely affect our business.

Our executive officers, directors and principal shareholders, if they choose to act together, will have the ability to control or significantly influence all matters submitted to shareholders for approval.

Furthermore, some of our current directors were appointed by our principal shareholders.

As of December 31, 2024, our executive officers, directors and greater than 5% shareholders, in the aggregate, own approximately 80% of our outstanding ordinary shares (including 36,981,759 ordinary shares represented by ADSs and assuming no exercise of outstanding options).

As of December 31, 2025, our executive officers, directors and greater than 5% shareholders, in the aggregate, own approximately 82% of our outstanding ordinary shares.

Furthermore, some of our current directors were appointed by our principal shareholders.

As a result, such persons or their appointees to our Board, if they act together, will have the ability to control or significantly influence all matters submitted to our Board or shareholders for approval, including the appointment of our management, the election and removal of directors and approval of any significant transaction, as well as our management and business affairs.

This concentration of ownership may have the effect of delaying, deferring or preventing a change in

control, impeding a merger, consolidation, takeover or other business combination involving us, or discouraging a potential acquiror from making a tender offer or otherwise attempting to obtain control of our business, even if such a transaction would benefit other shareholders.

We do not currently intend to pay dividends on our securities, and, consequently, the ability to achieve a return on investment in our ADSs will depend on appreciation, if any, in the price of our ADSs.

This concentration of ownership may have the effect of delaying, deferring or preventing a change in control, impeding a merger, consolidation, takeover or other business combination involving us, or discouraging a potential acquiror from making a tender offer or otherwise attempting to obtain control of our business, even if such a transaction would benefit other shareholders.

We do not currently intend to pay dividends on our securities, and, consequently, the ability to achieve a return on investment in our ordinary shares will depend on appreciation, if any, in the price of our ordinary shares.

We have never declared or paid any cash dividend on our securities.

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Even if our Board decides to declare and pay dividends, the timing, amount and form of future dividends, if any, will depend on our future results of operations and cash flow, our capital requirements and surplus, the amount of distributions, if any, received by us from our subsidiaries, our financial condition, contractual restrictions and other factors deemed relevant by our Board.

Accordingly, the return on any investment in our ADSs will depend on any future price appreciation of our ADSs.

There is no guarantee that our ADSs will appreciate in value or even maintain the price at which our ADSs were or are purchased.

Some or all of any investment in our ADSs may be lost.

Sales of a substantial number of our ADSs or ordinary shares by our existing shareholders in the public market could cause the price of our ADSs to fall.

Sales of a substantial number of our ADSs or ordinary shares in the public market or the perception that these sales might occur could significantly reduce the market price of our ADSs and impair our ability to raise adequate capital.

As of December 31, 2024, we have a total of 36,981,759 ordinary shares represented by ADSs outstanding, assuming no exercise of outstanding options, which are freely tradable, without restriction, in the public market, unless they are held or purchased by one of our affiliates.

ADSs held by our affiliates are eligible for sale in the public market and will be subject to volume limitations under Rule 144 under the Securities Act.

As of December 31, 2024, the holders of approximately 18.4 million of our outstanding ordinary shares, or approximately 33.2% of our total outstanding ordinary shares, are entitled to rights with respect to the registration of their shares under the Securities Act.

Registration of these shares (including, in the case of affiliates, for resale) under the Securities Act would result in these shares becoming freely tradable without restriction under the Securities Act.

Any sales of securities by these shareholders could have a material adverse effect on the trading price of our ADSs.

We are an emerging growth company and smaller reporting company, and the reduced disclosure requirements applicable to emerging growth companies and smaller reporting companies may make our ADSs less attractive to investors.

Accordingly, the return on any investment in our ordinary shares will depend on any future price appreciation of our ordinary shares.

There is no guarantee that our ordinary shares will appreciate in value or even maintain the price at which our ordinary shares were or are purchased.

Some or all of any investment in our ordinary shares may be lost.

Sales of a substantial number of our ordinary shares by our existing shareholders in the public market could cause the price of our ordinary shares to fall.

Sales of a substantial number of our ordinary shares in the public market or the perception that these sales might occur could significantly reduce the market price of our ordinary shares and impair our ability to raise adequate capital.

We are an “emerging growth company” as defined in the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”).

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• not being required to disclose some executive compensation related items such as the correlation between executive compensation and performance and comparisons of the chief executive officer’s compensation to median employee compensation.

As a result, we do not know if some investors will find our ADSs less attractive.

The result may be a less active trading market for our ADSs, and the price of our ADSs may become more volatile.

As a result, we do not know if some investors will find our ordinary shares less attractive.

The result may be a less active trading market for our ordinary shares, and the price of our ordinary shares may become more volatile.

We will remain an emerging growth company until the earliest of:

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We may continue to be a smaller reporting company even after we are no longer an emerging growth company.

We may take advantage of certain of the scaled disclosures available to smaller reporting companies and will be able to take advantage of these scaled disclosures for so long as our voting and non-voting ordinary shares held by non-affiliates is less than $250 million measured on the last business day of our second fiscal quarter, or our annual revenue is less than $100 million during the most recently completed fiscal year and our voting and non-voting ordinary shares held by non-affiliates is less than $700 million measured on the last business day of our second fiscal quarter.

completed fiscal year and our voting and non-voting ordinary shares held by non-affiliates is less than $700 million measured on the last business day of our second fiscal quarter.

As a foreign private issuer, we are not subject to some U.S.

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• the sections of the Exchange Act regulating the solicitation of proxies, consents or authorizations in respect of a security registered under the Exchange Act;

• the sections of the Exchange Act requiring insiders to file public reports of their stock ownership and trading activities and liability for insiders who profit from trades made in a short period of time;

• the rules under the Exchange Act requiring the filing with the SEC of quarterly reports on Form 10-Q containing unaudited financial and other specified information, or current reports on Form 8-K, upon the occurrence of specified significant events.

Section 8103 of the National Defense Authorization Act for Fiscal Year 2026 (the “Holding Foreign Insiders Accountable Act”) was signed into law on December 18, 2025, and will require directors and officers of “foreign private issuers” to make insider reports under Section 16(a) of the Exchange Act, effective March 18, 2026.

Directors and officers of “foreign private issuers” will remain exempt from the short-swing profit disclosure and recovery provisions of Section 16 of the Exchange Act.

In addition, foreign private issuers are not required to file their annual report on Form 20-F until four months after the end of each fiscal year, while U.S.

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Foreign private issuers are also exempt from Regulation FD, which restricts the selective disclosure of material information.

Both foreign private issuers and emerging growth companies also are exempt from some more stringent executive compensation disclosure rules.

Thus, even if we no longer qualify as an emerging growth company, but remain a foreign private issuer, we will continue to be exempt from the more stringent compensation disclosures required of companies that are neither an emerging growth company nor a foreign private issuer.

In addition, as a foreign private issuer, our officers, directors and principal shareholders are exempt from reporting (i.e., will not file Forms 3, 4, or 5 when transacting in our securities) and are not subject to the “short-swing” profit recovery provisions of Section 16 of the Exchange Act and the rules thereunder.

Therefore, our shareholders may not have timely information and may not, for instance, know when our officers, directors and principal shareholders purchase or sell our ordinary shares or ADSs.

Foreign private issuers, smaller reporting companies and emerging growth companies also are exempt from some more stringent executive compensation disclosure rules.

Thus, even if we no longer qualify as an emerging growth company or a smaller reporting company, but remain a foreign private issuer, we will continue to be exempt from the more stringent compensation disclosures required of companies that are neither an emerging growth company nor a foreign private issuer.

In addition, as a foreign private issuer, our officers, directors and principal shareholders are exempt from the “short-swing” profit recovery provisions of Section 16 of the Exchange Act and the rules thereunder.

Therefore, our shareholders may not have timely information and may not, for instance, know when our officers, directors and principal shareholders purchase or sell our ordinary shares.

As a foreign private issuer, we are permitted to adopt some home country practices in relation to corporate governance matters that differ significantly from the Nasdaq corporate governance listing standards.

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Our holding company is incorporated under the laws of the Cayman Islands.

Our amended and restated memorandum and articles of association provides that a quorum required for the transaction of business at any general meeting of shareholders shall consist of one or more shareholders present in person or by proxy, holding shares which carry in aggregate not less than one-third of all votes attaching to all of our shares in issue and entitled to vote.

Additionally, our amended and restated memorandum and articles of association provides that any voting at any shareholders’ meeting shall be decided by a show of hands unless a poll is demanded (before or on the declaration of the result of the show of hands) by the chairperson of such meeting or by any one or more shareholders who together hold not less than 10% of the votes attaching to the total number of ordinary shares which are present in person or by proxy at the meeting.

Our amended and restated memorandum and articles of association provide that a quorum required for the transaction of business at any general meeting of shareholders shall consist of one or more shareholders present in person or by proxy, holding shares which carry in aggregate not less than one-third of all votes attaching to all of our shares in issue and entitled to vote.

Additionally, our amended and restated memorandum and articles of association provide that any voting at any shareholders’ meeting shall be decided by a show of hands unless a poll is demanded (before or on the declaration of the result of the show of hands) by the chairperson of such meeting or by any one or more shareholders who together hold not less than 10% of the votes attaching to the total number of ordinary shares which are present in person or by proxy at the meeting.

Although our minority quorum provisions satisfy the requirements applicable to Nasdaq-listed companies, some U.S.

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securities exchange.

Fluctuations in currency exchange rates may have a material adverse effect on our results of operations and the value of any investment in our ADSs.

Fluctuations in currency exchange rates may have a material adverse effect on our results of operations and the value of any investment in our ordinary shares.

The value of the Renminbi against the U.S.

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dollar, the Euro, the Japanese yen and the British pound.

In the fourth quarter of 2016, the Renminbi depreciated

significantly while the U.S.

In the fourth quarter of 2016, the Renminbi depreciated significantly while the U.S.

dollar surged and the PRC experienced persistent capital outflows.

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dollar in the future.

Significant revaluation of the Renminbi may have a material adverse effect on any investment in our ADSs.

Significant revaluation of the Renminbi may have a material adverse effect on any investment in our ordinary shares.

For example, to the extent that we need to convert U.S.

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Conversely, if we decide to convert our Renminbi into U.S.

dollars for the purpose of making payments for dividends on our ordinary shares or ADSs or for other business purposes, appreciation of the U.S.

dollars for the purpose of making payments for dividends on our ordinary shares or for other business purposes, appreciation of the U.S.

dollar against the Renminbi would have a negative effect on the U.S.

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In addition, our currency exchange losses may be magnified by PRC exchange regulations that restrict our ability to convert Renminbi into non-PRC currency.

Holders of our ADSs have fewer rights than our shareholders and must act through the depositary to exercise their rights.

Holders of our ADSs do not have the same rights as our registered shareholders.

As a holder of our ADSs, an investor will not have any direct right to attend general meetings of our shareholders or to cast any votes at such meetings.

As a holder of our ADSs, an investor will only be able to exercise the voting rights carried by the underlying ordinary shares which are represented by our ADSs indirectly by giving voting instructions to the depositary in accordance with the provisions of the deposit agreement.

Upon receipt of voting instructions from any investor, the depositary will try, as far as is practicable, to vote the ordinary shares underlying our ADSs in accordance with investor instructions.

If we ask for investor instructions, then upon receipt of investor voting instructions, the depositary will try to vote the underlying ordinary shares in accordance with these instructions.

If we do not instruct the depositary to ask for investor instructions, the depositary may still vote in accordance with instructions the investor gives, but it is not required to do so.

An investor will not be able to directly exercise any right to vote with respect to the underlying ordinary shares unless the investor withdraws the shares and becomes the registered holder of such shares prior to the record date for the general meeting.

When a general meeting is convened, an investor may not receive sufficient advance notice of the meeting to withdraw the shares underlying our ADSs and become the registered holder of such shares to allow the investor to attend the general meeting and to vote directly with respect to any specific matter or resolution to be considered and voted upon at the general meeting.

In addition, under our amended and restated memorandum and articles of association, for the purposes of determining those shareholders who are entitled to attend and vote at any general meeting, our directors may close our register of members and/or fix in advance a record date for such meeting, and such closure of our register of members or the setting of such a record date may prevent an investor from withdrawing the ordinary shares underlying our ADSs and becoming the registered holder of such shares prior to the record date, so that an investor would not be able to attend the general meeting or to vote directly.

If we ask for instructions from investors, the depositary will notify investors of the upcoming vote and will arrange to deliver our voting materials to investors.

We have agreed to give the depositary notice of shareholder meetings sufficiently in advance of such meetings.

Nevertheless, we cannot assure investors that investors will receive the voting materials in time to ensure that investors can instruct the depositary to vote the underlying ordinary shares represented by our ADSs.

In addition, the depositary and its agents are not responsible for failing to carry out voting instructions or for their manner of carrying out voting instructions.

This means that investors may not be able to exercise any right to direct how the shares underlying our ADSs are voted and investors may have no legal remedy if the shares underlying our ADSs are not voted as requested.

In addition, in an investor’s capacity as an ADS holder, the investor will not be able to call a shareholders’ meeting.

Except in limited circumstances, the depositary for our ADSs will give us a discretionary proxy to vote the ordinary shares underlying our ADSs if investors do not vote at shareholders’ meetings, which could adversely affect the interests of investors.

Under the deposit agreement for our ADSs, if investors do not vote, the depositary will deem that investors have instructed the depositary to give us a discretionary proxy to vote the ordinary shares underlying our ADSs at shareholders’ meetings unless:

• we have instructed the depositary that we do not wish a discretionary proxy to be given;

• we have informed the depositary that there is substantial opposition as to a matter to be voted on at the meeting;

• a matter to be voted on at the meeting would have a material adverse impact on shareholders;

• the voting at the meeting is to be conducted via a show of hands unless voting by poll is required by the applicable listing rules or our articles of association.

The effect of this discretionary proxy is that investors cannot prevent our ordinary shares underlying our ADSs from being voted, except under the circumstances described above.

This may make it more difficult for shareholders to influence our management.

Holders of our ordinary shares are not subject to this discretionary proxy.

Investors may not receive distributions on our ADSs or any value for them if such distribution is illegal or impractical or if any required government approval cannot be obtained in order to make such distribution available to any investor.

Although we do not have any present plan to pay any dividends, the depositary of our ADSs has agreed to pay to investors the cash dividends or other distributions it or the custodian receives on ordinary shares or other deposited securities underlying our ADSs, after deducting its fees and expenses and any applicable taxes and governmental charges.

Investors will receive these distributions in proportion to the number of ordinary shares our ADSs represent.

However, the depositary is not responsible if it decides that it is unlawful or impractical to make a distribution available to any holders of ADSs.

For example, it would be unlawful to make a distribution to a holder of ADSs if it consists of securities whose offering would require registration under the Securities Act but are not so properly registered or distributed under an applicable exemption from registration.

The depositary may also determine that it is not reasonably practicable to distribute some property.

In these cases, the depositary may determine not to distribute such property.

We have no obligation to register under the U.S.

securities laws any offering of ADSs, ordinary shares, rights or other securities received through such distributions.

We also have no obligation to take any other action to permit the distribution of ADSs, ordinary shares, rights or anything else to holders of ADSs.

This means that investors may not receive distributions we make on our ordinary shares or any value for them if it is illegal or impractical for us to make them available to investors.

These restrictions may cause a material decline in the value of our ADSs.

Investors’ right to participate in any future rights offerings may be limited, which may cause dilution to holdings in our ADSs.

Investors’ right to participate in any future rights offerings may be limited, which may cause dilution to holdings in our ordinary shares.

We may from time to time distribute rights to our shareholders, including rights to acquire our securities.

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unless we register the rights and the securities to which the rights relate under the Securities Act or an exemption from the registration requirements is available.

Also, under the deposit agreement, the depositary bank will not make rights available to investors unless either both the rights and any related securities are registered under the Securities Act, or the distribution of them to ADS holders is exempted from registration under the Securities Act.

We are under no obligation to file a registration statement with respect to any such rights or securities or to endeavor to cause such a registration statement to be declared effective.

Moreover, we may not be able to establish an exemption from registration under the Securities Act.

If the depositary does not distribute the rights, it may, under the deposit agreement, either sell them, if possible, or allow them to lapse.

Accordingly, investors may be unable to participate in our rights offerings and may experience dilution in holdings in our ADSs.

We may be classified as a passive foreign investment company, which could result in adverse U.S.

Accordingly, investors may be unable to participate in our rights offerings and may experience dilution in holdings in our ordinary shares.

We may be classified as a passive foreign investment company for U.S.

federal income tax purposes, which could result in adverse U.S.

federal income tax consequences to U.S.

Holders of our ADSs or ordinary shares.

We would be classified as a passive foreign investment company (“PFIC”) for any taxable year if, after the application of specific look-through rules, either:

holders of our ordinary shares.

We would be classified as a passive foreign investment company (“PFIC”) for U.S.

federal income tax purposes for any taxable year if, after the application of specific look-through rules, either:

(i) 75% or more of our gross income for such year is “passive income” (as defined in the relevant provisions of the U.S.

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federal income tax purposes for our taxable year ended December 31, 2025.

However, the application of the PFIC rules is subject to uncertainty in several respects, and we cannot assure investors that we will not be a PFIC for any taxable year.

However, PFIC determinations are highly factual and must be made annually after the close of each taxable year, and the application of the PFIC rules is subject to uncertainty in several respects.

Furthermore, our assessment of our PFIC status depends in large part on valuations of certain of our intangible assets performed by a third-party appraiser.

Such valuations are based on various assumptions which may vary from actual future results.

Moreover, the value of those intangible assets determined under such third-party valuations differ significantly from the value of such assets that may be implied by reference to the market price of our ordinary shares, and the U.S.

Internal Revenue Service may disagree with our determination of the value of our assets.

For the foregoing reasons, there can be no assurance that we were not a PFIC for our taxable year ended December 31, 2025 or that we will not be a PFIC our current taxable year or for any future taxable year.

federal income tax consequences could apply to a U.S.

Holder (as defined in “Taxation—U.S.

Income Taxation Considerations”) if we are treated as a PFIC for any taxable year during which such U.S.

Holder holds our ADSs or ordinary shares.

Investors may be subject to limitations on transfers of our ADSs.

Our ADSs are transferable on the books of the depositary.

However, the depositary may close its transfer books at any time or from time to time when it deems expedient in connection with the performance of its duties.

In addition, the depositary may refuse to deliver, transfer or register transfers of ADSs generally when our books or the books of the depositary are closed, or at any time if we or the depositary deems it advisable to do so because of any requirement of law or of any government or governmental body, or under any provision of the deposit agreement, or for any other reason.

Investors’ rights to pursue claims against the depositary as a holder of ADSs are limited by the terms of the deposit agreement.

Under the deposit agreement, any action or proceeding against or involving the depositary, arising out of or based upon the deposit agreement or the transactions contemplated thereby or by virtue of owning our ADSs may only be instituted in a state or federal court in New York, New York, and any investor, as a holder of our ADSs, will have irrevocably waived any objection which the investor may have to the laying of venue of any such proceeding, and irrevocably submitted to the exclusive jurisdiction of such courts in any such action or proceeding.

The depositary may, in its sole discretion, require that any dispute or difference arising from the relationship created by the deposit agreement be referred to and finally settled by an arbitration conducted under the terms described in the deposit agreement.

These arbitration provisions govern such dispute or difference and do not, in any event, preclude investors from pursuing claims under the Securities Act or the Exchange Act in state or federal courts.

ADS holders may not be entitled to a jury trial with respect to claims arising under the deposit agreement, which could result in less favorable outcomes to the plaintiff(s) in any such action.

The deposit agreement governing our ADSs representing our ordinary shares provides that, subject to the depositary’s right to require a claim to be submitted to arbitration, the federal or state courts in the City of New York have exclusive jurisdiction to hear and determine claims arising under the deposit agreement and in that regard, to the fullest extent permitted by law, ADS holders, including purchasers of ADSs in secondary transactions, waive the right to a jury trial of any claim they may have against us or the depositary arising out of or relating to our ordinary shares, our ADSs or the deposit agreement, including any claim under the U.S.

federal securities laws.

If we or the depositary opposed a jury trial demand based on the waiver, the court would determine whether the waiver was enforceable based on the facts and circumstances of that case in accordance with the applicable state and federal law.

To our knowledge, the enforceability of a contractual pre-dispute jury trial waiver in connection with claims arising under the federal securities laws has not been finally adjudicated by the U.S.

Supreme Court.

In determining whether to enforce a contractual pre-dispute jury trial waiver provision, courts will generally consider whether a party knowingly, intelligently and voluntarily waived the right to a jury trial.

We believe that a contractual pre-dispute jury trial waiver provision is generally enforceable, including under the laws of the State of New York, which govern the deposit agreement.

We believe that this is the case with respect to the deposit agreement and our ADSs.

It is advisable that investors consult legal counsel regarding the jury waiver provision before investing in our ADSs.

If an investor or any other holders or beneficial owners of ADSs bring a claim against us or the depositary in connection with matters arising under the deposit agreement or our ADSs, including claims under federal securities laws, an investor or such other holder or beneficial owner may not be entitled to a jury trial with respect to such claims, which may have the effect of limiting and discouraging lawsuits against us and/or the depositary.

If a lawsuit is brought against us and/or the depositary under the deposit agreement, it may be heard only by a judge or justice of the applicable trial court, which would be conducted according to different civil procedures and may result in different outcomes than a trial by jury would have had, including results that could be less favorable to the plaintiff(s) in any such action.

Nevertheless, if this jury trial waiver provision is not enforced, to the extent a court action proceeds, it would proceed under the terms of the deposit agreement with a jury trial.

No condition, stipulation or provision of the deposit agreement or ADSs serves as a waiver by any holder or beneficial owner of ADSs or by us or the depositary of compliance with any substantive provision of the U.S.

federal securities laws and the rules and regulations promulgated thereunder.

Investors may face difficulties in protecting the interests of investors, and the ability to protect the rights of investors through U.S.

holder if we are treated as a PFIC for any taxable year during which such U.S.

holder holds our ordinary shares.

Investors may face difficulties in protecting their interests, and the ability to protect the rights of investors through U.S.

courts may be limited, because we are incorporated under Cayman Islands law.

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Under Cayman Islands law, the names of our current directors can be obtained from a search conducted at the Registrar of Companies.

Our directors have discretion under our amended and restated articles of association, to determine whether or not, and under what conditions, our corporate records may be inspected by our shareholders, but are not obliged to make them available to our shareholders.

Our directors have discretion under our amended and restated articles of association, to

determine whether or not, and under what conditions, our corporate records may be inspected by our shareholders, but are not obliged to make them available to our shareholders.

This may make it more difficult for investors to obtain the information needed to establish any facts necessary for a shareholder motion or to solicit proxies from other shareholders in connection with a proxy contest.

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We may experience material weaknesses in our internal control over financial reporting in the future.

If so, or if we otherwise fail to maintain proper and effective internal control over financial reporting, our ability to produce accurate and timely consolidated financial statements could be impaired, investors may lose confidence in our financial reporting and the trading price of our ADSs may decline.

Pursuant to Section 404 of Sarbanes-Oxley, our management has been required to report upon the effectiveness of our internal control over financial reporting beginning annually with the fiscal year ended December 31, 2022.

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To comply with the requirements of being a reporting company under the Exchange Act, we have and will need to continuously upgrade our information technology systems, implement additional financial and management controls, reporting systems and procedures and hire additional accounting and finance staff.

If we or, if required, our auditor is unable to conclude that our internal control over financial reporting is effective, investors may lose confidence in our financial reporting and the trading price of our ADSs may decline.

We cannot assure investors that there will not be material weaknesses or any significant deficiencies in our internal control over financial reporting in the future.

Any failure to maintain effective internal control over financial reporting could severely inhibit our ability to accurately report our financial condition, results of operations or cash flows.

If we are unable to conclude that our internal control over financial reporting is effective, or if our independent registered public accounting firm determines we have a material weakness or significant deficiency in our internal control over financial reporting once that firm begin its Section 404 reviews, investors may lose confidence in the accuracy and completeness of our financial reports, the market price of our ADSs could decline, and we could be subject to sanctions or investigations by Nasdaq, the SEC or other regulatory authorities.

If we are unable to conclude that our internal control over financial reporting is effective, or if our independent registered public accounting firm determines we have a material weakness or significant deficiency in our internal control over financial reporting once that firm begin its Section 404 reviews, investors may lose confidence in the accuracy and completeness of our financial reports, the market price of our ordinary shares could decline, and we could be subject to sanctions or investigations by Nasdaq, the SEC or other regulatory authorities.

Failure to remedy any material weakness in our internal control over financial reporting, or to implement or maintain other effective control systems required of public companies, could also restrict our future access to the capital markets.

Our amended and restated memorandum and articles of association contain anti-takeover provisions that could discourage a third party from acquiring us, which could limit our shareholders’ opportunity to sell their shares, including ordinary shares represented by our ADSs, at a premium.

Our amended and restated memorandum and articles of association contain provisions to limit the ability of others to acquire control of us or cause us to engage in change-of-control transactions.

These provisions could have the effect of depriving our shareholders of an opportunity to sell their shares at a premium over prevailing market prices by discouraging third parties from seeking to obtain control of us in a tender offer or similar transaction.

For example, our Board has the authority, without further action by our shareholders, to issue preferred shares in one or more series and to fix their designations, powers, preferences, privileges, and relative participating, optional or special rights and the qualifications, limitations or restrictions, including dividend rights, conversion rights, voting rights, terms of redemption and liquidation preferences, any or all of which may be greater than the rights associated with our ordinary shares, in the form of ADS or otherwise.

Preferred shares could be issued quickly with terms calculated to delay or prevent a change in control of us or make removal of management more difficult.

If our Board decides to issue preferred shares, the price of our ADSs may fall and the voting and other rights of the holders of our ordinary shares and ADSs may be materially and adversely affected.

We could be subject to securities class action litigation.

If our Board decides to issue preferred shares, the price of our ordinary shares may fall and the voting and other rights of the holders of our ordinary shares may be materially and adversely affected.

We could be subject to securities class action litigation or shareholder activism.

In the past, securities class action litigation has often been brought against a company following a decline in the market price of its securities.

The same volatility in the market price of such securities could cause a company to be the target of shareholder activism.

This risk is especially relevant for us because biotechnology and pharmaceutical companies have experienced significant share price volatility in recent years.

If we face such litigation, it could result in substantial costs and a diversion of management’s attention and resources, which could harm our business.

If securities or industry analysts do not continue to publish research or publish inaccurate or unfavorable research about our business, the market price for our ADSs and trading volume could decline.

The trading market for our ADSs relies in part on the research and reports that equity research analysts publish about us or our business.

If we face such litigation or shareholder activism, it could result in substantial costs and a diversion of management’s attention and resources, which could harm our business.

If securities or industry analysts do not continue to publish research or publish inaccurate or unfavorable research about our business, the market price for our ordinary shares and trading volume could decline.

The trading market for our ordinary shares relies in part on the research and reports that equity research analysts publish about us or our business.

We do not control these analysts.

If research analysts do not maintain adequate research coverage or if one or more of the analysts who covers us downgrades our ADSs or publishes inaccurate or unfavorable research about our business, the market price for our ADSs would likely decline.

If one or more of these analysts cease coverage of us or fail to publish reports on us regularly, we could lose visibility in the financial markets, which, in turn, could cause the market price or trading volume for our ADSs to decline significantly.

If research analysts do not maintain adequate research coverage or if one or more of the analysts who covers us downgrades our ordinary shares or publishes inaccurate or unfavorable research about our business, the market price for our ordinary shares would likely decline.

The increasing use of social media platforms presents new risks and challenges.

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Although we do not have a VIE structure, due to our operations in the PRC, any future PRC, U.S.

or other rules and regulations that place restrictions on capital raising or other activities or require enhanced disclosure by PRC-based companies could adversely affect our business and results of operations.

If the business environment in the PRC deteriorates from the perspective of PRC or international investment, the PRC government may intervene with our operations and our business in the PRC and the U.S., and the market price of our ADSs could be adversely affected.

The PRC government may intervene in or influence our operations in accordance with laws and regulations, which could result in a material change in our operations and significantly and adversely impact the value of our ADSs.

The PRC government has significant oversight over the conduct of our business within the PRC and may intervene or influence our operations as the government deems appropriate to further regulatory, political and societal goals in accordance with laws and regulations.

or other rules and regulations that place restrictions on capital raising or other activities or require enhanced disclosure by PRC-based companies could adversely affect our business and results of

The PRC government has significant oversight over the conduct of our business within the PRC and may issue regulatory directives or provide supervisory guidance impacting our operations as the government deems appropriate to further regulatory, political and societal goals in accordance with laws and regulations.

In recent years, the PRC government published new policies that significantly affected some industries such as the education and internet industries, and we cannot rule out the possibility that it will in the future release regulations or policies regarding our industry or us that could require us to seek permission from PRC governmental authorities to continue to operate our business, which may adversely affect our business, financial condition and results of operations.

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The Data Security Law provides that the data processing activities must be conducted based on “data classification and hierarchical protection system” for the purpose of data protection and prohibits entities in the PRC from transferring data stored in the PRC to foreign law enforcement agencies or judicial authorities without prior approval by the authorized PRC governmental authority.

Additionally, the PRC’s Cyber Security Law requires companies to take some organizational, technical and administrative measures and other necessary measures to ensure the security of their networks and data stored on their

Specifically, the Cyber Security Law provides that the PRC adopt a multi-level protection scheme (“MLPS”) under which network operators are required to perform obligations of security protection to ensure that the network is free from interference, disruption or unauthorized access, and prevent network data from being disclosed, stolen or tampered.

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and (ii) internet platform operators holding personal information of more than one million users and seeking to have their securities list on a stock exchange in a foreign country shall file for cybersecurity review with the Cybersecurity Review Office.

The 2022 Cybersecurity Review Measures remain unclear on whether the relevant requirements will be applicable to the follow-on offerings of companies that have completed initial public offerings on stock exchanges outside the PRC.

The 2022 Cybersecurity Review Measures remain unclear on whether the relevant

requirements will be applicable to the follow-on offerings of companies that have completed initial public offerings on stock exchanges outside the PRC.

As of the date of this Annual Report on Form 10-K, we have not been informed by any PRC government agency that we qualify as a CIIO or internet platform operator, and we are not a data processor in possession of more than one million users’ personal information.

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If personal information of more than 100,000 individuals but less than 1,000,000 individuals in aggregate (excluding sensitive personal information) or sensitive personal information of less than 10,000 individuals in aggregate has been provided overseas by any data processor other than an operator of critical information infrastructure since January 1 of the current year, standard contracts for personal information transfer shall be entered into with the overseas receivers or the certification of personal information protection shall be passed in accordance with the law.

Despite the above, where a data processor transfers data abroad, it may be exempted from applying for a cross-border transfer security assessment,

concluding a standard contract for personal information to be provided abroad or passing a security certificate for personal information protection if it satisfies any of the following conditions:

Despite the above, where a data processor transfers data abroad, it may be exempted from applying for a cross-border transfer security assessment, concluding a standard contract for personal information to be provided abroad or passing a security certificate for personal information protection if it satisfies any of the following conditions:

(1) where it is really necessary to provide personal information abroad for the purpose of concluding or performing a contract to which an individual concerned is a party, such as cross-border shopping, cross-border delivery, cross-border remittance, cross-border payment, cross-border account opening, air ticket and hotel reservation, visa handling and examination services;

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Also, the Standing Committee of the National People’s Congress released the Personal Information Protection Law, which became effective on November 1, 2021.

The Personal Information Protection Law provides a comprehensive set of data privacy and protection requirements that apply to the processing of personal information and expands data protection compliance obligations to cover the processing of personal information of persons by organizations and individuals in the PRC, and the processing of personal information of persons in the PRC outside of the PRC if such processing is for purposes of providing products and services to, or analyzing and evaluating the behavior of, persons in the PRC.

The Personal Information Protection Law provides a comprehensive set of data privacy and protection requirements that apply to the processing of personal information and expands data protection

compliance obligations to cover the processing of personal information of persons by organizations and individuals in the PRC, and the processing of personal information of persons in the PRC outside of the PRC if such processing is for purposes of providing products and services to, or analyzing and evaluating the behavior of, persons in the PRC.

The Personal Information Protection Law also provides that critical information infrastructure operators and personal information processing entities who process personal information meeting a volume threshold to be set by PRC cyberspace regulators are also required to store in the PRC personal information generated or collected in the PRC, and to pass a security assessment administered by PRC cyberspace regulators for any export of such personal information.

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Any failure on our part to comply, or any compromise of security that results in unauthorized access, use or release of personal information or other data, or the perception or allegation that any failure or compromise has occurred, could damage our reputation, discourage new and existing partners, vendors or other parties from contracting with us or result in investigations, fines, suspension or other penalties by governmental authorities and private claims or litigation, any of which could materially adversely affect our business, financial condition and results of operations.

Even if our operations are not subject to legal challenge, the perception of privacy concerns, whether or not valid, may harm our reputation and adversely affect our business, financial condition and results of operations.

our operations are not subject to legal challenge, the perception of privacy concerns, whether or not valid, may harm our reputation and adversely affect our business, financial condition and results of operations.

Moreover, the legal uncertainty created by such laws, rules and regulations and the recent PRC government actions could materially adversely affect our ability to raise capital, or to do so on favorable terms, including engaging in public or private equity or debt financings in the U.S.

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stock exchange or for our operations, or obtain the waiver of such permission or approval, in a timely manner, or at all, or wrongly conclude that such permissions or approvals are not required, or if applicable laws, regulations, or interpretations change and obligate us to obtain such permission or approvals in the future, we may be subject to fines and penalties, suspension or limitations on our business activities in the PRC, revocation of our business licenses, website closure, delay or restrictions on the contribution of proceeds from any offering into the PRC, or other sanctions that could have a material adverse effect on our business, financial condition, results of operations, reputation and prospects.

PRC laws and regulations governing our current business operations are sometimes vague and uncertain, and therefore, these risks may result in a material negative change in our subsidiaries’ operations, significant depreciation of the value of our ADSs, or a hindrance of our ability to offer or continue to offer our securities to investors, which could cause the value of the securities of investors to decrease.

PRC laws and regulations governing our current business operations are sometimes vague and uncertain, and therefore, these risks may result in a material negative change in our subsidiaries’ operations, significant depreciation of the value of our ordinary shares, or a hindrance of our ability to offer or continue to offer our securities to investors, which could cause the value of the securities of investors to decrease.

Our operations in the PRC are governed by PRC laws, rules and regulations.

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Although we do not have a VIE structure, due to our operations in the PRC, any future PRC, U.S.

Recently enacted laws, rules and regulations may not sufficiently cover all aspects of economic activities in the PRC or may be subject to significant degrees of interpretation by PRC regulatory agencies.

In particular, because these laws, rules and regulations are relatively new, and because of the limited number of published decisions and the non-binding

nature of such decisions, and because the laws, rules and regulations often give the relevant regulator a certain degree of discretion in how to enforce them, the interpretation and enforcement of these laws, rules and regulations involve uncertainties and can be inconsistent and unpredictable.

In particular, because these laws, rules and regulations are relatively new, and because of the limited number of published decisions and the non-binding nature of such decisions, and because the laws, rules and regulations often give the relevant regulator a certain degree of discretion in how to enforce them, the interpretation and enforcement of these laws, rules and regulations involve uncertainties and can be inconsistent and unpredictable.

In addition, the PRC legal system is based in part on government policies and internal rules, some of which are not published on a timely basis or at all, and which may have a retroactive effect.

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In the past few years, PRC regulators have announced regulatory actions aimed at providing the PRC government with greater oversight over sectors of the economy in the PRC, including the for-profit education sector and technology platforms that have a quantitatively significant number of users located in the PRC.

Although the biotechnology industry is already highly regulated in the PRC and while there has been no indication to date that such actions or oversight would apply to companies like us, the PRC government may in the future take regulatory actions that materially affect the business environment and financial markets in the PRC as they relate to us, our ability to operate our business, our liquidity and our access to capital.

The approval of and the filing with the CSRC may be required under a PRC regulation in connection with any future offerings of our securities in the U.S.

Although the biotechnology industry is

already highly regulated in the PRC and while there has been no indication to date that such actions or oversight would apply to companies like us, the PRC government may in the future take regulatory actions that materially affect the business environment and financial markets in the PRC as they relate to us, our ability to operate our business, our liquidity and our access to capital.

The approval of and the filing with the CSRC has been, and may in the future, be required under a PRC regulation in connection with any future offerings of our securities in the U.S.

The PRC government has indicated an intent to take actions to exert more oversight and control over offerings that are conducted outside the PRC and/or foreign investment in China-based issuers.

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(i) if the issuer issues securities (excluding the securities issued for the purpose of implementing equity incentive, distribution of stock dividends, share split, etc.) in the same stock exchange outside the PRC, or such issuer issues convertible bonds, exchangeable bonds or preferred shares after its issuance and listing outside the PRC, it shall make a filing with the CSRC within three (3) business days upon the completion of such issuance;

(ii) if the issuer seeks for the secondary listing or primary listing in any other stock exchange outside the PRC after its issuance and listing outside the PRC, it shall make a filing with the CSRC within three (3) business days after submitting the application

documents for issuance and listing outside the PRC;

(iii) if the issuer issues the securities in installments within the scope of authorization after its issuance and listing outside the PRC, it shall make a filing with the CSRC within three (3) business days after the completion of its first issuance and state the total amount of the securities to be issued.

3 unchanged sentences

Since the New Filing Rules are relatively new, as of the date of this Annual Report on Form 10-K, substantial uncertainties exist with respect to the interpretations and implementations of the New Filing Rules.

Based on a set of Q&A published on the CSRC’s official website in connection with the release of the New Filing Rules, a CSRC official indicated that the PRC domestic companies that have completed a public offering and listing outside the PRC prior to the enactment of the New Filing Rules shall be regarded as existing issuers (“Existing Issuers”).

of the New Filing Rules shall be regarded as existing issuers (“Existing Issuers”).

Existing Issuers are not required to file with CSRC immediately, but will be required to file with CSRC as required in the future for any future offering or listing of securities (which, for the purposes of the New Filing Rules, are defined thereunder as equity shares, depository receipts, corporate bonds convertible to equity shares, and other equity securities that are offered and listed outside the PRC, either directly or indirectly, by PRC domestic companies) in markets outside the PRC, either via direct or indirect means, within three working days upon completion of issuance of such securities.

As an Existing Issuer, we will be subject to the requirements imposed by the New Filing Rules in connection with future securities offerings, including future sales of our ADSs under our “at the market” offering program.

As an Existing Issuer, we will be subject to the requirements imposed by the New Filing Rules in connection with future securities offerings, including future sales of our ordinary shares under our “at the market” offering program.

For example, in connection with a March 2026 private placement of our ordinary shares, we are required to submit a CSRC filing pursuant to the New Filing Rules.

We cannot assure investors that we will be able to complete such filing or comply with any other requirements that will be imposed on us under the New Filing Rules, on a timely basis or at all.

Failure to comply with the filing requirements or any other requirements under the New Filing Rules could result in orders of rectification, warnings, fines to the relevant PRC domestic companies ranging from RMB 1 million to RMB 10 million and fines on the controlling shareholder and other responsible persons, restrictions on our operations, having to delist from a stock exchange, the halting of securities offerings to foreign investors and other actions that could materially and adversely affect our operations and the interests of our investors and cause a significant depreciation in the price of our ordinary shares and ADSs.

Additionally, the requirements imposed by the New Filing Rules may delay or deter future offerings of our securities and impair our ability to obtain financing on acceptable terms or at all.

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The fruition of such risks could significantly limit or completely hinder our access to the U.S.

capital markets and could cause the value of our securities, particularly our ADSs, to significantly decline or become worthless.

capital markets and could cause the value of our securities to significantly decline or become worthless.

If we fail to receive any requisite permission or approval from or complete the filing with the CSRC or other PRC regulatory authorities for any offering or listing of our securities, or obtain the waiver of such permission or approval, in a timely manner, or at all, we may be subject to fines and penalties, suspension or limitations on our business activities in China, revocation of our business licenses, website closure, delay or restrictions on the contribution of proceeds from any offering into the PRC, or other sanctions that could have a material adverse effect on our business, financial condition, results of operations, reputation and prospects.

3 unchanged sentences

It is uncertain whether we will be required to obtain permission from the PRC government to maintain our listing on any U.S.

exchange (including retroactively), and even if such permission is sought, whether it will be denied or rescinded.

exchange (including retroactively), and even if such permission is

sought, whether it will be denied or rescinded.

Any future actions by the CSRC or other PRC regulatory authorities to exert more oversight and control over offerings conducted outside the PRC and foreign investment in PRC-based issuers could significantly limit or completely hinder our ability to offer securities to investors and cause the value of our securities to significantly decline or become worthless.

11 unchanged sentences

Complying with the requirements of the new regulations to complete such transactions could be time-consuming, and any required approval processes, including approval from the MOFCOM, may delay or inhibit our ability to complete such transactions, which could affect our ability to expand our business or maintain our market share.

PRC governmental authorities take a contrary position, nor can we predict whether or how long it will take to obtain such approval or pass such review.

In addition, as PRC governmental authorities have a certain degree of discretion in interpreting and implementing statutory provisions, we cannot assure the investors that we are not required to obtain such approval or pass such review under PRC laws, regulations or policies if the relevant PRC governmental authorities take a contrary position, nor can we predict whether or how long it will take to obtain such approval or pass such review.

Any failure to obtain or delay in obtaining the requisite governmental approval or review would subject us to sanctions imposed by the relevant PRC regulatory authority, including orders to stop the illegal act, confiscation of illegal income and a fine ranging from 1% to 10% of the sale amount of the preceding year or not more than 500,000 RMB (the specific amount of fines shall be determined in consideration of the nature of the illegal act, the extent and the period of time during which the act was continuing etc.).

4 unchanged sentences

There can be no assurance that the relevant PRC government agencies, including the CSRC, would reach the same conclusion as us.

If the CSRC or any other PRC regulatory body determines that we need to obtain the CSRC’s approval for follow-on offerings or if the CSRC or any other PRC government authorities promulgates any interpretation or implements rules that would require us to obtain CSRC or other governmental approvals for follow-on offerings, we may be unable to obtain such approvals on a timely basis or at all and we may face adverse actions or sanctions by the CSRC or other PRC regulatory agencies if we proceed with an offering of our securities without first receiving any required approvals.

If the CSRC or any

other PRC regulatory body determines that we need to obtain the CSRC’s approval for follow-on offerings or if the CSRC or any other PRC government authorities promulgates any interpretation or implements rules that would require us to obtain CSRC or other governmental approvals for follow-on offerings, we may be unable to obtain such approvals on a timely basis or at all and we may face adverse actions or sanctions by the CSRC or other PRC regulatory agencies if we proceed with an offering of our securities without first receiving any required approvals.

In any such event, these regulatory agencies may impose fines and penalties on our operations in the PRC, limit our operating privileges in the PRC, delay or restrict the repatriation of the proceeds from future offerings into the PRC or take other actions that could have a material adverse effect on our business, financial condition, results of operations, reputation and prospects.

Governmental control of currency conversion may limit our ability to remit funds out of the PRC and utilize our capital or future revenues effectively and could affect the value of any investment in our ADSs.

As a holding company, we are dependent upon cash dividends, distributions and other transfers from our subsidiaries to make dividend payments.

As of December 31, 2024, there have not been any such dividends or other distributions from our subsidiaries.

In addition, none of our subsidiaries have ever issued any dividends or distributions to us or to U.S.

The majority of our income under the Simcere Agreement is expected to be received in Renminbi, and shortages in foreign currencies may restrict our ability to pay dividends or other payments, or otherwise satisfy our foreign currency denominated obligations, if any.

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The PRC government may at its discretion further restrict access in the future to non-PRC currencies for current account transactions.

If the foreign exchange control system prevents us from obtaining sufficient non-PRC currencies to satisfy our non-PRC currency demands, we may not be able to pay dividends in non-PRC currencies to our shareholders, including holders of our ADSs.

PRC regulation of loans to, and direct investments in, PRC entities by offshore holding companies may restrict or prevent us from making loans or additional capital contributions to our PRC subsidiaries.

3 unchanged sentences

According to Circular 28 in 2023, the capital funds and foreign exchange receipts under the account of foreign debts of a non-financial enterprise and RMB funds obtained from foreign exchange settlement thereof shall be used under the principles of veracity and self-use, and shall not be used for expenditures prohibited by laws.

Unless otherwise prescribed, they shall not be used for investment in securities or other wealth management investment, except for wealth management products with risk ratings of not higher than Grade II and structured deposits, and for granting loans to non-affiliated enterprises, except explicitly permitted in the business scope or in special regions.

Unless otherwise prescribed, they shall not be used for investment in securities or other wealth management investment, except for wealth management products with risk ratings of not higher

than Grade II and structured deposits, and for granting loans to non-affiliated enterprises, except explicitly permitted in the business scope or in special regions.

Circular 28 in 2023 may significantly limit our ability to transfer any non-PRC currency we hold, to our PRC subsidiaries, which may adversely affect our liquidity and our ability to fund and expand our business in the PRC.

16 unchanged sentences

Our PRC subsidiaries have obligations to file documents related to employee share options or restricted shares with relevant tax authorities and to withhold individual income taxes for those employees who exercise their share options.

If our employees fail to pay or we fail to withhold their income taxes according to relevant laws and

regulations, we may face sanctions imposed by the tax authorities or other PRC government authorities.

If our employees fail to pay or we fail to withhold their income taxes according to relevant laws and regulations, we may face sanctions imposed by the tax authorities or other PRC government authorities.

“Executive Compensation.”

2 unchanged sentences

Circular 37 requires PRC residents (including PRC individuals and PRC corporate entities as well as non-PRC individuals that are deemed as PRC residents for foreign exchange administration purposes) to register with SAFE or its local branches in connection with their direct or indirect offshore investment activities.

Circular 37 further requires amendment to the SAFE registrations in the event of any changes with respect to the basic information of the offshore special purpose vehicle, such as change of a PRC individual shareholder, name and operation term, or any significant changes with respect to the offshore special purpose vehicle, such as increase or decrease of capital contribution, share transfer or exchange, or mergers or divisions.

transfer or exchange, or mergers or divisions.

Circular 37 is applicable to our shareholders or beneficial owners who are PRC residents and may be applicable to any offshore acquisitions that we make in the future.

15 unchanged sentences

In such case, our cash flow may be materially reduced as a result of our global income being taxed under the Enterprise Income Tax Law.

We believe that none of our entities outside of the PRC is a PRC

resident enterprise for PRC tax purposes.

We believe that none of our entities outside of the PRC is a PRC resident enterprise for PRC tax purposes.

However, the tax resident status of an enterprise is subject to determination by the PRC tax authorities and uncertainties remain with respect to the interpretation of the term “de facto management body.”

Dividends paid to our non-PRC investors (should we ever pay dividends) and gains on the sale of our ADSs by our non-PRC investors may become subject to PRC tax.

Dividends paid to our non-PRC investors (should we ever pay dividends) and gains on the sale of our ordinary shares by our non-PRC investors may become subject to PRC tax.

Under the Enterprise Income Tax Law and its implementation regulations issued by the State Council, a 10% PRC withholding tax is applicable to dividends paid to investors that are non-resident enterprises, which do not have an establishment or place of business in the PRC or which have such establishment or place of business but the dividends are not effectively connected with such establishment or place of business, to the extent such dividends are derived from sources within the PRC.

Any gain realized on the transfer of ADSs or ordinary shares by such investors is also subject to PRC tax at a current rate of 10%, if such gain is regarded as income derived from sources within the PRC.

If we are deemed a PRC resident enterprise, dividends paid on our ordinary shares or ADSs, and any gain realized from the transfer of our ordinary shares or ADSs, would be treated as income derived from sources within the PRC and would as a result be subject to PRC taxation.

Furthermore, if we are deemed a PRC resident enterprise, dividends paid to individual investors who are non-PRC residents and any gain realized on the transfer of ADSs or ordinary shares by such investors may be subject to PRC tax (which in the case of dividends may be withheld at source) at a rate of 20%.

Any gain realized on the transfer of ordinary shares by such investors is also subject to PRC tax at a current rate of 10%, if such gain is regarded as income derived from sources within the PRC.

If we are deemed a PRC resident enterprise, dividends paid on our ordinary shares, and any gain realized from the transfer of our ordinary shares, would be treated as income derived from sources within the PRC and would as a result be subject to PRC taxation.

Furthermore, if we are deemed a PRC resident enterprise, dividends paid to individual investors who are non-PRC residents and any gain realized on the transfer of ordinary shares by such investors may be subject to PRC tax (which in the

case of dividends may be withheld at source) at a rate of 20%.

Any PRC tax liability may be reduced by an applicable tax treaty.

However, if we or any of our subsidiaries established outside the PRC are considered a PRC resident enterprise, it is unclear whether holders of our ADSs would be able to claim the benefit of income tax treaties or agreements entered into between the PRC and other countries or areas.

If dividends paid to our non-PRC investors, or gains from the transfer of our ADSs by such investors, are deemed as income derived from sources within the PRC and thus are subject to PRC tax, the value of our ADSs may decline significantly.

However, if we or any of our subsidiaries established outside the PRC are considered a PRC resident enterprise, it is unclear whether holders of our ordinary shares would be able to claim the benefit of income tax treaties or agreements entered into between the PRC and other countries or areas.

If dividends paid to our non-PRC investors, or gains from the transfer of our ordinary shares by such investors, are deemed as income derived from sources within the PRC and thus are subject to PRC tax, the value of our ordinary shares may decline significantly.

We and our shareholders face uncertainties with respect to indirect transfers of equity interests in PRC resident enterprises or other assets attributed to a PRC establishment of a non-PRC company, or immovable properties located in the PRC owned by non-PRC companies.

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We face uncertainties as to the reporting and other implications of past and future transactions where PRC or other taxable assets are involved, such as offshore restructuring, sale of the shares in our offshore subsidiaries or investments.

We may be subject to filing obligations, required to obtain independent valuations, or taxed if we are the transferor in such

transactions, and may be subject to withholding obligations if we are the transferee in such transactions under Bulletin 7 and SAT Circular 37.

We may be subject to filing obligations, required to obtain independent valuations, or taxed if we are the transferor in such transactions, and may be subject to withholding obligations if we are the transferee in such transactions under Bulletin 7 and SAT Circular 37.

If there are transfers of our securities by investors that are non-PRC resident enterprises, our PRC subsidiaries may be requested to assist in the filing under Bulletin 7 and SAT Circular 37.

24 unchanged sentences

Recent litigation, regulatory scrutiny and negative publicity surrounding PRC-based companies listed in the U.S.

may result in increased regulatory scrutiny of us and negatively impact the trading price of our ADSs.

may result in increased regulatory scrutiny of us and negatively impact the trading price of our ordinary shares.

We believe that litigation, regulatory scrutiny and negative publicity surrounding PRC-based companies that are listed in the U.S.

2 unchanged sentences

Some of these companies have become subject to shareholder litigation or are conducting internal or external investigations into allegations of, among other things, accounting irregularities and mistakes, a lack of effective internal controls over financial accounting and inadequate corporate governance policies.

Any similar scrutiny of us, regardless of its lack of merit, could result in a diversion of management resources and energy, potential costs to defend ourselves against rumors or litigation, decreases and volatility in our ADS trading price, and increased directors and officers insurance premiums, and could have a material adverse effect upon our business, results of operations and financial condition.

Any similar scrutiny of us, regardless of its lack of merit, could result in a diversion of management resources and energy, potential costs to defend ourselves against rumors or litigation, decreases and volatility in our ordinary share trading price, and increased directors and officers insurance premiums, and could have a material adverse effect upon our business, results of operations and financial condition.

The enforcement of the PRC Labor Law, Labor Contract Law, and other labor-related regulations in the PRC may increase our labor costs and limit our flexibility to use labor.

1 unchanged sentence

According to the PRC Labor Contract Law, an employer is obliged to sign an unfixed-term labor contract with any employee who has worked for the employer for 10 consecutive years.

Further, if an employee requests or agrees to renew a

fixed-term labor contract that has already been entered into twice consecutively, the resulting contract must have an unfixed term, with some exceptions.

Further, if an employee requests or agrees to renew a fixed-term labor contract that has already been entered into twice consecutively, the resulting contract must have an unfixed term, with some exceptions.

The employer must pay economic compensation to an employee where a labor contract is terminated or not renewed upon expiration in accordance with the PRC Labor Contract Law, except for some situations which are specifically regulated.

5 unchanged sentences

If we are subject to severe penalties or incur significant liabilities in connection with labor disputes or investigations, our business and financial conditions may be adversely affected.

Companies operating in the PRC are required to participate in various government sponsored employee benefit plans, including social insurance, housing funds and other welfare-oriented payment obligations, and contribute to the plans in amounts equal to specific percentages of salaries, including bonuses and allowances, of their employees up to a maximum amount specified by the local government from time to time.

plans in amounts equal to specific percentages of salaries, including bonuses and allowances, of their employees up to a maximum amount specified by the local government from time to time.

The requirement to maintain employee benefit plans has not been implemented consistently by local governments in the PRC given the different levels of economic development in different locations.

1 unchanged sentence

We may be subject to fines and penalties for any such failure to make payments in accordance with the applicable PRC laws and regulations.

We may be required to make up the contributions for these plans as wel

We may be required to make up the contributions for these plans as well as to pay late fees and fines.

If we are subject to penalties, late fees or fines in relation to any underpaid employee benefits, our financial condition and results of operations may be adversely affected.

Our business benefits from tax benefits or financial incentives and discretionary policies granted by governmental authorities in the PRC.

Expiration, elimination or reduction of these incentives or policies would have an adverse effect on our results of operations.

Governmental authorities in the PRC have granted tax benefits or financial incentives to our PRC subsidiaries as part of their efforts to encourage the development of PRC businesses, including in connection with the Contract for Granting the Right to Use State-owned Construction Land (“Land Use Agreement”

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1A. Risk Factors