Gyre Therapeutics Q1 2024 Financial Results and Business Update

Gyre Therapeutics, a clinical-stage biotechnology company focused on developing treatments for chronic organ diseases, announced their financial outcomes for the first quarter ending March 31, 2024, alongside an update on their ongoing business and clinical developments.

Financial Overview
For the first quarter of 2024, Gyre Therapeutics reported total revenues of $27.2 million, an increase from $24.9 million in the same period of the previous year. This rise was driven by a $2.2 million uptick in pharmaceutical sales, attributed to enhanced marketing and sales activities in the PRC. The cost of revenues decreased slightly to $1.0 million from $1.1 million, mainly due to lower raw material costs.

Operating expenses saw a slight decrease to $19.1 million from $18.3 million in Q1 2023. Selling and marketing costs decreased marginally to $12.5 million, owing to reduced conference costs despite increased staff expenses. Research and development expenses dropped to $2.2 million from $2.6 million due to lower clinical trial and preclinical research expenses. However, general and administrative expenses doubled to $3.4 million, driven by higher payroll and miscellaneous expenses.

Gyre's income from operations for Q1 2024 was $8.1 million, up from $6.7 million in Q1 2023. Net income rose significantly to $9.9 million from $4.2 million in the prior year. The net income attributable to common stockholders also increased to $7.5 million from $2.2 million.

Clinical Development Highlights
Gyre is advancing several key programs addressing various chronic organ diseases:

1. F351 (Hydronidone): The Phase 3 trial evaluating F351 for the treatment of Chronic Hepatitis B (CHB)-associated liver fibrosis in the PRC is progressing well, with topline data expected by early 2025. The trial, which enrolled 248 patients, aims to reduce liver fibrosis scores using a combination of F351 and entecavir. Gyre plans to initiate a Phase 2a trial for F351 in Non-Alcoholic Steatohepatitis (NASH)-associated liver fibrosis in the U.S. in 2025, pending FDA approval.

2. F573: Gyre is conducting a Phase 2 clinical trial in the PRC to evaluate F573, a caspase inhibitor, for treating acute and acute-on-chronic liver failure (ALF/ACLF).

3. F230: In preclinical studies, F230, a selective endothelin receptor agonist, is being evaluated for the treatment of pulmonary arterial hypertension (PAH). An IND application for F230 was submitted in March 2024.

4. F528: This novel anti-inflammatory agent is being studied preclinically for its potential to treat chronic obstructive pulmonary disease (COPD) with low toxicity. 

Corporate Developments
In May 2024, Gyre Pharmaceuticals signed an agreement with Jiangsu Wangao Pharmaceuticals to acquire assets and expertise related to the kinase inhibitor nintedanib, aimed at treating idiopathic pulmonary fibrosis. This acquisition is expected to enhance Gyre's competitiveness and broaden patient access to nintedanib in the PRC.

Cash Position
As of March 31, 2024, Gyre had cash and cash equivalents of $29.8 million, down from $33.5 million at the end of 2023. This reduction was primarily due to net cash used in investing activities and increased operational costs.

Looking Ahead
Gyre is well-positioned to continue its growth trajectory, supported by the strong performance of their market-leading IPF drug, ETUARY. The company remains focused on advancing its clinical development programs for treatments targeting fibrotic and inflammatory conditions. With several key milestones anticipated in the coming years, including the Phase 3 trial results for F351 and the initiation of the Phase 2a trial in the U.S., Gyre aims to bring innovative therapies to patients in need.

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