GC-502

Presenting longer-term follow-up data from investigator-initiated trial (IIT) evaluating BCMA/CD19 dual-targeting FasTCAR-T GC012F in relapsed/refractory multiple myeloma (RRMM) at 2023 ASCO and EHA2023On track to commence a Phase 1b/2 clinical trial in U.S. and a Phase 1/2 clinical trial in China evaluating GC012F for the treatment of RRMM in the second quarter and third quarter of 2023, respectivelyLaunched the new IIT evaluating GC012F in systemic lupus erythematosus (SLE)Presenting updated data from the ongoing IIT evaluating GC012F in relapsed/refractory B-cell non-Hodgkin lymphoma (r/r B-NHL) at 2023 ASCO and EHA2023Presenting the Phase 1 clinical data of donor-derived allogeneic CAR-T GC007g in relapsed/refractory B-cell acute lymphoblastic leukemia (r/r B-ALL) at EHA2023Hosting KOL call on May 22 at 9:00 am ET to highlight unmet clinical need for RRMM in U.S.Well-funded with cash runway to the end of 2024Management to host conference call at 8:00 a.m. ET today SAN DIEGO and SUZHOU, China and SHANGHAI, China, May 15, 2023 (GLOBE NEWSWIRE) -- Gracell Biotechnologies Inc. (NASDAQ: GRCL) (“Gracell” or the “Company”), a global clinical-stage biopharmaceutical company dedicated to discovering and developing highly efficacious and affordable cell therapies for the treatment of cancer and autoimmune diseases, today reported first quarter unaudited financial results for the period ended March 31, 2023, and provided corporate updates. “We continue to focus our efforts on the advancement of our lead candidate GC012F, a FasTCAR-enabled autologous CAR-T therapy candidate dual-targeting B cell maturation antigen (BCMA) and CD19. We look forward to showcasing the updated clinical data of GC012F in two indications RRMM and r/r B-NHL at both 2023 ASCO and EHA2023, including in two oral presentations. We are on track to initiate the U.S. IND trial for GC012F in RRMM in the second quarter of 2023,” said Dr. William (Wei) Cao, founder, Chairman and CEO of Gracell. “We are also pleased to present the first clinical data from the Phase 1/2 clinical trial evaluating the donor-derived allogeneic CAR-T GC007g for the treatment of r/r B-ALL at EHA2023, demonstrating a 100% minimal residual disease negative complete response or complete response with incomplete count recovery (MRD- CR/CRi) in a challenging set of patients.” Dr. Cao continued, “We are excited to announce our strategic decision to pursue clinical development in systemic lupus erythematosus (SLE) for GC012F. We believe the FasTCAR-T GC012F is well positioned as an ideal candidate for a wide range of autoimmune indications, given its CD19/BCMA dual-targeting capability, consistently favorable safety profile demonstrated in the over 50 patients treated across three IITs, and the proprietary FasTCAR manufacturing technology. We recently commenced an IIT in China in refractory SLE patients and plan to file IND in U.S. and China subsequently.” Pipeline Updates FasTCAR Platform: Next-day manufacturing for autologous CAR-T cell therapy with enhanced cell fitness. GC012F: FasTCAR-enabled autologous CAR-T therapy candidate dual-targeting BCMA and CD19, currently being evaluated for the treatment of RRMM, newly-diagnosed multiple myeloma (NDMM) and B-NHL. Longer term follow-up from a multicenter IIT evaluating GC012F for the treatment of RRMM in heavily pretreated, mostly high-risk patients will be presented as oral presentation at 2023 American Society of Clinical Oncology Annual Meeting (2023 ASCO) and as poster presentation at European Hematology Association 2023 Congress (EHA2023).Company-sponsored Phase 1b/2 clinical trial in U.S. (NCT05850234) evaluating GC012F in RRMM on track to initiate in the second quarter of 2023.Company-sponsored Phase 1/2 clinical trial in China evaluating GC012F in RRMM expected to initiate in the third quarter of 2023.Follow-up continued in the ongoing IIT evaluating GC012F in NDMM. The first clinical data presented at ASH 2022 demonstrated that one single infusion of GC012F achieved a 100% overall response rate (ORR) and 100% minimal residual disease (MRD) negativity in 16 newly-diagnosed, high risk, transplant eligible patients across all dose levels. 75% of the treated patients did not experience any cytokine release syndrome.On track to share updated clinical data in 2023. Enrollment and follow-up continued in the IIT in China evaluating GC012F in r/r B-NHL. Updated data to be presented as oral presentation at EHA2023 and as poster presentation at 2023 ASCO. Initiated a new IIT evaluating GC012F in refractory SLE. GC007g for the treatment of B-ALL: Allogeneic CD19-targeted CAR-T cell therapy, derived from human leukocyte antigen (HLA) matched donor, for the treatment of r/r B-ALL patients who failed transplant and may not be eligible for autologous CAR-T therapy. Phase 1 data to be presented at EHA2023 in a poster presentation. Between March 2021 and May 2022, nine r/r B-ALL patients were enrolled and treated in the Phase 1 portion of the registrational Phase 1/2 clinical trial at two different dose levels.At day 28 after infusion, 100% patients achieved MRD- CR/CRi.With a median follow-up duration of 445 days (range 218-649 days), seven of nine (78%) patients remained in CR/CRi. Phase 2 portion of the registration Phase 1/2 clinical trial in China is ongoing. TruUCAR Platform: Novel designs enabling “off-the-shelf” allogeneic CAR-T therapy. GC502: CD19/CD7 dual-directed allogeneic CAR-T cell therapy candidate being studied in a Phase 1 IIT in China for the treatment of B-cell malignancies. GC502 is manufactured from T cells of non-HLA-matched healthy donors. Data from an IIT evaluating GC502 in r/r B-ALL patients were presented at EHA2022. Three of four patients achieved MRD- CR/CRi at day 28 post-infusion. SMART CARTTM Technology Module: With unique construct to take advantage of the suppressive tumor microenvironment (TME) and effectively combat solid tumors, SMART CARTTM is designed to enhance CAR-T cell proliferation and duration of killing, and to resist exhaustion with improved persistence of CAR-T cells. On track to commence a China IIT for GC506 in Claudin18.2-positive solid tumors in the second quarter of 2023. Financial Results for the First Quarter Ended March 31, 2023 As of March 31, 2023, the Company had RMB1,277.3 million (US$186.0 million) in cash and cash equivalents and short-term investments. In addition, the Company had short-term borrowings and current portion of long-term borrowings of RMB122.4 million (US$17.8 million) and long-term borrowings of RMB41.7 million (US$6.1 million). Net loss attributable to ordinary shareholders for the three months ended March 31, 2023 was RMB151.7 million (US$22.1 million), compared to RMB158.6 million for the corresponding prior year period. Research and Development Expenses Research and development expenses for the three months ended March 31, 2023 were RMB137.5 million (US$20.0 million), compared to RMB121.8 million in the corresponding prior year period. The increase was primarily due to the increased spending on research, development, and clinical trials, including license expenses with Seagen Inc. Administrative Expenses Administrative expenses for the three months ended March 31, 2023 were RMB29.1 million (US$4.2 million), compared to RMB37.9 million for the corresponding prior year period. The decrease was primarily driven by a decrease in professional service as well as a decrease in share-based compensation expenses. Interest income for the three months ended March 31, 2023 was RMB14.6 million (US$2.1 million), compared to RMB2.5 million for the corresponding prior year period. Interest expense for the three months ended March 31, 2023 was RMB1.7 million (US$0.2 million), compared to RMB1.4 million for the corresponding prior year period. As of March 31, 2023, 338,573,189 ordinary shares (excluding 24,817,479 ordinary shares issued to depositary bank as of March 31, 2023, for bulk issuance of American depository shares (ADSs) reserved for future issuances upon the exercise or vesting of awards granted under our share incentive plans), par value of US$0.0001 per share, were issued and outstanding. As of March 31, 2023, 18,927,261 options were granted and 15,049,943 options were outstanding, and 1,974,391 restricted share units (“RSUs”) were granted under our employee stock option plan. Each of our ADS represents five ordinary shares. Conference Call and Webcast Details:Monday, May 15, 2023 @ 8:00am ETInvestor domestic dial-in: (800) 715-9871 Investor international dial-in: (646) 307-1963Conference ID: 2756776 Live webcast link: https://ir.gracellbio.com/news-events/events-and-presentations A replay of the webcast will be available on ir.gracellbio.com shortly after the conclusion of the event for 90 days. About FasTCARIntroduced in 2017, FasTCAR is Gracell’s revolutionary next-day autologous CAR-T cell manufacturing platform. FasTCAR is designed to lead the next generation of cancer and autoimmune disease therapy and improve outcomes for patients by enhancing efficacy, reducing costs, and enabling more patients to access critical CAR-T treatment. FasTCAR drastically shortens cell production from weeks to overnight, potentially reducing patient wait times and probability for their disease to progress. Furthermore, FasTCAR T-cells appear younger and are more robust than traditional CAR-T cells, making them more proliferative and effective at killing cancer cells. In November 2022, FasTCAR was named the winner of the Biotech Innovation category of the 2022 Fierce Life Sciences Innovation Awards for its ability to address major industry obstacles. About TruUCARTruUCAR is Gracell’s proprietary technology platform and is designed to generate high-quality allogeneic CAR-T cell therapies that can be administered “off-the-shelf” at lower cost and with greater convenience. With differentiated design enabled by gene editing of unique genes, TruUCAR is designed to control host vs graft rejection (HvG) as well as graft vs host disease (GvHD) without the need of being co-administered with additional immunosuppressive drugs. About SMART CARTTMSMART CARTTM is Gracell’s proprietary technology module designed to strengthen the functionality of CAR-T cells further, and aims to overcome tumor microenvironment (TME). SMART CARTTM includes altered expression of the receptor and signaling mechanism of an inhibitory TME molecule to enhance expansion and persistence and to reduce the exhaustion of CAR T cells. This design reverses and turns immunosuppressive signals of TME into stimulatory reactions of CAR-T cells. SMART CARTTM technology can be applied to many targets for the treatment of solid tumors. About Gracell Gracell Biotechnologies Inc. (“Gracell”) is a global clinical-stage biopharmaceutical company dedicated to discovering and developing breakthrough cell therapies. Leveraging its pioneering FasTCAR and TruUCAR technology platforms and SMART CARTTM technology module, Gracell is developing a rich clinical-stage pipeline of multiple autologous and allogeneic product candidates with the potential to overcome major industry challenges that persist with conventional CAR-T therapies, including lengthy manufacturing time, suboptimal cell quality, high therapy cost and lack of effective CAR-T therapies for solid tumors. For more information on Gracell, please visit www.gracellbio.com and follow @GracellBio on LinkedIn. Exchange Rate InformationThis announcement contains translations of certain RMB amounts into U.S. dollars at a specified rate solely for the convenience of the reader. Unless otherwise noted, all translations from Renminbi to U.S. dollars are made at a rate of RMB 6.8676 to US$1.00, the rate in effect as of March 31, 2023 published by the Federal Reserve Board. Cautionary Note Regarding Forward-Looking StatementsStatements in this press release about future expectations, plans, and prospects, as well as any other statements regarding matters that are not historical facts, may constitute “forward-looking statements” within the meaning of The Private Securities Litigation Reform Act of 1995. The words “anticipate,” “look forward to,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “should,” “target,” “will,” “would” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors, including factors discussed in the section entitled “Risk Factors” in Gracell’s most recent annual report on Form 20-F, as well as discussions of potential risks, uncertainties, and other important factors in Gracell’s subsequent filings with the U.S. Securities and Exchange Commission. Any forward-looking statements contained in this press release speak only as of the date hereof. Gracell specifically disclaims any obligation to update any forward-looking statement, whether due to new information, future events, or otherwise. Readers should not rely upon the information on this page as current or accurate after its publication date. Unaudited Condensed Consolidated Balance Sheets (All amounts in thousands, except for share and per share data) As of December 31, As of March 31, 2022 2023 RMB RMB US$ASSETS Current assets: Cash and cash equivalents 1,454,645 1,273,688 185,463 Short-term investments 3,559 3,572 520 Prepayments and other current assets 37,551 47,531 6,922 Total current assets 1,495,755 1,324,791 192,905 Property, equipment and software, net 123,126 119,958 17,467 Operating lease right-of-use assets 21,546 17,100 2,490 Other non-current assets 15,849 11,759 1,712 TOTAL ASSETS 1,656,276 1,473,608 214,574 LIABILITIES AND SHAREHOLDERS’ EQUITY Current liabilities: Accruals and other current liabilities 85,991 73,630 10,721 Short-term borrowings 104,600 109,700 15,974 Operating lease liabilities, current 17,545 14,171 2,063 Amounts due to related parties 4,662 1,439 210 Current portion of long-term borrowings 7,844 12,657 1,843 Total current liabilities 220,642 211,597 30,811 Operating lease liabilities, non-current 6,485 4,399 641 Long-term borrowings 46,505 41,692 6,071 Other non-current liabilities 6,879 5,383 784 TOTAL LIABILITIES 280,511 263,071 38,307 Shareholders’ equity: Ordinary shares 223 223 32 Additional paid-in capital 2,927,295 2,931,677 426,885 Accumulated other comprehensive income 73,528 55,646 8,103 Accumulated deficit (1,625,281) (1,777,009) (258,753)Total shareholders’ equity 1,375,765 1,210,537 176,267 TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY 1,656,276 1,473,608 214,574 Unaudited Condensed Consolidated Statements of Comprehensive Loss (All amounts in thousands, except for share and per share data) For the three months ended March 31, 2022 2023 RMB RMB US$Expenses Research and development expenses (121,837) (137,506) (20,022) Administrative expenses (37,890) (29,088) (4,236)Loss from operations (159,727) (166,594) (24,258) Interest income 2,496 14,627 2,130 Interest expense (1,425) (1,656) (241) Other income 143 631 92 Foreign exchange gain/(loss), net (71) 1,281 187 Others, net 1 (1) — Loss before income tax (158,583) (151,712) (22,090) Income tax expense — (16) (2)Net loss (158,583) (151,728) (22,092)Net loss attributable to Gracell Biotechnologies Inc.’s ordinary shareholders (158,583) (151,728) (22,092)Other comprehensive loss Foreign currency translation adjustments, net of nil tax (6,437) (17,882) (2,604)Total comprehensive loss attributable to Gracell Biotechnologies Inc.’s ordinary shareholders (165,020) (169,610) (24,696)Weighted average number of ordinary shares used in per share calculation: —Basic 338,131,447 338,552,074 338,552,074 —Diluted 338,131,447 338,552,074 338,552,074 Net loss per share attributable to Gracell Biotechnologies Inc.’s ordinary shareholders —Basic (0.47) (0.45) (0.07) —Diluted (0.47) (0.45) (0.07)

Plan to commence Phase 1b/2 clinical trial in US evaluating FasTCAR-T GC012F for the treatment of relapsed/refractory multiple myeloma (RRMM) in the second quarter of 2023 after receipt of FDA clearance for Investigational New Drug (IND) application in January 2023 On track to commence Phase 1/2 clinical trial in China evaluating FasTCAR-T GC012F in RRMM in the third quarter 2023 following receipt of NMPA clearance for IND application in February 2023 Continuing patient enrollment and follow-up in the ongoing IIT evaluating FasTCAR-T GC012F in relapsed/refractory B-Cell non-Hodgkin lymphoma (r/r B-NHL) On track to commence a China IIT for SMART CAR-T GC506 in Claudin18.2-positive solid tumors in first half of 2023 Well-funded with cash runway to the end of 2024 Management to host conference call at 8:00 a.m. ET today SAN DIEGO and SUZHOU, China and SHANGHAI, China, March 13, 2023 (GLOBE NEWSWIRE) -- Gracell Biotechnologies Inc. (NASDAQ: GRCL) (“Gracell” or the “Company”), a global clinical-stage biopharmaceutical company dedicated to discovering and developing highly efficacious and affordable cell therapies for the treatment of cancer, today reported fourth quarter and full year 2022 unaudited financial results for the period ended December 31, 2022, and provided corporate updates. “Our lead candidate GC012F, the BCMA/CD19 dual-targeting FasTCAR-T therapy, has demonstrated encouraging efficacy and differentiated safety pro the 48 patients treated across three indications in three studies. This gives us a high level of conviction in the significant therapeutic potential of GC012F in a wide range of hematology and immunology indications. We recently received IND clearances from both the US FDA and China NMPA, and are on track to commence enrollment in these two Company-sponsored trials in RRMM in the coming months,” said Dr. William (Wei) Cao, founder, Chairman and CEO of Gracell. “Moreover, we plan to provide an important clinical data update on the response durability of GC012F in RRMM in mid-year 2023.” Dr. Cao continued, “Concurrently, we are expanding Gracell’s clinical pipeline across our technology platforms, including initiating a China IIT for SMART CAR-T GC506 in Claudin18.2-positive solid tumors in first half of 2023.” Pipeline Updates FasTCARPlatform: Next-day manufacturing for autologous CAR-T cell therapy with enhanced cell fitness. GC012F: Autologous CAR-T therapy candidate dual-targeting B cell maturation antigen (BCMA) and CD19, currently being evaluated for the treatment of RRMM, newly-diagnosed multiple myeloma (NDMM) and r/r B-NHL. Company-sponsored Phase 1b/2 clinical trial in US evaluating GC012F for the treatment of RRMM on track to initiate in the second quarter 2023. Received FDA clearance for IND application in January 2023. Phase 1b portion of the trial is designed to evaluate the safety and tolerability of GC012F in two dose levels in approximately 12 patients and to determine the recommended Phase 2 dose (RP2D). In the current protocol, the Phase 2 portion is intended to evaluate the efficacy in approximately 50 patients and further characterize the safety. Company-sponsored Phase 1/2 clinical trial in China evaluating GC012F in RRMM expected to initiate in the third quarter 2023. Received China NMPA clearance for IND application in February 2023 Phase 1 portion of the trial is designed to evaluate the safety and tolerability of GC012F in two dose levels in approximately nine patients and to determine the RP2D. In the current protocol, the Phase 2 portion is intended to evaluate the efficacy in up to 98 patients and further characterize the safety. Presented at ASH 2022 the first clinical data from ongoing investigator-initiated (IIT) evaluating GC012F in transplant-eligible, high risk NDMM Demonstrated a 100% overall response rate (ORR) and 100% minimal residual disease (MRD) negativity in all 16 treated patients across all dose levels. 75% of the treated patients did not experience any grade of cytokine release syndrome. Enrollment and follow-up continuing in the ongoing IIT. Enrollment and follow-up progressing in the IIT in China evaluating GC012F in r/r B-NHL. TruUCAR Platform: Novel designs enabling “off-the-shelf” allogeneic CAR-T therapy. GC502: CD19/CD7 dual-directed allogeneic CAR-T cell therapy candidate being studied in an ongoing Phase 1 IIT in China for the treatment of B-cell malignancies. GC502 is manufactured from T cells of non-human leukocyte antigen (HLA) matched healthy donors. Presented at EHA 2022 the updated data from single-arm, open-label IIT with longer follow-up of GC502 in B-cell acute lymphoblastic leukemia (B-ALL). SMART CART™ Technology module: With unique construct to take advantage of the suppressive tumor microenvironment (TME) and effectively combat solid tumors, SMART CART™ is designed to enhance CAR-T cell proliferation and duration of killing, and to resist exhaustion with improved persistence of CAR-T cells. Plan to commence a China IIT for GC506 in Claudin18.2-positive solid tumors in first half of 2023. GC007g for the treatment of B-ALL: Allogeneic CD19-targeted CAR-T cell therapy, derived from HLA-matched donor, for the treatment of r/r B-ALL patients who failed transplant and may not be eligible for autologous CAR-T therapy. Phase 2 portion of the registration Phase 1/2 clinical trial in China evaluating GC007g for the treatment of r/r B-ALL is ongoing. Financial Results for the Fourth Quarter and Full Year 2022 As of December 31, 2022, the Company had RMB1,458.2 million (US$211.4 million) in cash and cash equivalents and short-term investments. Net loss attributable to ordinary shareholders for the three months ended December 31, 2022 was RMB130.7 million (US$18.9 million), compared to RMB128.6 million for the same period in 2021. Net loss attributable to ordinary shareholders for the full year ended December 31, 2022 was RMB607.5 million (US$88.1 million), compared to RMB453.7 million for the same period in 2021. Research and Development Expenses Research and development expenses for the three months ended December 31, 2022 were RMB113.1 million (US$16.4 million), as compared to RMB107.6 million for the same period in 2021. For the full year ended December 31, 2022, research and development expenses were RMB485.4 million (US$70.4 million), compared to RMB326.9 million for the same period in 2021. The increase was primarily due to the increased spending on research, development, and clinical trials, as well as higher payroll and personnel expenses attributable to increased headcount, and higher facility-related costs in support of continuing expansion of research and development activities. Administrative Expenses Administrative expenses for the three months ended December 31, 2022 were RMB36.2 million (US$5.2 million), compared to RMB32.0 million for the same period in 2021. For the full year ended December 31, 2022, administrative expenses were RMB139.3 million (US$20.2 million), compared to RMB137.0 million for the same period in 2021. The increase was primarily driven by an increase in payroll and personnel expenses due to the expansion of administrative functions. As of December 31, 2022, 338,498,819 ordinary shares, par value of US$0.0001 per share, were issued and outstanding. As of December 31, 2022, 18,865,761 options were granted and 15,162,546 options were outstanding, and 1,974,391 restricted share units (“RSUs”) were granted under our employee stock option plan. Each of our ADS represents five ordinary shares. Conference Call and Webcast Details: Monday, March 13, 2023 @ 8 a.m. ET Investor domestic dial-in: (800) 715-9871 Investor international dial-in: +1(646) 307-1963 Conference ID: 5617240 Live webcast link: A replay of the webcast will be available on ir.gracellbio.com shortly after the conclusion of the event for 90 days. About FasTCAR CAR-T cells manufactured on Gracell’s proprietary FasTCAR platform appear younger, less exhausted, and show enhanced proliferation, persistence, bone marrow migration, and tumor cell clearance activities as demonstrated in preclinical studies. With next-day manufacturing, FasTCAR is able to significantly improve cell production efficiency, which may result in meaningful cost savings, increasing the accessibility of cell therapies for cancer patients. About TruUCAR TruUCAR is Gracell’s proprietary technology platform and is designed to generate high-quality allogeneic CAR-T cell therapies that can be administered “off-the-shelf” at lower cost and with greater convenience. With differentiated design enabled by gene editing of unique genes, TruUCAR is designed to control host vs graft rejection (HvG) as well as graft vs host disease (GvHD) without the need of being co-administered with additional immunosuppressive drugs. About SMART CART™ SMART CART™ is Gracell’s proprietary technology module designed to strengthen the functionality of CAR-T cells further, and aims to overcome tumor microenvironment (TME). SMART CART™ includes altered expression of the receptor and signaling mechanism of an inhibitory TME molecule to enhance expansion and persistence and to reduce the exhaustion of CAR T cells. This design reverses and turns immunosuppressive signals of TME into stimulatory reactions of CAR-T cells. SMART CART™ technology can be applied to many targets for the treatment of solid tumors. About Gracell Gracell Biotechnologies Inc. (“Gracell”) is a global clinical-stage biopharmaceutical company dedicated to discovering and developing breakthrough cell therapies. Leveraging its pioneering FasTCAR and TruUCAR technology platforms and SMART CART™ technology module, Gracell is developing a rich clinical-stage pipeline of multiple autologous and allogeneic product candidates with the potential to overcome major industry challenges that persist with conventional CAR-T therapies, including lengthy manufacturing time, suboptimal cell quality, high therapy cost and lack of effective CAR-T therapies for solid tumors. For more information on Gracell, please visit and follow @GracellBio on LinkedIn. Exchange Rate Information This announcement contains translations of certain RMB amounts into U.S. dollars at a specified rate solely for the convenience of the reader. Unless otherwise noted, all translations from Renminbi to U.S. dollars are made at a rate of RMB 6.8972 to US$1.00, the rate in effect as of December 31, 2022 published by the Federal Reserve Board. Cautionary Note Regarding Forward-Looking Statements Statements in this press release about future expectations, plans, and prospects, as well as any other statements regarding matters that are not historical facts, may constitute “forward-looking statements” within the meaning of The Private Securities Litigation Reform Act of 1995. The words “anticipate,” “look forward to,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “should,” “target,” “will,” “would” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors, including factors discussed in the section entitled “Risk Factors” in Gracell’s most recent annual report on Form 20-F, as well as discussions of potential risks, uncertainties, and other important factors in Gracell’s subsequent filings with the U.S. Securities and Exchange Commission. Any forward-looking statements contained in this press release speak only as of the date hereof. Gracell specifically disclaims any obligation to update any forward-looking statement, whether due to new information, future events, or otherwise. Readers should not rely upon the information on this page as current or accurate after its publication date. Unaudited Condensed Consolidated Balance Sheets (All amounts in thousands, except for share and per share data) As of December 31, 2021 2022 RMB RMB US$ ASSETS Current assets: Cash and cash equivalents 1,829,006 1,454,645 210,904 Short-term investments 3,615 3,559 516 Prepayments and other current assets 52,459 37,551 5,443 Total current assets 1,885,080 1,495,755 216,863 Property, equipment and software, net 123,818 123,126 17,852 Operating lease right-of-use assets 29,652 21,546 3,124 Other non-current assets 21,587 15,849 2,298 TOTAL ASSETS 2,060,137 1,656,276 240,137 LIABILITIES AND SHAREHOLDERS’ EQUITY Current liabilities: Accruals and other current liabilities 69,120 85,991 12,467 Short-term borrowings 66,100 104,600 15,166 Operating lease liabilities, current 17,527 17,545 2,544 Amounts due to related parties — 4,662 676 Current portion of long-term borrowings 2,376 7,844 1,137 Total current liabilities 155,123 220,642 31,990 Operating lease liabilities, non-current 14,830 6,485 940 Long-term borrowings 54,349 46,505 6,743 Other non-current liabilities 8,464 6,879 997 TOTAL LIABILITIES 232,766 280,511 40,670 Shareholders’ equity: Ordinary shares 223 223 32 Additional paid-in capital 2,902,856 2,927,295 424,418 Accumulated other comprehensive income/(loss) (57,936 ) 73,528 10,661 Accumulated deficit (1,017,772 ) (1,625,281 ) (235,644 ) Total shareholders’ equity 1,827,371 1,375,765 199,467 TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY 2,060,137 1,656,276 240,137 Unaudited Condensed Consolidated Statements of Comprehensive Loss (All amounts in thousands, except for share and per share data) For the three months ended December 31, For the years ended December 31, 2021 2022 2021 2022 RMB RMB US$ RMB RMB US$ Revenue Licensing and collaboration revenue — — — 366 — — Expenses Research and development expenses (107,582 ) (113,143 ) (16,404 ) (326,899 ) (485,388 ) (70,375 ) Administrative expenses (31,998 ) (36,180 ) (5,246 ) (137,040 ) (139,270 ) (20,192 ) Loss from operations (139,580 ) (149,323 ) (21,650 ) (463,573 ) (624,658 ) (90,567 ) Interest income 3,466 15,136 2,194 9,116 23,917 3,468 Interest expense (1,327 ) (1,791 ) (260 ) (5,063 ) (6,737 ) (977 ) Other income 8,254 3,964 575 9,120 8,001 1,160 Foreign exchange gain/(loss), net 606 1,315 191 (1,297 ) (8,169 ) (1,184 ) Others, net (4 ) 27 4 (57 ) 159 23 Loss before income tax (128,585 ) (130,672 ) (18,946 ) (451,754 ) (607,487 ) (88,077 ) Income tax expense — (22 ) (3 ) — (22 ) (3 ) Net loss (128,585 ) (130,694 ) (18,949 ) (451,754 ) (607,509 ) (88,080 ) Accretion of convertible redeemable preferred shares to redemption value — — — (1,989 ) — — Net loss attributable to Gracell Biotechnologies Inc.’s ordinary shareholders (128,585 ) (130,694 ) (18,949 ) (453,743 ) (607,509 ) (88,080 ) Other comprehensive income/(loss) Foreign currency translation adjustments, net of nil tax (30,225 ) (25,183 ) (3,651 ) (34,024 ) 131,464 19,060 Total comprehensive loss attributable to Gracell Biotechnologies Inc.’s ordinary shareholders (158,810 ) (155,877 ) (22,600 ) (487,767 ) (476,045 ) (69,020 ) Weighted average number of ordinary shares used in per share calculation: —Basic 337,853,025 338,457,977 338,457,977 328,866,599 338,342,051 338,342,051 —Diluted 337,853,025 338,457,977 338,457,977 328,866,599 338,342,051 338,342,051 Net loss per share attributable to Gracell Biotechnologies Inc.’s ordinary shareholders —Basic (0.38 ) (0.39 ) (0.06 ) (1.38 ) (1.80 ) (0.26 ) —Diluted (0.38 ) (0.39 ) (0.06 ) (1.38 ) (1.80 ) (0.26 ) Media contact: Marvin Tang marvin.tang@gracellbio.com Investor contact: Gracie Tong gracie.tong@gracellbio.com