Company: ZLAB
Filing Date: 2025-11-06
Form Type: 10-Q
Source: 0001704292-25-000024
Chunk: 51

Company: Zai Lab Ltd
Filing Date: 2025-11-06
Form: 10-Q
Item: Part I, Item 1
Chunk 51
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 license or collaboration agreements or incur any milestone fees under our existing significant license and collaboration agreements. Other License and Collaboration Arrangements That Are Not Individually Significant

The Company recorded upfront fees of $20.0 million into research and development expenses in the nine months ended September 30, 2025 for license and collaboration agreements that are not individually significant. 

15. Other Income (Expense), Net 

The following table presents the Company’s other income, net ($ in thousands):Three Months Ended September 30,Nine Months Ended September 30,2025202420252024Government grants854 3,861 4,720 7,186 Loss on equity investments with readily determinable fair value— (920)(1,912)(6,067)Other miscellaneous gain (loss)(1,362)500 237 2,740 Total(508)3,441 3,045 3,859 

16. Restricted Net Assets 

Chinese laws and regulations restrict the Company’s ability to receive distributions of funds from its Chinese subsidiaries. For example, relevant Chinese laws and regulations permit payments of dividends by the Company’s Chinese subsidiaries only out of its retained earnings, if any, as determined in accordance with Chinese accounting standards and regulations.  In accordance with the Company Law of the People’s Republic of China, each Chinese subsidiary of the Company is required to provide statutory reserves of at least 10% of its annual after-tax profit until such reserve has reached 50% of its respective registered capital based on the enterprise’s Chinese statutory accounts. The reserves can only be used for specific purposes and are not distributable as cash dividends. Foreign exchange and other regulations in mainland China may further restrict the Company’s Chinese subsidiaries from transferring out funds in the form of dividends, loans, and advances.No appropriation to statutory reserves was made in the three and nine months ended September 30, 2025 and 2024 because the Chinese subsidiaries had substantial losses during such periods. The Company did not receive any distributions from its Chinese subsidiaries; such distributions were not permitted under Chinese laws and regulations due to the reserve 

15

Zai Lab Limited Notes to the unaudited condensed consolidated financial statements 

requirements discussed above. As of both September 30, 2025 and December 31, 2024, amounts restricted included the paid-in capital of the Company’s subsidiaries in mainland China and were $506.0 million.

17. Commitments and Contingencies 

(a) Purchase Commitments  As of September 30,