Company: ZLAB
Filing Date: 2025-02-27
Form Type: 10-K
Source: 0001628280-25-008409
Chunk: 30

Company: Zai Lab Ltd
Filing Date: 2025-02-27
Form: 10-K
Item: Item 16
Chunk 30
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 2023, the Company returned a portion of the land use rights and received cash in an amount equal to the respective portion of the original acquisition cost.(m) Long-Term Deposits Long-term deposits represent amounts paid in connection with the Company’s long-term lease agreements. (n)  Intangible Assets Intangible assets for commercial products include capitalized post-approval milestone fees and acquired commercial manufacturing know-how and related development costs. The Company is amortizing intangible assets for commercial products as cost of product revenue over the estimated remaining useful life of the related products, which is generally based on expected patent life, the contractual period of the underlying license agreement, and expected commercial benefits of the products. Intangible assets for externally purchased software are amortized over three to five years on a straight-line basis. (o) Impairment of Long-Lived Assets The Company evaluates long-lived assets, which includes intangible assets, tangible assets, and ROU assets for impairment whenever events or changes in circumstances indicate that the carrying value of these assets may not be recoverable. Recoverability of these assets is measured by comparison of the carrying amount of the related asset group to its future undiscounted cash flows. The Company measures the amount of impairment, if any, based on the difference between the carrying value and the estimated fair value of the impaired asset group. (p) Fair Value Measurements The Company applies ASC Topic 820, Fair Value Measurements and Disclosures, in measuring fair value (“ASC 820”). ASC 820 defines fair value, establishes a framework for measuring fair value, and requires disclosures to be provided on fair value measurement. ASC 820 establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows: Level 1 — Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.Level 2 — Include other inputs that are directly or indirectly observable in the marketplace. Level 3 — Unobservable inputs which are supported by little or no market activity. 

F-14

Zai Lab LimitedNotes to the Consolidated Financial StatementsFor the Years Ended December 31, 2024, 2023, and 2022

ASC 820 describes three main approaches to measuring the fair value of assets and liabilities: (i) market approach; (ii) income approach; and (iii) cost approach. The market approach uses prices and other relevant information generated from market transactions involving identical or comparable assets or liabilities. The income approach uses valuation techniques to convert future amounts to a