Company: ZLAB
Filing Date: 2025-05-08
Form Type: 10-Q
Source: 0001628280-25-023411
Chunk: 48

Company: Zai Lab Ltd
Filing Date: 2025-05-08
Form: 10-Q
Item: Part I, Item 1
Chunk 48
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 Commercialize Our Product Candidates 

We have multiple product candidates in late-stage clinical development and various others in clinical and pre-clinical development in Greater China and globally. Our ability to generate revenue from our product candidates is dependent on our receipt of regulatory approvals for and successful commercialization of such product candidates, which may not occur. Certain of our product candidates may require additional pre-clinical and/or clinical development, regulatory approvals in multiple jurisdictions, manufacturing supply, and significant marketing efforts before we generate any revenue from product sales. 

License and Collaboration Arrangements 

Our results of operations have been, and will continue to be, affected by our license and collaboration agreements. In accordance with these agreements, we may be required to make upfront payments and milestone payments upon the achievement of certain development, regulatory, and sales-based milestones for the relevant products as well as certain royalties at tiered percentage rates based on annual net sales of the licensed products in the licensed territories. As of March 31, 2025, we may in the future be required to pay development and regulatory milestone payments of up to an additional aggregate amount of $247.5 million for our current clinical programs and $684.9 million for other programs. Such development and regulatory milestone payments are contingent on the progress of our product candidates prior to commercialization, and we see these payments as favorable because they indicate that product candidates are advancing. As of March 31, 2025, we also in the future may be required to pay sales-based milestone payments of up to an additional aggregate amount of $2,555.0 million as well as certain royalties at tiered percentage rates on annual net sales. Such sales-based milestone and royalty payments are contingent on the performance of our commercial products, and we see these payments as favorable because they signify that a product is achieving higher sales levels.

19

Results of Operations 

In this section, we discuss our results of operations for the first quarter of 2025 compared to the first quarter of 2024.

The following table presents our results of operations ($ in thousands):

Three Months Ended March 31,Change20252024$%RevenuesProduct revenue, net105,650 87,149 18,501 21 %Collaboration revenue837 — 837 NMTotal revenues106,487 87,149 19,338 22 %ExpensesCost of product revenue(38,452)(33,619)(4,833)14 %Cost of collaboration revenue(195)— (195)NMResearch