NovaBridge Biosciences (NBP) 2020 Q4 法說會逐字稿

Good day, ladies and gentlemen. Thank you for standing by, and welcome to the I-Mab Biopharma 2020 Financial Results and Business Update Conference Call. (Operator Instructions).

It is now my pleasure to turn the conference over Jielun Zhu, I-Mab's Chief Financial Officer and Director. Please go ahead, sir.

All right. Thank you, operator. Everyone, welcome to the I-Mab 2020 Full Year Financial Results and Business Update Conference Call. Earlier today, we issued a press release providing a review of our financial results for the full year ended December 31, 2020 as well as an overview of our recent corporate highlights and upcoming milestones. The press release can be accessed on the investors portion of our corporate website.

Joining me today on the call from I-Mab's senior management team are Dr. Jingwu Zang, our Founder, Chairman and Director; Dr. Joan Shen, our Chief Executive Officer and Director; and Mr. Yifei Zhu, our Chief Commercial Officer.

Dr. Zang will provide a high-level overview of our business strategy, recent achievements and upcoming milestones. Dr. Shen will then comment on the status of our key development programs in greater detail. Mr. Yifei Zhu will offer some remarks on our commercialization strategy, and I will then provide a brief summary of our financial results for the full year ended December 31, 2020, before we turn the call back over to the operator to take your questions.

Please note the discussion today will contain forward-looking statements relating to the company's future performance and are intended to qualify for the safe harbor from liability as established by the U.S. Private Securities Litigation Reform Act. Such statements are not guarantees of future performance and are subject to certain risks and uncertainties, assumptions and other factors. Some of these risks are beyond the company's control and could cause actual results to differ materially from those mentioned in today's press release and this call. A general discussion of the risk factors that could affect I-Mab's business and financial results is included in certain filings of the company with the Securities and Exchange Commission. The company does not undertake any obligation to update this forward-looking information, except as required by law.

During today's call, we will also discuss certain non-GAAP financial measures for comparison purposes only. For a definition of non-GAAP financial measures and a reconciliation of GAAP to non-GAAP financial results, please see the financial results news release issued earlier today.

Now without further ado, I will now turn the call over to Dr. Jingwu Zang, our Founder, Chairman and Director. Dr. Zang, please go ahead.

Thank you, Jielun. Thank you to everyone for joining us. It is a pleasure to welcome all of you to our call today to discuss our business update and financial results for 2020. I'm happy to set a stage for the discussions at this call.

Since our IPO a year ago, we have made remarkable progress and delivered outstanding results in the following 3 areas: rapidly advancing our globally competitive pipeline; establishing global deals; and building our commercial and manufacturing capabilities towards an integrated global biopharma company.

First, I would like to tell you about our rapidly advancing pipeline. Despite the challenges we faced by the global pandemic, we remain focused and managed to accomplish 18 significant clinical milestones since January 2020. And as a result, our pipeline today has progressed to include 3 registrational trials with the first NDA on track for submission this year as well as 16 Phase I and Phase II clinical trials either ongoing or to be soon initiated in both the United States and China. It is a really remarkable achievement by the company.

Our innovative pipeline consists of 16 novel or highly differentiated assets with 11 in clinical development stages and 5 in the preclinical stage. The 2 pre-NDA stage assets, CD38 antibody, felzartamab; TJ202, a long-acting growth hormone, TJ101 are progressing rapidly towards NDA in China. In addition, 2 highly differentiated clinical assets CD47 antibody, lemzoparlimab or TJC4; and CD73 antibody, uliledlimab, TJD5, have advanced to become global frontrunners in their own drug classes. Moreover, our bi-specific antibodies are now moving into clinical trials in the U.S.. A series of critical development milestones have been accomplished across our deep and growing pipeline.

On the business development front, we have achieved a landmark deal of a global collaboration with AbbVie for lemzoparlimab, our highly differentiated CD47 antibody, last September. As you know, our corporate strategy is to discover and develop novel or highly differentiated assets internally and out-license the ex China rights of some of our globally competitive pipeline assets to big pharma companies. This has been exemplified by our global collaboration deal with AbbVie. I-Mab granted AbbVie a global license value at USD 1.94 billion to receive an upfront payment of $180 million and the first milestone payments of $20 million in 2020.

I-Mab retains the rights to develop and commercialize lemzoparlimab in Greater China. We believe that this global collaboration with AbbVie will greatly facilitate the clinical development, manufacturing and commercialization of lemzoparlimab globally and in China.

Now going forward, we will stay focused on the 3 areas to continue create value for the company and our shareholders. Firstly, we will strive to accelerate our pipeline development to deliver on a series of critical milestones, which I will talk about in detail.

Secondly, we will forge more potential global out-licensing partnerships for uliledlimab and other innovative assets currently being developed in our pipeline. We will also selectively in-license late-stage assets of globally marketed products to enrich our current pipeline.

Thirdly, we will facilitate the ongoing transition of the company towards integrated global biopharma by building the manufacturing and commercialization capabilities.

Now let me first elaborate on our pipeline development. 2020 was a year when many of our assets advanced into clinical development stage. Now 2021 will be a year of harvest in terms of clinical data readouts and initiation of a more advanced and data-rich clinical trials.

In terms of data readouts, for felzartamab, our CD38 monoclonal antibody, we will release a final clinical data on the current multiple myeloma registrational clinical study followed by our NDA submission in the second half of this year. For uliledlimab, our CD73 monoclonal antibody, we plan to present Phase I data from a combination trial of uliledlimab with atezo at ASCO Annual Meeting in June.

For lemzoparlimab, we will have top line clinical results from 2 ongoing combination clinical studies by the fourth quarter 2021 this year: one is with pembro in patients with lung cancer and ovarian cancer; and the other is with rituximab in patients with non-Hodgkin's lymphoma as an international clinical trial involving clinical sites both in U.S. and China.

In addition, a combination trial of lemzoparlimab with AZA in untreated AML or MDS patients is expected to achieve for patient enrollment at the end of this year. The results will potentially help bridge to a registrational clinical trial in China once approved by China's NMPA. It should be noted that our prioritized goal for lemzoparlimab is to rapidly advance towards registration in China through accelerated development time line for selected hematologic malignancies, such as MDS and non-Hodgkin's lymphoma.

We will also present the data on our other clinical assets this year, including Phase II clinical trial for olamkicept, TJ301, in active ulcerative colitis in Greater China and South Korea. And a Phase II interim data readout for plonmarlimab, TJM2, U.S. trial for cytokine release syndrome associated with severe COVID-19. 2021 promises to be a more productive year in terms of pipeline development.

In addition to the anticipated clinical data readout, as I just summarized, we will also initiate a series of new clinical trials this year. This new clinical trials are designed to generate critical clinical data that are needed to advance the assets to pivotal clinical studies.

For felzartamab, we expect to initiate a Phase Ib trial in patients with SLE following the approval by the NMPA in China in the second half of this year. With the preclinical data generated in-house, we have planned to initiate a combination clinical trial of felzartamab with lemzoparlimab as a possible new treatment option for patients with multiple myeloma, with the potential to become the first line treatment if proven.

For lemzoparlimab, we will initiate a new clinical trial in combination with PD-1 therapy in patients with selected solid tumors in the second half of this year in China. For TJ107, our long-acting interleukin-7, in addition to the ongoing Phase II clinical trial in patients with we will start another Phase II combination trial with a PD-1 antibody in China, following the approval by the NMPA in patients with selected tumor types, including triple-negative breast cancer.

In addition to the progress on our pre-NDA and core clinical assets, our novel bi-specific antibody panel has made a headway towards clinical development. I would like to highlight 2 of them here as we have already received IND approvals from the U.S. FDA to start the clinical trials in the U.S. The first one is TJ-L14B and it is a differentiated PD-L1-based bi-specific antibody that works through 4-1BB that is only active locally at a tumor site to minimize liver toxicity commonly seen with 4-1BB monoclonal antibody. We are working with our partner, ABL Bio to initiate a Phase I clinical trial in patients with advanced metastatic solid tumors in the U.S.

The other one is TJ-CD4B, and it is a novel bi-specific antibody that combines Claudin 18.2 a specific tumor antigen for gastric cancer and pancreatic cancer with a similar 4-1BB that is only active locally at the tumor site. As a matter of fact, we just received U.S. FDA approval of our IND application and expect to start Phase I clinical trial in patients with advanced solid tumors, including gastric cancer in the U.S.

On the discovery side, we recently announced our plans to generate the next-generation innovative assets to expand our immuno-oncology pipeline. The initiative leverages certain transformative platform technologies through collaboration with other companies. Two recent examples are our collaborations with Complix, an EU-based biotech company, for cell penetrating antibodies for intractable intracellular drug targets and a company called Affinity, a Shanghai-based biotech company, for a series of masked antibodies for intratumoral activation of new antibody candidates.

Now let me say a few words about our continued business development activity around global partnerships as a part of our business model. We will continue to seek partnerships for other globally competitive assets such as uliledlimab and novel bi-specific antibodies. In parallel, we will also in-license late-stage innovative assets of globally marketed products to strategically enrich our pipeline as we move towards commercialization.

We must build our future to become a global biopharma company, while staying focused on delivery on the critical clinical and corporate milestones to generate near-term value. In this regard, we will continue building a state-of-the-art GMP manufacturing facility in China with a pilot plant and a commercial scale production lines. We aim to put our pilot plant in full operation by 2022 and commercial production in 2023 to support clinical trial material supply and drug supply for our commercial products.

The facility will exclusively serve I-Mab's CMC manufacturing needs and will enable I-Mab to control the quality and the manufacturing schedules tailored to our development and commercialization needs. Importantly, it will significantly reduce our production costs and cost of goods as a whole.

The other area is related to our commercialization strategy and plan. To summarize here, we have begun to execute our commercialization plan that focuses on building a leading position in hematologic oncology in China, leveraging our core assets, including felzartamab and the lemzoparlimab and additional key products to be in-licensed. Our Chief Commercial Officer, Yifei Zhu, will elaborate further in this call. Now preparation work is underway for commercialization of felzartamab and TJ101 as the 2 assets advancing rapidly towards NDA.

Through continued out-licensing efforts our current revenue stream generated by global and regional out-licensing deals will grow and is expected to converge with sales revenues to be generated in the near term, projecting a very promising financial outlook for our company and our shareholders. It is important to mention that I-Mab became profitable in 2020. Jielun will elaborate in his part of this call.

With this overview, I will now turn the call over to Dr. Joan Shen, our CEO, who will review the status of active programs in greater detail. Dr. Shen?

Thank you, Dr. Zang. Let me begin with our core global frontrunner assets. And first, lemzoparlimab, also know that TJC4, has taken into center stage among our core assets as we enter into the late phase of development. This is internally discovered and developed and highly differentiated CD47 antibody, also represents 1 of our most active programs.

As we have discussed in the past, lemzoparlimab is designed to minimize its binding to normal red blood while preserving its strong antitumor activity. This unique feature enables lemzoparlimab be differentiated and potentially hold the advantages in safety, favorable PK profile or lack of sink effect skipping the need for priming dosing strategy in comparison to other CD47 antibodies that bind strongly to red blood cells.

Data from our Phase I U.S. dose escalation study where cancer patients were given different doses of lemzoparlimab from 1 to 30 milligrams per kilo were managed for drug safety, tolerability and PK/PD profile. The results of these dose escalation studies were able to validate the clinical differentiation. The data have been presented at SITC and sited in November of last year, showed lemzoparlimab was well tolerated up to 30 milligrams per kilo on a weekly infusion schedule as a single agent with no dose-limiting toxicity and no clinical or laboratory evidence of hemolytic anemia were observed.

In addition, lemzoparlimab exhibited a favorable PK/PD profile does not require a primary dosing strategy and show preliminary clinical efficacy to 2 partial response and 3 stable disease in the sample of 15 evaluable patients.

This ongoing U.S. Phase I study has been expanded into a combination treatment with pembrolizumab in cancer patients with NSCLC and ovarian cancer. The results of the ongoing clinical study are expected in the fourth quarter of 2021. With more clinical data coming from our ongoing U.S. clinical trial, from the reports about other companies of the same kind, and more importantly, from our translational medicine research where specimens of various tumor types are analyzed for the level of CD47 expression, we are in a better position to initiate a Phase II basket clinical trial in patients with advanced solid tumors that are selected for a higher probability of success in the second half of 2021 in China, which may subsequently lead to a pivotal trial later in China.

Concurrently, we are running a combination study with rituximab in patients with non-Hodgkin's lymphoma and enrolling patients for U.S. and China simultaneously through our IMCT mechanism in order to potentially bridge to a registrational clinical trial in NHL in China. The preliminary later readout of this trial is expected in the fourth quarter of this year.

In China, our prioritized development goal is to accelerate the development of lemzoparlimab and achieve approval as fast as we can and as the first CD47 antibody product in China. MDS and possible NHL are being considered as a potential first in patients as we hold the highest probability of success for accelerating approval. With IND already approved, we are about to start and advance the Phase II clinical study in combination with azacitidine with 2 dose arms, which are patients with AML and MDS, respectively. This trial could potentially bridge to a registrational trial in patients with MDS in China next year.

Secondly, our uliledlimab, or TJD5. It represents another promising immuno-oncology target under clinical development globally. Uliledlimab is shown to strongly suppress tumor growth especially when combined with the PD-1 or PD-L1 inhibitor in preclinical studies. As Dr. Zang mentioned earlier, we have completed our Phase I clinical trial in the U.S. The top line results demonstrated safety and clinical activities. These results have been submitted to ASCO 2021 Annual Meeting for presentation in June.

In China, we have nearly completed ongoing Phase I dose escalation study as a single agent and in combination with toripalimab in patients with advanced or metastatic cancers who are refractory to or intolerant of available therapies. We are now to expand the clinical study to further evaluate clinical activities in combination with toripalimab in selected solid tumors in a basket trial design by leveraging the data from the uliledlimab trial in the U. S.

The first patient dosing of this combination trial was achieved in February 2021. The expansion study in patients with NSCLC and other selected tumors have been initiated in over 15 sites across China. The preliminary results are expected in 2022.

Next, I would like to talk about our pre-NDA assets in China. First, felzartamab or TJ202. This is a compound originally developed by our partner MorphoSys. It is currently in development for multiple myeloma and autoimmune diseases, such as systemic lupus erythematosus or SLE. We immediately after our in-licensing, we formulated a robust clinical development strategy, targeting an NDA submission with NMPA in 2021. The registrational trial for the treatment in combination with dexamethasone as the third line or beyond treatment in patients with relapsed and refractory multiple myeloma. The enrollment of this trial has been completed. We are on track to submit NDA in the second half of this year.

The second-line treatment in combination with the lenalidomide for multiple myeloma is also on track and is currently enrolling patients. Full patient enrollment with a number of 291 is expected to complete in the third quarter of this year.

Second compound for NDA is our eftansomatropin alfa, or we call TJ101. The first patient in our Phase III registrational trial in China was dosed in February. Originally, this compound was developed by Genexine, our Korean partner. We own the Greater China rights, and we believe this treatment has significant clinical advantages such as less frequent dosing, better safety profile potential for long-term use in this young population.

Pediatric growth hormone deficiency represents a substantial unmet needs in China. We are working closely with the Center for Drug Evaluation under NMPA with the goal to accelerate our trial and registration given the nature of the pediatric study. The primary clinical data are expected to be available in the second half of 2023 to support our planned NDA submission.

Now another compound, TJ107. It's our first long-acting recombinant hormone growth human interleukin-7. The current clinical development plan is to evaluate the therapeutic role as a monotherapy for cancer patients with lymphopenia and as a combination therapy with PD-1 or PD-L1 antibodies for cancers.

For cancers with lymphopenia, we initiated a Phase II randomized single-blind placebo-controlled clinical trial in December 2020 in glioblastoma patients with lymphopenia. The primary outcome study is the percentage of patients with an increase in the absolute lymphocyte count and associated clinical response in relation to the treatment with TJ107.

For our combination therapy with PD-1 or PD-L1 patients, we plan to submit IND in China in the second half of 2021 to initiate a Phase II clinical trial by a basket trial design, in which TJ107 is combined with the PD-1 antibody for treatment of selected tumor types, including TNBC. The outcome of this study is expected to facilitate the development path of TJ107 towards a pivotal clinical trial.

Finally, I will briefly discuss a few of our other clinical assets. First, plonmarlimab or TJM2, we are currently conducting a Phase II clinical trial for the treatment of cytokine releasing syndrome associated with severe and critically ill COVID-19 patients since last April in U.S. The clinical trial has progressed to the second part, aiming to evaluate the efficacy, safety and cytokine levels following a single dose of plonmarlimab at 6 milligrams per kilo or placebo, which here means the best supporting care in patients with severe COVID-19. An interim analysis is planned in the second half of this year.

At the same time, we have also initiated a Phase Ib clinical study in patients with rheumatoid arthritis in China. In this multi-center, double-blind, placebo-controlled study about 63 patients will be involved and receive a single dose or multiple doses of treatment for up to 8 weeks. The single dose escalation portion of the study is expected to be completed by the second half of 2021.

Now another compound, olamkicept, or TJ301. For this compound, we have concluded our Phase II clinical trial in ulcerative colitis in Greater China and South Korea, and we are now in the final stages of data analysis. To advance the development and maximize the potential value of this novel and differentiated molecule, we will continue to partner with Ferring. We plan to develop this compound in other inflammatory indications in which olamkicept plays a role.

Our newest monoclonal antibody to enter clinical is TJ210 directed against complement factors C5a receptor 1, abbreviated as C5aR1. A Phase I clinical trial is ongoing with patient enrollment in U.S. We evaluated the safety, tolerability and PK/PD profile in cancer patients. This program is expected to further evolve into a combination trial with the PD-1 antibody in selected cancer types.

In addition, with the IND approval in China in February 2021, we also expect to initiate a Phase Ib clinical trial in the second half of 2021 in China. The result of the clinical studies in both U.S. and China will facilitate the further clinical development of this compound.

With that update, I'd like to introduce you to Mr. Yifei Zhu, our Chief Commercial Officer, who will discuss our commercialization progress. Yifei, please.

Yes. Thank you. So it is my pleasure to join everyone today. And since coming on board with I-Mab in August last year, so my sole focus has been preparing the company for our exciting initial series of product in the launch phase. Today, I would like to walk you through our commercial strategy, initiatives and progress to date.

Our commercialization strategy is designed to build a leading hematologic oncology franchise in China through I-Mab's unique product portfolio, which include TJ202 for multiple myeloma and TJC4 for various leukemia indications and a late-stage asset to be in-licensed to cover lymphoma indications.

This combination of these 3 key products, owned by I-Mab is unique and highly competitive in China and enables a near complete coverage of major disease indications within the hematological therapeutic areas in China. More importantly, with this unique portfolio, we are well positioned to achieve a near-cure therapeutic goal through a combination of our key products and with other marquee products.

In the meantime, we are taking concrete steps to build an effective commercial organization encompassing market access, medical marketing, supply chain and the sales teams. The initial effort of the sales organization is to focus on the launch of TJ202, our first hematologic oncology product. By taking the top and academic centers and hospital networks across China, where the target patient population accounting for majority of the national cases is concentrated.

With that update, I will now turn the call back over to Jielun, who will discuss our financial results.

Thank you, Yifei. Now let me turn to the review of our financial results for the year ended December 31, 2020. As of December 31, 2020, we had cash, cash equivalents, restricted cash and short-term investments totaling RMB 4.8 billion or USD 734.1 million compared with RMB 1.2 billion as of December 31, 2019, representing a 3x increase. The current cash on hand we have is sufficient to fund our operations through the year 2023, including data readouts on core clinical assets such as lemzoparlimab and uliledlimab and also commercialization in China of our pre-NDA assets felzartamab and efineptakin alfa.

Now let me turn to the P&L side of things. Total net revenues for the full year 2020 were RMB 1.543 billion or USD 236.4 million compared with RMB 30 million for the full year of 2019, representing a more than 50x increase year-on-year. The revenues generated for the full year of 2020 solely consisted of the revenue recognized in connection of the strategic partnership we signed with AbbVie last year.

R&D expenses for the full year of 2020 were RMB 984.7 million or USD 150.9 million compared with RMB 840.4 million for the full year of 2019. This was primarily due to the increase in employee benefit expenses, which consist of share-based compensation and payroll expenses to support expansion of R&D programs.

Administrative expenses for the full year of 2020 were RMB 402.4 million or USD 61.7 million compared with RMB 654.6 million for the full year of 2019. The slight decrease was primarily due to the reduced share-based compensation expenses of RMB 305.7 million or USD 46.9 million.

For the full year of 2020, I'm very pleased to report that for the first time in our corporate history, we had made a net profit. Our net income for the full year 2020 on a GAAP basis was RMB 470.9 million or USD 72.2 million compared with a loss of RMB 1.452 billion for the full year of 2019. Non-GAAP adjusted net income, which excludes share-based compensation expenses, was RMB 997.1 million or USD 152.8 million for the full year of 2020 compared with a non-GAAP adjusted net loss of RMB 936.7 million for the full year of 2019.

Net income per ADS for the full year of 2020 was RMB 8.07 or $1.24 per ADS compared with a net loss per ADS of RMB 462.74 for the full year of 2019. Non-GAAP adjusted net income per ADS for the full year of 2020 was RMB 17.09 or $2.62 per ADS compared with a non-GAAP adjusted net loss per ADS of RMB 302.20 for the full year of 2019.

To support our rapid growth, we are actively monitoring market conditions and considering potential options for further equity listings on Greater China stock exchanges, such as the stock market in Shanghai, and the Main Board of the Hong Kong Stock Exchange under Chapter 18A of the Hong Kong Listing Rules.

Now with that, we would now like to turn the call back over to the operator and begin to take your questions. Operator?

(Operator Instructions) We have the first question coming from the line of Louise Chen from Cantor.

Congratulations on all the progress this quarter. So first question I have for you is there's a lot of investor interest in your antibody program. I'm curious how you plan to build a differentiated franchise here?

And then second question I had for you was 1 of your competitors announced a positive GM-CSF readout for COVID treatment. I see that you still have this in your development and are looking at interim analysis. What do you think about this program right now? Do you think it's too late? Or do you still think there's an opportunity for COVID treatment in the U.S. and globally?

And the last question I had for you was that you have a very impressive list of data readouts in 2021 and beyond. What are, say, the 2 or 3 most important readouts in your mind for the company going forward?

Thank you, Louise. Let me first ask Joan to talk about our TJM2 related to COVID-19.

Thank you for the questions. Absolutely, we paid attention to this competitive landscape including managing TJM2 asset, plonmarlimab. They have claims of positive results for the similar treatment as we have shown. So currently, for us, we are still conducting the Phase II clinical trial to evaluate the patients with the similar disease status. I have to admitted we had delays in the -- slow down in the recruitment because of the vaccine availability and other treatment options. However, at this time, we have more than 1 patient -- 100 patients available, which is an adequate number for interim analysis as we originally planned.

So we will have a planned interim analysis next month around. And so overall, it's second quarter of this year, by then, we will look at the potential for advancing this program, including the potential for achieving EUA and commercial partners if it reads out as promising as we have observed for Humanigen's compound.

So on the other hand, we are also very positive considering the proven mechanism of action or -- and also our compound features in comparing with other companies GSK and Humanigen. So altogether, we are very positive in terms of the continuing development path for this compound.

Louise, I can address your third question. We have a series of critical clinical milestones to deliver this year as we just discussed. But I'd like to mention 4 of them because they're really critical in our minds. The first one is NDA submission for our CD38 monoclonal antibody that will occur in the second half of this year. And this is a really important milestone to achieve because it is going to signify the company is moving into a commercial stage.

And the second one, I want to mention is a milestone for uliledlimab, our CD73 monoclonal antibody. In June, we will disclose -- we will present all the detailed clinical data from our Phase I clinical trial. And I must say, this Phase I clinical trial has shown really good safety of uliledlimab and expected PK/PD. Above all, we have seen a favorable clinical activity of this antibody in solid tumor. And we will present detailed data, as I mentioned earlier, at the next ASCO meeting in June.

And then the third milestone I'd like to mention is the -- for lemzoparlimab, our CD47 antibody, we are currently running -- expanding a ongoing clinical trial in patients with solid tumor in the U.S. By the end of this year or the fourth quarter of this year, we'll be in a position to disclose the clinical data related to safety and efficacy of lemzoparlimab in patients with solid tumor.

And the fourth clinical milestone, which I think is also critical is related to lemzoparlimab for non-Hodgkin's lymphoma. Now we are running -- we're in the process of running 2 -- running an international clinical trial involving clinical sites both in U.S. and China in patients with non-Hodgkin's lymphoma. And this is a combination clinical trial of lemzoparlimab with rituximab for non-Hodgkin's lymphoma. And we expect to have data readout by the fourth quarter of this year.

Now these 2 critical milestones are so important because lemzoparlimab combination trial in non-Hodgkin's lymphoma may lead to a registrational trial in China. And this is going to help us to secure our position, our ambition to register our CD47 antibody as a first CD47 antibody in China. And this is our ambition to move forward very quickly with lemzoparlimab in multiple clinical trials, in MDS, AML and non-Hodgkin's lymphoma.

So those are the -- I would say, those are the 4 most critical clinical milestones among others. And then your first question, could you repeat?

Yes. Investors have been quite interested in your antibody program, and I know you have quite a few compounds here and heading into the clinic. So just curious, how you plan to differentiate your franchise from others that are in development?

You're talking about our antibodies in clinical developments or?

Yes, the bi-specific antibodies, I'm sorry.

Okay. All right. So yes. So this year, we have 3 new antibodies that have entered into clinical development in the U.S. The first one is TJ210. This is a novel monoclonal antibody directed at the C5a receptor through a novel mechanism, antitumor mechanism. We're very excited about this novel antibody. And based on all the preclinical data, we're moving this molecule into a Phase I clinical trial in the U.S. and the trial just started in the past 2 months or so, it's ongoing. And we also have a plan to initiate another clinical trial, new trial, in China.

And the second antibody is our bi-specific antibody. It's a highly differentiated bi-specific antibody called TJ-L14B. This is a bi-specific antibody with PD-L1 and 4-1BB. It works to maximize T-cell activation at the tumor site through PD-L1 and 4-1BB, as you know, both antibodies costimulatory molecules to activate T cells within the tumor.

And the other advantage of this bi-specific antibody is that the 4-1BB arm of the bi-specific antibody is upon conditional activation, meaning, the 4-1BB part of the bispecific antibody is not active in the system until it reaches the tumor site. So it works through a local activation of 4-1BB. Therefore, it will avoid systemic exposure and liver toxicity commonly seen with other 4-1BB antibodies used alone. So we think our bi-specific antibody is highly differentiated because the 4-1BB part is through -- works through a conditioner activation.

Now the third antibody also -- from that, we also received -- just received FDA approval to get into a clinical Phase I clinical trial in the U.S. It's a novel bi-specific antibody called TJ-CD4B with Claudin 18.2 and conditional activation of 4-1BB. So it's designed to treat cancers expressing high levels of Claudin 18.2, such as gastric cancer, pancreatic cancer.

This is a very novel molecule. And we -- in the past few years, we have generated a very extensive preclinical data supporting its novelty and antitumor activity. Again, this molecule has a 4-1BB arm that is -- that only works at the local site to avoid systemic exposure and liver toxicity.

And just last week, we received IND approval from the U.S. FDA. We are preparing to enter Phase I clinical trial in the U.S. So those are the 3 new antibodies, monoclonal antibody and 2 bi-specific antibodies that have entered the clinical development stage in the U.S. this year.

We have the next question. This is coming from the line of Joe Catanzaro from Piper Sandler.

Congrats on all the nice progress here. Just 2 for me. I'm wondering if you can provide a little bit more detail on the tumor types that will be included in that lemzoparlimab China basket study and how that's informed by your early clinical data, translational data, competitor data as well as the prevalence of tumor type within Greater China?

And then my second question is, if you could just help set expectations for the upcoming R&D day you guys are hosting in April and whether we could see any new clinical data there? And if so, from what program?

Thank you for the question. I can take the first question. Now we are taking 3 parallel approaches to identify or to select solid tumor types that may have the highest probability of success. The first approach is really to rely on our translational medicine study, looking at CD47 expression at a different tumor types. And through the study, we have seen a range of CD47 expression in different tumors. For example, lung cancer, ovarian cancer, head and neck cancer have a very high expression of CD47 while other tumor types have a relatively low expression. So this is important to guide us as to what tumor types we want to select to start with for a better chance of success.

And the second approach is really based on our ongoing clinical trial in the U.S. in patients with solid tumor with lemzoparlimab in combination with KEYTRUDA. We are expanding the patient population and getting more data in terms of clinical efficacy signal. And based on increasing data, that will also give us an opportunity to see what tumor types are more susceptible to lemzoparlimab in combination with KEYTRUDA.

And then the third approach is really to closely monitoring other companies -- what other companies are doing and their reports about their trials for clinical activity in CD47. Now in a nutshell, for our expanded clinical trial, so in China, in the second half of this year, we will start a Phase II clinical trial in patients with solid tumor with lemzoparlimab in combination with PD-1 antibody. And to make a long story short, we selected lung cancer, ovarian cancer and the head and neck cancer for this clinical trial. And this trial is by a basket design. The outcome of the trial may potentially lead to a registrational clinical trial in China. And we're looking forward to getting the trial started in China.

Now for your second question, the R&D day, perhaps I will ask Joan to comment. We are in the process of organizing the R&D Day and structure the material we're going to talk about. I'd like to ask Joan to elaborate on our plan for our R&D Day.

Okay. Thank you for your interest in R&D Day. In terms of the arrangement, we have 2 sessions, one the China session, which will be more focusing on our hematologic indications landscape. And we will invite our KOLs, really top-tier KOLs, to give the presentation overall landscape and patient needs.

Our management will present in much more in depth the process -- the progress of our clinical trials, not necessarily the new data, top line results, but we will just provide more details of our clinical program and our strategies as well as the time lines of releasing the data.

In terms of the U.S. one, which will be in April 26, it's the virtual in combination with our live sessions. Again, that one will be more focusing on the immuno-oncology landscape globally to really help us to facilitate the discussion in terms of our clinical programs as well as the overall landscape in U.S.. And also, it will be composed of the KOL presentation from a prestigious academic institute as well as our management team for a detailed presentation of the plan, especially particularly the data readout of these years.

The next question comes from the line of Kelly Shi from Jefferies.

Congrats on the great progress on all fronts. For uliledlimab, could you provide more details about readout at ASCO, regarding the patient number and also the split between monotherapy and atezo combo cohort? That's the first one.

And my second one is regarding the CD47 antibody. I'm wondering that since you have chosen non-small cell lung cancer, ovarian cancer and the head and neck cancer for the China combo trial. Should I think for the CD73 antibody, are you going to choose nonoverlapping indications? Or this is not in your consideration?

Thank you, Kelly. Let me take the first question. As we announced in February this year, we completed Phase I clinical trial of uliledlimab in the U.S. The top line results from our Phase I clinical trial of uliledlimab with single-agent and in combination with atezo have shown, first of all, safety profile and an expected PK/PD profile. More importantly, we have seen favorable clinical activity of this molecule, uliledlimab in patients with solid tumor.

Now for obvious reasons, we are under embargo by ASCO. So today, we are not in a position to provide more detailed data. But for sure, we will present all the clinical data, detailed data at the next -- at a upcoming in ASCO meeting in June. And by that time, we'll be happy, and we'll be very excited to share the data with you and with others.

Now for your next question, what is the next question?

Kelly, can you repeat the second question?

Absolutely. So for the lemzoparlimab, you have chosen non-small cell lung cancer, ovarian cancer and head and neck for your China combo trial. Therefore, when you consider the next step for the CD73 antibody, are you trying to like choose like a nonoverlapping indications? Or this is not your consideration, it's more like efficacy-driven additional treatment?

Yes. Yes, thank you for the question. It's a great question. As I mentioned earlier, for lemzoparlimab, we have selected lung cancer, ovarian cancer and head and neck cancer in a basket trial is our plan to move forward for lemzoparlimab. For uliledlimab, there are also some overlap with the cancer types because for uliledlimab, lung cancer, non-small cell lung cancer is also among the cancer types we selected to move forward. So there is some overlap in terms of the indication between the 2 monoclonal antibodies, but largely, there are different indications for different antibodies.

I think we need to wrap up here, but we can take 1 more question.

The last question for today's evening is coming from the line of Zhongping Yuan from Huatai Securities.

First, congratulations on the remarkable milestones achieved, both clinically and operationally in year 2020. I have got 2 questions here. The first involves our CD38 antibody. So you introduce the potential pricing strategy for felzartamab of this approval, especially just knowing that Mr. Zhu, Yifei mentioned that he's trying to constructing a marketing team for this drug. Also, we have noticed that the pricing pressure in the national reimbursement to drive this negotiation. So do we plan to experience a very significant price cut for inclusion of TJ202 in NRDL?

And the second question is about our financial performance. I noticed that the company has recorded revenue of USD 236 million and positive net income, which is not normally seen for I-Mab. I suppose that the revenue is posted by the collaboration with AbbVie, correct? So could you further elaborate this impressive financial performance?

And third question was our recent collaborations. So could you give a very brief introduction of the masked antibody? It seems that it's very hard to identify some background information. Yes, that's all my questions.

All right. Thank you for the questions. Maybe I'll first ask Jielun to address the second question. And then while others are preparing to address your other questions. All right, Jielun.

Yes. ZhongPing, so let me address the first and second question, and I'll leave the third one to the management. So the first question you asked is about the pricing strategy for our CD38 monoclonal antibody. I would like to first start by saying that the CD38 market in China is quite stable in terms of competitive intensity. Right now, there's only 1 molecule or 1 drug that's approved by the Chinese FDA, which is daratumumab, and it's roughly a year ahead of us.

So we think the types of pricing competition you see in other areas or therapeutic areas, for example, the PD-1 or PD-L1 market in China, I don't think you will see that with CD38 in China because there aren't that many competition. And going forward, I think it will be daratumumab and us for the next few years. So I would like to start by saying that.

The second thing is in terms of pricing strategy. We are, as a local player in this market, we think we have some inherent advantages in terms of pricing flexibility. The first 1 is that our CD38 is only going to be marketed in China. So we don't have a global pricing system to protect. So China is our only market and it is our home market. So we will do everything to make sure that we have the maximum market share in China.

The second thing I would like to mention is that because we were going to be manufacture this product in China in our own Hangzhou facility, so we will enjoy better COGS position than our foreign competitor. Therefore, allowing us to negotiate better with the NRDL when it comes to that types of negotiation.

So our strategy will be to get on the NRDL as quickly as possible. But also make sure that both in terms of cost position and also the pricing flexibility, we can get on -- we can be as flexible as possible when we negotiate with the NRDL. So that's my first -- that's my answer to your first question.

The second question you asked is about our financial performance. And thank you very much for congratulating us. I think the biggest driver for our outperformance financially last year is the faster and better progress in our partnership with AbbVie. So we have received not only the upfront payment, but also the first milestone payment, and we are on our way to work with AbbVie to realize the second milestone payment.

So I think that operational -- that business reality was reflected in our revenue recognition. And therefore, you're seeing a better than -- perhaps better-than-expected net revenue and also net profit performance from our financials.

Third question, I would...

Yes. So I also like to add, it is unusual for companies like us to be profitable at this stage. I think what is important is that over the past few years, especially last year was the partnership with AbbVie, who have been building a significant revenue stream from out-licensing. And as I mentioned earlier, this licensing revenue stream will converge with sales revenue when we have the first product launched in China. So we're quite excited about this perspective, how we're going to build our revenue stream over the next few years.

Now let me address your third question. Now recently, as you have seen, we signed 2 deals with 2 separate companies. And this is part of our new initiative, new discovery initiative to work with companies with transformative platform technologies, okay.

So 1 company is Complix, as I mentioned earlier. It's a European company with a unique platform technology to generate antibodies -- specific formats of antibodies being able to get into cells. So those are self-penetrating antibodies. And we're very excited about this opportunity because through such platform on technology, we'll be able to generate a panel of novel antibodies that can penetrate into the cell to target intracellular targets that are otherwise intractable. And that really opens a lot of opportunities for us.

And the second partnership we signed is with a Shanghai-based company called Affinity. They have this unique technology to mask antibodies and only the antibody -- in the system, the masked antibody will not work because they are not active until the antibody reaches the tumor sites where the masking peptide can be cleavaged by the enzyme, specific enzymes only exists inside the tumor.

So this technology enables us to generate novel monoclonal antibodies that can only activate at the tumor site for a better efficacy and also to avoid systemic toxicity for some selected targets. So we are quite excited. We have an agreement in place to generate a series of masked antibodies for different immuno-oncology targets.

Okay. Sorry, according to your description, it seems that the masked antibody is something kind of ADC, right?

No. This is not really a ADC. So it's a technology where you can attach a masking peptides to the active sites of antibody, okay, so that antibody will not be active in the circulation, in the system. But when the antibody reaches the tumor site, the masking peptide will be cleavaged will be destroyed by specific enzyme only existing in the tumor. So the antibody then becomes active in the tumor sites.

So that technology, as I mentioned earlier, enables us to make novel antibodies to avoid potential systemic exposure of toxicity and for the antibody to reach to the tumor sites to be active to exert anti-tumor activity only at the tumor site.

Operator, we have to wrap up the call.

Ladies and gentlemen, that does conclude our conference call for today. Thank you all for your participation. You may disconnect.

All right. Thank you, everyone. Thanks for your time.

Thank you.

Thank you.

Talk to you soon. Bye-bye.