Good morning. Welcome to Everest Medicines 2026 earnings call interim. All the participants are on mute now, and we will have a Q&A session later. We have a statement before the moderator speaks up. This is from CITIC Securities whitelisted meeting. Only invited clients are allowed to attend. Without written permission of CITIC Securities and the speaker, no one shall disclose the content and relevant information of the meeting in any form. CITIC Securities reserves the right to pursue legal responsibilities in violation. To investors, welcome and good morning. Welcome to the interim earnings call of Everest Medicines 2026. I am Chen Zhu, and I see and Dr. Zou are online as well. We have this heavyweight management team attending the meeting as well, including our Chairman, Bill Wu, CEO, Rogers Luo, CFO, Ian Woo.
All of us are on this call today. We should say that for the first half of the year, we have strong growth in commercialization under IFRS. Non-IFRS, we are turning positive and we have earned a RMB 97 million raw profit and revenue grew by 157% to over 1 billion RMB. The R&D, ED commercialization have all seen great achievements. In R&D, we have already disclosed and on EVER001, we have released excellent 52-week clinical data, more raw, and we have reached under BDR license with Travere Therapeutics with a value of $1.14 billion. Then we have in vivo CAR-T, we have NovaBridge. All these pipelines are going forward as we speak. In terms of commercialization, we have integrated Hasten Biopharmaceuticals domestic marketing team, and it is going on for nephrology and autoimmune categories.
Those are the strong suit of us and we are adding more categories like cardiovascular and metabolism applications. We have huge potential for commercialization going forward. We are continuing to build the platform of commercialization in China for novel drugs, and we are also going global. It is one of the few company with so many capabilities in biotech and biopharma. The overall performance for the first half of the year, that is all for me. I would now invite Ian Woo, the CFO, to introduce the details to you.
Thank you, Chen Zhu. Welcome, in vestors, for attending this earnings call for the first half of the year. Chen Zhu, thank you for your introduction and the summary. First of all, I will report on the financial performance of the company, and followed by Mr. Rogers Luo to introduce the operation summary, including commercialization and R&D progresses. Finally, we will have Bill Wu, the Chairman, to introduce the strategic progress of the company. Eventually, we will have a Q&A session. Management team will be here to answer the questions from our investors. First half of the year, the full revenue reached RMB 1.15 billion, growing by 157% year-on-year. It benefited from NEFECON for the second year in an NRDL, maintaining a fast growth rate. For the first half of the year, XERAVA in-market sales also achieved great growth.
Unfortunately, we had some tight supply issue for overseas CDMO, which has some impact on channel and sales. Accumulated loss of the shipment value is about RMB 150 million. It means the revenue should be more than 1.3 billion. The gross margin after eliminating intangible asset amortization is 73.7% under IFRS. Net profit is a minor loss of 5.94 million, reducing by 244 million over that same period last year. Under non-IFRS adjustment, we excluded the salary expenses based on shares, intangible asset impairment, and intangible asset amortization. Net profit actually reached RMB 97.23 million. Regular operating profit reached RMB 48.12 million. Between these two numbers, there is an adjustment because we have eliminated the fair value adjustment for MidCap's investment and also our subsidiary, NovaBridge Biopharma's loss attributable to us.
The RMB 48.12 million of operating profit reflects the real performance of the company. This number shows us that our company is entering a phase where we are turning loss into profit. End of June this year, cash balance is RMB 1.836 billion. In July, we have received the EVER001 out licensed down payment, which is RMB 770 million, so we have a solid cash reserve. Now let's look at the three expenses, sales, R&D, and general and administrative expenses. For the first half of the year, we expanded the sales team for NEFECON and VELSIPITY. We are also building capability for commercial platform. Sales expenses grow to RMB 458 million. Due to the huge growth of revenue and improvement of operating efficiency, sales expense rate actually reduced to 39.86%.
R&D is similar. It's gone up from RMB 95 million to RMB 256 million this year. But the ratio actually reduced from 44% to 22.31%. SG&A grown up from RMB 111 million to RMB 149 million this year, but the ratio reduced from 24.84% to 12.95%. Overall, we are optimizing the expense structure. The ratio of those expenses have improved by a lot. This is the complete profit and loss statements for the first half of the year. While we are achieving rapid growth in revenue, we have improved our operating efficiency. Non-IFRS net profit is now turning positive. Cash balance is abundant, and we have shown the numbers already.
Now I'd like to invite CEO Rogers Luo to introduce the latest updates of the operation.
Thank you. Like we said earlier, for commercialization, NEFECON is maintaining a great momentum, reaching almost RMB 900 million sales, growing by 94%. Last year, that is the first year for an NRDL inclusion. This first half of the year, we are maintaining great momentum. The XERAVA for infection, we can see there's a strong demand. In market, growth is 28% for the first half of the year. Like I said before, we had some supply chain challenges. We had a tight supply for over a month. If we had a supply chain stable, I believe there is another sales, which is about RMB 150 million. But we have a plan for production capacity and which is ongoing according to the plan. The other one is VELSIPITY, approved this February, and it now is commercially available on the market.
We also started localization for manufacturing, and we have completed the technology transfer. VELSIPITY is a big novel drug, and we will talk about that later. For the first half of the year, we also applied for PCSK9 drug, LEROCHOL/lerodalcibep. For R&D, we have EVER001 going global for nephrology, a very important product for nephrology. EVER001 BD Ops is going to be a milestone event for Everest Medicines, and we reached a $1.14 billion out license. We are working with a partner, Travere Therapeutics. We are planning to talk to U.S. FDA, hoping to enter clinical phase III directly. In China, we have started basket trial already, including indications FSGS, MCD. Aside from PMN, those are indications without treatment in China. We have enrolled patients already. The other one is VIS-101, which is for ophthalmology.
We have started the phase II-B clinical trial. For our own R&D, aside from our individualized vaccine we reported earlier, we have EVM16, and we had phase I-A clinical trial readout, and which is reported on AACR meeting in this April. We are hoping to release the data as soon as possible. The other one is EVM14. It is a general cancer vaccine, and we have enrolled patients in both China and the U.S. We also have developed an immuno-related vaccine called EVM15. Now we are doing preclinical studies. For in vivo CAR-Ts, we have EVM18, and which is currently in phase I. That is for R&D. For BD Corporation, like we said earlier, we have, BD out. For licensing, we have MT-1013 for Micot, and we have Bejescin.
We also have licensed in DMX-200 to enrich our nephropathy leadership. In the meantime, for cardiovascular indications, we have licensed in CARDAMYST, Vicagrel, which is an antiplatelet drug to treat ACS. We have some CSO pipelines together with innovative drugs, so we can expand our cardiovascular field. For ophthalmology, we have also licensed in this, an eye drop for presbyopia. Aside from that, we are going global. We have acquired Hasten Biopharmaceuticals Asia Pacific Business. It is going to be a solid innovative drug commercial platform going forward for Asia Pacific. Now I am going to go deep diving onto the drugs. We talked about NEFECON. First half of the year, the revenue has been really a highlight. Year-on-year growth reached 194%.
We have a few arrangements and because we have now more accumulated real-world evidence, this medical evidence, not only from China but also from European Union and the United States. On the conferences in Europe and U.S., we have published the papers and this is very important because it is kind of reshaping the guidance of IgA nephrology. NEFECON is the first line treatment for IgA nephropathy, and we are maintaining this position because of these studies. NEFECON is not just a treatment drug, but also we have seen that if treated earlier and longer, after nine months, patient can benefit long-term, which is a great opportunity and foundation for long-term growth of NEFECON. We have also reached agreement with Hainan Herui and we are starting prescription in many places in China.
For sales, part of the growth is coming from the strong demand, but also we are expanding the marketing team, sales team, from 200 to 300 people. The hospitals' network coverage reached 2,500 and we believe the second half of the year and next year, we will maintain the continued momentum of growth for NEFECON. We talked about VELSIPITY already. This March, it went public, went to market. VELSIPITY is a preferential treatment for ulcerative colitis. There are two things going on which are very important. First is to build our sales team. Secondly, we are working on many evidence-based studies. In September, we will attend the NRDL negotiation. The positioning of VELSIPITY is not only for ulcerative colitis with high healing effect on mucus.
It is orally taken, much easier than traditional antibody on the market, which has to be injected. We have high healing effect for the mucus, and we expect to get into NRDL very soon. If we can be successful with NRDL, next year is going to be a huge growth point for us. We are starting localization manufacturing. Technology transfer has completed. We believe by the end of 2027 or 2028, we can have local supply of VELSIPITY, which will reduce the cost of production. We also mentioned earlier about XERAVA. Clinical demand is strong. In hospital grew by 28%. Again, we had some CDMO tight supply issues, so for almost two months, we could not get the product. We had zero inventory for that period of time.
We believe if we had a better supply chain, the first half of the year should have another sales of CNY 150 million to CNY 200 million. That is why we are working on localization for manufacturing. We expect to locally produce it in 2028. XERAVA is for the treatment of various drug-resistant bacterial infections, mainly used in ICU and the respiratory departments. For CSO, we have Hasten Pharma. With other drugs, we have very good synergy, and that is the CSO synergy we have achieved this first half of the year. In future, we will continue to focus on these areas. Another project this year is that we are going to attend National Medical Insurance program this year. If we are successful, XERAVA next year will also see huge growth potential.
The previous generation of tigecycline has huge volume in China, close to 10 million. Now it is out-of-pocket payment, so the demand is not high yet, but we expect to see huge growth next year. In March, we had a CSO partnership with Hasten Pharma. The service revenue is CNY 145 million. You can see the number of the profit. We are actually improving the synergy, improving the sales efficiency. Firstly, we are integrating the resources, including compliance and academic operations, and we are also expanding the hospital network from 10,000 to 15,000 hospitals. That is going to help us to scale up for XERAVA next year once we are approved for NRDL. CSO is not only for anti-infection and Rocephin, but also for cardiovascular. Because we are entering cardiovascular and metabolism area.
CARDAMYST, we expect that maybe by the end of the year, we will get approval. CARDAMYST is for cardiovascular indication, and Hasten product include pidopabacin. Those are also in synergy with CARDAMYST. We have introduced PCSK9, LEROCHOL/ lerodalcibep . These are the two products for cardiovascular as well. The CSO service with Hasten Pharma are actually reinforcing our strategy in these two areas. Looking into 2028, you can see the Everest Medicines innovative drug. We have a strategy called a 3 plus 3 plus 1. The first three means we expect to have three products listed in NRDL, including NEFECON, XERAVA, and CARDAMYST. The other three means in 2027, we will expect to have two new drugs including this eye drop for presbyopia and the LNZ100.
The other one is that we have a Gd-IgA1 detection reagent for IgA patients. It is for their diagnosis and for their long-term follow-up. It is our reagent. In 2028, we will have nephropathy drug of MT-1013 going public, going to the market to further enrich our portfolio. We have an objective that every year we should have two or three new innovative drugs in the pipeline to continue to enrich our commercialization pipeline and to generate cash flow. Now, I would like to introduce that in Q3 this year, we expect to get approval for CARDAMYST. The feature of this CARDAMYST, firstly, it is the only drug approved by FDA for the past 30 years for PSVT, paroxysmal supraventricular tachycardia. For PSVT patient, the heart rate can be very high.
It is agony feeling with severe symptoms. They need to be treated in the emergency room. CARDAMYST changes the treatment paradigm. While in the past, you have to go to the ER for treatment, now the patient can do their self-help, self-treatment. It is a nasal spray, so the patient can administer the drug by themselves in the nose. In five minutes, it is going to kick in. In 17 minutes, the median cardioversion. 17 minutes is the median recovery time. 60% of the patients or above could achieve cardioversion. That means the disappearance of the symptoms. Again, it changes the treatment pathway. We believe it is a huge opportunity. For PSVT indication, once it is approved this year, we are working with our partner now. We are developing new indications, which is AFib RVR.
AFib incidence is very high compared with PSVT. AFib patients could be 100% more than the PSVT patients, that means huge potential going forward. Now we are working with partner to get phase III clinical trials globally, and China is part of that. In future, it will also be approved for China market, and it is a huge growth potential for us. Next one is the LNZ100. LNZ100 is a consumer type of presbyopia eye drop. In the morning, you only get one drop, so it will maintain a good result for 10 hours and improves the two line of vision. By the end of 10 hours, 70% of the patient or 60-plus percent of patients can improve the vision by two lines or above.
It not only improves the presbyopia patient, it also helps the older people to engage more socially. It is a heavyweight drug in the future. We expect to be approved next year. MT-1013 has been introduced earlier. It is a first-in-class bispecific drug for SHPT. It is redefining the SHPT treatment paradigm with huge market potential. The significance of this drug is that not only it is highly effective in therapy, it is actually helping us to expand our product pipeline from primary glomerulonephritis to chronic kidney disease. Glomerulonephritis patient in China is 10 million, but chronic kidney disease patient is close to 100 million. That is a new field for us. EVER001 is also significant. First of all, we are developing more indications. It is a pipeline with multiple indications with very good PMN data.
A basket trial has started in China. We have enrolled patients for FSGS. So far, there is no treatment for FSGS. Then you have PMN, MCD. These are the new indications. We are working with our partner, Travere, based on their development capabilities. Now we are working with them to talk to FDA to get into phase III clinical trial directly. That is working very well. The nephrology treatment is improving, and they have the capability to bring it into phase III clinical trial. DMX-200 is for FSGS. It is a CCR2 inhibitor. We are doing some licensing. FSGS globally, there is only one drug approved. There is no drug approved in China. Another big potential for us. Looking at the phase II readout, and we have seen good readouts.
Global phase III trial is ongoing, and we expect to be approved in China. That is going to be a groundbreaking drug for FSGS in China, further consolidating our leadership in nephrology. For nephrology, we have glomerulonephritis treatment, NEFECON. We have other primary glomerulonephritis. For PMN, FSGS, and MCD, we have new treatment indications. We have DMX-200 for FSGS. We have licensed the Bejescin as a brand-new antibody. We are also expanding into complement inhibitor and B-cell inhibitors to further enhance our position of leadership in primary glomerulonephritis. For chronic kidney disease, which is a bigger patient audience, it is more than 100 million. We have MT-1013 already. We are evaluating new opportunities for licensing like ETA and CKD comorbidity complication management. We are trying to introduce new products to consolidate further our leadership in nephropathy.
Next, let us touch upon R&D. We are a globally leading mRNA platform. We have end-to-end capability from antigen design algorithm. We have iterated this MiaoShuan system 4 times, and we have ALNT target technology and ADC technology. We have the IP ourselves as a platform. From this platform, we have developed two types of treatments. One is vaccine treatment, the other one is mRNA CAR T treatment. We have individualized vaccine and the pathway vaccine and immuno regulation types, EVM16, EVM15, EVM14. EVM is still in preclinical phase. The other ones are all in clinical phases. The other one is ImmunoCAR T, EVM18. We are working on R&D application globally. For autoimmune indication, we have developed another bi-target ImmunoCAR T, EVM20.
EVM20 is a double target ImmunoCAR T, which can deeply clear B cells, which can be used for autoimmune and hematological tumors in future. Now it is in a PCC stage. EVM18 is in human test now. We have reported many times before on the data. IT is in progress. Double target CBM. We expect to finish PCC by the end of the year. Next year, we can apply for clinical trial at appropriate time. EVM14. We got R&D from both China and the U.S. We are starting the clinical trial, enrolled patients for both China and the U.S. This is for relapse squamous, non-small cell lung cancer and head neck squamous cancer as well, which is a huge demand as well. EVM16 is individualized treatment plan. IGME-1A clinical trial has readouts, and the immunogenicity is great, with great response.
For EVA trial, we have very good clinical effect. Some patient have seen partial remission with SD, stable disease. We are applying for R&D with FDA and Center for Drug Evaluation by the first half of next year. That is our overall R&D strategy and commercialization strategy. We have been building the capability for the past two years. We have a great A2MS platform trying to achieve the best outcome with the most efficient investment. Now on this platform, we have a success of NEFECON, success of XERAVA, and going forward, we will focus on VELSIPITY. As a CSO, we will introduce some classic drugs and brands. That means we will have full lifecycle capability, and this capability can be easily replicated and evolved, to propel our future new products and enable the team for long-term and stable sales growth.
Now I would like to invite Bill Wu to introduce the corporate strategy.
T hank you, Rogers. A base update of the strategy. Rogers talked about A2MS platform, which is our core competitiveness. Going forward, we will continue to enhance our A2MS platform. Secondly, we are upgrading and escalating A2MS. We are covering the full lifecycle of the product and all the channels. The A2MS model will also be replicated to overseas market. For BD, we are insisting on our plan from the beginning of the year. Every year, we introduce three to five heavyweight products. That means peak sales of over CNY 2 billion each. In two, three years' time, we are trying to put them to the market and reaching peak sales in five, six years from introduction. Currently, we see that we have achieved those objectives.
After a year of effort, aside from BD pipeline, which is being enriched. In the pipeline, we have almost 20 projects by the end of the year. It is going to be more than 20 by the end of the year. We expect that in China and outside of China, we are going to have 20 pipelines each. Aside from the product already on market in China, we have five to six projects in phase III clinical trial stage. Two or three new product will go to market. For BD strategies, we have license in and license out at the same time. We have early-stage BD and commercialized BD. These are going hand by hand. The chart on the left, we have two positive feedbacks. We have introduced the study R&D and introduced the study.
Once we have cash generated, we can support R&D investments. We call it EVER001 model. The right-hand side is the NEFECON model. We introduce commercialized pipeline with high quality, so we can upgrade our commercialization capability, which generates sales returns. With higher capability of sales and cash flow, we can continue to enhance the next round of BD assets. That is the two-way BD, early BD and commercial BD for two positive feedbacks. For overseas operations, one is in the Western world, the more developed markets. We have 16% of stake at NovaBridge. We have synergy with them for commercialization and development. NovaBridge is responsible for Europe and the U.S. Everest is focusing on the resources from China. We have data, we have cost benefits, so we can enable, empower NovaBridge global strategy.
We are responsible for China and the emerging markets for commercialization. In Southeast Asia, we established a new platform for emerging markets called Everest Arc. We have 120 people in the team. The sales value is more than $80 million. We are expanding our capability for overseas self-operated commercialization. In our milestones envisioned, for the first half of the year, we have delivered a few. First is VELSIPITY, which is approved in China. The other one is EVER001 for out-license. LEROCHOL, we have submitted a BLA application. VIS-101 is entering phase II-B clinical trial. Second half of the year, we will have further milestones. First is CARDAMYST. In maybe August, September, it will be approved in China. VELSIPITY and XERAVA, we are hoping to get some success with the negotiation with NRDL.
MT-1013, we will complete the clinical trial. We will apply for application first half toward the next year. Then we have the EVM18, submitting FDA IND. These are the milestones going forward. The strategy 2030, again, we aim to achieve a revenue of CNY 15 billion to become Everest Medicines 3.0. We will become a leading comprehensive pharma technology company in Asia. We have N+S, N+X portfolio. We have three capabilities, R&D, BD, and the strategic corporation. So one step above time, we will deliver our milestone according to the plan to reach our goal. Well, that's pretty much for the presentation. Thank you.
Thank you, Bill, and thank you for all the managers. I'm Zou Zongyin from CITIC Securities. It's time for Q&A. I'd like to start first. We've seen that you have created a great pipeline. You're making progress with the N+X strategy. What is the BD plan for the second half of the year? You said that you all have synergy with NovaBridge. What are the new focuses going forward in the second half of the year?
For BD, we will continue to have two-way BD. For OPT, on top of the mRNA platform, we will continue to consolidate our capability through global partnership. We hope to get some success as soon as possible. We will continue to work with NovaBridge through strategic synergy for licensing and then for indications. We are talking about cardiovascular, metabolism, nephrology, ophthalmology, autoimmune, immunotherapy. These are the most of the growth opportunities. For the second half of the year, for phase III or beyond stages, we will have one or two deals in the second half of the year. For the earliest R&D project, we will have one or two deals as well. Thirdly, we are enriching our portfolio in Southeast Asia.
So in the second half of the year, we will have one or two BD deals as well. That's basically the plan for the year.
Thank you, Bill.
We're looking forward to bigger deals going forward. Now from Guosheng Securities, you can ask questions.
Thank you. I'm from Guosheng Securities . My name is Hui Yao . As a researcher for commercialization, this year, looking at your portfolio, we are enriching the coverage of departments and you are enriching the pipeline echelon. The structure is more of higher scale now. The first half of the year, based on your commercialization achievements and then going forward, every year, you will have two or three new products approved, and then you are going to get an NRDL coverage for China. Maybe you can tell us the commercialization outlook for the year and for next year in China.
Thank you, Hui Y ao. For the first half of the year, NEFECON maintained a great momentum of growth for IgA nephropathy patient. It's a huge potential because it's more than 1 million patients. Every year, there are newly diagnosed patients of 100,000 for kidney patients. NEFECON penetration, I think there's a huge potential for us to penetrate into the new patients, let alone the IgA patients, where the protein urea is between 0.5 to 1 gram. That's the patients that need to be treated. So IgA patient need to be treated, NEFECON is for them as a first-line treatment cornerstone regimen. So we believe the huge potential is still there for NEFECON. We know there are bio agent being approved.
I think they're approaching to be approved, but still in this field, it's very hard to shake the position of NEFECON. For the severe patients with proteinuria over 3 gram, there is still room for combination treatment. In critical guideline guidance, there is a clear statement. Aside from NEFECON, we have CSO service as also another potential for growth, for synergy, for critical disease, cardiovascular field. Next year, there will be an NRDL negotiation. If we can include XERAVA and VELSIPITY into NRDL, next year is going to be a year of scaling up. In UC field, in ulcerative colitis, the patients being treated, there are already 450,000 of them, and potential patients can be another 800,000. Bio agent is treating 100,000 of them, so many of the patients are not treated. VELSIPITY is orally taken.
It is very effective, very convenient for the patients, so we believe we can enter both 5-ASA patient group. Aside from these two product getting onto an NRDL, by the end of the year, we expect the CARDAMYST, like I said earlier, CARDAMYST is consumer-grade product with huge growth potential and huge demand. There are new product to be approved. Next year, we will see huge potential. We have acquired Hasten Biopharmaceuticals Asia Pacific business, which will continue to grow steadily. The revenue scale of the company will continue to expand to become a company with huge revenue scale. In the meantime, we will continue to expand our pipeline. That is the growth momentum of the company, and that is the outlook.
Thank you, Rogers. Very clear. I wish all the best with your NRDL negotiation. That is all from me.
Next, I would like to invite from Guolian Minsheng.
I am from Guolian Minsheng, analyst Flo B. Thank you for the opportunity. As you mentioned, in CAR T, you have some products. Maybe you can update ImmunoCAR T. What is the cadence and the milestone for the readouts? You have gene IAT. There are disclosed risk events for ImmunoCAR T. Is that going to affect your subsequent experiment progress?
For the gene treatment risk events, I think it is not related to us, to my knowledge. It is an AAV lentivirus mechanism, not our mechanism. Our ImmunoCAR T EVM, we have completed preclinical steps. We are applying for IND with FDA. Human IND is initiated. Now it is for autoimmune indication. The other one is the double target EVM20. B cell and plasma cell are both the targets. It can deeply induce the remission and reconstruct the autoimmune system for oncology indications. We expect to complete PCC by the end of the year. That is the update. Thank you.
Thank you for the updates. That is all for me.
I would like to now invite from Changjiang.
Morning. I am from Changjiang Securities. My name is Changhong Liu . Thank you for this opportunity. I am happy and thrilled to see that Everest Medicines has very good highlights in this interim result. My question is on oncology vaccine, tumor vaccine. What is the clinical progress update for tumor vaccine? What is going to be the future cadence readouts, for instance?
As we said earlier, we have three vaccines. Two are in clinical trial. One is an EVM16 individualized vaccine. On AACR, April meeting, we have announced, published the result, and in the hospital it has IAT. The complete data set will be published on important international conferences. Now we are working on phase I-B trial. By the fourth quarter, I think we will have our non-small cell lung cancer maintenance treatment. The first patient will be enrolled by the end of the year, and so it is an expanded indication cohort exploration. By the end of the year, we will submit IND to FDA, hoping to get approval next year. That is individualized tumor cancer. The other one is general vaccine, EVM14. U.S. and China are both in clinical phase I, single-dose escalation.
Monotherapy dose escalation is in the first half of the year to determine the dose. IAT combination drug, we expect by the end of the year, we will enroll the first patient. Second half of next year, we will have a dose escalation completed. That is the cadence of the trial. The other one is immuno adjust regulation tumor vaccine, which is in P4 stage, PCC stage.
Thank you for the answers. Now I would like to invite from Northeast Securities.
Thank you for giving me this opportunity. I am Si Dongpin from Northeast Securities. I want to ask for VELSIPITY going forward, what is the sales plan for VELSIPITY going forward?
Thank you for the question on VELSIPITY. Like I said earlier in March, we completed the commercialization. We have a commercial team, sales, marketing, academic. We are vigorously promoting VELSIPITY. One thing to mention is that for ulcerative colitis, the patients that are treated number is 450,000. Most of them are using 5-ASA. There is no evidence for the healing of mucus. Then 80,000 to 100,000 patients are treated with bio agents. It is very limited. Then for VELSIPITY, it is a three-in-one treatment. Efficacy, safety, and convenience are both available. So deep mucus healing effect is 51%. We do not have head-to-head study, but it is the best in class. In sense of safety compared with the bio agent, which has secondary infection issues, JAK inhibitor has black box warnings.
Convenience, it is already taken. Another update on that is that VELSIPITY indication is for moderate to severe indication. Our partner, Pfizer, expect to apply for mild to moderate UC in the upcoming September. In China, we will also do that. We expect to submit application for mild to moderate ulcerative colitis. So that is expanding from severe to mild patients. Now, this product is not only similar to bio agent for moderate to severe patient, but also for the mild to moderate patients who are currently using 5-ASA. For those patients treated on 5-ASA, there is another 300,000 patients of them, and they can use it as a first-line treatment. If that is the case, you can see the potential can be huge. Aside from HMS, we expect by the September next year, we will negotiate with NRDL.
If it is successful, it is going to give us huge growth momentum. Thirdly, for NEFECON, XERAVA had a shortage in supply. That is why we are doing local manufacturing for VELSIPITY as well. We have completed the technology transfer, so the technology is transferred from the U.S. to our factory in Jiaxing. No later than 2028, we will be able to make it locally so we can stabilize the supply chain and reduce the cost. That is the guidance. We have HMS team. We have medical insurance negotiation. We have new indications and expansion of indications. That is pretty much it aside from the local production.
Thank you. I would like to invite a colleague from Zhongtai Securities.
I am Yushan from Zhongtai Securities. We noticed that your partner, they have a highlight in the semi-annual reports. Does that help you to accelerate your overseas clinical development? B Maybe in future, what is the update on the new various indications?
For civorebrutinib, we are working with Travere Therapeutics on civorebrutinib. As you said, Travere Therapeutics in Q2, on their earnings call, they disclosed that they are going to start global phase III for membranous nephropathy. We are judging the phase III possibility for FSGS and MCD. They also disclosed that aside from membranous nephropathy, FSGS and MCD, they are considering other immunomedicated nephropathy potential. Travere Therapeutics is using this product as a pipeline in a product for multiple indications, which is also our idea at Everest Medicines. In China, we have started a phase II basket trial including FSGS and MCD patients, and IgA patients. If the profile of the product has been approved in nephropathy, we know BTK inhibitor could be used for other autoimmune indications aside from PMN.
We hope that in future, this product could help more autoimmune patients. Travere in nephropathy, they are developing the global market in registration and commercialization. Travere Therapeutics has a lot of experiences in nephropathy, so working with them together is definitely going to help us on R&D and on commercial opportunities. Like Bill Wu said earlier, one of the BD direction going forward for us is to license in early-stage products. Civorebrutinib is a license in for Filspari. We had a clinical trial to get POC data, and we have used that to accelerate the process of licensing. This is a success example, and we will continue to try to replicate this su ccess in the future at Everest Medicines.
Very clear. No more questions from me.
Next colleague is from CICC.
I am Yang Yizheng from CICC. Is NEFECON generics. We have seen some more and more generics on the market already. How do you evaluate the impact from the generics for NEFECON? What is your measures that has been taken to handle generics?
NEFECON patents are expanding. Once approved, we will new litigations to counteract with the generics, making sure they cannot go to market. Like you said, there are generics approved through BE, bioequivalence. They are going to market, but they do not have clinical data. I hope and I believe the doctors and patients will make the right decisions. Secondly, we are working with Hainan Herui to reach an agreement settlement on budesonide enteric coated capsules. We are responsible for its commercialization in mainland China. So the out-of-pocket patient are now expanded. The third one is the IgA market, which is huge. Aside from the existing 1 million patients, every year there will be another 100,000 patients. That is going to be the huge driver for long-term growth of NEFECON.
Everest Medicines currently used to have only one blockbuster, but we have a more enriched pipelines. That means we are diversifying our products, including CARDAMYST and VELSIPITY, which will be included in NRDL. We are very confident in revenue growth going forward.
V ery clear. Thank you. Next colleague is from Tianfeng Securities.
Thank you for this opportunity. I am Li Huiyao from Tianfeng Securities. You mentioned you have more pipeline for nephropathy. You have introduced a lot of post-stage nephropathy newer drugs. I would like to ask about your strategy on sales team, and is that going to change your expenses going forward?
We have new product, like VELSIPITY, CARDAMYST, eye drops. We will build our sales team ourselves because they are specialty drugs. According to our BD strategy, we will continue to introduce more and more drugs. So we have VELSIPITY for autoimmune, CARDAMYST is cardiovascular, and we have ophthalmology. For all the new areas, we will build our new team for sales. Secondly, we will control the sales expense rate. As we have introduced at the beginning by Ian Woo, the sales expense rate is relatively low. At the beginning, it was only 40%. Now we have more products and we are growing the revenue. The efficiency will continue to improve. The sales expense rates will continue to drive down from 40% to lower point, maintaining our better profit margin.
Next colleague from Founder Securities.
Thank you. I want to ask for the early stage study team, early R&D team, what is the team status? What do we expect to see for new R&D?
Getting into R&D stage next year. We have a team for mRNA platform. It's an end-to-end platform. We have a tumor vaccine from mRNA platform and immune CAR-T therapy. For mRNA, we have EVM18 in vivo CAR-T, double target EVM20 and EVM16 and 15 for tumor therapy vaccine. These are going to be the new R&D molecules. They're being advanced as we speak. Secondly, we're looking at new R&D projects. We will introduce new technology platforms to continue to expand R&D pipeline. To add a little bit, now in China, there are many bio innovative teams and companies in China. Hangzhou ecosystem has a lot of PCC projects in PCC stage or before R&D. By the end of the year, maybe you will see new target pipelines entering into our early R&D pipeline stage. Thank you.
No more question. Next, colleague from Southwest Securities.
Thank you. I'm Xiangyang Du from Southwest Securities. I want to ask about your Southeast Asia business, which is a big strategy for globalization. Thank you.
Bill, you maybe adding a few points.
We have strategic integration. In Southeast Asia, we are doing a license in also for Southeast Asia, including city training, adjusting and recovery. We are expanding our Asia Pacific team capability, and we are introducing new products through licensing based on Everest Medicines' capabilities. Araco, we have acquired them, and we're making progress in integration. The sales team is stable. Business is growing steadily. Up to now, by the end of last month, as you see, the number has shown slight growth in revenue. Araco business has been very stable.
Thank you. Next colleague is from Huafu Securities.
You hear me?
Yes.
Thank you. I'm Yang Sung from Huafu Securities. I want to ask about the revenue and profit and gross margin guidance going forward in the next two to three years. What is the growth rate? Maybe you can give us some breakdown of the pipelines, the products, and also the guidance on gross margin and net margin.
Thank you for the question. Now we are accelerating the implementation of new strategies. We're scaling up. We are introducing new products. We are seeing the improvement of synergy and the economy of scale of the commercial platform. We expect to maintain a very good growth in revenue. In the meantime, we will continue to improve efficiency operation through operating leverage, and the profit will continue to grow with the revenue growth. Many of the products are in different stage of commercialization and in the life cycle. We do not have breakdowns of the long-term growth of individual product. The long-term static objective, our objective is to maintain 70%+ gross margin with a more higher scale and portfolio optimization and the improvement of operational efficiency. We expect to have more than 30% of EBITDA profit.
Profit before interest, tax, depreciation, and amortization. In our strategy plan, we mentioned earlier, we have a 2030 plan for revenue of CNY 15 billion , and we are still about time. We will deliver the milestone. Every year we will reach a new level.
Thank you. Wish you all the best.
Thank you. Okay, I want to thank the management for the detailed explanation, and thank you for your time. Okay, that is the end of the Q&A session. We have seen that the performance of Everest has been really promising, and you are doing buybacks, and you are increasing your stakes in the company, showing your confidence in future development of Everest. Finally, Bill, maybe you can conclude by sharing the corporate strategy.
Good morning. I want to thank all for attending this earnings call this year. With the lack of shipment for XERAVA, we still reached a revenue of CNY 1.15 billion with an operating profit of CNY 48 million. We reached goal for home and abroad. We have a BD acquisition going on, but we still maintain a very healthy and strong cash margin. We have very stable asset liability level. We are working with Hasten Biopharmaceuticals. We have BD introduction. We are expanding to Southeast Asia. We are doing R&D milestone delivery, dealing with NovaBridge Biopharma generic drugs and the listing of Rocephin. The team is getting stronger and stronger, and we have 1,000 people in the sales team. A2MS platform is now complete, replicated to overseas market.
We are delivering according to our strategic plan by the beginning of the year . On the interim meeting of the company recently, we stated that we continue to build a valuable, expected, and respected company. We will see growth in revenue, profit and cash flow. We will prove ourselves as a valuable company through our R&D and pipeline. Secondly, we are a company to be expected. We have excellent commercial capability, two-way BD capability. We have organizational capability. We have enterprising culture and entrepreneurship to make sure that we have capability to deliver. Thirdly, we are a trusted company. We are a value-oriented, risk-controlled discipline for investment. We will maintain and protect our investors. Rest assured, we are a company that is trustworthy. We are upgrading to Everest 3.0. We are insisting on innovation, long-termism.
We are insisting on the fundamentals. We are steadfast, and we will continue to build, again, a valuable, expected and trusted Everest Medicines. I want to thank for supporting and trusting us.
That concludes the meeting today, and wish you all the best. Thank you. Thank you, everyone.