Thank you very much for joining us.
Thanks for having us.
To start with, this is pretty much halfway into 2024.
Yeah.
And could you tell us about, you know, what has been the key focus of Zai Lab this year, particularly looking into the second half of the year, commercially, clinically, anything we are pretty much focusing on for the rest of six to 12 months?
Yeah, it's been a very eventful year, and it's an exciting year for us. This is the first year of our growth period that we talked about. We rolled out last year at this time. We said between, I mean, the years that encompass 2024 through 2028, so that five-year period, we said we'd grow sales at a minimum compound annual growth rate of 50%. We'd achieve profitability in that period and move from having four products on the market in China to up to 15 or so. So this is the first year of that. And so what we're seeing so far is the big focus, commercially, is to launch VYVGART. Well, we had VYVGART approved for gMG last year, right about at this time.
We had commercial product in the market in September of 2023, but then had NRDL listing for VYVGART for gMG January 1st of this year. So that's, you know, the number one, I think, big event for us in 2024 is to launch VYVGART really well. And I can talk about how well that's going, and I think it is. The second part was then to continue to grow the base business, so the four other products other than VYVGART. And what we've said is we'll grow those products. This year's ZEJULA being the biggest at a rate comparable to last year, so between 20%-25% sales growth. And the biggest driver there will be ZEJULA continuing to gain share in the PARP class in ovarian cancer. We are the market share leader.
We wanna continue to do that, and I think we are. We have two other approvals that have already happened this year, so we'll be focused on launching those drugs, the second half of the year. That's AUGTYRO, our ROS1 inhibitor in partnership with Bristol Myers Squibb, originally was Turning Point Therapeutics. And then XACDURO, which is an antibiotic for hospital-based Acinetobacter baumannii infections, and we also will launch that the second half of this year. So three big launches. We're focused on one really big launch in VYVGART. We're focused on two new launches. They'll come second half of the year, and then really driving operational performance across the portfolio. We saw really good growth in Q1, and I think good investor, you know, feedback so far on how we've started the year. We'll look to continue that kind of performance throughout the year.
Yeah, for the VYVGART, I think everyone's been super excited about the launch.
Yeah.
Company talking about $70 million for the first year in China.
Yeah.
You know, when I talk to investors, clearly everyone's expecting it's gonna beat that number.
Yeah.
Tell us a bit more about how well you have been executing on the commercialization part in terms of the team setup, in terms of the, you know, penetration and hospital coverage, you know, those healthcare practitioners?
Sure.
Coverage.
Sure, yeah. So, you know, in China, we say there's about 170,000 patients with gMG. And when we look at those 170,000 patients, about 80% of them seek treatment at one of 1,000 hospitals. So it's pretty concentrated for China. So we're focused on 1,000 institutions that, again, cover like 80% of that opportunity. I mentioned we got NRDL listing in January of this year. It's about $800 per vial, US price. So that equates to about $32,000 annual price per year. We'd love that price to be higher, but I think within the bounds of what's reasonable in China from a historical precedent perspective, we thought this was at the high end. And I think it was at the high end of what most, you know, investors expected. So we have a good pricing environment, pretty concentrated prescriber or institution base.
So we know where the patients are. We know where the prescribers are. So what we've focused on this year so far is getting those 1,000 hospitals to take the NRDL listing and pull it down to their local formularies, and to get the physicians in those institutions to try VYVGART. And really to, you know, what we've positioned is to try it with their more acute patients or the patients who historically haven't responded well to existing therapies so that they have a good initial experience with VYVGART, start to get comfort using it, and then try it again. So what we know so far, what we've said, at least as of the end of the first quarter, and these trends continue, is we've had about 1,000 physicians prescribe VYVGART.
We're seeing, you know, what we said in the first quarter is we had about 2,700 new patients start on VYVGART. That was on top of 1,000 new patients who started in Q4. In Q2, we continue to see that kind of 1,000 new patient, you know, per month volume continue to accrue. And what we're seeing, as I say, about 1,000 physicians have already prescribed. More than a third of those physicians have already then tried it with a second patient. So, you know, we're getting initial, you know, initial trial, which is good in the launch, move towards adoption, which is, you know, more you know, try it on multiple patients and have good experiences. So, so far, you know, we said we would sell over $70 million per year.
I mean, this year, and that was just based we said that, you know, when we said that on our year-end call. And really what we were looking at there was, I think, analyst models were in the $40 million or so range. We have not historically given product-level guidance. So, I guess, no, that we don't wanna give a product-level guidance and not be able to achieve it. So I think to your earlier point, we feel quite confident about the trends towards $70 million and above. And I think if we continue to see what we're seeing so far, which is something like 1,000 new patients per month come in, we'll get the benefit then of those patients taking multiple cycles through the year. You know, of course, the ones who start in January, you're gonna get a good effect for.
Those who start, you know, later in the year, we won't get quite so much. But I think we're quite confident that we're trending towards, you know, somewhere above $70 million for the first year. What, what does that mean in total? You know, I think we'd be happy if we were able to get over 10,000 patients, you know, started on VYVGART this year and that they're starting to get the benefits of multiple cycles. In other words, I think that sets us up really well for, you know, for the rest of the life cycle for gMG at least. And I think there's no reason to not believe that 170,000 patients, about 150,000 of them are on label, so serum positive, right?
There's no reason that all of those patients at some point in their disease course couldn't benefit from VYVGART. But we're starting today with those who are, you know, more acute and let physicians get experience, and those.
For these days.
Yeah.
They can't afford it.
Yeah.
Right.
Well, and then yeah, the affordability piece, of course, is, you know, it is on NRDL, so there's, you know, there's the benefit there. And then, as, as you know very well, it comes then down to individual, you know, what other kinds of insurance do you have in terms of the out-of-pocket piece and otherwise. And we're quite sensitive to that. You know, we sell OPTUNE, which is not covered through NRDL, so we, you know, we understand sort of the patient dynamics and otherwise. So, we'll have plenty of programs there. To your question about resourcing, we started with 100 sales reps. I mean, again, this is a pretty concentrated opportunity. We started with 100 sales reps last year. We moved to 150 as we got NRDL listing.
I think what we're seeing is the opportunity is big enough that, you know, we wanna make sure we're fully, fully, saturating the, you know, the opportunity here in terms of medical education otherwise. So we're headed to about 200 sales reps. And I think 200 is, you know, is, is probably the right long-term number for gMG. Again, I think I'd say relative to other opportunities in China, that's super efficient. And this will be a big driver of our long-term profitability.
Got it. Then, you know, other than gMG, of course.
Yeah.
This first indication, then we're gonna have multiple more indication outcomes then, right? What's the next plan?
Yeah.
Next one is gonna be CIDP.
Yes. Yeah.
In terms of commercial preparation for that.
Yeah.
In terms of the regulatory communication and also in terms of the pricing.
Yeah.
How should we think about the future trend?
Yeah, so I think for CIDP first, we had the submission accepted in last month. So, you know, using normal time frames, I think we, you know, and we should expect an approval the first half of next year for sure. The data's very compelling in CIDP, and it was compelling in the Chinese portion of the phase III trials. Relatively, I mentioned 170,000 patients with gMG in China. At CIDP, it's more like 50,000, but it's a more chronic disease. I mean, the drug utilization would be higher in CIDP, and there are fewer alternatives to use today in the Western markets. IVIG is a good foundational therapy or a reasonable foundational therapy. IVIG products are not approved on NRDL for CIDP in China, and as you know, not consistently available anyway.
Right.
So I think the need for patients with CIDP for a drug like VYVGART is pretty compelling. So you can do scenarios, I guess, when you think about the opportunity that even though they're, you know, only about a third of the patients, the market opportunities, you know, could be as big because of the compelling need and the fact that patients will probably take more, you know, drug over time. Pricing, our, you know, our view is, you know, gMG was priced. I mentioned 30, you know, $800 per vial is the sort of foundational price. Our goal is to, you know, push that kind of price for CIDP when we have the chance to negotiate for NRDL. So if we get approval in the first half of 2025 for CIDP, this would be a 2026 NRDL introduction.
And again, our view would be the reference, the best reference price for, for negotiation will be, gMG, IV.
Got it. Well, I think, you know, on the pricing side, there has been a lot of discussion and debate.
Yeah.
On China's pricing environment of drugs, particularly for Zai Lab, company have a very good pipeline and portfolio of high-quality assets. But how we're gonna commercialize that, generate decent returns, has always been one of the key debates among investors. Currently, I think we got a ZEJULA.
Yeah.
We have OPTUNE. We have VYVGART. Or it's all different models.
Right, right.
Different therapeutic areas, right?
Yeah.
Even the pricing point is different. How should we think about that? After running Zai Lab.
Yeah.
For a couple of years, how do you feel like the pricing environment in China to be sustainable for companies like Zai Lab to make decent profit or decent returns?
Right. Well, I've spent a couple of minutes on this 'cause I think it's important. First, I think if you look at ZEJULA, so that's the product. It's our biggest product today. It's one that's been on the market the longest, and we have the most experience with. Now, I think ovarian cancer patients who are eligible for PARPs, the universe is about 50,000 patients. I just put that, you know, that number. Think of that relative to VYVGART. We're competing directly, you know, head-to-head against, you know, AstraZeneca, Merck, BeiGene, Hengrui. I mean, this is a super competitive market. So we've got in the range of about 400 sales reps marketing this against 400 sales reps from AZ, Merck, you know, and so on. It's a quite profitable product for us today.
So even given those dynamics of, you know, smaller patient base, very competitive, resourced pretty intensely, we go after about 2,000, between 2 and 3,000 institutions. It, it by that I mean take the sales, the and all of the sales and marketing costs, we're making money. And we're making good money. That'll get, you know, that'll grow over time. But that's a tough model. I mean, again, that's those are four of the best companies in China to compete against, I think. If we think of VYVGART, we have really no competition for a few years, 200 sales reps, 170,000 patients, and better, better pricing. You know, ZEJULA's, I think, you know, in the range of, you know, somewhere under $20,000 a year for, you know, for a, a standard patient. So, you know, you've got higher pricing there.
So the VYVGART model is great, okay? And I think what I see, I guess what I've seen over a few years is, you know, we'd love more VYVGARTs, but you can do really well with ZEJULA. So I think if you've got a product that is, you know, delivering compelling benefits to patients in a well-defined area, we like the model where these are patients that are going to, whether it's, you know, 1,000, 2,000, or 3,000 touch points for care as opposed to 100,000 or something. So I think that, you know, that model works well for us.
I think if we can achieve pricing for any of the products in China that are, you know, in the range of 15% or higher of what the U.S. net price is, I think that model can work for us. That model works great for VYVGART. I think what we see in the pricing environment overall, though, at least for the things, you know, that I'm referencing here is it's been incrementally positive over the last few years. I think the developments have been good. I think starting with, you know, the move to simplified renewal and more transparency in pricing and how pricing gets established over time and what kind of price reductions you can anticipate and project and on an every two-year basis.
The move to make that more of an algorithmic approach, I think, is really good and I think matches well other experiences I've had in, you know, markets like Japan and others where, you know, the price isn't gonna get better, but you can predict what it looks like and can support a lot of investment. I think the price that we ended up with VYVGART was really good. And I think it rep and we were, I think, in the negotiations, we presented the case you know, we didn't try to undersell that, hey, this is a very rare price of $800 worth. We said, hey, there are 150,000 patients who could benefit from this drug in China. Look at the compelling clinical benefit and otherwise. And I think we were pleased with the price that we came out with.
And I think we think that's, you know, that's gonna be manageable over time. So I think there are lots of things that on a global basis, investors get concerned about with China and otherwise. But I think on the ground, you know, pricing to me feels pretty good, and certainly better than it did in 2021. Or I think, you know, investors certainly, and I think the experience with PD1s and how that price we haven't seen that kind of pressure in the classes we're in. And certainly, I think the experience in the last year has been good.
Yeah. VYVGART currently, if we look at the first quarter numbers.
Yeah.
In the range of gross margin, 60%.
Yeah.
65%, that kind of range. Is that kind of the margin we're talking about over the next few years, or are we gonna see major room for improvement?
Well, I think first, if you look at the, you know, we don't break out product gross margin, but as you mentioned, our total gross margins in that range. We have said that VYVGART is a little bit less than our.
Mm-hmm.
Our corporate average that will improve over time, though. So, you know, we in all of our arrangements with Western biotech, and this includes argenx, we have the right to tech transfer and manufacture product locally. We do that for ZEJULA, for example. For VYVGART, I don't think that makes sense. I mean, we're a big volume driver for that product. So we're buying product from argenx at cost. They've got a huge and really good plan to drive cost reductions in their manufacturing process, mostly driven by scale to move from 5,000-liter production facilities to 20,000. That'll start to kick in for them in later this year, early 2025. For us, we'll probably start to see the benefit of that in 2026 as we get that process approved for China.
But we expect to see step change improvement in gross margin. So I think long way of answering your question, you know, sort of getting the 60s, you know, to, you know, or maybe a little bit better is over the overall for VYVGART. There are gonna be other products that are higher. But again, this is a, you know, it's a relatively high-cost product to manufacture. We have a really good price, but, you know, it's nothing like the price that, you know, I think, I think, argenx gross margin's probably in the 90%-91% or something like that.
Yeah.
We're not gonna get there. Okay.
Got it. Well, on the commercial team, 'cause recently there has been some change of commercial leaderships, right? Could you tell us a bit more about, Andrew, the new leader.
Yeah.
On the commercial and why Zai Lab picking him to become a new leader for the franchise and what's gonna potentially be the impact to the commercial strategy going forward?
Yeah. I think it was a great time to bring in a leader like Andrew who's got a broader so if you look at where we've been, right, so ZEJULA, you know, until this year was really the big driver for our sales performance. And we're quite proud of how our commercial team did and our commercial leadership did to position us well as the market share leader, you know, ovarian cancer in China, which I think is the only market in the world where ZEJULA is the leader, versus Lynparza. So I think, quite pleased and proud of that performance.
but if you look at where we're headed, moving from a, you know, sort of a ZEJULA predominant, you know, team to something that's gonna encompass, VYVGART and KarXT and bemarituzumab, so lots of different, drugs and different, you know, therapeutic areas, having a commercial leader who's got experience across a broad range of therapeutic areas, that's got experience managing a broader portfolio and focusing on not just really good launches, but profitability. And I think we certainly need to, you know, we can't rely just on VYVGART to drive our profitability or just VYVGART and ZEJULA. All of these products need to contribute to our operating margin.
So Andrew's experience, both at Big Pharma, but also then, you know, more recently at a focused, you know, China company, has been on broader portfolio management, has demonstrated really good results in terms of not just top line, but bottom line management, resource allocation, and otherwise. I think also, as we think about the next generation of growth at Zai, what are the next group of products to bring in? How do we think about the really big VYVGART opportunities versus the more targeted, you know, ROS1, products as well? I think, the marketing experience that Andrew has had over his career product planning and otherwise, I think are gonna be increasingly important to us. So that was the leadership team. I think, though, the basics of, you know, for example, with ZEJULA, you know, having a new perspective is always good.
Like, that's good in every job, every business, and everything else. So to have somebody come into a team that's doing really well and has done well and look and say, "Hey, this is great, but have we thought of this?" So I think we'll see some tweaks in, you know, sort of the marketing approach for ZEJULA or for any of our existing products. But I think we're and just to be clear on VYVGART, we hired a guy named Will Chen to launch that product. He is still the brand leader. He reports to Andrew. He's off to a great start. But to have, you know, somebody come in and just have a fresh perspective, that's good no matter what. But I think it's the broader portfolio management.
It's the ability to manage both top line and bottom line and ability to think strategically, you know, from a new product planning perspective are all things that I think Andrew brings, that I'm really excited that he joined.
Got it. Well, let's touch a bit on the small cell lung cancer.
Yeah.
long, long small cell lung cancer franchise. OPTUNE, this is another product.
Yeah.
That has been triggered a lot of ups and downs.
Yeah.
What about the status of the filing based on the LUNA study?
Yeah.
China regulatory discussions, any feedback from the regulators in terms of how we're gonna proceed going forward?
Yeah. So, we've, you know, I think we've been pretty clear in saying, we know that based on our discussions with Chinese regulators, they were gonna, you know, certainly look to what the FDA thinks, views, and, you know, sort of assesses on this product. So in some cases, we're gonna, you know, when we're in a partnership, we're gonna be able to submit simultaneously, you know, with a global submission here. We deliberately wanted to wait till Novocure got pretty far into the FDA review process. That has happened. So we've said we're gonna submit our application in China this year. We're in the process of incorporating the various, you know, feedback and other things from FDA into our submission program. So we would, you know, if everything goes well, we'd expect an approval in 2025.
I think from, you know, what we know, it's an approvable package. It's, you know, hit the endpoint on overall survival, very compelling data in one, you know, subset of that, of that trial. Feedback so far, I think, again, we should be, you know, you never know until you get into the full review and everything else. But, I think from what we know, it's, I think the, the data is, you know, good and compelling and, hopefully leads to a relatively straightforward, China review process. Now, the question then is, what's the opportunity? And I do think in China, what we hear from, not regulators, but thought leaders and prescribing physicians is there is a big need in second line in the second line setting in, in lung cancer for, another option.
You know, if you look in LUNA where the data was most compelling, it was in second line setting. Of course, that was the trial. But, but in combination with the checkpoint inhibitor, the debate in the U.S. has been they're not, that's not very relevant because almost all, you know, patients with, with non-small cell lung cancer get a checkpoint inhibitor in first line. So second line, you're looking for other kinds of, opportunities. In China, that's not the case, right? I mean, more than 50% of patients in the first line setting are getting something like Tagrisso or.
Mm-hmm.
You know, they're not getting a checkpoint inhibitor. So physicians are saying, hey, if there's an option that's safer, you know, that's got good safety and it's combinable with a checkpoint inhibitor, that's something we're, you know, interested in trying. So I think we're, you know, cautiously optimistic on the review process. And I say that only because it has been a controversial piece, and we, you know, need to see how the FDA weighs in. But we'll get that submitted this year. And again, I think we'll be ready to go and launch in 2025, provided the review process goes well.
Got it. We're looking forward to that.
Yeah.
Another part of the business is really on internal R&D.
Yeah.
Which,
Yes.
I think in the past few years, Zai Lab is really putting a lot of efforts trying to developing your in-house pipeline.
Yeah.
Is there anything that we can look forward to over the next six to 12 months?
Yeah.
In terms of,
Oh, yeah.
In terms of the research team.
Yeah.
Status, you know, how the team has been doing and size of the team, what they're really working on, 'cause there are so many different directions you can pursuing.
Right.
So.
I'll go in sort of backwards order from where the pipeline is and end up in our discovery team and what they're working on. But, you know, our most advanced global asset is an IL-17 nanobody. So it's a topical formulation for mild to moderate psoriasis. We just started a global phase II program. We're quite excited about this opportunity. I mean, we still have to generate the data, but if you can achieve PASI 75, 90, you know, PASI 90 scores that are like what you see with the systemic, you know, injectable biologics, through this topical that doesn't have a systemic, you know, side effect profile, we think it can open the market up in a real way for, you know, a step change in efficacy for patients with mild to moderate psoriasis.
We're doing the dose finding work in phase II now. So I think by the end of next year, we'll have data that's, you know, tells us whether or not there's a, you know, there's a big opportunity here. And again, we're cautiously optimistic. That is a drug that we've developed, you know, in-house from the beginning. We have two oncology products in phase I development. The one that I think is most exciting, you know, given the developments in the field, is our DLL3 ADC, which we're studying for small cell lung cancer and other tumors that overexpress DLL3. Again, we know this is a validated target, obviously an approved bispecific now. And this is a product we licensed in.
Mm-hmm.
From MediLink last year. So a China-based biotech. But we think this has got a real opportunity to differentiate versus the approved bispecific, in that it, I think, can, you know, be safer, can be combinable, with PD-1s. And I think that gives us a really exciting opportunity. We're early in development. It's, you know, tempting to see a few patients and get super excited, but that's where we are. We're, you know, we're starting to see patient responses. And I think this is a product that could move very fast if the data continues to bear out. And this would be a global opportunity, not just for China, but for the U.S. and beyond. We also have a CCR8 that's in development for solid tumors that, again, I think could, you know, based on data, could be quite compelling.
So then if you move back to research, we hired Peter Huang about a year, about two years ago, to lead our discovery organization. We had a research facility in Menlo Park, California that probably wasn't fit for purpose. So we closed that and even opened a lab in San Diego to complement our labs in Shanghai. So we've got labs now in Shanghai, Suzhou, and San Diego. Peter's background is he's a small molecule chemist, worked on small
molecules at Pfizer and Zentalis. So has worked on a lot of the small molecule oncology targets over the years you know, over his long career. So we've got a heavy emphasis on that in discovery. But I think really mechanistically, you know, sort of agnostic.
So we've got programs, preclinical programs in oncology and immunology focused in small molecule, you know, basic bi you know, antibody and ADCs. I think we have, you know, capability to cross there. Our investment is not big. We're not, you know, we're not gonna generate five, six, 10 INDs a year. Our goal is to have two per year. And I would say that if you look at the preclinical programs and work that's happening now, we're on track for one this year, by the end of this year and probably ramp up to two per year, you know, in the next few years. So that keeps our investment relatively modest. I would say the, you know, the investment in the researchers themselves, so the biologists, translational medicine, and so on, are 10s of millions of dollars.
And then, of course, we'd like to spend a lot more to take those programs, you know, through clinical development and otherwise. And our, you know, our goal will be to bring things in to the clinic that have a, you know, have some hypothesis on either being first or best in class. We're not looking for the third, fourth, or fifth, you know, to market product in China. The, the emphasis we have in discovery is for products that can compete on a global scale. And I think we'll, you know, we'll, we'll have that hypothesis when we declare a candidate and we move something into phase I. And if we don't see the data that sort of gives us a belief that this could be a, you know, best in class type of opportunity, we'll stop.
And we've done that, you know, over the course of the last couple of years. I mean, since I've been involved, we've, you know, terminated some programs just because it, you know, the molecules were okay, but they weren't, you know, we couldn't really differentiate. But I think we're quite excited and more to come there. I mean, we'll talk about the, the targets themselves as we declare candidates and move into phase I.
Well, Zai Lab, we used to, you know, known for licensing and picking the good assets from the global partners. But now we're building the in-house capability. And in the past two years, you know, we can see that actually the licensing pace has been slowing down a little bit, right?
Yeah. Yeah.
In terms of how we think about the capital allocation, where we're gonna spend more money, internal R&D, they'll be more aggressive or more open-minded about selecting some asset from the global partners.
Yeah.
Or some other things you wanna do. So how should we think about the capital allocation?
Yeah. I think as it relates to partners, you know, what we have done, what our bread and butter has been historically, so bringing in really compelling de-risked assets into China. We still wanna do that, but it's a high bar right now because, I mean, if you look, we've got, you know, the, again, all the things I've talked about on VYVGART,
KarXT.
bemarituzumab, bemarituzumab, KarXT. So, you know, for us to bring in the next product, it we wanted to either bring margin opportunity immediately, and TIVDAK is one of those and one of the deals we've done more recently. And that's for cervical cancer, I think a pretty good commercial opportunity, but a great opportunity from a profit perspective because we'll launch that right through our ZEJULA sales rep. It's the same, same physicians treat cervical cancer or treat ovarian cancer. We'd love to find the next, VYVGART. So would everybody else, right? I mean, and they're, they're not that many. But I think, you know, it either has to be a, like a $500 million-$1 billion standalone franchise opportunity that we think has got good pricing and, you know, competitive dynamics or something that immediately complements what we're doing today.
I, I think by design, you're seeing fewer deals because we have a very, very high bar. We still, I would, you know, I'd be disappointed if, if, if at this time next year, I'm not talking about some other great late phase asset that we brought into China. We don't need to, you know, we can afford to say no to a lot of a lot of things, and we have. I think on the global side, there are good opportunities for late preclinical, early clinical, you know, best in class or first in class types of technologies in, in oncology and immunology where we have a really good global, ability to develop products and to source, source them and make decisions.
So, I think, you know, expect probably another ADC program from us to come out of whether it's China or, you know, somewhere, you know, here in the U.S. And I'd love to find an, you know, there's a lot of really good developments in immunology. And I think we can, you know, we've got great insights now 'cause we participate with argenx, you know, in every program that they're developing. So I think our insights, our ability to look at some very early data and make a bet are, you know, we're world class there, I think. So I think we'll see something there.
But I would love the problem of these programs coming out of research or DLL3 to have, you know, that the best way to create value is to have an internally discovered or program that you've got global rights on with very limited obligations. Those are the things we wanna move fast. So I think, you know, again, I would say the one that, to me, you know, keep your eye on is DLL3 because we know if the data is compelling, we can move faster. There's, you know, a huge unmet need in small cell lung cancer. And we'll put the kind of resources behind that. And again, we owe very little back to MediLink in terms of royalties or anything from there.
Last question.
Yeah.
Also related to resources 'cause, in the past few quarters, I think Zai Lab has been managing the cash burn very efficiently.
Yeah.
I think now there has been fewer debates about whether you can really make it to 2025.
Yeah.
What about the cash runway now? How should we think about the cash, funding environment in China? When Zai Lab is talking about, you know, strengthening the in-house pipeline.
Yeah.
Talking about potentially next year, we're gonna talk in something new.
Yeah.
Licensing deals. Then how should we think about the cash?
Yeah. So, you know, we closed Q1 with $750 million in cash. And I think if you play out our quarterly burn to get to profitability in 2025, we've got plenty of cash to fully invest behind the launches we need to invest behind, to fully invest in the development of the programs that I've mentioned, and to do the kind of business development that we have historically done, which are pretty capital light upfront types of things, right? We haven't been putting, you know, triple-digit millions into, you know, into acquisitions. It's been $10 million, $20 million. Then we step into the risk, you know, through development. So I think we're pretty confident that that $750 million gives us plenty of cash and cushion to get us through the end of 2025.
Then, you know, in 2026 and beyond, we start to generate pretty significant cash, you know, as the portfolio continues to expand and otherwise. Sure. I mean, if the opportunity was there to you know, raise money at a good price and everything, we would do that. But we don't have to wake up in the morning, you know, sort of figuring out how to get the next $100 million, $200 million, $300 million. So I think we're pleased with where we are. We don't feel any constraints, I think, around investing in the programs. And if we saw something that took us out of that, you know, that range or comfort zone or whatever it is, you know, we know your team and others, you know, are ready to help there.
I think we do have access to. We could raise if we needed to. We have access to lots of various ways to raise money in China or in the U.S., but we don't need to. I think that's a pretty privileged position to be in for a, you know, for a company, in 2024.
Great.
Okay?
With that, we're gonna close the session.
Okay.
Thank you so much, John.
Okay. Great.
Okay. Great.
Thank you.