YS Biopharma Announces Unaudited Financial Results for the First Quarter of Fiscal Year 2024

Pipeline makes progress towards commercialization as robust demand for YSJA rabies vaccine continues

Gross margin increases to 80.3%; balance sheet remains strong

GAITHERSBURG, Md., Aug. 16, 2023 /PRNewswire/ — YS Biopharma Co., Ltd. (NASDAQ: YS) (“YS Biopharma” or the “Company”), a global biopharmaceutical company dedicated to discovering, developing, manufacturing, and delivering new generations of vaccines and therapeutic biologics for infectious diseases and cancer, today announced its unaudited financial results for the first quarter of the fiscal year ended March 31, 2024 (the “first quarter of fiscal year 2024”).

Dr. David Shao, Director, President, and CEO of YS Biopharma, commented, “During the first quarter of fiscal year 2024, our top-line came under pressure from tight inventory levels of finished products available for sale, caused by the lingering impacts of COVID-related disruptions at our YSJA rabies vaccine manufacturing facilities. While these disruptions occurred in late 2022 and early 2023, the long and complex nature of the vaccine manufacturing process means that we are experiencing the impact at present. In the first quarter, we took several steps to enhance our operations and ensure future stability, including boosting manufacturing productivity, building out our sales network, and streamlining research and development efforts. Demand for our YSJA rabies vaccine remains robust, and we continue to bring our pipeline of promising product candidates, including our next generation PIKA rabies vaccine, towards commercialization. We are confident that we will overcome the near-term difficulties we have faced, and we believe we are well-positioned for sustainable, long-term success.”

Ms. Brenda Wu, CFO of YS Biopharma, added, “In the first quarter of fiscal year 2024, our total revenues were RMB176.3 million, as we continued to deal with the fallout of COVID-related disruptions on our supply chains and manufacturing operations. Our gross profit for the quarter was RMB141.6 million, and we recorded a solid gross profit margin of 80.3%. As of the end of the first quarter, our balance sheet remains strong, and we plan to diligently monitor our expenses in order to create a stable foundation for our long-term growth. We are confident in our business model and excited for the opportunities the future holds.”

Business Updates

YSJA™ Rabies Vaccine

YS Biopharma’s marketed vaccine product, YSJA™ rabies vaccine, was the first aluminum-free lyophilized rabies vaccine launched in China. Since the Company commenced production at its current GMP-compliant facilities in February 2020, and, since it commenced the product’s commercialization in late 2020, market intake of the Company’s YSJA rabies vaccine has been consistent and strong. As of June 30, 2023, YS Biopharma had sold more than 22.2 million doses of YSJA™ rabies vaccines to approximately 1,725 CDC customers, which represents over 60% of CDC customers in China.

Clinical Pipeline

YS Biopharma continues to advance its portfolio of innovative product candidates under various clinical development stages, including PIKA rabies vaccine, PIKA recombinant COVID-19 vaccine, and PIKA YS-ON-001.

PIKA Rabies Vaccine

As of June 1, 2023, the Company had been granted approval by regulatory bodies in the Philippines, Singapore, and Pakistan to undertake Phase III clinical trials of the vaccine. This multi-country Phase III study is a registration trial and will evaluate the vaccine’s ability to induce an immune response and its safety profile. The Company intends to include a total of 4,500 participants in the Phase III trial, with the recruitment process projected to commence in the fourth quarter of 2023. The Company aims to obtain interim results by early 2024.

PIKA Recombinant COVID-19 Vaccine

In March 2023, the Company reported positive interim safety and immunogenicity data for the PIKA recombinant COVID-19 vaccine from Phase II of the Phase II/III clinical studies which were completed in the Philippines and the UAE. The safety and efficacy of the Company’s PIKA adjuvant technology was validated in the Phase II/III trial, which involved roughly 6,000 participants. The Company anticipates the findings from the Phase III clinical trials will be released before the end of 2023. The Company will continue to monitor the evolving global situation surrounding COVID-19, and will utilize appropriate commercialization strategies for the PIKA recombinant COVID-19 vaccine accordingly.

PIKA YS-ON-001

PIKA YS-ON-001 is designed as an immunological therapeutical agent against cancers. The Company has completed the enrollment of cancer patients for the Phase I clinical trial of PIKA YS-ON-001 in China. The Company expects the Phase I clinical trial will be completed by December 31, 2023.

First Quarter of Fiscal Year 2024 Financial Results

Total Revenues

Total revenues were RMB176.3 million (US$24.4 million) in the first quarter of fiscal year 2024, compared to RMB205.5 million in the same period of fiscal year 2023, representing a change of 14.2%. This was primarily due to COVID-related disruptions affecting raw material supply chains, manufacturing operations, and production output at the Company’s YSJA rabies vaccine production facilities, which negatively impacted batch approvals and doses available for sale.

Gross Profit

Gross profit was RMB141.6 million (US$19.6 million), representing an 80.3% gross margin, compared to RMB154.3 million, or a 75.1% gross margin, in the same period of fiscal year 2023.

Selling and Marketing Expenses

Selling and marketing expenses in the first quarter of fiscal year 2024 were RMB79.2 million (US$11.0 million), compared to RMB70.5 million in the same period of fiscal year 2023. The increase in selling and marketing expenses reflects the Company’s ongoing long-term strategies to enhance promotional and marketing services in order to expand and strengthen its distribution network of district- and county-level CDCs and hospitals. This targeted expansion aligns with the Company’s commitment to driving growth in key markets.

General and Administrative Expenses

General and administrative expenses in the first quarter of fiscal year 2024 were RMB31.8 million (US$4.4 million), compared to RMB25.5 million in the same period of 2023. This change was primarily attributable to higher professional service fees associated with the Company’s status as a publicly-listed entity.

Research and Development Expenses

Research and development expenses were RMB100.6 million (US$13.9 million) in the first quarter of fiscal year 2024, compared to RMB70.3 million in the same period of 2023. The change was primarily driven by an increase in preclinical and clinical development costs associated with the Company’s rabies vaccine pipeline. This increase reflects the Company’s targeted allocation of resources to advance its promising rabies vaccine candidates through various stages of development, in line with the Company’s commitment to innovation and addressing unmet medical needs.

Net Loss

Net loss for the first quarter of fiscal year 2024 was RMB69.5 million (US$9.6 million), compared with RMB19.6 million in the same period of 2023.

Balance Sheet

As of June 30, 2023, the Company had cash and cash equivalents of RMB311.8 million (US$43.1 million), compared with RMB370.4 million as of March 31, 2023.

Corporate Update

As part of its strategy to unlock the commercial potential of its vaccine franchise in underserved markets in Southeast Asia, the Company recently set up a new subsidiary in the Philippines to focus on clinical and regulatory efforts and product commercialization.

Conference Call Information

The Company’s management will hold an earnings conference call on Tuesday, August 15, 2023 at 8:00 P.M. Eastern Time to discuss the financial results. Listeners may access the call by dialing the following numbers:

United States Toll Free:               1-888-346-8982
International:                                1-412-902-4272
Mainland China Toll Free:            4001-201203
Canada Toll Free:                        1-855-669-9657
Hong Kong:                                  852-301-84992

The replay will be accessible through August 22, 2023 by dialing the following numbers:

United States Toll Free:                1-877-344-7529
International:                                 1-412-317-0088
Canada Toll Free:                          855-669-9658
Access Code:                                8167733

A live and archived webcast of the conference call will also be available at the Company’s investor relations website at https://investor.ysbiopharm.com/.

About YS Biopharma 

YS Biopharma is a global biopharmaceutical company dedicated to discovering, developing, manufacturing, and delivering new generations of vaccines and therapeutic biologics for infectious diseases and cancer. It has developed a proprietary PIKA® immunomodulating technology platform and a new generation of preventive and therapeutic biologics targeting Rabies, Coronavirus, Hepatitis B, Influenza, Shingles, and other virus infections. YS Biopharma operates in China, the United States, Singapore, and the Philippines, and is led by a management team that combines rich local expertise and global experience in the biopharmaceutical industry. For more information, please visit investor.ysbiopharm.com.

Exchange Rate Information

This announcement contains translations of certain RMB amounts into U.S. dollars at a specified rate solely for the convenience of the reader. Unless otherwise noted, all translations from RMB to U.S. dollars are made at a rate of RMB 7.2258 to US$1.00, the exchange rate set forth in the central parity rate release of the People’s Bank of China on June 30, 2023.

Cautionary Statement Regarding Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical or current fact included in this press release are forward-looking statements, including but not limited to statements regarding the expected growth of YS Biopharma, the development progress of all product candidates, the progress and results of all clinical trials, YS Biopharma’s ability to source and retain talent, and the cash position of YS Biopharma following the closing of the Business Combination. Forward-looking statements may be identified by the use of words such as “estimate,” “plan,” “project,” “forecast,” “intend,” “will,” “expect,” “anticipate,” “believe,” “seek,” “target” or other similar expressions that predict or indicate future events or trends or that are not statements of historical matters. These statements are based on various assumptions, whether identified in this press release, and on the current expectations of YS Biopharma’s management and are not predictions of actual performance.

These statements involve risks, uncertainties and other factors that may cause actual results, levels of activity, performance, or achievements to be materially different from those expressed or implied by these forward-looking statements. Although YS Biopharma believes that it has a reasonable basis for each forward-looking statement contained in this press release, YS Biopharma cautions you that these statements are based on a combination of facts and factors currently known and projections of the future, which are inherently uncertain. In addition, there are risks and uncertainties described in the final prospectus relating to the proposed Business Combination, and other documents filed by YS Biopharma from time to time with the SEC. These filings may identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements.

YS Biopharma cannot assure you that the forward-looking statements in this press release will prove to be accurate. These forward-looking statements are subject to a number of risks and uncertainties, including, among others, the ability to recognize the anticipated benefits of the Business Combination, costs related to the transaction, the impact of the global COVID-19 pandemic, the risk that the transaction disrupts current plans and operations as a result of the consummation of the transaction, the outcome of any potential litigation, government or regulatory proceedings, the sales performance of the marketed vaccine product and the clinical trial development results of the product candidates of YS Biopharma, and other risks and uncertainties, including those included under the heading “Risk Factors” in the post-effective amendment No. 1 to Form F-1 filed with the SEC on August 8, 2023 which became effective on August 10, 2023, and other filings with the SEC. There may be additional risks that YS Biopharma does not presently know or that YS Biopharma currently believes are immaterial that could also cause actual results to differ from those contained in the forward-looking statements. In light of the significant uncertainties in these forward-looking statements, nothing in this press release should be regarded as a representation by any person that the forward-looking statements set forth herein will be achieved or that any of the contemplated results of such forward-looking statements will be achieved. The forward-looking statements in this press release represent the views of YS Biopharma as of the date of this press release. Subsequent events and developments may cause those views to change. However, while YS Biopharma may update these forward-looking statements in the future, there is no current intention to do so, except to the extent required by applicable law. You should, therefore, not rely on these forward-looking statements as representing the views of YS Biopharma as of any date subsequent to the date of this press release. Except as may be required by law, YS Biopharma does not undertake any duty to update these forward-looking statements.

Investor Relations Contacts

Alyssa Li
Director of Investor Relations
Email: [email protected]

Robin Yang
Partner, ICR, LLC
Tel: +1 (212) 537-4035
Email: [email protected]

 

 

YS Biopharma Co., Ltd.

UNAUDITED CONSOLIDATED BALANCE SHEETS

(All amounts in thousands, except for share and per share data)

As of March 31,

As of June 30,

2023

2023

2023

RMB

RMB

US$

ASSETS

Current assets

Cash

370,108

94,749

13,113

Restricted cash

262

217,036

30,036

Accounts receivable, net

463,052

495,907

68,630

Advance to suppliers, net

6,763

9,942

1,376

Inventories, net

185,381

182,370

25,239

Prepaid expenses and other current

assets

10,413

6,171

854

Total current assets

1,035,979

1,006,175

139,248

Non-current assets

Property, plant and equipment, net

571,756

566,872

78,451

Operating lease right-of-use assets, net

11,132

10,934

1,513

Deferred tax assets, net

1,906

2,491

345

Intangible assets, net

78,057

76,335

10,564

Other assets, non-current

20,924

27,069

3,746

Total non-current assets

683,775

683,701

94,619

Total assets

1,719,754

1,689,876

233,867

 LIABILITIES AND SHAREHOLDERS’

 (DEFICIT)/EQUITY

Current liabilities

Bank loans and other borrowings –

current

193,737

171,608

23,749

Accounts payable

80,439

73,868

10,223

Accrued expenses and other liabilities

377,537

398,930

55,209

Operating lease liabilities – current

4,754

5,035

697

Deferred government grants – current

2,296

2,296

318

Total current liabilities

658,763

651,737

90,196

Non-current liabilities

Bank loans and other borrowings – non-

current

293,791

343,286

47,508

Operating lease liabilities – non-current

6,349

6,683

925

Deferred government grants – non-

current

23,607

25,033

3,464

Warrants liability

8,792

2,384

330

Total non-current liabilities

332,539

377,386

52,227

Total liabilities

991,302

1,029,123

142,423

Shareholders'(deficit)/equity

Ordinary shares, par value US$0.00002 per share;
9,950,000,000 shares authorized; 93,058,197
shares issued and outstanding as of March 31,
2023 and June 30,2023, respectively

12

12

2

Additional paid-in capital

2,656,891

2,656,891

367,695

Accumulated deficit

(1,874,039)

(1,943,579)

(268,978)

Accumulated other comprehensive loss

(54,412)

(52,571)

(7,275)

Total shareholders’ equity

728,452

660,753

91,444

Total liabilities and shareholders’ equity

1,719,754

1,689,876

233,867

 

 

 

YS Biopharma Co., Ltd.

UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(All amounts in thousands, except for share and per share data)

For the three months ended June 30,

2022

2023

2023

RMB

RMB

US$

Revenues

205,476

176,274

24,395

Cost of revenues

51,134

34,680

4,799

Gross profit

154,342

141,594

19,596

Operating expenses:

Selling and marketing

70,493

79,195

10,960

General and administrative

25,509

31,813

4,403

Research and development

70,288

100,640

13,928

Total operating expenses

166,290

211,648

29,291

Loss from operations

(11,948)

(70,054)

(9,695)

Other income (expenses):

Late fees related to social security insurance

(228)

(154)

(21)

Government grants

210

1,474

204

Financial expenses, net

(7,375)

(8,028)

(1,111)

Fair value changes of warrant liability

6,693

926

Other income (expense), net

360

(59)

(8)

Total other income (expense), net

(7,033)

(74)

(10)

Loss before income taxes

(18,981)

(70,128)

(9,705)

Income tax expense

(612)

586

81

Net loss

(19,593)

(69,542)

(9,624)

Accretion to redemption value of

convertible redeemable preferred shares

(34,473)

Net loss attributable to YS Group

(54,066)

(69,542)

(9,624)

Net loss

(19,593)

(69,542)

(9,624)

Other comprehensive income (loss): foreign

currency translation adjustment

(79,358)

1,841

255

Total comprehensive loss

(98,951)

(67,701)

(9,369)

Loss per share:

– Basic and Diluted

(0.32)

(0.75)

(0.10)

Weighted average number of ordinary shares
outstanding:

– Basic and Diluted

61,827,883

93,058,197

93,058,197

 

 

 

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