Gyre Therapeutics — Second Quarter 2026 Earnings Summary

Financial Performance

• Q2 2026 revenue was $29.1 million, a 2% decrease from $29.7 million in Q2 2025; Year-to-Date (YTD) revenue was $53.5 million, a 11% decrease from $60.3 million in the same period of 2025.
• Q2 2026 GAAP net loss was $14.3 million compared to a net loss of $2.2 million in Q2 2025; YTD 2026 GAAP net loss was $32.8 million compared to net income of $2.7 million in YTD 2025.
• Q2 2026 GAAP basic EPS was $(0.12) compared to $(0.02) in Q2 2025; YTD 2026 GAAP basic EPS was $(0.26) compared to $0.00 in YTD 2025.
• Q2 2026 non-GAAP adjusted net loss was $12.2 million compared to $0.6 million in Q2 2025; YTD 2026 non-GAAP adjusted net loss was $21.1 million compared to non-GAAP adjusted net income of $3.7 million in YTD 2025.
• Q2 2026 operating loss was $14.4 million compared to $2.2 million in Q2 2025; YTD 2026 operating loss was $33.3 million compared to $0.3 million operating income in YTD 2025.
• Cash and cash equivalents totaled $43.3 million as of June 30, 2026, down from $49.2 million as of December 31, 2025; total cash and investments decreased by $12.9 million (11%) to $103.2 million.
• Q2 2026 R&D expense increased 129% to $19.1 million from $8.4 million in Q2 2025; YTD 2026 R&D expense increased 87% to $30.6 million from $16.4 million in YTD 2025.
• Q2 2026 transaction costs were $0.5 million; YTD 2026 transaction costs were $6.9 million.

Guidance and Future Outlook

• Full year 2026 revenue guidance of $100.5 million to $111.0 million was affirmed.
• IND applications for two Cullgen degrader assets (CG923308 and CG620953) are expected in Q1 2027.
• The final patient in the Phase 3 pirfenidone trial for pneumoconiosis is expected to complete the study by Q4 2026.
• A Phase 2 study for CG001419 in cancer-induced bone pain is planned following the completion of a Phase 1 study in Australia.

Business Segments and Product Lines

• ETUARYTM (pirfenidone) sales were $28.0 million in Q2 2026, up from $23.5 million in Q2 2025.
• EtorelTM (nintedanib) sales were $0.3 million in Q2 2026, down from $1.6 million in Q2 2025.
• ContivaTM (avatrombopag) sales were $0.9 million in Q2 2026, down from $1.5 million in Q2 2025.
• Collaboration revenue from the Astellas Pharma Inc. agreement decreased by $3.0 million in Q2 2026 as the agreement ended in March 2026.
• F351 (hydronidone) NDA for CHB-induced liver fibrosis was accepted by China's CDE in May 2026.
• Gyre acquired Cullgen Inc. in an all-stock transaction valued at approximately $300 million in May 2026, adding targeted protein degrader and DAC pipelines for cancer and inflammatory diseases.
• CG001419 is being evaluated in a Phase 1 trial in China for solid tumors and a Phase 2 study is planned for cancer pain.
• CG009301 (GSPT1 Degrader for AML) continues in a Phase 1 dose-escalation trial in China.

Market and Competitive Landscape

• ETUARYTM sales growth was driven by focused marketing efforts despite lower revenues from ContivaTM and EtorelTM following the implementation of China's national centralized procurement program.
• The combined company has roughly 740 employees and operates with subsidiaries in Beijing and Shanghai.
• Gyre Pharmaceuticals holds a 69.7% equity interest as of June 30, 2026.

Risks and Challenges

• Risks include potential adverse reactions or changes to business relationships resulting from the Cullgen acquisition and the risk that the combined company may not successfully integrate businesses or realize expected benefits.
• Clinical development risks include potential delays in trial commencement, enrollment, and completion, as well as uncertainties regarding regulatory approval.
• Risks exist regarding the inability to obtain sufficient additional capital to advance product candidates and pre-clinical programs.
• There is a risk that the combined entity may fail to realize value from product candidates due to inherent difficulties in bringing them to market.

Management Commentary and Tone

• CEO Dr. Ying Luo expressed pleasure with progress, highlighting the Cullgen acquisition, NMPA acceptance of F351 NDA, and increased sales from Gyre Pharmaceuticals.
• Management stated the combined pipeline offers a full spectrum of assets addressing fibrosis, inflammatory diseases, cancer, and pain, with a focus on long-term upside from the TPD/DAC platform.
• Management noted that China-based innovation capabilities are expected to drive cost efficiencies for early-stage development.

Other Key Points

• The Cullgen acquisition was accounted for as a transaction between entities under common control, requiring retrospective recasting of financial statements.
• Dr. Ying Luo, former CEO of Cullgen, was appointed President and CEO of Gyre and joined the Board; Yue Xiong (former Cullgen CSO) and Thomas Eastling (former Cullgen CFO) were appointed CSO and CFO of Gyre, respectively.
• Ping Zhang was named Chairman of Gyre Therapeutics.
• The transaction included $3.8 million in costs related to the terminated merger between Cullgen and Pulmatrix, Inc. in February 2026.
• A $4.8 million milestone payment was owed to GNI Group Ltd. related to the NMPA acceptance of the F351 NDA.
• Total Gyre stockholders' equity increased to $107.9 million as of June 30, 2026, from $62.5 million as of December 31, 2025.