This call will be conducted in English. My name is Laurence Tam, China Healthcare Analyst at Morgan Stanley.

Tonight we're honored to have the management team of WuXi Biologics present to us their 2025 annual results. We have Dr.

Chris Chen, who is the CEO of WuXi Biologics; Mr. Tu Ming, CFO of WuXi Biologics; Dr.

Lina Fan, the Head of IR Team; and Willis Wu, also part of the WuXi Biologics IR Team. The call will last for an hour and 15 minutes.

There will be prepared remarks from management, followed by a Q&A session. Investors can type their questions into the Zoom Q&A box at the bottom of the window, or you can email me your questions at [email protected].

With that, I will pass it on to Chris to give us an overview of 2025 results.

Thank you Laurence. Thank you Lawrences.

Great to give a global investor an update of 2025. I think we believe that we have a very unique business model called CRDMO.

I think we're benefiting from all three exciting modalities of bi- and multispecifics, ADCs, and traditional mAbs. I think this combined exciting business model with all those three new modalities will deliver sustainable high growth for us.

I will start with talking about annual results and then our CFO will talk about the financial review. I'll then give an operational update and then I always want to give global investors an update on our technology platforms and our WuXi Business System and ESG, and then I'll end with a summary and outlook for 2026.

For global investors, I think this slide should be very familiar. I've been using the same template for a while.

I think I'm very excited to share with you that on this slide, almost every number is record high for the company except the gross profit margin. As during COVID, our utilization rate was very high, that's why our gross profit margin was record high.

Now it's close to record high, but it's not highest yet, but other than the gross profit margin, every other number is record high. If you look at the number of integrated projects, we grow from 817 in 2024 to 945.

Hopefully next time when we report, we'll see more than 1,000 projects. We added a whopping 209 projects.

I think this is record high for the company. Our number of commercial projects also grow from 21 to 25.

I always said the backlog is huge and it's very hard to grow, but this time we actually see a very strong growth on the backlog as well, grow from $18.5 billion to $23.7 billion. We have a record high number of regulatory inspections, still we are 100% success.

Our talent retention rate is still incredibly strong. On the right side is the financials.

You guys read from the news release already, I think I want to quickly highlight: revenue grow seven 16.7%. If you took continuous operations pass is a 20+% percent.

Adjusted EBITDA 20 20 22.8%, and adjusted net profit attributable to owner of the company, 17.9%, right? I promise investors we're going to improve our margin by about 100 bps every year for the next couple of years.

Last year we see a very strong 500 bps improvement on gross profit margin. As a result, our EBITDA margin and then also net profit margin are both near record high.

Our EPS grow very strongly, 48.8%. This funnel, as global investors are very familiar with already, I think I also shared with global investors during J.P.

Morgan conference. On the four key numbers on the right side of the funnel really represent WuXi Biologics.

Then based on that, you can actually see how strong our revenue growth will be, right? We added a record 209 projects, we have 25 commercial programs, our total funnel size 945, and we have 74 programs in Phase 3.

Among the 209 projects added last year, about 2/3 of them are actually bispecific and ADCs. About half of them come from US.

We also have 23 "Win the Molecule" projects, that's the 11 + 6 + 6. Among the "Win the Molecule" projects, also half of them are complex modalities.

I think during the past 2 years, we have encountered quite some noise from the global geopolitics systems, but despite with all those noise, our funnel is very, very sticky. We lost about four projects during the past 2 years.

Essentially four projects transfer out. On the right side, you see many, many projects terminate.

This is actually terminate for cause, basically either the program didn't work or our client decided not to proceed. They're not because project transfer out of WuXi Biologics.

On the right side, we actually only see four projects transfer out in the past 2 years, but on the left side, we see about 43 projects transferred in. I use this ratio of 10-to-1 to again show how sticky our business is, right?

Again, despite all those noise in the past 2 years, we only lost four projects, and we won 43 projects. Interestingly, for the four projects we lost in the past 2 years, two of them may come back later this year, I'll report next time when we actually sign them back.

This gives you a summary of the number of projects we added. Before COVID, the average number of projects we added was about 60.

During COVID, it becomes 100, 110, and then last year was again 209. This really show our increased market share, global acceptance of WuXi Biologics as a preferred partner, and our strong track record attracting more and more clients globally, in US, in Europe, in China, and in Asia, Japan and Korea.

"Win the Molecule" project has been very steady, about 20 projects a year, and then among them, some are early phase, some are late phase. Because over the past 7 years, we have won so many projects, every project are tech transfer in.

Those are projects either completed at large pharma tech transfer to us or completed at our peers and transfer to us. I think of all those 100+ projects are delivered successfully.

We actually have 12 CMO projects already come from this "Win the Molecule" strategy. Now we are proven by our industry as the company who are most versatile, who are able to receive anyone's process and make it work.

I think so we have worked with probably a dozen, more than a dozen different cell lines, different process, different media, and then we are able to make all the process work. They are either ADCs or bispecifics or mAbs.

I think this tech transfer in excellence really will drive our future revenue growth as well. I mentioned tech transfer in, right, that basically means either large pharma or our competitor don't have enough capacity or failed to do the project and then transfer to us.

The other phenomenon in our industry is acquisition. When large pharma acquire biotech or when large biotech acquire an asset from China, if the program is already done at WuXi, what do they do?

Do they transfer project to someone else? The answer is absolutely no.

For all the programs who are in the clinic, if the program is acquired either by a biotech company or by a large pharma company, they actually end up the projects stay at WuXi 100%. Beyond that, they actually because they know more about WuXi, because we are doing the project for them, they actually give us more projects.

Over the past almost 7 years, we actually see 32 more assets coming to us, because through the acquisition, client get to know us better and then they trust us, they give us more projects. Again, all those slides basically show how sticky our business model is.

That's why I always said the funnel, if you look at the funnel, that's how the assurance I have for future revenue growth, because the funnel is very sticky. Once projects get into the funnel, despite all the geopolitics, we lost four projects and then two of them may come back.

Then we are talking about a total of about 900 projects, right, in the funnel during the past 2 years. I think in terms of revenue, we see a very strong growth in early phase, right, from R and early D, or DNA to IND enabling, we see a 30 almost 32% growth.

In term of M, basically PPQ and commercial, we see a 26% growth. In the middle, the program of who are in Phase 1 and Phase 2, we see a decline.

As I explained last time already, I think we see a similar trend last year, last time, is because quite a few program give us a lot of revenue in Phase 2, now we classify them, we move them to Phase 3, because they are already in Phase 3. Our client moved them to Phase 3.

As a result, we move them from Phase 2 to Phase 3, that's why you see a very strong growth on Phase 3 and you see a decline on Phase 2. Hopefully this is only temporary, and we will see all three segment grow again.

If you look at the geographic wise, we actually see China being fairly stable and all other region actually grow significantly. You see US account for 58% of revenue, is still growing 18%+.

Europe is 23% of revenue and growing almost 17%. Combining US and Europe is actually more than 80% of revenue and is growing around 17% to 18%, right?

The highest growth actually went to Japan and Korea, we actually see almost 70% growth. It's become now very meaningful revenue, a couple years ago was only 1%, 2%, now it's actually 6.5% of revenue, half of the China already, right?

In China, we see a slight decline of revenue, but if we have seen so many out-licensing deal, if you adjust the out-licensing deal of last year alone, you will see almost a flat year-over-year growth. If you put all the out-licensing deal in the past added together, China will see a much stronger growth.

Overall, I think we don't manage this, this is a result of our last year's operations, but you can see our revenue is very diversified in the US, Europe, 80% of revenue, China, Japan another 20% of revenue, and in other than China, every other region grow very well, very well. Investors are already very familiar with our backlog, I think I keep mentioning over the past couple years, our backlog is already so big, it's very, very hard to grow.

Then when you look at from 2020 2022 to 2024, it is true, the backlog barely grew, right, because it's so big. Now as we're signing on more and more large manufacturing projects, the backlog start to grow as well.

We see a service revenue grow by a billion, we see milestone backlog grow by about $4 billion, right? I think it's very healthy growth, that again give us more confidence that we can continuously to deliver high growth.

Our funnel is already have 945 assets, it's almost mimic our industry, but among them, you see bi- and multispecifics grow 30%, you see ADC projects grow 30%. I think if you look at our portfolio now, complex modality is already more than half of the portfolio, and the more complex it is, the higher market share WuXi Biologics has, because it's very hard to handle.

We've got a reputation to be able to handle tough projects in our industry. For traditional mAb, we may have more than a dozen competitors, but once go to bispecific and ADCs, we're becoming a few, only a few competitors, that's why we have a higher market share for those newer modalities.

The complex modality are also much more stickier, I'll explain later on. Which is actually right my next slide.

As bispecifics, multispecifics are actually becoming very, very popular, but we started to work on those projects back in almost 10 years ago. Then so now bi- and multispecific actually [coughs] you can see strong growth in R, D, and M.

On the R side, our CD3 platform now we have close to 20 royalty-bearing projects. On the D part, this is the largest portfolio globally.

On the M part, we actually have three commercial projects, all of them hopefully have a multibillion-dollar potential, right? Development and manufacturing of bispecific actually is very, very hard.

I want to give you one example, right? If you use a 1A1B bispecifics, when you work on the cell line, you potentially get 1A1B, or you can get 2A or 2B, or 2A1B, 2B1A.

If you don't do it well, you're going to get a mess. How do you get the product you want from the mess is actually very, very complicated.

That's why for bispecifics, cell culture is very difficult, cell line is very difficult. You also need to purify the downstream.

When you purify, you also lost the yield. Then what's key is actually you need all the tools to look at it, you need the analytics to look at it.

One analogy what you're looking at, for bispecific, when you look at the commonly available tools, you are only looking at a tip of iceberg, but the bottom, the iceberg under the sea, you need to use a very high-power analytics. Not every company have this power, and WuXi Biologics is actually the best at it.

You need to use a mass spec or very advanced tools to look at this. We actually have a few cases where a large pharma acquire an asset and come to us, we actually found out the company they acquired claim the product is pure with 95% purity.

In our hands, when we use amplifying glass look at iceberg, the company only see the tip of iceberg, we actually see the bottom of it, it's actually only 70% pure, 65% pure. That's how difficult it is for bispecifics.

Because of that, when you have an issue, troubleshooting is also very, very difficult. I mention all those challenges of developing and manufacturing bispecifics, the message is, you see, bispecifics actually is very, very sticky.

Once the project come in, it's very hard for them to leave WuXi Biologics. With that, I'll hand over to our CFO Ming, who will give you an update on the financials for 2025.

Thank you, Chris. Now I'm going to present our financial performance for the fiscal year 2025.

This slide 16 gives us the highlights of our financial performance last year. First, revenue, although there were still tariff and geopolitical uncertainties, and also uneven paces of biotech funding recovery, our revenue continued to grow at an accelerated pace.

As you can see from the chart, that our revenue reached RMB21.8 billion, 16.7% increase over that in 2024. Sequentially, our revenue in the second half was about 18% higher than that in the first half.

We're not just continuing our journey of solid growth over the past 5 years, but also transitioning into a phase of accelerated growth post-COVID. Our revenue increase last year was driven by RDM, all three cylinders.

In R, our research and discovery service segment, we were able to sustain the momentum from the second half of 2024, landing mega deals from our innovative platforms of bispecific, multispecific, and ADC. Overall, upfront payments for our research services more than doubled last year and reached US$115 million, with potentially over $4 billion of the milestone income streams in the future years.

We also have a full pipeline of new deals, the momentum in R will continue into 2026 and also the foreseeable future. On development side, with the tailwind of biotech funding recovery throughout the last year, and also our share gain in the pre-IND space, we achieved a revenue growth about 32% year-over-year thanks to the 209 new projects that we scored last year, among which 186 were in the pre-IND space.

This is a new record representing over 60% of the global presence. Our process optimization and productivity improvement also enabled us to shorten our revenue conversion cycle from DNA to IND to about 6 to 9 months.

The decline in our early phase revenue year-over-year, as Dr. Chen mentioned, is largely due to timing as five large-scale clinical manufacturing projects progressed from Phase 2 to Phase 3, created a gap of about RMB1 billion, which will be replenished by the projects from pre-IND phase over time.

On manufacturing side, with the successful execution of our "Follow and Win the Molecule" strategies, more and more projects were advancing through our funnel towards the later stages. Now we have 74 projects in Phase 3 and 25 at a commercial manufacturing stage.

The volume of these late-stage projects are ramping up steadily with the growth of our clients' drug sales. Overall, late-phase and commercial manufacturing revenue grew over 26% year-over-year and now represented over 43% of our total portfolio during this reporting period.

From a modality perspective, bispecific, multispecific, and ADC contributed half of our overall revenue in 2025. Moving over to gross profit, which increased about 2.3 billion to over RMB10 billion last year.

The whopping 31% increase in gross profit also gave us 500 bps of gross margin expansion year-over-year. The margin improvement was primarily attributed to the following factors.

The first is a solid growth from R, the research sector, which gave us a positive mix impact as the upfront payments and milestone income grew more than 2x during the reporting period. Margin rate for development sector expanded 1 point, largely driven by the productivity improvement and also the higher margins delivered by the complexity of the modalities as bispecific and ADC now represent more than half of our pre-IND portfolio.

At the same time, the profitability from late-phase and manufacturing sector continued to meet or exceed our expectations as the plant utilization rate in China continued to improve throughout 2025, and also our Dundalk, Ireland facility continue its ramp-up journey. The productivity improvement from WBS, our lean manufacturing implementation, also give us 150 bps of the margin lift.

Lastly, SBC, our share-based compensation, decreased 200 million year-over-year as we continued to optimize our C&B structure. This gave us about 150 bps of the GP margin expansion.

Excluding share-based compensation, our adjusted gross profit margin stood at 48.8%, 340 bps improvement year-over-year, one of the leading positions in the global CDMO industry. Adjusted EBITDA, which is a proxy of our operating cash generation capabilities, increased about 22.8% to RMB9.8 billion during the reporting period.

This enabled us to have another phenomenal year from free cash flow generation standpoint. The adjusted EBITDA margin rate also expanded by about 230 bps to 45.1%, one of the highest in the global CDMO industry.

Adjusted net profit is the IFRS-based net profit excluding the impact of foreign exchange gain and loss, share-based compensation, fair value gain and loss from our investment portfolio or asset divestitures, and some one-time restructuring charges. This is the proxy for our business profitability under continuous operations.

As you can see from the chart that our adjusted net profit increased 22% year-over-year to reach 6.6 billion, 5.3 percentage points higher than the rate of the top line growth, which give us a margin expansion of 130 bps to 30.2%. The adjusted net profit margin expansion was largely driven by the solid control in SG&A, partially offset by the tax expense increase year-over-year due to the Pillar Two, the adoption of the 15% minimum tax in Hong Kong, and also the one-time DTA, the deferred tax asset adjustment in Ireland in our 2024 baseline.

Next page, please. This slide shows our profitability growth over the past 5 years, including IFRS-based net profit, net profit attributable to owners of the company, earnings per share, and also adjusted earnings per share.

You can see that all these financial metrics reached record high in 2025. As you can see that our IFRS-based net profit has grown at a CAGR of 27.6% during the past 5 years and exceeded 5.7 billion in 2025.

The 1.8 billion of the 45% growth last year was primarily driven by the 31% increase of the IFRS gross profit, as we discussed earlier, and also the 400 million of the net gain and loss from investment, divestiture, and the foreign exchanges, partially offset by some one-time restructuring charges we took at the end of last year. These gains and also cash inflows from our investment and divestiture activities will give us more dry powder in the future for global capacity expansion, biotech incubating, M&A, or share buybacks.

IFRS net profit attributable to the owners of the company grew by 46% last year, slightly higher than the IFRS-based net profit as both WuXi Biologics and the subsidiary WuXi XDC grew at a similar pace. Hence, the financial impact of the minority interest pickup remains proportional to the net profit growth.

Basic earnings per share grew from 82 to 122 cents per share, 49% increase, 250 bps higher than the growth rate of IFRS net profit attributable to the owners of the company, as we completed our 2-year, $600 million share buyback program in the first half of last year. Our shares outstanding is smaller.

After we exclude the share-based compensation, investment, divestiture gain and losses, FX translation, and one-time restructuring charges, our adjusted EPS stood at 140 cents per share, approximately 20% increase year-over-year. Next page, please, Chris.

This slide gives us more details into our gross profit and the cost components. In fiscal year 2025, our gross profit margin reached 46%, 500 bps expansion from the prior reporting period, a multi-year high post-COVID.

Excluding the 800 million of the share-based compensation, our adjusted gross profit margin was 48.8%, 340 bps improvement year-over-year. In the second half of last year, our adjusted gross profit margin reached 51.5%, another multi-year high post-COVID.

As we discussed earlier, the gross margin expansion was primarily attributed to the takeoff of the research and the discovery services, which give us about 1 point of the favorable mix impact from the upfront and milestone payments, which command 80+% of the gross margin. We gained 150 bps of the margin expansion from WBS, our lean productivity implementation.

The improved capacity expansion in China and also steady ramp-up in Europe also supported the margin growth. You can see the components of the cost elements in the stacked bar below, with roughly 17% in labor, 18% in material, and 19% in overhead, which includes maintenance, utilities, and also depreciation of the manufacturing facilities.

Labor component was about 2 to 3 percentage points lower than our historical average as we focus on labor productivity. Revenue generation per employee is a crucial KPI for all our business units.

In 2025, our total number of the employees only increased about 2%, while our revenue increased 16.7%. The reduction of the share-based compensation expenses also contributed 200 million to the overall labor cost reduction.

Material cost was down 1 point year-over-year, largely due to the material usage productivity improvement. The overhead cost as a component of revenue was down about 2 percentage points compared to the prior two reporting periods.

There were several crosscurrents here. The first, as we expanded our global capacity from 156,000 liters at the beginning of the 2023 to over 300,000 liters at the end of last year, the new capacity brought on more depreciation, utilities, maintenance, and other fixed overhead.

However, as these capacities are ramping up, the revenue generated from the manufacturing sector were growing at 26% last year, a pace that much faster than the increase of depreciation and other overhead expenses. Also, during the last reporting period, as part of our ongoing initiatives to optimize our global manufacturing footprint to improve the return on assets, we divested our vaccine facilities in Ireland and also our DP facility in Germany.

These divestitures also helped us reduce the fixed overhead costs. Next page, please.

Page 19 here is about liquidity. At WuXi Biologics, we have a strong balance sheet and a solid cash position.

As of the end of last year, we had 15.7 billion cash on hand, sufficient funds to support our accelerated growth globally. Compared to the beginning of last year, the overall cash balances increased about 5 billion, among which 2.3 billion were generated from a free cash inflow from the operation cycle.

4.1 billion cash was contributed by our asset optimization and divestiture activities, partially offset by 1.7 billion of the debt reduction and also share buybacks. We always have a conservative funding strategy.

For our RMB64 billion balance sheet, we only have about 1 billion of debt, most of which are working capital facilities. Our gearing ratio, which is defined as the interest-bearing debt over equity, is nearly 2%.

At the same time, we have close to 7 billion of the bank credit facilities to tap into if we need to. Our capex spending last year was about 3.7 billion, mainly for the capacity expansions in Singapore and also in the US.

Subtracting working capital occupation and tax payments, our free cash inflow last year was a whopping 2.3 billion, a new record in our history. This is the fourth year in a row for us to deliver positive free cash flow.

With the acceleration of our capacity expansion in Singapore and the US, and also the 1.5 billion carryover from last year, our estimated capex spending in 2026 will be about 7.1 billion. However, with our operating cash generation capabilities from business growth, and also our focus on working capital management, we are committed to delivering another year with strong positive cash inflow in 2026.

Now I'm going to pass the baton back to Chris to share more insights into our business operations.

Yep, I want to give ever- global investors an update on R, D, and M. I already mentioned bispecifics is a highlight of this presentation.

We started investing traditional mAb disco- on the R on mAb 15 years ago, and 10 years ago we started to work on bispecifics, and then past 5 years we started working on ADCs. You'll see I think this is a very successful story.

We invested a couple billion dollars on the CD3 platform, now the the CD3 platform, the out-licensing of CD3 platform already generated, in the past 5 years already yeah, past past couple years already generated $205 million revenue and then at 85% gross margin. The our partners including company like GSK, Merck, and Vertex.

I think this is incredibly successful story. Not only we this platform investment already generated more than $200 million of revenue and very high profit, we also have $5.2 billion potential milestone that can be achieved in the next couple of months couple of years.

Then for every program using our CD3, we have a 2% to 10% royalties, and then average about 5%. For all those projects, 100% of them 100% of R go into our development, so that carried also carried into about $80 million downstream contract.

I think this is really very good example how the R business can really can helps strong solidify the WuXi Biologics model. That's the CD3 platform I I mentioned is less than a dozen asset.

Overall, we actually have 50 programs like this, right? Again, 15 years ago we start working on mAbs, we accumulate quite some mAbs, and then multispecifics, and then now ADCs.

All those royalty-bearing programs will help improve our margin profile in the years to come. I think this is the first time we want to use one table to share with global investors our the, our business model, our revenue stream is very different from traditional CMO.

Right, if the program started with us with the R, essentially if we are for this client, if we are CRDMO, the economics of of of of WuXi Biologics is actually significantly stronger than any other business model you can see. I'm using a average, a average biologics sales of $1 billion.

Again, if we have 5% royalty, that actually basically means every year, for about 10 years timeframe, we'll get $50 million revenue from this sales royalty alone. Right, and then that's that's the sales royalty from our R.

Then if they manufacture with us, we waive the cell line royalty, but if they don't, we charge the cell line royalty. Then you can look at different scenarios.

The first scenario is 100% volume manufactured with us, right, and we have $50 million revenue from the manufacturing and we also have $50 million revenue from the sales royalty, and it's almost it's the same number. Then with that, we are able to generate a net profit of $53 million for this program alone.

I think that hopefully it's 10 10 years as I said earlier, right? Even if the the manufacturing volume is not 100% with us, is 70%, our profit is actually $50 million.

If if even if all the manufacturing is done somewhere else, but if this is our R, our profit is actually $44 million. If you go to extreme to the to the right side, that's basically means the CMO, if you a pure CMO, with $50 million revenue, your profit is about about $13 million.

$13 million, right? I think that's that's really the show how our business model is very different.

The CRDMO profitability is about four times the traditional CMO profit profitability. I I want to even go to extreme case, if we if we they use our cell line, if we do not manufacture at all, we still have about $5 million cell line royalty and with a $4 million profit.

That's basically means, if someone else do the manufacturing, I don't do anything, but I have 30% of profit of the CMO. That really I think this table, if you study this table, really showcase how how different our business model is.

With the R, I can generate three to four times more profit than the traditional CMO. With the D, even if we don't manufacture anything, we can generate 30% of net profit.

Certainly we want we want our M to be big, we want our M to grow as well. I think that's why this slide really showcase our strong business model and the strong a very unique business model, CRDMO.

Right, so that's a very quick update on our R. On D, I think that's our that's really the strength of the company.

Far, we have delivered more than 786 INDs by end of last year. Last year we delivered record high 156 INDs.

Then among them, 38 projects were delivered at a 6 months timeline. Just to give you context, most of our peers deliver projects at 10 to 12 months timeline, we are almost twice as the fast as our peers, as our competitors.

I was always joking with biotech CEO, I said, if if we deliver a 6-month project for you and if they usually pay me $6 to $8 million to deliver to IND, but I save them 6 months, if their burn rate is $2 million a month, I save them 12 million while they only pay me $6 to $8 million. I think that's how WuXi can help the biotech community.

That's why that's why biotech companies prefer WuXi as a partner of choice. Right, so as a result of the recent growth, now we have already increased our capacity to handle 200 INDs a year and 20 product filings.

Look if you look at the bottom right chart, when we IPO'd, we can only deliver 20 INDs a year. Last year we deliver 156.

This year we'll deliver 180, a 9x increase in the past couple of years. I think that's an update on D.

On manufacturing, everyone know our manufacturing is excellent, right, we have very strong track record. If you manufacture with us, it's almost a guarantee.

If we say we're going to deliver material to you by Christmas, we'll deliver to you material to you by Christmas. It's like a buying an insurance.

That's our manufacturing. One prerequisite or leading indicator of bio-manufacturing, commercial manufacturing is the PPQ.

That's the step, essentially you do PPQ, you file to FDA, and then when FDA approve, it begins selling the product. Right, on the left side, you see the PPQ growth.

In 2019, we only have six projects. I think by end of this year, we'll have more than 137.

I think this is based on the contract we sign as of as of today, most likely this year will even be higher. If you look at 137, you may think this is just a pure number, but for one for every successful PPQ, potentially potentially for 20 years, that can generate for a reasonably for a reasonable biologics with $3 billion sales, one PPQ can generate the future potential of $3 billion in 20 years.

I assume, $1 to $3 billion drug, and then the manufacturing, and then if you look at 20 years, is actually a three a $3 billion potential. That's so I have 133 of 137 of them, and then if you adjust for industry failure rate, if you adjust for someone else taking it home, adjust for all these variables, this 170 137 PPQ means cumulative revenue potential of $75 billion in 20 years.

On average, about $3.7 billion revenue. That's how powerful this 137 is.

$3.7 billion revenue, what does that mean? That means another WuXi Biologics 2025 revenue.

In this PPQ alone, you can actually see for the next 20 for for 20 years, every year we may have $3.7 billion revenue, and that's how powerful it is, this PPQ number. On the right side, you see, before COVID, we do about only a couple of PPQs, and during COVID, we getting to about 10 range.

Now this year we're getting to 30s. Right, if you look at the the blue and green color, that's the global clients, mostly US clients.

You see we we have 10 PPQ in 2014, 20 in 2025, and 30+ this year. That's again, 2-year 3x growth, 3x.

That's that's really the number of PPQs we're doing. This all those bode well for our commercial manufacturing revenue down the road.

I think what the reason why companies love us on the why do why do they want us to do PPQ for them, because as I mentioned earlier, our PPQ is 100% success. When they file the PPQ to the agency, we hope it's also 100% approval, 100% success and in approval as well.

That's why global companies trusted WuXi on not only in the RD phase, but also now more and more in manufacturing. I think we Dr.

Ming already mentioned that we have a WPS effort, and digital is another effort. Through WPS and digital, WuXi Biologics will continue to continue to innovate, continue to improve our efficiency, you will see our our our efficiency improvement year-over-year.

As as the the the business grow, we are also investing more and more in the global, and we are investing in US, investing in Singapore, in we're finishing investment in Ireland. We're also looking at the Qatar, but now because of the war, we will re-evaluate after the war.

Qatar right now is on hold, we'll re-evaluate after the war. The the US investment is in two mostly two locations, one is Cranbury, New Jersey, right by Princeton, and then we converted a small clinical facility into commercial facility because of demand, and we're building a much bigger commercial manufacturing facility in Worcester, Massachusetts.

When all those facilities online, we can generate we can generate hundreds of million revenue in the US. I think every time when I meet investors, I really want to share with you what's exciting about WuXi Biologics on technology side.

We are we have very strong execution track record, we have very high quality, we have fastest speed, but we also have one of the best technology platforms. I already mentioned over and over again the bispecific platform, the CD3 platform, right?

We also have a nanobody platform called Starbody. Today I want to highlight a few ADC-related technologies that WuXi Biologics are working with WuXi XDC to develop for the global community.

The first program is actually called WuXiDARx. This is a site-specific conjugation technology using elegant chemistry.

If you look at the global community, a lot of people are doing conjugation using very sophisticated tools, a lot of very complex enzymes, very very you have to engineer the antibody to create a a mutation for the antibody, and that will change the antibody properties as well. We actually only use elegant chemistry, were able to do a site-specific conjugation using elegant chemistry.

Not only this technology can be used for traditional ADC, we can actually use for dual payload ADC. We can put four payload 1 first and then put another four payload 2, or we can put on the right side we can put four payload 1, two payload 2, six payload 1, two two payload 2.

I think this give a global community a lot of options on developing next-generation dual dual-payload ADCs. We believe this will be start of earning milestone and royalties for WuXi XDC.

Similarly, WuXi XDC had developed a propriety proprietary linker technology and also proprietary payload as well. I think, between the conjugation and the payload and linker, and then with all the WuXi's mAb, we can create next-generation ADCs for the global community.

That's why I said, 15 years ago we start working on mAbs for the global community on R, and then 10 years ago we start working on bispecific and multispecifics, 5 years ago we start working on ADCs. You will see more and more milestone payment and and royalties, upfront payment, milestone, and royalties from the ADC technology as well.

That's a new offering on the R side. On the D side, you know we are D is the workhorse of the company, more than 50% of revenue come from D.

The evolution of technology from D is also very, very obvious. 15 years ago when the company started, we use what they call random integration technology.

Random integration means because it's random, it's lower productivity. So 15 years ago we we have to look at 3,000 cells, it take us 6 months, and in the end, we can produce 2 g/L.

The technology we we have right now, we just launched last September, is called targeted integration. You may not know the details, but it doesn't matter, look at the results.

We only look at 1% of the cell comparing to 15 years ago, less than 30 cells. We with the timeline reduced by more than half, instead of 6 months, now it's 2 and 1/2 months.

We get four times more productivity. This technology can help our industry reduce the cost of goods by 30% with this technology.

We have, this technology was only launched last September, now we will have already have 50 projects using this. Our first IND filing with FDA is the next couple of months.

Once FDA approves this, I think we're going to use it for every project from WuXi Biologics. Again, this will help our clients save 30% of the cost of goods eventually down the road.

I think this this is again show how WuXi Biologics, we are working on the we are we're innovating every step, trying to make the drug manufacturing process, the biologics manufacturing process more efficient, lower cost. I think this is really beneficial for the industry.

With this technology, we can as I said earlier, last year we delivered 38 INDs in 6 months, with this technology, we may be able to deliver 100 INDs in 6 months, because every project will be saved by at least a month in there. Again, I can make industry faster and faster, and better and better, and cost of goods cheaper and cheaper.

Another aspect of this technology is we are we will be using this technology to make a lot more biosimilars. Biosimilars, cost of goods is hugely is important.

As I said, with this technology, I can save the industry by 30%, why not work on biosimilars? We have we have already many, many biosimilar companies come to WuXi want to use this technology and eventually help them reduce cost of goods, help them improve the sales.

Now, from the get-go, WuXi Biologics, our manufacturing platform is disposable. In 10 years ago, single disposable reactor is 2k, now we have go to 4k, go to 5k, and in our in our Worcester site will be 6k.

Reactor getting bigger and bigger, but people always challenge me, if I have a blockbuster, how can you do it? We have already proven 352 352 times I can do it for you.

The men each reactor is getting bigger and bigger, we can also multiplex. The largest scale we run in China now is 16,000-liter scale.

That's bigger than most of the stainless steel facility out there, right? Most of the stainless steel tanks are 10, 12k, even 15k, but we can actually run 16k by multiplexing four of 4k reactors.

In Worcester, Massachusetts or in Singapore, our single reactor is already 6k. I can do three 6k, become 18,000-liter reactors.

I think as I mentioned earlier, our cell line productivity is higher, we may not need to go to that scale, but if I need to, I can do, very large-scale manufacturing. The cost of goods is very comparable to traditional stainless steel.

We have already proven proven this 352 times. As our industry move to more and more patient convenience, a new technology is needed, what they call high-dose delivery.

Traditionally with a subQ injection, you can only do 1 mil. How do you how do you pack more product into that 1 mil?

It's called we use the technology called WuXi High. I can put, as as much as 240 mg of of materials into that 1 mil.

If you look at if you are interested in biologics, most of the biologics are 30, 50 mg/mL, I basically I can pack 8 to 10 times more into that 1 mil. That's why patients can do can do that injection themselves, or nurse can do it in a few minutes instead of a few hours of IV.

That's the WuXi High. This is also a technology that we collect milestone payment and potentially royalties from global community.

The other one is called Hylapease. Essentially it's an enzyme that can dissolve some tissue and can help you get do a large volume, you can as big as 20 mil.

I think this is technology readily available in the industry, but now we are doing a biosimilar version of it. I think I think we already have many projects that's working on that.

I think WuXi, from WuXi's perspective, I want to make sure we help our clients. Whatever they need, I have them for you.

That's the technology development that we have. That that's the two technology I want to highlight.

I think Ming already mentioned the WuXi Biologics Business System. It's our way of continuous improvement.

Every year we'll look at how can we save costs there, how can we more be more efficient in labor, how can we save materials, how can we save expenses, how can we optimize ESG, and how can we past past couple years, how can we increase our revenue? I think all those are the WuXi Business System.

Last year we did a 400 project more than 400 Kaizen projects. Overall, the business results is actually impressive, right, we achieved 150 bps improvement in margin.

I think this will a continuous effort. This is already year five of us implementing WBS, we'll continue to do that.

Also very proud of our ESG result. Every year we got now we get highest rating almost from every agency, from top 1% on quite a few of them, AAA in remaining remaining rating agencies.

I think that's a high-level summary that I wanted to share with the global community. I think in the end, I still want to share with you that I truly believe our business model is very unique.

With the revenue with the royalty calculation slide, you can see our revenue a profit our revenue model, our profit model is very different. Our business model is very different.

RDM, we strongly believe R will lead to D, D will lead to M. Essentially everything coming to our funnel will stay there.

Right, almost everything will come into funnel will stay there. Our R is very unique, give us not only a very high margin business, but also will lead to D and lead to M.

Right, I think for R, 15 years ago worked on mAbs, 10 years ago worked on bispecifics, now we're working on ADCs. We are we are answering to the need of a global biotech community.

On D is the workhorse of the company, right, we have delivered 38 projects at the record 6-month timeline. This year we'll probably deliver a lot more.

We help company save money by doing 100% success and delivering project in the fastest manner. In M, I think we we already have a near a decade of large-scale manufacturing experience, right, we can really cater to the clients' need.

In our portfolio now we counted many, many blockbusters. About more than 10 programs with $5 billion sales potential, and more than 20 programs with a billion-dollar sales potential.

That will drive our M. I shared this slide during J.P.

Morgan conference already. I think, WuXi Biologics, the next next couple years will benefit from the three high-growth modalities.

I already mentioned bi- and multispecifics, right, were mentioned in the in the other previous slide. Bi- and multispecifics grow actually 120% revenue for us last year.

Now it's almost 20% of our group revenue. It's come is is getting close to the 30% ADC contribute.

There are two type of bispecifics: one is CD3-enabled enabled, and CD3-19, 20, PMSA, 19, 20, or 19 BCMA. All those programs could potentially generate, each each one of the drug could be 5 billion, sometimes even $10 billion sales.

Certainly our industry is very, very chasing after the PD-1/VEGF VEGF, but there are many other dual model bi- dual-target bispecifics, WuXi will benefit from all of those. Some of those are very high volume, multi-metric ton scale manufacturing, and WuXi will benefit.

ADCs, you have I'm sure you have heard about from XDC talk, right? It's 30% of revenue and we have quite a few programs pending approval, and we're all the emergency ADCs as the B7-H3, DLL3, ROR1, Claudin 18.2, Claudin 6.

Tomorrow if you hear a good news on a bispecific or ADC, 50% chance WuXi Biologics is behind them. Uh 5 years from now, 70% chance WuXi Biologics is behind them.

That's how much contribution we made to the global community on bispecific and ADCs. We have been already working on mAbs for 10 years, now we have many programs that's getting to a close to commercial stage: so the FcR FcRn antibody, IGF-1R antibody, CD19 antibody, C1 antibody, program for IgA disease, program for autoimmune allergic reaction.

Again, in those portfolio, we can count on many programs will require much multiple metric ton of manufacturing. That correspond to $100 million, $200 million, $300 million $300 million of revenue for WuXi Biologics.

That's why I I believe, our business model will our business will continue to grow. Oftentimes, investors ask me, what's your near-term potential?

What's your margin look like in 2028 2028, 2029, which is 2 to 3 years from now? I I I'm very happy, actually second half of last year, we already delivered the 2028, 2029-like margin profile.

Right, if you see la- the second half of last year, our R is incredibly strong, our D is incredibly strong, our M are are the strongest also the in the in the past 5 years in the past 3 years. That's why we're able to deliver a gross margin of about 48%, adjusted gross profit margin almost 52%, and adjusted net profit margin of 32%.

That's really the sort of the the near-term margin potential of the company. With that, I want to summarize 2025.

Again, we have an incredible 2025, you'll see. Bi- and multispecific grows, you see ADC grows, right?

You continue to see us investing new technology, I mentioned the cell line and the high-concentrate formulation. R, D, and M all shine last year.

The momentum continue to shine. I think this 2026, momentum will continue to to shine.

We'll continue to see RDMM. Our R is, our CD3 even more proven.

We sign 209 projects, most of them will be translated into revenue in D this year. I mentioned we have 10 programs with $5 billion potential, with another 10 programs with at least a billion-dollar potential.

We have 20 blockbusters waiting for us to to to manufacture, and we have 35 PPQs based on based on the January data. Hopefully by this time next year, we'll report to you actually more than 30 34 PPQ.

The business momentum Q1 of this year is continue to be very, very strong. If you look in in inside, I see our business growing very, very well.

Outside, the two war going on, we're not sure how how Fed is going to do on interest rate, and also the RMB versus US exchange rate give us some some volatility. Because of that, we want to be conservative, we'll we want to guide a revenue growth of 13% to 17%, taking into account the RX RMB to US dollar fluctuation, taking into account some potential challenges in in in biotech funding because because of the war, because of the funding situation.

I I think, this is still decent growth, we certainly wanted to underpromise, overdeliver. I think that, it will be another great year in 2026.

Thank you.

Thank you very much, Dr. Chen and Mr.

Tu, for a wonderful presentation, and once again congrats on a strong 2025. We will now move to the Q&A session.

For sell-side analysts and investors, to ask a question, please type into the Q&A box at the bottom of your Zoom screen. You can also send me your questions at [email protected].

We have two questions coming from Alessandra David from the Ashmore Group in the US. Let me go one by one.

Chris, you sort of alluded to it on the guidance slide, but at the J.P. Morgan conference, you guided for soft acceleration year-on-year, and it was later confirmed to be 13% to 17% year-over-year, can you comment on the reason for the change?

It's mostly the currency. Mostly is the currency, right?

Because this year we have already seen fairly volatile RMB to US dollar exchange. That's why I want to be conservative.

We're baking quite some room for this, yeah. Also

the volatility in biotech funding you mentioned, right? Two two

That's secondary, yeah.

Far biotech funding has been strong, we only saw 2 months of data, right? There's a lot of uncertainty this year in the macro background, we want to be conservative.

Thanks Chris and Lina. His second question is there's a slowdown in China revenue, or flat when you strip out the out-licensing deals, can you comment on the onshore biotech funding environment?

I think biotech funding may not be that strong, but there are a lot of deal activities and some IPO, because of that, I think funding in China is okay, yeah. Funding in China so far is okay.

Next, we have two questions coming from Chris Tan representing Ziyi's team at Goldman Sachs. Firstly, can you comment on the capacity ramp in China versus overseas?

Because our manufacturing is already so big, we don't comment on specific site, but the overall manufacturing utilization improved by a few percentage, that's why last year margin was expanding. That's why second half of last year I mentioned you can see this margin at 2028 because every year we improve our efficiency, second half of last year is very evident, yeah.

Okay. Next, we have a question coming from Linda Xu at HSBC: with increasing proportion of new modalities and the progress of clinical trials and commercialization, could you give us the outlook of the IP-based revenue growth in this year and next year?

That's great, I think the IP-based sort of the upfront payment, right, milestone payment kind of the income is actually very hard to predict. Last year was almost about 15% of our profit as well.

I think as a rule of thumb, we want to guide you is basically saying we'll see a 30% CAGR, right? Last year we see a very strong growth, is almost a 50%, but overall because it's so unpredictable, we still want to guide you at a 30% CAGR in 5 years.

This was still very strong revenue and profit component. Any other question?

Okay. Next, we have a question coming from Vicky Ju on the buy side: can you comment on the contract pricing trend?

I think overall the contract pricing is very stable, and in the beginning of the year, we actually raised the price by about 5% to 10%. Because I think we see the global demand, I think global CPI adjustment is actually very reasonable in our community,

yeah. In line with inflation, basically.

Yeah.

Okay. Next we have a question coming from Huang Yang at J.P.

Morgan: Chris, you mentioned there are a number of M programs with peak sale potential of $5 billion. Can you let us know how long those drugs have been on the market?

We would also like to get a sense of when we can see those drugs reach peak sales.

That's a good question. Far, we have, we we're among the 25, we see two of them.

Among the 25 approved, we see two of them, but the other program are still in Phase 3, they're not approved yet. For two of them, one of them hopefully be receiving achieving $5 billion of sales very soon.

The other one hopefully in the next couple of years. That's our business model.

Our business model basically, we we work with the client and their program need to go from $1 sales to $1 billion to $5 billion, it takes some time. That's that's so our business model is not as straightforward as a straight CMO where you can do a $50, $100 million revenue per project, right away.

I think that's a business that's our business model. We we grow up with our client.

The good thing is our revenue, will our M revenue will continue to grow, right? If you as a straight CMO, year after year, at some point your revenue will decline.

For us, our revenue our M revenue will our M revenue for every program will increase, and then will reach a peak, and then will decline. Our that that that cycle is actually 10, 15 years, or even 15, 20 years.

We are at the beginning of that 15, 20-year ramp-up, that's why I said our M revenue will continue to grow. For the multi- multiple $5 billion drug, two of them already approved, one of them is already on the market a couple of years, one of them is only 2 years.

The next question comes from Hugh Sloan on the buy side: would the company do more buybacks? Because

we have very strong cash situation, as you look at our capex, we're investing heavily, we are also potentially doing more M&As, you already seen one M&A from XDC. We're looking at all the options, and then buyback is certainly one of the ways to reward investors.

Okay. The next question comes from Zhang Jialin at Nomura: so what is the rate of the company retaining Chinese firms' projects if they were out-licensed to MNCs?

What is the current market share based on your knowledge?

For the programs that Chinese company partner with global, essentially Chinese company out-license to global, if they use CMO, we have 70% market share. Then every company who acquired the asset actually keep the project with us, we have 100% retention of the program.

As I said in the earlier slide, when I mentioned 90 program was acquired, and then they add 30 program, that include Chinese company program being acquired by global company. Instead of moving away from WuXi, actually they always so far 100% project get kept at WuXi.

In the meantime, they actually give us more projects. It's actually net even surplus.

Not only there is no project transfer out of WuXi, instead, they actually give us more projects.

The next question comes from Jason Li: there's been an increased focus on AI and how it could impact pharma R&D outsourcing as AI gets more advanced. What is your view on the impact of AI and if it could decrease pharma R&D outsourcing?

I think it's actually probably the other way around. AI will make more and more outsource, right?

Our business model is very complex, I want to explain R, D, and M. For R, AI can make R more efficient, and if that's the case, if R is more efficient, that basically means there will be more and more D and M.

WuXi Biologics will benefit from that AI, right, because if the R is easier, every company can create 50 projects, who can handle that 50 new projects? Only WuXi Biologics have the capacity and bandwidth to handle that.

Our D and M will benefit from that. On the R side, so far I don't see a disruption of AI in disrupting R yet, our R will continue to benefit.

Behind the scene, we actually use AI in every part of our business already. The reason we are so fast in D, the reason we are so good in M, is because AI is already part of our process.

In the R side, we already develop quite a few molecules with traditional technology cannot develop, basically a wet lab, you cannot create a drug, but with AI, we're able to create that drug. It's not from first principle, it's not from in silico, it's basically we use wet lab to create a molecule, they're non-ideal, and then we use AI to fine-tune the molecule, make it ideal.

Okay. We are actually almost at the time limit now, I will turn it back to Chris to do concluding remarks.

Chris?

Yep, thank you Lawrence, again. Right, if you look at 2025, almost every metrics record high, revenue, profit, free cash flow.

I think 2026, we hope we'll see similar, everything will be record high, but the growth we want to be confident we can deliver the revenue growth, that's why we factored in some variances of currency variability, that's why we give you a range of growth of 13% to 17%, but we hope we can do better than this. Thanks to global investors' support.

Thank you.

Thanks again, Chris. This will conclude the call for WuXi Biologics 2025 result.

Thank you all.