Balance Sheet Components

12 Months Ended

Dec. 31, 2024

Balance Sheet Related Disclosures [Abstract]


4.	Balance Sheet Components

Inventories, net

Inventories, net of reserves of $4,000 and $46,000 as of December 31, 2024 and 2023, respectively, consisted of the following components (in thousands):


	December 31,
	2024		2023
Raw materials	$	794	$	919
Work in progress		2,929		1,997
Finished goods		2,614		1,365
Inventories, net	$	6,337	$	4,281

The provision for inventory and write-downs for the years ended December 31, 2024 and 2023 were immaterial.

Accrued expenses and other current liabilities

Accrued expenses and other liabilities consist of the following (in thousands):


	December 31,
	2024		2023
Accrued payroll and welfare	$	4,765	$	5,790
Payable to PPE suppliers		1,219		1,336
Accrued expenses - general and administrative		1,005		1,190
Accrued sales discount		908		903
Payable to selling expense suppliers		900		820
Employee reimbursement		737		648
Accrued professional services		667		837
Deferred government grants		95		40
Accrued expenses - research and development		57		161
Other accrued liabilities		262		210
Accrued expenses and other current liabilities	$	10,615	$	11,935

Deferred government grants

Deferred government grants represent funds provided by the government for research and development, construction of new facilities, or improvement of existing production facilities. The amount of deferred government grants as of December 31, 2024 and 2023, is net of the amount recognized as government grant income. During the years ended December 31, 2024 and 2023, the Company received $0.9 million and $1.1 million government grants, respectively. During the years ended December 31, 2024 and 2023, the Company

recognized $0.1 million and $1.0 million of government grant income within other income in the consolidated statements of operations and comprehensive income (loss), respectively.

Summarized below are deferred government grants as of December 31, 2024 and 2023 (in thousands):


	December 31,
	2024		2023
Government grants for property and equipment, included in accrued expenses and other current liabilities	$	95	$	40
Current deferred government grants		95		40
Government grants for property and equipment		928		213
Non-current deferred government grants		928		213
Total deferred government grants	$	1,023	$	253

Property and equipment, net

Property and equipment, net consisted of the following (in thousands):


	December 31,
	2024			2023
Buildings	$	18,980		$	12,289
Construction in progress		222			7,875
Machinery and electronic devices		9,442			6,598
Furniture and fixtures		653			606
Motor vehicles		182			185
Property and equipment, gross		29,479			27,553
Less: Accumulated depreciation		(5,599	)		(4,265	)
Property and equipment, net	$	23,880		$	23,288

Depreciation expense was $1.3 million and $1.0 million for each of the years ended December 31, 2024 and 2023, respectively.

Long-Term Investment Measured Under Equity Method

On June 28, 2024, Gyre Pharmaceuticals entered into a partnership agreement as a limited partner with other investors and is obligated to pay $4.2 million for an 18.93% equity interest in the partnership. Pursuant to the partnership agreement, Gyre Pharmaceuticals, as a limited partner, shall not participate in any activities related to the management of the investment business. However, Gyre Pharmaceuticals may appoint a member to the advisory committee of the partnership. As of December 31, 2024, the Company's total investment into the partnership and the carrying value of the Company’s long-term investment in this affiliate, which was included in “Other assets, noncurrent” in the balance sheet, was $1.7 million and $1.6 million, respectively.