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Segment Information | 3 Months Ended
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Mar. 31, 2025
Segment Reporting [Abstract] |
Segment Information |
16. | Segment Information
The Company is a consolidated entity comprised of two distinct operating segments: Gyre Pharmaceuticals and Gyre after the Contributions. The Company’s reportable segments are based upon internal organizational structure, the manner in which operations are managed, the criteria used by the CODM to evaluate segment performance, the availability of separate financial information, and overall materiality considerations. All Gyre’s operations are within the U.S., while all of Gyre Pharmaceuticals’ operations are in mainland China. Gyre Pharmaceuticals Gyre Pharmaceuticals has one major commercial drug product, ETUARY, and several product candidates in pre-clinical and clinical development. Gyre Pharmaceuticals’ product revenues are mainly generated from the sale of ETUARY and certain generic drugs. Gyre Pharmaceuticals primarily sells its pharmaceutical products to distributors in the PRC, who ultimately sell the products to hospitals, other medical institutions and pharmacies. Gyre Gyre is a biopharmaceutical company focused on the development and commercialization of F351 for the treatment of MASH-associated liver fibrosis in the United States. Other than the IP associated with F351 in the U.S., Gyre has no other product candidates since the Company sold all of its legacy IP assets prior to the closing of the Contributions. Subsequent to the closing of the Contributions, Gyre has not generated any revenue. Other Other represents the financial information from other subsidiaries, consisting of mainly CPI, GNI HK, and Continent Pharmaceuticals U.S., Inc. During the year ended December 31, 2023, prior to the Contributions, CPI divested almost all of its assets other than its 56.0% indirect ownership interest in Gyre Pharmaceuticals (see Note 8 — Restructuring in the Annual Report). Segment information for the three months ended March 31, 2025 and 2024 is as follows (in thousands):
|  | Three Months Ended March 31, 2025 |
|  | Gyre Pharmaceuticals |  |  | Gyre |  |  | Other |  |  | Consolidated |
Revenues |  | $ | 22,058 |  |  | $ | — |  |  | $ | — |  |  | $ | 22,058 |
Cost of revenues |  |  | 894 |  |  |  | — |  |  |  | — |  |  |  | 894 |
Gross profit |  |  | 21,164 |  |  |  | — |  |  |  | — |  |  |  | 21,164 |
Operating expenses excluding cost of revenues: |  |  |  |  |  |  |  |  |  |  |  |
Selling and marketing |  |  | 10,841 |  |  |  | — |  |  |  | — |  |  |  | 10,841 |
Research and development |  |  | 3,029 |  |  |  | 66 |  |  |  | — |  |  |  | 3,095 |
General and administrative |  |  | 3,556 |  |  |  | 1,396 |  |  |  | 3 |  |  |  | 4,955 |
Total operating expenses excluding cost of revenues |  |  | 17,426 |  |  |  | 1,462 |  |  |  | 3 |  |  |  | 18,891 |
Income (loss) from operations |  |  | 3,738 |  |  |  | (1,462 | ) |  |  | (3 | ) |  |  | 2,273 |
Change in fair value of warrant liability |  |  | — |  |  |  | 2,255 |  |  |  | — |  |  |  | 2,255 |
Other income, net |  |  | 62 |  |  |  | 45 |  |  |  | — |  |  |  | 107 |
Income tax expense |  |  | (901 | ) |  |  | — |  |  |  | — |  |  |  | (901 | )
Net income (loss) |  | $ | 2,899 |  |  | $ | 838 |  |  | $ | (3 | ) |  | $ | 3,734 |
Supplemental disclosure of stock-based compensation expense: |  |  |  |  |  |  |  |  |  |  |  |
General and administrative |  | $ | 78 |  |  | $ | 429 |  |  | $ | — |  |  | $ | 507 |
Stock-based compensation total |  | $ | 78 |  |  | $ | 429 |  |  | $ | — |  |  | $ | 507 |
|  | Three Months Ended March 31, 2024 |
|  | Gyre Pharmaceuticals |  |  | Gyre |  |  | Other |  |  | Consolidated |
Revenues |  | $ | 27,172 |  |  | $ | — |  |  | $ | — |  |  | $ | 27,172 |
Cost of revenues |  |  | 979 |  |  |  | — |  |  |  | — |  |  |  | 979 |
Gross profit |  |  | 26,193 |  |  |  | — |  |  |  | — |  |  |  | 26,193 |
Operating expenses excluding cost of revenues: |  |  |  |  |  |  |  |  |  |  |  |
Selling and marketing |  |  | 12,542 |  |  |  | — |  |  |  | — |  |  |  | 12,542 |
Research and development |  |  | 2,009 |  |  |  | 173 |  |  |  | — |  |  |  | 2,182 |
General and administrative |  |  | 2,257 |  |  |  | 1,141 |  |  |  | — |  |  |  | 3,398 |
Total operating expenses excluding cost of revenues |  |  | 16,808 |  |  |  | 1,314 |  |  |  | — |  |  |  | 18,122 |
Income (loss) from operations |  |  | 9,385 |  |  |  | (1,314 | ) |  |  | — |  |  |  | 8,071 |
Change in fair value of warrant liability |  |  | — |  |  |  | 4,288 |  |  |  | — |  |  |  | 4,288 |
Other income, net |  |  | 62 |  |  |  | 60 |  |  |  | — |  |  |  | 122 |
Income tax expense |  |  | (2,546 | ) |  |  | — |  |  |  | — |  |  |  | (2,546 | )
Net income |  | $ | 6,901 |  |  | $ | 3,034 |  |  | $ | — |  |  | $ | 9,935 |
Supplemental disclosure of stock-based compensation expense: |  |  |  |  |  |  |  |  |  |  |  |
General and administrative |  | $ | — |  |  | $ | 11 |  |  | $ | — |  |  | $ | 11 |
Stock-based compensation total |  | $ | — |  |  | $ | 11 |  |  | $ | — |  |  | $ | 11 |
The table below presents total assets as of March 31, 2025 and December 31, 2024.
|  | March 31, 2025 |
|  | Gyre Pharmaceuticals |  |  | Gyre |  |  | Other |  |  | Consolidated |
Total assets |  | $ | 122,351 |  |  | $ | 7,074 |  |  | $ | 365 |  |  | $ | 129,790 |
|  | December 31, 2024 |
|  | Gyre Pharmaceuticals |  |  | Gyre |  |  | Other |  |  | Consolidated |
Total assets |  | $ | 114,248 |  |  | $ | 10,790 |  |  | $ | 368 |  |  | $ | 125,406 |
The table below only includes cash outflows for the purchase of property and equipment and excludes non-cash activities.
|  | Three Months Ended March 31, 2025 |
|  | Gyre Pharmaceuticals |  |  | Gyre |  |  | Other |  |  | Consolidated |
Purchase of property and equipment |  | $ | 122 |  |  | $ | — |  |  | $ | — |  |  | $ | 122 |
|  | Three Months Ended March 31, 2024 |
|  | Gyre Pharmaceuticals |  |  | Gyre |  |  | Other |  |  | Consolidated |
Purchase of property and equipment |  | $ | 217 |  |  | $ | 14 |  |  | $ | — |  |  | $ | 231 |

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