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Segment Information
 6 Months Ended
Jun. 30, 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 United States, while all of Gyre Pharmaceuticals’ operations are in mainland China.

 

Gyre Pharmaceuticals

 

Gyre Pharmaceuticals has three major commercial drug products—ETUARY®, Etorel, and Contiva—as well as several product candidates in pre-clinical and clinical development. Gyre Pharmaceuticals’ product revenues are mainly generated from the sale of ETUARY®, Etorel, Contiva, 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 Hydronidone for the treatment of MASH-associated liver fibrosis in the United States. Other than the IP associated with Hydronidone in the United States, Gyre has had 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 and six months ended June 30, 2025 and 2024 is as follows (in thousands):

 

 

 

Three Months Ended June 30, 2025

 

 

 

Gyre Pharmaceuticals

 

 

Gyre

 

 

Other

 

 

Consolidated

 

Revenues

 

$

26,771

 

 

$

—

 

 

$

—

 

 

$

26,771

 

Cost of revenues

 

 

1,151

 

 

 

—

 

 

 

—

 

 

 

1,151

 

Gross profit

 

 

25,620

 

 

 

—

 

 

 

—

 

 

 

25,620

 

Operating expenses excluding cost of revenues:

 

 

 

 

 

 

 

 

 

 

 

 

Selling and marketing

 

 

15,194

 

 

 

—

 

 

 

—

 

 

 

15,194

 

Research and development

 

 

3,337

 

 

 

88

 

 

 

—

 

 

 

3,425

 

General and administrative

 

 

2,857

 

 

 

1,970

 

 

 

2

 

 

 

4,829

 

Loss on disposal of assets, net

 

 

1

 

 

 

—

 

 

 

—

 

 

 

1

 

Total operating expenses excluding cost of revenues

 

 

21,389

 

 

 

2,058

 

 

 

2

 

 

 

23,449

 

Income (loss) from operations

 

 

4,231

 

 

 

(2,058

)

 

 

(2

)

 

 

2,171

 

Other (expense) income, net

 

 

(237

)

 

 

92

 

 

 

—

 

 

 

(145

)

Change in fair value of warrant liability

 

 

—

 

 

 

212

 

 

 

—

 

 

 

212

 

Income tax expense

 

 

(662

)

 

 

—

 

 

 

—

 

 

 

(662

)

Net income (loss)

 

$

3,332

 

 

$

(1,754

)

 

$

(2

)

 

$

1,576

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Supplemental disclosure of stock-based compensation expense:

 

 

 

 

 

 

 

 

 

 

 

 

Cost of revenue

 

$

47

 

 

$

—

 

 

$

—

 

 

$

47

 

Selling and marketing

 

 

29

 

 

 

—

 

 

 

—

 

 

 

29

 

General and administrative

 

 

273

 

 

 

557

 

 

 

—

 

 

 

830

 

Stock-based compensation total

 

$

349

 

 

$

557

 

 

$

—

 

 

$

906

 

 

 

 

Six Months Ended June 30, 2025

 

 

 

Gyre Pharmaceuticals

 

 

Gyre

 

 

Other

 

 

Consolidated

 

Revenues

 

$

48,829

 

 

$

—

 

 

$

—

 

 

$

48,829

 

Cost of revenues

 

 

2,045

 

 

 

—

 

 

 

—

 

 

 

2,045

 

Gross profit

 

 

46,784

 

 

 

—

 

 

 

—

 

 

 

46,784

 

Operating expenses excluding cost of revenues:

 

 

 

 

 

 

 

 

 

 

 

 

Selling and marketing

 

 

26,035

 

 

 

—

 

 

 

—

 

 

 

26,035

 

Research and development

 

 

6,366

 

 

 

154

 

 

 

—

 

 

 

6,520

 

General and administrative

 

 

6,413

 

 

 

3,366

 

 

 

5

 

 

 

9,784

 

Loss on disposal of assets, net

 

 

1

 

 

 

—

 

 

 

—

 

 

 

1

 

Total operating expenses excluding cost of revenues

 

 

38,815

 

 

 

3,520

 

 

 

5

 

 

 

42,340

 

Income (loss) from operations

 

 

7,969

 

 

 

(3,520

)

 

 

(5

)

 

 

4,444

 

Other (expense) income, net

 

 

(175

)

 

 

137

 

 

 

—

 

 

 

(38

)

Change in fair value of warrant liability

 

 

—

 

 

 

2,467

 

 

 

—

 

 

 

2,467

 

Income tax expense

 

 

(1,563

)

 

 

—

 

 

 

—

 

 

 

(1,563

)

Net income (loss)

 

$

6,231

 

 

$

(916

)

 

$

(5

)

 

$

5,310

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Supplemental disclosure of stock-based compensation expense:

 

 

 

 

 

 

 

 

 

 

 

 

Cost of revenue

 

$

47

 

 

$

—

 

 

$

—

 

 

$

47

 

Selling and marketing

 

 

29

 

 

 

—

 

 

 

—

 

 

 

29

 

General and administrative

 

 

351

 

 

 

986

 

 

 

—

 

 

 

1,337

 

Stock-based compensation total

 

$

427

 

 

$

986

 

 

$

—

 

 

$

1,413

 

 

 

 

 

Three Months Ended June 30, 2024

 

 

 

Gyre Pharmaceuticals

 

 

Gyre

 

 

Other

 

 

Consolidated

 

Revenues

 

$

25,225

 

 

$

—

 

 

$

—

 

 

$

25,225

 

Cost of revenues

 

 

770

 

 

 

—

 

 

 

—

 

 

 

770

 

Gross profit

 

 

24,455

 

 

 

—

 

 

 

—

 

 

 

24,455

 

Operating expenses excluding cost of revenues:

 

 

 

 

 

 

 

 

 

 

 

 

Selling and marketing

 

 

14,414

 

 

 

—

 

 

 

—

 

 

 

14,414

 

Research and development

 

 

3,077

 

 

 

278

 

 

 

—

 

 

 

3,355

 

General and administrative

 

 

2,549

 

 

 

874

 

 

 

1

 

 

 

3,424

 

Loss on disposal of assets, net

 

 

68

 

 

 

—

 

 

 

—

 

 

 

68

 

Total operating expenses excluding cost of revenues

 

 

20,108

 

 

 

1,152

 

 

 

1

 

 

 

21,261

 

Income (loss) from operations

 

 

4,347

 

 

 

(1,152

)

 

 

(1

)

 

 

3,194

 

Change in fair value of warrant liability

 

 

—

 

 

 

2,913

 

 

 

—

 

 

 

2,913

 

Other income (expense), net

 

 

53

 

 

 

(125

)

 

 

—

 

 

 

(72

)

Income tax expense

 

 

(1,497

)

 

 

—

 

 

 

—

 

 

 

(1,497

)

Net income

 

$

2,903

 

 

$

1,636

 

 

$

(1

)

 

$

4,538

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Supplemental disclosure of stock-based compensation expense:

 

 

 

 

 

 

 

 

 

 

 

 

General and administrative

 

$

—

 

 

$

16

 

 

$

—

 

 

$

16

 

Stock-based compensation total

 

$

—

 

 

$

16

 

 

$

—

 

 

$

16

 

 

 

 

Six Months Ended June 30, 2024

 

 

 

Gyre Pharmaceuticals

 

 

Gyre

 

 

Other

 

 

Consolidated

 

Revenues

 

$

52,397

 

 

$

—

 

 

$

—

 

 

$

52,397

 

Cost of revenues

 

 

1,749

 

 

 

—

 

 

 

—

 

 

 

1,749

 

Gross profit

 

 

50,648

 

 

 

—

 

 

 

—

 

 

 

50,648

 

Operating expenses excluding cost of revenues:

 

 

 

 

 

 

 

 

 

 

 

 

Selling and marketing

 

 

26,956

 

 

 

—

 

 

 

—

 

 

 

26,956

 

Research and development

 

 

5,086

 

 

 

451

 

 

 

—

 

 

 

5,537

 

General and administrative

 

 

4,806

 

 

 

2,015

 

 

 

1

 

 

 

6,822

 

Loss on disposal of assets, net

 

 

68

 

 

 

—

 

 

 

—

 

 

 

68

 

Total operating expenses excluding cost of revenues

 

 

36,916

 

 

 

2,466

 

 

 

1

 

 

 

39,383

 

Income (loss) from operations

 

 

13,732

 

 

 

(2,466

)

 

 

(1

)

 

 

11,265

 

Change in fair value of warrant liability

 

 

—

 

 

 

7,201

 

 

 

—

 

 

 

7,201

 

Other income (expense), net

 

 

115

 

 

 

(65

)

 

 

—

 

 

 

50

 

Income tax expense

 

 

(4,043

)

 

 

—

 

 

 

—

 

 

 

(4,043

)

Net income

 

$

9,804

 

 

$

4,670

 

 

$

(1

)

 

$

14,473

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Supplemental disclosure of stock-based compensation expense:

 

 

 

 

 

 

 

 

 

 

 

 

General and administrative

 

$

—

 

 

$

27

 

 

$

—

 

 

$

27

 

Stock-based compensation total

 

$

—

 

 

$

27

 

 

$

—

 

 

$

27

 

 

The table below presents total assets as of June 30, 2025 and December 31, 2024.

 

 

 

June 30, 2025

 

 

 

Gyre Pharmaceuticals

 

 

Gyre

 

 

Other

 

 

Consolidated

 

Total assets

 

$

121,142

 

 

$

31,139

 

 

$

365

 

 

$

152,646

 

 

 

 

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.

 

 

 

Six Months Ended June 30, 2025

 

 

 

Gyre Pharmaceuticals

 

 

Gyre

 

 

Other

 

 

Consolidated

 

Purchase of property and equipment

 

$

378

 

 

$

—

 

 

$

—

 

 

$

378

 

 

 

 

Six Months Ended June 30, 2024

 

 

 

Gyre Pharmaceuticals

 

 

Gyre

 

 

Other

 

 

Consolidated

 

Purchase of property and equipment

 

$

1,673

 

 

$

14

 

 

$

—

 

 

$

1,687