BeOne Medicines Ltd.

Previous wording

We provide certain financial measures that are not defined under accounting principles generally accepted in the United States of America (“GAAP”), commonly referred to as non-GAAP financial measures, including Adjusted Operating Expenses and Adjusted Income (Loss) from Operations and certain other non-GAAP measures, each of which include adjustments to GAAP figures. These non-GAAP measures are intended to provide additional information on our operating performance. Adjustments to our GAAP figures exclude, as applicable, non-cash items such as share-based compensation, depreciation and amortization. Certain other special items or substantive events may also be included in the non-GAAP adjustments periodically when their magnitude is significant within the periods incurred. We maintain an established non-GAAP policy that guides the determination of what items may be excluded in non-GAAP financial measures. We believe that these non-GAAP measures, when considered together with the GAAP figures, can enhance an overall understanding of our operating performance. The non-GAAP financial measures are included with the intent of providing investors with a more complete understanding of our historical and expected financial results and trends and to facilitate comparisons between periods and with respect to projected information. In addition, these non-GAAP financial measures are among the indicators BeiGene’s management uses for planning and forecasting purposes and measuring our performance. These non-GAAP financial measures should be considered in addition to, and not as a substitute for, or superior to, GAAP financial measures. The non-GAAP financial measures used by BeiGene may be calculated differently from, and therefore may not be comparable to, non-GAAP financial measures used by other companies.

Current wording

We provide certain financial measures that are not defined under accounting principles generally accepted in the United States of America (“GAAP”), commonly referred to as non-GAAP financial measures, including Adjusted Operating Expenses, Adjusted Income (Loss) from Operations, Adjusted Net Income (Loss), Adjusted Earnings Per Share and certain other non-GAAP measures, each of which include adjustments to GAAP figures. These non-GAAP measures are intended to provide additional information on our operating performance. Adjustments to our GAAP figures exclude, as applicable, non-cash items such as share-based compensation, depreciation and amortization. Certain other special items or substantive events may also be included in the non-GAAP adjustments periodically when their magnitude is significant within the periods incurred. Non-GAAP adjustments are tax effected to the extent there is US GAAP current tax expense. The Company currently records a valuation allowance on its net deferred tax assets, so there is no net impact recorded for deferred tax effects. We maintain an established non-GAAP policy that guides the determination of what items may be excluded in non-GAAP financial measures. We believe that these non-GAAP measures, when considered together with the GAAP figures, can enhance an overall understanding of our operating performance. The non-GAAP financial measures are included with the intent of providing investors with a more complete understanding of our historical and expected financial results and trends and to facilitate comparisons between periods and with respect to projected information. In addition, these non-GAAP financial measures are among the indicators BeiGene’s management uses for planning and forecasting purposes and measuring our performance. These non-GAAP financial measures should be considered in addition to, and not as a substitute for, or superior to, GAAP financial measures. The non-GAAP financial measures used by BeiGene may be calculated differently from, and therefore may not be comparable to, non-GAAP financial measures used by other companies.

Previous wording

Key highlights for the third quarter of 2024 are as follows:

Current wording

Key highlights for the first quarter of 2025 are as follows:

Previous wording

The following table summarizes our results of operations for the three and nine months ended September 30, 2024 and 2023:

Current wording

The following table summarizes our results of operations for the three months ended March 31, 2025 and 2024:

Previous wording

Total revenue increased to $2,682.4 million, or 47.0%, for the nine months ended September 30, 2024, from $1,824.4 million for the nine months ended September 30, 2023, primarily due to increased sales of our internally developed products, BRUKINSA and tislelizumab, as well as increased sales of in-licensed products, most notably from the Amgen products.

Current wording

Total revenue increased to $1,117.3 million for the three months ended March 31, 2025, from $751.7 million for the three months ended March 31, 2024, due to increased sales of BRUKINSA, TEVIMBRA, and our in-licensed products from Amgen.

Previous wording

Net product revenue increased 66.9% to $993.4 million for the three months ended September 30, 2024, compared to $595.3 million in the prior-year period, primarily due to continued increases in sales of BRUKINSA globally, driven by significant growth in the U.S. and Europe. In addition, product revenues in the third quarter of 2024 were positively impacted by sales of in-licensed products from Amgen in China and tislelizumab.

Current wording

Net product revenue increased 48.4% to $1,108.5 million for the three months ended March 31, 2025, compared to $746.9 million in the prior-year period, primarily due to increased sales of BRUKINSA globally, driven by continued growth in the U.S. and Europe. In addition, product revenues in the first quarter of 2025 were positively impacted by sales of TEVIMBRA and in-licensed products from Amgen.

Previous wording

Global revenue for BRUKINSA totaled $690.3 million in the third quarter, representing a 93.0% increase compared to the prior-year period; U.S. revenue for BRUKINSA totaled $503.7 million in the third quarter, compared to $270.1 million in the prior-year period, representing growth of 86.5%, due to quarter over quarter demand growth coming primarily from expanded use in CLL as BRUKINSA continued to gain share in CLL new patient starts. BRUKINSA revenue in Europe totaled $97.3 million in the third quarter, compared to $30.7 million in the prior-year period, representing growth of 217.2%, driven by increased market share across all major markets, including Germany, Italy, Spain, France and the UK. BRUKINSA revenue in China totaled $67.8 million, representing growth of 43.0%. BRUKINSA rest of world revenue totaled $21.4 million in the third quarter, representing growth of 125.0% compared to the prior-year period.

Current wording

Global revenue for BRUKINSA totaled $791.7 million in the first quarter, representing a 62.1% increase compared to the prior-year period; U.S. revenue for BRUKINSA totaled $563.2 million in the first quarter, compared to $351.5 million in the prior-year period, representing growth of 60.2%, driven primarily by demand, with the quarter over quarter growth coming primarily from expanded use in CLL as BRUKINSA continued to gain share as the leader in new patient starts in the U.S. in CLL and all other approved indications. BRUKINSA revenue in Europe totaled $115.9 million in the first quarter, compared to $66.8 million in the prior-year period, representing growth of 73.4%, driven by increased market share across all major European markets, including Germany, Italy, Spain, France and the UK. BRUKINSA revenue in China totaled $81.1 million, representing growth of 41.3%. BRUKINSA rest of world revenue totaled $31.4 million in the first quarter, representing growth of 145.4% compared to the prior-year period.

Previous wording

Revenue for Amgen products in China totaled $101.6 million in the third quarter, compared to $50.4 million in the prior-year period, representing a 101.5% increase, driven primarily by increased XGEVA sales volume.

Current wording

Revenue for Amgen products in China totaled $114.1 million in the first quarter, compared to $71.9 million in the prior-year period, representing a 58.7% increase, driven primarily by increased XGEVA® sales volume.

Previous wording

Collaboration revenue totaled $8.2 million for the three months ended September 30, 2024, primarily related to revenue generated under the Novartis broad markets marketing and promotion agreement. Collaboration revenue totaled $186.0 million for the three months ended September 30, 2023, recognized from deferred revenue associated with the former Novartis tislelizumab and ociperlimab collaborations.

Current wording

Collaboration revenue totaled $8.7 million and $4.7 million for the three months ended March 31, 2025 and 2024, respectively, primarily related to revenue generated under the Novartis broad markets marketing and promotion agreement and royalty revenue under the Amgen collaboration.

Previous wording

Gross margin on global product sales increased to $823.0 million for the three months ended September 30, 2024, compared to $499.0 million in the prior-year period, primarily due to increased product sales in the current year period. Gross margin as a percentage of product sales decreased to 82.8% for the three months ended September 30, 2024, from 83.8% in the comparable period of the prior year. The decrease is the result of accelerated depreciation expense of $16.9 million resulting from the move to more efficient, larger scale production lines for tislelizumab, with a similar amount to be incurred in the fourth quarter related to this move. On an adjusted basis, gross margin as a percentage of product sales increased to 84.9%, from 84.4% in the comparable period of the prior year due to proportionally higher sales mix of global BRUKINSA compared to other products in the portfolio.

Current wording

Gross margin on global product sales increased to $943.5 million for the three months ended March 31, 2025, compared to $622.0 million in the prior-year period, primarily due to increased product sales in the current year period. Gross margin as a percentage of product sales increased to 85.1% for the three months ended March 31, 2025, from 83.3% in the comparable period of the prior year. The gross margin percentage increased due to a proportionally higher sales mix of global BRUKINSA compared to other products in our portfolio. Gross margin also benefited from cost of sales productivity improvements for both BRUKINSA and TEVIMBRA. On an adjusted basis, which does not include depreciation and amortization, gross margin as a percentage of product sales increased to 85.5%, from 83.7% in the comparable period of the prior year.

Previous wording

Research and development expense increased by $42.9 million, or 9.5%, to $496.2 million for the three months ended September 30, 2024 from $453.3 million for the three months ended September 30, 2023. The following table summarizes external clinical, external non-clinical and internal research and development expense for the three months ended September 30, 2024 and 2023, respectively:

Current wording

Research and development expense increased by $21.2 million, or 4.6%, to $481.9 million for the three months ended March 31, 2025 from $460.6 million for the three months ended March 31, 2024. The following table summarizes external clinical, external non-clinical and internal research and development expense for the three months ended March 31, 2025 and 2024, respectively:

Previous wording

Our co-funding obligation for the development of the pipeline assets under the Amgen collaboration for the three months ended September 30, 2024 totaled $33.6 million, of which $17.0 million was recorded as R&D expense. The remaining $16.6 million was recorded as a reduction of the R&D cost share liability.

Current wording

Our co-funding obligation for the development of the pipeline assets under the Amgen collaboration for the three months ended March 31, 2025 totaled $40.5 million, of which $20.7 million was recorded as R&D expense. The remaining $19.8 million was recorded as a reduction of the R&D cost share liability.

Previous wording

The increase in external research and development expenses in the third quarter was primarily attributable to an increase in external costs of development programs primarily due to advancing preclinical programs into the clinic and early clinical programs into late stage, slightly offset by lower development upfront and milestone fees.

Current wording

The increase in external research and development expenses in the first quarter was primarily attributable to an increase in external costs of development programs primarily due to advancing preclinical programs into the clinic and early clinical programs into late stage, including Sonrotoclax (BCL2i), and slightly offset by lower development upfront and milestone fees.

Previous wording

Internal research and development expense increased modestly by $29.0 million, or 9.8%, to $325.1 million, and was primarily attributable to the expansion of our global development organization and our clinical and preclinical drug candidates, as well as our continued efforts to internalize research and clinical trial activities and control spend. Included within internal research and development expense for the three months ended September 30, 2024 is $24.9 million of accelerated depreciation expense related to the move of clinical production to larger, more efficient production lines with approximately $2.0 million remaining to be incurred in the fourth quarter.

Current wording

Internal research and development expense increased modestly by $1.9 million, or 0.6%, to $291.1 million, and was primarily attributable to the expansion of our global development organization and our clinical and preclinical drug candidates, as well as our continued efforts to internalize research and clinical trial activities and control spend.

Previous wording

Selling, general and administrative expense increased by $89.5 million, or 24.5%, to $455.2 million for the three months ended September 30, 2024, from $365.7 million for the three months ended September 30, 2023. The increase was primarily attributable to investing in the expansion of our commercial activities to support our product launches, primarily BRUKINSA in the U.S. and Europe to drive continued revenue and margin expansion. Selling, general and administrative expenses as a percentage of product sales were 45.8% in the third quarter of 2024 compared to 61.4% in the prior-year period. We expect continued investment growth in selling and marketing expenses as our product sales increase.

Current wording

Selling, general and administrative expense increased by $31.9 million, or 7.5%, to $459.3 million for the three months ended March 31, 2025, from $427.4 million for the three months ended March 31, 2024. The increase was primarily attributable to continued investment in the global commercial expansion of BRUKINSA primarily in the U.S. and Europe. Selling, general and administrative expenses as a percentage of product sales were 41.4% in the first quarter of 2025 compared to 57.2% in the prior-year period. We expect continued investment in selling and marketing activities as our product sales increase.

Previous wording

Interest income, net decreased by $16.0 million, or 60.1%, to $10.6 million for the three months ended September 30, 2024, from $26.6 million for three months ended September 30, 2023. The decrease in interest income, net, was primarily attributable to decreased interest income resulting from lower interest rates on our cash and cash equivalents balance. Interest expense increased resulting from a higher debt balance and lower interest capitalized related to Hopewell construction in process.

Current wording

Interest income, net decreased by $10.3 million, or 63.8%, to $5.8 million for the three months ended March 31, 2025, from $16.2 million for three months ended March 31, 2024. The decrease in interest income, net, was primarily attributable to decreased interest income resulting from lower interest rates on our cash and cash equivalents balance. Interest expense increased resulting from a higher debt balance and lower interest capitalized related to Hopewell construction in process.

Previous wording

Other income, net was $11.3 million for the three months ended September 30, 2024, primarily due to foreign exchange gains. For the three months ended September 30, 2023, other income, net was $336.7 million, primarily due to the noncash gain recorded for the receipt of ordinary shares resulting from the BMS settlement and government subsidy income, partially offset by foreign exchange losses resulting from the strengthening of the U.S. dollar compared to the RMB in the period and the revaluation impact of foreign currencies held in U.S. functional currency subsidiaries and unrealized losses on our equity investments.

Current wording

Other income, net was $4.0 million for the three months ended March 31, 2025, primarily due to foreign exchange gains and government subsidy income, partially offset by unrealized losses on our equity investments. For the three months ended March 31, 2024, other income, net was $1.8 million, primarily due to government subsidy income, partially offset by foreign exchange losses resulting from the strengthening of the U.S. dollar compared to the RMB in the period and the revaluation impact of foreign currencies held in U.S. functional currency subsidiaries and unrealized losses on our equity investments.

Previous wording

Income tax expense was $23.0 million for the three months ended September 30, 2024 as compared to $13.9 million for the three months ended September 30, 2023. The income tax expense for the three months ended September 30, 2024 and 2023 was primarily attributable to current U.S. tax expense determined after other special tax deductions and research and development tax credits, current Switzerland tax expense based on year to date earnings, and current China tax expense due to certain non-deductible expenses.

Current wording

Income tax expense was $19.6 million for the three months ended March 31, 2025 as compared to $7.7 million for the three months ended March 31, 2024. The income tax expense for the three months ended March 31, 2025 and 2024 was primarily attributable to current U.S. tax expense determined after other special tax deductions and research and development tax credits, current Switzerland tax expense based on year to date earnings, current China tax expense due to certain non-deductible expenses, and other intercompany discrete adjustments.

Previous wording

To date, we have financed our operations principally through proceeds from public and private offerings of our common stock (including ADSs), proceeds from debt, and our collaborations, together with product sales since September 2017. Based on our current operating plan, we expect that our existing cash and cash equivalents as of September 30, 2024 will enable us to fund our operating expenses and capital expenditure requirements for at least the next 12 months after the date that the financial statements included in this report are issued. We have also financed our operations and investments with proceeds from debt incurred primarily from various banks both through our subsidiaries and BeiGene, Ltd. of $1.1 billion at September 30, 2024. The majority of those debt obligations, or approximately $863.8 million, owed by BeiGene, Ltd., have due dates within the next 12 months. We believe we will have sufficient cash and cash equivalents and other sources of capital to be able to repay and/or refinance those debt obligations.

Current wording

To date, we have financed our operations and investments in long-term assets principally through proceeds from public and private offerings of our securities, proceeds from debt and our collaborations, and since the third quarter of 2024 cash flow from operations. Based on our current operating plan, we expect that our operating cash flows and existing cash and cash equivalents will enable us to fund our operating expenses and planned long-term investments for at least the next 12 months after the date that the financial statements included in this report are issued. We have also financed our operations and investments with proceeds from debt primarily incurred through various banks by both our subsidiaries and the Parent Company of $923.6 million as of March 31, 2025. We paid down $97.1 million of the debt in the first quarter of 2025 using existing cash. The majority of those debt obligations, or approximately $670.5 million, owed by BeiGene, Ltd. mature within the next 12 months. We believe we will have sufficient cash and cash equivalents and other sources of capital to be able to repay and/or refinance those debt obligations on a consolidated basis.

Previous wording

On December 15, 2021, we completed our initial public offering on the STAR Market of the Shanghai Stock Exchange (the “STAR Offering”). The shares offered in the STAR Offering were issued to and subscribed for by permitted investors in the People’s Republic of China (“PRC”) in Renminbi (“RMB Shares”). The public offering price of the RMB Shares was RMB 192.60 per ordinary share, or $391.68 per ADS. In this offering, we sold 115,055,260 ordinary shares. Net proceeds after deducting underwriting commissions and offering expenses were $3.4 billion (RMB 21.7 billion). As required by the PRC securities laws, the net proceeds from the STAR Offering must be used in compliance with the planned uses as disclosed in the PRC prospectus as well as our proceeds management policy for the STAR Offering approved by our board of directors. As of September 30, 2024, the Company had cash remaining related to the STAR Offering proceeds of $0.8 billion.

Current wording

On December 15, 2021, we completed our initial public offering on the STAR Market of the Shanghai Stock Exchange (the “STAR Offering”). As required by the PRC securities laws, the net proceeds from the STAR Offering must be used in compliance with the planned uses as disclosed in the PRC prospectus as well as our proceeds management policy for the STAR Offering approved by our board of directors. As of March 31, 2025, the Company had cash remaining related to the STAR Offering proceeds of $461.6 million.

Previous wording

The following table provides information regarding our cash flows for the nine months ended September 30, 2024 and 2023:

Current wording

The following table provides information regarding our cash flows for the three months ended March 31, 2025 and 2024:

Previous wording

Cash used in operating activities improved $720.0 million in the nine months ended September 30, 2024, versus the prior year period due to our significantly improved revenue and $698.6 million of increase in gross margin in the current year period, offset by continued funding of our development pipeline, commercial operations and increasing working capital to support our global expansion.

Current wording

Cash provided by operating activities improved $352.7 million in the three months ended March 31, 2025, versus the prior year period due to our significantly improved revenue and $325.6 million of increase in gross margin in the current year period, offset by continued funding of our development pipeline and commercial operations, increasing working capital to support our global expansion and the timing of compensation-related payments.

Previous wording

Investing activities used $454.7 million of cash in the nine months ended September 30, 2024, compared to $122.6 million of cash provided in the prior year period due primarily to a decrease in proceeds from sales and maturities of investment securities.

Current wording

Investing activities used $121.9 million of cash in the three months ended March 31, 2025, compared to $209.8 million in the prior year period due primarily to a decrease in capital expenditures, partially offset by an increase in acquired in-process research and development.

Previous wording

Financing activities provided $198.0 million of cash in the nine months ended September 30, 2024, compared to $69.4 million in the prior year period due primarily to higher proceeds from short-term bank loans in the current year period.

Current wording

Financing activities used $33.8 million of cash in the three months ended March 31, 2025, compared to $162.3 million of cash provided in the prior year period due primarily to a net reduction in short-term debt borrowings in the current year period, partially offset by higher proceeds from option exercises and employee share purchase plan.

Previous wording

Our borrowing and repayment cycle is dictated by the short-term maturities of our debt and the ability to increase our borrowings is dependent on interest rates, credit spreads, bank lending capacity and other factors. We expect to repay approximately $863.8 million of loans in the next 12 months and expect to be able to re-finance those on a consistent basis with our historical experience, with the cost of those borrowings depending on prevailing interest rates and credit spreads.

Current wording

Our borrowing and repayment cycle is dictated by the short-term maturities of our debt and the ability to increase our borrowings, if necessary, is dependent on interest rates, credit spreads, bank lending capacity and other factors. We expect to repay approximately $763.5 million of loans in the next 12 months and expect to be able to re-finance those on a consistent basis with our historical experience, with the cost of those borrowings depending on prevailing interest rates and credit spreads.

Previous wording

Our material cash requirements in the short- and long-term consist of the following operational, capital, and manufacturing expenditures, a portion of which contain contractual or other obligations. We plan to fund our material cash requirements with our current financial resources together with our anticipated receipts of accounts receivable and product sales.

Current wording

Our material cash requirements in the short- and long-term consist of the following operational, capital, and manufacturing expenditures, a portion of which contain contractual or other obligations. We plan to fund our material cash requirements with cash on hand.

Previous wording

As of September 30, 2024, non-cancellable purchase commitments amounted to $155.9 million, of which $30.0 million related to minimum purchase requirements for supply purchased from contract manufacturers and $125.9 million related to binding purchase obligations of inventory from Amgen. We do not have any minimum purchase requirements for inventory from Amgen.

Current wording

As of March 31, 2025, non-cancellable purchase commitments amounted to $152.9 million, of which $31.0 million related to minimum purchase requirements for supply purchased from contract manufacturers and $121.9 million related to binding purchase obligations of inventory from Amgen. We do not have any minimum purchase requirements for inventory from Amgen.

Previous wording

We have numerous financial and non-financial covenants on our debt obligations with various banks and other lenders. Some of these covenants include cross-default provisions that could require acceleration of repayment of loans in the event of default. However, our debt is primarily short-term in nature. Any acceleration would be a matter of months but may impact our ability to refinance debt obligations if an event of default occurs. As of September 30, 2024, we were in compliance with all covenants of our material debt agreements.

Current wording

Total debt obligations coming due in the next twelve months are $763.5 million. Total long-term debt obligations are $160.2 million. We have numerous financial and non-financial covenants on our debt obligations with various banks and other lenders. Some of these covenants include default and/or cross-default provisions that could require acceleration of repayment of loans in the event of default. However, our debt is primarily short-term in nature. Any acceleration would be a matter of months but may impact our ability to refinance debt obligations if an event of default occurs. As of March 31, 2025, we were in compliance with all covenants of our material debt agreements. See above regarding Liquidity and Capital Resources and Note 10 in the Notes to the Financial Statements for further detail of our debt obligations.

Previous wording

Under the Amgen collaboration, we are responsible for co-funding global development costs for the licensed Amgen oncology pipeline assets up to a total cap of $1.25 billion. We are funding our portion of the co-development costs by contributing cash and development services. As of September 30, 2024, our remaining co-development funding commitment was $379.1 million.

Current wording

Under the Amgen collaboration, we are responsible for co-funding global development costs for the licensed Amgen oncology pipeline assets up to a total cap of $1.25 billion. We are funding our portion of the co-development costs by contributing cash and development services. As of March 31, 2025, our remaining co-development funding commitment was $295.1 million.

Previous wording

Funding commitment represents our committed capital related to two equity method investments. As of September 30, 2024, our remaining capital commitment was $8.2 million and is expected to be paid from time to time over the investment period.

Current wording

Funding commitment represents our committed capital related to two equity method investments. As of March 31, 2025, our remaining capital commitment was $5.9 million and is expected to be paid from time to time over the investment period.

Previous wording

We had capital commitments amounting to $66.2 million for the acquisition of property, plant and equipment as of September 30, 2024, related to various facilities across the globe, including the manufacturing and clinical R&D campus in Hopewell, New Jersey.

Current wording

We had capital commitments amounting to $56.3 million for the acquisition of property, plant and equipment as of March 31, 2025, related to various facilities across the globe, including the manufacturing and clinical R&D campus in Hopewell, New Jersey.

Previous wording

There have been no material changes to our critical accounting policies as of and for the three and nine months ended September 30, 2024, as compared to those described in the section titled “Part I—Item 7—Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our Annual Report on Form 10-K for the year ended December 31, 2023.

Current wording

There have been no material changes to our critical accounting policies as of and for the three months ended March 31, 2025, as compared to those described in the section titled “Part I—Item 7—Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our Annual Report on Form 10-K for the year ended December 31, 2024.

Previous wording

For new accounting policies adopted during the three and nine months ended September 30, 2024, see “Part I—Item 1—Financial Statements—Notes to the Condensed Consolidated Financial Statements—1. Description of Business, Basis of Presentation and Consolidation and Significant Accounting Policies—Significant accounting policies” in this Quarterly Report on Form 10-Q.

Current wording

For new accounting policies adopted during the three months ended March 31, 2025, see “Part I—Item 1—Financial Statements—Notes to the Condensed Consolidated Financial Statements—1. Description of Business, Basis of Presentation and Consolidation and Significant Accounting Policies—Significant accounting policies” in this Quarterly Report on Form 10-Q.