Dizhe Pharmaceutical's dual product commercialization struggles to stop losses, going public in Hong Kong to bolster pipeline development

Securities Star Liu Fengru

Spun off from AstraZeneca, Dize Pharmaceutical (688192.SH) has successfully commercialized two core products, Shuvoze and Gaorui Ze, achieving continuous significant revenue growth, with an expected year-over-year increase of over 120% in sales revenue in 2025. However, high R&D and sales expenses continue to erode profits, with a cumulative loss of over 4 billion yuan over seven years, and long-term cash flow pressures.

Securities Star notes that sustained R&D investment is the foundation for innovative pharmaceutical companies to maintain competitiveness. Backed by favorable policies related to biotech and medicine in Hong Kong stocks, Dize Pharma has initiated plans to list in Hong Kong, aiming to expand financing channels to support R&D and global expansion. Nonetheless, intense industry competition still presents many challenges to its development.

Two products in commercialization, revenue growth cannot hide ongoing losses

Founded in 2017, Dize Pharma was formerly the Asia Innovation Drug and Early R&D Center of AstraZeneca’s Global Oncology Translational Science Center. It is a commercial-stage biopharmaceutical company focusing on oncology and hematological diseases. Currently, Dize Pharma holds two commercialized products: Shuvoze (generic name: Surufatinib) and Gaorui Ze (generic name: Golvatinib).

Shuvoze received approval from the National Medical Products Administration (NMPA) in August 2023 and was approved by the U.S. FDA in July 2025 for treating locally advanced or metastatic NSCLC in adults with prior platinum-based chemotherapy and EGFR exon 20 insertion mutations. According to Zhuoshi Consulting, Shuvoze is the first innovative, first-in-class drug discovered, developed, and approved in the U.S. in China. It is also the first lung cancer drug recognized as a breakthrough therapy in both the U.S. and China. Currently, Shuvoze is the only second- or third-line treatment drug for EGFR exon 20 insertion NSCLC included in the national medical insurance catalog.

Gaorui Ze is a new generation oral highly selective JAK1 inhibitor used to treat hematological diseases and solid tumors without driver gene mutations. It was approved by the NMPA in June 2024 for treating adult relapsed/refractory peripheral T-cell lymphoma. Additionally, Gaorui Ze has received Fast Track and Orphan Drug designations from the U.S. FDA for treating relapsed/refractory PTCL. It is the first and only JAK1-specific inhibitor approved for T-cell lymphoma.

Commercialization of these products has become the core driver of revenue growth, with revenues climbing in steps. In 2023 and 2024, Dize Pharma’s revenue was 91.289 million yuan and 360 million yuan, respectively. All of 2023’s revenue came from Shuvoze, which contributed 91.3 million yuan. In 2024, Shuvoze and Gaorui Ze contributed approximately 311 million yuan and 49.1 million yuan, respectively.

In 2025, benefiting from the inclusion of these two products in the national insurance catalog for the first time, improving patient access, and the company’s increased marketing efforts, Dize Pharma expects to achieve about 800 million yuan in product sales revenue, a year-over-year increase of 122.28%.

Securities Star notes that despite the revenue growth of core products, Dize Pharma has yet to escape losses, with cumulative losses since inception exceeding 4 billion yuan. In 2023 and 2024, net losses were 1.108 billion yuan and 940 million yuan, respectively. The 2025 outlook remains bleak, with an estimated net loss attributable to shareholders of 770 million yuan and a non-recurring profit loss of 850 million yuan. Although losses have narrowed, the company remains unprofitable. Over the long term, from inception to 2024, cumulative losses have exceeded 4 billion yuan.

Accompanying ongoing losses is the company’s long-term “cash drain.” In 2023 and 2024, net cash used in operating activities was -973 million yuan and -654 million yuan. In the first nine months of 2025, net cash used was -425 million yuan, indicating continuous net cash outflow from operations and significant funding pressure.

“Two expenses” consume profits, R&D pipeline still requires huge investment

The core reason for Dize Pharma’s ongoing losses is the high costs of R&D and sales expenses, creating a “two expenses” pressure that far exceeds its revenue.

Data shows that R&D expenses in 2023 and 2024 were 806 million yuan and 724 million yuan, respectively. Despite substantial revenue growth, R&D investment remains high. The company expects R&D expenses to increase by 18.84% to 860 million yuan in 2025. Sales and distribution expenses also rose annually, reaching 210 million yuan in 2023 and 445 million yuan in 2024, becoming another major profit drain.

As an innovative pharmaceutical company, continuous R&D investment is essential for maintaining global competitiveness. Dize Pharma’s R&D pipeline continues to expand. Besides the two commercialized products, it has one candidate drug in registration trials, three assets in late-stage proof-of-concept, and one in early clinical stage. Notably, Birelentinib (DZD8586) is an innovative dual inhibitor of lymphocyte-specific protein tyrosine kinase (Lyn) and Bruton’s tyrosine kinase (BTK), the first and only in clinical development. It received Fast Track designation from the U.S. FDA in August 2025, and in September 2025, Dize Pharma launched a global Phase III trial for relapsed/refractory CLL/SLL.

The development of innovative drugs follows the “double ten” rule: on average, a new drug takes over 10 years and costs billions of dollars from R&D to market. This means that further pipeline development and deepening of existing product commercialization will require enormous ongoing funding.

Facing persistent capital needs, Dize Pharma has mainly relied on capital markets for “blood transfusions.” In 2021, it raised about 2.103 billion yuan through an IPO on the STAR Market, and in 2025, it raised approximately 1.796 billion yuan through a private placement, totaling nearly 4 billion yuan in fundraising.

Securities Star notes that at the policy level, the CSRC has explicitly supported leading companies to list in Hong Kong. The Hong Kong Stock Exchange has introduced measures such as fast approval for A-share companies, and special lines for tech and biotech firms, facilitating cross-border listings for mainland biotech companies. “A+H” listings have become a new industry trend.

Aligned with HKEX rules, Dize Pharma has launched a Hong Kong listing attempt, which is a necessary step to expand new financing channels. The company states that the main purpose of applying for a Hong Kong listing is to deepen its global strategy, enhance its international brand image, and improve core competitiveness. According to the prospectus, net proceeds from the Hong Kong listing will mainly be used for clinical development or preclinical research of Shuvoze, Gaorui Ze, DZD6008, and other products, as well as sales and marketing efforts.

However, Dize Pharma still faces multiple challenges in the pharmaceutical industry. The industry is characterized by rapid technological iteration, fierce competition, and a high focus on patent-protected drugs. The company must compete with large domestic and international pharmaceutical firms and contend with emerging biotech startups. Many similar indications and candidate drugs are under development. Even with heavy R&D investment, it may still face difficulties in timely, low-cost development and commercialization of new candidates or expanded indications, along with issues related to intellectual property protection.