2020 Annual Result Conference Call. I'm Duan Pengfei, Investor Relations Director at GenScript. Joining me on the call today are Mr. Robin Meng, Chairman of the Board, Ms. Sherry Shao, Rotating CEO of GenScript, Dr. Patrick Liu, Operating Rotating CEO of GenScript, Mr. Shiniu Wei, CFO of GenScript, Dr. Ying Huang, CEO of Legend Biotech, Dr. Brian Min, CEO of GenScript ProBio, Dr. Ray Chen, President of GenScript Life Science Group, Dr. Aixi Bai, General Manager of Bestzyme. Before we begin, I would like to remind everyone that on today's call, we will be making statements about future expectations, plans, and perspectives, as well as any other statements regarding matters that are not historical factors, which may constitute forward-looking statements. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important risk factors and changing market conditions. We do not undertake any obligations to publicly update any forward-looking statements. In today's conference call, Sherry, our Rotating CEO, will share business highlights and future strategies with you. Our CFO will walk you through our financial performance. We also have a Q&A section for you at the end of the call. Let's start with our CEO presentation. Sherry, please. Hi, everyone. I'm Sherry Shao, Rotating CEO of GenScript. I'm pleased to share with you our business update. 2022 was a challenging year that included geopolitical tensions, war in Ukraine, volatile currency, and COVID disruption. Despite those facts, we are able to navigate through the choppy waters and maintain solid business growth. On behalf of the group, I'd like to thank GenScript people for their dedication and support to our business success. I will start with some facts and highlights about our business for each segment. GenScript Life Science is the foundation of group business. Revenue from Life Science business grew about 14.2%, demonstrating 21 years of consecutive growth. The organic growth at constant currency, excluding the COVID impact, was about 22.6%. In 2022, we served about 49,000 customers, rising 6.5% Y-o-Y. In terms of regional performance, Asia Pacific business saw impressive growth. Europe business recovered from the COVID impact. Our US business maintained steady growth. We launched innovative reagent consumables and equipment for gene and cell therapies. ProBio continued its strong growth in 2022. ProBio's revenue grew 54%. Constant currency revenue growth is at 59.3%. In terms of our regional revenue split, we have a 50/50 split between international and Mainland China sales. Turning to our check records, we signed 36 new biologic CMC projects and 55 new GCT CMC projects. We helped customers obtain 22 China and international new IND approvals. We also upgraded our antibody, protein, and GCT-related platforms to enhance competitiveness. Bestzyme's revenue growth turned positive in H2 2022. We continued to optimize the cost of various enzyme products and developed new fit proteins, helping customers manage the rising cost of raw materials. By implementing our new business strategy, Bestzyme's gross margin grew to 43%. To ensure our future growth, we continue to invest in our expression platforms and added to our offering by launching proteins for liquid detergent and muramidase. We licensed out fatty acid technology using enzymatic hydrolysis, generating RMB 15 million in revenue. Turning to Legend Biotech, cilta-cel received last line commercial approvals in the US, EU, and Japan, and generated $134 million in net sales. To address clinical needs of frontline multiple myeloma patients, we are also conducting clinical CARTITUDE-4, -5, and -6 Phase III trials. In January 2023, CARTITUDE-4 met its primary endpoint. Results from the CARTITUDE-4 study will be presented at an upcoming medical conference and will support discussions with health authorities about potential regulatory submissions. Legend is also ramping up capacity to support market demand. Let's dive into detailed performance of our four segments. Starting with Life Science, we have been investing in our gene-related technology platform and processes. Leveraging our cutting-edge chip-based oligo support technology, we have been able to further improve the competitiveness of our Gene Fragments service. We will launch GenTitan Gene Fragments service by Q2 this year, which will allow us to support diversified gene synthesis needs. As a reliable one-stop product and service provider in the industry, we have also optimized our operations to meet diverse customer needs. The booming GCT and mRNA industry drives robust demand for high-quality genes and plasmids. Last year, we upgraded services for AAV and mRNA-related downstream applications. Turning to protein and antibody business. Empowered by our high-throughput Rush Gene Synthesis and the laboratory high expression platform Turbo CHO, we have shortened turnaround time for protein and antibody services to 7 to 10 business days, supporting the increasing demand for biologics from early stage R&D to pre-clinical stage. Moving to peptide business. We have upgraded PepHTS platform, which is the world's largest automated peptide workstation. We have also established a platform for complex modified peptides like non-peptidic peptides, offering innovative peptide drug solutions to our customers. Now, we are building a GMP peptide facility in Zhenjiang, which could support a full range of services from R&D filing to clinical manufacturing for innovative peptide drugs. In nucleic acid business, as a first-class supplier of CRISPR materials in CRISPR-based gene editing tool, we developed one-stop solutions from RUO grade to GMP- grade manufacturing, successfully increased the batch volume of CRISPR sgRNA while shortening turnaround time. We increased our ssDNA capacity to 6 KB milligram level, rolled out a super coiled circular vector in minimal size for transposons and gene therapy. To support global customers, we implemented a global project management process. We have successfully supported the first U CAR- T IND approval in China. Our services have been cited by our customers in leading peer-reviewed journals such as Nature and Science, which validates our ability to explore life science frontiers along with our customers. In GCT-related instruments and consumables. CytoSinct, our cell isolation platform for CAR-T cell preparation, has received orders from cell therapy customers in China, is also under testing among overseas customers. We have also launched magnetic beads for NK, SA, CD4, CD8 cell separation, beads for T-cell activation, and columns for cell separation. To support future demand for GMP-grade bead manufacturing, we will complete the 2 GMP-grade bead manufacturing facilities in mid-2023. We also launched MF partial automated system for fully automated plasmid preparation in H2 2022. By the end of 2022, we have served over 49,000 global customers, rising 7% versus 2021. We saw an increase in industrial customers, which made up 54% of our global sales. This shows the increase in average sales from each customer as we provide upscale and more complex services. Both our mainland China and international business continued strong momentum. We have elevated our customer service over the years. In 2022, over 10,000 mainstream journal articles cited our products and services. Our life science capacity expansion plan is aligned with our strategy. First, to renovate traditional business lines for higher throughput and automation. Second, to build up capacity for emerging business. Third, to support localized production for global customers. New facilities could support our business growth in the new next 3-5 years. Turning to ProBio, we delivered strong growth. In addition to a solid track record, we focused on upgrading our technology platform, boosting production efficiency, and improving services for therapeutic drug modalities. In protein and antibody drug CDMO business, our discovery business has been the foundation of ProBio's success. We shortened the timeline for hybridoma services to 12 weeks, and improved our success rate to over 90%. By leveraging 6 leads generation technologies, 14 in- vitro assays, and four in- vivo validation, we can both deliver traditional biologic products and novel drug modalities such as bispecific, fusion protein, cell therapy, ADC, and AOC. On large-scale protein and antibody production, our new vectors could boost yield to 15 grams/liter. With accumulation of experience from our CMC orders, we have shortened turnaround time to six months. We launched our first aseptic fill and finish line for liquid product and prefilled syringe filling. In gene and cell therapy business, our focus is to improve our processes and accumulate track record. We are now the number 1 GMP plasmid supplier in China. We are expanding our plasmid application and GMP- grade manufacturing capabilities. In viral vector business, our proprietary suspension cell line, PowerS -293T, enables efficient viral vector packaging and higher supernatant titer. We delivered over 70 batch and several 50-liter GMP batch manufacturing. We also launched our AAV platform, which allows us to offer a wide range of services. mRNA technology has been increasingly used for areas beyond COVID vaccines. As the critical material for the mRNA platform, plasmids play a critical role in manufacturing. To better address market needs, we launched one-stop mRNA service. Turning to our track record. In biologics CDMO business, we saw an increase in CMC projects, reflecting our improved CMO capabilities. In GCT CDMO business, despite a decline in CMC projects, our projects in R&D filing process increased significantly. Moving to Bestzyme, o ur focus is on three areas. On production, we aim to optimize production processes and continuously reduce manufacturing costs. We achieved over 10% efficiency improvements in fermentation, extraction, and formulation processes. On sales, we drive sales by enriching our product portfolios and strengthening overseas market penetration. Our free enzyme product line covers more than 20 single enzymes and multiple compound enzymes. On industrial enzyme, we gain market share through our competitive products and new launch, improving our industrial product line. In 2022, our overseas sales efforts brought us about 43% overseas sales growth on industrial enzymes. On R&D, we have been upgrading our core products. We optimized the formulation of 2 lead products to improve cost structure. We also optimized strength for six products. We refined our products for downstream applications and launched China's first protein for liquid detergent and muramidase. Synthetic biology is one of the major areas of our future investment. Our synthetic biology pipeline works on substitution for traditional chemically synthesized products and nutritional additives. Fatty acid technology using enzymatic hydrolysis is at the forefront of our pipeline, which has been licensed to our partner and generated about RMB 15 million in revenue in 2022. Going forward, we will cooperate with our partner on manufacturing and commercialization of this product. In addition, we are also exploring opportunities in glycated hemoglobin and organic acids. Legend Biotech is our cell therapy segment. Throughout 2022, along with our partner, Janssen, Legend received commercial approvals for its lead production, CARVYKTI, in the US, EU, and Japan, making a new treatment option available to frontline multiple myeloma patients. Currently, Legend is actively ramping up capacity to meet patients' needs for cilta-cel. With respect to two clinical studies, CARTITUDE-4 program is our first Phase III study for multiple myeloma, evaluating cilta-cel for the treatment of patients who have received 1, 2, 3 prior line therapy and also who are refractory to Revlimid. The study enrolled over 400 patients, with the last patient enrolled in October 2021. In January, CARTITUDE-4 met its primary endpoint. Results from the CARTITUDE-4 study will be presented at an upcoming medical conference and support potential regulatory submissions for frontline indications. We also started our first Phase III trial in first-line multiple myeloma called CARTITUDE-5, and this is the Phase III open label study of cilta-cel. We plan to enroll 650 patients. We are comparing to active control arm, where the patients are being treated with standard of VRd followed by Rd maintenance. This is actually the first Phase III trial for an BCMA-targeting CAR- T in the first-line setting of multiple myeloma. CARTITUDE-6 was initiated early this year. Another Phase III trial in frontline setting, aiming to compare the efficacy of DVRd followed by cilta-cel versus DVRd followed by ASCT in newly diagnosed multiple myeloma patients who are transplant-eligible. We plan to enroll roughly 750 patients. Looking at other programs, the US FDA approved R&D application for solid tumor CAR- T, LB1908, targeting relapsed or refractory gastric esophageal and pancreatic cancers. In November 2022, the US FDA also approved IND application for LB2102, an investigational CAR- T therapy for the treatment of adult patients with extensive-stage small cell lung cancer. I will turn it to Shiniu to recap the financials. Thank you, Sherry. For those who are listening online, I'm on page 17 of our slide deck. GenScript continues to deliver steady growth in 2022. Group revenue grew 27.7% year-over-year to about $625.7 million. Group's gross profit reached about $304.1 million, an increase of 7.6% year-over-year. Group gross margin was about 48.6%. Group consolidated net loss was about $428 million, and adjusted net loss was about $359.4 million. Non-cell therapy business saw continued growth in 2022. External revenue grew 19.8% to about $509 million, driven by new product launch, stronger business development capabilities, and ramp up of capacity in our three business segments. Our non-cell therapy business reported adjusted gross profit of about $268.1 million, 17.4% higher year-over-year, and adjusted net profit of about $62.4 million, 31.4% higher year-over-year. Our cell therapy business generated revenue of $117 million, up 70% year-over-year, reflecting continued revenue recognition of upfront and milestone payments from collaboration with Janssen, and also our share of the sale, product sale of cilta-cel. The adjusted net loss for cell therapy business was about $422 million, mainly due to increased clinical trials of cilta-cel and other R&D activities. Please also note cell therapy profit loss figures reported at a group level may slightly different from Legend's own reported numbers due to intercompany elimination. On page 18, we continue to invest in R&D under our long-term strategy. Excluding share-based compensation expenses, our total R&D expense was $368 million, up about 7% year-over-year. In 2022, R&D expenses of our non-cell therapy business grew 17%, which is in line with our strategic planning. R&D as a percentage of our non-cell therapy revenue is expected to remain about 10% of R&D expenses, while our cell therapy business grew 5% due to R&D investment in cilta-cel and other pipeline activities. We expect R&D expenses related to cilta-cel to increase in 2023. Our CapEx was about $218 million. Major areas of CapEx included capacity expansion for Life Science business, CDMO business, and commercial manufacturing of cilta-cel. The Group has a strong balance sheet. As of the end of 2022, our cash position stood at roughly $1.5 billion. Cell therapy business has a cash position of about $1 billion, while non-cell therapy business cash stood at about $463 million. In early 2023, ProBio also announced another round of financing for about $200 million, further adding to our cash position. Now, I will turn to page 19 to provide details about our segment financials. Starting with our Life Science business, which maintained rapid growth. Reported revenue was about $361 million, up 14.2% year-over-year. The organic growth at constant currency, excluding COVID related products, decline, was about 22.6%. Adjusted gross profit grew 8% year-over-year to about $201 million. Adjusted gross margin was 55.8%, decreased slightly from the 59% level last year for the 5th. The decline was mainly due to several factors. First, our capacity ramp up in Singapore and the U.S. initially produced lower gross margin. Second, shipping costs continued to rise in 2022 due to COVID, but we expect shipping costs to grow slower in the coming years. Third, decrease in high margin COVID related revenue. However, we think all these factors are short term. I would like to let you know that ProBio has established an independent legal entity. Therefore, group's non-cell therapy operating expenses have been allocated to the three business segments within this year. Due to allocation of back office expenses, R&D, selling and administrative expenses and operating profits cannot be directly compared year-over-year. Life Science business reported adjusted operating profit of about $66.1 million and adjusted operating margin was about 18.3% in 2022. Due to uncertainties in global macroeconomic, we expect Life Science revenue to grow about 10%-20% and gross margin to be flat or slightly declined compared to 2023. Turning to Biologics CDMO business. GenScript ProBio continued robust growth. Reported revenue grew 53.6% year-over-year to $125 million. Revenue at constant currency grew 59.3%. This was primarily driven by successful delivery of ongoing CDMO projects and increase in demand for gene and cell therapy CDMO. Within ProBio, gene and cell therapy CDMO service delivered revenue growth of 129% year-over-year. Antibody and protein drug CDMO groups 32% in revenue. ProBio's China-based and international business grew in parallel, reaching a roughly 50/50 revenue split. As the pandemic subsides, overseas market will be our priority in 2023, we expect to invest more aggressively in overseas sales and marketing activities. We moved to an e-economy that's more challenging in 2022. As of the end of 2022, ProBio's total backlog stood at about $233 million, up 18% year-over-year. Among which, fee for service backlogs has increased about 21% to $215 million. We expect to convert backlogs into revenue in the next 2 years. As ProBio grew its revenue, adjusted gross profit was also grew 64.5% to $42.8 million. With higher capacity utilization, substitution with domestic materials, R&D optimization, and higher labor efficiency, we believe adjusted gross profit still has room to improve. In 2022, adjusted EBITDA was about $15.2 million, and we expect our production costs and administrative expenses to further improve as we scale up. ProBio raised Series B and Series C financing in 2022 and early 2023 respectively, which will support our growth momentum. Following Series C financing, before converting ESOP and warrants, the group owns about 70% of ProBio. We expect ProBio revenue to continue to grow at about 30%-50% rate in 2023, and gross margin to be flat to slightly improve in 2023. Turning to industrial synthetic biology products. Bestzyme revenue was $38.7 million, and revenue growth turned positive in H2. By implementing our new business strategy, gross profit and gross margin grew fast. Revenue from feed enzyme business declined about 22%, mainly due to COVID and the feed enzyme market decline. However, our industrial enzyme business grew 23% year-over-year, thanks to improvement in our existing products and launch of new products. Also in 2022, we licensed a patent to our partner and received patent royalty of RMB 15 million. Excluding this impact, our gross margin was about 40% for Bestzyme business. Adjusted operating profit reached $2.6 million, up significantly year-over-year. We expect revenue to continue to grow 20%-30% for 2023 for this business and gross margin remain flat. Now turning to cell therapy on page 22. Legend reported revenue of about $117 million, reflecting milestone payments of $50 million. Also Legend received collaborative sales revenue of $66.7 million for CARVYKTI sales, representing 15% share of the net trade sale. R&D expenses at Legend include costs for conducting clinical trials in US and China for cilta-ce l programs, which was around $210.9 million. R&D expenses for other pipelines were about $125 million. As Legend continued to invest in R&D at the early stage of commercial launch for CARVYKTI, adjusted net loss for the year was about $422.1 million. As of the end of 2022, Legend had a cash position of about $1 billion. Through financing in the secondary market in Q3 last year, Legend raised about $400 million in gross profit. This helped Legend to accelerate cilta-cel early line clinical trials and support our investment in other pipelines. Now I'll turn it back to Sherry to share our long-term planning strategy. Thank you, Shiniu. The group's business growth in 2022 is aligned with our business planning and management focus. Life science business, we will continue to invest in GCT services and products to tap into the rapidly evolving market. We will also upgrade automation capabilities of life science business, increase the throughput of gene oligo protein and peptide business line, and ramp up global capacity to accelerate delivery and support our global business growth. Turning to ProBio, we will stick to our global strategy and increase investment in overseas markets. In the GCT CDMO field, we will strive to maintain our CDMO leadership in China and scale up GMP capacity. We believe that despite challenges in the industry, with our commitment to high quality delivery and technology upgrade, we are able to expand our presence in the international market. On Bestzyme, we will synergize R&D with downstream industrial-grade production and leverage our large-scale industrial fermentation capability accumulated over years. We will continue to optimize our product portfolio, launch more competitive products, and accelerate R&D in the synthetic biology pipelines. For international business, we will strengthen our presence overseas to diversify our revenue stream. On Legend, with recent commercial approval for our first CAR-T drug, CARVYKTI, we will move CARVYKTI into earliest early line clinical trials and actively ramp up capacity, expecting to make this innovative product available to more patients. On other pipelines, Legend will focus on products for solid and liquid tumors, reshaping the landscape of cell therapy. Thanks, Sherry. This concludes today's presentation. Operator, let's open up the phone line Thank you. We will now begin the question-and-answer session. To ask questions on the phone, please press star one one and wait for your name to be announced. If you would like to cancel a request, please press star one one again. As a reminder to ask question, please press star one one. There'll be a short silence while questions are being collected. One moment for the first question. We have the line from Wanhua Wu from CICC. Please ask your question. Okay. Thank you for giving me this opportunity to ask questions. I'm Wanhua Wu from CICC. I have two questions. The first one is, considering the impact of pipeline adjustments and financing difficulties of customers, is there any change we can see in the amount of CDMO? What are the situations of domestic and overseas demand respectively? That's the first question. Thank you. Wanhua, thank you for your question. For your, for comment about, the CDMO environment and customer demand, we'll have Brian answer this question. Hello, this is Brian Min. Thank you for your question. Due to softer market, there is somewhat of a decrease in the rate of our sales. However, we do see increased orders due to some pent-up demand from end of last year. We are seeing some of the growth in the overseas market more so than China market currently, starting with U.S. market, and that we do our current revenue split is 50/50, and we expect to see our overseas business grow faster than China business. Thank you. Okay. Thank you. Thank you. My next question is about what's the proportion of domestic and overseas customers of ProBio? What are the domestic and overseas capacity layout plans? Okay. Well, thank you for the question. We currently our, as I said, our revenue split is about 50/50. Our overseas customer numbers are growing faster than China number of customers. With that, because of increased international business, we are building our plasmid facility in United States, and that is going well currently. While our China facility projects also will be continuing. We don't have any plans to cancel any of the projects. Also, we will be looking at some opportunities for a potential M&A if that is, if we have a very good deal that can be made in the future overseas-wise. Thank you. Okay. May I conclude that the major market and focus of our strategy in the future is in, you know, the overseeing market? There will be more focus. Of course, China market is a, is the most important and major market for us. We will continue to, expand our China market. There will be more focus on the, our international market, especially our U.S. market. Okay. This trend is the same for the biologic CDMO and CGT CDMO, right? That is correct. Okay. Thank you. Thank you so much. Thank you. Thank you for the questions. Once again, to ask questions, please press star one one. One moment for the next question. Next question comes from the line of Jay Lee from Morningstar. Please ask your question. Hello, good morning, and congratulations on these results. I think investors should be happy to see the continued improvement in the operating margins across the Life Science businesses and also the progress in Legend Biotech's clinical trials. I have just two quick questions. First is also about ProBio's CDMO segment. I noticed that the backlog only grew around 18.2%, which is a little bit of a slowdown compared to previous years. I just wanna get some color. You know, I think you gave some guidance on what growth might be for the, for next year, but just wanna get some color on how the backlog might correlate with growth beyond 2023. The second question is for the company as a whole, across those Life Science, and also the CDMO businesses, what does employee headcount and hiring plans look like? Can you give me guidance on whether you're looking to grow, hire more people, or keep employment flat? Thank you. Thank you, Jay. I will take a first cut to this question and have Brian supplement if needed. First, in terms of backlog, you are right. Total backlog grew 18%. However, the fee for service backlog grew faster, 21% year-over-year. The growth of backlog is constrained by two factors. Number one, we did see some softness in the market, especially in China. I think that's well understood. Secondly, as you already know, we are still building our large commercial scale manufacturing capacity. Therefore, some of the larger deals, we will have to wait until the commercial manufacturing capacity is online. We do expect backlog growth beyond 2023 to accelerate once the capacity is online. Hope that helps. Secondly, in terms of questions on headcount for CDMO business, we have roughly about 1,000 people there, but we are very aggressively increasing our efficiency, especially on labor. We do expect headcount to grow slower than our revenue grows. Thank you very much. Yeah. Hi. Yeah. Hello, this is Brian. I think backlog growth we already covered. It's due to the softness of the market. It's, the growth rate is somewhat flat. Looking at the current orders that we are working on, I think we do expect our 2023 revenue growth to be in the upwards of 30%. We do not see that much softness, but we are for the year, we are on track for about 30% upwards growth. In terms of people, we are still hiring our key people, and we're going to continue to hire based on the market needs. Thank you. Thank you for the questions. At this time, there are no further questions at that time. I would like to hand it back to the management. Thanks, Desmond. Thanks to all the shareholders, investors, and analysts for your continued support and care. If you have any more questions, please feel free to contact our IR team. We'll see you on the next call. Thanks. That concludes today's conference call. Thank you for your participation. You may now disconnect.