Liantuo Biology ADR 2025 Annual Report

LianBioConsolidated Statement of Operations and Comprehensive Income (Loss)(In thousands, except share and per share amounts) 1.Nature of Business LianBio (“LianBio” or the “Company”) is a clinical stage biopharmaceutical company dedicated to bringinginnovative medicines to patients with unmet medical needs in Asia. The Company’s initial focus is to in-license assets fordevelopment and commercialization in Greater China and other Asian markets. The Company was incorporated in the 2.Significant Accounting Policies (A)Basis of presentation The Company’s consolidated financial statements have been prepared in conformity with accounting principlesgenerally accepted in the United States of America (“U.S. GAAP”). Any reference in these notes to applicable guidance ismeant to refer to the authoritative GAAP as found in the Accounting Standards Codification (“ASC”) and Accounting The accompanying consolidated financial statements include the accounts of the Company and its wholly ownedsubsidiaries, which include the People’s Republic of China (“PRC”) registered entities directly owned by the Company. All (B)Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires the Company’s management tomake estimates and assumptions that affect the reported financial position at the date of the financial statements and thereported results of operations during the reporting period. Such estimates and assumptions affect the reported amounts ofassets, liabilities, and expenses, and disclosure of contingent assets and liabilities in the consolidated financial statements (i)Liquidity The Company had an accumulated deficit of $151.7 million as of December 31, 2025 and $156.6 million as ofDecember 31, 2024. The Company’s cash and cash equivalents were $9.4 million and $51.7 million as of December 31,2025 and December 31, 2024, respectively. The Company has financed its operations to date primarily through equitycapital raises. On June 20, 2025 the Company issued a special cash dividend to shareholders of record on June 30, 2025 inthe amount of $47.3 million or $0.43 per share. On March 14, 2024 the Company issued a special cash dividend to (C)Net loss per share Basic net income (loss) per share is computed by dividing net income (loss) by the weighted average number ofordinary shares outstanding for the period. Diluted net income (loss) per share is computed by dividing the net lossattributable to common stockholders by the weighted average number of ordinary shares outstanding for the perioddetermined using the treasury stock method. During periods in which the Company incurs net losses, both basic and dilutedloss per share is calculated by dividing the net loss by the weighted average shares outstanding—potentially dilutive (D)Fair Value of Financial Instruments FASB guidance specifies a hierarchy of valuation techniques based on whether the inputs to those valuationtechniques are observable or unobservable. Observable inputs reflect market data obtained from independent sources, whileunobservable inputs reflect market assumptions. The hierarchy gives the highest priority to unadjusted quoted prices in The three levels of the fair value hierarchy are as follows: a.Level 1 – Unadjusted quoted prices in active markets for identical assets or liabilities that the reporting entityhas the ability to access at the measurement date. Level 1 primarily consists of financial instruments whosevalue is based on quoted market prices such as exchange-traded instruments and listed equities.b.Level 2 – Inputs other than quoted prices included within Level 1 that are observable for the asset or liability,either directly or indirectly (e.g., quoted prices of similar assets or liabilities in active markets, or quotedprices for identical or similar assets or liabilities in markets that are not active). Level 2 includes financial (E)Cash and Cash Equivalents The Company considers all highly liquid investments with a maturity of 90 days or less at the time of purchase to becash equivalents. Cash equivalents are carried at cost which approximates fair value due to their short-term nature. The A summary of cash, cash equivalents and restricted cash is as follows: Cash and cash equivalents The Company continues to collect outstanding receivables as part of the wind down process. The Company expectsto distribute these proceeds to its then-current shareholders in a subsequent distribution before the final dissolution of the (F)Marketable Securities The Company considers securities with original maturities of greater than 90 days to be available for sale securities.Securities under this classification are recorded at fair value and unrealized gains and losses within accumulated othercomprehensive income (loss). The estimated fair value of the available for sale securities is determined based on quotedmarket prices or rates for similar instruments. In addition, the cost of debt securities in this cate