Duality Biotherapeutics Annual Report 2025: Key Highlights and Investor Insights

1. Major Corporate Developments and Price-Sensitive Events

• Proposed RMB Share Issue on Shanghai Stock Exchange:
  • On April 13, 2026, the Board approved a plan to issue ordinary shares denominated in RMB, to be listed and traded on the Science and Technology Innovation Board (“Sci-Tech Board”) of the Shanghai Stock Exchange.
  • This proposed RMB Share Issue remains subject to market conditions, shareholder approval at a general meeting, and regulatory approvals. As of the date of the annual report, no application has yet been submitted to regulators, and the plan may be updated in accordance with laws and regulations.
  • Potential Impact: Dual listing and capital raising in mainland China can significantly impact the Company’s funding, investor base, and valuation. Investors should closely monitor further announcements.
• Material Litigation:
  • The Company is involved in three legal proceedings in China concerning alleged ownership rights over certain patent applications. In December 2025, the Company received favorable first-instance judgments. The plaintiff has appealed, and cases are pending.
  • IP counsel and the Board believe the claims are without merit and unlikely to succeed, and do not expect material impact on R&D, business operations, or financial performance. However, any adverse outcome could affect valuation and business prospects.
• Listing and Capital Structure:
  • Duality Biotherapeutics listed on the Main Board of the Hong Kong Stock Exchange on April 15, 2025. The Company raised approximately RMB1.75 billion in gross proceeds, with additional RMB228 million from the exercise of the over-allotment option.
  • No convertible bonds have been issued, no treasury shares were held at year-end, and no debentures were issued in 2025.
• Share Incentive Schemes:
  • The Company adopted the 2025 Share Scheme and maintains a substantial Pre-IPO Equity Incentive Plan. As of the report date, 18.6 million shares (approx. 20.6% of issued capital) remain available for issuance under the pre-IPO plan.
  • No awards have yet been granted under the new 2025 Share Scheme. Any future significant grants, particularly to Directors or substantial shareholders, would require shareholder approval if thresholds are exceeded.

2. Financial Performance and Position

• Financial Results:
  • For the year ended December 31, 2025, the Group recorded a net other loss of RMB31.9 million, compared to a net other gain of RMB14.4 million in 2024. The change is mainly due to Renminbi appreciation and foreign exchange fluctuations.
  • Finance income (mainly bank interest) grew substantially to RMB99.3 million (2025) from RMB48.1 million (2024), reflecting higher cash balances post-listing.
  • Finance costs rose to RMB1.2 million, driven by higher bank borrowing and note discounting costs.
  • Share-based payment expense was material at RMB156 million in 2025, reflecting ongoing talent incentive programs.
• Liquidity and Capital Resources:
  • The Company reported a strong current ratio of 3.6 at year-end (2024: 0.5), reflecting a robust liquidity position after the IPO.
  • Management believes available funds are sufficient for working capital and capital expenditure needs in 2026. There was a balance of unutilized net proceeds from the Global Offering and pre-IPO financing at year-end.
• Use of Proceeds:
  • Proceeds from the Hong Kong IPO are being utilized as planned, with further details in the “Use of Proceeds from the Global Offering” section of the report.

3. Strategic Direction and Business Priorities

• Product Pipeline and Core Assets:
  • The Company is focused on innovative Antibody-Drug Conjugate (ADC) therapies for cancer and autoimmune diseases.
  • Key priorities include late-stage development and launch preparation for Core Products DB-1303 and DB-1311, maturing the clinical pipeline, and advancing proprietary ADC technology platforms.
  • Disciplined capital and operational management remain a central theme to maximize value creation.
• Risks and Uncertainties:
  • The Company’s performance is highly dependent on the success of its drug candidates and faces risks such as clinical trial setbacks, regulatory challenges, intense competition, and the possibility of resource misallocation.
  • Investors are advised to consider these risks carefully and consult their own advisors prior to investment decisions.
• ESG and Compliance:
  • The Board oversees Environmental, Social and Governance (ESG) matters. The Company was not aware of any material adverse ESG incidents in the reporting period.
  • Compliance with all relevant laws and regulations is reported, including the Listing Rules and Corporate Governance Code.

4. Corporate Governance and Shareholder Information

• Shareholder Communications:
  • Duality Biotherapeutics has implemented various channels for shareholder communication, including its website, WeChat platform, hotline, and IR mailbox. The Company encourages direct engagement with shareholders and provides timely disclosures as required by the Listing Rules.
• Dividend Policy:
  • The Board does not recommend any final dividend for 2025, and the Company currently expects to retain all earnings for business operations and expansion. There is no dividend policy or intention to declare cash dividends in the near future.
• Board and Management Remuneration:
  • The Remuneration Committee oversees director and senior management compensation. No director or top-five-paid individual received inducement or compensation for loss of office in 2025.
• Audit and Internal Controls:
  • PricewaterhouseCoopers audited the 2025 financial statements. Total auditor remuneration was RMB3.56 million, including RMB859,000 for tax services. The Board and Audit Committee reviewed internal controls and risk management systems and found them effective and adequate.

5. Other Noteworthy Items

• Employee Growth and Cost:
  • Employee headcount increased from 170 (2024) to 231 (2025), reflecting expansion. Total staff costs were RMB395.4 million (2025), up from RMB355.5 million (2024).
• Charitable Contributions:
  • The Group made charitable donations totaling RMB0.2 million in 2025.
• No Material Connected Transactions:
  • No connected transactions requiring disclosure under Chapter 14A of the Listing Rules occurred in 2025.

Conclusion

The 2025 Annual Report of Duality Biotherapeutics contains several price-sensitive developments:

• The proposed RMB Share Issue and potential dual listing in Shanghai are highly significant and could broaden the investor base and improve capital access.
• Ongoing IP litigation, although currently not expected to have a material impact, could affect the Company if appeals succeed.
• Strong liquidity and prudent financial management post-IPO position the Company well for upcoming R&D and commercialization efforts.
• No dividend is expected in the near term as the Company reinvests in growth.

Investors should monitor further announcements regarding the RMB Share Issue, litigation outcomes, and pipeline progress, as these may impact future valuation and share price.

Disclaimer: This summary is for informational purposes only and does not constitute investment advice. Investors should refer to the full annual report and consult their own financial advisors before making investment decisions. The author and publisher are not responsible for any investment actions taken based on this article.

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