CORPORATE HEADQUARTERS

We were incorporated under Delaware law in 1991. In 2012, with new leadership, the Company shifted its business strategy to China and has since built an infrastructure in China that includes sales and marketing, medical affairs, regulatory and clinical development and in the foreseeable future, distribution and manufacturing. The Company was restructuredmajority of the Company’s operations are now located in 2012 and implemented a name change in 2014 to “CASI Pharmaceuticals, Inc.”China. Our principal executive offices are located at 9620 Medical Center Drive, Suite 300, Rockville, Maryland 20850, and our telephone number is (240) 864-2600. Our wholly-owned subsidiary, CASI China, is headquartered in Beijing, China and CASI Wuxi is headquartered in Wuxi, China. We also leaseconduct substantially all of our China commercial, regulatory and related operations through CASI China and our operations in Wuxi through CASI Wuxi. CASI China’s headquarters are located at 1701-1702, China Central Office Tower 1, No.81 Jianguo Road, Chaoyang District, Beijing, 100025 China.

In 2020, we leased office space in Beijing,Shanghai, China to accommodate our growing staff in that region.  Our address in Shanghai is No. 2904, Shengbang International, North Sichuan Road, Hongkou District, Shanghai, China.

Management decisions are primarily being made out of CASI China where our Chinaexecutive team spends a substantial amount of time.

CHINA OPERATIONS

The majority of our operations are based,now located in China and also lease laboratory spaceare conducted primarily through two of our subsidiaries: (i) CASI Pharmaceuticals (China) Co., Ltd. (“CASI China”), a directly wholly owned subsidiary established in Beijing, China which serves as our R&D Center.

CHINA OPERATIONS

In August 2012 weand located in Beijing. CASI China is responsible for our day-to-day operations, development and commercialization of our product and (ii) CASI Pharmaceuticals (Wuxi) Co., Ltd. (“CASI Wuxi”), a directly wholly owned subsidiary established in November 2018 and located in Wuxi Huishan Economic Development Zone. CASI Wuxi was incorporated as the holding company for CASI’s R&D center, distribution center and manufacturing facilities. CASI Wuxi has a lease on industrial land, for 7.33 hectare. In December 2018, CASI Wuxi established a wholly-owned China-basednew subsidiary CASI Biopharmaceuticals as an investment platform for Chinese pharmaceutical asset acquisition or cooperation.

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We have about 168 FTEs in China. Over 100 employees are dedicated to commercial operations, which mainly account for EVOMELA’s sales and an office in Beijing,marketing activities. The clinical and in 2014, established a R&D Center in Beijing. The Company also established a wholly-owned domestic China based subsidiary under which our preclinical activities are operated. Our staff in Beijing currently consists of 43 full-time employees and 1 part-time employee. Among its activities, our Beijing operations help toregulatory team has 18 FTEs, who oversee the Company’s local preclinical and clinical operation activities, as well as its CFDAoperations, and NMPA regulatory activities. In addition,The Wuxi R&D and manufacturing center has 24 employees at the Beijing operations provide supportcurrent stage, and the team size will expand according to our business development activities.the progress of the facility’s construction.

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AVAILABLE INFORMATION

Through our website atwww.casipharmaceuticals.com, we make available, free of charge, our filings with the SEC, including our annual proxy statements, annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K, and all amendments thereto, as soonas reasonably practicable after such reports are filed with or furnished to the SEC. Additionally, our board committee charters and code of ethics are available on our website. We intend to post to this website all amendments to the charters and code of ethics. Our filings are also available through the SEC via their website,http://www.sec.gov. You may also read and copy any materials we file with the SEC at the SEC’s Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549. You may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. The information contained on our website is not incorporated by reference in this Annual Report on Form 10-K (this “Annual Report”) and should not be considered a part of this report.

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This section includes the most significant factors that we believe may adversely affect our business and operations. Before making an investment decision, you should carefully consider the risks described below, and all other information contained or incorporated by reference in our filings with the SEC. We expect to update these Risk Factors from time to time in the periodic and current reports that we file with the SEC. Please refer to these subsequent reports for additional information relating to the risks associated with investing in our common stock. If any of such risks and uncertainties actually occurs, our business, financial condition, and results of operations could be severely harmed. This could cause the trading price of our common stock to decline, and you could lose all or part of your investment.

Risk Factors Summary

Risks Relating to our Financial Position and Need for Additional Capital

Risks Relating to Our Business

Risks Relating to Our Reliance on Third Parties

Risks Related to Extensive Government Regulation

Risks Relating to Our Intellectual Property

Risks Relating to Our Common Stock

Risks Relating to Our Auditor

Risks Relating to Our Business Operations in China

General Risk Factors

Risks Relating to our Financial Position and Need for Additional Capital

If we do not regain compliance with the Nasdaq bid price rule, our common stock would be delisted from the Nasdaq Capital Market, which would impair our ability to raise capital and the liquidity of our common stock could be adversely affected.

Our listing on the Nasdaq Capital Market is contingent upon meeting all the continued listing requirements of the Nasdaq Capital Market.

On December 30, 2021, CASI received a deficiency letter from the Listing Qualifications Department (the “Staff”) of the Nasdaq Stock Market (“Nasdaq”) notifying CASI that, for the previous 30 consecutive business days, the bid price of CASI’s common stock had closed below the minimum $1.00 per share requirement for continued inclusion on the Nasdaq Capital Market pursuant to Nasdaq Listing Rule 5550(a)(2) (the “Bid Price Rule”).

The Nasdaq deficiency letter has no immediate effect on the listing of CASI’s common stock on the Nasdaq Capital Market.

In accordance with Nasdaq Listing Rule 5810(c)(3)(A) (the “Compliance Period Rule”), CASI has been provided an initial period of 180 calendar days, or until June 28, 2022 (the “Compliance Date”), to regain compliance with the Bid Price Rule. If, at any time before the Compliance Date, the bid price for CASI’s common stock closes at $1.00 or more per share for a minimum of 10 consecutive business days, as required under the Compliance Period Rule, the Staff will provide written notification to CASI that it complies with the Bid Price Rule, unless the Staff exercises its discretion to extend this 10-day period pursuant to Nasdaq Listing Rule 5810(c)(3)(H).

If CASI does not regain compliance with the Bid Price Rule by the Compliance Date, CASI may be eligible for an additional 180 calendar day compliance period (the “Second Compliance Period”). To qualify, CASI would need to meet the continued listing requirement for the market value of publicly held shares and all other initial listing standards of the Nasdaq Capital Market, with the exception of the Bid Price Rule, and provide written notice to the Staff of its intention to cure the deficiency during the Second Compliance Period by effecting a reverse stock split, if necessary.

However, if CASI does not regain compliance with the Bid Price Rule by the Compliance Date and it appears to the Staff that CASI will not be able to regain compliance with the Bid Price Rule during the Second Compliance Period, or CASI is otherwise not eligible for the Second Compliance Period, then Nasdaq will provide notice to CASI that CASI’s common stock will be subject to delisting. At that time, CASI may appeal the Staff’s delisting determination to a Nasdaq Listing Qualifications Panel (the “Panel”). CASI expects that its common stock would remain listed pending the Panel’s decision. There can be no assurance that, if CASI does appeal the Staff’s delisting determination to the Panel, such appeal would be successful.

CASI intends to actively monitor the closing bid price of its common stock between now and the Compliance Date and will consider available options, including a reverse stock split. In order to make available the option of a reverse stock split, CASI may submit a reverse stock split proposal to its stockholders at a special meeting of stockholders or its next annual meeting of stockholders. However, there can be no assurance that the reverse stock split will be approved or that CASI will be able to regain compliance with the Bid Price Rule. If our common stock is delisted from the Nasdaq Capital Market, our ability to raise capital in the future may be limited. Delisting could also result in less liquidity for our stockholders and a lower stock price.

If our common stock is delisted by Nasdaq, our common stock may be eligible to trade on the OTC Bulletin Board or another over-the-counter market. Any such alternative would likely result in it being more difficult for us to raise additional capital through the public or private sale of equity securities and for investors to dispose of, or obtain accurate quotations as to the market value of, our common stock. In addition, there can be no assurance that our common stock would be eligible for trading on any such alternative exchange or markets.

We Have a History of Losseshave incurred significant operating losses since inception and Anticipate Future Lossesanticipate that we will continue to incur operating losses for the foreseeable future and May Never Become Profitable on a Sustained Basismay never achieve or maintain profitability.

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To date, we have been engaged primarily in research and development activities. Although in the past we have received limited revenues on royalties from the sales of pharmaceuticals, license fees and research and development funding from a former collaborator and limited revenues from certain research grants,Previously, we have not derived significant revenues from operations.

operations; however, in the years ended December 31, 2021 and 2020, we had EVOMELA^® sales totaling $30.0 million and $15.0 million, respectively.

We have experienced losses in each year since inception. Through December 31, 2017,2021, we had an accumulated deficit of approximately $452.7$605.6 million. We expect that we will seek to raise capital to continue our operations and, although we have been successfully funded to date through the sales of our equity securities, and through limited royalty payments, there is no assurance that our capital-raising efforts will be able to attractmay not produce the funding needed to sustain our operations. If we are unable to obtain additional funding for operations, we may not be able to continue operations as proposed, requiring us to modify our business plan, curtail various aspects of our operations or cease operations. In any such event, investors may lose a portion or all of their investment.

We expect that our ongoing preclinical, clinical, marketing and corporate activities will result in operating losses for the foreseeable future before we commercialize any products, if ever.future. In addition, to the extent we rely on others to develop and commercialize our products, our ability to achieve profitability will depend upon the success of these other parties. To support our research and development of certain product candidates, we may seek and rely on cooperative agreements from governmental and other organizations as a source of support. If a cooperative agreement were to be reduced to any substantial extent, it may impair our ability to continue our research and development efforts. EvenTo become and remain profitable, we must successfully commercialize one or more product candidates with significant market potential. This will require us to be successful in a range of challenging activities, including completing clinical trials of our product candidates, developing commercial scale manufacturing processes, obtaining marketing approval, manufacturing, marketing and selling any current and future product candidates for which we may obtain marketing approval, and satisfying any post-marketing requirements. We may never succeed in any or all of these activities and, even if we do, we may never generate sufficient revenue to achieve profitability,profitability.

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The success of CASI Wuxi is subject to uncertainty and may increase our losses, be difficult to accomplish, take longer than expected or require us to obtain additional financing.

We intend to invest $80 million in CASI Pharmaceuticals (Wuxi) Co., Ltd., that is building a manufacturing facility in the Wuxi Huishan Economic Development Zone in Jiangsu Province, China. Since the construction began, we have incurred capital expenditures of $12.1 million. CASI Wuxi will also operate the facility upon completion. As of December 31, 2021, we have invested $31 million in cash, transferred selected ANDAs valued at $30 million and will invest an additional $19 million in cash in the future. The Company’s total investment is intended to account for 80% of the equity of the CASI Wuxi. CASI Wuxi may not achieve the expected goal as the planned manufacturing facility will not be entirely within our control. It can take years to build and establish a new manufacturing facility.

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Once built, the new facility might fail validation or not meet regulatory standards for a commercial manufacturing facility. In addition, we may not obtain or retain the requisite legal permits to manufacture in China, and costs or operational limitations may be imposed in connection with obtaining and complying with such permits. Our ability to establish and operate a manufacturing facility in China may be adversely affected by changes in Chinese laws and regulations such as those related to, among other things, taxation, import and export tariffs, environmental regulations, land use rights, intellectual property, employee benefits and other matters. The success of CASI Wuxi also relies on our ability to make additional payments in the future, which is uncertain. Our plan may require us to obtain additional debt or equity financing, resulting in additional debt obligations, increased interest expense or dilution of equity ownership. If we are unable to establish a new manufacturing facility, purchase equipment, hire adequate personnel to support our manufacturing efforts or implement necessary process improvements, we may be unable to sustainproduce commercial materials or increase it.

Our Common Stock Could Be Delisted From The NASDAQ Capital Market, Which Could Affect Our Common Stock’s Market Price and Liquidity.

Our listing on the NASDAQ Capital Market is contingent upon meeting all the continued listing requirementsmeet demand, if any should develop, for our product candidates. Any one of the NASDAQ Capital Market. In the past, we have received written notices from NASDAQ for failingfactors cited above, or a combination of them, could result in unanticipated costs, which could materially and adversely affect our business and planned operations and earnings in China.

The current capital and credit market conditions may adversely affect our access to maintain a minimum bid pricecapital, cost of not less than $1.00 per sharecapital, and a minimum of $2.5 million in stockholders’ equity. Although we have regained compliance with NASDAQ’S continued listing standards, there can be no assurance that we will remain in compliance in the future.

If our common stock is delisted from the NASDAQ Capital Market, our ability to raise capital in the future may be limited. Delisting could also result in less liquidity for our stockholders and a lower stock price.

We May Engage in Strategic and Other Corporate Transactions, Which Could Negatively Affect Our Financial Condition and Prospects

We may consider strategic and other corporate transactions as opportunities present themselves. There are risks associated with such activities. These risks include, among others, incorrectly assessing the quality of a prospective strategic partner, encountering greater than anticipated costs in integration, being unable to profitably deploy assets acquired in the transaction, such as drug candidates, possible dilution to our stockholders, and the loss of key employees due to changes in management. Further, strategic transactions may place additional constraints on our resources by diverting the attention of our management fromexecute our business operations. To the extent we issue securities in connection with additional transactions, these transactions and related issuances may have a dilutive effect on earnings per share and our ownership. Our financial condition and prospects after an acquisition depend in part on our ability to successfully integrate the operations of the acquired business or technologies. We may be unable to integrate operations successfully or to achieve expected cost savings. Any cost savings which are realized may be offset by losses in revenues or other charges to earnings.

The Current Capital and Credit Market Conditions May Adversely Affect the Company’s Access to Capital, Cost of Capital, and Ability to Execute its Business Planplan as Scheduled

scheduled.

Access to capital markets is critical to our ability to operate. Traditionally, biopharmaceutical companies (such as we)we have funded their research and development expenditures throughour operations by raising capital in the equity markets. Declines and uncertainties in these markets over the past few years have severely restricted raising new capital in amounts sufficient to conduct our current operations and have affected our ability to continue to expand or fund research andadditional development efforts with our product candidates.efforts. We require significant capital for research and development for our product candidates, clinical trials, and clinical trials. In recent years, the general economic and capital market conditions in the United States have deteriorated significantly and have adversely affected our access to capital and increased the cost of capital, and there is no certainty that a recovery in the capital and credit markets, enabling us to raise capital in an amount to sufficiently fund our short-term and long-term plans, will occur in 2018. If these economic conditions continue or become worse, our future cost of equity or debt capital and access to the capital markets could be adversely affected. In addition, ourmarketing activities. Our inability to access the capital markets on favorable terms because of our low stock price, or upon our delisting from the NASDAQNasdaq Capital Market if we fail to satisfy a listing requirement, could affect our ability to execute our business plan as scheduled. Moreover, we rely and intend to rely on third parties, including our clinical research organizations, third party manufacturers, and certain other important vendors and consultants. As a result of the current volatile and unpredictable global economic situation, there may be a disruption or delay in the performance of our third-party contractors and suppliers. If such third parties are unable to adequately satisfy their contractual commitments to us in a timely manner, our business could be adversely affected.

We Do Not Have Any Active Revenue Streamshave limited revenue streams and We Are Uncertain Whether Additional Funding Will Be Available For Our Future Capital Needswe are uncertain whether additional funding will be available for our future capital needs and Commitments.commitments. If We Cannot Raise Additional Funding,we cannot raise additional funding, or Accessaccess the Capital Markets, We May Be Unablecapital markets, we may be unable to Complete Developmentcomplete the development and commercialization of Our Product Candidates

our products and product candidates.

We will require substantial funds in addition to our existing working capital to develop and commercialize our products and product candidates and to otherwise to meet our business objectives. We have never generated sufficient revenue during any period since our inception to cover our expenses and have spent, and expect to continue to spend, substantial funds to continue our clinical development programs.programs and commercialization of our products and product candidates. Any one of the following factors, among others, could cause us to require additional funds or otherwise cause our cash requirements in the future to increase materially:

At December 31, 2017,2021, we had cash and cash equivalents of approximately $43.5$38.7 million. We may continue to seek additional capital through public or private financing or collaborative agreements in 20182021 and beyond. Our operations require significant amounts of cash. We may be required to seek additional capital for the future growth and development of our business. We can give no assurance as to the availability of such additional capital or, if available, whether it would be on terms acceptable to us. In addition, we may continue to seek capital through the public or private sale of securities, if market conditions are favorable for doing so. If we are successful in raising additional funds through the issuance of equity securities, stockholders will likely experience substantial dilution. If we are not successful in obtaining sufficient capital because we are unable to access the capital markets on favorable terms, it could reduce our research and development efforts and materially adversely affect our future growth, results of operations and financial results. There can be no assurance that we would be able to obtain any required financing on a timely basis or at all.

If we decide to rely on third parties to manufacture, sell, market and distribute our products and product candidates, we may not be successful in entering into arrangements with such third parties or may be unable to do so on terms that are favorable to us. In addition, our product revenues and our profitability, if any, may be lower if we rely on third parties for these functions than if we were to market, sell and distribute any products that we develop ourselves. We likely will have little control over such third parties, and any of them may fail to devote the necessary resources and attention to sell and market our products effectively. If we do not establish sales, marketing and distribution capabilities successfully, either on our own or in collaboration with third parties, we will not be successful in commercializing our product candidates, which would adversely affect our business and financial condition.

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Developments By Competitors May RenderWe are substantially dependent on the commercial success of EVOMELA™. Our Products Obsoletemedicine may fail to achieve and maintain the degree of market acceptance by physicians, patients, third-party payors, and others in the medical community necessary for commercial success.

The success of our business is substantially dependent on our ability to successfully commercialize EVOMELA. On December 3, 2018, we received the NMPA approval for importation, marketing and sales in China for EVOMELA^®, and on August 12, 2019, we announced the commercial launch of EVOMELA^® in China. We will continue to spend our time, resources and efforts on the commercialization of EVOMELA^® in China.

Reimbursement and hospital listing may be the most critical market access factors for our commercialization success in China. The NRDL is updating on annual basis via a negotiation mechanism. Although participating the NRDL pricing negotiation is voluntarily, it usually results significant price discount. The Company has no intention to list EVOMELA^® in the NRDL any time before a direct competitor’s compound commercially launch, therefore, our market will be limited given only a small portion of the Chinese population would be able to afford EVOMELA^® through self-pay.

The government owned hospitals in China usually restrict the drug use outside the hospital formulary. Therefore, been listed in hospital formulary is critical. In order to list in the hospital formulary, the Company must participate the provincial level tendering process. Wining the tendering does not guarantee the hospital listing. If we were unable to quickly add EVOMELA^® to hospitals’ formulary, doctors and patients will have limited access to EVOMELA^® through hospital pharmacies, the demand for EVOMELA^®, and the revenues from EVOMELA^® will be materially and adversely affected. On the other hand, patients are able to purchase EVOMELA with the prescription from the physician from pharmacies the product is not available in the hospital, however, the hospitals do not encourage such activities.

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We currently rely on a single source for our supply of EVOMELA which has high risk of supply chain disruption

We currently rely on a single source for our supply of EVOMELA^®. Early in the COVID-19 pandemic we experienced a disruption to our supply chain for EVOMELA^®, we have experienced minimal supply disruptions in 2021.  However, if suppliers refuse or are unable to provide products for any reason (including the occurrence of an event like the COVID-19 pandemic that makes delivery impractical), we would have to work with Acrotech to negotiate an agreement with a substitute supplier, which would likely interrupt further manufacturing of EVOMELA^®, cause delays or increase our costs.

Our business has been and may continue to be adversely affected by the current COVID-19 pandemic and could be impacted by future COVID-19 variants and other outbreaks of contagious diseases

The COVID-19 pandemic has adversely affected, and may continue to adversely affect, the economies and financial markets of many countries, which may result in a period of regional, national, and global economic slowdown or regional, national, or global recessions that could affect our ability to continue to commercialize and expand distribution of EVOMELA^® (Melphalan For Injection) or other drugs in our existing product pipeline. Early in the COVID-19 pandemic we experienced a disruption to our supply chain for EVOMELA®, we have experienced no supply disruption in 2021; however, there can be no assurance that restrictions will not be

imposed again. In addition, economic and other uncertainties may adversely affect other parties’ willingness to negotiate and execute product licenses and thus hamper our ability to in-license clinical-stage and late-stage drug candidates in China or elsewhere.

Clinical trials, whether planned or ongoing, may be affected by the COVID-19 pandemic. Our partner, Juventas, experienced some delay in the start of the CNCT19 clinical trials due to the COVID-19 pandemic. The COVID-19 pandemic has also impacted our targeted start time of our CID-103 trial due to the lock-down of many medical facilities in Europe. Study procedures (particularly any procedures that may be deemed non-essential), site initiation, participant recruitment and enrollment, participant dosing, shipment of our product candidates, distribution of clinical trial materials, study monitoring, site inspections and data analysis may be paused or delayed due to changes in hospital or research institution policies, federal, state or local regulations, prioritization of hospital and other medical resources toward COVID-19 efforts, or other reasons related to the pandemic. In addition, there could be a potential effect of COVID-19 on the operations of the health regulatory authorities, which could result in delays of reviews and approvals, including with respect to our product candidates. Any prolongation or de-prioritization of our clinical trials or delay in regulatory review resulting from such disruptions could materially affect the development and study of our product candidates.

The existence of counterfeit pharmaceutical products in pharmaceutical markets may compromise our brand and reputation and have a material adverse effect on our business, operations and prospects.

Counterfeit products, including counterfeit pharmaceutical products, are a significant problem, particularly in China. Counterfeit pharmaceuticals are products sold or used for research under the same or similar names, or similar mechanism of action or product class, but which are sold without proper licenses or approvals. Such products may be used for indications or purposes that are not recommended or approved or for which there is no data or inadequate data with regard to safety or efficacy. Such products divert sales from genuine products, often are of lower cost, often are of lower quality (having different ingredients or formulations, for example), and have the potential to damage the reputation for quality and effectiveness of the genuine product. If counterfeit pharmaceuticals illegally sold or used for research result in adverse events or side effects to consumers, we may be associated with any negative publicity resulting from such incidents. Consumers may buy counterfeit pharmaceuticals that are in direct competition with our pharmaceuticals, which could have an adverse impact on our revenues, business and results of operations. In addition, the use of counterfeit products could be used in non-clinical or clinical studies, or could otherwise produce undesirable side effects or adverse events that may be attributed to our products as well, which could cause us or regulatory authorities to interrupt, delay or halt clinical trials and could result in the delay or denial of regulatory approval by the FDA or other regulatory authorities and potential product liability claims. With respect to China, although the government has recently been increasingly active in policing counterfeit pharmaceuticals, there is not yet an effective counterfeit pharmaceutical regulation control and enforcement system in China. As a result, we may not be able to prevent third parties from selling or purporting to sell our products in China. The proliferation of counterfeit pharmaceuticals has grown in recent years and may continue to grow in the future. The existence of and any increase in the sales and production of counterfeit pharmaceuticals, or the technological capabilities of counterfeiters, could negatively impact our revenues, brand reputation, business and results of operations.

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We face significant competition from other biotechnology and pharmaceutical companies and our business will suffer if we fail to compete effectively.

If competitors were to develop superior drug candidates, our products could be rendered noncompetitive or obsolete, resulting in a material adverse effect to our business. Developments in the biotechnology and pharmaceutical industries are expected to continue at a rapid pace. Success depends upon achieving and maintaining a competitive position in the development of products and technologies. Competition from other biotechnology and pharmaceutical companies can be intense. Many competitors have substantially greater research and development capabilities, marketing, financial and managerial resources and experience in the industry. Even if a competitor creates a product that is not superior, we may not be able to compete.

In the generic products market, we face competition from other generic pharmaceutical companies, which may impact our selling price and revenues from such products. The FDA approval process often results in the FDA granting final approval to a number of ANDAs for a given product at the time a patent for a corresponding brand product or other market exclusivity expires. This may force us to face immediate competition when we seek to introduce a generic product into the market. If competition from other generic pharmaceutical companies intensifies, revenues may decline.

The availability of our competitors’ products could limit the demand, and the price we are able to charge, for product candidates we develop. We Must Showwill not achieve our business plan if the Safety and Efficacy of Our Product Candidates Through Clinical Trials, the Results of Which are Uncertain

Before obtaining regulatory approvals for the commercial saleacceptance of our products we must demonstrate, through preclinical studies (animal testing) and clinical trials (human testing), thatis inhibited by price competition or reimbursement issues or if physicians switch to other new drug products or choose to reserve our proposed products are safe and effectiveproduct candidates for use in each target indication. Testing of our product candidates will be required, and failure can occur at any stage of testing. Clinical trials may not demonstrate sufficient safety and efficacylimited circumstances. The inability to obtain the required regulatory approvalscompete with existing or result in marketable products. The failure to adequately demonstrate the safety and efficacy ofsubsequently introduced drug products would have a product under development could delay or prevent regulatory approval of the potential product.

Clinical trials for the product candidates we are developing may be delayed by many factors, including that potential patients for testing are limited in number. The failure of any clinical trials to meet applicable regulatory standards could cause such trials to be delayed or terminated, which could further delay the commercialization of any of our product candidates. Newly emerging safety risks observed in animal or human studies also can result in delays of ongoing or proposed clinical trials. Any such delays will increase our product development costs. If such delays are significant, they could negatively affect our financial results and the commercial prospects for our products.

Compliance with Ongoing Post-marketing Obligations for Our Approved ANDAs and NDAs May Uncover New Safety Information that Could Give Rise to a Product Recall, Updated Warnings, or Other Regulatory Actions that Could Have an Adverse Impactmaterial adverse impact on Our Business.

After the FDA approves a drug for marketing under an NDA or ANDA, the product’s sponsor must comply with several post-marketing obligations that continue until the product is discontinued. These post-marking obligations include the prompt reporting of serious adverse events to the agency, the submission of product-specific annual reports that include changes in the distribution, manufacturing, and labeling information, and notification when a drug product is found to have significant deviations from its approved manufacturing specifications (among others). Our ongoing compliance with these types of mandatory reporting requirements could result in additional requests for information from the FDA and, depending on the scope of a potential product issue that the FDA may decide to pursue, potentially also result in a request from the agency to conduct a product recall or to strengthen warnings and/or revise other label information about the product. Any of these post-marketing regulatory actions could materially affect our sales and, therefore, they have the potential to adversely affect our business, financial condition resultsand prospects.

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We may need new collaborative partners to further develop and cash flows.

The Success of Our Business Depends Uponcommercialize products, and if we enter into such arrangements, we may lose control over the Members of Our Senior Management Team, Our Clinical Development Expertise in Both U.S.development and China, and Our Ability to Continue to Attract and Retain Qualified Clinical, Technical and Business Personnel

approval process.

We are dependent on the principal members of our senior management team and clinical development team for our business success. The loss of any of these people could impede the achievement of our development and business objectives. We do not carry key man life insurance on the lives of any of our key personnel. There is intense competition for human resources, including management, in the scientific fields in which we operate and there can be no assurance that we will be able to attract and retain qualified personnel necessary for the successful commercialization of our newly-acquired ANDA portfolio, development of our product candidates, and any expansion into areas and activities requiring additional expertise. In addition, there can be no assurance that such personnel or resources will be available when needed. In addition, we rely on a significant number of consultants to assist us in formulating our clinical strategy and other business activities. All of our consultants may have commitments to, or advisory or consulting agreements with, other entities that may limit their availability to us.

We May Need New Collaborative Partners to Further Develop and Commercialize Products, and if We Enter Into Such Arrangements, We May Give Up Control Over the Development and Approval Process and Decrease our Potential Revenue

We plan to develop and commercialize our product candidates both with and without corporate alliances and partners. Nonetheless, we intend to explore opportunities for new corporate alliances and partners to help us develop, commercialize and market our product candidates. We expect tomay grant to our partners certain rights to commercialize any products developed under these agreements, and we may rely on our partners to conduct research and development efforts and clinical trials on, obtain regulatory approvals for, and manufacture and market any products licensed to them. Each individual partner will seek to control the amount and timing of resources devoted to these activities generally. We anticipate obtaining revenues from our strategic partners under such relationships in the form of research and development payments and payments upon achievement of certain milestones. Since we generally expect to obtain a royalty for sales or a percentage of profits of products licensed to third parties, our revenues may be less than if we retained all commercialization rights and marketed products directly. In addition, there is a risk that our corporate partners will pursue alternative technologies or develop competitive products as a means for developing treatments for the diseases targeted by our programs.

product candidates.

We may not be successful in establishing any collaborative arrangements. Even if we do establish such collaborations, we may not successfully commercialize any products under or derive any revenues from these arrangements. There is a risk that we will be unable to manage simultaneous collaborations, if any, successfully. With respect to existing and potential future strategic alliances and collaborative arrangements, we will depend on the expertise and dedication of sufficient resources by these outside parties to develop, manufacture, or market products. If a strategic alliance or collaborative partner fails to develop or commercialize a product to which it has rights, we may not recognize any revenues on that particular product.

We Depend on Patents and Other Proprietary Rights, Some of Which are Uncertain

Our success will depend in part on our ability to obtain and maintain patents for our products in the United States, China and elsewhere. The patent position of biotechnology and pharmaceutical companies in general is highly uncertain and involves complex legal and factual questions. Risks that relate to patenting our products include the following:

Our potential products may conflict with composition, method, and use of patents that have been or may be granted to competitors, universities or others. As the biotechnology industry expands and more patents are issued, the risk increases that our potential products may give rise to claims that may infringe the patents of others. Such other persons could bring legal actions against us claiming damages and seeking to enjoin clinical testing, manufacturing and marketing of the affected products. Any such litigation could result in substantial cost to us and diversion of effort by our management and technical personnel. If any of these actions are successful, in addition to any potential liability for damages, we could be required to obtain a license in order to continue to manufacture or market the affected products. We may not prevail in any actionhave sufficient funds to acquire new product candidates or pay milestone payments.

Our growth strategy relies on our in-license of new product candidates from third parties. Our pipeline will be dependent upon the availability of suitable acquisition candidates at favorable prices and any license required under any needed patent might not be made available on acceptableupon advantageous terms and conditions. Even if at all.

We also rely on trade secret protection for our confidential and proprietary information. However, trade secretssuch opportunities are difficult to protect and others may independently develop substantially equivalent proprietary information and techniques and gain access to our trade secrets and disclose our technology. We may be unable to meaningfully protect our rights to unpatented trade secrets. We require our employees to complete confidentiality training that specifically addresses trade secrets. All employees, consultants, and advisors are required to execute a confidentiality agreement when beginning an employment or a consulting relationship with us. The agreements generally provide that all trade secrets and inventions conceived by the individual and all confidential information developed or made known to the individual during the term of the relationship automatically become our exclusive property. Employees and consultants must keep such information confidential and may not disclose such information to third parties except in specified circumstances. However, these agreements may not provide meaningful protection for our proprietary information in the event of unauthorized use or disclosure of such information.

To the extent that consultants, key employees, or other third parties apply technological information independently developed by them or by others to our proposed projects, disputes may arise as to the proprietary rights to such information. Any such disputespresent, we may not be resolved in our favor. Certainable to successfully identify appropriate acquisition candidates. Moreover, other companies, many of which may have substantially greater financial resources are competing with us for the right to acquire such product candidates.

If a product candidate is identified, the third parties with whom we seek to cooperate may not select us as a potential partner or we may not be able to enter into arrangements on commercially reasonable terms or at all. Furthermore, the negotiation and completion of collaborative and license arrangements could cause significant diversion of management’s time and resources and potential disruption of our consultants are employed by or have consulting agreements with other companiesongoing business.

We must show the safety and any inventions discovered by them generally will not become our property.

Our Potential Products Are Subject to Government Regulatory Requirements and an Extensive Approval Process

Our research, development, preclinical and clinical trials, manufacturing, and marketingefficacy of our product candidates through clinical trials, the results of which are subjectuncertain.

Before obtaining regulatory approvals for the commercial sale of our products, we must demonstrate, through preclinical studies (animal testing) and clinical trials (human testing), that our proposed products are safe and effective for use in each target indication. Testing of our product candidates will be required, and failure can occur at any stage of testing. Clinical trials may not demonstrate sufficient safety and efficacy to an extensive regulatory approval process byobtain the FDA, the CFDA in China and other regulatory agencies. The process of obtaining FDA, CFDA and other required regulatory approvals for drugor result in marketable products. The failure to adequately demonstrate the safety and biologic products, including required preclinical and clinical testing, is time consuming and expensive. Even after spending time and money, we may not receiveefficacy of a product under development could delay or prevent regulatory approvals for clinical testing orapproval of the potential product.

Clinical trials for the manufacturing or marketingproduct candidates we are developing may be delayed by many factors, including that potential patients for testing are limited in number. The failure of any products. Our collaboratorsclinical trials to meet applicable regulatory standards could cause such trials to be delayed or weterminated, which could further delay the commercialization of any of our product candidates. Newly emerging safety risks observed in animal or human studies also can result in delays of ongoing or proposed clinical trials. Any such delays will increase our product development costs. If such delays are significant, they could negatively affect our financial results and the commercial prospects for our products.

Compliance with ongoing post-marketing obligations for our approved products may encounter significant delaysuncover new safety information that could give rise to a product recall, updated warnings, or costsother regulatory actions that could have an adverse impact on our business.

After the FDA approves a drug or biologic for marketing, the product’s sponsor must comply with several post-marketing obligations that continue until the product is discontinued. These post-marketing obligations include the reporting of adverse events to the agency within specified timeframes, the submission of product-specific annual reports that include changes in the effortdistribution, manufacturing, and labeling information, and notification when a drug product is found to secure necessary approvals or licenses. Even if we obtain regulatory clearancehave significant deviations from its approved manufacturing specifications (among others). Our ongoing compliance with these types of mandatory reporting requirements could result in additional requests for information from the FDA and, depending on the scope of a potential product issue that the FDA may decide to pursue, potentially also result in a request from the agency to conduct a product that product will be subjectrecall or to continuing review.  Later discoverystrengthen warnings and/or revise

other label information about the product. FDA may also require or failure to comply withrequest the applicable regulatory requirements may result in restrictions on a product’s marketing or withdrawal of the product from the market, as well as possible civilmarket. Any of these post-marketing regulatory actions could materially affect our sales and, therefore, have the potential to adversely affect our business, financial condition, results of operations and cash flows.

Undesirable adverse events caused by our medicines and drug candidates could interrupt, delay or criminal penalties.halt clinical trials, delay or prevent regulatory approval, limit the commercial profile of an approved label, or result in significant negative consequences following any regulatory approval

Undesirable adverse events ("AEs") caused by our medicines and drug candidates could cause us or regulatory authorities to interrupt, delay or halt clinical trials and could result in a more restrictive label or the delay or denial of regulatory approval, or could result in limitations or withdrawal following approvals. If the conduct or results of our trials or patient experience following approval reveal a high and unacceptable severity or prevalence of AEs, our trials could be suspended or terminated and regulatory authorities could order us to cease further development of, or deny approval of, our drug candidates or require us to cease commercialization following approval.

As is typical in the development of pharmaceutical products, drug-related AEs and serious AEs ("SAEs") have been reported in our clinical trials. Some of these events have led to patient deaths. Drug-related AEs or SAEs could affect patient recruitment or the ability of enrolled subjects to complete the trial and could result in product liability claims. Any of these occurrences may harm our reputation, business, financial condition and prospects significantly. In our periodic and current reports filed with the SEC and our press releases and scientific and medical presentations released from time to time we disclose clinical results for our drug candidates, including the occurrence of AEs and SAEs.

Potential Products May Subject Usproducts may subject us to Product Liabilityproduct liability for Which Insurance May Not Be Available

which insurance may not be available.

The use of our potential products in clinical trials and the marketing of any pharmaceutical products may expose us to product liability claims. We have obtained a level of liability insurance coverage that we believe is adequate in scope and coverage for our current stage of development. However, our present insurance coverage may not be adequate to protect us from liabilities we might incur. In addition, our existing coverage will not be adequate as we further develop products and, in the future, adequate insurance coverage and indemnification by collaborative partners may not be available in sufficient amounts or at a reasonable cost. If a product liability claim or series of claims are brought against us for uninsured liabilities, or in excess of our insurance coverage, the payment of such liabilities could have a negative effect on our business and financial condition.

We are subject to certain U.S. healthcare laws, regulation and enforcement; our failure to comply with those laws could have a material adverse effect on our results of operations and financial condition.

We are subject to certain U.S. healthcare laws and regulations and enforcement by the federal government and the states in which we conduct our business. The laws that may affect our ability to operate include, without limitation:

In addition, certain marketing practices, including off-label promotion, may also violate certain federal and state healthcare fraud and abuse laws, FDA rule and regulations, as well as false claims laws. If our operations are found to be in violation of any of the laws described above or any other governmental regulations that apply to us, we, or our officers or employees, may be subject to penalties, including administrative civil and criminal penalties, damages, fines, withdrawal of regulatory approval, the curtailment or restructuring of our operations, the exclusion from participation in federal and state healthcare programs and imprisonment, any of which could adversely affect our ability to sell our products or operate our business and also adversely affect our financial results.

If we are unable to obtain both adequate coverage and adequate reimbursement from third-party payers for our products before the competitor’s product launch our revenues and prospects for profitability will suffer.

Our ability to successfully commercializeSuccessful commercialization of our products is highly dependent on the extent to which coverage and reimbursement is, and will be, available from third-party payers, including governmental payers such as Medicare and Medicaid, and private health insurers. Patients may not be capable of paying for our products themselves and may rely on third-party payers to pay for, or subsidize, the costs of their medications, among other medical costs. If third-party payers do not provide coverage or reimbursement for our products, our revenues and prospects for profitability will suffer. In addition, even if third-party payers provide some coverage or reimbursement for our products, the availability of such coverage or reimbursement for prescription drugs under private health insurance and managed care plans often varies based on the type of contract or plan purchased.

Current healthcare laws and regulations and future legislative or regulatory reforms to the healthcare system may affectCybersecurity incidents could impair our ability to sellconduct business effectively.

Cybersecurity incidents against us or against a third party that has authorized access to our products profitably.

The United States and some foreign jurisdictions are consideringdata or networks, failure of our disaster recovery systems, or consequential employee error, could have enacted a number of legislative and regulatory proposals to change the healthcare system in ways that could affectan adverse effect on our ability to sellcommunicate or conduct business, negatively impacting our products profitably. Among policy makersoperations and payers infinancial condition. This adverse effect can become particularly acute if those events affect our electronic data processing, transmission, storage, and retrieval systems, or impact the United Statesavailability, integrity, or confidentiality of our data.

We depend heavily upon computer systems to perform necessary business functions. Our computer systems, networks, and elsewhere, there is significant interest in promoting changes in healthcare systems with the stated goalsdata, like those of containing healthcare costs, improving quality and/other companies, could be subject to cyberattacks and unauthorized access, use, alteration, or expanding access. In the United States, the pharmaceutical industry has been a particular focusdestruction. If one or more of these effortsevents occurs, it could potentially jeopardize the confidential, proprietary, and has been significantly affected by major legislative initiatives.

We expect that healthcare reform measures, including the potential repealother information processed, stored in, and replacement of PPACA, that may be adoptedtransmitted through our computer systems and networks. Such an attack could cause interruptions or malfunctions in the future, may have a significant impact on our business. Most recently, the Tax Cuts and Jobs Acts was enacted, which, among other things, removed penalties for not complying with the individual mandate to carry health insurance. Additionally, all or a portion of PPACA and related subsequent legislation may be modified, repealed or otherwise invalidated through judicial challenge,operations, which could result in lower numbersfinancial losses, litigation, regulatory penalties, reputational damage, and increased costs associated with mitigation of insureddamages and remediation. Third parties with which we do business may also be sources of cybersecurity or other technological risk.

The use of quarantines and social distancing restrictions to reduce the spread of COVID-19, including employees who have transitioned to working remotely, may present additional cybersecurity risks to us. Policies of extended periods of remote working, whether by us or third parties with which we do business with, could strain technology resources, introduce operational risks and otherwise heighten the risks described above.

Our business depends substantially on the continuing efforts of our senior management, key employees and qualified personnel, and our business operations may be adversely and negatively impacted if we lose their services.

Our future success depends substantially on the continued efforts of our senior management team and key employees. Our employees play key roles in the areas of product development, marketing, sales, and general and administrative functions. Competition for qualified staff or other key employees in the biopharmaceutical industry in China is intense, particularly for individuals reduced coveragewith multinational experience. If one or more of our members of senior management or key employees are unable or unwilling to continue their services with us, we might not be able to replace them easily, at an acceptable cost or in a timely manner, if at all.

Many of the companies with which we compete for insured individualsexperienced personnel have greater resources than we have and some of these companies may offer more lucrative compensation packages. If any of our key personnel joins a competitor or forms a competing company, we may lose customers, know-how and key professionals and staff members. Even if we enter into employment agreements and non-compete agreements with our employees, certain provisions under these agreements may be deemed invalid or unenforceable under PRC laws. Our continued ability to compete effectively depends on our ability to attract new employees and to retain and motivate our existing employees. Since the demand and competition for talent is intense in our industry, we may need to offer higher compensation and other benefits in order to attract and retain key personnel in the future, which could increase our compensation expenses. If we do not succeed in attracting additional highly skilled personnel or retaining or motivating our existing personnel, we may be unable to grow effectively.

Certain of our directors and officers may have business interests that may conflict with our interests and those of our stockholders.

Certain of our directors and officers have relationships with venture capital or similar funds that invest in life sciences companies that may compete with us. James Huang, a director, is the founding partner of Panacea Venture, a global venture fund focusing on investments in innovative and transformative early and growth stage healthcare and life science companies. Dr. Quan Zhou, another director, previously served as the president of IDG Technology Venture Investment Inc. and has been the managing member of IDG Technology Venture Investments, LP and its successor fund since 2000 and the director of various IDG-Accel China funds since 2005.

Our Chairman and CEO, Dr. Wei-Wu He, is the founder and managing partner of Emerging Technology Partners, LLC (“ETP”), a life science focused venture fund, and its related investing entities. Through funds affiliated with ETP, Dr. He is a founder and significant shareholder of Juventas and currently serves as chairman of Juventas’ board of directors. Mr. Huang, through Panacea Venture, also is an investor in Juventas. In addition, we have an equity investment in Juventas.

Although we require that all transactions with Juventas must be approved by a committee of independent directors, our commercial license, loan to, and other transactions with Juventas could create conflicts of interests for Dr. He or Mr. Huang. Even though we are an investor in Juventas, Dr. He and Mr. Huang may have different business and personal interests than our other stockholders. In particular, Dr. He, as a founder of Juventas, has a direct interest in the financial success of Juventas that may encourage him to support strategies to further the financial success of Juventas that could potentially adversely impact us. To the extent we fail to appropriately deal with any such conflicts of interests, it could negatively impact our reputation and ability to raise additional funds and the willingness of counterparties to do business with us, all of which could have an adverse effect on our business, financial condition, results of operations, and cash flows.

We or the third parties upon whom we rely on may be adversely affected by epidemic outbreaks, earthquakes, tornadoes, hurricanes or other natural disasters, and our business continuity and disaster recovery plans may not adequately protect us from a serious disaster.

We have offices in Rockville, Maryland, and a wholly owned subsidiary in Beijing, China through which substantially all of our operations are conducted. We also rely and intend to rely on third parties, including our clinical research organizations, third party manufacturers, and certain other important vendors and consultants in China and in United States. The occurrence of one or more epidemic outbreaks such as Ebola, Zika, SARS-CoV, COVID-19 or measles, natural disasters, such as tornadoes, hurricanes, fires, floods, hail storms and earthquakes, unusual weather conditions, terrorist attacks or disruptive political events in regions where we operate our business could adversely affect the operations of the third parties we rely on and our business. business, results of operations, financial condition and our prospects.

If PPACA is repealedan epidemic outbreak, natural disaster, power outage or other event occurred that prevented us or the third parties we rely on from using all or a significant portion of our or their offices, damaged critical infrastructure or disrupted operations, it may be difficult, or in certain cases, impossible for us to continue our business for a substantial period of time. The disaster recovery and replaced then it is unclear howbusiness continuity plan we have in place currently are limited and are unlikely to prove adequate in the replacement statuteevent of a serious disaster or similar event. We may impactincur substantial expenses as a result of the limited nature of our business. If PPACA is not repealed or replaced then it will continue to impose requirementsdisaster recovery and business continuity plans, which could have a material adverse effect on our business.

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Moreover, certain politicians, including the President, have announced intentions to propose initiatives to regulate the prices of pharmaceutical products. We cannot know what form any such legislation may take or the market’s perception of how such legislation would affect us. Any reduction in reimbursement from government programs may result in a similar reduction in payments from private payors. The implementation of cost containment measures or other healthcare reforms may prevent us from being able to generate revenue, attain profitability, or commercialize our current products and/or those for which we may receive regulatory approval in the future.

Risks Relating to Our Reliance on Third Parties

The Independent Clinical Investigatorsclinical investigators and Contract Research Organizations That We Rely Uponcontract research organizations that we engage to Assist in the Conduct of Our Clinical Trials May Not Be Diligent, Carefulconduct our clinical trials may not devote sufficient time or Timely, and May Make Mistakes, in the Conduct of Our Trials

attention to our clinical trials or be able to repeat their past success.

We depend on independent clinical investigators and contract research organizations or CROs,(“CROs”) to assist in the conduct of our clinical trials under their agreements with us. The investigators are not our employees, and we cannot control the amount or timing of resources that they devote to our programs. If independent investigators fail to devote sufficient time and resources to our drug development programs, or if their performance is substandard or deviates from regulatory requirements, GCPs, or the protocol, it could delay the approval of our FDA applications and our introduction of new drugs.products. The CROs we contract with to assist with the execution of our clinical trials play a significant role in the conduct of the trials and the subsequent collection and analysis of data. Failure of the CROs to meet their obligations, as well as any failure of us or our collaborators to effectively monitor and audit our CROs and clinical trials, could adversely affect clinical development of our products.

We Have No Current Manufacturing or Marketing Capacityhave no current manufacturing capacity and Relyrely on Only One Supplier For Somelimited suppliers for some of Our Products

our products.

We do not expectplan to manufacture or market productsoperate a manufacturing facility in the near term, but we may try to do soWuxi Huishan Economic Development Zone in certain cases.Jiangsu Province, China. We do not currently have the capacity to manufacture or market products and we have limited experience in these activities. The manufacturing processes for all of the small moleculespipeline we are developing have not yet been tested at commercial levels, and it may not be possible to manufacture these materials in a cost-effective manner. If we elect to perform these functions, we will be required to either develop these capacities, or contract with others to perform some or all of these tasks. We may be dependent to a significant extent on corporate partners, licensees, or other entities for manufacturing and marketing of our products. If we engage directly in manufacturing, or marketing, we will require substantial additional funds and personnel and will be required to comply with extensive regulations. We may be unable to develop or contract for these capacities when required to do so in connection with our business.

We depend on our third-party manufacturers to perform their obligations effectively and on a timely basis. These third parties may not meet their obligations and any such non-performance may delay clinical development or submission of products for regulatory approval, or otherwise impair our competitive position. Any significant problem experienced by one of our suppliers could result in a delay or interruption in the supply of materials to us until such supplier resolves the problem or an alternative source of supply is located. Any delay or interruption would likely lead to a delay or interruption of manufacturing operations, which could negatively affect our operations. Although we have identified alternative suppliers for our product candidates, we have not entered into contractual or other arrangements with them. If we needed to use an alternate supplier for any product, we would experience delays while we negotiated an agreement with them for the manufacture of such product. In addition, we may be unable to negotiate manufacturing terms with a new supplier as favorable as the terms we have with our current suppliers.

Problems with any manufacturing processes, including deviations from cGMP, could result in product defects, which could require us to delay shipment of products or recall products previously shipped.shipped, as well as regulatory action. In addition, any prolonged interruption in the operations of the manufacturing facilities of one of our sole-source suppliers could result in the cancellation of shipments. A number of factors could cause interruptions, including equipment malfunctions or failures, or damage to a facility due to natural disasters or otherwise. BecauseWe expect our future manufacturing processes are or are expected to be, highly complex and subject to a lengthy regulatory approval process, alternativeprocess. Alternative qualified production capacity may not be available on a timely basis or at all. Difficulties or delays in our manufacturing could increase our costs and damage our reputation.

The manufacture of pharmaceutical products can be an expensive, time consuming, and complex process. Manufacturers often encounter difficulties in scaling-up production of new products, including quality control and assurance and shortages of personnel. Delays in formulation and scale-up to commercial quantities could result in additional expense and delays in our clinical trials, regulatory submissions, and commercialization.

Failure of Manufacturing Facilities Producing Our Product Candidatesmanufacturing facilities producing our product candidates to Maintain Regulatory Approval Could Delaymaintain regulatory approval could delay or Otherwise Hinder Our Abilityotherwise hinder our ability to Market Our Product Candidates

market our product candidates. Any manufacturer of our product candidates will be subject to applicable Good Manufacturing Practices (GMP)cGMP prescribed by the FDA or other rules and regulations prescribed by the CFDANMPA and other foreign regulatory authorities. We and any of

our collaborators may be unable to enter into or maintain relationships either domestically or abroad with manufacturers whose facilities and procedures comply or will continue to comply with GMPcGMP and who are able to produce our small moleculesproducts in accordance with applicable regulatory standards. Failure by a manufacturer of our products to comply with GMPcGMP could result in significant time delays or our inability to obtain marketing approval or, should we have market approval, for such approval to continue. Changes in our manufacturers could require new product testing and facility compliance inspections. In the United States,U.S., failure to comply with GMPcGMP or other applicable legal requirements can lead to federal seizure of violated products, injunctive actions brought by the federal government, inability to export product, and potential criminal and civil liability on the part of a company and its officers and employees.

The design and manufacture of a manufacturing facility by CASI Wuxi may be delayed. 

Together with our partner, Wuxi Jintou Huicun Investment Enterprise, a limited partnership organized under Chinese law, we established CASI Wuxi, to build and operate a GMP manufacturing facility in the Wuxi Huishan Economic Development Zone in Jiangsu Province, China. Under the terms of our agreement, we have agreed to invest $80 million in CASI Wuxi. As of December 31, 2021, we have invested $31 million in cash and transferred selected ANDAs valued at $30 million to CASI Wuxi . We are required to invest an additional $19 million in cash for the following two years. We have an 80% interest in CASI Wuxi and our partner has a 20% interest.

In November 2019, CASI Wuxi entered into a lease agreement for the right to use state-owned land in China for the construction of a manufacturing facility. Pursuant to this agreement, CASI Wuxi has committed to invest in land use rights and property, plant and equipment of RMB1 billion (equivalent to US $143 million) by August 2022. The lease agreement also specifies dates by which certain milestones must be met, including a construction start date in August 2020.  Construction of the manufacturing facility began in the fourth quarter of 2020. In February 2022, we have reached an alignment with the Wuxi local government that we will collaborate with Wuxi LP to co-develop the land continuously in the future, and the development plan will be extended, details regarding the plan are under negotiation.

The undertaking of building and establishing a new manufacturing facility can take years. Once completed, the new facility might fail validation or not meet regulatory standards for a commercial manufacturing facility. In addition, the facility may not obtain or retain the requisite legal permits to manufacture in China, and costs or operational limitations may be imposed in connection with obtaining and complying with such permits. Accordingly, there can be no assurance that CASI Wuxi will meet the expenditure requirements and other deadlines set forth in the lease agreement.

The success of CASI Wuxi also relies on our ability to make additional payments in the future, which is uncertain. Our plan may require us to obtain additional debt or equity financing, resulting in additional debt obligations, increased interest expense or dilution of equity ownership.

The timing of the development and investment plans for a manufacturing facility are subject to further discussions with the government. We may seek to renegotiate the terms of our investment in CASI Wuxi, as well as the terms of the various agreements to which CASI Wuxi is a party. There can be no assurance that we will be able to obtain more favorable terms.

If we fail to maintain an effective distribution channel for our medicines, our business and sales could be adversely affected

We rely on third-party distributors to distribute our approved medicines. Our ability to maintain and grow our business will depend on our ability to maintain an effective distribution channel that ensures the timely delivery of our medicines. However, we have relatively limited control over our distributors, who may fail to distribute our drugs in the manner we contemplate. If price controls or other factors substantially reduce the margins our distributors can obtain through the resale of our medicines to hospitals, medical institutions and sub-distributors, they may terminate their relationship with us. While we believe alternative distributors are readily available, there is a risk that, if the distribution of our medicines is interrupted, our sales volumes and business prospects could be adversely affected.

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Risks Related to Extensive Government Regulation

All material aspects of the research, development, manufacturing and commercialization of pharmaceutical products are heavily regulated, and we may face difficulties in complying with or be unable to comply with such regulations, which could have a material adverse effect on our business

All jurisdictions in which we conduct or intend to conduct our pharmaceutical-industry activities regulate these activities in great depth and detail. We are currently focusing our activities in the major markets of the United States, China and Europe. These geopolitical areas all strictly regulate the pharmaceutical industry, and in doing so they employ broadly similar regulatory strategies,

including regulation of product development and approval, manufacturing, and marketing, sales and distribution of products. However, there are differences in the regulatory regimes-some minor, some significant-that make for a more complex and costly regulatory compliance burden for a company like ours that plans to operate in each of these regions.

The process of obtaining regulatory approvals and compliance with appropriate laws and regulations require the expenditure of substantial time and financial resources. Failure to comply with the applicable requirements at any time during the product development process, approval process, or after approval, may subject us to administrative or judicial sanctions. These sanctions could include a regulator’s refusal to approve pending applications, withdrawal of an approval, license revocation, a clinical hold, voluntary or mandatory product recalls, product seizures, total or partial suspension of production or distribution, injunctions, fines, refusals of government contracts, restitution, disgorgement, or civil or criminal penalties. The failure to comply with these regulations could have a material adverse effect on our business.

We are subject to certain U.S. healthcare laws, regulation and enforcement; our failure to comply with those laws could have a material adverse effect on our results of operations and financial condition.

We are subject to certain U.S. healthcare laws and regulations and enforcement by the federal government and the states in which we conduct our business. The laws that may affect our ability to operate include, without limitation:

In addition, certain marketing practices, including off-label promotion, may also violate certain federal and state healthcare fraud and abuse laws, FDA rules and regulations, as well as false claims laws. If our operations are found to be in violation of any of the laws described above or any other governmental regulations that apply to us, we, or our officers or employees, may be subject to penalties, including administrative civil and criminal penalties, damages, fines, withdrawal of regulatory approval, the curtailment or restructuring of our operations, the exclusion from participation in federal and state healthcare programs and imprisonment, any of which could adversely affect our ability to sell our products or operate our business and also adversely affect our financial results.

Current healthcare laws and regulations and future legislative or regulatory reforms to the healthcare system may affect our ability to sell our products profitably.

The U.S. and some foreign jurisdictions are considering or have enacted a number of legislative and regulatory proposals to change the healthcare system in ways that could affect our ability to sell our products profitably. Among policy makers and payers in the U.S. and elsewhere, there is significant interest in promoting changes in healthcare systems with the stated goals of containing healthcare costs, improving quality and/or expanding access. In the U.S., the pharmaceutical industry has been a particular focus of these efforts and has been significantly affected by major legislative initiatives.

We expect that healthcare reform measures, including the potential repeal and replacement of the Patient Protection and Affordable Care Act (“PPACA”), that may be adopted in the future, may have a significant impact on our business. Most recently, the Tax Cuts and Jobs Acts was enacted, which, among other things, removed penalties for not complying with the individual mandate to carry health insurance. Additionally, all or a portion of PPACA and related subsequent legislation may be modified, repealed or otherwise invalidated through judicial challenge, which could result in lower numbers of insured individuals, reduced coverage for insured individuals and adversely affect our business. If PPACA is repealed or replaced, it is unclear how the replacement statute may impact our business. If PPACA is not repealed or replaced, it will continue to impose requirements on our business.

Moreover, certain politicians have announced intentions to propose initiatives to regulate the prices of pharmaceutical products. We cannot know what form any such legislation may take or the market’s perception of how such legislation would affect us. Any reduction in reimbursement from government programs may result in a similar reduction in payments from private payors. The implementation of cost containment measures or other healthcare reforms may prevent us from being able to generate revenue, attain profitability, or commercialize our current products and/or those for which we may receive regulatory approval in the future.

Our medicines and any future approved drug candidates will be subject to ongoing regulatory obligations and continued regulatory review, which may result in significant additional expense and we may be subject to penalties if we fail to comply with regulatory requirements or experience unanticipated problems with our medicines and drug candidates.

Our medicines and any additional drug candidates that are approved will be subject to ongoing regulatory requirements for manufacturing, labeling, packaging, storage, advertising, promotion, sampling, record-keeping, conduct of post-marketing studies, and submission of safety, efficacy, and other post-marketing information, including both federal and state requirements in China, the US and other regions. As such, we and our collaborators will be subject to ongoing review and periodic inspections to assess compliance with applicable post-approval regulations. Additionally, to the extent we want to make certain changes to the approved medicines, product labeling, or manufacturing processes, we will need to submit new applications or supplements to regulatory authorities for approval.

Manufacturers and manufacturers’ facilities are required to comply with extensive FDA, NMPA and comparable regulatory authority requirements, ensuring that quality control and manufacturing procedures conform to GMP regulations. As such, we and our contract manufacturers are and will be subject to continual review and inspections to assess compliance with GMP and adherence to commitments made in any NDA or BLA, other marketing application, and previous responses to any inspection observations. Accordingly, we and others with whom we work must continue to expend time, money and effort in all areas of regulatory compliance, including manufacturing, production and quality control. The failure to comply with these requirements could have a material adverse effect on our business.

The regulatory approvals for our medicine and any approvals that we receive for our drug candidates are and may be subject to limitations on the approved indicated uses for which the medicine may be marketed or to the conditions of approval, which could adversely affect the drug’s commercial potential or contain requirements for potentially costly post-marketing testing and surveillance

to monitor the safety and efficacy of the drug or drug candidate. The FDA, NMPA, EMA or comparable regulatory authorities may also require a REMS program or comparable program as a condition of approval of our drug candidates or following approval. In addition, if the FDA, NMPA, EMA or a comparable regulatory authority approves our drug candidates, we will have to comply with requirements including, for example, submissions of safety and other post-marketing information and reports, establishment registration, as well as continued compliance with GMP and good clinical practice (“GCP”) for any clinical trials that we conduct post-approval.

The FDA, NMPA, EMA or comparable regulatory authorities may seek to impose a consent decree or withdraw marketing approval if compliance with regulatory requirements is not maintained or if problems occur after the drug reaches the market. Later discovery of previously unknown problems with our medicines or drug candidates or with our drug’s manufacturing processes, or failure to comply with regulatory requirements, may result in revisions to the approved labeling to add new safety information; imposition of post-market studies or clinical studies to assess new safety risks; or imposition of distribution restrictions or other restrictions under a REMS program. Other potential consequences include, among other things:

The FDA, NMPA, EMA and other regulatory authorities strictly regulate the marketing, labeling, advertising and promotion of products that are placed on the market. Drugs may be promoted only for their approved indications and for use in accordance with the provisions of the approved label. The FDA, NMPA, EMA and other regulatory authorities actively enforce the laws and regulations prohibiting the promotion of off-label uses, and a company that is found to have improperly promoted off-label uses may be subject to significant liability. The policies of the FDA, NMPA, EMA and of other regulatory authorities may change and additional government regulations may be enacted that could prevent, limit or delay regulatory approval of our drug candidates. We cannot predict the likelihood, nature or extent of government regulation that may arise from future legislation or administrative action, either in the United States or abroad, particularly in China, where the regulatory environment is constantly evolving. If we are slow or unable to adapt to changes in existing requirements or the adoption of new requirements or policies, or if we are not able to maintain regulatory compliance, we may lose any regulatory approval that we may have obtained and we may not achieve or sustain profitability.

In addition, if we obtain accelerated approval or conditional approval of any of our drug candidates, as we have done with the initial approval of EVOMELA^® in China we will be required to conduct a confirmatory study (also called Post Marketing Study “PMS”) to verify the predicted clinical benefit and may also be required to conduct post-marketing safety studies. Other comparable regulatory authorities may have similar requirements. The results from the confirmatory study may not support the clinical benefit, which could result in the approval being withdrawn. While operating under accelerated approval, we will be subject to certain restrictions that we would not be subject to upon receiving regular approval.

Risks Relating to Our Intellectual Property

We depend on patents and other proprietary rights, some of which are uncertain.  If we are unable to protect our intellectual property rights our business and competitive position would be harmed.

We have in-licensed rights to a variety of product candidates. Our success, competitive position and future revenues with respect to these product candidates will depend, in part, on our ability to protect our intellectual property. We will be able to protect our proprietary rights from unauthorized use by third parties only to the extent that our proprietary rights are covered by valid and enforceable patents or are effectively maintained as trade secrets. We attempt to protect our proprietary position by maintaining trade secrets and by filing U.S. and foreign patent applications related to our in-licensed technology, inventions and improvements that are important to the development of our business. Our failure to do so may adversely affect our business and competitive position.

The patent positions of biotechnology and pharmaceutical companies can be highly uncertain and involve complex legal and factual questions for which important legal principles remain unresolved. We may not be able to protect our intellectual property rights throughout the world. No consistent policy regarding the breadth of claims allowed in pharmaceutical patents has emerged to date in the U.S. or in many jurisdictions outside of the U.S. Changes in either the patent laws or interpretations of patent laws in the U.S. and other countries may diminish the value of our intellectual property and therefore we cannot predict with certainty whether any patent

applications that we have filed or that we may file in the future will be approved, will cover our products or product candidates or that any resulting patents will be enforced. In addition, third parties may challenge, seek to invalidate, limit the scope of or circumvent any of our patents, once they are issued. Thus, any patents that we own or license from third parties or CASI Wuxi or development partners may not provide any protection against competitors. Any patent applications that we have filed or that we may file in the future, or those we may license from third parties or CASI Wuxi or development partners, may not result in patents being issued. Moreover, disputes between our licensing or joint development partners and us may arise over license scope, or ownership, assignment, inventorship and/or rights to use or commercialize patent or other proprietary rights, which may adversely impact our ability to obtain and protect our proprietary technology and products. Also, patent rights may not provide us with adequate proprietary protection or competitive advantages against competitors with similar technologies or products.

Third parties may initiate legal proceedings alleging infringement of intellectual property rights, the outcome of which would be uncertain and could harm our business

Third parties may assert patent or other intellectual property infringement claims against us or our licensors arising from the manufacture, use and sale of our current or future product candidates in China or in any other jurisdictions we ultimately commercialize in. The validity of our current or future patents or patent applications or those of our licensors may be challenged in litigation, interference or derivation proceedings, opposition, post grant review, inter parts review, or other similar enforcement and revocation proceedings, provoked by third parties or brought by us, may be necessary to determine the validity of our patents or patent applications or those of our licensors. Our patents could be found invalid, unenforceable, or their scope significantly reduced.

An unfavorable outcome could require us to cease using the related technology or to attempt to license rights to it from the prevailing party. Our business could be harmed if the prevailing party does not offer us a license on commercially reasonable terms. Our defense of litigation or interference proceedings may fail and, even if successful, may result in substantial costs and distract our management and other employees. In the event of a successful claim of infringement against us, we may have to pay substantial damages, including treble damages and attorneys’ fees for willful infringement, pay royalties, redesign our infringing products or obtain one or more licenses from third parties, which may be impossible or require substantial time and monetary expenditure.

Although China recently adopted changes to its patent law to include patent term extension and an early resolution mechanism for pharmaceutical patent disputes starting in June 2021, key provisions of the law remain unclear and/or subject to implementing regulations. The absence of effective regulatory exclusivity for pharmaceutical products in China could further increase the risk of early generic or biosimilar competition with our medicines in China.

In China, laws on patent term extension, patent linkage, and data exclusivity (referred to as regulatory data protection) are still developing. Therefore, a lower-cost generic drug can emerge onto the market much more quickly. Chinese regulators have set forth a framework for integrating patent linkage and data exclusivity into the Chinese regulatory regime, as well as for establishing a pilot program for patent term extension. The Economic and Trade Agreement Between the United States of America and the People's Republic of China announced in January 2020 (the "Trade Agreement") also provides for a mechanism for early resolution of patent disputes and patent term extension systems. To be implemented, this framework will require adoption of legislation and regulations. In October 2020, China adopted amendments to its Patent Law (the “Amended PRC Patent Law”), which will become effective on June 1, 2021. The Amended PRC Patent Law contains both patent term extension and a mechanism for early resolution of patent disputes, which may be comparable to patent linkage in the United States. However, the provisions for patent term extension and an early resolution mechanism are unclear and/or remain subject to the approval of implementing regulations that are still in draft form or have not yet been proposed, leading to uncertainty about their scope and implementation.

Until the relevant implementing regulations for patent term extension and an early resolution mechanism in the Amended PRC Patent Law are implemented, and until data exclusivity is adopted and implemented, we may be subject to earlier generic competition.

Risks Relating to Our Common Stock

The market price of our common stock may be highly volatile or may decline regardless of our operating performance.

The Market Pricevolatile price of Our Common Stock May Be Highly Volatileour stock makes it difficult for investors to predict the value of their investments, to sell shares at a profit at any given time, or May Decline Regardless of Our Operating Performance

to plan purchases and sales in advance. Our common stock price has fluctuated from year-to-year and quarter-to-quarter and will likely continue to be volatile. During 2017,2021, our stock price has ranged from $0.91$0.77 to $4.00.$3.63. We expect that the trading price of our common stock is likely to be highly volatile in response to a variety of factors that are beyond our control.control, such as:

We will not be able to control many of these factors, and we believe that period-to-period comparisons of our financial results will not necessarily be indicative of our future performance. The valuations of many biotechnology companies without consistent product revenues and earnings are extraordinarily high based on conventional valuation standards, such as price to earnings and price to sales ratios. These trading prices and valuations may not be sustained. In the future, our operating results in a particular period may not meet the expectations of any securities analysts whose attention we may attract, or those of our investors, which may result in a decline in the market price of our common stock. Any negative change in the public’s perception of the prospects of biotechnology companies could depress our stock price regardless of our results of operations. These factors may materially and adversely affect the market price of our common stock.

Our Largest Holders Of Common Stock May Have Different Interests Than Our Other Stockholders

largest stockholders, including our directors and executive officers and investment funds with which they are associated, hold a significant amount of our outstanding common stock and, if they acted together, could influence our management and affairs.

A small number of our stockholders, including our directors and executive officers and investment funds with which they are associated, hold a significant amount of our outstanding common stock. In addition, our executive officers and directors and investment funds with which they are associated could determine to make additional purchases of common stock, to the extent permitted by law. In the future, our executive officers and directors also could be issued shares of common stock as determined by the Compensation Committee and the Board in connection with current or future equity incentive plans.

These stockholders, may have interests that are different fromif they acted together, could significantly influence the interestsvote on all matters requiring approval by our stockholders, including the election of ourdirectors and the approval of mergers or other stockholders.business combination transactions. We cannot assure you that our largest stockholders will not seek to influence our business and affairs in a manner that is contrary to our goals or strategies or the interests of our other stockholders. In addition, the significant concentration of ownership in our common stock may adversely affect the trading price for our common stock because investors often perceive disadvantages in owning stock in companies with significant stockholders.

Our largest stockholders, if they acted together, could significantly influence all matters requiring approval byamended and restated bylaws provide that the Court of Chancery of the State of Delaware will be the exclusive forum for certain legal actions between us and our stockholders, includingwhich could increase costs to bring a claim, discourage claims or limit the electionability of our stockholders to bring a claim in a judicial forum viewed by the stockholders as more favorable for disputes with us or our directors, officers or other employees.

Our amended and restated bylaws, effective September 10, 2020, provide that unless CASI consents in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware will be the sole and exclusive forum for any (i) any derivative action or proceeding brought on behalf of CASI, (ii) any action asserting a claim of breach of a fiduciary duty owed by any director, officer or other employee of CASI to CASI or CASI’s stockholders, (iii) any action asserting a claim arising under any provision of the General Corporation Law of the State of Delaware, CASI’s certificate of incorporation or CASI’s Amended and Restated By-Laws or (iv) any action asserting a claim governed by the internal affairs doctrine. The choice of forum provision may increase costs to bring a claim, discourage claims or limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or our directors, officers or other employees, which may discourage such lawsuits against us or our directors, officers and other employees. Alternatively, if a court were to find the choice of forum provision contained in our amended and restated bylaws to be inapplicable or unenforceable in an action, CASI may incur additional costs associated with resolving such action in other jurisdictions. In addition, unless CASI consents in writing to the selection of an alternative forum, the federal district courts of the United States of America will be the exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act of 1933.

Risks Relating to Our Auditor

The audit report included in this Annual Report on Form 10-K are prepared by auditors who are not currently inspected by the PCAOB and, as such, our stockholders are deprived of the benefits of such inspection.  In addition, various legislative and regulatory developments related to U.S.-listed China based companies due to lack of PCAOB inspection and other developments due to political tensions between the United States and China may have a material adverse impact on our listing and trading in the United States and the trading prices of our shares of common stock.

Our auditor, the independent registered public accounting firm that issued the audit report included in this Annual Report on Form 10-K, as an auditor of companies that are traded publicly in the United States and a firm registered with the Public Company Accounting Oversight Board (“PCAOB”), is subject to laws in the United States pursuant to which the PCAOB conducts regular inspections to assess its compliance with applicable professional standards. Our auditor is located in, and organized under the laws of, the PRC, which is a jurisdiction where the PCAOB has been unable to conduct inspections without the approval of mergersthe Chinese authorities.

On April 21, 2020, the SEC and the PCAOB released a joint statement highlighting the risks associated with investing in companies based in or having substantial operations in emerging markets including China. The joint statement emphasized the risks associated with lack of access for the PCAOB to inspect auditors and audit work papers in China and higher risks of fraud in emerging markets.

On May 18, 2020, Nasdaq filed three proposals with the SEC to (i) apply a minimum offering size requirement for companies primarily operating in a “Restrictive Market,” (ii) adopt a new requirement relating to the qualification of management or the board of directors for Restrictive Market companies, and (iii) apply additional and more stringent criteria to an applicant or listed company based on the qualifications of the company’s auditor.

On December 18, 2020, the President signed the “Holding Foreign Companies Accountable Act” (the “HFCAA”) into law. This legislation requires certain issuers of securities to establish that they are not owned or controlled by a foreign government. Specifically, an issuer must make this certification if the PCAOB is unable to audit specified reports because the issuer has retained a foreign public accounting firm not subject to inspection by the PCAOB. Furthermore, if the PCAOB is unable to inspect the issuer's public accounting firm for three consecutive years, the issuer's securities are banned from trading on a national exchange or through other business combination transactions.methods.

On March 24, 2021, the SEC adopted interim final rules relating to the implementation of certain disclosure and documentation requirements of the HFCA Act. We will be required to comply with these rules if the SEC identifies us as having a “non-inspection” year under a process to be subsequently established by the SEC. On December 2, 2021, the SEC adopted final amendments to its rules implementing the HFCA Act (the “Final Amendments”). The Final Amendments finalize the interim final rules adopted in March with two major modifications. First, the Final Amendments clarify how the requirements apply to variable interest entities. Second, the Final Amendments include requirements to disclose information, including the auditor name and location, the percentage of shares of the issuer owned by governmental entities, whether governmental entities in the applicable foreign jurisdiction with respect to the auditor has a controlling financial interest with respect to the issuer, the name of each official of the Chinese Communist Party who is a member

of the board of the issuer, and whether the articles of incorporation of the issuer contains any charter of the Chinese Communist Party. The Final Amendments also establish procedures the SEC will follow in identifying issuers and prohibiting trading by certain issuers under the HFCA Act.

On June 22, 2021, the U.S. Senate passed the Accelerating Holding Foreign Companies Accountable Act (the “AHFCA Act”), which if enacted into law would amend the HFCA Act and require the SEC to prohibit an issuer’s securities from trading on any U.S. stock exchanges if its auditor is not subject to PCAOB inspections for two consecutive years instead of three.

On November 5, 2021, the SEC approved the PCAOB’s Rule 6100, Board Determinations Under the Holding Foreign Companies Accountable Act. Rule 6100 will establish a framework for the PCAOB’s determinations under the HFCA Act that the PCAOB is unable to inspect or investigate completely registered public accounting firms located in a foreign jurisdiction because of a position taken by an authority in that jurisdiction. On December 16, 2021, the PCAOB issued a report to notify the SEC its determinations that it is unable to inspect or investigate completely registered public accounting firms headquartered in Mainland China and identifies the registered public accounting firms in Mainland China that are subject to such determinations. Our largest stockholders togetherauditor is identified by the PCAOB and is subject to the determination.

The lack of access to the PCAOB inspection in China prevents the PCAOB from fully evaluating audits and quality control procedures of the auditors based in China. As a result, investors may be deprived of the benefits of such PCAOB inspections. The inability of the PCAOB to conduct inspections of auditors in China makes it more difficult to evaluate the effectiveness of these accounting firm’s audit procedures or quality control procedures as compared to auditors outside of China that are subject to the PCAOB inspections, which could cause investors and potential investors in our common stock to lose confidence in our audit procedures and reported financial information and the quality of our financial statements.

We could be delisted if our auditors are unable to meet the PCAOB inspection requirements in time.

The HFCAA requires the SEC to prohibit securities of any foreign companies from being listed on U.S. securities exchanges or traded “over-the-counter” if a company retains a foreign accounting firm that cannot be inspected by the PCAOB for three consecutive years, beginning in 2021. The AHFCAA would shorten this period to two consecutive years, also beginning in 2021. Our independent registered public accounting firm is located in and organized under the laws of the PRC, a jurisdiction where the PCAOB is currently unable to conduct inspections without the approval of the Chinese authorities, and therefore our auditors are not currently inspected by the PCAOB. As such, the requirements under the HFCAA will apply to us beginning in 2022, and we will be subject to the related reporting requirements in 2023 and (as discussed below) the trading restrictions would apply to us in 2024.

The enactment of the HFCAA, the AHFCAA and any additional rulemaking efforts to increase U.S. regulatory access to audit information in China could cause investor uncertainty for affected SEC registrants, including us, and the market price of our shares of common stock could be materially adversely affected. Additionally, whether the PCAOB will be able to determineconduct inspections of our auditors in the next three years, or at all, matters requiring stockholder approval.is subject to substantial uncertainty and depends on a number of factors out of our control. If we are unable to meet the PCAOB inspection requirement in time, we could be delisted from the Nasdaq Capital Market and our shares of common stock will not be permitted for trading "over-the-counter" market. Such a delisting would substantially impair your ability to sell or purchase our shares of common stock when you wish to do so, and the risk and uncertainty associated with delisting would have a negative impact on the price of our shares. Also, such a delisting would significantly affect our ability to raise capital on terms acceptable to us, or at all, which would have a material adverse impact on our business, financial condition and prospects.

Risks Relating to Our Business Operations in China

We conduct a majority of our operations in China, which exposes us to risks associated with operating outside of the U.S. Changes in international trade and economic policy by the U.S. and Chinese governments could have a material adverse effect on our business and operations.

We have operations and conduct business in China, and we plan to continue to expand these operations. Therefore, we are subject to risks related to operating in foreign countries, which include complex foreign laws or regulatory requirements or unexpected changes to those laws or requirements; other laws and regulatory requirements to which our business activities abroad are subject, such as the Foreign Corrupt Practices Act; changes in the political or economic condition of a specific country or region; fluctuations in the value of foreign currency versus the U.S. dollar; our ability to deploy overseas funds in an efficient manner; tariffs, trade protection measures, import or export licensing requirements, trade embargoes, and sanctions (including those administered by the Office of Foreign Assets Control of the U.S. Department of the Treasury), and other trade barriers; difficulties in attracting and retaining qualified personnel; and cultural differences in the conduct of business. There is currently significant uncertainty about the future relationship between the U.S. and various other countries, including China, with respect to trade policies, treaties, government regulations and tariffs.

Any of the foregoing could harm our business and we cannot anticipate all of the ways in which the current political climate could adversely impact our business.

Governmental control of currency conversion and payments of RMB out of mainland China may limit our ability to utilize our cash balances effectively and affect the value of your investment.

Our China subsidiaries have cash and cash equivalents of 122.9 million China Renminbi (“RMB”), valued at $19.3 million in U.S. dollars as of December 31, 2021.On a consolidated basis this balance accounts for 50% of our total cash and cash equivalents. The Chinese government imposes controls on the convertibility of RMB into foreign currencies and, in certain cases, the remittance of RMB out of mainland China. Control on payments out of mainland China may restrict the ability of our China subsidiaries to remit RMB to us. Approval from China’s State Administration of Foreign Exchange (“SAFE”) and the People’s Bank of China (“PBOC”) may be required where RMB are to be converted into foreign currencies, including U.S. dollars, and approval from SAFE and the PBOC or their branches may be required where RMB are to be remitted out of mainland China. Specifically, under the existing restrictions, without prior approval from SAFE and the PBOC, the cash balance of our China subsidiaries is not available to us for activities outside of China, including the support of our in-licensing efforts. Furthermore, because repatriation of funds requires the prior approval of SAFE and the PBOC, such repatriation could be delayed, restricted or limited.

Changes in China’s economic, political or social conditions or government policies could have a material adverse effect on our business and operations.

Chinese society and the Chinese economy continue to undergo significant change. Adverse changes in the political and economic policies of the Chinese government could have a material adverse effect on the overall economic growth of China, which could adversely affect our ability to conduct business in China. The Chinese government continues to adjust economic policies to promote economic growth. Some of these measures benefit the overall Chinese economy but may also have a negative effect on us. For example, our financial condition and results of operations in China may be adversely affected by government control over capital investments or changes in tax regulations. As the Chinese pharmaceutical industry grows and evolves, the Chinese government may also implement measures to change the structure of foreign investment in this industry. We are unable to predict the frequency and scope of such policy changes, any of which could materially and adversely affect our liquidity, access to capital and its ability to conduct business in China. Any failure on our part to comply with changing government regulations and policies could result in the loss of our ability to develop and commercialize our product candidates in China.

The Chinese government exerts substantial influence over the manner in which we must conduct our business activities.

The China government has exercised and continues to exercise substantial control over virtually every sector of the Chinese economy through regulation and state ownership. Our ability to operate in China may be harmed by changes in its laws and regulations, including those relating to taxation, import and export tariffs, environmental regulations, land use rights, property, healthcare regulations, and other matters. We believe that our operations in China are in material compliance with all applicable legal and regulatory requirements. However, the central or local governments of the jurisdictions in which we operate may impose new, stricter regulations or interpretations of existing regulations that would require additional expenditures and efforts on our part to ensure our compliance with such regulations or interpretations.

Accordingly, government actions in the future, including any decision not to continue to support recent economic reforms and to return to a more centrally planned economy or regional or local variations in the implementation of economic policies, could have a significant effect on economic conditions in China or particular regions thereof and could require us to divest ourselves of any interest we then hold in Chinese properties, subsidiaries, or joint ventures.

We are subject to the Enterprise Income Tax Law, and we may therefore be subject to PRC income tax on our global income.

Under the PRC Enterprise Income Tax Law and its implementing rules, both of which came into effect on January 1, 2008, enterprises established under the laws of jurisdictions outside of China with “de facto management bodies” located in China may be considered PRC tax resident enterprises for tax purposes and may be subject to the PRC enterprise income tax at the rate of 25% on their global income. “De facto management body” refers to a managing body that exercises substantive and overall management and control over the production and business, personnel, accounting books and assets of an enterprise. The State Administration of Taxation issued the Notice Regarding the Determination of Chinese-Controlled Offshore-Incorporated Enterprises as PRC Tax Resident Enterprises on the basis of de facto management bodies, or Circular 82, on April 22, 2009. Circular 82 provides certain specific criteria for determining whether the “de facto management body” of a Chinese-controlled offshore-incorporated enterprise is located in China.

Although Circular 82 only applies to offshore enterprises controlled by PRC enterprises, not those controlled by foreign enterprises or individuals, the determining criteria set forth in Circular 82 may reflect the State Administration of Taxation’s general position on how the “de facto management body” test should be applied in determining the tax resident status of offshore enterprises, regardless of whether they are controlled by PRC enterprises. If we were to be considered a PRC resident enterprise, we would be subject to PRC enterprise income tax at the rate of 25% on our global income. In such case, our profitability and cash flow may be materially reduced as a result of our global income being taxed under the Enterprise Income Tax Law. Although we believe that none of our entities outside of China should be considered a PRC resident enterprise for PRC tax purposes. the tax resident status of an enterprise is subject to determination by the PRC tax authorities and uncertainties remain with respect to the interpretation of the term “de facto management body.”

China regulations relating to investments in offshore companies by China residents may subject our China-resident stockholders, beneficial owners or our China subsidiaries to liability or penalties, limit our ability to inject capital into our China subsidiaries or limit our China subsidiaries’ ability to increase their registered capital or distribute profits to us.

The State Administration of Foreign Exchange, or SAFE, promulgated the Circular on Relevant Issues Concerning Foreign Exchange Control on Domestic Residents’ Offshore Investment and Financing and Roundtrip Investment through Special Purpose Vehicles, or SAFE Circular 37, on July 4, 2014, which replaced the former circular commonly known as “SAFE Circular 75” promulgated by SAFE on October 21, 2005. SAFE Circular 37 requires China residents to register with local branches of SAFE in connection with their direct establishment or indirect control of an offshore entity, for the purpose of overseas investment and financing, with such China residents’ legally owned assets or equity interests in domestic enterprises or offshore assets or interests, referred to in SAFE Circular 37 as a “special purpose vehicle.” SAFE Circular 37 further requires amendment to the registration in the event of any significant changes with respect to the special purpose vehicle, such as increase or decrease of capital contributed by China individuals, share transfer or exchange, merger, division or other material event. In the event that a China shareholder holding interests in a special purpose vehicle fails to fulfill the required SAFE registration, the China subsidiaries of that special purpose vehicle may be prohibited from making profit distributions to the offshore parent and from carrying out subsequent cross-border foreign exchange activities, and the special purpose vehicle may be restricted in its ability to contribute additional capital into its China subsidiary. Moreover, failure to comply with the various SAFE registration requirements described above could result in liability under China law for evasion of foreign exchange controls. According to the Notice on Further Simplifying and Improving Policies for the Foreign Exchange Administration of Direct Investment released on February 13, 2015 by SAFE, local banks will examine and handle foreign exchange registration for overseas direct investment, including the initial foreign exchange registration and amendment registration, under SAFE Circular 37 from June 1, 2015.

According to SAFE Circular 37, our stockholders or beneficial owners, who are China residents, are subject to SAFE Circular 37 or other foreign exchange administrative regulations in respect of their investment in our company. We may not be aware of the identities of all of our stockholders or beneficial owners who are China residents, and we do not know whether they are aware of SAFE Circular 37. We do not have control over our stockholders or beneficial owners and there can be no assurance that all of our China-resident stockholders or beneficial owners will comply with SAFE Circular 37 and subsequent implementation rules, and there is no assurance that the registration under SAFE Circular 37 and any amendment will be completed in a timely manner, or will be completed at all. The failure of our stockholders or beneficial owners who are China residents to register or amend their foreign exchange registrations in a timely manner pursuant to SAFE Circular 37 and subsequent implementation rules, or the failure of future stockholders or beneficial owners who are China residents to comply with the registration procedures set forth in SAFE Circular 37 and subsequent implementation rules, may subject such stockholders or beneficial owners or our China subsidiaries to fines and legal sanctions. Failure to register or comply with relevant requirements may also limit our ability to contribute additional capital to our China subsidiaries and limit our China subsidiaries’ ability to distribute dividends to us. Because a majority of our operating activities take place in and our strategic focus is on China, any such limitations would have a material adverse effect on our business, financial condition and results of operations.

We may be subject to fines and legal sanctions by SAFE or other China government authorities if we or our employees who are China citizens fail to comply with regulations relating to employee stock options granted by companies listed on exchanges outside of China to China citizens.

On February 15, 2012, SAFE promulgated the Circular on Relevant Issues Concerning the Foreign Exchange Administration for Domestic Individuals’ Participating in the Share Incentive Plans of Overseas-Listed Companies, or SAFE Circular 7, replacing earlier rules promulgated in 2007. Under SAFE Circular 7, China resident individuals who participate in a share incentive plan of a company that is listed on an overseas exchange are required to register with SAFE and complete certain other procedures. All participants to a plan need to retain a China agent through Chinese subsidiaries of the overseas listed company to handle foreign exchange

registration, account opening, funds transfer and remittance and other related matters. An overseas agent should also be designated to handle matters in connection with the exercise or sale of share awards and proceeds transferring for the share incentive plan participants. We believe that our share incentive plans for our China resident employees are in compliance with SAFE Circular 7; however, any failure to comply with these or similar regulations in the future may subject us or our Chinese employees to fines and legal sanctions imposed by SAFE or other government authorities and may prevent us from further granting options under our share incentive plans to our employees. Such events could adversely affect our business operations.

General Risk Factors

We may engage in strategic, commercial and other corporate transactions that could negatively affect our financial condition and prospects.

We may consider strategic, commercial, and other corporate transactions as opportunities present themselves. There are risks associated with such activities. These risks include, among others, incorrectly assessing the quality of a prospective strategic partner, encountering greater than anticipated costs in integration, being unable to profitably deploy assets acquired in the transaction, such as drug candidates, possible dilution to our stockholders, and the loss of key employees due to changes in management. Further, strategic transactions may place additional constraints on our resources by diverting the attention of our management from our business operations. To the extent we issue securities in connection with additional transactions, these transactions and related issuances may have a dilutive effect on existing shareholders. Our financial condition and prospects after an acquisition depend in part on our ability to successfully integrate the operations of the acquired business or technologies. We may be unable to integrate operations successfully or to achieve expected cost savings. Any cost savings which are realized may be offset by losses in revenues or other charges to earnings.

If securities or industry analysts publish inaccurate or unfavorable research about our business, our stock price could decline.

The trading market for our common stock will depend in part on the research and reports that securities or industry analysts publish about us or our business. If one or more of the analysts who may cover us downgrade our common stock or publish inaccurate or unfavorable research about our business, our common stock price would likely decline.

Subsequent Resales Of Shares Of Our Common Stock In The Public Market May Cause The Market Price Of Our Common Stock To Fall

resales of shares of our common stock in the public market may cause the market price of our common stock to fall.

The market value of our common stock could decline as a result of sales by investors from time to time, or perceptions that such sales may occur, of a substantial amount of the shares of common stock held by them.

Issuances of Additional Sharesadditional shares of Our Common Stock May Cause Substantial Dilutionour common stock may cause substantial dilution of Existing Stockholders

existing stockholders.

We may issue additional shares of common stock or other securities that are convertible into or exercisable for common stock in connection with future acquisitions, future sales of our securities for capital raising purposes, future strategic relationships, or for other business purposes. The future issuance of any additional shares of our common stock may create downward pressure on the trading price of our common stock. There can be no assurance that we will not be required to issue additional shares, warrants or other convertible securities in the future in conjunction with any capital raising efforts, including at a price (or exercise prices) below the price at which shares of our common stock are then traded.

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We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

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As of December 31, 2017,2021, we leased approximately 4,200 square feet ofhold leases for land, office space in Rockville, Maryland where our headquarters are located. In addition, as of December 31, 2017, we leased approximately 4,100 square feet of office space in Beijing, China where our China operations are based and approximately 11,000 square feet of laboratory space, as follows:

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China:

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United States:

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We believe that our facilities are adequate for current needs; however, the Company is in the process of expanding operations in China and, accordingly, intends to increase facilities to meet our foreseeable and long-term needs. We do not own any real property.

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CASI is subject in the normal course of business to various legal proceedings in which claims for monetary or other damages may be asserted. Management does not believe such legal proceedings, unless otherwise disclosed herein, are material.

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Not applicable.

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PART II

ITEM 5.MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.

Market for Common Equity

The following table sets forth the high and low closing price for ourOur common stock by quarter, as reported by the NASDAQtrades on The Nasdaq Capital Market forunder the periods indicated:

On March 26, 2018, the closing price of our common stock, as reported by The NASDAQ Capital Market, was $4.00 per share.symbol “CASI.” As of March 26, 201818, 2022, there were approximately 315254 holders of record of our common stock.

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Dividend Policy

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Since our initial public offering in 1996, we have notThe Company has never declared or paid cash dividends on ourits common stock. We currently anticipate thatstock or any earnings will be retained for the continued development of our businessother securities and we dodoes not anticipate paying any cash dividends on our common stock in the foreseeable future.

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We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

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The following discussion should be read in conjunction with the Consolidated Financial Statements and Notes thereto appearing elsewhere in this report. See also “Risk Factors” in Item 1A of this Annual Report.

OVERVIEW

We are a U.S. based biopharmaceutical company dedicated to bringing high quality, cost-effectivefocused on developing and commercializing innovative therapeutics and pharmaceutical products in China, the United States, and innovativethroughout the world. We were incorporated in 1991, and in 2012, with new leadership, the Company shifted its business strategy to China and has since built an infrastructure in China that includes sales and marketing, medical affairs, regulatory and clinical development and in the foreseeable future, manufacturing. In 2014, the Company changed its name to “CASI Pharmaceuticals, Inc.” We are focused on acquiring, developing and commercializing products that augment our hematology oncology therapeutics to patients. We intend to executetherapeutic focus as well as other areas of unmet medical need. The Company is executing our plan to become a leading pharmaceutical company with a substantial market share in China. We are headquartered in Rockville, Maryland with established China operations that are expanding as we continue to further in-license or acquire products for our pipeline.

Our product pipeline features (1) EVOMELA^®, MARQIBO^®, and ZEVALIN^®, all U.S. FDA approved drugs in-licensed from Spectrum Pharmaceuticals, Inc. for China regional rights, and currently in various stagesbiopharmaceutical leader by launching medicines in the greater China market, leveraging our China-based regulatory, process for market approval in China, (2) an acquired portfolioclinical and commercial competencies and our global drug development expertise.  The majority of 25 FDA-approved abbreviated new drug applications (“ANDAs”), one ANDA that FDA tentatively approved, and three ANDAs thatthe Company’s operations are pending FDA approval, from which we will prioritize a select subset of product registration and commercialization in China, (3) our proprietary drug candidate, ENMD-2076, currently in Phase 2 clinical development, and (4) CASI-001 and CASI-002, proprietary early-stage candidates in immuno-oncology in preclinical development. We believe our pipeline reflects a risk-balanced approach between products in various stages of development, and between products that we develop ourselves and those that we develop with our partners for the China regional market. We intend to continue building a significant product pipeline of high quality, cost-effective pharmaceuticals, as well as innovative drug candidates that we will commercialize alonenow located in China and are conducted primarily through two of our subsidiaries: (i) CASI Pharmaceuticals (China) Co., Ltd.. (“CASI China”), which is wholly owned and is located in Beijing, China, and (ii) CASI Pharmaceuticals (Wuxi) Co., Ltd.. (“CASI Wuxi”), which is located in Wuxi, China. Our Beijing office is primarily responsible for our day-to-day operations and our commercial team of over 100 hematology/oncology sales and marketing specialists based in China.  CASI Wuxi is part of the long-term strategy to support our future clinical and commercial manufacturing needs, to manage our supply chain for certain products, and to develop a GMP manufacturing facility in China.

We launched our first commercial product, EVOMELA^® (Melphalan for Injection) in China in August 2019. In China, EVOMELA^® is approved for use as a conditioning treatment prior to stem cell transplantation and as a palliative treatment for patients with partnersmultiple myeloma. The other core hematology/oncology assets in the Company’s pipeline include:

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The Company also has greater China rights to Octreotide (Long Acting Injectable), a standard of care for the resttreatment of acromegaly and for the world. For in-licensed products,control of symptoms associated with certain neuroendocrine tumors; and Thiotepa, a cytotoxic agent which has a long history of established use in the hematology/oncology setting, the Company useshas an exclusive China license and distribution rights to a novel formulation of thiotepa, which has multiple indications including use as a conditioning treatment for certain allogeneic haemopoietic stem cell transplants.  However, due to the evolving standard of care environment, the rare and niche indication for these products, potential US regulatory action and the Company’s commitment to prioritize resources, the Company is currently evaluating its options for these products.  In addition, the Company’s assets include six FDA-approved ANDAs which the Company is evaluating due to generic drug pricing reforms by the Chinese government and its impact on the pricing and competitiveness of these products.

CASI has built a fully integrated, world class biopharmaceutical company dedicated to the successful development and commercialization of innovative and other therapeutic products. Our business development strategy is currently focused on acquiring additional targeted drugs and immuno-oncology therapeutics through licensing that will expand our hematology/oncology franchise. We use a market-oriented approach to identify pharmaceuticalpharmaceutical/biotechnology candidates that it believeswe believe to have the potential for gaining widespread market acceptance, either globally or in China, and for which development can be accelerated under the Company’sour global drug development strategy. ForIn many cases our FDA-approved ANDAs,business development strategy includes direct equity investments in the licensor company.  We intend for our pipeline to reflect a diversified and risk-balanced set of assets that include (1) late-stage clinical drug candidates in-licensed for China or global regional rights, (2) proprietary or licensed innovative drug candidates, and (3) select high quality pharmaceuticals that fit our therapeutic focus. We have focused on US/EU approved product candidates, and product candidates with proven targets or product candidates that have reduced clinical risk with a greater emphasis on innovative therapeutics. Although oncology with a focus on hematological malignancies is our principal clinical and commercial target, we intendare opportunistic about other therapeutic areas that can address unmet medical needs. We will continue to selectpursue building a robust pipeline of drug candidates for development and commercialize certain products from the portfolio that offer uniquecommercialization in China as our primary market, and cost-effective manufacturing opportunitiesif rights are available for the rest of the world.

We believe our China operations offer a significant market and growth potential due to the extraordinary increase in demand for high quality medicines coupled with regulatory reforms in China and/or inthat facilitate the U.S. For ENMD-2076, our current development is focused on niche and orphan indications.

Our focus is to bring high quality, cost-effectiveentry of new pharmaceutical products and innovative oncology therapeutics to patients.The implementation of our plansinto the country. We will include leveraging our resources in both the United States and China. In order to capitalize on the drug development and capital resources available in China, we are doing business in China through our wholly-owned China-based subsidiary that will execute the China portion of our drug development strategy, including conducting clinical trials in China, pursuing local funding opportunities and strategic collaborations, and implementing our transition to a commercial enterprise.

Our primary focus is to acquire high quality, cost-effective medicines, as well ascontinue to in-license clinical-stage and late-stage drug candidates, and leverage our cross-border operations and expertise, and hope to be the partner of choice to provide access to the China market. We expect the implementation of our plans will

include leveraging our resources and expertise in both the U.S. and China so that we can immediately employ our U.S. and China drugmaximize regulatory, development model to accelerate commercialization, and clinical and regulatory progress. In addition to our high quality, cost-effective medicines, and our clinical-and late-stage approach for innovative products, we have other potential drug candidatesstrategies in preclinical development which it will continue to evaluate in 2018.both countries.

Since inception,The Company’s commercial product, EVOMELA^®, was originally licensed from Spectrum Pharmaceuticals, Inc. (“Spectrum”) and the Company has incurred significant losses from operationshad a supply agreement with Spectrum to support the Company’s application for import drug registration and has incurred an accumulated deficitfor commercialization purposes. Spectrum completed the sale of $452.7 million.its portfolio of FDA-approved hematology/oncology products including EVOMELA^® to Acrotech Biopharma L.L.C. (“Acrotech”) on March 1, 2019. The Company restructured its business in 2012original supply agreement with Spectrum was assumed by Acrotech; Spectrum agreed to continue with a short-term supply agreement for EVOMELA^® for the initial commercial product supply in connection with an investment ledthe Company’s launch, with the long-term supply assumed by oneAcrotech.

As part of the Company’s largest stockholders, followed by implementationlong-term strategy to support our future clinical and commercial manufacturing needs and to manage our supply chain for certain products, on December 26, 2018, we established CASI Wuxi, between the Company and Wuxi LP, to develop a future GMP manufacturing facility that will be located in the Wuxi Huishan Economic Development Zone in Jiangsu Province, China. In November 2019, CASI Wuxi entered into a fifty-year lease agreement for the right to use state-owned land in China for the construction of a name changeGMP manufacturing facility. Pursuant to reflect its core missionthe agreement, CASI Wuxi has committed to invest land use right and business strategy.  The Company expectsproperty, plant and equipment of RMB1 billion (equivalent to continue$143 million) by August 2022. In April 2020, CASI Wuxi received RMB 15.9 million (equivalent to incur operating losses$2.2 million) from the Jiangsu Province Wuxi Huishan Economic Development Zone as government grant for this development project which was recorded as deferred income in April 2020. In November 2021, CASI Wuxi received an additional RMB 3.0 million (equivalent to $0.5 million) from the Jiangsu Province Wuxi Huishan Economic Development Zone as a government grant for this development project which was recorded as deferred income in November 2021. In 2020, for the foreseeabledesign and construction work of the land, CASI Wuxi entered into several contracts for RMB 76.1 million ($12.0 million) to complete the phase 1 project of CASI Wuxi's research and development production base, the project was the estimated to be completed in October 2023. In February 2022, CASI Wuxi has reached an alignment with the Wuxi local government that it will collaborate with Wuxi LP to co-develop the land continuously in the future, dueand the development plan will be extended, details regarding the plan are under negotiation. Also in 2020, CASI Wuxi entered in to among other factors, its continuing clinical activities. In March 2018,a lease agreement with local government for a manufactory building next to the leased land. Since then, the Company entered into securities purchase agreements pursuant to whicha series of contracts for the Company is issuing 15,432,091 shares of its common stock with accompanying warrants to purchase 6,172,832 shares of its common stock in a $50 million private placement (the “2018 Strategic Financing”). To date, the Company has received gross proceeds of $29.3 millionremodeling and expects to receive additional gross proceeds of $20.7 million in the near future. The 2018 Strategic Financing Closing included an investment from ETP Global Fund, L.P., a healthcare investment fund. The managing member of Emerging Technology Partners, LLC, which is the general partner of ETP Global Fund, L.P., is also the Executive Chairmaninstallation work of the Company.building and warehouse, as well as purchase of equipments. The 2018 Strategic Financing also included an investment from IDG-Accel China Growth Fund III L.P. (“IDG-Accel Growth”) and IDG-Accel China III Investors L.P. (“IDG-Accel Investors”). A director and shareholder of IDG-Accel China Growth Fund GP III Associates Ltd., whichtotal contract amount entered into for this building is approximately RMB 92.9 million ($14.6 million).

During the ultimate general partner of IDG-Accel Growth and IDG-Accel Investors, is also a board memberpeak of the Company. In October 2017,COVID-19 pandemic in 2020, we experienced disruptions to the Company entered into securities purchase agreements for an approximately $23.8 million strategic financing. The Company held its initial closing on October 17, 2017, a second closing on October 23, 2017 and a final closing on November 20, 2017 and received approximately $23.4 million in net proceeds, (collectively, the “2017 Closings”). Net proceeds from the 2018 Strategic Financing and the 2017 Closings are being used to prepare for the anticipated launch of the Company’s first commercial product in China, to support the Company’s business development activities, to advance the development of the Company’s pipeline, support itsEVOMELA^® marketing and commercial planningsales activities andas well as to the supply chain for other general corporate purposes

AsEVOMELA^®. The COVID-19 pandemic also impacted our targeted start time of our CID-103 trial due to the lock down of many medical facilities in Europe. During 2021, we have experienced minimal disruption to our business activities or supply chain as a result of the 2018 Strategic FinancingCOVID-19 pandemic. Furthermore, in June 2021 we achieved the First-Patient-In (FPI) in the Phase 1 dose escalation and expansion study of CID-103 in patients with previously treated, relapsed or refractory multiple myeloma. The study is designed to assess the 2017 Closings,safety, tolerability, pharmacology and clinical activity of CID-103.

We currently rely on a single source for the Company believes that it has sufficient resources to fund its operations at least through March 29, 2019. Assupply of December 31, 2017, approximately $12.2 millionEVOMELA^®. The continuation of the Company’s cash balance was held by CASI China. We intendCOVID-19 pandemic or the emergence of new COVID-19 variants or new pandemics may affect the economies and financial markets of many countries, which may result in a period of economic slowdown or recessions. In such an event, our ability to continue to exercise tight controls over operating expenditures. In developing drug candidates, we intendcommercialize and expand distribution of EVOMELA^® could be adversely affected if the supplier refuses or is unable to useprovide products for any reason (including the occurrence of an event like the COVID-19 pandemic that makes delivery impractical). We would have to work with Acrotech to negotiate an agreement with a substitute supplier, which, assuming a substitute supplier was available, would likely interrupt the manufacturing of EVOMELA^®, cause supply chain delays and leverage resources availableincrease costs.

The COVID-19 pandemic has adversely affected, and may continue to us in bothadversely affect, the United Stateseconomies and China. We intend to pursue additional financing opportunities as well as opportunities to raise capital through formsfinancial markets of non- or less- dilutive arrangements, such as partnerships and collaborations with organizations that have capabilities and/or products that are complementary to our capabilities and products in order to continue the development of our product candidates that we intend to pursue to commercialization.

Additional funds raised by issuing equity securitiesmany countries, which may result in dilutiona period of regional, national, and global economic slowdown or regional, national, or global recessions that could affect our ability to continue to commercialize and expand distribution of EVOMELA^® (Melphalan For Injection) or other drugs in our existing stockholders.product pipeline. Early in the COVID-19 pandemic, we experienced a disruption to our supply chain for EVOMELA®, we have experienced no supply disruption in 2021; however, there can be no assurance that restrictions will not be imposed again. In addition, economic and other uncertainties may adversely affect other parties’ willingness to negotiate and execute product licenses and thus hamper our ability to in-license clinical-stage and late-stage drug candidates in China or elsewhere.

CRITICAL ACCOUNTING POLICIES AND THE USE OF ESTIMATES

The preparation of our financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in our consolidated financial statements and accompanying notes. Actual results could differ materially from those estimates. Our critical accounting policies, including the items in our financial statements requiring significant estimates and judgments, are as follows:

Stock-Based Compensation

We record compensation expense associated with service and performance-based stock options in accordance with provisions of authoritative guidance. The determination ofestimated fair value of stock-based paymentservice-based awards is measured on the grant date and is generally amortized on a straight-line basis over the requisite service period and based on the proportionate amount of the requisite service period that has been rendered during each reporting period. The estimated fair value of performance-based awards is measured on the grant date and is recognized when it is determined that it is probable that the performance condition will be achieved. If the required vesting conditions are not met resulting in the forfeiture of the share-based awards, previously recognized compensation expense relating to those awards are reversed as occurred.

Grant date fair value was determined using the Black-Scholes valuationan option pricing model which is affected by our stock price,the fair value of underlying ordinary shares as well as the inputassumptions regarding a number of othercomplex and subjective assumptions. These assumptions include, but are not limited to, thevariables, such as expected forfeiturevolitality, expected term of options, risk-free rate, and expected termdividend yield.

Fair value measurement of stock options and our expected stockinvestment in equity interests of Juventas Cell Therapy Ltd. using the measurement alternative

The investment in the equity interests of Juventas was accounted for as an investment in equity securities using the measurement alternative at its cost, minus impairment, if any, plus or minus changes resulting from observable price volatility overchanges in orderly transactions for the termidentical or a similar investment of the awards. Changes in the assumptions can materially affectsame issuer, as the fair value estimates.of the equity securities of Juventas is not readily determinable. The fair value of such investment was determined based on the price in the orderly transaction for newly issued equity interests of Juventas, which is further adjusted to reflect the differences between the newly issued equity interests of Juventas and the Company’s investment.

Any future changes to our share-based compensation strategy or programs would likely affect the amount of compensation expense recognized.

RESULTS OF OPERATIONS

Years Ended December 31, 20172021 and 2016.2020.

Operating Items

Revenues

Revenues and Cost of Product Sales

Revenues consist of product sales of EVOMELA^® that launched during August 2019. Revenue was $30.0 million for the year ended December 31, 2021, compared to $15.0 million for the year ended December 31, 2020. Revenues increased by 100% in the year ended December 31, 2021, as compared to same period in 2020 due to the continued growth in EVOMELA^® sales.  

Lease Income

Lease income consists primarily of an equipment lease with Juventas (a related party). ThereLease income was $148,000 for the year ended December 31, 2021 compared to $140,000 for the year ended December 31, 2020.

Operating Expenses

Costs of Revenues

Costs of revenues consists primarily of the cost of inventories of EVOMELA^® and sales-based royalties related to the sale of EVOMELA^®.

Costs of revenues were no$12.6 million for the year ended December 31, 2021, as compared to $9.5 million for the year ended December 31, 2020. The increase of costs of revenues recordedprimarily resulted from the increase of EVOMELA sales during the same period. Included in our costs of revenues are royalty amounts of $5.9 million for the year ended December 31, 2021 and $3.0 million for the year ended December 31, 2020. The other primary components of our costs of revenues are cost of goods sold, which were approximately  $6.6 million and $6.6 million for the years ended December 31, 20172021 and 2016.

2020, and as a percentage of revenues were 22% in the year ended December 31, 2021, compared to 44% in the year ended December 31, 2020, with such decrease as a percentage of revenue mainly due to the alternate manufacturer in place, resulting in a considerable decrease in the unit cost of inventories of EVOMELA.

Research and Development Expenses.Expenses Our 2017 research and development expenses totaled $7,595,000 as compared to $4,646,000 in 2016, a 63% increase. In 2017, our research and development expenses reflect direct project costs of $856,000 for ENMD-2076, $3,603,000 for drugs in-licensed from Spectrum, and $1,301,000 for preclinical development activities primarily in China. The 2016 amount reflects direct project costs for ENMD-2076 of $1,696,000, $547,000 for drugs in-licensed from Spectrum, and $862,000 for preclinical development activities primarily in China. The increase in 2017 research and development spending primarily reflects higher costs associated with the quality testing phase of the CFDA regulatory review of ZEVALIN^® and EVOMELA^® in 2017.

At December 31, 2017, and, since acquired, accumulated direct project expenses for ENMD-2076 totaled $28,511,000, $4,536,000 for drugs in-licensed from Spectrum, and for preclinical development activities primarily in China, accumulated project expenses totaled $3,356,000. Our research and development expenses also include non-cash stock-based compensation totaling $272,000 and $746,000, respectively, for 2017 and 2016. The balance of our research and development expenditures includes facility costs and other departmental overhead, and expenditures related to the non-clinical support of our programs.

We expect the majority of our research and development expenses in 2018 to be devoted to advancing our in-licensed products towards market approval in China, the technology transfer activities and regulatory support associated with our ANDA portfolio, and our early-stage candidates in preclinical development. We expect our expenses in 2018 to increase based on our commercial and clinical development plan. Completion of clinical development may take several years or more, but the length of time generally varies substantially according to the type, complexity, novelty and intended use of a product candidate.

We estimate that clinical trials of the type we generally conduct are typically completed over the following timelines:

Global FDA Trial:

Local CFDA Trial:

The duration and the cost of clinical trials may vary significantly over the life of a project as a result of differences arising during the clinical trial protocol, including, among others, the following:

We test our potential product candidates in numerous preclinical studies to identify indications for which they may be product candidates. We may conduct multiple clinical trials to cover a variety of indications for each product candidate. As we obtain results from trials, we may elect to discontinue clinical trials for certain indications in order to focus our resources on more promising indications.

Our proprietary product candidates have also not yet achieved regulatory approval, which is required before we can market them as therapeutic products. In order to proceed to subsequent clinical trial stages and to ultimately achieve regulatory approval, regulatory agencies must conclude that our clinical data establish safety and efficacy. Historically, the results from preclinical testing and early clinical trials have often not been predictive of results obtained in later clinical trials. A number of new drugs and biologics have shown promising results in clinical trials, but subsequently failed to establish sufficient safety and efficacy data to obtain necessary regulatory approvals.

Our business strategy includes being opportunistic with collaborative arrangements with third parties to complete the development and commercialization of our product candidates. In the event that third parties take over the clinical trial process for one of our product candidates, the estimated completion date would largely be under the control of that third party rather than us. We cannot forecast with any degree of certainty which proprietary products or indications, if any, will be subject to future collaborative arrangements, in whole or in part, and how such arrangements would affect our capital requirements.

As a result of the uncertainties discussed above, among others, we are unable to estimate the duration and completion costs of our research and development projects. Our inability to complete our research and development projects in a timely manner or our failure to enter into collaborative agreements, when appropriate, could significantly increase our capital requirements and could adversely impact our liquidity. These uncertainties could force us to seek additional, external sources of financing from time to time in order to continue with our business strategy. There can be no assurance that we will be able to successfully access external sources of financing in the future. Our inability to raise additional capital, or to do so on terms reasonably acceptable to us, would jeopardize the future success of our business.

Research and development (R&D) expenses consist primarily of compensation and other expenses related to research and development personnel, research collaborations, costs associated with internal and contract preclinical testing and clinical trials of our product candidates, including the costs of manufacturing drug substance and drug product, regulatory maintenance costs of ANDAs, facilities expenses, and facilities expenses. Overall researchamortization expense of acquired ANDAs.

Research and development expenses increasedfor the year ended December 31, 2021 were $14.4 million, compared with $11.5 million for the year ended December 31, 2020. The increase in R&D expenses primarily due to $7,595,000an increase in 2017 from $4,646,000 in 2016.

The fluctuations in researchR&D expenses incurred related to the development of CID-103, BI-1206 and development expenses were specifically impacted by the following:

CB-5339.

General and Administrative Expenses.Expenses

General and administrative expenses include compensation and other expenses related to executive, finance, business development and administrative personnel, professional services, investor relations and facilities.

General and administrative expenses decreasedfor the year ended December 31, 2021 were $23.8 million, compared with $19.7 million for the year ended December 31, 2020. The increase in general and administrative expenses was primarily due to $3,156,000 in 2017 from $4,775,000 in 2016. This decrease is primarily related to a decrease of $1,871,000 in stock-based compensation expense, primarily related to stock options awarded in connection with the closings of the Company’s strategic financing in 2016, offset by an increase in salaryheadcount and benefits associatedpayroll expenses amounted to $2.7 million and an increase in professional fees amounted to $1.9 million.

Selling and Marketing Expenses

Selling and marketing expenses are the direct costs related to the sales of EVOMELA^® that was launched in China in August 2019, such as sales force salaries, bonuses, advertising, and other marketing efforts.

Selling and marketing expenses for the year ended December 31, 2021, were $14.7 million, compared with U.S. employees, including new business$7.8 million for the year ended December 31, 2020.  The increase is primarily due to the increase of sales commission in accordance with the  increase sales of EVOMELA.

Gain on disposal of intangible assets

There was no gain on disposal of intangible assets for the year ended December 31, 2021.

Gain on disposal of intangible assets for the year ended December 31, 2020 was $1.2 million. The gain on disposal during 2020 was primarily due to the $1.2 million gain on the sale of twenty-one ANDAs during the year.

Impairment of intangible assets

There was no impairment of intangible assets for the year ended December 31, 2021.

Impairment of intangible assets for the year ended December 31, 2020 was $1.5 million. The impairment of intangible assets was primarily due to the reduction of the carrying value of intangible assets to their fair value.

Acquired in-process Research and Development Expenses

Acquired in-process R&D expenses for the year ended December 31, 2021 were $6.6 million, compared with $17.8 million for the year ended December 31, 2020. The amount reported for the year ended December 31, 2021 consisted of the upfront payment of $5.5 million to Cleave for the development employees in 2017.of CB-5339 and milestone payments to Alesta of $1.06 million for the development of CID-

103. The amount reported for the year ended December 31, 2020 comprised of milestone fees paid to Pharmathen of $1.7 million, to Juventas of $10.3 million and to BioInvent of $5.9 million, respectively.

Non-Operating Items

Interest (income) expense,income, net.

Interest expense,income, net for the year ended December 31, 2021 was $0.3 million compared with $0.9 million for the year ended December 31, 2020. The decrease in interest income, net, is mainly due to that the amount reported for the year ended December 31, 2020 included interest income from loans made to Juventas (a related party) which was repaid in September 2020.

Other income

Other income for the year ended December 31, 2021 was $558,000, compared with $82,000 for the year ended December 31, 2020.  Other income of $51,000 and $35,000 recorded in the years ended December 31, 2021 and 2020, relate to CASI Wuxi’s receipt of RMB 15.9 million (equivalent to $2.2 million) in April 2020, and RMB 3.0 million (equivalent to $0.5 million) in November 2021 from the Jiangsu Province Wuxi Huishan Economic Development Zone as government grant for the development of leased state-owned land in China for the construction of a manufacturing facility. The grants were recorded as deferred income and amortized over the term of the lease of the land. Other income of $471,807 recorded in the year ended December 31, 2021 relates to the loan to the Company under the Paycheck Protection Program (PPP) that was forgiven in September 2021.

Foreign exchange gains and losses

Foreign exchange gains (losses) for the year ended December 31, 2021 was gain of $0.3 million compared with losses of $1.3 million for the year ended December 31, 2020. The foreign exchange gains (losses) are primarily due to accounts receivable with CRPCGIT and USD denominated cash accounts that are held by our Chinese subsidiaries.

Change in fair value of investments

The change in fair value of investments for the years ended December 31, 20172021 and 20162020 was $(1,009)$5.7 million and $26,090,$4.3 million respectively. This includes interest expenseThe changes represent unrealized gains or losses on our note payablethe Company’s investments in equity securities and long-term investment.

Impairment loss of $7,500 for both years; non-cash interest expenselong-term investments

Impairment loss of $7,476 and $26,308, respectively, representing the amortization of the debt discount; offset by interest income of $15,985 and $7,718, respectively.

Change in fair value of contingent rights. The Contingent Rights issued to Spectrum in connection with the license arrangements are considered derivative liabilities and were recorded initially at their estimated fair value, and are marked to market each reporting period until settlement. The change in fair value of the Contingent Rightslong-term investments for the yearsyear ended December 31, 2017 and 20162021 was $19,891 and $6,788, respectively.$865,000 relating to the investment in a privately held UK Company, Black Belt Tx”. The Company did not record any impairment loss of long-term investments during the year ended December 31, 2020.

LIQUIDITY AND CAPITAL RESOURCES

To date, we havethe Company has been engaged primarily in research and development activities. As a result, we havethe Company has incurred and expect to continue to incur operating losses in 20182022 and the foreseeable future before we commercialize any products and penetrate significant markets such as China. Based on our current plans, we expect our current available cash and cash equivalents to meet our cash requirements for at least through March 29, 2019.future.

WeThe Company will require significant additional funding to fund operations beyond the first quarter of 2023 until such time, if ever, we becomeit becomes profitable. We intendThe Company intends to augment ourits cash balances by pursuing other forms of capital infusion, including strategic alliances or collaborative development opportunities with organizations that have capabilities and/or products that are complementary to ourits capabilities and products in order to continue the development of ourits potential product candidates that wethey intend to pursue to commercialization. If we seekthe Company seeks strategic alliances, licenses, or other alternative arrangements, such as arrangements with collaborative partners or others, to raise further financing, weit may need to relinquish rights to certain of ourits existing product candidates, or products wethey would otherwise seek to develop or commercialize on ourits own, or to license the rights to ourits product candidates on terms that are not favorable to us.it.