ENVALITH
株式会社ジーエヌアイグループ logo

GNI Group Ltd.

2160・Growth Market・Pharmaceuticals

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株式会社ジーエヌアイグループ logo
GNI Group Ltd.2160

Business

GNI Group, Inc. is a global healthcare company headquartered in Tokyo, operating businesses in China, the United States, and Japan. In its pharmaceutical business, the company's mainstay product is Etuary (pirfenidone), a treatment for pulmonary fibrosis currently sold in the Chinese market, while it also advances drug discovery through its next-generation candidate F351 (for hepatic fibrosis) and Cullgen's protein degradation induction technology platform uSMITE™. In its medical device business, its US subsidiary Berkeley Biologics (BB) manufactures and sells biomaterial products derived from placenta, skin, and bone, and in December 2025 the company acquired ZOO LABO, a Japanese dental laboratory business. The group consists of 24 consolidated subsidiaries and 2 affiliated companies, with consolidated revenue of ¥26,840 million for FY2025 (ending December 2025).

Business Model

The core of revenue is direct sales of Aisuliru in the Chinese market by GYRE Pharmaceuticals (¥17,314 million in FY2025 (ending December 2025)). This serves as a stable revenue source funding R&D expenses (¥3,298 million), while pursuing the NDA filing and post-approval launch of F351, as well as license income from Cullgen's option and milestone arrangement with Astellas (an opportunity exceeding US$1.9 billion at maximum). The medical device business (BB) secures profitability through the manufacture and sale of biomaterials, contributing to overall group revenue stability under a dual-pillar structure.

Company Strengths

Ai-SooLutions' revenue for FY2025 (ending December 2025) reached a record high of ¥17,314 million (up 9.3% year on year). The product is already listed in China's National Reimbursement Drug List (2017 edition), and sales to its principal distributor Sinopharm reached ¥6,744 million (25.1% of total company sales), reflecting a stable sales base.

Berkeley Biologics (BB)'s revenue for FY2025 (ending December 2025) was ¥7,584 million (up 46.2% year on year), and operating profit was ¥1,274 million (up 35.3% year on year), both record highs exceeding budget. A new large-scale transaction with New Horizon Medical (¥3,319 million) contributed to growth, along with expansion of a diverse product lineup derived from placenta, skin, and bone.

Under the joint research and exclusive option agreement with Astellas Pharma concluded in June 2023, an upfront payment of US$35 million has already been received. An additional US$85 million is payable upon exercise of the option, with the potential for up to US$1.9 billion in milestone payments plus royalties, establishing external validation of the uSMITE™ technology.

ENVALITH's Perspective

Operating loss for 1Q FY2026 significantly deteriorated to ¥2,749 million from a loss of ¥772 million in the same period last year. Revenue reached only ¥5,526 million (up 3.9% year-on-year), a modest increase, while expenses expanded across the board: selling, general and administrative expenses rose to ¥5,459 million (up 42.7% year-on-year), personnel expenses to ¥2,018 million (up 47.1%), and R&D expenses to ¥1,053 million (up 30.6%). The main drivers were F351 commercialization preparation costs, Cullgen acquisition advisory fees (one-time), and increased share-based compensation expenses. It is necessary to distinguish between structural cost increases and one-time cost increases when evaluating this.

The NDA acceptance for F351 (May 2026) and its designation for priority review represent concrete progress, and if approval and launch materialize, this could become a turning point in the earnings structure. However, even under the priority review system, the review period and approval outcome remain uncertain, and the pace of market penetration and pricing after launch are also unknown factors. Additionally, the planned IND application for the MASH indication in the US, scheduled for the end of 2026, remains at an early stage. The full-year FY2026 (ending December 2026) earnings forecast discloses only revenue (¥27,158 million), with no profit forecast disclosed, meaning visibility into performance remains poor for investors.

Cash flow from operating activities in 1Q FY2026 showed an outflow of ¥415 million (versus an outflow of ¥287 million in the same period last year), and investing activities also turned to an outflow of ¥916 million (versus an inflow of ¥1,151 million in the same period last year). Cash and cash equivalents stood at ¥19,869 million at period-end, down ¥1,232 million from the previous fiscal year-end (¥21,101 million). Against total assets of ¥82,595 million, the ratio of equity attributable to owners of the parent was 60.6%, indicating that the financial base has been maintained to a certain extent. However, with F351 launch preparations, Cullgen integration, and multiple clinical trials proceeding in parallel, upfront investment is expected to continue, making the management of capital efficiency an important point to watch going forward.

Growth Strategy

Pursuing global growth along three axes: F351 approval and launch, Cullgen integration and clinical progress, and medical device business expansion

The NDA was submitted in March 2026, and formal acceptance notice was received from the CDE in May 2026, with review currently proceeding under the priority review system. F351 has obtained Breakthrough Therapy designation and Priority Review designation, and approval is expected on a shortened timeline compared to standard review. If approval and launch are realized, this could fundamentally improve the revenue structure of the pharmaceutical business.

Gyre Therapeutics (Nasdaq: GYRE) expects to file an IND application by the end of 2026 in order to initiate a Phase 2 clinical trial of F351 in the US for the indication of MASH-related liver fibrosis. This is positioned as a first step toward global expansion leveraging the approval track record in China.

On May 4, 2026 (US time), Gyre made Cullgen a wholly-owned subsidiary through a stock exchange. Following the integration, Gyre is developing into a fully integrated biopharmaceutical company with revenue-generating commercial assets and a pipeline spanning multiple therapeutic areas centered on fibrosis and inflammatory diseases. The combination of China's cost-efficient innovation infrastructure with US management is expected to accelerate TPD and DAC drug discovery. The impact on consolidated results is currently being calculated.

A Phase 1 clinical trial targeting acute and chronic pain was completed in Australia in December 2025, reporting favorable results. A Phase 2 clinical trial targeting acute pain following bunionectomy is planned to begin in the US in H1 2026. A Phase 1/2 trial targeting solid tumors is also proceeding in parallel in China.

ZOO LABO, which became a consolidated subsidiary in December 2025, contributed to results from Q1 2026 onward, and medical device business revenue reached a record high for a first quarter (¥1,553 million). Increased revenue and profit are also expected from the planned launch of BAB's new product sales (FY2026, ending March 2027). However, due to increased startup costs for two new businesses, the segment posted a loss of ¥341 million (compared to a profit of ¥115 million in the same period of the previous year), and progress toward profitability is a point of focus.

Last updated: July 17, 2026