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DisclaimerNOT FOR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES, CANADA, JAPAN OR ANY JURISDICTION WHERE SUCH DISTRIBUTION IS NOT PERMITTED UNDER THE LAW
OF THAT JURISDICTION
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2
Background of the Industry
Business and Finance
Future Strategies
Company Overview
Research Progress
Investment Highlights
3
GenScript’s mission
Our aspiration – to change the world by using breakthrough technologies
• Make research easier for scientists by using gene synthesis technology
• Make our life better by using synthetic biology technologies
• Provide better cell therapies to the cancer patients
4
GenScript’s business blueprint
• GenScript proprietary technologies
• Core business generating cash flow for future
development
• New area of business development
generating higher return
Life sciences research and
application services and products
Gene synthesis
Industrial enzymes CAR T-Cell Immunotherapy
5
• GenScript is a well-recognized life sciences research, and application service and product provider. As the
leader in gene synthesis, GenScript has developed a number of services and products in for synthetic
biology
• Largest provider of gene synthesis services globally
• Global provider of life sciences research and application services and products
• Well recognized and trusted provider of for synthetic biology research and application services
and products
• Founded in 2002 in the U.S.
• GenScript holds multiple IPs and know-how proprietary technology in the area of synthetic biology
• Key locations in New Jersey, Nanjing, Europe, and Japan
• Research and manufacturing facilities globally
• Over 1,500 employees globally1
• 5,000+ customers1 which includes global pharmaceutical and biotech companies, colleges and
universities, research institutes, government organizations and distributors in over 100 countries
• Renowned Investors which include Kleiner Perkins Caufield & Byers, Shipston Group Limited, China
Resource Group and The Balloch Group
GenScript overview
1 Note: as of December 31, 2016
6
2002 2004 20082009
2011
2014
GenScript’s history and key milestones
• Introduced
Gene Synthesis
Service
• Introduced
Custom Protein
and Antibody
Service
• Established
presence in Europe
• Selected as the only
commercial entity to
participate in the Synthetic
Yeast Genome Sc2.0
Project
• Established subsidiary in
Japan
• Employee headcount
reached 1,000
• Founded in
New Jersey • Established
research and
manufacturing
center in
Nanjing, China• KPCB / TBIG
Healthcare investment
• New Nanjing
research and
production facility
opened
• Developed GenPlusTM
next generation gene
synthesis technology
• Developed the industrial-
leading composite
glucosydase product for
starch processing industry
• Developed the half-life
extension technology for
single domain antibody
drugs
• CRO Leadership
award
2013
• Launched the
industrial
synthetic
biology product
segment
2003
2015
• Listed in HKEX
(Stock code:1548)
2016
• Merged Nornoon
Company
• Invested in Zhenjiang
• Launched eStain
L1,an innovative
instrument
• Launched new and
stable cell lines
• Achieved
breakthrough for
CAR T-Cell
Immunotherapy
7
Senior Management
Venture Capital Investors
GenScript’s management team
Mr. Robin MENG, VP Finance
Manager, Schering-Plough, China, 2000-2004
Controller, Saint-Gobain, 2004-2007
CFO, Quay Magnesium, 2008-2010
VP Finance, GenScript, 2010
Dr. Frank ZHANG, CEO
PhD, Duke University, 1995
Schering-Plough, 1995-2002
GenScript Co-founder, 2002
Ms. Sally WANG, COO
MS, Wuhan University, 1993
Shenzhen Futian, Environmental Protection
Surveillance Station, 1993-2000
GenScript Co-founder, 2002
Dr. Li ZHU, VP Strategy
VP Research, Cathay Biotech, Inc., 2006-2008
VP Strategy, GenScript, 2010
8
Background of the Industry
Business and Finance
Future Strategies
Company Overview
Research Progress
Investment Highlights
9
Gene, DNA, protein and antibody
Gene and DNA
• A gene is a molecular unit of heredity of a living organism
• DNA is a polynucleotide formed from covalently linked
deoxyribonucleotide units
• There are four types of bases: A, T, C, G. A pairs with T, and
G pairs with C
• Each chromosome is made up of DNA and proteins called
histones. The protein tightly coils the DNA to support the
chromosome’s structure
• Human has 23 pairs of chromosome – in particular men have
XY chromosome while women have XX chromosome
Protein and antibody
Source: http://29lifescience.wikispaces.com
Source: https://www.smartpatients.com
10
Background information:
what are gene synthesis and synthetic biology?
Gene synthesis
Synthetic biology
• Do not rely on natural source for genes
• Synthesize genes from chemicals
• Able to synthesize genes as designed
• The design and construction of novel
biological parts, devices, and systems,
and the re-design of existing, natural
biological systems for the purposes of
improving usefulness
One of the fundamental techniques in synthetic biology
HealthDisease
treatment
Anti-aging
EnergyFuel
Energy crops
IndustrialChemicals
AgricultureBreeding
Nitrogen
fixation
EnvironmentDetection
Bioremediation
Using
Genes…
to Program Cells
to Become
Cellular
Factories…to Make High
Value Products
(e.g. artemisinin…)
……
Application
11
Development of synthetic biology
1812555-001
In 1972, the Chinese scientist Tu Youyou and her colleagues
extracted artemisinin from the herb Qinghao and received
Nobel Prize in 2015.
Jay Keasling’s laboratory at the University of California, Berkeley
has engineered both Escherichia coli and Saccharomyces cerevisiae
to produce of artemisinic acid, a precursor to artemisinin.
12
• A segment of biology that emerged in the 21st century focusing on the artificial
design and engineering of biological systems
• Aims to create life molecules with new properties that can be applied to drug
discovery, industrial raw materials and fuel substitutes
Background information:
Synthetic Biology
Research method
Bottom-up
Top-down
Sources: http://syntheticbiology.org/
13
• Basic molecules of life are redesigned, synthesized, assembled, and consolidated
through metabolic pathways and networks, to systematically construct a brand new
biological system
Background information:
A) Bottom-up
Oligonucleotide
Individual geneSynthesis
Package
Gene modules Assemble
Metabolic pathway
Consolidate
Metabolic network
Allocate
Functional Bacteria
Complex new system
Construct
Source: [1] The Making of the Fittest: DNA and the Ultimate Record of Evolution ,W.W. Norton, 2006,
[2] http://fdatraining.wifss.ucdavis.edu
14
Background information:
B) Top-down
Sources: Andrianantoandro, et al., Mol Syst Biol, 2006.
Modification and redesign of
existing natural biological
system to achieve better
performance
Systematically search and
modify key cells, pathways,
and biochemical reactions
layer by layer, down to the
most fundamental proteins,
DNA, and RNA, in order to
achieve target modification
15
Background information:
Examples of synthetic biology applications
Industry enzyme Oil-eating bacteria CAR T-cell Therapy
Blood from patients
T cell
Modified T cell
Re-introduce to the
patients
Virus
16
Background information:
Examples of synthetic biology applications (cont’d)
Synthetic organs Biofuel
Green chemistry Animal breeding
Antibiotics, amino acids and vitamins Natural products
• To create artificial organs from hybrid animals, instead of
transplant
• Artificial cornea or liver can be made from genetically
engineered pigs or other animals
• For cornea alone, there are 4mn patients in China
• Synthetic biology technologies are widely used in biofuel
generation
• The emergence of advanced conversion pathways and non-
food feedstocks could unlock considerable production potential
• Multi-billion dollar market potential
• Many of the chemical processes can be converted into
biological processes, using synthetic enzymes as catalyst
• Multi-billion dollar market potential through direct cost savings
and avoided liability for environmental and social impacts
• By using synthetic biology, new microbes can be made from de
novo, and the most productive microbes can be obtained in
record time
• Huge market globally for antibiotics, amino acids and vitamins
products
• Synthetic biology are widely used in animal breeding.
• Compared with traditional breeding, synthetic biology is much
faster and saves cost. Totally new species can be developed
using this method.
• Multi-billion dollar market potential.
• Plant genes and pathways can be moved into bacteria and
microbes by synthetic biology technologies to produce taxol,
artemisinin, isoprene rubber, saffron, vanillin, and flavor and
fragrance
• Multi-billion dollar market potential
17
Background of the Industry
Business and Finance
Future Strategies
Company Overview
Research Progress
Investment Highlights
18
GenScript’s service, product & research overview
• Comprehensive research services in 6 key sub-segments: gene synthesis,
oligonucleotide synthesis, DNA sequencing, protein production, peptide
synthesis and antibody development
• Widely used in and fundamental to life sciences research and application
• Pre-packaged, ready-to-use, and off-the-shelf products
• Integrated services in 3 key sub-segments: antibody and protein engineering,
in vitro pharmacology service, and in vivo pharmacology service
• Applied in disease studies and drug discovery process
• Launched first product series: glucoamylases, pullulanase and amylase
• Fundamental life sciences research
• Early stage pharmaceutical
development
• Translational biomedical research
• Industry users of industrial enzymes
Life sciences research
services
Life sciences research
catalog products
Preclinical drug
development services
Se
rvic
es
Pro
du
cts
Industrial synthetic
biology products
Target customer industry /
applications
• Achieved promising results in the research and development in immunotherapy
technology for multiple myeloma cure
• Achieved promising results in the joint research and development in design and
synthesis of the saccharomyces cerevisiae chromosomes (Project Sc2.0), the
relevant paper was published in Science
Cell Therapy
Development
Re
se
arc
h
Other research on
biotechnology
19
Key service Applications Sample picture
Gene synthesis
Synthesized gene products are used for
functional research of genes and protein
production for synthetic biology, life science
research, and biologics drug discovery
Protein production
Proteins produced are used for functional
studies of proteins, such as in vivo and in
vitro biochemical and immunological studies,
and as antigens for antibody development
Antibody development
Antibodies developed are used for
immunology experiments and assays and
preclinical antibody drug lead generation
Peptide synthesis
Synthesized peptides are used for protein
structural studies, protein-protein interactions
studies, and as antigens for antibody
development
GenScript service and product offerings –
life sciences research services
20
GenScript service and product offerings –
industrial synthetic biology products
Industrial enzyme products market
• Industrial enzyme can be used in a variety of industries, such as the food processing, feed pharmaceutical, and chemical
industries
• Industrial enzyme market globally totals approx. US$4.5bn, Chinese market approx. US$900mn
2016 China market
breakdown by
product category
Enzymes
Household Care
Technical & Pharma
Bioenergy
Feed & Agriculture
Food & Beverage
21
1812555-001
New segment with growth potential
• Launched in 2013
• Growing by leveraging our technical expertise in gene synthesis and synthetic biology
• Successfully created a series of industrial enzyme products to meet the wide demands and stringent requirements in the
starch processing industry
GenScript’s launched products and pipelines
• Blended glucoamylases: HighDEX series
• Advanced Thermo / acid-stable alpha-amylase:SuperLIQ
GenScript service and product offerings –
industrial synthetic biology products
Thermostable
α-amylase
Glucoamylase
Pullulanase
Glucose
isomerase Glucose
oxidase Catalase
Fungal
amylase
22
GenScript has multiple breakthrough IPs and know-how in the area
of synthetic biology
OptimumGeneTM gene design system, which
optimizes gene sequences to achieve increased
levels of production in subsequent protein
expression
1 :as of the Latest Practicable Date
20 registered patents and 48 pending patent applications in the U.S. and the PRC1
CloneEZ® cloning system, which provides a
quick and efficient DNA cloning system
including techniques and reagent kits
GENE-ON-DEMAND® gene synthesis
technology, which is used for high-through put
gene synthesis
GenPlusTM next generation technology,
which synthesizes genes using chip-based
oligos
23
Developed services and products
• MonoexpressTM antibody production
• GenPlusTM gene synthesis services
• eStain® protein staining related products
• eBlot® protein transfer related products
• ExpressPlus PAGE gel
• Monoaffinity Protein A resins
• Antibodies, cytokines, etc.
Ongoing R&D projects
• Microbial knock-out and knock-in technology
• Next-generation high-throughput gene synthesis
• Industrial microbial strain generation and process development
• CAR T-Cell Immunotherapy
Continue to invest in R&D
In-house R&D efforts
• More than 140 R&D staff as of Dec. 31, 2016
• Over 13% of our R&D staff possess doctoral degrees in
life sciences- related disciplines in biology, molecular
biology, genetics, biological engineering, immunology, etc.
• 4 R&D teams serving four business segments including
Biotechnology Research Institute and Molecular Biology
Research Institute
R&D teams
R&D investment
6.1 5.6
7.1
9.5
2013 2014 2015 2016
0
2
4
6
8
10
R&D expenses ($mm)
• As of Dec. 31, 2016, over 22,610 international peer-reviewed journal articles had cited the use of GenScript’s life
sciences research and application services and products
• In March 2017, GenScript published promoting result on Science regarding the joint research and development in
the Synthetic Yeast Genome Sc2.0 Project
24
Europe
Direct Sales
Austria
Bosnia Herzegovina
Belgium
Bulgaria
Switzerland
Czech
Germany
Denmark
Estonia
Spain
Finland
France
United Kingdom
Gibraltar
Greece
Croatia
Hungary
Ireland
Iceland
Italy
Lithuania
Luxembourg
Latvia
Monaco
Moldova
Malta
Netherlands
Norway
Poland
Portugal
Romania
Scotland
Sweden
Slovenia
Slovakia
Distributors
Belgium
Czech Republic
Denmark
France
Germany
Hungary
Italy
Poland
Spain
Switzerland
The Netherlands
UK
Asia
Direct Sales
The United Arab
Emirates
Armenia
Bangladesh
Bahrain
Palestine
Brunei Darussalam
China
Cyprus
Georgia
Hong Kong
Indonesia
Israel
India
Jordan
Japan
Cambodia
South Korea
Kuwait
Kazakhstan
Sri Lanka
Malaysia
Nepal
Oman
Philippines
Pakistan
Qatar
Saudi Arabia
Singapore
Thailand
Turkey
Taiwan
Vietnam
Distributors
Bangladesh
China
India
Indonesia
Israel
Japan
Korea
Malaysia
Pakistan
Singapore
Taiwan
Turkey
Africa
Direct Sales
Benin
Botswana
Cameroon
Ethiopia
Gabonese
Gambia
Kenya
Morocco
Namibia
Nigeria
Senegal
Swaziland
Tunisia
Uganda
South Africa
ZambiaAustralia
Direct Sales
American Samoa
Australia
Northern Mariana
Islands
New Zealand
French Polynesia
Distributors
Australia
New Zealand
South America
Direct Sales
Argentina
Bolivia
Brazil
Chile
Colombia
Ecuador
French Guiana
Peru
Uruguay
Venezuela
Distributors
Brazil
North America
Direct Sales
Bermuda
Canada
Costa Rica
Cuba
Mexico
Trinidad & Tobago
United States
Puerto Rico
The United States Virgin
Islands
Distributors
Canada
USA
The locations of our major operating
subsidiaries and representative office
Nanjing, China
Hong Kong
New Jersey, US
Tokyo, Japan
Amsterdam, Netherland
Subsidiaries
Representative
office
Global presence
• Founded in New Jersey, USA in 2002
• Major operating subsidiaries and representative office in PRC, Hong Kong, U.S.
Japan and the Netherlands
• Established on extensive direct sales network, reaching over 100 countries in North
America, Europe, the PRC, Asia Pacific excluding the PRC and Japan, and Japan
25
Strong sales and marketing team
Well trained sales and marketing specialists
Interactive online ordering system
• Our success is attributed to our sales and marketing teams
with presence in the U.S, EU, Japan. and the PRC
• Nearly 90% of our U.S. sales and marketing team have
doctoral or master’s degrees in life sciences- related
discipline
• Customers navigate directly to our websites to browse online
information of most of our services and products
• Our system allows for specification and customization of
each order through the option to choose features and
components from an online menu
Purchase order data
On the ground52.6%
Online47.4%
No. of purchase orders as of Dec. 31, 2016
26
Diverse and global customer base
Customer breakdown by customer category1
Pharmaceutical and biotech co.
59.7%
Colleges and universities
19.8%
Research institutes
12.8%
Government institutions
2.9%
Distributors and others
4.8%
1 :for the six months ended Dec. 31, 20162 :as of Dec. 31, 2016
Customer breakdown by region2
5,000+ customers2 which include global pharmaceutical and biotech companies, colleges and universities,
research institutes, government organizations and distributors in over 100 countries
North America53.5%
Europe15.9%
APAC (excl. PRC & Japan)
18.9%
PRC6.9%
Japan3.4%
Others1.4%
27
2016 Financial Results Overview
Achieved strong net profit YoY growth of 51.4%.
Achieved gross margin YoY increase of 0.6 percent.
Core services (life sciences research services) maintained
market leadership and growth momentum.
Revenue of life sciences research services amounted to
US$91.2 million, representing an increase of 18.6%.
Gross profit margin varied from 66.4% for the same period
last year to 65.8% this year, and maintained at a stable level.
Exerted considerable effort in simplifying the internal workflow
of gene synthesis to shorten the turnaround time, enabled to
maintain leadership position in gene synthesis.
Revenue of industrial synthetic biology products increased
by 400.0% to US$7.0 million. We have also been actively
developing new products in the field of special enzymes.
Continued to strengthen online ordering system. A new
and upgraded online ordering system has been launched
to improve the online ordering experience.
Key Highlights of 2016 Results 2016(US$MM)
2015(US$MM)
Change
Revenue 114.7 86.7 32.3%
Gross Profit 76.2 57.1 33.5%
Gross Margin 66.4% 65.8% 0.6
Net Profit 26.5 17.5 51.4%
Net Profit Margin
23.1% 20.01% 3.19
Adjusted EBITDA*
39.5 28.1 40.6%
Adjusted Net Profit*
26.5 14.3 85.3%
Adjusted Net Profit Margin
23.1% 16.5% 6.6
*Note: Adjusted EBITDA=EBITDA + IPO cost - one-off net gains
Adjusted net profit= Net profit + IPO cost - one-off net gains
28
12.8 16.328.1 39.5
21.3% 23.3%
32.4%34.4%
Adjusted EBITDA (US$mm)
Adjusted EBITDA margin
6.4 9.518.9
28.410.7%
13.5%
21.8%24.7%
Adjusted net profit (US$mm)
Adjusted net profit margin
60.1 70.086.7
114.7
2013 2014 2015 2016
38.3 44.157.1
76.2
63.7%63.0%
65.8%66.4%
2013 2014 2015 2016
Gross profit (US$mm)Gross margin
Financial highlights
Gross profit and gross marginRevenue
US$mm
US$mm
Adjusted net profit and adjusted net profit marginAdjusted EBITDA and adjusted EBITDA margin
• Dropping of adjusted EBITDA and adjusted net profit from 2013 to 2014/2015 mainly due to effect of increased operation size and hence increased administrative and other expenses
Note: Adjusted EBITDA=EBITDA + share-based payment + IPO cost - one-off net gains
Adjusted net profit= Net profit + share-based payment + IPO cost - one-off net gains
2013 2014 2015 2016 2013 2014 2015 2016
29
Financial highlights – segment revenue
Preclinical drug development servicesLife sciences research services
55.4 63.276.9
91.2
2013 2014 2015 2016
US$mm
Industrial synthetic biology products1Life sciences research catalog products
1 Note: this segment was launched in 2013 and started sales in 2014
3.2 4.46.0
11.2
2013 2014 2015 2016
US$mm
1.5 2.0 2.5
5.3
2013 2014 2015 2016
US$mm
0.0 0.3 1.4
7.0
2013 2014 2015 2016
US$mm
–
30
Financial highlights – segment gross profit and gross margin
Preclinical drug development services
35.4 39.951.5
63.2
64.0%63.2%
67.0%
69.3%
2013 2014 2015 2016
US$mm
Life sciences research services
0.9 1.4 1.6
3.5
58.3%66.5% 64.4% 66.0%
2013 2014 2015 2016
Life sciences research catalog products
US$mm
0 0 0.074
2.019
5.5%
28.8%
2013 2014 2015 2016
Industrial synthetic biology products1
US$mm
1 Note: this segment was launched in 2013 and started sales in 2014
1.9 2.83.9
7.560.2%
63.8%
65.2%
67.2%
0.56
0.58
0.6
0.62
0.64
0.66
0.68
2013 2014 2015 2016
US$mm
31
Financial highlights – key ratios
30 33 33 35
2013 2014 2015 2016
Average trade receivables
turnover days
22 2226
35
2013 2014 2015 2016
Average trade payables
turnover daysAverage inventory turnover days
13.3%
16.5%17.9%
17.0%
2013 2014 2015 2016
8.1%
10.7%
13.8% 13.9%
2013 2014 2015 2016
Adjusted ROE1 Adjusted ROA2
1 Adjusted ROE was calculated based on adjusted net profit for the respective periods divided by the average total equity for the same periods and multiplied by 100%2 Adjusted ROA was calculated based on adjusted net profit for the respective periods divided by the average total assets for the same periods and multiplied by 100%
56 6065
61
2013 2014 2015 2016
32
Background of the Industry
Business and Finance
Future Strategies
Company Overview
Research Progress
Investment Highlights
33
Strategies and development direction
1812555-001
Increase investment in research and development projects like cell therapy and other applications to expand our research and application service and product portfolio;
Enhance production capacity to capitalize on the strong demand for our life sciences research and application services and products;
Pursue strategic acquisitions and cooperation against the cutting-edge techniques to complement organic growth.
Increase penetration into the overseas and PRC markets by expanding and strengthening our sales and marketing team.
Strategic development
34
Investment in Zhenjiang
1812555-001
• Choose Zhenjiang New District as new
production base after the careful evaluation.
• The investment agreement. was signed on
June 20,2016.
• Investment and registered capital: US$30
million (in two phases).
• Zhenjiang will be one of our major production
base in the future while Nanjing will play the
role of R&D base.
• Transfer part of the life sciences research
services business.
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Acquisition of 51% equity interests in Nornoon
• Approx. 140 Employees
• The investment fund will be used to enhance Nornon’s
capacity in order to support the rapid growth of its sales
on the future.
• FY2015:Revenue:CNY37.6M,Net profit : CNY4.7M
Nornoon’s plant Nornoon’s facility
• The Investment and Cooperation Agreement was signed on
April 6, 2016.
• Acquired 51% of the equity on June 30,2016
• The Consideration payable is CNY53M (equivalent to
approximately US$8M).
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Background of the Industry
Business and Finance
Future Strategies
Company Overview
Research Progress
Investment Highlights
37
Legend global leading status in multiple myeloma cure
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The sixth MM patient
The 18th day after treatmentBefore treatment The 83rd day after treatment
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Legend global leading status in multiple myeloma cure
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About Multiple Myeloma
MM is the second most common hematological malignancy after non-Hodgkin’s lymphoma
Morbidity rate
Developed countries
4/100,000
Treatment cost
$132,615/case
Estimated charge
$500,000/case
China
1/100,000
7.1/100,000 4.6/100,000
750,000 patients worldwide
approximately 114,000 new cases annually
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Achievement on the Synthetic Yeast Genome Sc2.0 Project
The Group has achieved promising results in the joint research and
development effort with various international research and development
institutions in the field of synthetic genomics with the aim to newly design and
synthesize all 16 saccharomyces cerevisiae chromosomes, at the total length
of 12 million base pair (Project Sc2.0).
Under the Joint Research and Development Project, scientists from the Group
and various international institutions have completed the design, assembling
and synthesis of five chromosomes, of which the Group has been involved in
the synthesis of the number six chromosome. The result has been published in
Science, a leading international science journal, entitled “Synthesis,
Debugging, and Effects of Synthetic Chromosome Consolidation: synVI and
Beyond”, on March 10, 2017.
In this project, Genscript synthesized 17 long genes, the average length is
around 10kb and the total length is over 170kb.
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Background of the Industry
Business and Finance
Future Strategies
Company Overview
Research Progress
Investment Highlights
42
Investment highlights
• We have achieved world market leadership in the global gene synthesis service market with recognized stature in
synthetic biology, and we offer a broad and integrated life sciences research and application service and product
portfolio
• We are a well-known and trusted brand underpinned by our high quality life sciences research
and application services and products
• We maintain a strong sales and marketing team and operate an interactive online quotation and
ordering platform to support our global sales
• We possess strong research and development capabilities, with a proven track record and a
robust service and product pipeline
• We have an experienced and professional management team supported by a strong talent base
We have a complete and mature enzyme production line to serve the broad industrial market
• We have achieved innovative breakthrough for CAR T-Cell Immunotherapy in clinical trial