Executive Summary / Key Takeaways

• ArriVent BioPharma is a clinical-stage biopharmaceutical company focused on licensing and developing innovative oncology therapeutics, with a lead candidate, firmonertinib, targeting specific, underserved mutations in non-small cell lung cancer (NSCLC).
• Firmonertinib, a third-generation EGFR TKI, has shown promising interim clinical data in NSCLC patients with EGFR exon 20 insertion and PACC mutations, areas where existing therapies offer limited options, positioning it as a potentially differentiated treatment.
• The company is strategically expanding its pipeline through collaborations and licensing, notably adding an antibody-drug conjugate (ADC) program (ARR-217) for gastrointestinal cancers via a significant upfront payment in Q1 2025, diversifying its therapeutic focus beyond NSCLC.
• ArriVent is in a high-investment phase, reflected in a substantial increase in R&D expenses ($61.3 million in Q1 2025, including the $40 million Lepu upfront payment) and significant operating losses ($66.8 million in Q1 2025).
• With $205.5 million in cash and investments as of March 31, 2025, supplemented by a new credit facility and ATM program, the company believes it has sufficient capital for at least twelve months, but successful clinical development and pipeline expansion will necessitate further financing.

ArriVent BioPharma: Building a Niche Oncology Player

ArriVent BioPharma, founded in April 2021, embarked on a strategic path centered on identifying, licensing, and globalizing promising biopharmaceutical innovations to address unmet medical needs in cancer. This foundational approach has shaped its pipeline and operational focus, positioning the company as a clinical-stage entity heavily invested in research and development. Operating as a single Life Science segment, ArriVent's activities are currently concentrated on advancing its lead product candidate and expanding its therapeutic reach through strategic collaborations.

The cornerstone of ArriVent's pipeline is firmonertinib, a third-generation tyrosine kinase inhibitor (TKI) licensed from Shanghai Allist Pharmaceuticals Co. Ltd. (688578) in June 2021. This agreement granted ArriVent exclusive rights to develop and commercialize firmonertinib globally, excluding greater China. Firmonertinib is designed to target specific epidermal growth factor receptor (EGFR) mutations in non-small cell lung cancer (NSCLC), a prevalent and challenging disease. While other EGFR TKIs exist, firmonertinib is being developed with a particular focus on nonclassical, or uncommon, EGFR mutations, such as exon 20 insertions and PACC mutations, where current treatment options are limited and outcomes often suboptimal.

The potential technological advantage of firmonertinib lies in its observed activity in these specific uncommon mutations. Interim data from the Phase 1b FAVOUR trial in first-line patients with EGFR exon 20 insertion mutations showed a compelling 79% overall response rate (ORR) among 28 evaluable patients administered the 240 mg once daily dose. Similarly, interim proof-of-concept data from the FURTHER trial in first-line patients with PACC mutations demonstrated a 64% ORR among 22 evaluable patients. These figures, while from interim readouts, suggest a differentiated profile for firmonertinib in these niche, underserved patient populations compared to the efficacy typically seen with earlier generation EGFR TKIs in these specific mutations. This potential for improved response rates in difficult-to-treat subsets forms a key part of the investment thesis, suggesting firmonertinib could capture a meaningful share within these specific market segments if approved. The FDA's grant of Breakthrough Therapy Designation for firmonertinib in first-line NSCLC with EGFR exon 20 insertion mutations in October 2023 further underscores the potential clinical significance of these findings and may facilitate a more efficient development pathway.

Beyond firmonertinib, ArriVent is strategically expanding its pipeline, particularly in the burgeoning field of antibody-drug conjugates (ADCs). This diversification is evident in collaborations with Alphamab (9966) and Aarvik, focused on discovering and developing novel ADCs for oncology. A significant step in this direction was the exclusive license agreement with Lepu Biopharma Co., Ltd. (2157) in January 2025 for ARR-217.00, an ADC targeting CDH17 for gastrointestinal cancers. This agreement involved a $40 million upfront payment and potential future development, regulatory, and commercial milestones totaling up to approximately $1.17 billion. This move into ADCs targeting different cancer types signals ArriVent's ambition to build a broader oncology portfolio, leveraging external innovation to access new modalities and indications. The strategic rationale is clear: reduce reliance on a single asset and tap into the potential of ADCs, a class of therapeutics gaining significant traction in oncology.

Financial Performance and the Cost of Innovation

ArriVent's financial statements reflect its status as a clinical-stage company heavily investing in its pipeline. The company has not generated any product revenue to date, and its operations are characterized by significant research and development expenditures. For the three months ended March 31, 2025, total operating expenses surged to $66.8 million, a substantial increase from $20.7 million in the same period of 2024. This increase was primarily driven by a significant rise in research and development expenses, which totaled $61.3 million in Q1 2025 compared to $17.0 million in Q1 2024.

The most significant contributor to this increase was a $40.0 million one-time upfront payment related to the collaboration with Lepu for ARR-217. Beyond this, R&D costs for the lead candidate, firmonertinib, also increased, primarily due to higher expenditures on the pivotal Phase 3 FURVENT trial ($9.4 million in Q1 2025 vs $8.3 million in Q1 2024) and other general firmonertinib costs ($2.3 million vs $1.0 million), partially offset by a decrease in costs for the FURTHER trial. Personnel-related costs across R&D and general and administrative functions also increased due to higher headcount, contributing to the overall rise in expenses.

This elevated spending resulted in a net loss of $64.4 million for the three months ended March 31, 2025, compared to a net loss of $17.4 million for the same period in 2024. The cash used in operating activities for Q1 2025 was $68.0 million, reflecting the high level of R&D investment and the timing of vendor payments.

As of March 31, 2025, ArriVent held cash and cash equivalents and marketable securities totaling $205.5 million.