Zai Lab Limited announced that China’s National Medical Products Administration has approved its schizophrenia therapy COBENFY, a fixed‑dose combination of xanomeline and trospium chloride, for use in adults. The approval marks the first time a drug with a novel muscarinic mechanism—targeting M1 and M4 receptors—has been cleared in China, opening a new therapeutic avenue for the company’s traditionally oncology‑focused portfolio.
COBENFY’s approval follows a robust clinical development program that included a Phase 1 pharmacokinetics study in China, a Phase 3 China study (ZL‑2701‑001), and data from three global EMERGENT trials. The drug is designed to address unmet needs across positive, negative, and cognitive symptom domains of schizophrenia, potentially reducing reliance on dopamine‑blocking antipsychotics and their associated side‑effects such as weight gain, hyperprolactinemia, and extrapyramidal symptoms.
With the NMPA clearance, Zai Lab can commercialize COBENFY in mainland China, Hong Kong, Macau, and Taiwan. The launch expands the company’s product pipeline beyond oncology and immunology, positioning it to capture a sizable market of approximately 8 million adults with schizophrenia in China and to diversify revenue streams in the coming years. The approval follows the FDA’s September 2024 clearance of the same combination, underscoring regulatory confidence in the drug’s efficacy and safety profile.
Zai Lab’s Q3 2025 revenue of $116.1 million, a decline from the $150.5 million expected by analysts, reflected broader headwinds in its core oncology and immunology segments. The company’s full‑year 2024 revenue of $399.0 million and revised 2025 guidance of at least $460 million illustrate a strategic shift toward accelerating its global pipeline while managing short‑term revenue pressure. The COBENFY approval signals a new growth engine that could offset these headwinds and support the company’s long‑term revenue trajectory.
Management emphasized the significance of the approval. Dr. Samantha Du, founder, chairperson and CEO, said the company is “entering the next phase of our growth, powered by the rapid advancement of our global pipeline and supported by a commercially profitable and scalable business in China.” Dr. Rafael G. Amado, president and head of global R&D, added that COBENFY “has the potential to redefine how schizophrenia can be managed” and that the company is “looking forward to bringing this transformative therapy to patients as soon as possible.” Prof. Gang Wang, dean of Beijing Anding Hospital, noted that COBENFY “represents the first truly new therapeutic approach for schizophrenia in decades” and that it “has demonstrated comprehensive improvement across positive, negative and cognitive symptoms while avoiding many of the adverse effects commonly associated with traditional antipsychotics.”
Zai Lab holds an exclusive license from Karuna Therapeutics, Inc. (now part of Bristol Myers Squibb), to develop, manufacture and commercialize COBENFY in Greater China. The partnership provides the company with a proven platform and a clear pathway to market, reinforcing its strategic diversification into neuroscience and positioning it to capture a share of the growing schizophrenia treatment market in China.
The approval also underscores Zai Lab’s broader strategy to expand beyond oncology. While oncology, autoimmune, and infectious disease remain core focus areas, the addition of a neuroscience product aligns with the company’s goal of building a diversified pipeline that can generate multiple revenue streams and reduce concentration risk.
The market reaction to the approval has been positive, reflecting investor confidence in the company’s ability to translate a first‑in‑class therapy into commercial success. The approval is expected to enhance Zai Lab’s competitive positioning in China’s mental health market and to provide a new source of revenue that complements its existing oncology and immunology businesses.
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