UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-Q


☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~September 30, 2021~~March 31, 2022

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ___________ to _____________.

Commission file number 0-20713

CASI PHARMACEUTICALS, INC.

(Exact name of registrant as specified in its charter)


Delaware	58-1959440
(State or other jurisdiction of	(I.R.S. Employer Identification No.)
incorporation or organization)

9620 Medical Center Drive, Suite 300

Rockville, Maryland

(Address of principal executive offices)

20850

(Zip code)

(240) 864-2600

(Registrant’s telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of exchange on which registered
Common Stock	CASI	Nasdaq Capital Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

YES ⌧ NO ◻

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

YES ⌧ NO ◻

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer ◻	Accelerated filer ◻	Non-accelerated filer þ	Smaller reporting company ☑
			Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ◻

Indicate by checkmark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

YES ☐ NO ⌧

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the most recent practicable date.




Class		Outstanding at ~~November 8, 2021~~May 6, 2022
Common Stock $.01 Par Value		~~139,797,487~~136,062,495

Table of Contents

CASI PHARMACEUTICALS, INC.

Table of Contents


		PAGE
PART I. FINANCIAL INFORMATION		4

Item 1 --	Consolidated Financial Statements	4

Unaudited Condensed Consolidated Balance Sheets as of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020~~2021		4

Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss for the Three ~~and Nine~~ months ended ~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~		5

Unaudited Condensed Consolidated Statements of Stockholders’ Equity for the Three ~~and Nine~~ months ended ~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~		6

Unaudited Condensed Consolidated Statements of Cash Flows for the ~~Nine~~Three months ended ~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~		87

Notes to Unaudited Condensed Consolidated Financial Statements		98

Item 2 --	Management’s Discussion and Analysis of Financial Condition and Results of Operations	2720

Item 3 --	Quantitative and Qualitative Disclosures About Market Risk	3526

Item 4 --	Controls and Procedures	3526

Part II. OTHER INFORMATION		3626

Item 1 --	Legal Proceedings	3626

Item 1A --	Risk Factors	3626

Item 2 --	Unregistered Sales of Equity Securities and Use of Proceeds	3627

Item 3 --	Defaults Upon Senior Securities	3627

Item 4 --	Mine Safety Disclosures	3627

Item 5 --	Other Information	3627

Item 6 --	Exhibits	3728

SIGNATURES		3829

Table of Contents

TRADEMARKS AND SERVICE MARKS

We own or have rights to trademarks and trademark applications for use in connection with the operation of our business, including, but not limited to, CASI and CASI PHARMACEUTICALS. All other trademarks appearing in this Quarterly Report on Form 10-Q that are not identified as marks owned by us are the property of their respective owners.

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This report contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements also may be included in other statements that we make. All statements that are not descriptions of historical facts are forward-looking statements. These statements can generally be identified by the use of forward-looking terminology such as “believes,” “expects,” “intends,” “may,” “will,” “should,” or “anticipates” or similar terminology. These forward-looking statements include, among others, statements regarding the timing of our commercial launch of products, clinical trials, our cash position and future expenses, and our future revenues.

Forward-looking statements are subject to numerous assumptions, risks and uncertainties, which change over time. Forward-looking statements speak only as of the date they are made, and we assume no duty to update forward-looking statements. New factors emerge from time to time, and it is not possible for us to predict which factors will arise. In addition, we cannot assess the impact of each factor on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements.

Actual results could differ materially from those currently anticipated due to a number of factors, including: the risk that we may be unable to continue as a going concern as a result of our inability to raise sufficient capital for our operational needs; the possibility that we may be delisted from trading on The Nasdaq Capital Market if we fail to ~~meet~~satisfy applicable continued listing ~~standards;~~standards, including compliance with the Nasdaq bid price rule; the volatility in the market price of our common stock; the outbreak of the COVID-19 pandemic and its effects on global markets and supply chains; the risk of substantial dilution of existing stockholders in future stock issuances; the difficulty of executing our business strategy on a global basis including China; our inability to enter into strategic partnerships for the development, commercialization, manufacturing and distribution of our proposed product candidates or future candidates; legal or regulatory developments in China that adversely affect our ability to operate in ~~China,~~China; our lack of experience in manufacturing products and uncertainty about our resources and capabilities to do so on a clinical or commercial scale; risks relating to the commercialization, if any, of our products and proposed products (such as marketing, safety, regulatory, patent, product liability, supply, competition and other risks); our inability to predict when or if our product candidates will be approved for marketing by the U.S. Food and Drug Administration (FDA), European Medicines Agency (EMA), National Medical Products Administration (NMPA), or other regulatory authorities; our inability to enter into strategic partnerships for the development, commercialization, manufacturing and distribution of our proposed product candidates or future candidates; the risks relating to the need for additional capital and the uncertainty of securing additional funding on favorable terms; the risks associated with our product candidates, and the risks associated with our other early-stage products under development; the risk that result in preclinical and clinical models are not necessarily indicative of clinical results; uncertainties relating to preclinical and clinical trials, including delays to the commencement of such trials; our ability to protect our intellectual property rights; our ability to design and implement a development plan for our ANDAs held by CASI Wuxi; the lack of success in the clinical development of any of our products; and our dependence on third parties; the risks related to our dependence on Juventas to conduct the clinical development of CNCT19 and to partner with us to co-market CNCT19; risks related to our dependence on Juventas to ensure the patent protection and prosecution for CNCT19; risks relating to the commercialization, if any, of our proposed products (such as marketing, safety, regulatory, patent, product liability, supply, competition and other risks); risks relating to interests of our largest stockholders and our Chairman and CEO that differ from our other stockholders; and risks related to the development of a new manufacturing facility by CASI Wuxi. Such factors, among others, could have a material adverse effect upon our business, results of operations and financial ~~condition.~~condition..

We caution ~~readers~~investors that actual results or business conditions may differ materially from those projected or suggested in forward-looking statements as a result of various factors including, but not limited to, those described above and in Section IA, “Risk Factors” of our Annual Report on Form 10-K for the fiscal year ended December 31, 2021 and our other filings with the Securities and Exchange Commission (“SEC”). We cannot assure you that we have identified all the factors that create uncertainties. Moreover, new risks emerge from time to time and it is not possible for our management to predict all risks, nor can we assess the impact of all risks on our business or the extent to which any risk, or combination of risks, may cause actual results to differ from those contained in any forward-looking statements. Readers should not place undue reliance on ~~any~~ forward-looking statements, which only ~~speak~~relate to events or information as of the date made. We undertake no obligation to publicly release the result of any revision of these forward-looking statements to reflect events or circumstances after the date they are made or to reflect the occurrence of unanticipated events. Additional information about the factors and risks that could affect our business, financial condition and results of operations, are contained in our filings with the ~~SEC, including, but not limited to, our Annual Reports on Form 10-K, our Quarterly Reports on Form 10-Q~~U.S. Securities and ~~our Current Reports on Form 8-K, each of~~Exchange Commission (“SEC”), which isare available at www.sec.gov.

Table of Contents

PART I. FINANCIAL INFORMATION

ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS

CASI Pharmaceuticals, Inc.

Unaudited Condensed Consolidated Balance Sheets

(In thousands, except share and per share data)



	September 30, 2021		December 31, 2020		March 31, 2022		December 31, 2021
ASSETS
Current assets:
Cash and cash equivalents	$	53,126	$	57,064	$	29,259	$	38,704
Investment in equity securities, at fair value		9,503		9,309		8,225		9,868
Accounts receivable, net of $0 allowance for doubtful accounts		5,418		4,645		10,086		9,803
Inventories		1,727		1,356		3,721		1,907
Prepaid expenses and other		2,190		1,651		1,404		1,688
Total current assets		71,964		74,025		52,695		61,970

Property, plant and equipment, net		6,778		2,062		14,580		12,712
Intangible assets, net		12,358		13,210		11,900		12,203
Long-term investments		34,177		29,442		40,320		40,128
Right of use assets		9,499		8,696		8,809		9,107
Other assets		1,498		299		1,260		2,178
Total assets	$	136,274	$	127,734	$	129,564	$	138,298

LIABILITIES, REDEEMABLE NONCONTROLLING INTEREST AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	6,324	$	3,669	$	7,171	$	4,789
Accrued and other current liabilities		2,550		3,015		6,701		8,397
Bank borrowings		1,084		826
Notes payable		—		466
Total current liabilities		9,958		7,976		13,872		13,186

Deferred income		2,342		2,351		2,821		2,828
Other liabilities		14,460		13,834		14,156		14,325
Total liabilities		26,760		24,161		30,849		30,339

Commitments and contingencies (Note 19)
Commitments and contingencies

Redeemable noncontrolling interest, at redemption value (Note 11)		22,907		22,033
Redeemable noncontrolling interest, at redemption value						23,726		23,457

Stockholders’ equity:
Preferred stock, $1.00 par value: 5,000,000 shares authorized and 0 shares issued and		0		0		0		0
outstanding
Common stock, $0.01 par value:
250,000,000 shares authorized at September 30, 2021 and December 31, 2020
139,877,032 shares and 124,023,374 shares issued at September 30, 2021 and December 31, 2020, respectively;
139,797,487 shares and 123,943,829 shares outstanding at September 30, 2021 and December 31, 2020, respectively		1,399		1,240
250,000,000 shares authorized at March 31, 2022 and December 31, 2021
137,335,787 shares and 139,877,032 shares issued at March 31, 2022 and December 31, 2021, respectively;
136,062,495 shares and 139,797,487 shares outstanding at March 31, 2022 and December 31, 2021, respectively						1,374		1,399
Additional paid-in capital		692,041		658,246		694,180		694,826
Treasury stock, at cost: 79,545 shares held at September 30, 2021 and December 31, 2020		(8,034)		(8,034)
Treasury stock, at cost: 1,273,292 shares and 79,545 shares held at March 31, 2022 and December 31, 2021						(9,068)		(8,034)
Accumulated other comprehensive income		1,169		589		2,129		1,954
Accumulated deficit		(599,968)		(570,501)		(613,626)		(605,643)
Total stockholders’ equity		86,607		81,540		74,989		84,502
Total liabilities, redeemable noncontrolling interest and stockholders' equity	$	136,274	$	127,734	$	129,564	$	138,298

~~See~~The accompanying ~~condensed notes.~~notes are an integral part of these consolidated financial statements.

Table of Contents

CASI Pharmaceuticals, Inc.

Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss

(In thousands, except share and per share data)


	Three Months Ended September 30					Nine Months Ended September 30				Three Months Ended March 31
	2021		2020			2021		2020		2022		2021
Revenues:
Product sales	$	8,075	$	4,205		$	20,900	$	10,215	$	9,025	$	5,700
Lease income		37		37			110		104
Lease income from a related party											37		36
Total revenues		8,112		4,242			21,010		10,319		9,062		5,736

Costs of revenues:
Cost of goods sold		1,831		1,012			4,625		5,549		1,977		1,237
Royalty fee		1,586		816			4,132		2,007		1,781		1,121
Total costs of revenues		3,417		1,828			8,757		7,556		3,758		2,358

Gross Profit											5,304		3,378

Operating expenses:
Research and development		2,895		2,803			10,408		7,682		3,992		5,258
General and administrative		5,259		5,347			16,184		13,490		5,325		5,502
Selling and marketing		3,433		2,062			9,508		4,879		3,277		2,715
Loss on disposal of property, plant, equipment		—		—			65		—
Gain on disposal of intangible assets		0		0			0		(450)
Impairment of intangible assets		—		—			—		1,537
Acquired in-process research and development		0		10,862			6,555		11,943		0		5,500
Total operating expenses		11,587		21,074			42,720		39,081		12,594		18,975

Loss from operations		(6,892)		(18,660)			(30,467)		(36,318)		(7,290)		(15,597)
Non-operating income/(expense):

Non-operating income (expense):
Interest income, net		79		432			261		775		74		106
Other income		487		20			540		47		38		20
Foreign exchange gains (losses)		(6)		(526)			289		(278)
Foreign exchange gain											333		219
Change in fair value of investments		(3,687)		1,978			(205)		2,287		(1,555)		1,568
Impairment loss of long-term investments		—		—			(865)		—
Loss before income tax expense											(8,400)		(13,684)
Income tax expense											—		—
Net loss		(10,019)		(16,756)			(30,447)		(33,487)		(8,400)		(13,684)
Less: loss attributable to redeemable noncontrolling interest		(314)		(309)			(980)		(584)		(417)		(349)
Accretion to redeemable noncontrolling interest redemption value		519		506			1,586		1,185		613		548
Net loss attributable to CASI Pharmaceuticals, Inc.	$	(10,224)	$	(16,953)		$	(31,053)	$	(34,088)	$	(8,596)	$	(13,883)
					��
Net loss per share (basic and diluted)	$	(0.07)	$	(0.14)		$	(0.23)	$	(0.32)	$	(0.06)	$	(0.11)
Weighted average number of common shares outstanding (basic and diluted)		139,797,487		117,940,405			134,861,366		105,922,281
Weighted average number of common stock outstanding (basic and diluted)											137,955,910		124,824,588

Comprehensive loss:
Net loss	$	(10,019)	$	(16,756)		$	(30,447)	$	(33,487)	$	(8,400)	$	(13,684)
Foreign currency translation adjustment		15		2,383			848		1,221		248		(172)
Total comprehensive loss	$	(10,004)	$	(14,373)		$	(29,599)	$	(32,266)	$	(8,152)	$	(13,856)
Less: Comprehensive loss attributable to redeemable noncontrolling interest		(309)		(309)			(712)		(584)		(344)		(417)
Comprehensive loss attributable to common stockholders	$	(9,695)	$	(14,064)		$	(28,887)	$	(31,682)	$	(7,808)	$	(13,439)

~~See~~The accompanying ~~condensed notes.~~notes are an integral part of these consolidated financial statements.

Table of Contents

CASI Pharmaceuticals, Inc.

Unaudited Condensed Consolidated Statements of Stockholders’ Equity

(In thousands, except share data)


													Accumulated
									Additional				Other
	Preferred Stock				Common Stock				Paid-in		Treasury		Comprehensive		Accumulated
	Shares		Amount		Shares		Amount		Capital		Stock		Income /(Loss)		Deficit		Total
Balance at December 31, 2021		0	$	0		139,797,487	$	1,399	$	694,826	$	(8,034)	$	1,954	$	(605,643)	$	84,502
Repurchase and retirement of common stock		—		—		(3,734,992)		(25)		(1,941)		(1,034)						(3,000)
Stock-based compensation expense, net of forfeitures		0		0		0		0		1,908		0		0		0		1,908
Foreign currency translation adjustment		0		0		0		0		0		0		175		0		175
Net loss attributable to CASI Pharmaceuticals, Inc.		0		0		0		0		(613)		0		0		(7,983)		(8,596)
Balance at March 31, 2022		0	$	0		136,062,495	$	1,374	$	694,180	$	(9,068)	$	2,129	$	(613,626)	$	74,989


													Accumulated																		Accumulated
									Additional				Other														Additional				Other
	Preferred Stock				Common Stock				Paid-in		Treasury		Comprehensive		Accumulated				Preferred Stock				Common Stock				Paid-in		Treasury		Comprehensive		Accumulated
	Shares		Amount		Shares		Amount		Capital		Stock		Loss		Deficit		Total		Shares		Amount		Shares		Amount		Capital		Stock		Loss		Deficit		Total
Balance at December 31, 2020		0	$	0		123,943,829	$	1,240	$	658,246	$	(8,034)	$	589	$	(570,501)	$	81,540		0	$	0		123,943,829	$	1,240	$	658,246	$	(8,034)	$	589	$	(570,501)	$	81,540
Issuance of common stock pursuant to financing agreements		—		—		15,853,658		159		32,341		0		0		0		32,500		—		—		15,853,658		159		32,341		—		—		—		32,500
Stock issuance costs		—		—		—		—		(2,019)		0		0		0		(2,019)		0		0		0		0		(2,019)		0		0		0		(2,019)
Stock-based compensation expense, net of forfeitures		0		0		0		0		5,059		0		0		0		5,059		0		0		0		0		1,998		0		0		0		1,998
Foreign currency translation adjustment		0		0		0		0		0		0		580		0		580		0		0		0		0		0		0		(104)		0		(104)
Net loss attributable to CASI Pharmaceuticals, Inc.		0		0		0		0		(1,586)		0		0		(29,467)		(31,053)		0		0		0		0		(548)		0		0		(13,335)		(13,883)
Balance at September 30, 2021		0	$	0		139,797,487	$	1,399	$	692,041	$	(8,034)	$	1,169	$	(599,968)	$	86,607
Balance at March 31, 2021																				0	$	0		139,797,487	$	1,399	$	690,018	$	(8,034)	$	485	$	(583,836)	$	100,032

The accompanying notes are an integral part of these consolidated financial statements.

~~Table of Contents~~

Accumulated

Additional

Other

Preferred Stock

Common Stock

Paid-in

Treasury

Comprehensive

Accumulated

Shares

Amount

Shares

Amount

Capital

Stock

Loss

Deficit

Total
Balance at June 30, 2020

—

$
—


100,928,829

$
1,010

$
614,617

$
(8,034)

$
(3,890)

$
(540,364)

$
63,339
Issuance of common stock for options exercised

—

—

15,000

—

22

—

—

—

22
Issuance of common stock pursuant to financing agreements

—

—

23,000,000

230

43,470

—

—

—

43,700
Stock issuance costs

—

—

—

—

(2,757)

—

—

—

(2,757)
Stock-based compensation expense, net of forfeitures

—

—

—

—

1,793

—

—

—

1,793
Foreign currency translation adjustment

—

—

—

—

—

—

2,383

—

2,383
Net loss attributable to CASI Pharmaceuticals, Inc.

—

—

—

—

(506)

—

—

(16,447)

(16,953)
Balance at September 30, 2020

—

$
—

123,943,829

$
1,240

$
656,639

$
(8,034)

$
(1,507)

$
(556,811)

$
91,527

Accumulated

Additional

Other

Preferred Stock

Common Stock

Paid-in

Treasury

Comprehensive

Accumulated

Shares

Amount

Shares

Amount

Capital

Stock

Loss

Deficit

Total
Balance at December 31, 2019

0

$
0

97,771,698

$
979

$
606,686

(8,034)

$
(2,728)

$
(523,908)

$
72,995
Issuance of common stock for options and warrants exercised

—

—

2,737,795

27

3,847

—

—

—

3,874
Repurchase of stock options to satisfy tax withholding obligations

0

0

0

0

(251)

0

0

0

(251)
Issuance of common stock pursuant to financing agreements

—

—

23,434,336

234

44,865

—

—

—

45,099
Stock issuance costs

0

0

0

0

(3,008)

0

0

0

(3,008)
Stock-based compensation expense, net of forfeitures

0

0

0

0

5,685

0

0

0

5,685
Foreign currency translation adjustment

0

0

0

0

0

0

1,221

0

1,221
Net loss attributable to CASI Pharmaceuticals, Inc.

0

0

0

0

(1,185)

0

0

(32,903)

(34,088)
Balance at September 30, 2020

0

$
0

123,943,829

$
1,240

$
656,639

$
(8,034)

$
(1,507)

$
(556,811)

$
91,527

~~See accompanying condensed notes.~~

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CASI Pharmaceuticals, Inc.

Unaudited Condensed Consolidated Statements of Cash Flows

(In thousands)


	Nine Months Ended				Three Months Ended

	September 30, 2021		September 30, 2020		March 31, 2022		March 31, 2021
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss	$	(30,447)		(33,487)	$	(8,400)		(13,684)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation for property, plant and equipment		393		389		92		179
Loss on disposal of property, plant and equipment		65		—
Amortization of intangible assets		1,009		1,095		341		337
Reduction in the carrying amount of the right-of-use assets		1,031		973		308		348
Gain on disposal of intangible assets		—		(450)
Impairment of intangible assets		—		1,537
Stock-based compensation expense		5,059		5,685		1,908		1,998
Acquired in-process research and development		6,555		11,943		—		5,500
Government grant as a result of loan forgiveness		(472)		—
Change in fair value of investments		205		(2,287)		1,555		(1,568)
Impairment loss of long-term investments		865		—
Changes in operating assets and liabilities:
Accounts receivable		(773)		(2,785)		(283)		(1,193)
Inventories		(371)		3,822		(1,814)		(1,638)
Prepaid expenses and other assets		(539)		(434)		1,231		637
Accounts payable		26		(2,434)		2,378		2,073
Accrued liabilities and other liabilities		(1,770)		(1,398)
Accrued and other current liabilities and other liabilities						(1,539)		(978)
Deferred income		(37)		(23)		(15)		(12)
Net cash used in operating activities		(19,201)		(17,854)		(4,238)		(8,001)

CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from disposal of intangible assets		—		1,700
Proceeds from disposal of property and equipment		10		—
Purchases of property, plant and equipment		(3,730)		(367)		(2,288)		(981)
Loan to a related party		—		(10,033)
Receipt of repayment of loan from a related party		—		10,033
Cash paid to acquire in-process research and development		(6,555)		(11,678)		—		(5,500)
Cash paid to acquire convertible loan in Black Belt Tx Limited		(86)		(83)		—		(86)
Receipt of repayment of Black Belt convertible note		172		—
Cash paid to acquire convertible loan in Alesta Tx		(261)		—
Cash paid to acquire convertible loan in Cleave		(5,500)		—		—		(5,500)
Receipt of government grants related to land use right		—		2,278
Net cash used in investing activities		(15,950)		(8,150)		(2,288)		(12,067)

CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from notes payable		—		466
Proceeds from bank borrowings		709		—		—		709
Repayment of bank borrowings		(463)		—
Repurchase of common stock						(3,000)		—
Stock issuance costs		(2,019)		(2,800)		—		(2,019)
Proceeds from sale of common stock		32,500		45,099		0		32,500
Proceeds from exercise of stock options		—		3,874
Repurchase of stock options to satisfy tax withholding obligations		—		(251)
Net cash provided by financing activities		30,727		46,388
Net cash (used in) provided by financing activities						(3,000)		31,190

Effect of exchange rate change on cash and cash equivalents		486		587		81		(69)
Net increase (decrease) in cash and cash equivalents		(3,938)		20,971
Net (decrease)/ increase in cash and cash equivalents						(9,445)		11,053

Cash and cash equivalents at beginning of period		57,064		53,621		38,704		57,064
Cash and cash equivalents at end of period	$	53,126	$	74,592	$	29,259	$	68,117

Supplemental disclosure of cash flow information:
Interest paid	$	0	$	0
Income taxes paid	$	0	$	0

Non-cash investing activities:
Purchases of property, plant and equipment in accounts payable	$	2,680	$	—
Non-cash investing and financing activities:
Purchases of property, plant and equipment in accrued and other current liabilities					$	2,954	$	38

~~See~~

The accompanying ~~condensed notes.~~notes are an integral part of these consolidated financial statementss.

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CASI Pharmaceuticals, Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

1. ~~Basis of Presentation, Organization and Principal Activities~~

~~Basis of Presentation~~DESCRIPTION OF BUSINESS

CASI Pharmaceuticals, Inc. (“CASI” or the “Company”) (Nasdaq: CASI) is a U.S. biopharmaceutical company focused on developing and commercializing innovative therapeutics and pharmaceutical products in China, the United States, and throughout the world. The Company was 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.” The majority of the Company’s operations are now located in China. The Company is focused on acquiring, developing and commercializing products that augment its hematology/oncology therapeutic focus as well as other areas of unmet medical need. The Company is executing its plan to become a biopharmaceutical leader by launching medicines in the greater China market leveraging its China-based regulatory, clinical and commercial competencies and its global drug development expertise.

The ~~accompanying unaudited condensed consolidated financial statements include the accounts of the~~ Company ~~and~~launched its ~~subsidiaries,~~first commercial product, EVOMELA^® (Melphalan for Injection) in which CASI, directly or indirectly, has a controlling financial interest. These subsidiaries include Miikana Therapeutics, Inc. (“Miikana”), CASI Pharmaceuticals (China) Co., Ltd. (“CASI China”), CASI Pharmaceuticals (Wuxi) Co., Ltd. (“CASI Wuxi”), CASI Biopharmaceuticals (WUXI) Co., Ltd. (“CASI Biopharmaceuticals”), and CASI Pharmaceuticals (Hainan) Co., Ltd. (“CASI Hainan”). CASI China ~~is a non-stock Chinese entity with 100% of its interest owned by CASI. CASI China received approval for a business license from the Beijing Industry and Commercial Administration~~ in August ~~2012~~2019. In China, EVOMELA^® is approved for use as a conditioning treatment prior to stem cell transplantation and ~~has operating facilities in Beijing. CASI Hainan is~~as a ~~wholly owned subsidiary of CASI China and was established in June 2021. CASI Biopharmaceuticals is a wholly owned subsidiary of CASI Wuxi and was established in April 2019.~~palliative treatment for patients with multiple myeloma. The ~~Company controls CASI Wuxi through 80% voting rights (see Note 11). Accordingly, the financial statements of CASI Wuxi have been consolidated~~other core hematology/oncology assets in the Company’s ~~consolidated financial statements since its inception. All inter-company balances~~pipeline include CNCT 19, an autologous CD19 CAR-T investigative product (“CNCT19”); BI-1206, an antibody which has a novel mode-of-action, blocking the inhibitory antibody checkpoint receptor FcγRIIB to unlock anti-cancer immunity and ~~transactions have been eliminated~~enhance the efficacy of antibody-based immunotherapy in ~~consolidation. The Company currently operates~~both hematological malignancies and solid tumors; CB-5339, a novel VCP/p97 inhibitor focused on valosin-containing protein (VCP)/p97 as a novel target in ~~1 operating segment, which is the development of innovative therapeutics addressing cancer~~protein homeostasis, DNA damage response and other ~~unmet medical needs~~cellular stress pathways for ~~the global market.~~

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles for interim financial information and in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, such condensed consolidated financial statements do not include all of the information and disclosures required by U.S. generally accepted accounting principles for complete consolidated financial statements. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included. The accompanying December 31, 2020 financial information was derived from the Company’s audited financial statements includedtherapeutic use in the ~~Company’s Annual Report on Form 10-K for the year ended December 31, 2020. The accompanying unaudited condensed consolidated financial statements should be read~~treatment of patients with various malignancies; and CID-103, a full human IgG1 anti-CD38 monoclonal antibody recognizing a unique epitope that has demonstrated encouraging preclinical efficacy and safety profile compared to other anti-CD38 monoclonal antibodies.

Liquidity and Capital Resources

Since its inception in conjunction with the consolidated balance sheet of the Company as of December 31, 2020 and the related consolidated statements of operations and comprehensive loss, stockholders’ equity and cash flows for the year ended December 31, 2020.

~~Liquidity Risks and Management’s Plans~~

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 majority of the Company’s operations are now located in China. The Company expects to continue to incur operating losses for the foreseeable future due to, among other factors, its continuing clinical and development activities and expansion of the Company’s operations. The Company’s Beijing office is primarily responsible for the Company’s day-to-day operations and the Company’s 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 the Company’s future clinical and commercial distribution and manufacturing needs, to manage the Company’s supply chain for certain products, and to develop a GMP manufacturing facility in China.

~~The Company has primarily funded its operations through the proceeds from the sales of common stock. To date,~~1991, the Company has ~~product revenue~~incurred significant losses from operations and, ~~management expects operating losses to continue for the foreseeable future.~~

On October 29, 2021, the Company has entered into a common stock sales agreement (“stock sales agreement ”), with H.C. Wainwright & Co., LLC (“Wainwright”), relating to shares of common stock of the Company, $0.01 par value per share. In accordance

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~~with the terms of the sales agreement, the Company may offer and sell shares of common stock having an aggregate offering price of not more than $20,000,000.~~

~~Taking into consideration the cash and cash equivalents balance~~ as of ~~September 30, 2021, the~~March 31, 2022, has incurred an accumulated deficit of $613.6 million.

The Company believes that it has sufficient resources to fund its operations at least one year beyond the date that the ~~unaudited condensed~~interim consolidated financial statements are issued. As of ~~September 30, 2021,~~March 31, 2022, the Company had a ~~consolidated cash~~ balance of ~~$53.1 million.~~cash and cash equivalents of $29.3 million, of which $19.1 million was held in the financial institutions in the PRC. The Company intends to continue to exercise tight controls over operating expenditures and will continue to pursue opportunities, as required, to raise additional capital and will also actively pursue non- or less-dilutive capital raising ~~arrangements.~~arrangements or opportunities.

Risks and Uncertainties

The Company has experienced operational interruptions as a result of COVID-19, including the temporary disruption of operations in China during 2020 due to a Chinese government mandated quarantine protocol, including mandatory business closures, social distancing measures, and various travel restrictions. In the first quarter 2020, during whichDuring the peak of the COVID-19 pandemic ~~occurred~~ in ~~China,~~2020, the Company experienced ~~some~~ disruptions to ~~its~~the EVOMELA^® marketing and sales activities as well as to the supply chain for EVOMELA^®. The COVID-19 pandemic also impacted the targeted start time of its CID-103 trial due to ~~travel restrictions~~the lock down of many medical facilities in Europe. During 2021 and the ~~prioritization~~first quarter of ~~hospitals~~2022, the Company has experienced minimal disruption to its business activities or supply chain as a result of the COVID-19 pandemic. However, since the second quarter of 2022, the COVID-19 related lock down and ~~physicians to attend to patients with COVID-19 infection. Although the Company's operations~~associated restrictions in certain areas in China ~~have normalized, there can be no assurance that such operations will continue~~led to ~~do so.~~

To the ~~extent that such events occur, demand for~~shutdown of local hospitals, which had a negative impact on the ~~Company's products may decline, and the Chinese government or other governments may impose additional restrictions resulting in further shutdowns, further work restrictions, and the disruption~~sales of the Company’s ~~supply~~products for the second quarter, and ~~distribution channels; there can be no assurance~~is expected to have negative impacts on the same for the whole year. The restrictions also adversely impacted the enrolling of patients for the CNCT19 Phase II studies. Given that such ~~restrictions will not be imposed again.~~restriction measurement is beyond the Company’s control, it is unable to, at this stage, assess for how long such measurement may continue and the full extent to which such measurement may directly and indirectly impact the Company’s business operations

The Company currently relies on a single source for ~~its~~the supply of EVOMELA^®. IfThe continuation of the COVID-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, its ability to continue to commercialize and expand distribution of EVOMELA^® could be adversely affected if the supplier refuses or is unable to provide products for any reason (including the occurrence of an event like the COVID-19 pandemic that makes delivery ~~impractical), the~~impractical. The Company would ~~be required~~have to work with

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Acrotech to negotiate an agreement with a substitute supplier, ~~and obtain regulatory approval for the manufacturing change,~~ which, assuming a substitute supplier was available, would likely interrupt the manufacturing of EVOMELA^®, cause supply chain delays and increase costs.

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 the ~~Company's~~Company’s ability to continue to commercialize and expand distribution of EVOMELA^® (Melphalan For Injection) or other drugs in ~~the Company’s~~its existing product pipeline. ~~The effectiveness~~Early in the COVID-19 pandemic, the Company experienced a disruption to its supply chain for EVOMELA^®, it has experienced no supply disruption in 2021 and the first quarter of ~~the Company's sales teams may~~2022; however, there can be ~~negatively impacted by the lack of travel and their reduced ability to engage with decision-makers.~~no assurance that restrictions will not be imposed again. In addition, economic and other uncertainties may adversely affect other ~~parties'~~parties’ willingness to negotiate and execute product licenses and thus hamper ~~the Company's~~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. The COVID-19 pandemic has also impacted the Company's targeted start time of its 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 the Company's 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 the Company's product candidates. Any prolongation or de-prioritization of the Company's clinical trials or delay in regulatory review resulting from such disruptions could materially affect the development and approval of the Company's product candidates.

2. License and Distribution Agreements

Acrotech License Arrangements

The Company has product rights and perpetual exclusive licenses from Acrotech Biopharma L.L.C. (“Acrotech”) to develop and commercialize its commercial product ~~EVOMELA®~~EVOMELA^® (Melphalan Hydrochloride For Injection) in the greater China region (which includes Mainland China, Taiwan, Hong Kong and Macau), as well as similar rights to assets ~~ZEVALIN®~~ZEVALIN^® (Ibritumomab Tiuxetan) and ~~MARQIBO®~~MARQIBO^® (Vincristine Sulfate Liposome Injection). The exclusive licenses held by the Company were originally licensed from

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Spectrum Pharmaceuticals, ~~which they later transferred~~and Spectrum completed the sale of its portfolio of FDA-approved hematology/oncology products including EVOMELA^® to ~~Acrotech.~~Acrotech on March 1, 2019. On December 3, 2018, the Company received NMPA’s approval for importation, marketing and sales in China and in August 2019 the Company launched ~~EVOMELA®~~commercial sales EVOMELA^® in China. The NMPA required EVOMELA^®post-marketing study has been completed and the clinical study report is ~~ongoing.~~

~~The Company is currently evaluating future development options~~being finalized for ~~ZEVALIN®~~regulatory submission. Based on the FDA withdrawal of the approved US indication for MARQIBO® (Vincristine Sulfate Liposome Injection) in May 2022, the product rights and perpetual exclusive licenses to develop and commercialize MARQIBO® ~~due~~in the greater China region have been returned to ~~the evolving standard of care environment, the rare and niche indications for these products, potential US regulatory action and its commitment to prioritize resources.~~Acrotech.

China Resources ~~Guokang Pharmaceuticals~~Pharmaceutical Commercial Group International Trading Co., ~~Ltd~~Ltd.

In March 2019, the Company entered into a three-year exclusive distribution agreement with China Resources ~~Guokang Pharmaceuticals~~Pharmaceutical Commercial Group International Trading Co., ~~Ltd~~Ltd. (“~~CRGK”~~CRPCGIT”) to appoint ~~CRGK~~CRPCGIT on an exclusive basis as its distributor to distribute EVOMELA^®in the territory of the People’s Republic of China (excluding Hong Kong, Taiwan and Macau), subject to certain terms and conditions. The Company’s internal marketing and sales team are responsible for commercial activities, including, for example, direct interaction with Key Opinion Leaders (KOL), physicians, hospital centers and the generating of sales. ~~Commercial sales of EVOMELA~~^® ~~were launched~~The agreement was renewed in August 2019. For the three months ended September 30, 2021 and 2020, the Company recognized $8.1 million and $4.2 million of revenues from sales of EVOMELA® under this arrangement. For the nine months ended September 30, 2021 and 2020, the Company recognized $20.9 million and $10.2 million of revenues from sales of EVOMELA^® ~~under this arrangement.~~March 2022 for another two years.

Juventas Cell Therapy (“Juventas”)

In June 2019, the Company entered into a license agreement for exclusive worldwide license to commercialize an autologous anti-CD19 T-cell therapy product (CNCT19) from Juventas ~~Cell Therapy Ltd. (“Juventas”)~~ (the “Juventas license agreement”). Juventas is a China-based company engaged in cell therapy. The terms of the agreement include RMB 70 million ($10 million) of milestone payments upon the registration of Phase II clinical trial of CNCT19 and sales royalty payments. The milestone was met during the quarter ended September 30, 2020. As a result, the Company paid the milestone payment of RMB 70 million to Juventas in September 2020, which was expensed as acquired in-process research and development in the consolidated statement of operations and comprehensive loss for the year ended December 31, 2020.

In September 2020, Juventas and its shareholders (including CASI Biopharmaceuticals) agreed to certain terms and conditions required by a new third-party investor to facilitate the Series B financing of Juventas, pursuant to which the Company agreed to amend and supplement the original licensing agreement (the "Supplementary Agreement") by agreeing to pay Juventas certain percentage of net profits generated from commercial sales of ~~CNCT19.~~CNCT19 in addition to the royalty fee payment calculated as a percentage of net sales. The Supplementary Agreement also specifies a minimum annual target net profit to be distributed to Juventas and certain other terms and obligations. In return, the Company obtained additional equity interests in ~~Juventas (see Note 4).~~Juventas.

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Under the Supplementary Agreement, Juventas and the Company will jointly market CNCT19, including, but not limited to, establishing medical teams, developing medical strategies, conducting post-marketing clinical studies, establishing Standardized Cell Therapy Centers, establishing and training providers with respect to cell therapy, testing for cell therapy, and monitoring quality controls (cell collection and transfusion, etc.), and patient management (adverse reactions treatment, patients’ follow-up visits, and establishment of a database). The Company also will reimburse Juventas for a portion of Juventas’ marketing expenses as reviewed and approved by a joint commercial committee to be constituted. The Company will continue to be responsible for recruiting and establishing a sales team to commercialize CNCT19.

BioInvent International AB

In October 2020, the Company entered into an exclusive licensing agreement with BioInvent International AB (“BioInvent”) for the development and commercialization of novel anti-FcγRIIB antibody, BI-1206, in mainland China, Taiwan, Hong Kong and Macau. BioInvent is a biotechnology company focused on the discovery and development of first-in-class immune-modulatory antibodies for cancer immunotherapy. BI-1206 is ~~BioInvent’s lead drug candidate and is~~ being investigated in a Phase 1/2 trial, in combination with anti-PD1 therapy Keytruda^® (pembrolizumab), in patients with solid tumors, and in a Phase 1/2a trial in combination with MabThera^® (rituximab) in patients with relapsed/refractory non-Hodgkin lymphoma (NHL). The CASI Clinical Trial Application (CTA) was approved by China National Medical Products Administration (NMPA) in December 2021 and ethics committee approvals have been received in January of 2022. The Company obtained approval from Human Genetic Resources Administration of China (“HGRAC”) in April 2022. The Company is planning a Phase 1 study of BI-1206 in combination with rituximab with a single agent BI-1206 run in phase in patients with NHL (mantle cell lymphoma, marginal zone lymphoma, and follicular lymphoma) to assess PK, safety and tolerability, select the Recommended Phase 2 Dose and assess early signs of clinical efficacy as part of its development program for BI-1206 in China. The study is expected to start in the second quarter of 2022 with the first-patient-in in the third quarter of 2022.

Under the terms of the agreement, BioInvent and CASI will develop BI-1206 in both hematological malignancies and solid tumors, with CASI responsible for commercialization in China and associated markets. CASI made a $5.9 million upfront payment in November 2020 to BioInvent and will pay up to $83 million in development and commercial milestone payments plus tiered royalties in the high-single to mid-double-digit range on net sales of BI-1206. Because BI-1206 underlying the acquired rights has not reached

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technological feasibility and has no alternative future uses, the Company expensed $5.9 million as acquired in-process research and development in ~~the fourth quarter of~~ 2020.

Black Belt Therapeutics Limited

In April 2019, the Company entered into a license agreement with Black Belt Therapeutics Limited (“Black Belt”) for exclusive worldwide rights to CID-103, an investigational anti-CD38 monoclonal antibody (Mab) (formerly known as TSK011010). The Company expects that its clinical materials and commercial inventory will be supplied by one or more contract manufacturers with whom the Company has contracted with. Under the terms of the agreement, CASI obtained global rights to CID-103 for an upfront payment of 5 million euros ($5.7 million) ~~as well as~~and would pay up to $46.3 million in development milestone payments and certain ~~milestone and royalty payments.~~royalties based on sales milestones. In June 2021, the Company achieved the First-Patient-In (FPI) in the Phase 1 dose escalation and expansion study of CID-103, and made $750,000 milestone payment in June 2021 and €250,000 ($~~298,000)~~305,000) payment in August 2021 under the terms of the agreement. Because CID-103 underlying the acquired rights has not yet reached technological feasibility and has no alternative uses, the Company expensed 5 million euros ~~as acquired in-process research~~ and ~~development in the consolidated statement of operations and comprehensive loss for the year ended December 31, 2019, and $1.06~~$1.1 million as acquired in-process research and development, respectively, in ~~the unaudited consolidated statements of operations~~2019 and ~~comprehensive loss for the nine months ended September 30,~~ 2021.

Cleave Therapeutics, Inc.

In March 2021, the Company entered into an exclusive license with Cleave Therapeutics, Inc. (“Cleave”) for the development and commercialization of CB-5339, an oral novel VCP/p97 inhibitor, in both hematological malignancies and solid tumors, in Mainland China, Hong Kong, Macau and Taiwan. Cleave is a clinical-stage biopharmaceutical company focused on valosin-containing protein (VCP)/p97 as a novel target in protein homeostasis, DNA damage response and other cellular stress pathways for therapeutic use in the treatment of patients with cancer. Cleave and the Company will develop CB-5339 in both hematological malignancies and solid tumors, with CASI responsible for development and commercialization in China and associated markets. The Company paid a $5.5 million upfront payment to Cleave and will pay up to $74 million in development and commercial milestone payments plus tiered royalties in the high-single to mid-double-digit range on net sales of CB-5339.

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CB-5339 is being evaluated by Cleave in a Phase 1 clinical trial in patients with acute myeloid leukemia (AML) and myelodysplastic syndrome (MDS). Because CB-5339 has not yet reached technological feasibility and has no alternative future uses, the Company expensed the $5.5 million upfront payment as acquired in-process research and development in ~~the accompanying consolidated statements of operations and comprehensive loss for the nine months ended September 30,~~ 2021.

Pharmathen Global BV

On October 29, 2019, the Company entered into an exclusive distribution agreement with Pharmathen Global BV ("Pharmathen") for the development and distribution of octreotide long acting injectable (Octreotide LAI) microsphere in China. Octreotide LAI formulations, which are approved in various European countries, are considered a standard of care for the treatment of acromegaly and the control of symptoms associated with certain neuroendocrine tumors. ~~Subject to regulatory and marketing approvals, the Company~~CASI intends to advance the development, import drug registration, and ~~commercialize~~market approval of this ~~established~~ product in China.

The terms of the agreement include an upfront payment of 1 million euros which was paid by the Company in 2019, and up to 2 million euros of additional milestone payments, of which 1.5 million euros ($1.7 million) was ~~expensed in~~paid by the ~~year ended December 31, 2020~~Company with achievements of certain milestones and was expensed as acquired in-process research and development ~~following Pharmathen’s achievement of certain milestones.~~in 2020. CASI is responsible for the development, import drug registration, product approval and commercialization in China. CASI has a 10-year non-royalty exclusive distribution period after the product launch at an agreed supply costs for the first three years.

Riemser Pharma GmbH

In August 2019, the Company entered into a distribution agreement in China with Riemser Pharma GmbH (“Riemser”) to a novel formulation of thiotepa, a chemotherapeutic agent, which has multiple potential indications including use as a conditioning treatment for use prior to allogenic hematopoietic stem cell transplantation. Thiotepa has a long history of established use in the hematology/oncology setting. Pursuant to the distribution agreement, CASI obtained the exclusive distribution right of the products in China, and Riemser will be responsible for manufacturing and supplying CASI with clinical materials and commercial inventory. The Company is applying NADA registration and, subject to regulatory and marketing approvals, the Company intends to advance and commercialize this product in China. In January 2020, Riemser was acquired by Esteve Healthcare, S.L. (“ESTEVE”), an international pharmaceutical company headquartered in Barcelona, Spain. There is 0 contingent milestone payment due to Riemser under the agreement.

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3. Summary of Significant Accounting Policies

~~Revenue Recognition~~Basis of Presentation

~~Product sales recognized~~The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the ~~consolidated statements~~United States of ~~operations are considered revenue from contracts with customers and, accordingly, the Company recognizes revenue using the following steps:~~

●

~~Identification of the contract, or contracts, with a customer;~~

●

~~Identification of the performance obligations in the contract;~~

●

~~Determination of the transaction price, including the identification and estimation of variable consideration;~~

●

~~Allocation of the transaction price to the performance obligations in the contract; and~~

●

~~Recognition of revenue when the Company satisfies a performance obligation.~~

~~The Company recognizes revenue on sales of EVOMELA~~^® when the control of the product is transferred to the distributor, which occurs upon delivery of the product to the carrier appointed by the distributor, in an amount that reflects the consideration to which the Company expects to be entitled to in exchange for the product, excluding amounts collected on behalf of third parties (e.g. value-added taxes)America (“U.S. GAAP”). ~~Payment terms for these sales are due within 90 days. The arrangement does not include any variable consideration.~~

The costs of assurance type warranties that provide the customer the right to exchange purchased product that does not meet appropriate quality standards are recognized when they are probable and are reasonably estimable. As of September 30, 2021, the Company did not incur, and therefore did not defer, any material costs to obtain or fulfill contracts. The Company did not have any contract assets or contract liabilities as of September 30, 2021.

Use of Estimates

The preparation of ~~unaudited condensed~~ consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. The ~~Company’s~~Company's significant accounting estimates relate to recoverability of operating lease right-of-use assets, intangible assets and long-term investments, net realizable value and obsolescence allowance for ~~inventory,~~inventories, deferred tax assets and valuation allowance, allowance for doubtful accounts, stock-based arrangements and fair value of investments. Management bases its estimates on historical experience and on various other assumptions that it believes are reasonable under the circumstances. Actual results may differ from those estimates, and such differences may be material to the consolidated financial statements.

Recent Accounting Pronouncements

In November 2021, the FASB issued ASU 2021-10, Government Assistance (Topic 832): Disclosures by Business Entities about Government Assistance. This update requires certain annual disclosures about transactions with a government that are accounted for by applying a grant or contribution accounting model by analogy. This update is effective for annual periods beginning after December 15, 2021, and early application is permitted. This guidance should be applied either prospectively to all transactions that are reflected in financial statements at the date of initial application and new transactions that are entered into after the date of initial

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application or retrospectively to those transactions. The Company does not expect the impact of this guidance to have a material impact on the Company’s consolidated financial statements.

In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments — Credit Losses (Topic 326) (“ASU 2016-13”) and subsequent amendments to the initial guidance including ASU No. 2018-19, ASU No. 2019-04, and ASU No. 2019-05 (collectively, “Topic 326”). Topic 326 requires entities to measure all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. This replaces the existing incurred loss model and is applicable to the measurement of credit losses on financial assets measured at amortized cost. This standard is effective for public business entities, excluding entities eligible to be smaller reporting companies for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. For all other entities, this standard is effective for annual and interim periods beginning after December 15, 2022 and early adoption is permitted for annual and interim periods beginning after December 15, 2018. As a smaller reporting company, the Company expects to adopt this standard in fiscal year 2023. The Company is currently assessing the impact that the adoption of this ASU will have on the consolidated financial statements.

4.Revenue Related Information

The Company’s revenue is primarily consisted of sales of EVOMELA^®. As of March 31, 2022, the Company did not incur, and therefore did not defer, any material costs to obtain or fulfill contracts. The Company did not have any contract assets or contract liabilities as of March 31, 2022 and December 31, 2021. There was no product exchange during the periods ended March 31, 2022 and 2021.

5. Investment in Equity Securities, at Fair Value and Long-term Investments

Investment in Equity Securities, at Fair Value

The following table summarizes the Company’s investment in equity securities at fair value as of March 31, 2022 and ~~long-term~~December 31, 2021, respectively:


				Gross
(In thousands)				unrealized		Aggregate fair
March 31, 2022	Classification	Cost		gains /(losses)		value
MaxCyte - equity interest	Investment	$	—	$	2,673	$	2,673
BioInvent - equity interest	Investment	$	5,661	$	(109)	$	5,552
Total						$	8,225


				Gross
(In thousands)				unrealized		Aggregate fair
December 31, 2021	Classification	Cost		gains		value
MaxCyte - equity interest	Investment	$	—	$	3,866	$	3,866
BioInvent - equity interest	Investment	$	5,661	$	341	$	6,002
Total						$	9,868

Unrealized gains on the Company’s equity investment for the three months ended March 31, 2022 and 2021 were NaN and $1.9 million, respectively. Unrealized losses on the Company’s equity investment for the three months ended March 31, 2022 and 2021 were $1.6 million and $0.2 million, respectively. Unrealized gains (losses) on the Company’s equity investments

~~Investment~~ are recognized as change in ~~equity securities, at~~ fair value

~~MaxCyte Inc.~~

~~The Company has an equity~~ of investment in the ~~common stock of MaxCyte, a publicly traded company. The Company’s investment in this equity security is carried at its fair value, with changes in fair value reported in the statement~~consolidated statements of operations ~~each reporting period.~~and comprehensive loss.

~~The fair value of this security was measured using its quoted market price, a Level 1 input, and was $4.6 million~~Long-term Investments

Long-term investments as of ~~September 30, 2021~~March 31, 2022 and ~~$2.7 million as of~~ December 31, ~~2020 (see Note 17).~~

~~BioInvent International AB~~

In October 2020, in conjunction with its license agreement entered into with BioInvent (see Note 2), a publicly traded company, CASI made a $6.3 million investment (equivalent to SEK 53.8 million) to acquire 1.2 million new shares (after 25:1 reverse stock split) of BioInvent, and 14,700,000 warrants, each warrant with a right to subscribe for 0.04 shares (after 25:1 reverse stock split) in BioInvent within a period of five years.

~~The investments in the ordinary shares and warrants of BioInvent are carried at fair value, with changes in fair value reported in the statement of operations each reporting period. The fair value~~2021 consisted of the ~~ordinary shares was measured using its quoted market price, a Level 1 input, and was $4.9 million as of September 30, 2021 and $6.6 million as of December 31, 2020 (see Note 17).~~following:

Gross

Foreign

Gross

unrealized

currency

March 31, 2022

unrealized

losses (including

translation

Aggregate

(In thousands)

Cost

gains

impairment)

adjustment

fair value

Available-for-sale debt securities:

Alesta Therapeutics B.V. - convertible loan

261

—

271

Securities measured at fair value:

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The fair value of the warrants was measured using observable market-based inputs other than quoted prices in active markets for identical assets or liabilities, level 2 inputs. The Company uses the Black-Scholes-Merton valuation model to estimate the fair value of warrants. The fair value of the warrants was $352,000 as of September 30, 2021 (see Note 17), with assumptions including an expected life of 4.16 years, an assumed volatility of 44.95 %, and a risk-free interest rate of 0.0456 %.

~~The following table summarizes the Company’s investment in equity securities at Fair Value as of September 30, 2021:~~

Gross

(In thousands)

unrealized

Aggregate fair
Description

Classification

Cost

gains (losses)

value
MaxCyte - equity interest

Investment

$
—

$
4,591

$
4,591
BioInvent - equity interest

Investment

$
5,661

$
(749)

$
4,912
Total

$
9,503

Unrealized gains or (losses) on the Company’s equity investment for the three months ended September 30, 2021 and 2020 were $(3,729,000) and $862,000. Unrealized gains or (losses) on the Company’s equity investment for the nine months ended September 30, 2021 and 2020 were $(294,000) and $1,171,000. Unrealized gains or (losses) on the Company’s equity investment are recognized as change in fair value of investment in equity securities in the accompanying unaudited condensed consolidated statements of operations and comprehensive loss.

~~Long-term investments~~

~~Long-term investments consisted of the following:~~

September 30,

December 31,

(In thousands)

2021

2020

Available-for-sale debt securities:





Black Belt Tx Limited - convertible loan

$
264

$
83

Securities measured at fair value:

BioInvent International AB - warrants

352

840

Cleave Therapeutics, Inc. - convertible loan

5,589

—

Equity securities without readily determinable fair value:



Black Belt Tx Limited - equity interest

1,385

2,250

Juventas Cell Therapy Ltd - equity interest

26,375

26,059

Juventas Cell Therapy Ltd - put option

212

210

Total

$
34,177

$
29,442

~~Alesta Therapeutics B.V. (previously Black Belt Tx Limited)~~

In April 2019, in conjunction with its license agreement the Company entered into with Black Belt (see Note 2), the Company made a 2 million euros ($2,249,600) equity investment in the ordinary shares of a newly established, privately held UK Company, Black Belt Tx Limited (“Black Belt Tx”), representing a 14.1% equity interest with the right to appoint a non-voting board observer.

Because the Company does not have significant influence over operating and financial policies of Black Belt Tx, and the equity interests do not yet have readily determinable fair value, the investment in Black Belt Tx is stated at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment.

In July 2021, Alesta Therapeutics B.V. (“Alesta Tx”) was incorporated as the parent company holding all shares of Black Belt Tx with same ownership structure as Black Belt Tx. CASI obtained 14.1% equity interest in Alesta Tx in exchange for its 14.1% equity interest in Black Belt Tx. In July 2021, a new investor contributed 750,000 euros to Alesta Tx in exchange for 770,270 newly issued common stocks, representing 8.3% of the fully diluted capital. Upon the completion of the capital contribution, the company’s equity ownership in Alesta Tx was diluted from 14.1% to 12.9% with a fair value of $1,385,000, indicating an impairment of equity investment in Black Belt Tx. The Company recorded impairment of $865,000 representing the difference between the fair value of the investment and its carrying amount during the nine months ended September 30, 2021.

~~Table of Contents~~

In July 2020, the Company entered into a three-year convertible loan agreement with Black Belt Tx (the “Black Belt Tx Loan”) in the amount of 211,800 euros ($250,000) with a non-compounding annual interest rate of 6% payable, together with the principal balance, at maturity.

The loan principal will be disbursed in three equal installments of 70,600 euros. The first tranche of 70,600 euros ($83,000) was disbursed upon execution of the loan agreement in August 2020. The second tranche of 70,600 euros ($86,000) was disbursed in February 2021, upon Black Belt Tx’s achievement of certain operational targets as stipulated in the loan agreement and approved by the Black Belt Tx’s Board of Directors. The third tranche would have been disbursed if Black Belt Tx reaches certain additional operational targets as stipulated in the loan agreement and approved by Black Belt Tx's Board of Directors.

In the event that Black Belt Tx, on or prior to the maturity date, completes an equity financing round of at least €5,000,000 ($5.9 million), then the outstanding principal amount shall be automatically converted into such shares at 80% of the price per share issued divided by a compensating factor based on the number of years that the Black Belt Tx Loan has been outstanding. The investment in convertible loan is accounted for as investment in debt securities as available-for-sale instrument.

In July 2021, Black Belt Tx repaid the convertible loan of 146,566 euros to the Company, including 1st tranche of 70,600 euros, 2nd tranche of 70,600 euros and interest of 5,366 euros. Concurrently, the Company entered into a three-year convertible loan agreement with Alesta Tx (the “Alesta Tx Loan”) in the amount of 217,166 euros with a non-compounding annual interest rate of 6% payable, together with the principal balance, at maturity.

~~Juventas Cell Therapy Ltd~~

In June 2019, in conjunction with its license agreement entered into with Juventas (see Note 2), the Company, through CASI Biopharmaceuticals, made an RMB 80 million ($11,788,000) investment in Juventas, a privately held, China-based company, in Juventas’ Series A plus equity, which represented a 16.327% equity interest on a fully diluted basis, and the right to appoint a non-voting board observer. The Company is entitled to substantive liquidation preference over the founding shareholders of Juventas. In addition, the Juventas’ founding shareholder provided a put option to the Company pursuant to which the Company can put the equity investment to the founding shareholder at a fixed return of 8% per annum upon occurrence of certain events. The investment in the equity interests of the Juventas and the investment in put option to the founding shareholder were accounted for as investments in equity securities using the measurement alternative at its cost, minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer, as the fair value of the equity securities of Juventas is not readily determinable. The consideration of RMB 80 million ($11,788,000) was allocated into investment in equity interests and investment in put option based on their relative fair value on the transaction date.

In September 2020, in conjunction with the Supplementary Agreement entered into with Juventas (see Note 2), the Company obtained additional Series A plus equity interest in Juventas with substantive liquidation preference over Juventas' founding shareholder, resulting in the Company's equity ownership increasing to 16.45% (post-Juventas Series B financing) on a fully diluted basis. CASI Biopharmaceuticals is also entitled to appoint a director to Juventas’ board of directors. Juventas’ founding shareholder also provided a put option to the Company pursuant to which the Company can put the additional equity investment to the founding shareholder at RMB 70 million plus a fixed return of 8% per annum upon occurrence of certain events. The transaction closed on September 29, 2020. The fair value of the Company’s additional equity interest in Juventas and the new put option was estimated using significant estimates and assumptions, including multiples of selected comparable companies in applying the market approach model.

Since the equity interest with substantive liquidation preference is not in-substance common stock, the investment in the additional equity interests of Juventas was accounted for as an investment in equity securities at transaction date fair value with a corresponding credit to Other Liabilities. The profit-sharing liability represents the Company’s obligation to pay an increased share of future profits pursuant to the Supplementary Agreement (see Note 2) which was conveyed by the Company in exchange for the additional equity interests in Juventas. The Company views this as a payment from a vendor that should reduce cost of revenues over the period of royalty payments. The long-term liability will be derecognized as payments are made on a systematic and rational basis representing the pattern in which the Company expects to settle the profit-sharing payment during the commercialization period of CNCT19.

The investments are measured using the measurement alternative at its cost, minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer, as the fair

~~Table of Contents~~

value of the equity securities of Juventas is not readily determinable. The Company did not record any adjustments or impairments during the three and nine months ended September 30, 2021 related to this investment.

In June 2020, the Company entered into a one-year loan agreement with Juventas in the amount of RMB 30,000,000 ($4,243,000) with an annual interest rate of 20%. In August 2020, the Company entered into another ~~one-year~~ loan with Juventas in the amount of RMB 40 million ($5,790,000) for one year with an annual interest rate of 20%. In September 2020, the Company received early repayments for both principals and accrued interest from Juventas.

On October 26, 2021, Juventas Cell Therapy Ltd. (“Juventas”) completed its Series C financing through which it raised capital of RMB 410 million ($63 million). Upon the completion of Juventas Series C financing, the Company’s equity ownership in Juventas decreased to 12.01% on a fully diluted basis.

~~Cleave Therapeutics, Inc.~~

In March 2021, Cleave and the Company entered into a license agreement. Cleave and the Company will develop CB-5339 in both hematological malignancies and solid tumors, with CASI responsible for development and commercialization in China and associated markets. Cleave received a $5.5 million upfront payment and is eligible to receive up to $74 million in development and commercial milestone payments plus tiered royalties in the high-single to mid-double-digit range on net sales of CB-5339. In addition to the upfront cash payment, CASI made a $5.5 million investment in Cleave through a three-year convertible note with a non-compounding annual interest rate of 3% payable at maturity. The principal balance is also due at maturity. The proceeds will support and advance Cleave’s programs and general operations.

In the event that Cleave, on or prior to the maturity date, completes an equity financing round of preferred stock of at least $10.0 million, then the outstanding principal amount and accrued interest shall be automatically converted into such shares at 80% of the price per share issued. The investment in the convertible loan is designated an investment measured at fair value through profit or loss.

BioInvent International AB - warrants		656		—		(123)		—		533
Cleave Therapeutics, Inc. - convertible loan		5,500		222		—		—		5,722
Equity securities without readily determinable fair value:
Alesta Therapeutics B.V. - equity interests		2,250		—		(865)		—		1,385
Juventas Cell Therapy Ltd - equity interests		23,500		6,958		—		1,951		32,409
Juventas Cell Therapy Ltd - put option		491		—		(521)		30		—
Total	$	32,658	$	7,190	$	(1,509)	$	1,981	$	40,320


					Gross		Foreign
			Gross		unrealized		currency
December 31, 2021			unrealized		losses (including		translation		Aggregate
(In thousands)	Cost		gains		impairment)		adjustment		fair value
Available-for-sale debt securities:
Alesta Therapeutics B.V. - convertible loan	$	261	$	7	$	—	$	—	$	268
Securities measured at fair value:
BioInvent International AB - warrants		656		—		(65)		—		591
Cleave Therapeutics, Inc. - convertible loan		5,500		76		—		—		5,576
Equity securities without readily determinable fair value:
Alesta Therapeutics B.V. - equity interests		2,250		—		(865)		—		1,385
Juventas Cell Therapy Ltd - equity interests		23,500		6,958		—		1,850		32,308
Juventas Cell Therapy Ltd - put option		491		—		(521)		30		—
Total	$	32,658	$	7,041	$	(1,451)	$	1,880	$	40,128

6. Inventories

~~Inventories at September 30, 2021~~The Company’s inventories consist of finished goods amounted to $3.7 million and $1.9 million, as of March 31, 2022 and December 31, ~~2020 consisted of the following:~~

(In thousands)

September 30, 2021

December 31, 2020

Finished goods

$
1,727

$
1,356

Raw materials

—

—

Total

$
1,727

$
1,356

2021, respectively. NaN write down to the carrying amount of inventory have been recorded in the three ~~and nine~~ months ended ~~September 30, 2021~~March 31, 2022 and ~~2020.~~2021.

7.Property, Plant and Equipment

Property, plant and equipment consist of the following:


(In thousands)	March 31,		December 31,
	2022		2021
Furniture and equipment	$	1,800	$	1,728
Leasehold improvements		1,136		1,133
Construction in progress		13,986		12,095
Total property, plant and equipment, gross		16,922		14,956
Accumulated depreciation and amortization		(1,914)		(1,817)
Impairment of property, plant and equipment		(428)		(427)
	$	14,580	$	12,712

6.8. Leases

Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. Rent expense is recognized on a straight-line basis over the lease term.

Operating lease liabilities ~~(see below)~~ are included in accrued and other current liabilities and other liabilities (noncurrent) in the ~~unaudited condensed~~ consolidated balance sheets as of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020.~~

All of the Company’s existing leases as of September 30, 2021 are classified as operating leases. As of September 30, 2021, the Company had 8 material operating leases for land and facilities with remaining terms expiring from 2021 through 2069 and a weighted average remaining lease term of 34.89 years. The Company has fair value renewal options for many of the Company’s existing leases, none of which are considered reasonably certain of being exercised or included in the minimum lease term. Weighted average discount rates used in the calculation of the lease liability is 3.58%. The discount rates reflect the estimated incremental borrowing rate, which includes an assessment of the credit rating to determine the rate that the Company would have to pay to borrow, on a collateralized basis for a similar term, an amount equal to the lease payments in a similar economic environment.2021.

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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 manufacturing facility. The land parcel is 74,028.40 square meters. The Company classifies this lease as an operating lease. The Company prepaid all of the lease payments for the land use right in 2019 in the amount of RMB 45 million (equivalent to $6.5 million).

Rent expense for the ~~nine~~three months ended ~~September 30,~~March 31, 2022 and 2021 was $0.4 million and ~~2020 was $1,158,000 and $1,153,000,~~$0.4 million, respectively. There were 0 variable lease costs or sublease income for leased assets for the ~~nine~~three months ended ~~September 30, 2021~~March 31, 2022 and ~~2020.~~2021.

Right of use assets and liabilities as of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020 in~~2021 on the condensed consolidated balance sheets were as follows:


	September 30,		December 31,		March 31,		December 31,
(In thousands)	2021		2020		2022		2021
Right of use assets	$	9,499	$	8,696	$	8,809	$	9,107

Accrued and other current liabilities	$	1,213	$	939	$	989	$	1,061
Other liabilities		1,434		965		894		1,105
Total lease liabilities	$	2,647	$	1,904	$	1,883	$	2,166

Supplemental cash flow information related to leases was as follows:


	Nine Months Ended September 30,				Three Months Ended March 31,
(In thousands)	2021		2020		2022		2021
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows	$	1,087	$	1,064	$	323	$	370

Right of use assets obtained in exchange for lease obligations:	$	1,661	$	1,030	$	10	$	—

All of the Company’s existing leases as of March 31, 2022 and December 31, 2021 are classified as operating leases. As of March 31, 2022 and December 31, 2021, the Company had 9 and 8, respectively, material operating leases for land and facilities with remaining terms expiring from 2022 through 2069 and a weighted average remaining lease term of 37.37 years and 36.47 years, respectively. The Company has fair value renewal options for many of the Company’s existing leases, none of which are considered reasonably certain of being exercised or included in the minimum lease term. Weighted average discount rates used in the calculation of the lease liability for the three months ended March 31, 2022 and 2021 is 3.52% and 3.55%, respectively. The discount rates reflect the estimated incremental borrowing rate, which includes an assessment of the credit rating to determine the rate that the Company would have to pay to borrow, on a collateralized basis for a similar term, an amount equal to the lease payments in a similar economic environment.

A maturity analysis representing the future undiscounted cash flow of the Company’s operating leases liabilities as of ~~September 30, 2021~~March 31, 2022 is as follows:

~~Future undiscounted cash flows:~~


(In thousands)
2021 (remaining three months)	$	355
2022		1,157
2022 (remaining nine months)			$	804
2023		803		779
Thereafter		373
2024				367
Total		2,688		1,950

Discount factor		(41)		(67)
Lease liability		2,647		1,883
Amounts due within 12 months		1,213		989
Non-current lease liability	$	1,434	$	894

~~7. Intangible Assets~~

Intangible assets include ANDAs that were acquired as part of 2018 asset acquisitions of U.S. marketed generic products, as well as capitalized costs related to a cloud computing arrangement (CCA). These intangible assets were originally recorded at relative estimated fair values based on the purchase price for the asset acquisitions and are stated net of accumulated amortization and impairment, if any.

~~The ANDAs are amortized over their estimated useful lives of 13 years, using the straight-line method. The CCA is being amortized over its useful life of 5 years.~~

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~~In February 2020, the Company entered into an agreement with Chartwell Rx Sciences, LLC (“Chartwell”) in which the Company sold~~9.Accrued and transferred the control of 7 U.S. FDA-approved ANDAs to Chartwell in exchange for $450,000 in cash, which the Company received in March 2020. These ANDAs had a net book value of $0 at the time of sale. The Company is entitled to an additional $1 million, contingent upon Chartwell receiving certain FDA approvals relating to certain of these ANDAs. The Company recognized a gain on disposal of intangible assets in the amount of $450,000 in the accompanying unaudited condensed consolidated statement of operationsOther Current Liabilities, and comprehensive loss for the three months ended March 31, 2020. The additional $1 million is treated as variable consideration. Because the amount of variable consideration is highly susceptible to factors outside the Company's influence and the Company’s experience with similar types of contracts is limited, the Company did not include the amount of variable consideration in recognition of gain on disposal of intangible assets for the three months ended March 31, 2020. The Company will recognize the variable consideration and additional gain on disposal of intangible assets when the constraint on variable consideration is resolved, i.e., Chartwell receives relevant FDA approvals. As of September 30, 2021, no FDA approvals has been obtained by Chartwell on those products.Other Liabilities


	March 31,		December 31,
(In thousands)	2022		2021
Accrued and other current liabilities:
Payroll and welfare payable	$	2,142	$	3,336
Payables related to property and equipment		2,954		3,288
Lease liabilities-current		989		1,061
Value-added tax and other tax payable		391		652
Other		225		60
	$	6,701	$	8,397

Other Liabilites
Profit-sharing liabiliy to Juventas	$	13,262	$	13,220
Lease liabilities-noncurrent		894		1,105
	$	14,156	$	14,325

~~Intangible assets at September 30, 2021 consists of the following:~~

(In thousands)

Asset

Purchase Price

Accumulated Amortization

Estimated useful lives
ANDAs

$
15,832

(3,540)

13 years
Others

197

(131)

5 years
Total

$
16,029

$
(3,671)

~~The changes in intangible assets for nine months ended September 30, 2021 are as follows:~~

(In thousands)

Balance as of December 31, 2020

$
13,210
Amortization expense

(1,009)
Foreign currency translation adjustment

157
Balance as of September 30, 2021

$
12,358

~~Expected future amortization expense, is as follows:~~

(In thousands)

2021 (remaining three months)

$
334
2022

1,334
2023

1,334
2024

1,303
2025

1,303
2026 and thereafter

6,750

~~8. Grants~~

In April 2020, CASI Wuxi received RMB 15.9 million (equivalent to $2.2 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 April 2020. The grant will be amortized over the term of the lease of the land. Since April 2020, the Company has recognized RMB 481,000 in deferred income as of September 30, 2021, and therefore, RMB 15.4 million (equivalent to $2.4 million) remain as deferred income in the unaudited condensed balance sheet as of September 30, 2021. The Company recognized $12,000 and $12,000 of other income during the three months ended September 30, 2021 and 2020, respectively. The Company recognized $37,000 and $23,000 of other income during the nine months ended September 30, 2021 and 2020, respectively.

~~Table of Contents~~

~~9. Bank Borrowings~~

On November 3, 2020, Beijing Branch of China CITIC Bank Corporation Limited approved a guaranteed line of Credit (“Bank Borrowings) to the Company with maximum borrowings of RMB 10.0 million ($1.5 million). The joint and several liability guarantee was provided by Beijing Capital Financing Guarantee Co, Ltd. At December 31, 2020, the Company had outstanding borrowings under the Bank Borrowings of RMB 5.4 million ($826,000), which matures on November 7, 2021, and bears interest at a fixed rate of 3.35% per annum.

On February 3, 2021, the Company had additional bank borrowings of RMB 4.6 million ($0.7 million), of which RMB 3.0 million ($0.5 million) repaid on September 2, 2021 and the remainder balance matures on November 7, 2021. These additional bank borrowings bear interest at a fixed rate of 3.72% per annum.

~~Interest expense of $12,000 and $37,000 was recorded in the three and nine months ended September 30, 2021.~~

~~10. Notes Payable~~

On April 27, 2020, M&T Bank approved a $465,595 loan to the Company under the Paycheck Protection Program (PPP) pursuant to the Coronavirus Aid, Relief and Economic Security (CARES) Act that was signed into law on March 27, 2020. The loan, evidenced by a promissory note to M&T Bank as lender and dated April 29, 2020, has a term of two years, is unsecured, and is guaranteed by the Small Business Administration (SBA). The loan bears interest at a fixed rate of 1 percent per annum. Some or all of the loan may be forgiven if the Company complies with certain relevant conditions. In June 2020, the PPP was amended through enactment of the Paycheck Protection Program Flexibility Act of 2020 (PPPFA). Under the new act, the Company’s payments of principal and interest are deferred until October 2021. In September 2021, the loan principal of $465,595 and outstanding interest of $6,212 were forgiven.

Interest expenses of $900 and $1,200 were recorded in the three months ended September 30, 2021 and 2020. Interest expenses of $2,900 and $1,900 were recorded in the nine months ended September 30, 2021 and 2020.

~~11. Redeemable Noncontrolling Interest~~

On December 26, 2018, the Company, together with Wuxi Jintou Huicun Investment Enterprise, a limited partnership organized under Chinese law (“Wuxi LP”) established CASI Wuxi to build and operate a manufacturing facility in the Wuxi Huishan Economic Development Zone in Jiangsu Province, China. The Company holds 80% of the equity interests in CASI Wuxi and will invest, over time, $80 million in CASI Wuxi. The Company’s investment will consist of (i) $21 million in cash (paid in February 2019), (ii) a transfer of selected ANDAs valued at $30 million (transferred in May 2019), and (iii) an additional $29 million cash payment within three years from the date of establishment of CASI Wuxi. The payment schedule has been changed into 3 installments of $10 million paid in July 2021, $10 million and $9 million to be paid in 2022 and 2023, respectively. Wuxi LP holds 20% of the equity interest in CASI Wuxi through its investment in RMB of $20 million in cash (paid in March 2019). As the transfer of ANDAs valued at $30 million was to the Company’s consolidated subsidiary (CASI Wuxi), the Company recognized the transfer of the ANDAs at their carrying value and did not recognize a gain on the transfer.

Pursuant to the investment contract between the Company and Wuxi LP and Articles of Association of CASI Wuxi, the Company has the call option to purchase the 20% equity interest in CASI Wuxi held by Wuxi LP at any time within 5 years from the date of establishment of CASI Wuxi (i.e. up to December 26, 2023). Wuxi LP has the put option to require the Company to redeem the 20% equity interest in CASI Wuxi at any time after December 26, 2023. The redemption value under both the Company’s embedded put option and Wuxi LP’s embedded call option is equal to $20 million plus interest at the bank loan interest rate issued by the People's Bank of China for the period beginning with the initial capital contribution by Wuxi LP to the date of redemption. In addition, Wuxi LP has the put option to require the Company to redeem the 20% equity interest in CASI Wuxi at $20 million upon the occurrence of any of the following conditions: (i) the Company fails to fulfill its investment obligation to CASI Wuxi; (ii) CASI Wuxi suffers serious losses, discontinued operation, dissolution, goes into process of bankruptcy liquidation; or (iii) the Company substantially violates the investment contract and Articles of Association of CASI Wuxi.

~~Table of Contents~~

The investment of Wuxi LP in CASI Wuxi is treated as redeemable noncontrolling interest and is classified outside of permanent equity on the consolidated balance sheets because (1) the noncontrolling interest is not mandatorily redeemable financial instruments, and (2) it is redeemable at the option of the holder, or upon the occurrence of an event that is not solely within the control of the Company. The Company initially recorded the redeemable noncontrolling interest at its fair value of $20 million. The carrying amount of the redeemable noncontrolling interest is subsequently recorded at the greater of the amount of (1) the initial carrying amount, increased or decreased for the redeemable noncontrolling interest’s share of net income or loss in CASI Wuxi or (2) the redemption value, assuming the noncontrolling interest is redeemable at the balance sheet date. ~~Accretion of the carrying amount of redeemable noncontrolling interest to the redemption value is recorded in additional paid-in capital.~~10. Redeemable Noncontrolling Interest

Changes in redeemable noncontrolling interest during the three ~~and nine~~ month periods ended ~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~ are as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,				Three Months Ended March 31,
(In thousands)	2021		2020		2021		2020		2022		2021
Balance at beginning of period	$	22,697	$	21,074	$	22,033	$	20,670	$	23,457	$	22,033
Cash contribution by Wuxi LP				0				0
Share of CASI Wuxi net loss		(314)		(309)		(980)		(584)		(417)		(349)
Accretion of redeemable noncontrolling interest		519		506		1,586		1,185		613		548
Foreign currency translation adjustment		5		—		268		—		73		(68)
Balance at end of period	$	22,907	$	21,271	$	22,907	$	21,271	$	23,726	$	22,164

~~12.~~11. Stockholders’ Equity

Stock Repurchase Program

On December 15, 2021, the board of directors of CASI Pharmaceuticals, Inc. (the “Company”) approved a stock repurchase program for the repurchase of up to $10 million of the Company’s common stock (and no more than 12,500,000 shares of the Company’s common stock) through open market purchases in compliance with Rule 10b-18 under the Securities Exchange Act of 1934 and through trading plans established pursuant to Rule 10b5-1 of the Securities Exchange Act. The trading plan was terminated on March 31, 2022, and as of March 31, 2022, the Company has repurchased 3,734,992 shares of common stock amounted to $3.0 million.

March 2021 Underwritten Public Offering

On March ~~26,~~24, 2021, the Company closed an underwritten public offering of 15,853,658 shares of the Company’s common stock (the “Offering”) at a price to the public of $2.05 per share. The gross proceeds to CASI from the Offering were $32.5 million before deducting the underwriting discounts and commissions and offering expenses payable by CASI.

The Company is using the net proceeds of this offering for working capital and general corporate purposes, which include, but are not limited to advancing the Company’s product portfolio, acquiring the rights to new product candidates and general and administrative expenses.

Common Stock Sales Agreements

The Company entered a Common Stock Sales Agreement (the “Sales Agreement”), as amended, with H.C. Wainwright & Co., LLC (“HCW”) that would allow the Company to sell up to $20 million of shares of common stock in “at-the-market” transactions, subject to compliance with the terms and conditions of the Sales Agreement. During the nine months ended September 30, 2021, the Company has not offered and sold any shares of common stock under the Sales Agreement.

On July 19, 2019, the Company entered into an Open Market Sale Agreement^SM with Jefferies LLC, as sales agent (the “Open Market Agreement”) pursuant to which the Company may elect to sell from time to time, at its option, up to $30 million in shares of the Company’s common stock, subject to the terms and conditions of the Open Market Agreement. During the ~~nine~~three months ended ~~September 30, 2021,~~March

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31, 2022, the Company has not offered and sold any shares of common stock under the Open Market Agreement. As of March 31, 2022, the Company has issued 493,000 shares with net proceeds of $1.5 million, with remained $28.5 million available under the Open Market Agreement.

On October 29, 2021, the Company has entered into a common stock sales agreement (“Stock Sales Agreement”), with H.C. Wainwright & Co., LLC, relating to shares of common stock of the Company. In accordance with the terms of the sales agreement, the Company may offer and sell shares of common stock in “at-the-market” transactions, subject to compliance with the terms and conditions of the Stock Sales Agreement, with an aggregate offering price of not more than $20,000,000. As of March 31, 2022, the Company has not offered or sold any shares of common stock under the sales agreement.

Stock Purchase Warrants

In history, the Company issued shares of its common stock with accompanying warrants to certain institutional investors, accredited investors and existing stockholders.

As of ~~September 30, 2021,~~March 31, 2022, the outstanding and exercisable number of warrants was ~~6,172,832. Total 8,271,709 number of warrants were issued by the Company in September 2018. On September 24, 2021, 2,098,877 number of warrants were expired. The~~6,172,832 with weighted average exercise price ~~was~~of $3.69. All outstanding warrants are equity classified.

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~~13. 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. The Company is obligated to pay 20% of the Company’s revenue from EVOMELA as royalties for a period of 10 years after the commercial launch of the products in 2019.

~~14.~~12. Net Loss Per Share

Net loss per share (basic and diluted) was computed by dividing net loss attributable to common stockholders, considering the accretions to redemption value of the redeemable noncontrolling interest, by the weighted average number of shares of common stock outstanding. As of March 31, 2022 and December 31, 2021, outstanding stock options totaling 32,491,790 and 33,243,790, respectively, and outstanding warrants both totaling 6,172,832, were anti-dilutive, and therefore, were not included in the computation of weighted average shares used in computing diluted loss per share.

The following table sets forth the basic and diluted net loss per share computation and provides a reconciliation of the numerator and denominator for the periods presented:


	Three Months Ended September 30,				Nine Months Ended September 30,				Three Months Ended March 31,
(In thousands, except share and per share data)	2021		2020		2021		2020		2022		2021
Numerator:
Net loss attributable to CASI Pharmaceuticals, Inc.	$	(10,224)	$	(16,953)	$	(31,053)	$	(34,088)	$	(8,596)	$	(13,883)
Denominator:
Weighted average number of common shares		139,797,487		117,940,405		134,861,366		105,922,281
Weighted average number of common stock										137,955,910		124,824,588
Denominator for basic and diluted net loss per share calculation		139,797,487		117,940,405		134,861,366		105,922,281		137,955,910		124,824,588
Net loss per share
— Basic and diluted	$	(0.07)	$	(0.14)	$	(0.23)	$	(0.32)	$	(0.06)	$	(0.11)

As of September 30, 2021, and 2020, outstanding stock options totaling 31,357,040 and 15,956,030, respectively, and outstanding warrants totaling 6,172,832 and 8,271,709, respectively, were anti-dilutive, and therefore, were not included in the computation of weighted average shares used in computing diluted loss per share.

~~15.~~13. Stock-Based Compensation

~~On June 15, 2021,~~The Company has adopted various stock compensation plans for executive, scientific and administrative personnel of the 2021 Long-Term Incentive Plan (the “2021 Plan”) was approved by the Company's stockholders to replace the Company’s 2011 Long-Term Incentive Plan (the “2011 Plan”). Currently, the 2021 Plan is administered by the Company’s compensation committee. The maximum number of shares of Common Stock that are available for grantsCompany, as well as outside directors and awards equals to 20,000,000 shares of Common Stock, which includes 10,726,673 shares of Common Stock remaining under the Company’s 2011 Long-Term Incentive Plan (the “2011 Plan”) as of April 12, 2021.

~~As of September 30, 2021, a total of 12,405,448 shares remained available for grant under the Company’s 2021 Long-Term Incentive Plan.~~consultants.

The ~~Company’s net loss for the nine months ended September 30, 2021 and 2020 includes $5.1 million and $5.7 million, respectively, of the Company’s share-based compensation. The share-based~~stock-based compensation expenses are recorded as components of ~~general~~research and ~~administrative~~development expense, ~~selling~~sales and marketing expense, and ~~research~~general and ~~development~~administrative expense, as follows:


	Nine Months Ended September 30,				Three Months Ended March 31,
(In thousands)	2021		2020		2022		2021
Research and development	$	251	$	123	$	178	$	75
Sales and Marketing		212		—		59		33
General and administrative		4,596		5,562		1,671		1,890
Share-based compensation expense	$	5,059	$	5,685
Stock-based compensation expense					$	1,908	$	1,998

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Compensation expense related to stock options is recognized over the requisite service period, which is generally the option vesting term of up to five years. Awards with performance conditions are expensed when it is probable that the performance condition will be achieved. For the nine month periods ended September 30, 2021 and 2020, $1,056,000 and $13,000 was expensed for stock option awards with performance conditions that were probable during the period, respectively.

The Company uses the Black-Scholes-Merton valuation model to estimate the fair value of service based and performance-based stock options granted to employees. Option valuation models, including Black-Scholes-Merton, require the input of highly subjective assumptions, and changes in the assumptions used can materially affect the grant date fair value of an award. These assumptions include the risk-free interest rate, expected dividend yield, expected volatility, and the expected life of the award.

~~Following are the weighted-average assumptions used in valuing the stock options granted to employees during the nine month periods ended September 30, 2021 and 2020:~~

Nine Months Ended September 30,


2021

2020


Expected volatility

79.72
%
77.71
%

Range of expected volatility

76.64% to 81.5
%
75.84% to 81.63
%

Range of risk free interest rate

0.72% to 1.22
%
0.31% to 1.77
%

Expected term of option

6.18
years
6.03
years

Expected dividend yield

0.00
%
0.00
%

~~The weighted average fair value of stock options granted during the nine month periods ended September 30, 2021 and 2020 were $1.05 and $1.96, respectively.~~

~~On June 15, 2021, the Board approved a grant of stock options to Wei-Wu He. The grant consists of 4 million shares time-based and 4 million shares performance-based stock options.~~

~~A summary of changes in options under the Company’s stock option plans during the nine month period ended September 30, 2021 is as follows:~~

Weighted Average


Number of Options

Exercise Price

Outstanding at December 31, 2020

16,746,238

$
2.71

Exercised

0

$
0

Granted

15,989,552

$
1.57

Expired

(343,750)

$
4.76

Forfeited

(1,035,000)

$
2.65

Cancelled

0

$
0

Outstanding at September 30, 2021

31,357,040

$
2.11

Vested and expected to vest at September 30, 2021

31,357,040

$
2.11

Exercisable at September 30, 2021

14,110,876

$
2.54

~~Cash received from option exercises under all share-based payment arrangements for the nine month periods ended September 30, 2021 and 2020 was $0 million and $3.9 million, respectively.~~

~~16.~~14. Income Taxes

At December 31, ~~2020,~~2021, the Company had a ~~$2.1~~$1.4 million unrecognized tax benefit. The Company recorded a full valuation allowance on the deferred tax asset after offsetting unrecognized tax benefit recognized in the consolidated financial statements as of December 31, ~~2020.~~2021.

During the ~~nine~~three months ended ~~September 30, 2021,~~March 31, 2022, there were 0 material changes to the measurement of unrecognized tax benefits in various tax jurisdictions.

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~~17.~~15. Fair Value Measurements

~~The majority~~Financial instruments of the ~~Company’s financial instruments (consisting~~Company primarily consist of cash and cash equivalents, investment in equity securities, accounts receivable, long-term investments, accounts payable, accrued liabilities, notes payable and bank borrowings. As of March 31, 2022 and December 31, 2021, the carrying amount of cash and cash equivalents, accounts receivable, accounts payable, accrued liabilities, notes payable and bank ~~borrowings)~~borrowings are carried at cost which approximates their fair values due to the short-term nature of the instruments. ~~The Company’s investments in equity securities are carried at fair value, and investments in convertible loans are carried at fair value (see Note 4).~~

Fair value is the price that would be received from the sale of an asset or paid to transfer a liability assuming an orderly transaction in the most advantageous market at the measurement date. U.S. GAAP establishes a hierarchical disclosure framework which prioritizes and ranks the level of observability of inputs used in measuring fair value. These tiers include:

●

Level 1—Quoted prices (unadjusted) in active markets that are accessible at the measurement date for identical assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs.

●

~~Level 2—Observable market-based inputs other than quoted prices in active markets for identical assets or liabilities.~~

●

~~Level 3—Unobservable inputs are used when little or no market data is available. The fair value hierarchy gives the lowest priority to Level 3 inputs.~~

Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis

The Company evaluates financial assets and liabilities subject to fair value measurements on a recurring basis to determine the appropriate level at which to classify them each reporting period. This determination requires the Company to make subjective judgments as to the significance of inputs used in determining fair value and where such inputs lie within the hierarchy.

The Company has equity investments in the common stock of two publicly traded companies. The Company’s investments in these equity securities are carried at their estimated fair value, with changes in fair value reported in the consolidated statement of operations and comprehensive loss each reporting ~~period (see Note 4).~~period. The fair value of the common stock is based on quoted market price for the investees’ common stock, a Level 1 input.

The Company has an equity investment in the warrants of a publicly traded company. The Company’s investment is carried at its estimated fair value, with changes in fair value reported in the consolidated statement of operations and comprehensive loss each reporting ~~period (see Note 4).~~period. The fair value of the warrants was measured using observable market-based inputs other than quoted prices in active markets for identical assets, ~~or liabilities,~~ level 2 inputs. The Company uses the Black-Scholes-Merton valuation model to estimate the fair value of warrants. Option valuation models, including Black-Scholes-Merton, require the input of highly subjective assumptions, and changes in the assumptions used can materially affect the fair value determination of a warrant.

The Company has an investment in the convertible debt of ~~a privately held UK Company.~~Black Belt Tx. The Company’s investment is carried at its estimated fair value, with changes in fair value reported in the consolidated statement of operations and comprehensive loss each reporting period ~~(see Note 4)~~using Level 3 input.

The Company has an investment in the convertible debt of ~~a privately held California Company.~~Cleave. The Company’s investment is carried at its estimated fair value, with changes in fair value reported in the consolidated statement of operations and comprehensive loss each reporting period ~~(see Note 4)~~ using Level 3 input. The ~~Company uses the Binomial model~~unpaid balance for this convertible debt amounted to ~~estimate the fair value~~$5.7 million and $5.6 million as of ~~the convertible debt.~~March 31, 2022 and December 31, 2021, respectively.

The following tables present the Company’s financial assets ~~and liabilities~~ accounted for at fair value on a recurring basis as of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020,~~2021, by level within the fair value hierarchy:

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(In thousands)

Fair Value at

Description

September 30, 2021

Level 1

Level 2

Level 3
Investments in Current and non-Current Assets

Investments in common stock

$
9,503

$
9,503

$
0

$
0
Investment in warrants - Designated as investment measured at FVTPL

$
352

$
0

$
352

$
—
Investment in convertible loan - AFS

$
264

$
0

$
0

$
264
Investment in convertible loan - Designated as investment measured at FVTPL

$
5,589

$
0

$
0

$
5,589


(In thousands)	Fair Value at
Description	March 31, 2022		Level 1		Level 2		Level 3
Investments classified as Current and non-Current Assets
Investments in common stock	$	8,225	$	8,225	$	0	$	0
Investment in warrants - Designated as investment measured at FVTPL	$	533	$	0	$	533	$	0
Investment in convertible loan - AFS	$	271	$	0	$	0	$	271
Investment in convertible loan - Designated as investment measured at FVTPL	$	5,722	$	0	$	0	$	5,722

	Quantitative Information about Level 3 Fair Value Measurements
	Fair Value at		Valuation		Unobservable
Description	March 31, 2022		Techniques		Input		Average/Median
Investment in convertible loan - Designated as investment measured at FVTPL	$	5,722		Discounted cash flow		Discount rate		20%/20%


(In thousands)	Fair Value at								Fair Value at
Description	December 31, 2020		Level 1		Level 2		Level 3		December 31, 2021		Level 1		Level 2		Level 3
Investments in Current and non-Current Assets
Investments classified as Current and non-Current Assets
Investments in common stock	$	9,309	$	9,309	$	0	$	0	$	9,868	$	9,868	$	0	$	0
Investment in warrants - Designated as investment measured at FVTPL	$	840	$	—	$	840	$	—	$	591	$	0	$	591	$	0
Investment in convertible loan - AFS	$	83	$	0	$	0	$	83	$	268	$	0	$	0	$	268
Investment in convertible loan - Designated as investment measured at FVTPL									$	5,576	$	0	$	0	$	5,576

									Quantitative Information about Level 3 Fair Value Measurements
									Fair Value at		Valuation		Unobservable
Description									December 31, 2021		Techniques		Input		Average/Median
Investment in convertible loan - Designated as investment measured at FVTPL									$	5,576		Discounted cash flow		Discount rate		20%/20%

Financial Assets and Liabilities Measured at Fair Value on a Non-Recurring Basis

The Company measures equity investments without readily determinable fair values at its cost, minus impairment, if any, plus or minus changes resulting from observable transactions of identical or similar securities of the same issuer. On June 30, 2021, the Company remeasured the investment in equity securities in Black Belt (see Note 4) to the fair value of $1,385,000. The Company estimated the fair value of the securities using Level 2 inputs based on the transaction price of identical securities issued by the investee.

Non-Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis

The Company has 0 non-financial assets and liabilities that are measured at fair value on a recurring ~~basis.~~basis as of March 31, 2022.

Non-Financial Assets and Liabilities Measured at Fair Value on a Non-Recurring Basis

The Company has 0 non-financial assets and liabilities that are measured at fair value on a ~~non- recurring basis.~~non-recurring basis as of March 31, 2022.

~~18.~~16. Related Party Transactions

Juventas. On July 1, 2019 the Company entered into a one-year equipment lease with Juventas, ~~in the amount of RMB 80,000 ($15,000) a month,~~ which is classified as an operating lease. Transactions with Juventas are considered to be related party transactions as the Company’s CEO and Chairman is the chairman and one of the founding shareholders of Juventas. The lease was renewed for another year in July 2020 and in June ~~2021 with the same monthly lease income.~~2021. During the three months ended ~~September 30,~~March 31, 2022 and 2021, ~~and 2020,~~ the Company recognized lease income of RMB 240,000 ($37,000) and RMB 240,000 ($~~37,000)~~36,000) respectively. ~~During the nine months ended September 30, 2021 and 2020, the Company recognized lease income of RMB 720,000 ($110,000) and RMB 720,000 ($104,000) respectively.~~

~~Spectrum/Acrotech. In 2018, the Company entered into commercial purchase obligation commitments for EVOMELA~~^® ~~from Spectrum Pharmaceuticals, Inc. (“Spectrum”), totaling $9.2 million under a short-term supply agreement for EVOMELA~~^®. As of September 30, 2021, Spectrum is a 4.9% stockholder of the Company. The amount due to Spectrum was $0.2 million as of December 31, 2019 which was paid in 2020. There have been no transactions with Spectrum during the nine months ended September 30, 2021. The Company also accrued $2.6 million for material costs related to EVOMELA^® ~~during the year ended December 31, 2019. As of September 30, 2021, all amounts due to Spectrum have been settled.~~

~~BioCheck.~~ In June 2019, the Company entered into a one-year agreement primarily for the sublease of certain office and lab space with BioCheck Inc. (“BioCheck”) in the amount of $60,000 ($5,000 a month), which is classified as an operating lease. Transactions with BioCheck are considered to be related party transactions because the Company’s Chairman and CEO is also the Chairman of BioCheck. Transactions with ETP, parent of BioCheck, and a more than 5% shareholder of the Company, are also considered to be related party transactions because Dr. Wei-Wu He is also the chairman of ETP.

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Because the Company required additional office space, in January 2020, the agreement was amended for annualized rents in the amount of $144,000 ($12,000 a month) with a stipulation that the new rent was retroactive to October 1, 2019. The lease expired on June 9, 2021 and was not renewed. During the nine months ended September 30, 2021 and 2020, the Company recognized rent expense of $60,000 and $108,000, respectively.

March 2021 Underwritten Public Offering Transactions. On March ~~26,~~24, 2021, the Company closed an underwritten public offering of 15,853,658 shares of the Company’s common stock (the “Offering”) at a price to the public of $2.05 per share. The gross proceeds to CASI from the Offering were $32.5 million before deducting the underwriting discounts and commissions and offering expenses payable by CASI.

ETP ~~Global~~BioHealth III Fund ~~L.P.~~LP (“ETP ~~Global”~~BioHealth”), ~~whose founding and managing member is~~in which CASI's Chairman and CEO is the founder and managing partner of ETP BioHealth’s general partner (Emerging Technology Partners, LLC (“ETP”)), purchased shares of common stock in the Offering at the public offering price and on the same terms as the other purchasers in the Offering. ETP ~~Global, which is a current shareholder of CASI,~~BioHealth purchased 3,000,000 shares at the public offering price of $2.05 per share for a total of $6.15 million.

~~19.~~17. Commitments and Contignencies

In conjunction with the Cleave agreement entered into during 2021 (see Note 2), the Company is responsible for certain milestone and royalty payments. As of ~~September 30, 2021,~~March 31, 2022, 0 milestones have been achieved.

In conjunction with the BioInvent agreement entered into during 2020 (see Note 2), the Company is responsible for certain milestone and royalty payments. As of ~~September 30, 2021,~~March 31, 2022, 0 milestones have been achieved.

In conjunction with the Black Belt agreement entered into during 2019 (see Note 2), the Company is responsible for certain milestone and royalty payments. In June 2021, the Company achieved the First-Patient-In (FPI) in the Phase 1 dose escalation and expansion study of CID-103, and made $750,000 milestone payment in June 2021 and 250,000 euros ($~~298,000)~~305,000) in August 2021. As of ~~September 30, 2021,~~March 31, 2022, 0 other milestones have been achieved.

In conjunction with the Pharmathen agreement entered into during 2019 (see Note 2), the Company is responsible for 1 remaining milestone payment. As of ~~September 30, 2021,~~March 31, 2022, the remaining milestone has not been achieved.

In conjunction with the Laurus Labs agreement entered into during 2018, the Company is responsible for certain remaining milestone payments. As of September 30, 2021, the remaining milestones have not been met.

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. OnPursuant to the agreement, CASI Wuxi has committed to invest land use right and property, plant and equipment of RMB1 billion (equivalent to $143 million) by August ~~27,~~2022. In 2020, for the design and construction work of the land, CASI Wuxi entered into a Construction Project Contract (the "Construction Contract") with China Electronic System Engineering No. 2 Construction Co., Ltd. ("China Engineering"). Pursuant to the Construction Contract, CASI Wuxi will pay a contract price ofseveral contracts for RMB ~~74,588,000 (equivalent to $10,923,000) to retain China Engineering~~76.1 million ($12.0 million) to complete the phase 1 project of CASI Wuxi's research and development production base, ~~consisting of construction~~the project was estimated to be completed in October 2023. In February 2022, the Company has reached an alignment with the Wuxi local government that it will collaborate with Wuxi LP to co-develop the land continuously in the future, and ~~installation of a combined factory building, warehouse, guard house and public works.~~the original three-year investment plan will be extended, details regarding the plan are under negotiation. As of ~~September 30, 2021,~~March 31, 2022, the commitment under ~~the Construction Contract~~these contracts was RMB ~~66,688,000~~57.9 million ($~~10,320,000)~~9.1 million). ~~The estimated completion date is October 2023.~~

~~In April 2021,~~

Also in 2020, CASI Wuxi entered ~~into~~in to a ~~freeze dryer and filling line equipments production~~lease agreement with ~~Shanghai Dong Fu Long Technology Limited Co. in~~local government for a manufactory building next to the ~~total amount of RMB15,500,000 (equivalent to $2,400,000). The~~leased land. Since then, the Company paid the deposit of RMB 4,650,000 ($720,000). As of September 30, 2021, the remaining RMB 9,670,000 ($1,500,000) has not been paid. RMB 3,470,000 ($540,000) will be due when CASI obtains quality acceptance approval, another RMB 4,650,000 ($720,000) due when CASI obtains acceptance report (SAT report), and last RMB 1,550,000 ($240,000) due when CASI receives guarantee from the bank. This last 10% payment is subject to quality acceptance condition. Their bank will issue a guarantee document to CASI. After one year following the SAT report, if there is no quality issue exists, the bank will unfreeze the 10% fund to Dong Fu Long.

~~In August 2021, CASI Wuxi~~ entered into a ~~construction agreement with China Engineering in~~series of contracts for the remodeling and installation work of the building and warehouse, as well as purchase of equipments. The total contract amount ofentered into for this building is approximately RMB ~~28,800,000 (equivalent to $4,470,000) for WuXi factory building remodelling~~92.1 million ($14.5 million), and ~~installation. As of September 30, 2021,~~ the commitment under ~~the agreement~~these contracts was RMB ~~20,000,000~~6.2 million ($~~3,100,000).~~

~~Table~~1.0 million) as of ~~Contents~~

In September 2021, CASI Wuxi entered into a construction agreement with China Engineering in the total amount of RMB 11,700,000 (equivalent to $1,811,000) for supply chain & warehouse remodelling and installation. As of September 30, 2021, the commitment outstanding under the agreement was RMB 9,995,000 ($1,547,000).March 31, 2022.

The Company 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.

~~20.~~ 18. Subsequent Events

~~On October 29, 2021,~~

Based on the ~~Company has entered into a common stock sales agreement (“stock sales agreement”), with H.C. Wainwright & Co., LLC (“Wainwright”), relating to shares of common stock~~FDA withdrawal of the ~~Company, $0.01 par value per share. In accordance with~~approved US indication for MARQIBO® (Vincristine Sulfate Liposome Injection) in May 2022, the ~~terms of~~product rights and perpetual exclusive licenses to develop and commercialize MARQIBO® in the ~~sales agreement,~~greater China region have been returned to Acrotech. There is no financial impact on the ~~Company may offer and sell shares of common stock having an aggregate offering price of not more than $20,000,000.~~Company’s consolidated financial statements.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF ~~OPERATIONS.~~OPERATIONS

~~Overview~~OVERVIEW

CASI Pharmaceuticals, Inc. (“~~CASI,”~~CASI” or the ~~“Company,”~~ “Company”, or “we” or ~~"our"~~“our”) (Nasdaq: CASI) is a U.S. biopharmaceutical company focused on developing and commercializing innovative therapeutics and pharmaceutical products in China, the United States, and throughout the world. ~~The Company is~~We were incorporated in 1991, and in 2012, with new leadership, we shifted our 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. We are focused on acquiring, developing and commercializing products that augment ~~its~~our hematology oncology therapeutic focus as well as other areas of unmet medical need. ~~The Company is~~We are executing ~~its~~our plan to become a biopharmaceutical leader by launching medicines in the greater China market, leveraging ~~its~~our China-based regulatory, clinical and commercial competencies and ~~its~~our global drug development expertise. The majority of our operations are now 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 is 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.

~~The Company~~We launched ~~its~~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 multiple myeloma. The other core hematology/oncology assets in ~~the Company’s~~our pipeline include:

●

CNCT19 is an autologous CD19 CAR-T investigative product ~~(CNCT19)~~(“CNCT19”) being developed by ~~the Company’s~~our partner Juventas Cell Therapy ~~Ltd~~Ltd. (“Juventas”) for which ~~the Company has~~we have exclusive World-Wide co-commercial and profit-sharing rights. CNCT19 is being developed as a potential treatment for patients with hematological malignancies which express CD19 including, B-cell acute lymphoblastic leukemia (“B-ALL”) and B-cell non-Hodgkin lymphoma (“B-NHL”). ~~CNCT19’s~~The CNCT19 Phase 1 studies ofin patients with B-ALL and B-NHL in China have been completed by Juventas, ~~with the Phase 2 B-NHL registration study and~~ the Phase 2 B-ALL and B-NHL registration ~~study of CNCT19~~studies are both currently enrolling in China.

●

~~BI-1206~~ is an antibody which has a novel mode-of-action, blocking the inhibitory antibody checkpoint receptor FcγRIIB to unlock anti-cancer immunity in both hematological malignancies and solid tumors for whichIn October 2020, the Company ~~has licensed~~entered into an exclusive ~~greater China rights from~~licensing agreement with BioInvent International AB (“BioInvent”). for the development and commercialization of novel anti-FcγRIIB antibody, BI-1206, in mainland China, Taiwan, Hong Kong and Macau. BioInvent is a biotechnology company focused on the discovery and development of first-in-class immune-modulatory antibodies for cancer immunotherapy. BI-1206 is being investigated ~~by BioInvent~~ in a Phase 1/2 trial, in combination with anti-PD1 therapy Keytruda^® (pembrolizumab), in patients with solid tumors, and in a Phase 1/2a trial in combination with MabThera^® (rituximab) in patients with relapsed/refractory non-Hodgkin lymphoma (NHL). The CASI Clinical Trial Application (CTA) was approved by China National Medical Products Administration (NMPA) in December 2021 and ethics committee approvals have been received in January of 2022. The Company obtained approval from Human Genetic Resources Administration of China (“HGRAC”) in April 2022. The Company is planning a Phase 1 study of BI-1206 ~~restores activity of~~in combination with rituximab with a single agent BI-1206 run in phase in patients with ~~relapsed/refractory non-Hodgkin’s lymphoma.~~NHL (mantle cell lymphoma, marginal zone lymphoma, and follicular lymphoma) to assess PK, safety and tolerability, select the Recommended Phase 2 Dose and assess early signs of clinical efficacy as part of its development program for BI-1206 in China. The study is expected to start in the second quarter of 2022 with the first-patient-in in the third quarter of 2022.

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CB-5339 is a novel VCP/p97 inhibitor focused on valosin-containing protein (VCP)/p97 as a novel target in protein homeostasis, DNA damage response and other cellular stress pathways for therapeutic use in ~~cancer. The Company~~the treatment of patients with various malignancies. We entered into an exclusive license inon March 21, 2021 with Cleave Therapeutics, Inc. ~~(Cleave”~~(“Cleave”) for the development and commercialization of CB-5339 in Mainland China, Hong Kong, Macau and ~~Taiwan~~.Taiwan. CB-5339, an oral second-generation, small molecule VCP/p97 inhibitor, is being evaluated in a Phase 1 clinical trial in patients with acute myeloid leukemia (AML) and myelodysplastic syndrome (MDS). CB-5339 CTA application for the multiple myeloma indication has been submitted in March 2022 to the China Center of Drug Evaluation (“CDE”).

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CID-103 is a full human IgG1 anti-CD38 monoclonal antibody recognizing a unique epitope that has demonstrated encouraging preclinical efficacy and safety profile compared to other anti-CD38 monoclonal antibodies for which ~~the Company has~~we have exclusive global rights. CID-103 is being developed for the treatment of patients with multiple myeloma. The ~~Company achieved in June 2021 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.~~myeloma is ongoing in France and the UK.

~~The Company~~We also ~~has~~have greater China rights to ~~ZEVALIN~~^® ~~(Ibritumomab Tiuxetan)~~Octreotide (Long Acting Injectable), a ~~CD20-directed radiotherapeutic antibody that is approved in the U.S. to treat patients with non-Hodgkin lymphoma (“NHL”) and MARQIBO~~^® ~~(vincristine sulfate LIPOSOME injection) a novel, sphingomyelin/cholesterol liposome-encapsulated, formulation~~standard of ~~vincristine sulfate, a microtubule inhibitor, approved by the FDA~~care for the treatment of ~~adult patients~~acromegaly and for the control of symptoms associated with ~~Philadelphia chromosome-negative (Ph-) acute lymphoblastic leukemia (ALL)~~certain neuroendocrine tumors; and Thiotepa, a cytotoxic agent which has a long history of established use in ~~second or greater relapse or whose disease~~the hematology/oncology setting, we have an exclusive China license and distribution rights to a novel formulation of thiotepa, which has ~~progressed following two or more anti-leukemia therapies.~~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~~our commitment to prioritize resources, ~~the Company is~~we are currently evaluating ~~its options~~our potential opportunities for these products. In addition, ~~the Company’s~~our assets include ~~a few~~six FDA-approved ANDAs which ~~the Company is~~we are evaluating due to generic drug pricing reforms by the Chinese government and its impact on the pricing and competitiveness of these products.

~~The Company’s~~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 ~~its~~our hematology/oncology franchise. ~~In many cases its business development~~

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strategy includes direct equity investments in the licensor company. The Company intends for its pipeline to reflect a diversified and risk-balanced set of assets that include (1) late-stage clinical drug candidates in-licensed for China regional rights, (2) proprietary or licensed innovative drug candidates, and (3) select high quality pharmaceuticals that fit its therapeutic focus. The Company usesWe use a market-oriented approach to identify pharmaceutical/biotechnology candidates that ~~the Company believes~~we 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’s~~our global drug development strategy. In many cases our 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 ~~its~~our principal clinical and commercial target, ~~the Company is~~we are opportunistic about other therapeutic areas that can address unmet medical needs.

~~CASI has built an integrated biopharmaceutical company dedicated to the successful development and commercialization of innovative and other therapeutic products. The Company~~ We will continue to pursue building a robust pipeline of drug candidates for development and commercialization in China as our primary market, and if rights are available for the rest of the world. For in-licensed products, we use a market-oriented approach to identify pharmaceutical/biotechnology candidates that we believe have the potential for gaining widespread market acceptance, either globally or in China, and for which development can be accelerated under our drug development strategy. 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. 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. In many cases our business development strategy includes direct equity investments in the licensor company.

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 that facilitate the entry of new pharmaceutical products into the country. We will continue 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 maximize regulatory, development and clinical strategies in both countries.

~~In 2012,~~Our commercial product, EVOMELA^®, was originally licensed from Spectrum Pharmaceuticals, Inc. (“Spectrum”) and we had a supply agreement with ~~new leadership,~~Spectrum to support our application for import drug registration and for commercialization purposes. Spectrum completed the ~~Company shifted~~sale of its ~~business strategy~~portfolio of FDA-approved hematology/oncology products including EVOMELA^® 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.”Acrotech Biopharma L.L.C. (“Acrotech”) on March 1, 2019. The ~~majority of the Company’s operations are now located in China. The Company expects~~original supply agreement with Spectrum was assumed by Acrotech; Spectrum agreed to continue ~~to incur operating losses~~with a short-term supply agreement for EVOMELA^® for the ~~foreseeable future due to, among other factors, its continuing clinical and development activities and expansion of our operations. Our operations~~initial commercial product supply in China are conducted primarily through two of our subsidiaries, CASI Pharmaceuticals (China) Co., Ltd. (“CASI China”) and CASI Pharmaceuticals (Wuxi) Co., Ltd. (“CASI Wuxi”). 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 isconnection with the launch, with the long-term supply assumed by Acrotech.

As part of the long-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.

~~Taking~~In November 2019, CASI Wuxi entered into ~~consideration~~a fifty-year lease agreement for the ~~cash~~right to use state-owned land in China for the construction of a GMP manufacturing facility. Pursuant to the agreement, CASI Wuxi has committed to invest land use right and ~~cash equivalents balance~~property, plant and equipment of RMB1 billion (equivalent to $143 million) by August 2022. In April 2020, CASI Wuxi received RMB 15.9 million (equivalent to $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 design and construction work of ~~September 30, 2021,~~the land, CASI Wuxi entered into several contracts for RMB 76.1 million ($12.0 million) to complete the phase 1 project of CASI

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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, and the development plan will be extended, details regarding the plan are under negotiation. Also in 2020, CASI Wuxi entered in to a lease agreement with local government for a manufactory building next to the leased land. Since then, the Company ~~believes that it has sufficient resources~~entered into a series of contracts for the remodeling and installation work of the building and warehouse, as well as purchase of equipment. The total contract amount entered into for this building is approximately RMB 92.1 million ($14.5 million).

During the peak of the COVID-19 pandemic in 2020, we experienced disruptions to ~~fund its operations at least one year beyond~~ the ~~date that~~EVOMELA^® marketing and sales activities as well as to the ~~unaudited condensed consolidated financial statements are issued. As~~supply chain for EVOMELA^®. The COVID-19 pandemic also impacted our targeted start time of ~~September 30,~~our CID-103 trial due to the lock down of many medical facilities in Europe. During 2021 and the ~~Company had a consolidated cash balance~~first quarter of ~~$53.1 million. The Company intends~~2022, we have experienced minimal disruption to ~~continue to exercise tight controls over operating expenditures and will continue to pursue opportunities, as required, to raise additional capital and will also actively pursue non-~~our business activities or ~~less-dilutive capital raising arrangements.~~

~~Impact of COVID-19~~

~~The Company has experienced operational interruptions~~supply chain as a result of the COVID-19 ~~including~~pandemic. However, since the ~~temporary disruption~~second quarter of ~~operations~~2022, the COVID-19 related lock down and associated restrictions in certain areas in China ~~during 2020 due~~led to the shutdown of local hospitals, which had a ~~Chinese government mandated quarantine protocol, including mandatory business closures, social distancing measures,~~negative impact on the sales of our products for the second quarter, and ~~various travel restrictions. Although~~is expected to have negative impacts on the ~~Company's operations in China have normalized, there can be no assurance~~same for the whole year. The restrictions also adversely impacted the enrolling of patients for the CNCT19 Phase II studies. Given that such ~~operations will~~restriction measurement is beyond our control, we are unable to, at this stage, assess for how long such measurement may continue and the full extent to which such measurement may directly and indirectly impact our business operations.

We currently rely on a single source for the supply of EVOMELA^®. The continuation of the COVID-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 ~~do so~~commercialize and expand distribution of EVOMELA^® could be adversely affected if the supplier refuses or is unable to provide products for any reason (including the occurrence of an event like the COVID-19 pandemic that ~~there will not be~~makes delivery impractical). We would have to work with Acrotech to negotiate an agreement with a ~~renewed outbreak~~substitute supplier, which, assuming a substitute supplier was available, would likely interrupt the manufacturing of ~~COVID-19 due to new variants of the virus or other significant contagious diseases in China or elsewhere. To the extent that such events occur, demand for the Company's products may decline,~~EVOMELA^®, cause supply chain delays and the Chinese government or other governments may impose additional restrictions resulting in further shutdowns, further work restrictions, and the disruption of the Company’s supply and distribution channels.increase costs.

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recessions that could affect ~~the Company's~~our ability to continue to commercialize and expand distribution of EVOMELA^® (Melphalan For Injection) or other drugs in ~~the Company’s~~our existing product pipeline. ~~The effectiveness of~~Early in the ~~Company's sales teams may be negatively impacted by the lack of travel~~COVID-19 pandemic, we experienced a disruption to our supply chain for EVOMELA®, we have experienced no supply disruption in 2021 and ~~their reduced ability to engage with decision-makers. In~~ the first quarter ~~2020, during which the peak~~ of ~~the pandemic occurred in China, the Company experienced some disruptions to their EVOMELA~~^® marketing and sales activities due to travel restrictions and the prioritization of hospitals and physicians to attend to patients with COVID-19 infection. During the remainder of 2020, operations returned to expected levels;2022; however, there can be no assurance that ~~such~~ restrictions will not be imposed again. In addition, economic and other uncertainties may adversely affect other ~~parties'~~parties’ willingness to negotiate and execute product licenses and thus hamper ~~the Company's~~our ability to in-license clinical-stage and late-stage drug candidates in China or elsewhere.

~~The Company currently relies on a single source for its supply of EVOMELA~~^®. If the supplier refuses or is unable to provide products for any reason (including the occurrence of an event like the COVID-19 pandemic that makes delivery impractical), the Company would be required to negotiate an agreement with a substitute supplier, which, assuming a substitute supplier was available, would likely interrupt the manufacturing of EVOMELA^®~~, cause delays and increase costs.~~

The COVID-19 pandemic impacted our targeted start time of our CID-103 trial due to the lock down of many medical facilities in Europe. Nevertheless, the Company achieved in June 2021, 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 safety, tolerability, pharmacology and clinical activity of CID-103. As the pandemic continues to unfold, the extent of the pandemic’s effect on our operations will depend in large part on future developments, which cannot be predicted with confidence at this time.

RESULTS OF OPERATIONS

Three months ended ~~September 30, 2021~~March 31, 2022 Compared with Three months ended ~~September 30, 2020~~March 31, 2021

Operating Items

Revenues

Product Sales

~~Revenues~~Product sales consist of ~~product~~ sales of EVOMELA^® that launched during August 2019. Revenue was ~~$8.1~~$9.0 million for the three months ended ~~September 30, 2021~~March 31, 2022 compared to ~~$4.2~~$5.7 million for the three months ended ~~September 30, 2020.~~March 31, 2021. Revenues increased by ~~92%~~58% in the ~~third~~first quarter of ~~2021~~2022 as compared to same quarter in ~~2020~~2021 due to the continued growth in EVOMELA^® sales.

Lease Income

Lease income consists primarily of an equipment lease with Juventas (a related party). Lease income was $37,000 and $36,000, respectively, for the three months ended ~~September 30, 2021~~March 31, 2022 and ~~the three months period ended September 30, 2020.~~2021.

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Operating Expenses

Cost of Revenues

Cost 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 ~~$3.4~~$3.8 million for the three months ended ~~September 30, 2021~~March 31, 2022 compared to ~~$1.8~~$2.4 million for the three months ended ~~September 30, 2020,~~March 31, 2021, which ~~includes~~included royalty of ~~$1.6~~$1.8 million and ~~$0.8~~$1.1 million for the same period. Costs of revenues excluding royalty were ~~$1.8~~$2.0 million and ~~$1.0~~$1.2 million for the three months ended ~~September 30, 2021~~March 31, 2022 and ~~2020.~~2021. Costs of revenues excluding royalty as a percentage of revenues were ~~23%~~22% in the three months ended ~~September 30, 2021 compared to 24%~~March 31, 2022, which was consistent with that in the ~~three months ended September 30, 2020.~~ prior year period.

Research and Development Expenses

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 drug substance and drug product, regulatory maintenance costs of ANDAs, facilities expenses, and amortization expense of acquired ANDAs.

Research and development expenses for the three months ended ~~September 30, 2021~~March 31, 2022 were ~~$2.9~~$4.0 million, compared with ~~$2.8~~$5.3 million for the three months ended ~~September 30, 2020.~~

~~Included in our research and development expenses~~March 31, 2021. The decrease was mainly due to decreased expense incurred for the three months ended September 30, 2021 are direct project costs of $0.8 million for preclinical development activities primarily related to our CID-103 program compared to $1.1 million for the three months ended September 30, 2020, $0.5 million amortization and filing fees related to our ANDAs acquired in 2018 compared to $0.9 million for the three months ended September 30, 2020, and $0.5 million for drugs in-licensed from Acrotech (previously Spectrum) compared to $0.8 million for the three months ended September 30, 2020. CID-103.

General and Administrative 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 for the three months ended ~~September 30, 2021 and the three months ended September 30, 2020~~March 31, 2022 were $5.3 ~~million.~~million, which remained consistent compared to $5.5 million in the prior year period.

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, ~~bonus,~~bonuses, advertising, and other marketing efforts.

Selling and marketing expenses for the three months ended ~~September 30, 2021~~March 31, 2022 were ~~$3.4~~$3.3 million, compared with ~~$2.1~~$2.7 million for the three months ended ~~September 30, 2020.~~March 31, 2021. The increase in selling and marketing expenses was due to the increase of sales commission in accordance with the increase in sales of EVOMELA^® and expansion of sales team in ~~China in 2021 and the increase of travel cost due to recovery from the COVID-19 in 2021.~~China.

Acquired in-process Research and Development

There were no acquired in-process R&D expenses for the three months ended ~~September 30, 2021.~~March 31, 2022. Acquired in-process R&D expenses for the three months ended ~~September 30, 2020~~March 31, 2021 was ~~$10.9~~$5.5 million related to the ~~2020 milestone fee paid~~upfront payment to ~~Pharmathen~~Cleave for the development of ~~$0.6 million, and the 2020 milestone fees paid to Juventas of $10.3 million.~~CB-5339.

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Non-Operating Items

Interest income, net

Interest income, net for the three months ended ~~September 30, 2021~~March 31, 2022 was ~~$79,000~~$74,000 compared with ~~$432,000~~$106,000 for the three months ended ~~September 30, 2020. The decrease in interest income, net, is mainly due to the amount reported for three months ended September 30, 2020 included interest income~~March 31, 2021.

Table of ~~$351,000 from loans made to Juventas (a related party).~~Contents

Other income

Other income for the three months ended ~~September 30, 2021~~March 31, 2022 was ~~$487,000~~$38,000 compared with $20,000 for the three months ended ~~September 30, 2020.~~March 31, 2021. Other ~~incomes of $12,000 and $12,000 recorded in the three months ended September 30, 2021 and 2020, respectively,~~income was recognized mainly relate to the ~~April 2020 CASI Wuxi’s receipt of RMB 15.9 million (equivalent to $2.2 million)~~government grant from the Jiangsu Province Wuxi Huishan Economic Development Zone ~~as government grant~~ for the development of leased state-owned land in ~~China~~Wuxi for the construction of a manufacturing facility. The grant was recorded as deferred income ~~in April 2020. The grant~~upon receipt and is ~~been~~being amortized over the term of the lease of the land. ~~Other incomes of $471,807 recorded in the three months ended September 30, 2021 relates to the loan to the Company under the Paycheck Protection Program (PPP) that was forgiven in September 2021.~~

Foreign exchange ~~losses~~gains

Foreign exchange ~~losses~~gains for the three months ended ~~September 30, 2021~~March 31, 2022 were ~~$6,000~~$0.3 million compared with ~~losses~~gains of ~~$526,000~~$0.2 million for the three months ended ~~September 30, 2020.~~March 31, 2021. The foreign exchange ~~losses~~gains are primarily due to accounts receivable with ~~CRGK.~~CRPCGIT and USD denominated cash accounts that are held by our Chinese subsidiaries.

Change in fair value of investments

The changes in fair value of investments for the three months ended ~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~ were losses of ~~$3,687,000~~$1.6 million and gains of ~~$1,978,000,~~$1.6 million, respectively. The changes represent unrealized gains or losses on the Company’s investments in equity securities and long-term ~~investment.~~

~~Nine months ended September 30, 2021 Compared with Nine months ended September 30, 2020~~

~~Operating Items~~

~~Revenues~~

~~Product Sales~~

~~Revenues consist of product sales of EVOMELA~~^® that launched during August 2019. Revenue was $20.9 million for the nine months ended September 30, 2021 compared to $10.2 million for the nine months ended September 30, 2020. Revenues increased by 105% in the first nine months of 2021 as compared to same period in 2020investments. The changes were due to the ~~continued growth~~fluctuations in ~~EVOMELA~~^® ~~sales.~~

~~Lease Income~~

~~Lease income consists primarily~~the market price of ~~an equipment lease with Juventas (a related party). Lease income was $110,000~~two publicly traded companies invested by us for the ~~nine months ended September 30, 2021 compared to $104,000 for the nine months period ended September 30, 2020.~~two periods.

~~Operating Expenses~~

~~Cost of Revenues~~

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

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Costs of revenues were $8.8 million for the nine months ended September 30, 2021 compared to $7.6 million for the nine months ended September 30, 2020, which includes royalty of $4.1 million and $2.0 million for the same period. Costs of revenues excluding royalty were $4.6 million and $5.5 million for the nine months ended September 30, 2021 and 2020. Costs of revenues excluding royalty as a percentage of revenues decreased from 54% in the nine months ended September 30, 2020 to 22% in the nine months ended September 30, 2021, due to the new alternate manufacturer now in place, resulting in a considerable decrease in the unit cost of inventories of EVOMELA^®.

~~Research and Development Expenses~~

Research and development expenses for the nine months ended September 30, 2021 were $10.4 million, compared with $7.7 million for the nine months ended September 30, 2020. The increases in R&D expenses are primarily due to an increase in R&D expenses incurred related to the development of CID-103.

Included in our research and development expenses for the nine months ended September 30, 2021 are direct project costs of $5.0 million for preclinical development activities, primarily related to our CID-103 program compared to $2.9 million for the nine months ended September 30, 2020, $1.5 million amortization and filing fees related to our ANDAs acquired in 2018 compared to $1.9 million for the nine months ended September 30, 2020, and $1.2 million for drugs in-licensed from Acrotech (previously Spectrum) compared to $1.5 million for the nine months ended September 30, 2020.

~~General and Administrative Expenses~~

General and administrative expenses for the nine months ended September 30, 2021 were $16.2 million, compared with $13.5 million for the nine months ended September 30, 2020. The increase in general and administrative expenses was primarily due to an increase in professional fees.

~~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, bonus, advertising, and other marketing efforts.~~

Selling and marketing expenses for the nine months ended September 30, 2021 were $9.5 million, compared with $4.9 million for the nine months ended September 30, 2020. The increase in selling and marketing expenses was due to expansion of sales team in China and the increase of travel cost due to recovery from COVID-19 in 2021.

~~Loss on disposal of property, plant and equipment~~

~~Loss on disposal of property, plant and equipment for the nine months ended September 30, 2020 was $65,000, compared to $0~~ ~~for the nine months ended September 30, 2020~~ . ~~The loss on disposal is due to the sale of lab equipments in the period.~~

~~Gain on disposal of intangible assets~~

~~There was no gain (loss) on disposal of intangible assets for the nine months ended September 30, 2021.~~

~~Gain on disposal of intangible assets for the nine months ended September 30, 2020 was $0.5 million.~~ ~~The gain on disposal is due to the $0.5 million gain on the sale of seven ANDAs during the first quarter of 2020.~~

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~~Impairment of intangible assets~~

~~There was no impairment of intangible assets for the nine months ended September 30, 2021. Impairment of intangible assets for the nine months ended September 30, 2020 was $1.5 million.~~

~~Acquired in-process Research and Development~~

Acquired in-process R&D expenses for the nine months ended September 30, 2021 was $6.6 million, compared to $11.9 million for the nine months ended September 30, 2020. The amount reported for the nine months ended September 30, 2021 was the upfront payment of $5.5 million to Cleave for the development of CB-5339 and milestone payments of $1.06 million for the development of CID-103. The amount reported for the nine months ended September 30, 2020 related to the two 2020 milestone fees paid to Pharmathen of $1.7 million, and the 2020 milestone fees paid to Juventas of $10.3 million.

~~Non-Operating Items~~

~~Interest income, net~~

Interest income, net for the nine months ended September 30, 2021 was $261,000 compared with $775,000 for the nine months ended September 30, 2020. The decrease in interest income, net, is mainly because to the amount reported for nine months ended September 30, 2020 included interest income of $375,000 from loans made to Juventas (a related party).

~~Other income~~

Other income for the nine months ended September 30, 2021 was $540,000 compared with $47,000 for the nine months ended September 30, 2020. Other incomes of $37,000 and $23,000, recorded in the nine months ended September 30, 2021 and 2020, relate to the April 2020 CASI Wuxi’s receipt of RMB 15.9 million (equivalent to $2.2 million) 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 grant was recorded as deferred income in April 2020. The grant is been amortized over the term of the lease of the land. Other incomes of $471,807 recorded in the three months ended September 30, 2021 relates to the loan to the Company under the Paycheck Protection Program (PPP) that was forgiven in September 2021.

~~Foreign exchange gains (losses)~~

Foreign exchange gains for the nine months ended September 30, 2021 were $289,000 compared with losses of $278,000 for the nine months ended September 30, 2020. The foreign exchange gains (losses) are primarily due to accounts receivable with CRGK.

~~Change in fair value of investments~~

The changes in fair value of investments for the nine months ended September 30, 2021 and 2020 were losses of $205,000 and gains of $2,287,000, respectively. The changes represent unrealized gains or losses on the Company’s investments in equity securities and long-term investment.

~~Impairment loss of long-term investments~~

Impairment loss of long-term investments for the nine months ended September 30, 2021 was $865,000 relating to the investment in Black Belt Tx. The Company did not record any impairment loss of long-term investments during the nine months ended September 30, 2020.

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LIQUIDITY AND CAPITAL RESOURCES

To date, ~~we have~~the Company has been engaged primarily in research and development activities. As a result, ~~we have~~the Company has incurred and expect to continue to incur operating losses ~~for~~in 2022 and the foreseeable future. ~~Based on our current plans, we expect our current available cash and cash equivalents to meet our cash requirements for at least through November 12, 2022.~~

WeThe Company will require significant additional funding to fund operations beyond the second quarter of 2023 until such time, if ever, ~~we become~~it becomes profitable. ~~We intend~~The Company intends to augment ~~our~~its 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 ~~our~~its capabilities and products in order to continue the development of ~~our~~its potential product candidates that wethey intend to pursue to commercialization. If ~~we seek~~the 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 ~~our~~its existing product candidates, or products wethey would otherwise seek to develop or commercialize on ~~our~~its own, or to license the rights to ~~our~~its product candidates on terms that are not favorable to ~~us.~~it.

WeThe Company will also continuously invest in its development of the Wuxi land and construction of the manufacturing building. Commencing from the fourth quarter of 2020, in relation to the development of the Wuxi land and construction of the manufacturing building, the Company entered into a series of contracts for the development and construction work. Total commitment under these contracts was RMB 64.2 million ($10.1 million) as of March 31, 2022.

The Company will continue to seek to raise additional capital to fund ~~our~~its commercialization efforts, expansion of ~~our~~its operations, capital expenditure, research and development, and for the acquisition of new product candidates, if any. ~~We intend~~The Company intends to and is currently actively communicating to explore one or more of the following alternatives to raise additional capital:

●

~~selling additional equity securities;~~raising bank loans;

●

selling ~~debt securities or entering into borrowing arrangements;~~additional equity securities;

●

out-licensing product candidates to one or more corporate partners;

●

completing an outright sale of non-priority assets; and/or

●

engaging in one or more strategic transactions.

WeThe Company also will continue to manage ~~our~~its cash resources prudently and cost-effectively.

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There can be no assurance that adequate additional financing under such arrangements will be available to usthe Company on terms that wethey deem acceptable, if at all. If additional funds are raised by issuing equity securities, dilution to existing stockholders may result, or the equity securities may have rights, preferences, or privileges senior to those of the holders of ~~our~~its common stock. If wethey fail to obtain additional capital when needed, wethey may be required to delay or scale back ~~our~~their commercialization efforts, ~~our~~ advancement of the Spectrum products, and the ANDA products, or plans for other product candidates, if any.

Since its inception in 1991, the Company has incurred significant losses from operations and, as of March 31, 2022, has incurred an accumulated deficit of $613.6 million. As of ~~September 30, 2021, we had cash and cash equivalents of $53.1 million, with working capital of $62.0 million.~~March 31, 2022, the Company believes that it has sufficient resources to fund its operations at least one year beyond the date that the interim consolidated financial statements are issued.

FINANCING ACTIVITIES

Stock Repurchase Program

On December 15, 2021, our board of directors approved a stock repurchase program for the repurchase of up to $10 million of our common stock (and no more than 12,500,000 shares of the our common stock) through open market purchases in compliance with Rule 10b-18 under the Securities Exchange Act of 1934 and through trading plans established pursuant to Rule 10b5-1 of the Securities Exchange Act. The trading plan was terminated on March 31, 2022, and as of March 31, 2022, we have repurchased 3,734,992 shares of common stock amounted to $3.0 million.

March 2021 Underwritten Public Offering

The Offering was made by means of a written prospectus supplement and accompanying prospectus forming part of a shelf registration statement on Form S-3, previously filed with the SEC on November 20, 2020, which was declared effective on December 2, 2020. We have filed a final prospectus supplement, dated March 24, 2021, with the SEC relating to the ~~Offering.~~Offering.

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~~Sales Agreements~~

~~On February 23, 2018, the Company entered into a~~ Common Stock Sales Agreement (the “Sales Agreement”), as amended, with H.C. Wainwright & Co., LLC (“HCW”) that would allow the Company to sell up to $20 million of shares of common stock in “at-the-market” transactions, subject to compliance with the terms and conditions of the Sales Agreement.Agreements

On July 19, 2019, the Company entered into an Open Market Sale ~~Agreement~~^SMAgreementSM with Jefferies LLC, as sales agent (the “Open Market Agreement”), pursuant to which the Company may elect to sell from time to time, at its option, up to $30 million in shares of the Company’s common stock, ~~through Jefferies LLC, as sales agent.~~

subject to the terms and conditions of the Open Market Agreement. During the ~~nine~~three months ended September 30, 2021, the Company has not offered and sold any shares of common stock under the Sales Agreement, and a total of 143,248 shares, resulting in net proceeds to the Company of $475,000 have been issued since inception.

~~During the nine months ended September 30, 2021,~~March 31, 2022, the Company has not offered and sold any shares of common stock under the Open Market ~~Agreement, and a total~~Agreement. As of March 31, 2022, the Company had issued 493,000 shares ~~resulting in~~with net proceeds toof $1.5 million, with remained $28.5 million available under the ~~Company of $1,539,000, have been issued since inception.~~Open Market Agreement.

On October 29, 2021, the Company has entered into a common stock sales agreement (“~~stock sales agreement”~~Stock Sales Agreement”), with H.C. Wainwright & Co., LLC, ~~(“Wainwright”),~~ relating to shares of common stock of the ~~Company, $0.01 par value per share.~~Company. In accordance with the terms of the sales agreement, the Company may offer and sell shares of common stock ~~having~~in “at-the-market” transactions, subject to compliance with the terms and conditions of the Stock Sales Agreement, with an aggregate offering price of not more than $20,000,000.

~~For~~ As of March 31, 2022, the ~~nine months ended September 30, 2021, no~~Company has not offered or sold any shares ~~were issued~~of common stock under ~~either~~ the ~~Sales Agreement or the Open Market Agreement.~~sales agreement.

INTEREST RATE CHANGES

Management does not believe that our working capital needs are sensitive to changes in interest rates.

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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

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.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

Based on an evaluation under the supervision and with the participation of ~~the Company’s~~our management, ~~the Company’s~~our Chief Executive Officer and ~~President/~~Principal Financial Officer have concluded that ~~the Company’s~~our disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) were effective as of ~~September 30, 2021~~March 31, 2022 to ensure that information required to be disclosed by ~~the Company~~us in reports that ~~it files~~we file or ~~submits~~submit under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission rules and forms and (ii) accumulated and communicated to ~~the Company’s~~our management, including ~~its~~our Chief Executive Officer and ~~President/~~Principal Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

We believe that a controls system, no matter how well designed and operated, cannot provide absolute assurance that the objectives of the controls system are met, and no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within a company have been detected.

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Changes in Internal Control Over Financial Reporting

There have not been any changes in ~~the Company’s~~our internal control over financial reporting during the quarter ended ~~September 30, 2021~~March 31, 2022 that have materially affected, or are reasonably likely to materially affect, ~~the Company’s~~our internal control over financial reporting.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

We are 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.

ITEM 1A. RISK FACTORS

For information regarding factors that could affect the Company’s results of operations, financial condition and liquidity, see the risk factors discussion set forth in Item 1A of CASI’s Annual Report on Form 10-K for the fiscal year ended December 31, ~~2020~~2021 and the information under “Special Note Regarding Forward-Looking Statements” included in this report. ~~There~~Other than disclosed herein, there have been no material changes to our risk factors from those disclosed in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021.

Risk Relating to Our Auditor

Our ADSs will be prohibited from trading in the United States under the Holding Foreign Companies Accountable Act, or the HFCAA, in 2024 if the PCAOB is unable to inspect or fully investigate auditors located in China, or in 2023 if proposed changes to the law are enacted. The delisting of our ADSs, or the threat of their being delisted, may materially and adversely affect the value of your investment.

The Holding Foreign Companies Accountable Act, or the HFCAA, was signed into law on December 18, 2020. The HFCAA states if the SEC determines that we have filed audit reports issued by a registered public accounting firm that has not been subject to inspection for the PCAOB for three consecutive years beginning in 2021, the SEC shall prohibit our shares or ADSs from being traded on a national securities exchange or in the over-the-counter trading market in the United States. On December 2, 2021, the SEC adopted final amendments implementing the disclosure and submission requirements of the HFCAA, pursuant to which the SEC will identify an issuer as a “Commission Identified Issuer” if the issuer has filed an annual report containing an audit report issued by a registered public

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accounting firm that the PCAOB has determined it is unable to inspect or investigate completely, and will then impose a trading prohibition on an issuer after it is identified as a Commission-Identified Issuer for three consecutive years. On December 16, 2021, the PCAOB issued a report to notify the SEC of its determination that the PCAOB is unable to inspect or investigate completely registered public accounting firms headquartered in mainland China and Hong Kong. The PCAOB identified our auditor as one of the registered public accounting firms that the PCAOB is unable to inspect or investigate completely. We have been identified by the SEC as a “Commission Identified Issuer” after the filing of our annual report on 10-K for the fiscal year ended December 31, 2021.

Whether the PCAOB will be able to conduct inspections of our auditor before the issuance of our financial statements on Form 20-F for the year ending December 31, 2023 which is due by April 30, 2024, or at all, is subject to substantial uncertainty and depends on a number of factors out of our, and our auditor’s, control. If our shares and ADSs are prohibited from trading in the United States, there is no certainty that we will be able to list on a non-U.S. exchange or that a market for our shares will develop outside of the United States. Such a prohibition would substantially impair your ability to sell or purchase our ADSs when you wish to do so, and the risk and uncertainty associated with delisting would have a negative impact on the price of our ADSs. Also, such a prohibition 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.

On June 22, 2021, the U.S. Senate passed a bill which would reduce the number of consecutive non-inspection years required for triggering the prohibitions under the HFCAA from three years to two. On February 4, 2022, the U.S. House of Representatives passed a bill which contained, among other things, an identical provision. If this provision is enacted into law and the number of consecutive non-inspection years required for triggering the prohibitions under the HFCAA is reduced from three years to two, then our shares and ADSs could be prohibited from trading in the United States in 2023.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

Not applicable.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION

Not applicable.

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ITEM 6. EXHIBITS

EXHIBIT INDEX


31.1		Rule 13a-14(a) Certification of Chief Executive Officer**
31.2		Rule 13a-14(a) Certification of Principal Financial Officer**
32.1		Section 1350 Certification of Chief Executive Officer**
32.2		Section 1350 Certification of Principal Financial Officer**
101.INS		Inline XBRL Instance Document. The instance document does not appear in the interactive data file because its XBRL tags are embedded within the inline XBRL document.**
101.SCH		Inline XBRL Taxonomy Extension Schema Document.**
101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document.**
101.DEF		Inline XBRL Taxonomy Extension Definition Linkbase Document.**
101.LAB		Inline XBRL Taxonomy Extension Label Linkbase Document.**
101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document.**
104		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101 filed herewith).

*Management Contract or any compensatory plan, contract or arrangement

**Filed Herewith

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


		CASI PHARMACEUTICALS, INC.
		(Registrant)


Date: ~~November~~May 12, ~~2021~~2022		/s/ Wei-Wu He
		Wei-Wu He
		Chief Executive Officer


Date: ~~November~~May 12, ~~2021~~2022		/s/ Larry (Wei) Zhang
		Larry (Wei) Zhang
		Principal Financial Officer

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(In thousands)
Asset	Purchase Price		Accumulated Amortization		Estimated useful lives
ANDAs	$	15,832		(3,540)	13 years
Others		197		(131)	5 years
Total	$	16,029	$	(3,671)


(In thousands)
Balance as of December 31, 2020	$	13,210
Amortization expense		(1,009)
Foreign currency translation adjustment		157
Balance as of September 30, 2021	$	12,358


		Weighted Average
	Number of Options	Exercise Price
Outstanding at December 31, 2020	16,746,238	$	2.71
Exercised	0	$	0
Granted	15,989,552	$	1.57
Expired	(343,750)	$	4.76
Forfeited	(1,035,000)	$	2.65
Cancelled	0	$	0
Outstanding at September 30, 2021	31,357,040	$	2.11
Vested and expected to vest at September 30, 2021	31,357,040	$	2.11
Exercisable at September 30, 2021	14,110,876	$	2.54