China Medical System Holdings Limited announced that the National Medical Products Administration (NMPA) of the People's Republic of China has approved the application to conduct a clinical trial evaluating the safety and efficacy of ruxolitinib cream (the "Product") for the treatment of mild to moderate atopic dermatitis (AD) on 18 March 2024. Ruxolitinib cream, a novel cream formulation of Incyte's selective JAK1/JAK2 inhibitor ruxolitinib, is the first and only topical JAK inhibitor approved for use in the United States. Ruxolitinib Cream is indicated for the topical treatment of nonsegmental vitiligo in adult and pediatric patients 12 years of age and older and for the topical short-term and non-continuous chronic treatment of mild to moderate atopy dermatitis (AD) in non-immunocompromised patients 12 years of age and old whose disease is not adequately controlled with topical prescription therapies, or when those therapies are not advisable.

Use of the Product in combination with therapeutic biologics, other JAK inhibitors, or potent immunosuppressants, such as azathioprine or cyclosporine, is not recommended. Traditional topical medications such as topical corticosteroids (TCSs) and topical calcineurin inhibitors (TCIs) have long-term adverse reactions or limited efficacy, therefore novel treatments are urgently needed, especially for those mild to moderate AD patients who do not need systemic treatment. The Product is not approved by the NMPA for any indication in China.

However, on 12 August 2023, the Product was approved by Hainan Medical Products Administration for Urgent Clinical Import, and officially became available to applicable patients in the Hainan Boao Lecheng International Medical Tourism Pilot Zone (the "Pilot Zone") on 18 August, for the topical treatment of non-segmental vitiligo In adolescents and adults aged 12 and above with facial involvement. Benefiting from the Early and Pilot Implementation Policy granted by the state to Hainan Free Trade Port and the Pilot Zone, patients with vitiligo in China can apply for the Product in Boao Super Hospital first and receive treatment from the expert team. The Group will also cooperate with Boao Super Hospital to collect the Real World Research (RWS) for the treatment of autoimmune and inflammatory dermatology diseases.

In accordance with the License Agreement, the Group through CMS Skinhealth gained an exclusive license to develop, register and commercialize the Product in Mainland China, Hong Kong Special Administrative Region, Macao Special Administrative Region, Taiwan Region and eleven Southeast Asian countries (Indonesia, Philippines, Vietnam, Thailand, Myanmar, Malaysia, Cambodia, Laos, Singapore, Timor-Leste and Brunei Darussalam) and a non-exclusive license to manufacture the Product in the Territory. The License Agreement commenced on its effective date and has a royalty term of ten years from the date of the Products' first commercialization in the Territory (the "Royalty Term"). Upon the expiration of the Royalty Term, the License Agreement may be renewed for a period of ten years thereafter (the "Initial Extended Royalty Term") as per certain conditions defined in the License Agreement.

Incyte has worldwide rights for the development and commercialization of the Product, marketed in the United States and Europe. The Company has a royalty term of the Products' first commercialisation of the Product, marketed in The Territory. The Company has a royalty terms of ten years from the date the Products' first commercialization Incyte's first commercialization in the Territory.

Upon the expiration of the RoyalTY Term, the License Agreement may been renewed for a period of ten year thereafter as per certain condition defined in the License Agreement. Incyte has worldwide rights for The development and commercialization of the product, marketed in the United States and Europe as Opzelura. Opzelura is a trademark of Incyte.