Zai Lab Ltd

HKEX:9688

Earnings Call Transcript 2021-Q1

[Operator]

Hello, ladies and gentlemen, thank you for standing by, and welcome to Zai Lab's First Quarter 2021 Financial Results Conference Call. [Operator Instructions] As a reminder, today's call is being recorded.

It is now my pleasure to turn the floor over to Billy Cho, Chief Financial Officer of Zai Lab, who will make introductory comments.

[Ki Chul Cho, executive]

Good morning, and welcome to Zai Lab's First Quarter 2021 Financial Results and Corporate Update Conference Call. Earlier this morning, Zai Lab issued a press release providing the details of the company's financial results for the 3 months ended March 31, 2021, as well as product highlights and corporate update. The press release is available in the Investor Relations section of the company's corporate website at ir.zailaboratory.com.

Today's call will be led by Dr. Samantha Du, Zai Lab's Founder, Chairperson and Chief Executive Officer. She will be joined by Tao Fu, Chief Strategy Officer, who will provide more details on our recent commercial and pipeline progress; Jonathan Wang, Head of Business Development; Dr. Alan Sandler, President, Head of Global Development, Oncology; and Dr. Harald Reinhart, Chief Medical Officer for Autoimmune and Infectious Diseases, we'll also be available to answer questions during the Q&A portion of the call.

As a reminder, during today's call, Zai Lab will be making certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including our business plans and objectives and timing and success of our clinical trials, regulatory applications and commercial launches. Such forward-looking statements are not guarantees of future performance, and therefore, you should not put undue reliance upon them. These statements are subject to numerous risks and uncertainties that could cause actual results to differ materially from what we expect. I refer you to our SEC filings for a discussion of risk factors that could cause our actual results to differ materially from those discussed today.

At this time, it is my pleasure to turn the call over to Zai Lab's Founder, Chairperson and Chief Executive Officer, Dr. Samantha Du.

[Ying Du, executive]

Thank you, Billy. Hello, everyone, and thank you all for joining us. On this call, I'll discuss some of the highlights from the first quarter to provide remarks as to why we believe Zai Lab's future has never been brighter. We are off to a great start this year and believe 2021 will be another strong year of execution with quality and speed that Zai Lab has been known to deliver. Therefore, to become a leading global pharmaceutical company by executing our growth strategy.

Since Zai Lab was founded in 2014, we have quickly expanded to create a portfolio of 21 innovative products across more than 30 indications. We have now commercialized the first 2 of these products in China with 4 indications. In March 2021, we gained approval for QINLOCK, our third oncology product approved within the last 15 months in China. In addition, we recently received encouraging news on several of our key assets from our customers, BLA filing for Efgartigimod in gMG was accepted by the FDA with a PDUFA date of December 17, 2021. The Phase III pivotal LUNAR trial of tumor treating fields in non-small cell lung cancers was recommended to continue with reduced sample size based on an accelerated interim analysis. Bemarituzumab was granted breakthrough therapy designation by the FDA as first-line treatment for gastric cancer patients who overexpress FGFR2b.

We now have a total of 17 products in clinical development, of which 11 are in late-stage development and 5 have already been approved in the U.S. In short, we have a broad innovative portfolio with a visible pathway to achieve significant sales within just a few years.

I also want to highlight that along with our growing platform of utilizing products, we have 7 early-stage programs with worldwide rights, including 3 in global clinical trials.

In the first quarter, Zai Lab continues to execute well with in all aspects of our business. We entered into several strategic collaborations to further strengthen our gastric and lung cancer disease strongholds; significantly bolstered our autoimmune franchise with an exclusive agreement with argenx for Efgartigimod, a true pipeline-in-a-product; advanced numerous clinical programs towards key data readouts; gained regulatory approval for QINLOCK, our third commercial product in what we expect to become a leading gastric cancer franchise.

We generated strong revenue growth with ZEJULA was added to NRDL in December of last year. The implementation started in March 2021. Although we are just setting [indiscernible], we expect to see continued strong volume growth of the ZEJULA and remain confident in our abilities to be the market share leader in China, so there's the important [indiscernible] in ovarian cancer.

With the closing of recent global public offering with gross proceeds of nearly $860 million, we significantly strengthened our capital position. This new capital will allow us to expand our pipeline through additional strategic partnerships, accelerate the clinical development of our product portfolios, scale R&D and commercial organizations to drive strong revenue growth and enhance our global pipeline.

We remain on target to advance all aspects of our platform throughout 2021. We continue to expect an NMPA approval of NUZYRA for community-acquired bacterial pneumonia and acute bacterial skin and skin structure infections. We plan to file margetuximab for HER2+ breast cancer, TTFields for mesothelioma and ZEJULA for late-line ovarian cancer in China. We're actively engaging with NMPA on a regulatory filing strategy for Efgartigimod in gMG. And we anticipate numerous data readouts, including for tumor treating fields in liver cancer and ovarian cancer, for QINLOCK in second-line GIST, for margetuximab in gastric cancer, for CLN-081 in non-small cell lung cancer and for TPX-0022 in non-small cell lung cancer and gastric cancer.

In our mission to address serious unmet medical needs for patients in China and around the world, we continue to execute on our aggressive growth strategy to create substantial value. As demonstrated by our progress in the first quarter, we remain focused as ever on achieving our mission, and our future has never been brighter.

With that, I'll now ask Tao to discuss our performance and prospects in more detail. Tao?

[Tao Fu, executive]

Thank you, Samantha. I will comment on the performance of our ongoing launches and discuss recent product highlights.

First, I'd like to touch on ZEJULA. As a reminder, ZEJULA is approved in China for first- and second-line ovarian cancer and is the only PARP inhibitor approved for all-comers in first-line. In comparison, Lynparza has a label restricting its use to patients with gBRCA mutation, which comprised only about 15% of overall patients in this study. No other PARP inhibitors have been approved for either first- or second-line.

The results of the PRIMA study conducted by GSK globally and of the NORA study sponsored by Zai in China demonstrated that an individualized starting dose regimen of ZEJULA preserved efficacy while improving the product side effect profile. This further differentiates ZEJULA from other PARP inhibitors.

This quarter, we achieved an important milestone. Our team was successful in gaining inclusion on the National Reimbursement Drug List for second-line ovarian cancer within the same year of our launch. This further underscores ZEJULA's significant clinical value for a broad range of ovarian cancer patients. The rapid NRDL inclusion provides patients much greater access, and we're already starting to see strong volume growth.

In addition, our team has also been successful in gaining coverage for commercial health insurance, with coverage currently being provided by 67 commercial health insurance plans and 52 supplemental insurance plans. We're very pleased with our launch performance so far. And over time, we believe that ZEJULA will become the leading PARP inhibitor in China.

Moving to Optune. As you recall, we launched Optune in China in the second half of 2020. The product is the first novel treatment in GBM approved by the NMPA in the last 15 years. It was highly anticipated by the medical community, and it was already recommended by the China's national glioma guideline prior to launch. With our team's efforts, Optune became the first innovative medical device supported by commercial health insurance in China, and is also covered in 13 supplemental insurance plans.

We deployed innovative strategy to support patient access and rapid uptake, including establishing 28 direct-to-patient centers in China.

Importantly, we're working with our partner, Novocure, to potentially expand the indications of tumor treating fields in areas of large unmet medical need. Additional late-stage studies are underway in tumor types potentially affecting over 1.5 million new patients a year in China, including in non-small cell lung cancer where that have been an important development.

Last month, our partner, Novocure, announced an update regarding the global Phase III pivotal LUNAR trial. After the review by an independent data monitoring committee, or DMC, Novocure was informed by the committee that the prespecified interim analysis for the LUNAR trial had been accelerated given the length of accrual and the number of events observed. The DMC further concluded that it is likely unnecessary and possibly unethical for patients randomized to the control arm to continue accrual to 534 patients with 18 months follow-up. The DMC recommended a reduced sample size of approximately 276 patients with a 12 months follow-up, which could potentially accelerate the overall time line of the trial by more than a year. Novocure has filed an IDE supplement with the FDA and is awaiting the agency's response. We're encouraged by this important update in lung cancer, an area of huge unmet medical need in China. And look forward to additional clinical data readouts for Novocure in pancreatic, liver and ovarian cancers, in brain metastasis and in glioblastoma with high-intensity arrays.

We also have a China-only Phase II pilot trial in gastric cancer that is expected to complete enrollment this year. And we continue to be on target to file tumor treating fields in mesothelioma later this year.

Now I'd like to discuss the recent regulatory approval for QINLOCK. We filed QINLOCK for approval in China last July. It was accepted under priority review, and the NDA was approved in March, 1 full quarter ahead of the original schedule. We expect to launch the product in fourth-line GIST in the second quarter. QINLOCK is the first approved tyrosine kinase inhibitor designed specifically for GIST patients regardless of mutational status. The INVICTUS trial demonstrated a significant benefit versus placebo in progression-free survival and overall survival, and served as the basis of the QINLOCK approval in both U.S. and China.

Top line data for the Phase III global pivotal INTRIGUE trial in second-line GIST are expected in the second half of 2021, and could potentially support label expansion in this important indication.

We have many other products we'd like to discuss with you, but in the interest of time, I will highlight one, bemarituzumab. This compound is a first-in-class antibody that is being developed in gastric and gastroesophageal junction cancer as a targeted therapy for tumors that overexpress FGFR2b.

In data presented at ASCO GI in January, bema, in combination with modified FOLFOX, demonstrate statistically significant improvement versus placebo versus modified FOLFOX in all 3 efficacy endpoints of the FIGHT trial, including progression-free survival and overall survival.

Bema could address a significant unmet need in China. There are 680,000 new cases of gastric cancer every year, approximately 87% to 88% of which are HER2 negative, and about 30% of these are potential patients for bema. The compound was a key driver in Amgen's $1.9 billion acquisition of Five Prime in April, when bema also received breakthrough designation from the FDA. Amgen is actively planning for pivotal Phase II study and is considering budding the compound in additional indications such as squamous cell non-small cell lung cancer. We will work closely with our new partners to maximize the full potential for this exciting product.

I would like to say a few words about our business development execution last quarter and beyond. We entered into 3 highlight strategic collaborations recently with argenx, Turning point and Cullinan Oncology in Greater China. Efgartigimod became the anchor asset for our autoimmune franchise with true pipeline-in-a-product potential. Since we entered into the partnership, Efgart's BLA for gMG was accepted with PDUFA date of December 17, 2021. Phase III trial are ongoing in CIDP, pemphigus and ITP. And Zai Lab plans to enroll Chinese patients to these trials.

Argenx also plans to identify and begin clinical testing in 2 additional indications this year with more being planned for future years. CLN-081 and TPX-0022 significantly bolstered our lung cancer and gastric cancer franchises, 2 areas where we have built world class portfolios. These fields are great examples of how we use business development of the key strategy to quickly expand our business vertically and horizontally, and create a sustainable platform for Zai Lab.

Going forward, with our strong track record of execution and the new capital we raised through recent equity offerings, we will continue to leverage our target [ choice ] status to strengthen our pipeline through BD efforts. Our BD pipeline remains very strong.

Looking ahead into remainder of 2021. Zai Lab, alongside our development and commercial partners, is once again positioned to achieve key milestones, which are summarized in our press release. We plan to expand the indications of commercial products, achieve approval for new products, submit for new regulatory approvals, provide key clinical data readouts from both late- and early-stage programs, initiate numerous pivotal studies across our pipeline, advance internally developed assets with global rights and aggressively pursue new business development opportunities. It goes without saying, we're committed to continuing Zai's track record of efficient and effective execution.

Now I would like to turn the floor over to my colleague, Billy Cho, Chief Financial Officer, to discuss our recent financing and our first quarter 2021 financial results.

[Ki Chul Cho, executive]

Thank you, Tao. I will give a brief summary of our recent financing and review of our financial results for the first quarter of 2021.

Last month, we closed on a global offering of both American depository shares and ordinary shares with gross proceeds to Zai Lab of approximately $857.5 million. This offering was the first ever dual-tranche offering in both NASDAQ and the Hong Kong Stock Exchange.

As mentioned before, this new strategic capital will allow us to expand our pipeline through additional collaboration agreements, accelerate the clinical development of our product portfolio and scale of the R&D and commercial organizations to drive strong revenue growth and enhance our global pipeline for years to come.

Moving to our financial results for the 3 months ended March 31, 2021. Net product revenues were $20.1 million compared to $8.2 million for the same period in 2020. Revenues for the period were comprised of $12.6 million for ZEJULA compared to $6.3 million for the same period in 2020; and $7.1 million for Optune compared to $1.9 million for the same period in 2020.

Research and development expenses were $203.9 million for the 3 months ended March 31, 2021 compared to $33.7 million for the same period in 2020. The increase in R&D expenses was primarily attributable to the $62.3 million upfront payment in Zai Lab equity, which was determined at the fair value of the shares on the closing date given certain restrictions. And the $75 million development cost-sharing payment to argenx as well as the $25 million upfront to Turning Point. There were also additional expenses related to ongoing and newly initiated late-stage clinical trials and payroll and payroll-related expenses from increased R&D headcount.

Selling, general and administrative expenses were $35.8 million for the 3 months ended March 31, 2021 compared to $18.7 million for the same period in 2020. The increase was primarily due to payroll and payroll-related expenses from increased commercial headcount and related costs as Zai Lab continued to expand its commercial operations in China.

For the 3 months ended March 31, 2021, Zai Lab reported a net loss of $232.9 million, or a loss per share attributable to total share of stockholders of $2.64 compared to a net loss of $48 million or a loss per share attributable to common stockholders of $0.66 for the same period in 2020. As previously highlighted, the increase in net loss was primarily attributable to the new collaboration agreements with argenx and Turning Point recorded in R&D expenses.

As of March 31, 2021, cash and cash equivalents, short-term investments and restricted cash totaled $1.014 billion compared to $1.188 billion as of December 31, 2020. In addition, in April 2021, Zai Lab announced the closing of a global follow-on offering. The expected total proceeds to Zai Lab, including both the American depository shares offering and the ordinary shares offering, net of underwriting fees and other operating expenses, are approximately $818.1 million.

We would now like to turn the call back over to the operator to open up the line for questions. Operator?

[Operator]

[Operator Instructions] Our first question comes from the line of Yigal Nochomovitz from Citigroup.

[Yigal Nochomovitz, analyst]

Tao, you mentioned that the BD pipeline remains very strong. So what should we expect in terms of the pace of new business development initiatives over the near-term? And is the plan to continue to expand into these areas where you already have exposure, such as oncology, autoimmune and infectious disease? Or would you consider branching out perhaps into new areas such as rare disease and into additional treatment modalities, for example, cell therapy, where you currently don't have exposure?

[Ying Du, executive]

Thank you, Yigal. Jonathan, do you want to address that question?

[Jonathan Wang, executive]

Sure. Thanks for the question, Yigal. So I think over the last few years, we have really established a very sustainable platform as a company. And I think really to our development, commercialization, regulatory team's combined efforts, we've built up scale, we've built up leadership in China and demonstrated through track record. And as a result of that, these days, as Tao mentioned, we're getting a lot of inbound interest from potential partners as well as some existing partners across very diverse areas and products. For us, always, we aspire to bring in global quality, best-in-class, first-in-class assets. The quality is always the most important.

And I think if you looked at our track record over the last couple of years, I think our track record speaks to itself. And I think as we continue to build, our BD strategy is always to support the company's growth. And our ambition is ultimately to be a global biopharmaceutical company. And so your question also asked about therapeutic areas. I think if you look at, especially, for example, in the last 12 months, we've done a number of deals, which actually expanded our therapeutic areas. For example, the Regeneron deal as well as the argenx deal. And we got into 2 areas in hematology as well as for the autoimmune diseases, which we did not have strong presence in beforehand. And very quickly through these anchor assets, we're able to build a pretty nice pipeline in those new areas.

So going forward, I think we definitely continue to strengthen existing disease strongholds in oncology, for example, in lung, in gastric, in areas like these, it's very important for us. But also potentially to get into new therapeutic areas like what we've done with argenx, with Regeneron, and potentially also to enter into collaborations that would further accelerate our global ambition. So hopefully, that answers your question, Yigal.

[Operator]

[Operator Instructions] Our next question is from the line of Seamus Fernandez of Guggenheim.

[Seamus Fernandez, analyst]

Targeted therapy. Just hoping you could help us understand in -- amongst the U.S. companies, there are some concerns raised about the pace of targeted therapy and patient identification in the market today. I was hoping to just understand better, given your broad targeted therapy portfolio, how this might differ in China? Or if you just think that the market is misinterpreting the pace of uptake relative to the U.S. market and some other developed markets of these targeted therapies that you have partnered relative to COVID?

So I'm just trying to maybe ask if you guys can tease out a little bit more of the strategy and optionality with the broad targeted portfolio. And if you see that having significant advantages in China or if you just think that the concerns that are being raised today by investors around the pace of targeted therapy update and patient identification, if that's really more of a COVID-related issue in your view?

[Ying Du, executive]

We, actually, as you said, we have target therapies. We have immunotherapies. We also have tumor treating fields. All 3 offers a functional approaches for combo opportunities. Specifically to target therapies, we have, for example, even in lung cancer and gastric cancer, a special targeted therapy addressing different patient population. And I don't think COVID has much impact to our business from last year and this year, pretty much based on that you can see from our revenue and from other clinical development perspective.

And also I think China right now is more and more close to the developed countries treatment options -- treatment standards diagnostics -- companion diagnostics companies are also growing very well. Together with these global diagnostic companies, we don't see much issue with patient segmentation or finding the right patient population.

Having said so, if you look at our platform, the current 3 approved products, they are all-comers status. For example, for ZEJULA, is the only first-line all-comers monotherapy ovarian cancer patient. And second-line -- in the first-line and second-line. And for the QINLOCK also is the only all-comer status -- so all -- for later line, this patient population. And also for Optune, it's also the -- there's no diagnostic requirement. So for us, right now, we're in a very good position and to -- we're able to kind of broader coverage to the patient populations, which each one of them have a much greater patient population than in the other countries. Seamus, did I answer your questions?

[Seamus Fernandez, analyst]

Yes. I mean, that makes sense. I guess as you move forward and it was more a question of, are there opportunities to kind of utilize your broader portfolio to optimize patient identification for the targeted therapies. I know that, that's something that's unique to Zai Lab relative to others. But that -- I think you answered my question.

[Ying Du, executive]

Thank you. Yes. again, let me just -- you brought a very good point because in each strong disease cohorts, we have multiple target therapies with -- so when we go to a doctor, we can also many different test partners, the different options for treatment based on the mutation type. Thank you.

[Operator]

Our next question is from the line of Ziyi Chen of Goldman Sachs.

[Ziyi Chen, analyst]

Congratulations on a strong quarter. With the recent public offering, I think Zai Lab now have a very strong cash position, about like $1.8 billion. So it will be great that management could share with us more color on how you're going to spend that money? What would that be -- are you going to accelerate the pace for the BD deals? Or you're going to spend more efforts on in-house discovery team build up? Or any color on building out the significant bigger commercial team. So trying to understand how you're going to allocate the resources and beef-up the in-house pipeline and also the commercial strength?

[Ying Du, executive]

Yes, that's a very good question, Ziyi. I'll ask Billy to address the questions.

[Ki Chul Cho, executive]

Sure. Ziyi, thanks for the question. So you're right. Right now, if you add in the capital raise for -- during April, we do have a little over $1.8 billion in cash if you combine that with the March close balance. But specifically to the capital raising from last month, it is based on our fundamental strategic need. So to your question, the answer is yes, in terms of the strategic capital being applied to accelerate the timeline to scale the trial further. And breaking down further into specific areas within the functional departments, a good part of it will go to fund new business opportunities, in terms of BD, corporate development and licensing opportunities that we were talking about on the -- in the call as well as the earnings release, both.

And then also, we've identified opportunities to complete additional clinical trials, advance these drug candidates and just overall scale up our R&D platform. And the same goes to our commercial efforts. We have a very significant schedule, not only ramping up the 3 innovative products we have right now, but we have many more Q4 potential approval launch over the next few years, as you know, like over 10, with just the current pipeline in the medium term, so making sure that we can absorb that type of growth is going to be important.

So we want to allocate some funding to expand our commercialization efforts. And then last but not least, also to enhance our global pipeline. So these are the 4 broad areas where we see we're going to deploy this capital and create additional shareholders value.

[Operator]

Our next question is from the line of Anupam Rama of JPM.

[Anupam Rama, analyst]

Congrats on all the progress. Maybe I can ask a quick one on QINLOCK here. I know it's early days and the GIST launch is expected later this month. But just wondering how we should be thinking about that launch curve here, say, relative to ZEJULA?

[Ying Du, executive]

Thank you for your questions. Billy, do you want to address that?

[Ki Chul Cho, executive]

Yes, sure. Anupam, thanks for the question. You're right. It's pretty exciting times right now. We're going to have our first launch in gastric cancer franchise with QINLOCK in advance GIST. We expect to launch this month in May. And we think that we have an opportunity here to establish a new standard of care for treating patients with [ advantages ] in China. And of course, later this year, we also have tech line data coming out. So we're anticipating that outcome as well so we'll see so. As you know, Anupam, there's approximately 30,000 GIST patients newly diagnosed in China every year. So it's a quite significant number, quite as many as U.S. and Europe combined. So we have a pretty significant opportunity. And we have already built a commercial team in our gastric cancer franchise to launch QINLOCK well, and we're ready to go. So we're not giving guidance just yet, but it's pretty exciting.

[Operator]

Next question is from the line of Jonathan Chang of SVB Leerink.

[Jonathan Chang, analyst]

Congrats on the progress. With the recent approvals of anti-PD-1 drugs in frontline gastric cancer, can you talk about how this impacts your gastric cancer strategy with multiple partner programs in this space?

[Ying Du, executive]

Thank you for the question. Alan, do you want to address the question?

[Alan Sandler, executive]

Sure. Thank you very much. And thanks for the question. Of course, as you know, gastric cancer is the second largest cancer in China, both in terms of incidents and mortality and their significance unmet need. Fortunately, more and more treatment options are available. We've -- Tao had mentioned bema earlier. And the FGFR2b expression appears to be orthogonal in that it appears to occur in those patients not necessarily expressing HER2, for example. So there continues to be a -- definitely an unmet need and opportunity there as well.

With respect to HER2 and the recent accelerated approval for pemetrexed. We still believe, as does our partners, MacroGenics, that there's definite opportunity there and continue to evaluate margetuximab with PD-1 checkpoint blockades, and believe that this may create synergistic antitumor activities to enhance tumor-specific T cell immunity. So we still believe there are considerable opportunities in this important area.

Did I address your question?

[Jonathan Chang, analyst]

Yes. Partially. Maybe I can just sneak in a follow-up then on bemarituzumab, specifically. How should we be thinking about next regulatory and development steps? What could a potential Phase III study look like in the context of this evolving gastric cancer landscape?

[Ying Du, executive]

Jonathan, definitely can...

[Alan Sandler, executive]

Sure. So -- sorry.

[Ying Du, executive]

Go ahead. Go ahead, Alan.

[Alan Sandler, executive]

I think that we are -- I think it's safe to say we're working with our partners, Amgen, in evaluating the recent changes that have occurred in this particular area. And we'll be working towards the optimal design of that Phase III study moving forward.

[Operator]

Next question is from the line of Michael Yee of Jefferies.

[Michael Yee, analyst]

Congrats on a great quarter of progress. Going back to the follow-up about the recent significant capital raise. I was wondering about your consistent stated goal to become a global pharmaceutical company. But wondering if that specifically means that you would be interested in expanding more so into other geographies, Asia, East or West? And thinking about what that means to become a global pharmaceutical company beyond China? And how the capital raise may play a role in that, if at all?

[Ying Du, executive]

Michael, thank you. It's early morning for you, right, in the West Coast. And I think, as we mentioned earlier, we definitely aspire to be a global biopharma company. And in the next 3 to 4 years, we're planning to have additional 10 more products launched without taking into account any new partnerships, indication expansions or combo status. And what I also like to highlight is, China is now the second largest global market. And going forward, it's going to continue with double-digit growth. So we're doing well in China and we're doing well globally. And we also, as I mentioned earlier, we have a very strong pipeline.

On top of what we talked about, we have 3 products, already they are approved. With 1 more to be approved this year and 10 more to be approved over the next 3 to 4 years, we believe our commercial position is very strong in Greater China and Asia. However, we also have a very strong pipeline, not only at later stage but early stage with -- we talked about 7 in terms of discovered pipeline with global rights, including 3 in global Phase I products. We do believe by the next 3 to 4 years, we will have some of them entering into pivotal stage.

And of course, in addition, we have a very strong BD team. And our BD teams continue to seek strategic collaborations to bring more promising assets that address unmet medical needs to our portfolio. Some can be of global rights, some can be of China rights based on the stage and also based on the patient population. And this is also to revolve along our strategy to supplement our own internal pipeline.

Accordingly, and we have over the last few years expanding R&D footprint and our R&D team globally. We have now teams, not only in China, in Shanghai, in Beijing in R&D. But also, we have teams in Boston and San Francisco focusing on R&D as well. And we believe that all of these approaches, we are well positioned to realize our ambition in the near future.

[Operator]

We have Yang Huang of Crédit Suisse for the next question.

[Yang Huang, analyst]

So my question is on tumor treating Fields commercialization progress in China. So we understand it's already almost a year since we commercially launched the product in China. Can you give us kind of more color on commercial progress? For example, if compared to developed countries, I mean, do China patients -- they're on a device longer or shorter or we have various collaboration with supplemental insurance in China. And how does those insurance plan increase our new patients who are using our devices? And yes, any color on commercialization would be helpful.

[Ying Du, executive]

Sure. Sure. I'll let Billy to address your question.

[Ki Chul Cho, executive]

Yang, thanks for the question. So the sales of Optune in China has been robust. So you saw from our earnings release that first quarter 2021 came in $7.1 million compared to $1.9 million in the same period last year, and the momentum is quite strong as we continue on in second quarter and beyond. So we're not yet giving full year guidance. But I'll just also as you know that, given the momentum, we did double the number of sales teams from about 50 at launch to about 100 now. And to your point, also, you specifically mentioned other payer types that we've been able to leverage and to [indiscernible] adoption. And you're exactly right. So there are 13 supplemental insurance plans that we were added to, and there's additional commercial plans as well. It's mostly still driven by private pay, but we think that over the longer term, these additional payer pools, if you will, is going to be quite favorable long-term and the contribution should increase. So those are all trending in the right direction.

So hopefully -- and oh, yes, you also asked about sort of the experience we've had specifically with Chinese patients and how they compare to sort of ex-China patients. So we're not giving specifics on that, partly because the launches both from the U.S. as well. It's really kind of in the back half of second half -- kind of back half to second half last year, where Optune kind of was -- kind of we were actually kind of in the initial stages of the current launch curves. But we see strong uptick, as I previously mentioned before, new patients and we're collecting good data right now on a monthly basis. And is definitely trending on the right path, and we think that we're going to set a new benchmark in terms of first 12 months scripts.

[Operator]

We have David Ng from Macquarie.

[David Ng, analyst]

It's David from Macquarie. If I may, I can just focus on ZEJULA and Optune again. So for first quarter, very strong year-over-year sales. Can you tell a little bit about the quarter-over-quarter trend for ZEJULA? And then, I guess, specifically after March, when the new price and NRDL coverage kicks in. Can you share with us what you noticed on the ground, especially in terms of volume expansion, is the speed satisfactory? And entering into April and May, has the ramp-up continue? So that's ZEJULA.

And again, maybe also comparing against the 2 new competitors. Of course, their indications are not the same as you guys, but I noticed that their price is also quite comparable with, I guess, BeiGene also just recently launch theirs. So any thoughts along that line in terms of further pricing strategy for the rest of this year? So even post-NRDL inclusion, any thinking of offering some more kind of PAP program on top of NRDL to be competitive on ZEJULA? So sorry, a couple of questions on ZEJULA.

On Optune, basically, I guess, a strategic question in the next 3 to 4 years. With much fewer competitive threat in China, does it make sense not to go after NRDL like on a national level? And if that's the case, does it mean that it can afford your team more time to ramp it up more gradually? And then achieve maybe potentially even higher peak sales rather than compared to some of the other innovative drugs in China where they have to really go intensive in the first 2 years after NRDL inclusion? So that's kind of my question on the 2 products.

[Ying Du, executive]

Yes. David, I think you asked a lot of questions. For the interest of time, I would like Billy to give some answers from your questions to address. Billy?

[Ki Chul Cho, executive]

Sure. Thanks, Samantha. Thanks, David, for the question. So let me go through one by one, but I'll backwards and then address it the earlier ones. So in terms to Optune and your question is about sort of optimizing the private pay channel with the comprehensive strategy. The short answer is, yes. And we've always said that for Optune, for GBM, that's going to be the base strategy. And that there are other indications, larger indications, progressing quite well, especially what we can use. So we'll kind of revise our strategy once those get finalized and ultimately approved and launched. So our fingers crossed, and that's going to be a great position to be.

Can we -- what can we do above and beyond sort of the current comprehensive private pay strategy with not only out-of-pocket for the [ calling ] plans, commercial payers, supplemental insurance, et cetera. Because, David, to your point, really that approach, if you do it well, achieve the rational pricing as well as increase adoption. So to layer on something above that, we think it will be a positive, but to be continued.

To your first group of questions on ZEJULA, I believe you were talking about sort of competitive landscape and then our first quarter ramp. So in terms of the competitive landscape, you're right. The -- I think the best way to -- the way we will characterize it is we part asset class we're becoming quite important to address not only ovarian cancer patients, but even beyond that in China. And that's great to see. The awareness building up in this asset class because we believe that we have already positioned ZEJULA as a best-in-class PARP inhibitor. And we see that in our -- although we're not giving guidance and specific kind of KPI, but we already see that.

And in third quarter, when the NRDL was implemented, we saw a clear kind of volume ramp up. And of course, it's going to continue in terms of kind of adopting and sort of absorbing and transitioning to an NRDL drug, right, because you have to now go out and get on all the hospital listings. But of course, the number of hospital listings has kind of noted upwards, trending up nicely into the second quarter and beyond. And of course, that's the reason why we've also doubled the number of sales team from 150 at launch to 300 as of right now, and we'll continue to invest because we see good momentum.

And yes, so hopefully, those -- hopefully, I did a good job in answering your question.

[Ying Du, executive]

Yes, I think David, regarding your competitive landscape for ZEJULA, where we're right now are the only entity who has all-comer status approved. Any all-comer status approved for ovarian cancer. And we'll also -- on a second-line, we got -- [indiscernible] NRDL end last year. So the 2 competitors you mentioned, we don't view them as our competitors because they are in BRCA and the later line, and they just launched this year. So we don't feel we need to address -- we don't, at least, for now or near term we see any justification for us to modify our strategy because of those latest comers for later line patients.

[Operator]

I'm showing no further questions at this time. I will now turn the call back over to Zai Lab's CEO, Samantha Du, for closing remarks.

[Ying Du, executive]

Thank you, operator. I want to thank everyone for taking the time to join us on the call today. We appreciate your support and look forward to updating you periodically on our progress throughout the year. Operator, you may now disconnect this call. Thank you all.

[Operator]

Thank you. And this concludes today's conference call, and thank you for participating. You may now disconnect.