UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL INFORMATION
On September 2, 2025, the Company announced that it completed the sale of FibroGen International (Hong Kong) Ltd., (including its subsidiaries, “FibroGen China”) to AstraZeneca Treasury Limited (“AstraZeneca”), for a total consideration of approximately $220 million, subject to certain customary adjustments as set forth in the purchase agreement, comprised of $85 million in enterprise value and approximately $135 million in net cash held in China (collectively, the “Transaction”). At closing of the Transaction, the Company also repaid its senior secured term loan facilities with Morgan Stanley Tactical Value (“MSTV”) for approximately $81 million. In addition, the Company also entered into certain related transaction agreements at the closing, including a transition services agreement and other customary agreements.
The following unaudited pro forma condensed consolidated financial information is intended to illustrate how the above transactions contemplated would affect the historical financial statements of FibroGen if the transactions contemplated therein had been consummated at an earlier time as indicated herein.
The unaudited pro forma condensed consolidated financial information is derived, in part, from, and should be read in conjunction with, FibroGen’s historical consolidated financial statements and notes thereto, as presented in its Quarterly Report on Form 10-Q for the six months ended June 30, 2025 and its Annual Report on Form 10-K for the year ended December 31, 2024.
The unaudited pro forma condensed consolidated financial information has been prepared in accordance with Article 11 of Regulation S-X. FibroGen’s accounting and financial reporting in these unaudited pro forma condensed consolidated financial information is based on its preliminary assessment of the appropriate application of accounting principles generally accepted in the U.S. (“U.S. GAAP”). The final application of U.S. GAAP to the Transaction may differ from what is presented in these unaudited pro forma condensed consolidated financial information.
The unaudited pro forma condensed consolidated balance sheet as of June 30, 2025 is prepared with the assumption that, as of June 30, 2025, the Transaction had been consummated without customary adjustment or indemnity claim and the Company had paid off all remaining obligations under the senior secured term loan facilities with MSTV.
The unaudited pro forma condensed consolidated statement of operations for the year ended December 31, 2024 is prepared with the assumption that, as of January 1, 2024, the Transaction had been consummated, the Company had paid off all remaining obligations under the senior secured term loan facilities with MSTV and the Company has provided post-closing services under the transition services agreement during the year ended December 31, 2024. The Company has not included an unaudited pro forma condensed consolidated statement of operations for the six months ended June 30, 2025, as the Transaction was already reflected as discontinued operations within the financial statements in its Quarterly Report on Form 10-Q for the period.
The transaction accounting adjustments to reflect the sale of FibroGen International in the unaudited pro forma condensed consolidated financial statements include:
•The sale of the assets and liabilities of FibroGen International, and adjustments of events that are directly attributable to the sale including, but not limited to those required to record the estimated impact of the consideration received in connection with the transaction, transaction costs, and estimated gain associated with the transaction;
•Adjustments to release all deferred revenue related to China single performance obligation and recognition as revenue associated with FibroGen International, which is then presented as part of discontinued operations;
•Recognition of other income for the post-closing services provided under the transition services agreement; and
•The use of proceeds received from the transaction and existing cash and cash equivalents to repay the remainder of a term loan; and
•Adjustment to nonredeemable non-controlling interests related to the Company’s subsidiary, FibroGen International (Cayman) Ltd., for the distribution triggered by the Transaction.
The unaudited pro forma condensed consolidated financial information does not purport to be indicative of the results of operations, the financial position or the gain on the transaction which would have actually resulted if the above transactions contemplated had been consummated on the dates indicated, or which may result in the future.
We prepared the unaudited pro forma condensed consolidated financial information based upon assumptions deemed appropriate by our management. An explanation of certain assumptions is set forth under the notes to the unaudited pro forma condensed consolidated financial information. The pro forma adjustments may differ from those that have been or will be calculated to report the Transaction as a discontinued operation in our historical and future filings, and do not reflect future events that may occur after the Transaction.
The unaudited pro forma condensed consolidated financial statements should be read in conjunction with the notes thereto.
FIBROGEN, INC.
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
AS OF JUNE 30, 2025
(In thousands, except per share amounts)
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As Reported |
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Transaction
Accounting
Adjustments |
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Note 2 |
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Pro Forma |
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Assets |
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Current assets: |
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Cash and cash equivalents |
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$ |
23,367 |
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$ |
121,659 |
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(a)(b) |
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$ |
145,026 |
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Accounts receivable, net |
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|
136 |
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— |
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136 |
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Inventories |
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3,863 |
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— |
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3,863 |
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Prepaid expenses and other current assets |
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2,306 |
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10,000 |
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(a) |
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12,306 |
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Current assets held for sale |
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132,650 |
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(132,650 |
) |
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(c) |
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— |
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Total current assets |
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162,322 |
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(991 |
) |
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161,331 |
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Other assets |
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|
839 |
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— |
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|
839 |
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Long-term assets held for sale |
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14,894 |
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(14,894 |
) |
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(c) |
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— |
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Total assets |
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$ |
178,055 |
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$ |
(15,885 |
) |
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$ |
162,170 |
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Liabilities, redeemable non-controlling interests and deficit |
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Current liabilities: |
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Accounts payable |
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$ |
10,477 |
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$ |
— |
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$ |
10,477 |
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Accrued and other current liabilities |
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35,916 |
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|
3,807 |
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(a)(b)(d)(e) |
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39,723 |
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Deferred revenue |
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27,311 |
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(20,723 |
) |
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(f) |
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6,588 |
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Senior secured term loan facilities, current |
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73,733 |
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(73,733 |
) |
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(b) |
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— |
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Current liabilities held for sale |
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8,458 |
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(8,458 |
) |
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(c) |
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— |
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Total current liabilities |
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155,895 |
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(99,107 |
) |
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56,788 |
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Product development obligations |
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19,398 |
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— |
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19,398 |
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Deferred revenue, net of current |
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122,224 |
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(122,224 |
) |
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(f) |
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— |
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Liability related to sale of future revenues, non-current |
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61,306 |
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— |
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61,306 |
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Other long-term liabilities |
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106 |
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— |
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106 |
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Long-term liabilities held for sale |
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156 |
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(156 |
) |
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(c) |
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— |
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Total liabilities |
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359,085 |
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(221,487 |
) |
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137,598 |
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Redeemable non-controlling interests |
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21,480 |
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— |
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21,480 |
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Stockholders’ deficit: |
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Preferred stock |
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— |
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— |
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— |
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Common stock |
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1,011 |
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— |
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1,011 |
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Additional paid-in capital |
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1,673,249 |
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2,101 |
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(e) |
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1,675,350 |
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Accumulated other comprehensive loss |
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(4,794 |
) |
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2,572 |
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(g) |
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(2,222 |
) |
Accumulated deficit |
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(1,892,463 |
) |
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208,383 |
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(h) |
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(1,684,080 |
) |
Total stockholders’ deficit attributable to FibroGen |
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(222,997 |
) |
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213,056 |
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(9,941 |
) |
Nonredeemable non-controlling interests |
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20,487 |
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(7,454 |
) |
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(e) |
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13,033 |
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Total equity (deficit) |
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(202,510 |
) |
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205,602 |
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3,092 |
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Total liabilities, redeemable non-controlling interests
and equity (deficit) |
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$ |
178,055 |
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$ |
(15,885 |
) |
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$ |
162,170 |
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See accompanying notes to the unaudited pro forma condensed consolidated financial information.
FIBROGEN, INC.
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 2024
(In thousands, except per share amounts)
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As Reported |
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Transaction
Accounting
Adjustments |
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Note 2 |
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Pro Forma |
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Revenue: |
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Development and other revenue |
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$ |
1,948 |
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— |
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$ |
1,948 |
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Drug product revenue, net |
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27,673 |
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— |
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27,673 |
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Total revenue |
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29,621 |
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— |
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29,621 |
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Operating costs and expenses: |
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Cost of goods sold |
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15,561 |
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— |
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15,561 |
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Research and development |
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95,692 |
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— |
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95,692 |
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Selling, general and administrative |
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49,330 |
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— |
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49,330 |
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Restructuring charge |
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19,454 |
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— |
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19,454 |
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Total operating costs and expenses |
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180,037 |
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— |
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180,037 |
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Loss from operations |
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(150,416 |
) |
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— |
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(150,416 |
) |
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Interest and other, net |
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Interest expense |
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(8,247 |
) |
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— |
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(8,247 |
) |
Loss on debt extinguishments |
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— |
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(6,788 |
) |
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(i) |
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(6,788 |
) |
Interest income and other income (expenses), net |
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5,296 |
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|
777 |
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(j) |
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6,073 |
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Total interest and other, net |
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(2,951 |
) |
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(6,011 |
) |
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(8,962 |
) |
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Loss from continuing operations before income taxes |
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(153,367 |
) |
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(6,011 |
) |
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(159,378 |
) |
Benefit from income taxes |
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(269 |
) |
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— |
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|
(269 |
) |
Loss from continuing operations |
|
$ |
(153,098 |
) |
|
$ |
(6,011 |
) |
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$ |
(159,109 |
) |
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Loss from continuing operations per share - basic and diluted |
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$ |
(1.53 |
) |
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$ |
(1.59 |
) |
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Weighted average number of common shares used to calculate
net loss per share - basic and diluted |
|
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100,044 |
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|
100,044 |
|
See accompanying notes to the unaudited pro forma condensed consolidated financial information.
FIBROGEN, INC.
NOTES TO UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL INFORMATION
1. Basis of Presentation
The unaudited pro forma condensed consolidated financial information is prepared based on FibroGen’s historical consolidated financial statements and pursuant to Article 11 of Regulation S-X, adjusted for certain transaction accounting adjustments listed in the Note 2 below. Actual adjustments, however, may differ materially from the information presented.
In addition, FibroGen does not expect material income tax impact resulting from the transactions contemplated by the Agreement as it maintains a full valuation allowance on all of its deferred tax assets due to its history of losses.
2. Pro Forma Adjustments
The unaudited pro forma condensed consolidated financial information reflects the following adjustments:
(a)Recognition of cash received for the sale of $210.4 million, less cash paid for transaction costs of $7.7 million at the closing of the transaction as of June 30, 2025, including payment of $2.2 million of outstanding accrued transaction costs; and recognition of $10.0 million receivable from AstraZeneca based on the assumption that there is no customary adjustment or indemnity claim post the closing of the Transaction.
(b)Cash paid to MSTV of $80.9 million to pay off the remaining obligations of the term loan of $73.7 million, the outstanding accrued interest of $0.4 million and recognition of loss on debt extinguishments of $6.8 million as of June 30, 2025.
(c)Derecognition of the associated assets and liabilities held-for-sale upon divestiture as of June 30, 2025, the net asset value of which is $138.9 million.
(d)Recognition of $1.1 million accrued severance payable to certain officer and employees at the closing of the transaction, assuming the transaction had been consummated on June 30, 2025.
(e)Recognition of $5.4 million payable to the minority shareholders of the Company’s subsidiary, FibroGen International (Cayman) Ltd, and the corresponding reduction to the nonredeemable non-controlling interests of $7.5 million and adjustment to additional paid-in capital of $2.1 million, for the distribution triggered by the Transaction.
(f)Release of all deferred revenues related to the single performance obligation totaling $142.9 million associated with FibroGen International as of June 30, 2025.
(g)Derecognition of the currency translation adjustment balance of $2.6 million related to FibroGen International as a result of foreign currency translation upon divestiture as of June 30, 2025.
(h)This represents the net change in accumulated deficit of the following:
•Recognition of gain on the transaction of $73.4 million, assuming the transaction had been consummated on June 30, 2025, which takes into consideration $210.4 million of cash received, $10.0 million receivable, less additional transaction costs of $5.5 million (total transaction costs of $7.7 million at the closing of the transaction, less $2.2 million that was accrued as of June 30, 2025 (see (a)), based on the net asset held-for-sale of $138.9 million (see (c)), and the currency translation adjustment balance of $2.6 million (see (g));
•Recognition of loss on the debt extinguishments of $6.8 million (see (b));
•Recognition of $1.1 million severance costs (see (d), which would be presented in the results of discontinued operations; and
•Recognition of deferred revenue related to the single performance obligation totaling $142.9 million upon the sale of FibroGen International (see (f)), which would be presented in the results discontinued operations.
(i)Recognition of loss on debt extinguishments of $6.8 million for the year ended December 31, 2024, assuming FibroGen had paid off all obligations under the senior secured term loan facilities with MSTV as of January 1, 2024.
(j)Recognition of $0.8 million other income for the post-closing services provided under the transition services agreement during the year ended December 31, 2024.