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

6 Months Ended

Jun. 30, 2022

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

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

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 June 30, 2022 and December 31, 2021, respectively:

				Gross
(In thousands)				unrealized		Aggregate fair
June 30, 2022	Classification	Cost		gains /(losses)		value
MaxCyte - equity interest	Investment	$	—	$	1,753	$	1,753
BioInvent - equity interest	Investment	$	4,337	$	(385)	$	3,952
Total						$	5,705
				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

In the second quarter of 2022, the Company sold 275,000 ordinary shares of BioInvent for $1.3 million. The Company recognized gain of $131,000 in consolidated statements of operations and comprehensive loss.

Unrealized gains on the Company’s equity investment for the three months ended June 30, 2022 and 2021 were nil and $1.9 million, respectively. Unrealized gains on the Company’s equity investment for the six months ended June 30, 2022 and 2021 were nil and $3.4 million, respectively. Unrealized losses on the Company’s equity investment for the three months ended June 30, 2022 and 2021 were $1.4 million and nil, respectively. Unrealized losses on the Company’s equity investment for the six months ended June 30, 2022 and 2021 were $3.0 million and nil, respectively. Unrealized gains (losses) on the Company’s equity investments are recognized as change in fair value of investment in the consolidated statements of operations and comprehensive loss.

Long-term Investments

Long-term investments as of June 30, 2022 and December 31, 2021 consisted of the following:

					Gross		Foreign
			Gross		unrealized		currency
June 30, 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	$	13	$	—	$	—	$	274
Securities measured at fair value:
BioInvent International AB - warrants		656		—		(170)		—		486
Cleave Therapeutics, Inc. - convertible loan		5,500		342		—		—		5,842
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		—		240		30,698
Juventas Cell Therapy Ltd - put option		491		—		(521)		30		—
Prepayment for investment:
Precision Autoimmune Therapeutics Co., Ltd - equity interests		2,962		—		—		24		2,986
Total	$	35,620	$	7,313	$	(1,556)	$	294	$	41,671

					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

Investment in Precision Autoimmune Therapeutics Co., Ltd., (“PAT”)

In May 2022, CASI China entered into an agreement for the investment in PAT in the amount of RMB 20.0 million (approximately $3.0 million) in cash during PAT’s first equity financing. Upon consummation of such equity financing, CASI China will hold 15% equity interests of PAT and will hold one third of the board seats. The leading investor, Guangzhou Redhill Capital Investment Management Co., Ltd, a venture capital company unaffiliated to the Company, will hold 27.5% equity of PAT, and the follower investor, Wuxi Zhihe Daokang Phase II Venture Capital Partnership (Limited Partnership), a venture capital partnership of which Dr. Wei-Wu He, chairman of the board of directors and chief executive officer of the Company, is the general partner, will also hold 27.5% equity of PAT, with the remaining 30% equity held by Hainan Jingshi Kangji Pharmaceuticals Technology Partnership (Limited Partnership), a partnership formed as the equity holding vehicle for PAT’s Employee Stock Ownership Plans. As of June 30, 2022, CASI China has paid all the consideration, the transaction had not been consummated and PAT had no business operation.