GNI : Update Regarding F351 China PhaseⅡliver Fibrosis Clinical Trial

Update Regarding F351 China Phase II Liver Fibrosis Clinical Trial

January 20, 2020 - GNI Group Ltd. (GNI Group or Company) previously announced on August 30, 2019 the last-patient-out of the Phase II clinical trial of F351 for liver fibrosis. The Company is hereby providing an update on the data analysis and preparation for consulting with NMPA (formerly CFDA).

After the last-patient-out, the Company collected biopsy slides from the 10 participating hospitals. Such slides were stained at a central location and then analyzed by the three independent pathologists. The pathologists individually and blindly scored the slides based on the Ishak fibrosis score system. Final scores have been given to the Company. Concurrently, the Company requested the participating trial hospitals to complete audits of their respective clinical trial processes. The process which is different in each participating hospital, is audited by independent audit expert. The time required to complete the audit process is different at each hospital, although the majority of work has already been completed. After conclusion of the trial audit processes, the principal investigators and statistician will meet on two separate occasions to fully analyze the data and then un-blind the trial. Once such data becomes available, the Company will make timely disclosure.

In parallel to the Phase II data collection and analysis process outline above, the Company conducted a number of smaller scale related clinical studies based on instructions outlined in the previous NMPA approval letter for Phase II studies. To date, two bio-equivalency studies (40 subjects) of 15 mg capsules and 30 mg capsules, as well as additional pharmacokinetics studies of 30 mg capsules (48 subjects) and the drug-drug interaction studies in patients (12 subjects) have been completed. The pharmacokinetics studies in liver fibrosis, hepatic insufficiency, hepatitis patients (8 subjects) are still on-going and are expected to also be completed soon. In addition, the Company concluded the required large scale manufacture process studies for F351 and its subsidiary, Beijing Continent Pharmaceutical Co. Ltd, installed new factory manufacturing equipment in preparation for the production inspection by NMPA.

The drug candidate F351 is the one of the most important pipeline products of our Company. After receiving the final Phase II clinical trial report, plus the completion of the other required studies, the Company will consult with NMPA for the planning of the Phase III clinical trial, as well as explore the opportunity of early conditional approval, as previously announced. The Company will provide further updates on the status of such progress periodically.

About F351 (Generic name: Hydronidone)

F351 is a New Chemical Entity (NCE) derivation of Etuary®, which inhibits hepatic stellate cell proliferation and TGF-β signaling pathway, both of which play major roles in the fibrosis of internal organs. GNI Group has key global patent rights for F351 in a number of countries and regions including China, Japan, Australia, Canada, the United States and Europe.

GNI Group Ltd. does not expect the aforementioned matter will impact financial results for the year ending December 31, 2020.

_______________________________________________________________________________

About GNI Group Ltd.

GNI Group Ltd. is listed on the Tokyo Stock Exchange Mothers Market, Code 2160, with headquarters in Tokyo and subsidiaries in Hong Kong, Shanghai, Beijing and the United States. In the United States, GNI Group has, through its wholly-owned subsidiary GNI USA, Inc., a consolidated subsidiary, Berkeley Advanced Biomaterials LLC. which is a developer and manufacturer of high-quality, cost- effective bone grafts substitutes and headquartered in Berkeley, California. For further information about GNI Group Ltd., please visit www.gnipharma.com., and about Berkeley Advanced Biomaterials, Inc., please visit http://www.hydroxyapatite.com/.

For further inquiries

[phone] Email:[e-mail]

This press release contains "forward-looking" statements, including statements related to the Group's plans to pursue development of product candidates and the timing thereof. Any statements contained in this press release that are not statements of historical fact may be deemed to be forward-looking statements. Words such as "continue," "expected to", "will" and similar expressions are intended to identify these forward-looking statements. There are a number of important factors that could cause the Group's results to differ materially from those indicated by these forward-looking statements, including risks associated with the timing and success of clinical trials and the commercialization of product candidates. The Group does not undertake any obligation to update forward-looking statements.