AGENUS INC

Previous wording

More detailed descriptions of these risks and uncertainties and other risks and uncertainties applicable to our business that we believe could cause actual results to differ materially from any forward-looking statements are included in in Part I-Item 1A “Risk Factors” of our Annual Report on Form 10-K for the fiscal year ended December 31, 2023 and in Part II-Item 1A within this Form 10-Q. We encourage you to read those descriptions carefully. Although we believe we have been prudent in our plans and assumptions, no assurance can be given that any goal or plan set forth in forward-looking statements can be achieved. We caution investors not to place significant reliance on forward-looking statements contained in this document; such statements need to be evaluated in light of all the information contained in this document. Furthermore, the statements speak only as of the date of this document, and we undertake no obligation to update or revise these statements.

Current wording

More detailed descriptions of these risks and uncertainties and other risks and uncertainties applicable to our business that we believe could cause actual results to differ materially from any forward-looking statements are included in in Part I-Item 1A “Risk Factors” of our Annual Report on Form 10-K for the fiscal year ended December 31, 2023 and in Part II-Item 1A “Risk Factors” of our Quarterly Report on Form 10-Q for the period ended June 30, 2024. We encourage you to read those descriptions carefully. Although we believe we have been prudent in our plans and assumptions, no assurance can be given that any goal or plan set forth in forward-looking statements can be achieved. We caution investors not to place significant reliance on forward-looking statements contained in this document; such statements need to be evaluated in light of all the information contained in this document. Furthermore, the statements speak only as of the date of this document, and we undertake no obligation to update or revise these statements.

Previous wording

Antibody candidate programs, including our lead assets, botensilimab (a multifunctional immune cell activator and human Fc-enhanced cytotoxic T-lymphocyte antigen 4 (CTLA-4) blocking antibody, also known as AGEN1811) and balstilimab (a programmed death receptor-1 (PD-1) blocking antibody).

Current wording

Antibody candidate programs, including our lead assets, botensilimab (a multifunctional immune cell activator and human Fc-enhanced cytotoxic T-lymphocyte antigen 4 (CTLA-4) blocking antibody, also known as AGEN1181) and balstilimab (a programmed death receptor-1 (PD-1) blocking antibody).

Previous wording

We regularly evaluate development, commercialization, and partnering strategies for each product candidate based on various factors, including pre-clinical and clinical trial results, competitive positioning, funding requirements, and available resources. Our lead program, botensilimab (AGEN1181), is progressing through multiple clinical programs designed to support accelerated development as a monotherapy and in combination with balstilimab. In April 2023, botensilimab in combination with balstilimab received Fast Track designation from the U.S. Food and Drug Administration ("FDA") for the treatment of patients with not-microsatellite instability-high ("MSI-H")/deficient mismatch repair ("dMMR") metastatic colorectal cancer with no active liver involvement. Patients targeted with this designation are heavily pretreated with standard of care chemotherapy, anti-VEGF and anti-EGFR if RAS wild type. We completed enrollment of patients with refractory MSS mCRC non-active liver metastases ("NLM") in a Phase 1 trial (n~150) and randomized Phase 2 trial (n~230) in October 2023. We are exploring all potential accelerated approval pathways and intend to initiate a Phase 3 study with plans to ensure continued funding via partnering activities.

Current wording

We regularly evaluate development, commercialization, and partnering strategies for each product candidate based on various factors, including pre-clinical and clinical trial results, competitive positioning, funding requirements, and available resources. Our lead program, botensilimab (AGEN1181), is progressing through multiple clinical programs designed to support accelerated development as a monotherapy and in combination with balstilimab. In April 2023, botensilimab in combination with balstilimab received Fast Track designation from the U.S. Food and Drug Administration ("FDA") for the treatment of patients with not-microsatellite instability-high ("MSI-H")/deficient mismatch repair ("dMMR") metastatic colorectal cancer with no active liver involvement. Patients targeted with this designation are heavily pretreated with standard of care chemotherapy, anti-VEGF and anti-EGFR if RAS wild type. We completed enrollment of patients with refractory MSS mCRC non-active liver metastases ("NLM") in a Phase 1 trial (n~150) and randomized Phase 2 trial (n~230) in October 2023. We are likely not to pursue accelerated approval pathways and intend to initiate a Phase 3 study with plans to ensure continued funding via partnering activities.

Previous wording

We have established collaborations with several companies, including Bristol-Myers Squibb Company (“BMS”), Betta Pharmaceuticals Co., Ltd. (“Betta”), UroGen Pharma Ltd. ("UroGen"), Gilead Sciences, Inc. (“Gilead”), Incyte Corporation (“Incyte”), and Merck Sharpe & Dohme (“Merck”). These collaborations, along with our internal programs, have resulted in over a dozen antibody pre-clinical or clinical development programs.

Current wording

We have entered into collaborations with several companies, including Bristol-Myers Squibb Company (“BMS”), Betta Pharmaceuticals Co., Ltd. (“Betta”), UroGen Pharma Ltd. ("UroGen"), Gilead Sciences, Inc. (“Gilead”), Incyte Corporation (“Incyte”), and Merck Sharpe & Dohme (“Merck”). These collaborations, along with our internal programs, have resulted in over a dozen antibody pre-clinical or clinical development programs.

Previous wording

In December 2018, we entered into collaboration agreements with Gilead for the development and commercialization of up to five novel I-O therapies (the “Gilead Collaboration Agreements”). Gilead received worldwide exclusive rights to our bispecific antibody, AGEN1423, and the exclusive option to license AGEN1223, a bispecific antibody, and AGEN2373, a monospecific antibody. Gilead elected to return AGEN1423 to us in November 2020 and terminated the license agreement. We ceased development of AGEN1223 in the third quarter of 2021, and the option and license agreement for AGEN1223 were formally terminated in October 2021. The AGEN2373 option agreement remains in place, and we are responsible for developing the program until the option decision point. If Gilead exercises the option, we may opt-in to share development and commercialization costs in the United States in exchange for a 50:50 profit (loss) share and revised milestone payments. In March 2022, we received a $5.0 million clinical milestone under the AGEN2373 option agreement. Pursuant to the terms of the AGEN2373 option agreement, as of June 30, 2024, we remained eligible to receive a $50.0 million option exercise fee and up to an additional $520.0 million in aggregate milestone payments, as well as royalties on future sales. On August 5, 2024, Gilead elected not to exercise the option to license AGEN2373 and the option and license agreement was formally terminated.

Current wording

In December 2018, we entered into collaboration agreements with Gilead for the development and commercialization of up to five novel I-O therapies (the “Gilead Collaboration Agreements”). Gilead received worldwide exclusive rights to our bispecific antibody, AGEN1423, and the exclusive option to license AGEN1223, a bispecific antibody, and AGEN2373, a monospecific antibody. Gilead elected to return AGEN1423 to us in November 2020 and terminated the license agreement. We ceased development of AGEN1223 in the third quarter of 2021, and the option and license agreement for AGEN1223 were formally terminated in October 2021. On August 5, 2024, Gilead elected not to exercise the option to license AGEN2373 and the option and license agreement was formally terminated.

Previous wording

In May 2021, we entered into a License, Development, and Commercialization Agreement with BMS for our pre-clinical anti-TIGIT bispecific antibody program, AGEN1777. BMS received an exclusive worldwide license to develop, manufacture, and commercialize AGEN1777 and its derivatives. We retained an option to access the licensed antibodies for use in clinical studies in combination with certain pipeline assets. We received a non-refundable upfront cash payment of $200.0 million and, as of June 30, 2024, were eligible to receive up to $1.32 billion in development, regulatory, and commercial milestone payments, along with tiered royalties. BMS is responsible for all associated costs, and we have the option to co-fund a minority of global development costs in exchange for increased tiered royalties. We also have the option to co-promote AGEN1777 in the U.S. In October 2021, we achieved a $20.0 million milestone upon the dosing of the first patient in the AGEN1777 Phase 1 clinical trial and in December 2023, we announced that the first patient was dosed in an AGEN1777 Phase 2 clinical trial, triggering the achievement of a $25.0 million milestone. We received this milestone in January 2024. On July 30, 2024, we received notice from BMS that it is returning AGEN1777 back to Agenus and voluntarily terminating the BMS License Agreement, effective as of January 26, 2025.

Current wording

In May 2021, we entered into a License, Development, and Commercialization Agreement with BMS for our pre-clinical anti-TIGIT bispecific antibody program, AGEN1777. BMS received an exclusive worldwide license to develop, manufacture, and commercialize AGEN1777 and its derivatives. We received a non-refundable upfront cash payment of $200.0 million. In October 2021, we achieved a $20.0 million milestone upon the dosing of the first patient in the AGEN1777 Phase 1 clinical trial and in December 2023, we announced that the first patient was dosed in an AGEN1777 Phase 2 clinical trial, triggering the achievement of a

Previous wording

In May 2024, we, and certain wholly-owned subsidiaries, entered into a Purchase and Sale Agreement (the “Ligand Purchase Agreement”) with Ligand Pharmaceuticals Incorporated (“Ligand”) for the sale to Ligand of (i) 31.875% of the development, regulatory and commercial milestone payments we are eligible to receive under our agreements with BMS, UroGen, Gilead, Merck and Incyte, (the “Covered License Agreements”) (ii) 18.75% of the royalties we receive under the Covered License Agreements; and (iii) a 2.625% synthetic royalty on worldwide net sales of botensilimab and balstilimab (collectively the “Purchased Assets”). The total amounts payable to Ligand are subject to a 50% reduction in the event total payments to Ligand exceed a specified return hurdle. The synthetic royalty is subject to a reduction if annual worldwide net sales exceed a specified level, and a cap on annual worldwide net sales if annual worldwide net sales exceed a higher specified level. The synthetic royalty can increase by 1% based on the occurrence of certain future events. After taking into account our obligations under the Ligand Purchase Agreement, XOMA Royalty Purchase Agreement and the recent status of our collaboration agreements, we remain eligible to receive up to approximately $136.3 million, $49.4 million and $183.1 million in potential development, regulatory, and commercial milestones from UroGen, Merck and Incyte, respectively.

Current wording

In May 2024, we, and certain wholly-owned subsidiaries, entered into a Purchase and Sale Agreement (the “Ligand Purchase Agreement”) with Ligand Pharmaceuticals Incorporated (“Ligand”) for the sale to Ligand of (i) 31.875% of the development, regulatory and commercial milestone payments we were then eligible to receive under our agreements with BMS, UroGen, Gilead, Merck and Incyte, (the “Covered License Agreements”) (ii) 18.75% of the royalties we receive under the Covered License Agreements; and (iii) a 2.625% synthetic royalty on worldwide net sales of botensilimab and balstilimab (collectively the “Purchased Assets”). The total amounts payable to Ligand are subject to a 50% reduction in the event total payments to Ligand exceed a specified return hurdle. The synthetic royalty is subject to a reduction if annual worldwide net sales exceed a specified level, and a cap on annual worldwide net sales if annual worldwide net sales exceed a higher specified level. The synthetic royalty can increase by 1% based on the occurrence of certain future events. After taking into account our obligations under the Ligand Purchase Agreement, XOMA Royalty Purchase Agreement and the recent status of our collaboration agreements, we remain eligible to receive up to approximately $136.3 million, $49.4 million and $183.1 million in potential development, regulatory, and commercial milestones from UroGen, Merck and Incyte, respectively.

Previous wording

In October 2021, we completed the initial public offering (“IPO”) of MiNK, which trades on the Nasdaq Capital Market under the ticker symbol “INKT”. MiNK is a clinical stage biopharmaceutical company focused on developing allogeneic invariant natural killer T (“iNKT”) cell therapies to treat cancer and other life-threatening immune diseases. MiNK’s most advanced product candidate, agenT-797, is an off-the-shelf, allogeneic, native iNKT cell therapy. MiNK is currently expanding its clinical programs, with a notable externally funded Phase 2 trial in second-line gastric cancer actively enrolling at Memorial Sloan Kettering Cancer Center. Additionally, MiNK is evaluating agenT-797 as a variant-agnostic therapy for patients with viral acute respiratory distress syndrome (“ARDS”) in planning for a randomized phase 2 study through a predominantly externally financed program. Recently, MiNK secured a $5.8 million private placement financing at a 25% premium, led by GKCC, LLC. This funding will propel the clinical development of MiNK-215, its leading allogeneic CAR-iNKT cell therapy targeting fibroblast activation protein (“FAP”) in solid tumors, which is scheduled to enter clinical trials in early 2025. In addition to its lead clinical program, MiNK has announced a collaboration with

Current wording

In October 2021, we completed the initial public offering (“IPO”) of MiNK, which trades on the Nasdaq Capital Market under the ticker symbol “INKT”. MiNK is a clinical stage biopharmaceutical company focused on developing allogeneic invariant natural killer T (“iNKT”) cell therapies to treat cancer and other life-threatening immune diseases. MiNK’s most advanced product candidate, agenT-797, is an off-the-shelf, allogeneic, native iNKT cell therapy. MiNK is currently expanding its clinical programs, with a notable externally funded Phase 2 trial in second-line gastric cancer actively enrolling at Memorial Sloan Kettering Cancer Center. Additionally, MiNK is evaluating agenT-797 as a variant-agnostic therapy for patients with viral acute respiratory distress syndrome (“ARDS”) in planning for a randomized phase 2 study through a predominantly externally financed program. Recently, MiNK secured a $5.8 million private placement financing at a 25% premium, led by GKCC, LLC. This funding will propel the clinical development of MiNK-215, its leading allogeneic CAR-iNKT cell therapy targeting fibroblast activation protein (“FAP”) in solid tumors, which is scheduled to enter clinical trials in early 2025. In addition to its lead clinical program, MiNK has announced a collaboration with ImmunoScape, Inc. (“ImmunoScape”) to discover and develop next-generation T-cell receptor therapies targeting novel solid tumor antigens. This partnership leverages MiNK's proprietary library of T-cell antigens and ImmunoScape’s platform for rapid discovery of novel T-cell receptors.

Previous wording

We recognized research and development revenue of approximately $0.3 and $2.5 million during the three months ended June 30, 2024 and 2023, respectively. Research and development revenues in the second quarter of 2023 primarily consisted of $2.0 million related to the recognition of deferred revenue earned under our Gilead Collaboration Agreements.

Current wording

We did not recognize any research and development revenue in the three months ended September 30, 2024, but recognized research and development revenue of approximately $3.4 million during the three months ended September 30, 2023. Research and development revenues in the third quarter of 2023 primarily consisted of $2.9 million related to the recognition of deferred revenue earned under our Gilead Collaboration Agreements.

Previous wording

In January 2018, we sold 100% of our worldwide rights to receive royalties from GSK on sales of GSK’s vaccines containing our STIMULON QS-21 adjuvant to HCR. As described in Note F to our Condensed Consolidated Financial Statements, this transaction has been recorded as a liability that amortizes over the estimated life of our Royalty Purchase Agreement with HCR. As a result of this liability accounting, even though the royalties are remitted directly to HCR, we record these royalties from GSK as revenue. Non-cash royalty revenue related to our agreement with GSK increased $0.5 million, to approximately $22.6 million for the three months ended June 30, 2024, from $22.1 million for the three months ended June 30, 2023, due to increased net sales of GSK’s vaccines containing our STIMULON QS-21 adjuvant, including net sales of AREXVY, that GSK launched in the third quarter of 2023.

Current wording

In January 2018, we sold 100% of our worldwide rights to receive royalties from GSK on sales of GSK’s vaccines containing our STIMULON QS-21 adjuvant to HCR. As described in Note F to our Condensed Consolidated Financial Statements, this transaction has been recorded as a liability that amortizes over the estimated life of our Royalty Purchase Agreement with HCR. As a result of this liability accounting, even though the royalties are remitted directly to HCR, we record these royalties from GSK as revenue. Non-cash royalty revenue related to our agreement with GSK increased $4.3 million, to approximately $24.7 million for the three months ended September 30, 2024, from $20.4 million for the three months ended September 30, 2023, due to increased net sales of GSK’s vaccines containing our STIMULON QS-21 adjuvant, including net sales of AREXVY, that GSK launched in the third quarter of 2023.

Previous wording

Research and development expense includes the costs associated with our internal research and development activities, including compensation and benefits, occupancy costs, manufacturing costs, costs of consultants, and administrative costs. Research and development expense decreased 38% to $36.8 million for the three months ended June 30, 2024 from $59.3 million for the three months ended June 30, 2023. Decreased expenses in the three months ended June 30, 2024 primarily relate to a $14.3 million decrease in third-party services and other expenses, largely due to the timing of expenses related to the advancement of our antibody programs, a $3.8 million decrease in personnel related expenses, mainly due to a decrease in headcount, and a $6.1 million decrease in expenses attributable to the activities of our subsidiaries. These decreases were partially offset by a $1.8 million increase in other research and development expenses.

Current wording

Research and development expense includes the costs associated with our internal research and development activities, including compensation and benefits, occupancy costs, manufacturing costs, costs of consultants, and administrative costs. Research and development expense decreased 20% to $41.1 million for the three months ended September 30, 2024 from $51.4 million for the three months ended September 30, 2023. Decreased expenses in the three months ended September 30, 2024 primarily relate to a $4.2 million decrease in third-party services and other expenses, largely due to the timing of expenses related to the advancement of our antibody programs, a $2.9 million decrease in personnel related expenses, mainly due to a decrease in headcount, and a $4.1 million decrease in expenses attributable to the activities of our subsidiaries. These decreases were partially offset by a $0.8 million increase in other research and development expenses.

Previous wording

General and administrative expense consists primarily of personnel costs, facility expenses, and professional fees. General and administrative expenses decreased 18% to $16.8 million for the three months ended June 30, 2024 from $20.4 million for the three months ended June 30, 2023. Decreased expenses in the three months ended June 30, 2024 primarily relate to a $2.3 million decrease in personnel related expenses, mainly due to decreased share based compensation expense, a $0.5 million decrease in professional fees and a $0.9 million decrease in expenses attributable to the activities of our subsidiaries. These decreases were partially offset by a $0.1 million increase in other general and administrative expenses.

Current wording

General and administrative expense consists primarily of personnel costs, facility expenses, and professional fees. General and administrative expenses decreased 9% to $17.3 million for the three months ended September 30, 2024 from $18.9 million for the three months ended September 30, 2023. Decreased expenses in the three months ended September 30, 2024 primarily relate to a $1.0 million decrease in personnel related expenses, mainly due to decreased share based compensation expense, a $0.7 million decrease in professional fees and a $0.5 million decrease in expenses attributable to the activities of our subsidiaries. These decreases were partially offset by a $0.7 million increase in other general and administrative expenses.

Previous wording

Interest expense, net increased to approximately $31.7 million for the three months ended June 30, 2024 from $18.5 million for the three months ended June 30, 2023, mainly due to increased non-cash interest recorded in connection with our Royalty Purchase Agreement with HCR and the addition of non-cash interest expense recorded in connection with our Ligand Purchase Agreement.

Current wording

Interest expense, net increased to approximately $35.7 million for the three months ended September 30, 2024 from $18.6 million for the three months ended September 30, 2023, mainly due to increased non-cash interest recorded in connection with our Royalty Purchase Agreement with HCR and the addition of non-cash interest expense recorded in connection with our Ligand Purchase Agreement.

Previous wording

We recognized research and development revenue of approximately $0.3 million and $5.1 million during the six months ended June 30, 2024 and 2023, respectively. Research and development revenues in the first half of 2023 primarily consisted of $4.4 million related to the recognition of deferred revenue earned under our Gilead Collaboration Agreements.

Current wording

We recognized research and development revenue of approximately $0.3 million and $8.5 million during the nine months ended September 30, 2024 and 2023, respectively. Research and development revenues in the first nine months of 2023 primarily consisted of $7.2 million related to the recognition of deferred revenue earned under our Gilead Collaboration Agreements.

Previous wording

In January 2018, we sold 100% of our worldwide rights to receive royalties from GSK on sales of GSK’s vaccines containing our STIMULON QS-21 adjuvant to HCR. As described in Note F to our Condensed Consolidated Financial Statements, this transaction has been recorded as a liability that amortizes over the estimated life of our Royalty Purchase Agreement with HCR. As a result of this liability accounting, even though the royalties are remitted directly to HCR, we record these royalties from GSK as revenue. Non-cash royalty revenue related to our agreement with GSK increased $9.2 million, to approximately $50.3 million for the six months ended June 30, 2024, from $41.2 million for the six months ended June 30, 2023, due to increased net sales of GSK’s vaccines containing our STIMULON QS-21 adjuvant, including net sales of AREXVY, that GSK launched in the third quarter of 2023.

Current wording

In January 2018, we sold 100% of our worldwide rights to receive royalties from GSK on sales of GSK’s vaccines containing our STIMULON QS-21 adjuvant to HCR. As described in Note F to our Condensed Consolidated Financial Statements, this transaction has been recorded as a liability that amortizes over the estimated life of our Royalty Purchase Agreement with HCR. As a result of this liability accounting, even though the royalties are remitted directly to HCR, we record these royalties from GSK as revenue. Non-cash royalty revenue related to our agreement with GSK increased $13.5 million, to approximately $75.0 million for the nine months ended September 30, 2024, from $61.5 million for the nine months ended September 30, 2023, due to increased net sales of GSK’s vaccines containing our STIMULON QS-21 adjuvant, including net sales of AREXVY, that GSK launched in the third quarter of 2023.

Previous wording

Research and development expense includes the costs associated with our internal research and development activities, including compensation and benefits, occupancy costs, manufacturing costs, costs of consultants, and administrative costs. Research and development expense decreased 31% to $80.7 million for the six months ended June 30, 2024 from $116.4 million for the six months ended June 30, 2023. Decreased expenses in the six months ended June 30, 2024 primarily relate to a $21.7 million decrease in third-party services and other expenses, largely due to the timing of expenses related to the advancement of our antibody programs, a $5.9 million decrease in personnel related expenses, mainly due to a decrease in headcount, and a $10.5 million decrease in expenses attributable to the activities of our subsidiaries. These decreases were partially offset by a $2.5 million increase in other research and development expenses.

Current wording

Research and development expense includes the costs associated with our internal research and development activities, including compensation and benefits, occupancy costs, manufacturing costs, costs of consultants, and administrative costs. Research and development expense decreased 27% to $121.8 million for the nine months ended September 30, 2024 from $167.8 million for the nine months ended September 30, 2023. Decreased expenses in the nine months ended September 30, 2024 primarily relate to a $25.9 million decrease in third-party services and other expenses, largely due to the timing of expenses related to the advancement of our antibody programs, a $8.9 million decrease in personnel related expenses, mainly due to a decrease in headcount, and a $14.7 million decrease in expenses attributable to the activities of our subsidiaries. These decreases were partially offset by a $3.3 million increase in other research and development expenses.

Previous wording

General and administrative expense consists primarily of personnel costs, facility expenses, and professional fees. General and administrative expenses decreased 13% to $33.7 million for the six months ended June 30, 2024 from $38.7 million for the six months ended June 30, 2023. Decreased expenses in the six months ended June 30, 2024 primarily relate to a $2.3 million decrease in personnel related expenses, mainly due to decreased share based compensation expense, a $0.8 million decrease in professional fees and a $2.4 million decrease in expenses attributable to the activities of our subsidiaries. These decreases were partially offset by a $0.4 million increase in other general and administrative expenses.

Current wording

General and administrative expense consists primarily of personnel costs, facility expenses, and professional fees. General and administrative expenses decreased 11% to $50.9 million for the nine months ended September 30, 2024 from $57.6 million for the nine months ended September 30, 2023. Decreased expenses in the nine months ended September 30, 2024 primarily relate to a $3.2 million decrease in personnel related expenses, mainly due to decreased share based compensation expense, a $1.5 million decrease in professional fees and a $2.9 million decrease in expenses attributable to the activities of our subsidiaries. These decreases were partially offset by a $1.0 million increase in other general and administrative expenses.

Previous wording

Non-operating income increased $7.4 million for the three months ended June 30, 2024, from expense of $0.2 million for the three months ended June 30, 2023 to income of $7.1 million for the three months ended June 30, 2024, primarily due to the recognition of a $5.5 million gain on the early termination of two operating leases and the recognition of R&D tax credits in the UK in the three months ended June 30, 2024, compared to de minimis activity in the three months ended June 30, 2023.

Current wording

Non-operating income increased $5.8 million for the nine months ended September 30, 2024, from income of $0.2 million for the nine months ended September 30, 2023 to income of $6.1 million for the nine months ended September 30, 2024, primarily due to the recognition of a $5.3 million gain on the early termination of two operating leases and the recognition of R&D tax credits in the UK in the nine months ended September 30, 2024, compared to de minimis activity in the nine months ended September 30, 2023.

Previous wording

Interest expense, net increased to approximately $61.2 million for the six months ended June 30, 2024 from $35.1 million for the six months ended June 30, 2023, mainly due to increased non-cash interest recorded in connection with our Royalty Purchase Agreement with HCR and the addition of non-cash interest expense recorded in connection with our Ligand Purchase Agreement.

Current wording

Interest expense, net increased to approximately $96.9 million for the nine months ended September 30, 2024 from $53.7 million for the nine months ended September 30, 2023, mainly due to increased non-cash interest recorded in connection with our Royalty Purchase Agreement with HCR and the addition of non-cash interest expense recorded in connection with our Ligand Purchase Agreement.

Previous wording

For the six months ended June 30, 2024, our research and development programs consisted largely of our antibody programs as indicated in the following table (in thousands).

Current wording

For the nine months ended September 30, 2024, our research and development programs consisted largely of our antibody programs as indicated in the following table (in thousands).

Previous wording

We maintain an effective registration statement (the “Registration Statement”) covering up to $300.0 million of common stock, preferred stock, warrants, debt securities and units. The Registration Statement includes prospectuses covering the offer, issuance and sale of up to 6.7 million shares of our common stock from time to time in “at-the-market offerings” pursuant to an At Market Issuance Sales Agreement (the “Sales Agreement”) with B. Riley Securities, Inc. as our sales agent. We sold approximately 1.4 million and 405,000 shares of our common stock pursuant to the Sales Agreement during the six months ended June 30, 2024 and the period of July 1, 2024 through August 5, 2024, respectively, and received aggregate net proceeds totaling $25.3 million. As of August 5, 2024, approximately 6.2 million shares remained available for sale under the Sales Agreement.

Current wording

We maintain an effective registration statement (the “Registration Statement”) covering up to $300.0 million of common stock, preferred stock, warrants, debt securities and units. The Registration Statement includes prospectuses covering the offer, issuance and sale of up to 20.6 million shares of our common stock from time to time in “at-the-market offerings” pursuant to an At Market Issuance Sales Agreement (the “Sales Agreement”) with B. Riley Securities, Inc. as our sales agent. We sold approximately 1.9 million and 1.8 million shares of our common stock pursuant to the Sales Agreement during the nine months ended September 30, 2024 and the period of October 1, 2024 through November 8, 2024, respectively, and received aggregate net proceeds totaling $33.0 million. As of November 8, 2024, approximately 18.1 million shares remained available for sale under the Sales Agreement.

Previous wording

We have funded our operations largely from cash received from partners, royalty financing transactions and equity offerings. We transact at-the-market sales from time to time in order to manage our cash balances to make sure cash balances do not drop below a certain level based on our anticipated uses of cash. We execute at-the-market offerings based on market conditions and our stock price. We do not have in place a program whereby at-the-market offerings are executed automatically based on our trading volume.

Current wording

We have funded our operations largely from cash received from partners, royalty financing transactions and equity offerings. We transact at-the-market sales from time to time in order to manage our cash balances. We execute at-the-market offerings based on market conditions and our stock price. We do not have in place a program whereby at-the-market offerings are executed automatically based on our trading volume.

Previous wording

As of June 30, 2024, we had debt outstanding of $13.6 million in principal due February 2025.

Current wording

As of September 30, 2024, we had debt outstanding of $13.0 million in principal due February 2025.

Previous wording

Our cash and cash equivalents at June 30, 2024 were $93.7 million, an increase of $17.6 million from December 31, 2023. Cash and cash equivalents of our subsidiary, MiNK, at March 31, 2024, were $5.8 million. MiNK cash can only be accessed by Agenus through a declaration of a dividend by the MiNK Board of Directors or through settlement of intercompany balances.

Current wording

Our cash and cash equivalents at September 30, 2024 were $44.8 million, a decrease of $31.3 million from December 31, 2023. Cash and cash equivalents of our subsidiary, MiNK, at June 30, 2024, were $9.3 million. MiNK cash can only be accessed by Agenus through a declaration of a dividend by the MiNK Board of Directors or through settlement of intercompany balances.

Previous wording

Since our founding we have financed our operations principally through income and revenues generated from corporate partnerships, advance royalty sales and proceeds from equity issuances. Based on our current plans and projections, we believe that our cash resources of $93.7 million as of June 30, 2024, plus additional funding we may receive from multiple other sources, including out-licensing and/or partnering opportunities, will be sufficient to satisfy our liquidity requirements through the end of the year and into 2025. We are also in discussions with other parties to participate in the Purchase and Sale Agreement (see Note F) for up to an additional $125.0 million under the same terms as the Ligand transaction. In addition, we are in discussions with several potential corporate collaborators. These transactions could also extend our cash resources. However, because the completion of such transactions is not entirely within our control, in accordance with accounting guidance we are required to disclose that substantial doubt exists about our ability to continue as a going concern for a period of one year after the date of filing of this Quarterly Report on Form 10-Q. The financial statements have been prepared on a basis that assumes Agenus will continue as a going concern and which contemplates the realization of assets and satisfaction of liabilities and commitments in the ordinary course of business.

Current wording

Currently we are in discussions with several entities including biotechnology and pharmaceutical partners, as well as dedicated healthcare funds to provide the funding necessary to support our operations through our planned biologics license application, or marketing authorization, submission for botensilimab/balstilimab. However, because the completion of such transactions is not entirely within our control, in accordance with accounting guidance we are required to disclose that substantial doubt exists about our ability to continue as a going concern for a period of one year after the date of filing of this Quarterly Report on Form 10-Q. The financial statements have been prepared on a basis that assumes Agenus will continue as a going concern and which contemplates the realization of assets and satisfaction of liabilities and commitments in the ordinary course of business.

Previous wording

Management continues to address the Company’s liquidity needs and can exercise its flexibility to adjust spending as needed in order to preserve liquidity. In August 2023, we prioritized and focused our resources to accelerate the development, registration, and commercialization of our lead asset postponing all preclinical and other clinical programs and reducing our workforce by approximately 25%. Our CEO, Dr. Garo Armen has elected to receive his base salary and any potential bonus payments in stock rather than cash. We continuously evaluate the likelihood of success of our programs. As such, our decisions to continue to fund or eliminate funding of each of our programs are predicated on these determinations, on an ongoing basis. We expect our sources of funding to include payments from current collaborations which include out-licensing and/or partnering opportunities for our portfolio programs and product candidates with multiple parties; additional third-party agreements; asset sales; further royalty monetization; project financing, and/or sales of equity securities.

Current wording

Management continues to address the Company’s liquidity needs and has continued to adjust spending in order to preserve liquidity. In August 2023, we prioritized and focused our resources to accelerate the development, registration, and commercialization of our lead asset postponing all preclinical and other clinical programs and reducing our workforce by approximately 25%. Our CEO, Dr. Garo Armen has elected to receive his base salary and any potential bonus payments in stock rather than cash. We continuously evaluate the likelihood of success of our programs. As such, our decisions to continue to fund or eliminate funding of each of our programs are predicated on these determinations, on an ongoing basis. We expect our sources of funding to include payments from current collaborations which include out-licensing and/or partnering opportunities for our portfolio programs and product candidates with multiple parties; additional third-party agreements; asset sales; further royalty monetization; project financing, and/or sales of equity securities.

Previous wording

Our future cash requirements include, but are not limited to, supporting clinical trial and regulatory efforts and continuing our other research and development programs. Since inception, we have entered into various agreements with contract manufacturers, institutions, and clinical research organizations (collectively “third party providers”) to perform pre-clinical activities and to conduct and monitor our clinical studies and trials. Under these agreements, subject to the enrollment of patients and performance by the applicable third-party provider, we have estimated our total payments to be $663.4 million over the term of the related activities. Through June 30, 2024, we have expensed $582.9 million as research and development expenses and $541.9 million has been paid under these agreements. The timing of expense recognition and future payments related to these agreements is subject to the enrollment of patients and performance by the applicable third-party provider. We plan to enter into additional agreements with third party providers and we anticipate significant additional expenditures will be required to initiate and advance our various programs.

Current wording

Our future cash requirements include, but are not limited to, supporting clinical trial and regulatory efforts and continuing our other research and development programs. Since inception, we have entered into various agreements with contract manufacturers, institutions, and clinical research organizations (collectively “third party providers”) to perform pre-clinical activities and to conduct and monitor our clinical studies and trials. Under these agreements, subject to the enrollment of patients and performance by the applicable third-party provider, we have estimated our total payments to be $660.4 million over the term of the related activities. Through September 30, 2024, we have expensed $598.1 million as research and development expenses and $562.4 million has been paid under these agreements. The timing of expense recognition and future payments related to these agreements is subject to the enrollment of patients and performance by the applicable third-party provider. We plan to enter into additional agreements with third party providers and we anticipate significant additional expenditures will be required to initiate and advance our various programs.

Previous wording

Net cash used in operating activities for the six months ended June 30, 2024 and 2023 was $76.4 million and $118.6 million, respectively. Our future ability to generate cash from operations will depend on achieving regulatory approval and market acceptance of our product candidates, achieving benchmarks as defined in existing collaboration agreements, and our ability to enter into new collaborations. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Forward Looking Statements” in Part I, Item 2 of this Quarterly Report on Form 10-Q and the risks highlighted in Part I, Item 1A "Risk Factors" of our 2023 Form 10-K.

Current wording

Net cash used in operating activities for the nine months ended September 30, 2024 and 2023 was $129.7 million and $183.8 million, respectively. Our future ability to generate cash from operations will depend on achieving regulatory approval and market acceptance of our product candidates, achieving benchmarks as defined in existing collaboration agreements, and our ability to enter into new collaborations. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Forward Looking Statements” in Part I, Item 2 of this Quarterly Report on Form 10-Q and the risks highlighted in Part I, Item 1A "Risk Factors" of our 2023 Form 10-K, Part II and Item 1A "Risk Factors" of our Q2 2024 Form 10-Q.