Immunocore Holdings plc

Previous wording

You should read the following discussion and analysis of our financial condition and results of operations together with our condensed consolidated financial statements and the related notes thereto appearing elsewhere in this Quarterly Report. The following discussion is based on our financial information prepared in accordance with accounting principles generally accepted in the U.S. ("U.S. GAAP"), as found in the Accounting Standards Codification and Accounting Standards Update of the Financial Accounting Standards Board and the rules and regulations of the Securities and Exchange Commission ("SEC"). Some of the information contained in this discussion and analysis or set forth elsewhere in this Quarterly Report, including information with respect to our plans and strategy for our business, includes forward-looking statements that involve risks and uncertainties. We also recommend that you read our discussion and analysis of financial condition and results of operations together with our audited financial statements and notes thereto, and the section entitled “Risk Factors”, each of which appear in our Annual Report on Form 10-K for the year ended December 31, 2023 as filed with the SEC on February 28, 2024 (the "Annual Report") as well as the section titled “Special Note Regarding Forward-Looking Statements".

Current wording

You should read the following discussion and analysis of our financial condition and results of operations together with our condensed consolidated financial statements and the related notes thereto appearing elsewhere in this Quarterly Report. The following discussion is based on our financial information prepared in accordance with accounting principles generally accepted in the U.S. ("U.S. GAAP"), as found in the Accounting Standards Codification and Accounting Standards Update of the Financial Accounting Standards Board and the rules and regulations of the Securities and Exchange Commission ("SEC"). Some of the information contained in this discussion and analysis or set forth elsewhere in this Quarterly Report, including information with respect to our plans and strategy for our business, includes forward-looking statements that involve risks and uncertainties. We also recommend that you read our discussion and analysis of financial condition and results of operations together with our audited financial statements and notes thereto, and the section titled “Risk Factors” each of which appear in our Annual Report on Form 10-K for the year ended December 31, 2023 as filed with the SEC on February 28, 2024 (the "Annual Report") as well as the section titled “Special Note Regarding Forward-Looking Statements".

Previous wording

In 2022, we received approval for our lead product, KIMMTRAK, for the treatment of unresectable metastatic uveal melanoma from the FDA, the European Commission, and other health authorities. KIMMTRAK is now approved in 38 countries for the treatment of unresectable or mUM. We have launched KIMMTRAK in 19 countries globally to date and we plan to launch KIMMTRAK in additional countries, if approved in those countries, in 2024.

Current wording

In 2022, we received approval for our lead product, KIMMTRAK, for the treatment of unresectable metastatic uveal melanoma from the FDA, the European Commission, and other health authorities. KIMMTRAK is now approved in 38 countries for the treatment of unresectable or mUM. We have launched KIMMTRAK in 21 countries globally to date and we plan to launch KIMMTRAK in additional countries, if approved in those countries.

Previous wording

KIMMTRAK is the lead product from our ImmTAX platform and was the first approved new therapy in mUM in four decades. To date, we have treated over 2,000 cancer patients with KIMMTRAK, tebentafusp, and our other ImmTAX product candidates, which we believe is the largest clinical data set of any T cell engager bispecific in solid tumors and any TCR therapeutic. Our clinical programs are being conducted with patients with a broad range of cancers including melanoma, ovarian, lung, endometrial and colorectal, among others. We believe that these other tumor types have large addressable patient populations and significant unmet need. We are progressing three late-stage clinical programs within our ImmTAC (Immunem obilizingm onoclonal TCRs Against Cancer) portfolio, including KIMMTRAK and the PRAME-targeted brenetafusp (IMC-F106C).

Current wording

KIMMTRAK is the lead product from our ImmTAX platform and was the first approved new therapy in mUM in four decades. To date, we have treated over 2,000 cancer patients with KIMMTRAK, tebentafusp, and our other ImmTAX product candidates, which we believe is the largest clinical data set of any T cell engager bispecific in solid tumors and any TCR therapeutic. Our clinical programs are being conducted with patients with a broad range of cancers including melanoma, ovarian, lung, endometrial and colorectal, among others. We believe that these other tumor types have large addressable patient populations and significant unmet need. We are progressing three late-stage clinical programs within our ImmTAC (Immunem obilizingm onoclonal TCRs Against Cancer) portfolio, including KIMMTRAK and the PRAME-targeted brenetafusp.

Previous wording

We have incurred significant operating losses and expect to continue to incur significant expenses and operating losses for the near future. These net losses were $11.6 million and $36.1 million for the three and six months ended June 30, 2024, respectively. As of June 30, 2024, our accumulated deficit was $780.7 million. We expect to continue to incur significant and increasing expenses and to incur operating losses for the foreseeable future, as we advance our product candidates through preclinical and clinical development and seek regulatory approvals, manufacture drug product and drug supply, maintain and expand our intellectual property portfolio, as well as hire additional personnel, pay for further accounting, audit, legal, regulatory and consulting services, and pay costs associated with maintaining compliance with Nasdaq listing rules and the requirements of the SEC, director and officer liability insurance, investor and public relations activities and other expenses associated with operating as a public company.

Current wording

We have incurred significant operating losses and expect to continue to incur significant expenses and operating losses for the near future. We had net income of $8.7 million and a net loss of $27.3 million for the three and nine months ended September 30, 2024, respectively. As of September 30, 2024, our accumulated deficit was $772.0 million. We expect to continue to incur significant and increasing expenses and to incur operating losses for the foreseeable future, as we advance our product candidates through preclinical and clinical development and seek regulatory approvals, manufacture drug product and drug supply, maintain and expand our intellectual property portfolio, as well as hire additional personnel, pay for further accounting, audit, legal, regulatory and consulting services, and pay costs associated with maintaining compliance with Nasdaq listing rules and the requirements of the SEC, director and officer liability insurance, investor and public relations activities and other expenses associated with operating as a public company.

Previous wording

We do not expect to generate revenue from the sale of our other product candidates unless and until we successfully complete clinical development of and obtain regulatory approval for such product candidates. As a result, we may need additional funding to support our continued operations and pursue our clinical development and growth strategy. Until we can generate sufficient revenue from product sales, if ever, we expect to finance our operations through a combination of public or private equity offerings, debt financings, government funding arrangements, collaborations and marketing and distribution and licensing arrangements. We may be unable to raise additional funds or enter into such other arrangements on favorable terms, or at all, particularly in light of recently worsening macroeconomic conditions, such as supply chain disruptions, rising interest rates and volatility in the capital markets. If we fail to raise capital or enter into such arrangements as, and when, needed, we may have to significantly delay, scale back or discontinue the development and commercialization of one or more of our programs.

Current wording

We do not expect to generate revenue from the sale of our other product candidates unless and until we successfully complete clinical development of and obtain regulatory approval for such product candidates. As a result, we may need additional funding to support our continued operations and pursue our clinical development and growth strategy. Until we can generate sufficient revenue from product sales, if ever, we expect to finance our operations through a combination of public or private equity offerings, debt financings, government funding arrangements, collaborations and marketing and distribution and licensing arrangements. We may be unable to raise additional funds or enter into such other arrangements on favorable terms, or at all, particularly in light of recently worsening macroeconomic conditions, such as supply chain disruptions, fluctuations in interest rates and volatility in the capital markets. If we fail to raise capital or enter into such arrangements as, and when, needed, we may have to significantly delay, scale back or discontinue the development and commercialization of one or more of our programs.

Previous wording

Randomization in the ATOM Phase 3 trial, led by the European Organisation for Research and Treatment of Cancer (EORTC) is expected to start in the second half of 2024, with a potential data readout in 2028.

Current wording

Randomization in the ATOM Phase 3 trial, the only active registrational Phase 3 trial in adjuvant uveal melanoma, led by the European Organisation for Research and Treatment of Cancer ("EORTC") is expected to start in the fourth quarter of 2024.

Previous wording

These losses arise on a variety of items, including on U.S. dollar monetary assets and liabilities held by our main operating subsidiary in the United Kingdom, including our cash, cash equivalent and marketable securities balances. Our foreign currency losses can vary significantly between periods as a result of volatility in foreign exchange rates.

Current wording

These gains (losses) arise on a variety of items, including on U.S. dollar monetary assets and liabilities held by our main operating subsidiary in the United Kingdom, including our cash, cash equivalent and marketable securities balances. Our foreign currency gains (losses) can vary significantly between periods as a result of volatility in foreign exchange rates.

Previous wording

Unsurrendered tax losses are carried forward to be offset against future taxable profits. After accounting for tax credits receivable, there were accumulated tax losses available for carry forward in the United Kingdom of $324 million as of June 30, 2024. A full valuation allowance is recognized in respect of accumulated tax losses and other temporary differences in the United Kingdom because future profits are not sufficiently certain. A deferred tax asset is, however, recognized in respect of the subsidiary in the United States, relating to unused tax credits on share-based compensation expense and other temporary differences on the basis that we expect to continue generating U.S. taxable income against which deductible temporary differences can unwind.

Current wording

Unsurrendered tax losses are carried forward to be offset against future taxable profits. After accounting for tax credits receivable, there were accumulated tax losses available for carry forward in the United Kingdom of $320 million as of September 30, 2024. A full valuation allowance is recognized in respect of accumulated tax losses and other temporary differences in the United Kingdom because future profits are not sufficiently certain. A deferred tax asset is, however, recognized in respect of the subsidiary in the United States, relating to unused tax credits on share-based compensation expense and other temporary differences on the basis that we expect to continue generating U.S. taxable income against which deductible temporary differences can unwind.

Previous wording

As we begin to generate significant net product revenue, we may benefit from the U.K.’s “patent box,” which allows profits attributable to revenues from patents or patented products to be taxed at a lower rate than other revenue. The rate of tax for relevant streams of revenue for companies receiving this relief will be 10%.

Current wording

As we begin to generate significant net product revenue, we may benefit from the U.K.’s “patent box” regime, which allows profits attributable to revenues from patents or patented products to be taxed at a lower rate than other revenue. The effective rate of tax for relevant streams of revenue for companies receiving this relief is 10%.

Previous wording

For the three months ended June 30, 2024, we generated product revenue, net of $75.3 million due to the sale of KIMMTRAK, of which $55.6 million was in the United States, $15.4 million in Europe (including the impact of a net increase in estimated reserves related to prior periods of $6.7 million) and $4.3 million in International. Product revenue, net increased in the three months ended June 30, 2024 as compared to June 30, 2023, due primarily to increased volume in the United States and global country expansion, as we continued our commercialization efforts.

Current wording

For the three months ended September 30, 2024, we generated product revenue, net of $80.2 million due to the sale of KIMMTRAK, of which $57.3 million was in the United States, $21.0 million in Europe (including the impact of a net increase in estimated reserves related to prior periods of $3.6 million) and $1.9 million in International. Product revenue, net increased in the three months ended September 30, 2024 compared to the three months ended September 30, 2023, due primarily to increased volume in the United States and global country expansion, as we continued our commercialization efforts.

Previous wording

For the three months ended June 30, 2024, our R&D expenses were $51.1 million, as compared to $38.2 million for the three months ended June 30, 2023.

Current wording

For the three months ended September 30, 2024, our R&D expenses were $52.8 million, compared to $43.2 million for the three months ended September 30, 2023.

Previous wording

For the three months ended June 30, 2024, our internal R&D expenses increased by $1.9 million primarily due to an increase in headcount-related expenses as our number of employees and associated personnel costs increased with the growth of our clinical and preclinical programs partially offset by an increase in our R&D tax credits.

Current wording

For the three months ended September 30, 2024, our internal R&D expenses increased by $0.4 million primarily due to an increase in headcount-related expenses as our number of employees and associated personnel costs increased with the growth of our clinical and preclinical programs partially offset by an increase in our R&D tax credits.

Previous wording

For the six months ended June 30, 2024, our SG&A expenses were $77.9 million, compared to $67.6 million for the six months ended June 30, 2023, an increase of $10.3 million. Salaries and other employee-related costs increased by $7.8 million during the six months ended June 30, 2024, primarily due to the internalization of our U.S. sales force in the second half of 2023, for the three months ended June 30, 2023 these costs were included within selling and commercial costs. In addition, there was an increase in the number of employees engaged in business support functions, including medical and regulatory activities to support our growing pipeline and commercial activities.

Current wording

For each of the three months ended September 30, 2024 and 2023, our SG&A expenses were $35.5 million. Salaries and other employee-related costs increased by $4.3 million, primarily due to the internalization of our U.S. sales force in the fourth quarter of 2023, whereas these costs were included within selling and commercial costs for the three months ended September 30, 2023. In addition, there was an increase in the number of employees in medical and regulatory activities and business support functions, to support our growing pipeline and commercial activities. This was offset by a decrease in share-based compensation expense of $1.7 million due to higher estimated forfeitures in the three months ended September 30, 2024 and a decrease in other administrative expenses.

Previous wording

For the three months ended June 30, 2024, interest income was $6.2 million compared to $4.3 million for the three months ended June 30, 2023. This increase of $1.9 million reflects higher levels of cash and cash equivalents held in 2024 relative to 2023 due primarily to the net cash proceeds from the 2.5% convertible senior notes due in 2030 issued in February 2024 (the "Notes") and increases in interest rates earned on our cash and cash equivalents balances. For the three months ended June 30, 2024, interest expense was $4.3 million compared to $1.3 million for the three months ended June 30, 2023 and the increase was primarily related to interest on the Notes.

Current wording

For the three months ended September 30, 2024, interest income was $6.0 million compared to $5.1 million for the three months ended September 30, 2023. This increase of $0.9 million reflects higher levels of cash and cash equivalents held in 2024 relative to 2023 due primarily to the net cash proceeds from the convertible senior notes issued in February 2024 (the "Notes") and increases in interest rates earned on our cash and cash equivalents balances. For the three months ended September 30, 2024, interest expense was $4.3 million compared to $1.3 million for the three months ended September 30, 2023 and the increase was primarily related to interest on the Notes.

Previous wording

For the three months ended June 30, 2024, foreign currency loss was $0.5 million compared to a loss of $5.9 million for the three months ended June 30, 2023. This change of $5.4 million reflects less significant exchange rate movements in 2024 relative to 2023.

Current wording

For the three months ended September 30, 2024, foreign currency gain was $4.0 million compared to a gain of $11.2 million for the three months ended September 30, 2023. This decrease of $7.2 million reflects less significant exchange rate movements in the three months ended September 30, 2024 relative to the three months ended September 30, 2023.

Previous wording

Other income (expense), net consists primarily of the unrealized gains resulting from the change in fair value of our marketable securities and also includes loan and borrowing costs and other items.

Current wording

For the three months ended September 30, 2024, other income, net was $9.0 million compared to other expense, net of $0.2 million for the three months ended September 30, 2023. The change is primarily related to the unrealized gains resulting from the change in fair value of our marketable securities, which were purchased in 2024.

Previous wording

For the three months ended June 30, 2024, the income tax charge was $1.5 million compared to $0.2 million for the three months ended June 30, 2023.

Current wording

For the three months ended September 30, 2024, the income tax benefit was $2.6 million compared to $0.2 million for the three months ended September 30, 2023. This increase is related to a favorable discrete item for U.S. research tax credits claimed on our 2023 U.S. income tax return.

Previous wording

For the six months ended June 30, 2024, we generated product revenue, net of $145.7 million, due to the sale of KIMMTRAK, of which $105.6 million was in the United States, $34.4 million in Europe (including the impact of a net increase in estimated reserves related to prior periods of $11.2 million) and $5.7 million in International. Product revenue, net increased in the six months ended June 30, 2024 as compared to June 30, 2023, due primarily to increased volume in the United States and global country expansion, as we continued our commercialization efforts.

Current wording

For the nine months ended September 30, 2024, we generated product revenue, net of $225.9 million, due to the sale of KIMMTRAK, of which $162.9 million was in the United States, $55.5 million in Europe (including the impact of a net increase in estimated reserves related to prior periods of $12.6 million) and $7.6 million in International. Product revenue, net increased in the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023, due primarily to increased volume in the United States and global country expansion, as we continued our commercialization efforts.

Previous wording

Revenue from collaboration agreements decreased by $5.7 million to $0.2 million in the six months ended June 30, 2024, compared to $5.9 million for the six months ended June 30, 2023. This decrease was due to our February 2023 agreement with Genentech to close the Phase 1 clinical trial and for the parties to fulfill the remaining obligations under the terms of our Genentech collaboration.

Current wording

Revenue from collaboration agreements decreased by $7.9 million to $0.2 million in the nine months ended September 30, 2024, compared to $8.1 million for the nine months ended September 30, 2023. This decrease was due to our February 2023 agreement with Genentech to close the Phase 1 clinical trial and for the parties to fulfill the remaining obligations under the terms of our Genentech collaboration.

Previous wording

For the six months ended June 30, 2024, our R&D expenses were $108.5 million, as compared to $74.7 million for the six months ended June 30, 2023.

Current wording

For the nine months ended September 30, 2024, our R&D expenses were $161.3 million, compared to $118.0 million for the nine months ended September 30, 2023.

Previous wording

For the three months ended June 30, 2024, our external R&D expenses increased by $11.0 million primarily due to an increase of $10.9 million in expenses incurred for our PRAME programs as a result of the initiation of our registrational Phase 3 PRISM-MEL-301 clinical trial, scale-up of manufacturing and increase in the number of patients in combination expansions in our PRAME-A02 Phase 1 clinical trial.

Current wording

For the nine months ended September 30, 2024, our external R&D expenses increased by $42.3 million primarily due to an increase of $29.8 million in expenses incurred for our PRAME programs as a result of the initiation of our registrational Phase 3 PRISM-MEL-301 clinical trial, scale-up of manufacturing and increase in the number of patients in combination expansions in our PRAME-A02 Phase 1 clinical trial. R&D expenses incurred for our tebentafusp programs increased by $8.1 million primarily due to the advanced cutaneous melanoma ("TEBE-AM") and ATOM Phase 3 trials. All other external clinical and preclinical costs increased by $3.6 million due to continued progress in the pipeline.

Previous wording

For the six months ended June 30, 2024, our internal R&D expenses increased by $0.7 million primarily due to an increase in headcount-related expenses as our number of employees and associated personnel costs increased with the growth of our clinical and preclinical programs partially offset by an increase in our R&D tax credits.

Current wording

For the nine months ended September 30, 2024, our internal R&D expenses increased by $1.0 million primarily due to an increase of $5.5 million in headcount-related expenses as our number of employees and associated personnel costs increased with the growth of our clinical and preclinical programs partially offset by an increase in our R&D tax credits.

Previous wording

For the three months ended June 30, 2024, our SG&A expenses were $38.6 million compared to $35.0 million for the three months ended June 30, 2023, an increase of $3.6 million. Salaries and other employee-related costs increased by $2.2 million during the three months ended June 30, 2024, primarily due to the internalization of our U.S. sales force in the second half of 2023, for the three months ended June 30, 2023 these costs were included within selling and commercial costs. In addition, there was an increase in the number of employees engaged in business support functions, including medical and regulatory activities, to support our growing pipeline and commercial activities.

Current wording

For the nine months ended September 30, 2024, our SG&A expenses were $113.5 million, compared to $103.0 million for the nine months ended September 30, 2023, an increase of $10.4 million. Salaries and other employee-related costs increased by $12.1 million during the nine months ended September 30, 2024, primarily due to the internalization of our U.S. sales force in the fourth quarter of 2023, whereas for the nine months ended September 30, 2023 these costs were included within selling and commercial costs. In addition, there was an increase in the number of employees in medical and regulatory activities and business support functions to support our growing pipeline and commercial activities.

Previous wording

For the six months ended June 30, 2024, interest income was $14.5 million compared to $7.4 million for the six months ended June 30, 2023. This increase of $7.1 million reflects higher levels of cash and cash equivalents held in 2024 relative to 2023 due primarily to the net cash proceeds from the Notes issued in February 2024 and increases in interest rates earned on our cash and cash equivalents balances. For the six months ended June 30, 2024, interest expense was $7.5 million compared to $2.5 million for the six months ended June 30, 2023 and the increase was primarily related to interest on the Notes.

Current wording

For the nine months ended September 30, 2024, interest income was $20.4 million compared to $12.5 million for the nine months ended September 30, 2023. This increase of $7.9 million reflects higher levels of cash and cash equivalents held in 2024 relative to 2023 due primarily to the net cash proceeds from the Notes issued in February 2024 and increases in interest rates earned on our cash and cash equivalents balances. For the nine months ended September 30, 2024, interest expense was $11.8 million compared to $3.8 million for the nine months ended September 30, 2023 and the increase was primarily related to interest on the Notes.

Previous wording

Although we have recorded product revenue for sales of KIMMTRAK and have positive operating cash flows in the six months ended June 30, 2024, we have continued to incur operating losses and cumulative negative cash flows from our operations since our inception. We have an accumulated deficit of $780.7 million as of June 30, 2024.

Current wording

Although we have recorded product revenue for sales of KIMMTRAK, have positive operating cash flows in the nine months ended September 30, 2024 and have net income in the three months ended September 30, 2024, we have continued to incur operating losses and cumulative negative cash flows from our operations since our inception. We have an accumulated deficit of $772.0 million as of September 30, 2024.

Previous wording

Since our inception, we have funded our operations primarily with proceeds from sales of equity securities, debt financings and historical payments from our collaboration partners. Through June 30, 2024, we have raised an aggregate of $1,677 million. As of June 30, 2024 and December 31, 2023, we had cash, cash equivalents and marketable securities of $859.6 million and $442.6 million, respectively.

Current wording

Since our inception, we have funded our operations primarily with proceeds from sales of equity securities, debt financings and historical payments from our collaboration partners. Through September 30, 2024, we have raised an aggregate of $1,677 million. As of September 30, 2024 and December 31, 2023, we had cash, cash equivalents and marketable securities of $901.3 million and $442.6 million, respectively.

Previous wording

We entered into a loan with Pharmakon Advisors, LP (the "Pharmakon Loan Agreement") in November 2022, under which we have borrowed $50 million, which bears interest at a fixed rate of 9.75% and is due to mature in November 2028.

Current wording

We entered into a loan with Pharmakon Advisors, LP (the "Pharmakon Loan Agreement") in November 2022, under which we have borrowed $50 million, which bears interest at a fixed rate of 9.75% and is due to mature in November 2028. We intend to use a portion of our cash and cash equivalents to repay in full the loan outstanding under the Pharmakon Loan Agreement during the three months ending December 31, 2024. As of the date of this Quarterly Report, we have not yet repaid the loan outstanding under the Pharmakon Loan Agreement and this is included in our indebtedness as of September 30, 2024.

Previous wording

On February 2, 2024, we completed a private offering of$402.5 million aggregate principal amount of the Notes. Our net proceeds from the offering of the Notes were$389.1 million, after deducting the initial purchasers’ discounts and commissions and other offering expenses. The Notes are senior, unsecured obligations of the Company and will mature on February 1, 2030, unless earlier converted, redeemed or repurchased. The Notes will accrue interest payable semi-annually in arrears on February 1 and August 1 of each year, beginning on August 1, 2024, at a rate of 2.50% per year. Our intention is to use part of the proceeds to repay in full loans outstanding under the Pharmakon Loan Agreement in the fourth quarter of 2024. As of the date of this Quarterly Report, we have not yet repaid those loans and our indebtedness includes both the Pharmakon Loan Agreement and the Notes.

Current wording

On February 2, 2024, we completed a private offering of$402.5 million aggregate principal amount of the Notes. Our net proceeds from the offering of the Notes were$389.1 million, after deducting the initial purchasers’ discounts and commissions and other offering expenses. The Notes are senior, unsecured obligations of the Company and will mature on February 1, 2030, unless earlier converted, redeemed or repurchased. The Notes will accrue interest payable semi-annually in arrears on February 1 and August 1 of each year, beginning on August 1, 2024, at a rate of 2.50% per year.

Previous wording

Other than the above mentioned loan facilities, we currently have no ongoing material financing commitments, such as lines of credit or guarantees, that are expected to affect our liquidity over the next five years, other than our lease obligations and supplier purchase commitments.

Current wording

Other than the above mentioned indebtedness, we currently have no ongoing material financing commitments, such as lines of credit or guarantees, that are expected to affect our liquidity over the next five years, other than our lease obligations and supplier purchase commitments.

Previous wording

As of June 30, 2024, we had cash, cash equivalents and marketable securities of $859.6 million, as compared with $442.6 million as of December 31, 2023. Our working capital was $771.8 million as of June 30, 2024, as compared with $389.8 million as of December 31, 2023.

Current wording

As of September 30, 2024, we had cash, cash equivalents and marketable securities of $901.3 million, compared with $442.6 million as of December 31, 2023. Our working capital was $739.7 million as of September 30, 2024, compared with $389.8 million as of December 31, 2023.

Previous wording

Net cash provided by our operating activities was $18.9 million for the six months ended June 30, 2024, compared to cash provided by operating activities of $10.6 million for the six months ended June 30, 2023. The increase of $8.3 million in the six months ended June 30, 2024 was primarily due to increases in revenues, interest income and accrued expenses, partially offset by an increase in R&D expenses.

Current wording

Net cash provided by our operating activities was $40.0 million for the nine months ended September 30, 2024, compared to cash provided by operating activities of $20.7 million for the nine months ended September 30, 2023. The increase of $19.3 million in the nine months ended September 30, 2024 was primarily due to increases in net product revenue and accrued expenses, partially offset by an increase in operating expenses and prepayments and other current assets.

Previous wording

Net cash used in investing activities was $350.8 million and $4.4 million for the six months ended June 30, 2024 and 2023, respectively. The net cash used in investing activities increased for the six months ended June 30, 2024 due to purchases of marketable securities.

Current wording

Net cash used in investing activities was $351.6 million and $4.6 million for the nine months ended September 30, 2024 and 2023, respectively. The net cash used in investing activities increased for the nine months ended September 30, 2024 due to purchases of marketable securities.

Previous wording

Net cash provided by our financing activities during the six months ended June 30, 2024 was $395.2 million as compared to $17.7 million for the six months ended June 30, 2023. The increase of $377.5 million was the result of the net cash proceeds from the Notes of $389.1 million with no similar proceeds in the six months ended June 30, 2023.

Current wording

Net cash provided by our financing activities during the nine months ended September 30, 2024 was $395.4 million compared to $28.1 million for the nine months ended September 30, 2023. The increase of $367.3 million was the result of the net cash proceeds from the Notes of $389.1 million with no similar proceeds in the nine months ended September 30, 2023, partially offset by a decrease in exercise of share options.

Previous wording

We expect to continue to incur significant operating losses in the foreseeable future and expect our expenses to increase in connection with our ongoing activities, particularly as we continue to commercialize KIMMTRAK in additional territories, continue our research and development programs and the advancement of our product candidates through preclinical and clinical development, and seek regulatory approval and pursue commercialization of any approved product candidates. In addition, since our initial public offering in February 2021, we have incurred additional costs associated with operating as a public company, which could continue to increase further in future periods.

Current wording

We expect to continue to incur significant operating losses in the foreseeable future and expect our expenses to increase in connection with our ongoing activities, particularly as we continue to commercialize KIMMTRAK in additional territories, continue our research and development programs and the advancement of our product candidates through preclinical and clinical development, and seek regulatory approval and pursue commercialization of any approved product candidates.

Previous wording

•experience any delays, interruptions or encounter issues with any of the above, including any delays or other impacts as a result of the war in Ukraine, the state of war between Hamas and Israel, global geopolitical tension, worsening macroeconomic conditions, including supply chain disruptions, rising interest rates and inflation, and health epidemics or pandemics.

Current wording

•experience any delays, interruptions or encounter issues with any of the above, including any delays or other impacts as a result of the war in Ukraine, the conflict in the Middle East, global geopolitical tension, worsening macroeconomic conditions, including supply chain disruptions, fluctuations in interest rates and inflation, and health epidemics or pandemics.

Previous wording

In order to maintain such levels of expenditure and our anticipated expenditure, we may raise further funds by exploring debt or equity financing, or potentially further collaborations, in the future. The amount we are able to raise from these options can vary with market conditions, including the impacts of recently worsening macroeconomic conditions such as supply chain disruptions, rising interest rates and volatility in the capital markets, and our long-term strategy as a company is dependent on our ability to successfully raise such funding. Moreover, we have based our estimates on assumptions that may prove to be wrong, and we could use our available capital resources sooner than we currently expect.

Current wording

In order to maintain such levels of expenditure and our anticipated expenditure, we may raise further funds by exploring debt or equity financing, or potentially further collaborations, in the future. The amount we are able to raise from these options can vary with market conditions, including the impacts of macroeconomic conditions such as supply chain disruptions, fluctuations in interest rates and volatility in the capital markets, and our long-term strategy as a company is dependent on our ability to successfully raise such funding. Moreover, we have based our estimates on assumptions that may prove to be wrong, and we could use our available capital resources sooner than we currently expect.

Previous wording

We held cash, cash equivalents and marketable securities of $859.6 million as of June 30, 2024. Based on our current operating plans, we expect that our existing cash, cash equivalents and marketable securities, along with anticipated future revenue from KIMMTRAK, will enable us to fund our operating expenses and capital expenditure requirements for at least twelve months from the date of filing of this Quarterly Report. Given our need for additional financing to support the long-term clinical development of our programs, we may consider additional financing opportunities when market terms are favorable to us.

Current wording

We held cash, cash equivalents and marketable securities of $901.3 million as of September 30, 2024. Based on our current operating plans, we expect that our existing cash, cash equivalents and marketable securities, along with anticipated future revenue from KIMMTRAK, will enable us to fund our operating expenses and capital expenditure requirements for at least twelve months from the date of filing of this Quarterly Report. Given our need for additional financing to support the long-term clinical development of our programs, we may consider additional financing opportunities when market terms are favorable to us.

Previous wording

As part of our ongoing operations, we have material contractual lease obligations over expected lease terms of several years and expiry dates extending to 2043 primarily for our most significant facilities in the United Kingdom. These obligations and potential obligations could result in payments of up to $58.7 million. The majority of such payments represent longer-term commitments as outlined in the notes to our condensed consolidated financial statements. The lease agreements are cancellable assuming certain conditions are met prior to expiry. We expect to continue to incur expenses for such leases for the foreseeable future. As we continue to grow, launch further products or expand our operations in other countries, we may determine that it is necessary to enter into further lease agreements, which would further increase our cash outflows. Further obligations or commitments in the near term relate to our capital expenditure requirements for the purpose of improving our leased facilities. If we continue to grow, such commitments may become significant in value.

Current wording

As part of our ongoing operations, we have material contractual lease obligations over expected lease terms of several years and expiry dates extending to 2043 primarily for our most significant facilities in the United Kingdom. These obligations and potential obligations could result in payments of up to $69.2 million. The majority of such payments represent longer-term commitments as outlined in the notes to our condensed consolidated financial statements. The lease agreements are cancellable assuming certain conditions are met prior to expiry. We expect to continue to incur expenses for such leases for the foreseeable future. As we continue to grow, launch further products or expand our operations in other countries, we may determine that it is necessary to enter into further lease agreements, which would further increase our cash outflows. Further obligations or commitments in the near term relate to our capital expenditure requirements for the purpose of improving our leased facilities. If we continue to grow, such commitments may become significant in value.

Previous wording

We have a number of existing manufacturing obligations, some of which relate to the manufacture of KIMMTRAK. We have similar obligations related to our earlier stage programs. These obligations and potential obligations could result in payments of up to $15.5 million, and are expected to increase as we continue to commit to advancing the development of our brenetafusp (IMC-F106C) program in 2024 and beyond. While we have already incurred costs for commercial launches of KIMMTRAK in the United States, Europe and other territories, additional manufacturing obligations may arise in future in relation to product sales in these territories. We have also entered into third-party agreements relating to marketing and distribution of KIMMTRAK. The majority of such obligations have standard payment terms, and our level of non-cancellable commitments with such parties is not considered material. To meet demand, we may amend or enter into further agreements with CMOs or other parties which could cause our cash requirements to increase. While receipts from the sale of KIMMTRAK or other future products may fund our ongoing manufacturing and sales efforts, there can be no assurance that we will earn such revenues. In the longer term, if we received regulatory approval for our other product candidates, we would expect to incur significant commercialization expenses related to product manufacturing, sales, marketing and distribution, depending on where we choose to commercialize. We may also require additional capital to pursue in-licenses or acquisitions of other product candidates.

Current wording

We have a number of existing manufacturing obligations, some of which relate to the manufacture of KIMMTRAK. We have similar obligations related to our earlier stage programs. These obligations and potential obligations could result in payments of up to $26.0 million, and are expected to increase as we continue to commit to advancing the development of our brenetafusp (IMC-F106C) program in 2024 and beyond. While we have already incurred costs for commercial launches of KIMMTRAK in the United States, Europe and other territories, additional manufacturing obligations may arise in future in relation to product sales in these territories. We have also entered into third-party agreements relating to marketing and distribution of KIMMTRAK. The majority of such obligations have standard payment terms, and our level of non-cancellable commitments with such parties is not considered material. To meet demand, we may amend or enter into further agreements with CMOs or other parties which could cause our cash requirements to increase. While receipts from the sale of KIMMTRAK or other future products may fund our ongoing manufacturing and sales efforts, there can be no assurance that we will earn such revenues. In the longer term, if we received regulatory approval for our other product candidates, we would expect to incur significant commercialization expenses related to product manufacturing, sales, marketing and distribution, depending on where we choose to commercialize. We may also require additional capital to pursue in-licenses or acquisitions of other product candidates.

Previous wording

We are required to make interest payments for the Notes issued in February 2024. As of June 30, 2024, we had $402.5 million aggregate principal amount of the Notes outstanding, which will mature on February 1, 2030, unless earlier converted, redeemed or repurchased. See Note 5. “Non-current interest-bearing loans and borrowings” of the notes to our condensed consolidated financial statements in Part I of this Quarterly Report for further information.

Current wording

We are required to make interest payments for the Notes issued in February 2024. As of September 30, 2024, we had $402.5 million aggregate principal amount of the Notes outstanding, which will mature on February 1, 2030, unless earlier converted, redeemed or repurchased. See Note 5. “Current and non-current interest-bearing loans and borrowings” of the notes to our condensed consolidated financial statements in Part I of this Quarterly Report for further information.