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Item 7. Management’s Discussion and Analysis

2025-03-20 compared with 2024-03-20 · 186 added, 156 removed, 172 unchanged (67% of the section changed)

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As a result of many factors, including those factors set forth in the “Risk Factors” section of this Annual Report, our actual results could differ materially from the results described in, or implied by, the forward-looking statements contained in the following discussion and analysis.

You should carefully read the “Cautionary Note Regarding Forward Looking Statements” and “Risk Factors” sections of this Annual Report to gain an understanding of the important factors that could cause actual results to differ materially from our forward-looking statements contained in the following discussion and analysis.

We are a clinical-stage biopharmaceutical company developing novel T cell immunotherapeutic candidates designed to guide the immune system to overcome chronic infectious diseases, autoimmunity and cancer.

You should carefully read the “Special Note Regarding Forward Looking Statements” and “Risk Factors” sections of this Annual Report to gain an understanding of the important factors that could cause actual results to differ materially from our forward-looking statements contained in the following discussion and analysis.

We are a clinical-stage biopharmaceutical company focused on developing novel immunotherapeutic drug candidates for treating auto-immune and inflammatory diseases within the immunology and inflammation ("I&I") space.

Helping patients and their families is the guiding principle at the heart of Barinthus Bio.

The Company stands apart through its broad pipeline, built around four proprietary platform technologies;

two viral vector platforms, ChAdOx and MVA;

and two synthetic SNAP platforms, SNAP-Tolerance Immunotherapy ("SNAP-TI") and SNAP-Cancer Immunotherapy ("SNAP-CI").These platforms are enabling us to develop antigen-specific immunotherapeutic candidates designed to optimize the disease-fighting capabilities of T cells and guide them towards a healthy balance.

Our immunotherapeutic candidates are designed to work by increasing disease-specific CD8+ T cell activity in the case of chronic infectious diseases and cancers, or by dampening CD4+ and CD8+ T cells, and increasing regulatory T cells in autoimmunity.

Harnessing our range of proprietary viral vector and synthetic platform technologies, we are advancing a pipeline of four product candidates across a diverse range of therapeutic areas, including:

VTP-300, a Phase 2 immunotherapeutic candidate designed as a potential component of a functional cure for chronic HBV infection;

VTP-200, a Phase 2 non-surgical product candidate for persistent high-risk HPV with near term clinical read-outs;

VTP-1000, our first preclinical autoimmune candidate designed to utilize the SNAP-TI platform to treat patients with celiac disease;

and VTP-850, a second-generation Phase 2 immunotherapeutic candidate designed to treat recurrent prostate cancer.

Alongside these proprietary programs, we have partnerships in place to advance three additional prophylactic and therapeutic product candidates in MERS, Zoster and Non-Small Cell Lung Cancer ("NSCLC").

The Company also co-invented a COVID-19 vaccine with the University of Oxford, which has been exclusively licensed worldwide to AstraZeneca.

The co-invention of the COVID-19 vaccine demonstrated our ability to navigate a changing environment with speed and efficiency and lead the way in responding to urgent medical needs, as well as providing a strong proof-of-concept for the ChAdOx platform.

We believe our proven scientific expertise, diverse portfolio and focus on product candidate development uniquely positions us to navigate towards delivering treatments for patients with infectious diseases, autoimmune disorders and cancers that have a significant impact on their every day lives.

On May 4, 2021, we completed our IPO pursuant to which we issued and sold 6,500,000 American Depository Shares, or ADSs, at a public offering price of $17.00 per ADS, resulting in net proceeds of $102.8 million, after deducting underwriting discounts and commissions and offering expenses.

Prior to our IPO, we funded our operations primarily from private placements of our ordinary and preferred shares, private placements of loan notes convertible into ordinary shares, as well as from grants and licensing agreements, research tax credit payments, investments from non-controlling interest, and a $2.4 million upfront payment from OUI in July 2020 in connection with the Amendment, Assignment and Revenue Share Agreement, or the OUI License Agreement Amendment, related to the licensing of the COVID-19 vaccine, Vaxzevria.

We do not expect to generate revenue from any of our own product candidates, excluding Vaxzevria, until we

obtain regulatory authorization for one or more of such product candidates, if at all, and commercialize our products, or we enter into out-licensing agreements with third parties.

On August 9, 2022, we filed a Registration Statement on Form S-3, as amended (the "Shelf"), with the Securities and Exchange Commission in relation to the registration and potential future issuance of ordinary shares, including ordinary shares represented by ADSs, debt securities, warrants and/or units of any combination thereof in the aggregate amount of up to $200.0 million.

We aim to achieve this by developing truly transformational and highly disease-specific immunotherapies.

We are prioritizing the development of a pipeline for I&I indications enabled by our proprietary and highly differentiated platform for promoting immune tolerance, referred to as SNAP-TI, that are designed to guide patient's T cells to reduce inflammation and restore the natural state of immune non-responsiveness to healthy tissue.

Our lead candidate, VTP-1000, is designed to restore immune non-responsiveness to gluten in patients with celiac disease, and is currently being assessed in a Phase 1 clinical trial.

Based on encouraging preclinical data, we believe that the SNAP-TI platform has the potential to impact multiple other I&I indications.

We are also evaluating two product candidates to treat infectious diseases and cancer that harness our proprietary viral vector platform technologies, consisting of ChAdOx and MVA;

these technologies are designed to increase disease-specific CD8+ T cells.

These include:

VTP-300, a Phase 2 immunotherapeutic treatment modality that is a component of a treatment regimen to establish functional cure in patients who are chronically infected by the hepatitis B virus, and VTP-850, a second-generation immunotherapeutic candidate for the prevention of recurrence of prostate cancer.

VTP-850 is being tested in patients in a Phase 1 clinical trial in prostate cancer after surgical resection.

We intend to progress the development of these product candidates by completing the ongoing clinical trials, and seek a partner or collaborator for continuing development.

Alongside these proprietary programs, we have partnerships in place to advance additional prophylactic and therapeutic product candidates utilizing our viral vector platforms, including VTP-500 for Middle East Respiratory Syndrome, or MERS, VTP-400 for Herpes Zoster infections, and VTP-600 with potential for multiple cancer indications, including Non-Small Cell Lung Cancer ("NSCLC"), and Squamous Esophageal Cancer.

We also co-invented a COVID-19 vaccine with the University of Oxford, which was exclusively licensed worldwide to AstraZeneca U.K.

Limited ("AstraZeneca").

We believe our core capabilities at the intersection of T cell immunology and immunotherapeutic technology platforms combined with our track record of successfully executing development path activities uniquely position us to navigate towards delivering promising new treatments for patients with auto-immune and inflammatory diseases and building value for shareholders.

On August 9, 2022, we filed a Registration Statement on Form S-3, as amended, or the Shelf, with the Securities and Exchange Commission in relation to the registration and potential future issuance of ordinary shares, including ordinary shares represented by American Depositary Shares, or ADSs, debt securities, warrants and/or units of any combination thereof in the aggregate amount of up to $200.0 million.

The Shelf was declared effective on August 17, 2022.

We also simultaneously entered into a sales agreement with Jefferies LLC, as sales agent, providing for the offering, issuance and sale by us of up to an aggregate of $75.0 million of our ordinary shares represented by ADSs from time to time in “at-the-market” offerings under the Shelf.

As of December 31, 2023, we sold 1,139,444 ordinary shares represented by ADSs under the sales agreement, amounting to gross proceeds of $3.1 million.

As of December 31, 2024, we sold 2,558,586 ordinary shares represented by ADSs under the sales agreement, amounting to net proceeds of $5.1 million.

We have incurred net losses each year since inception through to December 31, 2021.

For the year ended December 31, 2022, we generated net income of $5.3 million, primarily as a result of revenues arising from AstraZeneca sales of Vaxzevria and our agreement with OUI.

For the year ended December 31, 2023, we incurred net losses of $73.4 million.

For the years ending December 31, 2024 and 2023, we incurred net losses of $61.2 million and $73.4 million, respectively.

As of December 31, 2024 and 2023, we had an accumulated deficit of $237.7 million and $176.6 million, respectively, and we do not currently expect profits or positive cash flows from operations in the foreseeable future.

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• sufficiency of our financial and other resources to complete the necessary preclinical studies and clinical trials;

• acceptance of INDs for our planned clinical trials or future clinical trials;

• acceptance of investigational new drug applications, or INDs, for our planned clinical trials or future clinical trials;

• successful and timely enrollment and completion of clinical trials;

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Furthermore, our operating plans may change in the future owing to research outcomes or other opportunities, and we may need additional funds to meet operational needs and capital requirements associated with such altered operating plans.

Unless and until we can generate a substantial amount of revenue from our product candidates, if approved, we expect to finance our future cash needs through public or private equity offerings, debt financings, collaborations, licensing arrangements or other sources, or any combination of the foregoing.

Based on our research and development plans, we expect that our existing cash and cash equivalents and other financial resources, will enable us to fund our operating expenses and capital expenditure requirements into the fourth quarter of 2025.

Unless and until we can generate a substantial amount of revenue from our product

candidates, if approved, we expect to finance our future cash needs through public or private equity offerings, debt financings, collaborations, licensing arrangements or other sources, or any combination of the foregoing.

Based on our research and development plans, we expect that our existing cash, cash equivalents and restricted cash and other financial resources, will enable us to fund our operating expenses and capital expenditure requirements to the start of 2027.

These estimates are based on assumptions that may prove to be wrong, and we could use our available capital resources more quickly than we expect.

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If we are unable to raise additional funds when needed, we would be required to delay, limit, reduce or terminate our product development or future commercialization efforts or grant rights to develop and market product candidates that we would otherwise prefer to develop and market ourselves.

Impact of Israel and Gaza Conflict

In respect of the international conflict in Israel and Gaza, we have no operations or suppliers based in Israel or Gaza, and as a result, as of the date of this Annual Report, we believe the impact on our business, operations and financial condition will be minimal.

Impact of the Ukraine Crisis

In respect of the international situation in Ukraine, we have assessed the impact on us as minimal.

We have no operations or suppliers based in Ukraine, Belarus, or Russia, and there is consequently no additional risk or negative impact on the consolidated financial statements.

Recent Developments

On January 10, 2025, we announced that we will prioritize I&I indications, including antigen-specific immune tolerance.

As a result, we have extended the cash runway to the start of 2027 by reducing forecasted costs, including a reduction in headcount by approximately 65% across both the U.K.

sites, and streamlining the operating costs of the business.

We estimate that the pre-tax costs of such reduction in workforce relating to employee severance and other employee-related costs may be approximately $2.5 million with the majority of such costs being incurred in the first half of 2025.

The estimates of the restructuring costs that we expect to incur and potential operating expense reductions, and the timing thereof, are subject to a number of assumptions and actual results may differ.

As part of the restructuring, two of the executive leadership team members based in the U.K., the Chief Operating Officer, Graham Griffiths, and Chief Financial Officer, Gemma Brown, will leave the Company.

Further plans for the re-organized team will be communicated in due course.

We will not invest in VTP-300 in chronic hepatitis B beyond the completion of the ongoing Phase 2b HBV003 clinical trial and will seek potential partners able to take advantage of its differentiated ability to achieve sustained HBsAg loss and functional cure in patients with low levels of HBsAg.

Impact of Israel and Gaza Conflict, Ukraine Crisis and Iran Conflict

In respect of the international conflict in Israel and Gaza, situation in Ukraine and Iran conflict, we have no operations or suppliers based in Israel or Gaza, or in Ukraine, Belarus, Russia or Iran, and as a result, as of the date of this Annual Report on Form 10-K, we believe the impact on our business, operations and financial condition will be minimal.

Impact of Global Economic Conditions and Inflationary Pressures

Instability in global economic conditions and geopolitical matters, as well as volatility in financial markets, could have a material adverse effect on our results of operations and financial condition.

These inflationary pressures and rising interest rates in the United States, the United Kingdom and elsewhere have given rise to increasing concerns that the U.S., U.K.

and other economies are now in, or may soon enter, economic recession.

Sustained inflationary pressures, increased interest rates, an economic recession or continued or intensified disruptions in the global financial markets could adversely affect our future financing capability or ability to access the capital markets.

Inflationary pressures, volatile interest rates, or intensified disruptions in the global financial markets could adversely affect our future financing capability or ability to access the capital markets.

Additionally, we may incur future increases in operating costs due to additional inflationary increases.

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Under this agreement, we are entitled to receive from OUI a share of payments, including royalties and milestones, received by OUI from AstraZeneca in respect of this vaccine.

On March 28, 2022, pursuant to the OUI License Agreement Amendment, we were notified of the commencement of payments, arising from AstraZeneca’s commercial sales of Vaxzevria.

Under the terms of an exclusive worldwide license agreement between OUI and AstraZeneca, OUI is entitled to milestone payments and royalties on commercial sales of Vaxzevria that began after the pandemic period.

As part of the assignment from us to OUI, we are entitled to receive approximately 24% of payments received by OUI from AstraZeneca.

Our revenue for the year ending December 31, 2023 was $0.8 million (year ended December 31, 2022 $43.7 million), representing the amounts we have been notified of as due by OUI to date and an estimate of future receipts, constrained to the extent that it is probable that a significant reversal of revenue would not occur.

We determined that we have no further performance obligations under the terms of the OUI License Agreement Amendment, which comprised the transfer of intellectual property rights only.

Accordingly, we plan to recognize these and any future amounts as revenue when earned, and it is probable that a significant reversal of revenue will not occur.

There is, however, no guarantee or expectation that such payments will continue in the future and, if they do, that we will be notified of such payments in a timely manner.

In March, 2022, we were notified by OUI of the commencement of payments to us arising from AstraZeneca’s commercial sales of Vaxzevria.

In May 2024, AstraZeneca announced the initiation of withdrawal of marketing authorization for Vaxzevria in Europe as demand had declined.

In October 2024, we were informed of additional amounts due to the Company from Oxford University Innovation Limited (OUI) in relation to the Company's share of royalties received by OUI as a result of prior commercial sales of Vaxzevria by AstraZeneca.

As a result, our revenue for the year ending December 31, 2024 was $15.0 million (year ended December 31, 2023 $0.8 million), representing the amounts we have been notified of as due by OUI to date.

We do not expect to receive any further payments relating to future commercial sales of Vaxzevria and, if such payments are due, that we will be notified of such payments in a timely manner.

Operating Expenses

Our operating expenses since inception have consisted of research and development costs and general administrative costs.

Our operating expenses since inception have consisted of research and development costs and general and administrative costs.

Research and Development Expenses

Since our inception, we have focused significant resources on our research and development activities, including establishing and building on our adenovirus platform, further enhancing our in-licensed ChAdOx1, ChAdOx2 and MVA vectors, developing new next generation adenoviral vector, acquiring new technology platforms including SNAP (SNAP-TI and SNAP-CI), conducting preclinical studies, developing various manufacturing processes, and advancing clinical development of our programs including Phase 2 clinical trials for VTP-100, which we subsequently discontinued development of, as well as initiating the clinical trials for VTP-200, VTP-300, VTP-600 and VTP-850 and readying, VTP-500 and VTP-1000 for clinical trials.

Research and development activities account for a large portion of our operating expenses, and we expect research and development expenses to increase in the future.

Since our inception, we have focused significant resources on our research and development activities, including establishing and building on our adenovirus platform, further enhancing our in-licensed ChAdOx1, ChAdOx2 and MVA vectors, acquiring new technology platforms including SNAP-TI and SNAP-CI, conducting preclinical studies, developing various manufacturing processes, initiating the clinical trials for VTP-1000, VTP-200, VTP-300, VTP-600, VTP-850 and readying VTP-500 for clinical trials.

Research and development activities account for a large portion of our operating expenses, and we expect research and development expenses for our ongoing clinical programs to increase in the future.

Research and development costs are expensed as incurred.

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• salaries, benefits and other related costs, including share-based compensation, for personnel engaged in research and development functions;

• expenses incurred in connection with the development of our programs including preclinical studies and clinical trials of our product candidates, under agreements with third parties, such as consultants, contractors, academic institutions and ("CROs");

• the cost of manufacturing drug products for use in preclinical development and clinical trials, including under agreements with third parties, such as contract manufacturing organizations, consultants and contractors;

• the cost of manufacturing drug products for use in preclinical development and clinical trials, including agreements with third parties, such as contract manufacturing organizations, consultants and contractors;

• laboratory costs;

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General and Administrative Expenses

Our general and administrative expenses consist primarily of personnel-related expenses, including share-based compensation, in our executive, finance, business development and other administrative functions.

Other general and administrative expenses include consulting fees and professional service fees for auditing, tax and legal services, rent expenses related to our offices, depreciation, foreign exchange gains and losses on our cash balances, other central non-research costs and changes in fair value of contingent consideration.

Significant judgment is used to determine the probability of success of achievement of the technology and clinical milestones and the date of the expected milestone used in the valuation model of the contingent consideration.

We expect our general and administrative expenses to continue to increase in the future as we expand our operating activities in both the United Kingdom and United States and potentially prepare for manufacturing and/or commercialization of our current and future product candidates.

These costs will increase as our headcount rises to allow full support for our operations as a public company, including increased expenses related to legal, accounting, regulatory and tax-related services associated with maintaining compliance with requirements of the

Nasdaq Global Market and the Securities and Exchange Commission, directors’ and officers’ liability insurance premiums and investor relations activities.

Our general and administrative expenses consist of personnel-related expenses, including share-based compensation, in our executive, finance, business development and other administrative functions.

Other general and administrative expenses include consulting fees and professional service fees for auditing, tax and legal services, rent expenses related to our offices, depreciation, impairment of long-lived assets, foreign exchange gains and losses on our cash balances, other central non-research costs and changes in the fair value of contingent consideration.

When determining the fair value of contingent consideration, significant judgment is used to determine the probability of success of achievement of the technology and clinical milestones and the date of the expected milestone.

We expect our general and administrative expenses to continue to increase in the future as we expand our operating activities and potentially prepare for manufacturing and/or commercialization of our current and future product candidates.

These costs will increase if our headcount rises to allow full support for our operations, including increased expenses related to legal, accounting, regulatory and tax-related services associated with maintaining compliance with requirements of the Nasdaq Global Market and the Securities and Exchange Commission, directors’ and officers’ liability insurance premiums and investor relations activities.

Other Operating Income

Other operating income includes grant income from CEPI Funding Agreement pursuant to which CEPI will provide funding to us to advance the development of VTP-500, our vaccine candidate against MERS.

When there is reasonable assurance that we will comply with the conditions attached to a received grant, and when there is reasonable assurance that the grant will be received, grant income is recognized as other operating income on a gross basis in the consolidated statements of operations and comprehensive loss on a systematic basis over the periods in which we recognize expenses for the related costs for which the grants are intended to compensate.

Payments received in advance of incurring reimbursable expenses are recorded as deferred income.

Any remaining unused amounts of the cash payments will be disclosed as restricted cash in the consolidated financial statements.

Other Income/ (Expense)

Interest Income

Interest income results primarily from the interest earned on our short-term cash deposits and cash balances held by Barinthus Biotherapeutics (UK) Limited in United States dollars and pounds sterling.

Interest income results primarily from the interest earned on our short-term cash deposits and cash balances held by Barinthus Biotherapeutics (U.K.) Limited.

Interest Expense

Interest expense results primarily from the asset retirement obligation provision discounted over the length of the lease in respect of our headquarters.

Interest expense results primarily from the asset retirement obligation discounted over the length of the relevant lease.

Research and Development Incentives

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We account for such relief received as other income.

The Company benefits from the United Kingdom research and development tax credit regime, being the Small and Medium-sized Enterprises R&D tax relief program ("SME Program"), and, to the extent that our projects are grant funded or relate to work subcontracted to us by third parties, the Research and Development Expenditure Credit program ("RDEC Program").

Until March 2023, under the SME Program, we were able to surrender some of its trading losses that arise from qualifying research and development activities for a cash rebate of (after taking into account the enhanced rate of deduction) up to 33.35% of such qualifying research and development expenditure.

Qualifying expenditures largely comprise employment costs for research staff, consumables, outsourced contract research organization costs and utilities costs incurred as part of research projects.

Certain staff, consumables (including utilities), subcontractors and externally provided workers qualifying research and development expenditures are eligible for a cash rebate of up to 21.67%.

We benefit from the United Kingdom research and development tax credit regime, being the Small and Medium-sized Enterprises R&D tax relief program or SME Program, and, to the extent that our projects are grant funded or relate to work subcontracted to us by third parties, the Research and Development Expenditure Credit program, or RDEC Program.

Qualifying expenditures largely comprise employment costs for research staff, consumables, outsourced contract research organization costs, externally provided workers and utilities costs incurred as part of research projects.

A large portion of costs relating to research and development, clinical trials and manufacturing activities are eligible for inclusion within these tax credit cash rebate claims.

From April 2023, under the SME Program the enhanced rate of deduction has decreased from 230% to 186%, the SME credit rate has was or has been reduced from 14.5% to 10% (except for R&D intensive SMEs, which are expected to benefit form a credit rate of 14.5%), and the SME cash rebate for us was or has been reduced from an effective rate of 33.35% to 18.6% (or 26.97% for R&D intensive SMEs) and from 21.67% to 12.1% for subcontractors.

Furthermore, the SME credit rate will decrease to 10% for expenditure incurred on or after April 1, 2023 unless the SME qualifies as an R&D intensive business, i.e., R&D expenditure constitutes at least 40% (from April 1, 2023) or 30% (from accounting periods starting on or after April 1, 2024) of total expenditure.

The Company may not be able to continue to claim research and development tax credits under the SME program in the future because it may no longer qualify as a small or medium-sized company.

In addition, the EU State Aid cap limits the total aid claimable in respect of a given project to €7.5 million which may impact our ability to claim R&D tax credits in future.

From March 2023, under the SME program, we are able to surrender some of our trading losses that arise from qualifying research and development activities for a cash rebate of up to 18.6% of such qualifying research and development expenditure, as the SME additional deduction is 86% and the SME credit rate is 10%, unless the SME qualifies as an R&D intensive business;

that is, R&D expenditure constitutes at least 40% (from April 1, 2023) or 30% (from accounting periods starting on or after April 1, 2024) of total expenditure.

From the analysis performed, we have not and do not currently expect to claim under the loss-making R&D Intensive Scheme for SMEs primarily due to the proportion of total relevant expenditure occurring outside the United Kingdom.

We may not be able to continue to claim research and development tax credits under the United Kingdom research and development tax credit regime because we may no longer qualify based on the eligibility criteria.

Further, the U.K.

Finance Act of 2021 introduced a cap on payable credit claims under the SME Program in excess of £20,000 with effect from April 2021 by reference to, broadly, three times the total Pay As You Earn ("PAYE"), and National Insurance Contributions ("NICs"), liability of the company, subject to an exception which prevents the cap from applying.

That exception requires the company to be creating, taking steps to create or managing intellectual property, as well as having qualifying research and development expenditure in respect of connected parties, which does not exceed 15% of the total claimed.

Finance Act of 2021 introduced a cap on payable credit claims under the SME Program in excess of £20,000 with effect from April 2021 by reference to, broadly, three times the total Pay As You Earn, or PAYE, and National Insurance Contributions, or NICs, liability, subject to an exception which prevents the cap from applying.

That exception requires us to create, take steps to create or manage intellectual property, as well as having qualifying research and development expenditure in respect of connected parties, which does not exceed 15% of the total claimed.

If such an exception does not apply, this could restrict the amount of payable credit that we claim.

For the year ended December 31, 2022, the R&D tax credits were further restricted by the available tax losses in the UK for the period.

There was no tax loss restriction applied to the R&D tax credits in the UK for the year ended December 31, 2023.

Unsurrendered UK losses may be carried forward indefinitely to be offset against future taxable profits, subject to numerous utilization criteria and restrictions.

The amount that can be offset each year is limited to £5.0 million plus an incremental 50% of UK taxable profits.

There was no tax loss restriction applied to the R&D tax credits in the U.K.

for the year ended December 31, 2023 and 2024.

The merged scheme Research & Development expenditure credit (RDEC) and enhanced R&D intensive support (ERIS) replaces the old RDEC and small and medium-sized enterprise (SME) schemes for accounting periods beginning on or after April 1, 2024.

For expenditure under the merged scheme, the rate of Research and Development expenditure credit will be 20%, which is the same as the rate under the old RDEC scheme for expenditure incurred on or after April 1, 2023.

For loss-makers and small profit-makers, a lower rate of notional tax restriction (currently 19%) applies at payment.

For all other companies, the restriction will continue to apply at the Corporation Tax main rate (currently 25%).

The amount of the PAYE cap for claims under both the merged scheme and ERIS is £20,000 plus 300% of the company’s relevant PAYE and National Insurance contributions liabilities.

The PAYE cap (where applicable) will limit the amount of payable credit that can be received in the accounting period under consideration.

Any excess over the cap will be carried forward and treated as an amount of Research and Development expenditure credit to which the company will be entitled for the next accounting period.

Based on prior claims and the split of qualifying spend it is expected that the PAYE cap is unlikely to affect the net benefit.

Furthermore, for accounting periods starting on or after April 1, 2024, legislation included in Finance Act 2024 restricts the extent to which payments to contractors for R&D, and externally provided workers can qualify for R&D relief where R&D activity takes place outside the U.K..

This may restrict the ability to include cost incurred on externally provided workers ("EPWs") based in the U.S.

and Switzerland for future accounting periods.

Unsurrendered U.K.

losses may be carried forward indefinitely to be offset against future taxable profits, subject to numerous utilization criteria and restrictions.

The amount that can be offset each year is limited to £5.0 million plus an incremental 50% of U.K.

taxable profits.

Critical Accounting Policies and Use of Estimates

This discussion and analysis of financial condition and results of operations is based on our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States ("GAAP").

The preparation of financial statements requires management to make estimates and judgments that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenue, income and expenses during the reporting period.

On an ongoing basis, management evaluates its estimates, including those related to fair value of contingent consideration and impairment of goodwill and intangible assets.

On an ongoing basis, management evaluates its estimates, including those related to fair value of contingent consideration and impairment of goodwill, intangible assets and other long-lived assets.

Management bases its estimates on historical experience and on various other market specific and relevant assumptions that management believes to be reasonable under the circumstances.

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We believe that the following accounting policies are critical to the process of making significant judgments and estimates in the preparation of our financial statements and understanding and evaluating our reported financial results.

Goodwill and Purchased Intangible Assets

We assess goodwill and intangible assets for impairment at least annually, or more frequently if events or changes in circumstances indicate that the carrying amounts may not be recoverable.

We assess goodwill for impairment at least annually, or more frequently if events or changes in circumstances indicate that the carrying amounts may not be recoverable.

We have elected to assess goodwill for impairment by first performing a qualitative assessment to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount as a basis of determining whether it is necessary to perform the quantitative goodwill impairment test.

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Because there are inherent uncertainties involved in these factors, significant differences between these estimates and actual results could result in future impairment charges and could materially impact our future financial results.

The goodwill of $12.2 million and the intangible asset of $25.1 million recognized as at December 31, 2023 wholly relate to the acquisition of Avidea on December 10, 2021.

The Company performed the annual impairment assessment as of December 31, 2023, to determine whether it is more likely than not that the fair value of the reporting unit is less than its carrying amount.

Based on this assessment, the Company has not recognized any impairment losses related to goodwill or intangible assets for the year ended December 31, 2023.

We performed the annual impairment assessment and identified qualitative indicators of impairment due to, most notably, the share price drop in November 2024, including the lack of recovery thereof, and the strategic considerations to partner VTP-300 for future clinical development.

From the qualitative assessment performed, we determined it was more likely than not that the fair value of the reporting unit was less than its carrying amount.

Therefore, we performed a quantitative assessment using the income approach, which resulted in the recognition of an impairment charge of $12.2 million.

Long-lived assets

We review long-lived assets to be held and used, including property and equipment, intangible assets and operating lease right-of-use assets, for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets or asset group may not be recoverable.

Evaluation of recoverability is first based on an estimate of undiscounted future cash flows resulting from the use of the asset or asset group and its eventual disposition.

In the event such cash flows are not expected to be sufficient to recover the carrying amount of the asset or asset group, the assets are written down to their estimated fair values.

Intangible assets

We have identified circumstances that could indicate that the carrying amount of our intangible assets may not be recoverable, being a sustained decline in the price of our ADSs, whereby the market capitalization continues to be below the value of our net assets, and during 2024, the strategic expected use of the SNAP platform shifted from being a complementary platform to the viral vector platform to being solely used in the development of novel immunotherapeutic candidates for treating autoimmune and inflammatory diseases, and being called SNAP-TI (Tolerance Immunotherapy).

Therefore, we performed a quantitative impairment assessment using the income approach as of December 31, 2024, and determined that the carrying amount of the Company's intangible assets are recoverable, hence no impairment loss related to long-lived assets has been recognized.

Operating lease right-of-use asset and property and equipment

We have also identified circumstances that could indicate that the carrying amount of our operating lease right-of-use asset and property and equipment in the U.K.

asset group may not be recoverable as of December 31, 2024, as it was more likely than not that we would cease the operating activities undertaken in the laboratory and office space in Harwell, Oxfordshire in 2025, significantly before the end of the previously estimated useful life.

Therefore, we performed an impairment assessment as of December 31, 2024 and determined that the carrying amounts of our operating lease right-of-use assets and property and equipment in the U.K.

asset group were not fully recoverable, and impairment charges of $2.6 million related to the U.K.

operating lease right-of-use asset and $2.7 million related to the U.K.

property and equipment have been recognized.

These impairment charges are subject to a number of assumptions and actual results may differ.

We will continue to refine these assumptions as additional information becomes available.

Contingent consideration

The Company recognizes a contingent consideration liability related to the acquisition of Avidea.

The liability is remeasured to fair value at each reporting date until the contingency is resolved.

The fair value of the contingent consideration is a Level 3 valuation determined using significant unobservable inputs being the probability of success of achievement of the milestones and the expected date of the milestone achievement.

Changes in fair value are recognized in general and administrative expenses in the consolidated statement of operations and comprehensive loss.

We recognize a contingent consideration liability related to the acquisition of Avidea.

Avidea’s stockholders may be entitled to receive an aggregate of up to $40.0 million in additional payments, payable in a combination of cash and ADSs, upon the achievement of certain milestones.

This contingent consideration is included within the purchase price and is recognized at its fair value on the acquisition date, and subsequently remeasured to fair value at each reporting date until the contingency is resolved.

The fair value of the contingent consideration is a Level 3 valuation determined using significant unobservable inputs, being the probability of pursuit of the activity associated with the milestone, the probability of success of the achievement of the milestone, the expected date of milestone achievement and applying the relevant discount rate.

Changes in fair value are recognized in general and administrative expenses in the consolidated statements of operations and comprehensive loss.

The fair value of contingent consideration is based on the probability of pursuit of the activity associated with the milestone, the probability of success of the achievement of the milestone, the expected date of milestone achievement and applying the relevant discount rate.

Results of Operations

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The following table sets forth the significant components of our results of operations (in thousands):

ended December

Revenue from Licenses, Grants and Services

Year ended December 31, 2024 Year ended December 31, 2023 Change

License revenue

$ 14,969 $ 802 $ 14,167

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General and administrative 29,670 39,842 (10,172)

Goodwill impairment 12,209 — 12,209

Total operating expenses 84,115 84,716 (601)

Other operating income

1,176 — 1,176

Loss from operations (67,970) (83,914) 15,944

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Research and development incentives 3,983 3,461 522

Other income, net 1,082 567 515

Total other income

7,392 4,891 2,501

(Loss)/profit before income tax

(76,522) 850 (77,372)

Other income 135 1,082 (947)

Total other income, net 6,743 7,392 (649)

Loss before income tax (61,227) (76,522) 15,295

Tax benefit 44 3,075 (3,031)

Net (loss)/income

$ (73,447) $ 5,321 $ (78,768)

For the year ended December 31, 2023, our revenue consisted of $0.8 million from the OUI License Agreement Amendment with respect to amounts owed to us by OUI for the commercial sales of Vaxzevria.

The decrease in revenue from the OUI License Agreement Amendment, compared to the prior period, resulted from substantially declined sales of Vaxzevria in 2023.

There is no guarantee that further payments will be received pursuant to the agreement in the future and, if such payments are made, that we will be notified of such payments in a timely manner.

For the year ended December 31, 2022, our revenue primarily consisted of $43.7 million from the OUI License Agreement Amendment with respect to amounts owed to us by OUI for the commercial sales of Vaxzevria, and $0.8 million attributable to upfront fees associated with a research and license agreement with Scancell.

Net loss $ (61,183) $ (73,447) $ 12,264

For the year ended December 31, 2024 and 2023, our revenue consisted of $15.0 million and $0.8 million, respectively from the OUI License Agreement Amendment with respect to amounts owed to us by OUI for the commercial sales of Vaxzevria.

The increase is due to the notification by OUI of additional commercial sales of Vaxzevria by AstraZeneca in prior periods.

In 2024, AstraZeneca announced it had made the strategic decision to initiate the withdrawal of marketing authorization for Vaxzevria within Europe, citing decline in demand as the reason for the decision.

We do not expect to receive any further payments relating to future commercial sales of Vaxzevria and, if such payments are due, that we will be notified of such payments in a timely manner.

Research and Development Expenses

The following table summarizes our research and development expenses for the years ended December 31, 2024 and 2023:

ended December

Year ended December 31, 2024 Year ended December 31, 2023 Change

Direct research and development expenses by program:

VTP-200 HPV $ 4,950 $ 4,050 $ 900

VTP-1000 Celiac 1

$ 5,486 $ 8,420 $ (2,934)

VTP-300 HBV 10,474 11,276 (802)

VTP-600 NSCLC 597 532 65

VTP-850 Prostate cancer 1,429 2,726 (1,297)

2,726 5,011 (2,285)

VTP-1000/VTP-1100 Celiac/HPV Cancer

VTP-200 HPV 2,009 4,950 (2,941)

VTP-600 NSCLC 2

473 597 (124)

VTP-500 MERS 3

Other and earlier stage programs 4

3,228 1,787 1,441

Total direct research and development expenses $ 23,709 $ 29,756 $ (6,047)

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Other indirect costs 1,411 1,077 334

1,077 291 786

Total indirect research and development expenses

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Total research and development expenses $ 42,236 $ 44,874 $ (2,638)

1 Research and development expenses related to VTP-1100 HPV Cancer were presented together with VTP-1000 Celiac in the prior period comparative, because our SNAP product candidates were both preclinical.

Expenses related to VTP-1100 HPV Cancer are now included in "Other and earlier stage programs," because we are deferring the planned IND application for VTP-1100 in HPV cancer and we have initiated the clinical trial for VTP-1000 Celiac.

2 The VTP-600 NSCLC/ESCC Phase 1/2a trial is sponsored by Cancer Research U.K.

3 The development of VTP-500 is funded pursuant to an agreement with the Coalition for Epidemic Preparedness Innovations (CEPI).

4 This includes $0.9 million of personnel-related indirect expenses relating to time spent progressing the VTP-500 MERS program, which is funded by CEPI.

Our research and development expenses for the years ended December 31, 2024 and 2023 were $42.2 million and $44.9 million, respectively, and consisted of direct and indirect research and development expenses.

Direct expenses for the years ended December 31, 2024 and 2023 were $23.7 million and $29.8 million, respectively, and consisted of outside services, consultants, laboratory materials, clinical trials, manufacturing of clinical trial materials, as well as costs for external preclinical services and sample testing.

Of the $0.6 million decrease, a $2.4 million decrease pertains to VTP-300 as a result of completing the HBV002 Phase 2 clinical trial with final data that was presented at the EASL Congress in June 2023, and continuing enrollment in the HBV003 Phase 2b clinical trial and the AB-729-202 Phase 2a clinical collaboration with Arbutus.

A $2.3 million decrease pertains to VTP-850 which is currently enrolling PCA001, a Phase 1/2 open-label clinical trial, compared to the prior year which was a result of manufacturing spend.

These decreases were partially offset by a $3.3 million increase in SNAP candidates, namely in VTP-1000 Celiac disease program costs which increased as the program progresses to regulatory submissions and towards the clinic.

Of the $6.0 million decrease, a $2.9 million decrease pertains to the completion of the VTP-1000 preclinical studies and initiation of the Phase 1 AVALON clinical trial in the third quarter of 2024 and the deprioritization of VTP-1100 for HPV cancer announced earlier in 2024, a $2.9 million decrease pertains to a reduction in clinical trial and manufacturing development costs for the VTP-200 HPV program following the completion of the Phase 1b/2 APOLLO (HPV001) clinical trial in 2024, a $1.3 million decrease pertains to reduced activity following completion of enrollment of the VTP-850 Phase 1 clinical trial in October 2024 and a $0.8 million decrease pertains to VTP-300 HBV clinical trial and manufacturing costs as enrollment for the two ongoing Phase 2 trials is now complete.

These decreases were partially offset by an increase of $1.4 million mainly relating to increased investment in our SNAP-TI platform and related early stage programs, as well as VTP-1100 HPV cancer expenses now being included in Other and earlier stage programs.

Indirect research and development expenses for the years ended December 31, 2024 and 2023 were $18.5 million and $15.1 million, respectively.

Of the $3.1 million increase, $2.3 million pertains to personnel-related expenses as a result of an increase in headcount across locations in the United Kingdom and United States and $0.8 million increase relates to other indirect cost mainly due to overhead allocations from the new U.S.

laboratory and office facility that we relocated to in June 2023.

Of the $3.4 million increase, $3.2 million relates to personnel-related expenses (including share-base compensation) primarily due to an average increase in headcount, severance cost of $1.0 million across our locations in the United Kingdom and United States following our announcement in June 2024 to prioritize our pipeline and more personnel time spent on research and development activities.

General and Administrative Expenses

General and administrative expenses for the years ended December 31, 2024 and 2023 were $29.7 million and $39.8 million, respectively.

The increase of $33.4 million relates primarily to a change in foreign exchange gains and losses of $33.8 million from a gain of $26.0 million for the year ended December 31, 2022 to a loss of $7.8 million for the year ended December 31, 2023.

The decrease of $10.1 million relates primarily to a change in foreign exchange gains and losses of $10.2 million from a loss of $7.8 million for the year ended December 31, 2023 to a gain of $2.4 million for the year ended December 31, 2024, as well as a $3.0 million decrease in personnel costs due to the reduction in our general and administrative workforce in the second quarter of 2024, more personnel time spent on research and development activities and a reduction in share-based payment charges due to the timing of high value awards, a decrease in insurance costs of $1.7 million related to a reduction in insurance premiums and a decrease of $0.8 million in professional costs due to reduced activity compared to the prior period.

These decreases are partially offset by an increase in the expense recognized for the fair value measurement of contingent consideration of $0.8 million following an increase in the determined probability of success of achieving the associated milestones and an impairment charge of $5.3 million recognized in respect of our operating lease right-of-use assets and property and equipment in the U.K.

(see Notes 6 Property and Equipment, Net and 17 Commitments and Contingencies in the financial statements for further details).

Goodwill Impairment Expense

For the years ended December 31, 2024 and 2023, goodwill impairment expense was $12.2 million and nil, respectively.

The increase relates to the impairment assessment performed during the fourth quarter of 2024, based on the expected utilization of Company assets and external market conditions.

Interest Income

For the years ended December 31, 2023 and 2022, interest income was $2.9 million and $3.1 million respectively, which primarily resulted from the interest earned on our short-term cash deposits and cash balances held by Barinthus Biotherapeutics (UK) Limited in United States dollars and pound sterling.

Interest Expense

For the year ended December 31, 2023, interest expense was $0.03 million which related to an asset retirement obligation provision discounted over the length of the lease term in respect of the laboratory and office facilities in the United Kingdom and the United States.

For the year ended December 31, 2022 interest expense was $0.02 million which related to an asset retirement obligation provision discounted over the length of the lease in respect of our headquarters in the United Kingdom, and $0.003 million interest paid on the debt recognized on the acquisition of Avidea, which was repaid in full in the first quarter of 2022.

For the years ended December 31, 2024 and 2023, interest income was $2.7 million and $2.9 million respectively, which primarily resulted from the interest earned on our short-term cash deposits and cash balances held by Barinthus Biotherapeutics (U.K.) Limited in United States dollars and pound sterling.

Research and Development Incentives

For the years ended December 31, 2023 and 2022, we accrued research and development incentives of $3.5 million and $1.2 million respectively, with the increase mainly attributable to an increase in losses available to surrender for the receipt of research and development incentives in Barinthus Biotherapeutics (UK) Limited due to a reduction in revenue received from commercial sales of Vaxzevria.

For the years ended December 31, 2024 and 2023, we accrued research and development incentives of $4.0 million and $3.5 million, respectively.

Such research and development incentives relate to corporation tax relief on research and development project incentive programs in the United Kingdom.

We account for such relief received as other income.

For the years ended December 31, 2023 and 2022, the tax benefit was $3.1 million and $4.5 million respectively, which primarily relates to movements in deferred tax resulting from the deferred tax liability recognized in respect of the acquired intangible asset.

The increase of $0.5 million is primarily due to an increase in qualifying research and development activities following completion and submission of the 2023 claim.

For the years ended December 31, 2024 and 2023, the tax benefit was $0.04 million and $3.1 million respectively, which primarily relates to movements in deferred tax.

Liquidity and Capital Resources

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Through December 31, 2024, we had received gross proceeds of approximately $330.1 million from the issuance of our ordinary and preferred shares and convertible loan notes.

As of December 31, 2023, we had cash and cash equivalents of $142.1 million.

As of December 31, 2024, we had cash, cash equivalents and restricted cash of $112.4 million.

Key financing and corporate milestones include the following:

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• In May 2021, we raised gross proceeds of $110.5 million from the IPO of our ordinary shares on NASDAQ.

• Between April 2022 and December 2023, we received $44.5 million of cash from OUI for the commercial sales of Vaxzevria.

• Between April 2022 and September 2024, we received $59.5 million of cash from OUI for the commercial sales of Vaxzevria.

• Between December 2022 and December 31, 2024, we raised net proceeds of $5.1 million from the issuance of 2,558,586 shares represented by ADSs through “at-the-market” offerings under the sales agreement with Jefferies LLC.

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As of December 31, 2023, we have sold 1,139,444 ordinary shares represented by ADSs under the sales agreement, amounting to net proceeds of $3.0 million.

We do not currently expect positive cash flows from operations in the foreseeable future, if at all.

In most periods, we have incurred operating losses as a result of ongoing efforts to develop our novel T cell immunotherapeutic candidates, including conducting ongoing research and development, preclinical studies, clinical trials, providing general and administrative support for these operations and developing our intellectual property portfolio.

We expect to continue to

incur net negative cash flows from operations for at least the next few years as we progress clinical development, seek regulatory approval, prepare for and, if approved, proceed to manufacture and commercialization of our most advanced product candidates.

We expect to continue to incur net negative cash flows from operations for at least the next few years as we progress clinical development, seek regulatory approval, prepare for and, if approved, proceed to manufacture and commercialization of our most advanced product candidates.

Operating profits may arise earlier if programs are licensed or sold to third parties before final approval, but this cannot be guaranteed.

The following table sets forth a summary of the primary sources and uses of cash (in thousands) for each period presented:

ended December

Year ended December 31, 2024 Year ended December 31, 2023

Net cash used in operating activities $ (28,940) $ (50,925)

1 unchanged sentence

Net cash provided by financing activities 2,163 1,872

Effect of exchange rates on cash and cash equivalents 2,171 187

Net decrease in cash and cash equivalents

$ (52,295) $ (19,669)

Effect of exchange rates on cash, cash equivalents and restricted cash (2,021) 2,171

Net decrease in cash, cash equivalents and restricted cash $ (29,690) $ (52,295)

Cash Used in Operating Activities

During the year ended December 31, 2024, net cash used in operating activities was $28.9 million, primarily resulting from our net loss of $61.2 million, adjusted by goodwill impairment expense of $12.2 million, depreciation and amortization of $5.8 million, an impairment charge of $5.3 million, share based compensation of $4.7 million, non-cash lease expenses of $1.4 million and changes in our operating assets and liabilities, net of $2.6 million primarily related to a $3.6 million decrease in prepaid expenses, a $1.8 million decrease in operating lease liabilities, a $1.7 million increase in deferred income, a $1.4 million increase in accounts payable and accrued expenses and a $2.3 million increase in research and development incentives receivable.

During the year ended December 31, 2023, net cash used in operating activities was $50.9 million, primarily resulting from our net loss of $73.4 million, adjusted by foreign exchange loss on translation of $7.5 million, share based compensation of $5.1 million, depreciation and amortization of $5.4 million, deferred tax benefit of $3.1 million and changes in our operating assets and liabilities, net decrease of $6.2 million primarily related to a $5.8 million decrease in accounts receivable, a $2.2 million decrease in prepaid expenses and other current assets, a $3.4 million decrease in accounts payable and a $2.0 million increase in accrued expenses.

During the year ended December 31, 2022, net cash used in operating activities was $14.4 million, primarily resulting from our net income of $5.3 million, adjusted by foreign exchange gain on translation of $24.8 million, share-based compensation of $9.9 million, depreciation and amortization of $4.3 million, and changes in our operating assets and liabilities, net of $5.5 million primarily resulting from the OUI receivable, and an increase in prepaid expense due to the payment of annual insurance premiums that occurred in the second quarter of 2022.

Net Cash Used in Investing Activities

During the year ended December 31, 2024, cash used in investing activities was $0.9 million primarily relating to lab and office equipment purchases in both our U.K.

During the year ended December 31, 2023, cash used in investing activities was $5.4 million primarily resulted from capital expenditures related to leasehold improvements on our new office in Germantown, Maryland, United States.

During the year ended December 31, 2022, cash used in investing activities was $5.8 million, primarily resulted from capital expenditures related to our new headquarters in Harwell, United Kingdom.

Net Cash Provided by Financing Activities

During the year ended December 31, 2023, cash provided by financing activities was $1.9 million primarily resulting from the issuance of ordinary shares in the form of ADSs through the “at-the-market” sales agreement with Jefferies LLC.

During the year ended December 31, 2022, cash provided by financing activities was $0.3 million resulting from $0.5 million from the issuance ordinary shares through the “at-the-market” sales agreement with Jefferies LLC, offset by $0.2 million repayment of debt incurred previously by the acquired company Avidea (acquired on December 10, 2021, that subsequently became Barinthus North America, Inc.).

During the years ended December 31, 2024 and 2023, cash provided by financing activities was $2.2 million and $1.9 million, respectively, primarily resulting from the issuance of ordinary shares in the form of ADSs through the “at-the-market” sales agreement with Jefferies LLC.

Effect of exchange rates on cash and cash equivalents

During the years ended December 31, 2023 and 2022, the effect of foreign exchange on cash and cash equivalents was a $2.2 million gain and $0.2 million gain respectively, primarily as a result of fluctuations between the United States dollar and pound sterling exchange rates.

During the years ended December 31, 2024 and 2023, the effect of foreign exchange on cash and cash equivalents was a $2.0 million loss and $2.2 million gain respectively, primarily as a result of fluctuations between the United States dollar and pound sterling exchange rates.

Future Funding Requirements

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As a result, we have incurred losses in each year since our inception in 2016, through to December 31, 2021.

We were profitable in 2022, however we have negative operating cash flows for the period ending December 31, 2023.

We were profitable in 2022, however we have negative operating cash flows for the periods ending December 31, 2024 and 2023.

As of December 31, 2024, we had an accumulated deficit of $237.7 million.

We expect to continue to incur significant losses and negative cash flows from operations for the foreseeable future.

We anticipate that our expenses will increase substantially as we:

We anticipate that our expenses will increase substantially if, and as we:

• pursue the clinical and preclinical development of our current product candidates;

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• seek marketing authorizations for product candidates that successfully complete clinical trials, if any;

• attract, hire and retain additional clinical, regulatory, quality control and other scientific personnel;

• establish our manufacturing capabilities through third parties or by ourselves and scale-up manufacturing to provide adequate supply for clinical trials and commercialization, including any manufacturing finishing and logistics personnel;

• expand our operational, financial and management systems and increase personnel appropriately, including personnel to support our manufacturing and commercialization efforts and our operations as a public company;

• maintain, expand, enforce, and protect our intellectual property portfolio as appropriate;

• establish sales, marketing, medical affairs and distribution teams and infrastructure to commercialize any products for which we may obtain marketing approval and intend to commercialize on our own or jointly;

• acquire or in-license other companies, product candidates and technologies;

• incur additional legal, accounting and other expenses in operating our business, including office expansion and the additional costs associated with operating as a public company.

Even if we succeed in commercializing one or more of our product candidates, we will continue to incur substantial research and development and other expenditure to develop and market additional product candidates.

We may encounter unforeseen expenses, difficulties, complications, delays and other factors that may adversely affect our business.

The size of our future net losses will depend on the rate of future growth of our expenses combined with our ability to generate revenue.

Our prior losses and expected future losses have had and will continue to have an adverse effect on our stockholders’ equity and working capital unless and until eliminated by revenue growth.

We may require substantial additional financing in the future to meet any such unanticipated factors and a failure to obtain this necessary capital could force us to delay, limit, reduce or terminate our product development programs, commercialization efforts or other operations.

Since our foundation, we have invested a significant portion of our efforts and financial resources in research and development activities for our ChAdOx1, ChAdOx2 and MVA technologies, acquisition of additional complementary platforms such as SNAP-TI and SNAP-CI, development of new technologies in house, and our product candidates derived from these technologies.

• attract, hire and retain additional clinical, regulatory, quality control and other personnel;

• conduct preclinical studies and clinical trials for our current and future product candidates based on our proprietary biologic and synthetic platforms, including the Chimpanzee Adenovirus Oxford ("ChAdOx") and Modified vaccinia Ankara ("MVA"), vectors, SNAP-TI, SNAP-CI and our other technologies;

• expand our operational, financial and management systems and increase personnel, including personnel to support our clinical development, manufacturing and commercialization efforts and our operations as a public company;

• establish our manufacturing capabilities through third parties or by ourselves and scale-up manufacturing to provide adequate supply for clinical trials and commercialization;

• expand, maintain, protect and enforce our intellectual property portfolio;

• establish a sales, marketing, medical affairs and distribution infrastructure to commercialize any products for which we may obtain marketing approval and intend to commercialize on our own or through a selected partner;

• acquire or in-license other product candidates and technologies for development and commercialization;

• incur additional legal, accounting and other expenses in operating our business, including the additional costs associated with operating as a public company.

Even if we succeed in commercializing one or more of our product candidates, we will continue to incur substantial research and development costs and other expenditures to develop and market additional product candidates and we may never generate revenue that is significant or large enough to achieve profitability.

We may also encounter unforeseen expenses, difficulties, complications, delays and other unknown factors that may adversely affect our business.

The size of our future net losses will depend, in part, on the rate of future growth of our expenses and our ability to generate revenue.

Our prior losses and expected future losses have had and will continue to have an adverse effect on our stockholders’ equity and working capital unless and until such losses are eliminated by revenue.

If we do achieve profitability, we may not be able to sustain or increase profitability on a quarterly or annual basis.

Accordingly, our failure to become and remain profitable would decrease the value of our company and could impair our ability to raise capital, maintain our research and development efforts, expand our business or continue our operations.

A decline in the value of our company also could cause you to lose all or part of your investment.

Since our foundation, we have invested a significant portion of our efforts and financial resources in research and development activities for our viral vector platform (ChAdOx and MVA), acquisition of additional complementary platforms such as SNAP-TI, development of new technologies in house, and our product candidates derived from these technologies.

Preclinical studies and especially clinical trials and additional research and development activities will require substantial funds to complete.

We believe that we will continue to expend substantial resources for the foreseeable future in connection with the development of our current product candidates and programs as well as any future product candidates we may elect to pursue, as well as the gradual gaining of control over our required manufacturing capabilities and other corporate functions.

These expenditures will include costs associated with conducting preclinical studies and clinical trials, obtaining regulatory approvals, and potentially in-house manufacturing and supply, as well as marketing and selling any products approved for sale.

These expenditures will include costs associated with conducting preclinical studies and

clinical trials, obtaining regulatory approvals, and potentially in-house manufacturing and supply, as well as marketing and selling any products approved for sale.

In addition, other unanticipated costs may arise as outlined above.

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• the timing of, success achieved and the costs involved in obtaining regulatory and marketing approvals and developing our ability to establish license or sale transactions and/or sales and marketing capabilities, if any, for our current and future product candidates if clinical trials and approval processes are successful;

• the success of our collaborations with CEPI, CanSino, CRUK and the Ludwig Institute and any future collaboration partners;

• the success of our collaborations with CEPI, Oxford University/OUI, Arbutus, CanSino, CRUK and the Ludwig Institute and any future collaboration partners;

• our ability to establish and maintain collaborations, strategic licensing or other arrangements and the financial terms of such agreements;

• the cost to the company of commercialization activities for our current and future product candidates that we may take on, whether alone or with a collaborator;

• the costs involved in preparing, filing, prosecuting, maintaining, expanding, defending and enforcing patent and other intellectual property claims, including litigation costs and the outcome of such litigation;

• the timing, receipt and amount of sales of, or royalties or other income from, our future products, if any;

• the emergence and success or otherwise of competing oncology and infectious disease therapies and other market developments.

• the costs of future commercialization activities, including product launch, product sales, marketing, manufacturing and distribution, for any of our current and future product candidates for which we receive marketing approval;

• the timing, receipt and amount of commercial sales, revenues, milestones or royalties or other income from our future products, should any of our product candidates receive marketing approval;

• the costs of preparing, filing and prosecuting patent applications, obtaining, maintaining, enforcing and protecting our intellectual property rights and defending intellectual property-related claims including litigation costs and any damages awarded in such litigation;

• the emergence and success or otherwise of competing autoimmune or infectious disease therapies and other market developments.

A change in the outcome of any of these or other variables with respect to the development of any of our current and future product candidates could significantly change the costs and timing associated with the development of that product candidate, in either direction.

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Unless and until we can generate a substantial amount of revenue from our product candidates, we expect to finance our future cash needs through public or private equity offerings, debt financings, collaborations, licensing arrangements or other sources, or any combination of the foregoing.

These estimates are based on assumptions that may prove to be wrong, and we could use our available capital resources more quickly than we expect.

We may require substantial additional financing in the future to meet any such unanticipated factors.

If we raise additional funds through collaborations, strategic alliances, distribution or licensing arrangements with third parties, we may have to relinquish valuable rights to our technologies, future revenue streams or product candidates or grant licenses on terms that may not be favorable to us.

Lease, Purchase, and Other Obligations

We have operating lease obligations related to our property and equipment.

If we are unable to raise additional funds when needed, we would be required to delay, limit, reduce or terminate our product development programs, future commercialization efforts, other operational plans or grant rights to develop and market product candidates that we would otherwise prefer to develop and market ourselves.

Other Obligations

We have operating lease obligations related to our property, plant and equipment.

The details of these leases are disclosed in Item 2.

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These contracts are generally cancellable by us upon prior notice.

Payments due upon

cancellation consist only of payments for services provided or expenses incurred, including noncancellable obligations of our service providers, up to the date of cancellation.

Payments due upon cancellation consist only of payments for services provided or expenses incurred, including noncancellable obligations of our service providers, up to the date of cancellation.

We have contingent payment obligations that we may incur upon achievement of clinical, regulatory and commercial milestones, as applicable, or royalty payments that we may be required to make under our licenses;

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Emerging Growth Company Status

We are an emerging growth company under the JOBS Act.

We are an emerging growth company under the Jumpstart Our Business Startups Act of 2012, as amended, or the JOBS Act.

As an emerging growth company, we may delay the adoption of certain accounting standards until those standards would otherwise apply to private companies.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 7. Management’s Discussion and Analysis