Immunocore Holdings plc 10-Q

Item 1. Financial Statements Immunocore Holdings plc Condensed Consolidated Balance Sheets (Unaudited) (In thousands, except share and per share data) March 31, 2025 December 31, 2024 Assets Current assets Cash and cash equivalents $ 476,845 $ 455,731 Marketable securities 360,185 364,645 Accounts receivable, net 63,094 63,009 Prepaid expenses and other current assets 41,697 41,033 Inventory, net 6,804 5,446 Total current assets 948,625 929,864 Property and equipment, net 9,770 10,092 Operating lease right of use assets, net 38,126 37,643 Deferred tax assets, net 14,355 14,790 Other non-current assets 17,132 17,117 Total assets $ 1,028,008 $ 1,009,506 Liabilities and shareholders’ equity Current liabilities Accounts payable $ 29,105 $ 25,100 Accrued expenses and other current liabilities 118,341 185,534 Operating lease liabilities, current 1,717 1,547 Total current liabilities 149,163 212,181 Accrued expenses, non-current 62,476 — Deferred revenue, non-current 5,612 5,434 Operating lease liabilities, non-current 40,748 40,162 Interest-bearing loans and borrowings 391,530 391,013 Total liabilities 649,529 648,790 Commitments and contingencies (Note 10) Shareholders’ equity Ordinary shares (voting and non-voting), £ 0.002 par value, most recent authority to allot up to a maximum nominal value of £ 97,234 and £ 97,454 shares as of March 31, 2025 and December 31, 2024, respectively, and 50,184,609 and 50,064,860 shares issued and outstanding as of March 31, 2025 and December 31, 2024, respectively. 135 135 Deferred shares, £ 0.0001 par value, 5,793,501 shares authorized, issued and outstanding as of March 31, 2025 and December 31, 2024. 1 1 Additional paid-in capital 1,202,171 1,190,104 Accumulated deficit ( 790,738 ) ( 795,761 ) Accumulated other comprehensive loss ( 33,090 ) ( 33,763 ) Total shareholders' equity 378,479 360,716 Total liabilities and shareholders' equity $ 1,028,008 $ 1,009,506 The accompanying notes form an integral part of these condensed consolidated financial statements. 2 Table of Contents Immunocore Holdings plc Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) (Unaudited) (In thousands, except share and per share data) Three Months Ended March 31, 2025 2024 Revenue: Revenue from sale of therapies, net $ 93,881 $ 70,342 Collaboration revenue — 160 Total revenue 93,881 70,502 Cost and operating expenses: Cost of revenue from sale of therapies ( 831 ) ( 246 ) Research and development expense ( 56,468 ) ( 57,459 ) Selling, general and administrative expense ( 40,198 ) ( 39,287 ) Loss from operations ( 3,616 ) ( 26,490 ) Other income (expense): Interest income 4,176 8,246 Interest expense ( 3,025 ) ( 3,239 ) Foreign currency gain (loss) 3,080 ( 2,406 ) Other income (expense), net 5,469 ( 190 ) Net income (loss) before income taxes 6,084 ( 24,079 ) Income tax expense ( 1,061 ) ( 357 ) Net income (loss) $ 5,023 $ ( 24,436 ) Other comprehensive income: Exchange differences on translation of foreign operations 673 897 Total comprehensive income (loss) $ 5,696 $ ( 23,539 ) Basic net income (loss) per share $ 0.10 $ ( 0.49 ) Basic weighted-average number of shares outstanding 50,086,684 49,877,218 Diluted net income (loss) per share $ 0.10 $ ( 0.49 ) Diluted weighted-average number of shares outstanding 51,949,798 49,877,218 The accompanying notes form an integral part of these condensed consolidated financial statements. 3 Table of Contents Immunocore Holdings plc Condensed Consolidated Statements of Shareholders’ Equity (Unaudited) (In thousands, except share data) Ordinary Shares Deferred Shares Additional Paid-in Capital Accumulated deficit Accumulated other comprehensive (loss) income Total Shareholders' Equity Shares Amount Shares Amount As of December 31, 2024 50,064,860 $ 135 5,793,501 $ 1 $ 1,190,104 $ ( 795,761 ) $ ( 33,763 ) $ 360,716 Net income — — — — — 5,023 — 5,023 Other comprehensive income — — — — — — 673 673 Exercise of share options 119,749 — — — 2,551 — — 2,551 Share-based compensation expense — — — — 9,516 — — 9,516 As of March 31, 2025 50,184,609 $ 135 5,793,501 $ 1 $ 1,202,171 $ ( 790,738 ) $ ( 33,090 ) $ 378,479 Ordinary Shares Deferred Shares Additional Paid-in Capital Accumulated deficit Accumulated other comprehensive (loss) income Total Shareholders' Equity Shares Amount Shares Amount As of December 31, 2023 49,725,649 $ 134 5,793,501 $ 1 $ 1,149,643 $ ( 744,674 ) $ ( 36,261 ) $ 368,843 Net loss — — — — — ( 24,436 ) — ( 24,436 ) Other comprehensive income — — — — — — 897 897 Exercise of share options 280,436 1 — — 5,212 — — 5,213 Share-based compensation expense — — — — 9,017 — — 9,017 As of March 31, 2024 50,006,085 $ 135 5,793,501 $ 1 $ 1,163,872 $ ( 769,110 ) $ ( 35,364 ) $ 359,534 The accompanying notes form an integral part of these condensed consolidated financial statements. 4 Table of Contents Immunocore Holdings plc Condensed Consolidated Statements of Cash Flows (Unaudited) (In thousands) Three Months Ended March 31, 2025 2024 Cash flows from operating activities Net income (loss) $ 5,023 $ ( 24,436 ) Adjustments for: Share-based compensation expense 9,489 8,964 Depreciation 854 1,011 Unrealized foreign exchange (gains) losses, net ( 2,907 ) 1,304 Unrealized gains on marketable securities ( 5,469 ) — Non-cash lease expense 546 432 Other 509 ( 2 ) Changes in assets and liabilities: Decrease (increase) in accounts receivable 836 ( 6,198 ) Increase in prepayments and other current assets ( 28 ) ( 1,819 ) Increase (decrease) in accounts payable 3,342 ( 2,320 ) (Decrease) increase in accrued expenses ( 10,943 ) 19,169 Increase (decrease) in operating lease liabilities 756 ( 490 ) Increase in other operating assets ( 1,573 ) ( 1,395 ) Increase in other operating liabilities — 1,193 Net cash provided by (used in) operating activities 435 ( 4,587 ) Cash flows from investing activities Proceeds from sale of marketable securities 10,000 — Purchase of property and equipment ( 298 ) ( 430 ) Net cash provided by (used in) investing activities 9,702 ( 430 ) Cash flows from financing activities Proceeds from exercise of share options 2,551 5,754 Proceeds from issue of convertible loan notes — 402,500 Payments for debt issuance costs — ( 12,242 ) Net cash provided by financing activities 2,551 396,012 Increase in net cash and cash equivalents 12,688 390,995 Net foreign exchange difference on cash held 8,426 ( 800 ) Cash and cash equivalents at beginning of period 455,731 442,626 Cash and cash equivalents at end of period 476,845 832,821 Supplemental disclosure of cash flow and non-cash information Cash (paid) received for interest, net $ ( 5,031 ) $ 5,141 Cash paid for income taxes, net $ ( 32 ) $ ( 140 ) Debt issuance costs in accrued expenses and other current liabilities $ — $ ( 1,116 ) The accompanying notes form an integral part of these condensed consolidated financial statements. 5 Table of Contents Immunocore Holdings plc Notes to the Condensed Consolidated Financial Statements (Unaudited) 1. Description of business Immunocore Holdings plc (collectively with its subsidiaries, the “Company”) is a public limited company incorporated in England and Wales and has the following wholly owned subsidiaries: Immunocore Limited, Immunocore LLC, Immunocore Commercial LLC, Immunocore Ireland Limited, Immunocore GmbH, and Immunocore Nominees Limited with operations based primarily in the United Kingdom and United States. The Company is pioneering and delivering transformative immunomodulating medicines to radically improve outcomes for patients with cancer, infectious diseases, and autoimmune diseases. Leveraging its proprietary, flexible, off-the-shelf ImmTAX ( I mmune m obilizing m onoclonal T CRs A gainst X disease) platform, the Company’s pipeline includes clinical and preclinical programs in oncology, infectious diseases, and autoimmune diseases. In January and April 2022, the Company received approval from the U.S. Food and Drug Administration ("FDA") and European Commission, ("EC"), respectively, for its lead product, KIMMTRAK, for the treatment of unresectable or metastatic uveal melanoma and has subsequently received approvals in further territories, and the Company continues to launch and seek approvals in additional territories. KIMMTRAK is now approved in 39 countries and the Company has commercially launched the product in 26 countries, including the United States, Germany and France, among other territories. 2. Summary of significant accounting policies Basis of presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States ("U.S. GAAP"), for interim financial reporting and pursuant to the requirements for reporting on Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information required for the full annual financial statements and should be read in conjunction with the annual consolidated financial statements of the Company for the year ended December 31, 2024, included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission (the "SEC"), on February 26, 2025 (the "Annual Report"). The accompanying condensed consolidated financial statements contain all normal recurring adjustments necessary to present fairly the financial position, results of operations, and cash flows for the interim periods reported. In the opinion of management, all adjustments considered necessary to present fairly the results of the interim periods have been included and consist only of normal and recurring adjustments. Certain information and footnote disclosures have been condensed or omitted as permitted under U.S. GAAP. The results for the three months ended March 31, 2025 are not necessarily indicative of the results to be expected for the year ending December 31, 2025, any other interim periods, or any future year or period. Use of estimates The preparation of the condensed consolidated financial statements in conformity with U.S. GAAP requires management to make judgments, estimates and assumptions. These judgments, estimates and assumptions affect the reported assets and liabilities as well as income and expenses in the financial period. The estimates and associated assumptions are based on information available when the condensed consolidated financial statements are prepared, historical experience and various other factors which are believed to be reasonable under the circumstances, the results of which form the basis of making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Existing circumstances and assumptions about future developments, however, may change due to market changes or circumstances arising that are beyond the Company’s control. Actual results could differ from those estimates. Estimates are primarily made in relation to revenue recognition, operating lease incremental borrowing rates, share-based compensation expense, clinical accruals, and deferred tax asset valuation allowances. 6 Table of Contents Fair value measurements Where financial and non-financial assets and liabilities are measured at fair value, the Company uses appropriate valuation techniques for which sufficient data are available, maximizing the use of relevant observable inputs and minimizing the use of unobservable inputs. As of March 31, 2025 and December 31, 2024, the Company held $ 351.8 million and $ 338.1 million, respectively, of money market funds required to be measured at fair value on a recurring basis within cash and cash equivalents. In addition, as of March 31, 2025 and December 31, 2024, the Company held $ 360.2 million and $ 364.6 million of marketable securities, respectively, including unrealized gains of $ 5.5 million for the three months ended March 31, 2025 and $ 14.6 million for the year ended December 31, 2024, respectively. The fair value of these cash equivalents and marketable securities is based on quoted prices from active markets (Level 1 inputs). Other financial instruments, although not recorded at fair value on a recurring basis, include cash, accounts receivable, accounts payable and debt obligations. The fair value of borrowings under the Notes (disclosed in Note 5. “Interest-bearing loans and borrowings”) were based on Level 2 inputs, which include observable inputs estimated using discounted cash flows and market-based expectations for interest rates, credit risk, and the contractual terms of debt instruments. After initial recognition, borrowings are measured at amortized cost using the effective interest method. Significant accounting policies With the exception of the below policy, the significant accounting policies used in the preparation of these condensed consolidated financial statements as of and for the three months ended March 31, 2025 are consistent with those disclosed in No te 2. "Summary of Significant Accounting Policies" in the audited consolidated financial statements for the year ended December 31, 2024, included in the Company’s Annual Report. Share-based compensation The Company operates equity-settled, share-based compensation plans whereby employees and directors are granted restricted share units ("RSUs") or options to purchase shares in the Company. The fair value of grants is expensed over the vesting period, which is the period in which the services are received. The majority of the Company’s awards have graded vesting schedules, and the expense for these awards is recognized over the requisite service period for each separate vesting portion as if the grant, in substance, represented multiple awards. The grant date fair value of RSUs is based on the market value of our shares on the date of grant. The grant date fair value of options is calculated using the Black Scholes valuation model. Estimation of the fair value of options requires judgement, including assumptions about the expected term of share-based options and expected volatility, which are used to determine the fair value of the Company’s options granted. The expected term is based on the Company’s assessment of the period within which participants are expected to exercise options, which requires consideration of employee groups, expected employee service, and other internal factors, and the degree to which these are expected to shorten the term of options in comparison to contractual expiry dates. Estimated expected volatility is based on the Company’s share price volatility since its IPO. The expected volatility reflects the assumption that the historical volatility over a period similar to the life of the awards is indicative of future trends, which may not necessarily be the actual outcome. The Company assumes no dividend payments for the purposes of estimating fair value and uses a zero-coupon U.S. Treasury yield curve applicable for the period of the expected term to form an estimate of the risk-free rate. Forfeitures expected to occur for options and RSU's are estimated by considering both market and company-specific data and the available internal information at the end of each reporting period. Recently issued and recently adopted accounting pronouncements On November 27, 2023, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which enhances segment disclosures and requires additional disclosures of segment expenses. This ASU is effective for annual periods in fiscal years beginning after December 15, 2023, and interim periods beginning after December 15, 2024. The Company adopted this ASU for the annual period ended December 31, 2024 and for the interim period ended March 31, 2025. The amendments have been applied retrospectively to all prior periods presented in the financial statements by expanding the Company's segment information disclosure in Note 9. "Segment information". 7 Table of Contents In December 2023, the FASB issued ASU 2023-09, Improvements to Income Tax Disclosures. This ASU improves the transparency of income tax disclosure by requiring consistent categories and greater disaggregation of information in the rate reconciliation, and income taxes paid disaggregated by jurisdiction. This guidance is effective for the Company for the year beginning January 1, 2025, with early adoption permitted. The amendments should be applied on a prospective basis, with retrospective application permitted. The Company is currently assessing the impact of this guidance on its disclosures. In November 2024, the FASB issued ASU 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40). This ASU requires disclosure in the notes to the financial statements, at each interim and annual reporting period, of specified information about certain costs and expenses including purchases of inventory, employee compensation, depreciation and intangible asset amortization included in each relevant expense caption. Also required is a qualitative description of the amounts remaining in relevant expense captions that are not separately disaggregated. This ASU is effective for all public entities for annual reporting periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027, and early adoption is permitted. This ASU should be applied either prospectively to financial statements issued after the effective date of this update or retrospectively to all prior periods presented in the financial statements. The Company is currently evaluating these new disclosure requirements and the impact of adoption on its financial statements. 3. Revenue During the three months ended March 31, 2025, the Company recognized $ 93.9 million (2024: $ 70.3 million) of net revenue from sale of therapies relating to the sale of KIMMTRAK primarily in the United States and Europe after estimated deductions for rebates, chargebacks and returns, which are recognized in Accrued expenses and other current liabilities and Accrued expenses, non-current, as set out in the Company’s accounting policies included in the Annual Report. Revenue from sale of therapies, net is presented by country / region based on the location of the end customer below (in thousands): Three Months Ended March 31, 2025 2024 United States $ 56,607 $ 50,026 Europe 32,804 18,952 International 4,470 1,364 Revenue from sale of therapies, net $ 93,881 $ 70,342 Revenue from sale of therapies, net for the three months ended March 31, 2025 includes $ 7.3 million (2024: $ 2.2 million), of partnered revenue under the Company's agreement with Medison Pharma Ltd. ("Medison"), and such revenue is split between its European and international markets. Accounts receivable from contracts with customers Accounts receivable as of March 31, 2025 and December 31, 2024 were $ 63.1 million and $ 63.0 million, respectively. An allowance for lifetime expected credit losses on accounts receivable is measured using historical credit loss experience, conditions at the end of each reporting period, and reasonable and supportable forecasts that affect collectability. Expected credit losses as of March 31, 2025 and December 31, 2024 were immaterial. Accruals for rebates, chargebacks and returns Current and non-current accruals for rebates, chargebacks and returns as of March 31, 2025 were as follows (in thousands): Rebates Chargebacks Returns Total As of December 31, 2024 $ 108,521 $ 2,038 $ 365 $ 110,924 Provisions related to sales in the period 30,983 8,542 2,771 42,296 Adjustments related to sales in prior periods ( 5,983 ) — — ( 5,983 ) Credits and payments made ( 14,828 ) ( 8,805 ) ( 2,310 ) ( 25,943 ) As of March 31, 2025 $ 118,693 $ 1,775 $ 826 $ 121,294 8 Table of Contents Included in the above are non-current accruals for rebates, chargebacks and returns of $ 61.8 million and $ 0 million as of March 31, 2025 and December 31, 2024, respectively, which are not required to be paid in the twelve months from the balance sheet date following additional information received in the three months ended March 31, 2025. The adjustments related to prior period sales in the period ended March 31, 2025 were due to changes in estimates primarily related to European pricing negotiations. Deferred revenue Non-current deferred revenue as of March 31, 2025 and December 31, 2024 relates to a revised distribution agreement with Medison entered into in November 2022. Under the revised agreement, the Company received a non-refundable payment of $ 5.0 million in exchange for granting Medison exclusive distribution rights in South America. The Company has determined that the deferred revenue relates to the Company’s single, combined performance obligation to supply KIMMTRAK to Medison and to grant Medison the exclusive right to distribute KIMMTRAK in South America. The Company expects to recognize this revenue within net revenue from sale of therapies following first commercial sale in the territory. As of March 31, 2025, the Company estimates that revenue recognition of this non-current deferred revenue will commence after one year or later. 4. Accrued expenses and other current liabilities Accrued expenses and other current liabilities consisted of the following (in thousands): March 31, 2025 December 31, 2024 Rebates, chargebacks and returns $ 59,479 $ 110,924 Clinical accruals 35,954 41,448 Employee related expenses 4,654 13,102 Contract manufacturing 7,087 4,764 Interest accruals 1,677 4,205 Commercial services 3,152 2,483 Other accruals 6,338 8,608 $ 118,341 $ 185,534 See Note 3. “Revenue” for a breakdown of rebates, chargebacks and returns. Clinical accruals primarily represent unbilled work undertaken by contract research organizations as part of the advancement of the Company's clinical programs. As of March 31, 2025, rebates, chargebacks and returns of $ 61.8 million were recorded in Accrued expenses, non-current, of which $ 45.9 million were reclassified from Accrued expenses and other current liabilities as of December 31, 2024 as they are no longer required to be paid in the twelve months from the balance sheet date following additional information received in the three months ended March 31, 2025. 5. Interest-bearing loans and borrowings Interest-bearing loans and borrowings consisted of the following as of March 31, 2025 (in thousands): Fair Value Principal Amount Unamortized Debt Issuance Costs Net Carrying Amount Amount Level Convertible senior notes $ 402,500 $ ( 10,970 ) $ 391,530 $ 337,979 Level 2 Interest-bearing loans and borrowings consisted of the following as of December 31, 2024 (in thousands): Fair Value Principal Amount Unamortized Debt Issuance Costs Net Carrying Amount Amount Level Convertible senior notes $ 402,500 $ ( 11,487 ) $ 391,013 $ 337,174 Level 2 9 Table of Contents Interest expense consisted of the following (in thousands): Three Months Ended March 31, 2025 2024 Convertible senior notes Coupon interest $ 2,516 $ 1,627 Amortization of debt issuance costs 509 319 Pharmakon loan $ — 1,293 Total interest expense $ 3,025 $ 3,239 Convertible senior notes On February 2, 2024, the Company completed a private offering (the "Offering") of $ 402.5 million aggregate principal amount of Notes, including the exercise in full of the initial purchasers’ option to purchase up to an additional $ 52.5 million principal amount of Notes. The Notes were issued pursuant to an indenture, dated February 2, 2024, as supplemented on March 17, 2025 (the "Indenture"), between the Company and U.S. Bank Trust Company, National Association, as trustee. The Company’s net proceeds from the Offering of the Notes were $ 389.1 million, after deducting issuance costs of $ 13.4 million. 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. Issuance costs incurred with the Notes were $ 13.4 million and are being amortized as interest expense on an effective interest rate method over the expected life of the Notes, through February 2030, at an effective interest rate of 3.06 %. Holders may convert all or any portion of their Notes at their option at any time prior to the close of business on the business day immediately preceding the maturity date into American Depositary Shares ("ADSs") of the Company. The Notes have an initial conversion rate of 10.5601 ADSs per $ 1,000 principal amount of the Notes, which will be subject to anti-dilution adjustments in certain circumstances. This represented an initial conversion price of $ 94.70 per ADS. The number of shares that would be issuable assuming conversion of all of the Notes is 5,950,600 (assuming the maximum increase to the conversion rate in connection with a “make-whole fundamental change” (as defined in the Indenture)). Following certain corporate events that occur prior to the maturity date of the Notes or if the Company delivers a notice of optional redemption or a notice of tax redemption, the Company shall, in certain circumstances, increase the conversion rate for a holder of the Notes who elects to convert its notes in connection with such a corporate event or convert its notes called (or deemed called) for redemption in connection with such notice of optional redemption or notice of tax redemption, as the case may be. The Company may not redeem the Notes prior to February 5, 2027, except in the event of certain tax law changes as described below and in the Indenture. The Company may redeem for cash all or any portion of the Notes (subject to the partial redemption limitation described in the Indenture), at its option, on or after February 5, 2027 if the last reported sale price of the ADSs has been at least 130 % of the conversion price for the Notes then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which the Company provides notice of optional redemption, at a redemption price equal to 100 % of the principal amount of the Notes to be redeemed, plus accrued and unpaid interest to, but excluding, the optional redemption date. If, as a result of certain changes in the law of any relevant tax jurisdiction, the Company would be required to pay additional amounts (as defined in the Indenture) on the Notes, the Company may redeem the Notes in whole, but not in part, at a tax redemption price of 100 % of the aggregate principal amount thereof, plus accrued and unpaid interest to, but excluding, the tax redemption date and all additional amounts, if any, which otherwise would be payable to the date of tax redemption. Upon the Company giving notice of a tax redemption, a holder may elect not to have its Notes redeemed, in which case the holder would not be entitled to receive any additional amounts with respect to its Notes after the tax redemption date. 10 Table of Contents If the Company undergoes a fundamental change, holders may require the Company to repurchase for cash all or any portion of their Notes at a repurchase price equal to 100 % of the principal amount of the Notes to be repurchased, plus accrued and unpaid interest to, but excluding, the fundamental change repurchase date. Pharmakon loan On November 8, 2022, the Company entered into the Pharmakon loan agreement (the "Pharmakon Loan Agreement"), providing for term loans to the Company in an aggregate principal amount of up to $ 100 million to be funded in two tranches. The first tranche of $ 50 million bore interest at a fixed rate of 9.75 %, which was payable quarterly in arrears, with payments commencing in 2023. The Company was also required to pay a further fee of $ 1.25 million at the latest by June 2024, regardless of whether it elected to draw down on the second $ 50 million tranche under the Pharmakon Loan Agreement. The Company elected not to exercise the option to draw down the second tranche and made the payment of $ 1.25 million in June 2024. On November 8, 2024, the Company repaid in full the loan outstanding under the Pharmakon Loan Agreement. 6. Share-based compensation The following table shows the total share-based compensation expense recorded in the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) (in thousands): Three Months Ended March 31, 2025 2024 Research and development $ 2,181 $ 1,980 Selling, general and administrative $ 7,308 $ 6,984 Equity Incentive Plan Under the Company’s Equity Incentive Plan ("EIP"), the Company may grant market value options, share appreciation rights or restricted shares, restricted share units, performance share units and other share-based awards to the Company’s employees. The Company’s board members and consultants are eligible to receive awards under the Company’s non-employee sub-plan to the EIP. Awards may be granted at such times as the Company may determine, but will generally be granted annually following the end of the financial year. Awards vest at such times and as specified in the award agreement, typically being over a four-year period although the Company retains the discretion to provide for other vesting schedules. If the participant violates the non-competition, non-solicitation, confidentiality or other similar restrictive covenant provisions of any employment contract, the right of the participant to receive these shares on vesting shall terminate immediately. The Company maintains discretion over the type and terms of equity awards granted. Share options lapse on the tenth anniversary from the date of grant, and they are not subject to performance conditions or entitled to dividends. The Company has reserved 6,250,865 authorized shares for future issuance under the EIP. The number and weighted average exercise prices of share options were as follows: Number of Share Options Weighted Average Exercise Price Weighted Average Remaining Contractual Term Aggregate Intrinsic Value (in thousands) Outstanding as of December 31, 2024 9,422,875 $ 31.14 6.0 years $ 50,455 Awards granted 1,529,159 29.57 Awards exercised ( 119,749 ) 21.34 Awards forfeited ( 13,193 ) 56.49 Awards expired ( 7,176 ) 48.79 Outstanding as of March 31, 2025 10,811,916 $ 30.99 6.4 years $ 50,832 Exercisable as of March 31, 2025 7,817,348 $ 26.56 5.4 years $ 49,489 As of March 31, 2025, total unrecognized compensation expense related to share options granted but not vested was $ 36.6 million, which the Company expects to recognize over a remaining weighted-average period of 1.9 years. 11 Table of Contents Awards granted in the three months ended March 31, 2025 and 2024 have been valued using the Black-Scholes option pricing model. The assumptions used in the models for share options granted were as follows: Three Months Ended March 31, 2025 2024 Share price at grant date $ 29.21 - $ 29.60 $ 67.51 - $ 70.50 Exercise price $ 29.21 - $ 29.60 $ 67.51 - $ 70.50 Expected volatility 53.30 % - 55.78 % 59.94 % - 66.17 % Expected life 5.5 years 5 years - 5.5 years Risk free rate 4.14 % - 4.41 % 3.93 % - 4.30 % Fair value $ 15.70 - $ 16.21 $ 39.50 - $ 40.47 Restricted share unit activity In February 2025, the Company granted RSU awards that vest over a four-year service period with 25 % on each anniversary of the grant date. An RSU award represents the right to receive one of the Company’s ADSs upon vesting of the RSU. The fair value of each RSU award is based on the closing price of the Company’s ADSs on Nasdaq on the date of grant. The number and weighted average fair value of RSUs were as follows: Number of RSUs Weighted Average Grant Date Fair Value Unvested and outstanding as of December 31, 2024 — $ — Awards granted 485,140 29.60 Awards vested — — Awards forfeited — — Unvested and outstanding as of March 31, 2025 485,140 $ 29.60 As of March 31, 2025, total unrecognized compensation expense related to RSUs granted but not vested was $ 12.0 million, which the Company expects to recognize over a remaining weighted-average period of 2.4 years. 7. Basic and diluted net income (loss) per share Basic and diluted net income (loss) per share is calculated as follows (in thousands, except share and per share amounts): Three Months Ended March 31, 2025 2024 Net income (loss) $ 5,023 $ ( 24,436 ) Basic weighted-average number of shares outstanding 50,086,684 49,877,218 Adjustment for share options and RSUs with dilutive effect 1,863,114 — Diluted weighted-average number of shares outstanding 51,949,798 49,877,218 Basic net income (loss) per share $ 0.10 $ ( 0.49 ) Diluted net income (loss) per share $ 0.10 $ ( 0.49 ) A total of 3,691,365 shares issuable upon the exercise of outstanding share options and vesting of RSUs for the three months ended March 31, 2025 (March 31, 2024: 9,537,918 ), have been excluded from the calculation of diluted net income (loss) per share due to their anti-dilutive effect. For the three months ended March 31, 2025 and 2024, shares issuable upon the potential conversion of all of the Notes (as defined in Note 5. “Interest-bearing loans and borrowings”) were excluded from the calculation of diluted net income (loss) per share due to their anti-dilutive effect. 12 Table of Contents 8. Income taxes Income tax expense is recognized at an amount determined by multiplying the net income (loss) before income taxes for the interim reporting period by the Company’s estimated annual effective tax rate, adjusted for the tax effect of certain items recognized in full in the interim period. As such, the effective tax rate in the condensed consolidated financial statements may differ from the Company’s estimate of the effective tax rate for the Company’s consolidated financial statements for the year ending December 31, 2025 . The Company’s consolidated estimated effective tax rate for the three months ended March 31, 2025 w as 17.4 %. During the three months ended March 31, 2025, the Company recorded a tax charge of $ 1.1 million, comp ared to a tax charge for the three months ended March 31, 2024 of $ 0.4 million. The Company benefits from the U.K. large company Research & Development Expenditure Credit ("RDEC") regime which can generate a cash rebate of up t o 15 % of qualifying research and development expenditures incurred after April 1, 2023. Tax credits receivable under the RDEC regime are recorded "above the line" as a reduction from research and development expenses. For the three months ended March 31, 2025 , the Company excluded the United Kingdom from the calculation of the annual estimated tax rate as the Company anticipates an ordinary loss in this jurisdiction for which no tax benefit can be recognized. A net deferred tax asset o f $ 14.4 m illion has been recognized as of March 31, 2025 ( December 31, 2024 : $ 14.8 million) primarily representing research and development credits and share-based compensation for one of the Company’s U.S. subsidiaries, Immunocore LLC, following an annual assessment, or periodically as required, of all available and applicable information, including its forecasts of costs and future profitability and the resulting ability to reverse the recognized deferred tax assets over a short period of time. During the three months ended March 31, 2025, the Company received U.K. tax credits of $ 6.8 million relating to research and development expenditure in the year ended December 31, 2023. 13 Table of Contents 9. Segment information The Company operates in one operating segment: immunotherapies, which is focused on pioneering and delivering transformative immunomodulating medicines in the areas of cancer, infectious diseases and autoimmune diseases. The Company primarily generates revenue from one stream, revenue from the sale of therapies, which consists of sales of KIMMTRAK. H istorically, the Company had a second stream, collaboration revenue, which is no longer significant. The Company manages its business activities on a consolidated basis. Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision-maker ("CODM"), the Chief Executive Officer, in making decisions regarding resource allocation and assessing performance. The measure of the segment profit or loss used is consolidated net income (loss), and the measure of segment assets is reported on the condensed consolidated balance sheet as total assets. The accounting policies of the immunotherapies segment are the same as those described in Note 2. "Summary of significant accounting policies". The following table summarizes the reportable segment's financial information (in thousands): Three Months Ended March 31, 2025 2024 Revenue $ 93,881 $ 70,502 Less: Cost of revenue from sale of therapies ( 831 ) ( 246 ) External research and development (R&D) expenses: PRAME programs ( 17,305 ) ( 26,700 ) Tebentafusp programs ( 7,990 ) ( 5,894 ) Infectious disease programs ( 1,405 ) ( 2,246 ) All other external clinical and preclinical costs ( 11,231 ) ( 6,499 ) Total external R&D expenses ( 37,931 ) ( 41,339 ) R&D salaries and other employee-related costs ( 11,043 ) ( 9,754 ) Selling, general and administrative (SG&A) salaries and other employee-related costs ( 12,218 ) ( 14,840 ) Other SG&A expenses ( 20,672 ) ( 17,463 ) Other segment expense, net (a) ( 6,163 ) ( 11,296 ) Segment and consolidated net income (loss) $ 5,023 $ ( 24,436 ) (a) Other segment expenses, net includes other internal R&D expenses, share-based compensation expense, R&D tax credits, interest income, interest expense, foreign currency gain (loss), other income (expense), net and income tax expense . 10. Commitments and contingencies Lease commitments The maturities of operating lease liabilities as of March 31, 2025 were as follows (in thousands): 2025 $ 3,569 2026 4,941 2027 4,836 2028 5,094 2029 4,943 2030 and thereafter 46,365 Total lease payments 69,748 Less imputed interest ( 27,283 ) Present value of operating lease liabilities $ 42,465 14 Table of Contents Manufacturing commitments The Company enters into a number of manufacturing commitments for the future purchase of materials and contract manufacturing services. While the majority of such contracts can be cancelled on reasonable notice, due to the significant ongoing expenditure associated with the Company’s programs, including brenetafusp, the Company estimates it has noncancellable commitments in relation to the development and supply of product candidates totaling $ 27.5 million, the majority of which are estimated to be paid within twelve months from the balance sheet date. Gates collaboration Under the terms of the Company’s agreement with the Gates Foundation, the Company is required to develop, manufacture and commercialize soluble TCR bispecific therapeutic candidates targeted to mutually agreed neglected diseases, currently HIV, with the potential to treat people at an affordable price in developing countries. In the event of certain defaults by the Company under the agreement, which the Company considers to be within its control, the Gates Foundation has the right to sell, or require the Company to buy back, any of the shareholdings in the Company held by the Gates Foundation. In such an event, if within 12 months after such redemption or sale, the Company experiences a change in control at a valuation of more than 150 % of the valuation used for the redemption or the sale of the shares, the Company has agreed to pay the Gates Foundation compensation equal to the excess of what it would have received in such transaction if it still held its shares at the time of such change of control over what it received in the sale or redemption of its shares. Legal proceedings The Company is not currently a party to any material legal proceedings. 15 Table of Contents